This was originally written as a column for the Star-Exponent
I believe in the spontaneous order of markets. Left free, markets are in fact not unstable as we are often told, they actually order themselves quite nicely. It is usually only when the force of government is introduced that there are dislocations within an economy and the associated pain for participants.
One of the best places to see this is in the parking lot of a Grateful Dead show.
The Grateful Dead sadly are not the Grateful Dead any longer, but what is left of the band continues on under various names. Regardless, the economic experiment which happens outside of these shows now is essentially the same as what one witnessed years ago.
A Dead show parking lot is the single freest, most capitalistic place I have ever been to in my entire life. Miles beyond Wall Street for instance.
This might sound surprising as deadheads are not known for their love of capitalism. In fact many of the heads I knew in college railed against capitalism. (Though for the most part economics was not really their bailiwick.)
Yet in the parking lot of a show all of the rules society imposes upon commerce are temporarily suspended. Though the police are always present in the background, and everyone knows they are there, there is the assumption that so long as people are peaceful and not starting trouble the cops are unlikely to hassle them. It is a little island of free markets.
There are no drug laws in the parking lot. There are no licensure laws in the parking lot. There is no enforcement of supposed “intellectual property” in the parking lot. There is no zoning for businesses which sell anything from beer to veggie bagels to t-shirts out of the backs of Subaru station wagons. And yet, and I have been to a good number of shows over the years, the whole place orders itself beautifully every time, with no force of law.
Again, if people get out of hand, which happens on occasion, the official authorities are usually swift to address the situation, but the peaceful exchange of goods, services, ideas, and music is almost always tolerated.
The thing that is particularly striking to me is how this massive marketplace pulls itself together more or less spontaneously at every single show. There are certain rules by which everyone more or less agrees, certain norms of behavior which are not codified in any specific set of laws, and people for the most part get along well.
Is the Dead parking lot perfect? By no means. It is for instance no place for children. If one has a moral problem with the ingestion of mind altering substances one should definitely steer clear. Are there lost souls mixed in with the revelry? Without doubt. However the lesson to be learned is that even a large group of people who embrace very alternative world views (at least on occasion) can exist peacefully and in many cases profitably if just left alone.
The Dead parking lot is one of the best examples of the “spontaneous order” Nobel Prize winning economist F.A. Hayek often wrote about, that I have ever witnessed. Markets, left to their own devices organize themselves quickly and efficiently. Other examples of spontaneous order would be the evolution of language and of the Internet.
We would be wise to remember the lessons of spontaneous order as we seek to find our way out of the nastiest recession we have seen since the 1930s. For all of our intervention in the economy since 2008, nothing has worked. In fact there is a very good case to be made that such intervention has made things much worse.
If we would just get out of the way. If we would stop printing money, if we would stop regulating businesses to death, we’d see the economy recover.
But we humans are ego driven creatures. We always want to do something. I say, take a lesson from the deadheads. Chill. Let the economy work itself out. Things will be OK if we just get our hang ups out of the way, man. The world won’t end if we stop fiddling with the markets. There will be some pain initially but as the economy reverts to its natural state we will see abundance unlike anything we’ve seen in a long time in this country.
We’ll be truckin’ before we know it.