As the economy collapses, and right-wing economic theory closes in on itself, never has it been more readily apparent, that right-wing thinking, is near completely and utterly without merit (the question is do right-wingers read anything or take in an information that is divergent from their already solidified views?).
For one there’s never been a pure capitalist (pure free market) system anywhere. What happens in real capitalist economies (at least since the early 20th century), is they develop social programs to mitigate the disparities of wealth that are intrinsic to capitalist economies. Another thing that happens (which I would say is conservative in nature, but that Friedmanites probably hate) is that powerful groups corrupt the political leadership so that the government unscrupulously does favors for particular interests (instead of doing what’s best for competition, consumers, the general welfare of society, etc…).
Two, more profits does not necessarily lead to more prosperity for everyone. Scandinavia, France, and most Western European countries all pursue policies that would make Milton Friedman (and his acolytes) cringe, yet they outperform the U.S. in health care, education, distribution of wealth, they have lower poverty rates, and they outrank the U.S. in most quality of life measurements. Ask a French worker, if he or she is concerned about economic growth. Economic growth that doesn’t have significant benefits for workers, and middle class people, is economic growth that benefits the corporations, the shareholders and the monied elites. The rest of us, don’t see the same kind of change in quality of life, that more social democratic policies would achieve (such as longer vacation time, a shorter work week, free higher education, free or government subsidized daycare, a guaranteed pension, government mandated severance pay when one is fired from a job, etc.). And of course the market is cyclical so the ‘good times’ don’t last very long, in which workers might see increases in pay, a good job market, etc. The benefits allocated in social democratic economies, of course, are not temporal, and can be taken advantage of at any point, and at any time.
Three, the most obvious, the market is not self-regulating. In fact, one of the major causes of the current crisis, is that a lax regulatory environment, ushered in the development of a shadow banking system — where complex financial instruments were created by the investment community and traded privately outside the existing regulatory framework.
Milton Friedman, the ’sage’ of right-wing economic orthodoxy, was at least somewhat oblivious to what was occurring in the real economy. A witness to a Friedman lecture back in 1991 (in which Friedman recommended the destruction of Medicare, welfare, the postal system, Social Security, and public education), remembers a woman in the audience who asked what would the prescriptions of his lecture mean for poverty in America? Friedman replied to his questioner, “There is no poverty in America.” A voice could then be heard from the back of the lecture hall call out, “Bullshit.” And the audience roared loudly in agreement.
