Market mysticism and the misinformation that dudded Australia
Australia did not just embrace a market economy; He writes that he embraces the myth that efficiency alone can ensure justice, prosperity, and the common good. Dr James Schuurmans-Stekhoven.
In the modern public policy scheme, “efficiency” has been elevated from a technical economic criterion to a sacred moral virtue.
We are conditioned to take it as an article of faith that if a market can do this, it must, and that any mechanism that is slower, more deliberate, or fairer than the holy ghost…sorry, the invisible hand…is an unpleasant friction between the wheels of progress.
But this blind devotion to market-driven efficiency is not a law of nature; It is a deep and often unexamined value judgment.
A group of economic missionaries since 1980, Milton Friedman He led a so-called spiritual revival by declaring that without the renewal of the recovery market our economic end was near. Converts awakened and blessed by the spirit of market-driven efficiency, in their “coming to Jesus” moments, often fell victim to the innovation fallacy; the seductive but flawed belief that anything modern or “disruptive” is inherently superior to the stable, time-tested structures inherited from our ancestors.
Market as a value choice
“Efficiency” was enshrined: the ultimate and highest goal was the rapid allocation of resources to consumers who were assumed to be uninfluenced by advertising and always knew what was in their best interest. The reputation of the process or its effects on cultural capital were not even an afterthought.
But even if efficient, markets are not supernatural. At their core, markets are just voting systems, though they lack political equality. In the free versions, the fact that those converted to cash have more say is an immutable fact that the economic elite easily hides from the community.
In accepting markets as our primary allocation mechanism, Australians have been defrauded in two ways: the cynical asymmetric retention of this important information (which ironically even the priesthood admits undermines the efficient market hypothesis) and the outright lie that the market sanctifies all its adherents through trickle-down. A promise more empty than 2007 Goldman Sachs derivative.
The market’s “manna from heaven” never materialized. Ironically, while these same faith healers chant, we have collectively naively swallowed the hope that the market will deliver all its blessings. “There is no such thing as a free lunch.”
The hidden truth is guarded deep within the inner sanctum; efficient markets disproportionately favor the haves. Those who have resources. We went astray like sheep. Miraculously, the “hipster market” was sold through the zeal of a charismatic preacher. Australians, filled with the spirit of boosting the market, have been deceived. And many established, community-based traditions that prioritized social cohesion over transaction speed were rejected wholesale as quaint relics.
This fallacy of innovation led to the rejection of the wisdom inherent in ancestral practices of governance and mutual aid. They were perversely accused of being “inefficient” simply because they were not written down in neoliberal scriptures.
But this economic reform in the 20th century masked the fact that productivity is rarely neutral. It is always efficient, subject to a set of initial conditions. If these conditions are characterized by great inequality, the market will effectively increase this inequality and label the outcome as “optimal.”
World War II precedent: Allocation beyond profit
The absurd fragility of the “sanctity of the market” argument is best revealed in moments of existential crisis such as World War II. In the 1940s, Western countries, including Australia, faced resource shortages on a scale that collapsed the pure market system. The market mechanism that relied on price signals to manage demand was thought to be too slow, too ruthless, and too prone to failure in national emergencies.
Instead, societies turned to open, non-market mechanisms: rationing, price controls, and state-directed production. These systems are not designed to maximize profits or “efficiency” for shareholders; They were designed to ensure survival and social harmony. They relied on social recognition of the common good. We did not leave the allocation of rubber, fuel and steel to the highest bidder; We allocated them based on collective agreement about what was necessary for the war effort and the subsistence of the population.
World War II proved that when the stakes are high enough, we instinctively recognize that markets are inadequate. We prioritize justice and stability rather than speed. Modern discourse often treats these wartime measures as historical relics, but falling into the novelty fallacy prevents us from seeing them as valid, high-risk tools that prove that human cooperation can often outperform market competition.
The necessity of restrictions: Law as moral framework
If markets are the economic engine, laws and regulations are the steering wheels. Advocates of full market freedom often view regulation as a “distortion,” but this is a misunderstanding of what a market is. A market cannot exist without the legal infrastructure of property rights, contract enforcement and commercial law.
Social mechanisms (laws, labor standards, environmental regulations and universal public services, and cultural traditions) are the way a society manifests its values. These are the mechanisms by which we define what is prohibited in the market. When we ban child labor or mandate pollution controls, we are actually saying that there are human and ecological values that should not be traded for efficiency gains.
These regulations are the “friction” that prevents the market from rushing towards an outcome that society finds morally repugnant. These rules codify the lessons we learned from our ancestors about the dangers of unchecked greed; lessons we are now trying to set aside because they seem “old-fashioned” compared to the flashy new promise of unregulated markets.
Write-off of equity capital
So why is equality so often left out of the policy equation?
The exclusion of equality is a feature, not a bug, of neoliberal canonical principles. By reducing the conversation to the divinity of “efficiency,” we remove the moral complexity of the human experience. Equality is difficult to measure; It requires value judgments, political struggle and empathy. Efficiency seems easier to measure; It only requires a calculator.
By framing social problems as “economic” problems, neoliberal clerics have successfully depoliticized them. These theologians addressed questions of justice as follows: “Does everyone have the right to own a home?” Optimization questions such as “What is the most effective way to manage housing supply?”
This shift allowed policymakers to avoid the difficult work of addressing systemic power imbalances. If an outcome is “fruitful,” it is protected from moral criticism.
take back the future
To move forward, we must stop viewing efficiency as the transcendent end state of human progress. A society that operates solely according to market logic has forgotten how to be humane; it is a communal. We must recognize that our preference for market allocation is a choice; This choice often comes at a direct cost to those who cannot compete on market terms.
Efficiency has its place, but it must always remain the servant of equality, never its successor. We must resist the innovation fallacy—the urge to replace every time-tested social institution with a new market-based model—and instead recognize that the most resilient societies are those that balance market instruments with robust, often ancient, values of justice and collective care.
Dr James Schuurmans-Stekhoven has had a career defined by a high level of academic rigor, a polymatic research approach and a commitment to strategic optimization across many disciplines.
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