Two Steves and One Soichiro: Why Politicians Can't Judge Innovation
Michael Munger at The Library of Economics and Liberty - why markets almost always works better than any kind of central planning. [root]
But Jobs and Wozniak were out at the extreme of opinions about computers and the future. They moved out of the garage in 1976, and in 1980 they rolled out the $3,495 Apple III (that's about $9,000 today!). Clearly, this company had no future. Of course, they had not received, or risked, any public money, so it was no one's problem but theirs. Their hunch, their money, their loss.
Then, the Steves held a public stock offering of stock later in 1980. And against all expectations, they became instant millionaires, selling 4.6 million shares. That's a lot of shares; is Median Joe a risk taker, after all? Not really; suppose that each sale was for just one share, to 4.6 million people. That would still mean that more than 97% of the U.S. population thought the stock was a bowzer. And in fact just a few people bought any shares at all, though these few oddballs bought heavily, making a "yes" bet when everyone else was betting "no."
...
And we could go further: imagine a security line at the airport where the guard looks at your boarding pass and asks, "Are you carrying any weapons?" When you say no, he gives you one, a 9mm Glock. "All passengers are required to carry these, sir. Airline policy." Not all airlines, mind you; only "Glock Air" (motto: "We just flew in from Cleveland, and boy are our arms locked and loaded"). You might choose to fly Glock. They have never had a terrorist incident, and if you push the flight attendant call button the guy comes running.
Or, you might not fly Glock. You don't have to. You might choose some other airline with a unique combination of services, safety, and schedule. In the current regulatory environment, too many decisions are one-size-fits-all, because we don't recognize the possibility that it could be different.
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