A common negative stereotype of the conventional “pot-smoking Republican” variety of libertarian is their condescending dismissal of anyone who disagrees with them as “not understanding economics.” Such people are so fond of firing off this rhetorical weapon that they often use it in situations where it’s far more applicable to themselves. Reason‘s recent commentary on the Pope is an excellent illustration of this kind of mirror-imaging. In an especially insufferable example of the genre, Stephanie Slade (“If Pope Francis Wants to Help the Poor, He Should Embrace Capitalism,” Reason Hit&Run, Sept. 21) chides Francis for failing to recognize that “markets and globalization have lifted billions out of poverty and lessened global inequality.”
The Pope, Slade writes, “condemns the market-driven economic development that has lifted a billion people out of extreme poverty within the lifetime of the typical millennial.” As evidence of his “lack of understanding of even basic economic concepts,” her bill of indictments includes decrying “free enterprise,” questioning the inviolability of property rights, and favoring “cooperatives of small producers” over “economies of scale.” Based on this “alarming” rhetoric, she accuses him of a desire to “constrain and regulate” the “free markets” that have done so much for the poor.
I submit that the Pope understands better than Slade the workings of the real, non-imaginary, global corporate economy we actually live in. And to the extent Slade actually believes the corporate globalization that’s occurred over the past generation has anything at all to do with “free trade” or “free markets,” she has absolutely no business lecturing anyone else about their economic ignorance.
There are things to find fault with in Francis’s economic ideas, to be sure. If he sees the corporate lockdown the world lives under as a result of “the free market,” if he believes that to free the world from the iron heel of monopoly capital requires government regulation of the market, or if he sees small-scale production as a deviation from magical “economies of scale” that requires government protection to survive, that does indeed reflect an ignorance of economics.
The truth is just the opposite. The domination of the global economy by transnational corporations is something that could never have come about through a genuinely free market. It’s a creature of top-down state intervention, through and through. And far from benefiting from “economies of scale,” giant manufacturing and agribusiness corporations are lumbering bureaucratic monsters operating on a scale many times beyond the point of negative returns on scale — and they survive only thanks to the state subsidizing their enormous inefficiency costs and protecting them against competition from smaller, leaner, more efficient producers.
The global corporate economy Slade celebrates, far from a “free market,” is the end-product of five centuries of colonialism, robbery and enslavement. Western capital, in league with local economic elites, evicted peasants from their land and enclosed it for cash crop production, and looted the mineral resources of the world. Most of the minerals, farm land and petroleum reserves of the world continue to be held by the heirs and assigns of the original robbers — a giant, bleeding, arterial wound on the body of the global South that transnational corporations feast on like vampires. So global capitalism as we know it was founded on the violation of property rights. Talk of “inviolability” amounts to the robber saying “No more stealing, starting — NOW!”
Even outside these extractive industries, the overwhelming bulk of Western corporations are absolutely dependent for their profits on so-called “intellectual property” monopolies — far more protectionist than tariffs ever were.
But Francis at least has an excuse. He’s not supposed to be an expert on economics. And if he does in fact believe all these mistaken things, they’re beliefs he shares with none other than Stephanie Slade, who does pose as an expert on economics — or at least enough of one to presume to lecture Francis on his economic ignorance.
Meanwhile Reason‘s Nick Gillespie suggests that “Maybe Pope Francis Doesn’t Understand Capitalism Because He Confuses It With Argentine Corporatism” (Hit&Run, Sept. 24). But he and Slade are the ones confusing the global corporate state with the “free market.” Sure, they’ll admit government-corporate collusion exists — but as outliers, not the defining characteristics of the system. If the Export-Import Bank didn’t exist, right-libertarians would have to invent it as an example of “crony capitalism” they could tip their hat to while still defending the larger corporatist system.
So to the extent the Left thinks opposing corporate rule and economic injustice entails opposing markets, or that state intervention is needed to restrict corporate power (instead of propping it up), it’s at fault for accepting the rhetoric of the self-appointed defenders of the “free market.” To the extent people like Slade defend corporate globalization they are — no matter how much they claim otherwise — enemies of the free market.