# Problems with the free market system **URL:** \ **Category:** Great Debates\ **Created:** [November 8, 2002, 7:16pm UTC](https://boards.straightdope.com/t/problems-with-the-free-market-system/135917 "2002-11-08T19:16:54Z")\ **Posts on this page:** 11\ **Page:** 2
**Author:** ![ElJeffe](https://avatars.discourse-cdn.com/v4/letter/e/958977/32.png) [@ElJeffe](https://boards.straightdope.com/u/ElJeffe)\ **Post date:** [November 15, 2002, 1:45am UTC](https://boards.straightdope.com/t/problems-with-the-free-market-system/135917/21 "2002-11-15T01:45:39Z")
> [@](#): > > Well, people will, in fact drive unsafe cars. We did for years because we didn’t know any better. And the car makers weren’t about to educate us. In the 1920’s-'30’s for example, if you drove a Model A Ford the fuel tank was in your lap. None of the cars had anything but ordinary plate glass in the windows, including the wind shield. People will prefer to drive cars that they believe are safer. That’s why all those ads on TV makes such a big deal about their car’s safety rating. Not all people are as concerned, of course. The type of person who will buy a Porsche is likely less concerned about safety than someone who buys a full-sized sedan coated with airbags. But as people become more eduacted, they will demand safer vehicles. Do you really think if someone came out with a car that was no safer than a Model A, that many people would buy it? I don’t think having the gas tank in your lap is a big selling point. Jeff ---
**Author:** ![Ludovic](https://avatars.discourse-cdn.com/v4/letter/l/7ab992/32.png) [@Ludovic](https://boards.straightdope.com/u/Ludovic)\ **Post date:** [November 15, 2002, 3:43am UTC](https://boards.straightdope.com/t/problems-with-the-free-market-system/135917/22 "2002-11-15T03:43:59Z")
> [@](#): > > \*Originally posted by erislover \* > \*\*The two Ukranians and one Lithuanian that I work with, and their famailies back in the former USSR, do not feel it was the market which caused their problems, but rather the massive resource-hogging done by once government officials and the like. … > \*\* It is well-known that Russia has comparatively fewer (almost none?) legal controls again Oligopoly. Same thing with the “robber baron” era in the U.S. (where things like trusts and equities/commodities market manipulation were rife). Now, is Russia’s example (of shady acquisitions by connected former officials) any worse than America’s robber baron era? That is a question I cannot answer, even though ostensibly the Plutocrats were acting under “free market” forces. The end result is the same: with fewer legal controls, it is easier to acheive conditions that are anti-utilitarian, i.e. do not result in the maximization of “happiness” (or military alertness, safety, what have you) Our current system has achieved, IMO, a more utilitarianly-successful out come due to the imposition of regulatory bodies such as the SEC, OSHA, and FDA. They may not be 100% effective but they are better than nothing. ---
**Author:** ![aahala](https://avatars.discourse-cdn.com/v4/letter/a/a88e4f/32.png) [@aahala](https://boards.straightdope.com/u/aahala)\ **Post date:** [November 15, 2002, 4:08am UTC](https://boards.straightdope.com/t/problems-with-the-free-market-system/135917/23 "2002-11-15T04:08:04Z")
Individuals will not always try to monopolize a market because: 1. There’s anit-trust laws which may have a chilling effect. 2. Those who build a giant company may not have been so driven by money or power. Once at the top, their other, more social interests may take over. 3. The managers of large corporations are often not the owners. Owners tend to want to maximize profit, but managers often wish to have an acceptable level of profit with a minimum of trouble. Of course, these factors do not always apply, so the attempt to monopolize exists. ---
**Author:** ![dal\_timgar](https://avatars.discourse-cdn.com/v4/letter/d/a88e57/32.png) [@dal\_timgar](https://boards.straightdope.com/u/dal_timgar)\ **Post date:** [November 16, 2002, 8:25pm UTC](https://boards.straightdope.com/t/problems-with-the-free-market-system/135917/24 "2002-11-16T20:25:11Z")
this “free market” idea is 200 years old. technology has changed a lot in that time, to use an understatement. the problem with the current version of the free market is “information hiding.” consumers don’t know what questions to ask and the marketing people probably can’t answer because the corporations only tell a given employee what he NEEDS to know. been there done that. never heard the word “benchmark” at IBM except when i brought it up. “I’ve got the equivalent of a Cray XP in my apartment and I don’t know what an electron is, DUH.” - Joe Blow “You MUST upgrade your computer every 3 years or your neighbors won’t talk to you.” - M. Dell How does a von Neumann machine work anyway? [http://presidentjackson.no-ip.org/knavelacademy](http://presidentjackson.no-ip.org/knavelacademy) Dal Timgar ---
**Author:** ![Urban\_Ranger](https://avatars.discourse-cdn.com/v4/letter/u/e9c0ed/32.png) [@Urban\_Ranger](https://boards.straightdope.com/u/Urban_Ranger)\ **Post date:** [November 18, 2002, 6:19am UTC](https://boards.straightdope.com/t/problems-with-the-free-market-system/135917/25 "2002-11-18T06:19:10Z")
> [@](#): > > \*Originally posted by sleestak \* > And your friend made this declaration based upon what? Because Economics are based on silly assumptions. > [@](#): > > \*Originally posted by sleestak \* > The US is the leader in the free market world. According to what? > [@](#): > > \*Originally posted by sleestak \* > Unless you can prove that regulated markets are out performing the US markets you do not have a case. In terms of what? Growth? Absolute value? Relative value? How do you measure a market? Is California a legit market? Is electricity one of them? ---
**Author:** ![Urban\_Ranger](https://avatars.discourse-cdn.com/v4/letter/u/e9c0ed/32.png) [@Urban\_Ranger](https://boards.straightdope.com/u/Urban_Ranger)\ **Post date:** [November 18, 2002, 6:22am UTC](https://boards.straightdope.com/t/problems-with-the-free-market-system/135917/26 "2002-11-18T06:22:35Z")
> [@](#): > > \*Originally posted by ElJeffe \* > For one thing, people try to avoid buying crap. If I buy a product expecting it to perform a certain function, and it doesn’t, I won’t buy that product anymore - I’ll go elsewhere. Are you sure, what about Windows? > [@](#): > > \*Originally posted by ElJeffe \* > The other concern, I suppose, is employers’ abuse of their employees. But this is also mediated by competition. You are assuming competition. The fact is any market will tend to create monopolies or cartels in the long run. ---
**Author:** ![Apos](https://avatars.discourse-cdn.com/v4/letter/a/838e76/32.png) [@Apos](https://boards.straightdope.com/u/Apos)\ **Post date:** [November 18, 2002, 7:57am UTC](https://boards.straightdope.com/t/problems-with-the-free-market-system/135917/27 "2002-11-18T07:57:12Z")
An aside: it’s kind of funny that people attack economics and especially free markets for the very things that economists have been talking about since Adam Smith observed the dangers of collusions, rent seeking, and so forth. None of these ideas are new insights into the problems that can arise in an economy that economists have overlooked. They’ve been a key part of the academic discussion for centuries. One thing often forgotten is that the government has historically HELPED collusion and rent-seeking behavior as much as it has hurt it, simply because it has been made the very sort of locus of economic power necessary to do such things. ---
**Author:** ![Apos](https://avatars.discourse-cdn.com/v4/letter/a/838e76/32.png) [@Apos](https://boards.straightdope.com/u/Apos)\ **Post date:** [November 18, 2002, 8:04am UTC](https://boards.straightdope.com/t/problems-with-the-free-market-system/135917/28 "2002-11-18T08:04:10Z")
—Are you sure, what about Windows?— There’s a lot pretty sloppy thinking in regards to windows. First of all, operating systems, at least at our current level of technology, have a pretty steep network externality. That means that the benefits of something increase faster than the rate at which new people buy it: because for each new buyer, the OS becomes more useful to everyone who already has it: in terms of convience, concentration of programing efforts, compatability, training, etc. So we may have a case here where it would be inevtiable that, at least at this stage of development, a single OS would come to dominate: a sort of natural near-monopoly. Windows has tons of problems. It’s bloated as hell. But what’s often overlooked is that a lot of this bloat comes from being in the sort of market it’s in, and the vast multitude of legacy software and hardware it has to support, as well as needing to pitch at consumers with flashy offers, co-brandings, and so on. ---
**Author:** ![David\_Simmons](https://avatars.discourse-cdn.com/v4/letter/d/9de053/32.png) [@David\_Simmons](https://boards.straightdope.com/u/David_Simmons)\ **Post date:** [November 22, 2002, 4:36am UTC](https://boards.straightdope.com/t/problems-with-the-free-market-system/135917/29 "2002-11-22T04:36:24Z")
> [@](#): > > \*Originally posted by ElJeffe \* > \*\*People will prefer to drive cars that they believe are safer. That’s why all those ads on TV makes such a big deal about their car’s safety rating > > Jeff \*\* This is a result of almost 50 years of the safety gurus pushing the federal government into making and enforcind safety standards for automobiles and educating the public about them. Ford emphasized safety in their 1956 models and had a real bad sales year. The US auto industry was supposedly competitive at that time and would have done little if anything about auto safety or trying to convince people that safe is better absent coercion. ---
**Author:** ![msmith537](https://avatars.discourse-cdn.com/v4/letter/m/d9b06d/32.png) [@msmith537](https://boards.straightdope.com/u/msmith537)\ **Post date:** [November 25, 2002, 12:36pm UTC](https://boards.straightdope.com/t/problems-with-the-free-market-system/135917/30 "2002-11-25T12:36:17Z")
> [@](#): > > \*Originally posted by Urban Ranger \* > Because Economics are based on silly assumptions. > \*\* Like what? Economics is based on some very basic assumptions: - There is no free lunch (or if you prefer you must put in what you get out) - People want to pay as little as they have to in order to but something - People want to receive as much as they can when they sell something I suspect that if you think economics is silly, you don’t really understand it. ---
**Author:** ![David\_Simmons](https://avatars.discourse-cdn.com/v4/letter/d/9de053/32.png) [@David\_Simmons](https://boards.straightdope.com/u/David_Simmons)\ **Post date:** [November 25, 2002, 3:23pm UTC](https://boards.straightdope.com/t/problems-with-the-free-market-system/135917/31 "2002-11-25T15:23:21Z")
> [@](#): > > \*Originally posted by Apos \* > **An aside: it’s kind of funny that people attack economics and especially free markets for the very things that economists have been talking about since Adam Smith observed the dangers of collusions, rent seeking, and so forth. None of these ideas are new insights into the problems that can arise in an economy that economists have overlooked. They’ve been a key part of the academic discussion for centuries.** True such actions have always been present, and “competition and the free market” haven’t yet furnished corrective action, have they? > [@](#): > > \*\*One thing often forgotten is that the government has historically HELPED collusion and rent-seeking behavior as much as it has hurt it, simply because it has been made the very sort of locus of economic power necessary to do such things. \*\* Only when the fox is put in charge of the henhouse, as is now the case. [Previous page](https://boards.straightdope.com/t/problems-with-the-free-market-system/135917.md?page=1)