So I watched The Big Short the other night and it's had me thinking a lot about politics and money etc. I've always held that there is an important difference between "wealth" and "value". By wealth I mean money (or valuable assets etc), and by value I mean intrinsic value. Building a car people want or refining oil or making beautiful art etc. I've come to the conclusion that the problem with free market economics is that it is based on a gals equivalence of wealth and value. See, if everything was about generating value, then the free market as envisioned by Rand and Von Mises and others would absolutely work. The problem though is that value is an abstract/intangible concept, so we have to have something tangible to represent value, which in this case is wealth.
This is at the core of the failure of free market economics. Because one can generate wealth without generating value, or, worse, by destroying it. I'll give a few examples.
The first is financial shenanigans like those discussed in the Big Short. These were all about generating wealth without any actual value backing them up. I don't dislike finance in general, because I think it does often generate value. Giving businesses access to capital or creating market liquidity is an incredibly valuable service. But when unfettered and when wealth is the only target it is in their interest to create wealth without generating any underlying value, the ability to do this so easily is something fairly unique to their industry since they create financial tools.
A second example has to do with short sightedness. It is fairly simple to generate wealth, and even the underlying value in the short term of the long term value costs are ignored. One version of this would be environmentalism. We can chop down a forest and generate both wealth and value in the process, but the long term value loss of that in terms of biodiversity or soil erosion patterns or whatever are not looked at in the equation. Definitely not in the sense of wealth.
In both of these cases the free market actually encourages the generation of wealth without the corresponding generation of value. This is very problematic. Regulatory bodies exist to help tie those concepts back together and actually maintain a properly working free market economy, in the cases given above that would be the SEC and the EPA, two organizations that are highly maligned by many free market types.
Fundamentally this is a big problem I have with republicans as a whole. For one I don't think many of them even understand the difference between wealth and value. Consider Donald Trumps supporters. He has undoubtedly generated a substantial amount of wealth in his lifetime, but how much actual value is tied to any of it? When asked about the bankruptcy of his casinos and other ventures he (quite cleverly) riposted that he never lost a cent from those projects, in fact he profited from them. This is a clear indicator of a divorce between wealth and value, and yet the republican electorate saw it as sign of sound business strategy (which it is in a free market that doesn't tie wealth and value together).
And then there are those that perhaps do understand the difference between wealth and value, but simply don't care. These are the Gordon Gecko/Don Blankenship (and Probably Donald Trump) types. They understand the system and simply exploit it as much as possible to line their pockets. And I think that they prey on the ignorance of the first group as much as possible to do so.
And I don't really see a third option. Perhaps there are those that appreciate that while regulatory bodies are intended to tie wealth and value together to create a stronger free market, they often fail due to bureaucratic in efficiencies and idiocy. I count myself in this group. But what I don't understand is how someone with that belief could actually back republican politics which more often than not believe that the entire regulatory system is a hindrance and should be removed, which is simply not the case as there are numerous examples of success in better thing wealth to value, like the Clean Air Act. Moreover even if regulatory bodies and the regulations they enforce are flawed the solution is to keep working on them and adjust them as we go, something very few republicans ever admit to being a goal.
There are of course other good reasons to want to vote republican, social values are very personal and I understand why people put them as so important. Similarly fear of overly burdensome tax policies or "wealth redistribution" have other systems of logic behind them which may have validity.
But when it comes to discussions of the free market and regulations the Republican Party is fundamentally wrong. And since this is now a major part of the platform these days I can't help but wonder how much of the party is composed of people with severe failings in their understanding of economics, or are simply crooks. In other words, to my republican friends out there, are you a dummy or scummy?