Laissez-faire doesn’t work in real world

Teri Pfeifer, Las Vegas

Monday, June 9, 2008 | 2:04 a.m.

In response to a letter in Saturday’s Las Vegas Sun (“Taxing the ‘rich’ shortchanges the economy”), Jay Carr displays historical unawareness by invoking the “L” word, liberalism, in the pejorative sense.

Liberalism is not merely a political position. Neo-conservatives, like Milton Friedman, an ideologue/apologist for conservative economic policies, trumpet liberal economics also known as deregulated, free market capitalism.

Mr. Carr mistakenly taps into the 18th-century free market mythology of Adam Smith in “Wealth of Nations” (1776) that sing the praises of laissez-faire economics with its laws of supply and demand: “Leave the market alone, and it will bring producers and consumers harmoniously together!”

The classical entrepreneurial capitalism Mr. Carr is referring to no longer exists — we are in a postindustrial information/services economy. Multinational conglomerates dominate most industries, which undermines competition for “risk taking” small-business people.

Massive tax breaks to the rich have led to the resurgence of gargantuan federal deficits. The system has provided great wealth for the few (a wealth that ultimately represents the labor of workers) while being remarkably inefficient as a redistributor of resources for the many.

One only has to look at how the rich are getting disproportionately richer, the poor poorer, the middle class fading away.

Mr. Carr’s faith in the unregulated market ignores how it incurs great environmental and social costs, as well as being unable to provide health care for many of its workers.