Here’s an important point to remember: When pols talk about regulating “the economy” they are talking about regulating people. Excerpt:
Strictly speaking, it’s not markets that can and should be free—it’s people. The term free market merely describes one political-legal context in which people conduct themselves. It’s shorthand for a subset of human action—the exchange of goods and services, usually for money. (The logic of human action, the study of which Ludwig von Mises called praxeology, applies to all purposeful conduct, not just market exchange.)
It follows, then, that when politicians and activists call on the government to regulate the economy, they mean to regulate us. There’s no economy to regulate. It’s not a machine or a vehicle. It’s an unending series of purposeful activities the logic of which gives rise to a process characterized by regularities. Hence, for example, the law of supply and demand. We can talk about this orderly process—the market—as though it were a thing, but we have to keep its metaphorical nature in mind. It’s still only people cooperating with each other.
When market critics demand government regulation, they imply that markets are by nature unregulated. But we’ve just seen that this is nonsense. An unregulated market is a logical contradiction. That we call it a market indicates the regularities, or laws, just mentioned. No regularity—no market. There could no more be an unregulated market than there could be a grammarless language or a perpetually disorderly society. We would not call a population a society if it did not display a general order expressed by rules (written and unwritten), customs, and mores. Without such things, a population would be not a society but a Hobbesian state of nature.
What this article omits when writing of free markets is the appending of the term “capitalism”:
Free market capitalism.
There are damn few pols of any political stripe who actually support honest free market capitalism. (Rand Paul comes closest.) But here’s the thing about capitalism: There is no real “ism” there. In true free market capitalism, there is no underlying ideology, no central dogma, except liberty. Free market capitalism consists only of free people engaging in free trade with one another, using their own skills, talents, abilities and assets to trade with others for their skills, talents, abilities and assets to the mutual advantage of all parties.
How could anyone be against that?
Ronald Reagan once pointed out that liberals “aren’t always wrong – it’s just that they believe so many things that aren’t so.” Would-be market regulators are much the same. The problem – no, not the problem, the really scary thing about politicians that want to regulate
markets your economic freedom is that not only do they believe things that aren’t so, they are willing to use force – men with guns – to compel you to comply with their beliefs.
You cannot have both.
The market in microcosm takes essentially this form:
Producer: “I have produced Item A. I would like to sell Item A for $5.”
Consumer: “I would like to have Item A. Here is $5.”
Producer: “Thank you.” Producer then uses the $5 to purchase more raw materials to make more Item As.
Both parties gain value. This is the only legitimate way for economic transactions to take place; if they take place by coercion, that is theft, and if they take place by deception, that is fraud.
That’s how economies grow, True Believers, because we are the economy. And if we are free – truly free – then unless theft or fraud has taken place, there’s no damn room for government regulators to stick their noses in.