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427: A Libertarian Perspective on the Market Economy
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I have frequently described myself as most aligned with libertarian thought when it comes to my own politics. In terms of the economy, libertarians believe in the concept of a free market.
Libertarians argue that a truly free market fosters prosperity, innovation, and individual liberty. But that doesn’t really describe the American economy, does it?
Over the years, the American economy has seen a proliferation of regulations at the federal, state, and local levels that have significantly constrained economic freedom.
In addition, governments constantly intervene in the economy through corporate subsidies, bailouts, and preferential treatment. You don’t need to look further than the recent regional bank bailouts to see that.
Libertarians would argue that such intervention distorts market incentives and motivations. For example, how are banking practices going to change for the better if the bankers know they are going to get bailed out if things go wrong?
Does a truly free market even exist? I don’t know of one. And perhaps the ruthless nature of the free market is one that we wouldn’t truly find appetizing anyway.
However, there is no doubt in my mind that a “freer” market would do the economy some good. My guest on this week’s Wealth Formula Podcast is from the libertarian think tank, Cato Institute, and explains how government market intervention has hurt us and how it will continue to do so if policies do not change.
Show Notes:
04:29 What is the Cato Institute?
05:32 The Market Prices Are Under Siege
08:00 How Do Market Prices Provide Value For the Economy?
11:45 Inflation VS Price Spikes
16:52 Is the Central Bank Policy Misguided?
19:11 Are We Hitting the Inflation Target Soon?
25:13 What Could We Be Missing That Would Keep Inflation Numbers High?
28:13 How Will the Election Affect Decision in Policy?