Recently by Butler Shaffer: What Are Our Priorities?
It is no crime to be ignorant of economics, which is, after all, a specialized discipline and one that most people consider to be a ‘dismal science.’ But it is totally irresponsible to have a loud and vociferous opinion on economic subjects while remaining in this state of ignorance.
~ Murray Rothbard
While driving on the freeway the other day, I saw a sign on another car urging me to "demand free energy." Why the driver failed to include "free food," "free gasoline," "free designer clothes," "free cars," "free sex," "free luxury home," or any other whim was not made clear. This man's message expressed the whine heard from men and women whose parents never helped them to learn that the causal regularities of nature cannot be suspended for their momentary convenience; that the costs of the benefits we desire must be incurred by someone. Such infantile thinking underlies all political programs — the costs of which are forcibly imposed upon others. The self-serving demands for these programs are usually disguised more subtly as "general welfare," "social responsibility," the "public interest," or other seemingly selfless ends. On occasion — as was the case with this driver — the purposes are more patently expressed, albeit without the foot-stomping tantrums attending such displays in adolescent years. When I see or hear such demands, I am reminded of the childhood lyrics "I want what I want when I want it!"
This demand for "free energy" contained no reference as to how, or by whom, this resource was to be provided. I suspect that, had I been able to discuss the matter with this man, his explanation would have come around to the government (i.e., the taxpayers) incurring the necessary costs. In my freshman year in college, I saw an elaborate display — complete with architectural models — of how a nuclear power plant would operate. I was introduced to the lie that "because the costs of metering the resulting electricity would be greater than the costs of producing it, electricity would be provided free of charge to consumers." While still in my teenage years, I remember asking "who, then, would have an incentive to produce the facilities necessary to generate the electricity?" I was later able to figure out that such costs would be borne by the state (i.e., the taxpayers); that electricity, under this scheme, would be no more "free" than were government schools, highways, parks, or other such programs. Somewhere in my adult years, I read Jacques Ellul's observation to the effect "show me how electrical power is distributed in a society, and I will show you how political power is distributed."
To heap abuse upon my fellow motorist for his message would be to overlook the broader question: where might this man have picked up on the idea that his world should be rendered cost-free for the pursuit of his interests? Even a small child may come to recognize, upon reflection, that his or her lemonade stand has probably been subsidized by the parents. If mommy and daddy can be counted upon to supply all sorts of "freebies," might the kids grow up expecting a surrogate parent (i.e., the state) to relieve them of the necessity of investing their own resources in furtherance of whatever ends they wish to accomplish?
I suspect that, upon having a discussion with this motorized freeway lobbyist, I would have learned of a seemingly endless list of other projects for which others should be forced to pay: college tuition? medical care? rental payments for housing? day-care facilities for his children? Once infected with the mindset of living in a world in which the costs of one's preferences can be forced upon others, extending the wish-list to other projects is a simple matter. This, after all, gets us to the essence of all forms of politics: given the power to forcibly extract resources from others, politicians and bureaucrats can produce all kinds of wondrous things from pyramids to palaces to statuary to bridges and highways, . . . each of which carries costs about which it is considered impolite to ask questions.
Like the serial killer who "shocks" us with the same behavior engaged in by the "troops" we are urged to "honor," this freeway proselytizer was doing no more than emulating what passes for the state-directed economic policies that are helping to destroy civilization itself. The higher one goes up the corporate-state food chain, the less likely does one witness business firms having to respond to marketplace pressures such as competition from other firms, the shifting preferences of customers, and the continuing emergence of fundamentally new forms of products or methods of distribution. Recent years have made clear to us that the financial success or failure of large corporate enterprises depends more upon the political connections that assign positions at the government trough, than it does upon the informal processes of the marketplace. The "steel fist" of the state long ago replaced the "invisible hand."
In the disastrous Bushobama years, the American — dare I say Western? — economic system has eroded into little more than the corruption we now know as crony-capitalism. If major corporations experience financial losses, they know they will be rescued by a variety of government programs that amount to nothing more than bailouts. To the degree business firms are able to rely upon the state to cover their losses, they become like the Post Office, government schools, or any other political entity. What incentives would they have to maintain the competitive pressures that foster organizational efficiency? Indeed, in the absence of the discipline provided by the pricing system, how is it possible to even speak of "efficiency"?
In an economic system divorced from the demands and interests of private individuals, major businesses become as indifferent to people as do the clerks at the Department of Motor Vehicles. With the state as the guarantor of their financial well-being, firms become less interested in addressing customer demands; the transaction costs that are central to any form of voluntary contracting can be minimized. Above all else, the business community has helped to institutionalize the proposition that the costs of doing business should be socialized, while profits must remain privatized. If government bailouts, tariffs, taxation, and other forms of transferring to the general public the costs that would otherwise have to be borne by business firms do not convince you of the socialistic nature of the corporate-state, consider the powers of eminent domain invoked to benefit corporate interests.
It is a common practice for shopping center developers, professional sports team owners, or manufacturing firms, to turn to the state to use its violent powers to take land from owners who do not choose to sell and turn it over to the politically-connected. How many sports stadiums have been built through this process, wherein the taxpayers are required to underwrite the costs of land acquisition and construction — a form of socializing the costs — so that the team owners may enjoy the profits from their business? Some time ago, I read of a city in the Midwest whose city council refused to allow a developer to use the powers of eminent domain to acquire the land for the building of a hotel. The developer decided to withdraw his plans for the building, saying that it would impose too great a cost on him to have to negotiate with a number of landowners.
Politics is the most pervasive means for mobilizing such anti-social forces as theft, coercion, killing, deceit, parasitism, torture, lying, conflict, inter-group hatred, wars, and insistence upon obedience to authority enforced by violence. The state's principal purpose involves forcibly taking property from owners and giving it to others, a practice that includes imposing costs on those who have not chosen to bear them. This system is inherently at war with the self-directed nature of life itself: forcing people to act as they do not choose to act, and forcibly restraining them from pursuing ends they do value. As history reminds us — and as we are discovering for ourselves – such behavior destroys civilizations.
That these practices are so honored and the institutions that engage in them are so revered by otherwise intelligent people, is remarkable. That those whose lives will be destroyed by such thinking are eager to emblazon their support for its underlying premises as they drive the freeways, is all the more curious.
Butler Shaffer [send him e-mail] teaches at the Southwestern University School of Law. He is the author of the newly-released In Restraint of Trade: The Business Campaign Against Competition, 1918–1938, Calculated Chaos: Institutional Threats to Peace and Human Survival, and Boundaries of Order. His latest book is The Wizards of Ozymandias.