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(NaturalNews) I'm a big free market proponent. I love the "freedom" in it... the individual decisions of hundreds of millions of people coalescing into an "invisible hand" of efficiency improvements, quality of life enhancements and unlimited abundance. That's the Alice-in-Wonderland version of the free market economy, anyway. In reality, the free market is broken. It doesn't work (at least not as we once hoped it would), and it can't last. In fact, unless some important changes are made to the way in which it works, the free market will lead us to the destruction of human civilization.
How, you ask? Let's answer that question by looking at free market theory, which says that individual consumers will intelligently evaluate their production and consumption options, then make an intelligent decision to produce those things that provide the greatest profits (by indirectly providing the greatest benefits to others) while purchasing / consuming those things that provide the greatest benefits to themselves. In theory, it sounds downright elegant, but in practice, there's a huge problem with all this: Consumers are not rational!
Why consumers cannot (and will not) make rational decisionsExamine the interaction between Big Pharma and consumers, for example: Drug companies use campaigns of disinformation, deception, exaggeration and scientific fraud to convince consumers they suffer from various "diseases" requiring chemical intervention. Believing this mythology, consumers then trade their hard-earned money for these chemicals that actually harm them! Spending on pharmaceuticals and "sick care" services accounts for over twenty percent of the U.S. economy. So how is this consumer behavior accounted for in the free market?
It isn't. There's no modeling for massive corporate deception in free market theory. Free market theorists merely assume that consumers are rational, that companies are honest and that people have a reasonable capacity to intelligently evaluate the products and services they choose to purchase. All those assumptions, however, quickly fall apart in the real world. Consumers are irrational, companies are dishonest and the people have virtually no evaluative skills necessary for making informed purchasing decisions.
The consumption of pharmaceuticals makes all this as plain as day, and yet pharmaceuticals are just the beginning of this story.
Buy more crap you don't need!Consumers in America have also been convinced to purchase useless (but highly profitable) home cleaning products like Swiffer devices, which are branded, disposable home cleaning products that have no real purpose for existing other than being sold to people. A regular old sponge mop does everything that Swiffer does, without the repeated expenditures on disposable sheets, without all the brand-name advertising and without all the wasted packaging and shelf space in retail stores.
And yet consumers keep buying Swiffer products (and throwing them away). Why? Because consumers are irrational, of course, and Swiffer advertisements are quite good at compelling people to make purchasing decisions that are not in their own long-term interests.
The list goes on: Paper clips that slip off papers and are easily lost, light bulbs that burn out and need replacement, showers soaps that dissolve away at the merest touch of water... these are all examples of products that succeed in the free marketplace even though they are inferior, wasteful products.
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Thursday, April 23, 2009
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