The Free Market v. Big Government Argument is a Scam: America is Getting Played by Wall Street

The Free Market v. Big Government Argument is a Scam: America is Getting Played by Wall Street July 15, 2016

markets.001Some in our society, wish to deny that economic injustice exists. It’s a level playing field, they say. This is ridiculous.

It’s not level for minorities. The top 400 billionaires in the U.S. hold as much wealth as all African-American households, plus one-third of Latino households combined (

It’s not level for the middle class. The middle class is dying. A recent Fortune article noted, “as much as 70% of the households in 25 advanced economies saw their earnings drop in the past decade… To put it bluntly: A huge swath of the world’s population, one that had been taught to expect their material wealth to grow through their lifetimes and across generations, has learned that this promise was a lie.”

Wall Street profits are up, though…

The question is not whether or not economic injustice exists, but what do we do about it? The typical debate is between free markets and big government. Wall Street says we need to let market forces correct the problem. Others say the government has to step in. The answer back from the financiers is, of course, keep the government out of the markets… which is where my frustration grows to a boil.

Free markets do not exist. All markets are regulated. The question is really, who do those regulations benefit.

The debate in our society between those who prefer free markets versus those who prefer big government is a scam run by Wall Street and corporate America in the hopes that the American public, rubes that we are, will not notice that they’ve rigged the game in their own favor. Conservative v. Liberal. Left v. Right. Government regulation v. market forces. These conflicts are a carefully constructed ruse meant to distract normal men and women from the fact that they are getting played by today’s economic titans.

Free markets are an illusion. If a marketplace is truly free, it exists with only one rule, the rule of the jungle: might makes right. A truly free market will eventually devolve into a monopoly that erases all competition. Truly free markets only exist in the wild as monopolies where might makes right until one powerful player controls the game.

All markets are regulated. In order for a marketplace to exist at all, there must be a set of rules or regulations in place that govern the way the marketplace will work. Markets can only exist when there are rules established that govern the interactions keeping one player from gaining an unfair advantage. Rules to govern the market are a precondition of any financial marketplace.

As it stands today, the rules that regulate commerce in American Society, and increasingly in the world—although most countries have much better and stronger regulation of markets than we do—benefit large corporations and the richest 1%. After the Citizen’s United decision by the SCOTUS, corporations can now legally bribe politicians, buying and selling them like playing cards, using them to rig the game in their own favor.

We don’t need fewer financial regulations. We need more of them. We need different government regulations, better ones… and simply taxing the rich won’t get the job done, either. We need to change the rules of the game so that corporations and Wall Street firms cannot continue to rig the game in their own favor, leaving the middle class to continue to struggle and shrink.

So, during this election season, when you hear a politician or pundit touting the virtues of the “free market” system, or the wisdom of “market forces,” versus the power of government… you can safely dismiss this as hot air. That person is, knowingly or unknowingly, involved in a scam. They have not questioned their own assumptions. What they call a “free market” is really a carefully regulated market with a set of rules that currently benefits large corporations, banks, and the rich. This is why the middle class is shrinking, and why poverty is still a massive problem in the midst of the most affluent culture on the face of the earth.

As long as the scam works, the titans of corporate America and Wall Street have nothing to fear. As long as they can keep the society all stirred up about whether we need big government or market forces to shape commerce, the powerful agents at work controlling the economic life of our society can continue to rig the game in their own favor… undetected.

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  • Arlene Adamo

    This is very true.

  • scott stone

    I agree the playing field isn’t level but I don’t think it’s the fault of Zuckerberg, Steyer, Singer or their peers.

    • Tim_Suttle

      I’m going to win you over on this someday, Scott!!

      • scott stone

        But it really doesn’t matter, and I mean that in the most positive way. We both agree that there is a tremendous lack of social justice and a level inequality that isn’t acceptable. If we are both working in our communities towards reconciliation, it’s all good!!
        But I am wondering if you think Zuckerberg, Steyer, and Singer are the problem.

  • jekylldoc

    While I agree with your conclusions, that we need better regulations and a political system which actively resists corporate power and upper class privilege, much of your rhetoric along the way leaves me in doubt that you do understand.

    “Market forces,” while no substitute for regulation, are in fact the goose that lays the golden egg. If not for the motivation of private gain and the corporation as a way of focusing attention on the things which people are most willing to pay for, we would be a far poorer society. Still, lobbyists who use that as a smokescreen to protect their corporations’ abuses are sabotaging market forces as much as any populist. We all need to keep our heads, not being so distracted by our anger over injustice or our desire for personal security that we abandon either market forces or caring governance.

    As Christians we are also interested in the other sources of strength in society: integrity, kindness, mutual tolerance, community support, the ties that bind our hearts in mutual love. We cannot put all our faith in government regulation (or corporate energy) and pretend that private soul-strength isn’t necessary.

  • AWRM

    I agree with all you’ve said here – markets are indeed regulated now and we only need a new set – but, I wonder if you need to say that truly free markets always end up with monopolies. It may or may not be true but why go down that rabbit hole?
    Some might say that the bigger a company gets, the further it gets away from it’s customers and the less ability it has to make quick changes to changing market conditions which opens up opportunity for newer and smaller competitors. Kodak, once big – now dead. Yellow pages, newspapers,… Of course, with the existing regulations and the legal bribery of legislators, control of the narratives, etc… large companies still wield an overwhelming advantage. But to make a broad statement like free markets always end up in monopolies opens you up to irrelevant discussions of this and it’s not central to your point. We have regulations now and we need to change them so that corporations can not achieve monopolies by the corrupt and unfair ways that you have mentioned…
    Speaking of which, it might be useful for some economist to generate a comprehensive list of all those unfair advantages. You mention legal bribery… but there are so many other less well known ways and I think it would be useful to put them all on paper. Off the top of my head: the systematic attack on unions, gushes of corporate money for corporate friendly research for publish or peril profs, corporate ownership of the media, diminishing public media, Glass Stiegal, corporate tax rates, food industry regulations, subsidies, … and for theologians: the distortions of scripture -or actually, make that the vile and flagrant violations… of scripture to fit the corporate agenda… Just an idea that I’d love to see.. a comprehensive list of the legislation and influences that sustains inequality and injustice in the USA.