Who makes investment choices?

Intersting column by Michael Kinsley claiming to prove that privatising Social Security won’t work. He makes a similar point to one that I have claimed several times, only to get blank stares: that whether a dollar of earnings is spent directly in the economy (beer, refridgerators, chip factories, …) or flows to the government and then is spent in some manner on the economy (F-16s, bridges, farm subsidies, …), it is still a dollar of “investment”. The real question is who makes the best decisions: the proles, who buy beer and TVs; the rich, who build yachts and TV factories, or the government, who build roads and maintain law and order.

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