My debate with a anarchist on markets- fascinating

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Subprime JD's picture
Subprime JD
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My debate with a anarchist on markets- fascinating

Below are the main portions of a debate i had with a hardcore anarchist on the topic of markets and "free markets". My writings are in italics, his are below. Enjoy and comment freely.

Me:

For starters, you need to see the reason WHY people are starving in 3rd world countries, and not blame the free market.

AFRICA: Africa has been raped and pillaged by European empires for the last several centuries. Congo is a classic example. All the rubber was mined on the backs of the congolese people. When the people started to fight for independence the US via the CIA and State dept supported dictators to control the people and to keep raking in the profits. Europe was imperialistic and as a result of their imperialism they turned the guns on themselves and killed over 30 million people. Now did the free market do this, or was this the work of the government?? Hmmm.

IRAQ: Up to a million people died as a result of US imposed sanctions on Saddam Hussien, who used to be a US puppet himself. Thats what he got for dealing with the devil. Do you think the free market wanted these wars?? Wars benefit a select few, such as the industrial military complex (raytheon, boeing, united defense, Lockheed). Without gov prosecuting wars there would be NO market for weapons (at least not at the current scale). The free market wants to conduct trade, it wants to buy iraqi oil and sell them computers, cell phones, medicine, cars, donkeys, whatever.

INDIA: The people of India suffered due to the colonization of the British Empire. While the brits ruled, they ordered the indians to use all the water in the wells during the rainy season so that production could be increased. As the indians knew due to centuries of living there, water had to be stored for the dry season. With the british ruining this delicate infrastructure, millions of indians starved. Lets not forget about Indians socialistic endeavor which created one of the most corrupt govs on planet earth. So much red tape, you needed a permit to travel from province to province. Ever since the 90's indian has started market reforms and is curtialing the horrendous web of red tape. Wealth is rapidly increasing as people are able to work.

CONCLUSION: The only reason there is starvation today is because of government policy and intervention. Were the free market to operate, as it has always operated in the past, then very few would starve. Starvation is a fact of life in this world where dry seasons spell famine. But the free market can mitigate harmful effects. Because the price of food is suppressed in the US, EU, Japan, China due to farmer subsidies, there is less food grown each and every year. Farmers are abandoning their farms in droves. Gov subsidises food prices because special interests lobby for subsidies. Where there no state intervention in food prices, the food production would grow as there is always a MARKET for food. Learn your economics.

I would support full blown anarchy only if people were inherently good. But because people are inherently evil ,there must be some type of order. A limited order. This is what the US was founded on, a limited federal gov. Thats all gone now.

I do enjoy having my creative and physical energy being sold and bought as a cheap commodity. This world is not perfect.  If farmers dont farm then no one eats. If factory workers dont put cars together then no one drives. If funding is not available then loans arent created meaning many inventions wont be created. There has to be a medium of exchange. For 1000's of years it was gold now its fiat digitial currency. This soon will change, be it 10 yrs or 40yrs. The powers that be love the current system and will fight tooth and nail to maintain it. Because it is inherently flawed it will collapse. There is not enough money out there to pay off both interest and principal.

Even in the days of old there was a exchange. If i worked on my apple trees and they grew well, i would exchange them for some milk from the cow farmer. Yes, my sweat and creativity was sold for some milk. This is life. This is the reality of the world. Freeloaders never prosper and never have prospered

Oh and with regards to Greece my country will suffer. Standard & Poors just put Greece on negative watch and will probably downgrade Greek sovereign debt from -A to BBB. This means more taxes to pay more interest on the debt. With MORE taxes and gov intervention the private sector will get poorer meaning the people will become poorer. More work for less money. The downgrade partially attributed to the anarchist scum in Ecxarchia.

 Anarchist:

The contemporary condition of the human species is an infantile lack of power. We can't resolve violent differences without having some completely alien institution make our lives more difficult by jacking up the price of our existence -- and you openly advocate this? We can't legitimately (according to state law) acquire materials to fulfill our very real needs without having to first sell ourselves as commodities on the labor market -- and you openly advocate this? You say you're a "capitalist" and yet you openly admit you're just another low life wage laborer. You're not a capitalist. You have never been one and most likely will never be one. A capitalist has the ability to manage and freely circulate capital in order to produce large quantities of commodities that will be able to produce subsequently larger sums of Value on the global market. Capitalists do not have to exchange their labor power on the market for Value in order to survive - they live off of the surplus value produced by working class labor. You could probably pussyfoot around these claims with some more economist-speak, but that wouldn't disprove the critical analysis of the class relations that are integral to capitalism. (emphasis added)

Why should violent conflict between opposing parties be reduced to a factor of value-production on the global market? You see no problem with a very human activity (violence) - that will never go away - being used as an excuse to make people work even harder for an abstraction (exchange value)? Do you enjoy having your creative and physical energy sold and bought as a cheap commodity? Clearly you do, since you seem entirely incapable of questioning the relevance of the market itself in regards to human prosperity and well-being. You cry for the poor and yet you cheer for capitalism. How could there ever be such a thing as "the poor and downtrodden" in the absence of commodity relations? Isn't poverty, in a capitalistic context, merely a collateral factor in the inability of capitalism to meet human needs? Incomprehensibly large sums of basic necessities like clothes, food, etc, are produced through commodity labor and yet half the human population, maybe more, is malnourished and living in abject poverty. What, the market didn't roll the dice for them so it was just bad luck? They didn't work hard enough? Please... go push that economist superstition somewhere else, where people are actually dumb enough to swallow that horses***.

You're just a pissed off, self-righteous wannabe who is, in fact, a troller. You have no interest in intelligent discourse, only in provoking people into petty fits of name calling. Do yourself a favor, get off the damn internet, stop having your pitiful little temper tantrums, and go back to work. Your bosses are probably becoming impatient with your lack of productivity.

Your "free market" is just a convenient phantom. All of the things you postulated as having nothing to do with the the global commodity market (what else is the free market besides the 'free' exchange and distribution of commodities?) happened because of the free market. Why would Europeans have even bothered colonizing Africa and using African's as surplus labor, by means of chattel slavery, if it were not for the need to realize exchange value on the market through extracting raw resources and subsequently using them to produce commodities? What, are people of European descent just genetically predisposed to colonialism and racist ideology? Yours is a false critique. All it really amounts to is just populism. There is no shadowy cabal of elites controlling the world. The rule of the commodity is absolute and all state's serve it. European colonialism was driven by one thing: to accumulate vast sums of Value by means of exponentially multiplying the productivity of expansionist capital in European colonies. This would empower them militarily, culturally, economically (more laborers = more raw resources = more capital = more commodities = more chances to accumulate Value through the exchange of those commodities), and so forth.

"Where there no state intervention in food prices, the food production would grow as there is always a MARKET for food."

So people don't produce food to eat, they produce food for commerce? Why? Commerce is totally irrelevant to food production. People only need to produce as much food as they themselves need to eat. I don't care about your lame economics. It's just more crud that can be totally invalidated through sheer common sense.

"Do you think the free market wanted these wars?? Wars benefit a select few, such as the industrial military complex (raytheon, boeing, united defense, Lockheed)."

Yes. Wars benefit the market. The destruction of huge volumes of unnecessary capital and the subsequent hyper-drive in general productivity during the two world wars produced massive prosperity for the commodity market. How do you think the American ruling class came to accumulate such vast amounts of military, industrial, and social capital? Productivity increased by ten fold during both world wars. The commodities produced enabled the ruling class to accumulate huge sums of Value, which was, in turn, invested in more capital which produced more commodities, and so on and so forth. The same could be said for every successive war afterward. You like economic productivity, don't you?

The industrial military complex is an integral sector of capital and of the global commodity market. Ideologies and institutions used to coerce human populations into submitting to capitalistic relations are a fundamental part of this society. Without the monopolized violence of the state or other policing institutions, people would not work for wages or salaries, and the production of commodities would grind to a halt. The economy would collapse. The commodity market would fall into ruin.

"While the brits ruled, they ordered the indians to use all the water in the wells during the rainy season so that production could be increased."

Yes, more water enabled the Indian workers to work longer and harder, thereby increasing production, as you yourself point out. People could work more and thereby produce more "wealth" (as you call it -- otherwise known as capital) was produced. The commodity - the "free" - market came out on top. The state's power kept the working class in check. A couple sentences down you celebrate contemporary India's productivity: "Wealth is rapidly increasing as people are able to work."

It's incredible that you cannot see the connection here. So, what, you don't think contemporary India's productivity is driven by some semblance of the violence that was used to drive the productivity of British colonies? Good luck trying to prove otherwise.

"Where the free market to operate, as it has always operated in the past, then very few would starve... But the free market can mitigate harmful effects. Because the price of food is suppressed in the US, EU, Japan, China due to farmer subsidies, there is less food grown each and every year."

How can you not connect the dots and see that the commodification of food - a function of the "free market" - is the problem here? Food becomes an overproduced commodity, thereby leading to a devaluation of monetary exchange, and therefore people produce less of it? That violates every instinctual factor of the human species. We need food to survive, and yet, because of the commodity market we produce less of it because it fails to realize an acceptable amount of exchange value on the market. So much for logic and reason... (emphasis added)

"I would support full blown anarchy only if people were inherently good. But because people are inherently fucked up, there must be some type of order."

Of course, you never substantiate this claim. I'm sure you'll try to now, but you'll only be able to do so through fantastical references to religious mythology and/or poorly thought out metaphysical rhetoric.

"There has to be a medium of exchange. For 1000's of years it was gold now its fiat digitial currency. This soon will change, be it 10 yrs or 40yrs."

No, there doesn't. And making ill thought out references to some convenient historical narrative is not a logical or reasonable means to substantiate that claim. "1000's of years" is just a snapshot of a couple millions of years of human existence. Exchange value has no relevance to human life outside of commodity relations or class society - both of which are fairly recent inventions. People can get on just fine with direct, unmediated access to material wealth and the means of produc(ing more material wealth)tion. Having to accumulate a specific amount of some abstract value - which is only expressed when commodities are bought and sold - in order to secure commodified necessities and whatnot is completely anti-human (i.e., misanthropic) as it arbitrarily and violently impedes the fulfillment of human needs.

 

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Gungnir
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Re: My debate with a anarchist on markets- fascinating

I suspect that said anarchist would, if the US collapsed into anarchy, be outside rejoicing; when the Bloods came around the corner and injected some lead into his brain. Not that this would likely change his mental capacities in any way.

I hate people who purport to be anarchists.

Subprime JD's picture
Subprime JD
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Re: My debate with a anarchist on markets- fascinating

Some of the things they argue are interesting but they offer absolutely no viable alternative. To honestly believe that the world could exist without markets is so naive it blows my mind. Its strange how they confuse the market with all the destruction that has occured in the past 2 centuries. They dont understand that the market has always been there, its just that now it is more complex and interconnected then it has ever been before.

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Re: My debate with a anarchist on markets- fascinating

Gungnir said,

Quote:

I hate people who purport to be anarchists

It's adolescent.
Anarchy is not a state of existence, it's a transitory period between states of existence.

To espouse the benefits of such a system is to reveal a lot about one's true character; opportunism, love of violence and lack of respect for civil decency.

To be blunt, anyone who "claims" they're an anarchist is so because they're too naive to realize that their chances of survival in such a situation are low. Hurricane Katrina was Anarchy. The opportunists went on unchecked because the disaster was relatively short duration. Had supply trucks and C130's not piped in supplies, police and troops, those same opportunists would have likely been ransacked by more powerful gangs once Feudalism set in to replace the Anarchy.

Cheers!

Aaron

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Re: My debate with a anarchist on markets- fascinating

Well it certainly wasn’t “My Dinner with Andre” but it was a good read. To me this goes in the category of Karl Marx’s work, namely, the conclusion that he was wrong about communism but right about capitalism. I’m not an anarchist, and make no attempt to support or justify that position, but in the arguments regarding free markets I sure don’t hear any relevant rebuttal. That said, the alternative (or lack of) as presented by anarchy is not appealing either.

 

The roll up for me is that we are comparing an existing system, with all its (substantial) flaws and foibles, with a proposed system that is largely theoretical. I’m just not sure that this type of comparison is meaningful as much more detail is available for criticism of the existing system because of the simple fact that is real and can be scrutinized. This is not possible for many, if not most of the alternates proposed on this and other sites. To some extent, you have to weight and value more heavily a system that is real with known flaws against one that is purely theoretical. You don’t know what you don’t know.

 

I don’t feel that bringing in an example of a natural disaster is a fair analog to illustrate the performance potential of a system such as anarchy, after all, by definition it is a disaster. The same comment can be made pre-emptively about warlords and roving gang violence in Somalia and other places-not a fair comparison of a premeditated political system that purports to be free of government intervention and by extension violence.

 

The value in this discourse to me however is not the positioning or discussion of anarchy as a meaningful alternate, it is in the perspective and critique of the free market system which appear to foster such fondness. The arguments presented by the anarchist are not without flaws, but largely I find them pretty compelling and at the same time disturbing as to the implications if correct. I also find there to be more than a little schizophrenia around the subject of free markets, especially on this site.  Perhaps I have not been around here long enough to appreciate the subtleties of the culture, but it seems to me that the basic premise here is the rejection of our current system as yet another example of a free market system that has failed. The central theme is that the markets are being manipulated for the benefit of a plutocracy, and that the ravages of corporatism are both directly and indirectly responsible for the exploitation of oil and other natural resources to the point of unsustainability.

 

So in light of these themes, and the very real observable results from the last financial debacle, what, are we going to argue that what we really need is yet another unregulated free market system? Really?

 

Clearly, some type of regulation or oversight is needed to stave off the effects that are cited by both debaters, this seems to be a rather obvious point. It is really hard for me to see how intelligent people could conclude otherwise. So what happens if you add regulation to a society constructed as an agorist or anarchy structure?  It’s now got government-so you invalidate the definition of anarchy. So what happens if you add (heavy) regulation to a society constructed as a free market system-well, it’s no longer a free market now is it?

 

It seems to me that to some degree, both of these extremes rely on self regulation-some might say entropy- as the defining construct. It should be abundantly clear that neither philosophy is practical.

 

I think it can be shown that in a “free market” there really are only two outcomes, one, you provide meaningful and strict regulation to prevent capitalists from behaving the way capitalists are predisposed to behave and thereby capturing the benefits of capitalism without as much of the ugliness as humanly possible, or, you don’t regulate, which is to say you capitulate the control and direction of the rules to those that stand to gain the most.

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Re: My debate with a anarchist on markets- fascinating

"The very real observable results from the last financial debacle"   

A man named Karl Marx may have said the same thing when describing what he saw in the days of the Industrial Revolution, but he was by no means alone in this.

Marx saw that, before the Industrial Revolution in approximately the late eighteenth century,  there were no regularly recurring booms and depressions.  There would be a sudden economic crisis whenever some king made war or confiscated property of his subject; but there was no sign of the peculiarly modern phenomena of general and fairly regular swings in business fortunes, of expansions and contractions.  Since these cycles also appeared on the scene at about the same time as modern industry,  Marx concluded that business cycles were an inherent feature of the capitalist market economy.  All the various current schools of economic thought , regardless of their other differences and the different causes that they attribute to the cycle, agree on this vital point.

That these business cycles originate somewhere deep within the free-market economy.  The market economy is to blame.  Karl Marx believed that the periodic depressions would get worse and worse, until the masses would be moved to revolt and destroy the system,  while the modern economists believe that the government can successfully stabilize depressions and the cycle.  But all parties agree that the fault lies deep within the market economy and that if anything can save the day,   it must be some form of massive government intervention.

Fortunately, a correct theory of depresssion and of the business cycle does exist, even though it is universally neglected in present-day economics.  It too,  has a long tradition in economic thought.

This theory began with the eighteenth century Scottish philosopher and economist David Hume, and with the eminent early nineteenth century English classical economist David Ricardo.  Essentially, these theorists saw that another crucial institution had developed in the mid-eighteenth century, alongside the industrial system.     This was the institution of banking, with its capacity to expand credit and the money supply   (first, in the form of paper money, or bank notes, and later in the form of demand deposits, or checking accounts, that are instantly redeemable in cash at the banks).   

  It was the operations of these commercial banks which, these economists saw, held the key to the mysterious recurrent cycles of expansion and contraction, of boom and bust, that had puzzled observers since the mid-eighteenth century.  (from M.Rothbard)

http://mises.org/story/3127

Lending money has been around for ages but it was the lenders own money.   Lending other peoples money and credit expansion as "banking practice" developed in England.      And later brought to the New World.

 

 

 

 

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Re: My debate with a anarchist on markets- fascinating

Your "free market" is just a convenient phantom. All of the things you postulated as having nothing to do with the the global commodity market (what else is the free market besides the 'free' exchange and distribution of commodities?) happened because of the free market. Why would Europeans have even bothered colonizing Africa and using African's as surplus labor, by means of chattel slavery, if it were not for the need to realize exchange value on the market through extracting raw resources and subsequently using them to produce commodities? What, are people of European descent just genetically predisposed to colonialism and racist ideology? Yours is a false critique. All it really amounts to is just populism. There is no shadowy cabal of elites controlling the world. The rule of the commodity is absolute and all state's serve it. European colonialism was driven by one thing: to accumulate vast sums of Value by means of exponentially multiplying the productivity of expansionist capital in European colonies. This would empower them militarily, culturally, economically (more laborers = more raw resources = more capital = more commodities = more chances to accumulate Value through the exchange of those commodities), and so forth.

This is the area where anarchists and free market adherents disagree on most.  They believe that the "market" itself is the harm, and that the state supports the market with violence and law. A's claim that without the "market" there would be no reason for people to seek more value by invading/colonizing other areas. The assumption that we can have a world without a market is severely flawed. There is always a market, always and at all times. Humans attach value to everything and they always have. Even in the caveman era there was value, thus, some form of a market. If a clan of neanderthals were had access to a water source, and then a bigger clan came along and wanted the water, they either shared or had a war. If there wasnt enough water to go around for everyone the bigger clan would wipe out the smaller one. Was there not a value attached to the water source? Thus, a market had been set up for the water, and the price was battle/death.

The same applies to the iron age with the mesopotamians. Some people settled along the Euphrates and raise crops through irrigation. If another clan came to the same area and wanted to farm but there wasnt enough to go around a battle ensued. If there isnt a sufficient surplus of energy then the rule of the commodity is absolute and the state/clan/group must serve it or they will die. In modern society there is enough of the commodity to go around so violence is subdued. Post Katrina was a classic example of the lack of the commodity so peoples needs for the commodity became more pronounced. The market, allows for the commodity to have a value, and where there is a value attributed to a commodity then there is order in the commodity. With no market and thus no order, people assign whatever value they wish on the commodity and chaos reigns. The market thus is order on the commodity.

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Re: My debate with a anarchist on markets- fascinating
bearmarkettrader wrote:

 

 With no market and thus no order

Market is not synonymous with order. Markets can be ordered or disordered. The fact that there is constant call for regulation of markets, for example 'green taxes', the Office of Fair Trading and import taxes, proves that so called 'free' markets do not always produce social 'goods'. The outcomes of an unfettered market economy are not always benign and it is patently false to claim so.

Here is an example of an ordered ecnomic model which does away with markets, it is called Parecon (Micheal Albert) which is short for Participatory economics. It is very well thought out, and is close to socialism and anarchism in many ways. It is  certainly not capitalist. This page compares parecon and capitalism, and for those interested there is a wealth of info there if you explore:

http://www.zcommunications.org/zparecon/capvsparown.htm

This is another idea which does away with markets on a more personal, practicle, everyday level:

www.justfortheloveofit.org

The claim that anarchists are simply naive is lazy cognition. It also shows lazy cognition when the workers in a capitalist society claim they are either capitalists or pro-capitalism. It is a credit to the effictiveness of the propaganda of the capitalist classes who own your labour and get fat off its surpluses.

It is the same fear-trigger used every time: "Anarchy = chaos: Be afraid!" I would say that it is very naieve to simply swallow this nugget of 'conventional wisdom' and regurgitate it on queue whenever the word anarchy is brought up in conversation. I would suggest taking a good look at the arguments and removing oneself from the knee-jerk emotional reaction which is embedded in us by our family/peers/telivision/politicians and really try to grasp the spirit of anarchy. It may be, however, too hard to look at oneself in the mirror and discover that you, your parents and your children are all Workers on slave wages in a tyrannical capitalist dictatorship which is robbing us of our humanity.

 

peace y'all

Crash

 

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Re: My debate with a anarchist on markets- fascinating
BearMarketTrader wrote:

The same applies to the iron age with the mesopotamians. Some people settled along the Euphrates and raise crops through irrigation. If another clan came to the same area and wanted to farm but there wasnt enough to go around a battle ensued. If there isnt a sufficient surplus of energy then the rule of the commodity is absolute and the state/clan/group must serve it or they will die. In modern society there is enough of the commodity to go around so violence is subdued. Post Katrina was a classic example of the lack of the commodity so peoples needs for the commodity became more pronounced. The market, allows for the commodity to have a value, and where there is a value attributed to a commodity then there is order in the commodity. With no market and thus no order, people assign whatever value they wish on the commodity and chaos reigns. The market thus is order on the commodity.

This hits the nail squarely on the head, regardless of what others have said a needed commodity is a needed commodity, there are mechanisms you can use to procure that commodity, you can produce it, you can trade for it, or you can take it. Within the current system, there are restrictions on taking it, that make it higher risk than either producing it, or trading for it. However the restrictions are centralized, which is the antithesis of anarchy.

For example, lets look at feudal Europe, excises and tariffs were decided on entry to a city based on an arbitrary assessment of the value, and what was defined as taxable, which might vary according to current local conditions and considerations. Refusal to pay could lead to imprisonment or confiscation, obviously not an equitable situation. This was a feudal system and one step removed from anarchy, where there is absolutely no consistency, at least with the Feudal system you had an idea that you were going to be screwed.

Lets extrapolate to modern times, you drive your car from community A to community B, community A has no tariffs on motor vehicles, but community B does, and requires 50% of the value of the vehicle to be paid on entry. How would you know that before arriving? Isn't that basically highway robbery? So you turn around, but not so fast, you still need to pay because you are on community B's property, you don't have 50% of the value of the vehicle so it's confiscated, now you're 100 miles from home with a set of rules you need to follow that you have no idea about. That doesn't seem like an effective system for comfortable living let alone a free market. So who will prevent this from happening with no central government. Even if local communities are cooperative and have a consitently applied set of laws, then at some point you'll hit that community boundary and be in the same situation.

Overall Aaron is quite accurate, by definition "Anarchy" is unsustainable for the reasons listed above, even then once you have an established community it's no longer anarchy in the true sense, because it's organized and has a centralized (to a small degree) government even if its a cooperative. For instance take Freetown Christiania in Copenhagen, an "anarchist" community that does not allow "hard drugs", guns, violence, knives, bulletproof vests, stealing, cars, cameras, bikers colors and building without community approval. So according to the definition of Anarchy 

  1. "No rulership or enforced authority."
  2. "Absence of government; a state of lawlessness due to the absence or inefficiency of the supreme power; political disorder."
  3. "A social state in which there is no governing person or group of people, but each individual has absolute liberty (without the implication of disorder)."
  4. "Absence or non-recognition of authority and order in any given sphere."

It can't really be considered one. Since definition 3 is contravened in Freetown Christiania it also obviously has a community government even if everyone participates, enforced authority, and recognizes authority and order. It also has a history of violent acts being committed by or on the community One final point to mention is that without social security, and external commerce Freetown Christiania would have minimal income that was not directly attibutable to the drug trade (even now with no open selling of soft drugs).

 Ultimately Anarchy is the disenfranchised teens idea of heaven, and should it ever come to pass then these people would be the first to be eliminated from the gene pool, because they don't actually get that in most cases the restraint of people from committing violent acts is either the threat of defensive violence, or centralized authority.

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Re: My debate with a anarchist on markets- fascinating
darbikrash wrote:

 

... Perhaps I have not been around here long enough to appreciate the subtleties of the culture, but it seems to me that the basic premise here is the rejection of our current system as yet another example of a free market system that has failed. The central theme is that the markets are being manipulated for the benefit of a plutocracy, and that the ravages of corporatism are both directly and indirectly responsible for the exploitation of oil and other natural resources to the point of unsustainability.

I think that's a reasonable assessment. You've got us pegged. I would say most of us think our biggest problems can be traced to the fact that the government has been largely captured by special interests, led by the corporations - with the distinction being, those of us coming from the left tend to focus on blaming the corporations for hijacking the government, while those of us coming from the right (mostly libertarian) tend to blame the government for allowing itself to be hijacked. I happen to side with the latter. Which means, if I'm right, we have ourselves (and our ancestors) to blame. I think what we're experiencing is not a failure of the free market (as it is not at all free) but really a failure of democracy. Just as de Tocqueville, Jefferson, and others worried, centuries ago, 'we the people' gradually allowed the government to be taken over by special interests. http://pmcms.socialsecurityinstitute.com/news/essays/totalitarianism-in-democracy-tyranny-by-committee/

Quote:

So in light of these themes, and the very real observable results from the last financial debacle, what, are we going to argue that what we really need is yet another unregulated free market system? Really?

We did not have an "unregulated free market system" in the first place. It only appears that way because the regulation was (and still is) completely imbalanced. The whole concept of fiat debt money (which is at the root of everything, and which is opposed by almost all of us on this site) is entirely dependent on the government for it's existence. Combined with the central bank (in our case, the Fed, of course) with it's monopoly control over interest rates, and which also owes it's existence to the government, this is the mother of all regulation. A market based on such a system simply cannot be reasonably regarded as free. And then of course, fractional reserve banking which has it's origins in pure fraud, owes it's unbridled proliferation to government legalization and sanction, thanks also to regulatory capture. http://www.freemensch.com/2009/02/198-years-of-legalized-fraud.html Without the government, fractional reserve banking might still exist in a more limited capacity, but there would be no 'too big to fail' banks.

So, with investment banks leveraging at 30 or 40 to 1 ratios, and the Fed infusing more and more money (legally conjured out of thin air) into the system to feed the bubble, should credit default swaps have been regulated? ... OF COURSE!!! ... That's what I mean by "imbalanced." It was insane not to. The government created enormous moral hazard while doing nothing to protect against the inevitable consequences. But to say that the free market failed, is like saying a patient on a blood thinner, who bled to death, died because they received no medicine. And that's a pretty fair analogy to government, in my opinion, because government always prescribes medicine (more government) for every problem, almost never addressing the root cause (that might limit the need for government, after all), and without regard for the possible side effects. And if the problem isn't fixed (which it usually isn't) they just give more medicine, and then inevitably, a new medicine to deal with the unintended (or intended) side effects caused by the first one. And so on - until the patient is on life support.

Quote:

Clearly, some type of regulation or oversight is needed to stave off the effects that are cited by both debaters, this seems to be a rather obvious point. It is really hard for me to see how intelligent people could conclude otherwise.  ...

We can debate the intelligent part, I guess, but I do conclude otherwise. Just as I don't think more debt is the cure for too much debt, I don't think more government is the cure for too much government. And in my view, the government has been pretty well fully captured, making the task of fixing our problems even more difficult. How do you fix a corrupt, dysfunctional government? There are no easy answers. But putting the fox in charge of the hen house is not going to help. I'm sure of that.

Cheers

Greg

 

Subprime JD's picture
Subprime JD
Status: Platinum Member (Offline)
Joined: Feb 17 2009
Posts: 562
Re: My debate with a anarchist on markets- fascinating

Crash said:

It is the same fear-trigger used every time: "Anarchy = chaos: Be afraid!" I would say that it is very naieve to simply swallow this nugget of 'conventional wisdom' and regurgitate it on queue whenever the word anarchy is brought up in conversation. I would suggest taking a good look at the arguments and removing oneself from the knee-jerk emotional reaction which is embedded in us by our family/peers/telivision/politicians and really try to grasp the spirit of anarchy. It may be, however, too hard to look at oneself in the mirror and discover that you, your parents and your children are all Workers on slave wages in a tyrannical capitalist dictatorship which is robbing us of our humanity.

 

 

The slave wage argument is a common argument used by anarchists to critisize the capitalist model. They also argue that capitalism creates a class of capitalists and non-capitalists (aka slaves). This argument is faulty because it assumes that the class structure is static and not fluid. People fall through the class structure all the time. Millions of capitalists (those with wealth) go bankrupt due to mistakes in business, competition, emotional reasons, or just plain quitting. Look at how many mortgage brokers, bankers, restauranteer, car dealership owners with ch 7 in the past 2 years. Pure capitalism rewards success and punishes failure. The punishment is bankruptcy of the company. With the BK, the assets are bought by more productive owners and thus serve a benefit to the society. Competition is key to progress, for without competition, the economy contracts leading to more poverty. Take a look at the USSR to see what the lack of competition did to its industry.

Also, it is incorrect to label wage workers as slaves. Wage workers live very good lives if they save and carefully manage their money. Look at the last century at how well wage workers have prospered (the last 15 yrs the US has been in economic decline due to central economic planning). Also, executives and owners of the companies stress much much more then the workers do. The worker does his 9-5, 9-7, goes home and relaxes. The owner is always worried, in good times and bad. The owner has to worry about the gov raising taxes, the owner worries about competitors offering better products for lower prices. The owner has to worry about INSOLVENCY. Because of the owners stress and 24-7 hour work (he dreams of the company) the worker is happier as he can rely on the owner to ensure the company will survive. So yes, the owner reaps the profits of the company, but as biggie smalls once said "more money, more problems". Never underestimate the stress of being an owner.  

GregSchleich's picture
GregSchleich
Status: Silver Member (Offline)
Joined: Jan 16 2009
Posts: 187
Re: My debate with a anarchist on markets- fascinating

Crash

I'm from the libertarian school that goes by the Thomas Paine credo, "that government is best which governs least." So, although BearMarketTrader and I probably have a fair amount in common, too, I'm actually quite sympathetic to Anarchist thinking. My issue is freedom. And so I share the popular anarchist view that government is coercion, government is force, or even government is violence (as some of the more melodramatic folks prefer to say - not entirely unreasonably). Of course it is the anarcho-capitalist version which comports much more closely with my views, but I also prefer it to anarcho-socialism because I regard it as freer and more pure - it would allow anarcho-socialism to coexist, while the opposite cannot be said.

But the crux of the issue, I guess, comes down to property rights. I think the debate about what should be commons, and how much should be commons, is a very valid and important one. Certainly, I believe, private property rights need to be carefully balanced against the harm of monopoly, especially water, arable land, and indispensable resources. This is a discussion I welcome. But the utopian collectivist notion that we should have no individual property rights, I'm instinctively and intellectually convinced, simply runs counter to human nature. Lockean principles are called 'natural rights' for good reason. They preexist and preempt government or any other artificial construct mankind may chose to devise. Just as animals naturally claim territory, and even migratory birds return to the same nesting sites, humans have the same instinct. It's pointless to try to defeat that.  

Crash wrote:

Market is not synonymous with order. Markets can be ordered or disordered. The fact that there is constant call for regulation of markets, for example 'green taxes', the Office of Fair Trading and import taxes, proves that so called 'free' markets do not always produce social 'goods'. The outcomes of an unfettered market economy are not always benign and it is patently false to claim so.

Nothing involving humans is perfect, including markets. Certainly they can fail to account for externalities like pollution or the consequences of depletion, as in the case of fossil fuels. But while some sort of regulation or intervention may well be necessary or beneficial in some cases, overwhelmingly government has a record of distorting markets, and worsening problems rather than mitigating them. And even when government is effective, it is often remedying a problem it created in the first place. Corporations, some of which have now become multi-national Frankensteins, after all, are government creations. Originally, they were supposed to serve the public good, hard as that is to believe now. But that all changed with regulatory capture in the 19th century. Without massive government giveaways and monopoly licensing, along with legalized fraud - fractional reserve banking - could the robber barons have achieved their obscene wealth? Without the steroidal impact of central bank driven fiat debt money in the 20th century, which eventually facilitated growth for the sake of growth, could we have ravaged the landscape and plowed our way through so many resources with such astonishing rapidity?

Quote:

Here is an example of an ordered ecnomic model which does away with markets, it is called Parecon (Micheal Albert) which is short for Participatory economics. It is very well thought out, and is close to socialism and anarchism in many ways. It is  certainly not capitalist. This page compares parecon and capitalism, and for those interested there is a wealth of info there if you explore:

http://www.zcommunications.org/zparecon/capvsparown.htm

I checked it out. No thanks. Collectivism is perfectly fine, and even desirable on a voluntary and situational basis, but to impose this universally on everyone is absolute tyranny. It has been tried repeatedly, always with the same disastrous results - Stalin, Mao, Pol Pot. No thank you.

Quote:

... It may be, however, too hard to look at oneself in the mirror and discover that you, your parents and your children are all Workers on slave wages in a tyrannical capitalist dictatorship which is robbing us of our humanity.

I don't completely disagree with this view. But I don't think the dystopian scenario you're describing, and that we're living in in many ways, is a free market at all. We live in a world of state capitalism - or corporatism, run by a corporate plutocracy in which elite finance is firmly ensconced at the top of the pyramid. And so in my view, there are two extremely salient points Marxists, or  collectivists of any kind need to grasp. 1) We are not really wage slaves. We are debt slaves. 2) Overwhelmingly, the "means of production" over which an unconscionably small group of people have a monopoly is financial capital. It's very simple. We allowed the banking industry to take control of all money creation, and with it, control of us. And they have devised the most insidious and powerful method possible - the creation of all money from debt, with interest. That's what has to change. And someday it will.

Peace

Greg 

 

goes211's picture
goes211
Status: Diamond Member (Offline)
Joined: Aug 18 2008
Posts: 1114
Re: My debate with a anarchist on markets- fascinating

Crash

I'm from the libertarian school that goes by the Thomas Paine credo, "that government is best which governs least." ...

Greg,

Excellent post!  I was considering how to respond to Crash but you just did a better job than I would have.

 

Crash's picture
Crash
Status: Silver Member (Offline)
Joined: Nov 26 2008
Posts: 171
Re: My debate with a anarchist on markets- fascinating

Hi Greg,

 

thanks for your considered response. I was just sticking my oar in!

I must have given you a less than great example of a good page on Parecon. It is very far from Stalin, Mao or Pol Pot who were all dictators indeed.

Parecon is a deeply democratic ideal and there are examples of some institutions and companies working under these principles as much as they can in a capitalist society.

This page gives a much better feel for what parecon is:

http://www.zmag.org/znet/viewArticle/3978

here is a quote from it:

"The central features of the model called parecon are workers and consumers self managed councils, balanced job complexes, remuneration for duration, intensity, and onerousness of socially valued labor, and participatory planning."

I don't completely disagree with your view either, I like the bit where you say:

"But I don't think the dystopian scenario you're describing, and that we're living in in many ways, is a free market at all. We live in a world of state capitalism - or corporatism, run by a corporate plutocracy in which elite finance is firmly ensconced at the top of the pyramid. And so in my view, there are two extremely salient points Marxists, or  collectivists of any kind need to grasp. 1) We are not really wage slaves. We are debt slaves. 2) Overwhelmingly, the "means of production" over which an unconscionably small group of people have a monopoly is financial capital. It's very simple. We allowed the banking industry to take control of all money creation, and with it, control of us. And they have devised the most insidious and powerful method possible - the creation of all money from debt, with interest. That's what has to change. And someday it will."

I'd just finish by saying that the reason I am against capitalism is because it is an inherently divisive system and there are better ways of managing our lives.

hugs,

Crash X

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