Often times it gets forgotten just why free markets are important. Free markets are the non coercive exchange of goods and services. On the contrary; every law, rule and regulation instituted by government is backed up by the threat of coercive force. What we currently live with in this country today are not free markets.
There is a partnership between industry and government. A revolving door exists between the decision makers in government and the executives in the so called private industries they regulate. Time and time again we see executives leave behind their high paying jobs to go work for the government, and vice versa. It isn’t long before they are making decisions bearing immense consequences for their former employers.
The free market system rewards those who take prudent risks and satisfy consumer wishes. Likewise those who cannot add value to the economy or take foolish risks are punished with losses. The result is a system in which only those who can efficiently please the picky consumer grow in influence. This is the magic of the profit incentive in the free market. Enter government and this all goes out the window.
There are many examples of the lines blurring between the decision makers in the public and private sector. These are just a few of the most notable examples. Perhaps most infamous is Hank Paulson who was the CEO of Goldman Sachs. Heads were scratching nationwide as to why he would leave his multi-million dollar a year income at Goldman Sachs to take a government job as Treasury Secretary. Lo and behold within a few short months of taking his post he arranges the bailout of AIG who just coincidentally happened to owe Goldman Sachs billions of dollars from credit default swaps tied to recently bankrupt Lehman brothers.
Paulson is not alone in his mischief however. Former Homeland Security chief Michael Chertoff is making millions of dollars on the new controversial naked scanning machines being purchased by the TSA.
Another example is the former head of the CDC, Julie Gerberding, who recently took a job as head of the vaccine division of drug giant Merck. Needless to say, the vaccine division of pharmaceutical companies are among their most profitable. Getting a vaccine added to the CDC vaccine list of recommended shots is worth billions of dollars. There is no financial liability for the pharmaceutical companies by the way if their product injures or kills its consumers. They are free of any liability thanks to guess who, government of course. A law was passed giving vaccine manufacturers blanket immunity from lawsuits. Free markets these are not.
Former Vice President Dick Cheney was CEO of Halliburton. Halliburton has made billions of dollars from no-bid defense department contracts while Cheney was in office.
The list of individuals profiting by the cozy relationship between government and private industry goes on and on. It is obvious that the influence of powerful officials in government has trumped the free market. Critics of capitalism should be aware that what we have currently in America is not free market capitalism, but rather a form of corporatism or fascism. It is partnership of state and private power.
The key to restoring freedom in this country is to eliminate the special interest groups in everything. Lobbyists should go packing. The revolving door between government and private industry must end.