I absolutely agree with you about the superiority of the free market to any sort of central planning. But let’s not give it more credit than it deserves.
Much free market spending does not generate wealth, notably that performed primarily as a display of wealth. Much of it is about as “productive” as the potlatches of the Northwest Coast Indians, where they piled up massive amounts of goods and burned them to demonstrate their wealth. And of course serves exactly the same purpose.
The superiority of the free market is only a general superiority, not a specific one. Just as evolution works in general, with the “fittest” mostly surviving, but doubtless many a beneficial mutation dying out by chance. So the market destroys many good ideas before they can come to fruit.
Which means the market, like evolution and democracy, is the worst possible way to run things, except of course for all the alternatives. It’s not that the market is particularly efficient, it’s that the other systems are so spectacularly ineffecient.
BTW, an off thought struck me the other day while reading FR. The people who believe most strongly in the free market for the economy, in this country, are often disbelievers in evolution for biology. Which is odd when you consider that the two use essentially identical mechanisms.
Meanwhile, of course, those who believe most strongly in evolution and despise the idea of a God that interferes in the world, are disproportionately opposed to the idea of the free market, wanting humans to use their superior intellect to decide winners and losers, rather than leaving it to “chance.”
Seems to me the creationist/market types are somewhat less illogical here. At least they posit an omniscient divine being to control biology, while the evolution/command economy folks rely on admittedly fallible, and inherently ignorant and corruptible humans to control the economy.
When you denigrate “displays of wealth”, you’re substituting your values for those of the individuals “wasting” their money. That’s what central planners do by necessity — and, it’s part of the reason central planning doesn’t work. Economic man is expected to attempt to maximize “utility” — that “utility” is always subjective, and could be said to be synonymous with “wealth” (in a larger sense). Only *you* know your personal utility function; and when someone else tries to impose one on you, your “wealth” will have been reduced.
BTW, potlatches were mostly concerned with the redistribution of wealth, rather than the outright destruction of same. Prestige and social standing was attained by whoever could give away the most wealth. In that sense, potlatches weren’t very different from modern philanthropy. For instance, we see billionaires like Bill Gates becoming full time re-distributors of their wealth. In return, they get social standing (liberals adore them), and can feel good about themselves. If they value those things more than (say) more mansions, private jets, and yachts — who are we to judge?
I’ll leave the evolution/creationism Tar Baby untouched, if you don’t mind.