Wednesday, July 21, 2010


Mark Martinez's book traces the historical roots of capitalism to the present day. He argues convincingly that free markets have never existed in either western Europe or North America. Instead, markets as they pertain to capitalist economies have been the result of conscious decision-making on the part of political regimes to facilitate them. The book begins with western Europe's need for money to fund its wars, and so in those days of early capitalism, what were developing into European nation-states began to tax and control the merchants, eventually relying heavily on the hard work of these merchants to support these nation-states. The book then shows how this relationship between merchants led to a rising middle class, which even enlarged in especially Britain and later in the United States with the industrial era. Specific policy decisions on behalf of European governments and the United States are reviewed, and the book concludes with the post-industrial era's latest trend to deregulate from 1970 to the present day, roughly, all the major business interests in the United States that had once safeguarded against poor decision-making on behalf of, for example, Wall Street folk, among others, who have, fairly recently, done such as buy and sell and resell America's debt to create bubbles of capital accumulation. The book is perceptive, fairly short, and worthy of purchase.

Billie's Review
Posted on Good Reads / February 8, 2010

Thursday, February 25, 2010


Below is a book review penned by Dr. Robert J. Barney. The review provides insight into what you can expect from my book and was originally published in the journal, Voluntas: International Journal of Voluntary and Nonprofit Organizations. The journal review can be accessed here  (firewall may apply).


For over 30 years, free market ideology has experienced increasing influence in economic policy. Free market advocates emphasize the self-regulating nature of the market in establishing fair pricing, efficiency, and maximizing profits. According to this ideology, government intervention in markets is tantamount to interference, drains society’s resources, and contributes to economic inefficiency. The Myth of the Free Market refutes these claims by discussing “the dominant role of state in making markets work” (p. 4). The focus of Martinez’s work is to provide the reader with historical examples of state initiatives and interventions that have contributed to shaping the economy and that have often allowed markets to prosper.

Part one of the book provides an examination of individuals typically associated with free market thought, including Milton Friedman and Adam Smith. Perhaps the most compelling arguments relate to the government’s pivotal role in establishing justice for all, not only in the political arena, but also within the market. Martinez argues that the government’s role is to tame oppressive forms of power that prohibit some from participation in capitalist economies, an idea that is contrasted against the minimized “umpiring” role of the state that Friedman emphasized. What is central to the thesis is that the “laws of justice”, which Adam Smith saw as necessary for market functioning, are violated on a regular basis as a result of greed. Timely examples are provided relating to how exuberance and the irrationality of the market led to recent bubbles, and ultimately the 2007–2008 credit crisis.

As the reader moves into parts two and three, a wide variety of historical examples are used to establish the central role of government in a capitalist economy. This discussion includes the development of economies during the Middle Ages, with references to hereditary powers that used political organization for personal economic gain. The role of war, the Renaissance’s emphasis on reasoning and investigation, and the rise of democracy are also described as forces that shaped economic policy, the development of capitalist markets, and ultimately the middle class. Perhaps some of Martinez’s most persuasive discussions include his focus on markets during the twentieth century, including the development of the international financial system. A strong case is made for how the modern global economy did not evolve arbitrarily by means of an invisible hand, but instead was the result of deliberate political intervention.

Part four of the book contains a shift in emphasis, focusing on recent growth in deregulation and a culture of deficit spending in the US economy. Contrary to what the reader might expect, Martinez does not conclude by proliferating on the moral certitude of political forces in ensuring the success of the market. Instead, the author addresses the dichotomous roles of the state throughout history, which has involved both the protection of citizens from oppression in the market, as well as the fostering a culture of debt and market euphoria. Without proper economic intervention strategies, the state has the ability to not only prevent economic failures, but also promote them.

The Myth of the Free Market is strongly recommended for both academics and non-academics with interest in economic policy. Although each of the examples used makes a strong case for the central role of the state in capitalist markets, Martinez’s breadth of historical references does risk losing the reader in diversity of material. However, references to the recent global economic crisis are timely, prompting the reader’s active engagement with the material. Although not unique when compared to other works critical of free market ideology, Martinez’s attention to issues of social justice also represents strength of the writing.

In addition to teaching and his other academic related activities Dr. Robert J. Barney is Associate Research Director and Principal Investigator at the Kent School of Social Work, which is located at the University of Louisville.

Tuesday, December 8, 2009


The Myth of the Free Market by Mark A. Martinez is exceptionally well researched and written. It reads more like a text book than a casual reader and, as such, should be required reading for every senior high school student in America. It thoroughly demolishes the concept that free markets exist on anything larger than a local scale and cogently explains why free markets on a larger scale are probably not possible. Beyond high school, it should be taught in every MBA and graduate economics program so that those who manage the financial empire actually have some relevant information about how things really work and are better able to cope with day to day reality. It is high time that delusional thinking stop being the core operating mode in both the private and public policy sectors of our economic world.

John Hemington,
McMurray, PA
Posted on / Dec. 7, 2009

Tuesday, September 29, 2009


You can see California State University, Bakersfield's press release for my book here.

- Mark

Tuesday, August 18, 2009


In this interview I discuss some of the concepts I write about in my book, The Myth of the Free Market, with Bakersfield's local NBC affiliate (KGET 17) morning anchor Kiyoshi Tomono. If your computer can't support the spot you can try this YouTube site or this one.

Also, among the many radio interviews I've done across the country, I did a an interview with regional NPR host, Terry Phillips, in early April. Terry Phillips hosts Quality of Life, which has a wide audience throughout California's San Joaquin Valley. You can access it here. Click on "author interview." This is my favorite interview.

- Mark


Apart from the endorsements listed below, the following book review by Southern Utah University Associate Professor of Economics, Dr. David Berri, provides insight into what you can expect from my book. This review was originally published in the Kern Economic Journal (Vol. 11, No. 1), which you can access here.


uch has been said about how our current crisis is the “worst since the Great Depression.” Although our present economic problems certainly fall far short of what was experienced 80 years ago, much can be learned about how we view the current crisis by looking back at the 1930s.

At that time there were those who argued against employing market capitalism as the organizing principle for a nation’s economy. After all, while the market based economies of the United States and Europe experienced horrendous rates of unemployment, the centrally planned system utilized by the Soviet Union provided full employment to its citizens. Furthermore, the Soviet Union’s economy was actually growing in the 1930s. Into this debate stepped Friedrich Hayek. In the “Road to Serfdom”, Hayek demonstrated why a centrally planned system was doomed to failure. Hayek’s arguments in favor of capitalism were further echoed in the writings of Milton Friedman, whose work eventually inspired the “Reagan Revolution” in American politics. It was Ronald Reagan who argued “government is not the solution to our problem; government is the problem.” The choice Reagan presented was as follows: Either one could choose to solve problems via the free market. Or one could follow the example laid forth by communists and rely on the government. Given such a choice, the former is clearly preferred.

Within years of the “Reagan Revolution”, the Soviet Union collapsed. Furthermore, most other centrally planned economies have turned to capitalism and the free market system. All of this suggests that Hayek, Friedman, and Reagan were correct. Free markets – not government – should always rule the day.

The choice between government and markets, though, is a false choice. In “The Myth of the Free Market”, Mark Martinez argues convincingly that one cannot have market capitalism without government intervention. In fact, much of what we take for granted about capitalism was created and supported by government policies.

And when government fails to perform its proper function, the free market system itself fails to function.

Martinez begins his argument with the story with a Montana rancher named Lynn Cornwell. Cornwell came to Washington in 2000 to argue that the estate tax needed to be repealed. After all, a family should not lose both a family member and the family business at the same time. What Cornwell failed to note in his argument was that (a) there are no examples of a family farm being lost to the estate tax and (b) Cornwell had received more than $400,000 in federal subsidies to support his farm. In other words, Cornwell was opposed to government intervention when it might harm his interests. But he was more than willing to support government intervention when the invisible hand of self-interest led him to that conclusion.

The Cornwell story is not an isolated case. As Martinez notes “the self-interest and greed” that Adam Smith embraced in the market do not magically check itself at the gates of the state. Rather, the “laws of justice” (the shifting of resources from one party to another) that Smith spoke about are broken so consistently that we cannot simply shrug and chalk it up to market aberrations.” He goes on to add, “…market players – as the Lynn Cornwell case illustrates – often view the state as another vehicle to pursue their ends.”

It is important to note – as Martinez emphasizes – that Cornwell’s behavior is not some isolated incident. And this behavior is not something that has only manifested itself recently. The strength of Martinez’s argument lies in his frequent appeal to historical evidence in making his case.

Throughout this book Martinez makes reference to the historical figures and events that have shaped the capitalism observed today. Along the way we meet Genghis Kahn, William of Orange, Alexander Hamilton, Thomas Jefferson, James Madison, Michel Chevalier, and many others. In addition, Martinez references the writings of Adam Smith, Jeremy Bentham, Thorstein Veblen, John Kenneth Galbraith, and of course, Hayek and Freidman. The historical foundations of this book allow one to clearly see the role the state has played in the development of modern capitalism.

Returning to the 1930s, much has been made of the fact that Friedman’s study of the Great Depression concludes with the argument that this crisis was caused by a failure of government policy. According to Freidman, a simple recession became an economic catastrophe when the federal government allowed 33 percent of all banks to fail in the United States. It is important to note, though, that Freidman was not calling for less government intervention. No, Freidman actually believed that the Great Depression could have been averted by more aggressive government action. Specifically, Friedman himself believed the government should have done more to save the banks and expand the money supply.

Over time, though, this aspect of Freidman’s argument was lost. All that remained was the willingness to blame the government. This focus on blaming the government for societal problems led to a call for de-regulation in the 1980s. And this in turn led to the market excesses of the last twenty years.

Once again, we find ourselves in the same position seen eight decades ago. This time, though, decision-makers are actually following the original advice of Friedman. Banks are being bailed out and the money supply is being expanded. In addition, we are following the advice of John Maynard Keynes and employing government spending to return the economy to full employment.

In sum, the effects of our current crisis are being mitigated by the interventions of the state. As we learn from “The Myth of the Free Market”, the state has often played such a role. Furthermore – as Martinez forcefully argues – capitalism does not function well when government fails in its function.

One suspects that despite the current state of the economy, true believers in the “Reagan Revolution” will persist in their belief that “government is the problem.” For these people especially I recommend “The Myth of the Free Market.” Mark Martinez – via clear writing and a wealth of historical evidence – clearly demonstrates that the market mechanism without government intervention does not produce the outcomes society desires. Recent events do nothing but confirm this hypothesis. Now read this book and see why government can indeed be a solution to our problems.

In addition to teaching economics and his other academic related activities Dr. Berri is the co-author of Stumbling On Wins: Two Economists Expose the Pitfalls on the Road to Victory in Professional Sports and Wages of Wins: Taking Meassure of the Many Myths in Modern Sports, and numerous other academic articles. He also hosts his own website, The Wages of Wins Journal.

Saturday, March 7, 2009


"In this thoughful and erudite book, Mark Martinez forces us to re-examine the myth of the 'natural' free market order. Using very intelligently a wide range of fascinating historical and contemproary examples, he takes us through many important economic, political, and philosophical reflections about the true nature of the market system and its important but limited role in the construction of a civilized society."

"A fast-moving primer bursting with relevant examples, The Myth of the Free Market is---to put it mildly---eye-opening. Mark Martinez's insight could not have arrived at a more important time. Compelling from cover to cover."

-- BILL HARNSBERGERDaily Kos,  Featured Writer (Bill in Portland Maine). 

"Explains the role of political processes in creating and supporting capitalist markets."


"An artfully assembled series of essays on political history, economic philosophy, and social behavioral responses to US and world events in modern times. Martinez presents all this in a clear and readable style ... Timely and well researched, this work should be recommended reading for any candidate for elected office in the US."

-- JUAN M. RIVERA, University of Notre Dame, Professor of Accounting and Faculty Fellow, Kellogg Institute for International Studies, and co-editor of NAFTA and the Campesinos: The Impact of NAFTA on Small-Scale Agricultural Producers in Mexico and the Prospects for Change.

"In the midst of one of America's deepest economic recessions, Martinez offers, a timely, insightful, if not controversial work reexamining the centuries-old conundrum of the proper balance between free market capitalism and role of government in our market economy ..."

-- HENRY LOWENSTEIN, Dean and Professor of Management, E. Craig Wall Sr. College of Business Administration, Coastal Carolina University

"Is a completely free market truly the best way to do things? The Myth of the Free Market: The Role of the State in a Capitalist Economy is a scholarly economic guide exploring how the concept of the free market is flawed, as evidenced by the emergence of the current economic crisis and the slew of bailouts that have come with it. Taking examples from history, The Myth of the Free Market explains the issue and shows why the free market is best enhanced with principles from other systems."

“Martinez provides a much-needed and welcome antidote to the free market mania that has dominated policy-making circles over the last thirty years ... Government’s powerful protection of markets is discussed in broad historical terms, with specific case studies, and thought-provoking analysis that connects perfectly with the current realities of our troubled economy and financial markets.”

-- PETER H. LOEDEL, Professor and Chair, Department of Political Science, West Chester University

“Ronald Reagan told us that “government is not the solution to our problem, government is the problem”. This statement helped convince an entire generation that government does little more than hinder economic growth and the well-being of society. Professor Martinez – via lucid writing and a wealth of historical evidence – clearly demonstrates that relying on private market players alone to protect the integrity of markets will not produce the outcomes society desires. Recent events confirm this hypothesis. Read this book and see why Ronald Reagan was wrong and how government not only organizes markets but can indeed be a solution to our problems."

"A thoughtful, timely, and fascinating read for anyone interested in a deeper understanding of the development of states and markets. Martinez's book provides a rich array of cases and a compelling argument for the central role of the state, and politics, in the development of markets--something to ponder in our current economic crisis.”

-- LIA ROBERTS, Assistant Professor of Political Science, Mount St. Mary's College