Critiquing Libertarianism

This is an article that I posted on to the school student newspaper. You can read the original article here:

http://www.the-peak.ca/article/18378

Here is my response:

Timing can be a magical thing.

Two days after The Peak published Conor Meade’s masterpiece on libertarianism, in which at one point he asks for evidence of the effectiveness of government checking on greedy corporations, he gets slapped in the face by news that demonstrates the results of not enough government intervention.

First is the disgraced financier Bernard Madoff pleading guilty to 11 counts of fraud and perjury from running a ponzi scheme and stealing an estimated 65 billion dollars. Can we even comprehend that number? Why didn’t he stop at say, a billion? Did he think that was chump change?

My point is this: a free-market virtually devoid of regulation is the reason why Wall Street bankers are able to scam their way through billions of dollars. The same can be said for Ken Lay, Jeffrey Skilling, Dennis Koslowski, the list goes on, of people who took advantages of a free market and blatantly took people’s money.

Maybe Meade has been oblivious to the news the past eight months; If not, then I wonder how he can advocate for libertarianism, especially now. In case you still don’t know what I’m talking about, here: laissez faire economics is the principle cause of the current global financial crisis! Greedy bankers and in-over-their-heads homeowners alike, these people ran nuts in an economy that didn’t have enough regulation, buying and selling until they receive debt up to their eyeballs and ended up having their homes foreclosed.

Some stocks are at 20-30 year lows, hedge funds have plunged through the floor, insurance companies are broke, and there was Meade, boasting about how a free market economy is the best way to go.

Here’s the thing with being selective about examples to back up an ideological argument: Meade brings up the ‘Asian Tigers’ as a success story of free-market economics, but conveniently neglects to mention the fact that the ‘Asian Tigers’ all went down under in 1997. The real estate market in Hong Kong was so bad people committed suicide by jumping off the apartments they can no longer afford to live in.

I stuck with Meade’s piece the whole way because I felt it was important to hear the libertarian perspective. At the end of it, I gotta say, he has a point, if we were living in 1922 America.

The truth is, free-market is great if one is idealistic; but as we all know, free market gives the power to private individuals, who would then abuse this power to make more money.

As Gordon Gecko said on the film Wall Street, “Greed is Good”. Many people seemed to have taken this to heart. But as the comedian Craig Ferguson puts it, “greed is NOT good! Greed is not the friend of capitalism, it is the enemy of capitalism!”

Of course the opposing argument would be something like “but politicians are corrupted and abuse their powers too!” Yes, they do. That’s why we vote them out of office when they do (basically why the Liberal party is where they are today). But we can’t do anything to corrupted businessmen, unless we catch them and put them in jail. Until that happens, we’d still be bailing out CEOs who would then reward themselves with insane bonuses.

Here is why an unregulated market doesn’t work. As far as economics goes, I would agree with Thomas Hobbes in thinking that humans are self-interested in their nature, which means they will try to make more gains any chance they get.

A privatized nation would be one driven by profit. Do you really want the fire department to ask “cash or credit?” before they come to your rescue?

There’s the thing about taxes. I’m going to try to break the myth that is that countries in Western Europe pay way more taxes than we do. The truth is, they don’t. In France, the average family between ages 18-26 with two children pays an income tax of about 22 percent, compared to one in America, who would pay about 19 percent. But look at what the French are getting from their taxes: Free health care, almost-free childcare, no tuition for any college or university, and unlimited sick days with full pay! The truth is, Americans (and Canadians) hate paying taxes because the money is lost not being well spent (wars, stupid projects, etc.), but that doesn’t mean that government intervention doesn’t work, as seen in Europe.

I wasn’t too surprised when Meade brought up Milton Friedman, as any libertarian would. And I would dutifully bring up John Maynard Keynes, who helped rebuild post-WWII Europe, with the creation of the Bretton-Woods system and subsequently the Marshall Plan. These massive government-sponsored programs helped set up the reemergence of capitalist markets. Keynes has influences on many renowned contemporary economists, including Paul Krugman, who believes that the government should play a vital role in turning this recession around.

During the Republican primaries, I developed great respect for Ron Paul for standing up amongst his fellow candidates to be a true conservative. But if America follows his ideas, then they would let all the automobile industries, even the insurance companies, to go bankrupt, causing millions to lose their jobs and even more to lose their savings.

I don’t want to be painted as a ‘progressive’. I believe that free markets with better government oversight are the best way to achieve a prosperous economy. I understand perfectly where the libertarians are coming from, and why this ideology is no longer compatible with our society, and why there’s still only eight of you.