In my view, the public crisis of confidence that has shaken the global financial markets in the last five years is one of losing public confidence in the 'free' market for global capital. The 'free' market for capital was never fair, never in the public interest: it has been a Darwinian fight not-to-lose between informed traders, each a willing counterparty to a 'trade'. The egregious failure of so-called 'self-regulation', the hand on the heart promise not to be caught at sneaking that little extra profit wherever possible, exposes the intrisic unfairness of the free market itself. What I think the public needs to hear from market particpants, IMV, is a greater willingness to be subject to greater transparency and open to fairer and more effective governance, even if these, because of privilege and privacy considerations, become available in the aftermath of transactions.

I see a common denominator in your comments, dear Frieder and Peter: state intervention. I agree that the actual crisis can be seen as a political crisis; it's not a lack of authority, but a lack of direction, of political insight, of capacity to adapt to change, of political courage (the capacity to assume responsibility for less popular measures) and the list can go on.

Thank you, Peter for bringing in the discussion of free markets, because since we have YouTube, a flow of easy-fix solutions are posted there including the ones related to the relation between state and free-markets. I have asserted before that we have never had free markets and maybe we are going to never experience such a thing. It is not even Marxism to recognize that the current system is not characterized of freedom, but of domination, where working relations are just a small part of the big control system. Other examples are housing policy, credit policy, pension system, education system etc, all these in the name of freedom or free market capitalism. I see a contradiction between the capitalism in theory and capitalism in reality. In 1989-1990 the Eastern European countries abolished their communist forms of government and voted for freedom, what they have got is a whole different story. I would like to experience the capitalism of conscious action, as you mentioned Frieder.

The state interventions (legislative and administrative) have grown exponentially, because the negative results of domination are qualified as market failures and corrected by further state interventions. It's like a vicious cycle. Why? Because apparently the state money are designated to combat the social injustice, but the statistics show that in reality the beneficiary are situated on a different position, the gain being collected by somebody else than the target-beneficiary of the state measure. Examples for that we can find in the public procurement sector or tax policy, e.g. the RUT deduction in the Swedish system. The money comes from the common pot, are distributed on the pursuit of diminishing the social injustice and the final result is that the social injustice is merely increased. The target-beneficiary of the state interventions is not the actual collector of the benefit and the history goes on and on again. In order to change this status-quo you need more courage than a Teuton soldier and a lot of back-up.

Charles S. Peirce, "Evolutionary Love", The Monist, vol. 3, pp. 176-200 (1893)

"The nineteenth century is now fast sinking into the grave, and we all begin to review its doings and to think what character it is destined to bear as compared with other centuries in the minds of future historians. It will be called, I guess, the Economical Century; for political economy has more direct relations with all the branches of its activity than has any other science. Well, political economy has its formula of redemption, too. It is this: Intelligence in the service of greed ensures the justest prices, the fairest contracts, the most enlightened conduct of all the dealings between men, and leads to the summum bonum, food in plenty and perfect comfort. Food for whom? Why, for the greedy master of intelligence. I do not mean to say that this is one of the legitimate conclusions of political economy, the scientific character of which I fully acknowledge. But the study of doctrines, themselves true, will often temporarily encourage generalizations extremely false, as the study of physics has encouraged necessitarianism. What I say, then, is that the great attention paid to economical questions during our century has induced an exaggeration of the beneficial effects of greed and of the unfortunate results of sentiment, until there has resulted a philosophy which comes unwittingly to this, that greed is the great agent in the elevation of the human race and in the evolution of the universe."

A little later in the same article, http://www.cspeirce.com/menu/library/bycsp/evolove/evolove.htm

Peirce said:

" The economists accuse those, to whom the enunciation of their atrocious villainies communicates a thrill of horror, of being sentimentalists. It may be so: I willingly confess to having some tincture of sentimentalism in me, God be thanked! ...

But what after all is sentimentalism? It is an ism, a doctrine, namely, the doctrine that great respect should be paid to the natural judgments of the sensible heart. This is what sentimentalism precisely is; and I entreat the reader to consider whether to contemn it is not of all blasphemies the most degrading. Yet the nineteenth century has steadily contemned it, because it brought about the Reign of Terror. That it did so is true. Still, the whole question is one of how much. The Reign of Terror was very bad; but now the Gradgrind banner has been this century long flaunting in the face of heaven, with an insolence to provoke the very skies to scowl and rumble. Soon a flash and quick peal will shake economists quite out of their complacency, too late. The twentieth century, in its latter half, shall surely see the deluge-tempest burst upon the social order -- to clear upon a world as deep in ruin as that greed-philosophy has long plunged it into guilt. No post-thermidorian high jinks then!

So a miser is a beneficent power in a community, is he? With the same reason precisely, only in a much higher degree, you might pronounce the Wall Street sharp to be a good angel, who takes money from heedless persons not likely to guard it properly, who wrecks feeble enterprises better stopped, and who administers wholesome lessons to unwary scientific men, by passing worthless checks upon them -- as you did, the other day, to me, my millionaire Master in glomery, when you thought you saw your way to using my process without paying for it, and of so bequeathing to your children something to boast about of their father -- and who by a thousand wiles puts money at the service of intelligent greed, in his own person. Bernard Mandeville, in his Fable of the Bees, maintains that private vices of all descriptions are public benefits, and proves it, too, quite as cogently as the economist proves his point concerning the miser. He even argues, with no slight force, that but for vice civilization would never have existed. In the same spirit, it has been strongly maintained and is today widely believed that all acts of charity and benevolence, private and public, go seriously to degrade the human race.

The Origin of Species of Darwin merely extends politico-economical views of progress to the entire realm of animal and vegetable life. The vast majority of our contemporary naturalists hold the opinion that the true cause of those exquisite and marvelous adaptations of nature for which, when I was a boy, men used to extol the divine wisdom, is that creatures are so crowded together that those of them that happen to have the slightest advantage force those less pushing into situations unfavorable to multiplication or even kill them before they reach the age of reproduction. Among animals, the mere mechanical individualism is vastly re‰enforced as a power making for good by the animal's ruthless greed. As Darwin puts it on his title-page, it is the struggle for existence; and he should have added for his motto: Every individual for himself, and the Devil take the hindmost! Jesus, in his sermon on the Mount, expressed a different opinion."

Well, clearly, we are a bunch of heretics in askance about the 'wisdom' received supposedly by that dominant social entity, homo economicus (HE). As a scientist, I see just anomie and desolation pervading the HE life; as a person I also need more vivacity and romance than HE ever entertains: HE cannot be in control of the endgame!

In my book (Burton 2011: www.createspace.com/3494821; p221) there is a table which advances a new theory of how greater social harmony among men might be constructed. It is a beguilingly simple concept: obtain drafts of the rules of conduct for a socially harmonious group (focused on the other, exhibiting empathy, sharing resources, mentoring, etc) by logical inversion of the egocentric traits of the child. The inverted rules become a set of principles-for-life, for a community intent on aspiring to continual improvement in their common lot.

Such rules might underpin a more sustainable but nevertheless increasingly peopled planet, as they match current conceptions of ancient indigenous life in a harsh and unforgiving environment such as Australia's before the white usurpers arrived.

Your answer, dear Peter suggests that we all are heretic against the higher order of homo economicus. Already in 2008 I've a written a paper in the field of antitrust law and challenged the idea that we act as genuine homo economicus even in the field of business on big scale. The directors of the big corporations are not only concerned with the profit of the company, but also with their own career, social position, maybe they have political sympathies, friends from college and so on. We never decide something like a robot (input-output). Moreover when it comes to cartels since they are illegal, you as decision maker in this context must trust the other participants and trust is a social construction (this is what I've argued).

Home economicus is a fake, exactly the idea of freedom gives an idyllic image of the markets. This is not heresy, but raw realism, I claim. The fact that revolutions almost always lead to turbulence and then to a new order not necessarily better, but just different, shows that we must realize that the idea of freedom as such might be a trap. I am not for heresy and not for revolutions either, I am for thinking before acting or acting with a deeper meaning.