Freedom and democracy

Illustrates the intersection of supply and dem...

Illustrates the intersection of supply and demand curves as the free market equilibrium (Photo credit: Wikipedia)

Whenever the US goes to war, our fighting men and women are told that they are fighting for freedom and democracy here and abroad. That is untrue. What they are really fighting for is free market capitalism and profit. Once free market capitalism and profit are established, those on the Right no longer give a darn about freedom and democracy. If the GOP cared about democracy, they would not be trying to restrict voting rights here in the US.

Humane capitalism

World map showing countries by nominal GDP per...

World map showing countries by nominal GDP per capita in 2008, IMF estimates as of April 2009. Sbw01f’s work, but converted to an SVG file instead. (Photo credit: Wikipedia)

Sweden has a form of free market capitalism which the Swedes call humane capitalism which the GOP here in the US call socialism. The Swedish version of capitalism is noted for its high taxes and generous safety net programs, but it is not socialism. Roughly 15% of Swedish industry is state-owned while 85%+ is in private hands. The Swedish system results in income leveling to a much greater extent than practiced here in the US, but the Swedish system also provides a number of benefits to the average worker. I will list some of them and let you decide which system is better, the Swedish humane capitalism or the US version I label pickpocket capitalism.

Some of the benefits of the Swedish system I wish we had in the US. Free healthcare and free education through college. A minimum of five weeks vacation every year. One year’s paid time off for the birth of each child. Pre-school care that is affordable and widely available so that women can work outside the home if they choose, and most do. Affordable housing and unemployment benefits that are not a political football. A green energy and environment policy that is determined not to foul the land where we live.

In Sweden, labor is 80% unionized while here in the US, management and the GOP are intent on destroying unions. In Sweden, labor and management work together to improve productivity and they share the fruits of that improvement. Here in the US, management has been retaining the fruits of improved productivity for the past 30+ years. Sweden continues to be a manufacturer, unlike the US, because they produce quality products that the world wants. The unemployment rate in Sweden is currently estimated at 8%.

Pickpocket capitalism

Profile of Adam Smith

Profile of Adam Smith (Photo credit: Wikipedia)

Free market capitalism, laissez-faire capitalism, Adam Smith’s invisible hand acting to create the greatest good for the most people does not currently exist. Without effective government regulation, competitors tend to merge to reduce competition, letting them raise prices, reduce supply and make more profit. For example, just look at the oil companies and gasoline prices at the pump. What we have now instead of free market capitalism is what I call pickpocket capitalism. Adam Smith’s invisible hand of the market is in all our pockets, stealing cash from incomes unnoticed, and almost invisibly. Sky high interest rates on credit cards and insurance policies that don’t cover the insured costs are two more examples of the invisible hand of the pickpockets of corporate America. Only effective regulation by the Federal government can protect us from them. The states are too small and diverse to do the job. The ultimate solution of course is to breakup the companies that are too big to fail until they are small enough to start competing with each other once again. has an interesting companion article.



PROFIT is our MOTIVE (Photo credit: pheezy)

The purpose of insurance is the sharing of risk. When you add the profit motive to insurance, you add a motive that is opposite of sharing of risk. The profit motive makes a profit out of the misfortune of others; the more misfortune, the more profit to be earned.

There are a number of human activities that do not lend themselves well to the profit motive, religion, charity, insurance, government, war and natural disasters. The GOP wants to apply free market capitalism and the profit motive to all forms of human activity. While a regulated free market and the profit motive may work well in some areas of economic activity, there are many areas as listed above where they clash with the goals that most people accept.

Self-insurers among the 1% see no need for insurance since they don’t need it and don’t want to pay for it for others in taxes.

Related articles


English: Louis Brandeis portrait, 1915

Image via Wikipedia

When I was young and naive, I believed in a lot of things like free markets, less regulation, and work hard and you’ll succeed. I worked hard and I succeeded…for a while. Then I decided to follow a different path. That allowed me to view the world from a different perspective.

Freedom does not result from free markets and free market capitalism. Freedom is the product of freedom of speech and democracy, and democracy is  the result neither of free markets nor of capitalism.

Miners used to use a canary in a cage to test for dangerous concentrations of gas. Like a caged canary, the health of the middle class is a test for the health of a democracy. The American middle class is disappearing, and American democracy is in danger.

Fifteen years ago, I began an intense study of American history. At one time, I believed that if you worked hard, you would be rewarded with some success. Those people who failed were to blame for their own failures. Over time, my views changed. Louis Brandeis was an Associate Justice of the Supreme Court from 1916 to 1939 and a great man. I came to embrace his dictum, you can have great concentrations of wealth or you can have democracy, but not both at the same time.

Therefore, anything that concentrates wealth in the 1% and harms the middle class is bad. Anything that decreases the concentration of wealth and helps the middle class is good for freedom and democracy.

Please see Supreme Court | Saving America | 3 scenarios for 2012