You simply have to admire the commitment of European leaders to ignore common sense, simple arithmetic, and their voters in pursuit of the goal of a United Europe at all costs. It is really quite astounding.

The Republicans have put up two plans. The House passed one. Obama is criticizing them for not compromising, but he has offered no concrete plan, just vague ideas about cuts of the “player-to-be-named-later” variety. You can’t compromise when you don’t have anything on the table to compromise with. The budget Obama submitted last February was rejected by the Senate 97-0. Not one Democrat voted for it. We must raise the debt ceiling, but we must also get serious deficit reduction into the process. I am not against tax reform (indeed, I am all for a lot of tax ideas), but we can’t pass any tax increases without guaranteed cuts that are much larger than the increases. And we need to recognize that tax increases will not make it any easier for new businesses to start up.

The EU pledges that Greek creditors will take a hit but that this will never ever happen again, not with Spain or Italy in particular. That’s not a credible promise, if only because of the magnitudes involved, and so over time it shouldn’t influence the borrowing rates of those countries very much. It’s worth a small amount to have the promise made at all, but the comparable promises made about Greece were just broken so who is being fooled here?

Hayek and Mises strongly believed in decentralization because they believed that certainty regarding how to solve economic problems was impossible to attain, and that the best answers could only be arrived at through the spontaneous and uncoordinated actions of millions of individuals interacting freely within the marketplace. They believed that steering the economy through a centrally planned, one-size-fits-all approach could never account for the thousands of degrees of variation within different individuals’ operative knowledge, personal preferences, access to resources, etc. For these reasons, Mises and Hayek feared the unintended consequences of government planning, and rightly pointed out that such planning would necessarily block innovation and inject systemic risk into the system by preventing the market from routinely ferreting out poor practices.

In markets, there is a severe penalty for being consistently and stubbornly wrong: You lose your capital. If you fail to reverse yourself, you eventually get steamrolled over. In other realms, such as politics and economics, there is no such penalty. Being horrifically, tragically wrong leads to jobs at Think Tanks and book deals and speaking gigs preaching to audiences who are similarly wrong.

Employment, even during a recession, is not solely the result of lucky few finding available positions. All else being the same, the market tends to create and allocate jobs for those people who are most interested in working. That’s why, if government is to avoid making employment any less than it has to be, it’s so important to pay attention to the incentives created by taxes, subsidies and government regulations.

As trade scholar Dan Griswold wrote in his book Mad About Trade, “If one of our children grows up to invent a way to move goods and bits of information even more rapidly around the world, we rightly call that ‘progress’; if another child grows up to become a populist politician who advocates raising trade barriers to slow the movement of those same goods and data across borders, we perversely call that ‘progressive.’”