Wednesday, July 27, 2011

Is Thomas Friedman Impervious to Facts? | Beat the Press

Is Thomas Friedman Impervious to Facts? Beat the Press

Over at his Beat the Press blog at the Center for Economic and Policy Research, Dean Baker & friends answer in the affirmative: here.

Progressives whose fundamental tenet is balance - that is, Delphic Optimalists - do not ignore the problems that Friedman ignores.

Free markets are great... up to a point. Markets fail, no matter how much the pro-business/anti-government savants wish it otherwise. To deny that fact is to deny:
- the Panic of 1819-21 (cotton price collapse, debt deflation)
- the Panic of 1837-43 (wheat crop failure, cotton price collapse, depressed foreign trade, currency issues (expiration of central banking, co-ordination & trust problems from having multiple private & public issuers), asset bubble (land), generalized food price deflation, widespread financial institution failure)
- the Panic of 1857-59 (financial institution failure, irrational exuberance leading to another asset bubble (railroads, stock market)
- the Panic of 1873-78 (yet another speculative asset bubble (railroads & stocks, again), Jay Cooke & Co. bankruptcy)
- the Panic of 1893-97 (stock market asset buble, debt deflation, widespreadbusiness failure, mass unemployment)
- the Gilded Age (widespread exploitation of labor via unfair wages & unsafe working conditions, rampant monopoly formation)
- the Banker's Panic of 1907- (lack of central banking, contraction of the money supply,
- the Stock Market Crash of 1929 & the ensuing Great Depression,
- the Dot Com Bubble,
- the most recent Great Recession...

The rabid, reflexive free market fundamentalism of modern movement conservatism is a kind of right-wing Fantasyland: an alternate universe that bears no resemblance to the real world we live in.

The folks at CEPR point to another classic failure of markets: health care.

How is it that the supposedly most productive capitalist system in the world - America - produces health care at a cost that is 70% higher than its closest idustrialized peers (OECD nations), yet achieves outcomes that are [at best] no better -or- [often] worse? The claim that the American system is the most advanced & delivers the best health care does not pass the straight face test.

Why Friedman would assail Social Security as anchor on the long-term structural budget deficit is a mystery? SocSec can remain solvent for as far as the eye can see without benefit cuts or raising the retirement age: merely lifting the cap on the wages subject to the payroll tax would cure any conceivable solvency risk for at least 75 years.

Long story made short: Friedman is a shill for the corporate/capitalist plutocrats, whether he realizes it or not.

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