In defence of free-market capitalism, The Australian contends that European social democracies are slow to recover from the GFC because they have “interventionist” governments, unlike the US, “where open markets have assisted stability”. (“Capitalism to save social democrats from debt trap”, 25/9). This conveniently glosses over the fact that these very US markets triggered the crisis in the first place. The related suggestion that Australia survived not because of, but in spite of an “ill-considered” and “over-egged” stimulus, defies the opinions of most economists.
To maintain the view that economic problems are solved by doing nothing – in the face of massive, sustained evidence to the contrary – The Australian makes the mystical “invisible hand” into an irrefutable hypothesis: the market unerringly seeks efficiency, where efficiency is defined as whatever the market seeks, and can only fail because of interference, where interference is defined as whatever causes the market to fail.
This recursive logic leads to the prescription of more poison as the antidote.