No Coercion

Raise your hand if you’re sick of these politicians and their juvenile tirades against “business.” I know it’s the campaign season and all, but come on! And while I especially cringe when I hear the parasitic rants that the Democrats are so fond of, the formerly pro-economic-freedom Republicans are (with the exception of Ron Paul and sometimes Giuliani) getting in on the action, too. Of course, all these officials are constantly egged on and encouraged in this nonsense by a disturbingly large fraction of the American people, who whine incessantly about all the terrible profits being made by the evil corporations and how there should be minimum and maximum wages, and trade restrictions, and consumer “safety” rules, and progressive taxation, and all manner of other measures that should be taken by the “noble” politicians in an effort to curb the “excesses” of businesses and stand up for the “common good.”

I think what the American people need is a healthy reminder of the actual nature of both business and politics. Following are a couple of appropriate quotes that can help put things in perspective.

From Ayn Rand’s Capitalism: The Unknown Ideal:

What is economic power? It is the power to produce and to trade what one has produced. In a free economy, where no man or group of men can use physical coercion against anyone, economic power can be achieved only by voluntary means: by the voluntary choice and agreement of all those who participate in the process of production and trade. In a free market, all prices, wages, and profits are determined—not by the arbitrary whim of the rich or of the poor, not by anyone’s “greed” or by anyone’s need—but by the law of supply and demand. The mechanism of a free market reflects and sums up all the economic choices and decisions made by all the participants. Men trade their goods or services by mutual consent to mutual advantage, according to their own independent, uncoerced judgment. A man can grow rich only if he is able to offer better values—better products or services, at a lower price—than others are able to offer.

Wealth, in a free market, is achieved by a free, general, “democratic” vote—by the sales and the purchases of every individual who takes part in the economic life of the country. Whenever you buy one product rather than another, you are voting for the success of some manufacturer. And, in this type of voting, every man votes only on those matters which he is qualified to judge: on his own preferences, interests, and needs. No one has the power to decide for others or to substitute his judgment for theirs; no one has the power to appoint himself “the voice of the public” and to leave the public voiceless and disfranchised.

Now let me define the difference between economic power and political power: economic power is exercised by means of a positive, by offering men a reward, an incentive, a payment, a value; political power is exercised by means of a negative, by the threat of punishment, injury, imprisonment, destruction. The businessman’s tool is values; the bureaucrat’s tool is fear.

And here’s a great letter that Don Boudreaux at Cafe Hayek sent to USA Today back during the Christmas season:

Even more predictable than the post-Thanksgiving appearance of shopping-mall Santas is the inability of pundits at this time of year to say or to write “commercialism” without prefixing to it the word “crass” - as we encounter in your pages today in Tom Krattenmaker’s “The real meaning of Christmas.”

I challenge this notion.  Commerce is peaceful. It involves sellers working hard and taking risks to bring to market goods and services that consumers want to buy.  No one forces anyone to do anything; all is voluntary.

What truly is crass is politics - that sorry spectacle of power-seeking ego-maniacs who, when not pronouncing platitudes, are promising to help group A by picking the pockets of group B.  While commerce is honest, politics is duplicitous.  While commerce is peaceful, politics inevitably pits citizen against citizen.  Far more enlightened and ethical behavior is on display during any one day in a shopping mall than the most intrepid observer will find in a century on Pennsylvania Avenue.

And yes, I do realize there are businesses out there doing some really sketchy things that violate the voluntary and value-based nature of commerce. But every single one of those instances is a result of the government getting involved and lending some of its power to those offending businesses. Isn’t it ironic that the people complaining about abuses by businesses are always calling for giving the government more power over business, thus resulting in ever-increasing instances of businesses choosing what seems the most rational course of action and using that government power to their advantage?

What say you, fair readers?

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 I just stumbled across this great piece (15 years old but more relevant than ever) by Hans-Hermann Hoppe (a senior fellow at the Mises Institute) on how the problems with American health care can be solved not by increasing government involvement in health care but by getting government out of health care entirely:

A Four-Step Health-Care Solution 

Here’s the meat of the piece:

1. Eliminate all licensing requirements for medical schools, hospitals, pharmacies, and medical doctors and other health care personnel. Their supply would almost instantly increase, prices would fall, and a greater variety of health care services would appear on the market.

Competing voluntary accreditation agencies would take the place of compulsory government licensing–if health care providers believe that such accreditation would enhance their own reputation, and that their consumers care about reputation, and are willing to pay for it.

Because consumers would no longer be duped into believing that there is such a thing as a “national standard” of health care, they will increase their search costs and make more discriminating health care choices.

2. Eliminate all government restrictions on the production and sale of pharmaceutical products and medical devices. This means no more Food and Drug Administration, which presently hinders innovation and increases costs.

Costs and prices would fall, and a wider variety of better products would reach the market sooner. The market would force consumers to act in accordance with their own–rather than the government’s–risk assessment. And competing drug and device manufacturers and sellers, to safeguard against product liability suits as much as to attract customers, would provide increasingly better product descriptions and guarantees.

3. Deregulate the health insurance industry. Private enterprise can offer insurance against events over whose outcome the insured possesses no control. One cannot insure oneself against suicide or bankruptcy, for example, because it is in one’s own hands to bring these events about.

Because a person’s health, or lack of it, lies increasingly within his own control, many, if not most health risks, are actually uninsurable. “Insurance” against risks whose likelihood an individual can systematically influence falls within that person’s own responsibility.

All insurance, moreover, involves the pooling of individual risks. It implies that insurers pay more to some and less to others. But no one knows in advance, and with certainty, who the “winners” and “losers” will be. “Winners” and “losers” are distributed randomly, and the resulting income redistribution is unsystematic. If “winners” or “losers” could be systematically predicted, “losers” would not want to pool their risk with “winners,” but with other “losers,” because this would lower their insurance costs. I would not want to pool my personal accident risks with those of professional football players, for instance, but exclusively with those of people in circumstances similar to my own, at lower costs.

Because of legal restrictions on the health insurers’ right of refusal–to exclude any individual risk as uninsurable–the present health-insurance system is only partly concerned with insurance. The industry cannot discriminate freely among different groups’ risks.

As a result, health insurers cover a multitude of uninnsurable risks, alongside, and pooled with, genuine insurance risks. They do not discriminate among various groups of people which pose significantly different insurance risks. The industry thus runs a system of income redistribution–benefiting irresponsible actors and high-risk groups at the expense of responsible individuals and low risk groups. Accordingly the industry’s prices are high and ballooning.

To deregulate the industry means to restore it to unrestricted freedom of contract: to allow a health insurer to offer any contract whatsoever, to include or exclude any risk, and to discriminate among any groups of individuals. Uninsurable risks would lose coverage, the variety of insurance policies for the remaining coverage would increase, and price differentials would reflect genuine insurance risks. On average, prices would drastically fall. And the reform would restore individual responsibility in health care.

4. Eliminate all subsidies to the sick or unhealthy. Subsidies create more of whatever is being subsidized. Subsidies for the ill and diseased breed illness and disease, and promote carelessness, indigence, and dependency. If we eliminate them, we would strengthen the will to live healthy lives and to work for a living. In the first instance, that means abolishing Medicare and Medicaid.

Only these four steps, although drastic, will restore a fully free market in medical provision. Until they are adopted, the industry will have serious problems, and so will we, its consumers.

Couldn’t have said it better myself (although I made an attempt with Legalize Health Care).

Hoppe for President of the Galaxy! (Hey, Zaphod had his chance.)

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Not fully on board with my non-coercive, libertarian, anarchist point of view? Interested in seeing if my idea of coercive meshes with yours? Just feel like killing a few minutes?

Then step right up and take my coerciveness quiz:
How Coercive Are You?

A great eye-opener to forward to those not-so-libertarian friends and relatives!

Enjoy!

Update: I have discovered (too late) that gotoquiz.com cuts off answer options after a certain number of characters, so some of the longer answer options are cut off mid-sentence. But hopefully it’s clear where each option is going.

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This story turns my stomach:

Immigration crackdown hits fence builder

Long article, quick summary:

A guy (Mel Kay) owned a very successful fence company (Golden State Fence) in California. About a third of his employees were illegal immigrants, some of whom he actually rehired after they had been arrested on immigration charges. He says he preferred Mexican immigrants (often friends and family referred by current employees) to the typical American citizen blue collar workers in the area, the Mexicans being more trustworthy and likely to stay long term. He paid his employees incredibly well and provided benefits. So, here we have a man and some other men entering into peaceful, voluntary, mutually beneficial agreements in order to engage in a business providing goods and services to others in peaceful, voluntary, mutually beneficial agreements.

Enter the federal government.

The Feds find out that -gasp- this guy was employing people that the government said were ‘illegal.’ Nevermind that every individual has the natural right to enter into voluntary agreements with any other individual–the government (and a great many voters) has decided that particular right can be violated if one party happens to have been born on the wrong side of an imaginary line drawn by politicians and hasn’t gone through the unjust, coercive, expensive and time-consuming ‘official’ channels to become ‘legal.’

Here’s a telling quote regarding the massive operation the government launched to take down this horrible man and his ‘illegal’ fence company:

Shortly after Kay arrived at work at 5 a.m. on Nov. 30, 2005, federal agents stormed his 14-acre headquarters in an industrial part of Riverside, 60 miles east of Los Angeles. In 14 hours, they would fill a 16-foot truck with boxes of documents and computer hard drives.

Simultaneously, a helicopter with a loudspeaker circled over nearly 200 agents who raided the largest of Kay’s 10 branches, in Oceanside, north of San Diego. In all, agents arrested 17 employees at their homes or as they came to load their trucks at 6 a.m.

So basically, this old guy and his son-in-law would have gone to prison if the judge at the sentencing hearing hadn’t looked at the overall picture and had a momentary lapse into the mindset of an almost free human being. Still, the guy ended up with 6 months home confinement and a $5M fine–for daring to enter into peaceful, voluntary transactions with other human beings.

This is your government, people. The government of the so-called freest country on Earth. Yes, that has disturbing implications for the future of human civilization, but what’s most disturbing to me is how many of our fellow Americans (perhaps even some of my readers) not only approve of this kind of coercion and violation of natural rights, but actually protest loudly in favor of such policies and the politicians who support them. For a great many Americans from both of the state-sponsored parties (Democrats and Republicans), support for these kinds of anti-human, wealth-destroying, totalitarian policies is actually the key factor in their decision to support a given candidate.

And to hear it coming from those who consider themselves supporters of limited government is especially confusing and disheartening. To the anti-immigration conservatives and libertarians out there, why is it wrong for the government to ban certain light bulbs and shower heads, but it’s okay for it to launch commando-style assaults on peaceful businesses for the crime of employing hard-working men in voluntary arrangements providing great value to their fellow man–all because they were born on the wrong side of an imaginary line? Somebody please attempt to justify that. I dare you.

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This, my friends, is how basic science could be funded in a free society where government doesn’t confiscate money from Bill to pay for Bob’s research:

Public donates to UW scientist to fund backward-in-time research

I don’t care how important you think your research is–it’s not important enough to steal from me.

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As the Supreme Court considers “the meaning of the Second Amendment for the first time in nearly 70 years,” I’d like to make a quick observation about the amendment’s wording, one which I’m sure others have made before (including, I think, the D.C. Circuit Court of Appeals).

Here’s the exact text: “A well regulated Militia, being necessary to the security of a free State, the right of the people to keep and bear Arms, shall not be infringed.”

Those who would like, for whatever reason, to use government coercion to restrict the natural individual right to bear arms (which is really just a specific case of the general primary natural right to be left alone) often claim that “the people” in this amendment refers to some collective group like the National Guard or other government ‘militia.’

But why do they not make that same argument for the meaning of “the people” in the 1st, 4th, 9th, or 10th Amendments? By their logic, the 1st Amendment, which reads, “…the right of the people peaceably to assemble, and to petition the Government for a redress of grievances,” only in fact protects the right of the government itself to peaceably assemble and petition itself for a redress of grievances! Why the double standard here?

Or what about the 4th Amendment, which reads, “The right of the people to be secure in their persons, houses, papers, and effects, against unreasonable searches and seizures, shall not be violated…” I guess that actually only protects the government from unreasonable search and seizure?

Look, it’s not hard. “The people” in all of those amendments refers to private individuals. The 2nd Amendment spells out the duty of the government to not infringe on the private individual right to own firearms.

And I haven’t even mentioned the oddity that anti-gun folks seem to think that the dependent clause (the part about the militia) has some limiting affect on the independent clause (the part about not infringing the right to bear arms). The framers could have written just about anything for the dependent clause, and the nature of the specified right would not be affected. They could have said, “Pancakes, being necessary for a delicious breakfast, the right of the people to keep and bear Arms, shall not be infringed.” It seems they forget basic grammar when those big scary guns are involved.

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While chatting with some friends tonight, the topic of government studies of artificial sweeteners came up (”Well, of course it did,” you’re saying to yourself). A friend who works at the EPA mentioned some agency folks who had just finished a study apparently racking up more evidence that aspartame (in the form of diet soda in this study, it seems) does such things as cause cancer in lab rats and fails to actually help the rats lose weight as compared to a control group that was drinking regular soda (personally, all the rats I know are more health-conscious than that and tend to avoid soda altogether–something about phosphoric acid).

I asked my friend if he had seen many government-funded studies that came up with good news in their results. You see, it occurs to me that there is a disturbing incentive at work here that makes all government-funded science suspect by default. The money comes either from elected officials directly or from government bureaucracies whose existence and budgets depend on the elected officials.

Now, we know that elected officials (with a very, very few exceptions) depend for their jobs and fame on scaring voters about particular issues and then riding in like the cavalry to solve the terrible problems with new legislation. Are these politicians likely to send money toward scientists whose research finds that, say, aspartame is perfectly safe? Certainly not. Do the scientists know this? Of course. Are there ethical scientists who get the government funding and then proceed to brazenly stick it to their masters by following the science and coming out with results that are not scary? I’m sure there are. But I’ll bet not many of them get repeat business from Uncle Sam (and if they work directly for a government agency, they may not keep their job much longer).

Of course, there’s also a dynamic involved that doesn’t necessarily involve scaring voters into accepting new legislation. Politicians will often also fund research that is popular among the masses, regardless of its actual value. For instance, you see politicians today jumping on whatever the latest ‘green’ technology is that is trendy among the environmental groups (ever notice how easy it is for people to push something when they can use government to force everyone else to help them pay for it?).

I’ve personally seen a lot of government physics research (including some I worked on myself in my pre-libertarian days) that seemed to be driven by socially popular environmental agendas (not to mention plenty of space craft research driven by military-related fear mongering).

Basically, what it comes down to is that research that is likely to lead to an expansion of government power or increased fame and personal power for politicians is much more likely to be funded by your tax dollars than research that isn’t.

Or even more briefly: Government funding of scientific research tends to bias the results in favor of expanded government.

Maybe something to keep in mind when weighing the results of government research.

Am I right? Am I wrong? Have I misread the incentives? Weigh in with your comments, and let me know what you think!

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As you know by now, loyal readers, I want to see Ron Paul win the GOP presidential nomination (of course, if he doesn’t win, I’ll be looking forward to the winner being soundly defeated by whichever aspiring socialist dictator the Democrats nominate–I’ll be voting Libertarian along with everyone else who understands that the GOP and Dems are just two arms of the same overbearing police/nanny state).

But the question keeps coming up, when chatting with folks informally, regarding the fervent support Ron Paul receives from white nationalists (WNs), Nazis, and other assorted inbred racists. It turns out that these people see Ron Paul as agreeing with them on certain key issues.

Ron Paul and the WNs both want to get rid of the Federal Reserve–Paul because of his libertarian philosophy and understanding of Austrian economics, and the WNs because they hate Jews and think the Fed is run by a conspiratorial international Jewish cabal.

Ron Paul and the WNs both want the U.S. to stop giving aid to Israel and basing our foreign policy on what’s best for Israel–Paul because of his libertarian philosophy of neutrality and non-intervention, and the WNs because they hate Jews.

There are also other assorted limited-government issues where the racists agree with Ron Paul, but foreign policy and abolishing the Fed seem to be the big two in which Paul has distinguished himself from the pro-government GOP candidates.

So here are the questions: Should Ron Paul engage in a public effort to disavow the racist and anti-semitic views of his WN supporters? Should he actually return money those people have contributed to him? (The Paul campaign currently asserts that it’s better to keep the money since it will now be used to spread Paul’s message of freedom and it’s less money the racists have to spend on their own nefarious agenda). Is Paul missing out on a big chunk of voters who would support him (and convince others to support him) because of his refusal to speak out against the racists? Are you one of those potential supporters?

Let’s hash this out. Post your thoughts in the comments!

(Jason, I already know your thoughts, but do feel free to share them with my other readers!)

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…of alcohol. Don over at Cafe Hayek reminds us that today is the 74th anniversary of the repeal of the 18th Amendment, which banned alcohol. As we all know, the end of alcohol prohibition increased the safety of booze, stopped the trend of sending otherwise law-abiding citizens to prison (and destroying their families), ended mob warfare over control of the alcohol black market, and generally left us more free from an overbearing police state than we would have been had prohibition continued.

But wait. Something’s wrong. We now have even more dangerous substances on the streets, inner cities wrecked by gang violence and families broken by prison, overcrowed prisons, nonviolent young people being sent to prison where they are converted into violent offenders, and a rapidly expanding police state that routinely beefs up its weaponry and violates our most basic rights in its fanatical crusade to fight prohibited goods. Of course I’m referring to the inane War on Drugs.

Why is it that we learned our lesson when it came to alcohol prohibition, but not when it comes to drug prohibition? What is it about the American psyche that results in a large majority of the public and virtually all elected officials at the state and federal levels favoring the continued prohibition of highly demanded chemical substances? Is it (as an old Army buddy told me) that we feel we’d be encouraging our kids to do drugs if we supported legalizing them? Are we really willing to continue to accept all the society-destroying consequences of drug prohibition in order to make ourselves feel better about the messages we’re sending our kids? I for one am more than willing to have a few more man-to-man conversations with my kids about how to take care of their bodies in exchange for the vast reduction of crime (which is a danger to my family), poverty, and government oppression that would come about from the legalization of drugs. Who’s with me?

(By the way, check out Law Enforcement Against Prohibition (LEAP), and see how the guys in the trenches feel about the Drug War).

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We all learn in Econ 101 that there’s nothing inherently beneficial about buying locally produced goods. That’s not to say that you can’t derive happiness from supporting local growers or that you can’t prefer the taste of a local strawberry to one from the side of the country, but those are just personal preferences that have nothing to do with the actual economics of localization. Nevertheless, there’s a growing trend toward buying local among those who consider themselves environmentally and socially conscious.

Over at Coyote Blog, Warren Meyer talks about some of the significant reasons NOT to push for localization of markets: Sustainability Through Poverty. I especially like his first point:

It doesn’t work.  The total energy used for transport, say of food products, is a small percentage of the total energy used in the total production process.  The energy transportation budget is generally smaller than efficiency gains from scale or from optimizing location.  For example, a wheat farm in Arizona on 50 acres is going to use a lot more energy (and water, and fertilizer, and manpower) than a wheat farm on a thousand acres in North Dakota.

To elaborate on that a little, I would say that people who think they’re “reducing their carbon footprint” by buying local are most likely mistaken. If, as Warren points out above, more energy is used to produce food in a nearby location that’s less suited to such production than another place far away, you’re actually causing MORE carbon dioxide to be released into the atmosphere when you buy local. Increased use of energy is reflected in higher prices. So it probably makes more sense to buy whatever is cheapest if you want to cut back on your carbon dioxide contribution. Just something to think about.

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