# Are all economic ideologies aside from free-market/Randian theory obsolete? **URL:** \ **Category:** Great Debates\ **Created:** [April 24, 2013, 10:57pm UTC](https://boards.straightdope.com/t/are-all-economic-ideologies-aside-from-free-market-randian-theory-obsolete/656625 "2013-04-24T22:57:21Z")\ **Posts on this page:** 20\ **Page:** 4
**Author:** ![BrainGlutton](https://avatars.discourse-cdn.com/v4/letter/b/82dd89/32.png) [@BrainGlutton](https://boards.straightdope.com/u/BrainGlutton)\ **Post date:** [April 25, 2013, 10:46pm UTC](https://boards.straightdope.com/t/are-all-economic-ideologies-aside-from-free-market-randian-theory-obsolete/656625/61 "2013-04-25T22:46:48Z")
> [@Der\_Trihs](#): > > No; I assume many are just corrupt. Corrupt? Was Milton Friedman in it for the money? ---
**Author:** ![WillFarnaby](https://sea3.discourse-cdn.com/straightdope/user_avatar/boards.straightdope.com/willfarnaby/32/514_2.png) [@WillFarnaby](https://boards.straightdope.com/u/WillFarnaby)\ **Post date:** [April 25, 2013, 10:49pm UTC](https://boards.straightdope.com/t/are-all-economic-ideologies-aside-from-free-market-randian-theory-obsolete/656625/62 "2013-04-25T22:49:33Z")
Regulation is necessary in the banking industry only because government has corrupted any self-regulating mechanisms by passing FDIC. The implied bailout phenomenon also is a corruption of market self regulation. ---
**Author:** ![BrainGlutton](https://avatars.discourse-cdn.com/v4/letter/b/82dd89/32.png) [@BrainGlutton](https://boards.straightdope.com/u/BrainGlutton)\ **Post date:** [April 25, 2013, 11:02pm UTC](https://boards.straightdope.com/t/are-all-economic-ideologies-aside-from-free-market-randian-theory-obsolete/656625/63 "2013-04-25T23:02:58Z")
> [@WillFarnaby](#): > > Regulation is necessary in the banking industry only because government has corrupted any self-regulating mechanisms by passing FDIC. The implied bailout phenomenon also is a corruption of market self regulation. The banking system was largely unregulated throughout the 19th Century and it was full of disastrous [bank panics.](http://en.wikipedia.org/wiki/Financial_crisis#19th_century) Really major financial crises in the 20th Century were fewer. ---
**Author:** ![WillFarnaby](https://sea3.discourse-cdn.com/straightdope/user_avatar/boards.straightdope.com/willfarnaby/32/514_2.png) [@WillFarnaby](https://boards.straightdope.com/u/WillFarnaby)\ **Post date:** [April 25, 2013, 11:35pm UTC](https://boards.straightdope.com/t/are-all-economic-ideologies-aside-from-free-market-randian-theory-obsolete/656625/64 "2013-04-25T23:35:51Z")
> [@BrainGlutton](#): > > The banking system was largely unregulated throughout the 19th Century and it was full of disastrous [bank panics.](http://en.wikipedia.org/wiki/Financial_crisis#19th_century) Really major financial crises in the 20th Century were fewer. Untrue on all counts. For now I’ll just offer this: government allowed suspension of specie payments was commonplace when people realized the banks were insolvent during this period. This is equivalent to an implied bailout and a source of moral hazard. ---
**Author:** ![Der\_Trihs](https://sea3.discourse-cdn.com/straightdope/user_avatar/boards.straightdope.com/der_trihs/32/233_2.png) [@Der\_Trihs](https://boards.straightdope.com/u/Der_Trihs)\ **Post date:** [April 26, 2013, 12:43am UTC](https://boards.straightdope.com/t/are-all-economic-ideologies-aside-from-free-market-randian-theory-obsolete/656625/65 "2013-04-26T00:43:59Z")
> [@BrainGlutton](#): > > Corrupt? Was Milton Friedman in it for the money? Or ego or pride, or maybe he was just a True Believer. Not for any valid moral or intellectual reason however. ---
**Author:** ![deltasigma](https://avatars.discourse-cdn.com/v4/letter/d/e5b9ba/32.png) [@deltasigma](https://boards.straightdope.com/u/deltasigma)\ **Post date:** [April 26, 2013, 1:06am UTC](https://boards.straightdope.com/t/are-all-economic-ideologies-aside-from-free-market-randian-theory-obsolete/656625/66 "2013-04-26T01:06:31Z")
> [@Der\_Trihs](#): > > Or ego or pride, or maybe he was just a True Believer. Not for any valid moral or intellectual reason however. I don’t know much about the man personally, but you do know that he single handedly created monetary theory - right? Before [Uncle Milty](http://en.wikipedia.org/wiki/Milton_Friedman), people were pretty much clueless about the effect of the money supply on economic activity. You might want to skim that wiki link. ---
**Author:** ![adaher](https://avatars.discourse-cdn.com/v4/letter/a/dec6dc/32.png) [@adaher](https://boards.straightdope.com/u/adaher)\ **Post date:** [April 26, 2013, 6:00am UTC](https://boards.straightdope.com/t/are-all-economic-ideologies-aside-from-free-market-randian-theory-obsolete/656625/67 "2013-04-26T06:00:14Z")
We’re still arguing about how much capitalism needs to be regulated, but the debate over free markets vs. central planning has been decided, and yes, those still in favor of central planning are dinosaurs. ---
**Author:** ![nicky](https://avatars.discourse-cdn.com/v4/letter/n/f0a364/32.png) [@nicky](https://boards.straightdope.com/u/nicky)\ **Post date:** [April 26, 2013, 9:03am UTC](https://boards.straightdope.com/t/are-all-economic-ideologies-aside-from-free-market-randian-theory-obsolete/656625/68 "2013-04-26T09:03:29Z")
Radianism was the demented brain fart of a mad old bag, saved only from immediate obscurity by its temporary usefulness in the Cold War as a polemic against sovietism. The term ‘Free Market’ is now so diluted as to be meaningless. ---
**Author:** ![adaher](https://avatars.discourse-cdn.com/v4/letter/a/dec6dc/32.png) [@adaher](https://boards.straightdope.com/u/adaher)\ **Post date:** [April 26, 2013, 9:10am UTC](https://boards.straightdope.com/t/are-all-economic-ideologies-aside-from-free-market-randian-theory-obsolete/656625/69 "2013-04-26T09:10:21Z")
Couldn’t the same logic be applied to freedom in general? ---
**Author:** ![rogerbox](https://avatars.discourse-cdn.com/v4/letter/r/76d3ee/32.png) [@rogerbox](https://boards.straightdope.com/u/rogerbox)\ **Post date:** [April 26, 2013, 11:26am UTC](https://boards.straightdope.com/t/are-all-economic-ideologies-aside-from-free-market-randian-theory-obsolete/656625/70 "2013-04-26T11:26:20Z")
Yes, “Freedom” is meaningless because “Free market” religionists use it to mean you should smile while a gigantic corporation poisons the earth causing birth defects… smile, its _freedom!_ ---
**Author:** ![adaher](https://avatars.discourse-cdn.com/v4/letter/a/dec6dc/32.png) [@adaher](https://boards.straightdope.com/u/adaher)\ **Post date:** [April 26, 2013, 11:46am UTC](https://boards.straightdope.com/t/are-all-economic-ideologies-aside-from-free-market-randian-theory-obsolete/656625/71 "2013-04-26T11:46:36Z")
Regulating pollution doesn’t diminish freedom anymore than regulating stabbing does. A market is still free even if heavily regulated. The only thing that makes a market unfree is if the government controls competition directly, which every government does in some industries. That has to stop. ---
**Author:** ![ITR\_champion](https://avatars.discourse-cdn.com/v4/letter/i/c67d28/32.png) [@ITR\_champion](https://boards.straightdope.com/u/ITR_champion)\ **Post date:** [April 26, 2013, 1:32pm UTC](https://boards.straightdope.com/t/are-all-economic-ideologies-aside-from-free-market-randian-theory-obsolete/656625/72 "2013-04-26T13:32:32Z")
> [@The\_Hamster\_King](#): > > Exactly. Marxism _worked_. Not well, mind you, but well enough that very large countries were able to function with their economies organized along Marxist lines. Factories still made stuff, farmers still grew food, schools stayed open, borders were defended. There were huge inefficiencies, of course, and horrible brutality was common, but Marxism only looks like an abject failure when you compare it to the regulated market economies of the west. It was certainly a step up from the feudalism that it often replaced. I’d take feudalism over hard-core communism any day of the week. The Great Leap Forward is estimated to have been responsible for the starvation of seventy million of people. Marxist economies were able to function only to the extent that they weren’t truly communist. In the Soviet Union 50 years ago, for example, most of the large farms had been nationalized, but it was still legal to privately own small plots of land. If I recall correctly, the small private plots accounted for something like 2% of farmland, but over half of the food produced in the country. (Friedman covers this in _Free to Choose_.) If everything had been run on strictly communist lines, mass starvation would have been the rule through the Soviet period. We need only look to North Korea or Cambodia under the Khmer Rouge to see what happens in a truly communist country. ---
**Author:** ![puddleglum](https://sea3.discourse-cdn.com/straightdope/user_avatar/boards.straightdope.com/puddleglum/32/137_2.png) [@puddleglum](https://boards.straightdope.com/u/puddleglum)\ **Post date:** [April 26, 2013, 1:57pm UTC](https://boards.straightdope.com/t/are-all-economic-ideologies-aside-from-free-market-randian-theory-obsolete/656625/73 "2013-04-26T13:57:05Z")
> [@The\_Hamster\_King](#): > > Exactly. Marxism _worked_. Not well, mind you, but well enough that very large countries were able to function with their economies organized along Marxist lines. Factories still made stuff, farmers still grew food, schools stayed open, borders were defended. There were huge inefficiencies, of course, and horrible brutality was common, but Marxism only looks like an abject failure when you compare it to the regulated market economies of the west. It was certainly a step up from the feudalism that it often replaced. > > I’ll start taking the free-market absolutists seriously when they can demonstrate a similar measure of real-world success. Communism defeated Hitler and put the first man in space. What achievements can libertarianism point to? Record-breaking dumpling production in Kowloon Walled City? Every significant country that has tried communism has either had genocide, famine, or both. The Ukranian famine killed 20 million people, the Great Leap forward famine killed 40 million people, the Ethiopian famine killed 400,000 people, and the North Korean famine killed 2 million people. Marxist economics have killed more people than every war the US has been in except WW2 combined, not just US casualties, both sides. Libertarianism has never been tried but every country that has tried freeing its economy has grown. In 1980 Hong Kong and Singapore had per capita GDP that was a little over half of what it was in the US. Today, Singapore has a higher per capita GDP and Hong Kong is almost the same as the US. Singapore and Hong Kong have two of the freest economies in the world. In 1980 Chile had a little more than half the per capita GDP of Argentina, now it has almost as high per capita GDP. [Here](http://www.econlib.org/library/Columns/y2010/SumnerFig1.jpg)is a chart with per capita income and economic freedom for the wealthiest countries in the world. ---
**Author:** ![RickJay](https://avatars.discourse-cdn.com/v4/letter/r/bb73d2/32.png) [@RickJay](https://boards.straightdope.com/u/RickJay)\ **Post date:** [April 26, 2013, 2:01pm UTC](https://boards.straightdope.com/t/are-all-economic-ideologies-aside-from-free-market-randian-theory-obsolete/656625/74 "2013-04-26T14:01:03Z")
**Economic ideologies are always wrong.** Economics, the social science, is quite often right. An _ideology_ is, pretty much by definition, a stubborn oversimplification. ---
**Author:** ![ITR\_champion](https://avatars.discourse-cdn.com/v4/letter/i/c67d28/32.png) [@ITR\_champion](https://boards.straightdope.com/u/ITR_champion)\ **Post date:** [April 26, 2013, 2:07pm UTC](https://boards.straightdope.com/t/are-all-economic-ideologies-aside-from-free-market-randian-theory-obsolete/656625/75 "2013-04-26T14:07:40Z")
> [@The\_Hamster\_King](#): > > I’ll start taking the free-market absolutists seriously when they can demonstrate a similar measure of real-world success. Communism defeated Hitler and put the first man in space. What achievements can libertarianism point to? Record-breaking dumpling production in Kowloon Walled City? Okay, let’s have a look. Of course there has never been a country governed exactly along the lines that Adam Smith proposed, just as there’s never been one governed exactly as Karl Marx proposed. However, some of have come close. In the USA in the 19th and early 20th centuries, we had economic policy pretty close to libertarian lines. There was no wide-scale government “management” of the economy, very little regulation, and only a light touch of government investment in infrastructure. The one major way in which the government diverged from Adam Smith’s economic advice was protective tariffs, but other than that the USA was a roughly libertarian country. The results were amazing. First of all, when it was founded the USA was dirt poor. By 1900 it had risen to become by far the most prosperous nation in the history of the world. Tens of millions of people in the less free economies of Europe and Asia voted with their feet and moved to the United States. The USA’s standards for health and education became the envy of the world. A stream of scientific discoveries and inventions poured forward that brought huge benefits to everyone on the planet: the light bulb, the telephone, the airplane, electricity, … Some will doubtlessly respond by pointing to certain things in the USA that weren’t perfect in those years, particularly regarding the rights of blacks and Native Americans, and I wouldn’t dispute that. But life in the USA was vastly better than life in unfree economies and better than it ever would be in any communist country. ---
**Author:** ![puddleglum](https://sea3.discourse-cdn.com/straightdope/user_avatar/boards.straightdope.com/puddleglum/32/137_2.png) [@puddleglum](https://boards.straightdope.com/u/puddleglum)\ **Post date:** [April 26, 2013, 2:24pm UTC](https://boards.straightdope.com/t/are-all-economic-ideologies-aside-from-free-market-randian-theory-obsolete/656625/76 "2013-04-26T14:24:04Z")
> [@Der\_Trihs](#): > > That’s not true at all, there’s all sorts of ways to manipulate a market. For example, a big company dumping an inferior product under cost to drive a better product by a smaller company out of business, then raising the price drastically when their competition is gone. Or companies meeting together and deciding what will be sold where by who at what price. Or a company lying about what its product is like. Or a company ordering its employees to buy certain products or be fired. Or a company that uses slaves to make its products. And all sorts of other things prohibited (or that should be) by those so-evil regulations. > > The market in the real world is not some magic system that produces the best product for the best price, it’s system of self interested, often ruthless people trying to game it every way they can, and who if they can will happily cheat and collaborate with each other to cheat. A company that lost money on every transaction in order to drive up market share would soon be out of business, especially if they were producing an inferior product. Cartels always fail unless they have an enforcement mechanism provided by the government. That is why monopolies in the real world are generally caused by the government. Slavery is already illegal. The government in the real world is not some magic system that produces the best regulations for the best outcomes. It’s a system of self interested, often ruthless people trying to game it every way they can, and who if they can, will happily cheat and collaborate with each other to cheat. Markets fail all the time and are gamed all the time. But they are still better than government control. If I don’t like the way I was treated by a company I can use their competitor. If I don’t like the way a government is treating me, I can sell my house, get a new job, get my spouse a new job, take my kids out of school and away from their friends and move to a place with a different government. What makes the free market great is that it takes people with bad intentions and makes them act good. I have no doubt the businesses I interact with don’t care about me in the slightest but willingly serve my needs to the best of their abilities because they want my business. If I go to a restaurant and get served meat that makes me sick I won’t go back. So a greedy restauranteur will not serve bad meat because he is greedy and wants to make money. Recently the gun background checks bill failed even though it was overwhelmingly supported by the american public. The reason it failed was that even though it was supported by most people, very few of them will vote based on it. NRA members will vote on it because they are the ones who care most about guns. This is the way with almost every issue, those who care most about an issue decide what gets done about the issue. Sugar planters care more about sugar policy than anyone else, so the US spends millions of dollars subsidizing the sugar planters. The big banks care more about financial regulations than anyone else, so they get bailed out by the taxpayer and the regulation are passed which help the big banks and hurt their competitors. The greed of the big companies combined with the power of the government hurts taxpayers, competitors and consumers. In a free market greed helps most people, in in combination with government power greed hurts most people. Since people are greedy the free market is the better system. ---
**Author:** ![Little\_Nemo](https://sea3.discourse-cdn.com/straightdope/user_avatar/boards.straightdope.com/little_nemo/32/3120_2.png) [@Little\_Nemo](https://boards.straightdope.com/u/Little_Nemo)\ **Post date:** [April 26, 2013, 2:47pm UTC](https://boards.straightdope.com/t/are-all-economic-ideologies-aside-from-free-market-randian-theory-obsolete/656625/77 "2013-04-26T14:47:25Z")
> [@BrainGlutton](#): > > And, economics being a science of a kind (less of one than physics, more of one than astrology), “theories” would be a better term than “ideologies.” The radical free marketeers are like virgins talking about their sexual prowess. Based on their theories about how sex works, they claim they would be great lovers if anyone was willing to have sex with them. ---
**Author:** ![adaher](https://avatars.discourse-cdn.com/v4/letter/a/dec6dc/32.png) [@adaher](https://boards.straightdope.com/u/adaher)\ **Post date:** [April 26, 2013, 2:50pm UTC](https://boards.straightdope.com/t/are-all-economic-ideologies-aside-from-free-market-randian-theory-obsolete/656625/78 "2013-04-26T14:50:45Z")
Perhaps, but last I checked, they’ve been scoring for 40 years. There’s been a lot of deregulation, not much in the way of re-regulation. Probably the banks come closest with Dodd-Frank, and that was only because they nearly went under. It’s the other side that’s impotent these days, thinking of the glorious time when the chicks dug central planning. ---
**Author:** ![Little\_Nemo](https://sea3.discourse-cdn.com/straightdope/user_avatar/boards.straightdope.com/little_nemo/32/3120_2.png) [@Little\_Nemo](https://boards.straightdope.com/u/Little_Nemo)\ **Post date:** [April 26, 2013, 4:27pm UTC](https://boards.straightdope.com/t/are-all-economic-ideologies-aside-from-free-market-randian-theory-obsolete/656625/79 "2013-04-26T16:27:26Z")
> [@adaher](#): > > There’s been a lot of deregulation, not much in the way of re-regulation. Probably the banks come closest with Dodd-Frank, and that was only because they nearly went under. So the banking industry was deregulated right up to the point where it was on the verge of collapse. At which time it was saved by being re-regulated. Or we could give the example of how the savings and loan industry was de-regulated right up the point where it was on the verge of collapse. At which time it was saved by being re-regulated. Or maybe how the energy industry was de-regulated right up the point where it was on the verge of collapse. At which time it was saved by being re-regulated. Or we could talk about Canadian girlfriends. ---
**Author:** ![Larry\_Borgia](https://sea3.discourse-cdn.com/straightdope/user_avatar/boards.straightdope.com/larry_borgia/32/156_2.png) [@Larry\_Borgia](https://boards.straightdope.com/u/Larry_Borgia)\ **Post date:** [April 26, 2013, 4:50pm UTC](https://boards.straightdope.com/t/are-all-economic-ideologies-aside-from-free-market-randian-theory-obsolete/656625/80 "2013-04-26T16:50:31Z")
> [@bldysabba](#): > > And, here’s an example of a market that exists without regulation (not saying that this is necessarily replicable, only that for your absolute statement to hold, you need to rebut this) - I’m not sure what the SCUBA example is supposed to prove other than that the SCUBA industry is capable of self regulation. I can think of a large number of reasons why this might be so. For one thing a failure of an air tank is going to affect only the diver, unlike a warehouse full of toxic chemicals where a failure can affect the whole town, most of whom didn’t voluntarily assume a risk like divers do. Furthermore the diving equipment industry serves a small group of professionals and affluent hobbyists. If a company makes shoddy failure-prone equipment it will be obvious and word would spread around the community very quickly, especially in the internet age. Said company would have zero sales and a number of civil suits on it’s hands. All this proves is that some industries do not need regulation, something only crazy extremists would deny. Otherwise it’s like saying that since Fluffy the cat doesn’t need to be walked, then Fido the dog doesn’t need to be walked either. That’s the problem with internet arguments about this complex topic. Regulations are difficult and it requires a ton of expertise to decide which work for a single industry alone. In the real world they will always fall short of perfection, either not sufficiently guarding the public from hazards or over-regulating and stifling a company’s growth. The issues can’t be reduced to “Regulations! YAY!” or “Regulations! BOO!” [Previous page](https://boards.straightdope.com/t/are-all-economic-ideologies-aside-from-free-market-randian-theory-obsolete/656625.md?page=3) [Next page](https://boards.straightdope.com/t/are-all-economic-ideologies-aside-from-free-market-randian-theory-obsolete/656625.md?page=5)