Free Market vs. Free Lunch

[ak666]

As a disclaimer I'm not an economist, so I'm going to focus on basic principles instead of complex economical discussions for which I'm ill-qualified. These basic principles should be obvious without a doctorate in economics.

Free Lunch

The main reason I'm writing this article is because I've been concerned about how many people seem to favor the analogical or even literal "free lunch". Many people seem to want free healthcare, free education, free water, and even free food.

So let's examine what "free" means exactly.

No Choice

This is the essence of what "free stuff" means in this context. When government controls and provides these goods and services, even proponents of free things know that it must come out of someone's pocket.

So who will pay for these "free" things? The typical optimistic answer is insanely rich, greedy people stockpiling vast sums of wealth.

Wonderful! Assuming these types of people are in abundance, sign me up for some of the loot from the money we're going to steal.

The one request I have is to just hand me cash directly instead of serving me raw squid guts (not a fan). Don't spend the cash for me, just give me the money directly for me to spend as I need and want.

Let me put myself for a moment in the shoes of the almighty government. I have a question for those who want me, the government, to play Robin Hood and steal from the rich and give the loot to those of us who are less fortunate:

Why on earth do you want me to buy you lunch, when you might not even be hungry, at an overpriced restaurant you don't even like, when I could just give you the money I stole instead?

Why do you think I should spend it for you and decide what food you should have with this money?

By the way, I'll be taking a big chunk of the money for myself given that I'm spending my precious time deciding what you're going to have for lunch.

Why do people prefer this? I can understand why anyone except those who are mega rich would want to steal from the mega rich, but why don't you just want the stolen money?

Why do you want to deprive yourself of the choice of how it will be spent on your behalf?

Corruption

One of the classic arguments against capitalism is that it creates a corrupt capitalist social class who exploits the working class below them. It makes it sound as though an employer is practically a slave owner.

So let's just go with this worst-case scenario of a most corrupt employer who squeezes his employees dry. Instead of distributing massive revenues to his employees, he pockets a massive chunk for himself and pays his employees table scraps.

Now let's compare this to an equally corrupt government. If we're going to assume that humans in power are corrupt and stingy, it makes no sense to assume that your employer would be corrupt but politicians would not.

Just personally speaking, I tend to put more faith in business owners than politicians.

Citizen

What options do we have as citizens under a corrupt government as far as money goes? Governments use force to get what they want from their citizens.

The corrupt government can take as much money as they want from you through taxes or lock you away if you refuse to pay.

About the only option we have to escape from this corruption is to defect to a new country or become criminals who attempt to evade taxes while hoping we never get caught. If we're very ambitious and well-armed, maybe we can start a revolution and overthrow the government at the cost of great bloodshed.

Employee

What options do we have as employees under a corrupt employer? Corrupt employers require the consent of their employees to get what they want from their employees.

We can try to negotiate higher wages. We can collaborate with other employees and go on strike or form a union if our negotiations repeatedly fail. If all such negotiations fail, we can seek another job under a more generous employer.

We can even start a new business with minimum startup capital if the system favors a free market. A decent free market system doesn't require a person to be rich to start a new business.

As a new business owner, you can negotiate wages for your employees and treat them better than the former employer, especially as your business grows. As more such businesses arise, there will be more and more employment opportunities for those working under the former corrupt employer to seek a better job.

You might even have a decent fighting chance to put the corrupt employer out of business under a free market.

Noble Government

Let's be idealists and assume that government is noble for the moment and isn't full of corrupt politicians. How long is that likely to endure? Will the government be noble and efficient 10 years from now? 50 years from now? 100 years from now?

To assume that government will always be noble and do a decent job serving the interests of its citizens could very well be hopelessly optimistic.

We can't protect ourselves entirely from government corruption, but what happens when we demand more "free" goods and services?

What will tend to happen is that those "free" goods and services will still be provided by government decades, maybe even centuries, from now. It is very difficult for government to dismantle a former service it provided since citizens will become dependent on those services.

As the number of "free" services provided and controlled by government expand and expand, the major constant is that the government will have more and more incentives to tax its citizens however the politicians see fit.

No matter what happens and who is in charge over the upcoming years, as the government grows, it cannot reduce spending below some minimum rate required to provide all these "free" goods and services.

Free Coffee

As a funny example, let's say the government provides "free" coffee. I'm a heavy coffee drinker so it sounds beneficial to me. Let's make all the people who hate coffee pitch in their hard-earned money to pay for my coffee addiction, yay!

Except I don't even want this, even from a completely selfish standpoint who wants other people to pay for my coffee.

For a start, my favorite brand is Nescafe Gold. If the government controls the coffee industry and provides "free" coffee to everyone, they might go with Coffee Break. This is the cheapest yet most disgusting brand of coffee I've ever tried. They can also now charge however much they want for it from whomever they like. We no longer have any choice but to pay for disgusting Coffee Break coffee.

Now my favorite brand could be put out of business. There would no longer be as strong of an incentive for people to buy it given that the government is supplying, controlling, and subsidizing Coffee Break. Even if I bought Nescafe Gold, I'd have to be paying for both Nescafe Gold which I want and Coffee Break which I don't.

Suddenly I could find myself paying the government involuntarily for a coffee brand I find disgusting while my favorite brand is put out of business.

"Free" coffee? No thanks. How about give me free money instead if people want to be so generous?

Free Food

So let's look at a less absurd example and one which I've seen requested repeatedly: free food. Let's say we elect the appropriate officials to make this pass and the government starts providing free food for everyone.

"Free" food sounds wonderful on paper. I've even seen people put it as a fundamental human "right" since it's essential for human survival. From that standpoint it's an entitlement more than a liberty.

What type of "free" food are they going to serve, and at what cost to us tax payers? If the government gains full control over the industry and provides the food directly themselves, we'll have no choice. The wise and benevolent government will determine that for us.

So now let's consider the vegans out there who think consuming meat is inhumane. They try to elect a government official who is vegan and supports providing vegan food over meat products, but they lose the popular vote. The new elected official is a bona fide meat lover.

He decides that the "free" food paid for by our taxes will consist of a diet favoring lots of meat. To cut spending on the food budget, he encourages factory farming which applies the most inhumane practices to cut costs.

Wonderful! Now vegans are involuntarily forced to pay for and support factory farming on a more massive scale than ever before. They just lost all power to opt out as customers by refusing to pay for it.

Of course this example might be a stretch. Perhaps all we want is "free" food stamps we can spend however we wish instead of "free" food.

Yet that still leaves me with a question. Why would you prefer food stamps over hard cash? Would you prefer me to give you $100 worth of food stamps or just $100 in cash?

Poverty

Many people think those of us against "free" things provided by government are callous towards poor people. That isn't necessarily the case.

In my case at least, I'm in favor of just directly handing poor people money. If we're going to redistribute wealth, let's do it directly and cut out the middle man spending things on our behalf.

The consumer paying for what he wants has far more power and freedom than the government spending his money as politicians see fit.

A lot of the arguments in favor of "free" goods and services over free money is actually condescending towards those who can't afford things. The biggest argument against depriving them of a choice of what they buy is that they're too dumb to make good choices about what they buy. That's hardly sympathetic towards those in need.

The reason I favor smaller government is because I favor the freedom to choose what we each individually buy and because huge government spending is the antithesis of a free market.

Free to Choose

The next time people demand "free" things from government, keep this in mind. You are voting against the freedom to choose what you buy. You are voting to be forced to pay for something you may not even want.

Most of all, you are voting to expand the power and influence of government and increase its incentives, at least semi-permanently if not permanently, to keep government spending and therefore taxes higher.

At the very least, if we want to redistribute wealth from one small group of people to the rest of us, at least ask yourself why you don't just want to be given cash directly.

[BellePepper]

Lol when you said basic you were not kidding! Also I'm super sorry for how long this is turning out to be x_x

The thing is with a lot of these issues is that people are already paying for them but in ineffective and expensive ways. Like... let's say the government didn't have any laws against drunk driving. There would be no funding for breathalyzers, extra patrols on holidays, or drinkers moving through the court system. That's tons of savings for you AND you get the choice to drive drunk or not!

But

We know there would be an increase in car accidents, deaths, injuries, and there would probably be an increase in crimes and domestic violence since people can't be arrested for driving drunk and they have to commit an "actual crime" to see legal consequences. How would that affect YOU though right? You don't drive drunk.

BUT

You do have to pay car insurance and if people are getting in accidents all over your insurance goes up. Dead people is pretty much never a good thing. That's fewer paying customers and fewer workers because they were murdered. And also probably more people who drink around the workplace but that ones more ehhhh so we'll just kind of remember it as a maybe XD

You'll also have to pay more taxes to first responder programs because of the extra accidents. Paramedics don't work for free! You'll also have to pay more in health insurance to cover all the people getting hurt AND you'll probably have to pay more taxes to programs that support you local hospital OR you'll have to pay more to go to a bigger area because your local hospital had insufficient funds to cover the care of all these people

There would also need to be more money funneled into rehabilitation or prison programs to deal with the increase in severe drinking plus all of the programs that go with domestic violence etc.. etc... media.giphy.com/media/l673cYwNZE1iM/giphy.gif

So you see how it adds up and you end up paying either way? The difference is in how much value you get from each situation. In what we have now we have less freedom of choice but pay less and are safer. In the alternative we get more choice but there are very steep costs and we do not get to decide whether or not we pay for them or how.

This is the role government takes on. As individuals we can see how we benefit. It's the government's job to see what helps as many people as possible in the best way possible. So even though it may be more expensive in one way it's less expensive in others

[ak666]

I agree with you there. The basic role of government is to protect individual liberties. Drunk driving interferes with the liberties of others, as well as any negligent form of driving whatsoever. That's a little bit different than using governments to, say, take money out of people's pockets to fund a person's degree in gender studies.

[ak666]

There's a difference between negative rights (liberties) vs. positive rights (entitlements). The former prevents people from having their rights taken away. The latter often interferes with the former and is inherently immoral in nature.

[BellePepper]

Well, I would argue a degree in gender studies is useful and has more value than like an architecture degree since a gender studies major is more likely to find a job than an architect. Seriously they have super high unemployment even though they seem like something that's super useful and important.

But that's sort of the point. Like we can't *always* pay for exactly what we as individuals want. That's not how taxes work. Like we don't pay road taxes only for the roads we drive on right? It's the same idea. The govt pays for some things that you want and some things that you want and ideally we come to system that we all benefit from because you can drive on my roads and I can drive on yours.

[ak666]

Absolutely, which is why I think government should be minimized. As a simple example, take social security. That's in the realm of positive rights. It tends to most benefit the wealthiest people with the longest lifespan at the cost of the poorest people with the shortest. Inherently government may require some positive rights for practicality, like roads as you mentioned, but typically the more and more of them we have, the more unjust the system becomes.

[BellePepper]

Yeah but what's moral to me may not be moral to you so it's not a very good measuring stick. And like you can't measure morality. Running a red light doesn't rank as two sins and running a person over doesn't rank as 2,000 sins.

But we can measure the costs of things. Running over red light may cause an accident which will cost 2,000. Running over a person would cost like 200,000 so let's make laws to not run people over because it's freaking expensive.

[ak666]

The most basic morality that I'm hoping all Americans can agree on is that which is expressed in the declaration of independence, that all are created equal and are given inalienable rights, among which include life, liberty, and the pursuit of happiness.

That establishes the ultimate in negative rights. Anyone who infringes on another person's life, liberty, and pursuit of happiness via force (as with the case of drunk driving or simply stabbing someone in the neck) has infringed upon that individual's rights, and it's government's primary job to protect those rights by punishing those who infringe upon them.

Negative rights I have no quarrel with. We need to protect individuals in society, and that's government's primary role as I see it.

Positive rights are where I find things questionable, because they can infringe upon an individual's rights to life, liberty, and the pursuit of happiness.

[BellePepper]

With social security we know Americans are so bad at saving. Like SO bad. So the alternative of not making people pay into it more expensive because then we'd have tons of cute little old people with no retirement and living horrible lives especially if they're poor and have no family to care for them. I'd argue that level of suffering is more expensive to poor people than social security.

And I'm honestly not like SUPER well versed in whether or not it's cheaper to let people invest their own money or pick who invests if for them. Off the top of my head I'm thinking no just because of how many people we've heard about losing their pensions.

[ak666]

With social security it's also becoming fiscally unsustainable the further we go here in Japan too. One of the problems the government failed to project was the constant extensions to life expectancy but also declining birth rates. The latter problem is affecting young people heavily here in Japan because now we might have one young person paying for two+ old people.

The biggest misconception about the program is that the government takes that money out and then somehow sets it aside in a special place to pay back to us when we age.

In actuality they might even allocate the money they collect from social security into the military, for example. It's just another source of government revenue and it's not even benefiting those who are the worst off.

>> With social security we know Americans are so bad at saving. Like SO bad.

This part I'm hoping we can start to correct in future generations through persuasion and education.

[BellePepper]

The problem with that though is that those can all be subjective. Like... I have terrible allergies yeah? Well I can't travel by air because people could eat snacks seasoned with pepper and I'd die and it would be very inconvenient.

Now to me I feel like my rights to liberty and pursuit of happiness are being infringed upon because I REALLY like flying and traveling. But because of someone else's right to liberty and happiness from peppered snacks I can't. So who is REALLY right in that situation?

I'd say I was because it's way cheaper for someone else to just leave the damn jerky at home than it is for me to try and work out a way to travel by car etc... But most people wouldn't agree with me because they love their jerky and this is America!

And like if we go back to social security isn't the government protecting people from starving and going homeless by creating a program that helps them with those things?

[ak666]

>> Now to me I feel like my rights to liberty and pursuit of happiness are being infringed upon because I REALLY like flying and traveling.

I see, yeah, and another tricky one is take a handicapped person. Without government intervention it's difficult to say whether anyone would provide wheelchair ramps, for example, to accommodate them. There might not be enough of a business incentive if the handicapped only make up a small minority of people.

There are some cases like this where I can lean towards being in favor of positive rights. I just think we should be very, very careful about it. There's a warning from Jefferson himself:

izquotes.com/.../...ng-thomas-jefferson-370415.jpg

The only thing guaranteed in the long run when we keep expanding and expanding what the government provides for us is that government will tend to remain big in the future... and politicians tend to be very corrupt people.

[ak666]

>> And like if we go back to social security isn't the government protecting people from starving and going homeless by creating a program that helps them with those things?

Absolutely, but from what I could investigate about the data, programs like SS haven't necessarily benefited those they most intended to protect, and there are even arguments that these programs have hurt people they intended to protect. Whenever the government places its hands on things, adverse effects could happen to the economy.

[BellePepper]

Yeah people don't realize that their bank doesn't just keep all their money in the safe either. They put it to work. I don't agree with Social Security money being used for other things than social security and I honestly think it's stupid because it's not like the military is going to pay it back nor does it have any way to do so which makes it a bad borrower.

I would also like to see that change but it's culturally unlikely and you know people would say "it's bad for businesses!" as a way to prevent it being pushed.

My thought is this. If I can get something cheaper with better results I"m going to go for that over an inferior product. If the government is giving me better benefits then I'm going to pay the government instead of someone else.

[BellePepper]

LOL! I tried so hard to get everything in one reply and then you posted again XD

Like I said it's not a strong point of mine and is honestly *incredibly* stressful to talk about rn so I'm just not sure and am not really sure where to look up the kind of data we'd want to really talk it out :/

[ak666]

>> If the government is giving me better benefits then I'm going to pay the government instead of someone else.

The one dangerous difference about government from a standpoint of a consumer of services is that they aren't guaranteed to offer a better price in the long run (or sometimes even the short run when they're campaigning: what people say to win a campaign and what they achieve after can be entirely different).

... however, what they are guaranteed to do no matter what is be able to force any of us to pay for it whether we agree or not. It's why I'm generally afraid of expanding and expanding governments. There's an alluring marketing appeal to the word, "free", but I actually see a dark underbelly to such promises.

Even if the politician offering all these services is completely noble, there's no guarantee that the next elected officials will be as noble, but all that will remain is that they now run a much bigger government.

[BellePepper]

Well, in those situations there are supposed to be laws that protect the people from the politicians. But as we well know those can sometimes be difficult to have enforced. But like JFK said we don't do things because they're easy. We do them because they're hard.

So I think it's good to be wary of the politician, but I don't think we should fear him and let him stand in the way of doing good.

[ak666]

The one politician, perhaps not. I think there are some good ones, at least well-meaning. The trouble to me is the legacy they leave behind. It is far more difficult to reduce the size of government in retrospect after realizing the expansion caused all kinds of negative effects on the economy, poverty, unemployment, etc. than it is to simply expand and expand.

About the data, if there's one economist I'd like to suggest on the suggest, it's Thomas Sowell. Obviously no economist is detached from bias, but he studied these programs extensively (including working for the US Bureau of Labor).

https://www.youtube.com/watch?v=CLxy1nhF11s

[BellePepper]

I will try to watch it but probably not tonight XD

[ak666]

>>About the data, if there's one economist I'd like to suggest on the suggest [/subject, sorry] it's Thomas Sowell.

[ak666]

>> I will try to watch it but probably not tonight XD

Cheers. He might just convert you a little to the libertarian side... maybe not. :-D I had my mind-blown a bit about what he had to say along with other economists like Milton Friedman.

Now I don't want to place total faith that what they are saying is correct, but they at least make a fairly strong case that all these things which were intended to help people in need like minimum wage, social security, and affirmative action may have done the precise opposite. In particular, Sowell focuses a lot on the adverse effects these programs may have caused on minorities, like black people.

At the very least, they offer some compelling arguments to mull over.

[BellePepper]

I doubt there will be any conversion since I'm a big fan of globalization.

And honestly if someone is going to say having a minimum wage is a bad thing I'm pretty much ready to write them off.

[ak666]

Sowell is also in favor of free trade. Protectionism is insane.

Imagine a country exports high-quality electric cars to the US at $500 a car as an extreme case. What consumer would vote to pay $20,000 a car vs. $500 a car? No sane person would do that. It benefits every American consumer to have affordable cars.

The only person this protects are automobile manufacturers in the US who can no longer compete. They're the only ones who lose in this deal, but protecting them is coming at the cost of every consumer in America.

About minimum wage, it's more complex than it appears on the surface. Sowell believes it has priced black people in particular out of the market. The poverty, crime, and unemployment level among black people have risen drastically with the introduction of programs like minimum wage and affirmative action.

www.azquotes.com/.../...homas-sowell-114-13-80.jpg

[ak666]

When he started working at the Bureau of Labor, he discovered the minimum wage policies weren't considered in the interest of helping the needy at all. The special interest groups most vocal about it were those who wanted to avoid dealing with competition that would be able to get by paying employees for less. It's the same principle as being anti-globalization, not wanting to compete against those willing to work for less, only domestically instead of overseas.

[ak666]

Sowell originally came from poverty in Harlem, but his neighborhood was a safe and decent place at the time. Black people were disadvantaged from a history of oppression, but they were starting to thrive. They could out-bid white workers by willing to work for less and gain access to quality education.

What minimum wage did was kind of seal the discrimination. Discriminatory white employers, now forced to pay a minimum, started favoring white employees to black employees who no longer had any bargaining power to work for less. Then we end up working towards a vicious cycle of unemployment.

To counter this, the government began to favor racial quotes under affirmative action with Nixon. The intent was good to try to counter the negative effects of minimum wage and to try to force anti-black labor unions to be forced to accept black people and meet a quota. Unfortunately what this apparently did, according to him, was make them only favor the most well-qualified black people...

[ak666]

[...] the government began to favor racial quotes [/quotas] under affirmative action [...]

Unfortunately this backfired and apparently still priced those with only average qualifications out of the market. Poverty, unemployment, and crime rates escalated among minorities, especially black people.

All of these policies were enacted originally with good intentions from the American people. It just ended up leading to very bad results.

[ak666]

It's discrimination at the heart of the problem but minimum wage can exacerbate it. Imagine I'm a discriminatory employer who prefers hiring people who speak fluent English over those who can't. However, I'm forced to pay at least $12/hour per employee. I'm not going to hire immigrants who have a hard time speaking English at that point unless I'm forced through a government mandate which requires me to fulfill a quota of non-English speakers. It basically deprives unfavorable minorities of their bargaining power to work for less.

Raising and raising minimum wage has a similar effect to anti-competition effect as globalization. It sounds like it would help needy people but it tends to hurt those who need help the most.

[ak666]

... as anti-globalization, sorry. I know you hate being pinged so often. I tried to avoid spamming too much by utilizing max character count as I would. It's just such a complex subject and it's easy to mistake someone who is against minimum wage as being cold and heartless. In my case, my reasoning for it is quite the opposite. I want to make sure those who are the most disadvantaged who are making $0/hour have greater opportunities to find work.

[BellePepper]

No worries. I know you're using your full 1000 characters so I'm not upset :)

I just do not agree about minimum wage being harmful. We see low wage workers such as waitstaff and agricultural workers *constantly* being taken advantage of and employers pay them less than the typical minimum wage. And do you think it's a coincidence that women and minorities are more likely to be employed in minimum and subminimum wage jobs? Because I don't.

So these people truly have no real bargaining power except to back themselves into a corner where the employer is able to take advantage of them.

[ak666]

It's a difficult problem and minimum wage divides economists almost straight down the center. The main problem Sowell points out indisputably is that under all those policies like affirmative action and minimum wage, unemployment, crime, and poverty among black people rose drastically. At the very least these programs failed to achieve what they intended, at the very worst they might have been the precise cause for this decline.

America has been experiencing the results of these policies on the economy for decades. It's difficult to tell what might have been otherwise.

Inherently the principle of minimum wage is that it keeps competitors from being able to race to the bottom. That race to the bottom could have people working at ridiculous wages that they can't earn a living on whatsoever while simultaneously putting those unwilling to work at those wages out of work.

It's a similar argument against globalization though, like Chinese putting Americans out of work.

[ak666]

>> And do you think it's a coincidence that women and minorities are more likely to be employed in minimum and subminimum wage jobs?

About this part, I'm not sure that is the case. We can find the latest data from BLS (Bureau of Labor Statistics). Unless their data is very faulty, the distribution of those working minimum wage is not so skewed towards minorities.

www.bls.gov/.../home.htm

There are approximately 2.7% of people earning minimum wage or below. Most are very young.

[ak666]

This is kind of an interesting video on the subject from an economist who isn't taking any sides, just trying his best to point out the arguments for and against minimum wage.

https://www.youtube.com/watch?v=4GIdROzO94M

[BellePepper]

The problem with the Chinese isn't that they're making cheaper products. It's that their products are cheaper because the government is subsidizing them in a concentrated attempt to cut out foreign competitors and then jack up the price. And like their entire approach to their constant manipulation of their economy is problematic.

Oh yeah 62% of minimum wage jobs are held by women.

[ak666]

It is, but it's not so dissimilar to a domestic business being subsidized by government, driving out competition. Tariffs are also kind of a war-like activity, disrupting free trade, and it can cause unnecessary hostility among countries. If it initiates a trade war, virtually everyone loses. Competitions can be more "rigged" when dealing overseas, but I still see it as potentially more beneficial in the long term for the consumers to benefit from the unfair competition, and for the producers to come up with a new strategy. It's a difficult one though where there are trade-offs no matter what we do. I tend to resort to an ideology at that standpoint of just favoring free trade.

When we buy Chinese products, they get dollars. They can't do anything with those dollars except to buy back American products and services. Both sides benefit even if one side is rigged.

With tariffs, both sides definitely lose in some respect and on a rather large scale.

[ak666]

About minimum wage, I want to offer one last viewpoint that economists often neglect: the entrepreneur. This is usually neglected since entrepreneurs don't show up in broad economic data. They are people who can potentially start a new business.

Say you are working in a company at minimum wage with some disgruntled female colleagues. You and your colleagues feel discriminated and unwelcomed. The team seems to consist of a bunch of male chauvinistic types, including your employer.

As a result, you and your colleagues decide to leave the company and start a new business, pooling whatever funds you have and getting loans as necessary. They elect you as the leader. Unfortunately you lack the sufficient startup capital to afford paying every employee minimum wage. You could potentially do that after your business grows a bit and starts bringing in revenue, but not now.

This leads to a difficult decision, and it may prevent you from being able to entertain this new idea.

[ak666]

That's something that doesn't show up much in popular economic data -- how many female entrepreneurs were able to successfully start up a business. Most people just look at jobs created and jobs lost, but minimum wage may have eliminated the potential for some exciting businesses to have started in the first place.

[ak666]

This is one of the things I find sad about America. I don't see that many success stories of thriving businesses being founded by minorities. Most of the time those success stories involve your stereotypical white male in a suit.

And the reason for this, in my opinion, is that you need so much startup capital to start a business. It's grueling to start one and is incredibly risky and typically requires facing a harsh winter or two where the business isn't profiting at all and is only bleeding money... unless you're already wealthy.

The game was always rigged towards the wealthy but it especially becomes rigged when the cost of starting and running the business gets higher and higher as a result of all the business regulations, of which minimum wage is but one.

[BellePepper]

I also hate tariffs but I don't agree with the Chinese being able to screw everyone else over because their government wants to dabble. The whole situation is frustrating.

In that situation I'd sue the assholes and use our settlement to finance our new company.

I think there are actually vague numbers running around because there are business licenses. I don't know if it's been compiled though.

LOL I want federalization of school so people can finally have that freedom. No more of this property tax nonsense. I think we want a lot of the same things just in different ways.

And like the reason women and people of color have a harder time starting a business is because banks are less likely to lend to them. I don't see that as a problem with minimum wage. I see that as a problem with racism.

[ak666]

>> I think we want a lot of the same things just in different ways.

Very much so. I don't think what we both desire to see in America is at all different. It's just a matter of the most effective means to do it as I see it.

In my case I value economic freedom a lot. It just seems correlated with prosperity of all citizens. I can't say it causes it, but there seems to be a link between the two. The US has been dropping in that regard to 17th place.

https://www.heritage.org/index/ranking

I keep hoping to see it rise once again. Well, it doesn't absolutely have to do so. If Americans can be prosperous another way, that would work too.

[ak666]

If I can leave you with one last link, consider the most oppressed minority group of them all, the native Americans, and imagine how much better off they might be if the government just left them alone instead of regulating everything they do.

https://www.youtube.com/watch?v=QVYShOZkZGs

[BellePepper]

I think that there's SO much wasted on things people can' do and so much is lost. I don't see having lost economic freedom because of things like minimum wage. It's because of things like stagnant wages not keeping up with inflation and poor regulation of things like the pharmaceutical companies.

[BellePepper]

Yeah it does seem like they get screwed over no matter what. Either the government pays too much attention to them or not enough

[ak666]

Minimum wage is definitely only a very small facet of economic freedom. It contributes negatively to the labor freedom score but only in a subtle way. It's one of those that's really hard to discern in terms of broad impact, and probably why economists are so divided on that issue.

For poor regulations of pharmaceuticals, are you thinking of the risk-adverse nature of the FDA?

[BellePepper]

I'm talking about situations like where Epipens went $50 to $750 in the span of 7 years or that Shreki boy who jacked up the price of medications just because he could.

[ak666]

I see. You know, the FDA might have something to do with that? FDA approval is extremely risk-adverse. They'd far rather disapprove a safe drug than approve a dangerous one.

Unfortunately a side effect of that is that they approve new drugs at a miserably slow rate. According to Friedman, that has created all sorts of monopolies since the few drugs that pass through FDA approval have basically won the lottery and can now monopolize the entire market.

It's a tricky problem if that's the case. In Japan we don't have such drug regulations so pharmaceutical products tends to be very competitively-priced. However, there was a story on the news here now too long ago of a prescribed drug which ended up killing a dozen people which the FDA in the US had disapproved over 20 years ago. :-(

[ak666]

Monopolies are nasty in this way that they can become price setters. I also read about a company called Luxottica dominating the eyeglass industry in the US. The last time I went there, it cost me around $500 for an eye exam and pair of glasses. Here in Japan in comparison, it's typically around $30 with the exam included. Without competition those businesses can get away with highway robbery, but the solution I tend to see from a free market perspective is just ensuring that there can be competition.

[BellePepper]

The FDA didn't have anything to do with the pricing. Both of the issues were medications that have existed for decades. They were cheap and affordable and the market had no reason to support alternatives

Yeah Luxotica is a huge problem in the vision industry.

[ak666]

Are you sure? I don't know about the reliability of this article, but it seems like a combo of government regulations (FDA, patents, etc) that allowed EpiPen to get away with highway robbery.

www.statnews.com/.../

Without competition we end up with price setters on the market who can get away with highway robbery. Typically those types don't last long, especially for a product like this which others can replicate easily and cheaply, without government protection.

[ak666]

Rand Paul apparently focused on this issue specifically for EpiPen:
https://www.youtube.com/watch?v=ri4c1-UUHR4

I'm also discovering more horror stories about some other drugs, like Daraprim, which went from $13.50 to $750 per tablet. It's a crucial drug required for people to live, and it also seemed to have benefited from FDA bottlenecks which allowed it to be the sole drug of its kind on the market for a lengthy period.

www.law360.com/.../a-look-at-the-legality-behind-daraprim-s-price-spike

[ak666]

Typically whenever we find a price-setter in any part of the industry, the question I always ask myself is:

1) Is there practical competition that people are aware of?
2) If #1 is lacking, is there government involvement?

For the pharmaceutical industry, if I get to #2, almost always the first thing I look into is FDA approval. It's a bottleneck process that's extremely risk-adverse.

Say I'm in charge of the FDA. If I disapprove a safe drug, no problem. I don't get penalized for it whatsoever. If I approve a dangerous drug, however, it's probably the end of my job and horrible press haunting me for the rest of my life.

That risk-adversity often bottlenecks drugs and makes it extremely expensive and time-consuming to get a new drug on the market. Only 1 in 1000 drugs get approved, apparently, and the process typically costs several hundred million dollars. If a company is lucky enough to survive that process, it probably will start jacking up prices.

[ak666]

There's arguably even more incentive to jack up prices since, if we're one of the really lucky ones to be approved by the FDA after such a lengthy period of trials and testing, then we know it is only a matter of time before a competitor gets approved in the, say, next 12 years or so. So there might even be incentive to raise and raise prices for as long as we can get away with it, gradually breaking into the market with low prices and raising and raising them until a competitor appears who also gets through the FDA bottleneck.

[BellePepper]

I agree that there are problems with the FDA and how drugs are priced but i don't think there's such a thing as too careful with people's health.

[ak666]

It's a tricky one. I've seen documentaries from medical professionals estimating that the FDA actually costs far more lives than it saves, like in the tens of thousands of net lives lost. It's not a baseless assumption.

They're going by the number of terminally ill people who die yearly in the US who could have been saved and treated if they had access to drugs overseas which have already been shown to be effective and are already widely used but are not yet approved by the FDA.

On the flip side, the psychological effect of a terminally ill person dying due to a lack of accessible medication is not quite as devastating as a reasonably young and healthy person dying as a result of being prescribed unsafe medication.

It might sound completely chaotic without FDA involvement, as we lack here, but it's not quite as much of a chaotic scenario as it sounds. Medical researchers already conduct their own trials. Safety is already a huge concern even without a government approval process...

[ak666]

... Because they have to assure the doctors who are interested in utilizing the medication that their drug is perfectly safe. They have to release the results of their trials. Both the doctor and the pharmaceutical company already have that strong interest in safety, and so it's typically extremely rare for a drug to be prescribed which ends up being ineffective and/or outright harmful.

That said, it has happened before in a way that cost about a dozen lives, and that was a major news story some years ago over here.

[ak666]

Safety-related topics can actually sound kind of ruthless. For example, automobile manufacturers might be faced with questions like, "If we can charge the customer X dollars extra per car, we could potentially save Y lives per year."

Someone trying to lower the Y value to 0 regardless of how high X becomes could end up making it so the only cars available on the market are practically armored tanks that cost a fortune, and then only rich people would be able to comfortably afford them.

Those who aren't rich might have to pay so much for a car that they deprive themselves of money which could have a better chance of saving their lives, like life-saving medical treatment.

It could even have adverse effects on the economy. Companies that transport goods may have to charge far, far more for their services if they have to pay so much more per vehicle. The price of all essential goods may escalate in a way where few can afford them. Living standards may drop, poverty may escalate, ...

[ak666]

... crime may escalate, etc, and all as a result of wanting to maximize safety.

This is a really exaggerated fantasy scenario but making decisions about safety tends to require someone who is kind of cold-hearted to really achieve a practical balance there, since a "practical" balance has to realize that some "acceptable" threshold of lives could be lost per year.

The idea of "acceptable" here would be horrifying to most warm-hearted people.

[ak666]

Someone trying to lower the Y value to 0...

Err, someone trying to reduce the potential number of lives lost to 0, sorry, or trying to maximize Y.

[BellePepper]

I absolutely do not agree with that. Have you ever watched any documentaries about what used to be in food? And like the FDA is what holds food companies responsible for what's in their food. There are millions of people who HAVE to know exactly what is in their food. It is actual life and death.

And yeah we *need* their stringent standards because we see what happens in the vitamin industry where the "vitamin" doesn't even have any actual vitamin in it and is all fillers.

I would also like to see as many medications that are safe available as possible for as low a price as possible but I think we can both agree that's a two prong issue. On one side we have FDA safety regulations and on the other we have the ridiculous laws about not being able to do anything about pharmaceutical pricing.

[BellePepper]

Even if you say "ah the price of these cars is too high for me." Well okay but how high is it vs the price of losing a trained employee vs one who is untrained and the bad press of that entire situation?

The thing about Economics is there's always a cost. There's never a perfect answer. There's just a Best Answer.

[ak666]

That best answer itself is very difficult to obtain with all the ugly trade-offs and the way that the effects of policies often seem to only show up over very long periods of time. :-(

I tend to see government intervention as like fiddling with something over here because it's undesirable, but then something else breaks over there. Then they try to do the same for something else over there, then something else breaks somewhere else.

It's like if we tried to introduce price controls and acceptable profit margins for drug industries while still combined with the extensive costs and time required for FDA approval, it might shift even more medical research and innovation overseas. I can't say that for sure but ugly things almost always seem to happen with more and more government intervention.

There's like a balancing issue there but I think most of the times, if the government gets involved, a lighter touch is safer than a very heavy-handed one.

[ak666]

The FDA used to only approve drugs for safety instead of efficacy, and apparently it took far less time back then. Another issue with the FDA that I see is that there's no incentive to approve a safe drug. They don't get anything out of it. There's only an incentive to disapprove of drugs that could either be safe or unsafe, to always err on the side of disapproval.

The one thing I want to point out is that the FDA is quite a unique phenomena to the US. Underlying a lot of arguments in favor of government regulation is usually distrust for the private sector, but here in Japan, for example, the consumers got together and it became profitable for companies to publish what is contained in their food.

Basically the private sector took over that role of the FDA in ensuring that food is safe. And of course if someone ends up giving people food poisoning as a result of negligence and the use of unsafe ingredients, they could end up losing their entire business.

[ak666]

Another constant I tend to find with government intervention is that good intentions often end up yielding bad results. The people could have been completely noble in terms of what they wanted to do for society and the economy, but sometimes it can have the precise opposite effect.

www.heritage.org/.../...y-50-years-chart-2-825.jpg

https://harrybrowne.org/GLO/Image1.gif

[BellePepper]

That's why everything is assigned a value. Then you know how much each choice is worth and you're able to find those Best Answers. Otherwise it would all be a thought experiment and there'd be no science at all!

I think there are ways to control prices and profiteering without driving out companies. Plus the US is *exceedingly* well equipped for pharmaceutical production.

[ak666]

One of the difficult things to me with the US in particular is just its sheer scale. The way economic policies ripple through the economy and over many years is much harder to tie back to root causes than a much smaller nation, e. g.

Something that *seems* to be a recurring factor for whatever reason is that limiting government spending across the board and maximizing economic freedom seems to help the economy. Economic freedom seems counter-intuitive this way.

https://www.youtube.com/watch?v=aC8nnUy_exI

Yet it seems to be, for whatever reason, a useful way to help the prosperity of all people involved. It's about the only measurement I see as even being remotely reliable that allows us to forecast trends about the economic health of a nation.

https://www.youtube.com/watch?v=6yqA6-ukmfg

[BellePepper]

I agree. It's hard to account for all those variables! Like just think how you'd have to do your own research just to find the numbers you'd need! @_@

[ak666]

Lately I've developed a strange hobby wanting to look at broad numbers with each country in the world.

Freedom indices are interesting and digestible to me since they have a methodical way of assigning an overall "score" for each country, though that score doesn't necessarily reflect the prosperity of the average person let alone the poorest. It's where I have to go by secondary means to try to kind of get a picture of what's happening in each country.

My three favorite sites in this regard for just broad numbers:

https://www.heritage.org/index/ranking
https://www.indexmundi.com/g/r.aspx?t=0&v=30&l=en
www.fraserinstitute.org/economic-freedom/map

[BellePepper]

I can tell you right now I'm not looking at anything from heritage or that horrible fraser man. Bu I agree that these can be interesting things to think on.

[ak666]

Almost all the economic freedom indices have a bit of a capitalist agenda behind them, since at the core of their criteria and metrics are essential the ideas of Adam Smith. Their data and measurement criteria does seem quite sound, however, since various institutions providing human freedom indices largely come up with the same results with only the most subtle deviations here and there (and I'm thinking its just due to mild deviations in data rather than criteria).

A more difficult question is just whether economic freedom is a key to economic prosperity. It really seems to be the case, rather overwhelmingly so, but it's hard to explain exactly why. I've come to accept it like any other health recommendation: "Eat your veggies and drink plenty of water." Why? I don't know exactly. The explanations get really complex.

[BellePepper]

The more people can do what they want they more they're going to want to do it and the better they'll be at it. That would be my guess at least.

[ak666]

since at the core of their criteria and metrics are essential the [/the essential] ideas of Adam Smith.

Kind of working back to the main topic, there is one case where I can see a genuine free lunch being possible, and that's through automation.

For example, if we could mechanize agriculture and completely replace farmers but also have machines that are self-sustaining, repairing themselves and so forth without any human intervention and simply growing and outputting food, that would technically be free.

There would be no cost to run and maintain it since the price of labor drops to zero (including maintenance). Of course there might still be a cost to transporting the food, but perhaps that could be mechanized as well.

I find the idea really interesting. I talked to someone on here though who found it really horrifying. :-D

[BellePepper]

Well you'd still have the cost of designing them and supplying not only their fuel but their supplies. Plus you'd have to have programmers and farmers teaching them and some type of inspector monitoring them. Oh and then the scientists in charge of the plant husbandry or whatever XD

Nothing is ever truly free.

[ak666]

Fuel is tricky -- solar power might do it. It's not an infinite resource but one that comes to us in abundance whether we want it or not. Nothing is ever truly free in terms of the planet and resources but I could see a case where these bots can become self-sufficient, capable of repairing, replicating, and maintaining themselves -- making for a one-time cost rather than something that requires ongoing expenses.

Of course reaching that point where the automation is totally self-sufficient is probably far, far away if we ever can get there. It'd probably need supervision and human maintenance for a good while. I see that as somewhat of the end goal though -- from supervised machine learning to unsupervised, from human repair to self-repair, and so on.

If we reached that point where these bots are completely independent of human supervision, I could see some period where food is truly free in a small community at least which doesn't introduce extraneous costs.

[ak666]

That said, some scientists think such achievements will ultimately spell the end of the human species. :-D

I like Stephen Hawking's joke:
"Scientists built an intelligent computer. The first question they asked it was, 'Is there a God?' The computer replied, 'There is now.' And a bolt of lightening struck the plug, so it couldn't be turned off."

[BellePepper]

LMFAO! I don't think such developments should be feared. They should be encouraged and welcomed as natural progress that improves people's lives.

Like I have a bread machine. The hardest thing to do with it is make sure my water is the right temperature and even my kettle can do that! If you'd have told my great grandpa the baker about it he'd probably be less than impressed XD But it makes it so that I can spend my energy and time on other things. It doesn't make it bad. It makes it progress XD

[ak666]

I think the general fear of this style of artificial intelligence comes from the idea that the complexity it accumulates would far exceed human understanding, and therefore end up doing all sorts of unanticipated things that could threaten the entire human species.

These doomsday scenarios usually come from scientists and engineers who aren't directly working in the realm of artificial intelligence.

I think they're correct in a way that the training process would gather data that would be astronomically complex. Yet that's divorced from the underlying programming.

The underlying programming would have to be relatively quite simple and humanly manageable as I see it, and that part I think is capable of being constrained from being able to perform certain behaviors.

The constraints would actually be quite easy to maintain as I see it as with the case of maintaining invariants in general no matter how complex systems get.

It might be hard to say exactly what [...]

[ak666]

[...] such a system can and will do given the subset of behaviors it is allowed to perform, but I think it would be fairly easy to say what it definitely cannot and will never do.

[ak666]

That's excluding malicious human tampering. For example, if we had a car capable of being trained through voice actions, it might be fairly easy to impose a fundamental system constraint that prevents it from running over pedestrians. Yet if someone could tamper with the programming, they might be able to override such a constraint and then have an autonomous weapon capable of being used to kill people left and right. I think that type of scenario is scarier and potentially more of a real threat than us just accidentally creating killing machines.

[BellePepper]

I agree. People are afraid of change. People thought steam power was Satan's work and look at us now XD And honestly. If we let every scary thing that might happen hold us back how would we ever move forward?

[RichardBrooks]

I don't have a degree in economics either. But I am a business owner, and understand a good deal about how the economy, government, and business operate. I don't have room in this box to address all the false analogies and non-sequitors.

"Many people seem to want free healthcare, free education, free water, and even free food."

Nope. I want my tax dollars to pay for health care, education, and taking care of the poor. I know these things are not free, nor do I expect them to be. I just want my taxes paying for things that benefit society… and me. Taxes are not theft. I gladly pay my taxes each quarter and would gladly pay more.

Government funded healthcare isn't some philosophical pipe dream. It works. Almost every industrialized nation has some form of government funded health care. Because it is single payer, the government has massive bargaining power with the insurance companies and healthcare providers, making healthcare cheaper and more efficient.

Government provided education gives me an educated labor pool. The more my tax dollars are used to educate people, the less I have to spend screening applicants. The alternative, I guess, would be my companies hiring tutors for each new hire so they would be educated enough to do the jobs they've been hired to do. Thank you, but no. Just use some of my tax dollars to fund education. This saves me time and money.

I've never actually heard someone claim the government should provide free food. We do, however, give people money to buy food already. It's not in the form of cash, so it can only be used to buy actual food products or produce bearing plants. Is this what you're against? If so, are you aware that the vast majority of recipients are elderly, minor children, or disabled people? Yeah, so we as a society have decided it's a good thing to not let kids or old people or disabled people starve because they can't work. I agree. In fact, I think they should get more.

I look at it this way: Poor people can't buy my products. The larger the social safety net, the less poor people there are, which means more people buying my products. I come out better in the long run paying more taxes but selling more products. Provided my taxes are actually being used on programs that benefit society, such as healthcare, education, and a large social safety net.

[ak666]

I think you could use a dose of Friedman.

For a start, we have universal healthcare here in Japan, subsidized by government, and it is reasonably affordable. However, it doesn't fully insure the patient (they must still pay around 10-30% of the costs). Combined with the fact that Japan hardly spends a dime on the military (~5% on national security) and things of this sort, taxes are relatively low considering. I pay around 33% in taxes.

However, there are multiple reasons why it's so affordable. The quality of patient care, especially in areas of comfort, are considerably poorer than in the US. Waiting times are longer, anesthetics are used sparingly and only if the patient cannot endure the pain, there's less privacy per patient, hospitals are more run down, and so forth.

On top of that there's no FDA regulating drugs and significantly delaying and funneling their availability on the market, so there's a healthy competitive drive among companies to provide the cheapest and [...]

[ak666]

[...] and most effective drugs without one company monopolizing the market simply because it was the one lucky brand that was given FDA approval. That has its pros and cons but it certainly keeps prices down and improves the incentives for medical research. The main cons is that some dangerous drugs have leaked into the hands of customers and have caused deaths, including some drugs the FDA already banned in the US.

All sorts of factors like this lead to affordable healthcare, but the government doesn't necessarily have a strong hand in driving those prices down. It's more the lack of regulations and quality control. The US could potentially benefit from those lack of regulations and lower quality services for those who can't afford the best healthcare.

>> I've never actually heard someone claim the government should provide free food.

You went into welfare so let me stop you there. I'm not talking about welfare at all. There are actually a rising group of socialists who are [...]

[ak666]

[...] more and more things to be "free". I've actually run into people on GaG who believed government should provide free food along with free feminine products and so forth. This was mainly intended for those extreme types.

>> Government provided education gives me an educated labor pool. The more my tax dollars are used to educate people, the less I have to spend screening applicants.

How much does your business benefit from people with liberal arts degrees and PhDs in gender studies, e. g? If education is free for everyone regardless of eligibility, what type of degrees do you think they'll pursue and what do you think they'll spend their time doing at universities?

[ak666]

One last factor I forgot that is crucial for lower healthcare costs here: medical malpractice. There aren't lawsuits here for millions and millions of dollars if there's an incident of medical malpractice. That probably also plays a very crucial role in keeping prices down.

[ak666]

About free higher education, that's one of the most troubling to me actually. Free healthcare has a stronger argument as an essential need and something which doesn't necessarily benefit the patient incentive-wise to pay for it and make sure he/she gets his/her money's worth as would be the case with a higher education.

With "free" higher education, aside from depriving people of that incentive to spend their time at university in a meaningful way to pursue meaningful degrees, it can potentially cost just as much as free healthcare.

The average tuition for a student in the US right now is around $20,000 per year, with around 20 mil students enrolled per year. If that becomes "free" and paid through taxes, then it should be reasonable to expect the number of students to rise to 50 mil per year (after all, people in all age brackets could potentially seek more education now that it's free).

That would cost a trillion dollars a year. That's *double* the amount the government [...]

[ak666]

[...] spent in total from 2015! With twice the government spending, there's no practical expectation to see taxes doubled overall. Of course the government might deallocate money from one service and transfer it to another and they could reduce military spending and so forth to try to avoid causing a riot among citizens, but no matter what happens, as long as government is providing that service, you can expect people to be paying twice as much overall for taxes as they were from 2015...

... unless the government can somehow make higher education more *affordable*. If they can halve the cost and make it $10,000 a year per student, then it'd be half a trillion dollars and that's starting to get a little more reasonable.

However, if the government has the power to make higher education more affordable, wouldn't it be safer to seek to do that first instead of making it "free" and tax the hell out of everyone?

[ak666]

[...] there's no practical expectation [except] to see taxes doubled overall.

[ak666]

Now you went into taking care of the poor and people who can't afford food, education, healthcare, etc. That relates to poverty and welfare and is a totally different subject. In that case you aren't redistributing wealth from like the top mega-rich 1% to everyone else, but rather from just about everyone towards the bottom 15% (about 15% live below the poverty line).

That's a very different and complex subject but it's radically different from free lunches for 99% of the people at the cost of the top 1%. That's not my main focus.

[ak666]

Now phew, sorry for lengthy replies! There's a lot to cover there. But about single-buyer systems, they do over more bargaining power as you mentioned. However, they can also create monopolies and eliminate competitive incentive to improve productivity, efficiency, and quality.

There's an interesting article here about reforms of Canada's system which is in dire need:
policyoptions.irpp.org/.../

... and their solution is simple: to bring back the competitive incentive of the free market.

>> As we have said, there is nothing wrong with people using their bargaining power to seek the best possible deal they can get. [...] At the heart of the problem is a system that does not permit a proper balance between providers’ desire for wage/salary increases and government’s objective, in its role as funder of the system, of increased productivity.

>> Without competition the monopoly provider of hospital services drives up costs and constrains productivity gains [...]

[ak666]

>> We cannot stress strongly enough that in our view, and in the view of the Senate committee, failure to improve the productivity of health care delivery will result in the system, as it is presently structured, becoming financially unsustainable in the reasonably near future. In its report, the Senate committee concluded that ”there are real, continuing upward pressures on Canada’s health care costs,” and that, therefore, ”Canada’s publicly funded health care system, as it is currently operated, is not fiscally sustainable given current funding levels.” Among the factors that compelled the committee to reach this conclusion were the impact of the aging population, rising drug costs and the need to invest in expensive new technologies.

There has to be a strong competitive incentive even under the single-buyer system or else it can grow into an unsustainable disaster without reforms as in Canada's case. Free healthcare is something I'm not quite as against [...]

[ak666]

[...] as some other things, but it is dangerous territory and what will remain constant, regardless of improvements in productivity and efficiency or lack thereof, is that everyone is going to pay for it whether they like it or not, and unless the productivity and efficiency is greatly improved, it's going to cost a very large chunk out of everyone's pocket each year regardless of whether you're in excellent health or terminally ill.

[ak666]

There are two immediate things that I think would help with the US in cutting down healthcare costs.

1) Dismantle the FDA or at least just make it FA. Eliminate the drug safety regulations as they do in most nations that provide national healthcare. This will improve competitive incentive and accelerate medical research.

2) Reduce the price of a human life in the context of negligence, especially in the context of medical malpractice. Here in Japan, if a doctor makes a big mistake like leaving scissors inside the patient by mistake, people typically don't sue the doctor. They understand he made an honest mistake. As a result compensation is minimal or none. In the most rare cases, if they are compensated, it is for a modest fee, in the hundreds of thousands of dollars or so, not millions, and typically such cases would be thrown out of court unless the doctor was ridiculously negligent (ex: drunk on the job).

These two things would already help as I see it.

[John_Doesnt]

When you said "These basic principles should be obvious without a doctorate in economics." this is a fallacy argument. Assuming that your logic is superior and does not need scientific evidence to back it up is how people believe that the Earth is flat and the Earth is 6,000 years old.
This is not based on science or logic, but a pure rant on paying taxes.

All I heard in this rant was "Taxes suck, taxes suck, taxes suck". When the real answer is YES you do need a doctorate in economics to understand how the concept of a free lunch benefits everybody.

[ak666]

How about a Nobel prize in economics?

www.capitalism.com/.../MiltonFriedmanQuote.png

www.azquotes.com/.../...lton-friedman-10-31-00.jpg

[John_Doesnt]

Those quotes were taken out of context and some of which he never actually said.
Also, memes aren't proof of anything.

[ak666]

Here's some starting material for a complete novice like yourself who thought Thomas Sowell didn't even have an education in economics. Educate yourself if you have no clue about this subject.

https://www.youtube.com/watch?v=D3N2sNnGwa4&t=81s

And here's a person called Thomas Jefferson who you probably aren't very familiar with. He actually was one of the founders of your country.

s-media-cache-ak0.pinimg.com/.../...90725dde2e.jpg

[ak666]

Derp derp derp. You don't even understand what these quotes mean. I don't think I dumbed the article down enough for you.

[ak666]

Look, sorry if I'm being a bit rude. The antithesis of free trade is large government intervention in the economy. At one extreme of the spectrum is free trade, on the opposite is total state control with a centrally-designed economy and the elimination of private property (ex: communism). In the middle is a limited government with private property and taxes.

On the full-blown communist side, you have the end of private property (nothing you own is yours) but everything is "free", so to speak. The idea typically sounds like a utopia but at the heart of it is a very large government that controls the entire economy and can basically confiscate anything you have and make you do whatever they want.

The problem with very large governments is that they become corrupt. That's what Jefferson is warning against. Big government is the antithesis of the type of country he had in mind. High taxes are a symptom, not the root problem, of a country where everything is becoming "free".

[ak666]

We can talk about how national healthcare can potentially benefit the sick, for example. One of the reasons is because sick people often either get priced out of health insurance or drive the premiums up for everyone paying the insurance. Insurance companies discriminate against people based on their health and lifestyle, e. g.

What government intervention and forcing everyone to pay for healthcare does is prevent that discrimination from the ill, the obese, the smokers, etc. It puts everyone on even footing and there's a charitable argument to be made there. It doesn't necessarily make it cheaper for the average person but it does make it much cheaper for the ill person.

It's just leveling out the playing field so that like a morbidly obese person who drinks and smokes is paying something on par with someone perfectly healthy. The average person pays more but the sick person pays less. We end up covering all of each other's backs.

[ak666]

>> When the real answer is YES you do need a doctorate in economics to understand how the concept of a free lunch benefits everybody.

I will give you that the adverse effects that policies have on the economy are far, far more complex than I gave it. At the heart of it is a constant though no matter what happens. All forms of government intervention of the economy never benefit *everybody*. They benefit special interest groups at the cost of the masses (ex: the ill at the cost of all the healthy, the rich at the cost of the poor, the middle class at the cost of the poor and the rich, etc).

Social security, for example, most benefits the wealthy (longest-lived individuals who can enjoy many years in retirement) at the expense of the poor and ill (shortest-lived). Nothing benefits everyone.

[ak666]

And here you go since I know you dislike Trump, and I also have mixed feelings against him. Here you can see a precise example of how government interventions in economics benefit special interest groups at the cost of everyone else.

https://www.youtube.com/watch?v=7DhagKyvDck

[ak666]

The reason I'm so invested in this subject even though I'm from Japan is because America is supposed to be the "land of the free". We can go round and round about what economic policies do what to the economy in futility (even economists rarely agree on complex issues and rarely forecast things correctly), but one of the definite things that happens is that you lose freedom in the process. You lose the ability to choose.

And with that the whole idea of America, as it was founded, is slowly dwindling away. I can't definitely say it's going to be for the worse and worse, but I can definitely say that America is becoming increasingly "unamerican", and it seems like a great shame to me, since it's moving in a direction where it's just becoming like the rest of the world as more and more years pass.

[ThisDudeHere]

in my opinion, very simply, if you pay taxes then some things should be provided for "free" in the sense that you don't pay for them on the spot. But yeah, in all technicality, they are not free either. Just prepaid by you and everyone else, but not used by literally everyone at all times.

[redeyemindtricks]

Food stamps are restricted because way, way too many people in that demographic, if given cash, would just spend it on booze or drugs.

[ak666]

I've encountered this already along with the new policy to enforce drug testing on welfare recipients. I'm a bit of an ideologue here but I just see that as their prerogative. If someone so deprived of money is going to just waste it on booze and drugs, then I don't think trying to "force" them to buy food can really help that much. If they're lost causes in this sense, they need education, rehabilitation. They might even support their drug addictions through crime. Welfare is a complex subject, but if nothing else, I think the system is convoluted either way.

[ak666]

To give anyone the freedom to make a good choice for themselves almost always necessitates that we also give them the freedom to make a poor choice for themselves. I value that freedom more than trying to force people one way or another.

[ak666]

This might sound like economic suicide but I'm in favor of freedom across the board. For example, with public education, heavy centralized control often deprives school teachers of the freedom to teach their courses as they see fit, tailored to their personal approach to teaching and to the dynamics of their students and classroom. From what I can understand, disadvantaged students are also deprived of the freedom of choosing which teachers they want and what schools they go towards.

That lack of freedom across the board, as I see it, is a contributing factor towards poverty in the first place. Then I see the poverty as having side effects like substance abuse, crime, etc.

All of this is mitigated, in my opinion, as we increase the level of free choices people have across the board.

[Hispanic-Cool-Guy]

I agree. Nice job. And well expressed and written. But why didn't you mention health care and education? Don't you think that will greatly benefit a society with the essential help it can provide it's citizens?

[ak666]

It's a tricky one. National healthcare is one I'm a bit more divided about. I like to say something which sounds weird: "Affordable is cheaper than free." Healthcare in America is way too expensive as I see it. If it becomes mandatory for citizens to just front the costs, it doesn't necessarily do anything with regard to affordability. It just forces the bill on potentially all citizens. I see healthcare in the US in a state of crisis this way but I think it's too ambitious and too heavy-handed to just try to go straight towards the route of national healthcare right away.

Education I'm actually against and it might sound callous but I'm in the libertarian camp and actually believe it will lead to a more prosperous society. That's not to exclude those lacking access to affordable education and deprive them of an education. That's a totally different issue than "free" education for all.

Interesting debate here:
https://www.youtube.com/watch?v=w3-_r_t7AZU&

[ak666]

For example, if education were "free" for all, I'd utilize it. After all, no matter what sort of tax system is in place to pay for it, it'd likely come out of my pocket to some extent somehow, some way, whether it's through inflation or an income tax or anything else.

And I'd likely utilize that service now that it's provided. I'd love to get a third degree in economics as just a new hobby of mine that I'd like to be more educated about.

But that doesn't benefit society at all to utilize everyone's tax dollars towards me getting a degree in economics. I was also able to afford the degree beforehand anyway without involving other people's tax dollars. I could have just paid for it myself, but I wouldn't now if it were "free".

I think there will be a lot of cases like that where people just utilize the service now that they don't have to directly pay for it. It's like would you be happy paying tax dollars towards subsidizing a PhD in gender studies? I wouldn't.

[...]

[ak666]

[...] Again this is very different from those who are serious and interested and can't afford education to allow them a way to be able to afford it. That I'm in favor of supporting. But it's a very different type of proposal than "free" education for all.

[Hispanic-Cool-Guy]

I agree. I think education and health care is outrageously to expensive. I support the idea of affordable than rather "Free"

[ak666]

There are a lot of liberal policies which often sound like they're helping the ordinary person. A lot of the people who champion them are also warm-hearted people, but sometimes there's a sinister plan behind it.

https://www.youtube.com/watch?v=P9T5g76QIE8
https://www.youtube.com/watch?v=r4SIEl1j8e4

s-media-cache-ak0.pinimg.com/.../...ac83ddb60d.jpg

[ak666]

Again I'm in the libertarian camp or the classic liberal, and that whole ideology is basically about letting people go about their own business without government interference, provided they aren't infringing on other people's rights to do the same.

The idea is that all of us get to do what we want with our own money, our own lives, without government telling us what to do, without constantly forcing us to do things against our will.

It's like if it's just me and you in person, we cut out the middle man. If you need help, I help you, if I need help, hopefully you help me. If we want to trade things, we can do that, and all without the government forcing anything or taking a big chunk. The only time the government should intervene is if I try to coerce you to do something against your will, or if you try to do that to me.

That's the essence of the philosophy, and it actually considers providing "free" stuff as immoral, since it's not really free. No one can just get [...]

[ak666]

[...] a teacher to just work voluntarily for free. No one can magically produce textbooks out of thin air for free. All of these goods and services have costs, so they can never be truly "free".

So what's often marketed as "free" is really just a way to allow the state to force people to pay up whether they like it or not. To be in favor of maximizing human and economic freedom is in favor of significantly limiting the power of the government to force people to do one thing or another.

I actually think when freedom is maximized, we actually end up with a society where everything is more affordable, where people are going to be more prosperous, with less crime and poverty, and so on.

[ak666]

... and that's not a completely arbitrary thought. As far as I can gather, data from multiple sources seems to support this.

https://www.youtube.com/watch?v=aC8nnUy_exI

[EpicDweeb]

Excellent read! It addresses many misconceptions regarding the market, government, and businesses, in a reasonable way that can be easily understood.