6.1.4 Mixed Economies
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6.1.4 Mixed Economies
If a command economy provides too little economic freedom to citizens, and a laissez-faire capitalist economy provides too little security, what is the alternative?
Does a mixed economy provide a happy alternative, with the potential to allow enough freedom to provide incentives for hard work and new ideas while at the same time providing the positive freedoms and security to benefit the majority?
Courtesy Jonathan Barker, Quotation by Ronald Reagan
Click image for larger view
As you learned earlier, in 2007, the world saw the beginning of a global recession. There were several causes for this economic meltdown, but a huge factor was the role banks played in the crisis.
The photo was taken by a British researcher shortly after the global economic crisis began. In the background are the skyscrapers owned and operated by international banks. In the foreground, the banner reads "Happy Nightmares: Open for Business as Usual."
What do you think the banner refers to? Does it suggest that an unregulated economy can lead to a nightmare for people's employment and their savings? Or does it suggest that the real nightmare is when governments bail out failing business enterprises?
The quotation on the poster comments on the attitude of some governments toward the economy. This quotation is from former US President Ronald Reagan who believed in smaller government and fewer rules. In this context, it has a message that governments tend to interfere too much in the economic affairs of their people.
A mixed economy is an economy based on the principles of private property and economic freedom, but also it includes public property and some limits or regulations to benefit collective interest. Ideologically, it has aspects of both collectivism and individualism.
The photo was taken by a British researcher shortly after the global economic crisis began. In the background are the skyscrapers owned and operated by international banks. In the foreground, the banner reads "Happy Nightmares: Open for Business as Usual."
What do you think the banner refers to? Does it suggest that an unregulated economy can lead to a nightmare for people's employment and their savings? Or does it suggest that the real nightmare is when governments bail out failing business enterprises?
The quotation on the poster comments on the attitude of some governments toward the economy. This quotation is from former US President Ronald Reagan who believed in smaller government and fewer rules. In this context, it has a message that governments tend to interfere too much in the economic affairs of their people.
A mixed economy is an economy based on the principles of private property and economic freedom, but also it includes public property and some limits or regulations to benefit collective interest. Ideologically, it has aspects of both collectivism and individualism.
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"What is a Mixed Economy?", Mr. Sinn, You-tube
Canada and Sweden
These two countries are examples of nations that have developed mixed economies based on their values and principles. When we think about mixed economies, we tend to think of democratic nations that operate their economies on free-market principles but with greater regulation of industry and some degree of public ownership. Another term for this system is democratic socialism. A key belief behind mixed economies is that the government has some responsibility for the common good. Voters elect governments that value individual rights, including the positive right to freedom from excessive poverty. They also value a degree of equality that include social programs to protect their citizens. A key reason Canadians have not been effected as negatively by the global economic downturn was regulation of the banking sector. Canadian financial institutions have clear rules that control how money can be lent and borrowed. These rules protect investors and consumers. (See " Rights and Freedoms in Mixed Economies".)In Canada, most health care services and education programs are publicly owned and operated. Hospitals and schools are operated by provincial governments, and healthcare and education are free to all Canadians. The government of Canada also operates several crown corporations, which are businesses that serve the needs of Canadians. These are often businesses that the private sector was not willing to provide to all citizens, or businesses that promote Canadian culture. The CBC and Canada Post are examples of crown corporations.
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"The Canadian Welfare State", Hailey Zilberberg, You-tube
Perspectives on Social Programs
Supporters of the free market, especially neo-conservatives in the United States, often criticize the social programs provided by mixed economies because of their ideological perspectives. They believe so strongly in individualism that they feel people should be self-reliant and should not depend on outside forces to help them in times of trouble. They also feel that, if everyone was self-sufficient, there would be little or no need for income or corporate taxation, leaving more money in the hands of individuals.If you watch Fox News or other conservative television networks, you may hear taxpayer-funded programs such as healthcare called "liberal" or "socialist" and nations that provide them called "welfare states". Keep in mind that these terms are meant as criticism. When used in this way, they show that people around the world have very different understandings of what these words mean. For most Canadians, Europeans, and citizens of other liberal democracies, these terms do not carry such a negative connotation.
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"Social benefits in Canada. LP Group", Canadian Immigration Channel, You-tube
Read from your text Perspectives on Ideology:
"Blair's Third Way", page 222
"The Netherlands' Polder Model", pages 222 to 224
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"What is a Market Economy?", Mr. Sinn, You-tube
As you read, take notes on the following:
How much freedom is there in a mixed economy?
Is a mixed economy primarily collectivist or primarily individualist in its ideological approach?
To what extent is a mixed economy viable today?
Is a mixed economy primarily collectivist or primarily individualist in its ideological approach?
To what extent is a mixed economy viable today?
