Steve Chapman

Obama may fantasize that WellPoint will keep furnishing its product forever while stoically swallowing losses. It's more likely to devise ways to curtail benefits, make it harder for applicants to qualify and raise the hassle factor so unprofitable customers go elsewhere. If things get bad enough, it can abandon the market -- leaving consumers to pay the low rate of nothing while also getting nothing.

Such ostentatiously noble but naive schemes are becoming the pattern in Obama's economic policy. A law he signed last year regulating credit card companies, which took effect this week, was supposed to save consumers huge sums. But it has suffered a bruising collision with the real world.

The Associated Press reports that in recent months, "credit card companies jacked up interest rates, created new fees and cut credit lines," while shutting down many accounts entirely. The law, says AP, "has helped make it more difficult for millions of Americans to get credit, and made that credit more expensive."

This administration, like Nixon's, has also elected to override the private sector when it comes to setting pay scales. Last year, attacking Wall Street bonuses as "shameful" and "obscene," Obama issued an order limiting executive pay to $500,000 a year at companies getting taxpayer help. He even appointed a pay czar to decide compensation for managers in that sector.

His approach presumes the government can deduce the correct level and structure of pay for hundreds of jobs in a complex industry. It can't, any more than it can know the correct price for gasoline or toilet paper. That's the function of markets, which adjust as needed to keep supply and demand in balance.

When the government starts fixing wages or prices, it practically guarantees economic malfunctions. Not to mention that it deprives citizens of the right to choose the terms on which they are willing to do business with each other, which happens to be a key to liberty as well as prosperity.

All this is bound to end in tears. Obama has forgotten the lesson of Nixon's experiment: You can tell a farmer what to charge for a chicken. But you can't keep him from drowning the bird.

Steve Chapman

Steve Chapman is a columnist and editorial writer for the Chicago Tribune.

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