‘Market rules should benefit the majority of the citizenry’: historians Naomi Oreskes and Erik M Conway
Lauren Aratani
9 min read
For the last decade, historians Naomi Oreskes and Erik M Conway have been digging into the history of the idea that freedom only thrives if businesses are left unbothered by governments. It’s a philosophy that has touched every corner of American life, they argue, even though it has long been proven deeply flawed.
In their new book – The Big Myth – How American Business Taught Us to Loathe Government and Love the Free Market – Oreskes and Conway document the rise of what’s more politely called “market fundamentalism” over the last century, from corporate propaganda and fringe academic theory to mainstream ideology.
The book is both a sequel and a prequel to their groundbreaking book Merchants of Doubt, which is about a handful of prominent scientists who obfuscated clear scientific findings to oppose climate regulation. At the heart of their beliefs, Oreskes and Conway argue, was the big myth.
The Guardian spoke to Oreskes and Conway about The Big Myth and how it came to dominate how Americans think about government regulation. This interview has been edited for length and clarity.
The Guardian: How do you define “the big myth”?
Oreskes: In a way, the myth isn’t just one thing; it’s a set of interconnected concepts that together support this larger ideology of market fundamentalism.
The first part of the myth is the notion of the free market, the idea that you could even meaningfully talk about “the free market” as a thing that exists. In reality, people make markets. Markets are human institutions.
So that leads to the second part of the myth, which is the idea that markets have wisdom, that the invisible hand guides us and that if we all do our own thing, our own self-interest will somehow lead to this productive, efficient and happy outcome. And therefore, we should just trust markets, that the government distorts markets and interferes with the wisdom of the marketplace.
Then the third part of the myth is, in a way, the most damaging – it’s the piece that really informed Merchants of Doubt. It’s this idea of the inextricable link between capitalism and economic freedom as a bulwark against totalitarianism.
What are the origins of the big myth?
Conway: We pick up the story with business leaders fighting against the regulation of child labor and workplace safety. We’ve all forgotten that there was a crisis of workplace accidents in the United States in the late-19th and early-20th century that killed and maimed hundreds of thousands of people
Business leaders in the United States were absolutely dead-set against doing anything about these twin crises.
Oreskes: It’s pretty hard to come up with a good argument to defend the employment of children as young as two in textile mills, which we know happened. How do you defend something that’s clearly, on the surface, really quite appalling? Come up with some kind of argument that appeals to something that we do care about, that we value: freedom.
We saw this in Merchants of Doubt, when we talked about the tobacco industry and how it mobilized this whole argument about the freedom to smoke, that you don’t want the government telling you what to do. We actually thought the tobacco industry invented that strategy. But they didn’t. What we show in this new book is that it goes back much further.
In the 20th century, one of the things the market fundamentalists did was rewrite US history to invent a story about how free enterprise was embedded into the very foundations of American society, economy and culture.
If you’re hammered through every outlet with the same message over and over again, eventually you start to believe it
They do this in the 1930s through a metaphor they came up with called the “Tripod of Freedom”. This was pushed by the National Association of Manufacturers (NAM), which at the time was the largest trade organization in the United States. They claimed that the United States was founded on three essential principles that were like a tripod – if any were to be compromised, the whole structure would fall. The three pillars were representative democracy, the Bill of Rights and free enterprise. The third part was a complete invention because, actually, free enterprise appears nowhere in the constitution or in the Bill of Rights. Nowhere in the Declaration of Independence.
The book covers the extensive propaganda campaign from NAM and companies like General Electric to sway the American public against government regulation of businesses. Why were these campaigns so effective?
Conway: They disguised propaganda as entertainment, it was not obviously partisan or political. That was the whole idea. Propagandists need a kernel of truth in order to be successful. The best lies are ones that are built on something people already believe.
Cast of the 1974 Little House on the Prairie.Photograph: Photo 12/Alamy
They basically doubled down after the second world war when corporations could control their own advertising again. They keep doing it for decades. If you’re hammered through every outlet with the same message over and over again, eventually you start to believe it. Even if, once upon a time, you realized it was garbage.
You have a whole chapter on Little House on the Prairie, Laura Ingalls Wilder’s best-selling books that became a hit TV show. I imagine many people didn’t know it was largely written with the help of her daughter, Rose Lane Wilder, a staunch libertarian. Though the books are supposed to be about Ingalls Wilder’s true childhood, Lane Wilder fictionalized much of it to expound on the ideals of individualism.
Oreskes: There are people out there who are mad at us for bursting that bubble. My defense? Actually, we didn’t burst the bubble. Other historians, Caroline Fraser and Christine Woodside burst that bubble, and we’re drawing from their work.
In the first chunk of the book, market fundamentalism is fighting an uphill battle. At what point did market fundamentalism start taking hold and becoming mainstream?
Oreskes: A key figure in this story, obviously, is Ronald Reagan. Most Americans know that Reagan was an actor before he became a politician, but what they don’t know is how he affected that transition.
It’s pretty clear that during this period, Reagan’s political outlook shifts to be very, very aligned with GE
Reagan’s career was not doing all that well, but he was still a Democrat. He was the president of the Screen Actors Guild. But then he gets this job with GE, and the job has two parts: hosting General Electric Theater and promoting General Electric ideology through speeches. It’s pretty clear that during this period, his political outlook shifts to be very, very aligned with GE. So he comes out of GE with this new political ideology, quite different than what he had before he went in. Also critically, he comes out with a set of wealthy corporate backers who then finance his run for governor of California.
But you make the point that it wasn’t just Reagan.
Conway: When Jimmy Carter becomes president, he brings into office a new generation of economists, many of whom have now been educated with the ideas of free markets that have been pushed into academia by the Chicago School of Economics. They begin shifting the way the government manages the economy. They are the regulators Carter brings into office, the first people we now associate with Reagan and ending with Bill Clinton, who finishes the job of deregulating banks in the late 1990s.
Orenskes: We see how this language, rhetoric and ideology gets taken across the board politically so that when Bill Cinton gives his State of the Union address in 1995, he says: “The era of big government is over.” And that’s a Democrat, right?
So how does that happen? Milton Friedman said one of the jobs of intellectuals is to be standing ready with ideas. And you just work on your ideas and you get laughed at for a long time. But one day, the world is ready and then you’re there. So when the crisis, the postwar 1970s stagflation develops, nobody really has an explanation for why this has happened. There are probably multiple factors – but the right wing is now standing ready saying: “Oh, the problem is too much government. The problem is big government. The problem is overregulation.” That gains traction, in part because it’s a simpler explanation to a complex problem.
Does it seem like market fundamentalism’s grasp is loosening? Are the tides changing?
Oreskes: After the Silicon Valley Bank failure, there’s this big conversation taking place right now about how much of that was allowed to happen by weakened regulation, particularly because there were specific regulations that were weakened during the Trump administration.
People stand outside an entrance to Silicon Valley Bank in Santa Clara, California, in March 2023.Photograph: Jeff Chiu/AP
I think most people still see regulation as a necessary evil – even liberals and progressives. So they’re sort of apologetic about it. “Yeah, I know it’s bad. But you know, we have to do it.” I would like to try to change that conversation, to make people think much more in terms of regulations as the rules of how markets operate.
At the end of the book, we make a point about biological regulation. Without biological regulation, all life would cease to exist because an organism cannot operate unless it can regulate its internal chemistry. Biological regulation makes life possible. I think that’s true of society as a whole. The right set of rules and regulations supports a vibrant economy where people can “live well and prosper” (you know, Star Trek).
Conway: The question is, who are the rules set up to benefit the most? Business leaders want the rules of the road to benefit them, and we’re arguing that no, the rules of the market should benefit the majority of the citizenry, not just the business leaders.
