In public policy we use the word ‘market’ in radically different ways and in fundamentally inconsistent ways.
For the liberal (or if you prefer, neoliberal) the word ‘market’ is used to describe a special kind of human interaction – the ‘free exchange of goods or services at an agreed price’. The beauty of this liberal vision lies in the market’s seemingly magical ability to achieve three wonderful things at the same time:
- It is a place of freedom – free individuals come together to bargain and exchange
- It is a place of community – people make promises to each other and bind each other by contracts
- It is a place of productivity – time, energy and money flow into the places which have the most value.
- The starting point is not fair, and advantages accrue to those already advantaged, and so freedom turns into exploitation.
- When relationships of power are radically unequal then the community we create is atomised and elitist.
- The most productive is not always the best; commerce can destroy nature, community, industry and even politics itself (as we are finding out to our cost in the UK).
Thus economics becomes the measure of man, not man the measure of economics.
Of course there are those who do not worship the market. These anti-liberals include socialists and conservatives. This may seem a surprising alliance and we often forget that there used to be a very different kind of conservative (small c) philosophy – one that valued King, country, religion, the local and the small. But this kind of conservatism now has nothing to do with the UK’s Conservative party. The Conservative party is now the leading ‘liberal’ party and it is no longer in the business of ‘conserving’ anything at all – except perhaps the interests of the rich and the powerful.
The anti-liberal thinks of the market not as a space but as a force:
- The financial market is a malevolent force selling fraudulent products or gambling with our savings.
- The housing market is crazy bubble where our own greed drives up prices to the benefit only of those who can escape it at the right point.
- Markets drive the growth of monopolies, big business and the industrialisation of almost everything – markets even seem to kill the possibility of markets.
Until the 1990s the battle between the liberal and the anti-liberal was largely fought on the margin of the sphere of public services. Markets were for private goods and services; when it came to public services it was the state that was in control. There was a disagreement about what should be nationalised and what should be left free – but no disagreement that nationalisation meant – ‘outside the market’.
But this has now changed radically. Today it is quite common to hear people talk about markets for public services: the social care market, the healthcare market, the market for social housing. However these markets rarely have any of the qualities that the liberal associates with markets. It is not people, making free decisions, who buy these services – it is commissioners or governments. Here the word ‘market’ takes on a third meaning – roughly – ‘the stuff we spend public money on’.
So we are left with three entirely different and contradictory meanings for the term market:
- A space within which free, contractual and efficient exchanges can take place – the idealised market
- A force which can redistribute, steal or exploit resources and power – the demonised market
- An array of objects, services or products, perhaps purchased by the state or its agent – the phoney market
Today these place will not just be physical – they will also be virtual – but they are essential. Without the agora we cannot be fully human.