This paper formalises and applies the horizon-mismatch theorem, a temporal extension of the Conant-Ashby (1970) requirement that every good regulator must contain a model of its substrate. The extension states a structural impossibility: a regulator whose action-cycle is shorter than the replenishment-cycle of the substrate it nominally manages cannot, by construction, model substrate-state, and substrate-depletion proceeds as the only adjustment-mechanism the architecture’s selection structure permits. The theorem is negative — it identifies the conditions under which substrate-coupled regulation is impossible — and it operates at the structural rather than the moral level. The agents occupying regulator positions cannot perceive substrate-depletion at the timescale of their measurement apparatus, and cannot resist the configuration that holds them in those positions, since the selection mechanism that placed them there continues to operate independently of any individual regulator’s intentions.The theorem is then applied symmetrically to the two dominant economic architectures of the present moment. The contemporary Western financialised configuration, with its approximately ninety-day action-cycle, is shown to be horizon-mismatched against six productive substrates whose replenishment-cycles range from years to centuries: capital stock, customer-supplier ecosystems, human capital, research and development, infrastructure, and the ecological base. The cascade of substrate-depletions the theorem predicts is documented case by case. The Chinese state-directed configuration, examined under the same apparatus, is shown to be horizon-mismatched at a longer cycle but against a different substrate — the multi-generational substrate of independent civil society and accumulated institutional trust — with the cascade running on a different timescale and against a different population. Both configurations exhibit the cybernetic signature the theorem predicts; neither realises the substrate-coupled coordination the libertarian tradition’s economic theorems describe.The paper closes by demonstrating that the three positions the libertarian tradition might occupy in defending the contemporary Western configuration as a free market — economic, comparative, and deregulatory — are no longer cybernetically available, though the political case for the Western configuration on grounds separable from the economic remains untouched by the diagnosis. The argument can be stated in a single sentence: the problem is not that people are short-sighted; the problem is that the architecture selects for short-sightedness and replaces anyone who tries to be otherwise.This is the third paper in The Conditions of the Invisible Hand, following Paper I (Free Markets Without Markets) and Paper II (The Ricardian Inversion).
Moreno Nourizadeh (Sun,) studied this question.