If there were an
Economist's Creed, it would surely contain the affirmations, "I
believe in the Principle of Comparative Advantage," and "I believe in
free trade."
- Paul Krugman, MIT economist, 1987
The difference between a system dominated by General Motors and
Exxon and one based upon the individual landholding farmer and small
business persons of an earlier day in American history may very well
be greater--in the real life experience of the average person--than
the difference between a system based upon large private bureaucracies
in the United States and public bureaucracies in socialist
nations.
- Gar Alperovitz, "Building a Living Democracy."
In the quest for economic growth, free market ideology has been embraced around the world with a near religious fervor. The beliefs espoused by free market ideologues are familiar to anyone conversant with the language of contemporary economic discourse.
These beliefs are based on a number of explicit,
underlying assumptions imbedded in the theories of neoclassical
economics.
To put it in harsher language, these ideological doctrines
assume that:
A number of valid ideas and insights have become twisted
into an extremist ideology that raises the baser aspects of human nature
to a self-justifying ideal. Reminiscent of twentieth-century Marxist
ideologues now passed from the scene, advocates of this extremist ideology
seek to cut off debate by proclaiming the inevitability of the historical
forces advancing their cause. They tell us that a globalized free market
that leaves resource allocation decisions in the hands of giant
corporations is inevitable, and we had best concentrate on learning how to
adapt to the new rules of the game. The extremist quality of their position is revealed in the
stark choices they pose between a "free" market unencumbered by
governmental restraint or a Soviet-style, centrally planned,
state-controlled economy in which government makes all economic decisions.
They countenance no middle ground, such as a market that functions within
a framework of democratically determined rules. Similarly, they divide the world into two groups: "free"
traders who would remove all economic borders to allow goods and money to
flow unimpeded by public oversight; and the protectionists who would build
impenetrable walls around countries, cutting off all trade and exchange
with others. Again, in defiance of history and logic they recognize no
middle ground, such as the possibility that governments might establish
appropriate rules to assure that cross border exchanges are fair and
balanced to the mutual benefit of people on both sides. The most descriptive label for those of this ideological
persuasion is corporate libertarian, because whatever they call
themselves, the "free" market, "free" trade policies they advocate do
not free trade, markets, or people. Rather they free global
corporations to plan and organize the world's economic affairs to the
benefit of their bottom line, without regard to public
consequences. THE CORPORATE LIBERTARIAN ALLIANCE Three major constituencies have joined in a powerful
political alliance to advance the ideological agenda of corporate
libertarianism with a dogmatic fervor normally associated with religious
crusades. Neoliberal Economists. Neoliberal economists
embrace two first principles as fundamental articles of faith. One is that
individuals are motivated solely by self-interest. The other is that
individual choice based on the unrestrained pursuit of self-interest leads
to socially optimal outcomes. [See The Betrayal of Adam
Smith.] Neoliberal economists provide corporate libertarianism
with a patina of intellectual legitimacy. Property Rights Advocates. Ardent property
rights advocates, sometimes called "market liberals," commonly present
themselves as libertarians dedicated to the defense of individual rights
and freedoms. While true libertarians seek to defend individual freedom
against intrusion from coercive institutions of any kind, market liberals
are mostly concerned with protecting the rights from property from public
accountability. Those without property have no rights that the market
liberal is bound to respect. Market liberals give corporate libertarianism
its cast of moral legitimacy. Corporations and Members of the Corporate Class.
Corporations and members of the corporate class--such as corporate
managers, lawyers, consultants, public-relations specialists, financial
brokers, and wealthy investors--comprise the third pillar of the corporate
libertarian alliance. Some are drawn to corporate libertarianism purely by
financial self-interest or because they are paid to do so, others by moral
conviction. Although few members of the corporate class have a serious
interest in the fine points of academic theories or moral philosophy, they
find a natural common cause with those who provide an intellectual and
ethical case for freeing corporations from the restraining hand of
government and absolving them of moral responsibility for the social and
environmental consequences of their actions. Furthermore, they have the
financial resources at their disposal to handsomely reward those who
legitimate their power. This combination of economic theory, moral philosophy, and
elite political interest makes for a powerful alliance. Yet in many ways
it has served even its own members poorly, as its corrupting influence has
not been limited to the broader society. It has led neoliberal economists
to seriously debase the integrity and social utility of economics by
reducing it to a system of ideological indoctrination that violates its
own theoretical foundations and is deeply at odds with reality. It has
similarly engaged libertarians in a cause that violates their own
commitment to individual freedom, as corporations infringe on the property
rights of real people and use their growing power to suppress the
individual freedoms of all but society's wealthiest members. The enormous
political success of the alliance in shielding corporations from public
accountability has create a monster that even the members of the corporate
class no longer control and is creating a world that they would
scarcely wish to bequeath to their children. THE MORAL JUSTIFICATION OF INJUSTICE The moral philosophers of market liberalism perpetrate a
serious distortion by neglecting the distinction between the rights of
property and the rights of people. Indeed, they equate the freedom and
rights of individuals with market freedom and property rights. The freedom
of the market is the freedom of those with money. When rights are a
function of property rather than personhood, only those with property have
rights. It is a basic premise of democracy that each individual
has equal rights before the law and an equal voice in political
affairs--one person, one vote. We can rightfully look to the market as a
democratic arbiter of rights and preferences only to the extent that money
and property are equitably distributed. Although a market can allocate
efficiently with less than complete equality, when 358 billionaires enjoy
a combined net worth of $760 billion--equal to the net worth of the
poorest 2.5 billion of the world's people--the market is neither just nor
efficient and it loses all legitimacy as a democratic
institution. Created on ... août 17, 2003