A frustration with many books about Christian economics is their bland
statements about what markets do and do not do. “The market does not
produce enough health care”. “The market does not......" These statements
show that the authors do not really understand the nature of markets.
A market is not a moral entity that can be judged as right or wrong.
A market cannot make decisions or take actions. A market is simply a
place for information sharing. People provide information (including the
price) of things they have for sale. Other people can look at what is
offered and choose to buy if it is what they want and the price is
right. A market can take many forms. At a farmers market, sellers offer
information by displaying what they have for sale. On EBay, people
display photographs and textual information about what they are selling.
Whatever the market, a sale is only completed, if both the buyer and the
seller agree to the price.
There are three groups of moral actors involved in a market. First,
there are the owners of the market. They set the rules under which the
market operates. If their rules allow cheating or coercion, they are
immoral. If people are not forced to sell on their market, then the
price they charge cannot be immoral, because no one has to pay it.
The second group of moral actors are the sellers. They are morally
wrong, if they sell stolen goods, or they lie about the quality of what
they are selling. The third group of moral actors is the purchases. They
are acting immorally if they pay for goods with counterfeit money, or if
they use physical force to someone to sell at cheaper price. However, if
both buyer and seller freely agree on the price, then nothing immoral
has occurred. If someone who wants a good decides the price is too
expensive, this is their privilege. The seller has not done anything
wrong. The market itself is not a moral actor, because it does not act
or make decisions.
Therefore to claim that the market has not done something that it
should is a nonsense statement. Markets cannot do anything. What the
critic is really saying is the people have not done what they believe
they should have done. The statement that the market does not produce
enough health care, is really a statement that people do not purchase
enough health care. The statement that the market does not produce
enough jobs, is really a claim that people (either individually or
acting together in corporations) do no produce enough jobs. The market
does not decide the number of jobs that will be offered. The market
cannot decide the volume of health care that will be purchased. People
decide these things.
The common term for these perceived problems is “market failure”,
but this is a misnomer. Markets cannot fail, because they cannot decide
and they cannot act. What is called market failure is really
"people failure". Those who talk about market failure are
really describing people failure. They are saying they do not like the
outcome of the decisions made by the various people participating freely
in markets. (They are generally not criticising stealing or dishonesty
market participants, which is evil, not failure).
Blaming the markets justifies interesting solutions, because if
markets fail, governments must do something to correct them. A little
thinking exposes the nature of the solution. If the problem is “people
failure”, then the critics of the market are really saying that they
want to force people to make better decisions. For example, the solution
to inadequate health care is to force people to purchase more
healthcare, or to force other people to pay for health care for those
who chose not to buy it for themselves. If people do not produce the
right number of jobs, force them to invest their money in projects that
will produce more jobs.
The advocates of the market failure doctrine do not like the
decisions that people make. They believe that they can make better
decisions on their behalf, so they want to force people to do what they
believe is the right thing. So the market failure doctrine is really
just a clever way of slipping in a process for the wise to force the
unwise to make better decisions.
In a fallen world, people failure will be normal. People will often
make poor decisions. They will sometimes make decisions that other people do
not like. People might not produce everything that other people want.
If I need a silk-lined yak-fibre woven hat, I might not find one. I
have three options. I could go without. I could make one myself. Or I
could try and force someone else to make one for me. The market failure
crowd prefer the last option, because they know best what is best.
They believe that they can eliminate “people failure”, but it
does not occur to them that they could be the people failing.