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With A Little Help From My Friends ...

What would you do if I sang out of tune,
Would you stand up and walk out on me?
Lend me your ears and I'll sing you a song
And I'll try not to sing out of key.

Joe Cocker's famous interpretation of this classic at the Woodstock festival has certainly been a source of inspiration for millions of eager listeners. Quite inspiring are also the vast amounts of money Washington has decided to raise in order to bail out major failing players on the US market, especially if you're a major failing player yourself. This is probably what Detroit's Big Three had been thinking all along, and indeed, now they've come out of the closet.

The last line of the article is, in my opinion, the most revealing:

But he added that "our trading partners give us no choice. Every other major auto manufacturing country protects their industry so we may have to do the same."

This ties in perfectly with the song lyrics posted above. He might as well have said:

Well, they may have done some malinvestments, yes, they kept producing gas-guzzlers for an increasingly shrinking market, maybe they didn't care too much about future planning, but everybody makes mistakes, no? You don't want to leave them alone right now, do you? After all, they're uniquely American car manufacturers. Just lend them a few billions and they'll honestly try to get in touch with customers again.

But seriously, he does make a point. Shouldn't we protect our domestic industries when foreigners do the same for their manufacturers? After all, foreigners will be able to export cheap cars, thus undermining our own efforts. Wouldn't it make sense to face "market realities" and fork some money out for a couple of minor subsidies?

First of all, there is no point in having "domestic car producers" if foreign car producers do the job more efficiently. Whether or not this is the case should be decided by customers and not by central bureaucrats. Now one might argue that tax-subsidized foreign car producers are being advantaged since they can make cheaper offers or include more features for the same price or whatever. To this I say, good for the customer. Taxpayers in a far-away land had to give their earnings to allow for such a great bargain, and Americans would only be disadvantaging themselves if they did the same or refused to take the subsidized offer.

Furthermore, subsidies lower the incentive of producers to improve price and quality conditions. Faced with below-market price competition from abroad, domestic car producers would have a huge incentive to implement even the smallest improvements, thus constantly pushing for the most efficient ways of production, the highest gas mileage, the most economical transportation routes and so on. In short, they'd be working for the customer which is what free markets are all about.

Subsidies, to the contrary, would set an incentive to hire more and better lobbying personnel to make sure the next bailout won't be all too troublesome to get. Car quality would be degraded to second rank, in spite of what all those neatly dressed spokesmen will tell you in the next few weeks.

However, there's still one concern left: jobs. Not subsidizing failing companies may result in a temporary unemployment rate hike. But there's no reason to believe that a) no new car producers would fill the gap (think, for example, of Tesla Motors, pretty much pioneers in mass-producing electric cars [thanks to Opponent for pointing me to this]) and b) people wouldn't find employment outside the car industry. Instead of producing cars that don't sell, people would engage in more profitable endeavors and would thus be doing society a much greater favor than by clinging to (at least for the moment) low-demand industries and products.

And for those (including myself, American trucks and SUVs are sure to draw my attention) who fear their "tough-built big block wonder machines" might stop being produced: there's always room for niche markets. If one of the Big Three, for example, decided to specialize on building heavy vehicles, they'd probably have to cut down on their production lines, but might be able to sustain doing "big car business" on a smaller scale, always according to market demand.

Cressbeckler for President!

I got a tax plan for ye *spits out* that goes right there!

"Cressbeckler has been living in a mountain shack with no hot water or indoor plumbing, making him a true Beltway outsider."

"Cressbeckler also promised ... [to replace] Congress with a horse that stomps once for yes, twice for no."

Seems like ol' Cressbeckler holds a fairly libertarian stance at least when it comes to domestic policy. You can't say the same of the mainstream candidates, can you ... ?

More internet insights

Since I shared my views on net neutrality and politicization of the internet with you just yesterday, I was quite pleased to see a similar, far more informed article appear on LewRockwell today.

It's most certainly worth reading.

On the legitimacy of private property

One of libertarianism's cornerstones most certainly is the idea of private property. But what is property, how does it come to be private and who defines the borders? Libertarians approach the topic this way:

Man owns himself. If this weren't so, those who disagree would have to explain who gave them permission to express disagreement and why exactly this circle of persons owns them while at the same time delivering a universal explanation of body ownership. Since this borders on impossibility, we assume self-ownership to be correct. Should man indeed own himself, then he also gets to own his labor, that is the product of his body's actions. But in order to use his bodily powers, he needs something to legitimately refine. This he finds in nature: unowned, unclaimed objects. Mixing his labor with unowned nature creates his own private property which is now subject to his own jurisdiction.

But why should individuals be allowed to claim nature for themselves? It is the only conclusive way of distributing resources. If we desired to establish collective ownership of the land, i.e. nobody owns anything, it is questionable whether we have a right to stand (sit) on the ground we do right now. Who gives us the right? Furthermore, who is to decide on the use of the land in such a society? Government? But isn't government just a number of powerful people and would therefore create just another form of private property in which central planners act as ultimate property owners? Every other shade of collectivist land ownership, be it Gesell's Freiwirtschaft (which Wikipedia, at this point in time, is for some reason calling a "libertarian economic idea") or social-democratic property redistribution schemes, suffer from the same philosophical weakness.

Of course, libertarian property theory is not to be used as an apology for existing property distribution either. Vulgar libertarians tend to do this in defense of corporations quite often. If person or corporation X illegitimately steals property from some native tribe or from poor locals, this most certainly constitutes a crime as well and should be punished.

Liberty and extremism

As long as I've held conscious and thought-out views on how to organize society, I have been pretty much an extremist. Throughout my adolescense, I would advocate nationalization of industries as a means for just distribution of goods produced and profits reaped or propose expropriation of those who work against the "common good". Sounds scary for someone who nowadays claims to be a libertarian, doesn't it?

These days, I've switched to the other extreme. I support laissez-faire markets, privatization (not in the corporatist sense, however) of former state property or the abolition of compulsory institutions like the draft, public schooling or even taxes. This attitude has been troubling me for quite some time since a number of acquaintances of mine have been expressing worry about my unyielding stance on things. Some have even stopped arguing with me for my lack of willingness to compromise. Maybe, I thought, I'm just a simplistic moron without sensitivity for exceptions.

However, I've recently developed another more encouraging explanation which I would naturally favor to believe. My hardcore socialist views, as well as my unrelenting libertarian stance, are simply the result of rational deduction from given premises. While being a socialist, I accepted the Hobbesian theory of "homo homini lupus" and the consequent need for a monopoly of force. But I advanced from there: if people really are inherently bad and only work to trick one another, how in the world can we allow a market-based economy and society to exist? This view was reinforced by the Marxist theory of capital accumulation which states that in a capitalist economy, capital tends to concentrate in an ever diminishing number of hands until there is only one great capitalist or one powerful oligarchy left. This, of course, coincided with the view that humans act to fool each other and provided the economic background for the philosophical observation. I just needed to follow the path ahead to consider socialism superior to every free market organization.

Thanks to Ron Paul and several other conservatives and libertarians, I was able to question the Hobbesian premise. If people are inherently bad, how can we allow a monopoly of force to be run by them? This produced a huge crack in my socialist think-wall. As I later found out, among many other insights, about the mutually beneficial nature of market transactions and the principle of self-ownership, I had to change my philosophy in order to stay consistent.

Thus, my extremist views were simply rational deductions from my philosophical premises. Being "extremist" simply meant employing logic. A change in premises may imply differing results which made me arrive at libertarianism.

As Barry Goldwater concisely put it,

"I would remind you that extremism in the defense of liberty is no vice! And let me remind you also that moderation in the pursuit of justice is no virtue!"

Good to know, isn't it?

People's republic of Internet?

About a week ago, members of the German left-wing anti-fascist activist alliance "Antifa" hacked the forums of the racist "Blood and Honour" organization. A German statement, plus links to the downloadable forums, can be found here.

What raised my attention was one phrase in the statement. Translated into English, it says "dear citizens of the people's republic of Internet". I was struck by surprise since I'd never considered the Internet to resemble "a people", let alone a "people's republic". I'm not sure whether this was just a fun phrase used by the notoriously socialist Antifa people or whether some more deeply rooted conviction had been expressed by it.

I tend to favor the latter as there are manifold examples of attempts to "democratize" the Internet. The net neutrality movement is a somewhat famous one. Net neutrality advocates claim that internet providers have no right to suppress certain internet activities on their wires or to discriminate against specific contents or services by slowing the data transmission over their wires. Most internet users would readily agree with this postulate since the internet is now widely considered to be "a public good", something not to be interfered with by single individuals or companies.

But is it really? Is the internet a public good, a democracy or a people's republic?

Actually, the internet is a prime example of a libertarian success story. In a number of ways, the internet may be compared to a completely privatized city. Private road owners (internet providers) connect real estate owners (servers, content hosts). Everything is defined by private property rights; road owners have created agreements on crossings and traffic allocation which allows for the fastest possible and therefore most profitable data exchange. Server owners are free to discriminate against any content they deem inappropriate (for example, quite a lot of hosts don't allow porn on their networks). So are (or were) road owners; they are (or were) free to slow traffic to and from content distributors they considered improper. That's a fine example of a self-governing private property society, but most certainly not of a people's republic.

But the primary difference between the internet and a people's republic is the lack of government. The internet equals a spontaneous order, created and maintained without centrally planned advice. Western governments, while certainly desiring to control and regulate the internet, have so far mostly confined themselves to only intervening when "real world laws" were broken within the framework of the net.

This could dramatically change with the onset of net neutrality legislation. While initially just working towards "net justice" and "securing equal access", government will soon begin to pursue special interest wishes in the name of these formerly named goals, just as "real-life government" now extends to almost every aspect of life even though it had been installed to merely "protect life and liberty". Net neutrality advocates ignore this danger of "legalizing government" and instead trust in the wonders of democracy to secure that "good people are being elected" in order to keep the internet clean and free. Just like it works in the real world, doesn't it?

Conclusively we might say the internet is a libertarian private property anarchy and that's why it has been so vibrant and successful. Every attempt to modify it by government regulation will most likely strangle its self-correcting mechanisms and thus, diminish its seemingly inexhaustible potential. Therefore, keep it clean of legislation !