Freedom and Free Markets
What the triumph-of-capitalism, end-of-history story required - among other matters - was that the brutal history of capitalism be whitewashed. The ruthless, Lord-of-the-Flies reality of capitalism gave way to an unshakable and dogmatic faith in free markets. Capitalism was no longer just about profits, free markets equaled freedom.
This coupling of free markets and political freedom had long been promoted by Milton Friedman and it is the theme of his anti-government manifesto, Capitalism and Freedom. Once this dubious connection is made - and in those heady days after the fall of communism it became entrenched - any regulation, any taxation, any state ownership is not just economically unsound, it's a blow to freedom and an affirmation of tyranny and oppression.
This sounds like an exaggeration, but it's really not - the purest of the pure equate government-provided health care with Nazism. And it's not just those on the fringe (if Ron Paul can be considered the fringe). Friedrich von Hayek - who is beloved and revered by adherents to the free-market movement - argued that central planning would lead inexorably to totalitarianism. Milton Friedman - though willing to tolerate significantly more government intervention than the purists - tirelessly promoted the idea that free markets were a precondition of political freedom.
But the thesis is simply not supported by the evidence. It is not the case that there is a hard-and-fast correlation between free markets and free societies. We've seen highly-regulated economic systems in free societies (high-regulation, high-tax European countries) and highly-deregulated economic systems in autocratic societies (China and Russia). For the free-marketeer, the answer to such anomolies is always more purity. Free-market fundamentalists simply do not acknowledge the possibility of market failure. The answer is always freer markets.  
The Real Battle
In 2002 - less than one year after religious fundamentalists flew planes into the World Trade Center and the Pentagon - Jon Stewart suggested that the battle between liberals and conservatives had become anachronistic:
My view is that the liberal/conservative battle doesn't matter anymore; it's sort of a dinosaur. The real battle is actually extremism versus moderates.
When I heard this in 2002 I thought it was exactly right. That's the problem with our country - it's being overrun by right-wing extremists. And it's not just the problem with our country, it's the problem with the world - look at the terrorists responsible for 9/11. In fact, find some really ugly shit anywhere at any time and there you'll find some batshit crazy extremists.  
Although I still believe Stewart is getting at something very important, the term extremism is misguided because, as I've discussed at length elsewhere, the extremist/moderate construct is logically incoherent. The terms I've chosen, the terms I believe to be the least loaded, are Utopians versus Pragmatists - so to rephrase in those terms, I would agree with Stewart: the liberal/conservative battle doesn't matter anymore, the real battle is between Utopians and Pragmatists.  
Utopianism and Pragmatism: Burke and Popper
‘Everything has got to be smashed to start with. Our whole damned civilization has got to go, before we can bring any decency into the world.’ —‘Mourlan’, in Du Gard’s Les Thibaults.
Utopians are true believers. They're doctrinaire ideologues who have arrived at a radical prescription for society through deductive, a priori reasoning. They're levelers who have come to believe piecemeal change will never suffice. They have faith that their utopian vision would work if only they could wipe the slate clean.  
Pragmatists, as I'm using the term here, are perhaps best represented by Edmund Burke (the father of conservatism). For Burke, the Utopian project of the French Revolution was profoundly arrogant - human beings and society are far too complex to be encapsulated by an abstract theory. Societies which evolved over millenia shouldn't be leveled; reform should be gradual:
[Burke's] conservatism was rooted in a deeply ingrained suspicion of any radical politics that was based on abstract principles derived solely from the operations of reason; or as he put it, on an “insuperable reluctance to destroy any established system of government, upon a theory.” There is a basic idea here that is quite straightforward: Society is complex, and human nature unpredictable; therefore, it is not prudent to mess around with political and social arrangements that have stood the test of time. . . .
The French revolution . . . aimed simply to slough off the past. It was an attempt at a root and branch reconstruction of society on the basis of an abstract philosophy of natural rights. There was no recognition of the importance of tradition, custom and sentiment. It was, Burke argued, bound to end in bloody failure.
While Burke, interpreting events through the lens of the French Revolution, saw a battle between revolutionary levelers and conservative defenders of tradition, historian of science Karl Popper railed against Hegelian/Marxist historicism - specifically, the expressed or tacit belief that “history develops inexorably . . . towards a determinate end.” According to Popper, such radical determinism is the enemy of the open society and the foundation of all forms of totalitarianism. Popper thus rejects Utopian engineering in favor of pragmatic, piecemeal change:
[T]here is a certain approach towards politics which, I believe, is most dangerous. . . . The. . . approach I have in mind can be described as that of Utopian engineering, as opposed to another kind of social engineering which I consider as the only rational one, and which may be described by the name of piecemeal engineering. . . .
[The problem] is the sweep of Utopianism, its attempt to deal with society as a whole, leaving no stone unturned. It is the conviction that one has to go to the very root of the social evil, that nothing short of a complete eradication of the offending social system will do if we wish to ‘bring any decency into the world’ (as Du Gard says). [The problem with Utopianism] is, in short, its uncompromising radicalism.
Utopianism Versus Pragmatism in Iraq
In The Shock Doctrine, Naomi Klein argues that free-market reformers, discouraged by the slow pace of democracy, became international ambulance chasers, homing in on countries so racked by crisis they wouldn't be able to resist the standard panoply of radical free-market reforms. Klein convincingly described how, in war-torn Iraq, the Utopian free-market reformers won out over the Pragmatists:
Iraqi exiles pushing for the invasion were divided, broadly, into two camps. On one side were “the pragmatists,” who favored getting rid of Saddam and his immediate entourage, securing access to oil, and slowly introducing free-market reforms. . . . On the other side was the “Year Zero” camp, those who believed that Iraq was so contaminated that it needed to be rubbed out and remade from scratch. . .
A parallel battle between pragmatists and true believers was being waged within the Bush Administration. The pragmatists were men like Secretary of State Colin Powell and General Jay Garner. . . . On the other side was the usual cast of neoconservatives: Vice President Dick Cheney, Secretary of Defense Donald Rumsfeld (who lauded Bremer's “sweeping reforms” as “some of the most enlightened and inviting tax and investment laws in the free world”), Deputy Secretary of Defense Paul Wolfowitz, and, perhaps most centrally, Undersecretary of Defense Douglas Feith.  . . . .
The Iraqi Year Zeroists made natural allies for the White House neoconservatives. . . . Together, they came to imagine the invasion of Iraq as a kind of Rapture: where the rest of the world saw death, they saw birth—a country redeemed through violence, cleansed by fire. Iraq wasn't being destroyed by cruise missiles, cluster bombs, chaos, and looting; it was being born again. . . .
On May 9, Bush proposed the “establishment of a U.S.-Middle East free trade area within a decade”; three days later, Bush sent Paul Bremer to Baghdad to replace Jay Garner, who had been on the job for only three weeks. The message was unequivocal: the pragmatists had lost; Iraq would belong to the believers.
As Klein details, the Utopian believers did in fact institute sweeping reforms - described by The Economist as a capitalist's dream - and yet, the experiment failed miserably. But failure - even abject and total failure - does not deter the Utopian. And in this regard, as Ms. Klein asutely recognizes, Utopians and religious fanatics are cut from the same cloth:
Iraq was to the neocons what Afghanistan was to the Taliban: the one place on Earth where they could force everyone to live by the most literal, unyielding interpretation of their sacred texts. One would think that the bloody results of this experiment would inspire a crisis of faith: in the country where they had absolute free reign, where there was no local government to blame, where economic reforms were introduced at their most shocking and most perfect, they created, instead of a model free market, a failed state no right-thinking investor would touch. And yet the Green Zone neocons and their masters in Washington are no more likely to reexamine their core beliefs than the Taliban mullahs were inclined to search their souls when their Islamic state slid into a debauched Hades of opium and sex slavery. When facts threaten true believers, they simply close their eyes and pray harder.
The faith-based insistence that failure is never a flaw in the model, but rather, a symptom of impurity is perhaps the most chilling and defining feature of the Utopian mindset. One of the ironies - and there are many - is that the end-of-history construct presupposes the fundamental soundness of the Hegelian-cum-Marxist framework. Free-market fundamentalists define themselves as a rejection of communism, but they're really just the flip side of the same Utopian coin. They accept the determinist march-of-history analysis and simply believe Marx misapprehended history's culmination. In the end, Marxists and free-market fundamentalists are equally rigid and doctrinaire: If we don't currently live in Utopia it's because we're not pure enough - we need more deregulation, freer trade, lower taxes; and if that doesn't work, we need even more.
The Utopian Mirage
As Naomi Klein has documented, the quixotic quest for free-market purity led to what Klein has dubbed the Shock Doctrine. The Utopian free-market agenda required a degree of purity that cannot be achieved through the piecemeal democratic process. But Friedman realized that in the wake of a crisis, the citizenry is too preoccupied with survival to resist radical economic reforms; thus, crises became the springboard for the global neoliberal project. Contrary to the claim that free markets and freedom go hand-in-hand, free-market fundamentalism has spread not through democratic processes, but through coercion (IMF imposition of the Washington Consensus) and through opportunistic exploitation of crises (the Shock Doctrine).
And even this hasn't been enough. Economic shock therapy has been disastrous. Free-market Utopia has not been achieved. Predictably, some of its adherents believe the ideal society is just out of reach - the obstacle, they believe, is democracy. Accordingly, they are determined to create a free-market Shangri-La by seasteading:
I deeply yearn to live in an actual free society, not just to imagine a theoretical future utopia or achieve small incremental gains in freedom. . . . I recently began trying to create free societies as my full-time job, and this has given me a dramatic perspective shift from my days of armchair philosophizing. My new perspective is that the advocacy approach which many libertarian individuals, groups, and think tanks follow . . . is an utter waste of time.
Democracy . . . is ill-suited for a libertarian state. . . .  
Seasteading is my proposal to open the oceans as a new frontier, where we can build new city-states to experiment with new institutions. This dramatically lowers the barrier to entry for forming a new government, because expensive though ocean platforms are, they are still cheap compared to winning a war, an election, or a revolution. . . .
There is so much to unpack here - there's the deep yearning to live in an actual free society and not just imagine a future utopia (his word, not mine), there's the point-blank recognition that libertarianism and democracy are incompatible and then, of course, there's the seasteading. They've exploited crises for several decades, but have fallen well short of Utopia. But to the Utopian, failure doesn't suggest a problem with their ideology, the problem is democracy. So, the solution - obviously! - is an artificial island on the high seas. (You really can't make this stuff up.)
As Burke and Popper warned (and as the disastrous Iraqi experiment has shown), the Utopian dream is a mirage. Moreover, as economist Paul Krugman observed, the quest for Utopia is more than just futile or misguided, the Utopian crusade is the road to hell. It is simply not the case that any government intervention will lead inexorably to totalitarianism. It is not the case that free markets and political freedom rise and fall in precise unison. What history shows, in fact, is that the best and most decent societies history has thus far created aren't based on a Utopian ideal, but on an imperfect and pragmatic compromise.
The open society as thus conceived of by Popper may be defined as ‘an association of free individuals respecting each other's rights within the framework of mutual protection supplied by the state, and achieving, through the making of responsible, rational decisions, a growing measure of humane and enlightened life’ As such, Popper holds, it is not a utopian ideal, but an empirically realised form of social organisation which, he argues, is in every respect superior to its (real or potential) totalitarian rivals.
It would be hard to imagine a better symbol of free-market fundamentalism than the Maestro, Alan Greenspan. He openly acknowledged his reverence for Ayn Rand and he, probably more than any other person, was responsible for deregulating the financial markets. He was, in the end, wrong and the world will pay the price for his errors. But for one brief moment Mr. Greenspan was right about one thing: his Randian ideology - like all Utopian ideologies - is fatally flawed.
Author's Note
My original thoughts on this topic were inspired by fellow Kossak Dale, who suggested the historical link between Fukuyama's end-of-history thesis and the knee-jerk reliance on traditional free-market policies. Additionally, I was pointed to Karl Popper's critique of historicism by fellow Kossack Noziglia. This diary owes much to their contributions; any mistakes are my own.  
Cross-posted at Daily Kos