The Free Market 14, no. 5 (May 1996)
The 1996 blizzard dumped three feet of snow on the Washington, D.C., area. The event proved once again that statist economists, armed with their “market failure” theories, perceive reality exactly the opposite from the way it is. It is government, not the free market, that is inherently plagued with inefficiency, fraud, and corruption. Private property and competitive markets provide citizens with the superior alternative—not the other way around.
The Washington, D.C., government rose to its greatest level of incompetence following the blizzard. Most residential streets never saw a snowplow despite the fact that their residents pay the highest local taxes of any jurisdiction in America. Much of the D.C. subway was out of service for weeks because stupid government employees forgot to park the trains in underground tunnels created for exactly that purpose, despite several days warning of the storm’s approach.
The federal government also made things worse for snowbound residents by refusing to deliver the mail for as long as a week after the storm, despite the fact that private four-wheel-drive trucks and even regular cars had little problem getting around. In some neighborhoods, the U.S. Postal Service refused to deliver the mail if there was any ice on a sidewalk. And the EPA made life that much more difficult by prohibiting the dumping of any snow into the Potomac River.
In contrast to this carnival of incompetency, there arose a glaring example of the ability of voluntarism and free markets to respond to such a crisis. Even the Washington Post noticed that an “impromptu economy” emerged in the wake of the storm and compensated for many government failures.
For example, dozens of small landscaping businesses, normally dormant in the winter, strapped snowplows onto their pickup trucks and created a large, temporary industry of snow removers to rescue D.C. residents. Farmers from Maryland and Virginia also discovered a profitable wintertime use for their tractors, and hundreds of citizens started new “businesses” by shoveling sidewalks.
The complete paralysis of government—including the shutdown of the federal government—created the fringe benefit of a charitable outburst. Citizens checked on their elderly neighbors, volunteered their four-wheel-drive vehicles for use as taxis for hospitals, and performed myriad other acts of generosity. Americans are especially generous when government gets out of the way.
The Post noted that an “alternative blizzard economy” immediately arose. Residents whose businesses had been disrupted were “on one side” of the market, while “customers willing to pay a premium to obtain a convenience” were on the other side. Miracle of miracles, “simple supply and demand is sparking the entrepreneurial spirit that has created an underground economy” which, according to one quoted professor, is the result of a “spontaneous response to adverse conditions.”
Among other examples of this were a 13-year-old girl who made money by running back and forth to grocery stores for her elderly neighbors; her 14-year-old friend who made $30 in two days digging out cars; and the creation of a full-blown barter economy in a Maryland neighborhood.
As described by one resident, “everyone kept telling me that they couldn’t find any bread at the store, so I baked six loaves. I gave a loaf to my neighbor. In return, he gave me a dozen eggs....” Sounding as though she spent her downtime during the storm reading Human Action, the woman remarked, “there’s an understanding that if you do something for someone else, at some point, the other person is going to help you out.”
Many smaller businesses that have been struggling to compete with larger chains viewed the blizzard as an entrepreneurial opportunity by offering home delivery of pharmaceuticals, groceries, and other items. The hope is that after the storm, customers will “think twice before going to one of the big chains,” according to one merchant.
Cities should scrap the common practice of managing the economy by controlling prices during and after a storm. That only hinders the market from meeting people’s needs, and makes the shortages and dislocations even worse. Cities should also rethink the enormous sums they spend on “emergency” equipment that never does the job it is supposed to do. Far better to let people plan for themselves. It’s better that people in charge of a clean-up see it as a profit opportunity than as a burden.
The blizzard of ‘96 left D.C. and blew its way up the east coast. Let’s hope that the lesson of how the free market works was taught to the residents of Cambridge, Princeton, Providence, and other Ivy League hotbeds of “market failure” theorizing.
