You say, "C'mon, Williams, nobody's proposing that Congress take over the nation's traffic signals and supermarkets!" You're right, at least for now, but the information problem exists in all areas of our lives. Right now Congress tells each American how much should be set aside out of his weekly paycheck for retirement. How can they have the information to know what's the best use for the $70, or so, taken from you and put into Social Security? Might you benefit more by saving that money to start a business, purchase tutoring lessons for your children, or putting it in a private retirement plan? Unlike congressional control of traffic signals and supermarkets, the effects of Social Security aren't apparent because we don't have the information about what people would have been able to accomplish if they were able to keep more of their earnings.
You might argue that saving for retirement is important, but so is saving for a home or your children's education. Would you want Congress to force us to put money aside for a home or our children's education?
Oblivious to the huge information problem in the allocation of resources, the people in Washington have confidence that they can run our lives better than we can. Charles Darwin wisely noted over a century and a half ago that "ignorance more frequently begets confidence than does knowledge." Suggesting that Congress is ignorant of the fact that knowledge is highly dispersed, and decisions made locally produce the best outcomes, might be overly generous. They might know that and just don't give a hoot because it's in their political interest to centralize decision-making.
Thomas Jefferson might have had the information problem in mind when he said, "Were we directed from Washington when to sow, and when to reap, we should soon want bread."