The Interventionist Economy

When it comes to identifying the role of government in their conception of the market order, many if not most “conservative” economists still assume that government must be responsible for a social safety net that includes Social Security, some form of government-provided health care, and unemployment compensation; must have discretionary monetary and fiscal powers to support supposed desired levels of employment and output; must regulate industry to assure “competitive” conditions in the market and “fair” labor conditions for workers; and must directly supply certain goods and services that the market allegedly does not provide.

Indeed, many people who claim to be “on the right” believe that government should institute some or all of these “public policies.” It should be appreciated, however, that the very notion of “public policy,” as the term is almost always used, supports government intervention in the market in ways that are simply inconsistent with a genuine free market economy.

Interventionism as public policy is not consistent with the free market since it intentionally prevents or modifies the outcomes of the market. Here are the eight points of the interventionist economy:

The private ownership of the means of production is either restricted or abridged by government.
The full use of the means of production by private owners is prohibited, limited, or regulated by government.
The users of the means of production are prevented from being guided by consumer demand through a network of government regulations, controls, prohibitions and restrictions.

Government reduces the impact of market supply and demand on the success or failure of various enterprises while increasing the impact of its own influence and control through such artificial means as price and production regulations, limits on freedom of entry into segments of the market, and direct or indirect subsidies.
Free entry into the domestic market by potential foreign rivals is discouraged or outlawed through import prohibitions, quotas, domestic content requirements, or tariffs, as well as capital controls, and restrictions on freedom of movement.

The monetary system is regulated by government for the purpose of influencing what is used as money, the value of money, and the rate at which the quantity of money is increased or decreased. And all these are used as tools for trying to affect the levels of employment, output, and growth in the economy.
Government’s role is not limited to the protection of life, liberty, and property.

Defining the Free Market Economy

Socialism, communism, fascism and Nazism are now all but dead. They failed miserably. But they have been replaced by what is merely another more watered down form of collectivism that may be called “interventionism.” Indeed, interventionism is the predominant economic system in the world today. In 1929, Ludwig von Mises published a collection of essays under the title, “Critique of Interventionism.” He argued,

“All writers on economic policy and nearly all statesmen and party leaders are seeking an ideal system which, in their belief, is neither [purely] capitalistic nor socialistic, is based neither on [unrestricted] private property in the means of production nor on public property. They are searching for a system of private property that is hampered, regulated, and directed through government intervention and other social forces, such as labor unions. We call such an economic policy interventionism, the system itself the hampered market order.”

He added, “All its followers and advocates fully agree that it is the correct policy for the coming decades, yea, even the coming generations. And all agree that interventionism constitutes an economic policy that will prevail in the foreseeable future.”

With the demise of communism in the 1990s, public policy around the world, including in the United States, is back to where it was when Mises wrote these words 85 years ago. Comprehensive government ownership of the means of production and a fully centralized planned economy has very few adherents left, even “on the left.” At the same time, in spite of all the casual rhetoric about the triumph of capitalism, we have not seen much evidence of a movement toward a truly free market system.

Here are eight points that define a genuine free market economy, or what Mises referred to as the “unhampered economy”:

All means of production are privately owned.
The use of the means of production is under the control of private owners who may be individuals or corporate entities.
Consumer demands direct how the means of production – land, labor, and capital – will be used.
Competitive forces of supply and demand determine the price for consumer goods and the various factors of production including labor.
The success or failure of individual and corporate enterprises is determined by the profits or losses these enterprises earn, based on their greater or lesser ability to satisfy consumer demands in competition with their rivals in the marketplace.
The market is not confined to domestic transactions and includes freedom of international trade, investment, and movement of people.
The monetary system is based on a market-determined commodity (e.g., gold or silver), and the banking system is private and competitive, neither controlled nor regulated by government.
Government is limited in its activities to the enforcement and protection of individual life, liberty, and honestly acquired property.

Missouri and Gun Regulations

On Monday, a Missouri Senate panel passed HB 1439 — the Second Amendment Preservation Act — along party lines by a vote of 5 yays and 2 nays.

The bill, previous passed by the Missouri House 110-36, seeks to render all federal gun regulations null and void within the “Show Me State.”

Borrowing the very language of Thomas Jefferson’s Kentucky Resolutions of 1798, HB 1439 declares that the Missouri Government will not grant “unlimited submission” to the federal government in regards to the natural right to own and operate arms for defense.

No sanctions against Russia

The following resolution was adopted by the State Central Committee of the California Peace and Freedom Party on March 23, 2014.

The Peace and Freedom Party opposes the use of sanctions by the United States and the EU against Russia. We support self determination for the people of Crimea and all peoples of the world. Furthermore, we call for the dismantling of NATO and the closing of all U.S. and NATO military bases surrounding Russia. All of the warmongering from Washington D.C. and the corporate media is at a huge cost to the American people whose needs have been neglected far too long.

Our Dream

To celebrate the birth of Martin Luther King, Jr. we must really analyze some facts that made people uncomfortable. On April 4, 1967–exactly one year before he was killed–at the Riverside Church in New York City, he gave his seminal speech: “Beyond Vietnam–A Time to Break the Silence.”

Dr. King’s saidin just this one speech:

So, decades later those “giant triplets” have grown to be massive, greedy destroyers of nations, communities, and families. Reading the speech that criticizes the very foundations of the Capitalist state one can easily see why he became a marked man. Dr. King stepped outside of the acceptable boundaries of polite protest and crossed the line to radicalism for truth, peace, and justice. Many parades honoring the legacy of Dr. King have been turned into jingoistic displays of militarism and support of The War Party which is appalling to say the least, and feeds those “giant triplets,” instead of opposing them as King’s life did.

Exactly 36 years after Martin Luther King, Jr. was assassinated, my own son Casey was led to his death by those evil “giant triplets” in the racist war for Empire in Iraq. I feel connected to the King family in sorrow, but also in our twin commitments to the sacred triplets of truth, peace, and justice. Truth, peace, and justice!

Cindy Sheehan is the 2014 Peace and Freedom Party candidate for Governor of California.