Free Market Myths

The Myth of “The Free Market” is like the collective agreement on the internet that Kanye West’s Yeezus and Grimes’ Visions are good albums. There’s rarely room for debate or disagreement, because, well, that’s just how it is in our society. Herd life can be boring at its best, dangerous at its worst. There isn’t a day that goes by where I don’t read some kind of middle-class capitalist rhetoric stating that “if only the market was completely free from government distortions, then…”. You can fill the rest in with whatever economic or social policy needs to be saved from the state if you’d like, but then you would become something that even Karl Marx abhorred. A utopian.

The utopian dream of the free market is nothing but the sigh of the petite bourgeois after coming home from work, sitting on the couch, and turning the television on to such channels that glorify haute bourgeois status. Of course, as with statistical analysis, there is some measure of error. I’m well aware that not everyone will fall into this niche, but hear me out anyway.

In Ha-Joon Chang’s book 23 Things They Don’t Tell You About Capitalism he writes:

The usual claim by free-market economists that they are trying to defend the market from politically motivated interference by the government is false. Government is always involved and those free-marketeers are as politically motivated as anyone.

Take, for example, a committee formed by the American Medical Association called the Specialty Society Relative Value Scale Update Committee. RUC for short. This cartel of doctors sets the price of every single medical practice and procedure you can think of from a basic wellness visit to a cardiac stint. The prices are then used to determine what government services like Medicare and Medicaid can be billed for which is a big determining factor on what health insurance policy owners will pay as well. “Special Deal” is a piece in Washington Monthly in which some light is shed on to the mostly unknown cabal of primary and specialty care doctors jockeying for position to get a bigger piece of the tax-payer money pie. They are, in other words, setting their own salary. So if you wonder like I do why health insurance costs so much here in the US this is a good place to start.

If this sounds familiar it is, it’s what worker’s unions do. They negotiate their wages and benefits collectively while management sits on the other side of the table trying their best not to cede too much power. Every day I read something new online about union bashing; how unions are the root cause of so much middle-class labor woes, though this Marxist doth protest. People on the right, whether they be Republican or Libertarian-Populists, are fighting the wrong kind of battle if all they’re arguing about is how unions take jobs away from people. No, they don’t. In fact states with Right To Work laws have lower wages and benefits and have . This right-wing plank has been used to chip away at worker’s rights for 30 years and has led us to the point we are now at in our economy. But, if you take them at their word that unions are a market distortion then surely you can’t be serious when looking at the bigger picture. There are problems at hand that class/political divisions must come together to solve.

We will never have a completely free market. The market system itself constantly needs governments to prop it up. For that reason, as a Marxist, I am very critical of capitalism. I will end with this quote by David Graeber from his book Debt: The First 5,000 Years:

This is a great trap of the twentieth century: on one side is the logic of the market, where we like to imagine we all start out as individuals who don’t owe each other anything. On the other is the logic of the state, where we all begin with a debt we can never truly pay. We are constantly told that they are opposites, and that between them they contain the only real human possibilities. But it’s a false dichotomy. States created markets. Markets require states. Neither could continue without the other, at least, in anything like the forms we would recognize today.


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