Why Libertarianism Doesn't Work

An interesting post from Nobel Prize-winning economist Paul Krugman's blog:

Thinking about BP and the Gulf: in this old interview, Milton Friedman says that there’s no need for product safety regulation, because corporations know that if they do harm they’ll be sued.

Interviewer: So tort law takes care of a lot of this ..
Friedman: Absolutely, absolutely.

Meanwhile, in the real world:

In the wake of last month’s catastrophic Gulf Coast oil spill, Sen. Lisa Murkowski blocked a bill that would have raised the maximum liability for oil companies after a spill from a paltry $75 million to $10 billion. The Republican lawmaker said the bill, introduced by Sen. Robert Menendez (D-NJ), would have unfairly hurt smaller oil companies by raising the costs of oil production. The legislation is “not where we need to be right now” she said.

And don’t say that we just need better politicians. If libertarianism requires incorruptible politicians to work, it’s not serious.

I must say that I like the comment from Lisa Hirsch (#12), too:

I'm sure some true believer will be along to tell us all about how this should work or would work in the ideal world. I will believe that true believer to the exact extent I believe my friends who say Marxism would work if we ever had REAL Marxism. The polite description of these people is naively idealistic religious believers.

I'd say that is spot on, about Marxists and libertarians both.