At EconLog, Arnold Kling knocks down a favorite leftist straw man: the infallible market. By citing suboptimal outcomes that result from market transactions, such market critics believe, they can justify state intervention. But, as Kling makes clear, that just doesn’t follow.
1. Unfettered free markets nearly always produce sub-optimal outcomes.
2. When economists or other technocrats know how to use public policy (taxes, spending, regulation) to improve outcomes, they should be given the authority to do so.
3. Technocrats know how to improve outcomes in many areas.
4. Therefore, it would be wise to cede authority to technocrats in many areas.
5. Conservatives and libertarians disagree with (1) and (2)
(5) is something that I am suggesting that progressives believe. However, if progressives believe this about me, they are wrong. I disagree with (3) much more than I disagree with (1) or (2). I think markets nearly always produce sub-optimal outcomes, and I think that if technocrats know better they deserve a shot. However, I think that most of the time technocrats know far less than they think they know, and I think that markets are often better at self-correcting than technocrats are at fixing them. Hence, my Masonomics line is that “Markets fail. Use markets.”
If as a Progressive you believe (1) -(3) but think (4) sounds totalitarian, then that is your dilemma, not mine.
Indeed, leftists like to deride “market utopians.” Unfortunately for them, there is no such creature.