Don’t Worship the Free Market – Sandy Ikeda

“I’m tired of hearing that ‘liberty’ will take care of it!”

My young friend was explaining to me why she’s become less enthusiastic about libertarianism than she was a few years ago. I suspect she speaks for many smart young people who are just learning about libertarianism and getting a lot of bumper sticker ideas. Our belief in human freedom can strike them more as religious doctrine than as reason.

Illustrates the intersection of supply and dem...
Illustrates the intersection of supply and demand curves as the free market equilibrium (Photo credit: Wikipedia)

“Liberty Will Take Care of It!”

I had been pointing out a building going up in my neighborhood that blocked a significant part of the public’s view of the Brooklyn Bridge. I said something to the effect that, if it were up to me, I’d lop off the top three floors of that thing because many, including myself, feel it exceeds the limit agreed to with local community organizations, and I thought there was probably some misrepresentation going on.

That’s when she told me how tired she is of the standard libertarian refrain: every time some social issue comes up in her discussions with libertarians — spillovers, poverty, inequality, health care, racial discrimination, the environment — their response is that the free market will solve the problem.

Liberty Is Not a Shut-Up Argument

There are libertarians who do simply chant the free-market mantra. They insist that market exchange and private property can solve all our problems — but they can’t, and we shouldn’t expect them to. (See my earlier Freeman articles “Property Rights Aren’t Always the Libertarian Solution” and “Moving Beyond Free-Market Minimalism.”)

My faith in freedom isn’t blind. It’s not really a form of faith, either — more of a shorthand for my understanding of theory and history.

Suppose, for example, that 50 years ago, when AT&T still had a government-granted telephone monopoly in the United States, someone asked how phone service could be provided by private companies that didn’t have that legal privilege. How, without eminent domain to take private property for those essential telephone lines and exchanges, would people be able to make and receive calls from their homes and businesses?

Fast-forward to today and we see practically every person over the age of 13 (and quite a few much younger) in the developed world carrying a cell phone or a smartphone small enough to fit in their pocket that combines telephone, Internet service, and a video camera. There are no cumbersome telephone poles, cables, or exchanges, and there’s not much eminent domain. The 1960s question was, “Who will build the heavy telephone infrastructure?” Today, who needs a heavy telephone infrastructure?

To say that liberty will take care of a problem need not be a shut-up argument, and it shouldn’t be used that way. But a free market operates on the principle that as long as people don’t initiate physical violence or fraud against anyone, anything else is okay.

Read the rest via Don’t Worship the Free Market : The Freeman : Foundation for Economic Education.

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