Big Government, Big Business Both Evil: Nassim Taleb

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Both big business and big government should be viewed as evils and threatening the real engine of economic growth, which is small business, author Nassim Taleb told CNBC Friday.

Riffing off an aphorism in his new book, "The Bed of Procrustes," which calls opposing big government while supporting big business "inconsistent and corrupt," Taleb said in an interview that problems confronting the economy are political and economic.

"They're both very bad, particularly big government. Big government ends up like socialist states," he said. "They end up favoring large corporations that have a lot of employees. That kills growth from small companies who cannot get to Washington, they cannot get lobbyists."

"The problem I have is that Republicans love big business and Democrats love big government, and I hate both big business and big government," he added.

Famous for his earlier release, "The Black Swan," Taleb advocates investors devote large portions of their portfolios to safe assets and smaller portions to higher-risk plays—rare occurrences, such as the appearance of previously unseen black swans.

His latest work is a collection of aphorisms, or short sayings, regarding his philosophy on a variety of subjects, particularly on the economy, politics and the capital markets.

"My idea is that you should focus on the small guy, the small businessman," he said. "Large corporations become fragile and later on will require a bailout, while these people—hairdressers don't get bailouts, restaurant owners don't get bailouts, companies in Silicon Valley don't get bailouts...These people don't have lobbyists in Washington."

Procrustes is a figure from Greek mythology—the son of Poseidon—who adjusted people's bodies to fit an iron bed he kept in his house. For those too tall for the bed, he would cut down their legs, and for those too short he would stretch them.

Taleb compares the "financial establishment" to Procrustes, who could have adjusted his bed to fit his guests rather than the reverse.

"They're trying to change the wrong variables," he said. "Instead of changing models or accepting limitations on their models, they have an idea in their head and the world has to fit to it."

http://www.cnbc.com/id/40716007

[one...two...tree 2,762]

It's easier to define what Big Business is than it is to define what Big Government is.

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It's easier to define what Big Business is than it is to define what Big Government is.

That's silly.

[Obama 2012 1,714]

It's easier to define what Big Business is than it is to define what Big Government is.

spoken like a true liberal.....

The author is right of course. Politicians have no idea what drives business, so they look to make big business bigger because they see them as large employers and if they do bad, they assume the economy will do bad. Of course this is the problem with having lawyers running your country instead of business men.

Democrats and Republicans are equally guilty of backing big business and in some cases the same businesses. They listen to jokes like Bernanke telling them what to do, when his interests are in proping up the FED and the banks, not in the US Citizenry....

If we took time to actually look at what's driven our economy in the past, instead of looking what what big businesses are hurting today, then we might get somewhere... I don't see that happening though.

[one...two...tree 2,762]

That's silly.

If there's a concrete definition of Big Government that everyone pretty much agrees with, I'd like to know it. If you ask someone from the Left, they'd ramble off a list that includes, warrantless wire taps, an enormous military industrial complex, corporate subsidies. If you ask someone from the Right, they'd include, Social Security, Medicare and the Affordable Health Care Act.

Edited December 17, 2010 by 8TBVBN

[Obama 2012 1,714]

If there's a concrete definition of Big Government that everyone pretty much agrees with, I'd like to know it. If you ask someone from the Left, they'd ramble off a list that includes, warrantless wire taps, an enormous military industrial complex, corporate subsidies. If you ask someone from the Right, they'd include, Social Security, Medicare and the Affordable Health Care Act.

All of which are items of Big Government.

Those who don't associate with political parties have an easier view of things.

[one...two...tree 2,762]

All of which are items of Big Government.

Those who don't associate with political parties have an easier view of things.

Asking a Libertarian for a concrete definition of Big Government is like asking a serial killer what kind of life is worth keeping.

[Obama 2012 1,714]

Asking a Libertarian for a concrete definition of Big Government is like asking a serial killer what kind of life is worth keeping.

Yes, because individual liberty is so hard to understand.

[one...two...tree 2,762]

Yes, because individual liberty is so hard to understand.

Because Libertarians see no value in government beyond their nose.

[Obama 2012 1,714]

Because Libertarians see no value in government beyond their nose.

There's always a value in government and some services. When the government starts impacting ones individual liberty though, is when the line is crossed.

[one...two...tree 2,762]

There's always a value in government and some services. When the government starts impacting ones individual liberty though, is when the line is crossed.

Personal liberty always has limits if you want to share space with others. Most people learn at a young age that while they are free to make choices, they can't just do whatever they want without infringing on the freedom of others.

[Obama 2012 1,714]

Personal liberty always has limits if you want to share space with others. Most people learn at a young age that while they are free to make choices, they can't just do whatever they want without infringing on the freedom of others.

Unless you're physically harming someone or mentally attacking them, there's not much you can do to infringe on anyone else. They make choices, like you do on what happens in their every day life.

[one...two...tree 2,762]

Unless you're physically harming someone or mentally attacking them, there's not much you can do to infringe on anyone else. They make choices, like you do on what happens in their every day life.

Yes, if life were so simple as to always be a good judge of that.

[^_^ 5,021]

If there's a concrete definition of Big Government that everyone pretty much agrees with, I'd like to know it. If you ask someone from the Left, they'd ramble off a list that includes, warrantless wire taps, an enormous military industrial complex, corporate subsidies. If you ask someone from the Right, they'd include, Social Security, Medicare and the Affordable Health Care Act.

I'd say having military bases all over the freakin' world is a pretty good sign that your government might be too big.

[mawilson 2,133]

It's easier to define what Big Business is than it is to define what Big Government is.

I define Big Government as the amount of money spent by the government annually expressed a percentage of GDP.

Anything greater than 20 percent is Big Government. Right now we're close to 45. France is close to 60.