Economic Fundamentalists
Posted by Trevor Mallard on January 5th, 2010
I’m not normally into Wiki but this one is good:
Market fundamentalism (also known as free market fundamentalism) is an exaggerated faith in the ability of unfettered laissez-faire or free market economic views or policies to solve economic and social problems[1].
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I like to refer to them as people who care more about graphs than people.
I quite like graphs – they can sometimes give a picture that helps people understand – I think they care more about dogma than facts.
I guess it’s how they’re used. This one, in particular, tends to be used with complete disregard for any sort of social conscience (by the fundies): http://wiki.dickinson.edu/images/f/fe/Graph1.gif
Headed by:
“The neutrality of this article is disputed. Please see the discussion on the talk page. Please do not remove this message until the dispute is resolved. (March 2009)”
I disclose my bias towards less intervention. From where I stand you have an “exaggerated faith” in the ability of the state to “solve economic and social problems”.
There was a book I read a while back that had heaps and heaps of stuff on this. Will try and find the name of it.
Yes Lindsay, because the unfettered and unregulated market has provided such wonderful social and economic outcomes, hasn’t it?
Oh wait…
Interesting reference to the Austrian School’s problem with market’s as ultimately self equilibrating.
The Austrian world model is ‘parts-to-parts’ as opposed to the Market Fundamentalist one of ‘whole-with constituent-parts’.
This means that the Austrian economic agent is only ever partially informed, rationality is ‘subjective’ (think “Prisoners’ Dilemma”). They did not agree with the Cartesian assumption of objective rationality that underpins Rational Decision Theory, the deeply flawed and enormously influential formal micro-economic infrastructure of Market Fundamentalism.
This, by the way, was the real problem that Hayek had with Keynes when he wrote The Road to Serfdom.
This philosophical difference also came up during the inquiries into the most recent financial collapse. You may recall that Allan Greenspan assumed that the financial system and the real economy were constituent parts of a holistic system and that rational decision making by bankers would ensure the health of the system overall. George Soros, on the other hand, argued that financial systems and the real economies (yes, plurals) are more like parts to parts and that bankers would act in their own best interests in the short term even if this was disastrous.
Asking “P2P or Holistic System” is much more interesting these days than asking “Left or Right”. I think that Helen Clarke’s interest in multi-cultural society with government as vector puts her as P2P. Rodney Hide and ACT definitely P-in-HS as is Don Brash. Allan Bollard possibly P2P. We can’t make any assumptions about what John Key thinks but it would be interesting to find out.
Raising Hayeks “Road to Serfdom” always creates a cynical little chuckle. His basic precept was that free unfettered markets are necessary to individual freedom, and that anything collective innevitably results in serfdom. This was written at a time that had seen the rise of collective capitalism and socialism (fascism and communism) and the collapse of the liberal laissez faire system.
More recent history would indicate that the freed markets have only made the rich richer and the poor more indebted…a sure fire road to serfdom. What we have now is a new feudalism where the gap between the wealthy and the serfs is becoming more entrenched. Hayek got this one 100% wrong.
What unfettered and unregulated market?
Good point, Quoth. Almost as good as “what communism?” when people complain about that.
Perhaps Trevor, the problem is capitalism itself – whether free market (liberal capitalism) or protectionist (Keynesian capitalism)?
Which economic system do you (and Labour) support? Since 1984 Labour has been free market, but under Clark you guys ‘took the edge off’ with a bigger social spend, which was possible in the economic boom. But now that “exaggerated faith in the ability of unfettered … free market economic views or policies to solve economic and social problems” has failed?
Perhaps you could adopt a few socialist & anarchist principles? I’m sure the Greenies could help with that
Or will you declare yourself a free marketeer, and sally forth to conquer the revolting masses with Sir Roger, Sir Doug and Sir Julian? (but not Sir Owen of the Glenns, hehe)
Andrew Straw – We literally do not have an unregulated market. That’s reality. People can argue about communism, but saying the market is unregulated bears no resemblance to reality.
bob – There are free marketeer anarchists and free marketeer socialists. I wish Labour would learn something from anarchists, but Labour are statists they are archists – they are in fundamental opposition – it’s like saying I wish you christians would adopt atheism. Being an anarchist in parliament would be like being a communist on the board of an investment bank or a pacifist in the military – those Greens who claim they are are no such thing.