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Do you agree with Dr. Rothbard on taxation?

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woolfe9999

Diamond Member
Mar 28, 2005
7,164
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Obviously. Most natural monopolies, for example. Joe Blow in the sticks would never see electricity, much less internet, because the cost to set up the wiring would not be profitable to the electric company until way way way down the road if ever, compared to immediate profits from other uses for that investment capital. Same goes for roads to every home, postal service to every home. Not everyone will be able to afford schools, and those catering to the poor by definition will have to aim for a high volume, lower quality model.

Then there's the fundamental problems of externalities and information flow. There's no profit-motivated way to deal with company A dumping into the river and making people sick 20 miles downstream. Even if the people strongly suspected that was the cause, the needed investment in time and money to exhaustively research the water chemical levels along the river for 20 miles or more would put it well out of the reach of any given private citizen, or even voluntary collective of citizens. And if they DO prove it, so what? Company A can just sell to the people upstream or in the next territory who haven't heard of the pollution or (more likely) don't care because it doesn't affect them.

Similarly, when company B starts using questionable 'meat' in their sausages that don't make people immediately sick, but build up and cause illness down the road, how are consumers to know (and therefore use the only recourse they have in this scenario, choosing to not buy that sausage)? They'd have to have home FDAs.

Information is expensive in time and often money, certainly in money if we start privatizing all sources of it, and reliable information costs even more time to verify. Not everyone has the time to invest into information gathering to make fully-informed rational choices, even assuming the mythical rational decision-maker existed. We need regulations to give us a baseline of knowledge on which we can act - that our foods are almost always up to a certain standard, same with our water, and any special dangers will be listed for us to decide on.
All valid points. I will add, in reference to your hypothetical about dumping toxics into a river, that there is no remedy for this among consumers because of the basic collective action problem. If company A dumps toxic waste because it is cheap and expedient to do so, and company B - a competitor of company A - is ethical and incurs the expense of proper waste disposal, then company A's product is cheaper.

It is in fact illogical for a consumer to buy company B's product over company A's cheaper product out of protest of company A's behavior, because each individual consumer knows that his purchase decision is irrelevant to the manufacturer's bottom line. He has no guaranty that other consumers will follow suit, and even if they do, then his decision to not boycott company A will make no difference either. The logical choice is to buy the cheaper product, assuming the products are otherwise identical. And this is the logical choice for every other consumer as well. The only way it is rational to avoid the product is where consuming the product itself causes harm, yet as you say, this requires first that the consumer have knowledge of the harm.

The sole remedy, that of after-the-fact litigation initiated by those directly harmed, is inadequate for a slew of reasons. You already mentioned that the expense may be prohibitive. Yet even if it isn't prohibitive, the harm has already been done. Injuries can be compensated for by monetary damages, but who ever said that this is an adequate remedy, particularly for deaths and other serious injuries?

And it isn't going to be a deterrent to future bad behavior either, assuming the cost of litigation and/or settling each claim is less than the added expense of proper waste disposal. This is often the calculus in these situations. If company A saved $1 billion last year by dumping into the river, then so what if they had to settle with 50 families for $2 million apiece? The logical choice for the company is to give their kids leukemia then settle up, not to incur the expense of proper disposal.

And notice how in all of this, company B is penalized for being ethical? The incentive in an unregulated market is to do the expedient and cost-efficient thing, regardless of the harm it causes.

There is no other alternative except to regulate business to prevent these kinds of harms from occurring to begin with.

- wolf
 
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MooseNSquirrel

Platinum Member
Feb 26, 2009
2,581
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Privately through profit seeking entrepreneurship. Government makes it possible to build things that maybe cannot be provided privately because private enterprise cannot force you to pay for something.

The main disagreement libertarians would have with someone like yourself is whether or not a particular project would be worth it even if a free market would determine that a project is not profitable and not worth it.

I'm assuming since you cannot see a way civilization can be built without taxes means you think that certain elements of our infrastructure could not produce a profit on their own if they were privately held and paid for without taxes and as such must be provided for with taxation, is that correct?
I do not believe that (practically) large pieces of a Democratic civilization can be built without taxes.

I also believe that there are pieces of "infrastructure" that can possibly be built by private effort, but that efficiency isnt always the most desired outcome, and in that case it doesnt make sense for a private company to "own" it.

Private/public collaborations have their place, but they must be transparent, or we end up with cronyism.
 

modestninja

Senior member
Jul 17, 2003
753
0
76
Libertarians don't hate civilization, they just happen to believe people can be civil and charitable without the force of government needed to take from them. Nor are they scared like little fucking pussies if everything went to shit simply because they were wrong. Seems to be the MO for everyone else though. ZOMG SAVE ME JEEBUSerr... I mean Mr. President!
Yeah, I mean look at Somalia. Very little government intervention there and last I checked everyone is getting along just fine and private enterprise is creating a virtual utopia.
 

momeNt

Diamond Member
Jan 26, 2011
9,297
350
126
Yeah, I mean look at Somalia. Very little government intervention there and last I checked everyone is getting along just fine and private enterprise is creating a virtual utopia.
Thanks for the boogeyman.

I mean look at China and communist Russia, government intervention is a bad thing.
 

momeNt

Diamond Member
Jan 26, 2011
9,297
350
126
Obviously. Most natural monopolies, for example. Joe Blow in the sticks would never see electricity, much less internet, because the cost to set up the wiring would not be profitable to the electric company until way way way down the road if ever, compared to immediate profits from other uses for that investment capital. Same goes for roads to every home, postal service to every home. Not everyone will be able to afford schools, and those catering to the poor by definition will have to aim for a high volume, lower quality model.

Then there's the fundamental problems of externalities and information flow. There's no profit-motivated way to deal with company A dumping into the river and making people sick 20 miles downstream. Even if the people strongly suspected that was the cause, the needed investment in time and money to exhaustively research the water chemical levels along the river for 20 miles or more would put it well out of the reach of any given private citizen, or even voluntary collective of citizens. And if they DO prove it, so what? Company A can just sell to the people upstream or in the next territory who haven't heard of the pollution or (more likely) don't care because it doesn't affect them.

Similarly, when company B starts using questionable 'meat' in their sausages that don't make people immediately sick, but build up and cause illness down the road, how are consumers to know (and therefore use the only recourse they have in this scenario, choosing to not buy that sausage)? They'd have to have home FDAs.

Information is expensive in time and often money, certainly in money if we start privatizing all sources of it, and reliable information costs even more time to verify. Not everyone has the time to invest into information gathering to make fully-informed rational choices, even assuming the mythical rational decision-maker existed. We need regulations to give us a baseline of knowledge on which we can act - that our foods are almost always up to a certain standard, same with our water, and any special dangers will be listed for us to decide on.

Also monopoly trusts are bad for everyone but the monopoly trusts, and require governments to keep them from forming. But I doubt you'd ever see a well-ordered and developed enough economy under libertarian anarchy to get to that stage.
  1. I'll have to ignore the issue with natural monopolies, as many libertarians contend that they don't actually exist, or only exist in passing and the monopolist must never raise prices otherwise there will be profit-seeking entrants to compete with.

    Also, in regards to how you describe the electricity, roads, postal service, privately provided services like this would dictate how cities and rural areas develop, obviously nobody would have moved out to suburbs 1 hour away from the city while working in the city had the interstate highway system not been established, but now that it is there people are out there and working in the city. So I believe your point is more or less moot.
  2. The foundation of libertarianism is property rights and the protection of property, since areas of rivers would be claimed polluting a river could be something that would be punishable through private courts (if we are going full on anarchy). So the only way you could construe this as an externality is misunderstanding libertarian definitions of property rights.
  3. There are private regulatory firms today, the UL being one of them, their reputation is at stake for every product they stick their label on, they do not have the gift of being a government entity and mistakes by the UL can be disastrous for their business. Do you think competition against the FDA would lower or decrease standards? Or if a private food regulatory firm opened up in a private market do you think it wouldn't gain any traction?
  4. Same response as above basically.
  5. Monopoly trusts, are you referring to Standard Oil? If so I'd like you to further elaborate why Standard Oil's "monopoly" was bad for the consumer, when in fact it was other smaller less efficient oil companies that succeeded in bring Standard Oil down on antitrust regulations. The antitrust regulations turned out to be a subsidy for smaller, less efficient, oil companies.
 

modestninja

Senior member
Jul 17, 2003
753
0
76
Thanks for the boogeyman.

I mean look at China and communist Russia, government intervention is a bad thing.
Thanks for the false equivalency...

He's advocating for no government which is what Somalia has. People aren't just getting along and creating markets and making a better society for themselves, it's anarchy.

I think government has a role in creating a stable society that benefits everyone. That doesn't mean I think a government like communist Russia's is the answer, there are varying degrees of government intervention.
 

berzerker60

Golden Member
Jul 18, 2012
1,233
1
0
I'll have to ignore the issue with natural monopolies, as many libertarians contend that they don't actually exist, or only exist in passing and the monopolist must never raise prices otherwise there will be profit-seeking entrants to compete with.

Also, in regards to how you describe the electricity, roads, postal service, privately provided services like this would dictate how cities and rural areas develop, obviously nobody would have moved out to suburbs 1 hour away from the city while working in the city had the interstate highway system not been established, but now that it is there people are out there and working in the city. So I believe your point is more or less moot.
Good to know urban farmers can feed a centralized population due to what I'm sure will be hyper-efficient privatized urban planning boards to keep traffic and city design in check.
The foundation of libertarianism is property rights and the protection of property, since areas of rivers would be claimed polluting a river could be something that would be punishable through private courts (if we are going full on anarchy). So the only way you could construe this as an externality is misunderstanding libertarian definitions of property rights.
So who gets to just claim the river? Someone who goes and puts a stake in it and says it's his? Does that mean he gets to charge everyone downstream for not selling the "right" he somehow "owns" to pollute in his river? Is he leasing the water that passes through to the cities and farmers downstream? What if it's the ocean? Can I buy rights from someone to dump my nuclear waste in the middle of the Pacific? Who do I negotiate with for that?

How about air pollution? Do you own the wind that blows over your river and your ocean tracts, once we've decided who privately owns what tracts of ocean real estate?
There are private regulatory firms today, the UL being one of them, their reputation is at stake for every product they stick their label on, they do not have the gift of being a government entity and mistakes by the UL can be disastrous for their business. Do you think competition against the FDA would lower or decrease standards? Or if a private food regulatory firm opened up in a private market do you think it wouldn't gain any traction?
Getting around a private regulatory firm structure would be trivial for a successful company. Options: 1) Make your own regulatory firm and use your profits to celebrate it as the only trustworthy one, smearing all the others (for examples even in our economy, see: tobacco industry, climate change deniers, every holistic medicine company); 2) bribe the regulatory agency; 3) buy them out; 4) simply lie to them, having a fancy nice plant for show and lower standards elsewhere; 5) make profits in areas where people are too poor on average to subscribe to the regulatory agency and/or too busy from working hard to have time to educate themselves on the best regulatory agency, then read detailed articles on each and every consumer product they purchase vs. alternatives (ie everyone alive, no one has that time).

Competition with the FDA will neither increase nor decrease standards because they're not trying to profit, they're trying to do the best job possible according to their mandates. The FDA exists because before they existed there were horrific abuses that caused public outcry, despite the possibility of free market regulatory agencies before that time.

Same response as above basically.
Same response as above. The information costs for making rational decisions in an unregulated marketplace are too high for anyone to make rational decisions, which means the efficiencies of a free market are lessened at best.
Monopoly trusts, are you referring to Standard Oil? If so I'd like you to further elaborate why Standard Oil's "monopoly" was bad for the consumer, when in fact it was other smaller less efficient oil companies that succeeded in bring Standard Oil down on antitrust regulations. The antitrust regulations turned out to be a subsidy for smaller, less efficient, oil companies.
Standard Oil, US Steel, American Tobacco, OPEC. Can you seriously argue that OPEC is better for the oil consumers of the world who don't live in OPEC member nations? Yes, they're 'efficient,' but they also have the ability to raise the price beyond what a free-market supply/demand curve would dictate because no competitors can offer enough supply to combat them.

Explain to me how a "profit-seeking entrant" is going to enter the market and challenge OPEC, and why they haven't done so. (Hint: It's because they make more money by joining OPEC and selling at above-free-market, collusion-based prices)
 

momeNt

Diamond Member
Jan 26, 2011
9,297
350
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Thanks for the false equivalency...

He's advocating for no government which is what Somalia has. People aren't just getting along and creating markets and making a better society for themselves, it's anarchy.

I think government has a role in creating a stable society that benefits everyone. That doesn't mean I think a government like communist Russia's is the answer, there are varying degrees of government intervention.
Somalia is in civil war, with local groups competing for dominance to install a new government. So why are we accrediting groups seeking to establish governments as the fault of having no government? As opposed to the blaming all this on the existence of governments in the first place?
 

fskimospy

Elite Member
Mar 10, 2006
72,160
22,762
136
Somalia is in civil war, with local groups competing for dominance to install a new government. So why are we accrediting groups seeking to establish governments as the fault of having no government? As opposed to the blaming all this on the existence of governments in the first place?
Probably because things like Somalia are exactly what happens when no government exists. It's not like everyone in the world signs onto the governmentless idea with a gentleman's handshake or anything.

Chaos and strongmen are simply the logical consequences of anarchy.
 

momeNt

Diamond Member
Jan 26, 2011
9,297
350
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Good to know urban farmers can feed a centralized population due to what I'm sure will be hyper-efficient privatized urban planning boards to keep traffic and city design in check.
So who gets to just claim the river? Someone who goes and puts a stake in it and says it's his? Does that mean he gets to charge everyone downstream for not selling the "right" he somehow "owns" to pollute in his river? Is he leasing the water that passes through to the cities and farmers downstream? What if it's the ocean? Can I buy rights from someone to dump my nuclear waste in the middle of the Pacific? Who do I negotiate with for that?

How about air pollution? Do you own the wind that blows over your river and your ocean tracts, once we've decided who privately owns what tracts of ocean real estate?
Getting around a private regulatory firm structure would be trivial for a successful company. Options: 1) Make your own regulatory firm and use your profits to celebrate it as the only trustworthy one, smearing all the others (for examples even in our economy, see: tobacco industry, climate change deniers, every holistic medicine company); 2) bribe the regulatory agency; 3) buy them out; 4) simply lie to them, having a fancy nice plant for show and lower standards elsewhere; 5) make profits in areas where people are too poor on average to subscribe to the regulatory agency and/or too busy from working hard to have time to educate themselves on the best regulatory agency, then read detailed articles on each and every consumer product they purchase vs. alternatives (ie everyone alive, no one has that time).

Competition with the FDA will neither increase nor decrease standards because they're not trying to profit, they're trying to do the best job possible according to their mandates. The FDA exists because before they existed there were horrific abuses that caused public outcry, despite the possibility of free market regulatory agencies before that time.

Same response as above. The information costs for making rational decisions in an unregulated marketplace are too high for anyone to make rational decisions, which means the efficiencies of a free market are lessened at best.
Standard Oil, US Steel, American Tobacco, OPEC. Can you seriously argue that OPEC is better for the oil consumers of the world who don't live in OPEC member nations? Yes, they're 'efficient,' but they also have the ability to raise the price beyond what a free-market supply/demand curve would dictate because no competitors can offer enough supply to combat them.

Explain to me how a "profit-seeking entrant" is going to enter the market and challenge OPEC, and why they haven't done so. (Hint: It's because they make more money by joining OPEC and selling at above-free-market, collusion-based prices)

Most of this I can see we'll have to agree to disagree.

I didn't mean that cities, roads, traffic would be planned privately, I meant that people would make decisions on their own based on the services that were available to them through private means. If someone wanted to start a farm a mile west of the last railroad, I'm sure it could be financed, 100 miles? Probably not.

You can protect your land, air, and water. The concept is pretty simple. The alternative is to allow the government to be the sole bargaining agent with cap and trade type measures, which doesn't give everybody a choice in the matter.

There are ways around everything, I don't see your point. You see people selling cherries and apples on the sides of the roads this time of year, no FDA regulation there, for all we know all those apples could have fallen on cow shit.

Too high? Arbitrary, who decides what is too high? You? Why does that have to be subsidized from the profits of other areas of the economy, because it's more important? Who decided that?

OPEC though accounts for less than 50% of worldwide oil production though.... so you are using a failed argument there.
 

Anarchist420

Diamond Member
Feb 13, 2010
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Explain to me how a "profit-seeking entrant" is going to enter the market and challenge OPEC, and why they haven't done so. (Hint: It's because they make more money by joining OPEC and selling at above-free-market, collusion-based prices)
It sounds (to me anyway) that you don't understand what OPEC even stands for. OPEC consists of govts, who sell the natural resources from their lands to the oil companies. The market would be free if lands were not regulated and were not owned by govts neither of which is the case.
 

momeNt

Diamond Member
Jan 26, 2011
9,297
350
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Probably because things like Somalia are exactly what happens when no government exists. It's not like everyone in the world signs onto the governmentless idea with a gentleman's handshake or anything.

Chaos and strongmen are simply the logical consequences of anarchy.
Can this not also be said about government? Generally though governments do refrain from killing their own people, they inflict their pain outside their borders. There are some though that kill their own citizens.

Compare US caused deaths since 1991 and Somali. I wonder who is in the lead.
 

berzerker60

Golden Member
Jul 18, 2012
1,233
1
0
Most of this I can see we'll have to agree to disagree.

I didn't mean that cities, roads, traffic would be planned privately, I meant that people would make decisions on their own based on the services that were available to them through private means. If someone wanted to start a farm a mile west of the last railroad, I'm sure it could be financed, 100 miles? Probably not.

You can protect your land, air, and water. The concept is pretty simple. The alternative is to allow the government to be the sole bargaining agent with cap and trade type measures, which doesn't give everybody a choice in the matter.
The only ultimate 'defense' of your land, air, or water is force. If it's not the government's force, it's someone else's. Good luck suing your way to stopping corporation that's bought up security forces from dumping stuff upriver of what you 'own' without a government. The alternative is, indeed, government, which is why government is the lesser evil (which doesn't have to cap and trade, it can just plain cap, or else tax otherwise-externalities like pollutants and use the revenue for cleanup and recovery).

There are ways around everything, I don't see your point. You see people selling cherries and apples on the sides of the roads this time of year, no FDA regulation there, for all we know all those apples could have fallen on cow shit.
Yes, and there are also FDA regulated apples in the grocery store, giving you an option. If the roadside stands were a significant percentage of the market, it might be worth caring, but they're not. Also, if they started spreading illnesses or disease, you'd better believe they'd get some FDA inspections until that stopped happening. There are crackdowns on direct farm sales of meat and milk around me all the time, and while that's mildly frustrating in some ways, public health sometimes requires individual sacrifices for the much greater public good (such as controlling breakouts of botulism or mad cow).

There are ways around the FDA, but it has way more safeguards than private agencies could. It has no profit motive to allow buyouts/bribery (obviously individuals still do, but not as an institutional motivation); it has the force of government to allow unannounced spot-checks where it wants; it reports to Congress; the media reports on it and Congress; and though weakened by lobbying, it has more authority to resist smear campaigns and misinformation from interested third parties.

Too high? Arbitrary, who decides what is too high? You? Why does that have to be subsidized from the profits of other areas of the economy, because it's more important? Who decided that?
Too high in the sense that no one can possibly have the time to gather, verify, and analyze enough information to make informed, rational decisions about all of their purchases. This is true regardless, but dramatically more so without regulations to provide an assured baseline. Essentially, considering the value of information and the cost of gathering information, the FDA is just a way of achieving an economy of scale on gathering a baseline of this information about consumer goods that directly impact your health.

This isn't just theory - we have a long, long history of patent medicines, quackery, fraud, false advertising, unhealthy foods and medicines, water pollution causing illness, and other ill effects of a free market food and medicine system that (while not ever absolutely cured) were dramatically improved by the Pure Food and Drug Act and its successors. I don't get why the free market didn't create these magical free market regulatory agencies in the real world when they were needed in the US, and they don't exist today in places they'd be useful today like Somalia or the favelas of Rio, but magically they'd spring up in libertopia.

The people decided that the price of buying products without assurances of their actual quality was too high by demanding legislative action. The same as any legislation, in theory, though this one actually did have grassroots campaigns behind it stirred up by exposes of the current state of the food and pharmaceutical industries in the 1900s.

OPEC though accounts for less than 50% of worldwide oil production though.... so you are using a failed argument there.
And yet they have an enormous influence on world oil prices and make more money based on the export amounts they decide than if they all just produced to capacity and sold at resulting market prices. By definition, their extra profit comes at the expense of everyone else. Sure they're not literally a monopoly, but they are a partial monopoly with some of one's market-warping effects.

It sounds (to me anyway) that you don't understand what OPEC even stands for. OPEC consists of govts, who sell the natural resources from their lands to the oil companies. The market would be free if lands were not regulated and were not owned by govts neither of which is the case.
No shit OPEC is countries, but it's also the best known example of a cartel operating today. Many of the member countries also own the oil companies on their lands. They're hardly the only cartel/monopoly (really semi-monopoly, obviously, not a literal one) in history, though. There was only one phone company for decades because no one else wanted to spend the huge money to put wires everywhere just to compete. A few years ago British Airways and their rival Virgin got together and decided to raise fee surcharges together to raise their profits. When there's no entry into a market without extremely high levels of capital, you're not going to get the same free market efficiencies that you see in things like app sales where you can come and go with very little investment.
 

nine9s

Senior member
May 24, 2010
334
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71
Government spending is not constrained by revenue.
Correct. Currency issuer spending is how the monetary base and aggregate demand grow and needs no funding. Taxes reduce both and fund nothing.

Private sector lending does not create net money (an equal liability and asset are create in its lending.) So, the only vertical (non-net) way that money is created is through federal spending - no one else can create the money. So logically the government would have to spend first before it could tax in that currency or there would be no currency to pay the tax. Therefore, logically, the federal government, which is the only currency issuer of our money, is not revenue constrained.
 
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Anarchist420

Diamond Member
Feb 13, 2010
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There was only one phone company for decades because no one else wanted to spend the huge money to put wires everywhere just to compete.
If you're referring to ATT then the govt granted them a monopoly.
No shit OPEC is countries, but it's also the best known example of a cartel operating today. Many of the member countries also own the oil companies on their lands. They're hardly the only cartel/monopoly (really semi-monopoly, obviously, not a literal one) in history, though.
Those are govt-granted "semi monopolies" so I don't see how your theory is being proved right by the examples you issued.:) Govts not part of OPEC could abolish themselves and then that would force OPEC to reduce prices because no one would buy at higher prices.
 

Anarchist420

Diamond Member
Feb 13, 2010
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Private sector lending does not create net money (an equal liability and asset are create in its lending.) So, the only vertical (non-net) way that money is created is through federal spending - no one else can create the money. So logically the government would have to spend first before it could tax in that currency or there would be no currency to pay the tax. Therefore, logically, the federal government, which is the only currency issuer of our money, is not revenue constrained.
In the short term, sure.:) The problem is that govts need to tax if they hope to remain stable by continuing the printing of money... so in the long term, govts are constrained by not collecting enough.
 

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