asp@ATHENA.MIT.EDU (07/29/86)
Return-Path: <asp@ATHENA.MIT.EDU> Date: Sun, 20 Jul 86 17:52:30 EDT From: Jim Aspnes <asp@ATHENA.MIT.EDU> To: "Keith F. Lynch" <KFL%AI.AI.MIT.EDU@ht.ai.mit.edu> Cc: steven@LL-XN.ARPA, KIN%AI.AI.MIT.EDU@ht.ai.mit.edu Subject: Why the US Post Office exists Reply-To: asp@athena.MIT.EDU The US Post Office exists, and (used to) lose money, because they will deliver a first-class letter anywhere in the United States for a nominal fee. No private mail company has ever claimed that it could provide the same universality of service at the same price as USPS. This is also the reason why AT&T was a monopoly, and why governments invest in smallpox vaccines or food stamps. There are some things that must be provided by a just society, and if the free market cannot or will not provide them, then it has no place getting in the way of organizations that can. Capitalism makes a worthy slave but a wicked master. -------
kfl%mx.lcs.mit.edu@mc.lcs.mit.edu (07/29/86)
Return-Path: <@MC.LCS.MIT.EDU:KFL%MX.LCS.MIT.EDU@MC.LCS.MIT.EDU>
Date: Mon, 21 Jul 86 21:13:14 EDT
From: "Keith F. Lynch" <KFL%MX.LCS.MIT.EDU@MC.LCS.MIT.EDU>
Subject: Re: Why the US Post Office exists
To: ASP@ATHENA.MIT.EDU
cc: KIN%MX.LCS.MIT.EDU@MC.LCS.MIT.EDU, steven@LL-XN.ARPA
From: Jim Aspnes <asp@ATHENA.MIT.EDU>
The US Post Office exists, and (used to) lose money, because they
will deliver a first-class letter anywhere in the United States
for a nominal fee. No private mail company has ever claimed that
it could provide the same universality of service at the same
price as USPS.
I think someone choosing to live outside the city should suffer (and
enjoy) all the consequences of doing so. I don't see any reason why
some customers should subsidize others. Or why taxpayers should
subsidize either group.
This is also the reason why AT&T was a monopoly, ...
Right. It was said that the long distance phone rates were high
because rural customers were being subsidized by urban customers. And
that if competing long distance firms were to be allowed, that rural
rates would hit the ceiling. Well, rival carriers WERE finally
allowed, and rural rates have gone DOWN, as have urban rates. AT&T
discovered that they COULD lower their rates, if they needed to to
stay in business.
Now if only they would allow competing LOCAL phone companies!
One of the main points that opponents of pure capitalism often make
is that without government, there would be nothing to prevent
monopolies from forming and driving up prices and reducing quality.
Well, they are certainly correct that monopolies drive up prices. And
that they reduce quality. But the only way monopolies can exist is if
government mandates it. There are many examples of such monopolies.
In the 19th century, many railroads had a monopoly over their
service area, since the government gave them land for free and forbid
any other railroad from operating in the area. It is ironic that the
resulting bogus price structure was blamed on capitalism, rather than
on government interference. Today, most areas have monopolies in
local phone service, electric power, and water. There are a few
places with competing phone service and/or competing power service,
and the prices for those services is generally much lower than where
they are a monopoly.
And today, cable TV service is becoming available in many areas.
This too is generally a mandated monopoly. A common pattern is what
has happened where I live. Several cable companies compete for a
guaranteed monopoly. This consists entirely of presenting bids to the
local government. The company that offers the most service for the
lowest cost to consumers wins the right to be a monopoly. After a
year or two, they start reneging on the bid. They raise their rates
and reduce their services. This, they say, is because of
unanticipated market conditions. Of course by then it is too late to
go back and offer the contract to some other cable company. Why the
government doesn't simply allow any number of cable companies to
compete for the same customers is beyond me. Why the government even
thinks it has any say in the matter, why it thinks whether or not to
interfere in the free market is its choice, I don't understand.
Things are being handled a little more rationally with cellular
phone service. By federal law two and only two companies are allowed
to compete in each metropolitan area. Why it should be limited to
two, I don't understand. Spectrum space isn't THAT limited. But at
least two are better than one. Thank goodness it hasn't occured to
anyone to make cellular phone service available to all rural areas, to
be subsidized by the urban cellular phone users, or worse yet, by
taxpayers.
I am not aware of ANY monopolies that are NOT mandated by the
government. I don't see how one could get started. If one did, and
it started raising its rates, other companies would get into the field
and undersell it. Unless they were forbidden to do so by the
government.
And, of course, lets not forget the most notorious monopolies of
all: The labor unions. Laws protecting the 'right' to strike without
being fired, and the 'right' of a union to insist that employers hire
no non-members, are largely responsible for the US trade deficit, and
the replacement of US made goods with goods made in Japan and Korea.
Especially depressing are recent rulings limiting state laws
forbidding unions from demanding closed shops. Virginia has such a
law, and a person who was turned down for employment by the WMATA
transportation authority on the grounds that he was not a union member
brought suit under that law in the Virginia court system and won. The
union appealed to the federal court system and won. The federal
ruling says that Virginia's right-to- work law does not apply becasue
WMATA headquarters is not in Virginia, even though the job he was
applying for was.
A similar case under the Tennessee right-to-work law said that the
law does not apply to the new Saturn plant, for some equally random
reason.
There are some things that must be provided by a just society,
There is no such entity as 'society'. There are individuals,
various voluntary organizations such as companies, churches,
universities, and social clubs, and there are local and state
governments, there is the federal government, and there is the UN.
Which of these should provide what 'must' be provided? Who decides
which of these? And who decides which things 'must' be provided?
Perhaps Meese thinks that protection from pornography must be
provided. Perhaps Reagan thinks that protection from cocaine must be
provided, even if it means sending troops into foriegn countries.
Remeber that governments can't really provide anything. No
government has anything to provide. What governments CAN do is take
things from some individuals and give them to others. No government
can make the world a better place, all they can do is redistribute
what's already there.
and if the free market cannot or will not provide them, then it
has no place getting in the way of organizations that can.
The free market is not an entity. It consists entirely of
independent free individuals and voluntary organizations of
individuals. Any individual who wishes to contribute to a worthy
cause is free to do so. Nobody else may get in his way.
I am not sure what you mean by the free market getting in the way of
organizations (I assume you mean governments) who can provide things.
If I understand you correctly, this is a curious inversion of logic.
Individuals would 'get in the way' of an organization devoted to, say,
abolishing the housefly, if they choose not to contribute money to the
organization.
I am not advocating anyone getting in the way of anyone doing any
good deeds. I am simply saying that the good deed doer has no right
to steal property from others no matter how good his deeds. A person
DOES have the right, in other words, to 'get in the way' of someone
trying to pick his pockets.
Capitalism makes a worthy slave but a wicked master.
Very profound. But does it mean anything? Capitalism is the system
where individuals are free to do what they please, so long as they do
not infringe the rights of other individuals. How can such a system
be a master? How can anyone be a slave to it?
...Keith
-------campbell%maynard.UUCP@HARVISR.HARVARD.EDU (08/05/86)
In article kfl%mx.lcs.mit.edu@mc.lcs.mit.edu writes: > From: Jim Aspnes <asp@ATHENA.MIT.EDU> > > The US Post Office exists, and (used to) lose money, because they > will deliver a first-class letter anywhere in the United States > for a nominal fee. No private mail company has ever claimed that > it could provide the same universality of service at the same > price as USPS. > > I think someone choosing to live outside the city should suffer >(and enjoy) all the consequences of doing so. I don't see any reason >why some customers should subsidize others. Or why taxpayers should >subsidize either group. Universal, inexpensive communications yield substantial benefits both economically, and politically. Economic example: Sears Roebuck drew most of its early growth from mail order business from rural customers. Political example: affordable mails allowed rural people to participate in political processes occurring hundreds (state capitol) or thousands (Washington) of miles away. "Subsidizing" those parts of the country where is is more expensive to operate than private industry would like winds up costing everyone less in the long run. The U.S. wouldn't be the world's premier agricultural region if rural settlement hadn't been encouraged the way it was in the 19th century. And despite all the self-righteous breast beating of capitalist ideologues, the single biggest reason for the wealth of the U.S. is not our economic system, but our agricultural and mineral wealth, tapped by rural pioneers. Without quoting from the original at length, let me recall that Keith objected to telephone monopolies. Please recall that when telephones first started, there WAS competition, and it DID NOT WORK. Businesses often had to have three, four, or five phones on each desk, because the private phone companies didn't interconnect. Recall also that with the technology of the 19th century it was impractical to allow more than one phone company to place wires on telephone poles in most areas. They needed an actual pair between each subscriber and the central office, and the wires were much larger then than they are now. Telephones did not become successful, and never would have, until a regulated monopoly was established with the charter of providing universal service. It is also important to note that telephone poles are located on public property (the streets), which is "owned" (controlled) by local governments. Thus, the local government should be allowed to distribute access to the poles as they see fit. If the people don't like it, they can vote in new local officials. > There are some things that must be provided by a just society, > > There is no such entity as 'society'... [more objectivist blather > follows] Of course there is such an entity as 'society'. Just because it cannot be precisely defined does not mean that it doesn't exist. Does "your neighborhood" exist? Does the "middle class" exist? Does "religion" exist? None of these can be exactly defined, yet they all exist. Here's the dictionary definition most relevant to this discussion: "A group of human beings broadly distinguished from other groups by mutual interests, participation in characteristic relationships, shared institutions, and a common culture." Of course there are many overlapping societies in which one may be said to be a member; I am a member of the "societies" of the town of Maynard, the state of Massachusetts, the Greater Boston area, the American northeast, the American middle class, and "western" society in general. Each of these societies provides me with different benefits. My town provides me with an educational system for my children, police protection, roads, and yes, a cable TV monopoly. Western society provides me with legal traditions, literature, religious institutions, international law, and so on. It's sophomoric to claim that society doesn't exist. Now, many objectivists and libertarians like to moan and groan about how society has no right to "pick my pocket", or "force me to do something". Balderdash. You are a member of any number societies by virtue of being born and raised by them. If you don't like it, fine, go live on a mountaintop and eat wild hickory nuts. But if you expect to be able to participate in the advantages that society provides -- culture, economic activity, safety, medicine -- none of which you can provide all by yourself -- then you must also be willing to contribute your share to society. I was once an objectivist myself -- in high school. I grew out of it, and most other objectivists I've known have, too. Objectivism (and its cousin, libertarianism) are smugly self-satisfying -- just the ticket for young people who are still struggling with the "leaving the nest" syndrome and identity construction of adolescence. But they cannot speak to the larger problems of human society one must face as a fully functioning member of human civilization. -- "There are two kinds of science: physics, and stamp collecting." Larry Campbell The Boston Software Works, Inc. ARPA: campbell%maynard.uucp@harvard.ARPA 120 Fulton Street, Boston UUCP: {alliant,wjh12}!maynard!campbell (617) 367-6846 -------