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Home Publications Blogs Beat the Press Real Supporters of the "Free Market" Do Not Believe that Companies Can Pollute Drinking Water With Impunity

Real Supporters of the "Free Market" Do Not Believe that Companies Can Pollute Drinking Water With Impunity

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Monday, 20 January 2014 08:43

A Washington Post article on the issues involved in relationship to the chemical spill in West Virginia identified the Competitiveness Policy Institute as a "free-market think tank" in presenting its views opposing increased regulation of dangerous chemical. This is inaccurate.

Supporters of the free market do not believe that others can damage life and property with impunity. For example, it is not consistent with a free market to think that anyone can dump toxic chemicals on Bill Gates' lawn. Protection of life and property are fundamentals of free market economics.

In this case, it is likely that the company responsible, Freedom Industries, will largely escape responsibility for the damage it caused with its actions since it declared bankruptcy. This means that the victims of the spill were effectively forced to give money to Freedom Industries. This is antithetical to free market principles. A think tank that supports such outcomes should be labeled as a proponent of upward redistribution, not a supporter of free markets.

 

Typo corrected, thanks Dax.

Comments (12)Add Comment
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written by dax, January 20, 2014 8:56
"within impunity" should be "without impunity"? Or is my English slipping?
Austrian school says there's no such thing as market failure
written by William Berkson, January 20, 2014 9:16
So von Mises and his followers—probably including Paul Ryan—think there is no such thing as market failure. These folks in WVa just wanted to take the risk and pay for the clean up. And Friedman and the Public Choice people say there is market failure, but government intervention is always worse: http://en.wikipedia.org/wiki/Market_failure

I know, crazy, but am I wrong that these are real supporters of the "free" market?
No such thing as "free market"
written by Steve Bannister, January 20, 2014 9:24
Dean, in your ongoing battle for accurate reporting and truth, I think you should eschew ever using "free market" without quotes, as removing the quotes accepts the Austrian's institutional framing. I note that many Econ texts do not include the term at all since the only feasible formal definition is a purely competitive market and, the conservative's gods know, whoever would want that?
By 'free market'..
written by ifthethunderdontgetya™³²®©, January 20, 2014 9:51
.
They mean "let the people with all the money* do whatever they want to the rest of us."

* Coincidentally, the very same people who fund propaganda mills like the Competitiveness Policy Institute.
~
"free market" or not it's pretty stupid
written by Jennifer, January 20, 2014 9:55
"Angela Logomasini, a senior fellow at the Competitive Enterprise Institute, a free-market think tank, said: 'I don’t think that more regulations are going to make us safer. The key is controlling exposure, because that’s where the real risk is.'"

Umm and "controlling exposure" has nothing to do with regulations?
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written by watermelonpunch, January 20, 2014 10:02
written by William Berkson, January 20, 2014 9:16

am I wrong that these are real supporters of the "free" market?


You're not wrong if:
You accept that "real supporters of the "free" market" are actually delusional hypocrites.

I mean think about it - the only reason you have rights to property is because you can call the GOVERNMENT in (police) to help you enforce the laws the GOVERNMENT issues.
Otherwise... people would just be able to "freely" take property at the point of a gun.

And going even further with that...
Can individuals really have any power that way?
There will always be people who band together (army or militia) to take things by force in those circumstances.
And what do you call those organizations of people?
I think it's called "government".
If you want a good government, it's done with laws & procedural enforcement.
What do those free market guys want? Who's going to REGULATE that nobody can form organizations? You'd need a GOVERNMENT to stop it, and allow individuals to operate.

Whatever way you cut it... the logistics of reality don't support the free market ideology at all, I'm afraid.
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written by skeptonomist, January 20, 2014 10:21
The ideal "free market" does not include mechanisms for safeguarding against depletion or pollution of natural resources, including the climate itself. This is something that can only be done collectively, and that means government control. Such safeguards are becoming more important as the world population increases.

Free markets do some things well, but other things can only be done by government. There is no reason to suppose that free markets tend to an equilibrium state of perfect competition; in fact all the evidence is that a given market tends over time to oligopoly or monopoly, which leads to political influence for the monopolists, which eventually ends competition gives most of the rewards to a few. Unregulated "free markets" are an absurd utopian fantasy, and economists who would call themselves liberal should not refer everything to an ideal free market.
Yes, the 'free market' is a con
written by William Berkson, January 20, 2014 10:28
Steve Bannister, I agree with you that the 'free market' is a bogus propaganda term. The term "free enterprise" came in the 20th century as a more benign sounding term for capitalism: http://en.wikipedia.org/wiki/Capitalism (see just before the Contents). "perfectly competitive markets" have the meaning of perfect knowledge, rationality, no barrier to entry etc. "Free market" seems to be a mash-up of the two, meaning essentially the same thing as laissez faire, which interestingly is not the same a promoting competition. Adam Smith was opposed to laissez faire, because he thought government intervention is regularly necessary to prevent merchant collusion for price fixing, and monopoly. But the point is that it actual has nothing to do with political freedom in its meaning. The effect is that everything done to advantage the power of the rich is done in the name of 'freedom'. If anybody has a reference to the history of these terms, I'd love to see it.
...
written by skeptonomist, January 20, 2014 10:39
I think the general idea of "free markets" as an ideal came into being as a replacement for previous economic systems, especially feudalism and mercantilism. When Adam Smith expounded the advantages of less restricted markets, this was actually a progressive idea. Through the 19th century the disadvantages of capitalism became more obvious and alternative utopian systems were devised. By now it should be clear that unrestricted capitalistic "free markets" actually tend over time to resemble aristocratic feudalism.
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written by elbok, January 20, 2014 11:01
There has not been, never will be, and is not now anything called a 'free market' since the end of the barter system. A truly free market implied no 'gubmint' restrictions and the freedom to sell, to contract, and to act as one sees fit within the confines of the relationship with the other person (buyer/seller). People who speak of the free market make me realize they are simply put morons who do not understand what they're saying. Or as the blessed Inigo Montoya says: "You keep using that word. I do not think it means what you think it means."
Competition Among the Predators ... to Take Your Property
written by Last Mover, January 20, 2014 11:08

In the article a representative of the Competitive Enterprise Institute says absurdly, it's about controlling exposure to the chemicals, not more regulation of the chemicals themselves for which ... exposure criteria and controls are obviously impossible because no fatality thresholds have been established in the first place to prioritize risk ... for lack of regulations necessary to provide the information that were blocked long ago.

It's kind of like the mystery meat scandal. No one knows what's in it. Since when does transparency have anything to do with "competition" anyway? That's for the seller to know and the buyer to find out, right?

You know, how they do it in restaurants. No one has any idea of what they're eating do they? No beforehand safeguards whatsoever. They just wait to see if people start to keel over so the rest know to stop eating don't they. There's your free market unfettered transparency at work.

Since it works in restaurants, why not let it work in the water supply? Live testing for exposure in action, then use the feedback to tabulate new marketing information for future consumption. If you're afraid to go first, just give your pet a drink before you take one.

Consider the savings. No mountains of regulatory red tape to account for the myriad of ever changing chemicals involved. Just monitor the results and adapt with the usual creativity and innovation typically assigned to employable Americans with lots of structural skills.

Competitive Enterprise Institute?

How about Economic Predator Institute?

Seriously, the concept of "competition" has been bastardized like "patriotism" into the last refuge of a scoundrel.

The last refuge of an economic predator is "competition" advanced in all its fake forms intended to disguise and avoid effective competition, which includes in this case, the absence of huge negative externalities laying around in chemical tanks just ready to take your free market property away from you, as Dean Baker explains.
No True Scotman
written by Chris G, January 20, 2014 8:14
> Real Supporters of the "Free Market" Do Not Believe that Companies Can Pollute Drinking Water With Impunity... A think tank that supports such outcomes should be labeled as a proponent of upward redistribution, not a supporter of free markets.

True enough but the argument verges on pedantic. "Conservatives" aren't conservative either. (Colloquial usage of the term is a pet peeve of mine.) Merriam-Webster definitions go by the wayside for some terms. Have "free markets" ever been about protection of life and property of the general population? Please. Free markets are about socializing costs while privatizing profit and, more generally, hanging negative externalities on people who lack the power to prevent it.

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About Beat the Press

Dean Baker is co-director of the Center for Economic and Policy Research in Washington, D.C. He is the author of several books, his latest being The End of Loser Liberalism: Making Markets Progressive. Read more about Dean.

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