The Free Market is the Legal Entrenchment of Previous Inequities

[Idaho]

Time for something we all love - a mass debate. Try and stay on point. This is a discussion of the nature of the free market, not of alternative systems. I am using the UK as my model, but feel free to depart from these shores.


I propose that the free market is a misnomer. It's is the entrenchment of centuries of inequity and privilege. And the regulations and controls on this market are made in the interests of those with the most wealth and power.

For example, with a few very obvious and extraordinary exceptions, which orgahs will doubtless furnish, the vast majority of wealth is inherited. Those with wealthy parents will use their wealth to secure privileged schooling, giving those children ready access to the circles of power and influence.

The so-called 'free market' is the extension of a system that presided over slavery (in this country and others) and where the noble class could control commoners and the poor at a whim.

The advantage gained from these early 'robber baron' years was consolidated through the rule of law. Sealing this advantage in place. Rules on what can be traded and how it can be traded are now strict. Mainly to protect existing enterprises. Professional and influencial bodies such as control medicine and the law draw their membership disproportionately from those with privileged education.

The market itself is rife with controls, regulations, restrictions and laws. For example the right for groups of people employed in an industry to take collective action is tightly controlled.

In what sense is this current system a 'free market'?

[PanzerJaeger]

In what sense is this current system a 'free market'?

It isn't. Obviously no first world nation has a free market economy. Heavily regulated capitalism is the order of the day, as you alluded to. However, government regulations are at least nominally in place to protect consumers, not to entrench wealth, as estate taxes make perfectly clear.

You seem to be confusing the effects of a free market system with its definition. The "free market" is free solely because the vast majority of production is based on market demand, not government mandate. It has nothing to do with any assumption of morality or equity.

A lot of people attach moral superiority to the free market concept because it has allowed for untold numbers of "rags to riches" stories and has generally increased the standard of living for all classes, but those are just products of the system and do not define it.

Inheritances, gaps between the rich and the poor, and social inequalities are also results of a system based on capitalism, but do not change the "free market" concept. Remember, though, while no one likes a trust fund baby, unless he is descendent from nobility or some such, that money had to be earned at some point. If you don't like the idea of inherited wealth, blame the natural desire of the parent to make a better life for the child, not the system, which does not mandate wealth be passed on as opposed to left to charity or something else.

[Beskar]

"Free Market" is a concept of the Market without regulation.

It becomes very interesting, because people have different definitions of "Free".

There are those which say all the problems are because of government regulation for some reason, and it is this which stands in the way of progress. However, as PJ said: "government regulations are at least nominally in place to protect consumers". Thus, to protect consumers, there are regulations against cartels, monopolies, and other concepts and ideas around this.

In a way, this regulation is "socialist", as it is there to protect the people from the exploitation of those with mass wealth.

On the other hand, "Socialism" is a swear-word in America. Any regulation is seen as an affront to "freedom". This is capitalised by those in the conservative media, which is heavily backed by the worse-offenders, in order to assist in lining their own pockets, thus you get a great number of people who classify themselves as conservatives which want to remove the barriers protecting people from them. This is also a similar trend in Europe as well, but on a far-more decreased scale.

Quoting from PJ again (I hope he doesn't mind):

The "free market" is free solely because the vast majority of production is based on market demand, not government mandate. It has nothing to do with any assumption of morality or equity.

Advocates and the reality of the "Free Market" is not the benefit of mankind, or some greater purpose, it is solely to do with wealth. How much can you sell something and how rich can get from it.

This is a common-trend as seen in parts of Europe (definitely Britain), where there were many public services (which have a mandate) versus private sector (only out to get wealth). The public service has a duty and mandate to perform, and if these are ran inefficiency, it can culminate in cost, especially if operated in certain methods (such as from tax-payer budget funded, opposed to government-ran service which gets funds from the market system). Because of the mandate, the government-ran services operated in places where it was needed, but wasn't active, so they used to operate on bus-routes which might have only barely covered the cost, or even at a loss, in order to perform their mandate. When privatisation of these services occurred, the mandate was no longer there, which resulted in significant increases in price, price-tiered systems, routes no longer used, and from what used to be a nice journey from A-to-B at a reasonable cost is now 5 different bus journeys costing an arm and a leg. This also resulted in private-companies just fleecing the traditional system for as much wealth as they can get out of it.



While I covered different aspects explaining the differences between public-service and the privatisation process (mandate vs. wealth) , and to regulation (consumer protection), I will address to original point of "Free-Market is the Entrenchment of the Previous System".

I would actually move to state that the free-market was a move from removing power from the aristocratic "Blood" system to one based on wealth and its accumulation "Bourgeoisie". To do this, instead of focusing on the similarities, you focus on the differences. Previously, wealth was given to those based on blood. If you was some one of Noble birth, you have a wealth to your name which no one could buy. You might be a famous wealthly merchant, but you was always below a Noble, even when they were in poverty, according to this system. As you can expect, when opportunities to acquire wealth wasn't limited simply to the land you owned, which was entitled by the King (biggest blue blood of them all), this gave power to those of not-so-Noble birth. It was these "Bourgeoisie" who wanted rights for themselves, and the means (the wealth), overthrew the old aristocrats.

Now, let's look at the similarities. Both these classes (Aristocrat and Bourgeoisie) both had access to wealth. The old traditional schools of the Aristocrats, also became the schools of the bourgeoisie. The old traditional entitlements of the Aristocrats, also became the entitlements of the Bourgeoise. While we prolertariat plebians, were still at the bottom of the wheelbarrow, just slightly above slaves in status.

So is the new system the entrenchment of previous inequities? No. Is the new system an expansion in Franchise? Arguably Yes.


tl;dr version in a picture:
https://img28.imageshack.us/img28/3536/pyramidofcapitalistsyst.jpg

[Crazed Rabbit]

The Free Market is actually the best way for people to raise themselves up and improve their financial situation.

Many regulations, like those proposed by Democrats (here serving the role of the party that purports to fight for the poor and less well off) to combat evil ole big business, in fact hurt small businesses, and their less wealthy owners, much more than the big businesses who can more easily afford the lawyers to deal with the regulations.

Similarly, the income tax, again championed by the Democrats serves as a disincentive to earn more and better your situation and doesn't actually tax wealth, thus hurting the people trying to get richer more than the people who are already rich.

Nevertheless this still represents the best real world situation for the poor to better themselves; the barriers protecting nobility and the wealthy class have been thrown down. You say the vast majority of wealth has been inherited. In the US we have, or at least had, the Rockefellar dynasty. But even that was begun back in the late 1800s by a man who was not rich. Or the Kennedys, made rich in the 1920s.

This is a free market in the sense that it's one of the freest the world has ever seen. You say the many regulations largely prevent the poor from becoming richer. Surely the obvious solution is to get rid of those unnecessary regulations. Get rid of doctorship internship limits and tight controls on providing legal advice.

It is interesting to note that many of these controls are pushed by the Democratic party - the party that claims to represent the poor. I suppose it is indeed in their interest to make sure the poor don't succeed and raise their fortunes.

CR