Many claimed Microsoft was a monopoly and required government intervention to break it up. What is it’s position today? The free market takes care of monopolies.
Surely you understand that this is not always so, especially if the government itself enforces those monopolies. The anti-trust efforts of the early 20th century translated into several periods of unprecedented prosperity, each more wide reaching than the last, irrespective of whether the federal government was in a Keynesian mood. The Depression notwithstanding, the cycle of prosperity didn’t really end until the 1970s, when environmental costs could no longer be externalised, unions became parasitic, government became bloated, and energy ceased to be cheap.
Things worsened considerably under both Reagan and Clinton, as fedspend ballooned, and the utopian fantasy of “global free trade” took hold in both major political parties, under which core American productive assets were exported en masse to slave-wage countries, many of which are inherently hostile to American interests. Only a few lonely voices on the right (eg, Pat Buchanan) and left opposed this process, which has profoundly weakened the United States. It was a clear example of where the corporate interest and the sovereign interest were in direct conflict. Even if you removed all domestic regulation, environmental protection and jailed all the union leaders, the result would have been the same – the near annihilation of the American middle class.
A free people must retain the ability to mitigate the excesses of the market, without ever extinguishing it. And those prerogatives must be as locally centered as possible. That’s why the US Constitution is such an extraordinary document. What a tragedy that its core principles have been steadily whittled away, from both right and left.
Take, for example, hydraulic fracturing of shale hydrocarbons – a process capable of producing enormous wealth. Of course water supplies must be protected – there are real risks – but some communities will be willing to tolerate more risk than others, and risks can be mitigated through liability law and technology. At the same time, if you over regulate, only the largest players will be able to comply, compete and still earn profit. And the largest players are the most likely to funnel the wealth out of the area where it is produced.
In a truly free market system, landowners – of which, fortunately, there are millions in the US – would be in the best position to decide whether or not to allow drillers on their lands. They will look simultaneously for the best possible oil & gas royalties, for the strongest protections to ensure their lands are not spoiled for future generations, and for the strongest assurances that their land values won’t be destroyed when the drilling is finished. They will also have strong political influence over their township governments, which would normally have broad purview over permitting and fees. Some townships will reason that tourism and agriculture are worth more than gas revenues. Others will decide otherwise. Some places will have easily accessible gas & oil with few environmental risks. Other will have more complicated geology, more inaccessible reserves and more fragile ecological systems.
When there is corporate rule, such natural factors cease to dictate investment and returns. Pennsylvania is an excellent case in point. The industry literally wrote the gas fracking law (through ALEC) that was passed by the legislature. It removed virtually all the power townships once had to issue permits, which are now instead processed by a single government office in the state capital. That’s great for the corporations, which don’t have to deal with scores of townships, each with its own agenda. But it is profoundly anti-democratic, and robs the localities from prioritising their own development strategies. It leaves them without recourse or protection from sloppy operators, of which there are many.
And the process completely ignores questions of local geology and ecology. In some places, the shale is thousands of metres below the water table, making fracking much safer. In a truly free market, where social and environmental costs can’t be imposed on non-participants, that would lend a natural advantage to communities on that type of ground. In other places, the shale is dangerously close to the water table, meaning one sloppy operation can contaminate an entire aquifer. The law specifically prohibits any consideration of such factors when issuing permits. It also prohibits the disclosure of the chemicals used in the fracking fluids on specious “trade secrets” grounds. Such rules cannot possibly be in the public interest, though they are certainly in the interests of the corporations.