Government vs markets: propaganda

One may be tempted to claim that a difference between governments and the market is that in markets businesses use advertising to lie to customers and propagandize. This assumes that people are mindless zombies, easily misled by a well done ad. 

This is not true. Even a well done ad cannot make up for a lousy product or poor service. In the short run, businesses could make money by tricking people, but to make any real money companies have to offer a product or service that meets the needs of their consumers.

How do we deal with one time purchases? While most companies produce multiple products and will want your business in the future for new products, how do we deal with those one off situations? The market has a solution. Companies exist that review products and/or give recommendations. These companies want you to continue to use their services so they want to be accurate.

In these ways the effects of propaganda by market participants is short lived. But what about government propaganda? Governments claim a monopoly on the school system. What incentives do they have not to propagandize? They control the media through the FCC. What incentive do they have not to abuse this power? The only incentives seems to be that if the people hear about it, they may complain. But they are garnering support for campaign finance controls, so that only the government can decide who can and cannot speak out during elections.

I think the evidence is pretty clear. If we should be concerned about propaganda it is from the government not the market.