Democrats and Sweaters

George F. Will: FDR's Sweater Fable | Newsweek Voices - George F. Will | Newsweek.com

Do all Democrats have some fascination with sweaters? This little fable does a good job of explaining why things got so bad in the '30s and late '70s:

The factory, which FDR said was the town's only industry, normally
employed about 200 people who "had always been on exceedingly good
terms" with the owners. However, "it was difficult to sell enough
sweaters to keep them going because there were so many sweater
factories" in the nation, all of which had had only about six weeks'
worth of work in the past year. The town, FDR said, was "practically
starving to death." So the people decided that they all could work if
they reduced everyone's wages 33 percent. That would cut the cost of
their sweaters and enable them to undersell competitors. FDR said the
factory's sales agent went to New York and "in 24 hours" sold "enough
sweaters to keep that factory going for six months, 24 hours a day,
three shifts.

A heartwarming triumph of community solidarity over adversity? Not as
seen through the pince-nez of Roosevelt, who pronounced it "bad
business, in all ways." Granted, "they get a good deal of cash into the
community." But "they undoubtedly, by taking these orders, put two
other sweater factories completely out of business." So:

"That brings up the question as to whether we can work out some kind of
plan that will distribute the volume of consumption in a given industry
over the whole industry. Instead of trying to concentrate production to
meet that consumption into the hands of a small portion of the
industry, we want to spread it out … It might be called the regulation
of production or, to put it better, the prevention of foolish
overproduction."

In other words, competition is bad and centralized control can do better! Once one moves to a leveling redistribution strategy, there is no end to what needs to be controlled. Rather than a system that runs imperfectly but well on natural principles, you get one that lurches all over the place on conflicting commands from a bunch of bureaucrats.

The end result has been seen over and over in the world in the past century -- the poor economy starts kicking and hitting itself and running into things like some macabre slapstick clown or failing horror movie robot and soon the wreck that remains is unable to even feed the bulk of the nation that has been so foolish to turn down this path.

Put on a sweater!