A market, by definition, is a mechanism to distribute goods and services. A free market is a market that is 100% efficient. That means that all possible information is known to all market participants and all goods and services are sold for their marginal cost.

In a perfectly free market, you would know, for example, what the marginal cost of a mocha grande at Starbucks is, and you would also know that Joe’s Coffee Shop sells a large mocha that is exactly the same as Starbucks, including the same quality. Starbucks would then have no choice but to sell you their mocha grande at the same price as Joe does, or go out of business.

In a free market, monopoly becomes impossible. In a free labor market, some of the examples you discuss become impossible.

Of course, a 100% efficient market is not possible. It may not even be desirable. But, the closer you can get to it, the less ability there is for large organizations, whether corporations or unions or bureaucracies, to distort the market to benefit themselves. As markets become less efficient, that is less information is available to the market participants and more distortion is in place due to regulation and monopoly, some market participants have to lose when others gain. As a market becomes more efficient, more participants gain and fewer lose.

Hopefully that helps clarify why free markets are good and regulated markets are bad.

There are some things that free markets are not good at (gasp, the horror, a free market liberal saying such a thing!). They don’t deal well with commons and they don’t deal well with externalities. It’s these areas where an outside force, such as government, is needed.

Now it seems to me the posts in this thread are literate and well informed. However not everyone is born equal and as someone remarked earlier in the thread .. for some people retraining or upskilling as the latest jargon would have it .. it would not benefit them.

Like it or not there is no going back .. there has to be a better way of ordering our affairs .. My first wife was a Finn and she took me around a papermaking factory .. The man who swept the floor and kept the aisles clean was proud to announce that his son was general manager of this very large plant.

What made this plant so different in my eyes was that it was a cooperative .. every single person had shares upon which they received a dividend at years end .. everybody held the same amount of shares. The wage scale was so arranged that the Managing Director or President as Americans call them received a maximum of 10 times the lowest wage in the plant. The pay differentials were stepped according to the degree of responsibility that each person carried.That company buzzed and literally shone with pride at their achievements in the market place ..

The economics of it all I later found in a paperback called ‘Small is Beautiful’ It was written by Dr E.F. Schumacher who was the chief economist for the British Coal Board at a time when it was the largest industry in Europe.

In it he described a company called the Bader Commonwealth (British) who dealt in paint and chemicals and they operated along the same lines .. the former owner and MD .. described his inner struggle as he tried to follow his friend and mentor Dr Schumacher .. I am sure we would all understand and sympathise.

There are six billion of us .. The Doha free trade talks have collapsed .. the answers to that are to be found in a book written by an American Banking Exec it was called ‘I was an Economic Hitman’ ..

An American General of Marines called Smedley Butler said “War is a Racket, I was no more than a high class hitman for big business” .. So as I have said there has to be a better way .. if not then we are doomed every last one of us.

Now I see that your Congress has ratified a bill to increase the minimum wage tied of course to a decrease in estate duty. At the end of the day the average Joe Blow has little more than the roof over his head for which he has paid 3 times the asking price over many years of repaying his mortgage .. Inflation has taken care of any of his so called gains .. its the same everywhere .. we are all yoked with usury .. there is no freedom there its an illusion ..

My understanding was that Patrick Henry was a pragmatic man .. his ideals are no longer attainable because of population pressures and demand for resources .. In todays world the only way to attain his ideal for America is for America to subjugate those areas that has the resources that she requires ..

So what about some liberty freedom and justice for everyone not a priviledged few .. I think it was an American who said “If we dont hang together, we will most assuredly hang individually”

Trade satisfies a mans deepest instinct because that is how his inner economy functions everything engages in fair trade with everything else .. the problem with Empire trade is that its based on usury and greed and enforced by a murderous military.

Now you may feel that I am off beam .. but think about it .. I hear Patrick Henrys bones a rattling

You might consider, when you discuss mercantilism, that the greatest advocate of free markets and capitalism, Adam Smith, was absolutely opposed to the mercantilism of the British Empire. What we practice now is modified mercantilism, usually referred to as corporatism. We do not have free market capitalism.

I’d be curious where the comparison of the British and French Empires’ practice of mercantilism and the free market came from?

I’m also curious how you respond to my three questions for you?

The only way to fix the problem is to take away government’s power to regulate.

Ecomonics is not a science. Its only a series of probabilities. Nash’s equations and graphs look simple, Ryan look at the real thing.

On top of that I’d like to add a thought. I’m a very mathematical person so I’m going to go through this the long way.
Given: I have a right to my property and thus the right to do whatever I want with it as long as I do not infringe on another person’s rights to life, liberty or property.
Given: I start my own business (my property) that does well, grows and eventually does so well it turns into a multi-billion dollar corporation.
What gives the government power to infringe on my right to property by telling me how to run my business?

Couple questions for you.

1. How do you know that we would all be poorer if we let the free market run its course? We never have, so we have no basis to make such a statement.

2. Those of us opposed to government regulation of the market are not, normally, opposed to unions per se. We are opposed to government support for, and regulation of, unions. Just as we are opposed to government support for, and regulation of, corporations.

3. Why do you, or anyone else, deserve special favor over and above any other person? It shouldn\’t matter whether I\’m white, black, brown, educated, uneducated, American, Somali, or any other differentiator that has no bearing on my character and capability. Why should any person be given special favor by government regulatory fiat?

Consider the effect of government intrusion on the market. There is a principle in the marketplace called economy of scale. Basically, it says that certain activities are much more efficient with much larger organizations; manufacturing cars, for example. It turns out that making money in a market that is heavily regulated by the government has an economy of scale factor occurring. Very large companies can afford the armies of attornies, regulatory experts and so forth to navigate those regulations, manipulate them and influence the government for more of them that a small company cannot. Unions can, and do, achieve the same economy of scale with government regulation. Government regulation is a boon to large corporations and unions. It contributes to higher prices, lower employment and worse working conditions.

I don\’t deny that, in most cases, the regulations are done for the best of reasons. However, the law of unintended consequences has played into the hands of the unscrupulous to create a corporate nation that squeezes the little guy out. If you want changes to benefit the little guy, one of the first is get the government out of the business of regulating every single facet of our lives. Or, shall I let another man speak for me?

\”It will be of little avail to the people, that the laws are made by men of their own choice, if the laws be so voluminous that they cannot be read, or so incoherent that they cannot be understood; if they be repealed or revised before they are promulgated, or undergo such incessant changes that no man, who knows what the law is today, can guess what it will be tomorrow. Law is defined to be a rule of action; but how can that be a rule, which is little known, and less fixed?\”
– James Madison
(1751-1836), Father of the Constitution for the USA, 4th US President
Source: Federalist Papers 62

In these circumstances, it would seem that this is coercive employment. You would risk be fired, because you want to better yourself and make up to .15 more an hour, 6 dollars a week. I sort of thought this was the similar to being assaulted. If you are beaten, you can ask the government to prosecute the perpetrator. If you can’t make a living, all you get is shrugged shoulders. It’s your own fault for working in those companies.

I can understand the arguments for less government, but lets not say that our society would be that much better. We really can’t anticipate what would happen in some instances. Our society is much different that before WWII. It also takes more sophistication to negotiate the obstacles in our world. There can only be so many push carts in the world.

1. It doesn’t work. The West is full of nations, including America, that have been trying that for centuries, look at the outcome.
2. The more regulation, the larger the political bureaucracy, the power the politicians, the more room there is for corruption.

Think about that for a while, then look at what we seek to change.

I was born a Celt in Britain and I feel sure that if we delved way back, we would find some common roots and bloodline. The Maori of New Zealand grant such people a place to stand and speak on the Marae. (The Meeting House)

As a specie we stand at a cross roads upon which our very survival depends. If America fails the Western World then I fear we must all go down together.

I said it before in an earlier post .. the system is not working! Usury as a system is not viable. There has to be a better way of ordering our affairs we do not need to keep repeating the bloody lessons of history.

God Help America! lets have some solidarity!