Tag Archives: Free markets

Unhappy Marxist Thanksgiving, Everyone! By Thomas DiLorenzo

The pilgrims didn’t have much to be thankful for until they discovered that capitalism and free markets work well. From Thomas DiLorenzo at lewrockwell.com:

In recent years the unhinged Marxist Left in “higher” education along with the hard-Left pop communists in the teachers’ unions have been preaching that Thanksgiving is a celebration of genocide, mass murder, and imperialism.  The Pilgrims murdered all the Indians, they say, and then sat down and treated themselves to big feast to celebrate their feat.  They even invented the elementary schoolish word “Thankskilling” to describe it.  (Send your kid to a university and he, too, can learn to sound like an uneducated Marxist moron for the rest of his life).

In reality, if the Pilgrims had anything to celebrate it was the destruction of an early form of socialism that allowed them to survive and prosper.  When the first settlers arrived in Jamestown, Virginia in May of 1607 they found incredibly fertile soil and a cornucopia of seafood, wild game, and fruits of all kinds.  Nevertheless, within six months all but 38 of the original 104 Jamestown settlers had starved to death.  Two years later the Virginia Company sent 500 more settlers and within six months 440 of them were dead by starvation and disease.  This became known as “the starving time.”  The Massachusetts Pilgrims fared no better.  About half of the 101 people who arrived on Cape Cod in November of 1620 were dead within a few months.

In 1611 the British government sent Sir Thomas Dale to serve as the “high marshal” of the Virginia colony.  He immediately recognized the problem:  The Virginia Company had adopted a system of agricultural socialism under which everything grown or produced would go to a “common store” and divided equally among all  the family groups.  The man who worked hard sixteen hours a day would be given the same remuneration as the man who did not work at all.  Dale’s solution was to establish property rights by allotting three acres of land to each man, who was still required to pay a fee to the Virginia colony (most early American immigrants were indentured servants) but then could keep everything else for himself and his family.

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Energy Subsidies, Bitcoin and the Socialist Takeover that Isn’t, by Tom Luongo

Freedom and free markets work, command and control doesn’t, not over the long term. From Tom Luongo at tomluongo.me:

“When you subsidize something, you get more of it.

Ron Paul

I have a friend who once described Bitcoin to me as an organism which feeds on electricity subsidies. Bitcoin searches out the lowest cost of electricity available and consumes as much of it as it can to produce profit for the miners, since electricity costs are their biggest costs.

This is partly why China, for years, attracted the lion’s share of Bitcoin mining. Miners could co-locate next to hydroelectric power plants in China and suck up every extra available cheap and subsidized kilowatt-hour.

This is the essence of the free market. It finds inefficiencies and exploits them as capital flows to where it is treated best. It may be ‘predatory’ from the central planners’ point of view, but they opened themselves up to this effect the moment they intervened by subsidizing the market in the first place.

Bitcoin exposed a structural weakness in China’s electricity grid this summer which was under massive stress thanks to drought conditions there dimming the output of its hydroelectric generators. This is partly why Chairman Xi Jinping took the aggressive steps to kick the Bitcoin miners out of China this summer.

He could see the real costs of electricity rising as coal, oil and natural gas prices skyrocketed but, because of rate subsidies to end-users, revenue to power generating companies was flat. It served him in other strategic ways, like kicking out the flow of Bitcoin within the Chinese economy, cutting down would-be mining company financial oligarchs and ultimately lessening competition for the Digital Yuan.

The response from the Socialist is always the same, however. Today Russia is getting blamed for gas prices in Europe.

Price gouging in a crisis a moral failure, not the original wealth transfer (itself a theft) from one group of people to another, which is what an electrical subsidy is.

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The Reasons Behind The Relentless Ideological Onslaught Against Free Markets, by Brandon Smith

Free markets are the most defensible economic arrangement ever, but few defend them and the attacks are as unremmiting as they are fallacious. From Brandon Smith at alt-market.com:

I sometimes think that the free market concept is treated like The Hunchback of Notre-Dame’s Quasimodo in the long novel of global economic history. It is considered ugly and undesirable by most people who judge it at a mere glance without bothering to understand it. It is a bogeyman; a scapegoat for numerous societal problems that it has nothing to do with. In reality, the only time free markets do cause trouble is when they are manipulated or misused by elitists seeking to turn them into something other than free markets. And, even when free markets display their great value and internal beauty, many still prefer other systems that are intrinsically corrupt but flashier on the surface.

There are many reasons behind this persistent attitude. However, they are not coincidental or natural. Human beings actually tend to gravitate toward free markets over and over again in history, and away from centralized government interference and dominance in economic trade. But whenever they do, they get hammered down by the-powers-that-be. In our modern era, establishment elites have chosen to be more subtle (for now) and dissuade people from free markets through disinformation and propaganda.

To break it all down to a simple observation – Whenever disaster strikes economically, free markets are blamed. Whenever something is fixed, even if that fix is a temporary band-aid on a sucking chest wound, government involvement and socialism are applauded. And so the cycle continues until free markets become a pariah with no place in our world and centralization becomes the prevailing answer to everything.

Free market trade is ever present at a local level and always has been. But, those who favor globalism are hell-bent on putting an end to any and all private unregulated commerce forever.

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In Defence of Free Markets, by Alasdair Macleod

Despite it’s unrivaled record as the freest and most productive and prosperous economic system, people whisper the word capitalism, if they say it all. Even the author of this article uses the term free markets, not capitalism. Socialism, despite its terrible record, is hailed as humanity’s salvation. From Alasdair Macleod at goldmoney.com:

Why is it that no one defends free markets, and socialism, despite all the evidence of its failures, comes back again and again? Unsurprisingly, the answer lies in politics, which have always led to a boom-bust cycle of collective behaviour. Furthering our understanding of this phenomenon is timely because the old advanced economies, burdened by a combination of existing and future debt, appear to be on the verge of an unhappily coordinated bust. But that does not automatically return us to the free markets some of us long for.

Cycles of collective behaviour

Throughout history there have been few long-lasting periods of truly free markets. Contemporary exceptions are confined to some small island states, forced to be entrepreneurial by their size and position vis-à-vis the larger nations with which they trade. The governments of these islands know that the state itself is not suited to entrepreneurship. Only by the state guarding the freedom of island markets and the sanctity of property rights can entrepreneurs serve the people in these communities and create wealth for all.

This is not the normal condition for larger nations. Before the Scottish enlightenment which nurtured David Hume and Adam Smith, the benefits of free trade were barely understood. Since then, the wealth created by free trade and sound money has nearly always been the springboard for detrimental change. Sometimes a political strongman, like Mao or Lenin dictates to the people what they can and cannot do. Alternatively, a leader courts popularity by taxing heavily the few for the alleged benefit of the masses. This is the model of welfare states today. Debasement of the means of exchange is an extension of these socialising policies, furthering the transfer of personal wealth to the state.

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“Capitalism Has Failed”, by Jeff Thomas

People point to present systems, none of which are capitalism by the usual definition of capitalism, and say that capitalism has failed. From Jeff Thomas at internationalman.com:

“Capitalism Has Failed”

Today, more than at any time previously, Westerners are justifying a move toward collectivist thinking with the phrase, “Capitalism has failed.”

In response to this, conservative thinkers offer a knee-jerk reaction that collectivism has also had a dismal record of performance. Neither group tends to gain any ground with the other group, but over time, the West is moving inexorably in the collectivist direction.

As I see it, liberals are putting forward what appears on the surface to be a legitimate criticism, and conservatives are countering it with the apology that, yes, capitalism is failing, but collectivism is worse.

Unfortunately, what we’re seeing here is not classical logic, as Aristotle would have endorsed, but emotionalism that ignores the principles of logic.

If we’re to follow the rules of logical discussion, we begin with the statement that capitalism has failed and, instead of treating it as a given, we examine whether the statement is correct. Only if it proves correct can we build further suppositions upon it.

Whenever I’m confronted with this now oft-stated comment, my first question to the person offering it is, “Have you ever lived in a capitalist country?” That is, “Have you ever lived in a country in which, during your lifetime, a free-market system dominated?”

Most people seem initially confused by this question, as they’re residents of either a European country or a North American country and operate under the assumption that the system in which they live is a capitalist one.

So, let’s examine that assumption.

A capitalist, or “free market,” system is one in which the prices of goods and services are determined by consumers and the open market, in which the laws and forces of supply and demand are free from any intervention by a government, price-setting monopoly, or other authority.

Today, none of the major (larger) countries in what was once referred to as the “free world” bear any resemblance to this definition. Each of these countries is rife with laws, regulations, and a plethora of regulatory bodies whose very purpose is to restrict the freedom of voluntary commerce. Every year, more laws are passed to restrict free enterprise even more.

To continue reading: “Capitalism Has Failed”