There are a lot of people who distrust markets, and who are pretty quick to invoke the concept of market failure. While I typically trust markets more than politicians, there are times when I do think markets fail. I'm not thinking the energy business because the biggest market failures I see are in the press and movie business.
Newspapers and network newscasts are shedding customers at a rate that a straight line extrapolation will put them out of business sooner rather than later. Their main asset, credibility, is eroding just as quickly. Bernard Goldberg was only partly right with his book "Bias" -- as "Lousy" would have been a better description. The bias has become so bad mainly because the whole system is rotten. Rather than listen to the market, i.e their customers, the press is in full defense mode and consumers continue to leave. The message from the press has become the only thing wrong with the news media is that people are stupid, don't like being told the truth, and just don't appreciate the news. My local paper, the St. Louis Post Dispatch, is somewhere between awful and terrible - with a few notable exceptions. They got rid of their ombudsman a few years ago, someone I came to respect, and now you have to contact people direct with any problems. And that's when you run into just how smug and arrogant journalists have become. We only get the paper for the coupons anymore - the overall news value is less than zero. But they were bought out by another chain and the look "updated" -- while my older eyes appreciate the increase in readability and whitespace (which I wonder is just a way to cut down on content), the rest of the changes are generally poor and seem to be driven not by usability but some designers color palate - where the colors used to provide information (like on the weather page or in the financial section) now they are just accents with no information content. Two aphorisms come to mind - they just put lipstick on a pig, and you can't polish a turd. But hey, why do the hard work of putting out a quality newspaper when you can do a redesign of the look instead. Fox News is killing the opposition because they put out a better (which doesn't necessarily mean good) product.
And the movie business seems to be run not based on making money but on making films some good leftists think you ought to see and making films that only teenagers would watch to pay the bills. I like movies. I like going to movie theaters, I like renting them, I like buying really good ones because just owning a great movie makes me feel all warm and tingly inside. I am denied these simple pleasures because Hollywood insists on making crap unfit for human consumption. The hottest properties in Hollywood are either extensions of old work like LOTR and Star Wars or comic books. Comic Books! I happen to enjoy comic books, and still own quite a few (make me an offer and they can be yours) but I don't want a steady diet of comic book based movies. I want epics, I want small movies, I want family movies, I want grown up movies, I want movies with intellegent dialogue, and I would really like to see comedies that don't insult you. Is that really too much to ask for? Why did a movie like My Big Fat Greek Wedding have such difficulty in being made? Why are there so few movies like Sideways -- aimed at the above 35 crowd? Why, after the huge success of The Passion of the Christ were there no copycats. C'mon, copycatting successful movies has been a staple of Hollywood since D.W Griffith. Here's a movie that made like $400 million dollars and brought people to the theater who hadn't been in years, and what's the followup? Kingdom of Heaven. That thud was the sound of a turd hitting the screen, and by a great director too. How could they have botched Troy and Alexander so badly when the source material was so good? If you can make Les Miserables into a musical, how can you fail at making the Illiad into an epic?
Heres a case where there is a market clamoring for one thing, but suppliers not providing it, and leaving money on the table doing so. That to me is one huge market failure.
