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Prison Labor

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hellothere posted on Wed, Jul 6 2011 11:30 PM

I'd like to cite an Austrian economist or political philosopher on the topic of prisoner labor.  Prison labor is clearly a violation of free market principles, but I can't find anything written on the topic.  Any help would be appreciated.

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I'll add more as I find some, but just at first glance,

 

"The Tyranny of Government Courts and Prisons"

 

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If I remember correctly, there is some stuff in Bruce Benson's - The Enterprise of Law about private prisons employing prison labor in order to help pay for the facilities or something like that. I'm not sure that's what you're looking for but that's the only thing I remember coming across on it. 

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I'm talking about the use of prisoners as a source of cheap, state-controlled labor.  I've seen a lot of left/liberal commentary on this phenomenon, but it seems like the Austrian school would also oppose this.  I'd be interested in hearing people's thoughts.

http://www.alternet.org/story/150777/defense_contractors_using_prison_labor_to_build_high-tech_weapons_systems?page=entire

http://www.thenation.com/article/37828/bp-hires-prison-labor-clean-spill-while-coastal-residents-struggle

 

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There are three areas of discussion here, one Austrian, one libertarian, one moral.

The Austrian question is a scientific one, with no judgements. Just as the science of physics will study how to make nuclear weapons without entering intoi the question of whether making such weapons is good or bad, so too austrian Economics studies the question of the economic effects of using prison labor, without going into the question of whether such effects are good or bad.

Then there is the Libertarian philosophical question. Many Austrian economists are libertarian, and vice versa, but the two areas of study are distinct. The question here would be, whose libertarian rights, if any, are being violated when prison labor is used?

Finally there is the moral question. Now that we know the effects of using prison labor on all parties involved, and we know whose rights are being violated, if anyones, let us sit back and decide what the Right Thing is in such a situation. This last is, of course, the trickiest, because it is very subjective, and difficult to impossible to prove, what the Right Thing is any situation. 

From the articles you linked to, I imagine the main question you are asking is what's with using prisoners, and thus depriving honest hard working people those jobs taken by the prisoners?

Let's begin with an extreme case, slave labor. Austrian economists claim that their research shows slave labor to be financially unprofitable to the economy as a whole in every society it was implemented. Indeed, the articles seem to indicate that the states are losing lots of money keeping prisoners, with the profits of having them clean up the spills being a drop in the bucket to what it costs to feed them, house them, guard them, etc.

From a purely economic standpoint, the best thing to do is set them all free.

But let us assume that, right or wrong, someone has decided that these guys are not going free, let the cost be what it may. What does AE say about such a situation? In such a case, the question becomes, what is the effect on an economy of using these prisoners instead of union workers? [Remember, we are discussing the economic effects, not the question of right and wrong. That will come later].

One key thing to keep in mind is that we should not look at the effect on one small group only , such as the prisoners only, or the taxpayers only, or the unions only, but the effect on everyone.

AE says that the more voluntary the situation, the better it ultimately is for the economy as a whole. Now we are assuming that the prisoners have no say in the matter. They cannot bargain with BP for a higher wage, or join the union. They are stuck with whatever deal the warden makes with BP. In other words, they are so many cattle at the disposal of the warden. Given that situation, AE claims that whatever agreement is voluntarily agrred on between the parties involved, BP, the unions, and the warden, is the most productive one for the economy as a whole. In other words, if the warden outbids the union workers, as seems to be the case, that is economically best for the largest group of people. In this case it is all the consumers who are getting a good deal by BP saving money and being able to sell their stuff more cheaply. Thus all other sectors of the economy benefit as well, since the consumer has more money left to buy other goods and services. The consumer puts more food on the table, more jobs are created in all othe industries, and the economy thrives.

If the unions manage to coerce BP, by law or by other violence, to hire them only, that means the entire community is being coerced as well, to lose purchasing power and jobs, and hand the money and the jobs over as free gifts to the unions.

That is the purely Austrian analysis of the situation, with no judgement placed on what is the right or wrong thing to do.

Now for the Libertarian question. Whose rights are violated in such a situation? I'm very ignorant on these matters, and leave it to others. My guess is that the prisoners and the taxpayers are having their rights violated.

Finally, the moral questions. Is such a situation Right? If not. where are the Wrongs with this picture?

And a sub question, given that the prisoners are to be prisoners, should all consumers lose money, all industries lose money, and all workers lose employment, whether they want to or not, to give the union workers jobs and money?

I will not attempt to answer these q's because as I said before, they are very subjective.

 

 

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Answered (Not Verified) jkarto replied on Mon, Aug 29 2011 11:19 AM
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There are series of effects because of intertwined relationships between blow-back (blow and blow-back) and Austian Economics (AE) in America currently that could happen anywhere: 1) On the free market price of labor assuming that the prisoners cannot control the cost of their own labor, there are prisons in places in the world such as India where prisoners work in the outside community and have total control over the value of their labor. Basically my understanding is that AE focuses on how central economic planning modifies price by affecting the supply or demand one way or another in a way which would not happen under market conditions. That being said by creating any group of individuals without control over the price of their own labor the entire labor market in which they participate would be affected by creating labor at a much lower price in abundant supply this would shift the supply for this kind of labor up and the price down increasing demand artificially for this labor for return on profit. (AE-1) 2) Essentially then. these goods if they are are produced using labor at a fixed unreal value. are already then produced above demand causing the price of the products to be low however, artificial demand will likely have to be put into place by way of a stimulus in order to keep up demand at a consumer level or simply just allow for a consumer demand correction and change the production of goods, this can be satisfied with militarism easily. (AE-2). Also this has to be funded one way or another taxes or inflation directly this causes an increase in the supply of money without an increase in demand causing a decline in the price of money (AE-3). 3) This will then cycle into the economy by causing an artificial demand for militarism (blow-1). requiring an increased demand for prison labor products at an artificial price. To maintain this price requires an increase in prison labor input or an increase in efficiency via lower income to laborers. This then creates incentives to imprison a population (blow-2). 4) Continued militarism as a result of supply mentioned in AE-2 creates it's own corrections as wars have to end as occupying forces present as a result of the militarism in (blow-1) native hostilities build creating Blow-back (blow-back 2) resulting in the dramatic reduction of demand for the supply of the product of prison labor because of artificial price (AE-4). 5) AE-4 can however be avoided wit consequences: Continued militarism must happen in another land creating a new blow-back cycle which can be completed over time and would likely continue on as there would be minimal incentive to stop them. An formerly unaffected area would attempt to have competitive labor prices with the prison labor climate in an artificially created market (AE-5). 6) Eventually, the artificial demand for militarism exhausts the people via AE-3 and the cycle of Blow-back begins within the community (blow-back 1). 7) If the cycle of Blow-back 1 continues eventually the entire economy will fail as a result of the destruction of the labor market by creating artificially cheap supply of labor, resulting in a reduced demand for labor that is not prison labor (AE-6). Three things though: I'm not an expert on AE I just understand how to mess with supply and demand really well. Anyone could come to these conclusions after reading a few books on economics. Personal note: Nothing makes sense at a price of zero i'm surprised that prison labor isn't illegal under slavery laws, there ought to be a constitutional amendment guaranteeing people the right to determine the price of their labor within a free market and it ought to be enforced. I agree with you that prison labor is a big problem because it creates a loop of poor economic incentives which otherwise divert attention from wise investment. I go to the extent of believing that stock ownership is wrong in that I don't believe that exclusively contribution of a portion of capital should someone have the right to the profits made off of the value of the labor capital of others.
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