Originally posted by normbenignIs the market free or not? Your post suggests that we have an unfree market and that this leads to lower prices and better quality.
They argue first that the market isn't truly free. Is that disputable?
"Without regulation, some of the consequences are undesirable from the perspective of a capitalist. So the question becomes what types of regulation have what types of impact. Your assertion that banking was "one of the more controlled parts of the American economy" is so laughabl ...[text shortened]... ? We no longer get to buy Studebakers or Hudsons. They failed competitively, and fairly.
Originally posted by normbenignThere is no room in economic management for ill considered, ideological arguments that are impervious to evidence.
They argue first that the market isn't truly free. Is that disputable?
"Without regulation, some of the consequences are undesirable from the perspective of a capitalist. So the question becomes what types of regulation have what types of impact. Your assertion that banking was "one of the more controlled parts of the American economy" is so laughabl ...[text shortened]... ? We no longer get to buy Studebakers or Hudsons. They failed competitively, and fairly.
With lax regulation, banking and the finance industries have caused the worst economic collapse imaginable and you still argue that lack of regulation leads to better competition. Your logic dictates that we must somehow let the banks free to do it all again. How many times? How many and how big do you need their failures before you reconsider?
Competition is not the product of completely free markets. Monopolies destroy competition. In principle, innovative new firms should always eat at the margins of their big rivals, but in reality they are eaten up by them, swallowed and fade into memory. The point of the exceptions is that they are the exceptions. Yes, new big monopoly firms will continue to enter the markets and destroy wealth in the process. It is a well trodden path and our governments leave us defenceless against the process.
By all means, consumers relish the cheap books, music and film DVDs brought to them by the huge new providers who can offer savings that other distributors cannot match - because they do not pay the taxes or the wages paid by their rivals. The big retailers who do not pay the local taxes or even the rents to make town centres viable will continue to attract consumers by the car load. But collectively we are getting worse off and you are too smug in your inherited comforts to understand that they are slowly but surely sinking into the sands.
Originally posted by finnegan"Competition is not the product of completely free markets. Monopolies destroy competition"
There is no room in economic management for ill considered, ideological arguments that are impervious to evidence.
With lax regulation, banking and the finance industries have caused the worst economic collapse imaginable and you still argue that lack of regulation leads to better competition. Your logic dictates that we must somehow let the banks free ...[text shortened]... in your inherited comforts to understand that they are slowly but surely sinking into the sands.
How many small companies have been bailed out by our government? How many mega corporations?
I rest my case.
Originally posted by KazetNagorraYour statement is far more of a polemic than that of those free market thinking writers. It is simply your predisposition to another vision (set of premises) which makes their view overly simplified.
It's not so much wrong as it is childish. Viewing the world or the economy in such overly simplistic dichotomies is a form of intellectual masochism.
Capitalism predates free markets. Adam Smith in the 18th century historically reviewed hundreds of years of the use of capital, arguing that capital use was more effective in more free markets.
Free Markets make capitalism work better.
Originally posted by AThousandYoung"Your post suggests that we have an unfree market and that this leads to lower prices and better quality."
Is the market free or not? Your post suggests that we have an unfree market and that this leads to lower prices and better quality.
I don't know where you get that, but to clear it up, we have relatively free markets. Where there is the most freedom, lower prices and higher quality result. Where there are restrictions, the opposite happens.
Originally posted by normbenignTo what "vision" do I have a "predisposition"?
Your statement is far more of a polemic than that of those free market thinking writers. It is simply your predisposition to another vision (set of premises) which makes their view overly simplified.
Capitalism predates free markets. Adam Smith in the 18th century historically reviewed hundreds of years of the use of capital, arguing that capital use was more effective in more free markets.
Free Markets make capitalism work better.
Originally posted by normbenignHow do you explain the cases, for example, of health care markets that have more government control, higher quality, and lower prices than the US health care market?
"Your post suggests that we have an unfree market and that this leads to lower prices and better quality."
I don't know where you get that, but to clear it up, we have relatively free markets. Where there is the most freedom, lower prices and higher quality result. Where there are restrictions, the opposite happens.
Originally posted by KazetNagorraSocial and government policies often take decades, even generations to show their true colors. That and the fact that the US health care market is far from being a free marketplace. Since the '60s, Medicare, and Medicaid are 3rd party payors which amount to a very large percentage of care and distort a free market system. Also, the high level of employer paid "gold plated" insurance takes another large chunk out of the competitive marketplace.
How do you explain the cases, for example, of health care markets that have more government control, higher quality, and lower prices than the US health care market?
My explanation would be that all commodity prices are subject to supply and demand. Anywhere you go in the world, there is less health care than there is need. Some places, more so than others. When scarcity exists some method of rationing the scarce commodity will be used. Markets tend to use incentives, to get more people into providing the scarce services. The opposite approach is to use force, dictating who gets what, and who provides it.
I tend to trust incentives more than force. While compulsion seems to be currently working in some places, there is no explanation of how it ultimately creates additional supplies to reduce scarcity.
Originally posted by normbenignSo your "explanation" amounts to looking in your crystal ball and baselessly claiming that eventually the faeces will hit the air circulation system?
Social and government policies often take decades, even generations to show their true colors. That and the fact that the US health care market is far from being a free marketplace. Since the '60s, Medicare, and Medicaid are 3rd party payors which amount to a very large percentage of care and distort a free market system. Also, the high level of employ ...[text shortened]... there is no explanation of how it ultimately creates additional supplies to reduce scarcity.
Originally posted by normbenignI do believe in scientific solutions (if applicable). I'm not sure what you mean by "dialectic planning". In any case I don't reject the free markets, they are a very useful tool in many situations. For example, a government-planned scheme would never be able to produce TV's as efficiently as the free markets can do it.
Most modern academics tend to believe in scientific solutions, and dialectic planning. I think you fall in with that group, which logically rejects Adam Smith's invisible hand.
Originally posted by normbenignWhereas nasty old governments try to ration it based on relative need, i.e rather than the rich man getting his toenails cut, the poor man gets a new kidney.
Social and government policies often take decades, even generations to show their true colors. That and the fact that the US health care market is far from being a free marketplace. Since the '60s, Medicare, and Medicaid are 3rd party payors which amount to a very large percentage of care and distort a free market system. Also, the high level of employ ...[text shortened]... there is no explanation of how it ultimately creates additional supplies to reduce scarcity.
Having said that I have no problem with the rich man utilizing a subordinate private healthcare system to get his toenails cut at his convenience.
In your view it appears that we have to slavishly follow Adam Smiths doctrine of complete Laissez-Faire, or face some competition stifling, overbearing socialist dystopia. Usually the best and most common outcome is a fusing together of the two extremes; thus obtaining an optimum of freedom, social coheseion and responsibility.