Impotent Markets

The understanding of world affairs that is dominant in the US is very Marxist. I don’t use this word as a term of abuse but strictly in its scholarly sense. Marxism sees the economy as the basis for everything. “At the root of everything that happens lie economic reasons,” say classical Marxists. This is imposible to prove because it’s untrue, so neo-Marxists have modified this rigid adherence to the economic causes of everything.

But the US government is a lot less flexible than even the Marxists who aren’t exactly famous for their openness to new ideas. Every administration since Reagan has conducted its foreign policy in rigidly Marxist terms. Time and again, the US government tries to solve political, military, and cultural problems through economic means. And every single time it fails. Because the economy is important. But it’s not everything.

China didn’t become democratic once it was included in the global economy. Russia didn’t develop anything resembling democratic institutions once its economy was fully neoliberalized. Four decades of economic sanctions didn’t make Iran’s military industry any less of a threat. “Markets” don’t create political institutions. They don’t change totalitarian mentality. They don’t win on the battlefield. They are powerful in many ways but not in every way.

6 thoughts on “Impotent Markets

  1. Markets are pretty good at making sure there are never empty shelves in US stores. There will be some inflation while they work out how to ditch Russia and limit their dependence on China, but you can’t have everything.

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    1. That’s exactly what I’m saying. Markets solve the problem of consumer goods. But they don’t solve the problems they aren’t supposed to solve. A Kleenex is crucial when you have a runny nose. But it’s useless if you need to make a phone call.

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      1. Consumer goods are very important for American voters, so it is difficult to see how someone could get elected who didn’t believe in markets.

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          1. On the other hand, it is equally important not to underestimate markets. As Galeev has pointed out, Russia is entirely dependent on German capital goods, but this also leads to a strong pro-Russia lobby by German capital.

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            1. This is true but I think there’s a bigger reason behind Germany’s bizarre behavior. It’s the same reason that compelled Germans to bring in a million refugees Russia sent them. They feel guilty for WWII. They’ll self-destruct to feed the guilt.

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