Didymos Thomas wrote:
Careful now. The current market, yes. The "market", ideally, no. Oil prices are also influenced by OPEC and the ability of corporations to artificially raise the price of oil. Basic economics, just of the sort that economists denounce.
... Just that the current price of oil is the market value. OPEC nations are producing at full capacity, as are non-OPEC nations.
It would be impossible to break the OPEC cartel without causing serious geopolitical harm by breaking up the governments that are the members of OPEC.
We could alleviate the problem by deregulating the oil market at home (i.e. drill in anwar), but the long term trend will be rising oil prices since we're on the downside of the supply curve in terms of peak oil.
I'm not sure bureaucrat really captures the nature of the job, but yes, I think some degree of regulation (and I use that term losely, lose enough to include aggressive public protest) would be useful. Of course, I'm not an economist and could very well be wrong - if my suggestion is not pragmatic, it should be discarded.
Isn't that precisely what we're debating?
The heart of our disagreement, I think, is that you see capitalism (vaguely) as necessarily pragmatic and I disagree. While I am extremely sympathetic to capitalism, the vast array of possible economic and social conditions suggest that we should not restrict ourselves to any idealic pursuits in economic policy and instead be open and sensitive to whatever conditions arise - and be willing to move against our ideals when those conditions call for us to compromise.
Different conditions don't require different economic policies.
The laws of supply and demand, marginal utility, Say's law, etc., etc. apply everywhere at all times. You can't say that "oh, conditions call for price controls NOW" or "conditions call for a profits tax NOW," as both, when looked at praxeologically, reveal that they are bad policies with negative effects.
Government doesn't have the right to do anything at all. However, if we are going to allow the government to handle economic policy in the first place then the government must be allowed to react to the economic environment.
The government is necessarily better at quantify values than the market place, but sometimes, in some cases, the government might be better. And in those cases, if we are going to have the government handle economic policy, the government should quantify those values.
You still have failed to provide one example of government being better able to quantify a value then the market could.
But a pure free market, the sort that would eradicate the economic woes you currently blame government pragmatism for, is impossible in a global economy without all nations applying pure free market economics.
Where do you get this idea from?
If only one nation applies a pure free market economy, it does not mean that it is not practical. Colonial Pennsylvania, for example, existed in a state of de facto anarchy for a very long time. No taxes, tariffs, duties, etc. were collected and no regulation existed. The only government agency was a lime monopoly imposed by William Penn (since he was unable to impose taxes).
Both Ireland and Iceland existed as anarchic systems temporarily in the middle ages. Pure free markets are feasible among government monopolies.
All persons are not bound to ultimate failure, though they do make mistakes. But the propensity for human mistakes is nothing that free market economics can avoid. Instead of governments messing up things for millions, corporations, wealthy individuals, the new concentrations of power will have the potential to mess things up for vast numbers.
No corporation or wealthy individual has the power to drive us into horrible business cycles like the Great Depression. Only government can mislead markets that far.
Well crafted governments are much easier to restrain than corporations and wealthy individuals which exist in a pure free market economy.
There is such a thing as a well crafted government?
Then you missed my point. Here it is again:
"Taxes and regulations can do as you say (or at least influence - property tax isn't the only factor in urban sprawl), but they do not necessarily do more harm than good."
Check the word 'necessarily'. I agreed that you are generally right, but not always. Taxes can and often are harmful, but sometimes they are more helpful than not. It comes down to circumstance. Of course, as long as our fundamental disagreement remains, I do not expect you to agree that pragmatic concerns sometimes trump idealistic rhetoric on how to handle the economy.
There is no idealistic rhetoric on my side, it is entirely on your side. YOU are the one who assumes that government can play the role of perfect regulator, guiding the economy. This is simply not possible.
Everything the government does is simply a misallocation of resources. Every time you tax the economy, you are distorting price mechanisms and signals, and thus creating an unwanted byproduct in the economy. You are also preventing maximum efficiency from occurring since the money taken out of the economy would have been used in a different manner that actually represents the millions of subjective values that people place on different products.
The only tax that could ever do any good would be the carbon tax, but only if we agreed with the premise that anthrogenic global warming is an actual threat. And the only reason it would do any good would be that it would actually work towards fixing the price mechanism in a market to properly show the costs of emitting carbon.
In the case of Ricardo, he didn't merely think capital was immobile, his arguments for comparative advantage were premised in the fact that capital was, to a large extent, immobile.
Yes, I've heard that, and I've already responded to that two or three times.
Mobility of capital is entirely irrelevant, reread my previous posts please.
The problem of a global market is that we have to deal with all nations, and all of the world's capital at once, instead of simply that of England and Portugal.
It doesn't matter, as I already mentioned, the entire equation becomes much more complex as the economies of scale get larger. But the same principle applies: resources will be allocated in the most efficient manner to meet demand.
Like it or not, there are protectionist nations, there are nations willing to use all sorts of dirty tricks to promote their own economic advantage.
You mean to promote their own economic disadvantage?
Maybe you can help me with this one. If comparative advantage works in today's global market, how do we end up with cheaper, lower qualty products instead of cheaper, higher quality products?
Are Toyotas and Hondas of lower quality?
Your question is just ridiculous, and nothing more. If people desire cheaper, lower quality products, and foreign nations can provide those cheaper, lower quality products, then that is a good thing. That means that there is a demand for something that can only be met by free trade.
And don't tell me that France has inferior wine, Germany has inferior beer, and Russia, Sweden, and Poland have inferior vodka to American products. Tariffs would only cause a higher price for these products, meaning a demand would not be met.
As I see it, protectionism is a huge part of the problem - simple merchantilism on the part of all parties involved. Pushing for a world in which all nations adopt pure free trade is clearly a pipe dream. So, when we set economic policy for whatever nation we live in, we must accept that other nations will have different policies, crafted for their own advantage with the intention of disadvantaging our nation.
Again, tariffs don't actually advantage anyone. But you can still abolish all quotas, duties, tariffs, and taxes with another nation if they still keep up their tariffs, quotas, etc. They are simply disadvantaging themselves by preventing maximum efficiency in their own economies.
But what happens when we interject China and large corporation X? China will produce wine and textiles, of lower quality, but at much lower prices than either England or France. Meanwhile, corporation X will sell the cheaper, lower quality goods at prices the English and French cannot match. X also has vast marketing resources, able to advertise the Chinese goods, which seems to make up for low quality in the eyes of consumers.
What's inherently wrong with that? Corporation X (what a sinister name) and China have met a demand for consumers. Consumers wanted a cheaper product, even if it was of inferior quality, and Corporation X and China were able to provide that cheaper product.
The result, that I foresee, is that the English and French go out of business, unable to keep up with the super low prices offered by X and the cheaper Chinese products.
And that is a very, very good thing. It's simply the market at work, allocating resources in the most efficient manner so that those resources could meet the demands of consumers.
The workers in England and France would rather quickly be picked up by other businesses that need the extra labor due to shifting consumer preferences.
These sorts of arguments may work well on paper when you attempt to extrapolate from economic ideals into morality, but when confronted with a halfway decent human being these arguments amount to ad hominem attacks.
So should your side of the street have tariffs against the other side or what?
I'm saying that we cannot always change the cast of those living far away. I'm saying that governments tend to exert influence over a certain area and not beyond that area - and we are talking about governments. I'm saying that if we are going to talk about what some government should do, we cannot expect that government to solve the whole world's problems. Instead, we should expect that government to make pragmatic and responsible economic decisions for the people that government represents. Did I say the government should abuse the rest of the world for the sake of the people said government represents? No, I didn't.
Clearly, tariffs aren't a very pragmatic decision.
A pure free market is impossible.
What an ingenious broad statement meant to distract me from what my original question was.
Please, please do provide one example of a piece of regulation that works. Go ahead.
Right, because that's the only event that took place. The government did not repeal lending regulations or anythng like that, right? Come on now.
Again, the burden of proof falls on you.
What lending regulations did the government repeal and how did they contribute to the recent economic downturn?
If at time A, action X is best, and then at time B, action Y is best, I suggest at time A we take X action and at time B we take Y action.
Doing otherwise is just plain dumb.
Just that action x = action y = deregulation.
Again, regulation only serves to distort the price mechanism and reduce competition, which always a negative thing.
Absolutely. And again, this is beside the point. No corporation is perfect, no human being is perfect. No one is perfect. If you don't like my shirt because the shirt is red, and then suggest I try a different red shirt, I'm going to give you a funny look. I'm giving you that same funny look right now.
You seem to look past the problem. When the government screws you over, you can't give your business to another government, that is treason, and the government does lose market share due to bad decisions. The government is a monopoly and it has a 100% market share at all times. It does not feel the bad consequences of its actions, whereas a business that screws you or anyone else over loses market share and could eventually be forced out of business all together if it keeps on making bad decisions.
And again, a pure free market is idealistic and impossible. Such a thing would require all nations to adopt pure free market economics. Chasing ideals does not work.
You have again failed to show how a pure free market is impossible amidst nations with no free market.
And you're again ignoring what you yourself quoted. The least you could do is admit that large tariffs and regulating agencies prior to the turn of the 20th century were not laissez fair.
Standard Oil is an extreme case. As with governments, size does not determine the scope of corruption, only the mass of corruption.
And how is this relevant to what we're discussing. If a business is not supplying an inferior product it will lose market share and go out of business. There is no such market correction for governments.
I don't know - if China's economic policy is to ship artificially cheap products to the US with the goal of destroying a particular sector of the US economy, the US better damn well make an economic policy - otherwise, that industry is going under.
So? If China is subsidizing an industry for the sole reason to provide us with cheap goods, you should be more than happy. A foreign government is taxing its own people to provide you with cheaper products. That's pretty ****ing awesome, man.
So? The Fed exists, and we still need some economic policy. At the time, the deregulation was bad policy. Maybe had we done away with the Fed, but we haven't.
You're essentially agreeing with me here that the Fed needs to be abolished or that, at the very least, different currencies need to be able to compete with the US dollar within our own borders without taxation or regulation.
Then don't take me seriously. Lord knows it makes no difference to me.
If you can't provide actual examples of what you're talking about you shouldn't expect anyone
to take you seriously.
Cute. Except that empiricism is all we have.
Just that the science of economics is based on a priori statements, not empirical observations.
Enough of a demand for politicians to change the law, but not enough for the 'market' to hanlde the problem?
Yeah, it's called large businesses calling for entry fees and regressive regulation (all regulation is regressive) so that smaller businesses cannot compete.
Special interests make politicians' pockets very, very deep.
These chartlatans didn't want to be honest and up front because doing so would destroy their industry. Mislabeling occured, but more often than not, ingrediants were simply not listed.
If people were actually concerned with what were in the food products they bought they would've demanded more product transparency. Also, government reformed tort laws prevented consumers from suing someone who cheated you with food labels.
You can go on all day about how a pure free market would have solved the problem, but a pure free market is impossible.
If you say something long enough, does it make that statement true?
You're pulling nails out of the board, brother.
I'm a huge fan of you, Hulk Hogan.
The PFDA didn't tell consumers how to spend their money, it directed companies to properly label their products.
The government took money away from taxpayers (consumers) so that it could redirect it to "protect consumers" from themselves. Yes, the PFDA told consumers how to spend their money - or maybe it coerced them to do so.
I for one think the government was wise to allow the people to know what exactly we are spending our money on, and wise to usurp the corporate interests who suffered because of the increased information available to the public.
You mean it was wise to take away money from consumers about something they didn't really care about and then to decrease competition by imposing regulation and taxation in an industry?
Overall, in your post, I see the same kind of disbelief that you had earlier in the libertarianism as utilitarian debate. You just cannot comprehend that regulation and taxation have mostly negative effects.