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
Caley McKibbin: mickanomics:If there is great demand in LA for better water then presumably some businessmen have been badgering the authorities asking to be allowed to set up a rival water system. You are joking, right?
mickanomics:If there is great demand in LA for better water then presumably some businessmen have been badgering the authorities asking to be allowed to set up a rival water system.
You are joking, right?
They have and failed. Hence the reason we have delivered water services now. City's won't allow more then one pipe main from being installed under the city. This is why cable company's have monopoly' as well. City's only allow a single cable network dropped as well.
On a side note I can't remember who posted it, perhaps fee.org. But there was recently a discussion about a local government's public water system falling to shambles and them contracting it out to a private water service company. They came in and pretty much saved the day. When I can find the article I'll post it.
To state that water wouldn't get delivered to people's homes without the state is entirely silly. Third world countries in much worse conditions than us currently do it privately in this manner already. How is it that a third world country can do it but we cannot?
filc:They have and failed.
Do you have a reference for this?
mickanomics: filc:They have and failed. Do you have a reference for this?
Quiet frankly is a reference needed? This is rather elementary. You brought up the argument, not me. Your trying to prove that it's unprofitable for a private company to provide water. Such a claim seems awfully naive.
filc:They have and failed. Hence the reason we have delivered water services now. City's won't allow more then one pipe main from being installed under the city. This is why cable company's have monopoly' as well. City's only allow a single cable network dropped as well. On a side note I can't remember who posted it, perhaps fee.org. But there was recently a discussion about a local government's public water system falling to shambles and them contracting it out to a private water service company. They came in and pretty much saved the day. When I can find the article I'll post it. To state that water wouldn't get delivered to people's homes without the state is entirely silly. Third world countries in much worse conditions than us currently do it privately in this manner already. How is it that a third world country can do it but we cannot?
What, you've never seen Chinatown?
filc:Quiet frankly is a reference needed?
Yes.
filc:Your trying to prove that it's unprofitable for a private company to provide water.
No I'm not. I'm just suggesting that its rather impractical to have two sets of mains running down one street. I suspect instances of this are rare as hens teeth. Now this could be one of the following reasons:
A. Private companies are keen to add secondary pipes but are barred from doing so by the government.
B. Private companies are not keen to add secondary pipes.
I suspect A. If the case is B, then you would expect to see the occasional newspaper article saying "water company asks to build secondary pipes but were barred".
mickanomics: I'm just suggesting that its rather impractical to have two sets of mains running down one street.
Is it impractical to have two types of milk at the grocery store?
mickanomics:I suspect instances of this are rare as hens teeth.
Well ofcoarse. How many opportunities does the private market get to explore this sector?
mickanomics:A. Private companies are keen to add secondary pipes but are barred from doing so by the government.
This is correct
mickanomics:B. Private companies are not keen to add secondary pipes.
This is the only unsubstantiated thing stated. Though you seem to be taking this as fact, and ignoring A despite the fact that A is the most empirically and obviously observed fact on the table.
mickanomics:I suspect A. If the case is B, then you would expect to see the occasional newspaper article saying "water company asks to build secondary pipes but were barred".
Why would you expect to see this in the newspaper? Private business's requests for licenses's on a daily basis. Working directly with civil engineers and service providers I see this on a day to day basis. What, you want the newspaper to publish every single time someone asks something of the government?
filc: mickanomics: I'm just suggesting that its rather impractical to have two sets of mains running down one street. Is it impractical to have two types of milk at the grocery store?
By the way, it's worth pointing out the following. That such discussions over whether it is, or is not, practical to do such things is entirely business speculation. We cannot and will not know the cheapest most efficient way of providing water under the condition of a coercive monopoly.
Still, it is not the job of economists to decide what is the most efficient way of doing things. Those types of speculations are confined to entrepreneurs and businessmen alike. Pretending to know how things SHOULD be is pretending to be omniscient. Something I doubt you are.
filc:Is it impractical to have two types of milk at the grocery store?
No, they are entirely different cases, for reasons discussed at length earlier in this thread.
filc:Pretending to know how things SHOULD be is pretending to be omniscient.
Hang on a second... it seems that my suggesting that B is true is due to my idiotic pretence to be omniscient, yet your assertion that A is true is somehow your genius expertise?
filc:despite the fact that A is the most empirically and obviously observed fact
Tell me more details about your "observations" of this fact.
mickanomics: If there is great demand in LA for better water then presumably some businessmen have been badgering the authorities asking to be allowed to set up a rival water system. In order to help their case and get political pressure I presume they would also be going to the press. So presumably you can give me a link to some articles about these businessmen.
If there is great demand in LA for better water then presumably some businessmen have been badgering the authorities asking to be allowed to set up a rival water system. In order to help their case and get political pressure I presume they would also be going to the press. So presumably you can give me a link to some articles about these businessmen.
If you are right, then presumably someone would cite this response in a book or article somewhere. So presumably you can give me a link to the books where your response is cited.
"If we wish to preserve a free society, it is essential that we recognize that the desirability of a particular object is not sufficient justification for the use of coercion."
I here by confess that I am not well read enough to know about such a citation. Or even if it exists. I am not pretending to know of such a citation. But filc has stated that "A" was "observed"... so I want to know about his "observation".
mickanomics:Hang on a second... it seems that my suggesting that B is true is due to my idiotic pretence to be omniscient, yet your assertion that A is true is somehow your genius expertise?
The point he's making is that government monopoly forces a set business model upon everyone, regardless of whether a more viable option exists. The private sector is demonstrably more efficient and effective, whether or not it involves the exploration of alternatives.
In any case, this is ridiculous. I went on a two-week vacation and this "debate" is still going on, and it's just because of your (mickanomics) willful ignorance. There are many, many counter-examples provided by other posters in this thread, and you just need to spend ten to fifteen minutes looking at some of their posts to see not only rationale for private roads and utilities, but examples inasmuch as private businesses are allowed to operate in such industries.
Life and reality are neither logical nor illogical; they are simply given. But logic is the only tool available to man for the comprehension of both.—Ludwig von Mises
Life and reality are neither logical nor illogical; they are simply given. But logic is the only tool available to man for the comprehension of both.
mickanomics:I here by confess that I am not well read enough to know about such a citation. Or even if it exists. I am not pretending to know of such a citation. But filc has stated that "A" was "observed"... so I want to know about his "observation".
So until you can put forth such a citation, I'm going to have to ask you to shut up. Either way, there's a huge water crises in CA, where farmers are put out of business because the government finds tiny fish more important than the economy (41.5% unemployment).
Esuric:So until you can put forth such a citation, I'm going to have to ask you to shut up.
So filc can assert something without a citation and his comments are valid, while if I assert something without citation and I'm supposed to "shut up". Why the asymmetry?
mickanomics:So filc can assert something without a citation and his comments are valid, while if I assert something without citation and I'm supposed to "shut up". Why the asymmetry?
Okay, fine, both of you shut up.