There’s been a lot of talk about “fake news” lately, apparently because some people blame it for Donald Trump’s election. Over at Bloomberg View, columnist Noah Feldman, who’s also a professor of constitutional and international law at Harvard, thinks it’s time to do something about it. Basically, he doesn’t think our experiment with free speech is working out:

In the free marketplace of ideas, true ideas are supposed to compete with false ones until the truth wins — at least according to a leading rationale for free speech. But what if the rise of fake news shows that, under current conditions, truth may not defeat falsehood in the market? That would start to make free speech look a whole lot less appealing.

I’ll leave the legal analysis up to the lawyers (Scott Greenfield’s review of this article is scathing), but I think the professor has an interesting analysis of the problem. I think his solution is wrong, which I’ll get to later, but his analysis is still interesting.

But to take the marketplace metaphor seriously means admitting that sometimes, markets fail. Holmes himself gave us the most famous example of market failure when he said, in a different 1919 case, Schenck v. United States, that even “the most stringent protection of free speech would not protect a man in falsely shouting fire in a theatre and causing a panic.”This thought experiment in turn led Holmes to his most famous formulation of free speech doctrine: that the question in every case is whether the words “create a clear and present danger.”

Falsely shouting fire in a theater is a perfect example of market failure in the communication of ideas. The person shouting knows he is lying — but others don’t know, and won’t have time to check. The words will cause an immediate panic, even if everybody is acting rationally, because the only logical thing to do is to get out, and get out quickly.

The “marketplace of ideas” is mostly a metaphor, not a literal marketplace, but putting aside the questionable value of Holmes’s example, this is actually a fairly good analogy to the kind of market failure that can occur because of asymmetric information between the parties.

As the Nobel Prize winning economist George Akerlof showed in his classic 1970 article, “The Market for Lemons,” asymmetric information can systematically distort the quality of what’s available in the market. In his stylized example, if good cars and lemons are both for sale, and consumers know this but don’t know which are which, they will be willing to pay the average price. That will lead the sellers to withhold the good cars, which could fetch a higher price — but that in turn will lead consumers to lower the price they are willing to pay. The resulting spiral of adverse selection leads to market failure.

As it happens, it’s a lot more expensive to generate true news stories than false ones. News requires reporting and research and institutional structures like editors and fact checkers to support them. Fake news only takes one person’s imagination. And there is certainly information asymmetry between the person who writes a story and the person who reads it. Applying the Akerlof analysis suggests that fake news could conceivably drive out true news.

This is an interesting example of applying economic thinking to a problem that is not normally considered economic in nature. “The Market for Lemons” argued that in the presence of asymmetric information about quality, buyers wouldn’t know how to identify quality products and therefore the market would not reward sellers for quality. Sellers of high-quality products would therefore leave, and the process would spiral down until only very low-quality products were trading. In the worst case, the market would disappear completely.

Ackerlof’s paper takes asymmetric knowledge about product quality as a given, but in real-world markets it’s often not clear whether asymmetric information is a serious problem. That’s not a slam on Ackerlof. He was clear about his assumptions, and there’s strong evidence that asymmetric information does cause real problems in some markets. (It rules how insurance plans are designed and sold.) But there’s also evidence that many real-world markets have found ways to circumvent the problem.

The most common solution is for sellers to try to reduce the information asymmetry by establishing and maintaining a reputation. This makes use of the fact that buyers will want to purchase the same product over and over, so if a seller has a history of producing good products, buyers can rely on that history to guide their purchasing decisions. This sets up a positive feedback loop: The seller’s reputation gives buyers confidence in the product and therefore a willingness to pay more money, and that increase in potential future revenue makes it valuable for sellers to have a good reputation, which makes it worthwhile for sellers to build a good reputation by expending the effort to produce a quality product.

Another common solution is for buyers to try to reduce the information asymmetry by relying on third parties to provide reliable assessments of product quality. I had to buy a snowblower for the first time this year, and I relied on information from knowledgeable friends, Consumer Reports, a variety of web sites, and online buyer reviews at Home Depot, Lowes, and Amazon. In this age of the internet, information is easier to find than it’s ever been.

(Other solutions, such as offering easy returns and product warranties are effective as well, but I can’t see a way to apply them to news.)

Feldman, however, doesn’t seem interested in any of these solutions. He goes straight to stepping on necks:

The classic solution to market failure is regulation. Holmes, in his fire-theater example, certainly believed that was permitted by the First Amendment.

The question is whether government regulation of fake news would be justified and lawful to fix this market failure.

Justified? No, not even under Holmes’s example. If you’re in a crowded theater and someone shouts “Fire!”, your best move is to get out as fast as possible. You don’t have time to reflect on the shouter’s claim and debate it with your fellow theatergoers. The “market failure” in shouting fire in a crowded theater is that there’s no time for the “marketplace of ideas” to operate.

Reading the news doesn’t come with that kind of urgency. There’s plenty of time to research stories and read what other people are saying about them.

Obviously, it would be better if the market would fix the problem on its own, which is why attention is now focused on Facebook and Google. But if they can’t reliably do it — and that seems possible, since algorithms aren’t (yet) fact-checkers — there might be a need for the state to step in.

Here’s where Feldman tries to play a trick on his readers. He starts by saying the problem is that Facebook and Google are unable to function as fact checkers, which is fair enough, and then he says the state should “step in.” But he doesn’t just want the government to provide the fact checking that he says is needed. He wouldn’t need to write an article about that because fact-checking isn’t legally controversial: Government employees are free to research the statements of fact within a news story and publish their evaluation, and government press offices do that all the time already.

No, what Feldman wants is for the government step into the marketplace of ideas and pick winners by force, which is why he runs into concerns about constitutionality.

Under current First Amendment doctrine, that wouldn’t be allowed. The Supreme Court has been expanding protections for knowingly false speech, not contracting it. And it would be extremely difficult to separate opinion from fact on a systematic basis.

From there, Feldman’s argument dissolves into attacking a straw man with a flurry of hand waving:

But we shouldn’t assume that the marketplace of ideas works perfectly. And given that, we shouldn’t be slavishly committed to treating the marketplace metaphor as the basic rationale for free speech.

Perfection is not the standard. I don’t think anyone believes the marketplace of ideas is perfect. But if you propose to replace the free market with something else, you should at least do your audience the courtesy of trying to explain why your proposed solution would be better, and Feldman doesn’t even try. It’s like he thinks it’s just obvious that of course government can do this.

The current freakout over false news depends on two major items of concern: (1) That fake news is produced by liars, and (2) that fake news is believed by fools. Feldman’s proposal is utterly lacking in detail, but I’d love to hear why he’s so sure that his solution will not be created and carried out by more of the same liars and fools.

For Christ’s sake, we’ve spent the last year and a half watching a gruesome demonstration of how government leaders are chosen. What in God’s name makes anyone think those people should have the final word on what’s true in the news?

False news that hinders public discussion and encourages irrationality may have a role in the marketplace; but it doesn’t contribute to the good functioning of democracy.

Speaking of democracy, politicians are notorious liars. Unsurprisingly, so are a lot of the government functionaries who work for them. I’m not talking about crazy anti-government conspiracy theories, either, I’m talking about the routine lies that government employees tell to keep their jobs and make them easier: Cops lying about incidents, experts exaggerating their credentials, and department heads who refuse to recognize facts that would be inconvenient for the continued funding of their departments.

I’m talking about the Drug Enforcement Agency refusing to recognize the medical benefits of marijuana long after its acceptance by the medical community. I’m talking about the Tuskegee syphilis experiment. I’m talking about the numbing sameness of the lies that many cops tell on the stand. I’m talking about the legal fictions that label people as drug dealers when they don’t deal drugs, as pimps when they aren’t pimping anyone, and as money launderers when they aren’t laundering money.

I’m sure Professor Feldman imagines that when the government implements his fake news suppression program they will decide which news is real or fake with the help of wise and honest scholars (such as himself). I think it’s more realistic to assume it will be staffed by people like TSA agents, DMV clerks, and those public school administrators who call the cops when a kid makes a shooting gesture with his fingers.