Does the Free Market System work?

Does the Free Market System, or Capitalism, work?  Or should we do away with this system and adopt another type of sytem like Communism or Socialism, or make up a totally new market system that is fair for all?

President Obama doesn't think so:

"It didn’t work when it was tried in the decade before the Great Depression," said Obama. "It’s not what led to the incredible postwar booms of the ‘50s and ‘60s. And it didn’t work when we tried it during the last decade. I mean, understand, it’s not as if we haven’t tried this theory."

http://cnsnews.com/news/article/obama-limited-govt-preserves-free-markets-doesnt-work-it-has-never-worked

Fact checker on Obama's Kansas speech:

The data showed that the biggest contributor to the disappearance of projected surpluses was increased spending, which accounted for 36.5 percent of the decline in the nation’s fiscal position, followed by incorrect CBO estimates, which accounted for 28 percent. The Bush tax cuts (along with some Obama tax cuts) were responsible for just 24 percent.

Thus it is simply wrong to blame only the Bush tax cuts for the deficits now faced by the country, especially three years into another presidential term.

“Some billionaires have a tax rate as low as 1 percent — 1 percent. That is the height of unfairness.”
 
This is a striking statistic. But the only evidence that the White House could offer for it was a clip of a conversation on Bloomberg TV, in which correspondent Gigi Stone made this assertion during a discussion about the tax strategies that the very wealthy use to avoid paying taxes.  The TV clip was promoted by the left-leaning Web site Think Progress.

Here's the full article:
http://www.washingtonpost.com/blogs/fact-checker/post/obamas-kansas-speech-some-suspect-facts/2011/12/06/gIQAUU45aO_blog.html
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TlingitAsked:
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BigRatCommented:
Is this going to be a discussion on whether a free market works or is it going to be an Obama bash?

The link given and the excepts cited are more opinion than fact (see the commentry added to the article).

I would say that the US has never had a free market, there has always been government interference somewhere at sometime. In fact you only have to look at the history of inter-state commerce, resulting in the act of 1887, to see how the states meddled in business and how a federal agency had to meddle with the big railroads because of unfair practices.. In fact federal assistance were applied as early as 1816 (see http://www.academicamerican.com/jeffersonjackson/topics/monroeadmin.html for a good synopsis of tariffs and trade)  This practice has continued to this day on even larger scales - airlines after 9/11, steel in 2003-4, car companies and recently banks.

Considering that the US has always been able to put far more public funds into commerce than any other country in the world, carsRST statement about "greatest nation ever" is really based on government intervention socialism.

>>Does the Free Market System, or Capitalism, work?

No idea, nobody has ever tried it.
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carsRSTCommented:
>>Does the Free Market System, or Capitalism, work?

The US, in a short period of time, has become the greatest nation ever on the face of the earth due to capitalism.

There are no socialism success stories.  Never worked anywhere.



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Anthony RussoCommented:
>>Does the Free Market System, or Capitalism, work?

Agree with cars. Yes it works and is one of the reasons the US became the great world power it is.

>>or make up a totally new market system that is fair for all?

Good luck with that.

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leonstrykerCommented:
>>Does the Free Market System, or Capitalism, work?

In theory it does work, but we do not wish to deal with consequences. We do not allow total failure (poverty) or total success (monopoly). The consequences are not acceptable to us as a society.

>The US, in a short period of time, has become the greatest nation ever on the face of the earth due to capitalism.

US never practiced pure Capitalism, nor has any country in the world practiced pure Socialism or Communism.
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Anthony RussoCommented:
>>In theory it does work, but we do not wish to deal with consequences. We do not allow total failure (poverty) or total success (monopoly). The consequences are not acceptable to us as a society.

>>US never practiced pure Capitalism, nor has any country in the world practiced pure Socialism or Communism.

I believe the over arching theme here is balance. Absolutes do not usually work in most things.
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leonstrykerCommented:
>I believe the over arching theme here is balance.

Then the question should be does the fusion of Socialist programs and Capitalist theories, as practicied in the US work? To answer that we need to agree on the definition of "working". What is the criteria against which we measure? Is it GDP growth? Is it Balance of Trade? Poverty levels?
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TlingitAuthor Commented:
Is Obama serious about solving the economic issues, or is he just fiddling around?


Fiddling-20Around.jpg
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ClifCommented:
leonstryker,
"In theory it does work..."
In theory socialism also works.

The problem with both is that theory does not take in to account human greed and sloth.

"...nor has any country in the world practiced pure Socialism or Communism."
That's not entirely true, depending on how you define "country".  The very first settlements in America, particularly Jamestown was technically communistic in that all shared in their work and in the results of their work.

carsRST,
"There are no socialism success stories.  Never worked anywhere."
There's a billion or so Chinese that might just disagree with you.  (Not counting a few thousand dissidents in Tiananmen Square)
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TlingitAuthor Commented:
>>There's a billion or so Chinese that might just disagree with you.

China is not socialism.  It is still considered a communist state.

According to CIA World Factbook, China's government is still considered a Communist State. However the source does note some economic changes since the 1970s (see below). A country's economic policy is only one part of it's government, so just because economic policies are changing doesn't necessarily mean the system of government has changed.

The Chinese government faces several economic development challenges: (a) to sustain adequate job growth for tens of millions of workers laid off from state-owned enterprises, migrants, and new entrants to the work force; (b) to reduce corruption and other economic crimes; and (c) to contain environmental damage and social strife related to the economy's rapid transformation.

Full article:

http://askville.amazon.com/China-communist/AnswerViewer.do?requestId=8421289

There are still millions of poor people that live in China.

Nearly 48 million Chinese live below the domestic poverty line, accounting for 3.7 % of the total population. According to international standards, however, 135 million Chinese live below the general poverty line, or 10% of the population. China's poverty benchmark is a per capita annual income of 683 yuan (US$87), while the poverty line defined by the World Bank is income or consumption valued at not more than US$1 per day.

Full article:

http://www.china.org.cn/english/news/187251.htm

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carsRSTCommented:
China has very few regulations and is probably more capitalist than the US.  They're growing while the US isn't.  

Leon is right in that the US is not a true capitalist country.  We're losing our freedoms daily to community organizers, unions, and regulators.  
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