I find Steve Horwitz’s claim that “Markets, including Wal-Mart, have done more for poor Americans than any government program, at least in the long run if not the short run” to be a bit puzzling. If this means that the absence of governance à la Joseph Stalin is a more important determinant of our well-being than is, say, the existence of unemployment insurance then, yes, of course this is true. But the question facing government programs is not whether they are more or less beneficial than the existence of a market economy, the question is whether the programs are more beneficial than would be the absence of programs.
And of course the answer, to me, comes up differently according to the program. And this is where things get tricky. Horwitz cites minimum wage laws and occupational licensure requirements as examples of non-beneficial programs. I’m not sold either way on the minimum wage, but definitely agree about the licensing. At the same time, things like rules that prevent dental hygienists from practicing without being supervised by a dentist aren’t being perpetrated by “the left,” they’re being perpetrated by dentists. It’s a classic example of concentrated benefits and diffuse costs. And the question, to my mind, is what is to be done about it. If it were the case that electing politicians who are given to waxing effusive about the virtues of free markets (i.e., Republicans) was likely to mitigate such abuses, I would look more kindly on such politicians. But in practice, it doesn’t seem to make much of a difference.
And then there’s a different set of regulatory issues, notably those dealing with the environment, where the benefits of regulation are diffuse and the costs are concentrated on the polluting firms. Here I side against the free marketers, but this is where market rhetoric seems to have a lot of efficacy. Which isn’t to point to a flaw in market rhetoric per se, but merely to the reality that any set of rhetorical strategies is more likely to succeed when it has a lot of money and political influence behind it. But if you want to convince people on the left that an alliance is worthwhile, you need to make the case not merely that market principles could in theory help the poor by dismantling some barriers to economic opportunity, but find some concrete projects on which to collaborate. Otherwise, market and anti-regulatory rhetoric will continue to be associated with what it accomplishes in practice—serve the ends of politically powerful entities when it’s convenient to them.