12 October 2008

48. Unregulated Economy vs. Controlled Economy

This is my discussion and commentary regarding how Capitalism represents complete unregulated free-markets and commerce versus how Statism represents intrusive government regulated and controlled markets and commerce. My discussion regarding an unregulated free-market economy comes first, followed by my discussion regarding a state controlled economy.

Capitalism and An Unregulated Free-market Economy

Capitalism represents:

Complete unregulated free-markets and commerce, including all business, banking, savings, financing, and investment, with NO government intervention, restriction, regulation, or control – for any reason or in any manner whatsoever.

This means, for example, such things as:

Prevention of government intervention and/or regulation of any and all commerce through a properly, objectively established Constitution.

No government “anti-trust” or so-called “predatory competition” regulation or laws allowed by a properly, objectively established Constitution.

No government “stock-market trading” regulations or laws, and no so-called “insider-trading” regulations or laws, allowed by a proper, objectively established Constitution.

Also, Capitalism represents complete unregulated free-market stock trading, with participants responsible for their own decisions and risks. (Don’t gamble if you can’t afford the risk, and investor beware – which means, investor be responsible and “educated.”) The properly formed justice system (courts) under Capitalism will take care of situations involving fraud and other forms of force.

In a laissez-faire free-market, there would exist an almost unlimited amount of choices in individual investment, savings, banking, and financial products, services, and strategies, even more than exist at present in 2008 – because a proper capitalistic limited-government would not be able to intervene, manipulate, regulate, mandate, or control the banking, savings, financial, trading, and/or investment industries at any point, for any reason, in any manner whatsoever.

Capitalism, as a true laissez-faire free-market social-political system, provides a stable, reliable, and productive financial and business environment for proper, objective economic trading and investment for both individuals and businesses.

It is Capitalism’s fundamental, unregulated, free-market economic process, with individual freedom, that prevents, guards against, protects, and defends against the occurrence of National Recessions and Depressions in a country’s economic system, while preventing economic, financial, and societal bankruptcy, chaos, collapse, and ruin. No rational and sane individuals or businesses deliberately want recessions, depressions, or any type of economic chaos, and do everything possible to avoid such conditions. And the only way to achieve the avoidance of recessions, depressions, and economic chaos is through rational individual freedom and economic freedom, meaning Laissez-faire Capitalism, where there is NO government interference, regulation, manipulation, or control.

Only Statists, and their statist agendas and policies, desire and actually create National Recessions, Depressions, and other economic chaos because such conditions help perpetuate and preserve their governmental power and control over the citizenry and the economy.

It is statist-type intervention, regulation, manipulation, and control of a country’s economy and individual freedom that creates destructive Recessions and Depressions, affecting all of a country’s citizenry, businesses, and financial institutions - with Statism ultimately causing a country’s total economic and financial bankruptcy, leading to societal chaos, collapse, and ruin. It is only Capitalism that can prevent any of this.

Capitalism creates economic harmony and stability.

VERSUS -

Statism and A State Controlled Economy

Statism represents:

Intrusive (statist) governmental regulation, intervention, and control of free-markets and commerce, including banking, savings, financing, and investment. The economy is controlled by the state (government or ruling group).

This means, for example, such things as:

Government (state) enforced Anti-trust laws and regulations are established and implemented.

Government (state) enforced so-called “stock-market trading” or “insider-trading” regulations and laws are established and implemented.

Government (state) enforced so-called “predatory competition” regulations and laws are established and implemented.

Statism promotes both public and private attempts to manipulate free-market trading and investment through government corruption, intervention, regulation, mandates, legislation, and force – thus, encouraging people to irrationally, irresponsibly, and unnecessarily risk and gamble their earned monies and productive assets.

Also, statist governments usually promise economic safety nets, large financial bailouts, and entitlements (provided through taxation, by stealing and confiscating the income, profits, and wealth of the citizenry) to the very people who were encouraged to engage in irrational, irresponsible trading, borrowing, lending, and investment practices in the first place, all initially encouraged under government intervention, regulation, and mandates.

Such government-promised economic safety nets, financial bailouts, and entitlements only further encourages more irrational, irresponsible trading, borrowing, lending, and investment practices - with the end result being that the government is expected, by the majority of the citizens, to continue to provide such economic safety nets, financial bailouts, and entitlements as part of its normal function. Thus creating a continuous, increasing vicious circle of government intervention, regulation, and financial bailouts – until, ultimately, causing a country’s total economic and financial bankruptcy, leading to societal and economic chaos, collapse, and ruin.

Observe the present day continual governmental financial bailouts of current mortgage loans and mortgage defaults occurring in the United States. This kind of constant government involvement, manipulation, financing, and bailouts cannot continue forever.

Also witness the current financial state of affairs of such countries as Canada, England, France, or Venezuela.

Statism causes economic discord and chaos.