While democratic government is potentially good at protecting the many from the few, it is not good at protecting the many from themselves or from many others within society. As pointed out in chapter 17, government regulation can often prevent trade among willing beneficiaries when such trade will be harmful to others. But there is a serious problem in which majority rule democracy and free markets have a common failing.

Where there is insufficient demand for private enterprise to produce a Good or Service profitably, a "benefactor" of some sort -a third party with the means to pay for a product or labor for another person- is necessary to create the demand to supply it or provide the funds for its supply. Wealthy patrons, charities and foundations are usually thought of as such benefactors. Government is often such a benefactor in that taxes pay for programs for individuals who could not otherwise afford them. Insurance companies are another kind of benefactor in that they pool resources of individuals who may not need the service (at any given time) in order to provide it for those who do. Essentially they are pooling the inadequate (demand) resources of many in order to provide adequate (demand) resources for a few. Thus hospitals, automobile body shops, and other sorts of enterprises insurance claim payments tend to be spent with, can arise and prosper. Insurance does not work for products and labor that each person who pays a premium would want to use; it is a form of lottery that only is useful when a relatively small portion of those who pay actually need the product or labor they are paying for.

Unfortunately there are many important things that not everyone knows they need or would benefit from and would want if they had that knowledge. Education in various subjects or techniques is often one such area where this happens, because people often do not know enough to realize they would benefit from some particular field of study. But research into disease, particularly diseases that do not effect, or are not likely to effect, large numbers of the population (at any one time), is another field for which there is often not a sufficiently high threshold of demand to cause a supply to arise. Individuals are not even likely to be concerned enough about aging to voluntarily fund research on the process, though aging potentially affects most people (those who do not die young from injury, homicide, or disease), ultimately in ways that prove debilitating and/or fatal. The "arts" (meaning the "higher"⁽¹⁾ arts normally - those for which an appreciation normally has to be cultivated) are another area not in popular demand. Environmental protection and public health are other areas of things which are important but which people don't tend to be concerned enough to purchase as individuals. Deeply analytic news coverage is perhaps another potential Service not in high demand.

But whatever the Good or Service at issue is, democratic government (by majority rule) tends to reinforce the rulings of the market place because the very people who are not willing private consumers will normally see no reason to vote public funds for the same things in which they see no private value. And although a government representative might be willing to spend the public's money on something which will personally benefit him or her that s/he would not pay for out of his or her own pocket (e.g., junkets), the sorts of things I am talking about are not likely to be perceived to be of personal value to legislators any more than they are perceived that way by the general public. The only ameliorating influence is that in some cases legislatures can be educated sufficiently to vote paternalistically on behalf of their constituents against those constituents' wishes, but that is a difficult and risky way to conduct oneself in office.

As markets encompass more and more people, all potential consumers, to which advertising and distribution of products and labor become accessible and affordable, some of the above problem disappears. Mail order selling and its contemporary counterpart, Internet selling, for example can find sufficient demand --a sufficient customer base-- widely scattered throughout the world that no brick and mortar store, which has to rely on customers' living within reach, could begin to expect.

Still, the problem of desirable but undesired products and labor for which there is not a market, even globally, is one for which neither markets nor majority rule democracy have a built-in systematic solution. And the very nature that they have in common -the necessity of critical mass appeal- in fact makes this be a problem for free market economies in majority rule democracies.

1. The "arts" are considered by many to be "elitist". There are two ways in which the arts might be considered elitist, and unfortunately, one of those ways tends to cast the other, more important way, in a bad light. The ignoble way in which art is elitist is when it is the province of the rich who pay outrageous prices, often for outrageous things that have no real artistic merit, but which have some sort of snob appeal or false glamour pretentiously attached to them. There is enough of this sort of thing that it gives the impression the arts are only for pretentious people who have no real artistic interests or understanding, and who have more money than sense. But art is "elitist" in a different sense -- one that is not ignoble, and that has to do only with rarity of attainment, such as might be said of the same in sports in regard to the best performers being part of an elite group of athletes, or as one might speak of an elite group of scientists -- those with great knowledge in some esoteric and complex field. In other words, though the understanding and appreciation of the arts may be open to all, as long as only a few choose to study them sufficiently to gain it, they are, strictly by being a small percentage of the population, an elite group. Those who argue for making meaningful art and art education available to more people are actually arguing that art does not need to be, and should not be, elite in either sense, and that it is unfortunate that it is.  (Return to text.)