tim@isrnix.UUCP (07/01/83)
Ah! jj's response to my praise of our government's role in agriculture points up the fundamental problem with Libertarianism-they cannot seem to accept any cause or effect beyond the individual-that what is rational for the individual as one person may become disaster for a group of individuals in a society they cannot comprehend. jj says this: >> He clearly misses one point, namely that the CAUSE of the >>cobweb effect is an ill-considered behavior on the part of the >>producers. Ill-considered behavior is clearly not capitalistic >>behavior, because, even though SOME producers will make more money in >>the shortage market, most will be broken in the surplus market, and >>losing one's business is clearly not a practice encouraged by a capitalistic >>society. Well, of course if all the farmers could get together they would see that when all of them overproduce that they ALL lose. Indeed it was precisely this realization that fueled recurrent Populist Agrarian movements and led to the development of the large Dairy Cooperatives and other Farmer's Cooperatives, AND to political pressures for farm price support programs. However such developments contradict the assumptions of neoclassical economics (the theoretical underpinning for Libertarianism)that the market is composed of a bunch of small producers no one of which can affect the market. For that smacks of "restraint of trade" "monopolism" and egads! even by some incredible feat of imagination, "socialism"! And when you have monopoly power over the market or government intervention then you no longer have a "free" market which is supposed to be the most efficient possible economic arrangement which in turn is the justification for the inequalities of Capitalism. However let us say that we DON'T have any farmer cooperation as in our lovely laisezz-faire model. Then in that case each farmer could care less about her/his fellows-S/HE wants to produce as much as possible because regardless of whether the price is low or not-the price is the price to the individual farmer s/he can't affect it so 200 bushels at $1 are better than 100 bushels at $1. If the individual farmer decides to curtail production it won't affect the price one wit (or .0000000001%!)it merely means the farmer has LESS to sell at the market rate and thus will lose money. Which is precisely what happened historically-farmers produced as much as they could-prices dropped precipitously, farmers went broke and so forth. However even those ruggedly individualistic true-blue American farmers could see that-"hey we's ALL going broke! I think we got to get together and do something about it!" Indeed it was in their best self-interest to do so! Which is how it turns out that government and cooperative action is actually in many cases in everybody's best interest. The farmers went broke less often, food became cheap, and we now have an incredible agricultural cornucopia! Everybody is now better off. yea for people getting together to solve their problems! THAT is what GOOD government is all about! Tim Sevener decvax!pur-ee!iuvax!isrnix!tim