Dakryn's Batshit Theory of the Week

[Dak]

I see it rather as an orgy of mutual masturbation. I don't deny at all that probably all large and many medium to small business engage in some sort of nonmarket action for the purposes of gain, as the current system is constructed to make it necessary to some degree or other. If you don't engage in regulatory capture or rentseeking or etc etc, your competition will and swamp you in red tape at least. This happens on even the local level of small towns with simple fighting over the control of zoning. Big business has never been in favor of "the market", because - to quote Rockefeller - "Competition is a sin", whether we are speaking of the British East India Company or GE.

Edit: The misunderstanding of SS is common, and epitomizes the confusion between the vastly different positions of "pro-business" and "pro-market".

 

[Einherjar86]

Perhaps you could explain the difference.

 

[Dak]

Well, I could provide a number of articles and examples, but I think a fairly recent and well known outrage distinguishes the difference quite clearly:

Bailing out Wall St was pro-business, letting "TBTF" fail would have been pro-market.

 

[Einherjar86]

That's a good example. How did the government bail out the banks, exactly?

EDIT: rather than belabor the point, I'll ask my question: if a government bailout makes use of taxpayer dollars that can possibly have a detrimental effect on smaller businesses, then isn't a bailout also anti-business?

 

[Dak]

That's a good example. How did the government bail out the banks, exactly?

EDIT: rather than belabor the point, I'll ask my question: if a government bailout makes use of taxpayer dollars that can possibly have a detrimental effect on smaller businesses, then isn't a bailout also anti-business?

Of course. Slapping a policy with a blanket label of pro-business is deceptive in more than one way.

 

[Einherjar86]

But you're the one who appears to insist upon the stark difference between pro-business and pro-market. Are you admitting that your distinction above isn't quite as "vast" as you previously claimed?

 

[Dak]

But you're the one who appears to insist upon the stark difference between pro-business and pro-market. Are you admitting that your distinction above isn't quite as "vast" as you previously claimed?

I don't see how the distinction has been reduced.

 

[Einherjar86]

...if a government bailout makes use of taxpayer dollars that can possibly have a detrimental effect on smaller businesses, then isn't a bailout also anti-business?

Basically, I'm saying that where you tried to identify the government bailout as a "pro-business" policy, it actually hurt many small businesses, which would make it an anti-business policy.

Extrapolating: if this is true in many cases (i.e. if it is true that we can see how purportedly pro-business policies are actually anti-business), then we may venture that none of these policies are actually pro-business, meaning that the distinction you made above is irrelevant, since one whole side of the binary doesn't actually exist.

To go one step further: if none of our examples turn out to be pro-business, then they must all be pro-market (according to your distinction).

 

[Dak]

Basically, I'm saying that where you tried to identify the government bailout as a "pro-business" policy, it actually hurt many small businesses, which would make it an anti-business policy.

Extrapolating: if this is true in many cases (i.e. if it is true that we can see how purportedly pro-business policies are actually anti-business), then we may venture that none of these policies are actually pro-business, meaning that the distinction you made above is irrelevant, since one whole side of the binary doesn't actually exist.

To go one step further: if none of our examples turn out to be pro-business, then they must all be pro-market (according to your distinction).

The point was that being pro-business (or if you wish, being anti-business), is always anti-market. This is vastly different than the common conflation, and it should be obvious businesses are generally pro-"business" (their own), not pro market.

http://www.forbes.com/sites/artcarden/2010/09/20/free-market-doesnt-mean-pro-business/

Here I will invoke my friend Steven Horwitz’s First Law of Political Economy: “no one hates capitalism more than capitalists.” Matt Ridley says it well in his recent book The Rational Optimist, and I agree with him:

I hold no brief for large corporations, whose inefficiencies, complacencies, and anti-competitive tendencies often drive me as crazy as the next man. Like Milton Friedman, I notice that ‘business corporations in general are not defenders of free enterprise. On the contrary, they are one of the chief sources of danger.’ They are addicted to corporate welfare, they love regulations that erect barriers to entry to their small competitors, they yearn for monopoly and they grow flabby and inefficient with age.

 

[Einherjar86]

If one is pro-market, then isn't one anti-business? And, according to your accession to my "wish" above, one can be both pro- and anti-business simultaneously. So, isn't it then possible to be both pro-business and pro-market?

 

[Dak]

If one is pro-market, then isn't one anti-business? And, according to your accession to my "wish" above, one can be both pro- and anti-business simultaneously. So, isn't it then possible to be both pro-business and pro-market?

When speaking of policy, no, one couldn't be both pro market and pro business. Policy that advances one business over another or one industry over another is both pro and anti business, but not pro market. Even policy which advantages all (existing) business is still anti-new-business, which would be anti-market, and this is an extremely common policy set.

 

[Einherjar86]

Doesn't a market need thriving entities in order to exist in the first place? How can one be pro-market if one doesn't favor the rise of business?

 

[Dak]

Doesn't a market need thriving entities in order to exist in the first place? How can one be pro-market if one doesn't favor the rise of business?

So business can only be conducted with the granting of favors?

On a slightly separate note: WWI, Economics, and the Arts:

http://antiwar.com/blog/2014/09/04/squandered-lives-and-snuffed-out-genius/

Tolkien and Mises survived, but so many did not.

 

[Einherjar86]

So business can only be conducted with the granting of favors?

I don't follow. Connect this explicitly to my previous question.

 

[Dak]

I understood your question to assume that "thriving entities"/"the rise of business" depended on favorable policies.

 

[Einherjar86]

Forget policy entirely. You say that it is impossible to be both pro-business and pro-market. I'm confused because I would assume that markets depend on successful businesses in order to thrive.

Long story short, I'm not buying your little binary.

 

[Dak]

It is specifically policy binary we are talking about. How can we exempt/forget policy? To exempt policy is to end the discussion.

 

[Einherjar86]

Fine, then include it. It doesn't change this concern:

You say that it is impossible to be both pro-business and pro-market. I'm confused because I would assume that markets depend on successful businesses in order to thrive.

Long story short, I'm not buying your little binary.

 

[Dak]

My statement was specifically speaking of policy. A pro market stance requires no policy aimed at "business" per se, but rather the standard protection of life and property afford to all (the existence of policy at all assumes at least the "minarchist" state). This is limited, off the top of my head, to physical property theft and vandalism in terms of "capital". IE if you have a store and I spray graffiti dicks on the side, smash your windows, and rob your safe the law is as interested as it would be if I did the same to/at your house. This would be "pro-market policy". "Pro business" policy would be if the town replaced your windows/missing cash and covered the cost of the cover paint job. That would actually be anti-market. The market is not dependent on non-graffitied walls, sparkly windows, nor full safes at any given business. However, the ability of any given business (or person) to offload risk onto customers without choice is extremely damaging to the market. "Pro business" policy is a pseudonym for corporate socialism.

 

[SentinelSlain]

really interesting video for you two