Joshua Katz writes:
In your splendid essay on LRC today, I feel a need to ask about a minor quibble which, admittedly, does not rise to the level of a threat to your thesis. In number 8, you make short work of the idea that advertising can brainwash customers – but I’m not sure I can agree with your observation. Yes, companies spend money (much of it subsidized) on market research, but they also spend money on precisely the question of how to create a market for their products. More importantly, the taxpayers spend an inordinate amount of money on the same question. What do I refer to? Consider our vast universities, mostly supported by government money (and by a system of licensing and regulation promoted by – well, you can finish that sentence). They have large departments of psychology, of marketing, and so on. They work hard to apply the insights (luckily, most of them dubious) of the psychology profession to the task of Madison Ave. Scientists spend years studying brain scans and attempting to correlate them to spending behavior.
We can also observe the success of marketing at selling useless goods empirically. Without advertising, do we imagine that our homes would be full of exercise equipment, largely used as storage places for laundry? (I myself didn’t get into shape at all until I joined an intense gym.) Would we stockpile so many kids toys, drink disgustingly colored liquid (made of acid and corn syrup), or think it makes sense to buy real estate no money down? I consider it beyond question as an empirical matter that, in fact, our corporate kleptocrats have learned something from psychology, and actively use it to manipulate us.
More to the point, consider the absolute most destructive use of advertising – the marketing of armed services to teenagers. Without advertising, can you imagine a typical teenager saying, “You know what I really want to do – I want to travel to a hot desert and kill people.” Of course not. Such a result takes instillation of emotions such as patriotism, conviction that this is somehow manly and brave, and so on – all of which are done through propaganda and armed services advertising. We libertarians are quick to point to the use of advertising made by government in their PSAs and army commercials, and to call it an attempt to brainwash the youth. So most of us have already accepted the principle that these sorts of things can be done, and are desired by underhanded people. So why should we doubt that underhanded people who run corporations might try it?
Now, I label this quibble as minor for the following reason. Even after saying this, what follows? Is this somehow a problem for the free market? I say, not at all. This is another point in favor of free markets. Who delivered all this psychological data, useless for any purpose than getting people to conform to desired behavior patterns? Government funded universities. Madison Ave would be useless without government. All of the findings are pushed by government, and the advertising usage is just a side effect. Government is also the most guilty of this sort of behavior.