> If this were true, corporations and rich individuals would own everything. They don't.
Uh, there is very little they don't own or control, to be honest. Even if they didn't, assuming the current trend of privatizing even the most essential services continues, it will be the case in just a couple of decades.
> Are you having trouble buying groceries because corporations and rich individuals have snapped them all up?
Am I having trouble buying some groceries, because rich people have pushed prices so high, or in some cases because corporations buy all of them in order to resell them in a different, more expensive form? Why, yes. But I digress.
> In a true free market, if there are no such customers--because what you're selling isn't worth enough to any of them to pay a price you are willing to accept--then you go out of business.
Do you seriously think a service like TSA is not useful to any corporation? Like franchise shops in airport lounges selling bottles of water at three times the market price...
Also, your reasoning completely ignores forces, like advertising, which are used to create artificial demand. They would still exist in a free market, probably even more so (because competition would be even harder).
> That principle would apply just as well to services like law enforcement, if they were provided in a true free market.
Rich people would enjoy premium protection at premium prices, and poor people would receive little or no protection because they cannot afford more. Wouldn't that be fun, eh? Reminds me of the US healthcare market, that other miracle of the Free Market.