"Market Fundamentalism is what prevents us from having universal health care, mass transit, affordable housing, trains that cross the nation, subsidized care for the young and elderly, and government efforts to reduce carbon emissions. The list, of course, is endless."

Sure is. I often find myself shaking my head in disbelief at the arguments put forward, even by the progressive contributors posting on Alternet.

One that never ceases to amaze me is the arguments against paying waiters proper wages. So you are left with customers who may or may not bother calculating and leaving the tip, and workers who may or may not be paid for their labour. But can't pay a wage and add it to the cost of the meal, because that would . . . would what? Now I know, breach market fundamentalism.

Well, living in a country where we have universal health care, mass transit, affordable housing, trains that cross the nation, subsidized care for the young, elderly, disabled, unemployed and those who care for the young, elderly and disabled, fair indexed minimum wages, gun control (note – NOT gun prohibition), government intervention in social programs (slip slop slap, buckle up, wear condoms etc), I can assure you that we still have a viable, flourishing, free market economy and the sky hasn’t fallen in.

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It gets right to the point about "free" market dogma that does more to restrict freedom than anything else. Comparing it with an irrational religion is spot on.

I have a few comments, of course...

The public hasn't been "bullied'. They have to take responsibility for buying this nonsense.

There's no way around the fact that the government is in many ways incompetent and inefficient, due to the realities of human nature. But practical, economic, moral, and statistical realities say that certain things like health care, disaster relief, etc. require collective answers due to the high cost, randomness, and no regard for the ability to pay.

Other countries seem to accept these realities, yet are key players in the free market...and are even passing us up.

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Thanks, Ruth, for the article. There is a bubbling groundswell to reclaim what is ours, outside of the market. Air, water, the internet, music, culture, even seeds. Common assets are not the province of private markets.

Check out www.onthecommons.org.
And check out my blog, where I write about the movie we are making on the subject. It's going to be a wild romp featuring DJ Spooky on a quest to find his missing music samples (the victim of over-agressive copyright enforcement), and The Commons.

My blog: http://blog.myspace.com/iblich.

Peace,

Brad

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is what fuels most economies around the world. making money is the incentive for most people to do things. Finding a way to make absurd profits on peaceful activities instead of weapons programs must be found. making absurd profits on sustainable/renewable energy must be found instead of the billions made in oil transactions. and so on...
find a way to do that, including gov't subsidies, and those things will become a reality. very tough to turn around that 800 pound gorilla called the 'free market'. co-opting it for social/environmental causes would be easier. as long as people could make a buck doing it.

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I have always suspected that the Bush Administration may have PURPOSELY allowed the debacle in New Orleans as an example of Government Ineffictiveness and Incompetance .

We all see how well the "magical" Marketplace worked in Medicare Part D and the rape of California during the so called Energy crisis ,which was of course largely percipitated by Enron Energy Traders who laughed about screwing Ol grandma . We also have the wonderful exhibit of fraud , waste and abuse by the Marketpalce in the rebuilding of iraq

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Finally an Alternet article that goes to the root of the major problems facing this nation and its society. More, I want to see more. Articles that analyze the imigration debate, global warming, the war in Iraq, healthcare crisis,our corrupt poltical system, all based on a critique of the way a market fundamentalist outlook drives them all. Keep it up!

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Ben Stein is usually one of those market fundamentalists that believe in the magical invisible hand of capitalism. His NYT column just a few days ago admitted that the way things are going, we'll birth a revolution or an outright aristocracy (rough quote). He alluded to the problems with the government (and perhaps a jab at Bush acting above the law). Given his typical columns, I'm thinking people are coming around.

The problem I think came along with Milton Friedman, because it seems to have spawned too many 'armchair economists' who have the impression that economics is some sort of natural law, which of course, it isn't. The free market idealists tend to start with unrealistic assumptions about utility and that humans behave rationally, which gives neat results but in the end starts on bad assumptions.

I also think that economic history is taught poorly, even in university. Marx (and Adam Smith for that matter) has been disregarded when he (they) had valuable input into class relations and the political implications of capitalism. And it's times like these that people tend to look back at Marx and realize that value. As Ben Stein observes the real results, income disparities, power grabs by corporations, private sector corruption, even the free market purists start to feel cheated by the supposed merits of their system.

First, it's easy to note ideas like public goods and externalities as economic arguments to justify government involvement, even among the purists.

Second, it's easy to note that private sector corruption is just as likely as or more likely than public corruption, except that private corruption these days mean additional economic wastes like obscene profits and irrationally high executive pay.

Third, with some things, the idea of markets can be useful. I'd like to see minimum wage raised even more and then pegged to inflation, so that minimum wages increase constantly and never go down in real value. Classical market theory will tell you that after an initial shock (unemployment) markets will adjust and do their magical work. And in this case, it means workers can't be cheated with falling real wages anymore.

And last, people need to realize that privatization puts us on the path to 'one dollar, one vote'. Public institutions are controlled by the people, private institutions are controlled by shareholders. This is especially important in the case of the privatization of our military. If it continues, kiss the peace movement goodbye, because you can't stop a military that you don't control. Eisenhower told us to fear the military/industrial complex for a reason. Blackwater, private Halliburton prisons, etc. don't answer to us.

- Two cents (all i got) from an economics student

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a couple of years ago after the fall of the communisme in Holland the government changed many things from state owned into private corporations i.e. postal service, telefoon, health care.
They said competition will make the prices lower.
The prices however rose and the mangers got huge salaries.
So I think some things must be controlled by the goverment and other things i. e. production must be ruled by the market.
Our minimum wages are $ 12.
Health care is for everybody, but we also have many millionaires.
But now we face the problem that some people receive for staying at home $10, but refuse to work for $ 2, extra.
Look at Sweden , Canada, Australia, China.
We are in the world to be part of a community in stead of grabbing money.

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Personally, I can think of many things an open marketplace can do that government cannot do. However, when the United States has trillions of dollars tied up in large companies as part of retirement savings, with future retirees putting close to $14 billion a year into long-term mutual funds alone, it is very hard for entrepreneurs to acquire start-up capital. If we want to have those creative ideas developed and tested, the nation must make it easier for new businesses to develop and to launch their products or services.

I also believe in government providing large-scale services, such as Social Security and universal health care. Yet, I do not want government to manage every part of my life or control which businesses are allowed to open in which neighborhoods, with some possible large-scale exceptions.

Market fundamentalism is not inherently evil. Allowing Microsoft to grow so large that the premier of China visits Washington state before Washington, DC, is very problematic.

For me, the first thing we need to do is start with tax increases. I believe it is a legitimate government policy and a policy that is in the best interest of the nation to discourage people from making huge sums of money. The argument that we need wealthy entrepreneurs and benefactors can be met with the argument that we are trying to build smaller power plants, less sprawling communities, and local produce markets so why do we need a company that can build a mega-mall?

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I was watching the first two episodes of the PBS series The Supreme Court last night and was reminded of how long and how often our courts have stood against working people , the right to organize, consumer protection, etc. For most of it's history, the Supreme Court has been the lackey and the enforcer of a system of, by, and for the wealthy. Without these numbskulls and their lifetime appointments the progressive movement would have moved much farther and much faster in this country.

In context, Bush v Gore was not an aberration- it was just more of the same.

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An important documentary concerning the rise of market fundamentalism is a BBC piece titled "The Century of the Self," produced by Adam Curtis

From the BBC's webpage for the film: "To many in both politics and business, the triumph of the self is the ultimate expression of democracy, where power has finally moved to the people. Certainly the people may feel they are in charge, but are they really? The Century of the Self tells the untold and sometimes controversial story of the growth of the mass-consumer society in Britain and the United States. How was the all-consuming self created, by whom, and in whose interests?"

The problem is that the film is very hard to find, so much so many have simply downloaded it. If you choose the latter the film can be downloaded from the Internet Archive (archive.org), or it is also available on BitTorrent.

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I am NOT a person who argues that the free market will address effectively every issue, especially in the short run. And I am a retired 30+ year Business Professor. (GRIN)

BUT... in the free market system, ineffectiveness and ineffeciency are punished by losses and eventually the business collapses. IF there is a true market need, other businesses more effective and efficient will find ways to satisfy that need and at a profit. I will admit there is often a problem gaining collective private sector cooperation necessary for dealing with very large social issues. BUT, in many cases govt regulations prevent this cooperation. A good example is in collective R+D. Few government incentives have been created to gain this cooperation. An example of effectivess in the history of the development of the internet. Started by NSF money and rapidly invested private monies. A private-public sector cooperative huge success.

Now... what measures are used and ENFORCED in the public sector to assure effectiveness and effiency? When an public sector program is NOT working, how do we correct it or even eliminate it. Fact of life.... govt programs once started no matter how ineffective/ineffecient have a life of their own. How can we get better REAL oversighgt of public works by Congress?

Until these types of questions/issues are addressed seriously and measurable means developed, the public sector will remain a very overall ineffecient/ineffective means of solving problems.

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its funny how we keep pointing this out as a society but there has been such great resistance by corporate capitalism with their control of conservative think thanks, the media and university research.

In the mid 1990s, Herman Daly, a former World Bank economist, co-authored a wonderful book which debunked the virtues of the free market. In the book, For the Common Good he points out how classical economic precepts (mostly cultural constructs anyway) don't apply in globalized world with highly fluid capital divorced from nation-states. (Something never envisoned by David Ricado).

Here's a link to a well-written review of Daly's book is "For the Common Good".

http://www.scottlondon.com/reviews/daly.html

The book is a demanding read but well worth it. I always knew economics was nonsense---lol, I have a undergrad in economics and an MBA---but Daly provides the intellectual framework and powerful confirmation to commonsense intuition about the many shortcomings of corporate capitalism.

Another very funny and much shorter take on this is The Market as God" " by Harvey Cox, originally in the Atlantic. linked http://csunx4.bsc.edu/bmyers/Market%20As%20God.doc.

I haven't read the Atlantic much recently and their last issue was scarily skewed to the right. Anyone else notice that?

Anyways, good article, keep them coming. Maybe provide links to other research in the same area. Ed Broadbent, Canadian politician, has a great quote "we want a market economy, not a market society".

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I think everyone seems to be forgetting something: Market Fundamentalism has accomplished virtually everything it set out to accomplish FOR the top 1-2%. Ultra-wealthy Americans, Europeans, Canadians, Australians, and now, Chinese, Koreans, Indians, Russians and Brazilians are ruthlessly exploiting markets by adhering to a combination of the Friedmans' neoliberal trade doctrines.

The lower classes in most of the aforementioned countries are slaving away for a mere fraction of appropriate wages given labor outputs vs. returns. American corporations are free to scour the planet in search of the next most exploitable workforce in which to manufacture anything from Pooh-Bear T-shirts to hi-tech microprocessors for greedy, frugal consumers in the US and France.

Before we all get up on our high horses and start excoriating market fundamentalism, let's remember that WE ARE THE MARKET. Every time you rushed out and dropped $500 for Christmas presents, you helped widen and legitimize the market. Remember how you waited for the price of that plasma to hit rock bottom before buying? That was market fundamentalism, and on that day, you loved it because it provided exactly what it promised and at the lowest possible price. Universal healthcare be damned! So until we start eschewing the profligate nature of capitalism and learn to temper it with some geunuine forms of humanitarianism, we can just expect more of the same. My point is this: we cannot continue to simultaneously exploit the highly exploitative capitalist system ourselves and expect it to meet the needs of everyone.

"Market Fundamentalism is what prevents us from having universal health care, mass transit, affordable housing, trains that cross the nation, subsidized care for the young and elderly, and government efforts to reduce carbon emissions. The list, of course, is endless."

Market fundamentalism never had any pretensions of doing those things. They are generally very costly and offer little in return in the most narrow, capitalistic sense. It's time to start separating the seemingly philanthropic theories of Harvard economists from the cold reality of real world capitalism.

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When you're talking about Market Fundamentalism, you're talking about capitalism.

Capitalism requires constant unsustainable growth. It's motto is 'creative destruction' which means absolutely incredible waste in developing products and a constant cycle of boom and financial bust. Capitalism naturally destroys consumer demand by constantly finding ways to reduce the pay of everyone except the executive elite, whether by moving work offshore or busting unions. It is a rare executive that understood the wisdom of Henry Ford who knew that workers had to be paid enough to buy his products to have a self-sustaining consumer-based system.

The 'haves' have always believed in Social Darwinism, usually supplemented by scripture that the rich are rich because God favors them and the poor are poor because God doesn't like them. It's a system based on greed, which if unrestrained ends-up with the sinful inequalities in wealth and income in the US where the gap is constantly widening.

As we see today, capitalists hate competition. They like monopolies with lots of corporate welfare. The joining of the state and the corporate elite is what fascism is all about. Capitalism is incompatible with a republican government and democracy. The role of the government is not to protect the 'common good', but to suppress those who are not in Bush's self-described base of the extremely rich and the filthy rich.

The Great Depression is the endpoint of capitalism. The US only climbed out because of war. War is crown jewel of capitalism. It creates it's own demand to replace the war machines that are rapidly destroyed or damaged and the munitions expended. Scientists are brought together to create more destructive war machines and munitions with a bottomless budget. Profit margins explode because the war profiteers deal with that cesspool of waste, fraud and abuse, the War Dept., and now the Fatherland Security Dept., which on a proportional basis may well be a bigger sinkhole than the War Dept. and, of course, because of the exigencies of war.

Everyone takes as the basis of reference those few decades after WWII when America tried to live up to it's promise. The ruling elite were deathly afraid that the US would once again fall into the Great Depression after WWII. Further, there were millions of men returning who had experienced the barbaric brutality of war and had been trained and become serial mass murderers. In addition, the world was mostly communist, socialist or anti-colonial which claimed to have political economies that were worker-friendly and a Soviet propaganda machine that exposed the racism and suppression of the lower classes in America. So the capitalist elite bit the bullet for a few decades and shared the profits more fairly and acquiesced to government programs that favored Americans other than themselves. Thus, the American Dream was born. But it couldn't last on a system based on greed, so beginning with Raygun, government was returned as a tool for the rich.

Today reminds me of the panic that ensued among the rich when Manifest Destiny ended in the 1890's; the Native Americans had been ethnically cleansed and all their land and resources had been stolen and the US was in a prolonged depression. The solution they came up with was war and colonies. Claiming we were going to help the colonized liberate themselves, we started the Spanish-American war with Spain at a time when the Cuban and Filipino freedom fighters were beating the Spanish. First we got rid of the Spanish, then we got rid of the freedom fighters in a lengthy and brutal counter-insurgency campaign.

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Dean Baker offers some thoughts over in PEEK.

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When I am meeting with elected officials (who are mostly Republican in my area), I try to frame the issue as one of competition.

I find the “anything government can do business can do better” mentality is to ingrained in most peoples minds to effectively challenge directly.

However I will argue that competition is good for business. Though you can’t have competition with out rules and someone to enforce those rules, without rules and a ref football is just a brawl. Baseball becomes a bunch of guys with bats. Hockey is just a brawl on ice; alright a brawl on ice without the penalty box cause hey isn’t that why we watch it.

Regardless I think that reasonable people can agree that government can and should regulate business, the only debate is to what extent.

Someone who argues that business shouldn’t be regulated at all isn’t being reasonable, or believes that they are in a position to dominate a “free-for-all”. Of course we all know that when a company dominates a market the result is monopoly and that is the death of competition. I believe that we should take this lesson to heart and view anyone who claims otherwise with skepticism.

I find that if you start off an appeal for Republican support for regulation this way you can quickly prevent the “let the market solve it” knee-jerk response that they love to use to dismiss such suggestions.

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I don't suppose I'm the only 50-ish guy that has images of many entrepreneurs and industrialists of the past as caring, "father" figures.

Whereas this seems unlikely in reality, the images persist in contrast to my current ones.

Has capitalism changed fundamentally? Or have more recent business formulae made opportunism more attractive than achievement?

Science-fiction of the "good old days" frequently envisioned domination of humanity by industry. Apparently the machines are actually human, too.

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Boycott!

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I mentioned it in the Chris Hedges article on despair in alienated America, but Wendy Brown is right up this alley. Anyone concerned with the rhetoric of market-fundamentalism ought to get into her. Of course, they out to get into Marx and Adorno and Debord and Zizek... and all these other people for the last 150+ years have pointed out the insanity and danger of capitalism.

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The market, the turning of everything in human life into a "shopping experience," IS the problem.

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The central premise of the article is that "Market Fundamentalism" is just that--fundamentalism, faith devoid of reason. Yet over and over it cites examples of government failures and blames them on the market: mercenary contractors behaving like barbarians in Iraq (blame the military industrial complex, not the market), rising health care costs (ridiculous regulations by the FDA), the katrina relief effort (the whole flood was the failure of a government agency in the first place). Maybe, when examining an ideology for the quality of being devoid of reason, the author should be a little more critical of his/her own arguments. The very fact that someone as young as I can observe such obvious contradictions in the arguments of someone who is paid to think should give this article's readers much, much contemplation time.

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Big capital unrestrained, like big government unrestrained is not to be trusted and becomes ruinous to the societies that create them. As long as humans have the potential to serve greed by shortcutting regulatory processes through graft, influence peddling or legal obstruction, there must be a firewall beyond the market's self regulation for the protection of the general welfare. That firewall is our central government and the various levels of local government.

The free market does regulate itself to some extent, just not in a fashion or speed beneficial to the economic health or well being of the economy or the nation. Adam Smith and others never imagined companies like ExxonMobil that have revenues greater than many developed nations and profits (2006 $39.5 Billion) that dwarf the tax revenues of many more. That kind of economic power buys influence, locally and internationally, that only a wary and vigilant central government has the resources and power to resist- and then only with careful oversight. The $200 million ExxonMobil has spent on lobbying and campaign contributions in recent years amounts to less than 2 days profit for the corporation.

All academic arguments aside, the Constitution clearly charges the US Government with the role of acting to promote commerce (read healthy competition), the general welfare of the nation (worker rights and protection, consumer protection, environmental protection, economic security & stability of the nation) and to secure the blessings of liberty (the rights common to all people regardless of station) which TRUMP all claims of property rights and private ownership of any real property or resources. Without careful regulation and oversight to protect the commons and the rights of citizens in their various roles (owner, renter, employer, employee, citizen, seller, consumer, injured party) the basic freedoms of each person and that of the nation as a whole are materially and measurably diminished in the face of such overwhelming influence, resources, and economic power.

With apologies to the late Dr Freidman, there are legitimate interests in government regulation of markets, contracts, property rights, employment, resolution of disputes, access to credit and redress of injury that require robust regulation. This regulation need not be adversarial, but should also not be incestuous. Lax oversight, neglect of duty and deregulation have landed the United States in just such an economic and political quandary.

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I get so tired of hearing people quote Adam Smith, Milton Friedman et al about the marvelous efficiency of the free-market system. The collapse of the Soviet Union has been offered as proof of the supremacy of free-market economics. Yes, we came out on top in that contest, but look what we are comparing ourselves to. The Soviet model was a horrible example of a planned economy. Even so, the outcome of that contest was by no means pre-ordained. The doctrine of mutually assured destruction ensured that the contest would go on until one side or the other collapsed from within. It could easily have been us instead of them.

Let’s take a look at where the free-market theory will lead us if we follow it to its natural conclusion. We can begin with ending all government social programs. Why waste government money on these? Let private funding support any form of welfare. Now, let government stop offering any tax incentives which might affect how people choose to spend their money. The government can stop wasting money on regulating the medical and pharmaceutical industries. Let the free market take care of that. If too many people die at the hands of a particular doctor, that will erode his or her customer base. Next, we can stop regulating the insurance industry. If insurance companies get a reputation for not paying off their claims, people will stop buying insurance from them. Now we can de-regulate the advertising business. Businesses can claim their products do anything they want. If they fail to live up to their promises, let the market punish them by eroding their customer base. We can at the same time de-regulate product safety laws under the same theory. Next, we de-regulate traffic control. The government is no longer in the business of refereeing traffic accidents. Nor are they in the business of issuing drivers licenses or traffic tickets. Anybody who can afford a car can drive it any way they please. If they drive recklessly, sooner or later they will probably kill themselves. While we are at it, we can privatize law enforcement. If the police department devolves into gangs of hired thugs, they are just responding to market forces. The government has no business telling private citizens what kind of recreational drugs they may or may not take. Let the market decide that. We can also privatize the court system. People can buy justice if they can afford it. If they can’t afford it, they don’t deserve it anyway. If someone thinks a rapist or child killer should be kept off the street, let them pay for their incarceration. We can open the doors to all of the prisons unless we can find private citizens willing to pay for their maintenance. Let’s not forget to end any government involvement in education. If people can’t afford an education, they don’t deserve that either. Nor should the government get involved in domestic disputes. If private citizens choose to kill each other, that’s their choice. It’s a free country, after all.

Do you see where this is all going? It’s called anarchy. It doesn’t work. Am I taking the free market model to absurd lengths? Milton Friedman didn’t think the government should regulate recreational drugs or the medical, pharmaceutical, or insurance industries.

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