A very nice, concise overview:
Free market ideology has so pervaded our culture that we aren’t even aware of it. It is incorporated in the very language we use to discuss anything vaguely economic.
Free market ideology has so pervaded our culture that we aren’t even aware of it. It is incorporated in the very language we use to discuss anything vaguely economic. Education is a good illustration. We used to “nurture” our children and prepare students to be responsible and productive participants in the democracy we claimed to be. Now we “invest” in them and prepare them for the workplace. Many people in the both established parties look to competitive models like charter schools and “choice” to fix everything – even though there’s no evidence these actually improve learning. Rather than looking for caring and capable teachers, we want to align their incentives and measure their value-added.
Let’s face it, the self-made billionaire is a myth. All successful people have benefited from both good fortune and support from society and government. Did Steve Jobs cleverly choose parents who lived in Mountain View, California where he would get good schooling and happen to run into the inventor of the Apple? Would his career have been equally successful if he had been born in Mountain View, Oklahoma? And how successful would he have been if the government and non-profit institutions had not collaborated to create the internet? Is the fact that Silicon Valley billionaires are almost all white men a sign that white men are more meritorious by nature, or is a more likely explanation that they get the opportunities to succeed where others don’t?
And a little history:
Another presumption implicit in the pro-market argument is that “a rising tide lifts all boats”. The 1950s and ’60s were a period of growth which was widely shared. This rising tide did help most Americans. Wages grew at a reasonable clip and poverty declined. Markets were part of the story but so was government, the New Deal, and for that matter, labor union power. Income was taxed at rates up to 90%. The banking system was very heavily regulated.
Then, the free market ideologues began to make political inroads. In the 1970s and increasingly in the ’80s and ’90s, banks and other industries were deregulated and taxes, particularly taxes on capital, were decreased. Ronald Reagan famously broke union power. What happened? As you can see in the graph below, there was no improvement in economic growth as shown by productivity (output per hour worked). But, even worse, wage growth completely stagnated. So, lower taxes and bank deregulation did nothing for economic growth. But they did allow the 1% to grab virtually all of the growth that did occur. And, the situation of the poorest has become, if anything, more dire. Since 1975, the rising tide has been lifting a few boats but has been drowning the rest.
Actually, the whole idea of a free market is a myth. We have never seen one. The US during its greatest periods of economic prosperity was a protected economy favoring domestic producers and provided significant government support. The government has also made significant contributions to economic growth by funding scientific research or as a result of military projects, the space program and other programs. This was also true of other countries that have become economic powerhouses such as Japan, Korea and Taiwan. And if you think about it, there’s a broad inconsistency here as well: most advocates of free markets, Donald Trump being an example, are very much against free movement of labor – otherwise known as migration.
Unless, of course, you need that illegal immigrant to increase your profits in your hotel.. 😉
There’s alot more good stuff here: