There are usually two minds in the debate on regulation of markets:
• The liberal point of view, which says that consumers are two stupid to make decisions for themselves, and wind up being duped by much smarter, and intensely evil, corporations into making poor choices. If people were only smarter, they would choose mom & pop stores over superstores, locally grown over distantly grown, organic over artificial. And they would NEVER eat fast food. But because they aren't that smart, they need a government to force them into these wise choices.
• The free-market point of view, on the other hand, feels that consumers are plenty wise, at least as wise as the average liberal would-be benevolent dictator, and that there is nothing wrong with superstores, food shipped over long distances, inorganic food, or especially fast food.
I have normally sided with the free-market point of view. I feel that if the consumer is too stupid to make choices for himself, he will be too stupid to vote wisely to elect a government that will make more intelligent choices for him. I feel superstores are magnificent, "locally grown" is a crock, as is "organic", and I feel that the date that the first McDonald's opened in Beijing should be an international holiday.
The other advantage of consumers being able to make decisions for themselves is that intelligent consumers are left free to make wise choices, and the less intelligent can learn from their example. But if everyone has to live their lives, in detail, according to the dictates of some ham-fisted government, then the intelligent may be required to make stupider choices than they otherwise could have, and society has little chance to improve.
An interesting case is childhood vaccines. We have seen a panic about childhood vaccines in recent years, in spite of scientific unanimity that these vaccines are harmless and extremely beneficial. But the court of public opinion is failing spectacularly - we have many people choosing not to vaccinate their children. We are experiencing considerable health problems due to this hysteria.
But one form of regulation that I have felt is benign is consumer information requirements. Those labels the government makes producers put on all food to indicate the amount of calories, carbohydrate, protein, and sugar in the food are very constructive. In 2003 I lost 40 lbs, mostly by looking at those labels and seeing how many calories were in everything. To this day I buy Tropicana orange juice because, according to those labels, it has less sugar in it than any other brand. And I feel that it is very healthy that when you buy a new car, there is a big sticker in the window showing the EPA estimated gas mileage.
If some disclosure regulation winds up being misguided, at least it is only a disclosure, not a requirement. People are still free to make any choice they want, so the potential harm is limited.
We are running into an interesting case with GMO foods. As far as I can tell, anyone competent at biology agrees that GMO foods are at worst harmless and at best extremely beneficial. But big corporations are promoting GMO foods, and to many liberals, that settles the issue -- if corporations are promoting something, it must be evil.
Measures have been proposed to make food sellers disclose whether foods have been genetically modified. This blog from Scientific American shows a true liberal in agony over this issue. While he hates corporations and does not have much respect for the consumer, he is against the disclosure regulation because he feels it will influence people to make stupid decisions.
So where should a free market person stand? Respect for the consumer leads me to side with telling them the whole truth and letting them decide. But I do anticipate that we could easily wind up with an anti-GMO hysteria as stupid and pervasive as the anti-vaccine hysteria. Does the end (preventing a stupid hysteria) justify the means (depriving people of information they want to know)?