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Business-Managed Democracy

“Business-managed democracies are those in which the political and cultural arrangements are managed in the interests of business”

Sharon Beder

Business-Managed Environment

Promoting the Market

‘free market’ at a time when environmentalism most threatens it. For example, publications from the British Institute of economic Affairs have argued:


the pursuit of profit in a capitalist economy leads to a husbanding of resources. Mature capitalist economies use less resources to produce the equivalent level of output and hence do less damage to the environment.


According to Heritage Foundation’s policy analyst, John Shanahan, the free market is a conservation mechanism: “By denying ourselves material wealth today, by slowing the accumulation of wealth, we are denying our children. You deny the future by not using resources now.” In 1993 Shanahan wrote to President-elect Clinton urging him to use markets and property rights “where possible to distribute environmental ‘goods’ efficiently and equitably” rather than legislation. He argued that “the longer the list of environmental regulations, the longer the unemployment lines.”


Similarly, John Hood argued in the Heritage Foundation’s magazine Policy Review that “Corporations pursuing profit have as much chance of generating environmental benefits as regulators or environmental activists do—particularly when they are faced with prices for waste disposal that are as close to cost as possible.

Market-based measures grant the highest decision-making power over environmental quality to those who currently make production decisions now. A market system gives power  to those most able to pay. Corporations and firms rather than citizens or environmentalists will have the choice about whether to pollute (and pay the charges or buy credits to do so) or clean up.

Anderson and Leal from the San Francisco-based think tank, the Pacific Research Institute for Public Policy, juxtaposed the market with the political process as a means of allocating environmental resources and argue that the political process is inefficient, that is it doesn’t reach the ‘optimal’ level of pollution, that is the level of pollution where costs are minimised:


If markets produce ‘too little’ clean water because dischargers do not have to pay for its use, then political solutions are equally likely to produce ‘too much’ clean water because those who enjoy the benefits do not pay the cost... Just as pollution externalities can generate too much dirty air, political externalities can generate too much water storage, clear-cutting, wilderness, or water quality.
Free market environmentalism emphasises the importance of market processes in determining optimal amounts of resource use.

‘Too much’ clean water it seems is where the company polluting the water has to pay too much to clean up the mess they make. It involves a judgement that costs to the company are somehow synonymous with costs to the community and therefore can be weighed against benefits to the community.

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