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Mises Economics Blog

Correcting Kinsley on Libertarianism

February 1, 2008 7:18 AM by Robert Murphy (Archive)

An American liberal like Kinsley should (after 6+ years of the "War on Terror") be aware of the great downside to a government monopoly of the military. Everything that is wrong with government control of, say, automobile production, carries over into the arena of defense. For example, costs are vastly inflated, and inefficiency abounds, because there is no direct link between the customer and the service provider.

Notice that the typical argument for government provision of military services doesn't explain why the government would do a good job here (as opposed to the horrible job that everyone knows the government would do in computer, TV, or book production). Rather, the argument is always, "The market can't do it, so the government has to."

It turns out that the free market could indeed provide adequate military defense. FULL ARTICLE

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Comments (15)

  • Inquisitor

    I've seen the coercion-for-convenience argument quite a few times, e.g. people saying they prefer being taxed because it nicely collects all their bills in one place...

    Published: February 1, 2008 10:25 AM

  • Matt

    Alas, Kinsley is wedded to his Liberalism
    and no amount of Logic will change his mind.
    He has been on the same track of illogic for decades and has learned nothing even after the fall of the Soviet Union and numerous other failed Socialist examples.
    What can explain this mental intransigence?
    My guess is that as one becomes older it becomes more and more difficult to admit
    error in logic and for some it becomes impossible.

    Published: February 1, 2008 10:32 AM

  • Paul Marks

    Of course private roads would compete with rail and air transport.

    Private roads might be commercial for-profit things or they might be built by charitable trusts.

    However, one thing is clear - the government roads have been a terrible failure.

    The vast taxpayer subsidies for the "free" roads have undermined rail transport and the roads themselves are defective. In the United States and Britain there has been vast overexpansion of roads from the 1950's and these (often foolish) road schemes have been built without proper foundations - so they now cost a fortune in maintainence (and are still falling apart).

    How anyone can defend the govenment's management of the road network is beyond me.

    Published: February 1, 2008 11:11 AM

  • J D

    Not having read and having little interest in the target piece by Kinsley, comment on your response would be invalid.

    However:

    Before advocating Private Military Defense we should consider this: None of the United States has been involved in military defense since the 1860’s. And the defensive side of that rather major skirmish lost.

    Renaming the War Department to Defense Department in the mid-20th century was a Military/Industrial PR gem, but those who reflect on our military history must recognize it has been, following what the English might well call “The War of Colonial Rebellion”, mostly aggressive Offense.

    We should try to split our military forces into, and this first term is currently unpalatable, Homeland Defense Forces (with currently reasonable territorial limits) and Global Industrial Market Control and Management Forces.

    The latter should be funded with voluntary contributions from those who find their services a private good. Funding the former from the public sector would be of little consequence.

    I daresay privatizing the cost of US military aggression would severely curtail it.

    Your new BLOG layout is a decided improvement.

    Published: February 1, 2008 11:47 AM

  • anonymous

    Government is organized force. Such force is (ideally) only used for national defense and law enforcement. Putting this immense arsenal of force in the hands of private enterprise would

    --weaken human rights. Private force would not have to answer to a Constitution, a Bill of Rights, a Supreme Court, or a voting demographic.

    --weaken national defense. There is no way a handful of private competing forces could resist the expansion of a nuclear-armed empire, such as the Soviet Union. It takes empire to fight empire. I prefer a Constitutional empire (see above).

    --weaken the poor and lower middle class. The poor and middle class would not be able to afford private protection; the only way the survive is by taxing the rich. Poor and middle class neighborhoods would soon be taken over by drug cartels, terrorist gangs, and organized crime.

    --allow for the rise of totalitarianism. If America was protected by private forces, and had unrestrained free trade, there is no reason Joe Stalin couldn't have simply hired our military companies to fight for him! The result would be Global Empire For The Highest Bidder.

    Does anybody recall the corporate conspiracy to overthrow FDR by force? Are you troubled that they would have overthrown the elected government without guilt, to protect profits?

    Published: February 1, 2008 4:52 PM

  • Jim

    Matt says "Kinsley is wedded to his Liberalism and no amount of Logic will change his mind" and Robert Murphy concluded his article asking Kinsley to "Stop fighting your instincts and admit it: freedom works".
    So is there an "instinct" that stops people from admitting errors that logic can prove?
    Matt guesses that as one becomes older it becomes more and more difficult to admit error in logic and for some it becomes impossible and my experience supports that. For example why do Kinsley and say Ron Paul reject democracy and majority rule?
    I name Kinsley and Paul because the opinions of both are on the public record.
    After Kinsley's 'The Church Doctrines of Pope Ron Paul' was published in the Washington Post I have been calling on its editor to widen public debate of majority rule and get Paul & Kinsley defend their public opinions. That was nearly three weeks ago.
    Has anyone seen such a debate? What does that tell us about Washington Post editors?
    For more on the power of a "free" media see my URL.

    Published: February 1, 2008 5:16 PM

  • DS

    How to respond, let me count the ways.

    First, National Defense is one of the few legitimate functions of government, but I am certainly not so closed minded as to reject alternatives. But as one poster pointed out the notion of "defense" in America has been lost in the years since 1812, all Federal government military operations since that time have been offensive. A truly defensive military force could very well be so different in character that modern America wouldn't even recognize it.

    But the more interesting subject is roads: There is a massive mis-understanding by libertarians and statists alike that private roads would be exactly like government roads, only privately owned and run for profit. The history of "infrastructure" in general is very different from the common perception. The 19th century in America is quite possibly the single most mis-understood period in human history and the actual history of what were referred to as "internal improvements" is quite different from the statist 20th century version.

    In the 19th century roads, canals and railroads were built almost entirely through private enterprise. Interestingly the most famous infrastructure projects were the monsterous government funded boondoggles like the Trans-Continental Railroad (one of the most egregious historical examples of political graft, fraud and waste) which was a huge financial failure (and extremely poorly built and located) and the Erie canal which fared much better. But these projects were the exception, most transportation and infrastructure projects were built with private money and without any form of eminent domain. In fact, after ruinous experiences in the early part of the century, some that nearly bankrupted several state governments, most states amended their constitutions to strictly forbid public taxpayer money to be used for "internal improvements".

    One of the biggest mis-conceptions is the actual economics of these projects. Most weren't built by individual entrepenuers looking to charge tolls (a rather uneconomic proposition especially in uninhabited areas) but by consortiums of people who would benefit from the commerce that would result - usually local businessmen wanting to connect one area to another for mutual economic gain.

    That last point, "for mutual economic gain" is the part that the modern person who has grown up in a statist environement just doesn't get: Economics is not about people trying to screw each other and steal each other's money, it's about trade leading to mutual benefit. This is a concept that most people just can't fathom: no trade can happen withut mutual benefit, not buying a piece of gum at the grocery store, not buying a car or reading a magazine, or any other mundane economic transaction.

    The dynamic of "mutual economic gain" also disappears when the government monopolizes anything - then it truley becomes one guy trying to screw another based on political connections and corruption.

    All of the false ideas about the "free-rider problem" and other such nonsense are based on this false idea that economic transactions are driven by the motivation of one person trying to screw another. Once you take those blinders off the whole world looks different and things like non-public roads start to make sense.

    Thomas DiLorenzo touched on this subject in "How Capitalism Saved America", but I'd love to see a full blown scholarly work do it justice. Mr. DiLorenzo, could this be your next book?

    Of course most of these misconceptions are the result of another statist government creation: the government monopoly on schools. In government schools children may not learn to read, write and do math very well, but they all leave with the "knowledge" that all good things in the world happended because of government. Hmmmmm, maybe that was the point of government forcing children into government run schools in the first place.......

    Published: February 1, 2008 7:35 PM

  • Inquisitor

    "Does anybody recall the corporate conspiracy to overthrow FDR by force? Are you troubled that they would have overthrown the elected government without guilt, to protect profits?"

    Heroic of them. The world could've done without that arch-thief.

    Of course, anyone versed in economics would know that everything you mention that would malign private enterprise in the provision of law and order (supposedly), already does malign and will always malign government provision of it.

    Published: February 1, 2008 9:34 PM

  • anonymous

    I just love how patriotic people are on this site. Take a look at the above comment.

    Heroic of them.

    Somehow, I see nothing heroic about the subversion of a Constitutionally-elected government by self-interested parties. Call me crazy.

    The world could've done without that arch-thief.

    I agree! But he would have been out in a few years anyway. What about if the corporate interests had succeeded? Would they have been replaced in eight years by a leader of the people's selection? Would they have had any accountability at all?

    Do you know what it would have proven if they succeeded, it would have showed the people, who were already traumatized from the stock market crash and the war in Europe, that their Constitution and their vote was not the law of the land; force was.

    Keep in mind that this was in the middle of the Great Depression. Would the corporate government have done anything to help the middle class, who was now homeless and starving? Would it have wanted to?

    Would this corporate government have upheld the rule of law, free-market principles and property rights, and banned the initiation of force? Given its blatantly unconstitutional insurrection efforts, my guess is no.

    And speaking of private-sector defense, look at Blackwater: reckless cost-cutting, careless civilian casualties, pilots who can't fly, and fraudulently altered employment contracts.

    I notice that you didn't answer any of my other objections in my earlier post. Why not?

    Published: February 2, 2008 12:05 AM

  • P.M.Lawrence

    Once you look at the details, even the "internal improvement" of the Erie Canal wasn't as good as it looks - because it wasn't internal. It diverted existing Great Lakes trade from Canada to the USA, then improved it - but the diversion usually gets miscounted as improvement. It was certainly worth the USA's while, but it didn't produce that much in the way of improvement after all. New York's gain was mostly Montreal and Quebec's loss.

    Published: February 2, 2008 12:43 AM

  • DS

    Some thoughts on the Pasteurization of milk:

    "Libertarians would say that if most people want pasteurized milk, the market will supply it. Firms will emerge to certify that milk has been pasteurized. These firms will compete, keeping them honest."

    No,no,no!

    Most people don't want "pasteurized" milk they want "bacteria free" milk. There is a huge difference. This is Kinsley's fundamental error, one that is at the basis of most nanny-state "progressive" thinking.

    What the government has done in this instance (and millions upon millions of others) has mandated a solution to a so-called problem, not provided people what they actually want (as if providing people what they "want" is a legitimate function of government in the first place). And they have mandated this particular solution to this problem at least until somebody goes through the considerable effort to eliminate the law (laws and regulations don't just disappear when they are no longer needed, they have to purposely eliminated).

    In this instance, Pasteurization works by heating the milk to above 160 degrees to kill all the bacteria. This heating process changes the taste of the milk (something most people who didn't live before the mandate wouldn't even know) and could very well change or destroy other useful ingredients of milk (I don't actually know whether that's true or not, but I use it for illustration). It is possible that a process that did not change the taste of milk could be invented - which I think is what people REALLY want. Then they could choose the flavor of milk they preferred, "pasteurized" or "other method". Both would be "bacteria free" which is all anybody really should care about. But we will probably never know.

    Now that the machinery of government has mandated the pasteurization of milk there is little hope of ever finding a better way to kill all the bacteria in milk because what would be the point? Pasteurization is mandated regardless, so here is no motivation to find a better solution.

    What if, as happens so often, scientists in future figure out that pasteurization actually is un-healthful (the medical profession, not just the tobacco companies, once believed that smoking was healthful)? Now the government has actually done more harm than good. And the regulation won't just go away by itself just because it is harmful. It will have to be purposely nulified over the objection of an enormous number of vested interests that benefit from this regulation including bureacrats whose sole job it is to make sure that all milk is pasteurized, an industry of "Pasteurization consultants", the pasteurization industry, pasteurization equipment makers, etc. These groups that most people didn't even know existed will come out of the woodwork and fight to keep the regulation in place. If this bureaucracy is like most others it will have relied on the industry for the latest information because govenment bureaucrats don't live in the real world and they don't have access to real information about the real world except to get it from people who actually live in it. Those industry groups whose livelihoods depend on that regulation will use their relationships (financial and otherwise) with these bureaucrats and the politicians in their local area (in the name of saving jobs in some congressman's district) to keep the regulation alive forever.

    "So yes, a Rube Goldberg contraption of capitalism could replace a straightforward government regulation."

    There is no such thing as a "straight forward" regulation. Every regulation has it's own burauecracy, in this case an army of people whose job is to force every milk producer to pasteurize their product, something that by Mr. Kinsley's own admission, they are very likely to do anyway! Talk about Rube Goldberg.

    These direct government costs are easy enough to understand even though their budgetary costs will probably be buried down inside a government agency. Due to government accounting practices that would make an Enron executive blush, being able to actually know how much money is spent (wasted) forcing people to do something they would already do anyway will never really be known.

    The indirect costs and unintended consequences of this "straight forward" regulaton are much more difficult to track and understand. While Kinsley tries to flatter libertarians by claiming that we are "very good" at finding the hidden costs in government he is over-estimating all of us. We have not even scratched the surface in understanding the billions and billions of hidden costs and unintended consequences of "straight forward" regulations like this one. The fact that government accounting purposely makes the tracking of such things nearly impossible doesn't help, but I disagree that any of us are as good at this as we should be.

    Even if this was an isolated case of a law that is redundant and not very useful - forcing people to do something they would do anyway. So what?

    Take this little "straight forward" regulation and multiply it by the 75,000 pages of regulations in the Federal Registry and it adds up to a giant mess of millions of bureaucrats each taking away a tiny piece of our freedom and a tiny slice of our paycheck (they are taking our money and using it to take away our freedom). Summed up the bill comes to: $2.7 trillion dollars and counting. And that's just the federal budget, many of these same bureaucracies exist at the state and local level as well, providing largely redundant enforcement of silly regulations like this.


    "All that is lost by letting the government take care of it is the right of a few idiots to be idiots. That right deserves respect. But not much. "

    The financial cost alone of maintaining these silly regulations over a period of decades is astronomical. Every dollar taxed, borrowed or printed has made the American citizens immediately poorer, and the lost opportunity to do something productive with that money compounded over decades is in-calculable. Imagine if all these bureaucrats doing pointless, redundant and harmful things all day long, for decades were put to use by private industry in productive pursuits? What if all those dollars wasted we left in the hands of entreprenuers or simply left in the hands of the taxpayer to pay for a trip to Disneyland or to have a little extra in his bank account for hard times. We'd all be much better off.

    When you sum it up there is a lot more lost than the "right of a few idiots to be idiots".

    WAY MORE. WAY, WAY MORE.


    Published: February 2, 2008 7:45 AM

  • Inquisitor

    "I just love how patriotic people are on this site. Take a look at the above comment."

    I'm not American, and even if I were I'd cheer on FDR's assassination.

    "And speaking of private-sector defense, look at Blackwater: reckless cost-cutting, careless civilian casualties, pilots who can't fly, and fraudulently altered employment contracts."

    Look at the employer... at least Blackwater was fired. Who will fire the US government?

    "I notice that you didn't answer any of my other objections in my earlier post. Why not?"

    Because they have been answered before (the answers to these objections lie in Hoppe's The Myth of National Defence, for the most part.) It's as if you are not a libertarian at all. Do you believe the market should provide education and healthcare? If not, you are not a libertarian, pure and simple. Your statements are a complete reversal of economic theory on monopolies - that somehow the government doesn't face all the problems you cite, because it's a monopoly...

    Published: February 2, 2008 9:41 AM

  • PR

    anonymous, Inquisitor is right that your objections are answered elsewhere on this site, but I'll take a stab at it anyway. Let's go down the list.

    Private force would not have to answer to a Constitution, a Bill of Rights, a Supreme Court, or a voting demographic.

    The current President does not answer to the Constitution ("a g**-d***ed piece of paper"), Bill of Rights, Supreme Court, Congress (signing statements), or even the voters once the election is over. This is nothing new either. FDR threatened to pack the Supreme Court until they approved his unconstitutional New Deal legislation.

    We've had national slavery (the draft), suppression of free speech (too many examples to list), seizure of property without due process (asset forfeiture), and countless other violations of the plain language of the Constitution. Since the federal government is the only game in town, your only recourse is to ask them nicely to stop. Good luck.

    There is no way a handful of private competing forces could resist the expansion of a nuclear-armed empire, such as the Soviet Union. It takes empire to fight empire. I prefer a Constitutional empire (see above).

    By far, more people have been killed by their own governments than by foreign ones, so what is the bigger threat? Anyway, the Soviet Union was able to muster the support of its people partly because they could present the US as the evil empire, which from their perspective it was.

    Remember George Bush's sky-high approval ratings immediately after 9/11? When threatened or attacked, people rally behind an awful regime because it is literally the only game in town.

    The poor and middle class would not be able to afford private protection; the only way the survive is by taxing the rich.

    Isn't this the case now? The poor and middle class cannot afford decent legal representation in the government's inefficient monopoly court system. How many people plea bargain on charges they are innocent of? How many inmates on death row have been later exonerated? Do these victims have any legal recourse against the corrupt prosecutors and judges who put them away?

    Poor and middle class neighborhoods would soon be taken over by drug cartels, terrorist gangs, and organized crime.

    Drug cartels and organized crime get their power from the government's prohibition policies. When something that is in high demand is made illegal, that demand will be filled by criminals. A private defense agency would be able to forbid drug use only among its own members, who would remain free to switch if they wanted to use drugs.

    If America was protected by private forces, and had unrestrained free trade, there is no reason Joe Stalin couldn't have simply hired our military companies to fight for him!

    No reason except that a backward communist country that could barely feed its own people couldn't afford it. A free society is far wealthier than a command economy.

    The US has a policy of propping up foreign dictators in Africa and the Middle East when it serves our (read: our leaders') national (read: private) interests (read: whims). So those governments are already available to the highest bidder. Their citizens have no recourse because their respective governments are monopolies, and we in the US have no choice but to pay for it all for the same reason.

    The result would be Global Empire For The Highest Bidder.

    As if our government's policies aren't determined by the highest bidder. A few tens of thousands of dollars in campaign contributions can get you a government subsidy or contract worth millions. Try getting that kind of return in the free market.

    While I am not fully convinced that a system of competing private defense agencies would work, I won't dismiss it out of hand with objections that apply equally well to a monopoly government.

    Published: February 2, 2008 10:20 AM

  • Simon

    "--weaken the poor and lower middle class. The poor and middle class would not be able to afford private protection; the only way the survive is by taxing the rich. Poor and middle class neighborhoods would soon be taken over by drug cartels, terrorist gangs, and organized crime."

    I remember, only a few months ago, reading about the "poor" in Brazil or some other South American country paying for private protection.

    I think it is quite the opposite, giving the state such an important task is tantamount to suicide, in the long-term. I will skip the obvious utilitarian arguments of the state being less efficient but point out that having a centralized control structure opens the country up to invasion and occupation. Imagine, if there is no control structure for an occupying force to take over then what will they do? When states invade others they want a structure already in place to aid them. The more decentralized this structure, the more difficult it is to gain control of the population. Also, the less used a population is to obeying the arbitrary laws of elites the more difficult it will be to invade.

    Published: February 2, 2008 4:05 PM

  • fishcreek

    One of the differences between the state and the free market is that the state can stir the
    nationalist and patriotic ferver of the citizens to a level of religious devotion. Afterall Blackwater is not called the "fatherland" or
    "motherland" is it? Anyone ever pledge to
    the General Motors company flag? Or march into gunfire for Maytag washers?
    Any enterprize that can do the things the state does will soon become like the state, think of the old company towns.
    Another is that the state on the national level
    views everything, including the populace, within its borders as the property of the state, to be used to perpetuate the state. And on the
    whole the citizens accept this as they would
    not from the free market. Why is worth a book
    or ten.



    Published: February 3, 2008 11:45 PM

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