Free-market fundamentalism

Jimm at Project for a New Century of Freedom opines on free markets:

Meditating on the power of markets to solve all problems - it's a lie, because these market defenders only believe in free markets selectively, for economic benefit, and not for political and cultural markets (exchange). They overemphasize the economic sphere, underemphasizing or denigrating the political, cultural and spiritual, and in the process end up with a skewed worldview that inevitably greatly favors those with more economic capital.

Thus, economic capital is power, and the bigger the better. This favors corporate governance of the world, not just America, and since the nature of corporate charters is highly authoritarian and has very little to do with the stuff of democracy, and America, these market philosophers are not patriots, and are not defenders of humanity, human values, self-government, inalienable rights, or the American Dream.

Fundamentalism and free markets do not mix, of any variety. Be it religious fundamentalism, or economic fundamentalism, the results will be the same. Skewed markets, and overemphasis in one sphere over another. We need a separation of human powers - cultural, political and economic - in order to duly respect the full sense and experience of humanity, and ensure life and happiness, liberty and justice, security and decency, to everyone.

Speaking as an unbashed advocate of free markets, I believe Jimm has some misconceptions of what values free market enthusiasts hold. As with any political debate, definitions have to be established first or else the sides end up speaking past each other.

Starting with the very basic of basics, there are only two ways in which two individuals can interact with each other. One way is when both interact in a mutually agreeable manner. The other way is when one interacts with the other in a manner which the other does not agree to. The former is a voluntary interaction whereas the latter is aggression by the offending party.
The sum of all voluntary interactions is called civil society. Me and you meeting for lunch. Hokies tailgaiting before a game. Me buying a bagel for breakfast. You watching a movie with friends. Civil society is the kosmos that results when individuals are protected from aggression, and gives rise to culture, morality, art, tradition, mores - the very heart of civilization.

Within civil society, the free market is the sum of all actual and potential voluntary exchanges in any society. Simple as that. Me exchanging my $10 for a mushroom pizza. You exchaning your 50 fish for 3 logs. Me holding out for a lower price on a used car. In totality, these exchanges result in the free market.

Aggression comes in many forms, and it involves involuntary interactions, such as theft, murder, fraud, extortion, etc.

Why am I an advocate of the free market? Because at its root, it is ethical. It is based on voluntary interactions rather than aggression. No guns are used. When you hold a gun to someone's head to make them do what you want, you are profoundly debasing their very humanity and sinking into the Law of the Jungle. That is the highest form of selfishness. No matter how big or little the person, how light or dark, how rich or poor, or how annoying or charismatic, individuals are owed freedom from violence out of respect for their free will.

Free markets aren't really any 'special entity' or 'invention' or 'policy'; they are simply people freely exchanging their stuff. Really. Yet, this very natural phenomenon is feared and loathed by millions. Are people freely exchaning their stuff going to make life on Earth perfect? Are people freely exchanging their stuff going to make sunny days in Seattle? Are people freely exchanging their stuff going to turn lead into gold? No, and I do not make those claims. However, people freely exchanging their stuff does respect the other person's autonomy. That is true self-government. Not only that but it makes people better off in their own lights and creates wealth, which is one study of this blog.

I admit it. I am a free market fundamentalist. There is no shame in a zealous advocacy of respecting others' free will. Either individuals interact voluntarily or involuntarily. There is no in between. The alternative to a fundamental belief in individual autonomy is an espousal of involuntary relations. History has shown that road to be paved with human suffering.

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Jimm, Thanks for the civil

Jimm,

Thanks for the civil response.

For instance, though we have many libertarians fighting for lack of government interference in business, in terms of capital and regulation, we hear very little active and persisent defending of the free movement of labor.

Why? Because we have to deal with the political sphere, which will not for any conceivable period of time extending into the future allow the free flow of labor independent of national political concerns. It's not wrong to stem this flow of labor, except if you refuse to see the world, and its reasonings, beyond the lens of economic free market theory.

I'm not exactly sure what you are referring to - perhaps the shift of production in various industries overseas?

Another example. Child porn. Are you advocating the free exchange of child pornography? No. Why? Because it's wrong. In the cultural and political spheres, the vast majority would never allow it.

'Wrong' has many levels. For example, I think it's wrong for a bride to leave a groom at the alter, but I won't pass a law against it. Yes, I am against child porn, but not simply because it's 'wrong' but rather it is aggression against children. Children cannot give consent to some voluntary actions.

That does involve harms, if you really want to get nit picky, so a better example is in order. Prostitution. And crack. Economic free market advocates should see no wrong with these free exchanges, unless you want to argue that there is an addiction involved (which, at least in the case of crack, is likely).

Do I think people should smoke crack? Probably not for most people. But when a crack user exchanges his money for crack, he is doing what he values, even if that value is repugnant to me. If I do not like what he values, I can try to persuade him to change his values, but in the end, it is his choice and he is the one who bears responsibility for his actions. I am not about to hold a gun to his head to make him stop, for that would be a gross violation of his free will, no matter how distasteful I find his behavior. Same with prostitution. Morality is a function of civil society, not the political sphere.

Words like 'wrongs' and 'harm' are vague and non-specific. Actions can be 'wrong' in a moral sense (such as perhaps using women in bikinis to sell cars) but if everyone involved is making their own choice, it would be highly arrogant of me to force them make choices that I believe they should make.

With regard to corporate activity, I hold protectionism and corporate welfare with disregard. However, simply large size should not make a business a target for political action. Bill Gates is not harming me. In fact, he is rich for the very reason that he makes people happy with what he produces to exchange with others.

We are closer to agreement

We are closer to agreement than you might think. I'm not sure how it's come to be, but I agree with your post almost entirely.

It is about free will. And, to be honest, I am a fierce defender of free market theory. But an expanded free market theory, and one that realizes that partial implementation favored to one sphere of activity, in my criticism the economic sphere, doesn't work, and really just mucks everything up.

For instance, though we have many libertarians fighting for lack of government interference in business, in terms of capital and regulation, we hear very little active and persisent defending of the free movement of labor.

Why? Because we have to deal with the political sphere, which will not for any conceivable period of time extending into the future allow the free flow of labor independent of national political concerns. It's not wrong to stem this flow of labor, except if you refuse to see the world, and its reasonings, beyond the lens of economic free market theory.

Another example. Child porn. Are you advocating the free exchange of child pornography? No. Why? Because it's wrong. In the cultural and political spheres, the vast majority would never allow it.

That does involve harms, if you really want to get nit picky, so a better example is in order. Prostitution. And crack. Economic free market advocates should see no wrong with these free exchanges, unless you want to argue that there is an addiction involved (which, at least in the case of crack, is likely).

It is not economic free market theory that would argue against such activity. It is the cultural sphere, delving into the political sphere. Since this doesn't really involve harm, in the classic sense of the term, we see that the political sphere is fed from a few angles. Legal theories revolving around harms, and cultural norms that are too strong to deny.

I'll wrap up. Selective defense of free market theory is practically meaningless. It's Walter Mitty. The world works differently. Ideally, we would have free markets and flows in all spheres, free of prejudice and outdated norms. There will always be tension between the spheres, however, such as with child porn, prostitution, and drugs, and these are norms that are not outdated, and are in fact quite legitimate.

When I hear defenders of economic free markets and unfettered corporate activity also defending full transparency in government, electoral reform, and other measures that would free up the political market, then I will be more trusting of the rhetoric they expound.

Jonathan, we agree on much.

Jonathan, we agree on much. Most of my arguments, like about crack and prostitution, are not really targeted at you. You are a good liberatarian. A real one. Consistent.

There is another breed out there who love talking free markets. But only in regards to the economy, and nowhere near advocating allowing vices to be decriminalized.

These are the people I am criticizing. And you're right, big isn't necessarily bad, but I do believe it can get to a point where the big becomes Big, and the corresponding power is of a different degree than the other competitors. This would result in distortions of the free market, and its agents, from another angle.

And I don't mean to be

And I don't mean to be condescending by the "good" libertarian. Upon reread, I see that as a possible interpretation. Just mean that you're a spot-on libertarian, rather than one of the fakes.

These are the people I am

These are the people I am criticizing. And you're right, big isn't necessarily bad, but I do believe it can get to a point where the big becomes Big, and the corresponding power is of a different degree than the other competitors. This would result in distortions of the free market, and its agents, from another angle.

Big becomes bad when Big influences the arm of the state, but it cannot harm me outside of that because it does not use force as it means. I always have a choice. I could decide today never to interact in any way, shape, or form with anything Bill Gates has made, and he couldn't do anything about it. That is simply not true with political structures.

With regard to Big's influence on competition, we simply disagree about its negative effect towards competitors and consumers.

I wanted to ask you however, when you stated in your original reply, "Why? Because we have to deal with the political sphere, which will not for any conceivable period of time extending into the future allow the free flow of labor independent of national political concerns. It's not wrong to stem this flow of labor, except if you refuse to see the world, and its reasonings, beyond the lens of economic free market theory," I assume you mean the effects of shift of production overseas. If this is the case, isn't that inconsistent with being critical of corporate favoritism? Stemming the flow of labor overseas means giving corporations special privileges and protections.

Actually, I mean the free

Actually, I mean the free flow of labor and immigration. Economic free marketeers are notorious for defending the free flow of capital and trade, and securing political support for it (even though this support can be challenging to get), but conveniently drop the free flow of labor, because it's pretty much politically impossible.

This results in distortions in the overall operation of a free market, however. Why? Because labor is not so easily removed from the equation. Imbalances result, and give undue influence to Big interests who can smooth with cash and incentives the political leadership of wherever they happen to be.

In the case of when they're in a repressive state apparatus, things can get too easy. Bribes come too easy, as transparency and political involvement of the people is at a minimum.

Along with this imbalance, more distortions occur because of the political imbalance that results, independent of any interest actually greasing the wheels. Because the citizens of a state may end up almost being hostage to these free flows of capital, investment and trade, but are themselves restricted in their free movement by national and immigration norms, there is political unrest and reaction against capitalism that is inevitable, and totally unnecessary if sensibly implemented with recognition of its limits.

And the restriction of movement by labor, and thus the "hostage" situation to global business interests, also leads back once again to the imbalance between capital and labor, and the resulting distortions of the free market that never really get honestly analyzed by most popularizers of economic free markets.

The bottom line is that until labor is given free movement and flow, there really is no free market, per se. It is only relative. And relatively skewed, and favored, on the side of capital.

And for those people who live in a repressive state apparatus, there is not even a semblance of a free political market with which to ensure their fair treatment and collective bargaining power. Thus, investors have an unfair advantage here as well, in using a severely distorted political market, which is not free, to their advantage, since there is no limit to their ability, as the investors behind the corporation, to collectively unite their interests.

And the idea that this will eventually help the people in these political markets, to interact with this kind of capitalism, is phoney baloney, in most empirical cases in the past 20 years.