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Wednesday, 25 April 2018 07:12 am

Free market vs central planning

Aug 28th, 2008 | By | Category: Opinion

HAVE we thrown the (planning) baby out with the (communist) bathwater?

No one could dispute that communism has been tried, and found wanting.

Think of the crazy schemes and plans that resulted in mass upheavals and interruptions to production and supply. Images come to mind of Soviet Russia, with long queues of acquiescent citizens waiting to get into shops with empty shelves.

But let’s not go to the other extreme and get rid of centralised planning altogether.

It seems to me that having been overtaken by the free market ideology we are now suffering the consequences of a lack of planning.

For example, our rail network. Built up over a hundred years, then hocked off to private enterprise so it could be run more efficiently. Funnily enough, private enterprise, focused on short term profit, ran down the infrastructure that was bequeathed to us by our forebears.

Many passenger routes were closed, lines have not been maintained. Now, when the reality of high oil prices and diminishing supply are starting to bite, we are faced with needing a quick fix to our public transport system.

If we had planned better, might we have thought earlier about putting more resources into a public transport network and less into roads?

Electricity supply is another area where the greater efficiency of competition and private enterprise don’t seem to have brought us much benefit.

We have faced the prospect of running out of power on a number of occasions. Private consumers pay the highest rates, which is hard on households with low incomes. We have the illogical situation where the more you use, the less you pay. And as with the rail network, the infrastructure is in urgent need of upgrading.

Our health system is fragmented into little DHB’s that are competing for resources. With a population of only four million, it has been suggested that it would make more sense to have a centralised system. If this will deliver us a better service, let’s do it.

We shouldn’t let ideology, of either persuasion, get in the way of common sense.

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is a Whitireia Journalism student.
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  1. Properly understood, the free market is not a “system” in the same way that central planning is. The free market is what is left over after you remove the tyranny of government and criminals, and are left with free, non coercive, exchanges. You are advocating a “balance” between tyranny and freedom. I prefer freedom.

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