Death of the Free Market

I've come to a point in my life, later than some and earlier than others, where I realized that a lot about America, maybe most of it, is illusion. I truly don't believe that the America many of us believe in exists, or ever existed. The latest casualty to me is the free market, or at least politician support of the free market.

Over the last few years, we've heard a lot about the free market, privatization, capitalism, etc. We've heard a lot about it because President Bush, and Republicans in general, are big supporters of these notions, supposedly. These folks, and many conservative leaning pundits like Bill O-Reilly, Ann Coulter, and Sean Hannity, believe in this both on the macro economic scale and on the micro level of the individual. They seem to believe that both individuals and companies should compete and whoever wins, well, they were better somehow and deserved to win. Kind of a funny notion for folks who often criticize Darwinian notions of natural selection and evolution.

Regardless, on a macro scale, the notion is that private sector competition is good and that it leads to higher quality, lower prices, etc. In theory, this is a fine idea. But what it also means is that some companies and private entities will not succeed. It doesn't matter if they are a historic name or have friends in high places. If they can't cut it in the marketplace, then they're done. Too bad. But that's the ruthlessness of the the jungle.

Ah, but the problem is that the same folks who worship at the altar of the free market economy don't really believe in it. They believe that it only applies in some circumstances and not others. They believe it only applies to some companies and not others. So when Obama wants to tax higher earners and corporations and give tax breaks to moderate and low earners, it's socialism. However, when we provide special low-interest loans to General Motors, that's just fine and dandy. When we provide billions in public dollars to bail out investment firms and banks, that's not welfare. It's just prudent fiscal policy. It's not a free market economy when we tinker with it and prop up entities that would otherwise whither and die.

And it's not just national. On the local level, the Public Utilities Commission of Ohio (PUCO) recently granted the gas companies the ability to raise delivery rates for gas to consumers. The rate increase will not be based on usage so folks living in tiny houses or apartments will pay the same delivery charge as LeBron James will pay in his castle. The gas companies wanted this increase because, after years of prodding people to do so, customers actually began to conserve, especially as gas prices shot up. People lowered thermostats, bought energy efficient appliances, etc., and started using less gas. Given this, the gas companies have no convenient way to sustain there profit margin so they pressured the PUCO for this increase. They originally proposed an even more egregious pricing scheme but there was enough public outrage to end that one. Still, the end result is that people are going to pay more for natural gas service even if they've been doing what they can to conserve.

This is ridiculous. To me, it is nothing short of price fixing. That is not the free market. I used to own a company that primarily scanned documents for lawfirms. Over time, that service became a commodity and prices dropped precipitously. I didn't like that. I liked it much better when I was making a higher profit margin. But I couldn't just say to customers that I was now going to implement a document pick-up charge to offset my other losses. I couldn't do that because my industry doesn't have a PUCO. My competitors, who might have been better able to absorb the scanning price decrease, would not institute additional charges and I'd be out of business. That's how the free market works. I was a small company. No one cared if I survived or not. I didn't contribute to local political campaigns. I didn't have any lobbyists. Politicians like the free market for people like me.

The fact is that the free market just doesn't apply to certain entities. And if it doesn't apply to some, then it really doesn't apply to any. It's just another fallacy in this joke of a nation, along with free speech and the idea that any American can grow up to be president. Lately, my best friend has reminded me of George Carlin's notion that really all you can do about any of this is stand back and laugh. Carlin acknowledged that it was sad to see a nation of such promise chronically underachieve but he ended up realizing that instead of being sad or angry, you just have to enjoy the show. I'm not there yet but I'm getting closer. A post like this would have riled me up a few months ago. Now I just think it's comical that anyone still believes in any of this crap.