Strong Free-Market Ideology

A Strong Free-Market Ideology is a free market ideology that is a Fundamentalist Ideology (in free markets).

• AKA: Orthodox Libertarian Economic Belief System.
• Context:
  • It can be held by a Free Market Fundamentalist.
  • It can (typically) discount Negative Externalities.
  • It can (often) demand that anyone who holds contrary views is not a real Economist.
• Example(s):
  • Neoliberalism.
  • …
• Counter-Example(s):
  • a Marxist Ideology.
  • a Weak Free Market Ideology.
• See: Laissez-Faire, Economic Interventionism, Mixed Economy, Protectionism, Milton Friedman.

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References

2014

• (Wikipedia, 2014) ⇒ http://en.wikipedia.org/wiki/market_fundamentalism Retrieved:2014-8-3.
  • Market fundamentalism (also known as free market fundamentalism) is a pejorative term applied to a strong belief in the ability of laissez-faire or free market policies to solve most economic and social problems.

    Critics of laissez-faire policies have used the term to denote what they perceive as a misguided belief, or deliberate deception, that free markets provide the greatest possible equity and prosperity, and that any interference with the market process decreases social well being. Users of the term include adherents of interventionist, mixed economy and protectionist positions, as well as billionaires such as George Soros, and economists such as Nobel Laureates Joseph Stiglitz and Paul Krugman. Critics cite as fundamentalist the unshakable belief, despite contrary evidence, that unfettered markets maximize individual freedom, that they are the best means to economic growth and that society should adhere to their ideas of progress. Ideas ascribed to fundamentalists include the belief that markets tend towards a natural equilibrium, and that the best interests in a given society are achieved by allowing its participants to pursue their own financial self-interest with little or no restraint or regulatory oversight. Critics claim that in modern society with world-wide conglomerates, or even merely large companies, the individual has no protection against fraud nor harm caused by products that maximize income by imposing externalities on the individual consumer as well as society. According to economist John Quiggin, the standard features of "economic fundamentalist rhetoric" are "dogmatic" assertions and the claim that anyone who holds contrary views is not a real economist. John Ralston Saul claims this is simply a form of bullying. This approach follows from evidence that neoclassical economics provides a scientific explanation of economic phenomena, an explanation that economists state represents the status of scientific truth (if, and only if, all of the assumptions involved in deriving the economic analysis are simultaneously satisfied). However, Kozul-Wright states in his book The Resistible Rise of Market Fundamentalism that "ineluctability of market forces" neo-liberals and conservative politicians tend to stress, and their confidence on a chosen policy, rest on a "mixture of implicit and hidden assumptions, myths about the history of their own countries' economic development, and special interests camouflaged in their rhetoric of general good".

• (Wikipedia, 2014) ⇒ http://en.wikipedia.org/wiki/fundamentalism#Non-religious Retrieved:2014-8-3.
  • Some pejoratively refer to any philosophy which they see as literal-minded or they believe carries a pretense of being the sole source of objective truth as fundamentalist ...

    ... The term "fundamentalism" is sometimes applied to signify a counter-cultural fidelity to a principle or set of principles, as in the pejorative term “market fundamentalism” applied to an exaggerated religious-like faith in the ability of unfettered laissez-faire or free market economic views or policies to solve economic and social problems. According to economist John Quiggin, the standard features of "economic fundamentalist rhetoric" are "dogmatic" assertions and the claim that anyone who holds contrary views is not a real economist. Retired professor in religious studies Roderick Hindery first lists positive qualities attributed to political, economic, or other forms of cultural fundamentalism. They include "vitality, enthusiasm, willingness to back up words with actions, and the avoidance of facile compromise." Then, negative aspects are analyzed, such as psychological attitudes, occasionally elitist and pessimistic perspectives, and in some cases literalism.

2010

• (Oreskes & Conway, 2010) ⇒ Naomi Oreskes, and Erik M. Conway. (2010). “Merchants of Doubt: How a Handful of Scientists Obscured the Truth on Issues from Tobacco Smoke to Global Warming." Bloomsbury Publishing USA.
  • QUOTE: The billionaire investor George Soros has coined a term to describe this perspective: “free market fundamentalism.” It is the belief not simply that free markets are the best way to run an economic system, but that free markets are the only way that will not ultimately destroy our other freedoms. “The doctrine of laissez-faire capitalism holds that the common good is best served by the uninhibited pursuit of self-interest,”[36] Soros wrote. Like its bête noire, Marxism, laissez-faire economics claimed to be scientific, based upon immutable laws of nature, and also like Marxism, it has not stood the test of experience. If it were a scientific theory, it would have long ago been rejected.[37] Free-market fundamentalism is an article of faith.

    “Scientific Socialism” wasn’t scientific because when evidence suggested that some of its central claims might be wrong, its advocates refused to accept that; for the same reason, free market fundamentalism isn’t scientific, either. The basic tenet of laissez-faire, that “free and competitive markets bring supply and demand into equilibrium and thereby ensure the best allocation of resources,” is an axiom that turns out not to be true.[38] Prices can be displaced from their “equilibrium ideal” for long periods of time, as any American impacted by the ongoing housing market collapse can attest.

    Even Milton Friedman acknowledged that there may be external costs that markets fail to account for — and pollution is the clearest example. Regulation is needed to address external costs, either by preventing them or by compensating those who are saddled with them.

     Friedman was a true believer in the market — he thought that external costs were rarely high enough to justify government intervention. But most of us want our governments to protect us from harm in many, diverse ways. We want police and firefighters to protect our homes; we want to make sure that our food supply is not contaminated and the water that comes out of our tap is clean; we want to know that drugs we buy at the pharmacy won’t kill us. And in recent months, we’ve come to see the consequences of insufficient regulation of financial markets.

    Moreover, the idea that free markets produce optimum allocation of resources depends on participants having perfect information. But one of several ironies of our story is that our protagonists did everything in their power to ensure that the American people did not have good (much less perfect) information on crucial issues. Our protagonists, while ostensibly defending free markets, distorted the marketplace of ideas in the service of political goals and commercial interests. The American belief in fairness and the importance of hearing “both sides” was used and abused by people who didn’t want to admit the truth about the impacts of industrial capitalism.

     Free market fundamentalists can perhaps hold to their views because often they have very little direct experience in commerce or industry.

1962

• (Friedman, 1962) ⇒ Milton Friedman. (1962). “Capitalism and Freedom." University of Chicago Press.

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