The market is not a system. It is a battleground on which the bargaining power of buyers battles the bargaining power of sellers with no guarantee that they will be anywhere close to equal. Where they are close you get high quality and low prices. Where they are not you get low quality and high prices which in turn degrade the efficiency of the economic system.

On top of that, the market recognizes only two parties to the transaction and is unable to take into account the benefits and damages any transaction imposes on third parties. A seller and a buyer may strike a low price which arises from the seller polluting the environment or cutting down the redwoods or leaving half the population exposed to an epidemic. Those costs are not and cannot be factored into the price by the market alone, but if they were able to be taken into account the price would be far different.

That’s why we have pollution laws and publicly-funded immunizations, two things that extreme market supporters oppose. To them, the market is a hammer and everything else is a nail. — David Grace

Graduate of Stanford University & U.C. Berkeley Law School. Author of 17 novels and over 200 Medium columns on Economics, Politics, Law, Humor & Satire.

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