Free Market Myth Collaps


Since Adam Smith Vote by year 1776 through the book – An Inquiry Into the Nature and Causes of The Wealth of Nations – which is very popular. Free market theory to be very loud, controversial and intellectual debates are fierce. Because of bustle, a thick 900 page book that sold out within 6 months.

The book is a Magnum Opus Smith elucidate the laws of explaining the consequences for the welfare of how to achieve. Through the book is the variety of ideas presented by Smith, are the ideas about wealth, the division of labor, human nature, market mechanisms and understand liberalism itself.

Actually there are not too Genuine from the thoughts of Smith. For the debate-debate that he is up there much earlier, namely in the classical period. That is the reason Karl Marx, the enemy topnotch Smith when he taunt thinker Adam Smith as an economic classic. Because many of the thoughts of Smith-thought in it. Then what strength of Smith? The strength and mark important inception construction of a new mindset and praxis economy is Smith is able to create an economic system. That is later known as the sect market economy and put the name in the row of big thinkers of the world economy.

Sect Market
If Sawyer be thought Adam Smith, will be found that the birth of the free market of ideas or the market economy is rooted from the meeting with Smith mercantilism. Mercantilisms itself comes from the root word that means the merchant “traders”. Thus, in view of the nation mercantilisms, each country is eager to move forward should make trading with other countries. Mercantilist believe that the world economy remains stagnant and property, so that a nation can only be developed with the expense of other countries. Consequently people mercantilism create monopole created by the state and supports the policy colonialism.

Thoughts such as this is not approved by Smith. Not only did not agree, but he views the war with a nation like mercantilism it. A Scottish economist for the views mercantilism will only generate prosperity and profits for producers and the monopolist only. Therefore, according to the father of modern capitalism is all the things that caused obstacles in the trade for the two countries will reduce the ability of both countries for the production and therefore obstacles that must be abolished. That is the basic views about zero tariffs and taxes, which consists of countries for industrial products across the country, which is Smith micro thought that the policy made by the International Monetary Fund (IMF) and ratified by the countries members of the IMF.

Adam Smith for the government or the state can not intervene in the economy. This can be photogenic, for example from Smith’s statement “let alone running the economy with reasonable without government intervention, there will be a hands not obvious (invisible hands), which will bring the economy of the poise (Equilibrium).” Clear from the statement, government intervention in the economy for Smith will create market distortions and inefficiencies.

Thoughts about freedom is a core of the sect market economy. Well mark a revolution in the modern economic system that is built from the values (1) freedom (freedom), (2) self-interest (self-interest) and (3) competition (the competition).

Market economic system that is taught by Smith has become the model of the majority of developed countries such as Europe, the United States, Japan, China, South Korea, Taiwan, India, and Singapore. The teachings of production and growth from Smith so visible in the current economy of China. China’s case is evidence of how important the changes that occur quite terrible in the ideology of China’s economic strength up to be another post, USA and Japan. The analysis provides ions if the growth rate 9% consistently, then 20 years in the future China will rival or even surpass the economy of the USA.

Free Market Myth fall
Shown by the development of the country with the belief the market economy is tantalize. Because of all the countries want to provide residents. So that the poorest countries and the world’s third attempt to adopt other economic model with the free market ideology with the goal to encourage growth. Even at a certain level they call a consultant-consultant to design a foreign country’s economic model. Is not wrong, but what he is a model such to be the only approach in promoting the economy of the country.

In many cases, the growth of countries that currently do not have a good economic always smooth. Many occur imbalances and inequities that accompany economic growth. In conjunction with the free market, China is not the case with a pure free market, because in China there is still a government intervention in the conduct of the regulations actors economy of China. This can be seen from the cluster industry. So there are special areas that serve as centers of growth, economic and trade transactions. Even at a certain level Chinese government impose higher taxes to the citizens who make a purchase in the area is special.

In the last case, namely the global economic recession that the world financial markets. Again prove that there is no market that is really happening in perfect competition. Sub-prime market fall has a large ripple on the banking and finance globally while the economic growth during the last decade. So that is very embarrassed by the USA government must contribute 700 dollars million United States to prevent the continued financial crisis that will tear fundament-economic fundament USA. Why the USA is an economic market is now not let the economy, as confidence in the sect market economy there will be no hands to make it obvious that balanced? Why not wait until there is Equilibrium?

The financial crisis that the world this year is not the only evidence that the free market is not the best at the same time demolish myth that the market economic system is a creator of prosperity. Economic model such as that will only bring economic jungle, who is strong that he will win. There are a series of other cases that occurred since the year 1907, 1932, 1945 – 1948 (the second world war), 1974 and 1998, the period is a very difficult period and at the same time reflecting the failure of this economic model, albeit in a relatively even growth.

Free market model has delivered a handful of the richest people in the world and at the same time creating holes that gape wide between rich and poor. And this is a failure of the free market to create prosperity for mankind in the face of this earth. Survey proves that the market economic system has caused a terrible pandemic of poverty and death for mankind. They experienced hunger, malnutrition and food consequences of their poverty. Word Institute for Development Economic Research concluded that 1% of men richest in the world have 40% of the wealth, and only 10% of the world’s population, which has 85% of total assets the world.

Finally free market is only myth and therefore he has failed to create economic prosperity that is more fair for humanity. For ETHIC aspects and principles of justice that should be ignored economic enthusiasm.

Iklan

Tinggalkan Balasan

Isikan data di bawah atau klik salah satu ikon untuk log in:

Logo WordPress.com

You are commenting using your WordPress.com account. Logout / Ubah )

Gambar Twitter

You are commenting using your Twitter account. Logout / Ubah )

Foto Facebook

You are commenting using your Facebook account. Logout / Ubah )

Foto Google+

You are commenting using your Google+ account. Logout / Ubah )

Connecting to %s