You're confusing laissez-faire with anarchy. In fact, what you described (minimal government run by the people for the people to make sure that everyone plays fairly and doesn't initiate coercive force, theft or fraud against others) is precisely what the free market people want. There is a world of difference between protecting the free market and interfering with the free market. I don't understand why people are confused by this.
Interfering means taxing, regulating and giving hand-outs (to anyone rich or poor). Protecting means ensuring that those who steal from others, commit fraud or physical violence are held accountable and dealt with by a fair and impartial judiciary, and that no one is given any preference over anyone else.
Free market people don't want a lawless system. In fact, if you listen to Ron Paul he's one of those "tough on crime" conservatives who believe wholeheartedly in the law of the land. What we don't want are taxes, welfare, trade barriers, government-controlled money, mandatory licensing, safety regulations, minimum wages, affirmative action, government-run/managed/supported enterprises and the list goes on. The belief is that these types of interventions end up causing more harm than good and that if, left to it's own vices, the free market would regulate itself. And there is tons of literature available as to how and why.
No Austrian economist has ever said that classes would cease to exist in a free market. That's not the goal. In fact, they have a lot to say on that subject if you would bother to actually read instead of smashing them with arguments that they have spent a lot of time speaking about.
It is actually precisely selfish motivation that makes the system work. All human action is a means to an end. If we were perfectly content we would cease to act. We would cease to be humans. All action is intent on improving personal conditions, even if it is "altruistic" in nature (the idea in such a case is that the suffering of others makes us uneasy). Yes, people will always try to game the system. There will always be people intent on gaining power over others and destroying freedom for their own benefit. That's what government is *supposed* to be there for. To make sure that people play fairly. Classic liberals are not anarchists, they want a small minimal government for the people and by the people who's sole purpose is to protect freedom. As long as government is limited to that scope, the profit motive forces people to satisfy others in order to benefit personally. Classic liberals argue that the larger you allow government to get, and the larger it's scope and jurisdiction becomes, the easier it becomes for special interests to infiltrate it and force the system to become less neutral in favour of their agendas.
I read through your whole post and I could respond point by point, but all of your views stem from the pessimistic attitude that because people are selfish they will ruin the system and that we need a large government to protect us from all of the evils in the world. Classic liberals believe that such a government would cease to protect freedom, instead turning to policies intent on justifying it's own existence and increasing it's power and threat to liberty. Historical observation seems to be on their side in that regard. Classic liberals have written entire books on the subjects of freedom, social justice, inequality, class mobility and so forth, you might want to read them before you use the same old arguments against them that they have already refuted.
Mises talks a lot about mathematical economics in Human Action and the issues involved in trying to come up with formulas and equations to explain how people behave and make decisions.
He admits that historical data is of great use. Prices, after all, are historical data. But they do not tell concretely about the future and how people will make future decisions. They can help us guess. But they can not tell us with any certainty. Economics is not a natural science like physics or chemistry. You cannot apply the scientific method and come up with reproducible results. Economics is a social science.
This is one small piece of what Mises had to say on the subject:
"The deliberations which result in the formulation of a an equation are necessarily of a nonmathematical character. The formulation of the equation is the consummation of our knowledge; it does not directly enlarge our knowledge. Yet, in mechanics the equation can render very important practical services. As there exist constant relations between various mechanical elements and as these relations can be ascertained by experiment, it becomes possible to use equations for the solution of definite technological problems. Our modern industrial civilization is mainly an accomplishment of this utilization of the differential equations of physics. No such constant relations exist, however, between economic elements. The equations formulated by mathematical economics remain a useless piece of mental gymnastics and would remain so even if they were to express much more than they really do.
A sound economic deliberation must never forget these two fundamental principles of the theory of value: First, valuing that results in action always means preferring and setting aside; it never means equivalence of indifference. Second, there is no means of comparing the valuations of different individuals or the valuations of the same individuals at different instants other than by establishing whether or not they arrange the alternatives in question in the same order of preference" - Ludwig Von Mises Human Action p.354.
If you had read my post carefully you would have seen that I was not making the point that inflation was solely a property of paper money. In fact, I have never heard anyone make that claim, ever. Paper money simply puts the control of money into the hands of a central authority, which always abuses it's power and inflates it intentionally. Very rarely ever allowing for deflation. The central authority always claims that the reason for using paper money is to "stabilize" the currency, not allowing for rapid devaluation and panics, but through credit expansion they distort value, encourage malinvestment and cause depressions.
People should allowed to trade whatever they want. Not only is that a simple principle of freedom, but when a currency becomes unstable and there is rapid inflation or deflation the market will adjust accordingly rather than waiting for the government to save them and keep them safe, which always does more harm than good. Not to mention the fact that typically both gold and silver were used as currency before the government stepped in and prohibited it. There is no reason not to have multiple currencies in operation at the same time. We could even have both gold and paper competing (although gold would win out because it has, you know, value). Using multiple currencies allows people to disperse their savings across multiple metaphorical baskets and switch from one currency to another much more quickly in the event of a crisis. They can still do that with paper by keeping savings in reserve currencies, though I don't know why anyone would since most world currencies seem to devalue at roughly the same rate (it would only help if you were anticipating hyperinflation in your country, though personally I would be saving gold in such an event). But there is no reason to forbid people from paying in gold or silver at the grocery store if both parties are open to such a transaction.
That's what governments are *supposed* to be for. You know, to be on everyone's side and to always be neutral. You're right, free markets are theoretical. However, the real paradox is that government intervention to "fix" these problems always makes them worse. So what do we do ?
The only solution that has ever seemed plausible to me is to limit government's power and size in order to limit their ability to interfere with the market. To have lots of checks and balances in the legal system to prevent any group, no matter how powerful, from infiltrating the government for their own advantage. We employ the idea that the government maintains a monopoly on coercive force. Thus when a cartel or small business or an individual initiate force on others for their own gain they face consequences. It's not perfect but I think it would be a lot closer than what we have now.
You do realize that free market does not mean anarchy right ? That violence is still very much illegal and the government still exists to enforce people's rights. That "protecting" the free market by preventing other people from using coercive force to interfere with it themselves is quite different than interference.
"My problem with the whole Von Mises set and philosophy is that if you take the arguments seriously and push them to their logical conclusions, they not only suggest that it's better to refrain from taking wealth away from the wealthiest, it's actually better to funnel it towards them in a massively regressive way. The arguments all go towards supporting the view that the incremental utility to society is always higher when a dollar goes into a wealthy person's hand than a poor person's since the wealthy one is more likely to increase production through the use of that dollar than the poor person is (the poor person will merely use the dollar to increase consumption). "
I urge you to read "Human Action" if you really want to understand the subject, because clearly you don't.
In the truly free market people are simply left to their own free will to decide who to exchange with. It all starts at the beginning. As individuals we need certain things to provide for our survival and comfort. If we work together we produce more of these things. The idea is that through voluntary mutually beneficial exchange we can all get what we want and need. It's important to note the differences between that and socialism. According to Mises the key paradox behind socialism and communism is that in such a system it becomes impossible to determine what the people need, want and how much of it due to the lack of monetary prices. Monetary prices are the only invention that humans have ever come up with to measure subjective value.
So you actually have it backwards, free market does not reward the wealthy. It creates wealthy people by rewarding those who most effectively provide for the needs and wants of the people. A person can only become wealthy if he produces something that satisfies others. The moment he ceases to do so he stops being rewarded by his peers and he stands to lose all of his wealth if he does not invest it in something that will increase the standard of life of his peers.
According to the Austrian school of thought, the reason the markets are creating so much poverty while at the same time making the rich richer at present is because governments, via regulations and monetary control, are giving hand-outs to the wealthy and ensuring that they stay wealthy at the expense of everyone else.
You won't get any arguments from Libertarians claiming that a true free market has ever been put into practice. The only thing every approaching it could be the USA right after independence, but even that wouldn't be entirely accurate since the 2nd president, John Adams, created the first central bank. So in that sense, maybe it is Utopian. But so what ? Are we afraid of ideas now ? I strongly refute Marx and Engels ideas but I listen to everything that they have to say first.
Austrian economics grew out of a battle with socialism during World War II. The simple idea is that if you let people be free they will create their own prosperity. That might be Utopian but it sure sounds like something worth investigating. I don't claim to be an expert economist, but I have actually gone out and read the books published by the Austrian economists and have also read contrary views such as those published by Marx and Keynes in order to ensure that I'm not just absorbing some ideal without getting the whole picture. The Austrian economists make the most sense to me.
According Austrian economists depressions and involuntary unemployment can be explained very convincingly by applying their principles to interventionism. Fiat currency and credit expansion cause the boom / bust cycle which create depressions, and regulations interfere with competition. It's worth reading what they have to say before you condemn them as Utopian dreamers. If I could recommend only one book to anyone it would be "Human Action" by Ludwig Von Mises. If that book does not challenge your views then nothing I will ever say or do could ever convince you to give what I have to say a second thought.
I've never been to the Scandanavian countries. I really wish that I could comment directly. The only thing I can say on the subject is vague: how do you know that your standard of living would not be even higher without those institutions in place ? I will point out that I'm actually Canadian. I live on a border town with the US / Canada and so I have been exposed to both cultures and conditions in both countries. Most of where I'm coming from deals in principle. I am self employed but I am very much middle class (lower middle class is probably more accurate) and I having been exposed to the writings of the Libertarians I can't help but wonder if economic growth and prosperity is being held back by governments. Until you study the subject you can not claim that everything that they say is false. There was a time when all we knew was Serfdom and despotism. Yet it would have been false to claim that Liberalism in some form could not work because it's never been tried. At least socialism and communism have been tried and have proven to fail. They are no longer Utopian dreams, they are failed experiments. I argue very strongly against the notion that laissez-faire has been tried and proven a failure.
"The relative value of currency over a period of time has absolutely nothing to do with the actual standard of living in a country...If we wanted to, we could adopt a tight monetary policy and jack the relative value of our currency through the roof. It'd also spawn massive deflation, and basically end farming and manufacturing in this country."
True, but I'm going to skip over that for just a second because I think I answer that while responding to your other points.
"The idea that a physical anchor (e.g. the gold standard) is going to magically stem inflation or stabilize markets is naive. All you're really doing is screwing with the price of a commodity."
It's not supposed to magically stem inflation. Obviously if new gold is discovered new money enters into circulation. The point is to prevent government from intentionally inflating the currency, distorting value and giving handouts to special interests at the expense of everyone else.
"And if you need to raise money, you increase the amount of your stock in circulation. This part is the important part: you can't do that if your currency is based on a fixed commodity. Lot of Austrian school people would say, "So what?" but credit and credit markets are hugely important to global prosperity."
But you should never need to increase the amount of money in circulation. Credit markets are important but when you increase the supply of money to extend credit you a) literally steal from everyone by inflating the currency, a policy that benefits the people getting the new money first and b) encourage malinvestment by distorting interest rates and, ultimately, value.
Credit markets are important but you do not need paper money in order to lend, in fact that's the very cause of the boom / bust cycle. It also plays the detriminental role of distorting interest and interest is very important. Interest comes from the fact that we value things in the near future vs. the remoter future differently. If you distort interest rates you distort value. Easy credit with low interest rates gets people believing that long term projects that they otherwise would not be able to afford are all of a sudden affordable. Entrepreneurs invest loads of production into projects that they are forced to abandon later on. It creates bubbles which inevitably cause depressions. Paper money does far more harm to the credit markets than good.
"Now obviously, if your country behaves like a Wall Street Investment bank, your money is going to crash. But if your country is well managed and run, then your currency is going to stay valuable."
That's the other side of the argument: principle. There is the famous Mayer Rothschild quote that goes something like "Give me control of a nation's money and I care not who makes her laws". Giving any authority over monetary policy is dangerous in sheer principle. When a country can run the presses it's far too tempting to just print money and spend spend spend. MAYBE if the average citizen understood what money actually is, and understood monetary policy well they would keep their government in check. But that's highly unlikely.
Again, it's not so much that I advocate going to gold. And while I would like to see legal tender backed by something I would much rather the government simply let people trade what they want.
To back to your original point, whenever there is fluctuations in a currency you can never predict exactly what areas will be hit and how hard. It is very possible that farming and agriculture would suffer if the government contracted the money supply, since their costs of living would not go down before they were forced to sell for less. This is just a further argument against government control. In a truly free market without any authority controlling the supply of money changes tend to be much more gradual and easier to anticipate, but even if they're not (ie: a new gold mine is discovered) then people can switch very quickly to an alternative currency if they had to. I'm not saying that suffering does not occur (such as in the panic of 1907), only that government control tends to make suffering longer and more profound.
The question is, should it be up to the federal government to provide funding for municipal roads ?
IMO the municipal government should be providing for these things. If you want to make the argument that the federal government should be in charge of inter-state highways then fine. But my only question was, can someone please give me a good reason why the federal government should be taxing people all over the country to build public roads when the municipal and state governments are supposed to provide for those things.
Also, income tax is usually not used to pay for roads. We have a gas tax for that. This stimulus money is being taken from income tax and debt. This is a huge deviation in typical government behaviour and I think it's important to note and to discuss that.
I know this is in bad taste and I completely expect to get this post modded down, but the moderators are really starting to confuse me here.
Why am I being modded troll ? I'm trying to raise honest arguments against taxation, and at the very least to argue in favour of FAIR taxes. And I'm getting modded troll and flamebait for it. All I'm trying to do is to discuss the issue of taxation, and to point out how I don't feel that this spending project is right. I honestly don't see how this can be interpreted as trolling or flamebait. I feel like I'm being modded down just because the mods don't agree with me.
I'll gladly check the -1 No Karma Bonus on this post, and mod me offtopic if you must, but I think this is a fair question and quite relevant to this discussion.
Sure I can come up with something way worse than gold: paper. The gold standard was considered unstable, and we did have a panic of 1907 that got the public behind paper money, however, comparing the stability of gold to paper is a joke. Paper money has been highly unstable and since it's introduction there has been nothing but inflation.
Money needs to be an economic good in order to be used as money. In other words, it has to have value as used as something *other* than money. Because it is a medium of indirect exchange. In order really understand it's significance it helps to imagine a world with no concept of "money".
Let's say that you're a dairy farmer. You can't stockpile milk indefinitely, and you can't sell enough milk in one day to pay for everything that you need. You need something that you can exchange your milk for that will be small, convenient, easy to save and extremely easy to trade later on. That's how money evolved. People have used rice, salt, pepper, gold, silver etc. Now we're using paper and the only reason it has any value what-so-ever is because the government forces us to use it. Yet every single time the government prints a new dollar it's value diminishes because there is more of it. Eventually the currency becomes worthless. In fact, it's not even proper to call fiat currency money. Originally it was a claim that be redeemed for money, until the government cut that off and forced everyone to trade worthless pieces of paper called banknotes. Why would they do that ? Because having a real asset backing the currency prevents them from running the presses excessively and limits their control and ability to expand their own projects. Only when they run the presses eventually the currency becomes worthless.
The US dollar is worth about 3 or 4 cents compared to what it was in 1913, when the Federal Reserve was created. Giving a central authority, even if it's the government, complete control over the creation of money always results in runaway inflation. Every single country in world history that has tried paper money has run it into the ground. Every single one.
I agree with a lot of Friedman's views but that one issue I STRONGLY disagree with him on. We don't have to use gold, although what I would like to see at the very least is the abolition of laws that prevent people from using gold if they so wish. Government should not be dictating the terms of contracts. I've heard some arguments in favour of legal tender laws (the courts will need to decide what to to be used in civil cases etc. legal tender simplifies that), but Canada doesn't have any law determining what people can use in contracts. No one is forced to trade the Canadian dollar in Canada, even stores don't have to accept the Canadian dollar if they don't want to. People should be able to trade with whatever they want, and legal tender must be backed by *something*.
Because the term "Keynesian economics" is being used so much, we might as well inform those who have no idea what you and I and the rest of us free-market people are talking about.
John Maynard Keynes was a British economist in the early 1900's. He wrote a book called "The General Theory of Employment, Interest and Money" which basically outlined various interventionist policies that the government could employ and what short-term effects they would have on the economy. It was very highly refuted but it gave the government a bunch of easy answers and policies that would ultimately expand government control, yet would be easy to sell to the public. Keynes' work is highly taught by government-subsidized Universities all over the world. Almost anyone taking economics at a University level will be taught "Keynesian Economics".
Anyone who wants to hear both sides of the argument should pick up a copy of General Theory as well as Henry Hazzlitt's "Failure of the New Economics" which is one of the best refutations of Keynes' principles.
Ok, new question. Why are people all over the country paying for something that only people in Redmond are benefiting from ? Why don't the people in Redmond pay for it using municipal funds ?
"Public money" sounds like something straight out of the Communist Manifesto (1848, Karl Marx & Friedrich Engels). The idea behind taxes is that the government takes from the people using coercive force, and we support and continue the process under the belief that we are getting essential services in return. Services that we would not otherwise be capable of providing for ourselves.
Please do educate me as to how this is an essential service that benefits everyone that we would not be able to provide for ourselves.
First off, I didn't realize that the banks were not honoring search warrants. My bad, I should have RTFA'd and I appreciate people informing me and not flaming me. Now I know better.
However, what you are describing is mob-mentality and is what leads us down the road to an authoritarian and totalitarian system. I fear that Bernie Madoff is going to be used by the authority to increase it's grip over people's lives just as they do every other "catastrophe". We need to keep things in perspective. We have due process for a reason: to preserve the individual's freedom. People who screw with the system and disrupt the social order do need to be dealt with, but if we do not limit the authority's power then we all lose, rather than gain.
This is the exact same attitude that lead to blatant violations of civil rights after 9/11. People were saying "And yet... when people get into planes and fly them into buildings killing thousands of innocent people... the high road just doesn't sound all that righteous".
I would rather let a few bad guys get away, and make the ones that we catch compensate society for their loss (by paying back what they stole, not by taking away their freedom... unless we're talking about violent offenders of course) than give big brother the ability, potential and incentive to control us.
Brace yourself, you're in for a real shocker. The USA did not have an income tax prior to 1913 ! *gasp*
The only role I see for government in a free society is preserving freedom. The courts and the police do need to exist in order to deal with those members who would inflict harm upon others, and to act as an arbitrator, when requested, to settle contract disputes. Everything else, you do not need a government to private... and you do not need an income tax to pay for the judiciary.
"I guess you can do without public roads, you'll just build your own?"
All over the US there are private roads and people voluntarily pay tolls to travel them because, brace yourself again, they provide a much more pleasant commute. They deal with traffic congestion immediately, they undertake repairs and maintenance quickly and effectively, without bloated government bureaucracy making repairs and improvements take years and cost tax payers millions of dollars and they do it with their own money.
"You can also pay for your kids school? Health care?"
Government involvement in those two institutions has railroaded both of them straight into the ground. In Canada, for example, there is no law preventing private schools from operating but they're virtually unheard of because everyone is forced to pay taxes to send other people's kids to public school. If government got out of the school system entirely you would have lots of schools opening and competing with each other, forcing prices down. It would be in every school's best interest to increase enrollment and student loans with reasonable, market-determined interest rates would become common for poor students. The level of charity would increase as well. As far as health care is concerned, you should listen to some of what Ron Paul has to say. He was a practicing obstetrician long before he entered politics, and long before medicaid, medicare and government got it's hands on the system. According to him charities and churches would build hospitals and even in the private for-profit hospitals no one was ever turned away because they couldn't afford to pay. It's precisely because we are taxed and regulated so much that these things get so expensive to begin with.
"If you get permanently disabled somehow and can no longer work for a living, I assume you'll have enough savings to last a lifetime?"
Again, if people are allowed to keep what they work for, and if government does not try to interfere with who people trade with and how and why and under what circumstances the economy prospers, people have a lot more personal wealth and charities become much more common. Insurance will also still exist. This goes straight back to medical care. No one will bother to take out insurance plans to cover the occasional doctor's visit, but insurance will still exist to cover extreme unforeseen chronic illness. Employer-provided benefits would also still exist as a way to compete with other businesses for labour and attract employees. As long as it's optional and not mandated by "pro-labour" government regulation it's a boon to society and not a hindrance.
"Oh and can I assume that don't care one bit what happens to those who cannot pay for all this on their own (ie. at least 50% of the population)?"
I urge you to read a bit on economics. Read up on the work of Ludwig Von Mises, F.A Hayek, Murray M. Rothbard and start to ask yourself WHY there is so much poverty. The answer is almost always institutional. During the 1800's the USA economy grew at a tremendous rate. The country was seen as the land of opportunity where you could make it with a bit of hard work. Gradually the government started to expand and intervene with programs sold to the public as a way to help overcome the problems that they perceived in the system. Problems which are all relative. If you compare today's standard of living with that of 1700 England under Serfdom, or even 1930 in Russia and Germany under socialism, you realize just how much the free market
Or anyone who, out of principle, doesn't like the idea of having authorities snooping on their economic lives at their will.
Honestly, "Aryabhata writes in with news that should chill the hearts of evil dictators and tax cheats everywhere" comes across as a little ironic to me, when considering that the mere concept of enabling authorities to snoop on the financial lives of people at it's will is right up the alley of dictatorial and authoritarian. What ever happened to freedom, the right to privacy, search warrants, due process and innocent until proven guilty ?
"My issues here are both the idea that only a monopoly can discourage competition and that monopolies are government-granted.
Large chain stores have pretty much destroyed small independent retailers and grocers - they simply couldn't compete with the lower prices that came with shipping goods in large bulk. You probably regard this as an overall increase in efficiency and all for the good, but I see it as the destruction of the small-time entrepreneur, who now instead of some measure of independence has to man a check-out aisle for his supplanter.
The thing I always loved about New York City was the complete lack of giant, impersonal national chains. Square footage in the city is at such a premium, and the storefronts so small that the national retail chains can't move supplies in bulk and make profit from it. Sure, everything costs an arm and a leg there, but the pay is commensurate, and the strong sense of independent entrepreneurship is refreshing.
We don't see many monopolies in the U.S. due to anti-monopoly regulation, not because of the impracticality or difficulty of establishing a monopoly. The monopolies that exist do so because they are allowed to exist. If existing regulations were removed, we'd see a bit of cannibalization followed by several new emerging monopolies all over the place."
Actually you DO see monopolies all the time in the US. The only thing is, you don't realize that they're monopolies. You have monopolies in education, law, health care, textiles, pharmaceuticals, media / entertainment and so on. Every time the government imposes restrictions on an industry it inadvertently makes competition extremely difficult. In Canada, for example, there are no laws preventing private schools from operating, but since every single individual is taxed to pay for public schools and people can send their kids to public schools for free, private schools are virtually unheard of except for the extremely expensive boarding schools. The FDA, in the USA, imposes strict regulations on testing and marketing of pharmaceuticals. This is sold very easily to the public by claiming that it makes them safer. However, it limits competition, restricts choice, allows the pharmaceutical companies to enter into STABLE cartels (since entry into the industry is extremely rare and unlikely thanks to the government, so the few extremely large corps can collude to limit production, introducing artificial scarcity, and raise prices)... and it hurts everyone.
On the issue of department stores. I'm a hobby chef. So I have something to say about big super markets. I HATE the crap food that gets sold at those big grocers. So I could easily be frightened that these big mega-corp grocery stores are putting the little guys out of business. You know what, they may be taking a significant market-share. But that's because the majority of the people want cheaper food, not better food. As for the hobby-chefs like me, I actually have NO problem finding small grocers and farmers markets that sell me top quality produce. Yes I have to pay a little more but that's the price we pay for disagreeing with everyone else. As long as there is a demand, there will be a supplier. As long as people like you and me hate shopping at Wallmart there will be alternatives. And you know what ? I don't shop at Wallmart. EVER. I don't have a problem finding alternatives. They're more expensive but that's my choice.
The only way a chain can completely "destroy" the competition is to either satisfy every single consumer to such a degree that virtually no one wants to shop elsewhere, or to have a government-supported monopoly. It is fair to say that Wallmart put little chains out of business. But that's because those little chains were selling the exact same product for a higher price. So this is a classic case of a company satisfying the customers more and thus gaining market share. However, if you think that's a scary scenario you are falling into the fallacy of focusing only on pri
"Public corporations have become so large that no attempt at dissuading them from being a societal harm is effective, and the people who run them are protected from accountability for their actions."
This is not a new claim. People have been claiming that large businesses and corporations have made it impossible for new competition to enter the market due to their sheer size for well over 100 years. In some instances a company may be so efficient, may serve the people so well that no other company dares enter the market because there is no perceived way to do it better. However, as long as there is anticipated demand, entrepreneurs will jump at the chance to profit and will use their own capital, and perhaps borrow some as well, to enter the market and compete.
The only thing that can prevent that from happening is a monopoly, which is almost always government-granted. As long as there is no monopoly the people will always keep big business in check because of (as you yourself pointed out): profit for the sake of profit. If you don't provide the people with what they want you hurt your profits.
"Profit for it's own sake leads to the construction of cartels, artificial scarcity, outsourcing of practically everything (not necessarily a bad thing here, but it is bad from an American-only perspective), and cultivation of a "mindless consumer" outlook (as an aside, am I the only one offended when my elected representatives refer to me as a "consumer" rather than as a "citizen"?). I'm not even going to get into the actual criminal actions that prevent free market activities."
That's a lot of points right there. So I'll break it down and deal with each point individually.
1) Profit for the sake of profit. Every human action is driven towards the improvement of personal conditions. There is no such thing as "true altruism" in the sense that people who decide to live entirely for the benefit of others derive some satisfaction, or relieve some felt uneasiness (it might be the fear of God, for example) and so forth. The idea behind the free market is that it is precisely the drive for an improvement in personal conditions that causes us to serve others. We can not accomplish everything by ourselves. We can not produce all of our own clothes while also building our homes and mending our clothes etc. We need to exchange with others in order to improve our own conditions. This is the fundamental principle behind the free market.
2) Construction of cartels. In a truly free market, private collusion (a cartel) is extremely unstable and always short lived because it always takes just one company to decide to break away from the cartel for competitive reasons and the entire alliance falls apart. Furthermore, if companies are colluding to raise prices above the market rate this creates an extremely tempting opportunity for competitors to enter the market, destroying the entire set-up. In our present situation it's always government regulations that prevent new competition from entering industries (usually sold to the people as a way to "keep jobs at home", or "too big to fail" when a restructuring occurs) thus allowing the cartels to remain active.
3) Artificial scarcity can only be achieved through monopoly. In this case the business restricts production in order to raise the prices, achieving what is called a monopoly price. Monopoly prices are problematic and do hurt the consumer, but no so much as people tend to make them out to be. As long as it's not an essential resource there is a maximum price where the company will see it's highest profits. The market price is a reflection of the consumer's combined subjective value. A monopoly price exceeds that subjective value and thus the higher the price goes the less demand there is. If the company raises the price too high it will actually start to lose money because enough people will simply do without the product. In the case of essential resources (the only ones I can think of are local utilities) you need to choose between 2 ev
You're seriously distorting logic. The cotton was the resource that the land-owners, under serfdom, owned. While you may say that the serfs were employing their time in ways that they would otherwise have not were they free, you can not say that they had claim to the cotton. Again, if I go to my neighbhours yard and pick apples from his tree I do not own those apples. For I do not own the land. I have also deprived my neighbhour of his property. Yet by your twist of logic I should charge my neighbour for my labour!
What you are talking about is slavery, which can be interpreted as theft of labour, but that has nothing to do with the cotton itself.
It is true that we value our labour as an economic good. Labour is only time and we clearly value time otherwise interest would not exist. We would gladly pay the same price today for an apple today or an apple in 20 years. We can exchange labour, but we can not expect anyone to value our labour the same as we do. We can not, under all circumstances, expect payment for our any employment of our time. There was has to be an agreement of exchange between two individuals (a contract).
What is going on under copyright is that the institution itself causes us to value specific employments of our labour differently. If all employments of labour and time were valued equally then I should expect payment for responding to your trolls.
What you are saying, on the other hand, is that we should always expect that people will value our labour and want to enter into exchanges for any employment of it. It's a nice fantasy. Unfortunately it has nothing to do with reality.
Are you trolling now, or are you really so narrow-minded ?
Are you actually trying to claim that if the element of people sharing the amateur video were removed that the television commercial would still have been made and they would still enjoy their current success ?
Not to mention the fact that my point was that copyright restricts people's abilities to distribute and thus, in a loose sense, deprives artists of the potential of gaining publicity that they would have otherwise enjoyed. The Internet is an example of people dancing around the institutional barriers. Supporting the theory that copyright hinders success, rather than promote.
""CSS caught an unlikely break when their song "Music Is My Hot Hot Sex" was used in a worldwide television commercial by Apple Inc. for the iPod. An 18-year-old British student, Nick Haley, used the song in a homemade 30-second commercial for the iPod Touch that he created and then posted on the video sharing site YouTube on 11 September 2007.[7] Creative executives from Apple's advertising agency, TBWA\Chiat\Day, saw Haley's creation, contacted him, and enlisted him to remake it as a broadcast version.[8] The spot began airing in the U.S. on 28 October 2007, and later in Japan and Europe. Due to the song's exposure in the US, it hit #63[9][10] on the Billboard Hot 100, becoming the highest charting single by a Brazilian band in the history of the chart. Coincidentally, the same song had been used in a promotion for the competing Zune media player a year prior.[11] In March 2008, the music video for the song amassed over 112 million views on YouTube, making it the most-viewed video on the site, but it has since been removed."
Corporatism is another word for fascism. It's a government/business partnership.
I really want people to realize this, because it's actually just as opposed to free-market and laissez-faire "capitalism" as socialism and communism is. Actually, what lots of people don't realize is that the word "capitalism" has never existed anywhere in the framing of the US legal system. It was a word coined by Karl Marx to vilify the free market economy. The USA was never "capitalist", it was "free".
The free market economy means just that. It has absolutely no bias. It does not play favourites. It does not take from one group and give to another. The people are always in control. Every penny spent in the market is a vote. A company can become extremely huge and "successful" only through satisfying the people's needs. A rich person can easily become poor if he fails to satisfy the people's needs in the market. Only through government protection can a rich person permanently stay rich.
Corporatism / Fascism, on the other hand, is when government starts giving hand-outs to big business at the expense of everyone. It starts with trade barriers and tariffs that are sold to the people by claiming that it will "save jobs, preventing them from going oversees". Antitrust regulations, imposed for the fallacious reason of protecting the free market, are actually favoured by the very companies the people think they're designed to hurt. They actually help them by making it very expensive for new competition to enter the market. Any kind of regulation, when you really examine their effects in detail, almost always do the opposite of what the people were told they would accomplish. Safety regulations that are imposed on all businesses, indiscriminately, favour massive corporations who can easily comply with them, while restricting new businesses who have limited capital etc.
Labour unions also play a role but what is extremely sad is that they do not realize it. They consider themselves exploited proletarians who need to balance the power. In some cases they're right. They are being exploited by a monopoly and have little where else to seek employment. What they do not realize is that they help to further deteriorate the situation by restricting competition in the labour market and further distorting market prices for labour. This creates institutional unemployment, making the situation worse for themselves, but also adding fuel to the cause of government and corporations by giving them an excuse to claim that we need further intervention in the market to stop unemployment.
The last thing that needs to be pointed out is that the single biggest advance in the pursuit of corporatism / fascism in the USA is the Federal Reserve. Contrary to what many laymen believe, the Fed is not government-owned. They are as federal as Federal Express. They are a PRIVATE corporation with special privileges that make it impossible for the government to so much as audit them. By controlling the entire supply of money they cause the boom / bust cycle, promote malinvestment by artificially influencing interest rates, HEAVILY influence government policy (Tim Geithner, the Treasury Secretary, is the former President of the New York Federal Reserve Bank!) and directly cause inflation every time they print more money. Increasing the supply of money lowers the value of the dollar, causing prices to rise. Many people are concerned that all of the government's current spending projects is directly caused by ill advisement on the part of the Fed, and is a plot by the bankers to deliberately cause people to lose confidence in the US dollar in order to establish a new "North American Currency" similar to the Euro. The same thing was done in Germany in 1923 by running the printing presses. It's called hyperinflation. For more info see: http://endthefed.us/
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You're confusing laissez-faire with anarchy. In fact, what you described (minimal government run by the people for the people to make sure that everyone plays fairly and doesn't initiate coercive force, theft or fraud against others) is precisely what the free market people want. There is a world of difference between protecting the free market and interfering with the free market. I don't understand why people are confused by this.
Interfering means taxing, regulating and giving hand-outs (to anyone rich or poor). Protecting means ensuring that those who steal from others, commit fraud or physical violence are held accountable and dealt with by a fair and impartial judiciary, and that no one is given any preference over anyone else.
Free market people don't want a lawless system. In fact, if you listen to Ron Paul he's one of those "tough on crime" conservatives who believe wholeheartedly in the law of the land. What we don't want are taxes, welfare, trade barriers, government-controlled money, mandatory licensing, safety regulations, minimum wages, affirmative action, government-run/managed/supported enterprises and the list goes on. The belief is that these types of interventions end up causing more harm than good and that if, left to it's own vices, the free market would regulate itself. And there is tons of literature available as to how and why.
*sigh*
No Austrian economist has ever said that classes would cease to exist in a free market. That's not the goal. In fact, they have a lot to say on that subject if you would bother to actually read instead of smashing them with arguments that they have spent a lot of time speaking about.
It is actually precisely selfish motivation that makes the system work. All human action is a means to an end. If we were perfectly content we would cease to act. We would cease to be humans. All action is intent on improving personal conditions, even if it is "altruistic" in nature (the idea in such a case is that the suffering of others makes us uneasy). Yes, people will always try to game the system. There will always be people intent on gaining power over others and destroying freedom for their own benefit. That's what government is *supposed* to be there for. To make sure that people play fairly. Classic liberals are not anarchists, they want a small minimal government for the people and by the people who's sole purpose is to protect freedom. As long as government is limited to that scope, the profit motive forces people to satisfy others in order to benefit personally. Classic liberals argue that the larger you allow government to get, and the larger it's scope and jurisdiction becomes, the easier it becomes for special interests to infiltrate it and force the system to become less neutral in favour of their agendas.
I read through your whole post and I could respond point by point, but all of your views stem from the pessimistic attitude that because people are selfish they will ruin the system and that we need a large government to protect us from all of the evils in the world. Classic liberals believe that such a government would cease to protect freedom, instead turning to policies intent on justifying it's own existence and increasing it's power and threat to liberty. Historical observation seems to be on their side in that regard. Classic liberals have written entire books on the subjects of freedom, social justice, inequality, class mobility and so forth, you might want to read them before you use the same old arguments against them that they have already refuted.
Mises talks a lot about mathematical economics in Human Action and the issues involved in trying to come up with formulas and equations to explain how people behave and make decisions.
He admits that historical data is of great use. Prices, after all, are historical data. But they do not tell concretely about the future and how people will make future decisions. They can help us guess. But they can not tell us with any certainty. Economics is not a natural science like physics or chemistry. You cannot apply the scientific method and come up with reproducible results. Economics is a social science.
This is one small piece of what Mises had to say on the subject:
"The deliberations which result in the formulation of a an equation are necessarily of a nonmathematical character. The formulation of the equation is the consummation of our knowledge; it does not directly enlarge our knowledge. Yet, in mechanics the equation can render very important practical services. As there exist constant relations between various mechanical elements and as these relations can be ascertained by experiment, it becomes possible to use equations for the solution of definite technological problems. Our modern industrial civilization is mainly an accomplishment of this utilization of the differential equations of physics. No such constant relations exist, however, between economic elements. The equations formulated by mathematical economics remain a useless piece of mental gymnastics and would remain so even if they were to express much more than they really do.
A sound economic deliberation must never forget these two fundamental principles of the theory of value: First, valuing that results in action always means preferring and setting aside; it never means equivalence of indifference. Second, there is no means of comparing the valuations of different individuals or the valuations of the same individuals at different instants other than by establishing whether or not they arrange the alternatives in question in the same order of preference" - Ludwig Von Mises Human Action p.354.
If you had read my post carefully you would have seen that I was not making the point that inflation was solely a property of paper money. In fact, I have never heard anyone make that claim, ever. Paper money simply puts the control of money into the hands of a central authority, which always abuses it's power and inflates it intentionally. Very rarely ever allowing for deflation. The central authority always claims that the reason for using paper money is to "stabilize" the currency, not allowing for rapid devaluation and panics, but through credit expansion they distort value, encourage malinvestment and cause depressions.
People should allowed to trade whatever they want. Not only is that a simple principle of freedom, but when a currency becomes unstable and there is rapid inflation or deflation the market will adjust accordingly rather than waiting for the government to save them and keep them safe, which always does more harm than good. Not to mention the fact that typically both gold and silver were used as currency before the government stepped in and prohibited it. There is no reason not to have multiple currencies in operation at the same time. We could even have both gold and paper competing (although gold would win out because it has, you know, value). Using multiple currencies allows people to disperse their savings across multiple metaphorical baskets and switch from one currency to another much more quickly in the event of a crisis. They can still do that with paper by keeping savings in reserve currencies, though I don't know why anyone would since most world currencies seem to devalue at roughly the same rate (it would only help if you were anticipating hyperinflation in your country, though personally I would be saving gold in such an event). But there is no reason to forbid people from paying in gold or silver at the grocery store if both parties are open to such a transaction.
That's what governments are *supposed* to be for. You know, to be on everyone's side and to always be neutral. You're right, free markets are theoretical. However, the real paradox is that government intervention to "fix" these problems always makes them worse. So what do we do ?
The only solution that has ever seemed plausible to me is to limit government's power and size in order to limit their ability to interfere with the market. To have lots of checks and balances in the legal system to prevent any group, no matter how powerful, from infiltrating the government for their own advantage. We employ the idea that the government maintains a monopoly on coercive force. Thus when a cartel or small business or an individual initiate force on others for their own gain they face consequences. It's not perfect but I think it would be a lot closer than what we have now.
You do realize that free market does not mean anarchy right ? That violence is still very much illegal and the government still exists to enforce people's rights. That "protecting" the free market by preventing other people from using coercive force to interfere with it themselves is quite different than interference.
"My problem with the whole Von Mises set and philosophy is that if you take the arguments seriously and push them to their logical conclusions, they not only suggest that it's better to refrain from taking wealth away from the wealthiest, it's actually better to funnel it towards them in a massively regressive way. The arguments all go towards supporting the view that the incremental utility to society is always higher when a dollar goes into a wealthy person's hand than a poor person's since the wealthy one is more likely to increase production through the use of that dollar than the poor person is (the poor person will merely use the dollar to increase consumption). "
I urge you to read "Human Action" if you really want to understand the subject, because clearly you don't.
In the truly free market people are simply left to their own free will to decide who to exchange with. It all starts at the beginning. As individuals we need certain things to provide for our survival and comfort. If we work together we produce more of these things. The idea is that through voluntary mutually beneficial exchange we can all get what we want and need. It's important to note the differences between that and socialism. According to Mises the key paradox behind socialism and communism is that in such a system it becomes impossible to determine what the people need, want and how much of it due to the lack of monetary prices. Monetary prices are the only invention that humans have ever come up with to measure subjective value.
So you actually have it backwards, free market does not reward the wealthy. It creates wealthy people by rewarding those who most effectively provide for the needs and wants of the people. A person can only become wealthy if he produces something that satisfies others. The moment he ceases to do so he stops being rewarded by his peers and he stands to lose all of his wealth if he does not invest it in something that will increase the standard of life of his peers.
According to the Austrian school of thought, the reason the markets are creating so much poverty while at the same time making the rich richer at present is because governments, via regulations and monetary control, are giving hand-outs to the wealthy and ensuring that they stay wealthy at the expense of everyone else.
You won't get any arguments from Libertarians claiming that a true free market has ever been put into practice. The only thing every approaching it could be the USA right after independence, but even that wouldn't be entirely accurate since the 2nd president, John Adams, created the first central bank. So in that sense, maybe it is Utopian. But so what ? Are we afraid of ideas now ? I strongly refute Marx and Engels ideas but I listen to everything that they have to say first.
Austrian economics grew out of a battle with socialism during World War II. The simple idea is that if you let people be free they will create their own prosperity. That might be Utopian but it sure sounds like something worth investigating. I don't claim to be an expert economist, but I have actually gone out and read the books published by the Austrian economists and have also read contrary views such as those published by Marx and Keynes in order to ensure that I'm not just absorbing some ideal without getting the whole picture. The Austrian economists make the most sense to me.
According Austrian economists depressions and involuntary unemployment can be explained very convincingly by applying their principles to interventionism. Fiat currency and credit expansion cause the boom / bust cycle which create depressions, and regulations interfere with competition. It's worth reading what they have to say before you condemn them as Utopian dreamers. If I could recommend only one book to anyone it would be "Human Action" by Ludwig Von Mises. If that book does not challenge your views then nothing I will ever say or do could ever convince you to give what I have to say a second thought.
I've never been to the Scandanavian countries. I really wish that I could comment directly. The only thing I can say on the subject is vague: how do you know that your standard of living would not be even higher without those institutions in place ? I will point out that I'm actually Canadian. I live on a border town with the US / Canada and so I have been exposed to both cultures and conditions in both countries. Most of where I'm coming from deals in principle. I am self employed but I am very much middle class (lower middle class is probably more accurate) and I having been exposed to the writings of the Libertarians I can't help but wonder if economic growth and prosperity is being held back by governments. Until you study the subject you can not claim that everything that they say is false. There was a time when all we knew was Serfdom and despotism. Yet it would have been false to claim that Liberalism in some form could not work because it's never been tried. At least socialism and communism have been tried and have proven to fail. They are no longer Utopian dreams, they are failed experiments. I argue very strongly against the notion that laissez-faire has been tried and proven a failure.
"The relative value of currency over a period of time has absolutely nothing to do with the actual standard of living in a country...If we wanted to, we could adopt a tight monetary policy and jack the relative value of our currency through the roof. It'd also spawn massive deflation, and basically end farming and manufacturing in this country."
True, but I'm going to skip over that for just a second because I think I answer that while responding to your other points.
"The idea that a physical anchor (e.g. the gold standard) is going to magically stem inflation or stabilize markets is naive. All you're really doing is screwing with the price of a commodity."
It's not supposed to magically stem inflation. Obviously if new gold is discovered new money enters into circulation. The point is to prevent government from intentionally inflating the currency, distorting value and giving handouts to special interests at the expense of everyone else.
"And if you need to raise money, you increase the amount of your stock in circulation. This part is the important part: you can't do that if your currency is based on a fixed commodity. Lot of Austrian school people would say, "So what?" but credit and credit markets are hugely important to global prosperity."
But you should never need to increase the amount of money in circulation. Credit markets are important but when you increase the supply of money to extend credit you a) literally steal from everyone by inflating the currency, a policy that benefits the people getting the new money first and b) encourage malinvestment by distorting interest rates and, ultimately, value.
Credit markets are important but you do not need paper money in order to lend, in fact that's the very cause of the boom / bust cycle. It also plays the detriminental role of distorting interest and interest is very important. Interest comes from the fact that we value things in the near future vs. the remoter future differently. If you distort interest rates you distort value. Easy credit with low interest rates gets people believing that long term projects that they otherwise would not be able to afford are all of a sudden affordable. Entrepreneurs invest loads of production into projects that they are forced to abandon later on. It creates bubbles which inevitably cause depressions. Paper money does far more harm to the credit markets than good.
"Now obviously, if your country behaves like a Wall Street Investment bank, your money is going to crash. But if your country is well managed and run, then your currency is going to stay valuable."
That's the other side of the argument: principle. There is the famous Mayer Rothschild quote that goes something like "Give me control of a nation's money and I care not who makes her laws". Giving any authority over monetary policy is dangerous in sheer principle. When a country can run the presses it's far too tempting to just print money and spend spend spend. MAYBE if the average citizen understood what money actually is, and understood monetary policy well they would keep their government in check. But that's highly unlikely.
Again, it's not so much that I advocate going to gold. And while I would like to see legal tender backed by something I would much rather the government simply let people trade what they want.
To back to your original point, whenever there is fluctuations in a currency you can never predict exactly what areas will be hit and how hard. It is very possible that farming and agriculture would suffer if the government contracted the money supply, since their costs of living would not go down before they were forced to sell for less. This is just a further argument against government control. In a truly free market without any authority controlling the supply of money changes tend to be much more gradual and easier to anticipate, but even if they're not (ie: a new gold mine is discovered) then people can switch very quickly to an alternative currency if they had to. I'm not saying that suffering does not occur (such as in the panic of 1907), only that government control tends to make suffering longer and more profound.
The question is, should it be up to the federal government to provide funding for municipal roads ?
IMO the municipal government should be providing for these things. If you want to make the argument that the federal government should be in charge of inter-state highways then fine. But my only question was, can someone please give me a good reason why the federal government should be taxing people all over the country to build public roads when the municipal and state governments are supposed to provide for those things.
Also, income tax is usually not used to pay for roads. We have a gas tax for that. This stimulus money is being taken from income tax and debt. This is a huge deviation in typical government behaviour and I think it's important to note and to discuss that.
I know this is in bad taste and I completely expect to get this post modded down, but the moderators are really starting to confuse me here.
Why am I being modded troll ? I'm trying to raise honest arguments against taxation, and at the very least to argue in favour of FAIR taxes. And I'm getting modded troll and flamebait for it. All I'm trying to do is to discuss the issue of taxation, and to point out how I don't feel that this spending project is right. I honestly don't see how this can be interpreted as trolling or flamebait. I feel like I'm being modded down just because the mods don't agree with me.
I'll gladly check the -1 No Karma Bonus on this post, and mod me offtopic if you must, but I think this is a fair question and quite relevant to this discussion.
Sure I can come up with something way worse than gold: paper. The gold standard was considered unstable, and we did have a panic of 1907 that got the public behind paper money, however, comparing the stability of gold to paper is a joke. Paper money has been highly unstable and since it's introduction there has been nothing but inflation.
Money needs to be an economic good in order to be used as money. In other words, it has to have value as used as something *other* than money. Because it is a medium of indirect exchange. In order really understand it's significance it helps to imagine a world with no concept of "money".
Let's say that you're a dairy farmer. You can't stockpile milk indefinitely, and you can't sell enough milk in one day to pay for everything that you need. You need something that you can exchange your milk for that will be small, convenient, easy to save and extremely easy to trade later on. That's how money evolved. People have used rice, salt, pepper, gold, silver etc. Now we're using paper and the only reason it has any value what-so-ever is because the government forces us to use it. Yet every single time the government prints a new dollar it's value diminishes because there is more of it. Eventually the currency becomes worthless. In fact, it's not even proper to call fiat currency money. Originally it was a claim that be redeemed for money, until the government cut that off and forced everyone to trade worthless pieces of paper called banknotes. Why would they do that ? Because having a real asset backing the currency prevents them from running the presses excessively and limits their control and ability to expand their own projects. Only when they run the presses eventually the currency becomes worthless.
The US dollar is worth about 3 or 4 cents compared to what it was in 1913, when the Federal Reserve was created. Giving a central authority, even if it's the government, complete control over the creation of money always results in runaway inflation. Every single country in world history that has tried paper money has run it into the ground. Every single one.
I agree with a lot of Friedman's views but that one issue I STRONGLY disagree with him on. We don't have to use gold, although what I would like to see at the very least is the abolition of laws that prevent people from using gold if they so wish. Government should not be dictating the terms of contracts. I've heard some arguments in favour of legal tender laws (the courts will need to decide what to to be used in civil cases etc. legal tender simplifies that), but Canada doesn't have any law determining what people can use in contracts. No one is forced to trade the Canadian dollar in Canada, even stores don't have to accept the Canadian dollar if they don't want to. People should be able to trade with whatever they want, and legal tender must be backed by *something*.
How about, if you're found guilty you also have to pay back all of the public's expenses used to investigate, prosecute and put you on trial ?
Because the term "Keynesian economics" is being used so much, we might as well inform those who have no idea what you and I and the rest of us free-market people are talking about.
John Maynard Keynes was a British economist in the early 1900's. He wrote a book called "The General Theory of Employment, Interest and Money" which basically outlined various interventionist policies that the government could employ and what short-term effects they would have on the economy. It was very highly refuted but it gave the government a bunch of easy answers and policies that would ultimately expand government control, yet would be easy to sell to the public. Keynes' work is highly taught by government-subsidized Universities all over the world. Almost anyone taking economics at a University level will be taught "Keynesian Economics".
Anyone who wants to hear both sides of the argument should pick up a copy of General Theory as well as Henry Hazzlitt's "Failure of the New Economics" which is one of the best refutations of Keynes' principles.
Ok, new question. Why are people all over the country paying for something that only people in Redmond are benefiting from ? Why don't the people in Redmond pay for it using municipal funds ?
Why ?
"Public money" sounds like something straight out of the Communist Manifesto (1848, Karl Marx & Friedrich Engels). The idea behind taxes is that the government takes from the people using coercive force, and we support and continue the process under the belief that we are getting essential services in return. Services that we would not otherwise be capable of providing for ourselves.
Please do educate me as to how this is an essential service that benefits everyone that we would not be able to provide for ourselves.
First off, I didn't realize that the banks were not honoring search warrants. My bad, I should have RTFA'd and I appreciate people informing me and not flaming me. Now I know better.
However, what you are describing is mob-mentality and is what leads us down the road to an authoritarian and totalitarian system. I fear that Bernie Madoff is going to be used by the authority to increase it's grip over people's lives just as they do every other "catastrophe". We need to keep things in perspective. We have due process for a reason: to preserve the individual's freedom. People who screw with the system and disrupt the social order do need to be dealt with, but if we do not limit the authority's power then we all lose, rather than gain.
This is the exact same attitude that lead to blatant violations of civil rights after 9/11. People were saying "And yet ... when people get into planes and fly them into buildings killing thousands of innocent people ... the high road just doesn't sound all that righteous".
I would rather let a few bad guys get away, and make the ones that we catch compensate society for their loss (by paying back what they stole, not by taking away their freedom ... unless we're talking about violent offenders of course) than give big brother the ability, potential and incentive to control us.
Brace yourself, you're in for a real shocker. The USA did not have an income tax prior to 1913 ! *gasp*
The only role I see for government in a free society is preserving freedom. The courts and the police do need to exist in order to deal with those members who would inflict harm upon others, and to act as an arbitrator, when requested, to settle contract disputes. Everything else, you do not need a government to private... and you do not need an income tax to pay for the judiciary.
"I guess you can do without public roads, you'll just build your own?"
All over the US there are private roads and people voluntarily pay tolls to travel them because, brace yourself again, they provide a much more pleasant commute. They deal with traffic congestion immediately, they undertake repairs and maintenance quickly and effectively, without bloated government bureaucracy making repairs and improvements take years and cost tax payers millions of dollars and they do it with their own money.
"You can also pay for your kids school? Health care?"
Government involvement in those two institutions has railroaded both of them straight into the ground. In Canada, for example, there is no law preventing private schools from operating but they're virtually unheard of because everyone is forced to pay taxes to send other people's kids to public school. If government got out of the school system entirely you would have lots of schools opening and competing with each other, forcing prices down. It would be in every school's best interest to increase enrollment and student loans with reasonable, market-determined interest rates would become common for poor students. The level of charity would increase as well. As far as health care is concerned, you should listen to some of what Ron Paul has to say. He was a practicing obstetrician long before he entered politics, and long before medicaid, medicare and government got it's hands on the system. According to him charities and churches would build hospitals and even in the private for-profit hospitals no one was ever turned away because they couldn't afford to pay. It's precisely because we are taxed and regulated so much that these things get so expensive to begin with.
"If you get permanently disabled somehow and can no longer work for a living, I assume you'll have enough savings to last a lifetime?"
Again, if people are allowed to keep what they work for, and if government does not try to interfere with who people trade with and how and why and under what circumstances the economy prospers, people have a lot more personal wealth and charities become much more common. Insurance will also still exist. This goes straight back to medical care. No one will bother to take out insurance plans to cover the occasional doctor's visit, but insurance will still exist to cover extreme unforeseen chronic illness. Employer-provided benefits would also still exist as a way to compete with other businesses for labour and attract employees. As long as it's optional and not mandated by "pro-labour" government regulation it's a boon to society and not a hindrance.
"Oh and can I assume that don't care one bit what happens to those who cannot pay for all this on their own (ie. at least 50% of the population)?"
I urge you to read a bit on economics. Read up on the work of Ludwig Von Mises, F.A Hayek, Murray M. Rothbard and start to ask yourself WHY there is so much poverty. The answer is almost always institutional. During the 1800's the USA economy grew at a tremendous rate. The country was seen as the land of opportunity where you could make it with a bit of hard work. Gradually the government started to expand and intervene with programs sold to the public as a way to help overcome the problems that they perceived in the system. Problems which are all relative. If you compare today's standard of living with that of 1700 England under Serfdom, or even 1930 in Russia and Germany under socialism, you realize just how much the free market
Or anyone who, out of principle, doesn't like the idea of having authorities snooping on their economic lives at their will.
Honestly, "Aryabhata writes in with news that should chill the hearts of evil dictators and tax cheats everywhere" comes across as a little ironic to me, when considering that the mere concept of enabling authorities to snoop on the financial lives of people at it's will is right up the alley of dictatorial and authoritarian. What ever happened to freedom, the right to privacy, search warrants, due process and innocent until proven guilty ?
"My issues here are both the idea that only a monopoly can discourage competition and that monopolies are government-granted.
Large chain stores have pretty much destroyed small independent retailers and grocers - they simply couldn't compete with the lower prices that came with shipping goods in large bulk. You probably regard this as an overall increase in efficiency and all for the good, but I see it as the destruction of the small-time entrepreneur, who now instead of some measure of independence has to man a check-out aisle for his supplanter.
The thing I always loved about New York City was the complete lack of giant, impersonal national chains. Square footage in the city is at such a premium, and the storefronts so small that the national retail chains can't move supplies in bulk and make profit from it. Sure, everything costs an arm and a leg there, but the pay is commensurate, and the strong sense of independent entrepreneurship is refreshing.
We don't see many monopolies in the U.S. due to anti-monopoly regulation, not because of the impracticality or difficulty of establishing a monopoly. The monopolies that exist do so because they are allowed to exist. If existing regulations were removed, we'd see a bit of cannibalization followed by several new emerging monopolies all over the place."
Actually you DO see monopolies all the time in the US. The only thing is, you don't realize that they're monopolies. You have monopolies in education, law, health care, textiles, pharmaceuticals, media / entertainment and so on. Every time the government imposes restrictions on an industry it inadvertently makes competition extremely difficult. In Canada, for example, there are no laws preventing private schools from operating, but since every single individual is taxed to pay for public schools and people can send their kids to public schools for free, private schools are virtually unheard of except for the extremely expensive boarding schools. The FDA, in the USA, imposes strict regulations on testing and marketing of pharmaceuticals. This is sold very easily to the public by claiming that it makes them safer. However, it limits competition, restricts choice, allows the pharmaceutical companies to enter into STABLE cartels (since entry into the industry is extremely rare and unlikely thanks to the government, so the few extremely large corps can collude to limit production, introducing artificial scarcity, and raise prices) ... and it hurts everyone.
On the issue of department stores. I'm a hobby chef. So I have something to say about big super markets. I HATE the crap food that gets sold at those big grocers. So I could easily be frightened that these big mega-corp grocery stores are putting the little guys out of business. You know what, they may be taking a significant market-share. But that's because the majority of the people want cheaper food, not better food. As for the hobby-chefs like me, I actually have NO problem finding small grocers and farmers markets that sell me top quality produce. Yes I have to pay a little more but that's the price we pay for disagreeing with everyone else. As long as there is a demand, there will be a supplier. As long as people like you and me hate shopping at Wallmart there will be alternatives. And you know what ? I don't shop at Wallmart. EVER. I don't have a problem finding alternatives. They're more expensive but that's my choice.
The only way a chain can completely "destroy" the competition is to either satisfy every single consumer to such a degree that virtually no one wants to shop elsewhere, or to have a government-supported monopoly. It is fair to say that Wallmart put little chains out of business. But that's because those little chains were selling the exact same product for a higher price. So this is a classic case of a company satisfying the customers more and thus gaining market share. However, if you think that's a scary scenario you are falling into the fallacy of focusing only on pri
"Public corporations have become so large that no attempt at dissuading them from being a societal harm is effective, and the people who run them are protected from accountability for their actions."
This is not a new claim. People have been claiming that large businesses and corporations have made it impossible for new competition to enter the market due to their sheer size for well over 100 years. In some instances a company may be so efficient, may serve the people so well that no other company dares enter the market because there is no perceived way to do it better. However, as long as there is anticipated demand, entrepreneurs will jump at the chance to profit and will use their own capital, and perhaps borrow some as well, to enter the market and compete.
The only thing that can prevent that from happening is a monopoly, which is almost always government-granted. As long as there is no monopoly the people will always keep big business in check because of (as you yourself pointed out): profit for the sake of profit. If you don't provide the people with what they want you hurt your profits.
"Profit for it's own sake leads to the construction of cartels, artificial scarcity, outsourcing of practically everything (not necessarily a bad thing here, but it is bad from an American-only perspective), and cultivation of a "mindless consumer" outlook (as an aside, am I the only one offended when my elected representatives refer to me as a "consumer" rather than as a "citizen"?). I'm not even going to get into the actual criminal actions that prevent free market activities."
That's a lot of points right there. So I'll break it down and deal with each point individually.
1) Profit for the sake of profit. Every human action is driven towards the improvement of personal conditions. There is no such thing as "true altruism" in the sense that people who decide to live entirely for the benefit of others derive some satisfaction, or relieve some felt uneasiness (it might be the fear of God, for example) and so forth. The idea behind the free market is that it is precisely the drive for an improvement in personal conditions that causes us to serve others. We can not accomplish everything by ourselves. We can not produce all of our own clothes while also building our homes and mending our clothes etc. We need to exchange with others in order to improve our own conditions. This is the fundamental principle behind the free market.
2) Construction of cartels. In a truly free market, private collusion (a cartel) is extremely unstable and always short lived because it always takes just one company to decide to break away from the cartel for competitive reasons and the entire alliance falls apart. Furthermore, if companies are colluding to raise prices above the market rate this creates an extremely tempting opportunity for competitors to enter the market, destroying the entire set-up. In our present situation it's always government regulations that prevent new competition from entering industries (usually sold to the people as a way to "keep jobs at home", or "too big to fail" when a restructuring occurs) thus allowing the cartels to remain active.
3) Artificial scarcity can only be achieved through monopoly. In this case the business restricts production in order to raise the prices, achieving what is called a monopoly price. Monopoly prices are problematic and do hurt the consumer, but no so much as people tend to make them out to be. As long as it's not an essential resource there is a maximum price where the company will see it's highest profits. The market price is a reflection of the consumer's combined subjective value. A monopoly price exceeds that subjective value and thus the higher the price goes the less demand there is. If the company raises the price too high it will actually start to lose money because enough people will simply do without the product. In the case of essential resources (the only ones I can think of are local utilities) you need to choose between 2 ev
You're seriously distorting logic. The cotton was the resource that the land-owners, under serfdom, owned. While you may say that the serfs were employing their time in ways that they would otherwise have not were they free, you can not say that they had claim to the cotton. Again, if I go to my neighbhours yard and pick apples from his tree I do not own those apples. For I do not own the land. I have also deprived my neighbhour of his property. Yet by your twist of logic I should charge my neighbour for my labour!
What you are talking about is slavery, which can be interpreted as theft of labour, but that has nothing to do with the cotton itself.
It is true that we value our labour as an economic good. Labour is only time and we clearly value time otherwise interest would not exist. We would gladly pay the same price today for an apple today or an apple in 20 years. We can exchange labour, but we can not expect anyone to value our labour the same as we do. We can not, under all circumstances, expect payment for our any employment of our time. There was has to be an agreement of exchange between two individuals (a contract).
What is going on under copyright is that the institution itself causes us to value specific employments of our labour differently. If all employments of labour and time were valued equally then I should expect payment for responding to your trolls.
What you are saying, on the other hand, is that we should always expect that people will value our labour and want to enter into exchanges for any employment of it. It's a nice fantasy. Unfortunately it has nothing to do with reality.
Are you trolling now, or are you really so narrow-minded ?
Are you actually trying to claim that if the element of people sharing the amateur video were removed that the television commercial would still have been made and they would still enjoy their current success ?
Not to mention the fact that my point was that copyright restricts people's abilities to distribute and thus, in a loose sense, deprives artists of the potential of gaining publicity that they would have otherwise enjoyed. The Internet is an example of people dancing around the institutional barriers. Supporting the theory that copyright hinders success, rather than promote.
I don't know about that. Axl Rose is known for jumping off-stage and attacking fans who video tape concerts..
Css is a Brazillian band who got famous this way.
""CSS caught an unlikely break when their song "Music Is My Hot Hot Sex" was used in a worldwide television commercial by Apple Inc. for the iPod. An 18-year-old British student, Nick Haley, used the song in a homemade 30-second commercial for the iPod Touch that he created and then posted on the video sharing site YouTube on 11 September 2007.[7] Creative executives from Apple's advertising agency, TBWA\Chiat\Day, saw Haley's creation, contacted him, and enlisted him to remake it as a broadcast version.[8] The spot began airing in the U.S. on 28 October 2007, and later in Japan and Europe. Due to the song's exposure in the US, it hit #63[9][10] on the Billboard Hot 100, becoming the highest charting single by a Brazilian band in the history of the chart. Coincidentally, the same song had been used in a promotion for the competing Zune media player a year prior.[11] In March 2008, the music video for the song amassed over 112 million views on YouTube, making it the most-viewed video on the site, but it has since been removed."
Corporatism is another word for fascism. It's a government/business partnership.
I really want people to realize this, because it's actually just as opposed to free-market and laissez-faire "capitalism" as socialism and communism is. Actually, what lots of people don't realize is that the word "capitalism" has never existed anywhere in the framing of the US legal system. It was a word coined by Karl Marx to vilify the free market economy. The USA was never "capitalist", it was "free".
The free market economy means just that. It has absolutely no bias. It does not play favourites. It does not take from one group and give to another. The people are always in control. Every penny spent in the market is a vote. A company can become extremely huge and "successful" only through satisfying the people's needs. A rich person can easily become poor if he fails to satisfy the people's needs in the market. Only through government protection can a rich person permanently stay rich.
Corporatism / Fascism, on the other hand, is when government starts giving hand-outs to big business at the expense of everyone. It starts with trade barriers and tariffs that are sold to the people by claiming that it will "save jobs, preventing them from going oversees". Antitrust regulations, imposed for the fallacious reason of protecting the free market, are actually favoured by the very companies the people think they're designed to hurt. They actually help them by making it very expensive for new competition to enter the market. Any kind of regulation, when you really examine their effects in detail, almost always do the opposite of what the people were told they would accomplish. Safety regulations that are imposed on all businesses, indiscriminately, favour massive corporations who can easily comply with them, while restricting new businesses who have limited capital etc.
Labour unions also play a role but what is extremely sad is that they do not realize it. They consider themselves exploited proletarians who need to balance the power. In some cases they're right. They are being exploited by a monopoly and have little where else to seek employment. What they do not realize is that they help to further deteriorate the situation by restricting competition in the labour market and further distorting market prices for labour. This creates institutional unemployment, making the situation worse for themselves, but also adding fuel to the cause of government and corporations by giving them an excuse to claim that we need further intervention in the market to stop unemployment.
The last thing that needs to be pointed out is that the single biggest advance in the pursuit of corporatism / fascism in the USA is the Federal Reserve. Contrary to what many laymen believe, the Fed is not government-owned. They are as federal as Federal Express. They are a PRIVATE corporation with special privileges that make it impossible for the government to so much as audit them. By controlling the entire supply of money they cause the boom / bust cycle, promote malinvestment by artificially influencing interest rates, HEAVILY influence government policy (Tim Geithner, the Treasury Secretary, is the former President of the New York Federal Reserve Bank!) and directly cause inflation every time they print more money. Increasing the supply of money lowers the value of the dollar, causing prices to rise. Many people are concerned that all of the government's current spending projects is directly caused by ill advisement on the part of the Fed, and is a plot by the bankers to deliberately cause people to lose confidence in the US dollar in order to establish a new "North American Currency" similar to the Euro. The same thing was done in Germany in 1923 by running the printing presses. It's called hyperinflation. For more info see: http://endthefed.us/