The conservation of coercion?

by on August 24, 2017 at 12:46 am in Books, Current Affairs, Philosophy, Political Science | Permalink

These aspects raise an uncomfortable possibility for libertarians: is there a sort of law of conservation of coercion in well-functioning societies? A community with a minimal state can only function if it is thick enough and homogeneous enough to enforce sanctions for antisocial behavior that are almost state-like in their severity, and, furthermore, can make them stick. Freeing individuals from their smothering parochialisms will lead to a compensating increase in the scope and reach of the state as people search for a new solution to social dilemmas formerly handled via informal means. Conversely, attempts to suddenly curtail state power may lead to chaos in the intervening period when social institutions have not yet reasserted themselves. Principled libertarians might still have good reasons to prefer the non-state forms of compulsion—among them the arguments from public choice economics and a federalist preference for decisions being made at the lowest feasible level, where actors are most likely to have relevant information. But “increased freedom” may not be one of them.

Here is more:

Kuznicki thinks the engineering mindset in political theory is an antidote to what he sees as a philosophical tradition of abstract theorizing that puts the state on a pedestal and makes it into an almost metaphysical nexus of the human condition. But as I look around, much of the vapid theorizing seems to be in favor of liberalism writ large, while the best current example of a state built on hard-nosed pragmatism is Singapore. Kuznicki himself is a representative of a currently fashionable sort of cosmopolitan libertarianism that has never existed in governmental form, and which I suspect is the least likely form of government ever to exist. What if a practical politics that took account of human frailty implied a world formed from a combination of cosmopolitan but illiberal city-states, unified but homogeneous nation-states, and sprawling empires that vacillate between centrifugal and centripetal tendencies? In fact, this is the world that has existed for most of recorded history. Perhaps the real ideological blinders are those which tell us that we have transcended this condition and can replace it with something else.

That is from William Wilson in American Affairs, hat tip goes to Garett Jones and Rogue WPA Staff.  Here is Jason Kuznicki’s new book, which I have not yet seen.

1 Steve Sailer August 24, 2017 at 1:01 am

Right, it’s like how European cops in Bloomsbury and the Left Bank are outfitted like Mobile Infantry from “Starship Troopers” these days just because they don’t enforce security at the borders well enough. You need security somewhere.

2 A August 24, 2017 at 3:10 am

You sound like someone who has never been to Bloomsbury.

3 Steve Sailer August 24, 2017 at 3:18 am
4 Anonymous August 24, 2017 at 5:40 am

“A guy stabbed someone” is the most imbecilic basis for a politics I have ever heard.

https://www.economist.com/blogs/graphicdetail/2017/03/daily-chart-23

5 Jason Kuznicki August 24, 2017 at 8:52 am

“A guy stabbed someone” is the basis of all politics, I think. And much of its substance besides.

That said, we should take care to be rational about it and resist politics by anecdote.

6 TMC August 24, 2017 at 9:12 am

Steve’s link does support his assertion.

7 mkt42 August 24, 2017 at 1:05 am

Wilson makes some good points. The “scientific” approach too often leads to the pursuit of impossible utopias, be they communistic, libertarian, or whatever. The “engineering” approach has some built-in advantages — less extremism.

But as Wilson points out, that insight still leaves us far short of having the engineering skills to design and operate better governments, societal structures, etc.

8 Anonymous August 24, 2017 at 5:49 am

We cannot not do design. The only question is whether we should try to optimize our designs. A surprising number oppose that. They prefer reduction to solution.

Even more sadly the trend seems to be to have no plan, and when no plan fails, blame (((globalists))).

The bright young alt-right can’t figure out why red state tax and government cuts didn’t bring prosperity, and they are angry. Maybe the President too, for the same reason.

It is just so frustrating when not having an actual plan fails.

9 TMC August 24, 2017 at 8:34 am

“They prefer reduction to solution.” “have no plan”

You go, within a sentence, from the explanation to not understanding. The plan IS reduction. Get out of our lives. The Federal government has no place in the daily lives of Americans. We want all the busybodies to eff off.

10 Anonymous August 24, 2017 at 9:28 am

Where is that working?

As I say, I see amplified anger by the small group who think no plan is a plan, and can’t come to grips with failure.

11 Hwite August 24, 2017 at 9:29 am

“The bright young alt-right can’t figure out why red state tax and government cuts ”

The alt right hardly cares about that stuff. Have you ever tried actually reading it?

12 Anonymous August 24, 2017 at 10:04 am

Of course, I am responding to what they say. “Why can minorities get hired, and not me? Where is my white privilege?”

If the employment picture is hard, maybe you need a jobs strategy. A government policy.

Because, to oppose jobs programs as too socialist, and then blame progressives for no jobs is kind of idiotic.

13 Anonymous August 24, 2017 at 10:46 am

Reality is not optional. Either the jobs programs add net jobs, or they don’t. Either tax and regulatory reforms add jobs, or they don’t. And at what cost?

14 Hwite August 24, 2017 at 12:01 pm

Again, actually read it.

15 Anonymous August 24, 2017 at 1:05 pm

Other Anonymous, yes. Models, A-B tests, RCTs, should all be encouraged. If we tested more we could certainly save on things that don’t work, and find some that do.

Hwite, I am fine with the William Wilson piece, but I am interpreting it in a context: the complaints of those alt-right interviewed about “why did you come to Charlottesville” specifically.

16 Thomas August 24, 2017 at 5:49 pm

Why should a young white man see a jobs program that will be explicitly racist and sexist against him, as a solution to his own employment situation?

17 Anonymous August 24, 2017 at 10:09 pm

Thomas, I am badgering the right to provide solutions.

They can’t because they don’t know how to do it in an unbiased way? Or they don’t know how to do it at all?

18 Anonymous August 24, 2017 at 10:48 am

“can’t figure out why red state tax and government cuts didn’t bring prosperity”

lol, where did this happen?

19 kb August 27, 2017 at 12:39 pm

Kansas

20 Harun August 24, 2017 at 11:02 am

Government cuts and pro-market reforms in China led to serious job growth.

Singapore is pretty so-con and red-state in some ways. Sure, its not libertarian, but its also not exactly a bleeding heart welfare state.

Hong Kong, Taiwan, etc. are pretty small government..again they have more jobs and growth than say, big government southern Europe.

A key issue is that you now compete globally.

21 Anonymous August 24, 2017 at 1:10 pm

Go back to the Wilkinson piece on Wagner’s Law.

Government grows with prosperity.

https://niskanencenter.org/blog/cant-make-government-smaller/

22 Harun August 24, 2017 at 3:45 pm

Really? So North Korea must be very prosperous.

I do agree that as countries get richer, somehow the government gets bigger, but I think this is merely correlated but not caused.

23 Anonymous August 24, 2017 at 10:14 pm

The North Koreans have a lot less government than we do, on a dollar basis.

But that’s the point, they have a lot less of everything. They haven’t figured out how to do a democracy and capitalism at the same time.

The most productive economies in the world all balance the public and the private.

24 Doug August 24, 2017 at 1:19 am

> These aspects raise an uncomfortable possibility for libertarians: is there a sort of law of conservation of coercion in well-functioning societies? A community with a minimal state can only function if it is thick enough and homogeneous enough to enforce sanctions for antisocial behavior that are almost state-like in their severity

The author’s drastically downplaying the qualitative differences between state coercion and social convention.

For example in the civilized world, we have socially, rather than legally, enforced dictates about sex toys. Keep them in the bedroom, out of public view, and don’t blast your gross fetishes in the faces of uninterested parties. Yes, if you’re cavalier about leaving your sex toys out, your neighbors may make fun of you, and you could feel embarrassed. But in Alabama (where sex toys are illegal) commandos could kick in your door in a pre-dawn raid, with the objective of throwing you in a cage, possibly shooting you or your dog in the process.

As someone who’s done more than their fair share of illegal activities, I can say living on the wrong side of the law really really sucks. Even if the chance of actual apprehension is de minims, it can be very paranoia-fueling and anxiety-inducing. Leaving in fear for your life and freedom are not the same thing as feeling socially awkward. I don’t think any one who’s actually lived in fear of the state would disagree.

25 Ricardo August 24, 2017 at 1:45 am

True, but let’s introduce employment and business opportunities into the mix. One of the main goals of people applying social sanctions is to try to get someone fired from a job and rendered unemployable. A significant decline in income and social status is a pretty frightening prospect for a lot of people. A libertarian society with a minimal safety net would make this even more so.

26 Doug August 24, 2017 at 2:19 am

I agree with your sentiment. Our obsession with pitchfork-wielding social media mobs is probably one of the ugliest warts on modern culture. Trying to get someone fired or evicted is pretty indefensible for all but the most heinous actors. Our society is increasingly too cavalier about it.

That being said, very few things destroy one’s career prospects to the same extent as a felony charge. And way way more people lose their job or prospective job for legal reasons than for social pressure. For every James Damore with a viral memo, there’s about a thousand people arrested for mailing a sheet of LSD. The former takes a concerted effort by a distributed mob, the latter just takes one cop who’s having a bad day. At worse downgrading legal sanctions to social sanctions would only result in the same set of anti-socials losing their job. At best it would involve several orders of magnitude less.

And not to beat the horse of a libertarian trope, but government meddling is a major reason that employers are so risk-averse in the first place. The cost of a bad hire is extraordinarily hire, mostly due to labor market regulations. Scaling back state intervention, including in the labor market, would result in much more flexible employers, willing to take a risk on someone even if they have a few compromising pictures on Google.

27 Anon7 August 24, 2017 at 3:58 am

Sex toys, drugs, and labor market regulations. That’s 3 libertarian tropes.

28 Alistair August 24, 2017 at 6:00 am

Guns. You forgot guns.

29 Anon7 August 24, 2017 at 12:54 pm

Guns are sex toys to a libertarian.

30 Alistair August 24, 2017 at 6:00 am

I suppose in a libertarian society such a job loss might not be too catastrophic because you could most readily find alternative employers who would hire you BECAUSE of your minority views, like in Nazi-town or whatever. Or else you could find another libertarian state where your minority views constituted the majority.

Libertarianism allows for easy self-selection into compatible groups. This has been the norm for most of human history and removes a LOT of the frictions of getting along together.

31 Anonymous August 24, 2017 at 6:26 am

For most of human history, if you were not in a compatible group, you just died. One reason we are actually so flexible at adopting in-group beliefs.

Shut down government to build a wall?

It’s not about a wall, it’s about a political identity. If your community goes with it, you probably will too.

32 Alistair August 24, 2017 at 6:38 am

Yes, agreed. Humans are pre-disposed to relatively small cohesive in-groups.

Unfortunately, a lot of present political discourse treats this as a hate fact.

33 Anonymous August 24, 2017 at 6:40 am

I think history has shown in-groups to be hugely scalable. There are billions in a couple nation level identity groups.

34 Alistair August 24, 2017 at 8:01 am

>> History has shown in-groups to be hugely scalable. There are billions in a couple nation level identity groups.

Respectfully, this need refinement. In-groups can certainly grow to very large populations, but all large populations aren’t necessarily in-groups. You can’t assume they are arbitrarily scalable.

China has high ethnic / cultural cohesion with a cheerful Han racism.

India has moderate ethnic and moderate-low cultural cohesion.

China appears more cohesive and ordered than India on most metrics. Former Soviet Union is your classic large population that is not at all cohesive. 2017 United States is…?

35 Anonymous August 24, 2017 at 9:33 am

The good old USA became, in the words of the Trump administration, a hyperpower, based on a buy-in kind of in-group. Become an American and you are.

Jeez, just a few years ago the Party of Bobby Jindal got that. Now, they seem committed to throwing it all away for a Trump style bankruptcy.

36 Hwite August 24, 2017 at 9:39 am

“Shut down government to build a wall?

It’s not about a wall, it’s about a political identity. If your community goes with it, you probably will too.”

So, I take it you think the Democrats should fund the wall to avoid the shutdown?

37 Hazel Meade August 24, 2017 at 9:56 am

Humans are predisposed to lots of things that aren’t very adaptive in the modern era.
Humans are predisposed to sexual violence and polygamy. The institution of marriage exists to suppress and regulate those predispositions.

38 Anonymous August 24, 2017 at 10:06 am

Lol, no Hwite.

Trump holding himself hostage is brief comedy, but won’t last.

39 Alistair August 24, 2017 at 12:27 pm

>> Humans are predisposed to lots of things that aren’t very adaptive in the modern era. Humans are predisposed to sexual violence and polygamy. The institution of marriage exists to suppress and regulate those predispositions.

Sure. And marriage and attendant legal architecture is near-universal in human culture but only reduces the incidence of polygamy and sexual violence.

So the analogy here is that we can’t expect to eliminate human in-group preferences without incredibly strong state or social controls? It’s wishful thinking to believe it we will become better people and it will just happen?

40 Hazel Meade August 24, 2017 at 3:12 pm

Marriage hasn’t proven to be an unstable equilibria. Maybe the end result is that some people will still tend to be tribal, but they’ll be a marginalized minority.

41 Alistair August 24, 2017 at 5:46 pm

Remind me what proportion of US marriages currently fail? And what proportion of children are born outside marriage?

Seriously, yes, it sorta works. But it only mitigates rathers than stops the evils you list, at considerable social expense in enforcement costs. Obviously we feel this is a price worth paying; but the point is you can’t expect to even reduce deeply ingrained human behaviour without using a LOT of expensive social or governmental force. Are you willing to pay that cost?

42 Thomas August 24, 2017 at 6:04 pm

When the Republicans wouldn’t do what the Democrats wanted and it resulted in a shutdown, unbiased NPR, CNN, Washpo, and NYT blamed the Republicans. When the Democrats won’t do what the Republicans want and it results in a shutdown…

43 Anonymous August 24, 2017 at 10:16 pm

Thomas, the Republicans control the government.

Why are you whining for Democrat votes?

44 Hazel Meade August 24, 2017 at 9:37 am

This is what I was thinking. Perhaps Neo-Nazis would be relegated to living in white-supremacist enclaves, sort of like Medieval Jews in Europe.

45 Alistair August 24, 2017 at 1:24 pm

There is a satirical sci-fi short waiting to be written here. The story can go several ways…

46 prior_test3 August 24, 2017 at 1:53 am

‘we have socially, rather than legally, enforced dictates about sex toys’

You haven’t been to Rotterdam, have you? https://www.sculptureinternationalrotterdam.nl/en/collectie/santa-claus-en

47 msgkings August 24, 2017 at 1:58 am

You say that like it’s a BAD thing…

48 prior_test3 August 24, 2017 at 3:02 am

About being in Rotterdam? Rotterdam is a nice city to visit, proud of itself in a way reflected along the lines of this sort of observation – ‘We earn the money in Rotterdam, it gets taxed in the Hague, and wasted in Amsterdam.’ And the Boijmans van Beuningen Museum would not feel out of place in either DC or NYC.

The Netherlands has a number of interesting places to visit – Utrecht is nice too, though no need to be alarmed about the UFO.

49 TMC August 24, 2017 at 8:51 am

You shouldn’t take your kids there though.

50 TMC August 24, 2017 at 8:52 am
51 Harun August 24, 2017 at 11:07 am

ROTTERDAM

Not Rotherham.

Although, if Netherlands becomes more Muslim, maybe they will have more illiberal social policies.

52 TMC August 25, 2017 at 10:01 am

Read fail. My bad on that! Apologies to the Netherlands.

53 Alistair August 24, 2017 at 8:02 am

Can you imagine what a central committee designing such things would do?

*shudder*

54 Benny Lava August 24, 2017 at 11:14 am

God I love these comments. Libertarians don’t care about unemployed losers unless they are Nazis and then out come the tears! Oh boo hoo!

55 Doug August 24, 2017 at 12:07 pm

An under appreciated fact about Nazis in 2017 is that a significant proportion of them are mentally ill. Not in the sense that “only a mad man could be that evil”, but legitimately schizophrenic. As Scott Alexander says, there’s not a neurological difference between a paranoid-schizoid who thinks the CIA or lizard men are out to get him, vs. one who thinks the Elders of Zion are.

In modern-day American, there’s at most maybe five thousand active neo-nazis across the entire country. About 3 million Americans have schizophrenia. Let’s say half aren’t managed well. Let’s say half are white. Let’s say 5% of those have latched on to Jews as the primary object of their psychosis. Let’s say 10% of those will join an active neo-nazi group. That would imply that 75% of active neo-nazis have mental illness. This isn’t hypothetical, for example Dan Burros, George Rockwell’s right-hand man, was clearly mentally ill.

You’re on board with the anti-nazi, dox-em and get em’ fired crowd. Are you comfortable, that with pretty decent probability, you’re doing this to someone who’s decisions are being driven by severe schizophrenia? Essentially kicking a sick man in the depths of his illness. How would you feel about a public-shaming website that found videos of people having psychotic or nervous breakdowns, then publicly hosted them along with their personal information for the entire world to see forever?

56 Benny Lava August 24, 2017 at 1:02 pm

Evidence?

57 Millian August 24, 2017 at 2:20 pm

There’s no evidence. Just an anonymous blog by a shrink who thinks he is a Time Cube style expert on everything based on reading a few papers.

58 Hazel Meade August 24, 2017 at 2:02 pm

You’re probably right that a disproportionate number of neo-nazis and white supremacists are mentally ill. Mentally ill people always tend to wind up on the fringes of the political spectrum. The left has it’s fair share of lunatics as well.
Maybe not 75% though. How could they manage to organize a rally if 75% of them were certifiably insane?

What are we supposed to do with mentally ill people with wierd political beliefs though? We definitely don’t want to treat them as harmless idiots – there’s quite a recent track record of crazy people with guns shooting innocent people. Involuntary commitment? Is that better than public shunning?

59 DevOps Dad August 24, 2017 at 2:34 pm

“That would imply that 75% of active neo-nazis have mental illness. This isn’t hypothetical, for example Dan Burros, George Rockwell’s right-hand man, was clearly mentally ill.”

Yes, and some are members of Mensa International, yet had behavioral problems throughout their lives.
http://murderpedia.org/male.H/h/haynes-jonathan.htm

60 2nd str August 25, 2017 at 1:16 am

Maybe it’s better to reduce the number of potentially violent racists in the world rather than to cement the racist and possibly catalyze those beliefs into action.

Dr. Poussaint a professor of psychiatry at Harvard Medical School, Boston, says this:

“Anecdotally, I have known psychiatrists who treated patients who projected their own unacceptable behavior and fears onto ethnic minorities as scapegoats. Often, their strong racist feelings were tied to fixed belief systems impervious to reality checks, reflecting symptoms of mental dysfunction. These colleagues have told me that as their patients became more aware of their own problems, they grew less paranoid – and less prejudiced.” And he suggests that, “It’s time for mental health professionals to examine their resistance to accepting extreme racism as a symptom of serious mental illness. Such a focus in the future may prevent tragedies like the Charleston massacre.”

But, that’s not as fun as punching a nazi or doxxing or burning a witch, or whatever. And I’m fairly certain you’ll find vigilantism in the DSM if you look hard enough. But of course it’s always the other people that have problems, never ourselves.

61 A clockwork orange August 24, 2017 at 1:41 am

Schiff heard by people, it’s a pahu taboo. Many gutchess companies been distilling false avon inhales.

62 prior_test3 August 24, 2017 at 1:47 am

‘Freeing individuals from their smothering parochialisms will lead to a compensating increase in the scope and reach of the state as people search for a new solution to social dilemmas formerly handled via informal means. ‘

Yet another person with apparently absolutely zero faith in the 1st Amendment.

‘the best current example of a state built on hard-nosed pragmatism is Singapore’

Including straightforward censorship – https://en.wikipedia.org/wiki/Censorship_in_Singapore Obviously, Singapore is not the U.S., but their attempt to pragmatically use the power to censor in the government’s self-defined interest is something that is utterly incompatible with the 1st Amendment. Few nations have ever had America’s demonstrated and successful devotion to free speech, where the government stays out of the marketplace of ideas.

‘Perhaps the real ideological blinders are those which tell us that we have transcended this condition and can replace it with something else.’

So, to reconsider, perhaps he really does support the truly revolutionary nature of the 1st Amendment, while defending it in a strangely vapid fashion.

63 msgkings August 24, 2017 at 2:01 am

Oh do shut up, Portia.

64 prior_test3 August 24, 2017 at 3:03 am

Portia? I thought I was a puffin.

65 msgkings August 24, 2017 at 12:50 pm

Your obsession over Tyler’s dis is sweet ambrosia to me. And again, the dis was not about you being a puffin.

66 Alistair August 24, 2017 at 6:07 am

One can love the first amendment but still realise it’s an unusual and rare phenomenon with an uncertain future.

The argument is that there have been a LOT of first amendment-style entries in various constitutions over the years; we have data here! Many of them have “failed” in the sense of being gutted, ignored, or repealed. State “diversity” seems, prima facie, to explain some of that variance in their collapse.

Now, maybe the US has indeed hit on the magic formula, which can be replicated everywhere to the betterment of humanity. But this is self-flattery, so we must be cautious. We have to at least consider the horrible thought that free speech is an endogenous not structural property of the state it exists in.

67 derek August 24, 2017 at 1:54 am

5.5 million and 719 sq km. A mid sized city. What bearing does that have on anything? Compared to cities of equivalent size, how does it compare?

Scale matters greatly.

68 msgkings August 24, 2017 at 2:03 am

+1, how many times are people going use Singapore as a useful comparison for any actual country of size? Nothing of value in it.

69 Alistair August 24, 2017 at 6:23 am

The median country size is 8M people and 100,000 sq km .

Singapore is 5.6M and 700 sq km. 1.3x and 14x times smaller.

The US is 320M and 9,500,000 sq km. 40x and 95x bigger.

Singapore is much closer to a “typical” size country than the US is.

70 Anonymous August 24, 2017 at 6:48 am

What is the median size of superpowers?

71 dearieme August 24, 2017 at 7:27 am

zero.

72 Anonymous August 24, 2017 at 7:57 am

Lolz, was that a telegram from an ex-superpower?

73 Alistair August 24, 2017 at 9:13 am

My bad: I meant Singapore at 140x smaller in land area.

Still, if population and land area are orthogonal (for convenience), then Singapore is “13x smaller” than a median country and the US is “61x bigger”. Singapore is still much close to a median sized country than the US.

74 dan1111 August 24, 2017 at 2:59 am

I think the central premise here is completely untrue.

Different societies have vastly different amounts of coercion; they do not all have similar amounts of coercion, just in different forms.

In the real world, I see no evidence of an inverse relationship between amount of coercion from government and “coercion” from social norms. In fact, the opposite relationship appears true to me. Many countries with oppressive governments also have very high social expectations for conformity. This might be because a culture that does not place a premium on individual rights is unlikely to develop strong democratic institutions; or it might be because coercive government tries to impose its will in society; or both.

75 Alistair August 24, 2017 at 6:31 am

Unfortunately, there isn’t much evidence for states with low social coercion. It’s a very modern phenomena.

76 Massimo August 24, 2017 at 4:12 am

The State is indeed most often born as an answer to the tragedy of the commons of kinship societies. The example of the two factories is good, even if the most common case refers to the use of the land. But the mistake in my view (and the Spencer Heat and Spencer McCallum writings, to which I subscribe) is to consider coercion as a “legitimate” alternative to kinship, for it exists a third option that can fix those problems without introducing coercion (which is a pathology, rather than an alternative state of a community of free men): the proprietary community. One of the best examples is the English manorial system before the conquest of William in 1066. The manorial and feudal system look pretty similar, but there was a huge difference: peasants were not serfs linked to the land, like a forest or a source of water. They were free citizens that could move whenever they want to another manor, provided they could reach a contract (usually some share of the harvest) with the owner of the land. This difference of course made them clients, not citizens-cattle, and nobles had to compete among themselves for the clients.

It is true and false at the same time that the owner of a proprietary community performs a job as menial as maintaining the sewer (which, by the way, he typically does). Because it is true that he performs just a set of functions, and if he wants to do (and charge for) what the citizen-clients consider more than the minimum necessary, he would lose clients and get bankrupt. But he does perform three critical functions for any community: 1) selection of members, 2) day-to-day management of the conflicts based on flexible common and business sense, instead of fixed rules, and 3) change in the use of land, typically when the lease contract are due, without using eminent domain (that could anyway be negotiated as part of the contract.

The first is pretty straightforward. Let me give you an example of 2) and then of 3).

Let’s start with 2): in a commercial mall there is usually an agreement that store-operators park their car in the farthest places of the parking lot to leave the best place to the clients, that do not occupy the spot all day and are, after all, the most important agents of the relationship. Let’s stipulate that a a store-operator very liked by all the community breaks his legs and asks for an exception: the possibility of parking close to his store for 30 days, until the cast is removed. In a subdivided community, where the ownership is fragmented, there is usually the HOA to manage this issue. If even one other store-operator out of 200 decides to stick to the rule because he is a jerk, there is nothing to be done. If there is a proprietor of all the mall, instead, the guy would quietly approach the jerk and tell him something like this: “Look, you are formally right, you can invoke the rule and impede to the guy to park close to his store. However, if you do it, most of my clients will be upset, and the rents I can charge for my asset will be lower. So, if you stick to your inflexible position, be sure that as soon as your contract is due, I will kick you out from here, and that action, contrary to lower the value of my asset, will increase it, because the other tenants will consider my decision just and fair”. You can easily make other examples that refer to residential, or office or industrial community, as well as complete communities, like a proprietary city-state.

Example of 3): Currently most malls have the problem of the department store closing due to e-commerce, but the department store is the heart of a mall, when it closes, the mall starts to wither. So much so that in a few cases in the US, malls are charging negative rents to department stores, they are paying them to stay open. This is possible in the real world only when there is only a single owner and stores operated by tenants, because in a subdivided community, not even a HOA could force single tenants to give up their space or pay a monthly fee to keep the department store, it would be a prisoner dilemma including 200 players, a nightmare. This example, by the way, is historically very relevant, because it is at the root of the degradation of inner cities. There was little parking downtown, nobody wanted to invest in parking lots, and suburban malls started to develop. Or some store closed, nobody rented the place and it became abandoned, creating a self-sustaining degradation of the inner city because of urban blight.

So, what about a world of proprietary community, likely city-states listed in some stock-exchange (the quantity of money required is so large that it would be difficult to see as singles can raise it)? It would not be democratic: the owner (or professional manager) might decide to consult his tenants for things like who they want to become the sheriff, for example, but not for more important things, like, for example, who to evict to build a needed new airport. But the decision must make sense and be considered fair, because the owner has to maintain a reputation of a reasonable guy. So, in the airport case, for example, he might decide to cut short leases and use the eminent domain, but it will be careful to choose the most logical place for the airport and compensate the leasees with, say, two times the value they lose losing the lease. Also, different communities will cater to different group of people. For example, a community catering to young families, might very well to introduce a rule against the use of drugs or the ownership guns. It seems counterintuitive from a libertarian perspective, but it actually makes a lot of sense: the rights are all descendant of the right of private property. In the home of my friend, I have to follow the rules established by my friend, I cannot, say, smoke, if he doesn’t want me to. So, what about the expected rebuttal that this would be a dystopian world with 50.000 dictators, without liberty? Liberty, of course, will be guaranteed by the fact that there will be 50.000 agents in competition. We do not say that the shampoo world is divided in 500 dictators that decide what shampoo we want to use, because we trust competition to create all the types of shampoo that can be reasonably created. The same it would be for the production of environment, that would be a good definition of the job of the people involved in the proprietary communities industry.

77 Anonymous August 24, 2017 at 11:51 am

Such a system would have to provide for defense, and environmental protections, which seem like challenges

78 Massimo August 24, 2017 at 1:49 pm

Good questions. Environmental protection would be managed by a simple tort system. Given that it is all private property, there is always an incentive of raising the hand with a polluter. There will be supracommunal systems of arbitration and each community would be very incentivized to follow the ruling of the arbitrators, in order not to be shunned by the other communities and very likely lose its clients. it would be very difficult, I grant you, the management of pollution at global level, like the ozone layer or global warming, if it turns out that such a thing exists.

Regarding defense, you have to consider two scenarios: one is the final situation, when the entire world is comprised of private communities. At that point, war would be virtually eradicated. There will be no tenant willing to pay for expensive wars: if the community he lives in wins, the advantages would be for the owner, if it loses, the tenant might end up bombed by the enemy, and the fees to live there would be in any case exhorbitant, war is expensive. War-mongering community owners would find themselves “king of the pumpkins”, a great expression used in some ancient clan systems in West Africa, to indicate the chieftains that manage badly their clan and lose all the members to other clans.

More difficult is the transition phase, where proprietary communities coexist with traditional states. A traditional state might decide to go rogue and either invade, or more likely blackmail a proprietary community: if you do not pay me, say, one billon per year, I drop a 2 megaton bomb on your main city (this issue is extensively treated by David Friedman in “The machinery of freedom”). My answer is pretty much the anarchocapitalist one: agencies of defense recruited or most likely owned by league of defense made up by hundreds or thousands of private communities. The advantage in military affairs today goes to the richest agent, not that with most population, as it was the case until maybe the First or the Second World War. Private communities should become so much richer than traditional States (because they will attract most of the enterpreneurs) that soon they’ll be able to defend themselves. In the meantime they should not test the Americans with things like free production of illegal (in the US) drugs, play good world citizens and try to buy NATO membership.

79 rayward August 24, 2017 at 8:08 am

“A community with a minimal state can only function if it is thick enough and homogeneous enough to enforce sanctions for antisocial behavior. . . .” Of course, America is anything but homogeneous: it is a sprawling, racially, ethnically, and religiously diverse country. That is both the libertarians’ dilemma and the libertarians’ friend, for achieving national consensus for government action is almost impossible, while diversity invites exploitation of differences by divisive ideologues and politicians. Those who promote public choice appreciate the diversity and how it can be exploited to promote a particular ideology or a particular class. But some threats, to the individual and to the state, are universal, and require diverse people to put their differences aside and take action for the common good; otherwise, the threat can be fatal to the liberty we supposedly hold dear. Unfortunately, ideologues and exploitative politicians put ideology and themselves above the common good; and they, in their selfishness, are a threat to the liberty we supposedly hold dear.

80 TMC August 24, 2017 at 9:00 am

rayward, it’s always been that way. You think Trump is a fascist and I think Obama was an even bigger fascist.

Maybe we can just agree on halving the size and influence of government so neither will do as much harm.

81 msgkings August 24, 2017 at 12:55 pm

Well you’re both wrong as neither Trump nor Obama are anywhere near being fascists. That’s definitely one of the top 5 most incorrectly used words.

82 Massimo August 24, 2017 at 3:53 pm

Jeffrey Tucker on Trump, written in July 2015. He makes the case that Trump is a fascist.

The correct use of the word fascist is to refer to the political ideology of a nationalistic and populist movement born in the late ’10s of last century among the Italian unions. The document that according to the original Fascists best describe fascism is probably “La dottrina del Fascismo” (the doctrine of fascism) a short essay written by Giovanni Gentile and Benito Mussolini in 1932, linked here in English: http://www.worldfuturefund.org/wffmaster/Reading/Germany/mussolini.htm

All the attitudes and believes most commonly attributed to Trump are consistent with this use of the word fascist. Why you think Trump is not “anywhere near being fascist”?

83 Thomas August 24, 2017 at 6:05 pm

Because what fascist means to the lay person is “Nazi”.

That is why the left uses the word.

84 Thiago Ribeiro August 24, 2017 at 8:12 am

“Kuznicki thinks the engineering mindset in political theory is an antidote to what he sees as a philosophical tradition of abstract theorizing that puts the state on a pedestal and makes it into an almost metaphysical nexus of the human condition.”
So long may be the reign of Red China’s fascist leadership?

85 Jason Kuznicki August 24, 2017 at 8:54 am

No. Next question.

86 Massimo August 24, 2017 at 10:10 am

+1

87 William Woody August 24, 2017 at 8:52 am

The problem I see with the idea of using an engineering mindset over a philosophical one is this: what are you making? An engineering mindset helps when building a specific thing–but unless you know **what** you’re building, it’s all just bug fixing and patching and hoping no-one notices you have no clue what you’re doing.

Now if you have a very small community, such as a North American tribe (where most of its members are related in one way or another), or a small American town (where everyone knows everyone else), you can use ad-hoc mechanisms to guarantee order. And the goal of ‘government’–even an informal panel of elders or a strongman who everyone trusts–is to keep the peace.

But those solutions do not scale.

Instead, we need to build a government which scales. But if we don’t know what the goal is, all we’re doing is scaling the unscalable; applying lessons learned from a parent disciplining two squabbling children to large multi-billion dollar international corporations. And if we don’t know what the goal is, we may apply the wrong lessons: applying the lesson that the older child must share his toys with the younger child to a nation like Venezuela.

And applying an engineering mindset to scaling the problem of squabbling children or squabbling neighbors in a small tribe or town simply creates an efficient way to oppress people. Worse, this “engineering” without a goal, divorced (as Kuzincki seems to suggest in this article) from historic or cultural context, doesn’t lead to libertarianism. It leads to over-engineered solutions like we saw in the former Soviet Union, were state planners drilled down into individual lives, forever tinkering (like a mechanic with a car or a software developer with some half-working code) at a lower and lower level, seeing citizens as replaceable cogs in a machine, stripping more and more layers of freedom in order to make the machine work. And if a hundred million people must die–well, you must break a few eggs to make an omelette, right?

Bah.

Have a goal first. Then talk to me about “engineering” a solution.

Now let me suggest a goal: try creating a government which increases Trust between its citizens.

After all, that is what, ultimately, a parent tries with his children: to get them to trust each other. That’s what the tribal elders are trying to do: keep the peace by allowing tribal members to trust the other will do the “right thing.” That’s what motivates banking regulations: that we can trust thousands of our money to complete strangers in an impressive looking building around the corner. It’s what motivates police officers to arrest petty criminals: so we can trust our ability to walk down the street without being mugged. Hell, we have so much trust in this country we allow people to check out their own groceries and buy stuff from the Apple store without talking to a sales rep–but that Trust did not just pop out of the forehead of Zeus fully formed.

But no, none of these damned theorists want to talk about goals, which is why so many of them seem to want to “engineer” or “philosophize” authoritarianism–so as to impose order top-down, even as they pretend they want spontaneous order from the bottom-up.

88 Jason Kuznicki August 24, 2017 at 9:01 am

I felt like I made my views on these questions clear in the book. If you are discussing a summary of a part of it from a review, you may miss a few of the details. Like not cheering for democide, because it happens that I don’t.

89 William Woody August 24, 2017 at 10:01 am

I’m replying to the review, which towards the end seems to treat Trust as a finite resource and never really adequately answers (to me, at least), what we’re supposed to be engineering or what we’re supposed to be philosophizing about. (I’m not replying to your book, which I have not read, and which I suspect is not well represented in this review.)

As a software engineer I do believe a more pragmatic mindset (that engineers and software developers use) is sorely missing in government circles. But the counterpart here is that unless, as a software engineer, I have a holistic vision of the entire product (and not just a snapshot of some module I’m working on), it’s impossible to engineer a successful product. It’s why some 80% of all software engineering fails–with half of those projects resulting in code that is never deployed in the field.

And unlike software engineering (where bad code doesn’t affect customers, just wastes time and energy as months or years of effort is tossed out), government regulations are just one long, continuous “beta test” with millions paying the price for badly crafted solutions.

90 William Woody August 24, 2017 at 10:13 am

As an aside, I wish I could go back and edit my comment as I submitted it, because I had a few typos–including attributing Mr. Wilson’s words to you. My apologizes for my confusion.

91 Roger Sweeny August 24, 2017 at 9:02 am

Technology and the End of Authority: What Is Government For?, by Jason Kuznicki

$100 in Kindle $110 in Hardcover

Seriously?

92 Jason Kuznicki August 24, 2017 at 9:04 am

Yeah, I’m not too happy about that either.

93 Harun August 24, 2017 at 11:12 am

That price is engineered a publisher who knows better than mere writers.

94 Jason Kuznicki August 24, 2017 at 11:24 am

Do they know better? That’s an empirical claim, and I happen to have some evidence about it…

95 Harun August 24, 2017 at 3:41 pm

If you think they don’t know better, you should have self-published on Amazon’s author platform. You can set your own price there.

Disclosure: I am definitely in this camp. I had a choice to sell to Amazon or to sell on Amazon. A big factor in choosing to not sell to Amazon was control of retail prices.

96 prior_test3 August 24, 2017 at 10:37 am

On censorship free LBRY, you might be lucky, and get it for a couple of bucks.

97 Hazel Meade August 24, 2017 at 9:49 am

A community with a minimal state can only function if it is thick enough and homogeneous enough to enforce sanctions for antisocial behavior that are almost state-like in their severity, and, furthermore, can make them stick.

What exactly does he mean by “homogenous”? Most of our new social norms are designed to enforce interethnic tolerance so as to permit ethnically non-homogenous societies to function harmoniously.

98 William Woody August 24, 2017 at 10:26 am

I read “homogenous” as meaning “Tribal” or “of the same Tribe”. Most of the norms in the United States are designed to enforce interethnic tolerance–but such norms are relatively weaker (or even non-existent) in many countries (like the Scandinavian countries Mr. Wilson uses as an example) where people share the same culture, ideas and beliefs. But then, the United States is the exception in the world: founded on a philosophical principle of “life, liberty and the pursuit of happiness” rather than as a tribal group extending its cultural controls in a formal way over a region or territory, as is true in most of Europe.

It also informs the debates: notice in the United States most of our debates seem to revolve around “how can we get along better”–while in parts of Europe (e.g. Basque country or Scotland, just to pick two) the debate seems to be “how can our tribe gain more political autonomy.”

99 Alistair August 24, 2017 at 12:48 pm

I suppose homogeneity includes metrics of difference on genetic, ethnic and cultural lines.

>> Most of our new social norms are designed to enforce interethnic tolerance so as to permit ethnically non-homogenous societies to function harmoniously

Yes. Which leads us back to Putnam and the Singapore Argument. Low-homogeneity societies (for some measure of homogeneity) have low inter-group trust and require extensive state or social coercion to prevent conflict and manage inter-group exchanges. Its an expensive proposition.

100 Hazel Meade August 24, 2017 at 1:52 pm

Low homogeneity societies haven’t existed for very long. But they aren’t going away either.
Absent doing away with the internet and global markets (not gonna happen), we pretty much have to learn how to build trust across ethnic lines. It’s only going to get easier and easier for people from diverse racial backgrounds to move around the world and settle in other places, to trade with people from far away, and to engage with them in online communities. This process is not slowing down and it’s definitely not going into reverse.

What’s the alternative? On a national level, ethnic nationalism means inevitable violence internally against ethnic minorities – because they aren’t going to just accept second class status, and/or externally, directed against foreign enemies, because an entire country composed of ethnic tribalists – we’ve seen what happens with that before. So national level moves towards ethnic homogeneity aren’t going to work – it’s way too late for that.
On a micro level, individuals may be able to isolate themselves in ethnic enclaves, but they’ll be stunting their own economic development if they are cutting themselves off from economic exchanges with other ethnicities. The ethnically tolerant and diverse places will benefit from specialization and trade, become more efficient and more prosperous, and ultimately outcompete local ethnically homogenous enclaves. Individuals simply can’t afford to be racist. The costs of being racist in terms of cutting oneself off from trade with other ethnic groups are much higher than the costs of becoming racially tolerant.

101 Alistair August 24, 2017 at 5:30 pm

>> Low homogeneity societies haven’t existed for very long. But they aren’t going away either.

That’s what they said about Yugoslavia….

Seriously though, there have been a lot of low homogeneity societies. They’ve just been held together by rather large amounts of coercion (see Russia, Austro-Hungary, Aztec Empire, Empire of the Golden Horde, etc etc). Low coercion AND low homogeneity; now that’s something new.

102 Alistair August 24, 2017 at 5:41 pm

I do think you travesty ethnic Nationalism though. There’s a huge difference between patriots and nationalists. It’s the difference between secure and insecure love. Respectfully, the lesson of WWII was that the fascists were themselves defeated by an alliance of patriotic nationalists fighting for survival; not some rainbow-coalition fighting for abstract ideals. Even Soviet Russia found it useful to stress the Russian bits more than the Soviet.

Overall, I think you vastly, horribly, underestimate the effects of social cohesion and trust on economic performance and growth and overestimate gains from market scale. Not to mention military performance. They are first order effects. Even if you conflate “isolation from out-group” with “does not trade with out-group” as above (how does Japan fit into that model?) the trust effects are considerably bigger than the “market size” effects..

103 Roger Sweeny August 24, 2017 at 6:52 pm

Kenya has lost many of its Indians and Zimbabwe is making life difficult for whites.

104 Hazel Meade August 25, 2017 at 11:37 am

How do you propose to get rid of all the non-homogenous peoples already living in the US and other places around the world? Ethnic cleansing?
Whether you like it or not, the world’s populations are going to become increasingly mixed.
A future of segregated ethnically homogenous nation states isn’t likely to reduce conflict either. It might lead to more conflict between ethnic nation states – as it has in the past. You have more trust within states and less trust between states.

If we’re going to live in reality, in which ethnic mixing is inevitable, the only real solution is to develop social norms which support inter-ethnic trust, until maybe we get to the point where the “in-group” spans ethnicity and ethnicity fades and blends into a new whole. I’m not underestimating the effects of social cohesion at all. The whole point of anti-racist social norms is to develop social cohesion between diverse racial groups.

105 Roger Sweeny August 24, 2017 at 6:13 pm

So national level moves towards ethnic homogeneity aren’t going to work – it’s way too late for that.

The Arab world is getting more homogeneous as Jews and Christians are being pushed out.

106 Hazel Meade August 25, 2017 at 11:23 am

Yes, and that involves a lot of violence. A future of ethnically homogenous states is a future of increased conflict and violence, not less conflict and violence.

107 RPLong August 24, 2017 at 10:29 am

I guess I’ll have to be the one to remind some of us that the goal of a libertarians society is not no government, but rather competing governments. There is no need for oppressive social norms or social homogeneity if there is adequate competition in the provision of services traditionally attributed to governments.

108 Jason Kuznicki August 24, 2017 at 10:50 am

One of the goals of the later sections of my book is to point out that “no government” is a much harder thing to conceptualize than we generally imagine. Private protection agencies are not no government; they are multiple governments, competing (ideally) on price. They would still have the power of coercion, and presumably they would still use it, not always for the good. Whether they provided better or worse justice is an empirical question, one that we don’t have much data about.

One thing that’s clear, though, is that “no government” doesn’t look like them. (And certainly not like Somalia, where multiple governments compete, and not on price.) “No government” would look like social norms that are widely shared and enforced through individual convictions and wholly voluntary mechanisms of dispute resolution. I don’t think we know how to do that, but it would be good to try to figure it out, if we can.

109 William Woody August 24, 2017 at 11:40 am

“‘No government’ would look like social norms that are widely shared and enforced through individual convictions and wholly voluntary mechanisms of dispute resolution. I don’t think we know how to do that, but it would be good to try to figure it out, if we can.”

I don’t think this is possible. Even if we succeed in increasing trust and cooperation between strangers, you will always have the problem of the mentally unstable and those who simply have little understanding of the social compact. (You already see this in places like Los Angeles. As crime rates fall in Los Angeles, a greater percentage of crime is being committed by those with mental health problems. So the LAPD is spending more time training officers on mental health issues. Source: an LAPD police officer friend of mine.)

110 RPLong August 24, 2017 at 11:47 am

I don’t think such a thing is possible in a world in which people have spirited arguments about whether Chevy is better than Ford. People like to disagree. People like to have their individual preferences, even among things that “feel” as though they might be universal, such as social norms and institutions. To me, the beauty of the market is that competition ensures that the best set of options rises to the top, and that there are always alternatives available. I’d like to see that also be a characteristic of political systems.

111 Steven Kopits August 24, 2017 at 1:19 pm

Government, like language and agency, arises when there are increasing returns to scale.

If I can kill and eat X working alone, but can kill 10x working in a group of five, then in theory I can double my consumption by cooperating as a part of a team.

Well and good. But two immediate problems appear. First, the group will require specialization: leadership (where do we go for prey, how do we attack it), and functional specialization (spear throwers versus bush beaters). This then implies agency — putting your role over your personal inclinations. For example, suppose you’d like to be a spear thrower, because it’s more prestigious, but the team needs a beater. Well, you become a beater unless you have…that’s right, pull with leadership. You have to adopt agency (a conservative concept) and suppress being a principal (a liberal concept).

And of course language evolves because you need that to coordinate the team.

Now, how will those 10 killed prey be split among the group? Leadership will decide, and Adam Smith tells us that leadership will prefer itself over others. Thus, leadership will ordinarily assure that lower group members have enough to remain in the group but not a full share. Therefore, 10 killed prey divided by 5 team members might come out 3 for the leader, 2 for each of 2 spear throwers, and 1.5 each for the 2 beaters.

Note that the two beaters are lower class, below the median. What will be their evolved specialty? Whining. That’s what egalitarians do. They will become the bleeding heart liberals.

The bigger the group, the less the connection between the leader and the rest of the team. It becomes all garden variety dictatorship.

So, that’s conservative theory in a nutshell. It’s all about increasing economies of scale, specialization, the group as the unit of analysis, and the allocation of risk, effort and rewards (‘culture’) as the central focus of politics.

112 Alistair August 24, 2017 at 1:48 pm

But the whiners can co-ordinate and stage a revolt. We’ll see who gets 3 deer apiece now!

Robin Hanson has a lot on virtue signalling being evolved to co-ordinate the whiners for “raids” upon other coalitions in the group. Although the group co-operates overall, there’s intense awareness about the distribution of inter-group spoils and paranoia about the emergence of a powerful elite that cannot be deposed.

113 Alistair August 24, 2017 at 1:49 pm

Meant “INTRA-group spoils”

114 Steven Kopits August 24, 2017 at 2:01 pm

Whining is a permanent evolved strategy. If you’re receiving less than the median, they you’ll want to place the emphasis on how we’re all equal and should receive equal shares. That’s pure Marxism. I have little doubt that you could identify this behavior in a pod of orcas or a troop of monkeys.

If you’re a spear-thrower, you’re going to be part of the Silent Majority, ie, you’re reasonably well paid for your work and a distinct loser from egalitarianism. You’re going to focus on your job and not rocking the boat too much.

For leadership, it comes down to sharing or suppression. In a large group, that human angle in lost, so it comes down to whether leadership can take a bigger share through suppression or through concession. The existence of the monopoly of power by the state suggests that returns to the out of power will be less than would be achieved in an impartial (say, free market) system. A certain level of dissent is optimal if you’re the dictator.

115 Alistair August 24, 2017 at 5:20 pm

>> The existence of the monopoly of power by the state suggests that returns to the out of power will be less than would be achieved in an impartial (say, free market) system. A certain level of dissent is optimal if you’re the dictator.

Indeed. What’s the point of a monopoly if you can’t use it to extract rents?

116 Massimo August 24, 2017 at 2:17 pm

Jason, first, thanks to be here, it is great to be able to discuss with the author.

I agree that a polycentric system of security, with different protection agencies in the same territory is very difficult to imagine. The specter of gang wars is an issue, but I think the main issue would be the production of law: all the agencies should agree on the same “natural” or whatever law, which is not straightforward at all.

But assume for a moment a Nozickian situation where there is only one protection agency dominating a specific territory, but there is the exit option for people, e.g., these protection agencies would find too expensive to maintain captive their subjects, that would freely migrate to territories dominated by more reasonable and cheaper protection agencies. You are basically defining a world where the base of society is not kinship or coercion, but contract. In such a world you could actually use for the first time the phrase “social contract” without it being a joke, because each single person would sign a contract with the agency (or the owner) of the specific territory. I posted in this thread a (probably too) long comment this hypothesis a few hours ago. What do you think would be the problems in such a world?

117 Daisy Alexandrovna August 24, 2017 at 10:50 am

Local coercion is preferable to centralized coercion because local coercion is closer to the classical republican ideal of governing and being governed as part of a community of equals. Centralized coercion must be done by a bureaucracy (or worse) organized according to the iron law of oligarchy, and as such it makes it impossible for a community of equals to engage in the enterprise of self-government.

118 jdbosshog August 24, 2017 at 12:01 pm

Yes, but it is a corollary of the law of conservation of assholes.

119 Steven Kopits August 24, 2017 at 12:50 pm

“Kuznicki invites us…to consider states as just one tool among many that human societies have deployed to solve various sorts of problems.”

The traditional state does not exist to solve problems. It is the spoils for the alpha male. The default form of government is dictatorship, which is a parasitic structure atop the body politic. Democracies are decayed froms of dictatorships owing to the declining marginal utility of wealth and income. That’s why virtually all poor societies are anarchic or dictatorships, and all wealthy societies (other than oil exporters) are democracies. Indeed, within ten years, China’s per capita GDP will put it into a class where there are literally no dictatorships. That’s something to think about.

120 Alistair August 24, 2017 at 1:41 pm

>> “Democracies are decayed forms of dictatorships owing to the declining marginal utility of wealth and income.”

Democracies differ from dictatorships in that the parasite payoff goes to 51% of the population rather 5%. But surely this is a reflection of the distribution of power of agents in the system? If 5% of the population can get all the guns and resolve its internal squabbles, then they will extract maximum resources from the remaining 95% regardless of the utility of those resources to them at the margin.

The decay of medieval dictatorships into modern states sees them liberalise as wealth moves out of the land into the cities and trade creating a new class of gentry with whom power must be shared. The new gentry has wealth that cannot be readily expropriated and talents you can’t compel (not if you want to win your war with France).

The great strength of modern economies as far as democracy is concerned is that chasing/expropriating wealth mostly destroys it rather than transfers it. Capital and skills are mobile and competition for them is fierce. The transfer settlements reflect that.

121 Steven Kopits August 24, 2017 at 2:33 pm

I would highlight that, in this construct, democracy is a process, not a destination. In a US civics class, for example, the distinction between dictatorship and democracy is binary, like a light switch. “Off” is dictatorship, and “on” is democracy. The way it’s taught in school, democracy is natural and good, and dictatorship is deviant and bad. Thus, once you’re a democracy, everything is solved and rosy, because democracies are all good, and they’re a destination. Once you’ve arrived, there’s nowhere else to go. Democracy in Argentina is the same as democracy in Norway.

Well, clearly it’s not.

If instead we start with the notion of dictatorship as normal, then we can view the process of democratization as the gradual decay of dictatorship as power devolves from the core to the periphery, principally through increased wealth and income. This in turn allows us to categorize and map the various aspects of power devolution (democratization) and address the concept of democracy in more dimensions than the simple means by which representatives are chosen. Thus, gay marriage can be taken as the continuing devolution of choice from the group or leadership to individuals, even though it’s not directly related to election of representatives. By taking dictatorship as the starting point, we can put democracy on a sliding scale and start looking at the components individually. This framework allows us to say that Indian democracy is not the same as Chilean democracy, and that’s not the same as Norwegian democracy.

With this framework, who gets the payoff becomes a function of a number of different factors. For example, if wealth is highly concentrated at the top, then the median voter will likely prefer an allocation method which focuses on taking away income from the top, regardless of the impact on the group’s longer term outlook. That’s Latin America, for example. There are other means of allocation as well.

122 Alistair August 24, 2017 at 5:08 pm

Yes. I work on basically that model. It’s median voter theory meets Shapeley Value.

123 Steven Kopits August 24, 2017 at 2:55 pm

To beat this dead horse just a bit more, let me give you an example of how the declining marginal utility of wealth and income affects agency.

In the US, you’d never think of trying to bribe a cop; in Mexico, you’d be a fool not to cough up the dough (I can attest to this from experience). Why are US cops clean, and Mexican cops crooked? To believe conservatives, this is because Americans are fonts of virtue and Mexicans are criminals.

However, we can analyze this quite readily using the marginal utility of income and principal agent theory. For the cop, he would be better off is he pocked a bribe and didn’t issue, say, a speeding ticket. However, it involves the risk of losing one’s job and perhaps going to jail. So the cop has to make a decision: be honest and no bribe, or be corrupt and take the money.

For a Mexican making, say, $8,000 per year, a bribe of, say $80 (to use round numbers) represents 1% of his income. For a US cop making $80,000, it is 0.1% of his income. Therefore, the percent incentive to take a bribe is lower for the American, and hence we obtain better agency, that is, the cop is more likely to do his job than take a bribe.

But it’s more than that. The marginal utility of $80 to someone on a subsistence wage, which is the situation of the Mexican cop, is much greater. This may be the money that allows his children to eat or be properly clothed or receive health care. For the US cop, who almost certainly has health insurance and a pretty decent standard of living even without the bribe, the value of the bribe is much less important, because it does not have such a huge impact on his life.

Thus, agency — making sure people do what they are hired to do — will be much higher in a wealthy country than in a poor one, simply due to the decreasing marginal utility of income.

124 Harun August 24, 2017 at 3:37 pm

Interesting. What happens in places like China, or Washington DC when the bribes are larger than any possible salary?

125 Steven Kopits August 24, 2017 at 4:43 pm

Harun –

Bribes are not larger than any possible salary, again owing to the declining marginal utility of income.

On the other hand, if President Xi’s salary is $22,000 / year, then yes, Chinese governance will be corrupt all the way down.

Here’s how a US performance-based pay plan would look: http://www.prienga.com/blog/2015/3/19/a-bonus-plan-for-politicians

126 Alistair August 24, 2017 at 5:17 pm

Yes, that’s agreeable and in line with some utility maximising theories of social democracy.

I notice you use wealth as proxy for power, but I’d like to empathise other factors in determining the balance. State administrative capacity, sources and mobility of your capital, your potential for armed revolt, and of course simple voting power must be strong determinants of how much you get squeezed in the settlement. Though as you say, it depends on what other people have as well.

There’s an old West End Games boardgame – “JUNTA” – which teaches all of this in a very agreeable way.

127 Steven Kopits August 25, 2017 at 10:47 am

“…you use wealth as proxy for power…”

I am assuming that, at some initial point at least, all the participants are rational utility maximizers. Wealth and income are part of, but not the entirety of, utility.

The declining marginal utility of wealth and income is key to delegation of power and the assumption of agency on behalf of the group. For example, if a lower class person is facing starvation and death if ejected from the group, then leadership will have enormous influence over that person, even if, say, leadership is still not wealthy by modern standards. Thus, if a leader is making $50 / day and a follower is making $0.50 / day, then the leader will have enormous influence over the follower because 1) the follower is right at subsistence, and 2) an uneducated person and therefore more easily swayed by definition.

On the other hand, if the leader makes $100 million / year and the follower makes $1 million per year (again 1% of the leader’s income), the follower is a wealthy person, well-educated with options of his own. There are limits to what the leader can impose upon him. This is, for example, why Bill Gates wears a sweater and Uncle Scrooge wore a stiff suit. Social differentiation makes sense if its feasible. If it isn’t, you might as well dress comfortably.

Culture, capacity, institutional organization — all these matter. However, I am proposing really more a first principles approach here. Just the basics of the analytical framework.

128 Viking August 24, 2017 at 12:52 pm

Better formulation:

Coercion + Self Control (Future orientation) is somewhat constant, where the population has low self control, there will be coercion by despot government (Saddam Hussain’s Iraq, Khadaffi’s Libya), or by despot warlords (Somalia).

European example: As a population with less self control is imported, coercion by government increases.

129 Alistair August 24, 2017 at 1:43 pm

Hush. Next you’ll be saying that economic growth is determined by cultural factors and not openness to capital and immigration…

130 Millian August 24, 2017 at 2:25 pm

Did the Germans suddenly… discover a massive self-control well in 1945?

131 Millian August 24, 2017 at 2:17 pm

Many of the most successful countries have been small, because of the law of large numbers. The same explanation tells us why many of the least successful countries have also been small.

Overall it is hard to reconcile explanations of success from smallness or homogeneity with how rich and successful America has been for the last 200 years relative to the rest of the world.

Comments on this entry are closed.

Previous post:

Next post: