Caplan on Economic Ignorance and Public Choice

by Don Boudreaux on May 12, 2007

in Politics

My colleague Bryan Caplan has a very nice op-ed in today’s Wall Street Journal.  In it, Bryan brings more richness and rigor to the familiar story of special-interest-group politics.  In short, Bryan argues that widespread ignorance — especially ignorance of economics — provides necessary fertilization for the growth and spread of harmful interest-group policies.

Here’s the gist:

Unfortunately, most people resist even the most basic
lessons of economics. As every introductory teacher of the subject
knows, students are not blank slates. On the first day of class, they
arrive with strong — and usually misguided — beliefs about economics.
Convincing students to rethink their anti-market views is no easy task.

The principles of economics are intellectually
compelling; but emotionally, they fall flat. It feels better to believe
that greedy intentions imply bad consequences, that foreigners destroy
our prosperity and that price controls are a harmless way to transfer
income. Given these economic prejudices, we should expect policies like
steel tariffs, farm subsidies and the minimum wage to be popular.

None of this means that special interests don’t
matter, but it does put their activities in a new light. Special
interests do not have to sneak behind the majority’s back; they just
need to ask for the right favor in the right way. The steel lobby could
have demanded a big handout from the federal government. But that would
have struck many voters as welfare for the rich; steel-makers can’t
expect the same treatment as farmers, can they? Instead, the steel
lobby took the crowd-pleasing route of blaming foreigners and asking
for tariffs. Tariffs were less direct than a naked subsidy from
Washington, but they enriched the steel industry without alienating the
majority.

If special-interest legislation were fundamentally
unpopular, public relations campaigns would be futile. They would serve
only to warn taxpayers about plans to pick their pockets. Since the
public shares interest groups’ critique of the free market, however,
there is room for persuasion. Left to its own devices, the public is
unlikely to spontaneously fret about the plight of the steel industry.
But a good public relations campaign can — and often does — change
the public’s mind. Once the public actively supports an interest group,
even politicians who would prefer to leave the market alone find it
awkward to block government intervention.

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True_Liberal May 12, 2007 at 10:49 am

Excellent summary from Bryan.

But it makes one ponder about the effect of patents and copyrights in the marketplace. Few would argue their usefulness in rewarding creativity, but in doing so they provide a Constitutionally-protected exclusionary trade zone.

A patent's protection extends to 17 years, which has stood the test of reasonableness.

A copyright is far far longer under current law, which was enacted under pressure from Disney, etc. There is an argument that maybe US patent and copyright laws should be more equal in duration, or even that they have it backwards.

M. Hodak May 12, 2007 at 11:21 am

I think we're finally seeing a greater awareness that the collectivist instinct is nurtured at a young age in our schools. We can't just blame the socialized school system, either–private schools are at least as bad.

I'm sure Dr. Boudreaux has thought about this longer than I have, so maybe he can suggest as a solution. Right now, it seems that the classical liberal movement is largely dependent on the occasional kid coming across Atlas Shrugged, or having parents who'll send them to a FEE class (which is almost redundant).

Sam Grove May 12, 2007 at 4:04 pm

My neighbor was speaking in defense of a minimum wage. I asked him if I was willing to work for him for $3.25 and hour (well below min. wage) who else's business was it? His reply: "Nobody."

muirgeo May 12, 2007 at 4:53 pm

I've always argued against Libertarian economic position because IMO basically it places an economic system ("free market" capitalism) above our form of government (democracy or Representative Republic if that makes some feel better).

I'm reading Bryan Caplans book now and was amazed to see he seems to admit as much.

As I understand it Edmund Burke seemed to believe as well that the general public was not worthy of self rule.

And that's where Libertarianism seems on a Quixotic quest. Short of convincing the majority that their system is the best they have to win in a Democratic system through deception.

In other words if Caplan is right and the voters are too ignorant the very idea of Burkes seems against the basic principles of liberty and freedom.

Seems to me the only hope of the Libertarian is 1, to have truth on his side and 2, to convince the public so. But of all the developed counties none present nor past has ever run on these principals as far as I know.

muirgeo May 12, 2007 at 5:13 pm

Here's another thing that makes Libertarianism seem superfluous in my opinion. The answer to getting special interest out of getting special legislation is to make all lobbying illegal and to hold publicly funded elections. Politicians need to be isolated from conflicts of interest in any and every way possible.

Unless you're willing to consider such legislation those very free market systems you love will see the treasury and legislature as Willie Sutton saw banks. And the system like a corrupted computer program will fail every single time.

So I can't wait to read to Caplans solution. But of course the science projects are do this week so reading time is sparse.

Russell Hanneken May 12, 2007 at 7:05 pm

Caplan's complaint is not that voters are ignorant. According to him, "rational ignorance" fails to explain why democracies choose bad policies. The basic problem, Caplan says, is that voters are irrational–biased against the truth.

This claim will come as a shock to his fellow economists; according to the prevailing ethic in economics, if you invoke irrationality as an explanation for people's behavior, you're just being lazy.

But Caplan does a good job of defending his claim empirically, and he also offers a way to integrate irrationality with conventional economic theory: his concept of "rational irrationality."

The gist of it is this: when people select their beliefs, they care about whether a belief is true, but they also care about whether it feels good. When the price of being wrong is high, they tend to be rational. When the price of being wrong is low, they tend to indulge their craving for feel-good belief–i.e., they are irrational.

For each individual voter, the expected price of being wrong is low, because his or her vote is extremely unlikely to effect the outcome of an election. So voters tend to believe what feels good to them. Unfortunately (perhaps because of social environment in which people evolved?) there is a human tendency to distrust the market, distrust foreigners, underestimate the benefits of conserving labor, and be pessimistic about the economy. So policies based on feel-good beliefs tend to be socially harmful, even though it doesn't cost the individual voter much to indulge himself.

People who criticize democracy because of "rational ignorance" believe the problem with democracy is that it allows politicians to get away with policies the majority of voters don't want. Caplan's position, in contrast, is that the problem with democracy is that it does give the majority of voters what they want. The main solution, in his view, is to allow more decisions to be made in the market instead of the voting booth.

The Cynical Libertarian May 12, 2007 at 7:17 pm

Libertarianism is a fairly broad idea (just like 'leftism' or 'rightism') but I can share my thoguhts on my own brand of libertarianism (granted my thoughts were developed before I even knew what a libertarian was, in the dark you might say, but since reading about libertarianism I can say I pretty much fit into that category).

Libertarianism rejects the idea that majority rule is always correct and thus should not have absolute power. For instance, a majority of people were in favour of slavery in years passed, but this does not mean slavery should have continued. If a majority of people in a country believe that a minority ethnic group is evil and should be eradicated, this does not make such action legitimate.

Therefore, there must be constraints laid upon the government (which is, via representation, run by majority rule) so that a 'dictatorship of the majority' is not possible.

A representetive, constitutional republic, like the USA, is not averse to libertarianism – it already has a constitution limiting government from taking certain actions, even if a majority demands such action.

Russell Hanneken May 12, 2007 at 7:26 pm

muirgeo, the traditional libertarian solution to special interest lobbying is to reduce the payoff. When politicians have less power, they have less to sell to special interests.

Abrogating the right of citizens to petition their government, as you propose, seems like a less attractive solution. Your other solution–giving government the power to decide who can run for election, by controlling the purse strings for everyone's campaigns–seems even worse.

In any case, as Caplan points out, legislation favoring special interests is actually popular. So the fundamental problem may be the voters themselves, not the special interests or even the politicians.

Ken May 12, 2007 at 7:55 pm

The supposed conflict between libertarianism and "our form of government" depends very heavily on exactly what one means by the latter. If it means the form of government that exists in the US today, I'd agree there's a serious conflict. If, on the other hand, it means the form of government spelled out in the Constitution there's very little conflict. The problem is that the Interstate Commerce Clause has been distorted to mean that the federal government has the authority to control anything or any one that could conceivably move across a state line. Limiting it to actual commerce would remove the clear majority of federal laws and eliminate probably 90% of federal domestic spending. Take that away, and there's a lot less to be gained by any special interest.

Sam Grove May 12, 2007 at 8:01 pm

And that's where Libertarianism seems on a Quixotic quest. Short of convincing the majority that their system is the best they have to win in a Democratic system through deception.

How would the public feel about being deceived, and what would they do about it next election?

The answer to getting special interest out of getting special legislation is to make all lobbying illegal and to hold publicly funded elections. Politicians need to be isolated from conflicts of interest in any and every way possible.

Thi seems a quixotic goal. Politicians are human, special interests are humans, elections cost money, ergo, money will flow.

The root of the problem is a government with the capacity and authority to make "special" legislation. The solution is to take from government (politicians and bureaucrats) the power and authority to pass special legislation.

The key to the solution is an informed electorate.

Seems like a dauntless task.

TGGP May 12, 2007 at 10:33 pm

the very idea of Burkes seems against the basic principles of liberty and freedom

I don't understand what you are trying to say. Is it that Libertarians, Burke, or the democratic majority don't actually like "liberty and freedom"? Caplan seems to be saying the last of these.

Russell Nelson May 13, 2007 at 12:59 am

muirgeo says basically [libertarianism] places an economic system ("free market" capitalism) above our form of government

You're thinking about this the wrong way. Think of it instead as "continuous voting with one's dollars" rather than "voting every couple of years". You may think that this gives rich people too much of a vote, but, how many apples does a rich person buy relative to a middle class person? Probably no more than 1.2. Substitute in any other commodity for apples. On the other hand, rich people completely dictate the market for yachts and the middle class has little to no market power. But isn't that how it should be?

muirgeo also says The answer to getting special interest out of getting special legislation is to make all lobbying illegal and to hold publicly funded elections.

An alternative is to not allow a government to interfere with markets. Governments can buy things; sure. But they can't interfere with transactions to which they aren't a party. Companies would still seek to influence government, but only to the extent that government is a customer. What could be wrong with that?

Russell Nelson May 13, 2007 at 1:07 am

True_Liberal posits that Few would argue [patents and copyrights] usefulness in rewarding creativity. Actually, the better informed one is, the more one argues against their usefulness. For example, Don Lancaster makes exactly that argument in his book The Case Against Patents : Selected Reprints from "Midnight Engineering" & "Nuts & Volts" Magazines (Synergetics Press, January 1996). Paperback ISBN 1-882193-71-7. Other people argue against copyright. Was Sonny Bono incented to create new works when his copyright was extended after his death? Are music artists incented to create new works when music companies underpay their royalties?

Jim Dew May 13, 2007 at 5:51 am

Special interests have a strong incentive to package their message in an emotionally compelling way. Economists package their message in a boring and intellectually demanding way. Given the low level of public interest, the emotional message will usually prevail. While the constraints on government action limit the damage, the tide will not turn until someone is motivated to package sound economics in an emotionally compelling package. And there is little incentive to do so.

muirgeo May 13, 2007 at 8:42 am

Companies would still seek to influence government, but only to the extent that government is a customer. What could be wrong with that?

Posted by: Russell Nelson

How does less government "interference" make the government any less a good customer for those who vote with their excess dollars?
I'd argue some companies that make weapons and some other companies that sell oil may find common interest in the government spending half a trillion dollars of the tax payers money promoting their products. Having a President , a Vice President and a Secretary of State deeply invested in said product could pose a bit of a conflict of interest with out a single dollar passing hands between them. But indeed many dollars do pass between them, many votes are bought and rich people do dictate the market for not just their yachts but also for their oil wells and their bomb making plants.

And you think less oversight will improve this sort of situation? I don't see how. I'm a doctor and if I take as much as a "too" fancy pen from a pharmacy representative my license could be in jeopardy. Dollars between special interest and politicians are not votes but conflicts of interest and bribery that should not be allowed. And such "rules" would not stop my pen one bit from petitioning my representatives as it would not stop the CEO's of Exxon-Mobile….only my message would make more sense .

muirgeo May 13, 2007 at 9:03 am

muirgeo, the traditional libertarian solution to special interest lobbying is to reduce the payoff. When politicians have less power, they have less to sell to special interests.

Posted by: Russell Hanneken

I guess I'm missing how that works. Because in the real world it seems the politicians power comes from monied special interest who get them elected not from their ability to legislate. You can't legilate if you are not first elected. The money IS their power that gets them elected and THEN comes the favorable spending and legislation. Best to let The People elect their representatives and not money.

The monopolied wealthy love regulation and they love the tax code and they love paying politicians to keep things the way they are. The government IS their best customer. When you're on top you don't care about free markets and democracy.

I stand by my point…corruption of markets comes from allowing our government to become a part of those free markets. The government is the government, the market is the market and religion is religion….DON'T let them mix.

David P. Graf May 13, 2007 at 9:46 am

Speaking of ignorance, I realize now through reading the posts on this site that I do not know as much as I thought I did about economics. I would be very grateful if more knowledgeable people on this board could recommend to me some good introductory books on the subject. Thanks in advance!

The Cynical Libertarian May 13, 2007 at 12:16 pm

The conclusion of my A level coursework (I believe this is a predominantly American blog: A levels are the courses we do at college) was that copyright laws were both unjust and uneconomical. It got an A which I was most suprised at, having a very left wing economics curriculum (can you believe I was taught the Phillips curve as fact???). I'd be happy to email a copy to anyone who might be interested, though I doubt very much anyone will be :P

Russell Hanneken May 13, 2007 at 12:41 pm

muirgeo, when people offer politicians a bribe, they expect something in return. This is true whether the bribe is offered before or after the politician is elected. Elected officials have only one thing to offer in return: the exercise of power.

The more limited an official's power is, the less he has to offer in return for the bribe. The less he has to offer, the less valuable he is to monied interests, and the less bribery will take place.

Campaigning does cost money. You can't run for President by standing on a street corner. And you can't make it hard for rich people to influence government without simultaneously making it even harder for poor people–who have fewer resources to work the system–to influence government.

Vidyohs May 13, 2007 at 2:28 pm

muirego,
you wrote:
"guess I'm missing how that works. Because in the real world it seems the politicians power comes from monied special interest who get them elected not from their ability to legislate. You can't legilate if you are not first elected. The money IS their power that gets them elected and THEN comes the favorable spending and legislation. Best to let The People elect their representatives and not money."

You're right, you are missing the points and I don't think you want to see the points. You know what you don't know and you will stick with it.

Money is not the largest factor in getting elected. Pandering to fools is. If money and reason were the factors we would have had President Ross Perot in 1992 instead of Billary Clinton.

It is no mystery why economics professors see new classes of student who are socialist in belief when they arrive in college, hell they have only had that cr@p pounded into them since birth by the socialist MSM, their education system, and virtually every avenue of entertainment that have been able to access. Socialist enculturation, indoctrination, and inculcation is the answer.

vidyohs May 13, 2007 at 2:47 pm

Yeah, I'm back. I don't know about the rest of you folks but people like this muirego just blow me away with their socialist minds like concrete, all mixed up and permanently set.

His/her first post denigrated Libertarians for wanting to put a Market/capitalist system before government. Well, no lie, muirego, seems pretty intelligent to me.

Your beloved government needs money to run and money to steal so it can give it away to the "takers" of society. Where is that money going to come from if not from a market/capitalist system? I haven't seen a socialist nation in history that did not slowly sink into poverty because they put government before "making/creating" wealth.

I am a market person, a capiltist to the core, and I never once in my long life ever got out of bed in the morning and thought, "Well, I need to pay a share of that medicare package Congress gave to "takers", so I'd better go make and sell goods today.

I get out of bed and go to create for one reason and one reason only and that is to increase my own personal wealth, and I expect every other swinging d!ck out there to do the same thing. I won't come to take yours and you stay the hell away from mine.

I think nature places one obligation on me and that is to bury your body when your unwillingness to "make/create" causes your starvation, but not out of affection or relationship but because your rotting body would be a health hazard.

Is that plain enough for you, muirego.

Take your socialism and its sickness somewhere else, like France for instance. They love a good "taker" there.

Flash Gordon May 13, 2007 at 4:18 pm

David P. Graf: Great question. Here you go:

Economics in One Lesson by Henry Hazlitt
Basic Economics by Thomas Sowell
Applied Economics by Thomas Sowell
Classical Economics Revisited by Thomas Sowell
On the Wealth of Nations by P.J. O'Rourke
The Economic Way of Thinking by Heyne, Boettke and Prychiitko
Guide to the Perfect Latin American Idiot by Alvaro Vargas Llosa
The Mystery of Capital by Hernando De Soto
Reviving the Invisible Hand by Deepak Lal
How Capitalism Saved America by Thomas J. DiLorenzo
The Road to Serfdom by F.A. Hayak
The Constitution of Liberty by F.A. Hayak

I put Hayak last but I read those first. Maybe you should too. Reading those books will of course give you references to many more. Looks like you'll need a good hammock for the summer. Have fun!

PS: I'm not an economist, just a reader.

Flash Gordon May 13, 2007 at 4:28 pm

David Graf, gee I left out Hayak's best.

It's Law, Legislation and Liberty.
Vol. 1, Rules and Order;
Vol.2, The Mirage of Social Justice, and
Vol.3, The Political Order of a Free People.

Each volume is a little under 200 pages in most printings. Don't be intimidated. It's easy and fun to read, maybe not as easy to fully grasp but entirely doable by a smart guy such as yourself.

TGGP May 13, 2007 at 5:30 pm

muirgeo, your view of politics as the result of sinister self-interested folks is simply wrong. If only that were the case. However, the government is full of idiots and nut-jobs who are killing us for "our own good". Regarding Iraq and oil, if you don't trust me read Michael Neumann in Counterpunch.

Ask yourself "Has there ever been a time when there wasn't money in politics"? Read Freakonomics. There isn't much evidence that having more money actually gets candidates elected, as opposed to candidates more likely to get elected being given more money.

David P. Graf May 13, 2007 at 6:35 pm

Flash – thanks for the suggestions. I went to Amazon to get Hazlitt's book and they paired it together with Hayek's "The Road to Serfdom" book at a discount and so I ordered both of them. I'll go through them and see what they have to say.

Flash Gordon May 13, 2007 at 7:20 pm

David Graf–I'd say that's as good a start as you'll find. Note the original copyright on Hayak is 1944 and for Hazlitt it's 1946. They're both classics that have stood the test of time. I don't think either of them has ever been out of print.

Flash Gordon May 13, 2007 at 7:27 pm

Muirgeo–you might like reading Alvaro Varga Llosa's "Guide to the Perfect Latin American Idiot." I'm not implying that you are an idiot, the idiots in the book are mostly politicians, but Latin America is pretty much a mess because of the politicians who have won elections from voters who think a lot like you do.

John May 13, 2007 at 7:50 pm

Muirgeo,

This what is meant by irrational ignorance. The cheap, "feel good" answer is that it's the fault of markets and money. But, aside from charity, money, if you notice, and capital is never willingly invested in something without financial incentive. There has to be the promise of a bigger gain over the investment.

What's government worth? Well, look at how much deep pocketed sources spend. They aren't doing it for nothing.

If the lottery suddenly started paying 1 to 1, how many people would have the INCENTIVE to play??

vidyohs May 13, 2007 at 8:23 pm

Alvaro Varga Llosa's "Guide to the Perfect Latin American Idiot."

Flash Gordon, great book.

To this suggestion, and for day to day reading, I would suggest to all out socialist idiot friends two magazines:
Reason Magazine
and
Liberty Magazine.

Both have on-line wensites and can be found simply by typing "Reason Magazine" or
"liberty Magazine" in the GOOGLE seach.

I wouldn't trade my wife for those two magazines, but I'd have to think about the kids.

Mr. Econotarian May 14, 2007 at 12:14 am

I am concerned that Libertarianism itsself is often sold as a a "feel good" philosophy rather than a means to maximize economic growth.

Infact some elements of Libertarianism may be at odds with actual results from economics (gold bugism and lack of strong institutions are my main concerns).

Sam Grove May 14, 2007 at 1:09 am

To illustrate the difference between economic power (the marxist bogeyman)and political power, remember that the USSR basically abolished private ownership of, well, everything, but in particular, business…and profits. Nonetheless, people were even more oppressed than when there was privete ownership.

The reason political power trumps economic power it the same reason a wealthy man hands over his wallet to an armed mugger.

When you get that, you'll have got it.

muirgeo May 14, 2007 at 2:00 am

muirgeo, when people offer politicians a bribe, they expect something in return. This is true whether the bribe is offered before or after the politician is elected. Elected officials have only one thing to offer in return: the exercise of power.

Posted by: Russell Hanneken

So don't worry about bribery? But instead weaken the officials who are sent to Washington to represent the people. First, how do you plan on doing that constitutionally? Second, thats my point of Libertarianism. Take power away from the electorate in favor of Corporations and businesses. Placing Capitalism above Democracy.

And if you are going to OK the indirect bribery of lobbyist and campaign donations why not make it legal for people and corporations to pay politicians directly to pass bills and legislation they want?

muirgeo May 14, 2007 at 2:23 am

muirgeo, your view of politics as the result of sinister self-interested folks is simply wrong.

Posted by: TGGP

Really? Ken Lay, Michael Millken, Arthur Andersen, Jack Abramoff, Duke Cunningham, Michael Scanlon, Bob Ney…that's off the top of my head. The last six years have been nothing but scandal.

Ask yourself "Has there ever been a time when there wasn't money in politics"?

Posted by: TGGP

No there hasn't. So why not try something new?

muirgeo May 14, 2007 at 2:27 am

Muirgeo–you might like reading Alvaro Varga Llosa's "Guide to the Perfect Latin American Idiot."

Posted by: Flash Gordon

Flash,

That's typically my reply to Libertarians. Mexico has fewer regulations and lower taxes. Is that the way we want to go?

Russell Hanneken May 14, 2007 at 11:04 am

muirgeo, my point is not that bribery is nothing to worry about. My point is that "weaken[ing] the officials who are sent to Washington to represent the people" is an effective way to decrease the incidence of bribery.

Weakening the power of public officials is easy to do Constitutionally, since most of what government does today is not actually authorized by the Constitution. As a libertarian, I of course think that scaling back the size and scope of government is a good thing to do in any case–the fact that it would reduce bribery is a bonus. You of course may disagree.

In the absence of special favors from government–the only institution recognized as having a legitimate power to coerce and expropriate–the only power businesses and corporations have is the power to create goods and services and offer them to people–or withhold them if terms of exchange cannot be agreed on.

muirgeo May 14, 2007 at 11:30 am

…"the only power businesses and corporations have is the power to create goods and services and offer them to people–"

Posted by: Russell Hanneken

Not to belabor my point but don't forget they have the power to buy politicians and favorable legislation. And i can't think of a senario where legislators could be so "weakened " as to have nothing to offer.

Russell Hanneken May 14, 2007 at 12:39 pm

muirgeo, as long as politicians have some power, they will have something to offer in exchange for a bribe. But it makes a difference how much power a politician has. When government has vast powers to push people around and take their money, people will spend vast amounts of money to capture that power–to wield it against others, or to protect themselves against others who would wield it.

You do raise a good point, however. I've been saying that if government is effectively limited, public officials will have less power to sell, and others will have less incentive to pay for it. But can government remain effectively limited if politicians decide how much power they have, and others are willing to pay to expand its power? I'm skeptical.

The problem is not, as you seem to think, that politicians want to stop bribery but lack the power to do it. Politicians are individuals who will follow their own interests–not the interests of "the people." In other words, they are human beings–just like the people in business. If government corruption is in the interests of the businesses who benefit from it, it is equally in the interest of the politicians who benefit from it.

Even when they pass laws ostensibly to stem corruption, they rig the rules to their own benefit. As you may have noticed, campaign finance laws have been used to silence criticism of the government–e.g., Michael Moore's film _Fahrenheit 9/11_ couldn't be advertised shortly before the 2004 election.

Whatever rules exist, it is always the rich, not the poor, who have the resources to game the system. And they will do it, as long as the payoff is large enough to make it worth their while.

You might suppose that, in a democracy, voters would keep government officials in line, but it's obvious that they don't. As Caplan points out, special interest legislation is actually very popular. If you want to know why, I recommend reading Caplan's book.

tarran May 14, 2007 at 1:00 pm

Anybody who claims that Mexico has a weak government needs to re-do their research.

Yes, the "official" taxes are low, but the actual taxes levied by the government officials are quite high.

I also find it laughable that weak governments empower "big" business. Large corporations tend to maintain their size and dominance primarily through government assistance: the courts grant them special privileges and kneecap any newcomers who try to compete with them.

Sam Grove May 15, 2007 at 1:16 am

My favorite quote from Will and Ariel Durant
"It may be true that you can't fool all the people all the time, but apparently you can fool enough of them to runn a large
country."

Muirgeo, you have to give up the notion that democracy gives the people control over government.

Another quote, from Sy Leon:
"Voting is like going through one of two doors, no matter which one you go through, you end up in the same room."

Of course there's: Democracy is two wolves and a lamb voting on what to have for lunch.

muirgeo May 15, 2007 at 10:06 am

Muirgeo, you have to give up the notion that democracy gives the people control over government.

Posted by: Sam Grove

In practice you are right. In theory the founding fathers would be saddened by your pessimism. With your attitude we might have well given the country back to the Queen when she visited last week.

My point remains that the reason "The People" don't control the government is because monied interest have corrupted democracy. And in fact they have corrupted the markets as well. The current fight is no different then the one the British East India Company set us to in 1773.

My opinion is that you will never get your free markets and I will never get my government "By the People" until we separate money from politics. You think that's impossible…I don't.

Sam Grove May 15, 2007 at 2:04 pm

You think that's impossible…I don't.

It's impossible as long as government has the power, authority, and sanction to control resources…superficially, money.

In practice you are right. In theory the founding fathers would be saddened by your pessimism.

Oh, they were pessimistic about democracy, that's why they attempted to establish a constitutuional republic rather than a democracy. That's why the D of I mentions that the people have the right to change their government when it no longer serves them.

Governments always are instituted to serve the elite, and when the elite lose control, government serves itsself. The "people" are sheep to be shorn.

Sam Grove May 15, 2007 at 2:10 pm

Muirgeo,

Let me ask you some questions:
1 Why do people create businesses, or what is the purpose and function of business?

2 Why do people go into politics, or, what is the purpose and function of government?

muirgeo May 15, 2007 at 3:26 pm

Sam,

Good questions. There are actually 4 seperate questions. I'll start simple.

1) "Why do people create businesses.."

To make lots of money.

2) "..what is the purpose and function of business?"

To improve society.

3) "Why do people go into politics"

To improve society.

4)"what is the purpose and function of government?"

To protect its citizens.

Sam Grove May 15, 2007 at 5:01 pm

2) "..what is the purpose and function of business?"

To improve society.
To make money by providing goods and services to people

3) "Why do people go into politics"

To improve society.

Well, I'm sure this varies, but there are people who go into politics for the ego trip and/or to do "battle' for their tribe.
What seperates those that want to improve society from those that enter for, um, other reasons, is the ability to win the support from various interests in society. IOW, at manipulating perceptions. When I ran for congress in San Francisco, I followed Nancy Pelosi around, and while I could never say that she was "lying", I did notice that what and who she stood for shifted depending on who she was speaking to. I recall that she is from a political dynasty. IAC, the purpose of a politician is to get elected, once elected, the purpose is to get re-elected.

How do people think they will improve society by going into politics?

By creating/supporting legislation that attempts to control/manipulate peoples behaviors.

4)"what is the purpose and function of government?"

To protect its citizens.

That's what citizens are supposed to think about their government. The actual purpose of government is to maintain order…the existing order, by attempting to control/manipulate people's behavior by threat of legal action…sanctioned extortion, and not always such legal action if one thinks the government should be bound by the constitution.

Instead of thinking about society and government in terms of what you think it should be, but by the incentives and disincentives that have been established, always remembering the reality of human nature.

Individuals ALWAYS act in what they perceive to be their own interest, whether they be in government, or business, or in any situation. It's hardwired.

muirgeo May 15, 2007 at 8:09 pm

Sam,

I never understand the position of hating and distrusting government, especialy one that we choose, because you believe all people in government are corrupt. Then you trust the free market because it is flawless and all people who work in it are apparently perfect and principaled people.

Think of it this way Sam. Say you had two groups of people. One group was represented by the typical person (some good, some bad and some in between). And one group was representated by the best people you've ever known. Honest, hard working, loyal and trustworthy.

Now you have to choose. One group to be in charge of all of government and one group to be in charge of all business and private enterprise. Where would you place each group?

Sam Grove May 16, 2007 at 12:57 am

I never understand the position of hating and distrusting government, especialy one that we choose, because you believe all people in government are corrupt. Then you trust the free market because it is flawless and all people who work in it are apparently perfect and principaled people.

I'm certain you think that is what I said and meant, but it is not.
I have no thought that the market is perfect, wouldn't even know what that means.

What I do think is that in the market, we do not grant anyone the right, authority, or power to make us pay for anything we do not wish to buy.
The market does not tax us to send soldiers to other countries to kill whoever "the government" has decided must be killed.

You do not comprehend what the market is. It is a venue for people to trade values, for associations, make friends, recreate, create, start a business, get a job, make money, etc. No one is in charge of it. It's similar to an ecological system. It arises from the interactions of people. Everyone particiaptes in some fashion.

As for government, it is commonly thought that government was created (by whom, we might ask) to correct for the flaws of humans. I think that government is more a product of the flaws of humans. We know its origins in conquest, and the transition to what is called "the modern state", but its basic nature remains the same.
It is a tool of coercion.
Think of the incentives.

Sam Grove May 16, 2007 at 1:21 am

George Washington:
"Government is not reason; it is not eloquent; it is force. Like fire, it is a dangerous servant and a fearful master."

muirgeo May 16, 2007 at 3:26 am

Sam,

The markets could not exist without government! You act as if the government only impedes markets when the markets owe their very existence to government.

Lets see the market run with out soldiers and policemen and civil engineers. Lets see the market run with out corporate law, with out patent law and without a judicial system to uphold its contracts.

You said, "What I do think is that in the market, we do not grant anyone the right, authority, or power to make us pay for anything we do not wish to buy."

That's false for the same reason I stated above. Does the patent office not cost anyone a penny. How about the treasury.

And here worse still you state, "The market does not tax us to send soldiers to other countries to kill whoever "the government" has decided must be killed."

Holy cow….this is nothing but a war to protect the oil market and it's costing us hundreds of billions and the military-indutrial "market" is scoring big time on our tax dime. But oh yes it's all about terrorism….and the media industry makes a pretty penny off the terrorism and great "war stories" to come out of it. The markets ARE indeed taxing us heavily and they are taking life and limb from our soldiers by the tens of thousands while the wealthiest get tax breaks and the oil companies break record profits off of them. Certainly the politicians on top have a lot to gain from endless war with consolidation of power and rule through fear. Works great but still these guys are controlled by the markets.

Sam Grove May 16, 2007 at 11:02 am

markets owe their very existence to government

Can you prove this theory?

Lets see the market run with out soldiers and policemen and civil engineers. Lets see the market run with out corporate law, with out patent law and without a judicial system to uphold its contracts.

Well, libertarians, the minarchist one anyhow, concede a role for government in national defense, police, and courts. OTOH, you may have heard of arbitration as a private alternative to courts. Militia as an alternative to government controlled armies. Even private roads, which was the norm once upon a time.

And for the last, you may suppose that the current administration has no ideological basis for its war mongering. And even if we grant that the oil corporations are benefitting, it is the government that forces citizen to pay for it. The oil companies certainly don't want to pay for it. If government had not the power to tax us, would we have troops in a hundred and twenty some countries around the world?

IAC, it is a well known behavior of governments, institutionalixed tribal hierarchies, that its members can be gathered in support of the leadership with the presentation of an external threat. See "The Prince", by Machiavelli for an elucidation of this. Politicians know this and successful politician are people with an instinct for this.

It is interesting how corporations, creatures of government, get sole blame for activities that are enabled only by political government. Notice my use of the word "sole", don't gloss over it.

I'll restate, war is made possible by political systems of governance with its ability to extort from its citizens sufficient resources to carry out the logistics.

Everyone knows that the only way to govern society is with a political hierarchy.
I say: It ain't necessarily so.

Sam Grove May 16, 2007 at 12:09 pm

And to answer the question about which group I would put in position of government: I trust no one that wants power over me.
I wouldn't put 'known to be bad' people in such a position and I wouldn't wish it on decent people.

Political power is a peculiar kind of honey. What kind of flies do you suppose are attracted to it?

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