The problems associated with Toyota’s faulty brakes are by now widely known. Many on the left and in government will use this as an opportunity to expand government power while blaming the free market for yet another failure.
But, as this column from the free market think tank, The Independent Institute points out, people (and businesses) are not perfect. Toyota clearly screwed up here and the market (average customers reacting to information) is punishing them. The loss of millions of dollars in sales, not to mention the harm this issue has done to the company’s public image, will serve as an incentive to Toyota not to cut corners next time and a reminder to other businesses — automotive and otherwise — to make sure that their products are ready for “prime time” before they are sold to the public.
In other words, the market is responding quickly to make sure this doesn’t happen again or happens less often in the future. As we see in the field of education, the same cannot be said for government.
The free market never fails. It’s always provides the greatest good for the greatest number at the lowest price. When someone makes a mistake it punishes that person. What happens when a government monopoly does a bad job? Public schools keep right on doing a bad job. Any questions?
In other words, the people who have died or had their lives ruined don’t matter. Because the market corrected itself afterward!
And all those people who spent large chunks of their salary on faulty vehicles? Who cares!
No, that’s not it at all. The fact is that no person or institution is perfect and automobiles are inherently dangerous. The best we can hope for is to use the market to provide incentives for this not to happen again.