[quote=underdose]I challenge you to paint a realistic scenario in which the housing bubble would have occurred with actual free markets, absent the Fed’s loose money, the FDIC, and Fanny and Freddie providing an artificial secondary market.[/quote]
[quote=urbanrealtor]I challenge you to paint a large world-ranked economy that functioned on true free-market practice and had a functional democratic state.
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You failed to address my initial challenge. You merely deflected with a completely unrelated topic. That’s a cheap ploy and indicates you can not refute my points. Since you are effectively conceding that government regulation caused all our current woes, any attempts to condemn free markets for the sins of government intervention fall entirely flat.
Nevertheless, I will accept your counter challenge. There has never been a truly free market economy. It is an unattainable ideal. It requires strong limitations on the power of the government. The government, being made up of greedy, power hungry and often corrupt human beings, goes to great lengths to slander and undermine free markets. The false promise of socialism, “An all wise state will take care of everybody,” is very seductive. Too many people are not smart or informed enough to recognize the flaws in this promise (The state is not all wise but made of very fallible people. The state produces nothing and can not make good on the offer to provide without seizing by force from those who do produce. The offer to take care of while simultaneously forcibly taking from is a gross contradiction.) Those who buy into socialism are all too eager to abdicate power to the government. Therefore, so long as human nature is what it is, free markets are not attainable.
Should we abandon an ideal just because it is unattainable? Perfect health is unattainable. Should we just go kill ourselves then? Of course not. We strive to get as close to perfect health as we can. We push back against the constant onslaught of diseases. We should also push back against the constant attempts by government to usurp more power.
Even if free markets were attainable, would they work perfectly? Of course not. Nothing that involves people will ever work flawlessly. We have a spectacular knack of screwing things up. But knowing that, what’s the best we can achieve? What’s the least of all evils? What system would minimize the negative impact of people’s screw ups? A decentralized system fits that bill. A centralized power has unchecked ability to wreak unbounded destruction. Our founding fathers recognized that and devised a decentralized system of checks and balances. Is it flawless? Hell, it gave us 8 years of George W. Bush. But at least he left peacefully after 8 years instead of seizing power with an iron fist. Just because our system has its hiccups doesn’t mean we should abandon it in favor of totalitarianism.
There are no examples of free market economies. However, there are many examples of the alternatives, and they have yielded some horrible atrocities. The United Soviet Socialist Republic comes to mind, which gave us Stalin’s terror and eventually imploded in economic failure. This is not what we want! If we value freedom, we need to rediscover limitations on our government’s power. We should not hand them more rope with which to hang us.
