Why Oh Why Can't the Media Distinguish "Free-Market" and "Relatively Free Market"?

What is a free market? It´s not an easy question.

Consider, for example, the question about the "size" of State. Most people I know connect the size of state with the level of taxation. But I think it's most important to know the kind of intervention that government pratices.

When Sachs wrote from Scientific American that "Austrian-born free-market economist Friedrich August von Hayek suggested that high taxation would be a "road to serfdom," a threat to freedom itself", he makes the same error.

One of the things you are taught as an intellectual on the cultural left is the 'limitations' of free markets. In fact, you are taught about the limitations before you actually learn what are the virtues of free markets. In fact, to be blunt, you are taught only about the limitations - somehow you never get round to Hayek's insights about information.

So there is a cursory nod to markets being necessary, then a huge discourse on how markets should be 'managed' for the general public benefit. This usually means trying to stop them from acting as markets, in particular trying to prevent altogether the (creative) destruction intrinsic to markets.

This was my experience in a couple of decades as a leftish intellectual, including three years of formal professional association with a bizarre anti-market academic group that is very powerful in the UK called Health Economists, who are actually more akin to accountants. They come (mostly) from York University, and function as technocrats and number-crunchers for the National Health Service.

Bruce - well said.

I believe that we would be wise to draw a clear line between the "free market" and everything else. The free market consists only of value for value transactions which are freely entered into. All the rest is social layering. Drawing such a clear line would allow us to place the credit and the blame appropriately.