I don't know where the idea came from that anybody thinks that the free market can solve all the world's problems. Apparently somebody does, because this Slashdot poster felt that he had to deny that it does. I think this is a strawman, however. I don't know anybody who thinks that the free market can solve all the world's problems. I'm quite sure that opponents of free markets think that proponents of free markets think that they can solve all the world's problems.
Some problems are simply hard to solve. There is no magic wand. A free market can't solve them. Neither can a market constrained by the violence of the state -- although it will arrive at a different solution. Constraining markets isn't free of cost, so while it may appear that constrained markets work better, you also have to count the cost of the constraint. Also, the constraint serves to eliminate creativity, so that a free market solution which might arrive over time, will never appear.
Nobody can solve all the world's problems, because as soon as you solve the worst problem, things which weren't perceived as problems before, are now problems.
posted at: 16:57 | path: /economics | permanent link to this entry