Lynn Stuart Parramore has an article at Reuters about a whole bunch of medical scams that are sold as miracle health products without a shred of evidence to back them up. And I think she’s absolutely right to point out that it is dishonest marketing that makes them so popular:
As consumers, we like to think of ourselves as savvy and rational. But marketers have always known better. The health food and dietary supplement industries, in particular, have long made a mockery of the rational consumer.
They delve into our wounded hearts with evangelical calls to detox and purify. They bend our minds with pseudoscientific drivel and armies of so-called experts who tell us that instead of fresh, nourishing food, we need supplements and specially treated products.
Never mind that mounting evidence suggests the contrary. Our self-control is subverted by clever ads and our rationality crumbles when everything from upscale health stores to 7-Elevens stock pills, powders and products that would make a snake oil salesman blush.
While we may be alert to crude promises of miraculous results, we’re not so good at sussing out the more insidious distortions and oversimplifications – especially when it comes to something as intimate as our bodies. Human emotions and self-delusion tendencies get in our way.
Let me apply this to a seemingly disconnected issue: This is also why the libertarian idea that the market will correct for all the bad stuff because consumers will refuse to buy products or services from a company that mistreats its workers or harms the environment or any other externality that we use government regulation to prevent is a fantasy. We can call this the Myth of the Rational and Informed Consumer. As I wrote a few months ago:
The libertarian argument is that in a free market, consumers would choose not to do business with a company that caused a large amount of pollution and, because the company knows that, it will have an incentive not to pollute. This is so absurd that I consider it a utopian fantasy. It fails on several levels. First, most consumers have no knowledge of what any company has done to damage the environment, and when they do know, the overwhelming majority simply doesn’t care.
How many people are now refusing to buy gas at BP stations because of the Gulf oil spill? That was the probably the most widely covered environmental disaster in American history, perhaps in world history (Chernobyl is probably up there too). There was a massive amount of negative press aimed at BP. The next year, 2011, they had a profit of $25.7 billion. Even the most widely publicized environmental disaster did almost nothing to hurt the company responsible for it.
Has the company responsible for the Love Canal disaster been punished by consumers for their behavior? Hell, could more than 1% of the public even identify that company? I had to look it up myself. It was Hooker Chemical, now called Occidental Petroleum. It made more than $10 billion in profits last year. Is there even a single major company that has gone out of business or even had a serious dent put in their profits by being responsible for an environmental disaster? I can’t think of one.
I still can’t think of one. Corporate bad actors have little to fear from even those few consumers who are informed enough to know that they’ve done something horrible and nothing at all to fear from the overwhelming majority who are completely unaware of it. In the end, dishonest marketing wins almost every time and it’s because the vast majority of people are ignorant, apathetic or both.
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