Did the Obama camp scuttle a good thing well underway? Did Wall Street capitalism get insufficient opportunity to demonstrate the fruits of financial self-regulation? Or do excesses stimulate counter-excesses just as extreme hunger may trigger over-eating? Compromise capitalism is not the key! We need a fresh approach to capitalism Ã¢â‚¬â€œ a virtuous capitalism growing out of an honorable economic ethos.
The free market debate taken up by congressional candidate Rand Paul and his critics needs a new analytical lens. Free markets are not physical properties like precious metals or Ã¢â‚¬Ëœland, sea and sky.Ã¢â‚¬â„¢ Free markets express national culture, the evolving state of the public mind, traditions, fears, hopes and so much more. It is unintelligent to claim that free markets are Ã¢â‚¬Å“goodÃ¢â‚¬Â or that they are Ã¢â‚¬Å“bad.Ã¢â‚¬Â Generalizations do not address the dynamic variables inherent in markets, for markets are no better than the people who participate in them. Consequently, in times like these, market freedoms must be constrained. Scurrilous motives must be hemmed in by vigorous laws. Even so, the Founders said our constitutional liberties are only fit for a virtuous people.
Simplifications about free markets are more problematic than simplifications about fossil fuels, renewable energy or even federal taxes, for financial markets are dynamic and complex. The same goes for political parties, although the bad karma in recent times outweighs the good. Thus, if weÃ¢â‚¬â„¢re to intelligently to discuss David WeidnerÃ¢â‚¬â„¢s perspective versus Rand PaulÃ¢â‚¬â„¢s conclusions we need to dismiss simplifications and unsupportable claims.
No living person has observed a national free market, at least in the sense that free market advocates claim markets must be liberated to work their serendipitous magic. Every market failure is due, according to free market purists, to some complicating burden, some untimely intervention or some serial contamination of principle that prevents real market magic from breaking the economic sound barrier and proving its eternal reliability (and potential for listing on physicist charts of Periodic Elements).
It is bizarre how free market visions have warped into doctrinaire claims held more firmly by some Ã¢â‚¬â€œ and with even less evidence Ã¢â‚¬â€œ than Big Bang theorists use to explain universal history. Talk about a speculative overreach: Free market theorists make Lehman Brothers look like reach out novices.
Thomas Jefferson and James Madison generally had little difficulty identifying sophistsÃ¢â‚¬â„¢ arguments Ã¢â‚¬â€œ specious ideas not subject to normal evidentiary examination because the conditions are never Ã¢â‚¬Å“rightÃ¢â‚¬Â to allow claims to be tested. Even so, the free market mantra has become a devotional religion to some. Likewise, the Ã¢â‚¬Å“government-as godÃ¢â‚¬Â secular dogma has become religion to others. These Ã¢â‚¬Å“faith as politicsÃ¢â‚¬Â outcomes are consonant with the spirit of the age where temperance is broadly discounted while performance on extreme measures is lauded. Our heroes are the fastest, strongest, slyest, most propagandistic or whatever. TheyÃ¢â‚¬â„¢re not the most balanced, controlled, even-handed or non-partisan. Sadly, that part of religion is on its deathbed. Consequently, national character flaws are driving the free market debate into polarized madness, with the public interest at stake! Maybe the state of the debate is providential punishment for sins of ego.
If Jefferson and Madison were present with us they would give a tongue lashing to both camps Ã¢â‚¬â€œ free market and regulatory socialism. Republicans and Democrats alike would face criticism. Nevertheless, the right answers do not lie half way between the two sides. Political compromise is not the answer. The right answer is to think about markets and regulations in new, realistic ways. The market debate must be put on a multi-dimensional plane, variables and assumptions being re-evaluated as warranted by the facts.
Markets can only be as free as culture, character and wisdom allow. Conversely, markets SHOULD be set as free as possible within the constraints of the most prudent guidelines that can be devised. The key is to avoid regulation as much as possible, turning instead to the proper design of the market architecture and fundamental rules that create fair and economically productive playing fields.
Government cannot regulate the world into a higher realm, for inefficiencies, injustices and police state dynamics flow from excessive regulation. On the other hand, a world without prudent government regulation becomes a fearsome world, especially where culture tolerates foolhardiness. Good government minimizes the bureaucratic burden while maximizing the design benefits of proper architectures.
For example, put the bulk of the rewards of paper asset speculation into the public domain, thus reducing the burden of taxation on productive contributions. Put an end to fiat money by matching the size of the money supply to the most economically salient statistics, such as changes in productivity rates, business efficiency progress, population size, aggregate hours worked, and such. Link corporate tax rates to the prudence and sustainability of sector endeavors. Shift economic rewards from those who plunder public markets to those who meritoriously advance the public good. In sum, build incentives for markets to function for the common good rather than for markets to demonstrate dysfunctionalities as theyÃ¢â‚¬â„¢re gamed.
It takes a sophist to deny that national and international laws are broadly responsible for what markets are. If laws are so important to what Ã¢â‚¬Ëœfree marketsÃ¢â‚¬â„¢ are, then get the right laws to help free markets perform at their best. Shrink the regulatory growth of government by building markets that are innately resistant to wanton speculation. Crush big government, along with calls for government intervention, by creating simple, powerful laws that force businesses to compete for all theyÃ¢â‚¬â„¢re worth with parameters that ensure the national good. The regulatory burdens in this country are onerous because laws are written to create and protect lucrative opportunities for the few at the expense of the many.
The answer is not to rail against law but to fight on behalf of honorable law! Free markets are no more the answer to our problems than are extensively regulated markets. Prudent markets are what we need! We progress toward Ã¢â‚¬Å“prudent marketsÃ¢â‚¬Â by committing to a higher economic ethos Ã¢â‚¬â€œ an ethos that honorably matches merit and reward regardless of irrelevant demographics. This means the left gives up affirmative action and the right gives up its grudge Ã¢â‚¬â€œ both enervating to the common good because they create a disjuncture between deservedness and reward.
Rand Paul and Congressman Ron Paul do good service to America by battling establishment deceptions and banking excesses. Unfortunately, their battle against governmental foolhardiness attracts some supporters with counterpoised excesses, thus complicating the search for temperate solutions.
David Weidner makes a valuable contribution to the public good by highlighting troublesome errors within free market thinking as well as hypocrisies within regulatory movements. Thinking people do not hurl vitriolic criticisms at Mr. Weidner, for his observations brighten the future for American liberties to the degree that damaging licence is identified and squeezed out. Remember, the excesses of liberty are what give proponents of police state powers the excuses they seek to constrain traditional rights, especially the rights of economic self-determination.
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