Thursday, November 14, 2013

Responses to Jon Stewart’s 19 Tough Questions for Libertarians

A while back, comedian Jon Steward posed 19 tough questions for libertarians. I will attempt to keep my answers brief.

1. Is government the antithesis of liberty?

When libertarians say liberty what they usually mean is freedom from coercion, where coercion is the unwanted intrusion of someone’s body or possessions. We will take this definition as given as we move forward in the questions.

Government is the antithesis of liberty in so far as it is not coercing coercers so as to prevent a greater deal of coercion. A little force to prevent more from happening creates more liberty.

2. One of the things that enhances freedoms are roads. Infrastructure enhances freedom. A social safety net enhances freedom.

All changes in human institutions enhance some freedoms and eliminate others.

Some things that government does crowds out private sector activities. If we had a socialized food programs, there wouldn’t be grocery stores. Sometimes government solves the market’s failure to do something that should be done. Roads might be an example of this. Other times, government does things that shouldn’t be done at all. I don’t know any economic theory that would defend the post office for example.

Just because the private sector isn’t doing something doesn’t mean that there wouldn’t be a profit opportunity if government stopped doing it.

3. What should we do with the losers that are picked by the free market?

What should we do with the losers picked by the mixed economy? Or the socialist economy? There will be losers no matter what. The relevant question is in which system will there be more losers and what actions are morally permissible to alleviate the situation.

4. Do we live in a society or don't we? Are we a collective? Everybody's success is predicated on the hard work of all of us; nobody gets there on their own. Why should it be that the people who lose are hung out to dry? For a group that doesn't believe in evolution, it's awfully Darwinian.

Government is not the only collective institution we have. There are friendships, families, businesses, charities, and wing-night get-togethers. The house you live in was mostly built by people cooperating peacefully without government.

Libertarians do not believe that the losers should be hung out to dry. They almost always believe that the government means either do not justify the ends and/or do not end up at the stated ends, that is, fewer losers.

Demographic data shows that libertarians tend to be far less protestant than the average person, and slightly less protestant than liberals. Evangelical might be more appropriate a metric for predicting beliefs about evolution than protestant. Still, libertarians are far less evangelical than the average person, and slightly higher than liberals. Libertarians are not generally social Darwinists or anti-evolution.

5. In a representative democracy, we are the government. We have work to do, and we have a business to run, and we have children to raise. We elect you as our representatives to look after our interests within a democratic system.

The people are not the government. If the people are the people and the people are the government then there should be no contradiction between legislation and human decision making. There would be no need for laws. The very reason people want to use government is because it would make decisions the people wouldn’t make.

It is incorrect to assess that that the government is the people merely because people have an input and that input (votes) has something to do with the output (policies). The output is a messy distorted version of the inputs because they went through several stages between “votes” and “law” where the purity of the inputs diminish. The output is also messy because we vote for people not policies, and people are bundles of policies that may not be optimal. These people are also capable of misrepresenting what that bundle really consists of. People often don’t get what they think they’re voting for.

Inputs don’t have magnitudes attached to them. If I dislike x more than you do and another combined like x, x becomes law even though there was greater will against it.

The inputs can be based on the selfish good rather than the social good. If government is to provide the social good there is no reason to expect that based on inputs that are based on selfish votes. There is no obvious reason to expect people to vote altruistically than act selfishly.

Economics predicts that the quality of those inputs will be very low in a democracy. The costs of casting a rational, informed vote are all on the individual, the effects of the vote are almost entirely on others.

6. Is government inherently evil?

Yes. Government derives and preserves its power from the credible threat of violence against peaceful people. That is inherently evil. The social contract does not exist. Maybe we can talk about it some time.

7. Sometimes to protect the greater liberty you have to do things like form an army, or gather a group together to build a wall or levy.

Yeah, but I’m not one of these “we need liberty for the sake of liberty” kind of libertarians. See the answer to question one for my affirmation that a little liberty can be traded off for more liberty.

8. As soon as you've built an army, you've now said government isn't always inherently evil because we need it to help us sometimes, so now.. it's that old joke: Would you sleep with me for a million dollars? How about a dollar? -Who do you think I am?- We already decided who you are, now we're just negotiating.

Government can be immoral while creating more liberty.

9. You say: government which governs least governments best. But that were the Articles of Confederation. We tried that for 8 years, it didn't work, and went to the Constitution.

The fact that it happened doesn’t mean it was good. Institutions are not like a person where one experiments until something works. Institutions are capable of negative changes that stick. People have different ideas about what “working” means, and it is very unclear what is causing the system to work or not work.

Was there some kind of spectacular outcome that occurred right after the switch? The Articles served as a check for American aggression against native Americans. With The Articles, the United States would probably have also seen a much earlier and more peaceful abolishment of slavery.

The point is, it is not obvious how great the constitution was in lieu of the articles because the counterfactual is unobservable.

10. You give money to the IRS because you think they're gonna hire a bunch of people, that if your house catches on fire, will come there with water.

America did not have public fire stations until about the time of the Civil War. Include the general economic growth from that time and the additional technology, and there is no reason to believe that we can’t have robust private sector fire stations.

AAA comes to my rescue when I get a flat tire, there can just as well be a fire emergency equivalent. It is not clear that fire stations are a public good.

Some poor people might decide to take the risk. But risk reductions are a good like any other good that we can’t value at infinity.

11. Why is it that libertarians trust a corporation, in certain matters, more than they trust representatives that are accountable to voters? The idea that I would give up my liberty to an insurance company, as opposed to my representative, seems insane.

Exclude the sentiments toward the villainy of insurance companies – it is unclear why Jon Stewart would want any market mechanisms when he has politicians which are perfect, or at least very good manifestations of the public will. He doesn’t deal with what matters, instead he frames things as good guys and bad guys and then asks you to interpret what “seems” to be. What matters is why insurance company profit is so bad for consumers but profit in other sectors is so good?

Besides, Corporations are legally invented institutions.

12. Why is it that with competition, we have such difficulty with our health care system? ..and there are choices within the educational system.

Well for starters health care expenditures are paid 48% by government, 32% by private insurance which is subsidized through government tax policies, and only 12% by the consumer. The excessive consumption that results form third party payments bids the price up, and anybody who can’t get access to the funds from one of these third parties has to deal with the absurdly high prices without the help.

On the supply side, medical licensing ensures that consumers have to pay and wait for highly qualified doctors even for the simplest of problems.

As for education… Does Jon Steward think that education is great? There are choices if you’ve got money, a lot like health care.

13. Would you go back to 1890?

No. 1890 was much worst than today. The institutions of 1890 versus today reflects to some degree the rate of growth, not the level of standard of living. The difference in absolute standard of living between 1890 and today comes from 100+ years of general economic growth.

14. If we didn't have government, we'd all be in hovercrafts, and nobody would have cancer, and broccoli would be ice-cream?

Nope.

Suppose that in 50 years we have hovercrafts, a cure for cancer, and broccoli ice cream. Would you expect they came from the private sector or the public sector?

15. Unregulated markets have been tried. The 80’s and the 90’s were the robber baron age. These regulations didn't come out of an interest in restricting liberty. What they did is came out of an interest in helping those that had been victimized by a system that they couldn't fight back against.

Again, there is a difference between growth and absolute standard of living. The poor weren’t poor because of the robber barons, they were poor because the stuff they needed did not exist. GDP per capita back then was a couple thousand dollars. The best you can do if you spread all the wealth of the robber barons equally was give everybody $3,000 a year to live on.

Economists distinguish between natural monopolies and legal monopolies. Natural monopolies arise under a particular set of conditions. Markets naturally tend toward competition not monopoly. It is not clear how much of the robber baron’s monopoly power came from legal forces vs. natural forces. Railroads for example were heavily subsidized by government, either financially or by granting very generous property rights.

Contrary to popular sentiment, monopolies are not bad per se. It is the use of monopoly power to restrict supply and raise prices that causes economic harm. Simply putting competitors out of business by offering a better product for a lower prices is a market virtue. It increases standards of living for the many consumers, while the few competing producers go find other things to do. It is not obvious that Rockefeller, for example, engaged in monopolistic restrictions in supply. On the contrary, some claim that he lowered the price of oil and kept it low even after his competitors exited the market, which would be spectacular for poor people.

Interests are not outcomes. Most libertarians want a more libertarian world out of interest for those who are needy. Ask a libertarian why they oppose minimum wage. They usually don’t even mention liberty, they mention that your pricing poor people out of the job market.

16. Why do you think workers that worked in the mines unionized?

Presumably because they wanted a higher standard of living. Here’s the problem, one can’t improve the general standard of living by targeting workers because labor is in input. Policies that target consumers on the other hand effect total outputs, effectively raising wages. That surplus compensation can be taken in the form of cleaner, safer, more enjoyable jobs through compensating differentials. With wage increases through economic growth, workers can afford to discriminate against unpleasant working conditions.

17. Without the government there are no labor unions, because they would be smashed by Pinkerton agencies or people hired, or even sometimes the government.

Maybe. Most workers are not unionized (something like 88% last time I checked). And yet wages and working conditions for non-unionized workers is far above that of the past. You might think that those government working condition standards are keeping your nightmares from becoming reality, but virtually every employer exceeds them. In most states employers are not required to give breaks to anyone but minors, and yet breaks are the norm.

When it is clear that normal market forces rather than legislation is what is protecting 95% of the workers -- because the legislation does not even apply to 95% of workers -- then why is there this fear that if government didn’t protect the other 5% then standards would immediately revert back to that of the 18th and 19th centuries?

18. Would the free market have desegregated restaurants in the South, or would the free market have done away with miscegenation, if it had been allowed to? Would Marten Luther King have been less effective than the free market? Those laws sprung up out of a majority sense of, in that time, that blacks should not.. The free market there would not have supported integrated lunch counters.

Legislation can change actions, but it didn’t change minds. The biggest difference between the 60s and now is that minds have changed. Don’t think so? The fact that discriminators have to keep to the shadows is evidence that discrimination is not as popular as it once was.

Black employment doubled the decade before the civil rights act was passed. People were already changing before legislation. Then the legislation passed, and it is treated like it is the only possible explanation for the continued decline in discrimination. Decline in discrimination had to already be occurring for the legislation to become viable.

Discrimination is not profitable. Hiring based on race rather than productivity is not profitable. Turning down customers who are willing to pay is not a profitable strategy. Markets discourage discrimination, not reinforce it. One of the reasons discrimination was already on the decline.

I would much rather be discriminated against than give my money to someone who would discriminate against me if it weren’t for the legislation. Laws camouflage discriminators, leaving me unable to discriminate against the discriminators.

19. Government is necessary but must be held accountable for its decisions.

Accountability is not a realistic expectation when it is extremely unclear what policies lead to what outcomes. Also, accountable to who’s ends? Accountable to which political party’s means? “The people” don’t have a single will. They have a whole cascade of different means which they think will lead to their cascade of different ends.

There is no reason to expect the people who are supposed to be holding government accountable to know what they’re talking about (see question #5).

Suppose government weren’t necessary -- people are so superstitious about government that almost nobody would realize it.