"The most powerful, proven instrument of material and social progress is the free market." Cite?

Great Debates
81

Well, for starters, it involved the government distorting the markets and telling businesses what they can and can’t do. Outlawing slavery is just another form of regulation and wage control, you know, those things conservatives hate. It was a progressive agenda that gave rights to individuals and the expense of the free market.

Imagine you’re a plantation owner in 1830 and looking to expand your business. But you are too worried that the government is going to start mucking around with your well established system. So unemployment starts to fall, and conservatives run on a platform of anti-government involvement. Let the free market sort things out. If people didn’t want slavery, they’d buy from plantations that don’t use them. They don’t need government telling them what to do, eventually slavery would have abolished itself. Sound familiar?

Lower and smaller than what? And to what point? Obviously 100% and 0% tax rates are bad. 90% and 2% also seem bad. What rate are we at now on your little system?

Those are meaningless words without any context, which is what the conservative movement is based on. It has taken the concept of “100% is bad” and projected it towards “35% is bad, so 36% must be REALLY bad.”

We’re not talking about raising taxes to 100%, it’s about moving from 35% to 36%. Money used to then balance the budget, which is used to make sure the system functions.

Failure to regulate is just as bad as deregulation. The Republican Party had plenty of time and plenty of options to prevent a massive economic collapse.

82

So did the Democratic Party.

Sam’s point is quite valid; the “Deregulation” people talk about simply hasn’t happened. The U.S. government has increased regulation at almost every opportunity, and not since the Carter administration has any industry been the subject of a substantial deregulation effort.

The machinations that resulted in the 2008 fiscal crisis happened in the midst of thousands of regulations that directly addressed the entities and instruments that caused the crisis. It would take you the rest of Obama’s term - and I fully expect him to be re-elected, by the way - to study and understand all the relevant law and regulation This land of Wild West deregulated free-for-all lawlessness people love to blame for all problems does not exist.

83

Okay, so we all agree that the Republican party increases regulations? When they talk about wanting small government and being good for business they are just lying?

Is that the conclusion here?

84

Government is an aggregation of the power of society in the hands of a few.

A free market is simply a form of economic decision making in which all participants have an impact on the greater whole.

I think it’s very obvious how one of those things can be a both the worst tyrant and best protector of liberties, but not obvious at all how the concept of the free market can actually compare to government in any meaningful way on either of those counts.

The only link I do see is that free markets create wealth, wealth creates prosperity, prosperity increases opportunity at self improvement and slowly, over many centuries history has shown that increases the number of educated people you have. The more educated people you have, the more desire there is for mass expansions of civil liberties and et cetera.

Historically governments and the powers that controlled them were not friendly towards civil liberties, because the aggregators of power wanted to share it not at all.

85

Could we also add that in a free market those with wealth and prosperity are going to work to maintain that wealth and prosperity? Essentially, in both cases, those with power are going to use that power to maintain their power.

It’s not hard to see in a free market how a company would grow and gain power, much the way a political party would. And once in power, it would work to stay there, much the way a political party would.

The key difference is that in US democracy, each citizen gets a vote, regardless of their wealth.

86

Um…those with wealth and power are ALWAYS going to protect and try t maintain that wealth and power. Regardless of the system. It’s actually going to be worse in most other analogues to a free market system that I can think of, to be honest.

In ALL cases those with power are going to use that power to maintain that power. This is basic human nature and really spans any system. Arguably, in most alternatives to the free market it’s going to be worse, not better.

Were/are their lips moving? Yes? Well, that’s the answer then. Of course, that goes for the Dems as well…

-XT

87

How so? What are the analogues to a free market system?

88

On the contrary; the problem was that almost no one was friendly towards civil liberties. But to the extent they existed at all, it was due to the government enforcing them. No government means no civil liberties whatsoever; only the law of the jungle.

89

I really dislike how some people think the term free market can only mean a totally unregulated, Wild West style market dominated by robber barons.

I think it really limits the ability to have discourse when you prevent absolutes between the Wild West and the supposed civility of “social democracy.” As I see it all of Europe is free market, with government regulations. Which hey, is the same as the United States.

To me a free market is about, primarily the individuals who participate in the market being the ones who ultimately are making the individual economic choices that determine “winners” and “losers.” An unfree market is one in which some sort of power gets to decide for the masses.

Example: I’m a business person, I run a small business and rent the property my business is in. My land lord charges a rent that I’m not happy with, I try to negotiate with him and he does not budge. In the free market, I am free (once I’m free of any lease agreements) to move my business elsewhere and to cease paying the land lord, and that is exactly what I will do if I find a place that will rent to me on significantly more favorable terms.

That to me, is a free market. It’s still a free market even though government regulation is involved (in things like enforcing contracts such as my lease agreement, and holding the land lord responsible for building codes and other things.)

Now, here’s another example:

I’m a farmer, in this case a serf in the year 1080. I do not own the land I work, it is owned by my seigneur (aka feudal lord.) In exchange for allowing me to stay on the land, and work it to feed myself and my family, I provide my seigneur with various things. Primarily he gets a share of everything I produce, however I also owe him “lord’s work” every week. This means for two days out of the week I have to work directly on my lord’s fields, or I have to work mending his fences or other such menial tasks. During this time I am unable to work my own land and it suffers because of it, but such is the way of things.

Not far from where I live, there is another lord who only makes his serfs work “lord’s work” for 1 day out of every fortnight. This is substantially less than what I am bound to with my seigneur. Additionally, this same lord takes a smaller share of each of his serfs harvest. It would seem that in the small microcosm of my world, I’m in a situation where my product (essentially my labor) is being valued very differently by my “boss” than it is just next door by someone else’s boss. In a free market, I can leave and go live on the other lord’s land and work for him. However, this is not a free market. I do not have the legal right to leave the land, me and all the generations that come from me are permanently bound to this land. If you look over the macrocosm of the world that I live in, all the seigneurs and et cetera, you’ll notice this situation repeated over and over. Many seigneurs require more work from their serfs than mine, many require less. It really is entirely up to their whim.

Even if my seigneur terribly mismanages his affairs, there is nothing that would ever see him lose his lands. He can’t have his lands seized for being unproductive, he won’t be driven out of “business” because his only business is running the land as he sees fit and providing some minimal level of law and order. Occasionally he’ll have to send some men-at-arms to his lord for various military campaigns. Since the only individual with any authority over my seigneur is the person whom he is vassal to, and that person only cares that he gets his scutage (a small amount of money/goods that a lesser lord traditionally would pay the greater lord to whom they were a vassal, this ranged from being nonexistent to being a moderately large amount based on place, time, and etc) and that he gets his men at arms when needed.

So, I don’t see the “regulated market” and the “free market” as two different extremes. For some reason people really like to paint that picture. I see the free market as the modern market, the market in which individual participants make the decisions, not a few powerful men. As society progressed, you saw more and more control over economy become centralized, not decentralized. In 1066 England there was no such thing as central economic policy. People somewhat uninformed about history will look at historical maps and presume there even was a county called “England” and “France” back in 1066. That was never really the case. There were “regions” that roughly had those names and some level of shared culture and language. However, they were not unified states. For a long time the King of France or the King of England was little more than a “first amongst equals”, the monarchy didn’t represent a state but just the greatest title in a given region held by typically the most powerful dynasty (although sometimes there were greater dynasties than the royal, and usually if that persisted long enough the reigning royal dynasty would be supplanted.)

Fast forward five or six hundred years to the end of the Middle Ages / beginning of the Renaissance and you see real states. States with true power over the entirety of their domains, and with that power came centralized economies. Usually powerful bureaucrats working directly under the monarch would have vast authority to regulate the country’s markets. Mercantilism can be seen as the infantile version of the free market. Mercantilists believed that wealth could not be created, only exchanged. The only way wealth could be created was by discovering new wealth, such as new land or new deposits of bullion. So a mercantilist would see colonization as a means of increasing a nation’s wealth. A mercantilist would not see an entrepreneur developing new, more efficient mining techniques as someone who was creating wealth.

Mercantilists basically felt that all natural resources should be turned into finished goods within the country they were extracted, and all bullion should be mined and should never be parted with. Rather the goal of nations should in fact be to take as much bullion from other countries as possible. Such a policy is obviously anathema to individual choices and freedoms. In a free society the government does not have the right to tell you that you must sell your raw materials to only local manufacturers. In a free market the government will not force such a thing by fiat (meaning by law/force) nor will it force the matter by creating ludicrous trade barriers that have the same effect. Mercantilist societies loved the granting of monopolies, for a variety of reasons (usually a mixture of collusion between government authorities who were also shareholders in the monopoly along with a general way of thinking that said government granted monopolies were a better solution than having multiple companies vying for a slice of the pie.) For the common man one of the biggest truths about mercantilism is it really was a two hundred and fifty year collusion between government and business to the absolute detriment of the consumer.

People I think view the 19th century and early 20th century as “too representative” of what a “free market” really is. In truth, despite any and all abuses that happened in the 19th and early 20th century, the 19th century was better for consumers, workers, and business than all centuries that came before. The 20th century was immeasurably better for all three of those entities than the 19th, and most likely the 21st will be better still. Any abuses that muckrakers wrote about at the beginning of the 20th century were probably totally unremarkable in the 1700s.

Markets becoming free (meaning consumers pick the winners and losers, not government) was not some global, smooth process. It did not happen uniformly, it did not happen suddenly, and it didn’t even happen everywhere at the same time. Some places it still hasn’t totally happened. What this means is, analyzing the move from the command/collusion style economy of ~1500-1760s and beyond to the modern free market isn’t something that lends itself well to sweeping generalizations, it requires nuance and lots of time and effort. Most people who talk about these things today are doing so to try and advance a political point in relation to the politics of today. This leads toward people making statements that are just totally out of whack with reason and dramatically out of whack with the truth.

Sometimes the power of entrepreneurship and free enterprise ran too far, and government had to step in. This is because major changes don’t happen without major mistakes, major setbacks, and all that those imply. However, a government regulating a market does not make it unfree, it just makes it regulated.

I’ll liken it to the term “free society.” Would anyone argue we do not live in a free society because police officers can ticket us for speeding? Or because we have to obey basic traffic signs? I doubt it.

Another analogy can be made to the tread pattern on a tire. In some forms of racing a “slick” tread is used (basically a totally smooth tire), this has advantages in some forms of racing. A fully unregulated market is sort of like that, and it will definitely be more efficient in “perfect conditions” than a tire with a normal tread pattern or a tire with a tread pattern designed for specific weather conditions. The problem is, if you tried to use one of those tires off a race course and in the real world, and a rainstorm hit, you’d be in bad shape. You’d be in worse shape still if you hit a snow storm and had to deal with ice and other inclement weather. Regulation can provide stability where naturally it would not occur. The amount of regulation that is ideal, where it is ideal, in what ways it is to be applied, that is the stuff that entire societies will argue about probably til long after we’re all dead. So let’s not fool ourselves that any of us have the divine truth on that, but all I know for sure is a free market shouldn’t be thought of as synonymous with “unregulated.” To me a free market is a market free of the centralized planning, collusion, insane levels of regulation, arbitrary trade barriers and all the other things that were characteristic of mercantilism and other pre-modern economic systems (such as seigneurial manor economies and et al.) I think that that is also sort of how the term was originally intended, too. I don’t believe Adam Smith was an “anarcho-capitalist” or is someone who you’d find supporting the “extreme laissez-faire” system that some hardcore libertarians of today espouse.

90

While I think democracy and free markets are good bedfellows, I don’t think you’re saying much of substance about them in this post.

Yes, power tries to maintain power.

Yes, in a democracy, each citizen gets a vote.

I guess I’m missing the relevance. I guess maybe you’re trying to say that in a free market the evil rich people will rape all the poor people to death, and only a liberal democracy can protect its people?

Well, I don’t believe free market = anarcho-capitalism, nor do I believe that government is the best entity to keep corporations behaving well. In a free market where consumers get to pick the winners and losers, it really is the consumer that is best equipped to handle corporations that do not do things to the interest of the customer.

Before free markets, under say, mercantilism, a group of rich guys who wanted to create some company that would be a monopoly over some key resource or market only had to have a few connections and boom, it was done. For example if I was part of the peerage and had a few powerful friends, in the 1600s in England I’d be able to bend the entire system to my personal benefit. When the government has vast control over the economy, the “power elites” only have to control a few (relatively speaking) people in government itself and they essentially have the keys to the kingdom.

In a free market, where government does not have immense power over the economy, you can own every congressman and you still can’t force people to buy Zunes instead of iPods.

91

That sounds like a fair theory to me. You’ll note they’re also the party that claims to be all about fiscal responsibility, and then when elected spend money faster than a drunken sailor in a whorehouse.

92

I’m fine with bashing of either of America’s political parties. But I’d like to note, in the context of this thread, both parties are supporters of a free market.

93

Because when people start ranting about the virtues of the free market, that’s almost always what they are pushing for. No regulation is ever good, no aid for the unfortunate is ever good, no atrocity committed in the name of profit is ever worth concern.

We already have a regulated free market after all, so if that’s what someone considers a free market, they won’t be agitating for what they already have. So yes, when someone starts to praise the free market as The Greatest Thing Ever the thing to bet on is that they are some sort of anarcho-capitalist.

94

Fine post as always, Sam.

Not only are the posters to whom you reply “not aware” of things that you are trying to explain, I’m sure that they themselves make far more choices than they realize without the benefit of government. All the time. They are closet free-marketeers without even realizing it.

The example I constantly bring up is the FDA and it’s role in food safety. We’ve gotten into endless debates on this Board about how the FDA is absolutely essential…otherwise we would all die immediately from poisoned food and/or drugs.

But the statists and leftists on this Board travel to Mexico quite often. And to Indonesia. And South America. They talk about the great times they have had on these trips. And the restaurants they went to, and the food they ate.

Wait. What?

They ate food, or visited a restaurant, in a foreign country? And not even a G-8 “modern” country? How could they? The FDA didn’t inspect that restaurant’s operation. How come all the tourists and locals who dine there aren’t dropping dead like flies on the street?

It’s simple. They are taking all of the cues you refer to above, in your post, into account and making a decision accordingly. And dealing with the risk level that brings with it. Just like any reasonable person would.

The appearance and cleanliness of the place, whether it looks like it’s been there for a long time and is well-established, perhaps even advertising or a recommendation from a trusted source. They take all these factors into account and make a decision. Just like you or I would.

But suddenly, back in the good ol’ USA, we are at the risk of death without the government to protect us and tell us what choices are OK and which ones are not.

Amazing cognitive dissonance on display. Which is also pretty typical of the SDMB.

95

Can you at least provide some examples on the SDMB? I mean, otherwise you’re just making up straw men. Who are these people who want lawless capitalism? Any around here?

96

<Points at IdahoMauleMan directly above RickJay>

97

Again, we’re back to having cake and eating it too. You’re twisting the definition of free market to suit your needs. As you say, it has some regulation, but not too much. But that’s really the point.

The point of this thread is to address the very specific agenda put forward by
http://www.freedomworks.org/blog/max/the-mandate-the-contract-from-america

"The most powerful, proven instrument of material and social progress is the free market. "

Which seems to be false. It’s not free market, it’s a hybrid system where the government has a role to play. A rather large role, as illustrated by your reference to socialist Europe.

So while YOU specifically might have enough common sense and integrity to realize free market has boundaries, others don’t. The result as I see it is that “free market” now means that regulations liberals propose are bad, but regulations conservatives propose are good. And no, I’m not attributing that to you specifically.

It goes back to that statement, “businesses aren’t hiring because they are scared of what Obama might do.”

There is something about Obama’s regulations that are anti-business, but some how the regulations conservatives institute are pro-business. That’s the message conservatives are pushing when they use the term free market.

Said in a better way, we’ve established that government has a positive role to play. That we could draw a curve where as the size of government increases, the benefits of the free market are heightened. Up to a point where too much government makes things bad, and then we start going down the other side. With that in mind, the proponents of “small government” are full of shit, and simply selling unregulated snake oil.

Exactly, some sort of power. When some sort of power can decide for the masses, markets are unfree. Be it government or private industry, the result is the same.

98

I don’t think anything in my definition of “free market” is significantly out of whack with most of the writings of Adam Smith. Like I’ve said, I’m not an anarcho-capitalist and I don’t think it’s fair to equate all concepts of free market with that.

Further, I don’t see any country in Europe as being socialist. They’re all free market countries with large social welfare systems.

And when I talk about “deciding for the masses” I’m talking about individual consumers being able to make economic decisions for themselves. In a closed market, there is limited to no competition, so there are no real decisions to be made (other than buy or not buy, and in many markets you have to buy in reality.)

99

So those people are wrong and a small majority.

What people are typically against is OVER regulation. The more regulation, the more hoops you create for businesses to jump through, the more difficult and costly you make it for businesses to operate. Not to mention that regulation can also open the door for corruption. It provides petty beurocrats with the power to arbitrarily dole out favors and restrictions through selective enforcement.

Businesses aren’t “scared”, they are “uncertain”. It is the difference between risk and uncertainty. Risk is quantifyable. Uncertainty is not because it is unknown. If companies know what the health care regulations will be over the next year, they can plan and budget for it. But if they believe their health care costs will increase be some unknown amount, they will hold off on making any decisions because they won’t know how to plan for it.

100

So Idahomauleman is in favour of the abolition of the government and the rule of law, is he?