The Power of Saying “No”

When we were still dating, my wife once said to me: “I don’t like to be told ‘no.'” “No” is a word that a lot of people dislike — we don’t like hearing it, and many of us also have a hard time saying it. From a free-market perspective, however, it is a word that can have tremendous power, especially when large numbers of people use it at the same time and in the same way.

Back in June, I heard a conversation on “Bob Edwards Weekend” with the filmmakers behind Food, Inc., in which they made a point about the power that food consumers can wield by virtue of the fact that they make choices every day about where and what they will eat. Consumers tell companies what they like and dislike by the way they spend. We don’t have to look to state or federal governments to accomplish change in the food industry. If consumers let companies know that it’s important enough for them to maintain certain standards for the way their food is raised or prepared that they will favor businesses that conform to their preference, eventually even corporations as large as Walmart or McDonald’s will take notice.

Just a month or so ago, this principle was on full (and ironic) display. Many patrons of Whole Foods shop there because of the company’s commitment to high-quality natural and organic products. But when the company’s CEO published an op-ed advocating a free-market approach to health care reform and opposing President Barack Obama’s proposals, many previously loyal Whole Foods shoppers decided to take their money elsewhere to communicate their displeasure. This sort of revolt can be incredibly effective, although bringing these issues into such high profile might also inspire (as it did in the case of Whole Foods) new patronage from a group of people who had otherwise been disinterested in a company’s goods or services.

Utilizing such a “boycott” strategy, however, means that those saying “no” must be willing to give up goods and services that they would really prefer to have — at least until the market responds to their demands. And, because these consumers don’t want to give up those goods and services, they all-too-frequently utilize the coercive power of government to force providers to offer those goods and services on the consumers’ chosen terms.

Examples of this mentality leap from recent headlines. Don’t like the limitations offered by insurance companies, but you’re worried about going uninsured? Get your state government to mandate the kind of coverage you want. Wish that your favorite restaurant didn’t permit smoking, but you can’t bear to go without their signature dish? Get your city or county to pass a smoking ban. Want to build a corporate headquarters, but you can’t get the current property owners to sell at the price you want? Get your city to use eminent domain. Want an iPhone or a Blackberry Storm, but you don’t want to sign a long-term contract with AT&T or Verizon? Demand that Congress outlaw exclusive service agreements.

In every one of these examples, consumers have the power to change the market as long as they have the willpower to say “no.” Think health insurance premiums are too high? Refuse to carry insurance until a company offers a deal that you think is reasonable. Want to enjoy your meals without a smoky environment? Tell that restaurant owner that you won’t be back until his establishment has gone smoke-free. Don’t think that a property owner’s asking price is reasonable? Choose a different location or figure out a way to build around them. Prefer to stick with your favorite wireless service provider? Tell Apple or Blackberry that you won’t purchase their products until you are free to use them with a carrier of your own choosing.

The challenge here is that realizing the power of “no” in this context requires a willingness to sacrifice having something that you like in the short term so that in the long term you will be able to enjoy it under more favorable circumstances. Our nation still has a fast-food mentality when it comes to our desires, which is why it is so tempting to use the government as a shortcut to get what we want. But giving the government the authority to destroy someone else’s liberty — to the extent that they must give you what you want on the terms that you demand — is a double-edged sword. That same power can (and almost certainly will) be turned back against you.