GOVERNMENT PARTICIPATION CAN SCREW UP THE FREE MARKET
That's what John has learned as set forth in his post below. John is correct in arguing for reform in the Department of Defense, which proves the inefficiency of big government programs. Reform is needed because defense is one of the core functions of government that cannot really be privatized. We see other failures of the free market in other areas where government is a major customer, such as in the health care industry, and there is plenty of opportunity for the government to scale back its involvement. Unfortunately, things are heading the other way. When the person purchasing goods and services, i.e., the patient, does not make a decision even partially based on the price of the service, then the market gets well out-of-whack. This can happen when the insurance company is picking up the tab or when government is. Now, the Republicans and Democrats want the government to pick up the bill for your prescription drugs. No longer will you decide that you can really survive on Sudafed and you don't need that prescription Clarinex, because here comes the government to pick up the tab. Demand stays artificially high, and there is no pressure on prices to fall.

DOD sees this. When its budget rises, so do the costs of tanks, planes and spare parts. Cut the budget, demand falls and so do prices. It's Econ 101. Now, if liberals and conservatives could work together to eliminate DOD waste and not inject artificial demand into the health care, we'd all be better off. Unfortunately, few government decisions are based on such obscure criteria as the rules of Economics, so expect more big government giveaways so that the average voter will thing that Congress is "doing something" about health care or the war on terror.