Wednesday, May 2, 2012

Professor Noam Chomsky: '"Free Markets?" (1997)'

Source:Santarchy- MIT Professor Noam Chomsky talking about the free market in 1997.
"This talk by Noam Chomsky was filmed at Northeastern University, Boston on Dec. 5, 1997"


"The free market is an economic system based on supply and demand with little or no government control. It is a summary description of all voluntary exchanges that take place in a given economic environment. Free markets are characterized by a spontaneous and decentralized order of arrangements through which individuals make economic decisions. Based on its political and legal rules, a country's free market economy may range between very large or entirely illegal." 

From Investopedia 

"In economics, a free market is a system in which the prices for goods and services are self-regulated by buyers and sellers negotiating in an open market without market coercions. In a free market, the laws and forces of supply and demand are free from any intervention by a government or other authority other than those interventions which are made to prohibit market coercions. Examples of such prohibited market coercions include: economic privilege, monopolies, and artificial scarcities.[1] Proponents of the concept of free market contrast it with a regulated market in which a government intervenes in the exchange of property for any reason other than reducing market coercions.

Scholars contrast the concept of a free market with the concept of a coordinated market in fields of study such as political economy, new institutional economics, economic sociology and political science. All of these fields emphasize the importance in currently existing market systems of rule-making institutions external to the simple forces of supply and demand which create space for those forces to operate to control productive output and distribution. Although free markets are commonly associated with capitalism in contemporary usage and popular culture, free markets have also been components in some forms of market socialism.[2]

Criticism of the theoretical concept may regard realities of the difficulty of regulating systems to prevent significant market dominance, inequality of bargaining power, or information asymmetry, in order to allow markets to function more freely.

Historically, free market has also been used synonymously with other economic policies. For instance proponents of laissez-faire capitalism, may refer to it as free market capitalism because they claim it to achieve the most economic freedom." 

From Wikipedia 

"Laissez-faire is an economic theory from the 18th century that opposed any government intervention in business affairs. The driving principle behind laissez-faire, a French term that translates to "leave alone" (literally, "let you do"), is that the less the government is involved in the economy, the better off business will be, and by extension, society as a whole. Laissez-faire economics is a key part of free-market capitalism."

From Investopedia  

If your definition of a free market is: "The free market is an economic system based on supply and demand with little or no government control. It is a summary description of all voluntary exchanges that take place in a given economic environment." then you also believe in Fantasyland, perhaps Santa Clause as well, because that type of economy doesn't exist anywhere in the world. And even people who claim to believe in the free market, put at least some restrictions on whether people should be allowed to organized in labor unions and would seriously restrict labor unions, if they couldn't outlaw them. 

What the developed world has, including America, but Canada, Europe, Japan, Korea, have are private markets. A private market is where most, if not all commerce and for-profit industries, are in private hands and privately owned, but that is regulated by government and pays taxes to the government. 

You are not going to find a successful, purely communist state in the world today. Even countries that still have communist government's, that have seen rapid economic growth, the last 30 years or so, like the People's Republic China, how have private economies, private property, private ownership of the businesses. But China is obviously not a free market either. 

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