9.8. Our Crisis of Information

The free market approach to producing information is failing.

Free markets work according to supply and demand.

When the demand is high, or the supply is scarce…the price goes up.

And when the supply is abundant, or the demand decreases…the price goes down.

Producing information—whether it’s knowledge, media, or art—is one of the most valuable things we do.

And so the demand for good information is always high.

But think about what’s happened to the supply of information over the past 25 years.

Back in the day, the supply of information was limited.

There were physical costs and constraints.

There were limits to the number of books, newspapers, and magazines you could produce and store.

There were limits to the recording and storage devices of artists.

There were limits to who had access to all that media.

With low supply and high demand…all that information was expensive.

Expensive enough that even with the costs distributing all that information, journalists and scholars were able to earn a comfortable living, as they should.

But the invention of our new information and communication technologies has totally blown up this equation.

With information being so easy to store, copy, and transfer…the supply has exploded.

There’s enough room on a simple thumb drive to contain whole libraries worth of information.

It used to be easy to force people to pay when they bought a physical book, newspaper, magazine, DVD, or CD.

But now, with a little bit of effort—and very little risk of getting punished for it—you can obtain pretty much any type of information you want for free.

In short, the free market approach to producing information is failing.

It worked just fine in a pre-digital era, when the physical costs and constraints put limits on the supply, and forced people to pay up when they consumed it.

But now, what incentive do people have to pay for it, when it’s so easy to get it for free?

You may like it, as a consumer. But it’s been disastrous for the producers.

There’s nothing magical about supply-and-demand. Sometimes, it leads to fair wages. But other times, it doesn’t.

Sometimes, people get overpaid for the work they’re doing.

And other times, people get underpaid.

We already know that certain people do really important work, but aren’t compensated fairly.

And now, the same thing is happening to our information workers.

We keep trying to cram the work of journalists, academics, and artists into this free-market system through paywalls, subscriptions, and lawsuits.

But that doesn’t address the core problem.

Because this is a systemic failure.

Treating information like a commodity to be bought and sold in a free market just doesn’t work well anymore.

It means journalists, scholars, and artists who do such important, valuable work for our society are increasingly getting paid peanuts.

We need to figure out how to correct this market failure.

We need to figure out how to subsidize the important work these people do, so that they’ll keep doing it.

We need to think of information not as a commodity, but as a public good—like roads or lighthouses—created and maintained for the benefit of all, rather than something to be zealously guarded and charged a premium to access.



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