As for the Invisible Hand and The Wisdom of the Markets - I'd be surprised if the Chicago-ists don't privately see this as a Straussian Big Lie.
The most remarkable thing about the US economy is that it's almost entirely state managed, and has been for decades now. There are a few relatively insignificant niches which entrepreneurs can busy themselves in, and every so often there's a giga-niche like the ones filled by Microsoft and Google.
But the fundamentals of the economy, especially on the demand side at the consumer level, are subject to constant pressure from deliberate market manipulation and the propaganda which is called advertising. Corporate welfare, especially on military spending is hardly insignificant.
A reality-based map of the US economy, with clear descriptions of tarrifs, pork abd earmarks, bubbles, demand management, and military welfare, would be an interesting thing to put together.
The fundamental fallacy of this, of course, is that one cannot remove the state, since the state is, by definition, merely the gang of armed (wo)men with the monopoly on violence in your immediate environs - and violence is a natural monopoly... If one removes the Iraqi state, for instance, one does not get a "non-state" environment - one merely gets a number of statelets - the Badr Brigades in parts of Basra, Blackwater and Haliburton in the Green Zone, the Mahdi Army in Sadr City, PKK in Kurdistan and so on and so forth and etcetera.
But then again, discussing the logical and logistical implications of orthodox Friedmania is nonsense, because there are no orthodox Friedmaniacs. Whenever they crop up, they reveal themselves to be simply old-fashioned feudalists: The state should protect the privilege of the oligarchs and fuck the rest. If one can install a suitably co-operative dictator, it doesn't matter that the government budget explodes or that taxes go up - so long as they only go up for the poor and the government expenditures go towards protecting the interests of the local (or transnat) oligarchs.
- Jake If you only spend 20 minutes of the rest of your life on economics, go spend them here.
And it doesn't really matter in Friedmanism that the barrier of entry to that market is so huge that only billionaires and companies can effectively do business there, because entry costs don't matter - The Market Will Provide.
And indeed the market has provided the US with the best politicians money can buy...
But then again, discussing the logical and logistical implications of orthodox Friedmania is nonsense, because there are no orthodox Friedmaniacs. Whenever they crop up, they reveal themselves to be simply old-fashioned feudalists:
Bingo. And that's the big lie.
It's not that the Republicans want small government. What they want - genuinely - is a feudal government where there are no legal restraints on their ability to rape, pillage, plunder and abuse those beneath them.
The reason they hate liberals is because the liberal conception of compassionate government, no matter how flawed, is the only thing standing between them and their plans.
The current Palin/McCain hate fest is the true face of the feudal party. The peasants support it through conditioning and magical thinking, and as and when the party wins an election, liberals will be systematically eliminated from having any social influence. (Or possibly just eliminated, full stop.)
There is no Republican party, there's no Chicago school and there's no Christian evangelical movement.
There's only a single unified feudal party with different propaganda wings which expand a power front by leveraging the interests and preoccupations of different demographics with different imaginary manufactured narratives.
I believe that Uncle Miltie deliberately conjured the Invisible Hand from the dead starting in the late 60s and began a process of inserting the concept into the media via right wing think tanks to lay a foundation for his project of rolling back what he saw as the evils of the New Deal. It is hard to believe he took it very seriously. Did he ever write a paper or book in which he attempted to mathematically model the effects of The Invisible Hand on the economy?
Tobin at Yale mocked the Invisible Hand rhetoric. To paraphrase,(from memory): "You would think that after all these years that economists would have at least articulated the concept of the Invisible Hand to the extent that we could at least see the fingers." I fail to see how Friedman and his associates could have seen the Invisible Hand and the Wisdom of the Markets as anything other than useful propaganda to spread amongst that layer of society which tried to keep up with events by reading Time, Newsweek and U.S. News and World Report. Anyone who had ever taken a course in Economics was familiar with Smith and the metaphor. That would facilitate the process. As the Dutch said while fighting the Spanish: "It is not necessary to have hope in order to persevere."
