(2008 Feb blog post)

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This page on Kudlow's flawed idea of
'unbridled free enterprise' being all-good

'Free Enterprise' is NOT a Cure-All Larry Kudlow repeatedly drills into the audience of his CNBC shows on the U.S. economy --- 'The Kudlow Report' and 'Kudlow and Cramer' --- (circa 2007-2008, and beyond) the following quote. "Free market capitalism is the best path to prosperity." Kudlow repeatedly drowns out any of his guests who would suggest that there needs to be some umpires and referees in the U.S. business scene. It is well recognized in every sport --- baseball, football, basketball, soccer, rugby, tennis, lacrosse, field hockey, boxing, jiu jitsu, karate, sumo wrestling, ultimate fighting, etc. etc. --- that there need to be referees/umpires/line-callers and the like to make sure that the games/competitions do not degenerate into an ugly mess. Apparently Kudlow thinks the same does not apply to the business world. Somehow he thinks that business persons can police themselves and have impeccable ethics. I actually heard him say once on one of his shows that he believes in business ethics. BUT ... he apparently believes that the business world will observe ethical behavior with no oversight. BUZZZZZZ ... WRONG! We have only to look in the newpapers each day to see repeated examples that demonstrate that business people are going 'out of bounds' all the time. Examples: The 2007 subprime mortgage crisis, which was precipitated largely by lenders encouraging people to buy homes that the lenders knew these dreamers could not afford --- especially when adjustable-rates of the mortagages the lenders were selling took a quantum leap upward. AND, on top of that, these lenders were packaging up these extremely risky mortgages in bundles, and foisting them on U.S. and foreign government mortgage holders, essentially dumping these risky mortgages on U.S. taxpayers --- while the originators enjoyed their gains in the Caribbean or their new 10,000 square foot houses. CEO's, in cahoots with their CFO's and boards of directors, devising ridiculously excessive and/or undeserved compensation plans and severence/retirement plans --- including the back-dating of stock options. Richard Grasso, ex-CEO and chairman of the New York Stock Exchange, is a particularly outstanding example. more examples (and cartoons) to be added.

BOTTOM LINE: The business community needs oversight by line-callers, umpires, and referees --- just like all the sports do. 'Free enterprise requires oversight --- because of the temptations that lure about 30% of the citizenry.' A more truthful Kudlow's creed would be "Free market capitalism is the best path to CEO prosperity." A more forefathers-worthy saying would be something like "Competition, with responsibility shown to the general citizenry, is the best path to a strong and civil country." The latter is more like what our founding fathers (and mothers?) had in mind. Without competition and oversight, 'free market capitalism' results in a race to the bottom, achieving the opposite of a strong-across-the-board society and a civil-to-each-other society. If Kudlow's idea of 'free enterprise' were allowed to proceed unbridled, we would find the Grand Canyon and other national parks full of billboards and mining companies. There are other things in life to be valued --- just as much as 'free enterprise' and 'free market capitalism'.

Bottom of this page on blog topic Kudlow's Flawed Ideas on the Free Market Cure-All. To return to a previously visited web page location, click on the Back button of your web browser, a sufficient number of times. OR, use the History-list option of your web browser. OR ... < Go to Top of Page, above. > Or you can scroll up, to the top of this page. Page history Page was posted 2008 Feb. Page was changed 2009 Aug 23. (To facilitate better printing) Page was changed 2013 Apr 23. (Format was changed slightly) Page was changed 2019 Mar 21. (Added css and javascript to try to handle text-size for smartphones, esp. in portrait orientation.)