If you add in the GDP component of the financial and defense industries, you are looking at a massive overhead of markets managed by implicit or explicit government enforcement (or lack of it) for the benefit of a small elite. This is similar to China, but the Chinese have strategic vision for their economy; in the US it is managed by random allocation of lobbyist dollars.
"If you add in the GDP component of the financial and defense industries, you are looking at a massive overhead of markets managed by implicit or explicit government enforcement (or lack of it) for the benefit of a small elite."
This is not true.
To construe 'finance' a just some arguably unnecessary or inefficient 'overhead' in the economy belies a basic lack understanding of what that industry actually does.
It's often opaque to outsiders, but banking is a real value creating part of the economy, and it's also right at the foundation of it.
Also, 'defence spending' is a normal part of every economy, and it has existential impact for all of us.
Consider for a moment that US forces keep most international waterways open for everyone to use, even economic rivals, and even military rivals (!) so long as there's no war. The Suez Canal, Panama Canal, and other critical areas would instantly be under the control of nefarious regional forces if there were a power vacuum.
The Big Thing that the banking system does is it lends people money and charges interest. The other services it provides are important but minor compared to that central goal.
Now, the US has an overt policy of controlling what interest rate is charged.
So the banking system is a free market in the sense that theoretically participants could choose to leave if they wanted to. However, there is also a very overt layer of government decision making and control. The government putting a finger on the scale in a very fundamental way.
Exactly how that compares to China is difficult to judge - whatever it is, I argue it isn't very capitalistic. Capitalists are supposed to go broke when they lose money and given how low interest rates are they are more likely to refinance themselves with a new loan. The damage that has been doing to wealth creation since the GFC in around '08 is profound.
It is hard to say how much worse China's approach is. It isn't as clear cut as China's Government vs 10,000s of Capitalists - in which case I'd favour capitalism by the numbers. The US government is hamstringing the ability of its own economy to organise around profitable ventures. Instead it is encouraging Ubers and Lyfts.
> So the banking system is a free market in the sense that theoretically participants could choose to leave if they wanted to. However, there is also a very overt layer of government decision making and control. The government putting a finger on the scale in a very fundamental way.
You say this as if China were innocent in manipulating banks to control their banking system. This is not true. [1]
>The US government is hamstringing the ability of its own economy to organise around profitable ventures. Instead it is encouraging Ubers and Lyfts.
I disagree with this. I believe the Ubers and Lyfts (and Teslas) are caused by investors wanting to get in on the ground floor of the next Apple. To support your argument, please explain how the US Government is preventing its own economy to organize around profitable ventures. You may use citations.
If you add in the GDP component of the financial and defense industries, you are looking at a massive overhead of markets managed by implicit or explicit government enforcement (or lack of it) for the benefit of a small elite. This is similar to China, but the Chinese have strategic vision for their economy; in the US it is managed by random allocation of lobbyist dollars.