Free Market

To start with I recently read Adam Smith’s The Wealth of Nations and it had a bit of influence on my view of the economy. I disagree with his lassaiz-faire approach, although it is understandable in the context of his time. In the 18th century government was for the wealthy by the wealthy or their proxies, all laws were designed to maintain the wealthy as a small number and improve their wealth. No protection for the customer and certainly no free market. Smith constantly rants against the corporations and their market manipulation. They destroyed small enterprise and ensured laws that amounted to slavery or indentured service. Big business is the biggest threat to a free market and democratic government is the only cure.

I don’t remember which of Winston Churchill’s books it is in but he claimed labour and capital were both threats. Not only to the established order he was part of but to democracy itself. Democracy can not give in to either side if it is to survive. We live in a period where the threat from labour is at its lowest since feudalism, ever decreasing wages (in purchasing power) and out sourcing has labour almost defeated, at least at the lower skills level. We live in an era of increased threat from capitalism, the last great ism democracy needs to defeat. Capitalism is highjacking our democracies from within, co-opting our leaders and parliaments and rewriting the rule books of how we can govern ourselves. The language of democracy has been redefined in a ‘new speak’ sort of way.

Capitalism has a different name when it becomes a political system, fascism. Franklin Roosevelt warned us of it in the thirties and Eisenhower warned us in the fifties. Now we identify fascism as democracy, we have international institutions that help corporations weasel out of pay taxes and adhering to democratically produced laws. We are forced to respect a company when it violates human rights, pollutes, produces toxins or destroys the local economy for a short term profit. Labour is supposed to be ‘grateful’ for a pathetic low paid job. Under New Speak free market has become defined as ‘what’s good for billionaires is good for all’.

With the increased poverty in the world we decrease potential customers. If you think logically and reasonably you can not drop wages below the cost of food, shelter, heat, clothing and basic transport. People need to be able to raise a family on their wages, that means time as well as money. Forcing wages lower only reduces the pool of available labour and the pool of available customers. That is why a minimum wage is needed. It must be tied to the basic costs of survival. By the way a for profit medical system makes a society uncompetetive in the global market place hence why medical costs aren’t mentioned above.

We are destroying the economies of billions of people for short term unsustainable profits. We put our security and safety at risk with every passing day of unchecked, ungoverned capitalism. A nation that has its resources raped, its people starving and its environment/economy ruined is fully justified in making war on those responsible. We are back to a kind of mercantilism where the colony is a market and a cheap source of raw materials. Canada has become just such a colony again, Africa can never seem to escape such degradation and many other parts of the world are being assigned to one of three empires; America’s, Europe’s or China’s.

What we need now is a political solution, passed by parliament and enforced by a set of institutions with authority to dissolve corporations, seize assets, and imprison officers of the companies convicted. We need a return to democracies economy of free enterprise, family businesses and cooperation where needed and desired. A free market that is flexible and ever changing to the changes in society and circumstances. Environmentalism as the fundamental foundation of sustainable profits. An economy where the customer comes first and the corporation that sees them as just a source of revenue fails and closes. Globalization where surpluses are traded, where exploitation is replaced by developing new markets to sell our surplus. A failed Africa is truly bad for business, all those millions of customers with out the means to buy Canadian, disgraceful eh?

My suggestion is a free market act that limits the size of corporations and the ability to control the market. Incentives to keep an industry or a service from being monopolized combined with a total forfeit of all assets of an offending company. Parliament would decide what to do with the assets which would go a long way to eliminating our debt. Companies could merge under ownership but would be obligated to have the divisions compete as if they were owned separately. Any company could start up in Canada but not by buying an existing company.

Part of this act would be a unilateral free trade program for Canada. Only tariffs on subsidized goods and services would be levied. This would be combined with a Canada first government expenditure policy but only if the business payed taxes in Canada. Merit and quality would still be the ultimate deciding factor on government purchases. No tax dollars would go to any business that didn’t provide the government competitively priced goods or services. Departments that saved money would get the same budget the next year and bonuses for those doing the savings.

To prevent dumping of commodities in Canada only supplies of a commodity would be permitted into Canada if Canada could not provide its own needs or if it doesn’t provide scarcity in the country/countries of origin. This is some what protectionist but this part would only kick in if the Competition Agency appointed by parliament deemed a practice to be dumping or a threat to the nations sustainability in that commodity.

Labour standards for domestic and imported goods and services would be enforced. A living wage would be calculated by civil servants in every country we do business with. If the company is not paying wages equal to the living wage the product is tariffed as it lack of local labour laws is a subsidy. The money from these tariffs goes directly to the Canadian International Development Agency to be spent in the country of origin.

Domestically family owned business could enter into informal agreements to assist each other without the act causing them problems. If a complaint is lodged with the Competition Agency leads to a violation fines would be levied to correct the situation. This would only be a factor if competition was being limited, if prices were fixed or laws were being evaded.

The Competition Agency I mentioned would be a federal agency for the preservation of the free market. This agency would be mandated to protect the national interest, the citizenry and the environment. It would have full use of the RCMP to enforce its implementation of federal and provincial legislation. The provinces and First Nations communities would be able to appoint members of the executive board and have it answer to legislatures when it dealt with local matters. It would have the ability to spy on domestic economic activity with permission of a judge.

An Economic Intelligence Agency should also be set up with one arm of it gathering information of foreign economies, another arm watching transnational corporations for violations at home and abroad and a third arm assisting the Competition Agency. The results of this agencies intelligence would be pooled with other intelligence agencies at a central analysis agency that would connect dots and look for patterns.

Companies in an industry who wished to lobby parliament or any government agency or institution would have to register all communications with all officials and politicians including a contact report detailing what was being asked for or advocated. These reports would be online for everyone to read. An industry could not pool its resources and hire lobbyists jointly as this would be collusion and all of them would be heavily fined or forfeit all of their assets. A lobbyist could only have one client at a time and would have to wait a year before accepting a client in the same industry. Lobbyists who failed to obey the one client rule, the year between like clients rule or any other rule would be receive heavy fines and a lifetime ban from lobbying in Canada.

Employees former employees and share holders of a company would be able to sue the officers and the board of a company for misuse of funds, loss of pension, receiving or giving bonuses when no profit is posted or layoffs have occurred and for human rights violations.

Labour could of course collectively bargain as that is a human right, however joining a union is an individual choice and those not in the union should not be forced to pay dues or have any portion of there pay with held for the union. No contract should be made that forced the workplace to hire union members only but if a union is in a workplace non-union members get the same pay and benefits as the union members. The union would still be obligated to protect and support an employee who was not a member equally with the members.

During strikes and lock-outs companies would be obligated to pay any and all employees who were still working or hired to work the strike 3 times the normal amount with full benefits and pension rights. Unions would not be able to strike in support as unions would be subject to the same competition rules as business thus the ones with the best record for their members would be the survivors in the market place. Essentially unions would be considered labour providers with the possibility of being the organization that hires and fires. Companies could shop around and get a more competitive union as could the employees. In a dispute the employees trump management.

My view on the free market is it should be made up of many lean and hungry businesses that feared the customer and could take nothing for granted. No protection for the business that was large, lumbering and bureaucratic or arrogant and self absorbed. In a democracy the leaders must fear the public and so should the business leaders. Companies with no social conscience or environmental record should be left to die by customers. We need a democratic oversight to help ensure this. Relying on the foxes not to eat the chickens is silly. We know economic foxes eat our chickens history is full of examples of it such as the great depression. It would be insanity to look at the record of big business over the last two centuries and believe this time they will be responsible.


One comment on “Free Market

  1. Loan holder says:

    Nice blog.Keep up with the good work!


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