Source: This piece was originally posted at The New Democrat
There is no pure free market economy in the world today. I use the term private market instead of free market and private enterprise instead of free enterprise. Any type of economy that’s subjected to taxes and regulations is not free.
Individuals in any civilized and lawful society are not free to do anything that they want. Freedom in a civilized society is the freedom to live as we please not the freedom to hurt innocent people. Even a hundred years ago, we didn’t have a completely free market. We had labor laws and anti-monopoly laws. In his article today, Richard Ebeling suggested that the U.S. had a free market economy back then. What we had was a private economy where most of the country’s resources were out of Federal hands. Roughly sixty-percent of the American economy was in private hands.
Scandinavia is a bit different. All of these countries are social democracies. Their national governments own about fifty-five to sixty-percent of the economy, the same as in Britain. The rest of their economies are in private hands. The old capitalist vs. socialist debate is exactly that, old and, I would add, dead. Because every developed and developing country in the world, Mexico for example, has some type of a capitalist economic system.
Many European countries have socialist-capitalist systems, private enterprise combined with a robust welfare state to provide insurance for people when they aren’t able to take care of themselves. They also provide services that socialists believe shouldn’t be for-profit, basic human services that everyone needs. The U.S. is a little different. We have perhaps the largest private sector in the world but with a large regulatory state and a modest safety net for people who are down on their luck.
The world is past the point of discussion of free market vs. state command and control economy. In North America, Europe, South America, and Asia we are discussing the states role in the economy. It’s no longer almost everything vs. almost nothing.
Yale University: Professor John Roemer- The Future of Capitalism
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