I've long suspected that there is a problem with the evolution of street cleaning in a free market. Imagine a shopping district which tends to become cluttered with rubbish, making the area less attractive to shoppers. Suppose that if all the shop keepers banded together and contributed to hiring street cleaning services for the area then there would be a net benefit in terms of extra visitors that would lead to extra profits that are greater than the cost of the cleaners by some small margin. Now the problem is that if one of the shop-keepers does not want to join the scheme then what can be done? The other shop keepers can not force him to join in. Now the shop keeper that won't pay causes all sorts of problems: 1. it means that the others will have to pay more and the cost benefit equation may no longer work. 2. Other shop keepers may get angry and say "well if he's not paying then why should I". The system may all too easily fail or not get off the ground in the first place.
I've just read "Economics in one lesson" by Henry Haslitt and noted that on page 69, "street cleaners" is included in a list of "public officeholders whose services are really needed", so maybe Mr Hazlitt agrees.
I also remember that there were examples in "The selfish gene" by Richard Dawkins where he shows how certain groups of animals behave sub-optimally (with respect to avoiding predation) because the "optimal" behavior can not evolve due to problems almost identical to the street cleaner problem.
So my question is this: Do Austrians acknowledge that there are a variety of "services" or "institutions" that are of benefit to society that will not evolve naturally from a free market that should rightly be set-up by a government? Is there a list somewhere that most austrians would agree upon? For example police? teachers? street cleaners? "a legal system"? infrastructure builders (road/rail)?
What Went Wrong with Economics
Knight_of_BAAWA: My question to you regarding your challenge is: why? Why should we try to find that? And then--what's it matter if we can't?
My question to you regarding your challenge is: why? Why should we try to find that? And then--what's it matter if we can't?
Ever since the recent crash I have been attempting to educate myself about economics. Two years ago I had never even heard of Austrian economics. I then came across assorted youtube videos by Peter Schiff. He seemed to make more sense than any other economist I had ever heard. I noted that he said that his thoughts were based on Austrian economics so I started looking in to that. I read economics in one lesson by Henry Haslit and liked 90% of what it said. I then started getting involved in some discussions on this forum. I soon discovered that this forum seems to be populated predominantly by anarchists who seem to believe that "the free market" will deliver almost everything that society would like - policing, water, electricity, roads etc, etc. But I also read (and loved) The Selfish Gene by Richard Dawkins and learned that evolution (which is rather like a free market) can be quite dumb and fail to do things that would in fact benefit the species. I then thought about whether some of the things like roads, water, electricity etc would work properly in an anarchist system. I started out thinking about street cleaners and I suspected that they could not evolve properly (hence this thread) - but the discussion seemed to morph in to one about roads. That was fine by me because the problems are closely related - I think private roads don't really work either except under certain special conditions (cul-de-sac's for example). I could be wrong of course and I am here to learn. I have learned many things on this site in my discussions and if someone posted up a message saying "hey didn't you know that all roads in XXXX city are private" then I would have to reconsider my position... but so far I've heard nothing so I'm going to be sticking with my conclusion: a private road network would not work properly.
mickanomics: Knight_of_BAAWA: My question to you regarding your challenge is: why? Why should we try to find that? And then--what's it matter if we can't? ... But I also read (and loved) The Selfish Gene by Richard Dawkins and learned that evolution (which is rather like a free market) can be quite dumb and fail to do things that would in fact benefit the species.
... But I also read (and loved) The Selfish Gene by Richard Dawkins and learned that evolution (which is rather like a free market) can be quite dumb and fail to do things that would in fact benefit the species.
1) Benefits are subjective.2) Evolution does not require property rights
Thus, your analogy is phail.
mickanomics:but so far I've heard nothing so I'm going to be sticking with my conclusion: a private road network would not work properly.
You fail at logic.
To paraphrase Marc Faber: We're all doomed, but that doesn't mean that we can't make money in the process. Rabbi Lapin: "Let's make bricks!" Stephan Kinsella: "Say you and I both want to make a German chocolate cake."
mickanomics: I then thought about whether some of the things like roads, water, electricity etc would work properly in an anarchist system. I started out thinking about street cleaners and I suspected that they could not evolve properly (hence this thread)
One of your problems is that you think that if it doesn't exist in a sufficient quantity now, that means it's not possible at all. That's not a logically tenable position.
Knight_of_BAAWA: Which is, as was pointed out, nothing more than Beheian irreducible complexity.
Which is, as was pointed out, nothing more than Beheian irreducible complexity.
Beheian? What's that? I just did a search for that word on this forum and it appears never to have been used before.
Knight_of_BAAWA: One of your problems is that you think that if it doesn't exist in a sufficient quantity now, that means it's not possible at all.
One of your problems is that you think that if it doesn't exist in a sufficient quantity now, that means it's not possible at all.
That is not my precise position. I do think that if such a road makes sense then it would *probably* exist already at least somewhere in the world at least at some time in world history. But the lack of its existence would not be *conclusive* evidence that it was unworkable, merely good evidence.
Note that that I have no problem with private small roads, cul-de-sacs, roads with little traffic, roads with few residents, and motorways... and hey-presto I see that there are tens of thousands of them in many countries all over the world, both currently and historically.
mickanomics: Knight_of_BAAWA: Which is, as was pointed out, nothing more than Beheian irreducible complexity. Beheian? What's that? I just did a search for that word on this forum and it appears never to have been used before. Knight_of_BAAWA: One of your problems is that you think that if it doesn't exist in a sufficient quantity now, that means it's not possible at all. That is not my precise position. I do think that if such a road makes sense then it would *probably* exist already at least somewhere in the world at least at some time in world history. But the lack of its existence would not be *conclusive* evidence that it was unworkable, merely good evidence. Note that that I have no problem with private small roads, cul-de-sacs, roads with little traffic, roads with few residents, and motorways... and hey-presto I see that there are tens of thousands of them in many countries all over the world, both currently and historically.
Have you ever built a ten-foot high table? If no, does not mean that it is impossible for you to do so?
Knight_of_BAAWA:Which is, as was pointed out, nothing more than Beheian irreducible complexity.
mickanomics:Beheian? What's that?
Knight_of_BAAWA:One of your problems is that you think that if it doesn't exist in a sufficient quantity now, that means it's not possible at all.
mickanomics:That is not my precise position.
The necessity of naming a privatized road network which touches five hundred homes makes it a bit difficult to present empirical evidence. The fact of the matter is that that arbitrary figure is meaningless. You have ignored a lot of good arguments. The fact of the matter is that people are not interested in a privatized road network that they have to pay for, because they receive it at a hidden cost already, which is through taxation. But, they are under the belief they are getting it for free, and the poorer the person is, the less they are paying. No wonder it's so difficult for a private road network to exist! If the State did not provide roads, however, no doubt a private road network would exist. I gave you the example of Spanish agricultural roads, because that's how I figure city/town residential roads would be.
Spanish agriculture is a near-perfect example of property rights for our purposes. Every single meter of Spanish soil that is not a national forest, or something similar, is owned by a private citizen. As a result, the fact is that (at least in Castilla-La Mancha) the government cannot provide a road network because they do not own the land. That land is not regulated like a city residential area is. It is completely the responsibility of the farmer to use part of his property to build a road. I see no reason not to believe that it wouldn't be similar if there was no State to provide roads in a city's residential area. The home owner would own a plot of land, and would need some type of road to get in and out of his or her house, and to work, et cetera. These are necessities, not really options. The road would be built to the quality necessary for it to be cost efficient (the benefits would outweigh the costs), just like agricultural roads in Castilla-La Mancha.
Your requirement of an existing example in a city is ludicrous. You fail to acknowledge the merit in our arguments, and instead of replying with any sort of logical rebuttal you make an inane request for an example which is obviously completely arbitrary in standards. I have already provided the only example you need. I'm not sure why you continue to hold that my first-hand example is unsatisfactory. It shows how a private road network would come into place given free-market property rights.
No offense to you but your comment is quiet short sited.
mickanomics: Imagine a shopping district which tends to become cluttered with rubbish, making the area less attractive to shoppers.
Large retail areas such as Mall's already privately control the means to keep their property clean. So ask your question to yourself if you think it's so hard to accomplish how is it that Mall of America can keep a tidy parking lot every day? Meanwhile the nike store pays for it by way of rent to keep a store presence in the mall.
Also, in this scenario of yours you forget that the road is owned by someone privately. What economic insentive does a private road owner have to let his road become trashy?
mickanomics:So my question is this: Do Austrians acknowledge that there are a variety of "services" or "institutions" that are of benefit to society that will not evolve naturally from a free market that should rightly be set-up by a government? Is there a list somewhere that most austrians would agree upon? For example police? teachers? street cleaners? "a legal system"? infrastructure builders (road/rail)?
I do not agree to this. Socialised services stagnate and new innovation to improve those industries is stifled. If you think the street cleaning industry sucks it's probably because it's being managed by City government. How can we arbitrarily define that some services are better left socialised while others are not without being hypocrits? You have to be consistent to have any moral integrity. If socialized cleaning is better for mankind then the socialized distribution of banana's must also equally be better.
Jonathan M. F. Catalán: Your requirement of an existing example in a city is ludicrous. You fail to acknowledge the merit in our arguments, and instead of replying with any sort of logical rebuttal you make an inane request for an example which is obviously completely arbitrary in standards. I have already provided the only example you need. I'm not sure why you continue to hold that my first-hand example is unsatisfactory.
Your requirement of an existing example in a city is ludicrous. You fail to acknowledge the merit in our arguments, and instead of replying with any sort of logical rebuttal you make an inane request for an example which is obviously completely arbitrary in standards. I have already provided the only example you need. I'm not sure why you continue to hold that my first-hand example is unsatisfactory.
When I first thought thought about how roads could be run in a free market I first thought about roads like the ones around where I live. I could envisage a bunch of problems ABCD and E with no easy solution. Now, not all types of road are the same and indeed in some classes (at a wild guess < 10%) of roads, many of the problems A-E reduce or disappear. I suspect that it is no coincidence that the types of private road that exist around the world rather neatly match the ones with the fewest of the problems A-E that I was worried about. This is evidence (not conclusive I agree) that the problems I envisage are real and not imagined. The private roads you put forward are a special category of road with unusually few residents and so the problem of organizing the owners to agree on payment/maintainence are dramatically reduced compared to the bulk of roads around the world.
The free market wouldn't make a polka-dot-colored expressway to the moon. I guess that means that the free market fails. Lol.
Mickanomics,
What about large malls? They don't just have few tenants but several tenants and large traffic. They seem to handle it well without the state.
Also what about large HOA communities? Some communiteis in colorado with 200 homes, all privately built and maintained. Even privately snow-plowed in the winter. :)
Those private communities tend to get their snow plowed first and the people in the inner city are stuck waiting half a day for service to dwindle down to them. So there is yet another example of how privately owned roads are actually functioning better.
filc: Large retail areas such as Mall's already privately control the means to keep their property clean. So ask your question to yourself if you think it's so hard to accomplish how is it that Mall of America can keep a tidy parking lot every day?
Large retail areas such as Mall's already privately control the means to keep their property clean. So ask your question to yourself if you think it's so hard to accomplish how is it that Mall of America can keep a tidy parking lot every day?
That's an easy one. The mall is a common landlord and that single landlord can include the cost of cleaning in his contract. There are no problems of getting separate parties to agree. A mall is not at all like the "market" I was talking about originally.
filc: Also, in this scenario of yours you forget that the road is owned by someone privately. What economic insentive does a private road owner have to let his road become trashy?
To save on the cost of cleaning it.
filc: You have to be consistent to have any moral integrity. If socialized cleaning is better for mankind then the socialized distribution of banana's must also equally be better.
You have to be consistent to have any moral integrity. If socialized cleaning is better for mankind then the socialized distribution of banana's must also equally be better.
That's an excellent point and I do not have a ready made answer. But thinking out loud... it seems to me that its all about whether cooperation is required. If person or company X sells a non-essential product Y to a third party Z, no cooperation between X and Z is required. They could even hate each other personally but the trade could still go ahead unhindered. But organizing the transportation of water, through pipes around a city requires massive cooperation between many many parties and non-cooperation by a tiny fraction could screw the whole process.
filc:What about large malls? They don't just have few tenants but several tenants and large traffic. They seem to handle it well without the state.
Its the number of landlords that count. If its only one landlord then they can put the costs of cleaning in their contracts so that they know that the tenants agree before they even move in.
filc: Also what about large HOA communities? Some communiteis in colorado with 200 homes, all privately built and maintained. Even privately snow-plowed in the winter. :)
I suspect that the maintenance costs are already spelled out in contracts before the tenants even move in.
mickanomics: filc:Large retail areas such as Mall's already privately control the means to keep their property clean. So ask your question to yourself if you think it's so hard to accomplish how is it that Mall of America can keep a tidy parking lot every day? That's an easy one. The mall is a common landlord and that single landlord can include the cost of cleaning in his contract. There are no problems of getting separate parties to agree. A mall is not at all like the "market" I was talking about originally.
filc:Large retail areas such as Mall's already privately control the means to keep their property clean. So ask your question to yourself if you think it's so hard to accomplish how is it that Mall of America can keep a tidy parking lot every day?
Malls are owned by corporations which are own by dozens and sometimes thousands of people. How could it be possible for people to come together in a corporation to build a mall, if they can't come together to sweep a dusty road? Lol.
mickanomics: filc:Also, in this scenario of yours you forget that the road is owned by someone privately. What economic insentive does a private road owner have to let his road become trashy? To save on the cost of cleaning it.
filc:Also, in this scenario of yours you forget that the road is owned by someone privately. What economic insentive does a private road owner have to let his road become trashy?
I guess that means that you wouldn't mind driving of trashy roads. No wonder you favor government roads. Lol.
mickanomics: filc: Also, in this scenario of yours you forget that the road is owned by someone privately. What economic insentive does a private road owner have to let his road become trashy? To save on the cost of cleaning it.
If the company is in the business of selling roads keeping an untidy road seems like a recipe for lost business, wouldn't you agree?
Also lets say that in the extremely rare case that there are seperate owners and some are unwilling to contract to the road owner, or unwilling to cooperate with other surrounding business's there are several factors still in play.
A) The surrounding store owners could still decide that its worth the investment to clean the road anyways even if not all retail owners agree to pitch in.
B) The owners who DO decide to get the road cleaned could have everything cleaned around the retail shops who don't participate.
C) The retail shops could purchase the road, manage it and setup a contractual fee with other retail shops to clean around their shop.
Second point, these situations where there is no prior agreement to clean the road or there is no specific road owner is only the result of prior government presence were the ground was publicly owned before. Had the government never been there in the first place this wouldn't have been an issue. So for all future private developments these issues will be hashed out during development of the property.
The free market is one of discovery and innovation. It finds innovative ways of solving these problems. We can only speculate what the open-market will do to handle these problems, it could be everything I've stated is the opposite of what would happen. It could be that we havn't even though of or are incapable of fathoming what would happen in a private situation.
The point though is that as long as the government manages it we will always have sub-par service. We will also always manage roads at an economic loss as government has consistently shown that it's incapable of managing a road system within a fiscal budget.
As long as government manages it there is no free-market discovery of the most effecient means solving these problems.