The Myth of the Free Market
Many Republicans toss around the term Free Market as the solution to almost everything. However, what they’ve forgotten is that we don’t actually have free markets. IMHO, the closes we have to a free market is eBay.
A free market requires a number of things: no barrier to entry for suppliers; suppliers who do not lie to the customers; customer who have access to accurate information about all suppliers; and customers who make rational decisions.
IMHO, none of these exist in general society:
Barrier to entry
For example, air transportation has huge financial and governmental barriers to entry; auto industry is the same; steel manufacturing; gasoline exploration and refinement; hospitals; becoming a lawyer or doctor have barriers. Everything has barriers, so there can never be a truly free market.
Suppliers deceive customers
IMHO, the whole point of advertising is to deceive customers: this pill will make your sex life great; this car will make you hip; this toothpaste will make your teeth cleaner and get you a date; this shampoo is will get you a date; this vacation will make you happy. The argument is that suppliers are just providing information - if that’s true, have you ever seen an advertisement that told you the disadvantages of a product in the same manner as the advantages - rather than in tiny text or sped up voices in 5 seconds after a 55 second commercial?
Customers have accurate information
There are about 30 brands of toothpaste, each with at least three different varieties: there is no way a consumer could get complete and accurate information on all of them; there is no way to find out how many passengers died in-flight on a given airline (or cruise ship); there are hundreds of different makes and models of cars; there are no “lists of ingredients” in restaurants.
Customers are rational
48% percent believe aliens have visited earth.
37% percent think that it should be illegal for two men to have sex.
In this poll from the 2004 election, half (50%) rightly name Bush as the candidate who favors giving parents tax-funded vouchers to help pay private or religious school tuition, thirteen percent attribute the plan to Kerry, who actually opposes it, over a third (37%) admit they don’t know. From an AP story after Katrina, nearly one-third of young Americans polled couldn’t locate Louisiana on a map and nearly half were unable to identify Mississippi.
My Conclusion
So, IMHO, since none of the basic premises of a Free Market exist, confidently claiming that the Free Market can do anything is a subjective statement, completely unsupportable by any economic theory that includes supply and demand as any part of its premise.