^You're now talking about certain methods of income redistribution, not really about free markets vs regulated markets. I think these, while related, are completely separate issues. As a direct answer to your question, yes, there is a contradiction, because people cannot value things correctly when they don't have both all the necessary information about the value of things, and adequate skills and knowledge to evaluate that information. The more complex things become, requiring specialized knowledge and skills, the harder it becomes to assess things correctly.

Government is a company, just like any other, although it happens to be (in theory) owned by everyone, and it has the capability to rewrite the rules of the game. The rules that govern this company, its managers and employees, do not differ, in principle, from those that govern private limited companies, unless the rules are changed to either favor or handicap one or the other. Agree? So just like for the employees of the private company, there needs to be controls in place to make sure the worker does his job properly, regardless of his/her self-interests, and whether they're working for a public or private organization. Working for a company does not equate just dealing with your own cash and personal direct responsibility, the checks needs to be in place in both cases. Actually I'd even go as far to say, having worked both for the private and public sector, that in a public sector job I'm MORE inclined to do what's good for the general population, since it IS my tax money I'm dealing with, whereas in a private company I am less concerned about the future of the company, since if it does go under, another one will replace it and most people won't even notice. Operating a one man shop or acting as a major shareholder in a corporation are special cases.