This kind of analysis leads naturally to the moral ethic of consequentialism, where a policy is judged "good" if its consequences are good, i.e., the ends justify the means.
So why does this rub so many people the wrong way? Perhaps the biggest objection to consequentialism is that by using markets to allocate goods and services, we turn personal relationships based on love or affection into arms-length commercial relationships based on the pursuit of profit. Philosophers call this "commodification."
This can make a difference if, for example, the "means" of trading pollution permits, changes how we feel about the "ends" of reducing pollution. Specifically, by allowing people to trade pollution permits, we may reduce the stigma of pollution, and make it more acceptable.
So, if some of you get queasy during economic class, you are not alone:
What Money Can’t Buy – which must surely be one of the most important exercises in public philosophy in many years – examines a wide variety of cases in which goods that in the past were believed to be outside the market have been turned into commodities. Surrogate motherhood, paying others to queue for you to attend a Supreme Court hearing, buying the right to immigrate into a country or shoot endangered wildlife, purchasing the insurance policies of ailing and elderly people to collect death benefits and charging fees for a better class of prison cell are just a few of the examples that Sandel deals with.
The problem with this critique, of course, is that we need something to replace economic relationships. And, as the author points out,
...in a highly pluralistic society such as ours, there is not much consensus on the content of the good life. As a result, there is little prospect of agreement on the moral limits of the market. Sandel points out: “We disagree about the norms appropriate to many of the domains that markets have invaded.”
This reminds me of something that Winston Churchill would have said, "markets are the worst way to allocate goods and services, except for every other method that has been tried."
HT: Daniel C.