Sunday, February 14, 2021

There is No Such Thing as a Free Market — Ron Driver

Nice short summary of why "free market" is BS used for persuasion.

It begins with a misrepresentation of Adam Smith (as Michael Hudson tirelesslyy points out).
Supporters of ‘free’ markets use the word ‘free’ to mean free from government interference. They often quote the economist and philosopher, Adam Smith, who wrote about the ‘invisible hand of the market’ creating good outcomes for society. However, his writing has been deliberately distorted to turn it into propaganda. Smith used the word ‘free’ to mean something completely different. He meant free from big companies and wealthy landowners with too much power, who could make unearned profits (these are sometimes called economic rents, or ‘free lunches’, discussed in later posts.) Smith was all in favour of governments interfering to stop companies gaining that power, and to stop them making excessive profits.
That is probably an excessive statement. Smith wanted government out of the business of micromanaging the economy, including trade, but as a philosopher of human nature, he was well aware that the regulatory function of government was needed to discipline excessive pursuit of self-interest as a primary motivation in commerce. He was also aware that government can be suborned to favor class interests.

Smith was arguing for an enlightened liberalism rather than promoting laissez-faire. He realized that there are two great power blocs – government and business. The should balance each other rather than one bloc dominating. 

While Smith did not foresee it as far as I know, the worst of all worlds would be an unholy alliance of the two blocs, which history shows can take different totalitarian forms. The present challenge is totalitarian international corporatism that captures and suborns states.

The real economic problem the world faces now is not supply but rather distribution skewed by economic rent and rent extraction through exertion of power. Market power is often the result of political power, for example, anti-competitiveness, artificial scarcity and externalities.

16 comments:

Andrew Anderson said...
This comment has been removed by the author.
Andrew Anderson said...

The real economic problem the world faces now is not supply but rather distribution skewed by economic rent and rent extraction through exertion of power. Tom Hickey

Yes, and unethical finance is a major cause of that. Another is no limits to land ownership. Neither are according to the Bible, btw.

Nor is the MMT School interested in ethical finance either but would attempt to perpetuate UN-ETHICAL finance via INCREASED privileges for private depository institutions, aka "the banks."

You've hitched your wagon to an unjust cause there, Hickey.

Peter Pan said...

Unholiness is next to happiness, as far as alliances go.

Ahmed Fares said...

In the process of division of labour, the employment of the far greater part of those how live by labour, that is, of the great body of people….The man whose whole life is spent in performing a few simple operations, of which the effects are perhaps always the same, or very nearly the same, has no occasion to exert his understanding or to exercise his invention in finding out expedients for removing difficulties which never occur. He naturally loses, therefore, the habit of such exertion, and generally becomes as stupid and ignorant as it is possible for a human creature to become.

But in every improved and civilized society this is the state into which the labouring poor, that is, the great body of the people must necessarily fall, unless government take some pains to prevent it.


[Man falls] into that drowsy stupidity which, in a civilized society, seems to benumb the understanding of almost all the inferior ranks of people.


—Adam Smith (The Wealth of Nations)

Tom Hickey said...

[Man falls] into that drowsy stupidity which, in a civilized society, seems to benumb the understanding of almost all the inferior ranks of people.

Smith appears to be wrong about this condition he observed at the time as being due to a natural tendency. According to Peter Gray, the author of the following article, elites suppressed the natural tendency to learn for the creation of a subservient and obedient work force. The primitive condition of the workers in comparison with the lite was artificial and imposed rather than being natural.

Peter Gray observes that while knowledge has become more economically valuable owing to the rise of technology and the need for highly skilled workers, hence promoted by both business and the state, the old methods are largely still in place, even though most government have required general education and established institutions for delivering public education and suited education to the needs of modern business.

Interesting and relatively short.

https://www.psychologytoday.com/us/blog/freedom-learn/200808/brief-history-education


jrbarch said...

Yes! The fledging eagle flaps and flaps its wings, building up muscle strength, getting ready for the day it can fly – that is its nature. Finding it’s self.

Then it can see what is going on, for miles and miles around.

Schools tell the eagle it has to be a postman. ‘That’s your destiny son – become a postman’.

So, why all the plumage and tail feathers and wing feathers then? Why the urge to flap them? Why the urge to soar?

Absolutely, no urge to be a postman? Seems really unnatural.

Hmmm! Could it be ...

Peter Pan said...

As a follow up to The Con documentary, Real Progressives is starting a new series:
The New Untouchables: The Pecora Files [Series Trailer]

Amplify the message if you can.

Mike Norman said...

I've said this, written about this, made videos on this, for years.

Matt Franko said...

That’s all BS...

Ahmed Fares said...

"There is nothing so stupid as an educated man, if you get him off the subject he was educated in." —Will Rogers

Ahmed Fares said...

Also, Jewish space lasers, fake school shootings, supporter of QAnon, etc.

Marjorie Taylor Greene was born in Milledgeville, Georgia, on May 27, 1974, the daughter of Robert Taylor. She graduated from South Forsyth High School in Cumming, Georgia in 1992, and the University of Georgia with a Bachelor of Business Administration in 1996.

Maybe she's smart in business.

Ahmed Fares said...

jrbarch,

God has sealed the eyes of some people so they can cultivate this present world. If no one were blind to the other world, this world would be empty. It is this blindness that gives rise to culture and progress. Consider children, how they grow up recklessly and become tall, but when their judgement reaches maturity they stop growing. So the cause and reason for civilization is blindness, and the cause of devastation is sight. —Discourses of Rumi

Andrew Anderson said...
This comment has been removed by the author.
jrbarch said...

Yes, Rumi knew the inner world.

“I searched for God among the Christians and on the Cross and therein I found Him not.
I went into the ancient temples of idolatry; no trace of Him was there.
I entered the mountain cave of Hira and then went as far as Qandhar but God I found not.
With set purpose I fared to the summit of Mount Caucasus and found there only ‘anqa’s habitation.
Then I directed my search to the Kaaba, the resort of old and young; God was not there even.
Turning to philosophy I inquired about him from ibn Sina but found Him not within his range.
I fared then to the scene of the Prophet’s experience of a great divine manifestation only a ‘two bow-lengths’ distance from him’ but God was not there even in that exalted court.
Finally, I looked into my own heart and there I saw Him; He was nowhere else.”
[Rumi]

In this world people are taught to grow and chase the ‘I’ instead of the self. Because there is no knowledge of the self, even nations fight one another. It’s an asylum... everything seems more important than the truth. Then you die.

Andrew Anderson said...

Finally, I looked into my own heart and there I saw Him; He was nowhere else.” [Rumi]

Otoh, "Do you see a man wise in his own eyes? There is more hope for a fool than for him." Proverbs 26:12

Ahmed Fares said...

Andrew,

The proverb you quoted refers to exoteric knowledge which comes from books. The discussion here is about gnosis which comes directly from God in the state of ego death, i.e., death and resurrection in this life. Here, faith is replaced with certainty. This is the esoteric side of every religion.

A few sayings from Rumi, who is a Sufi master, should make it clear that this is not book knowledge, especially the first quote below:

The sufi’s body is not of ink and letters;
it is nothing but a heart white as snow.
-ibid., ii, 159

How much the Beloved made me suffer
before this work sealed into the eye's water
and the liver's blood.
A thousand fires and smoke, and its name is Love.
-Rumi: Divan, 12063

The unsuspecting child first wipes the tablet
and then writes letters on it.
God turns the heart into blood and desperate tears,
then writes spiritual mysteries on it.
-ibid., ii, 1826-7


source with more Rumi quotes: balance10: stanzas from Rumi (translated by Helminski)