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From:
[log in to unmask] (Roy Davidson)
Date:
Fri Jul 27 08:27:25 2007
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I would agree with Leonard Liggio's review of "Rethinking Nineteenth-Century Liberalism" as far as it goes. But I would suggest a couple of important supplementary aspects to the free trade principle as briefly stated below-

FREE MARKET ANTI-STATISM

A free market (sometimes referred to as free trade) has not been adequately delineated. It means much more than lower tariffs or less protectionism between nation states. In essence, it means that buyers and sellers, exchangers of goods and services, can proceed without intervention or hindrance from any outside party. It applies to economic activities of individuals, businesses, and organizations both within and between national boundaries.

IN PRAISE OF THE FREE MARKET

The free market is the wonder of the world. Millions of transactions for products; goods, merchandise, commodities; take place continuously from across the street to across the continents. These are peaceful, voluntary exchanges, usually through the medium of money, in which there is a perceived mutual benefit. There is an old cliche which is worth considering, that "where goods do not cross boundaries armies will."
In the long history of mankind, what has clearly distinguished the human from the animal is trading, exchanging, or buying and selling a variety of merchandise. The development of markets has mirrored the progress from barbarism to civilization.


UNDERMINING THE FREE MARKET
Both on a national and local level, there are many ways in which legislation interferes with the markets. Following is a list of most (but not necessarily all) political intervention in commerce or trade.

taxation

tariffs

quotas

subsidies

embargoes

licenses

patents and 

currency manipulation.


FREE MARKET OR THE STATE
The state was born in force, plunder, and exploitation. It may be defined as an attempt by a cabal to establish a monopoly of coercion and retribution over a specific geographical area. Once established, its most essential function is the use of the political means rather than the economic means by which some are enabled to obtain the wealth produced by others.

It cannot be denied that there are degrees of deviation from free market principles. More enlightened states have allowed some autonomy to the "body economic." But even the least interventionist states exhibit a mere caricature of free trade or free markets.


THE BEDROCK OF STATISM
Take away all the methods of undermining the markets such as taxation, tariffs, subsidies, licenses, patents, etc., and there are still two major impediments to their efficient operation. They are


LAND MONOPOLY
MONEY MONOPOLY

Historically, land-grabbing and the bestowal of land titles is coextensive with the growth of state power. Favoritism, corruption, and fraud are the invariable concomitants of property in land. But "ground rent seeking" which represents the actual or anticipated (speculative) yield from ownership of land works counter to the operation of free markets. The landowner can, and often does, get rich in his sleep. He is rewarded for the unproductive effort of holding, which may be for decades. The seller of goods, merchandise, commodities (i.e wealth) must find customers fairly promptly or end up with losses and sometimes bankruptcy. For details of the process see the link-POLITICAL ECONOMY PRIMER-below.

Despite the paeans to "free enterprise" and "free trade", the state system of land tenure and the state imposed money monopoly inexorably leads to increased statism. The state and the free market are irreconcilable.


Roy Davidson


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