*** The official market and government thread ***

[CoccoBill]

If this was true, crime data would be the opposite of what it is. The data would show places where the law has less reach having more violence, and regions where the law has greater reach having less crime. What we have today is the opposite of this.

You have the causality backwards. Higher law enforcement presence doesn't cause more crime, more crime causes higher law enforcement presence.

[wufwugy]

You have the causality backwards. Higher law enforcement presence doesn't cause more crime, more crime causes higher law enforcement presence.

I never said higher enforcement creates more crime. Tangentially, it probably does by way of criminalizing more activity, but what I said was different.

If enforcement is the mechanism by which crime is reduced, it would show in the data. We would see higher enforcement reduce crime and lower enforcement increase it. But the data doesn't show this.

Neither side of this argument is telling of what's really going on. I made the point as a counter to the false claim that we need state-backed enforcement to keep us safe.

[CoccoBill]

If enforcement is the mechanism by which crime is reduced, it would show in the data. We would see higher enforcement reduce crime and lower enforcement increase it. But the data doesn't show this.

What data are you referring to? You're not saying that where there's less laws (fewer things that are illegal) there's less crime, right, so what are you saying? What's an example of a macro or micro level community, where there's less crime that in its peers due to less regulation or enforcement?

Neither side of this argument is telling of what's really going on. I made the point as a counter to the false claim that we need state-backed enforcement to keep us safe.

If by we you mean people with resources to protect themselves, you're right, but the point is to provide the same for everyone. The people with the means to protect themselves have zero incentive to provide the service to others for free, for crimes that don't directly affect them. A LOT falls under the category not-directly-affecting-me, and it isn't even what actually affects, it's what's perceived to affect.

[Renton]

If by we you mean people with resources to protect themselves, you're right, but the point is to provide the same for everyone. The people with the means to protect themselves have zero incentive to provide the service to others for free, for crimes that don't directly affect them. A LOT falls under the category not-directly-affecting-me, and it isn't even what actually affects, it's what's perceived to affect.

The state police forces are not effectively protecting citizens, yet at extreme financial cost. This egalitarian view of public service is pure fiction. Governments impoverish all people, especially the poor, to cover the costs of the services they provide. The private sector would do police much more cheaply and effectively, because it would have to in order to remain competitive in the market.

The free-rider problem is a problem to be sure, but the unseen of this is that the poor would be much more financially better off in the absence of a nanny state that heavily taxes their income and consumption. Thus, they would be much more well-positioned to afford security. The market for security would likewise attempt to court consumers who can't afford premium police protection. Providers would market their services to the lower-income bracket consumers just like they do with every other service in the economy.

A big problem with most (if not all) public services is that they attempt to guarantee a high standard of quality to all without accounting responsibly for the costs of such provision. There are no prices to provide an expend-or-conserve feedback mechanism so the service inevitably gets squandered by all, quality suffers, and eventually people have to do without it. This can be seen most clearly with universal healthcare systems, but it applies to police forces as well.

[CoccoBill]

The state police forces are not effectively protecting citizens, yet at extreme financial cost. This egalitarian view of public service is pure fiction. Governments impoverish all people, especially the poor, to cover the costs of the services they provide. The private sector would do police much more cheaply and effectively, because it would have to in order to remain competitive in the market.

I don't see any proof of any of this. Are you absolutely certain you're not mistaking implementation flaws in your reference system for inherent flaws in any system? Either way, I didn't say anything about effectiveness, I see safety as a basic inviolable right and I don't see it guaranteed by the market.

The default state of a community is no government. Some sort of central governance model has tended to pop up in every society throughout history, and there's a reason for it. There's a governance model in the nuclear family, not every member has the same say in things. This extends out to family, to neighborhood, to city, region, nation. In every one of them there's a governance hierarchy. You can find one in every company, soccer team and online poker community. Why? Because things go rapidly to hell if there isn't one.

Government is the governance model for a nation-sized blob of people. Saying that things would be better without one and things would just work out is an extraordinary claim, which require extraordinary proof. I haven't seen any yet. Are free markets effective? Sure. Are they just and equal? From what I've seen hell no.

The free-rider problem is a problem to be sure, but the unseen of this is that the poor would be much more financially better off in the absence of a nanny state that heavily taxes their income and consumption. Thus, they would be much more well-positioned to afford security. The market for security would likewise attempt to court consumers who can't afford premium police protection. Providers would market their services to the lower-income bracket consumers just like they do with every other service in the economy.

You're making many assumptions. I'll give you a free market solution to problem P could be a single digit, maybe in some cases 2-digit % cheaper than the public sector equivalent, but I don't think that automatically follows that everyone can suddenly afford everything. Second, you're assuming every possible P makes a valid business case, everything that people need is profitable to produce. Entrepreneurs would fill every single market segment instantaneously with innovative, cost-effective and eco-friendly products and services, it's just that they can't be arsed now because government. I don't buy it.

A big problem with most (if not all) public services is that they attempt to guarantee a high standard of quality to all without accounting responsibly for the costs of such provision. There are no prices to provide an expend-or-conserve feedback mechanism so the service inevitably gets squandered by all, quality suffers, and eventually people have to do without it. This can be seen most clearly with universal healthcare systems, but it applies to police forces as well.

These are clear implementation errors in your reference system, fixed by a simple policy change, aren't they?

[Renton]

I don't see any proof of any of this. Are you absolutely certain you're not mistaking implementation flaws in your reference system for inherent flaws in any system? Either way, I didn't say anything about effectiveness, I see safety as a basic inviolable right and I don't see it guaranteed by the market.

Look at the tax burdens of socialist nations for proof. Look at their inflating currencies. You can't effectively distribute scarce resources which have alternative uses without allowing people to bid for the resources to serve their own subjective needs and desires. It is well-intentioned to speak of inviolable rights, but it cannot be denied that safety can only be provided though the use of scarce resources which have alternative uses. How many police officers is enough to guarantee safety for 300 million people? One million? Two million? Clearly if we had 100 million police officers, then that'd be better than two million. What amount of safety must be guaranteed? What murder rate is acceptable?

States are incapable of making these value judgments. Not because they are stupid or evil or anything like that. Only participants in trade are capable of ascribing value to the resources at their disposal. But states are in a perpetual battle against basic economics. States aren't interested building wealth, they're only interested in staying elected and established.

The default state of a community is no government. Some sort of central governance model has tended to pop up in every society throughout history, and there's a reason for it. There's a governance model in the nuclear family, not every member has the same say in things. This extends out to family, to neighborhood, to city, region, nation. In every one of them there's a governance hierarchy. You can find one in every company, soccer team and online poker community. Why? Because things go rapidly to hell if there isn't one.

Government is the governance model for a nation-sized blob of people. Saying that things would be better without one and things would just work out is an extraordinary claim, which require extraordinary proof. I haven't seen any yet. Are free markets effective? Sure. Are they just and equal? From what I've seen hell no.

The issue isn't the governing, it's the coercion. Corporations have management, but they don't force people to work for them, they don't expropriate people, and they don't incarcerate or kill people who resist. In a stateless society there would leaders and probably would be government-like entities, but it wouldn't be anything like the protection rackets which exist in the present. I am not particularly interested in continuing this line of discussion because I believe most of the police stuff we've been discussing wouldn't require an extremely radical decentralization of power in order to implement.

You're making many assumptions. I'll give you a free market solution to problem P could be a single digit, maybe in some cases 2-digit % cheaper than the public sector equivalent, but I don't think that automatically follows that everyone can suddenly afford everything. Second, you're assuming every possible P makes a valid business case, everything that people need is profitable to produce. Entrepreneurs would fill every single market segment instantaneously with innovative, cost-effective and eco-friendly products and services, it's just that they can't be arsed now because government. I don't buy it.

1) Your numbers are arbitrary, free market solutions could easily be 10 (edited for hyperbole) times cheaper than their state-based predecessors, in time. Markets have a way of increasing productivity exponentially. It's very difficult to know how much governments waste because of the subjective nature of value, though.

2) Everything people value is profitable to produce, otherwise it is not valued is it? Give me an example of one thing that people value that couldn't be produced by the free market. As for government blocking a million and a half profitable business ideas from existing, yes, it absolutely does. Thankfully governments tend to only retard economic development, usually. I consider capitalism to be kind of like the grass that grows through the crack in the asphalt, against all odds. The thing is, all of the principles of markets are in evidence whether a state intervenes or not, states only distort the incentive structure.

These are clear implementation errors in your reference system, fixed by a simple policy change, aren't they?

It is inherent in any system that attempts to provide something very scarce and costly, i.e. healthcare, to all people for free. Yes, you can ration out the care with policy, but as I explained above, you run into major issues with this because you can't know the value of anything without the feedback that comes with prices and bidders. Yes some policies will be more effective than others, but without prices there is little incentive to conserve, and even less incentive to innovate. Standards of service will be arbitrary without feedback from paying consumers, and without competition with other providers. The policy can only be so effective without the incentive structure for efficiency and innovation in place.

[CoccoBill]

Look at the tax burdens of socialist nations for proof. Look at their inflating currencies. You can't effectively distribute scarce resources which have alternative uses without allowing people to bid for the resources to serve their own subjective needs and desires. It is well-intentioned to speak of inviolable rights, but it cannot be denied that safety can only be provided though the use of scarce resources which have alternative uses. How many police officers is enough to guarantee safety for 300 million people? One million? Two million? Clearly if we had 100 million police officers, then that'd be better than two million. What amount of safety must be guaranteed? What murder rate is acceptable?

States are incapable of making these value judgments. Not because they are stupid or evil or anything like that. Only participants in trade are capable of ascribing value to the resources at their disposal. But states are in a perpetual battle against basic economics. States aren't interested building wealth, they're only interested in staying elected and established.

Sorry it took a while to respond, had to digest a couple things for a bit.

How do tax burdens and inflating currencies of socialist nations (which ones do you mean?) prove that we're talking about an inherent, not an implementation flaw? The adequate/sufficient/correct level of police officers I already mentioned in another reply to wuf, it should be based on risk management, continuous evaluation and adjustments. If I had to choose between an efficient government and an egalitarian one, it'd be an easy choice.

The issue isn't the governing, it's the coercion. Corporations have management, but they don't force people to work for them, they don't expropriate people, and they don't incarcerate or kill people who resist. In a stateless society there would leaders and probably would be government-like entities, but it wouldn't be anything like the protection rackets which exist in the present. I am not particularly interested in continuing this line of discussion because I believe most of the police stuff we've been discussing wouldn't require an extremely radical decentralization of power in order to implement.

As long as humans are involved, there will be coercion and condensation of power, unless checks are in place. The only exception again being a benevolent dictatorship I suppose.

1) Your numbers are arbitrary, free market solutions could easily be 10 (edited for hyperbole) times cheaper than their state-based predecessors, in time. Markets have a way of increasing productivity exponentially. It's very difficult to know how much governments waste because of the subjective nature of value, though.

2) Everything people value is profitable to produce, otherwise it is not valued is it? Give me an example of one thing that people value that couldn't be produced by the free market. As for government blocking a million and a half profitable business ideas from existing, yes, it absolutely does. Thankfully governments tend to only retard economic development, usually. I consider capitalism to be kind of like the grass that grows through the crack in the asphalt, against all odds. The thing is, all of the principles of markets are in evidence whether a state intervenes or not, states only distort the incentive structure.

1) Yes they are, but I see no reason why public solutions could not be cheaper also. A government of 1 person is still a government, it doesn't need to be a monstrous behemoth. I'll concede that overall free market solutions come out cheaper, yes.

2) Value assigned on something by people is not tied to its production costs. Nothing guarantees the free market will solve all problems, just the ones with customers with adequate purchasing power. There's e.g. plenty of endemic diseases in africa that no one's rushing to create drugs for, since there's no market potential compared to the research costs.

It is inherent in any system that attempts to provide something very scarce and costly, i.e. healthcare, to all people for free. Yes, you can ration out the care with policy, but as I explained above, you run into major issues with this because you can't know the value of anything without the feedback that comes with prices and bidders. Yes some policies will be more effective than others, but without prices there is little incentive to conserve, and even less incentive to innovate. Standards of service will be arbitrary without feedback from paying consumers, and without competition with other providers. The policy can only be so effective without the incentive structure for efficiency and innovation in place.

I think the optimum solution for healthcare would be somewhere between the all-free-market and all-government solutions. Here for example we have both a flourishing private healthcare system (mostly used by corporations) and a decent public healthcare. Anyone can use the public side, just walk in, pay a fixed fee (say $30 or so), and most tests and procedures are covered by that. If you need a prescription, you get something like 40-100% rebate depending on a few factors. If e.g. queues at your public dentist are full, you get a voucher to use at a private one. Funny thing is, you hear a lot of stories about shitty service at the private clinics and great service at public ones, but these depend a lot on the area you're in.

[wufwugy]

What data are you referring to? You're not saying that where there's less laws (fewer things that are illegal) there's less crime, right, so what are you saying? What's an example of a macro or micro level community, where there's less crime that in its peers due to less regulation or enforcement?

That isn't a causal link I would put that much credence to. Maybe I would if I really wanted to focus on one small aspect, but that's not important here.

Baltimore has way more crime and way more police than Montana. I'm not claiming a causal link, I'm claiming this as a counter to the claim that enforcement reduces crime because if that was true what we would expect to see is Baltimore's crime level look more like Montana and Montana's look more like Baltimore. There are a million problems with trying to apply causality here because there are many more significant factors at play.

If by we you mean people with resources to protect themselves, you're right, but the point is to provide the same for everyone. The people with the means to protect themselves have zero incentive to provide the service to others for free, for crimes that don't directly affect them. A LOT falls under the category not-directly-affecting-me, and it isn't even what actually affects, it's what's perceived to affect.

Most of society already works like this, and it works fantastically. The areas in which it doesn't work so fantastically are ones where the government does a lot. Everything you've said about security can be said about food or housing or software or you name it. The fundamental differences between security and food or housing are minimal to non-existent. So why is it that a free market for food is so effective at providing that need for everybody when it is supposed that only government could do so? Why is it that in all the examples we have of government taking over food industries, vast swaths of populations go hungry?

What we don't want is people providing things "for free" (government does nothing for free anyways, everything it does is at cost, virtually always above market costs). We want the self-interest of competing businesses, because that is what allows consumers to choose the better product. Software is possibly the purest example of a bunch of "greedy" people competing with each other, which has rapidly created an incredible, cheap, productive, previously unfathomable software market.

The default state of a community is no government. Some sort of central governance model has tended to pop up in every society throughout history, and there's a reason for it. There's a governance model in the nuclear family, not every member has the same say in things. This extends out to family, to neighborhood, to city, region, nation. In every one of them there's a governance hierarchy. You can find one in every company, soccer team and online poker community. Why? Because things go rapidly to hell if there isn't one.

This is an argument I've made several times. It is sensible to see the obvious similarities between government and governance structures. The difference is that "government" operates by mandate fueled by taxation. "Governance" in areas like business does not have the same revenue streams. Consumers and workers in markets operate by choice. This is the one, single game changer. Everything about why government doesn't work well yet markets work well can be boiled down to the former receives revenues without competition and the latter receives revenues with competition.

Governance is fantastic. We should have as much competition in governance as we can get. Communities and businesses should use whatever sort of authority structure they think worthy. What we don't want is a state that doesn't have to compete for its revenues. In the marketplace, bad governing structures die and better governing structures are regularly created. In the state, governing structure almost never changes. All it really does is re-entrench old, ineffective governing strategies.

[CoccoBill]

Baltimore has way more crime and way more police than Montana. I'm not claiming a causal link, I'm claiming this as a counter to the claim that enforcement reduces crime because if that was true what we would expect to see is Baltimore's crime level look more like Montana and Montana's look more like Baltimore. There are a million problems with trying to apply causality here because there are many more significant factors at play.

You're contradicting yourself. It's exactly because of these many significant factors that we can't expect crime rates to be equal in different cities depending on one factor alone.

Most of society already works like this, and it works fantastically. The areas in which it doesn't work so fantastically are ones where the government does a lot. Everything you've said about security can be said about food or housing or software or you name it. The fundamental differences between security and food or housing are minimal to non-existent. So why is it that a free market for food is so effective at providing that need for everybody when it is supposed that only government could do so? Why is it that in all the examples we have of government taking over food industries, vast swaths of populations go hungry?

I don't consider software an inviolable basic right, I don't see a reason for the government to step in in any way there. Some socioeconomist might be able to tell how food and security are different economy-wise, I can't. I can't think of any examples of hungry populations due to government intervention on food supply either, except maybe for dictatorships. I think in those cases the interventions probably worked as planned.

This is an argument I've made several times. It is sensible to see the obvious similarities between government and governance structures. The difference is that "government" operates by mandate fueled by taxation. "Governance" in areas like business does not have the same revenue streams. Consumers and workers in markets operate by choice. This is the one, single game changer. Everything about why government doesn't work well yet markets work well can be boiled down to the former receives revenues without competition and the latter receives revenues with competition.

A [business|government] is founded when a group of [entrepreneurs|citizens] decide it's a good idea. All of the [investors|citizens] must chip in. In a [business|government] the [shareholders|citizens] provide funding for the operation and [hire|vote for] a management to operate the [company|government]. [Board of directors|senate/congress/president/whoever] gives the mandate the [business|government] must operate under.

A government is not unlike a business, it just operates on a different scale than most others. Think of taxation as a subscription fee. Market efficiency is utterly and completely irrelevant, if it can't provide the basic necessities for all members of society.

Governance is fantastic. We should have as much competition in governance as we can get. Communities and businesses should use whatever sort of authority structure they think worthy. What we don't want is a state that doesn't have to compete for its revenues. In the marketplace, bad governing structures die and better governing structures are regularly created. In the state, governing structure almost never changes. All it really does is re-entrench old, ineffective governing strategies.

There are 193 sovereign nations on the planet to choose from. There could be better ways, but in representative democracies the competition manifests itself by popular vote. Don't like something? Vote for something else, run for office yourself or find a better government. And yes, I know, this hardly works in most current systems, but that's an argument against current implementations of a representative democracy, not against government.

[wufwugy]

You're contradicting yourself. It's exactly because of these many significant factors that we can't expect crime rates to be equal in different cities depending on one factor alone.

Which is the whole reason why I said it's wrong to claim high enforcement has results of lower crime. I was not proposing a causal link; instead I was saying that a different proposed causal link is not supported by the evidence.

I don't consider software an inviolable basic right, I don't see a reason for the government to step in in any way there.

Are you saying that this means that inviolable rights should be given lip service or that they should be effective? The market position is trying to support the medium by which an "inviolable right" becomes as much of a reality as it can.

Some socioeconomist might be able to tell how food and security are different economy-wise, I can't.

They're not. Economists make very little distinction between how they operate fundamentally.

I can't think of any examples of hungry populations due to government intervention on food supply either, except maybe for dictatorships. I think in those cases the interventions probably worked as planned.

Lots of communist command societies as well. Which also worked as planned. It is unfortunate that our education institutions have whitewashed the Soviet era and how it was about as good of an economic test we could get for central command economics we could ever ask for.

A [business|government] is founded when a group of [entrepreneurs|citizens] decide it's a good idea. All of the [investors|citizens] must chip in. In a [business|government] the [shareholders|citizens] provide funding for the operation and [hire|vote for] a management to operate the [company|government]. [Board of directors|senate/congress/president/whoever] gives the mandate the [business|government] must operate under.

A government is not unlike a business, it just operates on a different scale than most others. Think of taxation as a subscription fee.

Taxation and subscription fees are fundamentally two entirely different things. You're still treating choice and mandates as if they're the same thing.

Market efficiency is utterly and completely irrelevant, if it can't provide the basic necessities for all members of society.

Well, government can't, so I guess that means you're now an anti-statist. Welcome to the club.

More specifically, from what we have seen from markets is that there is no reason whatsoever to believe that it doesn't provide basic necessities for all (more like most, nothing could technically do it for all). Food and shelter are home runs on the issue. Software is a grand slam as far as demonstrating the philosophy goes. Furthermore, it is in the areas where we find increasing government intervention that we find increasing problems, even in sectors that previously were not problematic. Schooling is a fantastic example of this.

There are 193 sovereign nations on the planet to choose from. There could be better ways, but in representative democracies the competition manifests itself by popular vote. Don't like something? Vote for something else, run for office yourself or find a better government. And yes, I know, this hardly works in most current systems, but that's an argument against current implementations of a representative democracy, not against government.

Sorry dude, this isn't a serious argument. It is reasonable to choose from different insurance companies or even to choose relative locations. It is not reasonable whatsoever for people to be expected to leave one tax and regulatory regime for another tax and regulatory regime.

Even then, it if was globally legal to choose which government's laws apply to you, we would see tremendous improvement in the world because of the amount of competing for constituencies different states would have. That improvement would be pretty small compared to a more market sound policy, but it would still be huge relative to where we're at today.

The irony of claiming that voting is a good option is that market choices are off the charts more powerful of a guiding mechanism than bi-yearly democratic voting. Markets are democracy on steroids.

[CoccoBill]

Which is the whole reason why I said it's wrong to claim high enforcement has results of lower crime. I was not proposing a causal link; instead I was saying that a different proposed causal link is not supported by the evidence.

I haven't seen any data for or against, 2 cherry picked US cities hardly qualify as such. Anyway, this discussion started from you claiming such conclusions can be drawn despite the lack of other know factors:

"If this was true, crime data would be the opposite of what it is. The data would show places where the law has less reach having more violence, and regions where the law has greater reach having less crime. What we have today is the opposite of this."

I completely agree it cannot be claimed without evidence that law enforcement reduces crime, despite the obvious intuitive notion, but neither can the opposite. That was my point.

Are you saying that this means that inviolable rights should be given lip service or that they should be effective? The market position is trying to support the medium by which an "inviolable right" becomes as much of a reality as it can.

...for those who can afford it. Yes, perhaps. The adequate level of safety and its effectiveness should be determined using risk management, available resources and risk appetite.

They're not. Economists make very little distinction between how they operate fundamentally.

Ok. I'm not aware of the opinions of every economist out there so I can't argue with that.

Lots of communist command societies as well. Which also worked as planned. It is unfortunate that our education institutions have whitewashed the Soviet era and how it was about as good of an economic test we could get for central command economics we could ever ask for.

I disagree. Communism is/was dictatorship/oligarchy disguised as socialism. I don't expect to see a marxist utopia implemented anywhere anytime soon, but the soviet era was hardly a legit attempt at it.

Taxation and subscription fees are fundamentally two entirely different things. You're still treating choice and mandates as if they're the same thing.

No they're not. Subscription fees and contract terms are mandatory if you want to stay with your provider.

Well, government can't [provide the basic necessities for all members of society], so I guess that means you're now an anti-statist. Welcome to the club.

Which government can't? Universal healthcare, policing, education, housing, those are the norm in all of the Nordics and a bunch of other places. Give me one example where the free market has provided these to everyone, ever?

More specifically, from what we have seen from markets is that there is no reason whatsoever to believe that it doesn't provide basic necessities for all (more like most, nothing could technically do it for all). Food and shelter are home runs on the issue. Software is a grand slam as far as demonstrating the philosophy goes. Furthermore, it is in the areas where we find increasing government intervention that we find increasing problems, even in sectors that previously were not problematic. Schooling is a fantastic example of this.

The US doesn't have universal healthcare. Why are millions signing up for romneycare, when the market has provided great affordable healthcare already to everyone? If only the government stopped snooping that the hospitals are clean and doctors licensed, effectiveness and quality would skyrocket and prices plummet?

Sorry dude, this isn't a serious argument. It is reasonable to choose from different insurance companies or even to choose relative locations. It is not reasonable whatsoever for people to be expected to leave one tax and regulatory regime for another tax and regulatory regime.

To leave is only the last option, you neglected the central method, voting, and the fact that you can also actively participate in the processes and change them from within. Government workers are, believe it or not, mostly just regular people, and government jobs are not unlike any other. Sure, in theory it would be completely viable to opt-out of certain taxes and benefits, but due to the bureaucratic burden to manage that and lost economies of scale it makes little practical sense. Just because you don't feel like opting out by changing citizenship, doesn't mean that's not viable or possible. From what I hear it might be easier to do than getting rid of a mobile subscription.