There tends to be occasional confusion in the media about how exactly to pigeonhole the Show-Me Institute. One of the most common inaccurate labels is “conservative,” and “right-wing” would probably take second place. We’ve always been careful to distinguish ourselves as a “free-market” think tank — but many people aren’t sure what that entails, either, presuming it to be perhaps a dissembling appellation for corporate apologists. But, as famed economist Milton Friedman put it, “There’s a common misconception that people who are in favor of a free market are also in favor of everything that big business does. Nothing could be further from the truth.”
Over at Cato Unbound this week, philosophy professor Roderick Long has written an essay that outlines some crucial differences between free markets and state-supported corporatism (link, along with some thoughtful commentary, via my pal Wirkman Virkkala). Essays of response and discussion will be posted online presumably every day or two throughout the next couple of weeks, as per the usual Cato Unbound format. In today’s essay, though, Long got off to a powerful start:
Corporations tend to fear competition, because competition exerts downward pressure on prices and upward pressure on salaries; moreover, success on the market comes with no guarantee of permanency, depending as it does on outdoing other firms at correctly figuring out how best to satisfy forever-changing consumer preferences, and that kind of vulnerability to loss is no picnic. It is no surprise, then, that throughout U.S. history corporations have been overwhelmingly hostile to the free market. Indeed, most of the existing regulatory apparatus—including those regulations widely misperceived as restraints on corporate power—were vigorously supported, lobbied for, and in some cases even drafted by the corporate elite.
It’s no coincidence that the Show-Me Institute’s board of directors designated that one of our six policy areas would study the adverse effects of corporate welfare.