Market Illusion and Right-Wing Hypocrisy.....

Today in Ottawa a number of so-called pirate cab companies were indicted on charges of operating illegal taxi services in the City. I find this quite amusing. Do you think any mainstream right-wing commentators will complain about these indictments with the suggestion that in a ‘free-market’ anyone should be able to run a cab company if the clients are out there to pay for the service? I don’t think you will hear any such complaints from right-wing ideologues. Instead they will quietly ignore this remarkable, but incredibly common, contradiction in their ideology. This is because they don’t really believe in a ‘free-market’ at all.  A real ‘free-market’ would be one in which anyone could practice as a taxi driver, or a physician for that matter, and it would be up to the buyer to determine whether the person selling this service is legitimate and trustworthy.

The fact is that, with the exception of a few extremists, no one really believes that markets can self-regulate or function at any practical level without extensive regulations and control. But right-wingers constantly want promote the idea (and the illusion) that somehow they are committed to a free-market. Instead, what the right-wing is committed to is extensive regulations that are targeted at aiding certain kinds of companies, producers, and service providers. And this selectively regulated market approach is designed to make big money for big capital and leave average people to wallow in poverty.

Lack of Leadership

There really is no serious leadership in the political system today, at least at the highest levels. In Canada and the US conservatives are using recent economic problems to obtain tax cuts, an idea with which they have become obsessed; an economic move that will, in the long run, further complicate the basic problems that Capitalism is now suffering. Meanwhile conservatives, in their public discourse, are simply ignoring the fact that it was their policies that got us into this mess in the first place. The government of British Columbia passed a ‘balanced budget’ law a few years ago when they had convinced people that such a profoundly stupid idea was economically responsible, and now that have been forced to rescind the law in special session of the legislature. (Rather embarrassing if you ask me)But the past obsessions of Conservatives with tax cuts and deregulation has suffered a devastating and obvious discrediting; the only ones who don’t seem to realize it is, of course, conservatives. However, little leadership is being demonstrated on the other side of the political aisle. When the depressions and economic problems of the late 19^th and early 20^th century hit, it led to the progressive movement and major reforms to the economy including the move toward anti-trust laws. In the 1930s Roosevelt oversaw more significant changes to how capitalism functions with the creation of the welfare state. But today? There is really little or no talk of any serious changes or reforms to how capitalism works. We are going to build a few new bridges and fix some roads, but little else. Governments in a number of countries have made major investments in some capitalism enterprises like banks or insurance companies, and this even lead to a cover of Newsweek magazine that reads “We are all Socialists Now.” But this is obviously laughable. Governments have done nothing serious to overcome the problems that have now manifest themselves in the economy. Infrastructure spending will have little long-term effect on how the economy works. Politicians are just hoping to ride out the storm and stay afloat. Instead of bailing out banks governments should have taken that money and created National banks which could give low-interest,  loans with thirty-year terms to people seeking mortgages, as well as loans for small-businesses, thus by-passing some of the most blatant negative effects of market fluctuation on average people. Furthermore, the recent credit crisis has put so-called public-private partnerships in question. (See Mike Old’s article in this month’s HEU Guardian http://www.heu.org/~DOCUMENTS/Guardian/OWM/GuardWinter08_WEB_1.pdf) But governments are loath to give up policies that have gone so far to benefit their corporate friends in recent decades. Essentially, in the past thirty years or so, Governments have systematically designed economies in a way to divert money from average tax payers to large powerful corporations (much of it in the military sector). This has led to greater discrepancies between rich and poor, the gradual impoverishment of the middle-class, and outrageous profits that have mostly benefited the rich. Besides paying lip-service to the issue of Wall Street bonuses, these issues are not really on the radar of mainstream political discourse. But capitalism will crumble before their very eyes and until there is some genuine leadership, average people will pay the worst part of the price for this decay. 

Market disasters and government bailouts

Why is it that over the past one hundred plus years, every time so-called conservatives and the right-wing deregulate markets and let ‘capitalism’ move unfettered, they bring us to the brink of total economic collapse? It happens over and over again. In the past century some of the major meltdowns have been 1907, 1929, 1987, and now 2008. And here is the kicker: every time this happens, the free-market gurus called in the government to bail them out and save them from ruin! This is the government that they never tire of telling us is inefficient and totally useless. Well, if it is so useless why does the market need it so often to come to the rescue? There are, of course, a few simple answers to this question. First of all, ‘free’ markets are a myth like the Yeti or his north-American cousin the Sasquatch. Almost no one has really believed in ‘free’ markets for well over a hundred years. What conservatives and the right-wing really believe in are selectively controlled and regulated markets designed to maintain the profitability of banks and large corporations. If we really had a ‘free’ market the system would collapse before you could say ‘junk-bonds,’ leading to mass-starvation and chaos. The reason that the Right pretends to believe in ‘free’ markets is because it creates a smokescreen for the so-called conservative agenda in which the rich get richer and average people get the shaft. And the poor saps who buy this imaginary ideology keep voting for the right-wing which works against the interest of the vast majority of people. But of course the right-wing, market gurus are happy to use the tax money of this majority to bail the ‘market’ out of disaster.

The fact is that markets, even well regulated ones, simply don’t work very well, particularly in areas of society concerned with ‘social’ interests like education or health-care. When markets are allowed to even partially function in these areas of society they only serve to highlight the discrepancy between rich and poor. When are the people going to wake up to the lies that the right-wing has been peddling all this time about inefficient and useless governments and the divine perfection of the market? But I suspect that not enough people will realize the sham and if the government is able to bail out the system again this time, twenty or so years from now we will be right back where we started with the useless and inefficient government once again saving the infallible market!

Make no mistake, Stephen Harper’s entire ideology is giant confidence trick perpetrated with smoke, mirrors, and misdirection. It is time for us to stand up and admit that markets need more regulations not less, and market forces need to be kept out or more parts of our society to avoid social inequality and disaster.