Monday, August 13, 2007

Conservative Free Markets Explained

Via Daily Kos, we get this statement about lead in toys and cheap prices from Erin Burnett of CNBC:

A lot of people like to say, scaremonger about China, right? A lot of politicians and I know you talk about that issue all the time. I think people should be careful what they wish for on China -- you know, if China were to revalue its currency, or China is to start making, say, toys that don't have lead in them, or food that isn't poisonous, their costs of production are going to go up. And that means prices at Walmart, here in the United States, are going to go up too. So, I would say China is our greatest friend right now.They're keeping prices low, and they're keeping prices for mortgages low too.

You know what? She is right, in a very perverted manner. When the price wars in the international "free" markets rage the only way someone can underbid is by substituting, say, a dangerous substance for a safe substance if it cuts the production costs by a quarter of a cent per million objects. That would of course only be the case in the kinds of markets where there are no rules at all. It's like a poker game with no rules. If you start losing you will cheat or pull your gun out and shoot all the other players.

A properly organized market has ground rules. They include stuff like not selling people toothpaste more cheaply by using an ingredient that kills. They include stuff like not using slaves to make the products. Rules. Just like in a poker game.

But the Chinese system right now doesn't have the same rules as the American system.

But of course what Burnett said was outrageous as an ethical statement. That this probably is the summary of the ethical views of many who support "free" trade is the really outrageous bit.