Actually, The Free Market Benefits The Environment

Free Market capitalism

With the recent announcement regarding the United States’ withdrawal from the Paris climate agreement, progressive environmental advocates, with the help of many mainstream news outlets, have found themselves engulfed in hysteria that this may be the beginning of the end for planet Earth.

Fortunately, for those of you looking for an honest, level-headed solution to this, you needn’t worry. As always, we can look to the free market and rest assured that, yes, the free market provides for the environment too.

Unfortunately, however, the market’s defining feature comes as a double-edged sword, providing both the incentive to help the environment, and inviting its criticisms. This characteristic being that the market delivers what consumers want; nothing more, nothing less.

Many environmentalists like to point out that “The unregulated market allowed corporations to pollute in the first place!” and in that regard, they would be right. As I said, the market provides what the consumer wants, and as was the case before the Industrial Revolution, consumers wanted to escape their subsistent standard of living above all else – even at the expense of the environment. As such, the market gave the incentive for producers to neglect the environment in pursuit of raising the standard of living. Luckily though, it did not come at the complete detriment of the environment.

Mainly because, when combined with property rights, a free market naturally provides a sustainable milieu for the environment. As property owners use land, water, and other segments of the environment to build and create in the pursuit of their self-interest, they also have a vested interest in maintaining their property if they hope to sustain their profits. For example, in the case of loggers, they must not only replant trees as they cut their forest, but also plan out a sustainable number of trees to cut each year, price them accordingly, and search for alternative, environmentally-sustainable uses in order to stay in business. Unlike in the Amazon, where we see public ownership of the forest and loggers rushing to cut as much as possible, lest another company beat them to it, taking profits with them. The tragedy of the commons, as it is often referred to, is not a flaw in the market, but a shortfall of government planning.

Unsurprisingly, the market delivered on its promise of raising the standards of living, so much in fact that the number of people living in poverty globally is at its lowest level in human history. Had this been the product of a state-sponsored program, we would hear it proclaimed on every news station and taught in every school ad nauseam. Yet, it goes unnoticed under the current cries for environmental socialism. Never mind that this progress is the very reason we have the economic freedom and wherewithal to even notice and complain about our environmental impact at all.

Not to worry, though, for when it comes to remedying our impact on the environment, the free market will once again shoulder the task. Now that climate change has become a hot topic, the incentives have shifted, urging producers to innovate greener technology in pursuit of hedging their market share of environmentally-friendly consumers. Places like McDonald’s attempt to prove that their business model promotes sustainability, in hopes of attracting supportive customers, while internet startups like Ecosia commit 80% of their profits to go towards planting trees, precisely because it’s what people say they want. We have reached a point where our standard of living and abundance of resources allows those in the US and other first-world nations to pick and choose which businesses survive in the market based more and more on their environmental impact.

Meanwhile, those same first-world nations who benefitted from the market’s success are naively advocating to terminate its most beneficial qualities around the world. Cutting off that cycle of progress for third-world nations will not only be environmentally harmful, where reliance on inefficient farming methods is causing devastating soil erosion, among other things, but they will also never be able to escape the subsistent standards they live in, being held to a perpetual state of abject poverty.

Ironically, the behavior of the environment is a mirror image of the free market. When left undisturbed, both have ways of working out problems inherent in them, both eventually come to rest at a natural equilibrium, and they both provide the groundwork for human prosperity. It’s a shame progressives don’t advocate for the market to be left unperturbed as zealously as they do the environment.

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Thomas J. Eckert

Thomas J. Eckert is the Managing Editor of Think Liberty and Copy Editor for Being Libertarian. With a passion for politics, he studies economics and history and writes in his spare time on political and economic current events. He is a self-described voluntarist.


  1. The entire argument your article is presenting hinges on the (rather weak, in my opinion) examples of McDonalds, whose sustainability campaign I suspect is managed by their PR department, and Ecosia, who nobody has heard of. If market forces are influencing the environmental debate, it’s being very weak about it. And unfortunately if the scientific community is to be believed, we cannot have a weak force promoting environmentalism.

    I have been trying to reconcile a practical approach to a union of libertarianism and environmentalism for years, and despite having read many articles like this, my position remains unchanged: a government must still regulate the environment. There are, in my opinion, good ways to balance this with personal liberty, so long as businesses are not identified as persons.

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