Saturday, September 01, 2007

Encourage Worldwide Economic Competition

Tibor R. Machan

Bob Herbert of The New York Times seems to want job protectionism in America. Why else would he send out a warning, in his September 1st column, to the effect that “American families are trying to make it in an environment in which employment is becoming increasingly subject to worldwide competition.” Yes, and so what? Is this supposed to be a bad thing?

In fact worldwide competition is the best answer to worldwide poverty. The more those who have been left out of reaping economic benefits from work get into the race, the better chance they have of catching up with those who have been enjoying freedom of entry for decades. And that is just what American workers have enjoyed far more than others around the globe, a free market in employment.

Now mind you, there is no fully, consistent free market anywhere and has never been. Some folks have always had certain government-granted advantages at the expense of others. Many of America’s farmers are a notorious example, managing as they do to purchase for themselves political influence that keeps farm goods away from American consumers and thus makes it more expensive for us all to live. It deprives all of us in the market place from the benefit of purchases that might have been made with resources that would have been saved by buying low cost foreign farm goods. And this scenario is widely repeated in other goods and services that gain government protection from competition.

What is wrong with such protection? It involve the coercive exclusion of some market agents from gaining a chance to offer their goods and services to prospective customers. It is like one store in your neighborhood managing to purchase the services of the local police for purposes of shutting down other, competing stores. This approach to commerce is unjust and also leads to people working with the illusion that they are entitled to special privileges. This is a serious source of corruption, like much of professional licensing and all non-competitive distribution of government contracts.

Why does Mr. Herbert seem to favor such a policy? Why does he suggest that the American government ought to put up barriers to entering the market for working people abroad?

Perhaps like some other champions of protectionism, Herbert is a nationalist who thinks that it is fine to impose burdens on non-Americans—as well as millions of American consumers—so as to prop up industry that isn’t cutting it in the world market. This “my country right or wrong” attitude is not only grossly unjust and violates the rights of innocent people abroad as well as domestic consumers but it encourages economic complacency which, in time, will leave American workers lagging behind in productivity and efficiency. Why should one work hard, be ingenious and inventive, if one can keep one’s business going by coercively keeping competitors out of the way?

That policy can only work for a while. In time competitors tend to find ways around the barriers by, for example, making deals with businesses in countries that aren’t being kept out for various reasons—they have favorite nation status or their work is seriously needed here. And by this roundabout method they will manage to undermine the protectionist policies Mr. Herbert and others appear to rely on so as to give a short term leg-up to domestic economic agents.

Sometimes it is useful to look at international sports to grasp the nature of competition. The recent track and field world championships were free of the kind of unjust favoritism Mr. Herbert and others like in the economic sphere. Superb athletes, many of them Americans by the way, were not excluded from competing in various events simply because their superior skill and training made it very likely that they would defeat others in the race. Any kind of protectionism like that would immediately be seen as having a corrupting influence on sports across the globe.

Why won’t Mr. Herbert and other protectionists recognize that the very same results from economic protectionism?

Thursday, August 30, 2007

Besmirching Markets

Tibor R. Machan

As an avid reader of all kinds of fiction—part entertainment, part cultural anthropology—my attention is perked whenever I see authors get sneaky on us. This occurs often when they wish to make a political point but not to take responsibility for doing so. They are too lazy or ignorant to actually argue their case but will not resist laying in with a few nasty licks, probably in the hope of influencing their readers.

One author I have enjoyed reading is the Swedish crime novelist Henning Mankell whose protagonist, Inspector Wallander, is a rather reflective, often a bit moody, bloke with whom it is a pleasure to spend some time, at least for me. However, as narrator, Mankell sticks in some lulus that I’d love to debate with him.

In one of the latest I have read, The Man Who Smiled (1994), Wallander is dueling with a vicious—of course very rich—villain who is involved in murdering people for their healthy organs so he can then sell them to wealthy recipients. When he comments on this in a somewhat slip shod exchange with Wallander, he says, “I buy and sell. I am an actor on the stage governed by market forces. I never miss an opportunity, no matter how small and significant it is.…” Mankell, the narrator, then injects that “Human life is insignificant, then….” Presumably for entrepreneurs, for all those “actors on the stage governed by market forces.”

No character in the book, of course, disputes the villain’s slander of market forces. No one observes that selling organs you obtained my murdering people contradicts every principle of the free market which, after all, relies entirely on voluntary exchanges, including of donated or sold body parts, blood or whatever. Indeed, genuine free trade in such items may be upsetting to some but it contributes immensely to the well being of recipients as well as sellers.

It is elementary business ethics that trade must be freely consented to. It is not actually trade otherwise. All those who deal in stolen goods violate free market principles, let alone people who resort to murder and other bone fide crimes. One reason dealing with dictatorships is frowned upon from a free market, capitalist, perspective is that it risks involving people against their will. Even the welfare state isn’t clean, from a pure free market perspective, since it involves extensive wealth redistribution, subsidies, protectionism, the extortion known as taxation, etc. and so forth, all in violation of real free trade.

When Ayn Rand’s blockbuster novel Atlas Shrugged appeared in 1957, a good many snooty literati faulted it for being too didactic, lacking in subtlety, arguing points explicitly, indeed in lengthy dissertations by her protagonists. This was often deemed to be lacking in finesse, something contemporary novelists must deploy lest they be clearly understood.

No one I have read commenting to Henning Mankell’s well written and plotted crime novels has faulted him for injecting slip shod political economic comments into his works. Somehow doing didactic, not to mention primitive, political economy seems to be OK by novelists if they oppose full human freedom, if they champion the welfare state (which Swedish Inspector Wallander supports wholeheartedly and whose inefficiencies and other faults he tends to blame on various vague cultural influences).

Okay, most novelists aren’t all that bright and savvy when it comes to political economy. They work with their sloppy intuitions and sentiments rather than well educated reflections. So I figure it is not dirty pool for me to report on at least one favorite of one prominent genre who is trying to pull off some literary dirty tricks while entertaining us.

Oddly enough, in another of his pretty good books, The Dogs of Riga, Mankell appears to have grasped well enough some of the evils of socialism. The story unfolds just as Latvia is becoming free of Soviet domination and Mankell seems to know well enough what that glorious egalitarian system does to human community life.

But I suppose he like millions of others dreams of some kind of “third way,” between top down socialist rule and the fully free market. But it just will not wash and his way of sneaking in some nasty intimations about free markets is way off.

Wednesday, August 29, 2007

Tibor Machan's Books:

Single Author Books[31]:
The Georgia Lectures (f/c)
The Right Road to Radical Freedom (Imprint Academic, 2007 f/c)
The Morality of Business: A Profession of Wealthcare (New York:
Springer, 2007 f/c)
Libertarianism Defended (Ashgate, 2005; forthcoming)
Libertarianism, For and Against, w/C. Duncan (Rowman & Littlefield,
The Man Without a Hobby (Hamilton Books, 2004)
Objectivity: Recovering Determinate Reality (London, UK: Ashgate,
Neither Left nor Right, Selected Columns (Hoover Institution Press,
Putting Humans First, Why We Are Nature’s Favorites (Rowman &
Littlefield, 2004)
The Liberty Option (Imprint Academic, 2003)
The Passion for Liberty (Rowman & Littlefield, 2003)
The Right to Private Property (Hoover Institution Pres, 2002)
A Primer on Business Ethics w/J. Chesher (Rowman & Littlefield, 2002)
Initiative: Human Agency and Society (Hoover Institution Press, 2000)
Ayn Rand (Peter Lang, 2000)
The Business of Commerce w/J. Chesher (Hoover Institution Press, 1999)
Classical Individualism (Routledge, 1998)
Generosity; Virtue in the Civil Society (Cato Institute, 1998)
Why Freedom Must be First (Hoover Institution Press, 1997)
A Primer on Ethics (University of Oklahoma Press, 1997)
Private Rights & Public Illusions (Transaction, 1995).
The Virtue of Liberty (Foundation for Economic Education, 1994).
Liberalisme, Ethique et Valuers Morales (Institut Euro 92, 1993).
Capitalism and Individualism: Reframing the Argument for the Free
(St. Martin's Publ. Co. & Harvester Wheatsheaf Books, 1990).
A Dialogue Partly on Political Liberty [w/J. N. Nelson] (University
of American, 1990)
Liberty and Culture: Essays on the Idea of a Free Society (Prometheus
Books, 1989).
Individuals and Their Rights (Open Court, 1989).
Marxism: A Bourgeois Critique (MCB University Press Limited, 1988).
The Moral Case for the Free Market Economy (The Edwin Mellen Press,
1989, rev. [English] version of Freedom Philosophy).
Freedom Philosophy (AB Timbro, 1987).
Introduction to Philosophical Inquiries (Allyn & Bacon, 1977;
University Press of America, 1985).
Human Rights and Human Liberties (Nelson-Hall, 1975).
The Pseudo-Science of B.F. Skinner (Arlington House, 1973; Hamilton
Books, 2006).

Edited Books[17]:
Anarchism/Minarchism (w/R. Long) (Ashgate, 2007 fc)
Ayn Rand at 100 (New Delhi, India: Pragun Publication, 2006)
Liberty & Justice (Hoover Institution Press, 2006)
Liberty and R&D (Hoover Institution Press, 2002)
Liberty & Equality (Hoover Institution Press, 2002)
Liberty & Democracy (Hoover Institution Press, 2002)
Liberty and Hard Cases (Hoover Institution Press, 2001)
Individual Rights Reconsidered (Hoover Institution Press, 2001)
The Commons: Its Tragedy and Other Follies (Hoover Institution Press, 2001)
Morality & Work (Hoover Institution Press, 2000)
Education in a Free Society (Stanford, CA: Hoover Institution Press, 2000)
Business Ethics in the Global Market (Stanford, CA: Hoover Institution
Press, 1999)
Political Philosophy: Essential Selections [w/A. Skoble] (Prentice Hall,
Liberty for the 21st Century [w/D. B. Rasmussen] (Rowman & Littlefield,
Commerce and Morality (Rowman and Littlefield, 1988).
The Main Debate: Communism vs. Capitalism (Random House, 1987).
Recent Work in Philosophy [w/K. G. Lucey] (Rowman & Allanheld, 1983).
Rights and Regulation [with M. Bruce Johnson] (Ballinger, 1983).
The Libertarian Reader (Rowman & Littlefield, 1982).
The Libertarian Alternative (Nelson-Hall, 1974)