Free-market capitalism always fails.
But then all systems we’ve ever tried have all failed eventually, and free-market capitalism at least fails safely when so many other systems don’t. For example, some might contend that the highest and brightest thoughts we have about economic systems tend to lead us to conceive of something like socialism, where all resources are shared fairly and equally in love and co-operation.
Sadly, the world is populated not just by fair-minded and co-operative souls like you and I (who might be able to make a go of that) but also by the greedy, the lazy, the crazy racists and everything in-between – our system of economic governance has to be robust and not just cope with them, but generate progress despite them.
And it gets worse.
Because the people who conceived it may have been nice (although they weren’t), and all the people being asked to live it might be lovely (but we’re not) but the people always asked to shunt it into being are not even able to do so. Lying politicians for the most part, with their short-term view of the political cycle and their determination to get elected by hook or by crook (someone once said politicians are like nappies – they need to be changed often, and for the same reason)
So when socialists argue that socialism has not really been tried, and by that they mean no human society has ever managed to implement it “properly” (although they are happy to claim it as a socialist success story while it seems to be working), we might say that it will never be tried properly. In a way, it is too good for us.
We need something that works well even when it’s being implemented by lunatics – a car that is safe even if the driver is drunk. Not economic systems that only yield results when implemented perfectly – we need systems that work well even when implemented horribly, by idiots.
Because we have seen enough of politicians to know that’s the best most of them can manage.
We need economic systems that fail safe.
Free market capitalism does that – it uses greed and fear and stupidity as fuel in the engine of progress, and fortunately there’s no shortage of all that.
Free market capitalism is not merely superior in design to other ways of ordering economies and allocating scare resources (although some contend that it’s that too), it is superior in the way it fails – safely.
When it fails, yes we get rich annoying businessmen with massive yachts, but we can still deliver free housing and food and clean running water and world-class healthcare to our poorest – the inequality is horrific, but all that free stuff is still pretty great. Just ask the average person on planet Earth, who lives on about five dollars a day.
But when socialism (superior in design perhaps) fails, we get something completely different – rich tyrannical rulers cruising the country in limousines while the population starves – the inequality is also horrific, but starving to death in the snow……..that’s horrific too.
On balance, I think we prefer poor people to have free housing, food, running water and world-class healthcare.
Because the alternative has always been mountains of their skulls in the snow.