Government cannot solve social or economic problems

Today's Mises article eloquently explains why social democracy is inherently flawed in concept. It begins the discussion by highlighting the key justification for a system of social democracy where government intervenes "on behalf" of the public "to try and fix" a whole range of social and economic problems.

In the midst of nationwide prosperity, some economic and social problems keep nagging at the public. All over the country, they take the same form. What are they? Traffic congestion, inadequate roads, overcrowded schools, juvenile delinquency, water shortages. Such matters have proven troublesome in many ways; above all, they seem to breed conflicts.

The article then points out the common denominator between all these problematic issues - government ownership or control.

Is there anything special about water or schooling that creates insoluble problems? How does it happen that there are no fierce arguments over what kind of steel or autos to produce, no battles over the kind of newspapers to print? The answer: There is something special — for the problems of schooling and water supply are examples of what happens when government, instead of private enterprise, operates a business.

Have you ever heard of a private firm proposing to "solve" a shortage of the product it sells by telling people to buy less? Certainly not. Private firms welcome customers, and expand when their product is in heavy demand thus servicing and benefiting their customers as well as themselves

I couldn't agree more with this, especially here in the state of Victoria, where taxpayer funds are being used by the state gov't to broadcast TV commercials about water usage. The commercial begins with the question "How can we, as Victorians, reduce our water consumption by 16%?". To this brainless question, I respond angrily to my TV saying "Go to hell, why should I reduce my water consumption if there would be private firms willing to sell me water in a free market?"
My favorite part of the article comes as it explains how government goes about "solving" a problem, which inevitably involves creating a new one.

It is only government that "solves" the traffic problem on its streets by forcing trucks (or private cars or buses) off the road. According to that principle, the "ideal" solution to traffic congestion is to outlaw all vehicles! And yet, such are the suggestions one comes to expect under government management.

Is there traffic congestion? Ban all cars! Water shortage? Drink less water! Postal deficit? Cut mail deliveries to one a day! Crime in urban areas? Impose curfews! No private supplier could long stay in business if he thus reacted to the wishes of customers. But when government is the supplier, instead of being guided by what the customer wants, it directs him to do with less or do without. While the motto of private enterprise is "the customer is always right," the slogan of government is "the public be damned!"