Is there anybody who genuinely supports the free market? That is, anyone who supports it when free market principles would forbid the bailout of failing financial institution costing one’s life’s savings or when a protectionist law would prevent the loss of one’s job? I leave aside times when one might balance other priorities against a free market purism: say, in imposing sanctions to contain or bring down a dangerous regime, the protection of public spaces from development, the interference in a free labor market through immigration restrictions and so on. In such cases, one could always argue that the free market itself requires citizens and governments willing to defend freedom and sovereignty and the market can’t do that on its own; but in my opening examples, it is the very consequences of the free market, that which makes it a market in the first place, that are negated. Of course, we may protect only one industry or bail out one bank–but the point is that if, when push comes to shove, when too many constituencies demand the repeal of market verdicts, we capitulate; which, then, means, that if larger encroachments on the operations of the market were required by an even more pressing emergency, we would surely capitulate more abjectly. Who would stand for economic freedom, in the way in which there would always be quite a few who would stand, at great risk to themselves, against some new form of racial discrimination; and if they stood, who would notice or care?
I am trying to point to a paradox here, which is that the one article of consensus holding together the free world in the post-Cold War era is meaningfully adhered to by almost no one. One might go even further and say the same thing about the Consitution, or the law–how many really “believe ” in either, as opposed to having becoming habituated to the greater probability of advantageously settling disagreement through these means rather than through violence? This, of course, is part of the genuis of modern freedom–that it works without virtue, without making unrealistic demands upon its practitioners and beneficiaries. But the case of the market seems to me to be different, or at least more extreme. We would know “where” to stand in defense of, say, civil rights: there is a courthouse where someone is being tried unjustly, a school someone is prevented from attending. But where does one stand in defense of the market–where “is” the market for that matter. It is also true that it is far more seldom that the market requires this kind of commitment–but when it does, it really does.
Perhaps it’s needless to say that these reflections are provoked by the current financial “meltdown” in the U.S., which demands some kind of response from originary thinkers, even a rank amateur in economics like myself. Part of the fascination in these unfolding events lies in the clarity of the causes behind it; and the other part in the complete impossibility of claiming any real expertise regarding how to correct what has gone wrong. First, the cause: we actually have a victimary financial crisis that, according to some accounts at least, imperils the entire capitalist system. This certainly situates the whole discussion of the victimary on new terrain! The stakes had already been raised by the victimary absolute of global jihadist terrorism, but now we have something much more benign and closer to home with potentially far more catastrophic consequences. One would have thought that affirmative action created all kinds of local, but hardly critical, injustices–a white kid who has to go to a state school instead of a more prestigious private university; an employee with 15 years experience given the same seniority as a minority employee with only 5, etc. And, of course, there is the broader, creeping corruption of the whole notion of equal rights and equal opportunity and the associated incremental encroachment of the state upon private freedoms… But this is on another scale entirely: because of the claim, promoted first of all by “community activists” like Barack Obama going back to the 70s and 80s that banks were “redlining” (who would have thought, as a reader of leftist stalwarts like The Nation and Mother Jones in those days, that these tendentious, monotonous, hysterical arguments would bear such prodigious fruit!) and thereby unjustly excluding minorities seeking mortgages, laws were actually passed mandating that such mortgages be extended by banks; mortages which then got caught up in various financial mechanisms and shenanigans which I can’t pretend event to begin to understand so that when the housing boom peaks and all those mortgages go unpaid, enormous sums of money (how much? trillions?) goes poof! Not even real money, of course, but promises of future money, which is now worthless because nobody believes the promises.
But now, what to do? I, like many others, accepted the initial dire narratives of total, imminent collapse and “got behind” the original “bailout plan.” But now, a few days later, having had a chance to be reminded of the disgraceful behavior of the Democratic majority, which continues to provide no evidence that it has the slightest interest in actually governing; becoming increasingly suspicious, not of President Bush’s intentions but of his “compassionate” tendencies which might be leading him to err on the side of inflating the crisis so as to take responsibility for it; noticing that the sky seems not to have fallen yet (while stipulating that it still might); detecting a somewhat desperate, even “it’s too urgent to explain to you idiots” bullying tone in those urging the bailout; and, finely, have seen among conservative thinkers some other, cheaper, more market friendly alternatives–now, I say no.
And then this no reveals a whole new vision of the stakes in the upcoming election (and, yes, all this is happening in the middle of a rather important Presidential election in such a way as to upset all the carefully laid strategies of both campaigns–neither of which, clearly, has the slightest idea of what to do). This election gives us a choice regarding the meaning of the events of 9/11: either that day was the beginning of the end of victimary blackmail, because we now realize that no payoff can ever satisfy the blackmailer, because each payoff simply confirms the original and incommensurable guilt of the the extortee; or, in some hazy, not quite explainable way, all the bad things that have happened since 9/11 (sliding over imperceptibly into 9/11 itself) are the fault of the Bush Administration and therefore, once that scapegoat (and everthing associated with it) has been sacrificed, all will be right again. Back to the prior status quo in which we perpetually negotiate the terms of blackmail based on the fantasy that a final settlement is just within reach, and less and less incentive remains not simply to jump over to the side of the blackmailers. This is why Obama, in his final, extraordinary and yet unremarked upon, remarks in his first debate with McCain, provided the following criteria for determining the rightness of American policies: prospective immigrants from Third World countries must find them inspiring. That McCain didn’t seem to even notice this bizarre combination of triviality and teachery filled me with the closest thing to despair I have felt in a long time.
John McCain seems capable of thinking of himself, as a public figure, only in terms of “saving the country.” That’s fine–a president can have worse ways of imagining himself. But he has to choose between two versions of this attitude: one, “saving the country” from what may very well be exorbitantly inflated claims about the danger we are in, which will mean covering up, in the interesting of brokering a bi-partisan deal, the deep implication of the entire criminal cult that goes by the name of the Democratic Party in that crisis; or, he can join the Republicans who were either immune to or have snapped out of that hypnotic stance in which one simply insists “we must do something,” and have regrouped around the more salutary “no, instead I think we’ll just stand here for a while,” and ruthlessly, obsessively virulently, rub the faces of the Democrats and Obama above all in the consequences of their decades of, in essence, “laundering” the ideological currency of victimary blackmail–and, in that case, he just may have a chance of saving his country from an Obama Presidency and Democratic control of both houses of Congress and what will be a veritable riot of the Left which is still in a scapegoating mood and has been busy painting targets on the backs of their enemies.
OK, I’m not sounding very “disinterested” myself, am I? But I think I may have located where one “stands” in defense of the market–against every law and every employment of governmental power that gives anyone in the government any interest in who wins in the market place or, for that matter, increases their ability to predict who will win. Doesn’t the rush to scapegoating result from the selection and promotion of preferred winners, with the subsequent skewing of the market place, upsetting of values and suddenly visible and unseemly ties btween the winners in politics and the winner in the marketplace. Right now, there is someone out there with an idea for how to get super-rich by cleaning up at least a good portion of this mess and redistributing values more productively. And none of us could have any idea who that might be or what that idea might look like. My own criterion for any governmental action in the meantime is that they not do anything that gets in his (or her!) way. In the meantime, the public itself seems to be on the side of distinerest–let them sink! seems to be the general idea. Some principled and clever politician might use this event to paint all government interference in the market place as being not only against the interest of most of you but a first step towards a calamity. But first the opposition to the bailout must become increasingly determined, unified and articulate.