In the comments of my last post, commenter Russell Garrard wrote the following:
The Bush-haters will tell us that the supreme head of our government and his minions are supremely sinister and fiendish liars (albeit also moronic bumpkins). Then they turn around and tell us that only government can be trusted to vet what we put in our mouths and bodies. I don’t get it….
The larger argument that Russell is making (and we continued the back and forth in the comments over it) is that the government shouldn’t be trusted to do anything because free market forces will invariably do it better. I’m amazed at how often I hear this considering how much evidence there is that it’s not true in a number of circumstances (see: Larry Kudlow looking ridiculous on his own show when defending free market health care against Ezra Klein). The logic behind it is that companies will be so afraid of the financial ramifications of doing things against the public interest (secretly having bad things in their products or implementing cruel labor practices) that it’s pointless to have any kind of oversight by the government. This ignores a massive amount of history and common sense. Companies pursue profits and there have been many situations where that pursuit of profit has run counter to the general welfare of the citizens.
One of the more common ways in which this has happened is when it comes to addictive substances. From the tonics of the 19th century that secretly contained morphine to the cigarette industry of the 20th, companies have often put their pursuit of profit before the public good. These industries weren’t reformed because the corporations stopped seeing the profit potential of their actions, they were reformed because the government established rules (in the case of morphine, laws were created in the late 1800s that forced manufacturers to identify the ingredients of their tonics, causing many of them to immediately go out of business rather than admit their product contained morphine). Not all of the rules that our government has made over the years are perfect – in fact, some have been terrible – but a society is strongest when it allows for free enterprise, but also ensures that government can act as a corrective mechanism that can establish rules and safety nets for a system that, by design, ends up with winners and losers and a growing gap between the haves and have-nots.
Part of the myth that government is useless and unnecessary is rooted in a belief that any time government spends money, it’s an inefficiency. If there were a real need to spend that money, some say (and please feel free to read through this Sound Politics post and the comments if you think I’m just inventing a ridiculous strawman) that it’s only worthwhile to do if an actual person or company sees a profit potential. In this mindset, no roads, schools, or scientific research should ever be funded unless a company saw profit potential in that investment. Otherwise, it’s a waste. I never imagined that I would encounter so many people believing in such oversimplifications, yet I manage to come across it all the time when looking for things on our local right-wing blogs to make fun of. For all of these people, the moon landing must be the greatest boondoggle of all time, especially since some people still aren’t convinced we really went there.
Like the moon landing, there are valuable things that government can do that don’t provide the kind of immediate direct profit potential that a corporation would be interested in. From building transit to improving park space, there are various things that would give a return on investment for an entire community or even the entire country, but wouldn’t make sense for a corporate bottom line. As a capitalist system grows and matures, I believe that it can eventually allow for more and more of these things to be done by private entities (and this often puts me at odds with many liberals), but a belief that there’s some truism that a corporate entity is always the superior option distorts the proper balance we need to have between having the things we need provided for us by those motivated by money and those motivated by the ballot box.
Going back to the Sound Politics post I linked to, the Edmonds School District administration building obtained an espresso machine. The price tag ($10,000) alarmed the Sound Politics peanut gallery and many wailed about how wasteful government spending has become. The only problem is that the espresso machine was bought so that faculty could purchase their morning brews for less money inside the administration building and the proceeds would go towards the district’s general fund and toward school lunches. The machine was expected to pay for itself in less than two years. If that’s true, and there’s no reason to believe it wasn’t, it was an intelligent use of school budget funds and government doing something smart.
But that’s not how it works among the faith-based capitalism crowd. Whenever government spends money, it’s an inherent inefficiency to them. To demonstrate how this can lead to pure silliness, let’s say there are two cities that each have a park that needs to be refurbished. The first city finds a coalition of business owners and private citizens who pony up the $50,000 for the refurbishing. The second city uses public funds. There’s an argument to be made that the second city is not wisely spending taxpayer money, just as it’s possible that the business owners in the first city might not get what they think they may get back from their investment (good publicity). But what I don’t agree with is the idea that the actual job of refurbishing the park will be done more or less efficiently depending upon which avenue is chosen. The idea that those being paid by a for-profit entity will work harder than those being paid the same rate by a government entity has no basis in any reality that I’m familiar with, yet it’s an article of faith for so many. The issue of accountability usually appears in that theory as well, but anyone who’s ever worked in the private sector can tell you that massive inefficiencies and beaurocracies exist in for-profit entities as well.
Leave it to our friend Stefan to take this idea and go careering over the hills with it.
Last weekend I asked readers to suggest a word to represent the opposite of “Statism”. Thanks to all who participated in the ensuing discussion. Among the best suggestions: classical liberalism, small-l libertarianism, objectivism, Americanism, capitalism. My personal favorite, suggested by Eric Earling, “civic entrepreneurialism”. That best captures the spirit of what I was looking for — civic engagement based on private enterprise, as opposed to state coercion. But I’d still prefer a single snazzy word to represent the concept.
Incidentally, the concept of private initiative in lieu of state coercion is, IMHO, the preferred alternative not only where it is traditionally proposed (e.g. education, social services), but also for traditionally social conservative issues. Take, for example, abortion. This merits a longer post, but if the goal is to reduce the number of abortions, wouldn’t it be more effective for private organizations to deliver positive messages to change people’s minds about the issue, than to expect government intervention to solve the problem?
After I read this post, I sat back in my chair, stroked my goatee, looked up at the ceiling, read it again, thought about driving down the coast this summer, paced around the room a few times, read it a third time, rubbed my temples for a minute and then just turned the computer off. After a few days, I think I’ve got it.
Going back to the example with the parks, Stefan has actually convinced himself that not only can private enterprise refurbish the park more efficiently than government can for that $50,000, but it can do a number of things that government is completely incapable of doing as well.
It’s true that there are a number of things that government can’t do. Following drug policy, I’m well aware of what the limits of government are. Whether it was alcohol prohibition of the 20s or the current drug prohibition, people in our government have been trying to do the impossible. It just can’t deter people from exhibiting irrational behavior, and drug addictions are irrational behaviors. If those irrational behaviors have been shown to be detrimental to others, we obviously demand the government deal with that person, but putting them in jail doesn’t “fix” their irrational behavior – even when the sentence they are given is justified. This is why government-run drug treatment programs have been shown to be very cost effective from a taxpayer standpoint.
But this is very different from establishing rules or openly participating in a marketplace, where people overwhelmingly display more rational behaviors. People may not always make the smartest decisions when it comes to their own finances or running a large corporation, but they tend to have a rational basis for their decisions. As a result, government can be much more effective at using prison or financial penalty as a deterrent and to get people to play by the rules. There will always be a small subset of people who will act irrationally out of greed, and just as those whose drug addictions cause them to violate the freedom of others, they should still be sent to jail (or fined), even it doesn’t deter their irrational behavior without counseling or other psychological help.
For Stefan, and the Sound Politics nut squad, government can’t do anything at all, and beyond that, who knows what things they’ve tried and failed at that the free market can do! People are still having abortions? Hell, we haven’t unleashed the grand power of capitalism at that scourge. A few Wal-Mart funded PSA’s and the abortions just disappear. Haven’t solved drug addiction? Give Bank of America the keys. Can’t defeat terrorism? Try Blackwater (oh wait, we already did that).
Even though government has no ability to make people act responsibly if their motivations are irrational, it does have the ability to be responsible in dealing with those who are acting rationally. In other words, government is mainly useless in changing behaviors done in the pursuit of pleasure, since those behaviors tend to be impulsive or irrational, but it can be useful in dealing with those done in pursuit of profit. The pursuit of profit is a major motivator in life, but it’s not the only one, and government can utilitize other motivators like patriotism, compassion, and scientific curiosity to accomplish things as well. It’s just imperative that we hold the people we put in government accountable for what they’re doing.
Stephan and his cohort have no problem shoveling vast amounts of money at the “national defense”. But the real nub of the matter is this: Nearly all free market whackos simply advocate a different system of subsidy, be it the Whigs (gov. money for canals and railroads), tariffs (GOP doctrine, 1865-1932, and for many industries, to this very day), bending the tax system for private gain, extravagant defense systems boondoogles, market entry restrictions for doctors, lawyers, and accountants, and patents, just to take a few.
They are nanny state conservatives. This free market crap is just a nicely put together cover, an ideological Potemkin village.
The wisdom of a free market idiot: “…wouldn’t it be more effective for private organizations to deliver positive messages to change people’s minds about the issue, than to expect government intervention to solve the problem?”
Too funny. I can only think he is referring to the purveyors of the pill and rubbers as these ‘effective private organizations’. Most do not go into business to ‘change people’s minds’. Apparently there is a free-market failure here, but Stephan can’t bring himself to admit this, because it would go against his conviction of the universalism of free markets. What a dolt.
The assertion that markets do not ‘coerce’ people is a monsterous intellectual fraud.
This attitude might even be more prevalent than you think Lee.
I used to work as a firefighter and I ran into this all the time. Let’s call it the “Conrad Burns” syndrome. I bet pretty much everyone remembers the fine upstanding former Senator from Montana who thought it a good idea to verbally attack a bunch of firefighters who were resting on the tarmac of an airport after having worked their asses off trying to stop a fire.
The most revealing thing about the whole episode was the assertion that Burns made. Burns seems to have thought that the firefighters just sat around all day getting paid tens of thousands of dollars.
“See that guy over there? He hasn’t done a God-damned thing. They sit around…. It’s wasteful. You probably paid that guy $10,000 to sit around.”
Of course, Burns seems not to have known that Hot Shots only get paid $7-10 / hour and bust their collective asses on fires where 80 hour weeks are not uncommon.
I personally ran into this several times where some idiot would come running up to my crew berating us for being lazy and ‘chucking out used chain saws’ instead of repairing them. As far as I know there were no senators in the bunch but I can’t rule it out.
Government is there because people don’t have the 3 or 4 lifetimes it takes for the ‘free market’ to balance/police itself.
Case in point: Crap entering our food supply. Over a couple of lifetimes, enough people will get sick and/or die that customers will notice that certain products aren’t worth the money and take their business elsewhere (see recent pet food situation). Possibly, and this is a BIG if, the manufacturer will realise that killing off his customer base is a stupid way to do business. Or not – look at tobacco.
The point though, is that people would be sick and/or dead for the ‘free market’. In order to really believe in the ‘free market’, you have to believe that people dying is less important than whether someone wants to make cough syrup with anti-freeze.
“Free Market”
This is an oxymoron. Markets are themselves organized forms of activity and ONLY owrk if there is supervision, that is governement. Three examples:
a. Microsoft
This company is amonopoly, perhaps a natural monopoly. The same is true for eBay and Google. Left tot heir own deserts, w/o public oversight these monopolies becaome indistingishable form governement, Indeed the essence of fascism, before the term was misapporpriated by the Nazis, was eactly the fusion of large coprs and the govt.
b. Africa
Many African countries have nearly free markets. The result are obvious.
c. Healthcare
The US purports to have a free market but in practice there is no competition at the patient level. The result is run away costs.
d. Universities
These are really odd because they operatre in a free market that is non profit. Or is it?
On the other hand, there are goverment run entities that USE free market principles very well … e.g. my own profession research biology. We compete madly for your dollars, my friends.
Another example where I believe a free market, run by the government, can workl wellm is schools. Charter Schools should be the norm, not an exception. Indeed, imagine a competitve market where the public charters compete, with their subsidies, vs the private schools? Can you imagine the screams from Lakeside?
Fianlly, I think the free market issue iks NOT a liberal concervative issue. The Bushies are perfectly happy dealing with controlled markets as long as these are outside of government. The liberals see to me mor eopen to pragmatism. Free market is just a tool. If we can createa free market, as I favor for schools and health care, I suspect we would be a lot better off than out current mixed models.
b. Africa
Many African countries have nearly free markets. The result are obvious.
Absolutely, and this is a point that is lost on many people.
Great analysis Lee, my only quibble would be with your discussion of “rational” vs “irrational” behavior.
I think there are many more people who act rationally out of greed. Rational self-interest is what supposedly drives the market. And it is rational to adulterate your wheat gluten with melamine if all of your competitors are doing it too, and there doesn’t seem to be a penalty.
Also, I would argue that a drug addict’s motivation, at least that which drives the addict to do what is necessary to acquire more drugs, is, at least within the context of the addict’s reality, somewhat rational.
I think there are many more people who act rationally out of greed. Rational self-interest is what supposedly drives the market. And it is rational to adulterate your wheat gluten with melamine if all of your competitors are doing it too, and there doesn’t seem to be a penalty.
Goldy,
That’s true and I think I needed to be clearer about this. What’s not rational is doing it knowing that you will be punished for it. Governments can stop people from acting rationally out of greed, and my point is that those who would pursue profit in clear violation of the law are irrational (and rare).
Lee, since Voice of Asses Wiping injected China into his invective, why are so many on the left enamored with Hugo Chavez of Venezuela? Hugo is the titular government head and he is pursuing irrational governmental profits in the name of nationalization so he can give “handouts” to the poor, suppressing his political adversaries, changes the law to make it legal what he is doing, and is demonstrating over-reaching GREED? Why is he financing a movie for Danny Glover out of these profits for $18.3 Million?
The logic behind it is that companies will be so afraid of the financial ramifications of doing things against the public interest (secretly having bad things in their products or implementing cruel labor practices) that it’s pointless to have any kind of oversight by the government. This ignores a massive amount of history and common sense. Companies pursue profits and there have been many situations where that pursuit of profit has run counter to the general welfare of the citizens.
This is because, as we learn in Econ101, they are allowed to externalize the costs.
Lee @9,
In clear violation of an enforceable (or enforced) law. I think you would agree that much of the drug trade is very rational. Traffickers make the rational decision that the profits to be earned outweigh the risk of being caught and punished. It may sometimes be a poor decision, but it is a rational one nonetheless.
Profit vs Risk. That’s capitalism.
Let us not forget that the same ideologues who worship at the altar of the free market, proclaiming that unfettered free market capitalism is the only route to fairness and liberty, are the same folks who promote tort reform. Not only do these folks want government regulators out of the corporate hair, but they would deny juries the right to assess responsibility when corporations cause harm. Greed without consequence, that would be the goal.
@12
That’s true as well. And it’s part of the reason why so much of America’s drug trade is rooted in foreign organizations or within groups where the threat of jail isn’t much of a deterrent. In fact, even the mafia ceded control of drug trafficking because it was making them too easy to target. But the demand of addicts, something that is neither rational or done in pursuit of profit, is what drives the market, and those profits just keep creating headaches for places like Mexico and Afghanistan, where the laws have been unenforceable…
As I understand it (and economics is not my specialty), free markets operate efficiently and well only in the presence of more or less perfect information on the parts of both buyer and seller. Therefore, one of the functions we have assigned to government is that of regulating what buyers and sellers must disclose. To use the handiest concrete example, when a company is importing tainted food products from thousands of miles away, they have an opportunity to learn if the products are sound before the sale; we do not. That informational imbalance trashes the whole notion of a “free market.”
And that IS why our government MUST “vet what we put in our mouths and bodies.” And if an administration does a poor job of it, we MUST turn them out.
There’s nothing wrong with the liberal model of government regulation for the public interest of self-serving for-profit businesses. In fact, the history of pirate capitalism has repeatedly demonstrated that business can’t function properly without such regulation.
The only thing wrong with our government is that it’s being run by people who hate government and are sabotaging it to prove government doesn’t work. Of course government doesn’t work when the people running it don’t want it to work.
The solution is not changing the model, but changing the management of both business and government.
I see Bush’s approval rating is down to 26%, officially making him less popular than Jimmy Carter AND the worst.president.ever.
Thanks for nothing, all you brain-dead wingnut fools who blindly supported (and continue to support) this corrupt charlatan and incompetent.
The solution to the problem of a corrupt anti-consumer political party running our government’s regulatory agencies is to get rid of the corrupt anti-consumer political party, not get rid of regulation.
“In this mindset, no roads, schools, or scientific research should ever be funded unless a company saw profit potential in that investment.”
One thing that is absolutely clear is that rightys only believe in religions that someone is making a profit from.
“Like the moon landing, there are valuable things that government can do that don’t provide the kind of immediate direct profit potential that a corporation would be interested in.”
On the other hand, there are valuable things government does that do provide the kind of immediate direct profit potential that corporations are interested in. For example, the basic research that leads to new drugs, virtually all of which is done in government and university labs. Drug companies don’t invent (they prefer the term “discover”) drugs. They are merely marketing organizations that typically spend less than 10% of their revenues on R & D and often 50% or more on advertising and sales. And such R & D as they perform largely consists of reformulating or combining existing drugs as a legal gimmick to extend the patents that allow them to sell formulas invented by government and university scientists at monopoly prices, although the Supreme Court took the air out that practice last month by ruling reformulations and combinations aren’t patentable.
“The first city finds a coalition of business owners and private citizens who pony up the $50,000 for the refurbishing. The second city uses public funds.”
In this model, what’s likely to happen is the city hires a contractor employing American workers and paying them prevailing wages that a family can live on, while a businessman hires Mexican illegals and pays them $3 an hour under the table on which no payroll taxes are collected or reported.
re 10: Medical care and education are not “handouts”. They are very necessary social services that ultimately cause the free market to perform better than it would otherwise.
It’s enlightened self-interest for your type. It’s just the morally correct thi9ng to do from my point-of view.
“For Stefan, and the Sound Politics nut squad, government can’t do anything at all”
We know government can’t fight a war or rebuild a nation when THEY’RE in charge.
re 15: Another part of a “free market” would be a labor force that was free to organize AND is free (like capital now is)to move en-masse to any place that wages are better than their present location.
“Free Markets” depend on captive labor.
One thing I’ve observed over the years as that the capitalist class always wants taxpayers to pay for necessary but unprofitable things.
@22 Medical care and education aren’t just social services, they’re also part of the necessary economic inputs into the labor component of production. See #25.
As for a “vouchered” education system, I have this for free-marketers to mull over:
Public schools pay better than private schools. Public schools have unions. If you voucher all the dumb and troublesome kids to the private sector, you’ll see just how good public schools really are.
“Here you go, private schools! Here’s $10,000 and a little jailbird punk. Here’s another $20,000 and a 15 year-old autistic kid who’s already inadvertantly put 10 of his caretaker/educators in the hospital.
Oh, you say, private schools will only take the “best” students. They are , after all, private.
Fine. You’ll relieve the large class sizes in public schools enabling the higher paid/better qualified public school teachers do a better job.
Believe me, private schools don’t really want to deal with kids from the rough and tumble world of real America. The upper classes will simply build private schools that mirror the ones that receive the public students.
Much like the TWO HARVARDS. That’s a book, wingnuts.
“Legislative ‘fix’ for Talk Radio.”
Let’s be honest here. The market prefers conservative talk radio to the anti-american, screeching, scary, leftwing radio. Therefore, we must “fix” this “problem.” We WILL force americans to love leftism, even if it means we must destroy freedom.
Lee @ 14: ‘But the demand of addicts, something that is neither rational or done in pursuit of profit, is what drives the market…’
Au Contrar. Demand is demand. Utility theory makes no judgements regarding ‘rationality’. It has no tools for doing so.
The equibrium (that’s not a drug)price is high due to constrictions on supply (laws and their enforcement). If dope was legal the price would go way down, and you could trade dope futures in Chicago. Content would be regulated by the FDA.
Whether on not there would be ‘more addicts’ depends upon the shape of the demand curve. There is some debate about that.
Drug dealers are simply rent-seekers (in the economic sense). The demand curve may be highly inelastic. Opinions vary.
While we’re being honest, how about if we note that conservative talk radio is no less anti-American, screeching and scary that anything liberals could ever produce? They just have a head start and better marketing, that’s all.
@29
“scary, leftwing radio.”
Everything scares you guys…what a bunch of wussies.
re 29: You are blathering in a weightless vacuum populated with straw men who are coming apart and the floating detritus is obscuring your vision.
Translation to wingnut-speak: You are a lieing anus head.
http://www.conceptualguerilla.com/
“Sir Topham Hatt In China
Submitted by Greenrage on Fri, 2007-06-22 06:25.
By now everyone’s heard the news that Thomas The Tank Engine toys have been outsourced to China. So predictably, the paint on the cheerful locomotives-slash-bitchy-characters is tainted with toxic levels of lead. Some recalls may occur, if the market fundamentalists Bush has placed in the Consumer Product Safety Commission ever get around to having children and developing a concern for their neurological well-being.”
Facts kill wingnut rhetoric.
Au Contrar. Demand is demand. Utility theory makes no judgements regarding ‘rationality’. It has no tools for doing so.
This is true, and as I’ve thought about how I’ve described this, you and Goldy are hitting upon how I could’ve done a better job. Demand doesn’t neatly fall into the category of rational or irrational. Although, what I contend is that demand that arises from impulsiveness or desperation is impossible to stop because of its inelasticity. At some point, the price reaches a point where the benefit/risk ratio makes sense to someone.
Thanks for the comment.
http://www.msnbc.msn.com/id/19370373/
Looks like the Publicans can’t even find candidates with clean aides let along elect them.
@29 “anti-american, screeching, scary, leftwing radio”
You’ve got it exactly backwards. The unpatriotic, America-hating, soldier-hating, Constitution-hating, law-breaking, screeching monkeys are the talkers of rightwing hate-radio.
@30 Demand for illegal drugs is high because they’re free to users. Addicts don’t pay for them with their own money; they don’t have any money. They get drugs by stealing from others — burglary, identity theft, credit card fraud, what have you. Property crimes fuel the drug trade.
@32 “Everything scares you guys…what a bunch of wussies.”
That’s not exactly true. While wingers certainly are paranoid freaks, they’re not afraid of things that ought to scare them. For example, a president who ignores the Constitution and breaks laws, and an attorney general who approves torture and hires party hacks as federal prosecutors. Because, you see, this can cut both ways.
The silver lining in the dark cloud of the last 6 1/2 years is that Republicans are no longer in a position to complain about anything Democrats do after we get back in.
We can — and should — turn a deaf arm to their complaints. Fuck ’em! They’ve got it coming.
First thing we do is, let’s raise their taxes!
Next, if it’s not practical to stop their Iraq war right away, let’s draft their kids.
And definitely not to be overlooked is taking away their corporate welfare.
@35 “demand that arises from impulsiveness or desperation is impossible to stop because of its inelasticity”
A fairly good description of the gasoline market.
Case in point: “natural” dietary supplements, where FDA today promulgated truth in labeling rules (completing a 13-year rule-making process). Some vendors were spiking their herbals with ED drugs and such. Unlike the ivory tower idealized market model (where every buyer and seller is perfectly informed), how’s an unwary buyer to know?
Morphine in their patent tonics and elixirs made our 19th-century feel good; viagra in their ginseng and megavitamins might do the same for their 21st-century descendants.
@30: Sorry to disagree Roger. Demand for drugs may or may not be “high”, but the prices certainly are (I remember $10 lids). The only reason prices are high is because the stuff is illegal. If drugs were legal, prices would drop like a stone. Criminey, you can grow way potent stuff in your basement!
Addicts wouldn’t have to steal. We could give it to them for nothing. This puts the pusher out of business, and we can tear down a lot of way too expensive and socially destructive jail space. You appear to be confusing the level of demand with price. They’re not the same thing.
44 comments and only two from wingnuts. How did you do that, Lee?
41
Let’s abort all their babies, too!
And, let’s euthanize all of them over 40!
Oh, and how about making all of the Republican bastards pray toward Mecca 5 times a day?
Ah, the possibilities are endless for making the rightwing fringefucks pay for their sins.
44 comments and only two from wingnuts. How did you do that, Lee?
I bring fear to their hearts.
@44 I’m not saying street drugs are cheap. I’m only saying their price doesn’t affect demand because the people using them are paying for them with other people’s money and valuables. The drug epidemic accounts for a large proportion of property crimes.
Interesting – I wonder who gave the righties their talking points about the “left trying to control talk radio.” Since when is that racist, KKK-lovin Trent Lott a “leftie?” He’s the one dissing talk radio lately.
“…if the goal is to reduce the number of abortions, wouldn’t it be more effective for private organizations to deliver positive messages to change people’s minds about the issue, than to expect government intervention to solve the problem?”
“[I]f the goal is to reduce the number of abortions,” then we should educate young people about their bodies and desires, and ensure that contraceptives are easily obtainable. I was riding the subway in New York last week, and it seemed that every car had an advert from Planned Parenthood, urging the use of condoms. We can educate in the public schools, public health departments can subsidize contraception, AND we can have private non-profits do the same. Drugs companies and makers of prophylactics do some of this work for profit. The silly idea of an absolute dichotomy (private profit/government) is bad enough, and assuming that one is always better than the other just makes it worse.
Now, if we want to increase rates of STD transmission, increase the number of unwanted pregnancies, and therefore increase the abortion rate, we should spend all kinds of public money on fake education, telling lies to young people (“sweat and tears can transmit HIV”, claimed one abstinence-only program), and making contraceptives harder to obtain. When a right-wing free-marketeer criticizes that dangerous waste of public money, I’ll believe in their sincerity on this issue.
Finally, the only truly “free” market is the “black” market, where fraud and other crimes run rampant. Even professional athletes do not attempt to play games without umpires.
What effect does the transferability of virtual caital have on the concept of a free market?
Classical economics teaches that mercantilism, that is the pursuit of busingess to amass cash, fails unless the cash is invested to imporve the productivity of society or entity generalting the cash. So Spain failed because they acquired huge amounts of capital at low cost by looting the new world. This might have worked fine, except that the Spanish invested their capital in France and the Netherlands, giving rise low cost industries there while nothing was developed in Spain.
The analogy to Seattle seems obvious. In our economy, a huge part of capital is in the form of intellectual property. In this economy, jobs are driven by where the IP is applied . So today, Boeing may have factories for the 787 all over the world but the highest paying jobs are in Seattle where the machine is designed and assembled. We read that Boeing is very leaslous of this skill set.
How difficult would it be to transfer the manamegement skills to China? The issue os even clearer if we ask how dificylkt it would be to transfer the proprietary skillsets behind Microsfot or Starbucks? The ease of transfer of intellectual property seems to me to have a huge effect on conventional nationalistic economic models because the cost of transferring the capital, in the form of the productivity engine, to another coutry is negligible.
The implication is that knowledge economies are NOT in the interests of a nation’s workers unless the nation and the corporation are synonymous, i.e. fascism!.
For those too young to remember, fascism was once synonymous witn a model of governewmtn where large coprorations and the state merged. Mussolini may have ended up looking like Hitler’s cousin, but his ability to strengthn the Italian econmy was touted by Roosevelt and other liberals as an example to the world.
In today’s global economy we have both liberal/democratic societies and fascist societies. In the non fascist societies within this economy all jobs migrate to the lowest possible cost employers. This low coat, a la Ricardo, is acceptable to the source economy because productivity of the original workers ,,, now intellectual managers … is vastly increased.
Of course, the usual implication is that the source economy will grow by investing more in the high productivity, IP generating sector. The latter assumption seems to me to be faulty. The Amerfican (or Seattle) corporation generating the IP is not the Nation. It may well be in the corporation’s interest to transfer the IP generation to a lower cost market as well, iff that marlet is susccesful in producing IP. In a liberal/demcratic society, there is no motivation of coprorations to invest in development of an intelelctual workforce since that is the task of the nation.
So here is my scenario. Imagine the world does not go to war and global warming remaining a marginal cost. Suppose that 1/3 of USA capital is in IP rich industry … from Boeing to Hollywood. Lets take any one such entity. What would it cost Microsoft or Boeing to become an Indain company?
Don’t get me wrong. I believe in global economics and consider myself first a human then as SeattleJew. A global economy is probably the most good for the most people (ironically). However, if my model is corect, the fascist states will have an innate advnatge over the liberal domocratic states. Liberalism (classical definition) means the inevitable loss of productivity aka capital by the American worker.
I also see dismal solutions to this problem … war or American fascism being the usual answers. The lateral term may not be totally firghtening. European countries, along with Japan and Korea, seem t me to be pursuing a model that might be called sate corporatism. At one level this means that there are incentives for Daimler, Airbus, or Nokia to invest in the intellecual infrastructure of the nation. How can tis effect the US? We still live under the dream of Jefferson where each Ameican is free to devleop her own business (well Tom would said his). Is there a European like model that can take root here? Is the alternative Bushism?
SeattleJew
Hey guys–you never really addressed the substance of the thought—why is it that conservative radio gets big voluntary market share, but leftwing radio has to be FORCED onto people (if you listen to the lefties upset that people don’t choose their stuff nearly as much), and we must pass LAWS making things “fair”. What–you don’t believe that if just as many people wanted to hear anti-american drivel that they wouldn’t pile that stuff on the radio as fast as they could? Media gives people what they want. Otherwise, who’s going to listen? You can’t FORCE people to listen….or so we thought
Shoopee
If only it were that simple.
Faux is a success in part becasue the right rish choose to invest $$ this way. No one has tried an equally leftish network so it is difficult to know what would happen.
The mirror image to your question s how come cocnerbvtaives can not make a popular movie the way Michael Moore or Gore does?
“Hey guys–you never really addressed the substance of the thought—why is it that conservative radio gets big voluntary market share…”
Because radio is a fully-regulated, closed market. You need a government license to operate a transmitter, and corporations control most of the frequencies. The government is supposed to regulate in the public interest, but corporate interest has replaced the public interest.
Imagine if we banned commercials from radio? Would all of those “dittoheads” pay money to keep Limbaugh bellowing, like we liberals do for public radio? Ha, ha, ha…