If Free Markets Actually Prevailed

In a piece at RealClearMarkets Walter Block paints a rather rosy picture of what the United States would be like if free markets actually prevailed:

Government regulation and taxes, if they existed at all, would be very minimal. There would of course still be laws against murder, rape, theft, assault and battery, fraud, and upholding contractual rights, but that would just about be it. Most people would be as aware of who the president is as much as they now know the names of the dog catcher, the chief librarian, or the parks commissioner in their town. That is, they would be blissfully unaware of their identities. There would either be no crime at all, or muggers would be so cowed by the few necessary policemen that they would for all intents and purposes cease and desist. They would still have criminal impulses; “libertarian man” would be pretty much as he is now, but greatly constrained.

As a result, we would be roughly four times richer than we are now. Calculation? The state at present seizes some half of our incomes; absent that, we would be twice as wealthy. But don’t the bureaucrats give us value in return? Not really; GDP statistics would be far more accurate if instead of adding the government sector expenses to what is produced in the market, we subtracted the former from the latter. What do the revenooers do with their 50% of our productivity? They vastly reduce our productive capacities with their inefficient and stultifying regulations. Without that, we arrive at our second doubling: 2×2=4.

I don’t believe that things would be quite as lovely as he thinks. Let’s take him quite literally at his word and make a list of how things would be different.

There would be no patents, copyrights, or other intellectual property. The limitation on enforcement in those lines would be what was in your contracts and they would last as long as the contracts. That would greatly reduce the incentives to produce new inventions.

Caveat emptor would prevail.

There would be no public highways, bridges, ports, airports, sewer systems, air traffic control, etc. All of those would be private to the extent they existed at all. All roads would be toll roads and the number of tolls extracted on a trip across the country would be enormous. I notice that torts are not included in his list. If a bridge collapsed or you were injured by using a tool you had purchased, you would have no legal recourse.

There would be no inspections or regulations of food or pharmaceuticals. A lot of the food and drugs sold would be unsuitable for consumption. Unless you could prove intent you would have no legal recourse.

There would be no licensing or certification of lawyers, physicians, or engineers and, consequently, there would be far fewer of them. There would be no restrictions on the pharmaceuticals that could be sold or any guarantees of effectiveness that weren’t made by the manufacturers themselves. If they were clever enough they could avoid claims of fraud.

There would be no public schools. All students would either be homeschooled or attend private schools. The children of the poor would receive little or no education.

There would be no public fire departments. Insurance companies might have have their own fire departments and, if your house caught fire and you didn’t carry the insurance of the company with the closest fire department, it might well burn to the ground.

Refusing business to someone due to their race, ethnicity, or religion would be completely legal.

If your bank became insolvent, you’d just be out of luck.

There would be no public parks or green spaces.

I could go on and one with this list but I’ll stop there. And I haven’t even gotten to the military. It would be impossible to fund a standing modern military in the low government footprint world he envisions. How do I know these things are what would happen? That’s exactly what things were like in the late 19th century, before the reforms that led to the expansion of government to manage free markets.

That may sound idyllic to Mr. Block or to you but it does not to me.

It could reasonably be claimed that’s not what Mr. Block intended. I suspect it was not but as you fill in the blanks he has left, the scope and cost of government increases.

I am not Panglossian enough to argue that we are living in the best of all possible worlds but I will claim that things could be worse and one of the ways of making them worse is to follow Mr. Block’s guidance blindly.