Australia’s commentariat is thickly populated with right-wing guardians of the doctrine of free markets. Many of them have been groomed by right-wing think tanks in a long-term campaign to drag our perceptions to the right. Chris Berg and Sinclair Davidson, of the Institute of Public Affairs, are regulars on the ABC’s The Drum Opinion. The campaign has been highly successful, as the free market mantra has taken over both sides of politics and dominates economic discussion.
However it is very easy to demonstrate the doctrine is hopelessly wrong. The evidence is clear that free markets have retarded growth. The theory underlying the doctrine is plainly and absurdly unrealistic. The Global Financial Crisis was caused by financial markets building up mountains of debt, yet debt and money are absent from mainstream economic models and, apparently, from economists’ thinking. Hence their blindness to the GFC’s approach, its cause and its remedy.
These problems will be covered in a three-part series. First, the evidence.