The road owner might require drivers to have a driving license and insurance, as well as certified vehicles. People living near the highway would have been compensated for the pollution and noise. If compensation or anti-pollution measures cost too much the highway will be built elsewhere, or not at all. Similar for flying, or polluting industries.
Insurance companies will put a premium on all risky activities, making them either economically viable or not possible. Some critics use the example of the trolley problem to invalidate NAP. In case of the runaway trolley, headed for five victims tied to the track, NAP does not allow a trolley passenger to flip the switch that diverts the trolley to a different track if there is a person tied to that track. That person would have been unharmed if nothing was done, therefore by flipping the switch NAP is violated. Another example often cited by critics is human shields.
Some supporters argue that no one initiates force if their only option for self-defense is to use force against a greater number of people as long as they were not responsible for being in the position they are in. Murray Rothbard 's and Walter Block 's formulations of NAP avoid these objections by either specifying that the NAP applies only to a civilized context and not 'lifeboat situations' or that it applies only to legal rights as opposed to general morality.
Thus a starving man may, in consonance with general morality, break into a hunting cabin and steal food, but nevertheless he is aggressing, i. They point out that local law , though based on NAP, may vary from proportional compensation to capital punishment to no compensation at all. Supporters generally argue that any harm done to innocent persons or any other collateral damage in these cases is done by whoever or whatever caused this situation to occur. In this view, if the threatened party harms the innocent persons, NAP is not violated.
Furthermore, some supporters argue that actions that minimize harm are consistent with NAP. Other critics state that NAP is unethical because it legitimizes several forms of aggression, such as sexual harassment , defamation , boycotting , and discrimination , that do not involve intrusion on property rights. If a victim thus provoked would turn to physical violence, according to NAP, he would be labeled an aggressor.
Supporters of NAP, however, state that defamation constitutes freedom of speech and the boycotting or discrimination that may follow constitutes other people's freedom to believe what they like and deal with whoever they like. Supporters also state that individuals most of the time voluntarily engage in situations that may cause mental battering. Some supporters point out that mental battering, when it cannot be avoided, comes down to unauthorized physical overload of the senses i. Many supporters consider verbal threats of imminent physical violence sufficient justification for a defensive response in a physical manner.
Such threats would then constitute a limit to the freedom of speech. Property owners can also pose a limitation on the freedom of speech i. Mencken , a writer who influenced many libertarians, puts an ethical limit on the freedom of speech:. Critics argue it is not possible to uphold NAP when protecting the environment as most pollution can never be traced back to the party that caused it.
They therefore claim that only general broad government regulations will be able to protect the environment. Supporters cite the problem of the tragedy of the commons and argue that free-market environmentalism will be much more effective in conserving nature. Consequentialist libertarian David Friedman , who believes that the NAP should be understood as a relative rather than absolute principle, defends his view by using a Sorites argument. Friedman begins by stating what he considers obvious: A neighbor aiming his flashlight at someone's property is not aggression, or if it is, it is only aggression in a trivial technical sense.
However, aiming at the same property with a gigawatt laser is certainly aggression by any reasonable definition. Yet both flashlight and laser shines photons onto the property, so there must be some cutoff point of how many photons one is permitted to shine upon a property before it is considered aggression.
But the cutoff point cannot be found by deduction alone, because of the Sorites paradox , so the non-aggression principle is necessarily ambiguous. Friedman points out the difficulty of undertaking any activity that poses a certain amount of risk to third parties e. However, supporters of NAP claim no objective cutoff point is required, only mutual consent. When many parties are involved e. See 4. Template:Div col. Template:Div col end. Sign In Don't have an account? Start a Wiki. Part of a series on Libertarianism Origins. Age of Enlightenment Aristotelianism Classical liberalism. Anti-statism Anti-war Argumentation ethics Counter-economics Crypto-anarchism Dispute resolution organization Economic freedom Egalitarianism Free market Free-market environmentalism Free society Free trade Free will Freedom of association Freedom of contract Homestead principle Individual Individualism Laissez-faire Liberty Limited government Localism Natural and legal rights Night-watchman state Non-aggression principle Non-interventionism Non-politics Non-voting Participatory economics Polycentric law Private defense agency Property Self-governance Self-ownership Spontaneous order Stateless society Tax resistance Title-transfer theory of contract Voluntary association Voluntary society Workers' self-management.
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Contents [ show ]. Of course, almost everything we do imposes some risk of harm on innocent persons. We run this risk when we drive on the highway what if we suffer a heart attack, or become distracted , or when we fly airplanes over populated areas. Most of us think that some of these risks are justifiable, while others are not, and that the difference between them has something to do with the size and likelihood of the risked harm, the importance of the risky activity, and the availability and cost of less risky activities. That principle seems compatible with only two possible rules: either all risks are permissible because they are not really aggression until they actually result in a harm , or none are because they are.
And neither of these seems sensible. I believe there is a limit beyond which free speech cannot go, but it's a limit that's very seldom mentioned. It's the point where free speech begins to collide with the right to privacy. I do not think there are any other conditions to free speech. I've got a right to say and believe anything I please, but I have not got a right to press it on anybody else. Kirkley for the Library of Congress.
Retrieved Rothbard December 23, Indianapolis, IN: Liberty Classics, , Stephan Kinsella. IV, No. Reddit forum discussion, April ". Machan ed. Ashgate Publishing, ". Categories :. Cancel Save. Part of a series on. Origins Age of Enlightenment Aristotelianism Classical liberalism.
Concepts Anti-statism Anti-war Argumentation ethics Counter-economics Crypto-anarchism Dispute resolution organization Economic freedom Egalitarianism Free market Free-market environmentalism Free society Free trade Free will Freedom of association Freedom of contract Homestead principle Individual Individualism Laissez-faire Liberty Limited government Localism Natural and legal rights Night-watchman state Non-aggression principle Non-interventionism Non-politics Non-voting Participatory economics Polycentric law Private defense agency Property Self-governance Self-ownership Spontaneous order Stateless society Tax resistance Title-transfer theory of contract Voluntary association Voluntary society Workers' self-management.
Schools Agorism Anarchism Anarchist communism Autarchism Christian libertarianism Consequentialist libertarianism Free-market anarchism Geolibertarianism Green libertarianism Individualist anarchism Left-libertarianism Libertarian Marxism Libertarian socialism Minarchism Mutualism Natural-rights libertarianism Paleolibertarianism Panarchism Right-libertarianism Social anarchism Voluntaryism.
Liberalism portal Libertarianism portal Outline of libertarianism. Locke gives the following version of the NAP: "Being all equal and independent, no one ought to harm another in his life, health, liberty, or possessions. Drivers process the information about those risks rationally without any systematic cognitive biases. If all of these assumptions are true, drivers would have adequate incentive to drive with efficient care in terms of driving speed, safe braking and passing practices, smart-phone usage or nonusage , and the like.
This is so because, by taking efficient care in driving, drivers would avoid liability for the accidents that nevertheless occur. The assumptions listed above almost certainly do not hold in the real world. While drivers may be generally aware of the broad outlines of the driver liability regime in their state whether it is fault-based or no-fault , they likely do not understand what the precise implications of that fact are on their chances of being found liable in court for unsafe driving.
In fact, there is a good chance that most drivers underestimate those risks. How is this pessimistic picture of driver liability law as a system of incentivizing good driving changed by the presence of auto insurance? The answer is complicated. On one hand, automobile insurance has the potential to correct some of these deterrencerelated problems.
Auto insurers are, unlike most drivers, extremely well-informed about the intricacies of accident law. They employ teams of lawyers whose job is to understand how driver liability laws in each state affect the liability risks of their customers. In addition, auto insurers have unparalleled access to enormous amounts of detailed information regarding the crashrisk characteristics of millions of drivers and automobiles.
All of this information is to varying degrees already being taken into account by many auto insurance companies in the pricing of their insurance policies. For example, policy discounts are offered to drivers with good safety records as well as for vehicles with particular safety features. In addition, insurers are now offering discounts if drivers will improve their driving ability—for example, if they will take defensive driving classes. For example, some insurers give discounts for a range of drivercare-level factors such as wearing seatbelts, driving at moderate speeds, limiting late night trips, and avoiding aggressive braking.
Driving-behavior-sensitive auto insurance premiums— which take into account both good and bad driving choices i. But here is the problem: under current law and existing market conditions, auto insurers do not have strong incentives to make full use of their comparative advantage at gathering risk-relevant information and pricing their insurance on the basis of that information. The reason is that the amount of coverage currently being provided by auto insurers represents only a fraction in many cases a small fraction of the total risks of auto crashes.
It is also true of auto liability coverage because the mandatory minimum amounts. To the extent such coverage is provided through government programs funded by tax dollars, there is obviously no premium being charged at all. Thus, even to the extent that auto insurers do attempt to charge individualized, behavior- and risk-adjusted auto insurance rates which, as I noted above, they are increasingly trying to do , this incentive is undermined by the fact that auto insurers cover only a fraction of the risks of auto accidents.
This may seem incongruous with the argument in the previous paragraph, but it is not. Although auto insurers, in a sense, specialize increasingly in reducing driver ex-ante moral hazard, it is non-auto health insurance companies who specialize in reducing ex-post medical moral hazard—that is, excessive or wasteful use of the health care system.
As an alternative to our current negligence-based auto tort regime, consider the possibility of a comprehensive automaker enterprise liability regime. Under such a regime, anyone who suffers a physical injury or property damage in an automobile accident would be entitled to recover compensation for the losses sustained as result of the accident from the manufacturer of the vehicle.
Accident victims would not be required to show negligence on the part of the manufacturer. Nor would they have to prove that the automobiles, or any of the warnings or instructions accompanying the automobiles, are in any way defective or unreasonably dangerous. Crash victims would need to prove only that the harms for which. Liability under an enterprise liability regime, however, would not necessarily be limited to auto manufacturers. Liability could also be extended to a range of other enterprises that fall within the design, production, sale, and distribution chain of any given vehicle.
The allocation of responsibility among those enterprises, however, would presumably be determined by contracts among the various counter-parties. Those contracts should be enforced so long as the cost of auto accidents is not allocated to parties who are insolvent or judgment-proof. The types and amount of compensation recoverable under an automaker enterprise liability regime would probably be limited to economic losses—medical expenses, lost income, and property damage. The dearth of pain-and-suffering insurance observed in the marketplace could suggest that limiting compensation to economic losses would be consistent with consumer preferences.
And, in any event, not providing compensation for noneconomic harms is a common and reasonable political compromise for alternative compensation regimes. The compensation regime I am imagining is a comprehensive automaker enterprise liability regime. In other words, it would apply to all automobiles sold after the effective date of the enacting legislation, whether driven by humans, computer algorithms, or any combination of the two.
One result of the adoption of a comprehensive automaker enterprise liability regime would be an increase in the price of most newly purchased automobiles relative to vehicles purchased before the effective date of the enacting legislation. Under a comprehensive automaker enterprise liability regime, because automakers would be responsible for all of the economic costs of auto accidents associated with their vehicles, they would be forced to internalize those costs.
In addition, there would be no incentive to stick with existing industry customs or consumer expectations if such customs or expectations were lagging behind proven safety innovations. And there would be no incentive to over-invest in safety features that are likely to impress a court or jury in a negligence-based lawsuit such as a design defect lawsuit but that, in actuality, provide less additional accident-risk reduction than they cost to produce. That cost internalization, in turn, could result in a scale of automotive manufacturing and sales that would be closer to the social optimum than is currently the case because drivers would—in deciding whether to purchase a vehicle—be more likely to consider something closer to the full social costs of that decision.
In other words, auto enterprise liability could push us in the direction of optimal manufacturer activity levels—the optimal number of vehicles being sold. If that were to happen, it would be a clear improvement—in terms of overall efficiency—over the existing negligence-based automaker liability regime.
What would the implications of auto enterprise liability be for fully driverless vehicles? Thus, the adoption of a comprehensive automaker liability regime would, under present assumptions, strongly incentivize and reward auto manufacturers to proceed, as quickly as is feasible, with the development and distribution of Level 5s. If an automaker could actually reduce the frequency or severity of accidents in its vehicles by altering the wording, design, or placement of warnings or instructions, it would have an incentive to do so.
Automakers would do whatever works best to reduce accident costs. Thus, in the transition to Level 5s, automakers would be incentivized to warn and instruct optimally regarding both the risks and the appropriate uses of intermediate driverless technology such as guided cruise control. In addition, enterprise liability could incentivize automakers to restructure the ways that automobiles are insured and sold in order to improve driver care and activity levels.
Under an enterprise-liability regime, automakers would have an incentive to shift contractually much of the expected costs of auto accidents to auto insurers. If automakers could get auto insurers to take on somewhat more of the risk of auto accidents, the insurers would have a strong incentive to help drivers reduce expected accident costs. That is, because of competition for customers in the insurance industry, auto insurers would be incentivized to use the tools at their disposal—including individualized, driving-behaviorsensitive, risk-adjusted insurance premiums—in ways that would tend to encourage better driving habits and perhaps less driving, especially by high-risk drivers.
What does this mean for how auto insurance would be sold? Auto insurance under an enterprise liability regime might be sold in the same way it is today. An individual auto purchaser, in other words, might pay the automaker for the vehicle itself and then purchase a separate auto insurance policy at the same time from a separate auto insurance company.
However, given that automakers ultimately would be responsible legally for the autoaccident losses paid by the auto insurers, there would be strong incentives for contractual coordination between automakers and auto insurers. Individual auto manufacturers might even be induced to partner with particular auto insurers in an effort to offer the best, most competitively priced combined product of vehicle and vehicle-insurance coverage.
Another way that enterprise liability could improve driver care and activity levels is through its effect on how automobiles are sold. For example, the introduction of an enterprise liability regime might push the automotive industry in the direction of lease transactions rather than outright sales because leasing would make it easier for automakers to enforce the terms of the auto insurance policies sold by an insurer that is contractually partnered with the automaker.
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In addition to favoring leasehold arrangements, the introduction of enterprise liability might create market pressure on auto manufacturers to sell vehicles to commercial purchasers rather than individual consumers. These commercial purchasers, in turn, would either lease the vehicles to individual drivers or perhaps make them available through ride-share arrangements. I am not suggesting that comprehensive automaker enterprise liability would necessarily result in auto-lease arrangements replacing individual sales or ride-sharing replacing driving.
Rather, once automakers are made legally responsible for the cost of auto accidents or for most of those costs , they will have an incentive and the ability to structure automobile distribution markets in ways that are more efficient. This description of an automaker enterprise liability regime is only a rough outline of an idea, a jumping-off point for further discussion. Would it be for the useful life of the vehicle or for some period of time—say, 10 years? If for some period of time, who would be responsible for covering the accidents arising out of the later use of the vehicle?
Presumably, rescission of coverage by the insurer because of excessive accident experience or the failure to pay premiums would result in a suspension of driving privileges, but how would that be enforced? Or would older vehicles made before the new law goes into effect be transitioned into the new regime over time? If older vehicles were fully exempted from the new regime, how would we deal with the resulting potentially large price differential between new vehicles which would be priced with full accident costs internalized into the purchase price and used vehicles which would not be?
What role could increased mandatory minimum levels of auto insurance play in assisting with that transition? All of these are fair questions and would need to be considered before auto enterprise liability were seriously considered. A Cautionary Tale About Energy Efficiency Initiatives If these programs are such bargains, then why does government mandate them and energy utilities push for them? If these efforts are such a bargain, then why must government mandate them and utilities push for them?
Supposedly, these factors lead to consumers making incorrect calculations and tradeoffs between the initial costs of appliances and their subsequent energy-use costs. Instead, they buy cheap durables that are costlier to run over time. If the present value of cost savings from an efficient appliance is greater than the incremental cost of the efficient appliance relative to a conventional substitute, then an EE gap is said to exist. The presumption is that consumers are incapable of making the correct calculations or else make decisions contrary to their self-interest.
Hence, there is an economic rationale for government policies such as energy building codes, appliance standards, and utility subsidies. The gap truly represents a market or behavioral failure. Energy consumers who do not invest in seemingly cost-effective EE can be acting rationally. To understand why, we must keep in mind three additional factors. First, consumers have difficulty verifying energy savings claims.
Past energy prices have varied dramatically; they were. Thus, consumers have reason to balk at making EE investments because of uncertainty over whether those investments will pan out. The second factor is consumer heterogeneity—the simple fact that different people use energy differently.
The third factor is the need to consider costs borne by consum-. These include transaction costs e. Utility-sponsored studies of EE proposals often yield results that are much more optimistic about energy savings than subsequent academic, peer-reviewed studies of the programs once they are in place. Why does this happen, and whose results should regulators believe?
The combination of these factors, according to some academic studies, has led to. The common perception is that residential weatherization programs have produced large and cost-effective savings to lowincome households. Most utilities fail to apply the best analytical tools to their evaluations of EE programs. These tools include randomized trials and quasi-experimental designs to measure energy savings and understand consumer behavior.
The problem with other approaches is that they do not reliably measure the actual energy savings from individual EE programs. Despite the negative evaluations of EE programs by academics, these programs are politically popular. These initiatives have been instrumental in mitigating utility opposition to EE programs. But is it equitable and good public policy to compel utility customers to pay for EE initiatives? Besides, these consumers are quite capable of making rational decisions, just like they do when they invest in other activities.
So, why should utilities offer these customers subsidies and why should other customers bear the costs? Utility-sponsored ex-ante studies of energy-efficiency proposals often yield results that are much more optimistic about energy savings than subsequent academic, peerreviewed studies of the programs once they are in place. This reduces the actual energy savings relative to those predicted by engineering possibilities. The subsidies they receive for purchasing their EE products are pure transfers from other utility customers, many of whom are low-income households.
EE building codes have also produced less-than-expected energy savings. For instance, a American Economic Review. After all, shale gas has greatly increased the supply and lowered the cost of gas, thereby altering the energy efficiency calculus. Yet, gas utilities now spend. Their customers have better information on EE programs, and natural gas prices are low and expect to remain so for the next several years.
Presumably, the most cost-effective actions have already been exploited. Thus, market failures for EE have decreased over time, lessening the need to have utility or government intervention to advance EE. Both electric vehicles and electric heat pumps presently receive subsidies from both the government and utilities. Technological advances and public policy e. Lacking today is evidence that market and behavioral problems.
The best available evidence suggests that EE programs transfer money from some utility customers to others with no gains in efficiency. The Electricity Journal 31 1 : 1—7 Hausman and Paul L. The Energy Journal 37 1 : — American Economic Review 10 : — October Jaffe and Robert N. Resource and Energy Economics 16 2 : 91— May The Energy Journal 37 4 : 1—23 The Energy Journal 13 4 : 41—74 Utility Energy Efficiency Initiatives Are Good Policy These programs address important market failures and have been shown to be cost-effective.
From the outset, some critics leveled three arguments against these programs. There are insufficient evaluation data to demonstrate that energy efficiency programs are cost-effective. Economy and former director of evaluation at the Michigan Public Service Commission. Total annual utility spending on energy efficiency programs has increased seven-fold since However, given that the old criticisms have resurfaced in recent years, this brief article offers some updated responses.
Consumer choices? For examples of this literature, see the U. With respect to the criticisms of evaluation methods, some of those concerns had some validity in the early Flawed research? But practitioners have subsequently recognized those concerns and taken steps to address them. Evaluators now routinely take free-ridership into consideration when evaluating programs.
Similarly, evaluators have contributed feedback to improve ex-ante engineering expectations in program planning, which has led to less divergent estimates between the ex-ante and ex-post estimates. Instead, the program evaluation profession uses a variety of technically sophisticated quasi-experimental methods to try to answer important policy questions using the best empirical evidence. Such methods are widely used in many other professions, from advertising to education to mental health. While we support the greater use of randomized experimental design in the evaluation of energy efficiency programs, to suggest that anything short of a true randomized experiment is not methodologically sufficient is a poor criticism and ignores the limitations of such.
Our view is echoed by the State and Local Energy Efficiency Action Network, which provides guidance and recommendations on methodologies that can be used for estimating energy savings resulting from energy efficiency programs. Insufficient data? This claim clashes with the seriousness of program evaluation professionals.
IEPEC has been providing training and conducting conferences on program evaluation for over 30 years, with hundreds of peerreviewed professional papers being published and cited in regulatory proceedings as well as the academic literature. Utility regulators also take their jobs very seriously and offer another buttress against the claim that evaluations of energy efficiency programs produce biased results. Nearly all states require that evaluations be conducted by independent contractors rather than by utility staff.
Proposed utility programs and utility energy efficiency program results are typically examined in contested case proceedings where all interested parties are free to challenge those results. One of the authors of this paper was the director of evaluation at a utility regulatory commission for 10 years and would argue that, dollar for dollar, no other area of utility expenditures receives as much scrutiny as energy efficiency programs.
Despite extensive. Absent requirements and regulatory mechanisms such as decoupling and performance incentives, utilities simply would not provide—and historically have not provided—serious energy efficiency programs for their customers. Utilities are regulated monopolies that operate under all sorts of government mandates in exchange for their franchise.
So, if energy efficiency programs are in the public interest e. Finally, as to the fundamental question of whether these utility energy efficiency programs are a good value, the evidence is overwhelming. There are literally thousands of individual reports documenting the effects of these programs many of which are cited in the IEPEC archives noted above. This extensive analysis is itself testimony to the fact that utility regulatory commissions require extensive scrutiny of energy efficiency programs.
How many independent evaluation reports have been required and published for other utility expenditures, from bucket-trucks, to transformers, to billing systems, to company management structures, etc.? A previous ACEEE report by Molina summarized the results from 10 different states across four years of programs and found an overall utility cost of 2. A LBNL study by Megan Billingsley examined over programs across 31 states over a three-year period and found an average total utility cost of 2.
All of these average costs are well below the utility system avoided cost for delivered electricity and natural gas, demonstrating clearly that energy efficiency is indeed a cost-effective utility resource. This is true even in an era of very low well-head natural gas prices. And the risks associated with that era being temporary is a whole other subject.
The best available evidence robustly demonstrates that utility energy efficiency programs have been a cost-effective utility resource. Regulators should of course continue to exercise good oversight, but there is no basis for abandoning the policy and regulatory framework that facilitates these programs. The Electricity Journal 7 4 : 29—49 May Department of Energy, June Schiller, and Charles A.
Lawrence Berkeley National Laboratory, Energy Efficiency 7: — Golove and Joseph H. Hoffman, Charles A. Goldman, Sean Murphy, et al. Billingsley, Ian M. Hoffman, Elizabeth Stuart, et al. The Energy Journal, 17 1 : 31—51 To make this vision a reality, our focus will always remain on results.
Through high-quality research, outreach, and applied programs, our ideas are changing the world of thinking. Regulations and He already has many fans among libertarians and classical liber- other interventions have a similar effect. Perhaps, as we shall see, he should have more admirers among Because individual preferences are subjective, there is no sciconservatives, too. Even if only one individual is harmed the membership card of the academic class.
He retired in , moved to Normandy, and devoted the rest of his life to independent scholarship. He was nearly blind for most of the years I knew him; in his last book, Social Justice and the Indian Rope Trick See his wife Isabelle would read aloud for him.
John Lawrence Crocker (born February 13, ) | Prabook
Putting a money value June By that time, he had suffered a stroke from which he on gains and losses from a government intervention does not had not totally recovered. On June 4, I published a review of his solve the problem; only an actual voluntary exchange can guarmasterpiece The State in the new Liberty Classics section of antee that both parties gain.
The state buys the consent of the clients it needs whole apparatus of formal government. The state cannot please in order to stay in power. A democratic state does not change that. On the contrary, it is a formal feature of the democratic state that it must satisfy a majority of the electorate. The state has no money but what it takes from its citizens. As time goes on, the state becomes more and more of a redistributionist drudge.
While its total power has increased, its dwindling discretionary power is used just to stay in power. At some point it will have no choice but to limit electoral competition and put all its former clients under its yoke. Tyranny must be the ultimate outcome. By following established conventions, individuals contribute to the requirements of social cooperation, as shown by game theory in repeated interactions. Buchanan wrote in Public Choice a very favorable review of The State despite the fact that it represents a major challenge to his own political theory. For example, Buchanan would say, everybody equally benefits from national defense or locally from a floodcontrol dam once those goods are produced.
Free-riders will not pay for such goods, hoping that others will. The state ostensibly has to intervene and tax people to produce what everybody wants. De Jasay, on the contrary, argued that contractual means and voluntary institutions exist to produce public goods. Many consumers will not want to risk the chance that a public good they want will not be produced, so they will not take the gamble to free-ride. One instance of government failure is that production. If it then tries to satisfy the latter, it will make others unhappy.
Can society exist without state laws and social justice? De Jasay argues for a theory of justice based on evolved conventions that simply prevent wrongs and thus circumscribe exceptions to a general presumption of liberty. Another major point of discord between de Jasay and Buchanan is social contractarianism. Buchanan imagined an implicit, unanimous social contract that calls on the state to produce public goods while at the same time limiting the reach of the state.
De Jasay countered that if individuals are capable of unanimously agreeing on a social contract, they also are able to contractually agree to the production of the public goods that supposedly justify the social contract. He also argued that a presumed social contract fools people into believing that they are, as it were, coerced by themselves, thus disarming resistance and strengthening Leviathan. He did not try, like many libertarians, to be everything to everybody. The conjunction of anarchism and conservatism may look strange, but classical liberalism and anarchism are clearly related.
For both theorists, the state is dangerous and anarchy would be the ideal. Buchanan thought that a limited state was necessary to protect ordered anarchy, while de Jasay believed that limiting the state was a mission impossible. But both agreed with what we could call the primacy of anarchy. This provides us with a principle for evaluating all things political. De Jasay went much further than Buchanan on the road to anarchy. In a sense, de Jasay combined the best in classical liberalism, cultural conservatism, and anarchism. In that, too, he and Buchanan were similar.
But de Jasay was not an optimist. He was not sure that anarchy could survive if it were to appear again in the world as it appeared before in primitive societies. And constraining Leviathan, he argued, is impossible. I would suggest that we should try, even while keeping the focus on anarchy as an ideal. In this task, the work of Anthony de Jasay will be very useful.
If individuals are able to agree unanimously on a social contract, they are also able to contractually agree to the production of the public goods that supposedly justify the social contract. Where exactly does this put de Jasay on the political spectrum? He seemed suspicious of universal values, yearning instead for the close community where conventions can be voluntarily enforced. All that seems more conservative than liberal. His defense of property also looks at least as conservative as liberal. He invoked against immigration the strange argument.
The answer to both queshe question in the title of this review is paraphrased from tions is negative. As for the welfare state, it does not justhe new book by Bas van der Vossen and Jason Brennan, phitify cutting immigration. Their book, In Defense of Openness, presents a strong, well- use the welfare state more than the natives. Thus, there is a although this would raise other issues. Their case is primarily a moral just as such a presumption argument proposed notably case: morally defendable individual rights applies within a given counby economist Paul Collier.
This presumption may Van der Vossen and Brennan borders. They also pres- normal economic freedoms along their cultures, ones ent an economic case for openness, which stop at a political border that lack support for the rule is the only way to increase prosperity over because they are superseded of law, democracy, and freethe whole planet.
It is an interesting book by the group rights of people dom. For example, liberty. This is not easy to do. Humane Solution to and with it social stability economists have shown that the quality and liberal freedom. Certainly not features of free societies that in any theory of justice. What is needed by economic arguments, the University Press, make them attractive.
Open immigration would believe in the presumption of liberty.
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The two philosophers, who know terarguments. Immigration cannot generally push is not likely. Second, the authors admit that. And if it were legitimate to block illiberal immigrants in order to preserve the liberal society, would it not also be legitimate for, say, Virginians to protect themselves against West Virginians? We are back to the need to defeat the presumption for liberty in order to oppose international openness. Is the invasion objection so easily dismissed? It is more a matter of informal institutions being toppled by an invasion of people with different cultures.
Think about the rules of tolerance. Or think about trust, a certain level of which is important, especially in a free society. Some research suggests that trust can be best, if not only, maintained among individuals who generally follow the same rules and share the same culture. Assume a million-strong liberal soci-. Predictability of human behavior will diminish. Mistrust will increase. People will self-segregate in different enclaves. Individuals will feel more and more insecure. To maintain some sort of social peace, laws will eventually change.
Social relations will become more regulated and individual liberty more controlled. The parties to a Buchanan-type of implicit social contract would see their country as a club with a controlled membership precisely in order to preserve their liberal institutions. This approach, which Van der Vossen and Brennan do not discuss, would not justify completely closing the border to foreigners. It is unlikely that the contracting individuals would unanimously agree that, for example, foreign spouses could not immigrate or that citizens could not hire foreigners as nannies or business employees.
But it could justify some reasonable and not-illiberal control on immigration. Van der Vossen and Brennan argue that the right to trade internationally is, just like the right to trade domestically, a basic right that is essential for an individual to pursue justice and the good life—notwithstanding philosopher John Rawls. The moral presumption for the freedom to trade internationally seems as irrefutable as other economic freedoms.
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The economic case reinforces the moral presumption: free trade has been shown to lead to increased production and a radical drop in poverty. The authors could have added to their arguments that free trade between California and MissisFree trade: a simple case. In Defense of Openness finds that no good philosophical argument overcomes the moral presumption for free trade. Working there is the best option for the poor who choose it; otherwise they would have chosen another option among those open to them— scavenging dumps or prostitution, for example.
Closing a sweatshop amounts to removing the best option of its workers, making them worse off. The two philosophers also answer an argument of Aaron James, a philosopher at the University of California, Irvine. Abolishing a tariff or another obstacle to trade , James argues, hurts those who benefited from it just as establishing it hurts those who previously traded freely.
In both cases, he claims, some lose and some win, and there is no presumption one way or the other. Van der Vossen and Brennan emphasize that the ban of a liberty does not have the same moral status as the restoration of a liberty. Note that a Buchanan type of social contract creating an island of liberty cannot conceivably limit free trade as it can constrain immigration. On the contrary, the power to limit trade with foreigners would put too much power in the hands of Leviathan.
The two philosophers point out that the depredations of the natives may explain as much. Many philosophers, such as Thomas Pogge of Yale University and Nicole Hassoun of Binghamton University, argue for some form of international redistribution toward poor countries. There is no need for morally and economically doubtful redistribution, reply Van der Vossen and Brennan. What is needed is simply to stop the current injustice of governmentimposed obstacles to international trade and mobility.
Foreign aid cannot be defended from either a moral or an economic viewpoint. Experience has shown that trade liberalization is the way to cut world poverty. Trade, not aid! Free trade is justice. To the con-. But economic growth requires international openness, which would also allow the people who are most harmed by climate change to move to more hospitable places. Van der Vossen and Brennan provide several strong arguments for abolishing at least some immigration restrictions, but I have argued that completely open immigration is very questionable.
At any rate, the book remains a good antidote to the current irrational discourse and callousness against the convenient scapegoats that immigrants represent. Yet policymakers and program advocates seldom conduct careful analysis of these programs to determine how well they work. Given how many states use these programs liberally yet fail to even keep up with national job-creation rates, one suspects these efforts are largely ineffective. So why do these programs continue to multiply? In this new book, Nathan Jensen University of Texas, Austin and Edmund Malesky Duke University advance original arguments that explain the ubiquity of these incentives and offer technically feasible and politically practical reforms to rein in these programs.
Less well known is the aggressiveness of city and county programs. One example Jensen and Malesky share is Lenoir, NC offering a quarter-billion dollars in incentives mainly tax breaks over 30 years to woo a Google server farm. The economic inefficiency of these programs is a recurring theme in the book. Rather than making domestic ers moving from the east side firms. Jensen incentives even if they fail, icy? And why do politicians and Edmund J.
Politi- cians pay for these programs? Oftentimes, University Press, than hide them? Incentives create a reverse of knowledge of their true costs. Politicians will use incentives, residents. Critics of incentives should explore of incentives as an asset, not a liability. Apparently, politicians use not restricted to westincentives to signal alignment with voter attract jobs with incentives, even if they ern-style governments. In fact, counterparts. They begin by rejecting the announcement, while the other county tocratic promotion for sub-national leadthe argument, commonly found in the experienced an employment increase of ers.
Central government elites want gross popular press, that incentives are driven only 0. Capital movement influenced by and employment growth, and are agnostic campaign contributions. Aging Vietnamese officials, Jensen and Malesky observe, abandoned the use of tax incentives once they became ineligible for promotion. Jensen and Malesky pose a series of questions about incentives that should be answered by every politician contemplating their use. Are they worth the cost?
Are they effective at attracting or retaining investments? Do they generate jobs and are those jobs worth the cost? Are the incentives the only option for generating economic development? Most incentive-happy politicians answer in the affirmative. One recent exception, to some extent, was Michigan governor Rick Snyder. But he also signed a executive order dissolving the Michigan Economic Growth Authority MEGA , established in over the objections of the Mackinac Center, a market-based think tank, and state legislators.
Disclosure: I was among those critics. Since the U. Invert those circumstances by postulating a state that does not use incentives and records negative jobs growth, or a state that ends a program like MEGA and trails the nation in jobs creation, and what would political commentators say?
Researchers, good-government activists, and policymakers can use other strategies to challenge these programs. State-level researchers focus on local programs. Written performance criteria provide greater transparency. This book, Fighting Financial Crises by economists Gary Gorton and Ellis Tallman, supports the latter version of the standard narrative.
Interestingly, the book liberally cites fellow standard narrative advocates Ben Bernanke and Timothy Geithner, who were the chief architects of the U. Gorton is a professor at the Yale School of Management and is widely known for.
Find the short-term debt causing the instability run. Open emergency lending facilities. Prevent systemic too-big-to-fail institutions from failing by bailing them out. Circumvent any laws and regulations that stand in the way of this response. The authors open the book with a deep dive into the National Bank panics of the Gilded Age. They divide these into more severe panics , , and and less severe panics , , , in order to judge the prudence of interventions in each panic.
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If a bank did not follow the recommendations incorporated into an examination report, it could be suspended or expelled from NYCHA membership. Gorton and a case study of a bailout by Ellis W. MNB was double the size of the average clearinghad their origins in similar bailouts through the NYCHA house bank and was quite during the 19th century. The authors have taken stories from the contemporary New York press and employed available financial data from bank reports to develop a narrative and accompanying tables that bring to life the panics of that era.
Where their effort falls short is in the policy conclusions they draw from those details. Since the creation of the Fed and the proliferation of government bailouts in the last century, Citi has now morphed into a perpetual ward of the state. This would have been a good moral hazard case study for Gorton and Tallman to consider. Unfortunately, it seems they already had their chosen narrative and stuck to it. His latest is Can You Outsmart an Economist? They range from easy to difficult. What happens to the price of bread? A student of economics knows that price ceilings cause shortages.
Wheat will become scarcer, the supply of bread will decrease, and the price of bread will rise. Puzzle solved. Now consider a more difficult puzzle: My wife and I each drive exactly the same number of miles every day and would continue to do so even if we upgraded our vehicles. Better solutions to puzzles anticipate changes in behavior. If a new rule required each infant to be strapped into a separate seat, how many infant lives could be saved?
Landsburg asks: Under the new rule, how many families would choose to drive rather than pay for an extra airline seat? How many of those families would be involved in car accidents? How many of those car accidents would result in infant fatalities? Answers calculation.
One question asks how much men earn. On one level, this would pay to remove one of those bullets. Your Brain apple to cherry. For instance, Landsburg enjoys half the labor force is women. Of the When the waitress mentions ity and statistics in which a trend appears other third, they pay half to bondholders and half to stockholders. In perhaps the best-known total value of the stock market are equal. Half the what else might account for the gap. This reviewer wants to question a few genbesser would pick apple. Four of six departments accepted a assumptions. If the labor force consists of berry, prompting Morgenbesser to pick greater percentage of women than men.
Landsburg agrees so long as Mor- How did a smaller share of all women increasingly difficult to substitute lower- genbesser pays a nominal charge for the get accepted overall? Landsburg explains, paid women for higher-paid men?
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In order switch. If the latter, money out of Morgenbesser and proving lowest acceptance rates for women. Meanand corporate balance sheets show more that Morgenbesser is irrational. By ques- quiz that evaluates how rational they are. There are many I was unable to solve, though I could understand the solution once I read it.
Some have solutions beyond my understanding. But this is only scratching the surface because Albert cannot recall at which intersection he is. Half the days he makes it to the second intersection. Does this change the probability that Albert gets home? Landsburg leaves whatever applications there are to. The puzzle serves to show the extensive amount of thinking one can do beyond the obvious. He introduces puzzles he has known since his childhood as well as some that perplex full-time thinkers. One should expect a few humbling experiences. Those are some of the questions Tyler Cowen considers in Stubborn Attachments, a book of political philosophy informed by economics.
Cowen is a creative thinker who teaches economics at George Mason University. How many lives in years are equivalent to one life today? Multiply 1 one life by 1. The result is 39,,, lives. The magic of compound interest is always amazing. It may thus be argued that, as far as human lives are concerned, the discount rate for the far future should be zero or at least much lower than what we usually assume. This means that if we have to choose between different paths of economic growth—what individuals will be able to consume in goods or leisure as time passes—the path that is consistently higher should always be chosen.
It is moral to choose to have more today only if this choice also implies that individuals in the future will obtain more than they would have received otherwise. One implication is that environmental problems, such as climate change, gain a heightened importance if they will retard economic growth long-term. More generally, we should be concerned with the longterm future of our civilization. Money may not buy happiness, but it certainly makes life easier.
Do the long-r un benefits of economic tributes to happiness. To GDP, Cowen growth sidestep the aggregation probprefers a theoretical concept that he calls lem, as Cowen claims? His notion agree on what Wealth Plus means. This years. Keep in given individual. We cannot measure cardi pp. It does seem to. The reader—or at least this one—would have liked to hear more from Cowen on that.
This seems to make sense. Economists are natural consequentialists: they are interested in the social consequences of individual actions and public policies. It is a troubling problem. He would not have been Hitler. He could have become the grandfather of a second Mother Teresa or, better for economic growth, the father of another Jeff Bezos. Changed genetic identities change the genetic identities that follow.
Cowen argues that the epistemic problem should not paralyze us. It should instead bring us to focus on big actions more likely to push in the right direction. This may not be a totally satisfactory answer, but Cowen is after some common-sense morality. The exercising a right would generate very large book contains an interesting discussion. One reason, of course, is that self-sacrifice by everyone would be selfdefeating because there would be nothing to share; productive people in developed nations would soon lose their motivation to produce. Cowen continues to sail close to common-sense morality—or at least to what people in the classical liberal tradition consider such.
The book does not clearly answer the question of whether or when redistribution by the public sector is preferable to private charity. But the author obviously thinks that private charity and perhaps some public redistribution is good if it contributes to long-term growth. A short postscript explains how Cowen feels a stubborn attachment the second and only other time the expression appears in the book. One of the many originalities of Stubborn Attachments is how it invokes Ayn Rand, with some caveats. Rand almost certainly would not have given money to an Ethiopian quidam.
In many ways, Cowen shows a path to an open and enlightened libertarianism. First, he was one of the founders of Reason magazine in , giving the nation a consistently libertarian investigative magazine. This book brings together decades of his research with the objective of showing how we could enjoy a far more efficient highway system if we would shift away from the heavily politicized approach to roadway funding that has predominated for more than a century, in favor of a utility model.
In short, Poole argues that we should build and maintain our roads the same way we build and maintain our water and electric utilities: customers pay companies for their use. Ever since the Great Depression, we have relied primarily on the federal gas tax to provide the money needed for roadways. At that time there was no convenient way to meter the amount of driving Americans did, so the best way to fund road construction was to tax gasoline and diesel purchases.
Over the years, Congress often raised the amount of that tax, but it has not done so since The taxes on gasoline and diesel have been Moreover, fuel economy has improved steadily and a small but growing. As a result, the federal gas tax is less and less able to pay for our current highway system, much less any major upgrades. And our highway system certainly could use some upgrading.
He likes cool, sober analysis. Prospective efficiency improvements are often delayed or completely sidetracked because each representative wants some chunk of the spending for his district. Democracy has saddled us operates there. Beginning with a very suboptimal highin , the French have way system. Poole Jr. Privately financed and operated toll Unfortunately, private roads suffered roads are not, of course, unknown in the from travelers avoiding paying the tolls. United States. Poole recounts in great Most toll road companies went bankrupt. It roads must be provided by government was the brainchild of Reagan administratook hold.
However, modern technology tion transportation official Ralph Stanley, has found ways to prevent this public who lobbied for the necessary legislation goods problem—if only the United States in Virginia and then oversaw the project, would give private roads greater support. Privately immediate success. For example, the and abroad. The Asia, and South America for decades. The tor-owned toll road in and a net- Dulles Greenway also experienced defaults work of privately owned highways now in its early years and underwent a massive. The bulk of the book is about highways, but Poole devotes a chapter to possible improvements in urban expressways and arterial roads.
He envisions transponder technology, which enables road companies to bill drivers based on the amount and times they use roads as the key to revitalization and improved efficiency. But there are some powerful opposition groups who want to prevent that from happening. Antitoll forces of this sort have been especially effective in Texas. Finally, there are interest groups that are wedded to the status quo.
In , when Pennsylvania Gov. Ed Rendell advanced a plan to privatize the Pennsylvania Turnpike, the existing toll authority fought and eventually defeated it.