How is the free market a good thing?

A true free market is probably impossible, given human nature (just like pure collectivism).

Still, I’d rather have our semblance of a free market than a Soviet style control economy.

I agree that there can be too much control, but is total Laissez-faire the way to go? Is there no middle ground?

@jerv, I think we’ve gotten as close to the “middle ground” as possible. We have a metric shit-ton of regulations on the books, but it is still relatively easy to start and run a business in the US.

I find myself preferring not so much the freedom of the market as much as the absence of excessive meddling. I don’t like the idea of anybody that I can’t talk to meddling.

@jerv, I’m not sure I understand your questioning of the “middle ground”. Do you think we have relatively un-free markets now? (I’m assuming that you’re from the USA; let me know if I’m wrong in that assumption.)

But my local Stop & Shop, for example, is a pretty good example of a relatively free market. There are some government regulations regarding package labeling, packaging quality, grading and sizing of various food items. There are safety regulations on some of the goods that are sold. But these, while they surely aren’t “pure laissez faire ”, aren’t really stifling all that much competition, either.

I’m not sure where you’re coming from with this question.

Thus far in history, free markets have proven themselves to be the most efficient, fair way to distribute resources in a society. I think it is very hard to find evidence to the contrary.

However, any capitalist economist worth her salt would also tell you that there are such things as market failures: situations in which the market does not do a good job of allocating resources efficiently. Some good examples of common market failures are markets with negative (or positive) externalities, monopolies, and markets for common goods. These are situations in which government action and regulation actually lead to better outcomes. The trick, of course, is both distinguishing between actual market failures and outcomes we simply don’t like, and also finding the right government intervention for when we do identify real failures.

Despite claims by some prominent right-wing media personalities/grassroots activists, the United States generally errs on the side of letting markets do their thing without much intervention. This is true especially in comparison to other developed capitalist societies.

@Michael I think you get where I am coming from here the best.
(I wish I were able to elaborate better on what’s really on my mind here)

I often say that America is a hybrid. We are a mix of a free market, regulation, and government programs and controls. I think of the regulations as an attempt too control greed and corruption. The regulation should be what is reasonable if everyone was running their business with integrity and the golden rule. Communism and socialism have a lot of problems, it has been proven over history, so I see no need to pursue that, although I would guess there are some positive things associated with them. Capitalism has proven to have some problems also, I don’t see why we must think of things in black and white, as some politicians want us to, but to think of these matter in shades of grey, hoping to improve our hybrid system.

Many of the problems associated with Communist models are, or were exacerbated by fanatical American opposition and deliberate sabotage on ideological grounds. For example the Cuban economy is judged as a failure, yet American policy forbids it’s people to trade with Cuba. Not only that, America exerts it’s pervasive influence on any country that has, or wants to pursue economic links with Cuba. The ultimate hypocrisy being that America refuses to engage with Cuba economically on ideological grounds yet leases Guantanamo bay. If America is that determined to press home the point of Zero trade tolerance, you have to wonder why Guantanamo is the exception to the rule. A little tangential but nonetheless….

@mammal I agree we should trade with Cuba. But, remember that Cuba trades with many countries. Cuba does not have a huge population, so although I agree trading with us would bring them the possibility of a better economy and more prosperity, there is certainly plenty of other countries who can buy their goods. My brother-in-law does business there. He says the country is awful. Things are broken down. He tells a story of renting a car there and how the Russian car had just one handle that he and his business partner had to borrow from each other to open the windows, because they had fallen off. The story is actually very funny when told by him, but not so funny. My husband’s cousins were in Cuba recently to get some medicine (by the way we think the medicine might be part of the reason his cousin is doing so well battling pancreatic cancer. A medicine not available in the US or Mexico. I am not sure if it is available in other countries, or if it is just a Cuban drug?). Anyway, they said it was horrible also. They didn’t want to eat anything, wanted to get out as fast as possible. Policy regarding Cuba is purely a Florida/Miami policy in my opinion. It is about politicians in FL wanting votes.

@mammal, mostly nonsensical, actually. Canada is still the top trading partner of the US the last time I looked, and has been for many years, and yet still trades with Cuba, as does Mexico, most of Europe and all of Latin America. I think our trade barrier is stupid pride on our part (“good enough for my daddy, so good enough for me”—and to coddle a sold bloc of Florida voters, who are vital to most national elections now), but your wording about our “pervasive influence” is a non-starter. As is Communism itself, actually.

Now you might want to bring up North Korea, and how we are preventing all of the babies there from getting a decent meal, too…

Yes, as long as it doesn’t mutate into predatory capitalism.

@mattbrowne…like our current system seems to be.

Anyone who has lived in a small farming community has experienced a true free market and it works very well. All the rest of us are stuck with government regulation and subsidies, and lack of any orderly enforcement of protections or natural exercise of a true free market.

In my area, we have farmer’s market, and food co-ops. For people who shop sensibly, we can have a semblance of a free market, but it is a very small pocket of society.

@YARNLADY Interesting. I don’t think it is just government interferance or lack of enforcement, I think problems also come when things get to large, or someone has a monopoly. Big businesses become like mini-governments in my mind. I think it works where you are because it is a small community where people understand the value of working with each other and treating each other with integrity, an absence of greed, a feeling of interdependence. What do you think?

@JLeslie Yes, I agree that greed is the biggest cause of failure in a free market. It leads to false manipulation at the corporate and government level.

@YARNLADY I argue with my father about the definition of greed. He says greed is simply wanting to make money and that powers capitalism. I think it is not greedy to ask a fair price, but that there is a line some cross that goes into greed. Asking a incredibly high price because you can is greedy to me, not playing by the golden rule.

@JLeslie I concur, but who defines “fair”? In some cases it’s fairly obvious, but in others it isn’t. For instance, what is a fair price for a computer operating system? Is it fair for me to pay more for a computer because Microsoft cut a deal with the PC makers to preinstall something I don’t want on nearly every PC made, or would it be more fair to ship systems blank, allow advanced users to install their own OS (I bought a copy of WinXP once and see no need to buy it again so long as I only have it running on one system at a time as per the license that I already paid for), and not suck money from the wallets of Linux users? And does it really cost $49.70 to prescribe/administer two Tylenol? If so, then my aunt (and all other nurses) should be making at least $1500/hour.

@YARNLADY Some things naturally break down when they get too big. As someone who grew up in New England (farms, co-ops, etcetera), I miss having a truly free market. Since moving to a city, I am largely at the whim of mega-marts and conglomerates if I want to eat.

@CyanoticWasp don’t be smug and annoying and ill informed and….well i’ll leave it there.

@mammal, no, we’re not so alike as that.

@jerv I did a search on farmer’s markets in New York Ciy and food coops in New York City and found hundreds of listings.

@jerv Certainly “fair” is arguable. $49.70 for two tylenol is an outrage, I don’t know how anyone can call that fair? When the American car companies in the 70’s were making billions, instead of treating employees fairly or using better parts, or making safer cars, or lowering the price for the consumer, they chose to keep making lots of money, eventually having to give away some of it to union concessions. This wound up being a bad policy because of competition, thank goodness the Japanese were able to export their cars, because it helped us get safer, more reliable, less expensive cars. The big three would have kept on doing the same old thing if they could have gotten away with it. They did do the same thing for years and lost a lot of their market share. This is a case where the free market worked, at least for the consumer, but also proves that these companies really had no care for the golden rule.

Even little things like I am annoyed that my salad is $5 with an entree and $8 without one. Worse, at many restaurants the lunch and dinner menu are exactly the same, same portion size, but more expensive during the dinner hour.

It seems like free market can go either way. If there is no competition the consumer can get really screwed, if there is competition is works for the consumer, unless everyone just decides to charge a lot for the same thing. You have to hope a discounter comes along.

@YARNLADY Not worth the 2400+ miles worth of gas. Pikes Market is about the closest we get around here (that I’ve found so far) but somehow not the same. It is, for lack of a better word, “Citified”.
Also, Google and Reality are sometimes at odds, so take those searches with a grain of salt… unless you think taking a left off of Aurora at the 46th St. underpass is a good idea. The search for great bacon and fresh dairy continues…

@JLeslie Pretty much. Of course, the only way to prevent monopolies and collusion (aside from making the world into a Utopian fantasy full of fairy-tale endings) is to have an outside party with no vested interest laying down some ground rules.

@jerv Right, and then we are back to government regulation, or some call it interference.

@jerv I was using Yahoo map to get somewhere just yesterday, and it would have me turn right straight into a creek that separates the road at that point. On the map, the road goes through, in reality, it doesn’t. When I contacted Yahoo Maps about it, they said I had to contact their source. Such a run around. Map Quest thanked me when I sent a correction to their map, and sent me a t-shirt, and did Via Magazine,

@YARNLADY I love that you do that, give companies feedback to improve their service. I do that too.

@YARNLADY I often disregard my Magellan in favor of advice from my roommate who has lived here for >15 years and used to be a taxi driver.

@JLeslie It’s all a matter of perspective, and different people draw the lines in different places. Personally I feel that a Republic should act in the best interests of the entire nation and not just a select few.
Of course, the “greater good” requires that some people get screwed, but I think that sacrificing a few thousand uber-rich people (make them survive on $3million/yr instead of $30 million) to improve the lives of tens of millions who can’t even afford food and/or shelter is fair.
Now, if you want anything beyond the bare minimums (i.e. filet mignon instead of government-issue canned meat product) then you have to earn it. However, I don’t think that the fact that I only make enough to drive an ‘85 Corolla instead of a 2010 Mercedes makes me unfit to live.

BTW, Have you read the Universal Declaration of Human Rights ? It seems that the US falls shoret of that in a few key areas and it saddens (and sickens) me that the mightiest, wealthiest nation on Earth does worse than some Third-world countries and/or dictatorships in any area covered by the UDHR.

@jerv I agree with you. I will have to read your link, I have not yet. ou may have seen me comment about my sadness and frustration regarding the working poor. People who work hard every day, with integrity, who just want to live an honest life. I think they should be able to live safely (our ghettos in the inner city tend to not be safe enough for my taste). When I here a company or an owner is making a million dollars a year and he has employees barely scraping by, my mind goes to can’t he make $900K and compensate his staff just that little bit better. That is the greed for me, it might be very little for the owner, but a mountain full of money for the employee. I think be generous. Not generous to the point that a person hurts themselves or their own family, but if it barely is making a dent, why not reward the people who help you make so much money? Maybe it would not be more pay to each employee, but hiring two more employees to ease the work load? Whatever the case, not one should feel like a slave I think.

Did you see Oprah about life around the world? Denmark was one of the countries featured. Most are done with their work day between 4:00 and 5:00, happiness is greatly valued, everyone makes around the same salary so you can pursue a career in what interests you rather than pursuing money. It was very interesting. If it was a warmer climate I might consider moving.

I believe that any economic system, any political system, would work except that people have a tendency to be jerks.

@Nullo I think that that is pretty much the problem right there. Any system is able to be abused.