Wednesday, December 3, 2008

Hyper-Capitalism: What Ever Happened to Free Markets?

by John Renesch

Market fundamentalists are fond of citing Adam Smith’s “invisible hand” theories as expressed in his book The Wealth on Nations, considered by many to be the sacred text of capitalism. Of course Smith could hardly have predicted the degree to which the market would be so manipulated as it has over the century and a half since he penned his 1776 book. Political lobbying and campaign contributions in the U.S. with the resultant government subsidies, tax advantages , changes to corporate law and other tilting of the free-market scale in favor of some to the detriment of others has created a market far from the unfettered model Smith had envisioned.

But that doesn’t stop the market fundamentalists from shouting “let the market resolve things”, “keep government out of the marketplace” and labeling any attempt to bring the scales back into balance as “socialism.” What market fundamentalists do not admit or wish to have known is the market is far from free. Special interests have sought advantages over generations so that those with the most to spend can effectively purchase preferred treatment by government decree and thus the rich get richer at the expense of the not-so-rich.

In effect what they are saying when they insist on keeping hands off the market is “don’t mess with the system that has been manipulated to our tastes” or, in essence, “we have the system customized to our advantage and we don’t want anyone messing with it.” Late comers might be saying “I have learned how to play with the present rules and I am doing quite well at working the system; please don’t mess it up because then I’ll have to learn a different way.” Either way, it is one-ups-man-ship, with a relatively small percentage of the population wanting to maintain its advantage over the rest of us. This tramples on the founding principles of equal opportunity, liberty and justice for all.


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