To reverse inequality, we need to expose the myth of the ‘free market’

https://www.theguardian.com/commentisfree/2020/dec/09/inequality-free-market-myth-billionaires

 

Robert Reich

Wed 9 Dec 2020 05.00 EST

 

How have a relative handful of billionaires – whose vast fortunes have soared even during the pandemic – convinced the vast majority of the public that their wealth shouldn’t be taxed in order to support the common good?

They have employed one of the oldest methods used by the wealthy to maintain wealth and power – a belief system that portrays wealth and power in the hands of a few as natural and inevitable.


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Its modern equivalent might be termed “market fundamentalism”, a creed that has been promoted by today’s super rich with no less zeal than the old aristocracy advanced divine right. It holds that what you’re paid is simply a measure of what you’re worth in the market.

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Few ideas have more profoundly poisoned the minds of more people than the notion of a “free market” existing somewhere in the universe, into which government “intrudes”. According to this view, whatever we might do to reduce inequality or economic insecurity – to make the economy work for most of us – runs the risk of distorting the market and causing it to be less efficient, or of unintended consequences that may end up harming us. The “free market” is to be preferred over “government”.

This prevailing view is utterly false. There can be no “free market” without government. A market – any market – requires government to make and enforce the rules of the game. In most modern democracies, such rules emanate from legislatures, administrative agencies and courts. Government doesn’t “intrude” on the “free market”. It creates and maintains the market.

Market rules are neither neutral nor universal. They partly mirror a society’s evolving norms and values. But they also reflect who in society has the most power to make or influence the underlying market rules.

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