Caveat Emptor

From: J
Sent: Friday, April 06, 2018 10:22 PM
To: wblock@loyno.edu
Subject: Austro-libertarian perspective on disclosure

Good Evening Dr. Block, My name is J and I am a new Austro-libertarian attempting to flesh out the consequences of Austro-libertarian principles. The non-aggression principle, respect for and enforcement of property rights, and voluntary engagement in contracts form the basis for a more peaceful society. I’ve recently seen videos in which you lay out logical consequences of these principles, and these arguments have added a lot to my understanding of Austro-libertarian theory. Specifically, your explanations that the strict definition of property rights trumps voluntary contractual agreements to result in the moral invalidation of fractional reserve banking, the no-win situation that companies are put in with the existence of anti-trust law, and your pushing the limits of possibilities of privatization of any and all sectors of society have opened my eyes to the breadth of Austro-libertarian thought. So before proceeding any further, I’d like to thank you for helping me in my own journey to see just how profound and sweeping these ideas and their logical consequences are. In that vein, I’ve been trying to explore how Austro-libertarian thought would apply to some of the particulars of voluntary contracts. Specifically, I’ve been hung up on what burden, if any, is on the seller of a good/service in a voluntary transaction to disclose information about the good/service to the seller. Would a used car salesman be obligated in any way to inform a potential buyer that the he/she suspects/knows a specific car part will catastrophically fail shortly after the purchase? Is it the fully the responsibility of the buyer to inform himself or herself of the condition of the good/service, and is there a reciprocal responsibility of the seller to grant access for the buyer to inspect the good/service in order to absolve the seller of responsibility? Does a ‘buyer agrees to buy the good/service as is’ clause in the contract fully absolve the seller of liability in all cases? All of this assumes that the seller does not outright lie to the buyer, as this could be construed as breach of any agreed upon contract. Again, I’m appreciative of your contributions to Austro-libertarian thought, and I feel lucky to have stumbled upon videos of you illuminating these topics. Any response to my questions of disclosure and contract particulars would be greatly appreciated as well. I wish you well in your continued spreading and strengthening understanding of Austro-libertarian ideas. Sincerely, J

Dear J: This is a difficult challenge you present. But, it is a normative not a positive one; therefore, it pertains solely to libertarian, not Austrian, theory.

In my view, the doctrine of caveat emptor, buyer beware, is the best response. Yes, an outright lie would indeed be fraud. But, if the seller says to all customer queries: “No comment. This is an ‘as is’ sale. I make no claims about the product.” Then, I don’t think he should be held responsible for any flaws in the product. On the other hand, if he purposefully places a time bomb in the product, ready to go off 24 hours later, then, he is in effect not only to be held liable, but, also, to be considered a murderer. I think there is an implicit contract in all sales that would preclude that sort of behavior. So, I’m a “moderate” on this question. I’m not a total supporter of caveat emptor. I make an exception for that sort of thing. It’s not for nothing that I am known far and wide, at least in my own mind, as Walter Moderate Block.

See on this:

https://scholar.google.com/scholar?hl=en&as_sdt=0%2C19&q=caveat+emptor&btnG=

And also this:

Block, Walter E. 1988. “Caveat Emptor,” The Freeman Ideas on Liberty, May, pp. 180-181, https://fee.org/media/16328/1988-05.pdf

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8:12 pm on May 6, 2018