The Free Market – Monopolies Will TAKE OVER! (Crony Capitalism vs The Free Market)
Channel: Daily Insight
Date: 28/01/2020

In this video, I run through a simple scenario of what a true free market economy might look like. How would it play out? Imagine that all the cronyism and government intervention disappeared and the market became truly free. Pure capitalism as some might describe it, or Laissez-faire. Would this fix all of our problems? Would monopolies form? Would prices go up? Would competition be stifled? Many proponents of capitalism say that although our current system looks a little bit like capitalism, it really isn’t in that businesses with lots of money can essentially buy government favours, that is, they can “lobby” the government to give them an unfair advantage in the marketplace. This is often in the form of subsidies, grants, tariff protection, tax breaks, and so on. Whenever you hear somebody say, “The market is rigged!”, this is typically what they are referring to — so called “crony capitalism”. Technically, most of us live in what we call a mixed economy, an economic system with some elements of freedom, but one which is heavily controlled and regulated by the government. Just look at any of the tax laws in your country — they’re unbelievably complex. They incentivise some industries while penalising others. It’s certainly not a free market. In this environment, it’s only natural that businesses try to manipulate the government through lobbying, and so on, to acquire some kind of advantage in the marketplace. Crony capitalism is just an inevitable consequence of the system that we have set up.

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IMAGE RIGHTS
Noam Chomsky 2017 by Σ, retouched by Wugapodes [CC BY-SA (https://creativecommons.org/licenses/by-sa/4.0)]

OUTRO MUSIC
Fortress Europe by Dan Bodan (https://www.youtube.com/user/danbodan)