6 Ways The Free Market Is Like An Ecosystem

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By: Susan Bigknife

Ecosystems function best when you leave them alone. I learned this principle while studying permaculture (the science/art of creating backyard food-producing ecosystems). I was amazed at how similar permaculture principles were to free market economics. The spontaneous order that occurs in nature also applies to the economic activities of human beings. We are a part of nature, after all.

1. Nature’s Web of Life Fills Every Niche


As we learned in grade school, nature fills every niche with life. Day or night, in hot places or cold, and in every nook and cranny, if there is an opportunity nature will find a way to exploit it. This ability to specialize gives the world great diversity and abundance. The web of life also provides stability and co-dependence between creatures.

The free-market functions like a web of life. We all have unique talents and skill levels that enable us to specialize in producing different things. We each have a niche to fill. It is this diversity of aptitude and genius that drives the productivity of the free market.  Ludwig von Mises called this diversity the “Law of Association.” He believed that specialization fosters interdependence among us and these forms of association and cooperation create society.

2. Interference Creates Unintended Consequences


Environmentalists know that using herbicides and insecticides will have unintended consequences like polluting water, killing bees, and poisoning the soil. Those unwanted weeds may have been part of the ladybug’s life cycle.  When ladybugs are needed to eat aphids, they will have gone elsewhere. eliminating undesirables in an ecosystem with artificial contaminants causes a ripple effect of negative consequences.

Likewise, when the government picks winners and losers in an economy, it acts as an artificial contaminant in the market. Inevitably, a negative ripple effect results. For example, note the businesses that have been negatively impacted by the implementation of increased minimum wage laws, and were forced to close their doors. Now those employees have no jobs. The law was created to help, just like an herbicide or insecticide, but it destroyed businesses and reduced jobs. Every law and regulation made by the state throws off the natural order and balance of the free market.

3. The Smallest Organisms Are the Foundation for Success

farmersmarket ladies

The key to a healthy garden is healthy soil.  Think of soil life as the base of a pyramid.  Stacked on this base are plants, insects, and finally animals.  Within a tiny teaspoon of good soil are a billion bacteria, a million fungi, and ten thousand amoebae.  Those microscopic organisms support all the life above it.  The stately trees would die if microorganisms weren’t producing nutrients for their roots.  The first rule of permaculture is feed the soil.

In our society, large corporations get all the attention as job creators.  But those companies are only a conspicuous smaller part of what’s going on in the market, like the big trees.  Small business is where the real economic power lies. Out of all of America’s employers,99.7 percent are small firms and over 50 percent of working people are employed by small businesses.  The most important thing we can do for our economy is to feed our small businesses by removing regulatory red tape and taxes which stunt entrepeneurship.

4. Do Not Remove the Excess

Leaves don't rake

In traditional gardening, all the dried leaves and fallen fruit are raked away. In permaculture, the debris is left where it has landed. Matter is never taken out of an ecosystem because it drains nutrients and weakens the entire system. The dropped leaves from a plant or the log of a fallen tree, for example, provide richness needed to improve the topsoil and provide food, shelter, and nourishment for other lifeforms.

In a free market, the excess must also never be stripped away. Taking taxes from consumer and producer surplus is called “deadweight loss.” It distorts the economy, human behavior, and can negatively affect long-term trends. In a free market, each unique person decides how their money will be used. Perhaps it will breathe life into new ideas, or create new companies and new jobs. Don’t rake me, bro!

5.  If You Build It, They Will Come

build key hole

Permaculture promises that by putting mulch on barren soil miracles will happen. And they do; worms will appear and the soil will be improved. A hole dug for a pond and filled water will soon grow algae and micro-organisms.  These activities created the conditions for a waiting life energy to thrive and a foundation for bigger things, like dragonflies and birds.

“If you build it, they will come.” You might have heard this quote in “Field of Dreams,” but it is also known as Say’s Law. Jean-Baptiste Say was a French economist and businessman who argued in favor of competition, free trade, and lifting restraints on business. He believed supply creates its own demand. Did we know we could have utilized Facebook and iPhones before they were invented? After their introduction, of course, we discovered we could.

6. The Earth and Human Activity Are Evolving

boy nature meditation

The Earth has a relentless will to continually become more complex and diverse. Under the right conditions, grasslands, which are considered immature, will become shrubland and then mature forests landscapes. This is called ecological succession. This principle explains why it is difficult to maintain a lawn.  In most circumstances, a manicured lawn fights the will of nature.

I suspect the free market encourages the maturation of humankind just as ecological succession develops the Earth into more complex and mature expressions. What would a mature mankind be like? I propose we would be peaceful, no longer experience poverty, and have rich culture and wisdom. It is known that economic interaction fosters peace between people. People flourish when they cultivate their talents and don’t have to worry about basic necessities. It is then that we can nurture culture and generosity towards one another.

So help the Earth and mankind evolve by planting a tree and starting a business. If we keep the Round-Up and regulations off them, maybe something wonderful will grow.



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  • Tar Bigs

    A very thoughtful and insightful article. Great job!