How Police in Iceland Dealt With a Fight I Witnessed

Last week I was in Reykjavic, the capital of Iceland. The scenery and the people are just great, and so is a lot of their culture. People talk about the socialist aspects of Iceland and other Scandinavian countries, but whatever the detriments caused by their relatively big government for their population size, police brutality is not one of them.

Only one person has ever been killed by the police in Iceland, and he was shooting randomly from his apartment. I realize less densely populated areas generally have less crime as well, but even adjusting for population size and crime rates, American police would have been expected to have killed 1,000-3,000 people since the 1960’s; not over 1,000 each year as it currently stands.

The other night I witnessed the Icelandic police officers’ restraint in dealing with drunken idiots. In America, they would have filled up the paddy wagon, or worse. In Reykjavic, they appear to be more interested in diffusing situations, not escalating them.

First, there were multiple officers standing around dealing with some situation, and a very drunk viking was screaming at them in Icelandic. I assume he was saying something negative towards the police. The drunkard’s friends ushered him away, and calmed him down. The police did not even acknowledge him. This is called restraint, and American police should take note. Instead of acting like a rival street-gang and throwing the rude drunkard to the ground or murdering him for being intoxicated in public, they let his friends deal with him. I guess they don’t have as much to prove.

Then, I just so happened to be in the vicinity of a couple guys who started yelling at each other. I didn’t know what they were saying, and at first honestly thought they may have been joking around with each other. But they were not, and one ran over and tackled the other to the ground. Friends stepped in to make sure it didn’t get too bad. There were some punches and kicks, but I don’t think those involved even wanted to really inflict much damage. The fight had mostly been broken up by the time the police van (which had only been a block away) stopped and about eight Icelandic police calmly stepped out.

I think one of those involved in the fight had already departed the area quite quickly, but a few others involved were gently beckoned to the police so they could figure out what happened. After a couple minutes of talking, everyone was sent on their way. No arrests, no brutality, and no one, not even those who had been fighting, were really hurt.

In America, someone would have been arrested, and put through the ringer. In all likelihood they would have been tackled to the ground, leading to worse injuries than were sustained in the actual fight. Then the police would have lectured them about how violence isn’t the answer–unless you are the police. Then it is always the answer.

This is a simple anecdote that doesn’t prove much, it is just what I saw from the police in the safest country on earth, with practically non-existent police brutality. But maybe it shows that America needs to rethink how situations are handled. Are police here to actually keep peace, and diffuse situations as the Icelandic police did? I don’t think so. I think the majority of people who become police in the USA do so for dubious purposes. Instead of setting an example of how to act, they use their position to act however they want. And I think the majority of police departments are more interested in writing traffic tickets in order to increase their budgets.

That being said, the system of public police does not properly place the incentives to behave well, neither in Iceland nor in America. If police were private, then the company they work for would be able to be defunded if the customers went elsewhere. In order to maintain a good image, and protect their profits, companies would fire and even prosecute bad officers. Currently we cannot defund the police no matter how few crimes they solve, or how many innocent people they maim.

The smaller a government gets, the more control the market has, though still indirectly. And that is probably the real reason why the Icelandic police are pretty good, because they still somewhat feel market pressures that a private company would feel. In a country with 300,000 residents, you have more access to the President than Americans have to their representative, where districts include over 700,000 people for the smallest federal office.

And we see the same thing in America. Generally speaking, the worst atrocities committed by police happen in big cities where the people and the voters have essentially no control over their politicians, nor the people they hire, including the police. In small towns, people know the police chief, and can knock on their selectman’s door. The politicians are much more likely to feel the brunt of their bad hiring, or failure to address cases of police brutality.

Even things that are technically illegal victimless crimes in Iceland were not enforced. Apparently it is illegal to carry around a beer, but everyone was doing it, and the police did not hassle people over it; probably because they are their neighbors, friends, and relatives.

This is not a complicated issue. If we want police to behave appropriately, we must place the incentives properly. Private businesses have the incentive to make sure their officers respond with appropriate force, instead of looking for an excuse to escalate situations. Governments–especially big ones–have essentially no reason to enforce high standards among police.

Without Government, Who Would Build the Roads?

In the past I have discussed Anarcho-Capitalism, the system of organizing a society based on the free market instead of the government. I began by discussing that absent of government there would still be a market for protection, police, and crime investigation, and a free market would provide these things because profit would be available to those who supply security. I discussed how different security companies would interact to avoid chaos, and how based on the desire to live a happy, healthy life, the market (customers) would demand companies which avoid violence in favor of negotiations with other companies based on prewritten contracts, and eventually a third party “arbitration agency” which companies would use to avoid the costs of mini-war, and avoid violating their customers contracts. Essentially there would be a clause in everyone’s security company contract that says the company will not go to bat for you if you actually commit a crime. Since these companies have incentives to solve crimes, they would most likely perform their investigative jobs better than the government currently does.

If you are confused you might want to start by reading the first post I wrote on this subject. But what I wanted to talk about today is the fact that most people never even imagine a society without government. People mostly default to imaging a riot, burning buildings, looting criminals, and widespread death and destruction. This is a pavlovian response that has been conditioned by government and its agents (the media) throughout each of our lives. I started by talking about police because protection is one of our most base needs, so we default to wondering how we would be safe without government. But there are plenty of other things that government currently does, which would also be fulfilled in a free market society without government–and it would be done better because of the incentives a company has to provide a product based on demand, and turn a profit.

Think about the incentives politicians have to provide us with government benefits. Just their jobs, which many “useful idiot” voters provide them time and time again, despite poor performance. What if the entity that was responsible for building roads could go out of business if it did a bad job? In a free market, a better company would take its place. Currently we have to beg and plead for our government to correctly use our tax dollars in order to provide us with good roads. Too many of those dollars are siphoned off by greedy politicians, and well meaning but ineffective government programs.

People want roads, and other people want profits (we all want some degree of profit to get us the things we need in life, it is not a bad thing). The desire for profits makes some people respond to the demand for roads with a supply of roads. Since roads are shared by many people, you may think that the government needs to pay for them, so that everyone could use them. But why not cut out the middleman–the government–and just leave it to the people who need the roads most to build them? Maybe if you live on a dead end street with 3 other houses, you put up with a dirt road because who would be willing to pay for your road? Maybe you and your neighbors put your money together and pave your dirt road at some point.

But you might live on a busy street with businesses; businesses that want people to be able to access them on smooth well maintained roads. Problem solved, now the business payed for something that you will be able to benefit from. Maybe a shipping company teams up with other companies in the area who need to move their goods, and builds a highway. Since they don’t want their money wasted, they restrict access and make it a toll road. Other companies need to use the road, and decide to pay the toll–after all, they have the money to spend on things like tolls, because they don’t have to spend it on taxes. But if the tolls are too excessive, there will be a market for another road to be built in order to compete and drive prices for using the road down.

If the toll roads cause gridlock, road companies may start teaming up with each-other to sell subscriptions. “Subscribe to toll road A company and get access to all toll road B company roads!” because the two companies have a mutually beneficial agreement. “Subscribe to toll road C company now and 50 cents of every dollar you pay for the first 6 months will go towards buying cars for families in need”. “For one low price subscribe to the Toll Road Association and  get access to every road in the country”. The free market solves these types of things because there is profit to be gained in doing so. Since no one is forcefully restricted from competing, prices are driven down, and quality up by companies vying for your business. If you are dissatisfied with a company for any reason, there is always one waiting to take your business and give you what you want.

Its a useful exercise to consider different things which the government provides, and think about how they would be provided in a free market. If there is a market for charity, those charities will exist. Right now many people pay their taxes and assume they have contributed to helping others, but the government is really bad and inefficient at helping the poor and needy. Since we do not want to see people starve, be homeless, or left to their own devices if they are unable to take care of themselves, markets would arise to fulfill these things. With all the leftover money not going to government in taxes, people would be much more willing to throw some money towards charities. And even if they were not willing to give up their money to charity, companies that they patronize will see a profit in providing charity, because it attracts customers.

A restaurant may have a free meal program once a month for the hungry. A school would give out 20 scholarships a year subsidized by those enrolled at the school. A security company would offer protection to those who could not afford it, because their customers feel better about themselves when they contribute to society’s safety. The only difference is that these things would be done better, because they would have to be done better to compete. The government takes away the competition by force, and monopolizes certain industries and services, leaving us with no choice if we are not satisfied with the quality and price.

Everyday I hear about another private company dropping their healthcare coverage for part time workers or retirees, because the government has made it too expensive through regulation in Obamacare. At one point those companies decided to offer healthcare to their employees in order to attract and retain good workers, but the government stepped in and has ruined a good situation for a lot of people by using force in the economy. Give anarcho-capitalism some thought. Next time you use a vital government service, ask yourself if that service could be absorbed and improved by the free market. I think that in an honest assessment, you will find that incentives are the key to quality goods and services.

Looters Posing as Government: Part II

The solution to the economic crisis in Cyprus and the rest of the world is not going to come from government taxing the savings of their citizens. The only way for the world to climb out of this financial hole is a grassroots approach. The solution is the exact opposite of what just happened in Cyprus. When individuals are allowed to keep the products of their labor, whether gained through muscles or mind, is when the world will start to heal from the damage done by looting governments.

It is only the saver, the entrepreneur, and the technologist who move our society forward, and rule of law is exactly what allowed these people to come into being. When the saver knows that what he works for and puts into his account will not be stolen by the government, his neighbors or invading hordes, is when his bank account will grow large enough to support new technologies, innovations, products, advancements, companies and jobs. It is because his savings are not robbed that his money will work to benefit all of society. Had the government plundered his savings, there would be no societal advantage other than what can be forcibly accomplished with the crack of a whip at the end of a gun.

If every time Bill Gates saved a buck, the government took it, where would the capital to start Microsoft have come from? If every dollar Thomas Edison worked for was taken by the government for the “betterment of society”, would we still be sitting in the dark? And it is not just about resources going from the private sector to the government, it is about future wealth never being created, because why save something that will be stolen from you? Why, if you live in a bad neighborhood, save money in a jar if that jar is stolen once a month? If the message that government sends is that it is not worthwhile to work hard and save, fewer people will work hard and save.

Why were men finally able to create farms and grow crops? Because the government had a rule of law which was followed, that meant the farmer knew exactly how much of his crop would be given to the government before he grew it, and he knew that with that share of his wealth the government would protect him from foreign and domestic robbers who would otherwise take his harvest. Now imagine the government comes in after the harvest, and says extra crops will be taken that year. The rule of law has been breached, and the incentive to grow more crops than necessary has been crushed. That individual farmer may be fine with what he and his family can save, but now he has nothing to trade with his neighbor, or sell. This means it will be harder for people in the area who are not farmers to get food, because farmers only grow enough for their families, since otherwise the government takes it. Now, because the government ignored the rule of law, the wealth of the farmer and his region has been reduced, not only by the initial amount of food taken by the government, but also by curbing the future supply of food with their actions.

The same incentives exist behind the complicated markets of today’s economy. Cyprus cannot expect to attract investors, savers, or companies after implementing a savings tax, because people will not be guaranteed the fruits of their labor. The situation has greater implications since it was not the Cyprus government acting alone, but in coordination with the EU. This means that if you live in the European Union, you can not be sure that money in a savings account will not be taxed. To some this means moving money and investments out of the EU. To others it may mean investing in physical gold and a strong safe, which would damage the lending capabilities of the banks which used to hold the deposits that have been turned into gold. To many it means abandoning plans to start a new business, to expand a business, or to create new products, innovations and jobs. Why go through the grueling work of building a company, if what you work for could be taken by the government in the blink of an eye?

The rule of law has been breached by implementing a tax on what one has already earned, and already paid taxes on. No one could plan for this surprise tax, and when people were putting money into their accounts, they did not know about this tax. People in the EU can no longer be certain that what is theirs will stay theirs. The one time tax on savings in Cyprus will most likely have terrible economic repercussions for all of the EU, not because of the $7 billion taken in taxes, but because of the precedent set, the uncertainty created, and how people will act with their money in the future.