Libertarians argue that the market will price everything properly, including safety and environmental concerns. If only that darned big government didn’t swoop in and mess that beautiful thing known as the free market from working its mythical magic.
What they forget, is that big companies naturally tend towards monopoly: that is, as they get bigger, they can buy out the competition. If it weren’t for the essential government function of anti-monopoly oversight, we would have one super-company very quickly. There would be no apple, only IBM. There would be no Burger King, only McDonalds.
What they also forget, is that the market simply does not care about certain factors, at least not as much as we would like it to care. For example, oil rig explosions. The libertarians will say that companies will self-regulate , and avoid excessive risks of oil spills, since if they had too many spills, then the public would become frustrated at them, and would not buy thier products, but would instead buy the products of their competition, as a punishment for their negligence. But in a world where the oil companies control the flow of information so strongly, how much does consumer choice actually reflect consumers’ preference? And this is also ignoring the much more obvious question, which is, how many spills would the market tolerate, vs. how many poeple of good conscience would tolerate, for the good of society?
In Nigeria, there are oil-producing regions which have been so under-regulated, that the entire delta of the Niger river is awash in oil. The wildlife is dead, and the people in the region drink from poisonous wells. But the people of the delta have virtually no money, and so the market does not respond to their concerns. Instead, the rich people in the first world are buying their gas, and they do not care in the slightest about damage done to the Niger delta. In order for the market to work for the people of Nigeria, they first have to become rich. But they cannot, really, since the oil monopolizers do everything possible to pay them nothing, and local government is corrupt and in the pockets of the oil companies. Clearly, the market will not serve those people. (more…)