Market competition is treated across several episodes of The Bob Zadek Show as the preferred mechanism for determining quality and for checking concentrated power — in education, in labor markets, and in pharmaceutical regulation. Guests and the host disagree over how reliably it performs that function, and over whether it can reach private as well as governmental coercion.
Education: the 2014 voucher exchange
In a February 2014 episode, Bob Zadek framed the education debate by asking what makes public education — “education where the vendor is government” — better per se than private education, and asserted that in a competitive environment the marketplace is the best determiner of what is best Aren’t Men Entitled to Due Process on Campus? (2014).
John Rothmann rejected the claim directly, calling it rubbish and illogical. He argued from cost and from funding: sending his son to one of the best private schools in San Francisco would cost at least $40,000 a year, while Lamar Alexander was proposing $2,100 for those who meet the requirement. Rothmann said that if Alexander’s bill passed the Senate it would take $24 billion, 41% of current federal spending at the elementary and secondary level, and that this would gut public education and limit rather than open choice. He also said private religious institutions, and Catholic schools in particular, had pushed hard for vouchers, that the measure had been put on the California state ballot three times and lost three times, and that he believes in a firm separation of church and state. He cited his own credentials — a Master of Arts in teaching, a secondary teaching credential from the state of California, and forty years as president of the Washington High School Alumni Association — and said the voucher propositions failed because they do not make education better but only take money away from public education. The exchange then moved to a segment labeled “The Pell Grant Model and Market Competition,” where the excerpt breaks off.
Private power and the limits of competition
A June 2014 episode with Matt Zwolinski supplies the article’s most developed account of what competition is supposed to do. Zadek observed that libertarians abhor and fear any concentration of power, whether in the executive branch in Washington or through unfair business practices, and said it is the power component that scares them Matt Zwolinski on Bleeding Heart Libertarianism (2014). Zwolinski agreed, saying that power component gives rise to what can fairly be described as a kind of coercion, and that while libertarians usually discuss coercion in terms of the state pointing guns at people’s heads, there is also such a thing as private coercion and force, which libertarians should find equally troubling.
Zadek then offered the observation that the only distinguishing factor of government among social institutions is that it is the only institution permitted to use force, so that talking about government doing something means talking about the only organization allowed to point a gun at us and deprive us of liberty. Zwolinski said that was absolutely right and vital to remember, but hesitated to agree that government is the only institution authorized to use force.
Zwolinski’s positive claim was that market competition usually prevents corporations from exerting undue coercive power over employees and customers, because if a company tries, another will sweep in with a better deal. Zadek qualified this — at least in the long run; a firm might do it in the short run but not in the long run. Zwolinski agreed, adding that in the long run and in usual circumstances corporations cannot exert too much power over employees or customers, but that cracks emerge, either because of an economic downturn or because some firm acquires temporary monopoly power — usually because government has given it to them, but sometimes on their own. In those cases, he said, libertarians need to worry about coercive power wielded by private firms and not just by government.
Pharmaceutical regulation and suppressed competition
A November 2020 episode with Dr. Jeff Singer gives the concrete regulatory case. Singer listed the ways a drug can be converted from prescription-only to over-the-counter: the manufacturer petitions the FDA, any interested person petitions, the commissioner decides, or Congress passes a law Dr. Jeff Singer on Prescription Drug Freedom (2020). He said that for the last 20–30 years, probably due to a certain amount of regulatory capture, the FDA has deferred to the manufacturer regardless of what individual groups petitioned for.
Singer’s example was antihistamines. The over-the-counter antihistamines were very sedating — Benadryl, for instance, was sedating enough that the FAA would not allow a pilot to fly a commercial airplane under its influence. In 1993 Schering-Plough brought out the first non-sedating antihistamine, Claritin; Zyrtec and Allegra followed, and all three were prescription-only, so that the safe non-sedating drugs required a prescription while the more dangerous sedating ones did not. Schering-Plough lobbied European regulators to make Claritin over-the-counter, and it was over-the-counter in Europe while prescription-only in the United States. In the late 1990s some health insurance plans petitioned the FDA to make it over-the-counter, and Schering-Plough protested and lobbied successfully against it on safety grounds — arguing to European regulators that the drug was safe while arguing to the FDA that it was not, because the company was making a great deal of money on it, as were the makers of Zyrtec and Allegra. In 2002 Schering-Plough came out with a new prescription non-sedating antihistamine and then supported making Claritin over-the-counter; Claritin became over-the-counter in 2002, Zyrtec in 2007 and Allegra in 2011. Singer called this a perfect example that the prescription requirement has nothing to do with safety.
He gave naloxone as a second case: the FDA had practically been begging the makers of naloxone, particularly Narcan, a nasal spray, to make it over-the-counter, saying it had been around since the 70s, is safe to use by non-professionals, and that if you do not need it nothing will happen if you take it. Commissioner Scott Gottlieb said the agency had already filled out the application and pre-approved the labeling and all the manufacturer needed to do was sign. Singer said that in October 2019 he participated with a colleague, David Hyman, an adjunct at the Cato Institute, in a Capitol Hill briefing explaining to Capitol Hill staffers why Congress should pass a law making naloxone over-the-counter, and that sales representatives for the makers of naloxone tried to contact them before the meeting and cornered him after it, arguing it is actually cheaper for people if it is prescription-only — $145 for two Narcan nasal spray packets, but only a $10 co-pay with insurance. Singer’s reply was that people using IV heroin on the streets do not usually have their insurance cards with them.
Singer’s conclusion was that taking the government and politics out of this allows market competition to enter the fray. He also said this is not the panacea, that the paper spends time on other parts of the regulatory system that seriously need reform, and that this reform is an important place to start and would go a long way toward improving affordability and safety.
Labor markets and administrative bloat
An August 2022 episode with Corey DeAngelis applies competition to the market for teachers. Zadek put the case in terms of self-interest: in a public school environment there is basically one employer, and compensation is not based on merit but on union negotiations and tenure, whereas private schools have to get customers and offer a good product and therefore have to reward good teachers, so a competent teacher ought to be highly motivated to encourage private schools Students, Not Systems (2022). He asked whether he was being naive.
DeAngelis said the government school system is a monopoly, which is bad for customers, and at the same time a monopsony — pretty much only one big employer — which is bad for employees, and that individual school teachers should be fighting for school choice rather than against it, because it leads to more competition for their employers, who then have to compete on provided autonomy and benefits. He cited five studies on the topic holding that school choice competition leads to higher salaries for public school teachers, and said competitive pressures lead to higher portions of dollars going to teacher salaries, which is what the data show. He illustrated with DC: at an average class size of 30, spending over $31,000 per child per year comes to about $930,000 per classroom per year, while teachers make about $80,000, leaving roughly $850,000 going to administrative bloat and wasteful spending — about 8 or 9 percent of total in-classroom spending, though he acknowledged pension benefits and other non-salary benefits for teachers. He mentioned data released by Ben Scafidi before Zadek cut in to ask how listeners could follow his work; DeAngelis pointed to his Twitter handle, his work at the Reason Foundation and the Cato Institute, and a podcast called Random Assignment at choicemedia.tv.
Across episodes
The three episodes that develop the concept do not form a single argument. Zwolinski (2014) treats competition as an effective but imperfect check that fails in cracks created by downturns or monopoly power; Singer (2020) shows firms and regulators actively suppressing competition in drug classification, and calls removing government from the decision a way to let competition enter; DeAngelis (2022) extends the monopoly/monopsony framing to schooling and to teacher pay. Rothmann (2014) is the only speaker who rejects the market analogy for education outright, and the excerpts show no later episode returning to answer him.
What the sources do not cover
The excerpts do not establish any empirical measure of how competitive the markets discussed actually are, beyond the studies and figures the guests cite. They do not say what Lamar Alexander’s bill was called, what any court held, or how the voucher ballot measures were titled. The February 2014 excerpt breaks off mid-segment on the Pell Grant model, and the June 2014 excerpt ends with Zadek welcoming listeners back from a break.