December 3, 2008
And The Cars Are Cooler
Insty links to another good column out of the Reason 40th issue. Nick Gillespie and Matt Welch on "The Libertarian Moment." Not sure their political prognostications are on target, but the same theme of a palpable increase in freedom shines through:
We are in fact living at the cusp of what should be called the Libertarian Moment, the dawning not of some fabled, clichéd, and loosey-goosey Age of Aquarius but a time of increasingly hyper-individualized, hyper-expanded choice over every aspect of our lives, from 401(k)s to hot and cold running coffee drinks, from life-saving pharmaceuticals to online dating services. This is now a world where it’s more possible than ever to live your life on your own terms; it’s an early rough draft version of the libertarian philosopher Robert Nozick’s glimmering “utopia of utopias.” Due to exponential advances in technology, broad-based increases in wealth, the ongoing networking of the world via trade and culture, and the decline of both state and private institutions of repression, never before has it been easier for more individuals to chart their own course and steer their lives by the stars as they see the sky. If you don’t believe it, ask your gay friends, or simply look who’s running for the White House in 2008.This new century of the individual, which makes the Me Decade look positively communitarian in comparison, will have far-reaching implications wherever individuals swarm together in commerce, culture, or politics. Already we have witnessed gale-force effects on nearly every “legacy” industry that had grown accustomed to dictating prices and product and intelligence to their customers, be they airlines, automakers, music companies, or newspapers (it was nice knowing all of you). Education and health care, handicapped by their large streams of public-sector and hence revanchist funding, lag behind, but even in those sorry professions, practitioners are scrambling desperately to respond to consumer demands and compete for business.
The political pursuit of liberty since 1971 has failed, yet the advancement of liberty has not.
Philosophy Posted by John Kranz at December 3, 2008 3:35 PM
In a free market, no industry is incapable of dictating anything beyond what its customers will accept.
"The direction of all economic affairs is in the market society a task of entrepreneurs. Theirs is the control of production. They are at the helm and steer the ship. A superficial observer would believe that they are supreme. But they are not. They are bound to obey unconditionally the captain's orders. The captain is the consumer." - Mises, "Human Action"
For this reason, certain conservatives are fools to blame things like pornography, when pornographers couldn't ply their trade if consumers wouldn't want it. Nobody's being forced.
But if you want to talk about who has the power to dictate, that's government. Only government could enforce fuel efficiency standards that forced consumers to buy smaller cars with weaker engines than they'd otherwise want.
Airlines cannot force passengers to accept small seats, poor or no food, or baggage check fees. Consumers can reject any of these if they aren't to their liking. The fact that people still fly doesn't mean they're "forced," but that the benefits of flying are worth a few or several hours of unpleasantry.
These two twits might be libertarians but are pretty damn confused when it comes to understanding market forces. Music companies didn't "force" anything on us. Technological innovation simply spurred competition that gave the consumer more options. It's no different than ~3500 years ago when a Hittite trader could offer an iron blade as the new alternative to Egyptian copper blades.
Posted by: Perry Eidelbus at December 3, 2008 10:56 PMAwesome Mises quote.
I don't have a quarrel with anything you said, Perry, but you fall into my favorite trap. I pay so much attention to Government (keep your enemies closer) that I forget it is still not what defines our lives.
An expanded, globalized, productive market provides freedom, and has been increasing it faster than our tyrants in Washington have been able to usurp it. I fear for both sides of that equation in the next few years but feel Gillespie and Welch are right to celebrate these achievements.
Posted by: jk at December 4, 2008 3:00 PMI pay so much attention to Government (keep your enemies closer) that I forget it is still not what defines our lives.
Not sure what you mean by that.
They're right to celebrate our prosperity, but for the wrong reasons. I don't mind that they're "on our side," but I wish they'd understand *why* and learn about the real market forces at work. If they think that any seller of goods or services is capable of "dictating prices and product and intelligence to their customers," then they don't believe the consumer has ultimate power, and they are wrong.
The ability to "dictate" comes only with force, like when certain members of the Japanese felt they'd have to march into Washington to "dictate terms." In voluntary transactions, because of the implicit freedom to choose, neither side has the ability to "dictate" anything. As an example, a friend the other day was complaining that milk prices are still so high, that even with gas prices going down, dairy farmers and dairy companies are still "making us pay higher prices."
You don't "have to" pay the higher price. You can buy your own cow. You can buy substitutes like goat milk and soy milk. You can choose not to consume any milk at all. No one is "dictating" anything.
If someone (let's name him John) were to die in exactly 5 minutes without a certain medicine, and the only seller (let's name him James) demands everything John owns, James is still not "dictating" the price, nor is he "forcing" John to pay. Most people don't understand this, because they'll argue "But John has no choice, he needs it or he'll die!" Yet John most certainly still has a choice, in terms of logic and real economics: he can choose to die.
Posted by: Perry Eidelbus at December 8, 2008 12:01 PMMy ill-explained statement means that the market is giving us freedom -- not just prosperity -- even though government is not.
I'm surprised to find myself defending the Reason cats, but here goes. Gillespie and Welch are stating that we have moved away form a regulated market in planes, trucking and media that allowed fewer licensed players to "dictate" prices without competition. And that now market forces have taken this away. I'm not sure you and they are on opposite sides here.
Posted by: jk at December 8, 2008 2:48 PMI never thought I'm on an opposite side from them, only that they don't understand market forces.
If they're talking about industries that relied on government protectionism for any "market power," that's one thing. But I just don't see that. They specifically mentioned "airlines, automakers, music companies, or newspapers," then referred to companies having "to respond to consumer demands and compete for business." Barring government interference, these industries were already responding to consumer demands as part of competition. They weren't "dictating" anything -- other than what customers were willing to accept.
Even if there's only one seller of a particular good or service, that's still competition. If the company does not provide what will satisfy its customers and prospective customers, then someone else will rise up and offer a substitute good or service. But if there's a single provider of something, and government is not assisting it in any manner, then by definition it's competitive in providing what people want. Thus competition does not require many, multiple or even two participants. In fact, government breaking up a company (e.g. Standard Oil, Ma Bell) destroys competition by denying the consumer the freedom to buy from a company he otherwise would have.
It appears that these principles of markets are lost on these two. They might be libertarians, even good ones, but let them understand why libertarianism works. It's a lot more than chanting "Legalize drugs! Protect free speech! Stop subsidies and welfare!"
Posted by: Perry Eidelbus at December 9, 2008 3:13 PMAmen. I think they are happy to conflate airlines, which did have government price setting, with newspapers, which had a standard oligopoly.
Posted by: jk at December 9, 2008 3:31 PM | What do you think? [6]