The government doesn't have a mechanism to self-regulate. Democracy was supposed to regulate the government, and probably can in small societies, or perhaps if formulated the correct way. American democracy definitely doesn't regulate government, and it doesn't self-regulate, so it's a system that's out of control.
You see the same mechanisms (plus others) in many societies in the 20th century. I don't see any evidence or reason to think the government can manage the economy. And a big part of the causal explanation is what I've stated above. Another is that the government isn't omniscient; it doesn't have enough information. Market solutions don't need to be omniscient and price serves to carry information.
As an aside, fun fact: Did you know that in the US, price controls are used by a government committee to set the price of the fundamental good, which is the US dollar? That does a lot to disrupt price as a signal of information. People think in the US we don't have government price fixing, and they are wrong. (I use the US as a pet example but I guess the above is basically true everywhere.)