In 1973, Milton Friedman wrote a letter which is, quite possibly, one of the best pieces of prose ever written about government and its limits. (You can find the letter here: http://www.johnlatour.com/barking_cats.htm).
What Friedman lays bare, quite nicely, is the liberal fallacy that the main problems of government exist because there is a deficit of good people in power. This notion gives rise to the fundamental belief that to fix the problems of the world, all we need to do is find the right “good” people who are intelligent, wise and selfless and who will take the appropriate steps in furtherance of the best interests of all the people. It is a comforting thought, because it means that we are in control of our destiny and we need only to tweak the machinery to get it right. The alternative, the reality, is much bleaker, even if it is true, and there is a tendency for many people not to want to acknowledge it. The reality is, as Friedman put it, that there are laws to bureaucratic systems and organizations in the same way there are laws of nature, and they are not easily fixed by changing those in power. It is the system itself which prevents the effective implementation of many good ideas. Centralization fails not because people aren’t good or intelligent, but because it is simply not possible for centralized bureaucratic institutions to be intelligent enough or wise enough to make decisions for hundreds of millions of people. The power and insight of decentralized decision making by the many is simply so much greater than that of a centralized power that they do not even compare. That is why free markets work and planned economies do not.