Tuesday, March 31, 2015


This is the first week of class for the spring 2015 quarter. I'm teaching International Political Economy (Political Science 404), where we discuss the myths and realities behind what makes our markets tick.

As we work our way through the course one thing becomes clear: We don't operate in a free market economy.

Our choices, like our lives, are governed by rules that are manipulated so that wealth is created and redistributed in ways that have little to do with Adam Smith's "laws of justice," or his "invisible hand" of the market.

As I point out in my book, the state creates the conditions under which wealth is created, especially at the levels we see today.

Who succeeds in our markets today is not determined by hard work and talent alone. Favorable legislation (deregulation? bankruptcy protections? white collar crime vs. blue collar crime penalties?), rules about what can be traded (drugs? slaves? babies?), getting access and civil rights right (women? people of color?), regular bailouts (1982, 1987, 1992, 1997, etc.), commercial treaties (NAFTA? TPP?), tax issues (tax cuts for the rich? fees or taxes?), among others, have been instrumental in determining who succeeds in our markets today.

What this means is that - as former Labor Secretary Robert Reich has pointed out - modern markets don't exist in the state of nature. They are created and managed by humans, within a man made organization called the state.

These and other issues will be discussed during lecture this spring.

A brief history of how our modern economy evolved will be the subject of my next post.

- Mark

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