Lindblom - The Market System - Afghan Journalists' Committee

Necessary to Democracy? 233fend itself, through an assault on the mass mind, by teachingmass allegiance to the market system.I can suggest some supporting detail. Royal authority,custom, and legislation long stood in the way of markettransactions, not wholly blocking them but greatly constrainingthem. In the seventeenth and eighteenth centuriesan English merchant class intent on enrichment fromsuch transactions as were permitted clamored for moremarket opportunities, such as those consequently grantedby royal authority to the Dutch East India Company and theBritish East India Company. The merchant class was notwithout power to win them. For royal authority neededfunds for waging war and for ordinary administration—greater funds than a weak tax system supplied—and turnedto merchants both for helpful loans and new tax revenues.Merchants responded, but only conditionally, making fundsavailable only in return for new freedoms to exploit marketopportunities. Entrepreneurs thus eventually accomplished,in a mixture of inadvertence and deliberation, new constraintsover king and over established landed elites. Powerover government became diffused, and merchants enjoyedand profited from their range of liberties. The emergingmarket system operated to their enormous advantage.Not surprisingly, the new order had the effect of stimulatingother groups in society to demand some of the selfgoverningfreedoms and rights won by merchants. Themerchants then faced a choice: suppress the epidemic ofdemands, as in nineteenth-century Germany, or coopt andmake allies of those who made the new demands, as inBritain. The latter choice put the English merchants on thepath to political democracy.Having allowed or encouraged minimal democracy to