Sun, 31 Dec 2006

Faith in Free Markets

Some people view libertarians, conservatives, and economists as having "faith" in free markets. I agree with that assessment, but I should explain what I mean by faith, and what I think they mean by faith. There are two kinds of faith. One kind is the faith of the blind believer. The other kind is the faith of the scientist.

The blind believer has faith in something regardless of the evidence. For example, some people believe that the earth is only 6000 years old. When confronted with the very straightforward fact that light is arriving from stars farther than 6000 light-years away, they don't lose their faith. They explain the evidence away through circumlocations such as "Well, God created the light part-way through its travel." The trouble with that explanation is that it explains anything, with no possibility of a predictive theory. If your theory predicts something, and the evidence shows something else, then clearly God must have created the evidence since their faith is unshakable.

The faith of the scientist tells them that God exists. Nobody can prove whether God exists or not, thus, no evidence can exist which might shake their faith. Some people claim that this is the God of the gaps, saying that God can only exists in-between the gaps in our knowledge. I disagree. There are many things which we have proven we cannot know. For example, given a computer program of sufficient complexity, it is not possible to prove that it will ever halt. This is a matter for faith; science can never answer this question. Yet people can observe patterns which give them cause to have faith in something based on evidence.

I agree, then, that economists have faith in free markets. We can't prove that free markets will generate a better result. But we've observed them long enough to have faith in them. We believe, with faith and evidence, that free markets provide the most prosperity for the most people.

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