Economics/Class Relations

The Much Maligned Free Market

From Kyle’s Corner.


It’s official, the commies are winning. Recent Pew polls have shown a slow but consistent increase in socialism’s popularity, despite a 50 year Cold War fought ostensibly against the concept. Youth 18-29 years of age (AKA the future) now prefer socialism over capitalism, and one in three Americans at large now has a positive view of socialist ideology. On the other hand the term “capitalism” is falling from favor. Pollsters and tacticians are warning GOP mouthpieces against using the term and requesting instead that they use the phrase “free market” or “free enterprise”. The phrase “free market” is certainly more palatable to the public, but the growing hordes of commies have great animosity towards even this terminology. Why?

According to the commies and their sympathizers (which likely includes a significant portion of your family, friends, and neighbors) the free market is evil. If laissez faire economics is instituted in America workers will be “exploited”. Children will work in mines or perhaps as chimney sweeps a la Charles Dickens. They clamor for putting “people above profits!” and they constantly complain about the heartlessness of the market. They mock the invisible hand that Adam Smith spoke of, referring to it as superstitious nonsense. How little they know.

The Lockean concepts of private property and free markets have lifted large portions of the world out of destitution. What’s cruel, cold, and inhumane is opposing this great instrument of wealth creation.

Socialists will always criticize the market from a humanist perspective, as if they are truly their brother’s keepers. But they forget one simple notion; the market is composed of people. You can’t be for the people and opposed to the market. The market is merely a large group of people, mainly strangers, interacting with the aid of property norms, money, and business firms… for mutual benefit.

Thus the term “people before profits” is ridiculous on its face; people make profits. You don’t have profits, whether they are psychic or material, without people. If there is profit it is referring to a person that is receiving it. With a basic understanding of economics one cannot be opposed to legitimate profit (obtained from socially valued production). The only type of profit worth demonizing is rent-seeking but that distinction is never made by socialists. “People before profits!” What does this hollow socialist platitude even mean?

In one way or the other, the reds are always telling us that we’re heartless. Proponents of the Welfare-State will often point out that adherents of free market ideology resist their attempts at implementing State enforced charity. But, arguably, forced charity isn’t humanitarian; in fact it isn’t even technically charity. Faceless bureaucrats forcing you to give your money to faceless welfare recipients lacks the human touch of voluntary charity and it’s far less efficient. Welfare State bureaucracies absorb some 70 cents out of every dollar they receive, compare this to private charities with much lower overheads.

As for arduous child labor… that is the logical result of anti-market ideologies, not capitalism. The majority of human history is full of child labor, backbreaking poverty, and early death. The marketplace raised standards of living to the point where it was feasible to keep children out of factories and off the farm. For better or for worse, we can now afford to send our kids to school for 16+ years before they even start working. We have the free market to thank, or whatever semblance of a market that was allowed to exist, for ending grueling/dangerous child labor.

Chants of “exploitation” will be hurled at you during any debate with a socialist, but what does the word mean? To exploit is to use. In a marketplace, whether we like to admit it or not, strangers use each other for mutual benefit. I want to fill my car with gas and the gas station owner wants my money more than the gas in his pump; we use each other, it’s not so bad once you analyze it carefully. The same could be said of labor and other marketplace interactions. The employee values his wages enough to keep working for his boss, and the boss values the employee’s work enough to keep paying him money to show up. It’s that simple. Sure, the market is about exploitation, but it’s a two-way street. In voluntary market relationships both parties gain; what more could you realistically want?

There is a point to this tirade. Economic ignorance is dangerous; ideas have consequences, and the consequences of socialism are clearly proven throughout history. At this point in time advocates of socialism vastly outnumber knowledgeable defenders of the free market. For this ailing public I prescribe a large dose of Classical or Austrian economics, with a cursory overview of history, but the patient is heavily resistant to the medicine. A debt crisis combined with an ensuing depression is the prognosis for this condition, buckle up, this will get uglier. The trend does not bode well for the one-time bastion of free market economics.

70 cents line

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