How existentialism can shield us from the free market's dark side

The smell of cinnamon wafts through the air. My guard is down; resistance is futile. Like a zombie, I roll my luggage across the airport food court and stand in line to pay too much for what I don’t even want, a diet-killing Cinnabon.

I have been phished, at least that’s how two Nobel laureates would describe my experience in their new book Phishing for Phools and in their article The Dark Side of Free Markets. That is, a company has manipulated my weak will to get me to buy something sweet.

George A Akerlof and Robert J Shiller are concerned about the unrealistic depiction of the rational consumer found in economics textbooks and classrooms. This may indeed be a problem for the study and practice of economics. But it is not a problem for the average person, for whom the discovery that there is manipulation and deception in the marketplace is on par with Captain Renault being “shocked, shocked to find that gambling is going on” in Casablanca.

What is to be done? Akerlof and Shiller paternalistically praise “a whole raft of individual heroes, social agencies and government regulation [that] puts limits on this downside of markets to phish us for phools.”

In my new book The Free Market Existentialist: Capitalism without Consumerism, I put responsibility back on the individual, who is smarter and more capable than Akerlof and Shiller recognize. As an average individual, I realize that I am not fully rational and that my will is weak. Beyond that, I know that the marketplace is lousy with hucksters and scam artists looking to take advantage of my irrationality and weakness.

But I can’t expect – or rely on – the government to protect me from myself and my nature. It’s up to each of us to recognize the attempted manipulation and make smart choices.

While free markets do have a dark side, it’s more helpful to consider this through the eyes of individual consumers, not the government and its role as regulator. We are better equipped to do something about it, and existentialism can be our guide and shield.

Sartre, socialism and the Cinnabon

Manipulation and deception in selling baked goods can’t make me do anything that I don’t want to do. All it can do is create the situation in which I regrettably, but freely, change priorities, ignoring the long-term goal of losing weight in favor of satisfying the short-term goal of experiencing the sugar high of a Cinnabon.

As the existentialist Jean-Paul Sartre says, “there is freedom only in a situation” and “there is no situation in which [a person] would be more free than in others.”

Existentialism is a philosophy that reacts to an apparently absurd or meaningless world by urging the individual to overcome alienation, oppression and despair through freedom and self-creation in order to become a genuine person. Curiously, Sartre and most of the French existentialists were socialists.

In my book, I argue that there are sociological reasons for this – just as there are sociological reasons why they smoked stinky cigarettes and drank red wine – but there are no logically necessary reasons. (One need not be a socialist to be an existentialist.)

Freedom and responsibility

Indeed, to be an existentialist is first and foremost to recognize one’s own freedom and responsibility.

Existentialism calls for us to define ourselves as individuals and to resist being defined by external forces. Thus, the self-defining existentialist may find consumer culture crass without necessarily rejecting the free market that makes it possible.

Fear of free markets is just fear that people can’t be trusted to think and act for themselves. Dealing with consumer culture may be difficult, but it is just the kind of challenge the free market existentialist relishes for the opportunity to exercise responsibility and to grow through challenge. Indeed, capitalism provides a large array of choices and opportunities conducive to self-definition.

Because consumer culture may be in tension with one’s ideals and long-term goals, it is up to the individual to recognize this and take control of her own desires and spending. Don’t buy a Hershey bar as you pass through the candy gauntlet at the supermarket checkout. Tear up that credit card application you received in the mail. If you can’t afford something, don’t buy it. Resist consumerism.

What drives consumer culture

Consumerism is ugly. It is the drive and desire for the newest and latest goods and services for the sake of deriving self-worth and signaling one’s worth to others. Shopping and showing off can be intoxicating, but each of us needs to monitor our own consumption and be mindful of whether we are consuming or being consumed.

One way to counteract consumerism is by practicing voluntary simplicity. Rather than indulge in consumption for the sake of keeping up with the Joneses, we can simplify our preferences and possessions.

I offer myself as a highly imperfect example. I have the cheapest possible cellphone and I keep it in the glove compartment of my car for use only in case of emergency. And I drive a simple, plain car, nothing fancy. My clothes are basic, not chosen to impress.

These are my authentic choices. It’s hard for me to imagine, but someone else might authentically choose to wear a Brooks Brothers suit while talking on an iPhone and driving a BMW. In any event, voluntary simplicity is not mandatory.

Free market mantra: buyer beware

The fact that ordinary deception occurs in the marketplace is unfortunate, but in a free society there is nothing to be done except to become aware of it as a general occurrence and to be on the look out for it in specific cases. Caveat emptor, let the buyer beware.

Because of the dissemination of personal information, big companies know more about me than I know about them. Retail stores precision target me with individualized ads, and Facebook eerily entices me to buy the book I was just looking at on Amazon.

For the moment this is unnerving, but with the passage of time, in my view, it will seem as routine as the salesman’s pitch to get the rust-proofing on the new car. Government intervention would be unnecessary and intrusive. Ordinary deception seems to be becoming more difficult to pull off thanks to the proliferation of information available for free on the internet. Scams and manipulation are regularly reported and categorized.

We need the government to protect us from fraud, because fraud is tantamount to theft, but we do not need the government to regulate the free market. Of course there is a fine line between deception and fraud, but we should have good reason for classifying an act as fraud before allowing government involvement.

In a free society, regulation can come without force in the form of private citizens like Akerlof and Shiller anticipating and documenting the phishing that occurs in the marketplace.

Information, self-knowledge and self-definition will not always save us from being phooled, but they will preserve dignity, freedom and choice.

William Irwin does not work for, consult, own shares in or receive funding from any company or organization that would benefit from this article, and has disclosed no relevant affiliations beyond the academic appointment above.