The purpose of this Shady Sellers series to use my advertising degree to share information on the principles that western society is based on, particularly in America where individuals often have fewer protections against industry than in our European counterparts. Partnering to share information about sellers is a market balancing mechanism called atomism and it’s built into our social system. Based on my formal education, it is my belief that this is the best, most effective way to empower consumers to force fair treatment from companies that cause us harm due to a faulty conscience.

BUYERS AND SELLERS – WESTERN SOCIETY OVERVIEW

Originally published as MAN OR MACHINE – OVERVIEW from the Homestead Protection Blog.

With this thread, I will show that history has borne out that the market is so tightly intertwined with society that it exists to provide for Man’s quality of life, hence: The market must serve man or else American society can no longer call itself free.

Those in academic circles would agree that UT Austin has an excellent Advertising School. When I was there, the creative track was #1 and the media track was the only one of it’s kind in the country. The professor that taught my Advertising in Society class left UT to run the program at the University of Michigan which has long been considered the overall #1 advertising school in the country, so I’m pretty confident that this information is good. If you’d like to verify the accuracy of the information in this post, please see the end notes.

The goal of “Advertising in Society”, was to explore the advertising industry as an institution and its function in a capitalist society.  The history that we studied began with the creation of the western social system, the market system.  There are only three systems on which society can be built; The Market, Tradition, and Authoritarianism.  In America, we wisely chose the Free Market System which was born out of the oppression of the Middle Ages (a tradition based society) and is the social foundation for freedom and democracy as we know it.  In order for the Market system to work “naturally”, the original assumptions that dictate its inner workings must be maintained.  One of these assumptions is that adequate and accurate information will be available.  Without information, the market cannot be balanced or fair and therefore cannot be a suitable foundation on which to build a harmonious, efficient, and prosperous society.  The ad industry is charged with the duty of providing “adequate and accurate” information to the market because government allowed the business world to decide how they would go about this and they chose advertising. This means that Advertising is a social institution which exists as the primary mechanism for maintaining balance in the market (In contrast, an authoritarian government would use rules and laws primarily.)  Socially speaking, whether market information is provided via advertising, direct mail or a singing telegram it doesn’t really matter, so long as the consumer is sufficiently informed.  If homeowners are deceived in conjunction with their efforts to cure a mortgage default, on a large scale, then our society which is based on the free market has become diseased and freedom as we know it is under attack.

By design, the free market should regulate itself, but in practice it does not.  The proponents of free enterprise and lax government regulation tout the system as being “self-righting” or self-balancing as theorized by the framers of the system.  As we’ll see, in the present day market environment, the only thing that can provide this self-righting quality in a “natural” form is corporate conscience which has been found lacking in our modern day society.  In the absence of corporate conscience, the only solution is regulation through administrative or common law.  The Federal Trade Commission (FTC) is an administrative agency created in 1914 to compensate for the failure of the natural balancing mechanism and ultimately restore balance to the market.  It does this by regulating deceptiveness that originates with sellers of products and services.  This deceptiveness hurts not only consumers but other businesses as well (in fact the FTC was originally created to protect businesses from other businesses).  Around the 1970’s many states implemented their own version of the FTC in common law which is known as Deceptive Trade Practices Act (DTPA) legislation.

Consumer Culture and the Market System

Today we use the terms “Liberal” and “Capitalist” to describe members of enemy camps.  But, liberalism and capitalism were born together out of the same desire for freedom.

Industrial capitalism is a system of economic organization that arose out of the decaying feudalism of the Middle Ages.  In part it was caused by and in part was the creator of a radically new value and belief system – Liberalism – which rose to dominance in the eighteenth century and literally conquered the world in the nineteenth ¹

Classical liberalism was heavily influenced by the theories of John Locke and came to replace the tradition based social structure of feudalism.  In those days, “liberalism” meant the same thing that “freedom” does today.  By the time the U.S. constitution came to be, these theories were dominant in the west, hence reference to John Locke’s concept of natural rights (life, liberty, and property) in the U.S. Bill of Rights in 1776 and spoken in 1886 by Abraham Lincoln as part of the Gettysburg address (life, liberty, and the pursuit of happiness).  

It was Locke’s view that man originally lived in a state of nature possessing certain natural rights – life, liberty, and property – all of which were sacred and inalienable by the very construction of the natural order.  In creating governments man surrenders certain rights he possessed in the free state of nature but he does not, because he cannot, surrender his natural rights. ²       

At the end of the Middle Ages, capitalistic forms of economic life began to replace feudalism as a result of the new ideas of liberalism. 

…the ideas that were of fundamental importance in justifying the new economic order were the notions that all was mechanistic, that natural law governed the physical and social world, that the world was characterized by fundamental harmony, that man possessed reason and conscience, that men were born equal and endowed with certain fundamental rights – life, liberty, and property. ³     

These ideas and advancements mark the transition from the Middle Ages to the age of enlightenment.  This new economic order setup in the new age is known as economic liberalism.

Hence, the battle cry of economic liberalism became laissez faire – let the market alone – for if the market were allowed to obey the laws of its own motion it would, in the long run, produce a higher degree of efficiency and prosperity than it could if hamstrung by the regulation of government ⁴

Caveat Emptor:

Locke’s concept of the “tabula rasa” which held that all humans were equal and the human brain was a blank slate at birth.  Accordingly, all men are equally worthy and capable of participating in and benefiting from the market as intellectual beings.  In theory, the consumer was capable of navigating the market in the absence of government regulation, because of Man’s universal ability to reason.  This idea was expressed in the market as “Caveat Emptor”.  Notice, however, that according to classical liberalism and the free market theory, in order for the system to work in the real world, there has to be adequate and accurate market information upon which people can base their decisions.

Caveat Emptor – let the buyer beware – simply means that every individual, being rational, is assumed to possess the ability to exercise correct judgment by basing his decisions on available market information ⁵

The history behind Caveat Emptor is evidence that the capitalist system was, even at its birth, concerned with fairness and egalitarianism.  Another similar notion that found its way into the foundation of our society is the harmonious order of the World Machine conceived by Isaac Newton.  The Newtonian World Machine concept was used by Locke to define the natural order of society (described above) that influenced the emergence of the capitalist system out of the decay of the middle Ages.

The idea of mechanistic systems, of harmonious order in the universe, of natural laws governing the activity of phenomena, of the atomistic conception of matter, of the ability of Reason to apprehend reality – these ideas infected the economic, political, and social thought of generations.  And nowhere did they find more eloquent expression than in the ideas of John Locke, a friend and contemporary of Newton, who translated the discoveries of the physical science into the basis for a social physics, into the basic world outlook for the period ⁶

SUMMARY:

The ideas that brought about the new economic order that would become capitalism were about the nature of Man; who we are in relation to the universe we live in:

1. Natural law governs the physical and social world
2. The world is characterized by fundamental harmony
3. Man possesses reason and conscience the precept to “Man is Rational” given access to adequate and accurate market information.
4. Men were born equal and endowed with certain fundamental, inalienable rights – life, liberty, and property

As a free society, it’s our right to demand remedy through accountability when our rights are being trampled and 600 years of market history shows that if we don’t demand accountability the strong will oppress the weak.  Due to the condition known as “market power” the seller will oppress the buyer. 

Endnotes:

The sources cited in this post came from articles that were reprinted in our class textbook for Advertising 371J “Advertising in Society”.  The textbook is: Roxanne Hovland and Gary B. Wilcox, “Advertising in Society, Classic and Contemporary Readings on Advertising’s Role in Society” (Chicago: NTC Publishing Group, 1989)

1. James W. Carey, “Advertising: An Institutional Approach,” in The Role of Advertising, eds. C.H. Sandage and V. Freyburger (Homewood, Ill.: Richard D. Irwin, 1960).  Copied from Hovland and Wlicox pg. 13
2. James W. Carey, “Advertising: An Institutional Approach,” in The Role of Advertising, eds. C.H. Sandage and V. Freyburger (Homewood, Ill.: Richard D. Irwin, 1960).  Copied from Hovland and Wlicox pg. 17
3. James W. Carey, “Advertising: An Institutional Approach,” in The Role of Advertising, eds. C.H. Sandage and V. Freyburger (Homewood, Ill.: Richard D. Irwin, 1960).  Copied from Hovland and Wlicox pg. 18
4. James W. Carey, “Advertising: An Institutional Approach,” in The Role of Advertising, eds. C.H. Sandage and V. Freyburger (Homewood, Ill.: Richard D. Irwin, 1960).  Copied from Hovland and Wlicox pg. 19
5. James W. Carey, “Advertising: An Institutional Approach,” in The Role of Advertising, eds. C.H. Sandage and V. Freyburger (Homewood, Ill.: Richard D. Irwin, 1960).  Copied from Hovland and Wlicox pg. 21
6. James W. Carey, “Advertising: An Institutional Approach,” in The Role of Advertising, eds. C.H. Sandage and V. Freyburger (Homewood, Ill.: Richard D. Irwin, 1960).  Copied from Hovland and Wlicox pg. 16 (The bold formatting was not in the Carey article and was added by me)