Even after the economic implosion of the last two or three years, there are still many Americans who believe that markets are going to deliver on the promises of prosperity that mainstream economists craft for them.  Markets have proven themselves to be unable to bring prosperity.  Wealthy nations were not made wealthy by following the prescriptions of those who advocated free markets, and those nations who have followed most closely such prescriptions are the most destitute.  The most obvious case is that of the United States, which in its time has pursued high tariffs, the monopolization and cartelization of industry, the socialization of the costs of businesses, and the direct public funding of some of the most important industrial innovations of the twentieth century, including the computer, the Internet, the jet engine, space travel, et cetera.

Let us suppose that the proponent of the market – not necessarily a neoliberal or even libertarian, but anyone who conceives as the market as a primary means of social organization – concedes that the market may not produce prosperity.  Generally such advocates will not concede this, until mass unemployment strikes, in which case this is a tragedy that must be borne, even though we have long known how to relieve unemployment.  In any case, you might have found that rare proponent of market organization that might concede that markets do not consistently produce prosperity.  However, the market-proponent will say that this is the price we must pay for the freedom that the market provides.  Some may remain poor, but they are least free.  That is what this article refutes – the market is not a social organization in which the freedom of the individual is realized. Markets not only fail to deliver prosperity, but also freedom.

Before someone tries posting about “government coercion,” this article is not a plea for more “government intervention,” at least not in the conventional sense.  The alternative to distribution by the market is not distribution by a bureaucracy.  Humanity has employed many different forms of distribution in which government was only the guarantor (as it is with markets), not the provider. Continue reading →