Market ideologues are a group that believe in the supremacy of the market. Their belief may be based on what they learnt in Economics 101 or on what works best for them.
Their problem, and a problem for all of us when market ideologues gain power, is that market ideologues refuse to accept evidence of market failure even when it is staring them in the face.
Of course, they find it hard to see it as a failure when market supremacy is delivering a larger share of wealth to the top 1%, so we need constantly to remind them and everyone else by looking at data. The evidence shows that if we define success, as delivering outstanding healthcare and education for all, or tackling climate changes, then the market is hopeless. It is not hard to understand why. The market can only work if there is effective competition, and effective competition, according to the last great Chicago school economist Henry Calvert Simons, requires that no market participant should monopolise more than say 10% of market share. This works great for say real ale where there hundreds and hundreds of producers, so when I look at the selection of real ales on offer in my local pub I am right in thinking “Ain’t capitalism great!” But when I reject the ticket price of the monopoly bus operator on my route to work, and instead find myself sitting in a traffic jam with all the other cars, I am also right in thinking, “Ain’t capitalism pants!” In one case the market delivers, in the other it fails.
Another classic example of market failure is US healthcare. Health is a public good and a competitive market is not an efficient solution. The market solution – as exemplified by the US – costs more and delivers less than elsewhere. This topic was covered in a recent NY Times, and I show the graph they used as supporting evidence below.
The points show life expectancy vs. spend for a range of countries over time. The US (in black) is exceptionally bad – it spends far more and yet has been unable to match the rise in life expectancy seen in other countries.
Thank goodness that Beveridge laid the plan and Atlee’s government delivered the NHS. We should cherish and fight to the end of time to protect it, our greatest collective asset.