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Economic ignorance will cause economic collapse

John Hinderaker has been writing at PowerLine about the economic catastrophe taking place in Sri Lanka. Until very recently, that country was “not only food-secure, but a major agricultural exporter” of products like rice, tea and rubber.

One would think that creating prosperity and lifting millions out of poverty would be welcomed by government and social activists.

But no.

The government of Sri Lanka decided to mandate new policies prompted not by the recommendations of anyone with experience in industry. but by the howling of environmentalists.

Despite the fact that more than 75% of Sri Lanka’s farmers used synthetic fertilizer, the Sri Lankan government banned it outright.

The results were predictable. In one year, Sri Lanka’s rice production dropped by 14%, forcing the country to spend hundreds of millions importing a product they had formerly made enough of to feed themselves and export. The price of food has quadrupled, and many staples, including liquid petroleum gas that Sri Lankans use for cooking, are in such short supply that citizens must stand in line for them.

If this pattern seems vaguely familiar, it should. Many of us are old enough to have witnessed the fall of the former Soviet Union, brought to its knees by failed collectivism. Younger folks have watched in real time as the economy of Venezuela collapsed following implementation of top-down, command-and-control economic policies.

But the ruling classes never learn. Here at home, the Biden administration, in thrall to “climate change” theorists, is busy throwing wrenches into the gears of American industries.

Among President Joe Biden’s first acts in the White House was shutting down the Keystone Pipeline and throttling drilling for oil and natural gas on federal lands.

Those decisions and others like them have sent fuel prices soaring. Biden has gone hat-in-hand to Middle Eastern countries, begging them to increase production. (They refused.)

None of this should surprise anyone with a modicum of common sense or any experience with business, both of which are in short supply in government. When people who have no concept of how to start or run a business decide they will control industries, the inevitable result is collapse. Socialists, environmentalists and the officials whose strings they pull are about as economically ignorant as they come.

Progressive activists of all stripes claim that the changes they promote will make business “accountable” and the system more “fair.”

Like killing the goose that lays golden eggs, transforming the U.S. into a command-and-control style economy with decisions driven by ideologues pitching scientifically unproven (or worse, disproven) theories will not better or more fairly distribute the goods and services that private enterprise creates. It will slowly constrict production and provision of those goods and services — just as Biden’s policies are doing now. When that happens, millions starve.

There are some (arguably fringe) environmentalists who might not be devastated by that result. Regardless of their pet theories or reasons for wanting it, history shows that central planners and their top-down, command-and-control economics never work. Their theories are inevitably wrong in ways they did not anticipate.

The United States is not — yet — on the brink of collapse. But economic policies preached by the ignorant and the arrogant can destroy our prosperity and peace, just as they have in the countries that took that path. More than 100 million people have died and untold amounts of wealth have been destroyed proving this point over and over again. We ignore the lesson at our peril.

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