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Kudlow & Cramer on CNBC: This next guest is a real capitalist. At a time when the steel industry in the U.S. is on the ropes, he has his stock go up ~350% by selling steel scrap to China. ... Kudlow: ~"Do you think steel companies need government help, these tarrifs, to stay in business?" Steel magnate: "No, I don't." Kudlow: ~"That's a relief! Kudos to you sir. He deserves to be successful just for that." -CNBC, December 2, 2003
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The price of gold in SDRs has broken out above 276 to a new multi-year high. See the green line on the chart.
I don't think you've defined the problems correctly at all. First of all, the market process virtually everywhere in the world is well understood by the participants. It isn't a matter of educating people as to what a free market is, they already know what a marketplace is, they use it everyday. -ET
A free market is a theoretical geographical area in which people can trade anything they own for anything others own and are willing to trade --- and at what ever "price" they agree to without any coercion --- and no interference by ANY unwanted third parties in any way what-so-ever. No rules, regulations, orders, or controls. No taxes. No loom-stealers or vat-smashers. No protections for either "buyers" (those with "money" to trade) or sellers (those traders who want to trade FOR "money") unless they agree to such between (or among) themselves. Certainly no protection for the "vested interests of entrepreneurs, capitalists, land-owners, and workers" or any other non-participating, non-present (establishment) traders simply because they don't like the competiton!Perhaps this doesn't all ring true to you? Well, Mises explains it in a bit more scholarly manner:
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As I think you can see, we don't have any free markets in the united States, except perhaps in the case of private transactions that ignore all the rules, regulations, orders and controls - - - and if the people involved don't pay any "Taxes, Duties, Imposts and Excises" to unwanted third parties. In a major perversion of fact and practice, such unhampered free-market transactions are regularly labeled as occuring in a "black market" -- because, remember, the establishment "vested interests" (including business, labor and our seller half) don't like the effects free-market competition has on the prices they are able to charge. Free Trade: The Good, The Bad, and The Ugly: The Ugly
The consumers do not care about the investments made with regard to past market conditions and do not bother about the vested interests of entrepreneurs, capitalists, land-owners, and workers, who may be hurt by changes in the structure of prices. Such sentiments play no role in the formation of prices (It is precisely the fact that the market does not respect vested interests that makes the people concerned ask for government interference.) [emphasis added] -Ludwig von Mises, Human Action A Treatise on Economics, Third Revised Edition (Chicago, Illinois: Contemporary Books, Inc. 1966), pg. 337 [available also from http://www.mises.org/humanaction.asp]So we are not only up against the "vested interests" of capitalists and entrepreneurs, we are also up against land-owners and workers when we advocate free trade in free markets. It's for that reason I think we have a lot of work to do if we hope not to become more mercantilist, even fascist.
I don't think people are as woefully uneducated as you apparently believe. -ET
Secondly, your second premise [that people equate the word "capitalism" with mercantilist behavior -j.] is just plain wrong. You take a defined term, as you've done below, then change the definition to fit the outcome you want, and declare that "pop culture" doesn't get it. -ET
I don't think most people associate corrupt government / big business with capitalism. I would be very interested in your documentation of this claim, since your whole argument revolves around it. -ETGood! If you're correct, people aren't "woefully uneducated," most people don't "associate corrupt government / big business with capitalism" -- and "pop culture" does get it, that makes our job a lot easier.
Yes, j-man, you can certainly document, over and over, the problems with government interference in the marketplace. However, you, for some reason, want to then turn around and blame the disease on the marketplace. Sorry, your argument lacks any credibility. That is why we have definitions for terms. You correctly describe fascism for what it is. Unfortunately for your argument, it isn't capitalism, unless of course you change the definition of capitalism to that of fascism. -ETI don't blame the disease on anything, I just describe its etiology. Selfishness, particularly "clique selfishness" [3] is the base upon which this "disease" is built, and a firm altruistic base [4] it is, solidly rooted in human nature. Government is the "vector" that delivers it to our door, gaining much of it's power by promising to do just the opposite. My preference to fix things would to be to completely eliminate the vector from the marketplace -- and for that matter, elsewhere.
You're winning and you don't even know it. SLATT is right and I agree with him entirely; the world is not headed for the doom and gloom scenario so many seem to want to believe is just around the corner. Like I mentioned earlier, capitalism is breaking out all over. Everything you've criticized in your posts is the reaction of vested interests trying to hang on to the past. Take a look at the future; more of the world is abandoning controlled markets everyday. Because of technology, the average guy is becoming more adept at circumventing controls on both capital accumulation and trade. The real source of your anguish, as I see it j-man, is the bad money, not some argument over the definition of capitalism. None of the problems you've cited would be near as bad or even in existence, were money sound. The rising price of gold is a good omen, my friend. It signifies that markets are abandoning the fascist model. Actually, I believe this is occurring because the marketplace is much freer than you want to believe. Those that have benefited from the status quo will no doubt try to keep things in place, but like the Russian government learned, at some point, people just walk away. It's a market thing. -ETIt is fully possible that my perceptions of what I think people believe, built on observations of u.S. culture in the 50s & 60s, my formative years -- and fostered by exposure to Rand -- are out dated. If you could provide some documentation or your reasons for what appears to me as extreme optimism, I'd be much obliged, and I'd be quite happy to join the ranks of the optimistic.