flink@umcp-cs.UUCP (Paul Torek) (03/05/85)
I asked Mr. McKiernan for evidence to support his claim that concentrations of economic power could not persist in a Free Economy. He replied that evidence can be found in the fact that all such concen- trations were obtained with political priviledge, that such concentra- tions have generally become more stable as government meddling in the economy has grown, and that X-inefficiencies eventually eat-up the profits of most licensed monopolies. I find this insufficient. The first two facts may simply reflect the prevalence of "political priveledge", without indicating that this is the *sole* cause of economic concentration. I would particularly like to know what Mr. McKiernan thinks of the phenomenon called "natural monopoly" (see Griffin & Steele, _Energy Econ_ for definition) -- is it unreal, or unproblematic, in his view? McKiernan claims that "von Mises blew Market Socialism out of the water as well (Torek needs to do more research on the Calculation Debate)." The parenthesized statement is true, but I think McKiernan needs to do more research on the definition of Socialism. As I understand it, socialism = worker's control (of the "means of production"). Nothing in this definition rules out the possibility of a perfectly voluntary, libertarian-compatible, socialist society -- see Robert Nozick's famous book for more details. (Nozick takes this as support for libertarianism, since it allegedly shows its flexibility, tolerance, etc.) McKiernan correctly points out that taxation policies can internalize externalities only in a very limited number of cases. I find those cases *very* interesting for what they show about libertarian principles. A moral/political principle is a generalization; it is wrong if it is wrong in even one case -- at least, so I would argue. No doubt you can see that I think this is just such a case. Others may disagree. They will say "the libertarian principle is right, therefore this consequence of it MUST be right;" I say "the consequence is wrong, therefore ...". McKiernan says "In such cases, Libertarians would obviously rather sacrifice economic performance to negative liberty (most ideolo- gies will sacrifice economic performance to something in some cases)." I think that Libertarians are sacrificing it to an unworthy ideal. McKiernan says my inclusion of education as a source of externalities is wrong; I say: think harder. For one thing, education promotes invention, and invention has positive externalities. Perhaps McKiernan's point is that the externalities are much smaller than the internalized benefits; he may be right about that. I asked for rational reasons 'to value present consumption over future consumption *PER SE*' (emphasis added); McKiernan gave *ex- trinsic* reasons; I think he may agree with me that to value the present over the future *per se* is irrational. The point is a minor one, and nothing he said contradicted it, so I probably should have skipped it. --Paul "Don't look at me -- I'm just another apologist for the status quo" Torek