Originally posted by: totalnoob
Originally posted by: WhipperSnapper
Originally posted by: totalnoob
Yes, government is authoritarian..but there is a huge difference between it being an authoritarian policeman or judge who defends people from harm and settles disputes than in being an active participant in the economy..tinkering and manipulating people's lives...confiscating and redistributing wealth..deciding winners and losers, etc. Some authority is needed in any civil society to banish theft and violence..but that is the only proper use of government. Rather than banishing theft and coercion, socialism REQUIRES these things to achieve it's ends (equality of outcome, finite material goods that become "entitlements", etc).
So are you advocating pure laissez-faire capitalism--something like what Ayn Rand described where the only proper function of government would be to have a police, a military, and a courts and perhaps merely a stamp tax of some sort or a tax on formal contracts to fund the government?
That would be ideal, yes.
Who decides exactly what constitutes an initiation of force? If I claim that I own a large patch of land or resources and then someone else says they have a better use for it (and they do, in fact, objectively have a better use for it) and then I use the power of the government to prevent the claimant from using that land or resources, might we say that the I have, in actuality, initiated physical force against the claimant since he has more of a moral right to it than I do?
What use someone might have for your land is irrelevant. If you earned or purchased your property with a legal contract, nobody has the right to violate it regardless of how noble their intentions may be.
My point is that conflicts of interest exist between rational people and that it's impossible to construct a society without the initiation of force by one party or another in some sort of a way. The issue should be--how do we construct our society to best serve the rational selfish interests of all the individuals in our society?
The best way to construct such a society would be to respect people and their property rights. Such a society only needs to laws on the books..
#1 No theft.
#2 No violence.
Other than that, leave people to live as they please...free to conduct their affairs as they please...free to form relationships in the bedroom AND the boardroom without government interference..so long as rules #1 and #2 are not violated. The definition of initiation of force seems fairly straightforward to me. Your right to swing your fists wildly stops where your neighbor's nose (or property) begins. Of course there will be variations of those laws (specific rules against fraud, extortion, death threats, etc)..but as long as you respect the principle behind the basic ideals and have a court system to arbitrate disputes under objective law, there is no need for any more government interference.
What if it turned out that having 50% socialism and 50% capitalism were the best way to do that and that it maximized wealth and contentment whereas true laissez-faire capitalism, in comparison, would lead to mass misery, poverty, and to de facto enslavement for huge amounts of people?
What if your assumptions were wrong? (They are.)
Party A makes a deal with party B that includes burning tons of radioactive waste and pumping this into the atmosphere. This radioactive cloud then drifts over a residential area. In your world of totally free markets, party A and party B would have to enter agreements with everyone who's air has been violated in order to come to an agreement. This externality problem has already been addressed by Nobel prize winner
Ronald Coase. Of course, Coase won the nobel prize for his theorem and then had to spend time trying to tell economists that it
doesn't work because it is premised upon a condition that never exists in the real world (zero transaction costs). In this example, each individual in the community would have to negotiate a contract with party A and B resulting in lost time and additional resources. There may also be holdouts resulting in no deal between A and B at all. Game theory suggests that the Nash Equilibrium to our game is a collective bargaining agreement between the community as a whole and parties A and B. In other words, a government.
The model you suggest in dealing with externalities is the least efficient model possible. Rugged individualism also doesn't address the problem of corporations, in that corporations or even individuals can collude to create cartels, an option that inevitably leads to higher profits but pushes huge negative externalities onto those consuming the product. It also doesn't address huge information assymetries that exist between large corporations and consumers. It also doesn't address huge cost of entry problems into many markets that stifle, not promote, innovation. It seems most big "L" Libertarians don't actually have a firm grip on the purpose of a market or the necessities of the perfect market or perfect competition. While they love to focus on government, they can't fathom that other large agencies, and even charities, are market distorting factors that will impede your transactional freedom as well as other liberties.
Furthermore, Capitalism and Socialism are ideologies whose purpose is to describe resource allocation, not liberty. The free market does not guarantee your right to religion or speech, in fact it is rather agnostic about these things. You must understand, there is a difference between those freedoms enumerated in our Constitution and transactional freedom, which is a hallmark of your brand of Capitalism. The latter does not ensure the former. Capitalism does not respect you or your Constitutional rights.
This is especially heartbreaking when you consider that free markets often result in monopolistic practices (which is expected, given the nature of people to incorporate and profit maximize). What if my power company was privately owned and would only service people who've signed a contract to only worship a Christian God (not saying this would happen, purely for the sake of discussion)? What would my options be? Most people in this country can't afford to provide their own power, and my personal options would be to sign the contract or go without power. Great, I'm now severely restricted in my activities. The traditional Libertarian response would be, "Ok, so a competitor comes along to serve you."
But how is that going to happen? This is competely free market, so the new competitor would have to run new lines to service me. This means running those lines across property where the established producer already has rights. So I approach the owner of that property and try to get rights. Awesome for the owner, bad for me. The owner's best interest is to engage to the two competitors in a bidding war. With a little bit of logical thought, you reach the conclusion that the only way for a new competitor to compete with the established competitor is if it starts with the same amount of resource already present. This is why when we address things like telecoms, the Pareto superior alternative to private ownership of physical media is almost always collective ownership. It is possible for Socialist ideals to lead to a
more efficient allocation of resources. This is especially true in areas with an extremely high cost of entry (infrastructure) or massive problems of information asymmetry (healthcare is a good recent example). This is why the perfect market has such stringent preconditions. No one actually expects they can exist in the real world.
Listen, Libertarianism as it might have existed 250 years ago in an agrarian society is a great economic ideal. Every man can live off the land if that is the extent of their ability. But even then, people were pragmatists. You can read Jefferson's Virginia Constitution to see that he promoted ensuring that every man had a minimum amount of land to till. These men were not only shaped by their experiences with the King, but also their experiences with European government and society as well. Jefferson himself was particularly influenced by conditions in pre-Revolutionary France. It was easy for him to observe that men toiling away and sacrificing their lives for a barely living wage was not freedom. Completely free markets are not liberty maximizing, they are profit maximizing. If you want an author far wiser and inciteful than Ayn Rand, just read some of Jefferson's work.
In summary, big "L" Libertarianism will fail in today's world. When the market players are small, the externalities created by transactions are largely minor and contained. Today's world necessitates the pooling of resources into corporations. Many of these corporations are strictly better off by cooperating with each other, either explicitly (contractually) or implicitly (price signaling). Their existence ensures that a perfect market can't exist as their prerequisites cannot be met. The best view a big "L" Libertarian can take is that the purpose of the government is to ensure the market is as perfect as possible. But we still need some collective ownership. Especially if we can show that some collective ownership leads to a more efficient system (Pareto superior) than a strictly private system. Ideology is great, but we live in the real world.
Also, Alan Greenspan was one of Ayn Rand's close friends, and apparently had a great respect for her work. The same Alan Greenspan who was anti-regulation until the market became so imbalanced that entire economies were placed at risk due to the negative externalities of these transactions. Now, he recognizes that these markets must be at least somewhat regulated. Regulated to
gasp control externalities.
Facebook
Twitter