Why I Don’t Trust Free Markets

A lot of really smart people are huge proponents of free markets principles.  People a lot smarter than me.  I don’t pretend to understand economics, but here is why I’ve always been wary of free markets.  Realize that I’ve always felt this way and I’m not jumping on a theory when it’s really fucking down. 

I don’t trust free markets because I don’t trust people. 

When I say I don’t trust people, I don’t mean I just don’t trust corporate CEO”s.  I don’t trust Paul Krugman, Keith Olbermann, or any other liberal pundit much more.  To be honest, if I was running a major corporation I wouldn’t trust myself.  Power corrupts and it needs oversight.  This is why it is so important to have corporate boards who actually challenge the company.  Of course, most people that sit on these boards have been hand-picked by the CEO and make big bucks to do fucking nothing but be a rubber stamp. 

There are few people on this planet that I love to watch speak more than Thomas Friedman.  He’s bright, funny, and has a great energy to the way he presents things.  The way he advocates for his positions is really wonderful, but much of his earth is Flat model has been a really bad thing for this country.  While I’m not Lou Dobbs, I strongly believe that this country has sold itself down the river and we are about to go over a cliff that we will never climb out of.  You can’t expect to be the world’s biggest superpower when you manufacture practically nothing.  Hey Tom, I read your latest about what we should do to help the home crisis is allow more high tech brains from India to move here.  I understand your concept, but there aren’t enough good jobs anymore in even the IT field.  Now is not the time to try to push more immigration, even if they are smart people.

Speaking of smart people, the idea by many of the leading economists was that free markets would provide cheaper products and provide bigger profits for major corporations.  True, in the short term.  The problem was with us sending all of our major manufacturing jobs overseas, we now produce little and have very little to offer the rest of the world.  The idea that when a person who was working in a factory and making a decent wage should then retrain and do something in the technical is field is fucking stupid.  A lot of people just don’t have the aptitude for techie jobs. 

We have come up on the first time in the history of society where most men won’t being doing a job which provides any sweat equity.  Before the manufacturing age, men had a trade.  They were farmers or blacksmiths or lumberjacks.  Even the jobs in construction have been increasingly snapped up by illegal aliens.  Now many men who are guys that are hard-working, but not built to do high-tech type jobs (most of our population) have been left to work service industry jobs which pay shitty and leave them feeling desperate.  The only physically active job that there has been plenty of openings for is a military one.  Hmm, do you think that was a complete coincidence?

I don’t blame the politicians or corporate CEO’s solely, as the American people have blissfully let it happen.  We elect these opportunists.  We allowed these obscene moneygrubbers to line their pockets, while we still bought their products, even as they were destroying our manufacturing base.  With the availability of free credit, we could just charge our troubles away. 

I’m not someone who felt we should have been isolationists, but the idea that free markets would solve our problems was a terrible idea.  We needed oversight. We needed to give tax breaks to companies who kept jobs in this country and taxed the shit out of American companies who were sending jobs to other countries where they didn’t have to follow the same type of enviromental standards they had to follow here.  This isn’t protectionism, just fairness.  All these trade policies like NAFTA, etc. were great in the short-term, but have destroyed some part of our country in the long-term.  (meet the Industrial states of Michigan, Ohio, and Pennsylvania.)  Do you hear a giant sucking sound. I owe Ross Perot an apology.  (From his NAFTA debate over 15 years ago. )

PEROT: Well, everybody’s nibbling around the edges. Let’s go to the center of the bull’s-eye, the core problem. And believe me, everybody on the factory floor all over this country knows it. You implement that NAFTA, the Mexican trade agreement, where they pay people a dollar an hour, have no health care, no retirement, no pollution controls, et cetera, et cetera, et cetera, and you’re going to hear a giant sucking sound of jobs being pulled out of this country right at a time when we need the tax base to pay the debt and pay down the interest on the debt and get our house back in order.

We’ve got to proceed very carefully on that. See, there’s a lot I don’t understand. I do understand business. I do understand creating jobs. I do understand how to make things work. And I got a long history of doing that.

Now, if you want to go to the core problem that faces everybody in manufacturing in this country, it’s that agreement that’s about to be put into practice. It’s very simple. Everybody says it’ll create jobs. Yes, it’ll create bubble jobs.

Now, you know, watch this — listen very carefully to this. One-time surge while we build factories and ship machine tools and equipment down there. Then year after year for decades, they will have jobs. And I finally — I thought I didn’t understand it — called all the experts, and they said, oh, it’ll be disruptive for 12 to 15 years.

We haven’t got 12 days, folks. We cannot lose those jobs. They were eventually saying, Mexican jobs will eventually come to $7.50 an hour, ours will eventually go down to $7.50 an hour. Makes you feel real good to hear that, right?

Let’s think it through here. Let’s be careful. I’m for free trade philosophically, but I have studied these trade agreements till the world has gone flat, and we don’t have good trade agreements across the world.

I hope we’ll have a chance to get into that tonight, because I can get right to the center of the bull’s-eye and tell you why we’re losing whole industries in this country.

I wish I had a plan to get us back to a more balanced economic state, but I don’t have a clue.  I’m not a fan of people who just bring up past mistakes and don’t have a solution for the future, but I’ve got nothing.  We sold our soul for short-term gains and now we are all fucked.  I have no idea how fucked we are, but I’m not optimistic. 

2 thoughts on “Why I Don’t Trust Free Markets

  1. Very well said.

    It’s one of those insoluble rondelets that my brain gets on sometimes. Free trade benefits everyone. Except that the benefits accrue to the upper classes. Except that the lower classes lose manufacturing jobs. Except efficiency demands that manufacturing jobs be done for the lowest price. Except trade wars don’t work. Except the environment will suffer. Except, except, except.

    I don’t know the answers either. There are hard choices to be made here, and no one seems to be making them.

  2. I have many theories about economics, but I rarely share them because I figure if someone who really understands the subject will blow me out of the water. I understand that free markets should be the ultimate goal, but since the playing field is never close to level, we need to do things to create some balance.

    You are very right about no one making the truly hard choices. This has been the case for the past 8 years and despite Obama’s straight talk, the bailout plan doesn’t seem to reflect this tone. I have a feeling that soon, most of will be doing that though.

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