Economics & politics

WHAT FREE MARKET?

The October 10 Commonweal included three articles on the economic crisis, and they were unanimous in assigning blame: “the perversity of market ideology” (“The Fall,” by William Pfaff), belief in the “god of free markets” (“After the Meltdown,” by Charles R. Morris), and “free-market ideologues” (“Government Is Not the Problem,” by Jeff Madrick). That seems too simplistic. As the editors of the Washington Post recently wrote (“Is Capitalism Dead?” October 20), “The market that failed was not exactly free.”

The following features of our “not exactly free” market may have contributed to the crisis: a central bank authorized by the federal government to create money out of thin air and set below-market interest rates; a federal tax code that penalizes savings and encourages mortgage debt; and government-sponsored entities, Fannie Mae and Freddie Mac, licensed to package risky mortgages into debt securities with an “implicit” government guarantee (which has since been made explicit).

Those market distortions encouraged risky behavior that likely would not have occurred in a truly free market. One could also argue that they contributed to increases in income inequality.

That is not to suggest that the market should never be regulated or that additional regulations could not have prevented this crisis. But government intervention in the market can have disastrous unintended consequences, and to blame “free markets” is an oversimplification. The solution cannot be reduced to a battle between free markets and more regulation; rather, it is a question of reforming the regulatory framework we have into something more effective, whether that means adding new regulations, eliminating old ones, or both.

TIM O’REILLY
New York, N.Y.


GIVING SHELTER

Anathea Portier-Young’s timely, thoughtful essay, “Our Community, Our Choice” (October 10), resonates with my experience as a hospital chaplain and spiritual mentor. The stories of women who are faced with an unanticipated pregnancy and who have an abortion tend to reveal both their fear and their isolation. Such women feel alone when they are afraid they will be rejected or punished. Reflecting on Portier-Young’s essay, I think about Mary’s unanticipated pregnancy as a teenage girl. Her culture and faith community would have judged her harshly, isolated her, and probably even stoned her. God’s intervention through Joseph and Elizabeth, however, provided loving relationships to support Mary during that difficult time. While in Bethlehem on her due date, Mary was denied both friendship and hospitality from both her faith tradition and local acquaintances. Once again God seemed to intervene, providing a safe place for Mary to deliver her baby and to receive support from poor shepherds.

Maybe when God’s people are willing to take in all women with unanticipated pregnancies there will be no need for isolated and frightened women to turn to abortion—a deep wound that remains with them forever.

DEE WARNER
Durham, N.C.

 

HOMECOMING

After being away from Commonweal for a couple of years, I received the October 24 issue, and found great comfort in it. A local pastor had recently invited me to join him in giving classes on “voting as Catholics.” Those seminars made me feel as if I were a stranger in this church. But I am home again after finding myself in agreement with every writer in the October 24 edition.

(REV.) TOM SULLIVAN
Jacksonville, Fla.

Published in the 2008-11-07 issue: 
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