Streams

The End of the Free Market

Monday, May 17, 2010

Ian Bremmer details the growing phenomenon of state capitalism, a trend that he believes threatens America's competitive edge and the conduct of free markets everywhere.

State capitalism is a system in which governments drive local economies through ownership of market-dominant companies and large pools of excess capital, using them for political gain. In The End of the Free Market: Who Wins the War Between States and Corporations? Bremmer, an expert on the intersection of economics and politics, demonstrates the growing challenge that state capitalism will pose for the entire global economy.

Event: Ian Bremmer will be speaking
Tuesday, May 25 at 5:30 pm
The Carnegie Council for Ethics in International Affairs
170 East 64th Street
For more information, click here.

Guests:

Ian Bremmer

Comments [7]

David

Your guest tells you that the world has changed more in the last 18 months than it has at any time since the end of WWII, and you fail to ask him what he means. Wouldn't you like to know what has changed? I sure would...

May. 17 2010 08:39 PM
superf88

PH -- "rules of a free market" I suspect you already know that the very definition of a FREE MARKET precludes ANY rules at all! Other than outright cheating.

I suspect you and the guest also know that TODAY'S China is in certain ways the free-est market the world has ever known. Prices truly fluctuate according to the real market, unfettered by rules meant to favor the poorest, keep water clean, etc. etc.

I personally fancy an economy in which free market principles are combined with an effort to establish a "level playing field" for all players, along with laws that protect the worker, the environment, and future generations. And also square up with the majority's wishes.

But a free market that ain't!

May. 17 2010 03:50 PM
Michael D. D. White from Brooklyn Heights

Mr. Bremmer's repeated references to the absence of the rule of law make me think about the abuse of eminent domain in connections with the Ratner/Prokhorov Atlantic Yards mega-monopoly. It amounted to a state assisted corporate takeover of the courts.

The arrival of Prokhorov on the scene is an indicator that the State Capitalism rules that apply in Russia have come to Brooklyn.

Michael D. D. White
Noticing New York
http://noticingnewyork.blogspot.com/

May. 17 2010 12:37 PM
PH from Jersey City

The rules of free markets are useless if they can not be enforced effectively. If rules are an intrinsic part of the game of free markets, then you can not decouple their enforcement from the game. Therefore if rule enforcement is a failure, then so is the game.

May. 17 2010 12:36 PM
superf88

Why do you keep referring to "rule of law?" are they somehow related to capitalism? not in every definition...usually the courts are the convergence of capitalism and democracy!!!!

PS
In 1998 China and Vietnam went unscathed because they practiced state capitalism. Unlike the freer markets, those countries simply closed the borders and avoided that tsunami.

May. 17 2010 12:29 PM
Henry from Elizabeth New Jersey

How about if he demonstrates, the growing challenge that state capitalism will pose for the environment and humanity's survival?

Fidel Castro did it in 1992, and nobody paid attention to him.

May. 17 2010 11:38 AM
Phil Henshaw from Manhattan

It's extraordinary, but we are complete fools not to include a discussion of the intrinsic problem of money, that to multiply financial returns without work as expected for investment funds naturally becomes physically destabilizing for the physical economy.

There's no conceptual problem with putting ever more money into businesses to take ever more out,… when you don't ask where businesses are supposed to get those ever multiplying payments from. If you DO ask where they get it you're quickly find it comes from exploiting physical resources and inventing new ways to make those resources valuable, at the cost of staying out of conflict with others doing the same thing, and succeeding in finding ever expanding resources at lower cost.

That did in fact work great for a while, but ended as a trend over 50 years ago. Today, just about everything we do is in conflict with other things other people are doing. It’s because we got big and the earth got small.

It's a problem, that has only one practical solution. As Keynes and Boulding and others have pointed out, if investors want to have positive returns on their investments, businesses won’t remain solvent to provide them unless investors stop taking ever more out. A market finance system can only remain stable at its limits if the returns taken from business are NOT added to investor savings, to make unearned income continually multiply.

If we’re too embarrassed to talk about it we just defer to nature in how to solve it.

May. 17 2010 09:06 AM

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