Nashville Truth and Emigre with a Digital Cluebat are two bloggers that are avowed libertarians and have espoused the libertarian creed a number of times in our discussions. Actually, one of the first books I ever read on economics (perhaps the only economics book I've ever finished, come to think of it) was Friedman's "Free to Choose." I was about 17 at the time and the book made a deep impression on me. Friedman's radical free-market ideas at first glance all seem extremely sensible. But since then, I've become much more skeptical about the libertarian agenda for several reasons.
First, there's no discussion of how the market can account for externalities associated with specific economic activities. The paradigmatic case is the company that opens a mine, extracts some minerals making the company president millions, and then fails to clean up the mess afterwards. When sued decades later, the company simply goes bankrupt. My own grandfather was personally involved in this as a geologist in the northwest. He made his boss rich (and brought home a decent paycheck while doing so) but two generations later, the mines are still leaching salt and other crap into the local environment and will continue to do so for centuries. The U.S. taxpayer is now picking up the bill.
Second, there's an assumption that the market rewards people's economic contribution in an equitable manner. In Libertarianism, this assumption has taken on the status of an axiom--the money one receives in a free-market is considered to be inherently fair. Yet this is demonstratively false. Any large enterprise requires diversification of labor. Everyone at Microsoft wouldn't become CEOs if they simply worked as hard as Bill Gates. Even if it were somehow possible to churn out Bill Gates doubles on some mad scientist's assembly line, the natural need for diversified labor simply wouldn't support a thousand CEOs. Someone would still have to sweep the floors and fill the toilet-paper dispensers. Since all these people are filling essential roles within an integrated process, you'd think they'd get similar pay, but this doesn't happen.
I guess I might feel more sympathy for the Libertarian movement if it targeted corporate welfare first, with the idea that subsidies to the poor would form the next agenda for their political program. Libertarians have largely allied themselves with the Republican Party, but the Republicans, with their hand-outs to the wealthy, are hardly champions of the free market. Whenever we send an aircraft carrier to the gulf, it isn't there to protect the interest of the poor but rather the business interests of the wealthy elite. Likewise, all the professional organizations, as for example those that limit the number of doctors and so on, are all great friends of the Republican Party. Why don't Libertarians attack such anti-market organizations with the same zeal they reserve for the poor underclass? I think the reason is that the free-market apologists have become lackeys of the Republican Party who are all for free-markets--but only when they benefit the wealthy, their most coveted constituency.