The Committee to Nuke Elysium

Zuzu, your free market doesn’t do what you think it does. It never has, it never will. That’s why one keeps hearing people say true capitalism has never been tried. That’s because what they mean by true capitalism – the sort where everyone plays by the same rules – is incapable of happening.

One of the things people invariably do when they become rich is try to circumvent and finagle the law. They want more advantage, less risk, special privileges, higher returns, lower taxes. If their business concerns are big enough, the amount of additional profit they can make by tipping the scales in their own favor is so great that it’s relatively trivial for them to suborn officials, or try to buy elections.

I’ve seen people try to argue that the disadvantage of having successful people fiddling with the rules of the game is outweighed by the vast amounts of cash they bring into the system. This is incorrect, for several reasons.

First, if they’re grabbing off unfair advantages, others are being disadvantaged. We can’t give away those other people’s rights.

Second, corruption is often hideously wasteful. It’s like that situation with metal thieves we were talking about, where they’ll wreck tens of thousands of dollars’ worth of equipment in order to steal thirty or forty dollars’ worth of copper wiring. The loss is not their loss, but the gain is their gain, so they don’t care how disproportionate it is.

Third, if you let privilege run unchecked for too long, the tendency is for the rich and powerful to capture more and more of the total cashflow of the system, until it’s all running through a very small elite that no longer needs all the rest of the population.
When human communities fall into chaos and disorder, their default state isn’t capitalism. It’s warlordism, which is like having a bunch of jumped-up Tony Sopranos running everything for their own benefit.
Your free market is a false god. In the state of nature, there is no free market. It’s artificial, a social construct, and can only exist when backed up by law and society.