Libertarian Rebuttal – The U.S. Government Is More Democratic Than The Free Market

This is a strange argument that I’ve heard quite a few times now. It seems to be pretty popular. I heard Jon Stewart use it on the Daily Show and he got a huge round of applause for it. My mom told me that she has some friends who used it at a dinner party not too long ago as well.

The argument goes something like this: It is much better to be ruled by democratically elected politicians than by corporations. After all, if a politician oppresses us we can vote him out of office. Therefore, the politician’s loyalty is to the electorate. On the other hand, a corporation’s duty is to its shareholders. The shareholders don’t care one way or the other how management brings in the dough. Since it isn’t a corporation’s job to protect their customers and they only care about making profits for their investors, they will lie, cheat, steal, and screw ordinary people in order to make money. Citizens have no say in who runs these corporations. They are at the mercy of big and powerful business interests.

A libertarian can intelligently debunk this argument using the following plan of attack.

1. Explain that when a free trade takes place, everybody wins. Those who think that rich corporations rip off and take advantage of poor, defenseless people have a misconception of the nature of trade. They think that trade is a zero sum game. There must be a winner and a loser in every transaction. The winner ends up with the money and the loser gets stuck with the item purchased. This is false. In reality, in every market transaction, voluntarily undertaken, there are two winners. Free trade is a positive sum game. If I go to the grocery store and buy a box of cereal, I desire the cereal more than the amount of money I spend on it. At the same time, the grocery store would rather have the money than keep the cereal in inventory. We are both winners, otherwise the transaction never would have taken place.

2. Support for free markets doesn’t mean tolerence for fraud, theft, and property violations. It is very important to make clear that the protection of property rights is the cornerstone of a free market society. All property must be parted with voluntarily. Contracts must be enforced. Fraud is akin to theft. Property must be protected. This is key to explaining the free market position. Anti-capitalists hate the market because they imagine it as a predatory environment with no protections. However, libertarians must be supportive of some law enforcement agency. If a vendor misrepresents what they are selling to you, that is a violation of contract and punishable. Scumbags who go around lying to the elderly in order to take their money are committing fraud and must be brought to justice. It is impermissible to pollute on somebody else’s property or poison their drinking water. In the long run, market discipline is the harshest of all discipline. When the word gets out that certain companies are ripping people off, fortunes will be lost and lives will be ruined.

3. Shareholders can only get rich if management makes customers happy. In a free market economy, corporations can only make money if customers voluntarily buy goods and services. The best way to make money, then, is to give the client what they want, how they want it, and at a price that they can afford. The old saying is true “The customer is always right.” Anybody who has actually run a business can attest to the persnickety nature of customers. If things aren’t just so, they won’t make a purchase. It follows that if a corporation wants to please its shareholders, there is only one way to do it: make customers so happy that they buy. There is absolutely no conflict between making profits for shareholders and serving clients. In fact there is a completely harmonious relationship between consumers and shareholders. Consumer contentment causes profits. If management stops making customers happy, they will feel the wrath of the consumer, shareholders will lose money and new companies, who have a better idea of how to treat people, will take their place.

4. Government doesn’t get its money voluntarily. The relationship between citizen and government is not voluntary. If the government offers a service that a person doesn’t like or want, it doesn’t matter. They get it anyway. Take for example the wars in Iraq and Afghanistan. Nearly half of the American people are against these wars, yet they are forced to pay for them. People are forced to receive protective services that they’d rather not have and would choose not to pay for if they had the choice. They don’t have a choice though. In fact, anybody who chooses to not pay for services that they didn’t ask for and don’t want will be thrown in the clink. Three hots and a cot. There are a million other government services there we could examine from food certification to financial regulation and on down the line. If these are such good services, people will voluntarily pay for them. If they seem like a rip off, why should anybody be threatened with incarceration for opting out? The harmony that exists in the free market is replaced with aggression.

5. You can vote people out of office but you can’t eliminate the power of office. It is true that government officials are elected democratically. If a politician acts in a way that is particularly egregious, that person can be replaced. This is fantastic. However, there is no assurance that the next politician won’t be a monster as well. Even if the politician only has two years in office, that is still enough time to secure a substantial amount of loot. No matter who represents us in government, that person will have the power to write laws that take money from us. There is nothing we can do about that, it is baked into our system of government. Even is we elect a saint, there are still hundreds of other politicians that can override our man’s good deeds. We are at the mercy of the power of office and voting new in new officials doesn’t guarantee us anything.

6. The free market is über-democratic. Every time you reach into your pocket for your wallet to make a payment, you vote. Do you prefer locally grown produce? Cast your vote…with your own money. How about organic beef? Cast your vote. Sugary cereal? Step right up and fill out the ballot. The more people like something, the more it will be produced. If people don’t like it, it will disappear. This is ruthless democracy at its most honest. In the market, people don’t vote for what they think might be kinda right, they vote for what they really, truly, strongly desire. If people want philanthropy, they’ll get that too…as long as they vote for it with their pocketbook.

To recap, listen for the following argument: Its better for society to be run by democratically elected politicians than by corporations. If a politician treats us bad, we can get rid of him. Corporations are only loyal to shareholders who don’t give a damn about regular people. It isn’t a corporation’s job to protect customers, its their job to make profits. They’ll lie, cheat, steal, and screw us to make money. Citizens can’t vote for who runs these corporations. We’re better off having elected government officials run the economy.

Rebut using the following six points:

1. Explain that when a free trade takes place, everybody wins.
2. Support for free markets doesn’t mean tolerence for fraud, theft, and property violations.
3. Shareholders can only get rich if management makes customers happy.
4. Government doesn’t get its money voluntarily.
5. You can vote people out of office but you can’t eliminate the power of office.
6. The free market is über-democratic. 

If you stick to this script and speak your piece firmly yet humbly, you might just win somebody over today. Get out there and give’em hell.

Adam Pearson


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