Comments on: Free markets and free societies may not go hand in hand http://welkerswikinomics.com/blog/2008/08/29/does-a-free-market-lead-to-a-free-society-maybe-not/ for students and teachers of Economics Wed, 08 Feb 2012 23:39:55 +0000 hourly 1 http://wordpress.org/?v=3.3.1 By: dennymack http://welkerswikinomics.com/blog/2008/08/29/does-a-free-market-lead-to-a-free-society-maybe-not/comment-page-1/#comment-15911 dennymack Fri, 09 Sep 2011 00:47:21 +0000 http://welkerswikinomics.com/blog/2007/08/27/does-a-free-market-lead-to-a-free-society-maybe-not/#comment-15911 Free markets do not guarantee a free society. Nothing does. Free societies are history's spring snow flakes: rare and ephemeral. Free societies need some type of devolution of power away from humanity's dominant forms of government, which have been dictatorships and monarchies up until the last generation. They need the a rule of law that is not capricious and protects property rights, from both bandits and bureaucrats. It only counts if it is relatively free from corruption. If the government has enough power and scope to pick winners and losers in the economy, you do not have a free economy. This may be an aspect of corporatocracy that Chomsky was unwilling to address. The notion that one empowers a government to rule the economy in the expectation that all of that power will be wielded by the weakest strikes me as naive. The biggest players in the economy are never free-marketers. They want the reins of the economy gathered in the hand of government, because they know they will then control that hand. How much political freedom does a society need for a thriving free economy? I think that will depend on the history of the society. Deng Xiaoping came after Mao, so he could dole out small drips of freedom and it would seem to the populace like a great improvement. Watch China over the next 50 years, and we may see that people who grew up as semi-free autonomous actors, who make their own way in the world, demand more say in the governance of society. The "freedom" of the Chinese economy may also be overstated at times, as is their success. They are still digging out from the 20th Century, and a lot of problems have been deferred. Russia is not a free society. They only experienced freedom while their country was falling down the well. As soon as the tumult stopped, they got oligarchs and Putin. They are a bizarre example of psuedo-capitalism as well: No one owned any property or wealth, and then they held an auction for all of the capital in the country. (I simplify.) Who was bidding, and with what? De-collectivizing has been less lethal than collectivizing, but it is still a mess. Economic Strength at the cost of individual freedom: Not in the long term. Perhaps a command that everyone fill sandbags to keep the town from flooding might work, but if we centrally allocated peoples labor it would not be as efficient as free labor. Free people may or may not work harder than un-free people, but they sure work smarter. Mao had an idea to launch China forward, so he took over allocation of labor and goods. I believe it was one of the largest famines in human history. And it is not just Mao. Rarely have unfree people out-produced free people. Even China had to semi-free its people in order to see gains in productivity. Free markets do not guarantee a free society. Nothing does. Free societies are history's spring snow flakes: rare and ephemeral.

Free societies need some type of devolution of power away from humanity's dominant forms of government, which have been dictatorships and monarchies up until the last generation.

They need the a rule of law that is not capricious and protects property rights, from both bandits and bureaucrats. It only counts if it is relatively free from corruption.

If the government has enough power and scope to pick winners and losers in the economy, you do not have a free economy. This may be an aspect of corporatocracy that Chomsky was unwilling to address. The notion that one empowers a government to rule the economy in the expectation that all of that power will be wielded by the weakest strikes me as naive. The biggest players in the economy are never free-marketers. They want the reins of the economy gathered in the hand of government, because they know they will then control that hand.

How much political freedom does a society need for a thriving free economy? I think that will depend on the history of the society. Deng Xiaoping came after Mao, so he could dole out small drips of freedom and it would seem to the populace like a great improvement. Watch China over the next 50 years, and we may see that people who grew up as semi-free autonomous actors, who make their own way in the world, demand more say in the governance of society. The "freedom" of the Chinese economy may also be overstated at times, as is their success. They are still digging out from the 20th Century, and a lot of problems have been deferred.

Russia is not a free society. They only experienced freedom while their country was falling down the well. As soon as the tumult stopped, they got oligarchs and Putin. They are a bizarre example of psuedo-capitalism as well: No one owned any property or wealth, and then they held an auction for all of the capital in the country. (I simplify.) Who was bidding, and with what? De-collectivizing has been less lethal than collectivizing, but it is still a mess.

Economic Strength at the cost of individual freedom: Not in the long term. Perhaps a command that everyone fill sandbags to keep the town from flooding might work, but if we centrally allocated peoples labor it would not be as efficient as free labor. Free people may or may not work harder than un-free people, but they sure work smarter.

Mao had an idea to launch China forward, so he took over allocation of labor and goods. I believe it was one of the largest famines in human history. And it is not just Mao. Rarely have unfree people out-produced free people. Even China had to semi-free its people in order to see gains in productivity.

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]]> By: Samantha R. http://welkerswikinomics.com/blog/2008/08/29/does-a-free-market-lead-to-a-free-society-maybe-not/comment-page-1/#comment-12840 Samantha R. Tue, 14 Dec 2010 20:08:12 +0000 http://welkerswikinomics.com/blog/2007/08/27/does-a-free-market-lead-to-a-free-society-maybe-not/#comment-12840 1. Although it is considered likely that a free market will lead to a free political society, this is clearly not true in every case. As seen in the article, China has had free market policies for quite some time and has still not adopted political freedom. 2. Political freedom is not required to have a successful market economy, as illustrated by the country of China. As Jason said, China has a free market economy that is "seemingly thriving in a society where political and social freedoms are severely limited by the communist dictatorship". 3. Corporatocracy is when the freedom of the individuals of a country is ignored and focus is instead given to the corporation "to lobby and thus influence government into creating favorable environments for investment and growth, often times at the expense of society’s health and the best interests of the public as a whole." I do not believe that Corporatocracy has taken over yet, because I am still under the impression that the United States government is focusing on creating policies that will improve our society's well being as a whole. However, that could also be naivety on my part. 4. If a country were to fully adopt the policies of "Corporatocracy" and focus completely on raising output or economic growth without considering the current needs/wants of its people in the short term, then the country would be growing stronger economically at the expense of its citizens. For example, if the government were to increase taxes at the end of this year, it would bring in a lot of money for the government in the long run, but it would be very detrimental to U.S. citizens in the short run. 1. Although it is considered likely that a free market will lead to a free political society, this is clearly not true in every case. As seen in the article, China has had free market policies for quite some time and has still not adopted political freedom.

2. Political freedom is not required to have a successful market economy, as illustrated by the country of China. As Jason said, China has a free market economy that is "seemingly thriving in a society where political and social freedoms are severely limited by the communist dictatorship".

3. Corporatocracy is when the freedom of the individuals of a country is ignored and focus is instead given to the corporation "to lobby and thus influence government into creating favorable environments for investment and growth, often times at the expense of society’s health and the best interests of the public as a whole." I do not believe that Corporatocracy has taken over yet, because I am still under the impression that the United States government is focusing on creating policies that will improve our society's well being as a whole. However, that could also be naivety on my part.

4. If a country were to fully adopt the policies of "Corporatocracy" and focus completely on raising output or economic growth without considering the current needs/wants of its people in the short term, then the country would be growing stronger economically at the expense of its citizens. For example, if the government were to increase taxes at the end of this year, it would bring in a lot of money for the government in the long run, but it would be very detrimental to U.S. citizens in the short run.

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]]> By: Aly W. http://welkerswikinomics.com/blog/2008/08/29/does-a-free-market-lead-to-a-free-society-maybe-not/comment-page-1/#comment-12828 Aly W. Tue, 14 Dec 2010 11:07:15 +0000 http://welkerswikinomics.com/blog/2007/08/27/does-a-free-market-lead-to-a-free-society-maybe-not/#comment-12828 1. No, free markets do not lead to free societies. 2. No, political freedom is not required to have a successful market economy. 3. I do not think that corporatocracy has surpassed democracy, but I definitely believe that there has been an increase in corporatocracy. 1. No, free markets do not lead to free societies.

2. No, political freedom is not required to have a successful market economy.

3. I do not think that corporatocracy has surpassed democracy, but I definitely believe that there has been an increase in corporatocracy.

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]]> By: Katrina S. http://welkerswikinomics.com/blog/2008/08/29/does-a-free-market-lead-to-a-free-society-maybe-not/comment-page-1/#comment-12821 Katrina S. Tue, 14 Dec 2010 09:12:28 +0000 http://welkerswikinomics.com/blog/2007/08/27/does-a-free-market-lead-to-a-free-society-maybe-not/#comment-12821 1. After reading this post it is clear that just because a country has a free market, it does not have to have a free society. Such is the situation with China, a real oximoron. Becoming the third most powerful capitalist country in the world while promoting very little social freedom does not go along with the philosophy of Milton Friedman. Such a glaringly unexpected example proves that strong theories have the capacity to be proven wrong. 2. Political freedom is not a prerequisite for a successful market economy, for as the blog said, free market economies sway the government's actions in favor of corporations and not the people. Political freedom, in this case, would take a back seat for further growth of the market economy. 3. In general, I don't believe corporatocracy has taken over the developed and wealthier countries of the world just yet. However, the cuts in government funding for social services, and such, are worrisome. If the priorities of the government do not start to focus more on the people soon, corporatocracy could be in our future. 4. Economic strength often comes at the expense of an individual, such is the case with creative destruction, trade-offs, and the job one might lose due to off-shoring. 1. After reading this post it is clear that just because a country has a free market, it does not have to have a free society. Such is the situation with China, a real oximoron. Becoming the third most powerful capitalist country in the world while promoting very little social freedom does not go along with the philosophy of Milton Friedman. Such a glaringly unexpected example proves that strong theories have the capacity to be proven wrong.

2. Political freedom is not a prerequisite for a successful market economy, for as the blog said, free market economies sway the government's actions in favor of corporations and not the people. Political freedom, in this case, would take a back seat for further growth of the market economy.

3. In general, I don't believe corporatocracy has taken over the developed and wealthier countries of the world just yet. However, the cuts in government funding for social services, and such, are worrisome. If the priorities of the government do not start to focus more on the people soon, corporatocracy could be in our future.

4. Economic strength often comes at the expense of an individual, such is the case with creative destruction, trade-offs, and the job one might lose due to off-shoring.

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]]> By: Emily http://welkerswikinomics.com/blog/2008/08/29/does-a-free-market-lead-to-a-free-society-maybe-not/comment-page-1/#comment-7831 Emily Tue, 07 Apr 2009 00:25:07 +0000 http://welkerswikinomics.com/blog/2007/08/27/does-a-free-market-lead-to-a-free-society-maybe-not/#comment-7831 Great post, thanks for the info Great post, thanks for the info

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]]> By: Jason Welker http://welkerswikinomics.com/blog/2008/08/29/does-a-free-market-lead-to-a-free-society-maybe-not/comment-page-1/#comment-7447 Jason Welker Mon, 02 Mar 2009 16:31:08 +0000 http://welkerswikinomics.com/blog/2007/08/27/does-a-free-market-lead-to-a-free-society-maybe-not/#comment-7447 Hello Andy. To subscribe to the RSS click on the round logo in the upper right hand corner of the blog, that will take you to the feed page. Or just put the following into your browser: <a href="http://welkerswikinomics.com/blog/feed/" rel="nofollow">http://welkerswikinomics.com/blog/feed/</a> Hello Andy. To subscribe to the RSS click on the round logo in the upper right hand corner of the blog, that will take you to the feed page. Or just put the following into your browser: http://welkerswikinomics.com/blog/feed/

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]]> By: Andy L http://welkerswikinomics.com/blog/2008/08/29/does-a-free-market-lead-to-a-free-society-maybe-not/comment-page-1/#comment-7445 Andy L Mon, 02 Mar 2009 15:03:46 +0000 http://welkerswikinomics.com/blog/2007/08/27/does-a-free-market-lead-to-a-free-society-maybe-not/#comment-7445 Can you help me? I'm trying to subscribe to your RSS feed, but can't seem to figure it out. Did you have that option in your blog? Really like it, BTW. Can you help me? I'm trying to subscribe to your RSS feed, but can't seem to figure it out. Did you have that option in your blog? Really like it, BTW.

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]]> By: Justin C http://welkerswikinomics.com/blog/2008/08/29/does-a-free-market-lead-to-a-free-society-maybe-not/comment-page-1/#comment-5891 Justin C Thu, 25 Sep 2008 02:18:44 +0000 http://welkerswikinomics.com/blog/2007/08/27/does-a-free-market-lead-to-a-free-society-maybe-not/#comment-5891 A free market is successful because the “market” decides what needs to be produced and what is the surplus. Which still works quite well in a Communist type of economy, because the government is not telling people what do produce, they just approve/disapprove the documents. No countries uses a pure form of capitalism or a pure command economy. Most countries use a blend of economies. A market economy is dependent upon the freedom of the people, because with the freedom comes self interest and competition. However, in command systems, where there is no competition since the government owns everything, I think that the country can still succeed without political freedom. A free market is successful because the “market” decides what needs to be produced and what is the surplus. Which still works quite well in a Communist type of economy, because the government is not telling people what do produce, they just approve/disapprove the documents.

No countries uses a pure form of capitalism or a pure command economy. Most countries use a blend of economies.

A market economy is dependent upon the freedom of the people, because with the freedom comes self interest and competition. However, in command systems, where there is no competition since the government owns everything, I think that the country can still succeed without political freedom.

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]]> By: Rohan Rajiv http://welkerswikinomics.com/blog/2008/08/29/does-a-free-market-lead-to-a-free-society-maybe-not/comment-page-1/#comment-5690 Rohan Rajiv Thu, 11 Sep 2008 05:31:35 +0000 http://welkerswikinomics.com/blog/2007/08/27/does-a-free-market-lead-to-a-free-society-maybe-not/#comment-5690 To me free markets and free societies do not go hand in hand. I agree with Bastien. In general we all ultimately depend on the government,but not to a huge extent. This is why the USSR prospered. Their way of running the economy led to their own downfall. They controlled the economy is such a way that it would grow only up till a certain limit and had no other choice but to fall back down. The only reason China is growing fast is because they are finally opening up to the world. They realised the threat that communism would have a devastating affect. If there was a thing called a totally free economy then there would be havoc everywhere. Greed for more and more money will eventually cause a downfall. To me free markets and free societies do not go hand in hand. I agree with Bastien. In general we all ultimately depend on the government,but not to a huge extent. This is why the USSR prospered. Their way of running the economy led to their own downfall. They controlled the economy is such a way that it would grow only up till a certain limit and had no other choice but to fall back down. The only reason China is growing fast is because they are finally opening up to the world. They realised the threat that communism would have a devastating affect. If there was a thing called a totally free economy then there would be havoc everywhere. Greed for more and more money will eventually cause a downfall.

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]]> By: Bastien Vogt http://welkerswikinomics.com/blog/2008/08/29/does-a-free-market-lead-to-a-free-society-maybe-not/comment-page-1/#comment-5608 Bastien Vogt Thu, 04 Sep 2008 16:37:34 +0000 http://welkerswikinomics.com/blog/2007/08/27/does-a-free-market-lead-to-a-free-society-maybe-not/#comment-5608 I believe that a government totally controlling a market doesn't work out. The more political freedom the market has, the more the economy will prosper. Here is an example of what could happen to a communist nation, like China, if the government took total control of the Chinese market. Most of Chinas economic wealth is from their vast amount of exports. If the government had full control of the market, then labor wouldn’t be so cheap in China. This would cause many buyers to look to other nation like Taiwan who sell very cheap labor. I agree with Christian E. when he says it wouldn’t be very beneficial for China to not follow the basic concepts of a free market. I believe that a government totally controlling a market doesn't work out. The more political freedom the market has, the more the economy will prosper. Here is an example of what could happen to a communist nation, like China, if the government took total control of the Chinese market. Most of Chinas economic wealth is from their vast amount of exports. If the government had full control of the market, then labor wouldn’t be so cheap in China. This would cause many buyers to look to other nation like Taiwan who sell very cheap labor. I agree with Christian E. when he says it wouldn’t be very beneficial for China to not follow the basic concepts of a free market.

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]]> By: Marc Lemann http://welkerswikinomics.com/blog/2008/08/29/does-a-free-market-lead-to-a-free-society-maybe-not/comment-page-1/#comment-5606 Marc Lemann Thu, 04 Sep 2008 15:49:20 +0000 http://welkerswikinomics.com/blog/2007/08/27/does-a-free-market-lead-to-a-free-society-maybe-not/#comment-5606 I agree that democracies have become what Noam Chomsky called a corporatocracy. Both in developed nations and developing nations, the interests of the corporate world, that pumps a lot of money into the counties’ economy has become very influential in the priorities of the government. I disagree with Mr Reich from the article who states that “companies seeking an advantage over global competitors have invested increasing amounts of money in government lobbying, public relations and bribery.” Companies have not lobbied governments, but the governments have acted favorably to companies because they bring in a lot of money into the economy and that is why “the process of corporations writing their own rules” has happened and influenced the government. Companies have invested in promoting local events and giving money to social causes, this has made relations with the folk, which still has a say in the government, and their voice is still heard through the democratic process, and because their ideas have also started favoring the influence of corporations, the way governments work has changed. I agree that democracies have become what Noam Chomsky called a corporatocracy. Both in developed nations and developing nations, the interests of the corporate world, that pumps a lot of money into the counties’ economy has become very influential in the priorities of the government. I disagree with Mr Reich from the article who states that “companies seeking an advantage over global competitors have invested increasing amounts of money in government lobbying, public relations and bribery.” Companies have not lobbied governments, but the governments have acted favorably to companies because they bring in a lot of money into the economy and that is why “the process of corporations writing their own rules” has happened and influenced the government. Companies have invested in promoting local events and giving money to social causes, this has made relations with the folk, which still has a say in the government, and their voice is still heard through the democratic process, and because their ideas have also started favoring the influence of corporations, the way governments work has changed.

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]]> By: Daniel Drummer http://welkerswikinomics.com/blog/2008/08/29/does-a-free-market-lead-to-a-free-society-maybe-not/comment-page-1/#comment-5599 Daniel Drummer Wed, 03 Sep 2008 19:27:12 +0000 http://welkerswikinomics.com/blog/2007/08/27/does-a-free-market-lead-to-a-free-society-maybe-not/#comment-5599 In my opinon free markets do indeed lead to free society's because if someone decides to start a company, they have the right to break boundires and everything they decide is 100% their decision and not the governments. They have the ability to freely choose what to do. It enables Companys to do what ever they can to be succesful and have the greatest income possible. It helps your company become more recognizable and allows them to expand their companys to where ever they want. Free markets allow you to do what ever you want, and lets you risk what ever you want so it does indeed become a free society. In my opinon free markets do indeed lead to free society's because if someone decides to start a company, they have the right to break boundires and everything they decide is 100% their decision and not the governments. They have the ability to freely choose what to do. It enables Companys to do what ever they can to be succesful and have the greatest income possible. It helps your company become more recognizable and allows them to expand their companys to where ever they want. Free markets allow you to do what ever you want, and lets you risk what ever you want so it does indeed become a free society.

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]]> By: Max Nussbaumer http://welkerswikinomics.com/blog/2008/08/29/does-a-free-market-lead-to-a-free-society-maybe-not/comment-page-1/#comment-5597 Max Nussbaumer Wed, 03 Sep 2008 19:00:17 +0000 http://welkerswikinomics.com/blog/2007/08/27/does-a-free-market-lead-to-a-free-society-maybe-not/#comment-5597 Hand in hand is a wrong thing to say, i would say they play some of the same rolls. See because with a free market economy there are no rules well at least fewer rules but no boundaries. Each person is out for themselves. Since boundaries are more movable than rules it aloes the people in the country are able to choose without risk what they would like to invest in. The end product of this is a relatively high economy but everyone has a cap. A limit at which one has to stop at. But as this happens the greed starts coming out and more and more ownership is gotten. Which makes it lean away from communism. Because someone could be more successful than the other and get more money which in face is not communism at all. Thats why i think they do not go hand in hand but yes they are very very close. There still are a few little things that i don't understand so i can only tell my opinion on how much i know of this subject which is not all to much. Hand in hand is a wrong thing to say, i would say they play some of the same rolls. See because with a free market economy there are no rules well at least fewer rules but no boundaries. Each person is out for themselves. Since boundaries are more movable than rules it aloes the people in the country are able to choose without risk what they would like to invest in. The end product of this is a relatively high economy but everyone has a cap. A limit at which one has to stop at. But as this happens the greed starts coming out and more and more ownership is gotten. Which makes it lean away from communism. Because someone could be more successful than the other and get more money which in face is not communism at all. Thats why i think they do not go hand in hand but yes they are very very close. There still are a few little things that i don't understand so i can only tell my opinion on how much i know of this subject which is not all to much.

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]]> By: Paula Marin http://welkerswikinomics.com/blog/2008/08/29/does-a-free-market-lead-to-a-free-society-maybe-not/comment-page-1/#comment-5591 Paula Marin Wed, 03 Sep 2008 05:58:12 +0000 http://welkerswikinomics.com/blog/2007/08/27/does-a-free-market-lead-to-a-free-society-maybe-not/#comment-5591 I strongly agree with Dimitri's point of view. A free market does not go hand in hand with a free society. Now a days governments are working in order to satisfy their biggest "client" you could say, which are large and important corporations that bring in the countries income. Personally, I believe that its true when someone's income increases so does their influence upon other people and this turns to become an example to what is happening in the United States. In order for free market to go hand in hand with a free society I believe that the government should put a type of limit to large corporations in order that the smaller one's actually have a chance to succeed and give an equal opportunity for citizens. I strongly agree with Dimitri's point of view. A free market does not go hand in hand with a free society. Now a days governments are working in order to satisfy their biggest "client" you could say, which are large and important corporations that bring in the countries income. Personally, I believe that its true when someone's income increases so does their influence upon other people and this turns to become an example to what is happening in the United States. In order for free market to go hand in hand with a free society I believe that the government should put a type of limit to large corporations in order that the smaller one's actually have a chance to succeed and give an equal opportunity for citizens.

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]]> By: Felix B.-L. http://welkerswikinomics.com/blog/2008/08/29/does-a-free-market-lead-to-a-free-society-maybe-not/comment-page-1/#comment-5589 Felix B.-L. Wed, 03 Sep 2008 05:45:22 +0000 http://welkerswikinomics.com/blog/2007/08/27/does-a-free-market-lead-to-a-free-society-maybe-not/#comment-5589 Do free markets lead to free societies? In my opinion, free markets do lead to free societies. Suppose ordinary people have the opportunity to start any business they please, they will be more motivated to increase their profit and make their own business grow than if it is a government owned business. It would allow them to develop their own ideas on what they think could be a profitable product and sell it at their own price. This way, ordinary people will have a greater chance to become wealthier and to improve their financial situation. Some people might simply see money as “freedom”, but by improving their financial situation, they gain social status as well. In most cultures financial success increases recognition, and that in my opinion, is a very important part to freedom. Do free markets lead to free societies?

In my opinion, free markets do lead to free societies. Suppose ordinary people have the opportunity to start any business they please, they will be more motivated to increase their profit and make their own business grow than if it is a government owned business. It would allow them to develop their own ideas on what they think could be a profitable product and sell it at their own price. This way, ordinary people will have a greater chance to become wealthier and to improve their financial situation. Some people might simply see money as “freedom”, but by improving their financial situation, they gain social status as well. In most cultures financial success increases recognition, and that in my opinion, is a very important part to freedom.

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