No Coercion

A blog exploring the idea of ending coercion and living in a free society.

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Category: Economics

News efficiency mandates

3 April, 2010 (08:12) | Awesomeness, Economics, Government, Regulation | By: Darren

Just wanted to pass along this bit of awesomeness from Don Boudreaux at Cafe Hayek:

Let’s Improve the Efficiency of News Reporting

Here’s a letter to the New York Times:

You argue that a government-mandated higher fuel-efficiency standard “will yield a trifecta of benefits: reduced dependence on foreign oil, fewer greenhouse gas emissions, and consumer savings at the pump” (“Everybody Wins,” April 2).

By this logic, you should also support a government-mandated news-efficiency standard – that is, a requirement that you report and editorialize on any given amount of news using fewer words and less paper than you now use.  This standard would yield a trifecta of benefits: reduced dependence on foreign lumber (we import much from Canada), fewer greenhouse-gas emissions (transporting slimmed-down newspapers would burn less fuel than is burned to transport today’s bulky, news-inefficient papers), and consumer savings at the newsstand (using less ink and less paper will make news-efficient newspapers less pricey than today’s ink and wood-pulp guzzlers).

Everybody wins.

Sincerely,
Donald J. Boudreaux

When you look carefully, likely market failures are all around us, just begging to be corrected by the state.

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Obama’s strange definition of rationing

9 March, 2010 (09:50) | Awesomeness, Obama Administration, Business, Economics, Regulation, Government, Health care | By: Darren

George Mason economist Don Boudreaux writes a brilliant letter (over at Cafe Hayek) to Obama regarding something truly bizarre the Mafioso-in-Chief said about rationing:

8 March 2010

Mr. Barack Obama
President, Executive Branch
United States Government
1600 Pennsylvania Ave., NW
Washington, DC  20500

Dear Mr. Obama:

CBS radio news this morning ran a clip of one of your recent speeches.  In it, you criticize insurance companies because they “ration coverage … according to who can pay and who can’t.”

My first thought was “not exactly; coverage is rationed according to who pays and who doesn’t.”  Ability to pay isn’t the same thing as actually paying, and what insurers care about is the latter.  Many folks – especially young adults – have the ability to pay but choose not to do so.  They get no coverage.

But further pondering of your point leads me to look beyond such nit-picking to see fascinating possibilities.  Not only insurers, but all producers who greedily refuse to supply persons who don’t pay should be set aright.  Now I’m sure that you don’t ration the supply of the books you write according to any criteria as sordid as requiring people actually to pay for them.  But our society is full of people less enlightened than you.

For example, the typical worker rations his labor services according to who pays and who doesn’t.  That must stop.  Oh, and supermarkets!  Every single one rations groceries according to who pays.  Likewise with restaurants, clothing stores, home-builders, furniture makers, even lawyers!  You name it, rationing is done according to who pays.  Indeed, my own county government has been corrupted by this greedy attitude: if I don’t pay my taxes, the sheriff takes my house – effectively booting me out of the county merely because I didn’t pay for its services.

Preposterous!

I look forward to your changing this selfish and unfair system of rationing that for too long now has kept Americans impoverished.

Sincerely,
Donald J. Boudreaux
Professor of Economics
George Mason University
Fairfax, VA 22030

And I love the non-traditional way he addresses the letter, omitting the usual tone of deference.

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The almost Great Depression of 1921

8 March, 2010 (17:44) | Economics, Government | By: Darren

David Friedman discusses the difference between Harding’s reaction to the depression of 1921 and the Hoover-Roosevelt reaction in 1929: A Tale of Two Depressions.

While well known among libertarians and Austrian School economists, 1921 depression and the immediate (and wise) reduction in government spending has been essentially wiped from the mainstream textbooks and history lessons.

Thanks to Destroy the Ring (another great market anarchist blog I’ve recently discovered) for posting the story.

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Put down the gun, and step away from the climate fixes

15 October, 2009 (17:39) | Business, Poverty, Climate Change, Anarchism, Science, Economics, Regulation, Government, Libertarianism, Environment, Liberty | By: Darren

Today is Blog Action Day, organized to try to use coordinated blogging on a single topic to try to affect change. It seems to be focused on statist (i.e. violent) solutions to problems such as poverty, human rights, deforestation, health care, education, etc. The topic this year was declared to be “Climate Change.” Naturally, I’ll be attacking this from a libertarian, voluntaryist, market anarchist angle.

Let’s assume for the sake of argument that the doomsayers are right about the warming of the planet and its degree of anthropogenicity.  My response is, “So what?” Does that give you the right to hold a gun to my head and prevent me from producing, selling, or buying certain types of vehicles, light bulbs, air conditioners, etc.? Does it give you the right to use violence to force me to spend money to modify my production facilities to meet special emissions caps you’ve set? Does it give you the right to forcibly stop me from raising cattle or the right to take money from me and give it to someone else with a spiffy electric car company? The answer to all these questions is NO. Nothing other than my invading someone’s person or property can provide moral justification for him to commit any of those acts of aggression against me. And of course the State therefore also lacks such justification.

Supporters of government action (violence) to stop or reverse global warming often talk about scenarios such as rising sea levels displacing coastal populations, melting polar ice killing off the polar bears, dramatically altered weather patterns turning productive land into desert, etc. What they never seem to consider is that all of this could happen completely independently of any human action whatsoever. If that was the case, surely they wouldn’t be calling for acts of violence against their neighbors. If it was clear that the planet’s temperature was suddenly rising due to natural causes (like volcanic eruptions, solar activity, or the spontaneous appearance of an army of Megan Fox clones), would these pro-government-action folks be clamoring for the use of force to tell their neighbors how to run their businesses or what kind of TV they can have? Of course not. They would recognize that you do not punish or control people as a reaction to natural phenomena over which they had no control.

But how much different is that than the current situation as they describe it? If they’re right about the anthropogenicity of the latest warming trend, all we can say is that billions of people have interacted in the market place in order to meet each others’ needs and earn a living, thus dramatically improving their standards of living while unintentionally altering the atmosphere to the point that temperatures start to rise. This, to me, seems to be a fairly natural process, and the warming was entirely accidental. Does this call for violent solutions, the likes of which you might employ against an evil supervillian who intentionally poured carbon dioxide into the atmosphere to cause destruction? I don’t see how it can.

And the situation becomes even more untenable for the pro-coercion camp when we look at the fact that the climate system is so complex that we really have no idea if their plans to reduce human economic activity (an inhuman “solution” if ever there was one) will do anything at all to stop or reverse the trend. It’s not pleasant to contemplate all the needless misery and death resulting from the foregone improvement in standards of living (especially for the world’s poorest) if temperature trends are not affected by the statist schemes. Layer on top of that the fact that it’s entirely possible that a slightly warmer Earth, though possibly including higher sea levels, could easily result in vast amounts of currently frozen, unproductive land to become arable or otherwise incredibly beneficial to human utility. And regardless of how things turn out, individuals (again, especially the poorest) will be best able to mitigate the downsides and take advantage of the positives if they remain as free as possible to innovate, produce, and exchange on a voluntary basis, free from government coercion.

One final note is that as societies develop economically, they become ever more able to think beyond their daily survival and consider the costs of their actions on the environment. There is widespread pressure from consumers in the developed world for the companies they patronize to use ever more eco-friendly materials and production processes (even Walmart has begun experimenting with green-topping some of its stores). There are even investment funds that put together portfolios of only companies that meet certain standards of ‘greeness’ and energy efficiency (because consumers are demanding it). Advanced market economies naturally produce participants who are attuned to ever more diffuse effects of their actions, and companies will be forced to compete on those bases. There seems less and less need, even by the standards of the pro-government faction, to use force (a necessarily inefficient and thus eco-UNfriendly mechanism) to force companies to ‘be good.’

It seems to me an inescapable conclusion that the only moral position is to oppose the use of the organized, legal violence of the State to combat climate change and just allow the creation of wealth and happiness that flows from the unimpeded interaction of billions of free individuals spontaneously working together to improve their standards of living.

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Public option…for shoes

8 October, 2009 (12:47) | Capitalism, Economics, Government, Health care | By: Darren

I’ve had a change of heart! I think it would be great to have a public option for health insurance! In fact, it makes so much sense, I’m also starting a campaign for a public option for shoes! See, the same reasoning applies. Clearly, shoe manufacturers are unable to adequately provide good shoes at affordable prices because they’re beholden to the ‘almighty dollar.’ They don’t want us to have good shoes that last a long time, because then they would run out of customers. They’re naturally driven by evil market forces to produce shoes that fall apart quickly and then charge exorbitant prices for them so they can make more money. Yep, that’s definitely how it works. There simply aren’t many shoes out there, and the ones that do exist are extremely expensive and don’t even really fully cover our feet. That’s why millions of us are forced to walk around barefoot or in crappy but expensive shoes.

Join me in calling for a public option for shoes!

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Yard sale licensing

15 September, 2009 (08:50) | Business, Capitalism, Taxes, Economics, Libertarianism, Regulation, Government, Liberty | By: Darren

A friend of mine recently commented on one of my libertarian-themed facebook posts, saying that he believed purely free markets only help “businessmen” and harm “labor or the middle and working class.” He wanted to know what examples existed of free market success stories. While there are several issues that could be addressed here, I was a little short on time and limited myself to this response:

As for successes of the free market, pretty much every good or service you make use of in your life is a success story of the free market. The things that make our lives easier, healthier, more enjoyable–these things are the results of a multitude of individuals interacting voluntarily to produce things that people want. These accomplishments are DESPITE government control and regulations, not BECAUSE of them. Think about it on a micro scale. You want to have a yard sale to get rid of a bunch of things you no longer want. You’ll sell them for dirt cheap to people who do want them who would otherwise have to pay a lot more or go without. But imagine if, in order to “protect the consumer,” the government required you to get a state license (costing several hundred dollars and many months of licensing school) before you could hold your yard sale. This would likely prevent you from ever holding your yard sale. Those people who are really hurting for money would have far fewer options for obtaining the things they want, and there would emerge a small group of state-licensed yard sale specialists who would be able to charge much higher prices, thus making use of state violence to obtain a higher-than-market profit at the expense of the financially strapped yard sale customers. This is how government regulation works in EVERY area of the economy. Wealth creation between two parties is maximized when interference with their transaction is minimized. The amount of wealth that government violently destroys or prevents from ever even being created is truly staggering.


Of course, there’s also the fundamental point (made implicitly above) that every transaction, by definition, benefits both parties—otherwise, the transaction simply would not occur. Wealth is created on both sides, because both sides are made better off by the exchange. What every form of government action (taxes, regulations, subsidies, prohibitions, licensing, etc.) does is either outright prevent transactions or distort the decision-making process, resulting either in transactions that would not have occurred in the absence of force (and are thus unproductive) or in the prevention of productive transactions that would have taken place. Either way, there is a destruction of wealth, and society is worse off. Usually, this is compounded by the fact that most government policies actually serve to transfer any wealth that is produced (again, a smaller amount than would be created in the absence of government) to politically favored constituencies, which is both massively unjust and serves to motivate those groups to continue and expand those government policies while everyone from whom that wealth is being transferred fail to launch an effective opposition since each individual policy only transfers a small amount from them.

And just to head off the “OMG we’ll all die if the state doesn’t license doctors and plumbers” contingent out there: relax, we’ll be just fine. State licensing does not “protect” consumers as much as it prevents competition and raises the prices we have to pay for those licensed services. I don’t know about the rest of you, but I don’t hire a service provider of any sort without the knowledge that the quality of their work is sufficient for my liking. And I don’t get that information from the fact that these people have government licenses. I get it from places like Angie’s List, brand identification, references, and general reputation. Just imagine all the ways a truly free market would devise to help us pick out the good doctors and plumbers and home builders. And even if such information is not totally free, think how much more money we’d have without the stifling taxes and wealth destruction of the state.

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Something fishy

15 August, 2009 (17:42) | Economics, Obama Administration, Government, Regulation, Health care, Liberty | By: Darren

By now everyone knows about the infamous White House blog post calling for people to e-mail anything “fishy” they hear or read about the current health care “reform” proposal. It says:

If you get an email or see something on the web about health insurance reform that seems fishy, send it to flag@whitehouse.gov.

Now, I’m sure they would say that they’re not looking for individuals, but rather only the arguments they’re using to oppose the “reform” bill. Nevertheless, you can’t be too careful in this era of disappearing civil liberties, and I want to do the right thing and come forward rather than have someone else turn me in. So here’s an e-mail I just sent to flag@whitehouse.gov:

Dear White House Disinformation Control Center (or whatever you call it),

I would like to turn myself in for spreading what you refer to as “disinformation” about health care reform. You say that “facts are stubborn things,” and I couldn’t agree more. Here are a few that I’m aware of:

1. Every time a human being freely takes a particular action (or opts to not take an action), he does so for one reason–to bring about circumstances for himself that he believes will make him better off in some way than any alternative choices he could have made.

2. When two parties engage in a voluntary exchange, they do so because they both benefit (whether physically, financially, emotionally, or in any other way).

3. Any barriers to such voluntary exchange decrease the wealth or utility that is produced by such an exchange.

4. Health care and health insurance are goods, like any others, that people seek to obtain or provide in order to improve their circumstances.

5. There is no possible way for government to legislate goods into existence.

6. There is no possible way for government to make better decisions for people than they make for themselves when they engage in voluntary exchanges based on actual costs and benefits.

7. Health care costs are rising precisely because of widespread government interference with individuals’ choices regarding how to improve their circumstances.

8. Additional actions by government will comprise even greater barriers to individuals’ ability to obtain low cost, high quality health care.

9. The only thing government can do to improve the state of health care is eliminate the actions it currently takes to hinder voluntary exchanges among free people.

Facts are indeed stubborn things.

Darren O’Connor
XXXX XXXXXXX Drive
Durham, NC XXXXX
NoCoercion.com

 

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Double standard?

12 August, 2009 (09:23) | Obama Administration, Activism, Politics, Economics, Government, Health care | By: Darren

The recent USA Today opinion column by Steny Hoyer and Nancy Pelosi reeks of double standards.

So people who are opposed to any kind of socialist health coverage reforms who attend town hall meetings to express their opposition to their Congressthings are “un-American.” But when people who were disgusted with Bush and GOP policies (like starting wars) protested quite loudly for a good 8 years, it was deemed (correctly, for the most part) by Democratic politicians to be an exercise in the right to free speech.

The charge that these health care protesters are being ‘put up to it’ by the Republican and Libertarian parties is both hypocritical and inaccurate.

First, the anti-Bush protesters were just as much put up to it as these anti-Obama protesters are; that is, they were already strongly opposed to the Bush policies and the Democratic (and sometimes Libertarian) Party helped organize and focus their opposition in the form of protests and speaking out at events held by Republican politicians. What’s the difference?

Second, there is nothing at all wrong with an organization such as a political party organizing its members to ‘ambush’ politicians by showing up in force and demanding they answer tough questions. That’s one of the things for which political parties exist. As economies progress, the division of labor results in increasing specialization in order to use resources ever more efficiently, thus creating wealth. Some people (political party staff) specialize in identifying opportunities to protest a policy they disagree with and organizing people who agree with them to get out there and raise hell. So people who genuinely disagree with a policy strongly enough to protest against it but don’t have time to identify opportunities and organize their friends simply join political parties or interest groups that e-mail them the latest plans for grassroots protests and then head on over after work.

Sounds like Steny and Nancy are just a little too thin-skinned for a taste of what their own people have been doing to the GOP for the past 8 years.

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A lesson from two depressions

3 August, 2009 (23:45) | Capitalism, Politics, Economics, Government, Regulation | By: Darren

After my post yesterday about Harry Reid’s comments, I received some interesting feedback in one particular forum where I linked the post. A couple of people appeared to be amused that I considered the New Deal and the government aggression leading up to it to be destructive. The following was basically my response to them (and it seemed like it would make a good stand-alone blog post):

The Great Depression was the result of the bursting of a government-created inflationary bubble (sound familiar?) combined with government policies pushed first by Republican Herbert Hoover and then by Democrat FDR that prevented prices and wages from falling to their natural market level and prevented unsound investments from being liquidated, which, while being temporarily painful, would have initiated a rapid readjustment of supply and demand and a return to productivity and employment–all without the government programs that plunged the country into permanent (seemingly) socialism and monetary manipulation.

Note that when the same basic initial conditions occurred in the early 1840s, the government did nothing to prevent the necessary price adjustments, and the period 1839-43 experienced a decrease in investment but an INCREASE in real consumption of 21% and in real GNP by 16%, whereas the period 1929-33 (with government controls interfering with the operation of the market) saw a DECREASE in real consumption of 19% and of real GNP by 30% (as discussed by Murray Rothbard in A History of Money and Banking in the United States).

So, the earlier depression came to a swift end when the government did not attempt to ’soften the blow’ or prop up the house of cards, but the Great Depression dragged on for years and caused incredible ruin when the government tried to work its Keynesian voodoo on the economy. Sadly, we appear today to be following the path of oppression and ruin rather than freedom and rebuilding.

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Reid inadvertently states case for abolishing government

3 August, 2009 (11:47) | Capitalism, Politics, Economics, Government, Regulation | By: Darren

Wow. I did a double-take on this one. Senator Harry Reid is claiming that this Congress has “passed more serious, substantive laws than any Congress since President Franklin D. Roosevelt’s first term.” Harry, Harry, Harry…

FDR’s first term (notwithstanding the incredible damage done by the preceding Hoover administration) did immense damage to our country, both deepening and prolonging what should have been a short-lived depression and laying the groundwork for the quasi-socialist authoritarian state the United States has become.

Harry Reid has just admitted (and is apparently proud of) the fact that our current Congress, in conjunction with the FDR-like authoritarian socialist Barack Obama, is on its way to repeat the catastrophic mistakes of that group of irrational miscreants from the 1930s.

Harry, thank you for doing my job for me by making clear the need to abolish the government before it can destroy any more lives.

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