Emails: Debating Limited versus No Government

Limited Gov Guy: I was arguing with [my girlfriend] last night about the Affordable Care Act and how it is not the government’s place to take care of sick people. I argued instead that the government is mainly there, to plagiarize Milton Friedman’s words, for the role of enforcing contracts between individuals and punishing individuals who violate others’ rights.

If you accept that (I know you might not), then consider this:
In the following scenarios, a citizen’s right to life is threatened by three different assailants.
– If an individual were to assault someone on the street for no reason, I would want the government to imprison that individual.
– If a wild animal were to attack someone unprovoked, I would want the government to contain or destroy that animal.
– If a bacteria infects someone and starts to kill them, then why should not the government take actions against that bacteria to protect the citizen’s right to life?
That’s what [my girlfriend] said to me, and I had no response.
I know it’s wrong, but I don’t know why.
Thoughts?

Free Association Man: If an individual were to assault….. but this doesn’t mean the gov can force you to enter into a contract with a body guard.

If a wild animal were to attack… but this doesn’t mean the gov can force you to enter into a contract with an animal trainer.

If a bacteria infects… but this doesn’t mean the gov can force you into a contract with a health insurance company….

BTW: We have the CDC, NIH, and the FDA already charged with viral and bacterial defenses for the population.

The pain for the ACA is all back-loaded to 2017. Mr. Obama says the ACA is “working” because more people have health insurance. But that’s because the gov is subsidizing enrollments. This is why a SCOTUS decision against subsidies would have killed the ACA. The subsidies expire, penalties begin, and all the new taxes (not fees…thank-you Chief Justice Roberts), start Jan 1 2017.

Example: The tuition at my school is 10K. Now lets mandate that every kid on the Cape has to enroll in my school. Lets further mandate that my school has to cover all sorts of new services (health clinics, free breakfast, psych counseling…) But not-to-worry.. the tuition is subsidized so that 10K tuition will only cost you 2K and you get all these great new services. What do you know?? Enrollment is booming at my school! What will the tuition bill be in 2017 when the subsidies expire? Parents are going to be wishing for the good-old-days when they weren’t mandated to enroll and the tuition was only 10K. This is why most analyst say that the ACA is not sustainable after the subsidies expire. (google: ACA-subsidies-expiration). Johnathan Gruber – the main architect of the ACA – said that the ACA is not sustainable and called the American people “stupid” for not seeing this (http://dailycaller.com/2014/12/30/obama-adviser-jonathan-gruber-in-2009-obamacare-will-not-be-affordable/).  And where will Mr. Obama be in 2017? Playing golf.


Economics Guy: In all those cases I want to be my own first line of defense.  If an attacker or an animal survives my defense (which can include nearby citizens), then the government (or a private entity that provides a similar service) can take appropriate action.
If I decide that I need help with an illness, I have the option to contract for that help with whomever I think can help me.  In my lifetime this is how it was.  You got sick, if you needed to see a doctor you paid him.  You only paid for what you needed.  Medical care was less costly before the government got involved.  (Everything was.  More on that to follow.)
It might seem like a good idea to have government agencies trying to identify and contain disease in general, and maybe it is.  The problem is that nobody ever asks “What will this cost?”  The other problem is that every government program expands and becomes a horribly inefficient bureaucracy.  The cost thing might sound callous, but it is an unfortunate reality.  Products and services are not free.  Somebody must produce products and services and that somebody wants something in return.
Economics 101:
Wealth is created, it is not distributed from some pre-existing stash.
Wealth is the availability of a standard of living higher than naked, alone and afraid, struggling to survive 24/7.
You want to eat?  Go find some berries, pick them, chew them and digest them.  You just produced one meal.
You want to get out of the rain?  Find a cave and defend it against the bear that comes looking for a den and a non-berry meal.  You just produced shelter.
You want a companion?  You have to offer her a better deal than the one she has.  Better companionship or more food or more comfortable shelter.
You see where this is going.  People enter into agreements to produce for each other.  The standard of living increases.  Infrastructure gets created.  It is all supported entirely by people who produce more than they consume.
Fast forward to 1776.  The colonists decide they are not happy with the British government.  They decide to create their own.  There are big government guys and small government guys.  We end up with a republic with a constitution that limits the federal government to very specific roles.  The government needs some amount of revenue.  It comes from taxes.  Taxes are the taking of some of the produce of the producers.  Almost everybody is on board with some amount of government and therefore taxes.  Government produced a producer-friendly environment the cost of which is taxes.
But the government starts to grow.  There are government people who keep thinking of new things the government can do.  It can do them because it can take from the current producers and borrow against what it will take from future producers.  Few in government ever ask if the government should do these things.  It is easy to spend other peoples money.  Some people like some of the things government does, other people like other things the government does, almost nobody likes all the things government does.  If you are a net producer you pay for it anyway.
How can we tell if we are producers?  Don’t government employees produce something?  Often government employees produce things.  Teachers teach, firefighters fight fires, researchers conduct research etc.  The litmus test is this:  Would a free market pay them to do what they do and how much?  Some people have always been willing to trade what they produce for what a teacher produces, or what a blacksmith produces or what a composer produces.  Can an artist produce enough art in a free market to live comfortably?  Good for him!  The list is endless.
But who will trade their produce for an IRS audit or for the NSA to spy on them?  Or for a bureaucrat to give some of their produce to a non-producer who could produce?
Today’s government is so bloated with bureaucracy that most of what producers produce goes to supporting the non-producing bureaucrats.  It is not that they don’t do what they are hired to do, it is that they shouldn’t have been hired to do it in the first place.  To make matters worse much of what bureaucrats do, make it harder for producers to produce.
Economics 102:
Economics is the study of incentives.
Costs rise or fall to match the supply with the demand.
When something costs less the market wants more of it.  When something costs more the market wants less of it.
Cost in this case is not just part of your produce.  It can be your freedom or your state of well being or pretty much anything you care about.
If you attend an event with an open bar you might drink more because you don’t have to trade your produce for it, your host has decided to trade his produce for your drink.  Or you might drink less because you don’t want to take advantage of your host.  In this case your cost is the idea that you are taking advantage of your host and that is a higher cost to you than your produce.
Our government routinely hides the true cost of things from us.  Piles and piles of red tape and taxes drive costs up while subsidies, tax breaks and special treatment drive costs down, sometimes on the same product.
Insurance was invented as a way to share economic risk.  A group of people who all face a more or less similar level of economic risk agree to create a pool of money to be paid out to those members who have an actual loss.  This works if the level of risk is relatively low over the life of the agreement.  Homeowners insurance is a good example.  You can’t afford to lose your $250K house and neither can most people so you all pay $500 a year to the insurance company who provides (produces) the organization to collect the pool and investigate and pay claims.  They probably get about 8% of the pool each year for this service, and everybody is happy.  It works because everybody faces about the same risk which is low, the incentives to try and cheat are small and the pool can pay the actual costs with enough left over for the insurance company to get its cut.
Health insurance is different.  Risk is affected by your lifestyle, your age and your genes.  Young, clean-living, hardy specimens don’t want to share the risk with broken-down old drug addicts.  Paying an insurance company $54 so they will pay for your $50 doctor visit doesn’t make a lot of sense.  A 60 year old man paying an insurance company for pre-natal care makes no sense at all.
Government medical care makes medical care look free or low cost.  When things cost less, people want more.  When demand goes up, actual costs (which are hidden from the consumer) go up.  This is why I said earlier that everything costs more when the government gets involved.  They can re-distribute the costs but they can’t make them go away.
The lowest possible costs and the most efficient solutions occur in a well informed, truly free market.  A true free market has never existed in America, but we were a lot closer in the past.
Obamacare (and every other government program) will benefit some people at the expense of many others.  This is socialism.  There is a limit to how much socialism we can afford.  There is no limit to how much wealth we can create.  Poor people in America today live better than kings and queens of yesterday.
Freedom creates wealth.  Socialism destroys wealth.
The bottom line: There are few if any things the government does that can’t be done better at lower cost by the free market.  (The real free market, not the government manipulated “free” market.)

Scary Anarchist:Allow me to pontificate.

1. I’d much rather mitigate risk from criminals, animals, nature by voluntarily entering into contracts with privatized for profit agencies than to be forced into conditions imposed by government.

2. “Where do you find these angels to run government.” Milton Friedman.


Limited Gov Guy:These are all excellent points, but I think I should have specified.

I am attempting to figure things out theoretically, in a vacuum of sorts, where the only considerations are individual freedoms versus collective security.
Many of your arguments are based on the impracticality and budgetary butchery of government work. I agree with all of these ideas, and perhaps they are your sole reasons for opposing the ACA.
But imagine a world in which the government could provide such services (police, corrections facilities, healthcare — all to protect the citizen’s right to life) just as efficiently as the private sector.
In this scenario, with numbers aside and the only factors being individual freedoms versus collective security, where do you draw the line?
I would be willing to pay taxes for the government to protect the public from criminals and wild animals, but not for them to protect us from disease.
The more I think about it, the more inconsistent it seems. Why do I pick and choose?
It seems the only reasonable progression is that government provides ALL services or NONE of them…

Economics Guy: Correct!  But does everybody need or want all the same services?  The only way government can provide anything at all is to first take it from somebody else.  If everybody wanted the exact same thing from government, and if government were efficient and had no agenda of its own, then it may indeed be the best way to provide those things.

But none of those things are true.

[My town] provides water and sewer service, collects the trash, has a school system, plows the roads, collects leaves in the fall, has curbside recycling, maintains parks and athletic fields and some other stuff.  Hopedale residents pay for this in the form of property taxes, which are high.  If you have a small lot, lots of kids, plenty of money and aren’t very handy then this is a good deal.  If you have a big lot that would support a septic system and a well, don’t generate a lot of trash, have no kids, don’t use the park and dump your leaves in the corner of your own property then you are getting screwed.  Your only option is to move.  If you stay in [my town] you are paying for stuff you don’t need or want.
On the federal level it is even worse, there are zillions of government programs that almost nobody would voluntarily support, and the option to move is more or less unrealistic.  So I come down on the side of very limited / no government.  This will preserve my freedom and a market WILL develop to serve people who want a higher level of service.

Joe Jarvis: I agree, it is much easier to consistently argue from the no government perspective. Then, it is a simple matter of not being robbed (in the form of taxes). Healthcare would be wrong, not necessarily because of what was provided, but because it was done by force. This is akin to how charity is no longer charity when you steal someone else’s money to donate.

Now our idea of limited government would be protection from foreign invaders essentially, and protection from being victimized by fellow citizens. In that sense the argument would be, if the USA is going to declare 3 million square miles “theirs,” then at least they have the responsibility to repel hordes and make sure they foster a safe environment within. But even this stands on shaky ground, because A) how do you pay for it without theft which is wrong, and B) how is it legitimate to claim land people already own, live on, work etc.?

If the answer to A is competing government agencies which you can defund by patronizing another one, that would seem to no longer fall under the definition of government; it would be more like a business. Yet that is exactly what would deliver the best results, as every other sector of the free market.

The competing agencies could team up in the event of a larger outside threat. Think of if every state’s police and national guard were privatized, had to find investors to buy back their equipment, and rebate the money to the taxpayers. Then they could start their own agencies, and the ones who provide a good enough service in the free market would still exist. The Colorado State Police, from what I hear, would do quite fine as a private company, due to the high quality service they provide to the public. People would still voluntarily pay for their policing activities, be it business owners, individuals, or road owners, because there is value in the product.
But I guess I am getting a bit off topic.

Scary Anarchist:Here’s a good barometer if you choose to put all other aspects aside.

Is it voluntary?

If taxes were voluntary would anybody pay them? If social security were voluntary only those who wanted it could CHOOSE to partake and pay into the system. What’s wrong with that? If police “protection” were optional, could I opt out of the system and provide my own protection? In fact isn’t this what we call privatization? Much of what we are subject to by govt. is deemed a “collective right” thus justifying it as a NON-voluntary system. If the system were option many who make their living off of thieving and controlling you and I would be out of a job. But what is a collective but a collection of individuals. I am an individual not a collective, who has different dreams, fears, hopes, wants, needs, then the next. The litmus test of all political theory for the libertarian minded is the championing of voluntary transactions and maximum individual liberty while upholding the non-aggression principal (NAP). Case and point: isn’t it good if we’re all forced to get immunization to keep deadly disease at bay (which beckons the question how are they going to force this)? This may be true but I would say NEGATIVE. Cannot subject individual liberty to this supposed “need” of the collective. If it’s truly a good idea than the market will uphold it. What is “the market” you say…. much to learn you have young Padoine!


Limited Gov Guy: I’m beginning to think that government should exert no control outside of a few necessary evils:
1) The Feds should defend our borders from other nations, and have almost no influence on American citizens themselves. This would require a federal tax, unfortunately. However, in order to preserve the freedoms inside our borders, I think I could bear a defense tax.
2) The States/counties/towns should deal with violations of rights among their residents. If one violates another’s rights to life or property (which I think are the two basic rights from which all others stem), then the government has a court system and a police force to deal with him. I also think that, at this lower level, government could own land for the sole purpose of selling it to any citizen who wanted it.
3) All else would be left to the free market.
I can’t say I completely buy into the anarchist mindset, even though I really enjoyed the ideas in Joey’s Anarchy in New England.
1) I’m not sure the private arbitration agencies could be trusted to agree upon verdicts impartially. I understand the idea that business ethics reviews would destroy such agencies if they made unjust rulings, but they might not all adhere to the same standards. What if there was a Muslim-run arbitration agency ruled that a thief ought to be beheaded?
2) And lastly, I think the lower-level government would have to own land and sell it to citizens. Otherwise, there would be no legitimacy to land ownership. Anybody could claim as much as they wanted, as long as they had more guns than the next guy.
Could the free market take care of such things?

Joe Jarvis: Yes, I believe the free market would take care of these things better than the government can. Competition and the profit motive are what will allow for this, while monopolies, including one on defense and conflict resolution, means no alternatives.

1) Currently Muslim run Governments dictate that thieves be beheaded (or witches, or woman drivers). An arbitration agency however would be competing with other ones. If I was a thief, and have representation, then it is likely that a Muslim agency would adjust their sentences to themselves avoid action against them. However if an entire region (customers) agreed thieves should be beheaded, the punishment would persist.
But the profit motive and competition means a draconian agency would have to justify their existence to customers, versus forcing customers to fund their “service” (the government). The fact is our current system is not impartial, and states/ towns do not have the same standards. An ounce of weed has landed people with life sentences in some states, while in MA it is a $100 fine. Any agency that tried to jail a man for life for possession of a plant would be opening a can of worms that would threaten their profits, and open up competition for rival, less crazy agencies.
And everyone would save money because a crime would require a victim. Currently the government steals our money, and labels things crimes, even if there is no victim. We are forced to pay to lock up non-violent drug offenders. But without government monopolizing security, consumers would balance service with cost. The best service (as decided by the consumers, who in a truly free market would also necessarily be producers) for the lowest cost would win out. War has high costs, and so does dishing out draconian sentences that people (your customers, or customers of rival agencies) will protest.
Is it possible for injustices to happen? Of course. But based on what we know about market forces, we have to assume the injustices would be fewer, farther between, and more easily righted outside of monopoly control.
And finally, we cannot take the best example of government, and act like all governments will be that way. Cliche, but look what Stalin, Hitler, and Mao’s governments did. Absolutely no private agency could afford to do that, get nearly as far, or survive the public backlash.
2) Land ownership is indeed important, and I think the structure would be slightly different without government, but no less just. First off, there is no private ownership of land currently. We rent it from local governments; the rent is called Property Tax. If you don’t pay your rent (property tax), they will eventually confiscate the land from you. The Feds can also confiscate your land according to the Constitution, and give you what they decide is the market price. How absurd: the market price is whatever I want to sell the land for. If I don’t want to sell, the price might go through the roof. If you want occupied/ owned land, pay for it what the owner asks, or move on.
So that is the price we pay for allowing government to control land ownership. Currently, the guys with the most guns indeed claim the most land. America claims 3 million square miles officially, and another 54 million square miles unofficially. I think I will trust the market to ensure that at least more than a few hundred governments own all the land on Earth.
It is not legitimate to claim land you do not use. I cannot say for sure how this would go down, as it would be different in different regions, however the consumers would still decide on what constitutes land ownership, just as they would dictate the laws through patronizing a security company that shares their values. This would give us true votes (with dollars) on what laws exist, as opposed to mob rule law as it currently stands.
If I owned a security company, I would agree to protect land that people use and/or improve. If you have a house, and a fence around your property that no neighbors dispute, then it is easy: register with your security company the land you want them to protect. If anyone else claims it, they will legitimize the fact that it is yours. Same if you build a factory: it does not magically belong to the workers. Absentee land ownership would be legitimate as long as his capital paid for the improvements on the land.
Does a random tree in the forest belong to you? No. But when you cut down the tree, mill the wood, and make a bar out of the tree, the bar belongs to you. Even if you cut down the tree and split it into logs, they belong to you. The berries on the bush belong to you once you pick them. And an unoccupied piece of land belongs to you if you add value by manipulating the natural resources.
Something not legitimate would be claiming Isolation Mountain as your own. No security company would agree to protect that land as yours, because it would threaten their public perception, and profits. In fact multiple New England agencies might even get together, and decide on large swaths of land they will never register to a single owner (in order to avoid later conflict, and thus save money). You could still go out and build a hut in the forest, grow a garden and in my opinion that would make the land your own.
Land ownership, in that sense, predates humans. Wolves understand the invading party to be in the wrong, and that invasion will most likely lead to mutual destruction, with a slightly higher possibility of the owner coming out on top, due to incentives to protect ones own property. It is possible, though less probable, the invading wolves win the land. But as I’ve already noted, the American wolf pack has already stolen your land. So it is a matter of collective ownership of all 3 million square miles (if you agree not to threaten the alfa male, you might be allowed to live on THEIR land for a relatively low cost, with some benefits, including other wolf packs not invading your land, but with the very distinct possibility of your own wolf pack cannibalizing you).
But you couldn’t simply claim an area you do not use as your own because: A) it would require the personel to protect it, in which case, you are adding value in a sense (providing jobs, and therefore using/ occupying the land). or B) if there are already people on the land, this is aggression on their property which the owner’s security should protect, and if you impose your will or take a tax from the people within the land your claim, you have just created a government.
The subject of land ownership really requires a book, but perhaps I will try to tackle it in a post. One thing I am sure of however, is that the free market will make for better rules of private ownership of land than the current monopoly provides.

One thought on “Emails: Debating Limited versus No Government

  1. Pingback: Not Perfect, Just Better | Joe Jarvis

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