Abstract

Economic Bad Boys

This editorial scrutinizes the concept of the American free enterprise system driven by an overconfident model of capitalism. When Arnold Schwarzenegger delivered his peroration against faint-hearted "economic girlie men," it was an unusually seductive, even witty, appeal to a notion of free enterprise that is not just flexible but musclebound, not just robust but smackdown and not just strong but hypersteroidal. But the American free enterprise system, particularly since the Depression, has always rested on an assumption that the marketplace would be bounded by notions of fairness, reasonableness, rationality as well as efficiency. Recently, libertarian clichés and Republican oversimplifications seem to have left many people with the impression that commerce should be utterly unbounded by any kind of regulation whatsoever. But the government's role used to mean insuring that the market was free of transactions posing great risks to life, limb or cultural capital. Two things have happened in the years it has taken to convert Arnold Schwarzenegger into a political philosopher. One is that the pricing of risk has overtaken all other categories of analysis. The second thing that has happened is that the notion of the state as a monopoly of power has been under attack by antigovernment ideologues, who think the only function of government is policing a narrow range of business interests. I guess I bother to go through this rather academic rendition because I worry that the notion of free enterprise driving the he-man model of capitalism is dangerously flawed.