Re: Libertarian Economics

Michael Lorrey (
Sat, 20 Sep 1997 12:19:23 -0400

Joao Pedro wrote:
> Hi!
> Thanks for all your replies,
> The Low Golden Willow wrote:
> > } Voluntary actions? You're talking of voluntary, unselfish actions from
> > } the same species that constantly kills, destroys and robs other members
> > } of the same species? I don't think that's possible in today's world,
> >
> > Constantly? No city could exist if people constantly did the things you
> > say. Civilization is the great refutation of claims that the mass of
> > humanity is irredeemably shortsightedly selfish and violent.
> Why don't people kill each others? Because there is a law against it,
> make murder legal and you will see people killing each others.
> Why has civilization lasted? IMHO, because there are laws, there is a
> judicial system to prevent anarchy, in anarchy everyone would do what
> they want and that would surely mean the destruction of mankind.
> Civilization doesn't exist because we are good but because institutions
> and persons work very hard at controlling the masses.
> Particullary men are violent, human beings are naturally selfish.
> Education is, IMHO, what makes persons 'look better' than they are.
> > } "united we stand,
> > } divided we fall". If a corporation starts achieving a substantial
> > } advantage towards everyone else, as it grows, it will eventually become
> > } more efficient, more capable, will be able to have the most competitive
> >
> > Hardly necessarily. Alongside economies of scale are prices of scale.
> > An insect can get its oxygen through simple diffusion. Big things like
> > us need hearts and blood vessels to move oxygen and food around. A
> > large corporation needs be more complex, and thus has slower response
> > times, and administrative costs, etc. It works well for mass producing
> > standard products, poorly for high quality specialty goods. Thus the
> > failure of supermarkets to drive out all the small bread and cheese
> > stores in a well-off city.
> >
> > "united we fall, when we make one dumb mistake which effects us all [see
> > China]; divided we grow, as diversity explores many different ways of
> > doing something, and keeps the effects of mistakes localized, and
> > preserves healthy areas which can regenerate the loss."
> What if some corporation doesn't make enough mistakes to fall, it will
> eventualy take control of the market and then we will all suffer. In a
> free-market, there will be the ones who are better than other at their
> business, what if this persons are a lot better? They'll control
> everything in their area.
> > } Besides, many persons are also selfish and greedy. The consumer, the
> > } common citizen doesn't know and doesn't care about environmental issues.
> >
> > Well, that explains why the Western world rose up and banned CFCs. Must
> > have been those nasty Freon producing corporations who told their
> > owned governments to...
> DuPont, one, if not the, largest producer of CFCs had knowledge of the
> destructive effects of CFCs on the ozone but prevented this from being
> known. There are several sources claiming this. Obviously, if they knew,
> others would too, they just weren't paid attention. Only when persons
> started to die did the governments do something.
> It remaind's me of the mad cow disease, with the information available
> in the 80s it should had been taken measures to prevent people from
> eating cows and yet it continued because economical pressures were more
> important than the thousands that might (we don't know for sure) die
> from the human form of the disease.
> Governments are owned by corporations, of course that when people start
> dyeing, action is taken or else no government or even corporation
> resists .
> > The free market of cities has done more, over time, to turn poor people
> > into well-off middle class citizen than anything else. The Church did
> > not raise the poor. Welfare has not raised the poor. Communism -- many
> > attempts -- did not raise the poor. It was the burgs which created the
> > bourgeois, who'd once been poor. All, of course, have had some sort of
> > law-and-order government.
> The free market of cities in America has also created many poor people.
> Violence in America is the proof of this.
> > } ask you something, do you think that the poorer classes generated by
> > } free-markets will stand still? My bet is that they'll riot and that is
> >
> > Poverty has no causes! Only prosperity has causes. Poverty and
> > ignorance are the natural state of humanity, which we work to rise
> > above. The market does not generate poor people; it generates poor
> > classes only insofar as it generates rich classes, creating a contrast
> > with those who have not risen as far.
> Then why shouldn't we build condition so that all can prosper and not
> just a few. It's not a communist ideology, it's a matter of assuring
> basic conditions to everyone, from that to be wealthy is up to them but
> let's at least assure some basic conditions.
> Eric Watt Forste wrote:
> > I prefer to stay away from higgling and haggling over selfishness
> > and altruism: you can come up with an altruistic rationalization
> > for any course of action just as easily as you can come up with a
> > selfish-sounding rationalization. (Well, I can, anyway, so
> > worrying about whether I'm being selfish or altruistic does me
> > no good whatsoever. The point is to do the right thing, not the
> > selfish or altruistic thing.)
> That's an interesting point, it remaind's me of an article in my site
> called "The Selfish Genius", the conclusions are roughly the same.
> > > I'll be honest, I don't know what negative feedback is and I know
> > > nothing of basic economics but I always knew that "united we stand,
> > > divided we fall". If a corporation starts achieving a substantial
> > > advantage towards everyone else, as it grows, it will eventually
> > > become more efficient, more capable, will be able to have the most
> > > competitive prices and therefore, will achieve a monopoly status.
> > > Right?
> >
> > No. Economies of scale don't automatically apply in every
> > industry, and there is usually a "diminishing returns" effect.
> > Monopolies are almost invariably the result of regulators
> > imposing barriers to entry in the market upon potential new
> > competitors. Sometimes this is done explicitly, as with the
> > PTTs and many country's power industries, sometimes it is done
> > in a more hidden manner, as with the banking industries, etc.
> > A market in which the two or three leaders have 60% to 80%
> > market share is not a monopoly. A PTT, on the other hand, is a
> > real monopoly, with all the insidious effects thereof.
> If a corporation reaches monopoly in a no-rules world, it won't lose
> easily and we will all suffer. A corporation with a monopoly status will
> have the better research facilities, the better marketing experts, it
> will even have the best criminals to take care of their opposition! It
> will become unstopable.

A corporation that reaches monopoly status becomes top heavy with
management, responds slowly to changing technologies and markets, and
gets beaten in the end by smaller businesses that take their place.
Here's a test of your claims: name one single monopoly that is a
monopoly now that was a monopoly for the past 100 years without the aid
of government regulations guarranteeing that monopoly status. You can't.
The closest possiblity I can see is Kellog Cereal in battle Creek,
Michigan, and I don't see much technological change in breakfast cereal.
> > > (I see that in Portugal every time, small shops complaining about
> > > big commercial centers and supermarkets)
> >
> > Yes, but which do the customers complain about? Businesses
> > exist to serve consumers, not the other way around.
> But if small shops go broke, the supermarkets will be able to put the
> prices they want and therefore harming everybody.

Small shops that survive do so because they sell specialty products,
like gourmet coffee, cheeses, ethnic foods, etc. that large supermarkets
can't sell economically. The masses that have no interest in bread and
meat at gourmet prices save large amounts of money, there by raising
their real disposable income and standard of living, by shopping at
large discount stores for staple foods.
> > > Since unselfish reasons rarely incentives anyone to do anything,
> > > let me ask you something, do you think that the poorer classes
> > > generated by free-markets will stand still? My bet is that they'll
> > > riot and that is what I fear.
> >
> > The poorer clases are not generated by free markets, the poorer
> > classes are generated by oppressive taxation and regulation
> > which hinders the market from providing them with goods, jobs,
> > and services.
> The rules and regulations prevent the market from employing people? I
> can't believe that.

Its like this: If I've got a yard that needs to be mowed twice a month
to keep it in compliance with community regulations, but the fine for
not doing it is only $5 a month, then I've got to pay somebody less than
or equal to $5 to keep my yard mowed, or pay the fine every month. Since
it would cost me an amortized rate of $2 a month to own a lawn mower, I
can economically only pay $3 or less to a laborer to keep the yard
mowed. Since labor laws say I have to pay at least $5.25 an hour, but it
takes at least 2 hours to mow the lawn, its not economical for me to
employ somebody, so I don't. The lawn doesn't get mowed, the community
morale goes down the tubes, crime goes up, and the kid I could have
hired (and my neigbors could have hired for a full work week) is now
mugging and killing people in the streets because laws prevented me from
hiring a yard boy. ;)
> Michael Lorrey wrote:
> > Its funny, people from other countries are dumbfounded when they hear
> > that US citizens are the most generous of their time and money of
> > anybody in the world. THis is because when an individual pays less of
> > their income to government theives, they tend to see charity as an
> > individual responsibility that comes with greater economic freedom.
> US citizens are the most generous of their time? I'm sorry to be
> skeptical but can you prove it?

I don't have sources here, but any study of voluntary charitable giving
and volunteerism has shown that Americans are more generous than any
other people, as individuals. Hell, look at your newspaper, Ted Turner
(owner of CNN) just donated $1 billion to UN programs. So much for your
claim of rich people being greedy robber barons.

Its pretty logical, if the government were taxing the hell out of you
and running a huge welfare state, how motivated would you be as an
individual to give what little income remains to you to somebody on the
street? The poor are being taken care of already, right? They don't need
any more help from me, right? If you were free of such huge tax burdens
that you never had to worry about money, wouldn't you begin to feel
guilty at your good fortune when you see less fortunate people every
day? Charity and generosity is contagious. Once you do it once, you feel
good about it and want to do it some more. You also are an example and
encourage freinds and relatives to do the same. The difference between
you taking an active role in helping others and letting big brother
government do it for you, is that when you do it your self, you can make
the choices as to how, where and when you are going to give, and you
also have a first hand experience as to what the needs of your community
are, much better than some monolithic government bureaucracy hundreds or
thousands of miles away.
> > So it was the threat to their very lives? I dunno, we in the US have
> > done some pretty good positive environmental things via market pressure.
> > EXAMPLES: Recycling, Dolphin Safe Tuna, BGH free milk (which is opposed
> > by big argri-corps and governments).
> Market pressure or public relations. A corporation makes a positive
> environmental thing, gives it a lot of publicity and then goes on
> destroying the environment but since it did a good thing, it can argue
> with that to continue the destruction of the environment.
> That's not market preassure, that's cheating on the citizens (I'm
> generally speaking).

Any examples? The residents of Seattle would have to disagree with you.
Not counting businesses, individuals in Seattle recycle over 50% of
their garbage (as do businesses). There is nobody holding a gun to their
head to do it, no law, etc. people are free to recycle as much or as
little as they wish.
> > > You talk about how the market will control big corporations and the
> > > millions of consumers will lead the market into the best path, let me
> > > ask you something, why is government so corrupt? People theoretically
> > > control government (by voting) and still government is corrupt, why is
> > > that? What makes you think that indirect control of economy by persons
> > > is going to improve anything?
> >
> > Because government concentrates power in the hands of the few,
> > corrupting the powerful rapidly, while indirect control dilutes power
> > into digestible, uncorruptible bite sizes for everyone.
> Indirect control dilutes the power? Indirect control will make the most
> welthy persons have all the power and do what they want for the harm of
> consummers and general population.

When you leave it to a free economy, as long as the populace is well
informed (even though the conventional media is now mostly in the hands
of multinationals, the internet has nicely sidestepped them, allowing
free communication among the masses), people with power can do little
wrong without the swift opposition of a large number of people.
Political scientists have conlcuded that one of the biggest aids to the
fall of the Warsaw Pact and the Soviet Union was the widespread use of
fax machines for instant communication, sidestepping state owned media.
The Chinese apparently agree, which is why ownership of and access to
fax machines and computers is regulated and licensed there.

Indirect control means that because you have the most power over your
won life, and are protected by what little government there is from
violations of your rights by other people or by the politicians that
other people buy with reelection money, or the laws those politicians
pass on behalf of those people who bribed them, then you can focus on
taking care of your self. People are really pretty good at taking care
of themselves when they are left alone (what about homeless people etc.
you say. Well, you would not beleive the programs there are in this
country for helping homeless people get back on their feet. Those that
remain homeless for extended periods of time are that way because they
want to stay that way. Because most programs require the individual to
give up booze and drugs, those that remain on the streets do so because
they care more about drinking and getting high than in having a life.
And don't say i don't know what I'm talking about, I was once homeless)
> > > I read books, I find it, however, much less boring and time consuming to
> > > ask other persons. Or do you read a book every time you have a doubt or
> > > a question?
> >
> > Yes I do, usually 3-6 books a week.
> 6 books a week? Can you give me an autograph or let me take a picture
> with you? Pretty amazing.

Nah, just the result of growing up as an introverted geek.

As Einstein said, "Why should I memorize something that I can look up in
a book?"

> One last thing, extropy is the opposite of entropy. Our goal is to fight
> entropy or disorder and yet you defend complete disorder in the economy.

It only seems like disorder to a person with an authoritarian, linear,
mindset. Seeing an economy as a highly interactive, chaotic system
(chaotic in the sense of chaos mathematics, not in terms of random
disorder) that responds to and generates its own positive and negative
feedback allows one to conclude that control is not needed, that this
"machine" is quite capable of being left alone and taking care of
itself. History has shown that economic dynamism (recessions, booms,
depressions, etc.) is a result of governments trying to monkey around
with that system with too much positive feedback in too short a period.
There is order to a completely free economy. It is just so complex an
order that most people can only see it as anarchy.

			Michael Lorrey
------------------------------------------------------------	Inventor of the Lorrey Drive
MikeySoft: Graphic Design/Animation/Publishing/Engineering
How many fnords did you see before breakfast today?