Free markets and open borders

It has been interesting to read in your columns of the various complaints of the Australian government about the laxness of Indonesia with regard to the passage of illegal immigrants and, conversely, those from your readers directed at the U.S. and Australian consulates issuing travel visas to Indonesian citizens. Could it be that the solution to both these problems is to adhere closely to the ideas of free marketeers who have pressured the World Bank, IMF, WTO and even the UN to push for open markets?

The benefits of perfect markets and perfect competition cannot be achieved if there are distortions in the market caused by a lack of openness in selective areas. Whilst the trend has been towards open markets in factors of production such as capital and resources and in goods that are produced from those factors, there remain two areas of notable exception where a lack of openness is causing major market distortions and, thus, great hardship for the populations of many countries. These are in the areas of the free flow of information and labor. Both, according to economists, are prerequisites for perfect, and therefore optimum, markets.

Statutory guarantees of open and accurate information about public corporations would help to prevent the corporate corruption that currently threatens the U.S. and, therefore, the global economy. Further, market fundamentalists need to accept that they are seriously flawed in their thinking if they treat the world as one indivisible market and yet do not do away with all immigration controls.

Thus, instead of countries such as Spain, the U.S. and Australia putting pressure on their Third World neighbors to control illegal immigration, a gradual relaxing of border restrictions, as has happened within the European Union, would lead to a far more equitable distribution of income worldwide. This would, in turn, lead to increased consumption (as desired by the free marketeers) and labor, the last trammeled factor, would flow freely which, if the free marketeers' mantra is to be relied upon, should result in more optimal markets and greater prosperity for all.

So, throw away your passports and visas-laissez-faire and prosperity, here we come!

FRANK RICHARDSON, Jakarta