Tuesday, November 18, 2008

Al Gore and Coercion in the Free Market

"When greeting old friends after a period of absence, Ralph Waldo Emerson used to ask: 'What has become clear to you since we last met?'

"What is clear to us and many others is that market capitalism has arrived at a critical juncture. Even beyond the bailouts and recent volatility, the challenges of the climate crisis, water scarcity, income disparity, extreme poverty and disease must command our urgent attention.

"The financial crisis has reinforced our view that sustainable development will be the primary driver of economic and industrial change over the next 25 years. As a result, old patterns and assumptions are now being re-examined in an effort to find new ways to use the strengths of capitalism to address this reality. Indeed, at the Harvard Business School Centennial Global Business Summit held earlier this month, the future of market capitalism was one of the principal themes discussed."

What is very clear in Al Gore's mind is that market capitalism is engineered capitalism and has nothing to do with profit capitalists providing what the market--consumers--want. Rather, it has to do with what political engineers want. It is also very clear that the political engineering comes from the economic engineers who don't know laissez faire from socialism, men such as Henry Paulson and Allen Greenspan.

What form of oligarchy is this? It isn't the form of a democratic-republic, as our Founders invisioned, not when the majority of Americans demand that no bailout be contrived for the mortage industry yet our republic ignores the democratic wishes of free people who wish to remain free and contrive the bailout, anyway.
What form of psychological spin is Gore putting into our heads? Since when did capitalism need to be called market capitalism, and what other form is there, except the managed, mixed-economy we are now prisoners of?

Well, if by market capitalism Gore mean a market economy, he is way off base. A market economy cannot be politically engineered. It is "engineered" by the offerings of the producers in a relationship with consumers, who decide which produced offerings they will give their money to.

"A socialist economy, in contrast [to a market economy], is characterized by [ ] central planning. [G]overnment often is asked to intervene in the economy to correct situations in which the price system does not work. It regulates 'natural monopolies,' for example, and it uses antitrust laws to control or break up other business combinations..." [emphasis added] About.Com

"A 'natural monopoly' is defined in economics as an industry where the fixed cost of the capital goods is so high that it is not profitable for a second firm to enter and compete. There is a 'natural' reason for this industry being a monopoly, namely that the economies of scale require one, rather than several, firms. Small-scale ownership would be less efficient." http://www.progress.org/fold74.htm

"The great evil in economics is not communism, not socialism, not capitalism, not landlords or bosses, not unions, not feudalism or industrialization or automation, not progress or lack of it, and not any scarcity of natural resources. No, the great evil in economics is coercive monopoly." Fred E. Foldvary

But natural monopolies are not coercive. Communism and socialism and feudalism are coercive, and Gore's "market" capitalism is not capitalism because capitalism demands the admission that capital is property of its owner, not of the state. Only capitalists can create capital; government cannot. Gore and Obama treat capital as if it was a coercive monopoly, when in fact anyone can be a capitalist, and three quarters of all the business in this country is conducted by small business, not by natural monopolies nor by coercive monopolies such as first class mail deliverable only by the United States Postal Service.

Once again Gore gets it wrong when he may have valuable contributions to make. He does make people think, and that is a contribution; but he makes them think using the wrong terminology.

On National Public Radio International, I heard an "environmental artist" say--correctly--that we don't have global warming, that, instead, some places are warming, some are getting colder. Some places are getting hotter, and some are becoming wetter, some dryer. The Arctic may be melting, but Antarctica has 17 inches more ice than at any time since that continent's discovery, and from China to Colorado the winter of '07-'08 was the hardest on record. Lower temperatures had never been recorded in China; snow was still on the mountain peaks of Colorado in June. Fires in California, at an all-time high, are fanned by hurricane-strength Santa Anna winds.

The weather is changing, but you wouldn't get that simple message from Gore. And from his lips, and Obama's, to yours ears, you will never get the message that government intervention creates coercive markets, weighting down one part of it so that another must be offset by "redistributive" taxes, which then creates another anomoly in what ought to be a self-correcting market economy, but which has instead become a government-managed capitalism, masked by the word "market."

Government-managed capitalism is a contradiction of terms of the highest order; but to the degree that Marxists and other collectivists can get away with it, they can convince the economically illiterate that government controls are necessary.

And keeping people economically--and politically--illiterate is what the Fairness doctrine is all about, limiting free speech made by opponents of the left. Every Rush Limbaugh would necessarily, by law, be required to be followed by a Gore or an Allen Colmes.

And that would not be natural.

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