The Economics Thread

[viewerfromnihil]

I bet that you will have a great reception from the professors, but don't expect anything from the students - Though I presume that your age and previous experience (military especially) will help with your social status among fellow students, as opposed to mine (being that I'm young, have nothing to vouch for myself in terms of physical achievements, and I'm very skinny (being skinny and goofy looking affects how peers look at you more than you would think).), so you should do better with them then I have been able to. My professors have taken quite a liking to me because of my Libertarian views (From my experience, it seems like both educated Democrats and educated Republicans view Libertarians as overly eager and optimistic people that they can heavily relate to in an idealistic manner), so they are generally excited to see what I have to say in my papers.

 

[Dak]

I agree. I remember being extremely self conscious the first time around, particularly in speech class, because I knew that there was no reason anything about me/what I had to say was any more or less important than anything else (mostly less). In other words, "Who are you?"

I am hoping that age and experience will break down some of those barriers, particularly veteran status.

 

[Einherjar86]

I'm about to start writing a paper on this article.

http://www.mises.org/daily/5978/The-Libertarian-Manifesto-on-Pollution

I'm curious Einherjar, what do you think of the article? The information is a bit dated, but it answered some of the questions that I had pertaining to the topic of environmental protection in a truly Libertarian society. I discussed this topic with a few of my friends, and they became very interested in the concept; however, in class, people were kind of laughing at me when I delved into the topic a bit, but I think that is more related to the fact that, during any class discussion, I always correlate problems in society with government interventionism/coercion. Also, all of my classmates are also freshman at a community college, so many of them think of nothing else but drinking the Kool-Aid.

I'll look at it more closely when I get home, I have to start class in a bit.

I'm about to find myself in the same situation B.O.

I'm going back to school and starting from scratch, and plan to make the subject of my papers and speeches a free market/voluntarist approach. Will see what kind of looks/responses I get lol. I imagine it will be similar to what you are experiencing.

This is exciting!

I can attest to the fact that you may encounter opposition from the student body, and even perhaps from professors as well. When I got my MA, I recall there was one girl in the program who was a libertarian. I specifically remember one moment when another student that was adamantly Marxist was talking about her and shaking his head, and when I asked him to explain why he was upset, he said he "didn't want to talk about it." I think a lot of people were frustrated with her.

That said, I never actually heard anyone argue with her.

Out of curiosity, where are you attending classes?

 

[Dak]

I'm planning right now to do a transfer program at a community college, then probably seek admission to ECU. It's the closest relatively open admin school that offers major/minor in psych and philosophy.

I rarely see Marxists (or "Reaganite conservatives") actually debate anyone, even on the internet. They are too emotionally invested in their position (like most people), and can't get out of the paradigm of capital vs labor.

It's just like when you ask a straight line Republican what exactly is his problem with Ron Paul's foreign policy. You'd be lucky to get anything more specific or intelligent than "it's just loony". Kind of like asking a straight line Democrat what their problem is with his domestic policy.

 

[Dak]

From Innovation to Rent Seeking

 

[Einherjar86]

I'm about to start writing a paper on this article.

http://www.mises.org/daily/5978/The-Libertarian-Manifesto-on-Pollution

I'm curious Einherjar, what do you think of the article? The information is a bit dated, but it answered some of the questions that I had pertaining to the topic of environmental protection in a truly Libertarian society. I discussed this topic with a few of my friends, and they became very interested in the concept; however, in class, people were kind of laughing at me when I delved into the topic a bit, but I think that is more related to the fact that, during any class discussion, I always correlate problems in society with government interventionism/coercion. Also, all of my classmates are also freshman at a community college, so many of them think of nothing else but drinking the Kool-Aid.

I don't have time for a fleshed out response to this, but I'll start off by saying I have a problem with de facto private ownership of natural resources such as lakes or rivers. I understand Rothbard's point about private owners wanting to protect their property, but I have some reservations:

Does the principal owner of the property use it for economic purposes, or is this ownership purely for preservation purposes? The latter seems problematic to me, since any owner of capital can surely by bought by someone whose interests might lie in polluting the resource.

Furthermore, I find it difficult to justify completely private ownership even if the owner uses it for economic purposes. A lake is not something made or built by human hands; it is a natural resource that predates us. Just because a water source might serve as a primary resource for one particular owner doesn't mean it can't serve different purposes for others; would these others be allowed to use the water, even if they don't own it?

Now, could this lake be owned privately, but collectively (a bit of an oxymoron there)? Could it be a kind of cooperative effort, where several different parties use the resource for different economic purposes, and decide to go in and buy it together? This seems to set the stage for even more nuanced and complicated issues, which I don't have time to begin enumerating now.

In short, I think the simple claim that private ownership will solve pollution is more multifaceted than Rothbard realizes. I don't doubt that private owners would want to preserve their resources (as long as it continued to benefit them financially), but I have a problem with how we justify private ownership of such things.

 

[viewerfromnihil]

Please, bear through any bad wordings, long day. I presume the owner would use it for economic resources, anything otherwise wouldn't make very much sense. I see what you're getting at though, and I would agree with you if that were the case, but it seems like an unrealistic possibility if privatization were to happen.

With that same logic, wouldn't the concept of owning land be just as preposterous? I think that it would be possible for the owner of the body of water to not allow anybody else to use their property, but I don't think that it would be economically wise, assuming of course that they bought the property with profits in mind. It would probably be run in a similar, but more efficient manner to what we have now in terms of public use of water resources. You need to have a fishing license to fish in public waters, you typically pay a yearly fee to have parking access to local beaches, there are numerous fees for boating and what not. A private owner would better capitalize on these profits, and could better micromanage the status of his natural resource than a large government bureaucracy.

I assume that it would be possible for a corporate style entity to own a body of water, but I would question whether or not it would be profitable enough for a large corporate structure to preside over. There are a few exceptions to this, however, such as the Gulf of Mexico because of the oil resources. The recent oil spill would probably be a good argument for you to take me up on to rebut the private ownership argument. I don't have the time to delve into the hypotheticals at the moment, so perhaps on another day.

 

[Dak]

The Gulf Oil Spill is an excellent example for privatization.

Oil spills from offshore rigs would most likely occasionally happen regardless of safeguards taken. However, instead of a piddly fine from the governmental agencies, which is merely pocketed by the respective feds, a privatized social structure would give an avenue of recourse for those actually affected (not to mention, would there be off shore drilling in that other world?)

 

[Einherjar86]

With that same logic, wouldn't the concept of owning land be just as preposterous? I think that it would be possible for the owner of the body of water to not allow anybody else to use their property, but I don't think that it would be economically wise, assuming of course that they bought the property with profits in mind. It would probably be run in a similar, but more efficient manner to what we have now in terms of public use of water resources. You need to have a fishing license to fish in public waters, you typically pay a yearly fee to have parking access to local beaches, there are numerous fees for boating and what not. A private owner would better capitalize on these profits, and could better micromanage the status of his natural resource than a large government bureaucracy.

But a fishing permit is something mandated by governmental authority, not a private entity. Furthermore, why should individuals have to pay to use a natural body of water? Why should it be there purely "for the owner," as his/her responsibility to oversee, maintain, and regulate?

I've argued about this with Dak before, and I'm still very wary and uncertain on the nature of "private property." If a private enterprise uses a natural body of water as a power source, or the water serves through some other indirect means in the production of goods/services, why shouldn't other individuals (not associated with that private entity) be allowed to use the water for entirely different purposes? Why can't a village that lives on the other side fish freely, but rather has to pay some kind of service fee to use the water? What right is invoked by the private company: first come, first serve? Size/amount of goods produced? I don't see any justifiable reason why a private entity should be able to wield financial power over a natural resource.

 

[Dak]

But a fishing permit is something mandated by governmental authority, not a private entity. Furthermore, why should individuals have to pay to use a natural body of water? Why should it be there purely "for the owner," as his/her responsibility to oversee, maintain, and regulate?

I've argued about this with Dak before, and I'm still very wary and uncertain on the nature of "private property." If a private enterprise uses a natural body of water as a power source, or the water serves through some other indirect means in the production of goods/services, why shouldn't other individuals (not associated with that private entity) be allowed to use the water for entirely different purposes? Why can't a village that lives on the other side fish freely, but rather has to pay some kind of service fee to use the water? What right is invoked by the private company: first come, first serve? Size/amount of goods produced? I don't see any justifiable reason why a private entity should be able to wield financial power over a natural resource.

The same argument can be swung to bear in the opposite direction: What claim has an arbitrary collective on the same natural body of water? Overwhelming force? Hardly a superior argument, objectively speaking in a philosophical sense.

Yet small bodies of water are owned even now, or at least rented from the state through property taxes, by "land owners", who hold unilateral control over these unless they run afoul of the state. Even with a hunting/fishing license you need permission to hunt/fish on "private property", which may or may not be granted. In some cases there are "hunting clubs", some of which are cooperatives that own tracts of forest expressly for the purpose of hunting by their members only.

So there will be competing interests over use of the earth, but generally speaking the local individual will have a greater interest in the preservation of his surroundings than the distant bureaucrat.

 

[Einherjar86]

But objectively speaking, I'm not talking about a group/entity that restricts another's use of the water. The collective that lives across the way has every right to use the water for their own, regardless of whatever a private company uses it for. These people aren't objecting to some company's use of the body of water, simply the fact that they have to pay some kind of tax or royalty in order to use it.

 

[Dak]

http://en.wikipedia.org/wiki/Tragedy_of_the_commons

Not that you are unfamiliar with this, but it is ironically often used as a justification of creating more "commons".

A fee may or may not be charged, depending on the scope of the ownership/enterprise, or the enterprise of the "visitor". Unlike a state license or fees.

Example: My grandfather lets certain people hunt on his land, and just asks for a chunk of deer in return.

 

[Einherjar86]

But how is that fee justified? Who decides who has private ownership of the lake (I'm going with lake for now)? Is this determined based on who discovers the lake, or who is first to properly settle it? None of these seem, to me, to be convincing arguments for "ownership." Multiple parties might use a resource for equally important, yet discrete, purposes.

 

[Dak]

But how is that fee justified? Who decides who has private ownership of the lake (I'm going with lake for now)? Is this determined based on who discovers the lake, or who is first to properly settle it? None of these seem, to me, to be convincing arguments for "ownership." Multiple parties might use a resource for equally important, yet discrete, purposes.

Well much could depend on the size, location, and other properties of said lake. There really are infinite variables to consider for a overarching view interested in minute details, but not impossible on a case by case basis.

The situation surrounding ownership in all or parts of any particular Great Lake would be quite different than a man made fishing pond, or a secluded bayou.

 

[Einherjar86]

Well, I'm having trouble even imagining a situation where priority is given to the party that arrives there first, or even the party that has the highest level of production. The notion of property, in this case, appears mystified to me. Any justification of private ownership rests on entirely arbitrary conditions.

 

[Dak]

Well, I'm having trouble even imagining a situation where priority is given to the party that arrives there first, or even the party that has the highest level of production. The notion of property, in this case, appears mystified to me. Any justification of private ownership rests on entirely arbitrary conditions.

Well it would need to be fleshed out more than "first arrival", otherwise merely flag planting implies ownership. In my personal opinion, no one can own the earth itself, one can merely make use of it, contrasted with what is created from earth's resources.

So the one currently making use of something should be a beginning of an agreeably arbitrary definition, yet one grounded in pragmatism and the normal reality of our individual necessity. Of course immediately we are faced with defining the limits of what constitutes "making use of".

As I have stated before, the ability to "spread" beyond your "personal piece of ground" is quite hard without offloading the costs of protection, and alternately, what "honest" person would begrudge the homesteader?

 

[Einherjar86]

But if private property, be it land, water, etc. is acquired by one party because of the abundance of one particular resource, how do we justify the landowner expanding his property to include all resources on his already arbitrary plot, whether he uses them or not?

Moreover, what if a landowner designates an acre of land for the planting of one particular crop, but other resources/plants also sprout naturally, with no help from the landowner? How are these his property? How does one justify ownership of resources/produce merely by the segmentation and distribution of land, with recourse only to questionable standards?

 

[Dak]

But if private property, be it land, water, etc. is acquired by one party because of the abundance of one particular resource, how do we justify the landowner expanding his property to include all resources on his already arbitrary plot, whether he uses them or not?

Moreover, what if a landowner designates an acre of land for the planting of one particular crop, but other resources/plants also sprout naturally, with no help from the landowner? How are these his property? How does one justify ownership of resources/produce merely by the segmentation and distribution of land, with recourse only to questionable standards?

Well it doesn't necessarily have to extend to all resources, used or un-used, but in situations, and most likely the majority of situations outside of a taxfunded security apparatus, land-use/occupancy ownership would be the result of literal occupancy, or homesteading. The practicality of the matter of personally provided security would necessitate some level of autonomy. IE, you are awoken at night by someone outside your window who, when challenged, says they are merely there observing the local flora/fauna.

However, it is not impossible to open up multiple usage of the property to others voluntarily. Like someone with an abundance of fruit bearing trees/bushes around their residence may invite friends to come pick since they cannot harvest them all before they rot. The same person may choose to be selfish, but that comes back in the form of lost opportunities in other areas

When you must provide your own security, it also becomes more economical to get along when possible, as opposed to merely phoning for the police, not to mention that in a world without artificial scarcity, incentive for property crime is reduced.

 

[Einherjar86]

I see what you're saying; but by what right does the initial "homesteader" claim to possess the ability to "open up multiple usage of the property to others voluntarily"? Is this just because he happened to be the first to "occupy" the land? What if someone else, who inhabits a different plot of land, has been visiting that site for years, without staking any claim, and harvesting resources?

In my opinion, simply claiming the land as a "homestead" doesn't qualify an individual to wield such power.

 

[Dak]

I see what you're saying; but by what right does the initial "homesteader" claim to possess the ability to "open up multiple usage of the property to others voluntarily"? Is this just because he happened to be the first to "occupy" the land? What if someone else, who inhabits a different plot of land, has been visiting that site for years, without staking any claim, and harvesting resources?

So what? Let's look at it from the other view. No one owns nature (to be defined for the purposes of this example as any theoretically unimproved land) in any way, we just all sort of grab what we can when we can, even possibly in such a way as to not have any conflicts over the resources.

In general, this will lead to immediate depletion in areas, followed by migration and then repetition. Without ownership, the world becomes one big tragedy of the commons. I need to get what I can from Berry Bush X before you come back by, etc. I need to hunt all the animals up before someone else does, etc.

There's no reason to exert labor in land/animal husbandry for someone else to come in and profit off of it at their leisure, or worst case just come in and destroy it for kicks, etc. (which I have no right to defend/prevent as it is not "mine")

In my opinion, simply claiming the land as a "homestead" doesn't qualify an individual to wield such power.

If that very basic, core act of living in a place (excluding nefarious means of acquiring the living space) does not grant such authority, certainly nothing else could objectively be held in higher regard.