CrisisTheory

Moral Hazard: The Real Culprit of the Financial Crisis

HA!

Unfortunately, one of those "bad decisions" bred by living with the "saftey net" of government, civilization, the feared 'collectivist spirit', was the decision to attempt the utopian lunacy of the "free market" to regulate conduct in human society.

This (2nd) great experiment in "market fundamentalism" - the impossible belief that there ever was, is, or could be a "free market" and that such a construct should serve as the highest arbiter in the organization of society - inaugurated by Regan, Thatcher (and Deng), has collapsed of its own contradictions.

Just as the 1st great wave of market fundamentalist liberalization ended with the implosion of the international system, world wars and depression- leading the great economist Karl Polanyi to declare that humanity had forever learned the error of the utopian idea of the "free market"- so do some now claim that we have learned our lesson.

Yet the author is proof; for beleivers in the creed, only a more pure imposition of the system could have avoided the crisis; the madness of Austrians.

Profit cannot be the supreme value in social organization; governments that attempt to implant systems based on this premise merely sow the seeds of disaster.