Why Are Free-Market Economists Still Taken Seriously?

[flashl]

Why Are Free-Market Economists Still Taken Seriously?

They've been shown to be wrong time and time again. And their policies have led to widespread disaster and misery for millions of people.

Who am I talking about?

The NeoCons and their wrong-headed views on Iraq?

Nope, I'm talking about free-market economists.

No group of "experts" has a worse track record on accurate information about how our world really works. And yet, mysteriously, free-market economists are still held in reverence and awe by many. And their proclamations are hailed as the gospel truth by everyone from politicians to academia to the mainstream media.

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It seems we are statistic saturated and none of it seems to make a difference.

[wake.up.america]

1. Sell you soul and maybe you can survive.

[flashl]

3. That echoes my frustration

Formulas, theories, concepts, etc. for "social good" have little meaning if they are not executed in "good faith".

[mmonk]

2. The shock doctrine it seems

is America's new set ideology among it's rulers. There apparently is no more competing political and economic ideologies.

[alofarabia]

4. To quote Winston Churchill

"The inherent vice of capitalism is the uneven division of blessings, while the inherent virtue of socialism is the equal division of misery."

[izquierdista]

5. May I suggest a better response?

The next time someone spouts off with some wisdom about the free market, how about replying with this:



AAAGH!! ARE YOU FUCKING CRAZY! WHAT DO YOU WANT, ANOTHER ITTY-BITTY TAX CUT WHILE THE PRICE OF GAS TRIPLES AGAIN? YOU FUCKING MORON! WHERE'S ALL THIS ECONOMIC BENEFIT YOU'RE SUPPOSED TO BE GETTING? CAN'T BE YOUR JOB, YOU KNOW, THE ONE THAT WAS SENT OFF TO INDIA SO YOU COULD WORK THE NIGHT SHIFT STOCKING SHELVES AT THE DOLLAR STORE. I OUGHT TO SHOVE MY FOOT UP YOUR ASS AND KICK YOUR HEAD OUT OF IT SO YOU CAN SEE WHAT'S GOING ON!! HOW'S THAT FREE MARKET WORKING FOR YOUR MOMMA? DID SHE GET THAT MEDICINE SHE NEEDS OR ARE YOU GOING TO BE HAVING ALPO CASSEROLE FOR CHRISTMAS DINNER AGAIN?? WAKE THE FUCK UP JACKASS! YOU'LL NEED TO BE AWAKE TO GET YOUR CRAP MOVED TO A REFRIGERATOR BOX IN THE ALLEY WHILE YOUR LANDLORD BULLDOZES YOUR BUILDING TO PUT IN A STRIP MALL. AAAAAARRRRGGHHHH!!!

[alofarabia]

6. As far as wisdom goes

I'll choose Churchill over the OP (call me crazy).

[flashl]

9. Because we are clear on 'vice of capitalism'

are you saying its the best that we can do?

[wuushew]

28. Churchill was wrong about many many things

From his views on imperialism to Zionism to his loss of position in the admiralty. He was known military meddler as well diverting needed troops from North Africa to the doomed Greek theater in WWII.

His exit from from power was very swift following the conclusion of the war. The only thing he should be honored with is the apt description of the Iron Curtain.

[Ikonoklast]

33. Don't forget about the disaster at Gallipoli in WWI

And his political maneuvering all through WWII to retain the Empire at all costs.

One eye was on Hitler, the other on keeping hegemony over the British vassal states.

[flashl]

8. Thats a keeper.

[dantyrant]

7. They're well-funded.

Free market fundamentalism, à la Milton Friedman, was really pushed by the economics dept of the University of Chicago. John D. Rockefeller founded this university, and called it 'the best investment he ever made'. Consider that, and who was at UChicago, especially post-WWII. If you read through the names of some of the 'academics' who were at that school, you find an astonishing number of today's villains. Leo Strauss, Wolfowitz, Hayek, David Rockefeller, Scalia, ...

[annabanana]

10. The whole scam isn't that hard to figure out once you follow the money.

Like everything else.

[mmonk]

11. I'm reminded of these quotes.

"The theories of Milton Friedman gave him the Nobel Prize; they gave Chile General Pinochet."

-Eduardo Galeano, "Days and Nights of Love and War", 1983

"I don't think I was ever regarded as "evil"".

-Milton Friedman, quoted in the Wall Street Journal, July 22nd 2006

"Creative destruction is our middle name, both within our society and abroad. We tear down the old order every day, from business to science, literature, art, architecture, and cinema to politics and law....They must attack us in order to survive, just as we must destroy them to advance our historic mission."

-Michael Ledeen, "The War against the Terror Masters, 2002

[flashl]

16. Are Thomas Jefferson's words now appropriate?

"Prudence, indeed, will dictate that governments long established, should not be changed for light and transient causes; and, accordingly, all experience shown that mankind are more disposed to suffer while evils are sufferable than to right themselves by abolishing the forms to which they are accustomed. But, when a long train of abuses and usurpations, pursuing invariably the same object, evinces a design to reduce under absolute despotism, it is their right, it is their duty, to throw off such government, and to provide new guards for their future security."

"Rebellion to tyrants is obedience to God."

— two quotes from Thomas Jefferson

[mmonk]

19. Would seem so but I don't want to be one calling

for violence (especially if despotism can be turned away politically). It is my opinion that the US is bringing itself down through greed and mass expansion to enforce that greed which will ultimately be rejected by its victims worldwide causing collapse.

[flashl]

21. Creative destruction in my mind do not require physical violence.

[mmonk]

26. Ledeen is a neoconservative and imperialist.

That is opposite of Jefferson. Jefferson is talking about rebellion from imperialist rule. They are on opposite sides (morally and in definition).

[flashl]

27. My apologies, I was thinking ... creative destruction in the transformation sense.

[mmonk]

29. I can see what you're saying.

No apologies needed. Intent has a lot to do with approaches I think.

[Armstead]

12. Because the term "free market" sounds benign

The phrase sounds like Apple Pie and Motherhood.

The problem is that when left to their own devices, "free markets" congeal into something very different, as we've seen over the last 30 years.

[bbgrunt]

13. because it all sounds so pure and simple and

wrongfully sounds like a tidy package that explains everything. It appeals to those like libertarians and followers of Ayn Rand who wish to eliminate the untidiness of human existence. It is another form of religious extremism that appeals to those who don't see shades of gray.

It's appeal is exacerbated by the teaching of basic economics in business schools. Supply and demand and partial equilibrium are taught as the fundamentals that explain everything. By the time the course turns to market structure and how reality doesn't replicate the conditions necessary for these forces to work this way, most are over their heads and don't want to understand the nuances. They are so enamored of their comprehension of the basics, they don't want to hear anything that invalidates the false beauty of the paradigm. They then use this limited knowledge to justify their political philosophies of "greed is good" and self interest. ......and too many are too ignorant to challenge them.

[Armstead]

15. The logical outcome should also be explained clearly

As a particular company gains wealth and dominance, it has greater resources at its' disposal to fight the competition. As one competitor gains individual victories, their ability to stifle competition increases.

This becomes accelerated when "free markets" also mindlessly allow mergers and takeovers. As a company begins to swallow up its competitors, it's power over the "market" expands geometrically -- which can then double in size as the number of competitors is further reduced. What were once 20 companies quickly congeals into 10 much larger companies etc....Eventually you have markets that are not "free" but are enslaved to a handful of monopolists.

If only that simple truth could get through the wall of ignorance about the merits of unfettered "free markets."

[bbgrunt]

14. Another reason is that economists glorify the idea

that they deal in "science" which is devoid of value judgments. In doing this they tend to rely on quantitatively measureable variables and are thus absorbed by measures of efficiency. They ignore equally important qualitative values such as distribution and equity because policies that promote equity and justice can be shown to be "inefficient" in the short run--thus government becomes the problem not the solution.

[flashl]

23. Elegant.

[Odin2005]

37. Good point. All too often economists treat people as just cogs in the "machine" of the economy.

I get annoyed when some free market fundamentalist complains about "inefficiency," as if serving "the machine" was more important then what is morally good and morally right.

[Beelzebud]

17. Because their billionaire friends own and control the news media?

[originalpckelly]

18. So how do you solve the problem of the inefficiency...

related to planning in a planned economy? How does one deal with the fact that a plan must be continuously updated as events do not play out as according to plan, or there must be inefficiency caused by a lack of planning?

Why have a bureau that determines how many pens will be made, instead of a free market that self-regulates the number of pens to be produced?

In a free market, if the ability to profit off the production of pens is lowered, businesses that make pens will simply go out of business until supply comes in line with demand. Only businesses that efficiently produce pens will stay around, thusly causing the economy to become more efficient.

I would suggest that both fascism and communism are planned models for an economy, with capital being handed over to a government in one system and government being handed over to big business in the other. Both systems require planning up the wazoo to remain efficient, in other words, someone must go out and find out how many pens are going to be needed, then they go back and select out producers for those pens. Pen making is rationed out between various different companies, even companies with bad business models that cause the process to be inefficient, or someone must do more planning and select the best company. This process must go on continuously, and it siphons productivity that could be used in other areas of an economy to produce more real things, instead of just pushing papers.

I would submit to you that the existence of large corporations is relatively impossible in a true free market system, because big corporations operate like little planned economies. Wal-Mart is a great example of this, a lot of its money goes into the logistics of owning so many stores. If those stores all existed as independent companies, the work required to plan the business would be on the backs of the employees selling things, rather than a massive supply network. It's called self-regulation and it's what makes a free market economy work so well in the long term.

[bbgrunt]

22. good point, but it becomes a contradiction in terms when

you define a free market as one that is devoid of large corporations and then suggest that the reason for this is that large corporations are inefficient. Unfettered free markets are the source of mega corporations--not because they are inefficient, but because they become powerful monopolies that can more efficiently transfer wealth to themselves.

In reality, the efficiency of what is called "economies of scale" (large corporations or governments) depend on the resources and technology involved in production. The push for electricity deregulation stemmed from the changes involved in the technology involved in its production--once thought to only be efficient as a "natural monopoly" which needed regulation by the state to prevent it from devouring wealth of consumers through its monopoly status. As smaller scale operations were shown to be "efficient" with new technology, the push was on to deregulate as in Ca. We saw, however, that was premature and disastrous.

Over long periods of time, technologies develop to destroy old monopolies. This process is called creative destruction. Think phones. Once a natural monopoly because of the huge investment necessary for phone lines and infrastructure, now the internet and satellite transmissions and cell phones make the traditional land-line based system less efficient and subject to some competition. However, this does not stop the drive to monopolize and control the market in order to extract wealth. In just continues with the new technology. It is the natural outgrowth of unfettered or unregulated free markets. The inefficiencies incurred by having a large decision making operation are overwhelmed by the returns of having monopoly control and greater profit in the short run.

[bread_and_roses]

25. on what evidence do you base such claims?

"a free market economy works so well in the long term" - eh? where? when? Where and when has "a free market" provided universal education, public health measures, full employment, a safety net, etc? Where has it protected the environment? Where and when has "a free market" ever served anyone but the few Owners enriching themselves off the labor of the many?

If the "free market" had any ability or interest in regulating itself we would never have needed laws against child labor, adulterated drugs, filthy and even poisonous food, or dangerous, exploitive working conditions. Somehow, though, none of those evils were addressed until that wonderful free market was regulated by law.

What you wrote strikes me as fantasy.

[treestar]

32. Exactly. The huge corporation is most vulnerable to competition

from up and coming newer, smaller and more efficient companies. We shoot ourselves in the foot with most government regulation - it functions just to help those huge corporations avoid that competition. They can afford to comply with the regulation and the new starts ups are choked in their inception.

[Mr_Monday]

20. It's the simplicity of the theory. nt

[Tejas]

24. for that matter, ANY economist

Ever seen a rich economist?

[Time for change]

30. They're taken seriously because they have the force of the corporate news media behind them

Naomi Klein, in "The Shock Doctrine -- The Rise of Disaster Capitalism", explains very well why they shouldn't be taken seriously. So does Paul Krugman, in "Conscience of a Liberal".

[LostInAnomie]

31. Because it works how it is supposed to work for those it is supposed to work for.

Namely the rich. It is a great tool for the continued stratification of wealth, and the funneling of new wealth to those that already possess capital.

[Chulanowa]

34. Because it has the word "free" in it

And Americans are trained from birth to have a Pavlovian response to this word. Further the full meaning and ramifications of the "Free market" are never explained or explored. They are purposefully obfuscated by painting everything else as undesirable, and shifting the argument to discussions of those topics rather than the free market.

The "free market" is, simply put, the removal of every worker protection ever put into place, the massive layoffs and lowering of wages, and global competition for local jobs. This message is left unsaid, however.

[Hippo_Tron]

35. Are we talking about free market economists or free market fundamentalists?

Free markets do some things better than governments and governments do some things better than free markets.

Those fundamentalists who refuse to admit that free markets can't do everything are either stupid or greedy.

[Odin2005]

36. Neo-Liberalism is the right-wing equivalent of Marxism, a secular religion, a cult.

Just like Marxists, they are dogmatic ideologues that try to fit the facts to agree with their dogmas instead of actually objctively looking at the facts. I have a good book on economic history called The Wealth and Poverty of Nations by David Landes. Landes is a critic of neo-liberal nonsense and talks about how protectionism was, and in his opinion still is a necessary part of industrialization. Japan understood this, and China is understanding this.

[Mythsaje]

38. The "free market" is a myth...

Without regulation, the power tends to collect with those having the most money, who then corral the market to their benefit. There's no such thing as a level playing field WITHOUT regulation. Anyone who says differently is a dumbass.

[annabanana]

39. You're right.. there has NEVER been a "free market"

It's always the degree of pitch on the field..

[robcon]

40. The free market works.

Look at Eastern Europe.

[Nye Bevan]

41. Paul Krugman is actually one of my favorite columnists

and I would definitely take him more seriously than some Soviet-era advocate of 5 Year Plans.

Does that make me a bad person?

[WinkyDink]

42. People like the sound of the word "free". Sounds "Amurcan".

[ryanus]

43. Neo-cons are not free market proponents

They are autoritarians who want control. They want to take functions of government out of the hands of the government and give them to corporations. That's "fascism."

Free market economists don't say that things like law enforcement, tax collection, and prisons should be "free market." But neo-cons do.

From the article: "Free-market economists are rabid advocates of a unfettered, dog-eat-dog, ruthless form of capitalism. Leaving everything to the "free market" is the best way to run a society, they maintain." No, that's a strawman. Free market advocates don't say anything about "how to run a society." They advocate the best way to run a MARKET is without government intervention. Not everything should be in a market (like law enforcement like I mentioned).