Care to point out some examples as to how great it is in practice?
Do you believe in the free market?
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In the latest episode of the United Hour Podcast, Nik and Imran are here to talk about a frustrating 2 points dropped at Crystal Palace. They then discuss the regeneration of Old Trafford. Finally, Nik is joined by special guest Michael Statham from the Football Oranje podcast - who gives us a more in depth look at our EL opposition FC Twente, and then runs through the (many) Dutch connections currently at United.
Care to point out some examples as to how great it is in practice?
If you think the trains are bad, you'd hate to hear about buses being late on such a regular basis that an hour delay doesn't make people flinch anymore.
If you're reading this megabus, feck you. Just, feck you.
No I never did and even got almost spanked by my professor at the Uni when I gave him my paper.
A free market theory is fine in a world of perfect information.
The idea that we have any kind of free market beggars belief.
We have the most draconian government/big business led model you could imagine.
Communist morals abound for freedom, choice, big society preached while at the same time championing bankers and big corporations with bailouts, tax breaks. civil honours etc....
It's like splitting up Germany after world war two in a narrative government bluster.
The idea that we have any kind of free market beggars belief.
We have the most draconian government/big business led model you could imagine.
Communist morals abound for freedom, choice, big society preached while at the same time championing bankers and big corporations with bailouts, tax breaks. civil honours etc....
It's like splitting up Germany after world war two in a narrative government bluster.
free market => open door for globalization
globalization => modern slaves => cheap products => losing jobs => rich getting richer => governments controlled by big corporations => recession => more welfare => is not what you do for the country but what the country does for you=> illusion that we still a rich country=> I already had too many margaritas =>
globalization => modern slaves => cheap products => losing jobs => rich getting richer => governments controlled by big corporations => recession => more welfare => is not what you do for the country but what the country does for you=> illusion that we still a rich country=> I already had too many margaritas =>
The free market society as described by what I suppose you'd call "Friedmanism"? No. Markets have great benefit to society yes, but the absolute extreme unregulated market that seems to be society's current version of Utopia is completely unrealistic and logically impossible. It's certainly not the ideal mechanism upon which to base a society. Almost any concept taken to its absolute extreme is usually not a good thing, why some people think free markets are an exception is puzzling to me.
There aren't any free markets in existence, however, there are countries which are relatively free in comparison to others; and there is a very strong correlation between economic freedom and an increase in general human welfare.
Because there isn't a free market, it's much easier for me to show where centralised and mixed economies don't work - which is everywhere.
The Scandinavian countries, which have the best record when it comes to human welfare, are hardly capitalist on steroids are they? I think you've confused personal freedoms with economic ones. Obviously communism is unworkable in reality, but that doesn't lend itself to fully fledged free markets being the right answer.
And please elaborate on how you think deregulation would fix the world economy, because I fail to understand. Do you think coca-cola would have more competition? Do you think the energy companies would? How about the banks?
There needs to be a distinction here between privatisation and marketisation. The train services aren't a free market because all that happens is the government leases out train routes to companies for a set period. Yes, it's owned privately, but I don't see how a collusion of corporations and government can be called 'naked, unrestrained capitalism'.
Actually, the Scandanavian countries are usually ranked in the top 10 countries for economic freedom in the world. For example, it's far easier and cheaper to run a business in Sweden than it is in the US.
To answer your questions: yes, and yes. As for banks, the financial services sector is the most heavily regulated industry in the UK and the US. Regulation has clearly not worked. One of the biggest problems with the sector is that financial institutions have government guarantees against going bankrupt, as evidenced in 2008 and since then through the bailouts.
There's no real difference between economic and 'personal' freedoms. Restricting economic freedoms is just telling you what you can do with your property. There is no particular logical difference between telling you that you can't sell your laptop (for example) and telling you that you can't write political essays with it.
Interesting, I always thought of the Scandies as fairly left wing, I'll have to read more about that.
So you would have left the banks to go bankrupt then? Or do you think that they wouldn't have gone bankrupt if there was less regulation? Do you think the toxic mortgages they created and the entire feckery that went down in Goldman Sachs wouldn't have happened?
I'd say there's quite a big difference there, one stops you from making a monetary transaction the other stops you from expressing something. Regardless, that's a rather small-time example, I don't think anyone is arguing that selling your laptop should be regulated against, they might however argue that software and hardware companies have to meet certain guidelines.
Good questions. To the first one, leaving banks to go bankrupt creates an incentive for banks to be more prudent with their lending practices, so yes. The second one is kind of complicated, the world isn't perfect so it's possible that, sans regulation, some banks would go bankrupt now and again because of poor management, but the kind of institutional crisis we saw in 2008 would be impossible.
The last question is even more complicated. It's really important to know why banks were so quick to go into the sub-prime market. And that is a combination of things. 1. Political pressure 2. It's low risk for them because the government guarantees them if they go bankrupt and 3. low interest rates made created an environment where debt was cheap 4. accounting tricks like derivatives purportedly reduced the risk of sub-prime.
And none of those factors apart from 4 would exist were the market free.
Our current civilisation has hit a rut, but we're too entrenched to change it. Education is a good example of this. We're teaching kids things from an early 20th century model, when we should be updating and discarding according to what's appropriate for the modern age. Kids leave school these days with no inclination of how to live an adult life, only with cursory knowledge of things that've passed them exams.
The free market will have made irreconcilable damage to the housing market, and thus the prospects of every younger generation, and we'll all sit around acknowledging it, but doing nothing, because we're far too entrenched in the current system. We could all just agree to sort it out for the benefit of the future, but we wont. It's the equivalent of knowing an asteroid will hit but doing nothing because enough important people have invested in bunkers. And it would disrupt the status quo too much to try.
As a Londoner, I know there'll be more riots in the next 10 years, the worse things get and the less able people are to afford property. We talk about it all the time, which makes it even more ridiculous.
The free market will have made irreconcilable damage to the housing market, and thus the prospects of every younger generation, and we'll all sit around acknowledging it, but doing nothing, because we're far too entrenched in the current system. We could all just agree to sort it out for the benefit of the future, but we wont. It's the equivalent of knowing an asteroid will hit but doing nothing because enough important people have invested in bunkers. And it would disrupt the status quo too much to try.
As a Londoner, I know there'll be more riots in the next 10 years, the worse things get and the less able people are to afford property. We talk about it all the time, which makes it even more ridiculous.
The example was deliberately small time. All that is happening is that you are being stopped from expressing a preference. It doesn't matter that one preference involves money, in both cases you are being stopped from doing something beneficial to you with your stuff. And I would argue that wherever people are banned from expressing preferences, you have perverse outcomes.
Free Markets - yup they're brilliant, open competition, you adapt to survive blah blah blah - now tell me about the billions in subsidies the EU and the US hand out every year to 'help out' local industries. Not exactly the level playing field people talk about in theory.
I'm not saying I don't believe in it, or don't think it is on the whole good.
I'm not saying I don't believe in it, or don't think it is on the whole good.
They are, there's just no real conflict between left-wing and ease of doing business. We've still got fairly heavy regulation, and state owned industries, and worker protection, and welfare, etc.
I believe in a free market much more than I believe the market is free
Chinese companies banned from buying commercial ports in america
The solar / wine dumping allegations
Huawei's technology being used by bt coming under question
Opec "fixing" oil prices
It seems states and multi state organizations choose how "free" a free market is based on their iwn interests
Chinese companies banned from buying commercial ports in america
The solar / wine dumping allegations
Huawei's technology being used by bt coming under question
Opec "fixing" oil prices
It seems states and multi state organizations choose how "free" a free market is based on their iwn interests
The problem with both theories is there is nothing but semantics between them.
Both are under monopolistic control. One by a huge state 'for the people' the other by goliath corparations for their 'stakeholders'.
A choice between stipulation and obligation.
Both are under monopolistic control. One by a huge state 'for the people' the other by goliath corparations for their 'stakeholders'.
A choice between stipulation and obligation.
I don't think British trains are as shit as we say they are. I've very rarely had any problems with them despite using them all the time. Having said that, others do complain about them a lot.
Yeah, Polish government pretends to be right wing and they make it near impossible to run a business here, all taxes and obligatory insurance (worst of all) eat up to 70% of what a company makes. I had my own business set up until earlier this year, there were months where I'd be making a loss in spite of fulfiling a few contracts because they'd make me pay extra money in taxes and insurance for no clear reason at all, not to mention all the pointless fines I got for silly things like not responding to a letter I didn't even receive yet. I have learned to get around that by being employed part time with the company I work for the most (the rest of my income goes through a separate company registered under my name) and who pays a minimum insurance fee for me and it prevents me from being obligated to do a million things and submit a million documents I don't even need to do and now I'm only giving away around 30% of what I make. Right or left wing doesn't really matter that much when it comes to the ease of running a business.
Unfortunately for profit companies can not be trusted to be responsible. Early in the thread, there was mention of self regulation. As pointed out that is laughable. I know of an industry that is supposed to aid human health which WAS self regulated let led to several end user deaths and some serious health issues. Can you imagine if mining companies were allowed to act totally freely? The damage they cause now is bad enough. Lack of regulation hurts so many, not just the poor workers but the general public too.
The problem with regulation is those in charge of implementing and overseeing. They are often inept or easily bought.
The problem with regulation is those in charge of implementing and overseeing. They are often inept or easily bought.
It's actually difficult for me to understand how we can have people who cry out for deregulation when the lack of regulation just a few years ago lead us into the biggest global financial disaster since the Depression. I know CDOs and derivatives are hard to understand, but it doesn't take an economic genius to see how lack of regulation (and even active deregulation) contributed heavily to the crisis.
Course I do. If I ever get nicked and need a barrister, I'll call Eddie Stobart. He'll send one round in one of those big feck-off lorries. http://www.stobartbarristers.co.uk/personal/driving-offences/
Leaving the banks to go bankrupt would also be catastrophic for the economy as a whole, the banks know this. For the government to say "we'll let you go bankrupt" would be silly. Not to mention, the government will get its money back from that bailout, it's not like it's plunging money into a hole and its never going to see it again.
Separating the investment sector from personal banking however, would be a welcome regulation. It would allow us to let the bad investors to go bankrupt without it having an awful effect on the economy as a whole. To say that less regulation would stop them going bust doesn't make sense, all there needs to be is proper regulation that protects the economy, rather than bankers interests. Without this rule, there's no incentive for the banks not to make ridiculous bets. They know how powerful they are, anything else doesn't really make sense. As I said earlier, the question should be about the regulations themselves and one of the mistakes in the banking crisis was that the regulations weren't very good.
But no one is arguing such petty transactions. Unless you think one person selling their laptop is equal to PC world selling thousands. Rules and regulations should vary to reflect the differing circumstances of different people and businesses.
Yeah, it might have been bad had the banks been left alone, but what we've got now is a long time of low growth and then eventually we will have a much worse depression (think Greece) because governments aren't omnipotent - they will run out of policy levers and it will be terrible.
The idea that the governments are going to get their money back from those transactions is fictitious. They bought into the banks at inflated prices, and even if they get the same price now, they would actually be losing a vast amount of money in real terms. Most banks right now are practically insolvent, and all we're doing is paying them for their bad business practices, so they won't change.
'Proper regulation' is impossible, outside of the free market. Why? Because politicians can't be expected to write good legislation, the majority have about the same understanding of the financial markets as you do, and the ones that do have an idea either work for the financial services industry, or are in their pockets. Creating a legal separation between the so-called 'commercial' and 'personal' banking is stupid because no one can actually say what the difference is. All banks take deposits and lend money, that's what they've always done and will always do. I gave you reasons why the 2008 crisis happened, and separation doesn't fix those problems and wouldn't even achieve the separation to begin with.
I was merely trying to point out what is in fact happening with regulations. I actually have no problem with regulations on behaviour, for example, there's a regulation that prohibits me from killing someone. However, the fact is regulation on economic transactions works in very rare circumstances, and where it does work, it creates massive social problems. I can't identify any material difference between me selling a laptop and PC World doing it, but hey-ho.
People need to do some research before saying these things; as I said previously, the financial services sector is far and away the most heavily regulated industry in Europe, the UK and the US. There's nothing particularly difficult to understand about CDOs and derivatives, in fact I mentioned them in a previous post about what caused the 2008 crisis - but it certainly was not a lack of regulation.
There's a whole lot of prominent economists who disagree with you on that. In fact, I think you're the first person I've seen since Bill O'Reilly to suggest that lack of regulation didn't have anything to do with the crisis. How could it not? Lack of regulation allowed the big American banks to take more risks, particularly in regards to CDOs, which together with the (intentional or otherwise) incompetent rating lead to a massive increase in the amount of mortages that were defaulted on. Obviously it was a lot more complex than that, but it seems like a very controversial claim to insist that at no point was lack of regulation an issue. Particularly considering the US financial system has been actively deregulated the last few decades.
Of course, I'm not an economist, but the ones I've read seem to think it had an effect.
Of course, I'm not an economist, but the ones I've read seem to think it had an effect.
How far would you de-regulate then? 0% taxes and no product regulations? Because surely, if you're opposed to those, you must be in the camp of people saying things need to be regulates well, rather than not at all.
And I take your point about politicians being quite crap at their job, but that doesn't mean we do away with everything.
And I take your point about politicians being quite crap at their job, but that doesn't mean we do away with everything.
Actually, plenty of people claim that regulations caused the crisis. They tend to be libertarians and/or Ayn Rand fanatics, and their argument is that the government forced banks to lend to unqualified people. Or they'll say that the banks knew that they would be saved anyway, so they weren't scared of going bust.
Both of those are conspiracy level claims, but then you did say the magic words, "Ayn Rand".
Is Andrew a libertarian?
Is Andrew a libertarian?
I've had a few discussions with Ayn Rand fans. They're just absolutely convinced that the market is perfect, that selfishness is a virtue and altruism is evil, and that government is evil/corrupt/incompetent and regulation is counter-productive etc. And they've all memorized talking points on what to respond in certain situations.
Libertarianism is odd, in that it's something I've only ever come into contact with online, and always with Americans. As far as I know I've never met a single Norwegian libertarian. I might have met one or two anarchists, but I doubt they would be happy to be compared to Ayn Rand's acolytes. I always have an air of slight disbelief when listening to libertarians. You have someone like Ron Paul, who sometimes seems to say very intriguing (and "liberal") things, before rapidly going off on the deep end.
It's almost like I have to remind myself they're a real thing.
It's almost like I have to remind myself they're a real thing.
No disrespect to those prominent economists, but they are wrong on that front. Ben Bernanke, the out-going US Federal Reserve chairman and prominent MIT economist, failed to identify the crisis coming even a few months before it happened in 2008; whereas, people like Ron Paul or Peter Schiff, who I would describe as amateur economists at best, could see it.
Saying a 'lack of regulation' allowed banks to take risks doesn't really make sense because banks take risks even with actions that are directly regulated - example, only last year HSBC was exposed as laundering money for the Iranian government and drug cartels. More than that, the only significant 'deregulation' in the financial services sector was the removal of the Glass-Steagal Act requirements.
I would suggest you're reading the wrong economists.
No, my point isn't that politicians are crap at their jobs, it's that we are asking them to do something which is impossible. And that is why we need to do away with it all.
I believe that there is only one form of legitimate taxation, and that's the land-value tax. Google it; it's very interesting.
Can you prove that? Are you claiming that the banking sector is "far and away" more regulated than, say, oil drilling?
I agree there is a lot of regulation in the banking sector though.
No, it's not that the market is perfect, it's just a better way of solving social problems than government. I wouldn't presume to be the purveyor of morals so I wouldn't say altruism is evil, rather that it doesn't exist. Basic game theory put to bed the idea of 'selfless acts' quite a long time ago.
"Det Liberale Folkepartiet", those are all Ayn Rand people (luckily they're not many though).
Yeah, the cult of Ron Paul pretty much consists of (mostly young) people who have not bothered to actually examine any of his political positions apart from his "war is bad, mmkay" stance.
Ron Paul and Peter Schiff predict Armageddon once a month though.