• 2024-11-23 Matters of Democracy: Are we going back to Louis XIV mercantilism?

  • Nov 23 2024
  • Length: 16 mins
  • Podcast

2024-11-23 Matters of Democracy: Are we going back to Louis XIV mercantilism?

  • Summary

  • Key Themes:

    Failure of the Free Market System: Both articles, albeit in different contexts, reflect a growing disillusionment with the promises of free market capitalism. The Bloomberg article argues that the 2008 financial crisis exposed the flaws in this model and led to a decline in public trust. The Daily Caller article, through the actions of the migrant caravan, points towards a perception of limited opportunity and potential economic hardship under the existing system.

    Rise of Economic Nationalism: The Bloomberg article traces the trajectory of economic thought from the Keynesian model to the free market policies of Reagan and Thatcher, ultimately culminating in a resurgence of mercantilism. This is evidenced by increasing protectionism, government intervention in the economy, and a focus on national interests over global cooperation. The Daily Caller article implicitly touches upon this theme by highlighting the perceived threat to American jobs and resources posed by immigration.

    Government Intervention and Control: The Bloomberg article emphasizes the growing acceptance of government intervention in the economy, citing examples like the Dodd-Frank Act, the rise of ESG investing (and its subsequent backlash), and Biden's industrial policies. It suggests that this interventionism extends to social spheres as well, with governments increasingly seeking to "force behaviors" in line with their agendas. This theme is echoed in the Daily Caller article, where the incoming Trump administration is expected to implement stricter immigration controls, reflecting a desire for greater government control over borders and population flow.

    Erosion of Shareholder Value Primacy: The Bloomberg article highlights the shift away from the Milton Friedman-inspired emphasis on shareholder value maximization. This is evident in the rise of ESG investing, which considers environmental and social factors alongside financial returns, and the pushback against it, which asserts the right of governments and companies to prioritize their own interests over shareholder returns. This suggests a move towards a stakeholder-driven model of capitalism, where broader societal concerns hold more weight.

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