Free Market Mythology

The Republican base continues to tout the free market as a fair and just system of trade. The belief goes that supply and demand will maintain costs at a level that is sustainable for a healthy economy, thereby protecting consumers and encouraging the production of superior products and services. As well, advocates maintain that regulations drive costs upwards for both consumers and suppliers. But the theory only accounts for purely ethical conduct, on the part of suppliers, for the system to function. While there is some truth in the debate against over-regulation, unregulated markets pose more of a hazard against the best interests of the greater good. In practice, an unregulated market breeds monopolies, fraud and environmental hazards.

To nurture market relevance, and ultimately dominance, companies aim for exclusive control of their respective audiences. To do so, the stronger companies will prey on the weaker ones, either by forcing alliances or by driving down prices to unsustainable levels that asphyxiate competitors’ market share. This scenario alone invalidates the competitive marketplace the free market system depends on to sustain its built-in checks and balances. Also, when monopolies rise, consumers and laborers suffer massive losses while those at the top luxuriate in lifestyles akin to that of royalty. Monopolized markets breed this behavior simply because companies dehumanize consumers and laborers and in turn, pay wages at the lowest tolerable levels while producing the lowest quality products the consumer base will purchase.

Without fear of repercussion, banking institutions and corporations will engage in fraudulent practices. This became apparent in 2007 when the housing market spiraled out of control and saw home values drop in dramatic fashion; evidence of unethical conduct by lenders and the shadow banking system was uncovered as a result of the subprime mortgage crisis. Pacts will form between companies of varied enterprise to undermine competition; Rockefellers’ Standard Oil battle with Pennsylvania Railroad illustrated how trusts can transcend markets and become major deterrents to competition.

Unregulated industries have a negative effect on the environment, thus requiring restrictions to ensure the health and well-being of the communities affected. Hydraulic fracturing has been a hot button topic in energy debates with France banning the practice until sufficient proof is provided by energy experts ^[1] disproving the notion that the environment is negatively affected. Here is a practice that may be contaminating community water sources, with online videos having surfaced that demonstrate home faucets set on fire shortly after fracturing operations began nearby ^[2]. The BP Deepwater Horizon oil spill proved deadly to wildlife and tourism around the gulf region ^[3]. In an unregulated market, tragedies of this ilk would mount, leaving the moral majority at the mercy of pollutant-rich industries, praying they succumb to good conscience.

Unregulated, free markets have proven ineffective and saturated in fraud and unethical practice. To reinstate unregulated institutions, as once was the case for the New York Stock Exchange, would introduce financial disasters documented throughout history such as the market crash of October 24, 1929. Pundits arguing for free markets do so under ulterior motives; either they or their sponsors stand to benefit at the expense of hard working laborers, ethical conduct and the overall health of the economy. The free market is little more than a fabled invention whose aim is to benefit few and decimate the ability of the majority to maintain average, yet honorable, standards’ of living.