Economics and Talk Radio
by Chris Claypoole
igli1969@comcast.net

Special to The Libertarian Enterprise

It is an axiom in economics that knowledge is disseminated among many, and that no one person, or small group of people, can have sufficient knowledge in real time that is superior to the unfettered free market. This is why collective farms, industries, and the like fail; it is why socialism (the control of the means of production by the state) cannot function effectively or efficiently. The many decisions made by millions (or even thousands) of individuals every day will guide the allocation of resources far more effectively and efficiently than any conceivable set of bureaucrats, even if they are benign (a risky supposition) and backed with the latest computers and information-gathering technology.

So how does this relate to talk radio? Well, I used to listen sporadically to Rush Limbaugh in the 1990s (the first several minutes of each hour then were usually his take on the news of the day, without the bombast and polemics that usually followed). He seldom had guests (I doubt if that has changed), as the show was supposed to be about his take on everything. He also fancied himself an expert on a range of topics, and often, so it seemed to me, offered his opinions as incontrovertible facts.

As a contrast, a local Baltimore radio station, WBAL, has a host named Ron Smith that takes the opposite tack. Ron is very well read (IMO, far more knowledgeable than Limbaugh) on a wide range of subjects. He has guests on every day; some are regulars (from both sides of the old political spectrum), some are topical. But he makes a point of regularly mentioning that one of the great things about talk radio is that whenever the conversation comes across a situation for which specific knowledge is needed, some listener invariably calls in to offer that needed fact or background. Often, more than one, with increasing detail. He makes no pretense of being "the all-knowing" as, ahem, some other does.

(Point of information: Ron is a paleo-conservative with occasional libertarian opinions. He has been against the war in Iraq from the start, and is a minarchist, but also believes in stronger restrictions on immigration. He bills himself as the "Voice of Reason," and I would agree with that, since he tries to bring logic to his arguments, eschewing the use of ad hominems and the like. His show is on 3-6 PM Eastern if you want to listen on streaming audio from the Web site above.)

The contrast is between the host that believes in a top-down, command-economy approach, and one that understands that knowledge is not concentrated, but rather dispersed, and allows the holders of needed pieces of that knowledge the opportunity to contribute that to a wider audience in context. The first approach is that of "the anointed" (per Thomas Sowell's The Vision of the Anointed: Self-Congratulation As a Basis for Social Policy); those who believe themselves to be smarter, more educated, on a higher moral plane, etc., than the rest of us, and so should be able to tell us how to live our lives. Although Sowell mainly skewers the anointed of the left, his characterization applies just as easily to the pompous twits of the right (Bill Bennett comes to mind, as do all the neo-cons).

Ron Smith, OTOH, acts more as an information broker, bringing together guests and callers under his light-handed supervision to compare and contrast information. Everyone gets to learn. Even those callers (and sometimes guests) that I consider bumptious fools are allowed their say as long as they follow the rules, which are basically: Behave yourself, take turns and be polite. This is the free market! No one is saying, "This is the way you should believe, because I said so." Sometimes a point is made (usually by Ron) so logically that the various parties agree on its validity. Bingo! The market of ideas at work! Just like a contract, all parties must agree, and all parties will gain from it.

In a command economy, a central authority will dictate how resources are allocated. In a free market, the participants, both buyers and sellers, make agreements multiple times per day as to how resources are bought and sold. Micromanagement is best done in a micro, that is dispersed, way. When one person (or a small group) tries that, the problems of gathering, processing and disseminating information multiply until the system clogs up: econosclerosis. Without the free flow of economic information among all the players, which is what socialism is all about, the economy won't work. Look at the research correlating the strength of property rights to economic well-being (for example). When government butts out and lets people keep more of the wealth they create, everyone does better, except, I guess, for the official thieves that may not be able to steal as much as they want.

In the example of talk radio, I have no doubt that I learn far more from Ron Smith's shows than I ever did when I used to listen to Limbaugh (which, I admit, I have not done for 3-4 years; he just got too annoying, more full of himself than full of information). By the same token, people in general can accumulate more wealth in a free market than in a socialist, command economy. Unfortunately for us, there are many people that prefer to be told what to think and what to do. Which explains the continuing and (to me) inexplicable popularity of Rush Limbaugh and socialism. I prefer Ron Smith and freedom.

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