The free market is a myth in the US

For most, the symbol of free market economics is the US. One would argue that the free market is the defining feature of American culture. While this is certainly the perception abroad, this is certainly not the reality.

It is true that the US is a capitalist economy. However, despite what one might hear in the American news, capitalism is not a synonym for free market. Capitalism describes a situation where there are owners and workers due to the differences in private ownership. The free market describes a situation where there is an exchange of goods based on supply and demand. Occasionally, these two systems may overlap, but the crucial difference is in an extreme capitalist system, the owners may have disproportionate influence on economic policies.

This may seem like conjecture, but there is evidence for the lack of American free markets. The first is the most obvious: Buckley v Valeo (1976), which allows unlimited campaign expenditures, Citizens United v FEC (2010), later completely deregulated contributions and allowed corporations to have a large influence on electoral politics, and, some would argue, legalize bribery.

The next is the incredible amounts of manipulation of patents by pharmaceutical corporations like Turing and by large media corporations like Disney, with its famous “Mickey Protection Act” lobbying.

Then there are the so called “free trade” agreements like NAFTA, TPP, and TTIP. These agreements, far from liberalizing trade by allowing free movement of capital and workers, as David Ricardo originally said, instead allow corporations to veto governments for special privileges in secret courts. In other words, “free trade” now means rent-seeking, in a bizarre Newspeak translation. The closest example of a real free trade agreement would be the European Union (EU).

As American philosopher, John Dewey noted:

“As long as politics is the shadow cast on society by big business, the attenuation of the shadow will not change the substance.”


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