October 29, 2007 at 07:36:43

Why Are Free-Market Economists Still Taken Seriously?

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By Marc McDonald (about the author) Page 1 of 3 page(s)

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By MARC MCDONALD

They've been shown to be wrong time and time again. And their policies have led to widespread disaster and misery for millions of people.

Who am I talking about?

The NeoCons and their wrong-headed views on Iraq?

Nope, I'm talking about free-market economists.

No group of "experts" has a worse track record on accurate information about how our world really works. And yet, mysteriously, free-market economists are still held in reverence and awe by many. And their proclamations are hailed as the gospel truth by everyone from politicians to academia to the mainstream media.

Free-market economics seemingly got an enormous boost in credibility in the 1980s and has reigned supreme as the only conceivable policy for running America's economy ever since.

There's only one problem with free-market economists and their followers: they're full of crap and they have a dismal track record on the truth. And worse, the world simply doesn't operate the way they believe it does.

Free-market economists are rabid advocates of a unfettered, dog-eat-dog, ruthless form of capitalism. Leaving everything to the "free market" is the best way to run a society, they maintain. And at the end of the day, no other economic system can possibly compete with capitalism, they say.

As "Exhibit A," the free-market economists proudly point to capitalism's vanquishing of the Soviet Union's style of communism in the Cold War.

What more proof could one want that capitalism is the best way to create wealth and prosperity?

Actually, in the years since the Cold War ended, a few dissenting voices have started to speak up about the supposed superiority of unfettered capitalism.

First, there is the issue of whether the United States really prevailed in the Cold War, after all. A number of commentators have pointed out that, without enormous sums we borrowed from Japan in the 1980s, the U.S. wouldn't have "won" the Cold War.

Indeed, as the brilliant author Chalmers Johnson has pointed, out, it was really Japan, not the U.S. that won the Cold War. Indeed, the decade of the 1980s was nicely summed up by MIT economist Lester Thurow when he wrote: "We borrowed a trillion dollars from the Japanese and threw a party."

I should point out here the irony of celebrating an economic system that is totally dependent on vast amount of foreign capital in order to function. And make no mistake, no matter how one views the Japanese economy, it is definitely NOT anything that a Western economist would recognize as "capitalism."

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The creator of the progressive site, BeggarsCanBeChoosers.com, Marc McDonald is an award-winning journalist who worked for 15 years for several Texas (more...)

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