Free Markets: Follow the Fracking Model
Rich Tucker /
Photo Credit: Face to Face Photography
If you’ve been to the movies lately, you’ve probably seen ads for Promised Land, a film that takes a dim view of using hydraulic fracturing (fracking) to produce natural gas. Steve Forbes isn’t surprised.
“In movies, capitalists kill more people than serial killers,” he said during an appearance at The Heritage Foundation to promote his new book, The Freedom Manifesto: Why Free Markets Are Moral and Big Government Isn’t. But the reality is far different from the Hollywood fantasy.
>>> Watch our interview with Steve Forbes about free markets
The real story, as Forbes says, is that free markets improve lives. They help allocate scarce resources and allow people to create value. He cites fracking as a perfect example.
An entrepreneur named George Mitchell realized there was natural gas locked in shale formations in Texas. He worked for years to develop a cost-effective way to release that fuel. His innovation has sparked a boom in American jobs while drastically reducing the cost of fuel.
Government intervention, meanwhile, tends to slow down innovation and prevent growth. For example, natural gas remains five times more expensive in Europe than in the U.S., because European governments won’t allow fracking, Forbes notes.
And what are government’s big ideas, Forbes asks? Railroads (a 19th century innovation) and windmills (a medieval technology). In a way, that makes sense. Bureaucrats inevitably look to the past for solutions to problems, while free markets and capitalism encourage people to create new products and services—everything from computer chips to one-size-fits-all lids for coffee cups.
If our country wants to help the poor, Forbes says, it should emphasize free-market capitalism. “Government creates scarcity,” he says. On the other hand, when people want more of something, entrepreneurs find ways to deliver more of it. As the subhead of his book explains, that’s “why free markets are moral and big government isn’t.”