Illusions of Free Markets


Chasing Fat Tails has an interesting post. It is a discussion of the issue discussed in the book, Illusions of Free Markets, Punishment and the Myth of Natural Order, written by Bernard E. Harcourt.

Harcourt’s book is vital and bracing reading, and once read isn’t easy to forget.  Its two central ideas, that “free market” rhetoric masks the inevitable regulation that must occur and encourages mass incarceration, start popping up everywhere once you start to look for them.  It touches on any rhetoric about regulation, any argument about prisons, and any idea that’s concerned about affecting change in either.

The argument isn’t perfect.  Those familiar with recent trends in the industrial-prison complex will already be asking: what about the steep rise in private prisons?  Doesn’t that interfere with the book’s claim that incarceration is strictly the province of the government?  (For the record: yes it does, and it’s an instance of the power of free market rhetoric that it can infiltrate a long-held province of legitimate state action).  But the intellectual history is too airtight, the relationships mapped too perfectly, to dismiss.

I share the author’s skepticism about free markets and the “natural order.” To me, the natural order sounds very similar to the divine right of kings. After all wasn’t that the nature of reality in the 16th century?

Humans are not an orderly species. They vary in talent, morality, training and experience. To expect a clockwork mechanism based on an inevitable economic cooperation is the height of delusion. Yet, I encounter it everyday.

You can knock down every premise of the free market fundamentalist and it comes back like Dracula in a Hammer film.

I will write about this in more length later. Right now, I would like you to read Chasing Fat Tails and take a look at the book on Amazon. There are two more reviews there you might find interesting.

James Pilant