Free Markets? Yeah right!
The best short answer is, the illegal drug trade, beyond that and there is not much of a free market. That is about the only part of our economic system that is truly free, the rest is monopolized, controlled and collectivistic.[ad#ad-4]
Competition is a fine thing, but somewhere along the road someone figured out that competition lessens profits where a combining increased those same profits. In reality the whole concept of “free market enterprise” was on the way out by 1875. And by 1888, trusts and monopolies had a strangle hold on the American economy. It was so pronounced that Pres. Grover Cleveland said in a speech to Congress, “As we view the achievements of aggregated capital, we discover the existence of trusts, combinations and monopolies, while the citizen is struggling far in the rear or is trampled to death beneath an iron heel. Corporations, which should be carefully restrained creatures of the law and the servants of the people, are fast becoming the people’s masters”.
Because of this concentration of the “traditional American system of free competitive enterprise” no longer exists. In its place is a concentration of economic power in a few hands—a monopoly. Free markets are an extension of what is called Laissez-Faire economics, which is basically no regulation, no interference in the markets. That brings us to the current economic age where all talk about the free markets, but by definition there are none. There is however, interference by the government on the markets through regulation and such and because of this interference the markets are failing.
The multinationals that we have today fly into the face of the “free market” concept. Why? Because in this concept there are no large corporations, but rather many smaller units in competition with each other. So when one fails it is negligible not the devastating crush we have now. And the consumer is in control, say coffee and milk are expensive, then the consumer enmasse stop buying the product and the price will come down, at least that is the theory. Why? Because there are so many competitors that it would be impossible for collusion to take place.
So when you listen to your politicians rant on about this free market or that, ask them to explain it to you. I would bet a dollar to donuts that their explanation is nothing near what is really meant by the theory. Today, without government intervention the financial crisis would topple the government and the economy, this is the beast that the multinational corporations have created and it cannot be stopped. These imperfections, man made, by the way, is what prevents the markets from existing and operating freely.
Written by: Lobotero
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Tagged as capitalism, definition of economy + Categorized as Economy articles