Externalization - how is it accounted for in the Capitalism ideology?

I was hoping that our Senator Hatrack would provide a more informed explanation, as a practicing Classical Liberal, than I can do with the more superficial knowledge that I possess. As an admittedly oversimplified summary, I understand the Classical Liberal economic model to say that unregulated free markets will provide the best outcomes because self-interest will always prevail - eventually - so negative trends, such as social and environmental decline, will be naturally mitigated. This might be possible if the self-interest was enlightened, but my speculation is that it is seldom so. We might say that a weakness of the CL economic model is that it externalizes the fact that enlightened self-interest among the human animal is as rare as hen’s teeth (notwithstanding a potentially lucrative market for chicken molars...).

Some examples of externalization might be interesting. This is following two posts above; one representing a triple-bottom-line business model (people, planet, profit), the other addressing global warming.

The Patagonia link (Tin Shed Ventures) is all about a company that is trying to acknowledge and act on a triple-bottom-line model - they would like to stop externalizing the costs of doing business. Patagonia may be as good a model for the CL economic philosophy as can be found, but they admit that enlightened self-interest is not an easy row to hoe.

The other post, which concerns global warming, is a rich vein to mine for examples of the failures of free market Capitalism to achieve the best outcomes, but I want to provide just one very interesting case of externalization - climate change denying. The Deniers are responding to just one thing. They do not want to have to account for the effects of climate change as a part of doing business, because they think that doing so will make things cost more. Their self-interest is unenlightened and they very much desire to continue to externalize the burgeoning social and environmental costs, not to mention the unavoidable economic costs.

To tie this back to another thread on Conservatism, I don’t see externalization as a conservative quality. Odd, isn’t it, that Conservatives are the primary proponents of not being conservative?

I call this the Conservative Rule of the Opposite Thang, with the acronym ConROT. Special emphasis on the “Con”.

Senator Hatrack may have a persuasive contrary opinion...
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