Let me preface this by saying that democracy holds no mystical sway with me. Like Lord Acton, I believe liberty is the highest political end. Nevertheless, democracy is well regarded by great numbers of people. Among these democrats and Democrats, often the free market is not so warmly embraced. Few things are more democratic than the free market, and so I find this lack of feeling for it by those who claim to support democracy rather contradictory.
One may question my conclusion that free markets are democratic. Fair enough, allow me to explain. Dollars (or Euros or Pesos or what have you) are votes. Each of us who has money engages in trade with markets of some sort, and we vote with our Dollars for various products. Goods and services that don't get enough votes disappear, whereas goods and services that get large numbers of votes not only stay but tend to become more pervasive.
There may be complaints that this democratic free market is unfair, because some have more votes than others. Perhaps, but the remedy, equalization of incomes, is a totalitarian nightmare which is far more obviously fundamentally undemocratic (or at least far more tyrannical). Nevertheless, those with more income are simply getting more votes for what they offer on the free market. If it is unfair, it is democratically so.
The problems we see with the market as it is now are not, as is so often claimed, results of unrestrained capitalism. Instead, cases such as Enron and WorldCom and Arthur Anderson can invariably be traced to government intervention. Regulatory agencies and elected officials making rules and regulations about what can happen in the market, restrictions upon the free market, allow these and other companies to get away with things that an actual free market would prevent. Sometimes these officials and agencies are acting on what they believe are the best interests of the people at large and sometimes it's the businesses that are expected to benefit, but that does not change the fact that it is a political corruption of the democratic process of the free market.
Left alone, the market would police itself, as companies that engage in foolishness would rapidly lose votes to other more competent companies seeking those votes. But if a sufficient minority wanted to preserve a particular good or service, they could do so, regardless of the majority opinion. A democratic process that can not only serve the majority but also fulfill the desires of the minority is a wondrous thing indeed. In fact, it's rather a rare case that anything on the free market earns votes from the majority, and to earn a majority of all the votes would be impossible(except through coercive and undemocratic taxation by the government, of course).
And so I ask all good democrats and Democrats to please work toward the goal of removing the corrupting influence of government from that most democratic of all institutions, the free market. It is responsive to minorities, it brings prosperity and the fulfillment of human wants, and it is entirely based upon what individuals choose to support. We should indeed work to spread the democratic institution of the free market throughout the world.
July 9, 2002
