Think about this. Free Market Capitalism and Communism are two systems that have been tried and have both seemingly failed... or have they? (I say failed for free markets in reference to such occurrences as the Great Depression and the Great Recession of now, and failed for communism in reference to... every communist country ever) Well, every proponent of both systems has basically the same argument: "Oh, well that example wasn't actually in a system of communism/free markets!" Think about it. Any radical leftist will say that the Soviet Union wasn't actually a communist country, but that it was a flawed dictatorial state socialist country or some other form of words like that. They will say that real communism has never been tried and therefore we can't judge it and say it was a bad idea. Similarly, proponents of a free market system say that the failures of the American economy under so-called "free markets" (as during the Great Depression in the 1930s and in the financial collapse of the late 2000s and now), cannot be attributed to the failings of free market capitalism because in reality we never actually had a free market system to begin with. Wait, what?
Ok, let's go back just a bit. Just a few years ago, the economy seemed to be doing just peachy (in fact it seemed to be doing super fantastically) and at the time politicians and pundits and economists were saying that this was the triumph of the free markets... in other words the triumphs of globalization, free trade agreements, the de-unionization of American Labor, the deregulation of the economy (and particularly the deregulation of finance), etc. etc.
However, now that the bottom has fallen out of the economy, unemployment is skyrocketing, consumer spending is dwindling, and the world is seemingly collapsing, it seems as if those who once heralded the age of free markets are now screaming about how the collapse was caused by the very fact that we didn't actually have free markets. Now the idea is that of course free market capitalism didn't kill the economy, it was actually the fact that government intervention is STILL too heavy in the economy.
The fact that most of the regulatory boards that had once kept a close watch over the economy were castrated by the "Neoliberal" Republican Agenda of the last 30 years seems to be completely irrelevant. The regulatory systems that were put in place a long time ago were being run by members of the very industries and companies they were supposed to regulate (this is exactly what happened in the case of the Gulf Oil Catastrophe and the MMS). So in the end, I cannot imagine how government regulation can be seen as the reason that the financial sector collapsed bringing the economy to its knees.
But putting aside my rant for a moment, I just want to point out what this as taught me: just like real communism, real "free market capitalism," in which the government has ABSOLUTELY no role in the economy is a system of ideals that will never be put in place ever, and so we will never really know if it is as perfect as they say it is. The reason being is this: free market capitalism leaves nothing in control by anyone. It is quite literally the system of freedom. That, however, is a problem for governments simply because it is duty of the government to protect the people. What would be the point of having a government if it could protect you from invaders but not from let's say the changing course of the times? The very nature of the invisible hand, like God, is the "give and take." If a government is meant to preserve the "general welfare," as the constitution put it, then it cannot avoid the problems that might arise if the markets were allowed to be entirely free and therefore free to potentially screw over the country in natural economic downturn.
The free marketeers have a point. Look at any point in American history when there was a major economic catastrophe and most likely it was caused by some kind of market manipulation by outsiders (read: government). For example, in all of my liberalness, I've often cited the existence of robber barons during the late 19th century as being a sign that free market capitalism was a bad thing; however, the economy of the late 19th century was not actually a free market because (throughout US history, in fact) there have always been large import tariffs mandated by the government in order to protect domestic industry. This is called Protectionism. So in other words, robber barons, one could argue, had the opportunity to become so filthy rich because their industries were being protected against foreign products. That is just as anti-free market as any regulation that was put in place during the 20th century.
(I realize now after paragraphs of writing that i must specify what i mean when i say "free market capitalism." I am not referring to the free market capitalism that simply fosters private ownership of property and of the means of production. I am referring to the "free market capitalism" that conservatives and libertarians peddle... the definition of free market capitalism as a system of private ownership and enterprise that is entirely unregulated.)
I could probably say more about this but for now... i'm exhausted.
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