I have a question to ask. Is privatization of everything reallygood? For example, if say we privatized scientific research. Then isn't it true that many scientific discoveries would not have been made since there are many scientific research that are not really profitable but are being carried out for the sake of human knowledge. There are many other things that may not be profitable but are a necessity for betterment of human life.
Wouldn't it be better to have such things be done in fifty years, then do them now when they are not marketable? You yourself are arguing against expensive unprofitable research, since you admit they don't have any immediate benefit. Capital generation is more important, so that discoveries are timed when they can be mass produced at low cost and sold at low prices to consumers who can afford them.
As it is, drug companies spend billions on research that takes a decade or two, and there are already mechanisms for evaluating returns far ahead in the future.
Do note that an oil well can take twenty years to break even on original exploration costs and all else, and oil companies still do it.
Not everything that is beneficial to us can be accounted in material terms. For example, Let's talk about parks. I am sure we do not want to pay a fee to visit a park but having a park nearby us is definitely going to be beneficial to us since we do need a break from our work sometimes. Why would someone actually construct a park using his/her own money near our office since it is not going to be profitable as no one would pay to visit that park. Yes it would be beneficial to have a park but privately no one is going to construct that park because it is not going to generate profit for them.
A bit about parks. "Profitable" in monetary terms does not nessecarily mean "profitable" in absolute terms of means and ends. People can and will build parks because they want them. Someone building a residential area knows that people enjoy parks, so they are likely to include them in thier plans. Likewise, neighbors in an area may decide to buy an unused parcel, or aquire an abandoned one, and turn it into a park. I've actually seen this happen personally. In my job, I'm occasionally going into severely depressed areas like North Philadelphia where there are loads of abandoned properties. The houses collapsed years ago, they're just vacant parcels with a bit of topsoil and grass on top of the brick and debris that filled in the old rowhome basements. In many areas, people have gotten together and made little community gardens and parks in an attempt to spruce up some of the nieghborhoods. Many are actually very nice. You can do a lot with some volunteered time and a bit of material.
The saddest part is that they city doesn't know about these. So they go ahead and plan to build Section-8 housing units on all the "abandoned" lots. They come and demolish these things and build more el-cheapo housing that will be trashed in a few years. The city sees them as "abandoned" on thier maps and just plows ahead. They use eminent domain to claim the old titles from the abandonded, absent, or deceased owners, and claim right over said land, despite the fact that a group of people have clearly homesteaded the property.
To me this is a clear example of how state beuracracy confounds the voluntary efforts of some of the poorest people in the nation to better thier lives.
http://www.youtube.com/watch?v=C_PVI6V6o-4
There is no such thing as a publicly owned thing. Public ownership is a contradiction in terms used as an effective talking strategy.
State-owned enterprises are owned by the state, a separate legal entity. On a day to day basis, the general public does not make decisions on production techniques, distribution channels, retail outlets, prices, level of service to be offered, and so on. A state-owned enterprises has only the difference in incentives and constraints, and otherwise its appointed staff attempt to mimick other private enterprises as closely as possible.
There is a giant universe of things that are necessary for betterment of human life but are not profitable. The reason we don't do them is that we pay a cost in terms of giving up other goods and services in order to promote them. Chris Christie of New Jersey scrapped a proposed plan to build a train running from New York to New Jersey. Would it have benefitted somebody? Sure! Would it have been cost effective? No. To invest money in a venture that will give less returns back from train tickets would be to create a deficit of wealth. That loss of money would be borne by even more public school teachers being laid off, even more garbage bins disappearing, and even more roads left undeveloped. Or else, they would have to hike tax rates, in order to bring more funding to a loss-making venture, and taking them away from other useful ventures. It's a deadweight loss in terms of all useful services provided.
Thanks for your answer. I did managed to get some enlightenment from your post.
I do understand where you are coming from. But say everything is being privatized. Would we have sent someone to the moon? Would we even have the internet? Because if say I am an entrepreuner, I would think twice about sending someone to the moon. The price of sending someone to the moon is exhorbitant. But you really cannot argue that sending a man to a moon indirectly led to many other technological advancement. But sending someone to the moon will most likely bankrupt me. So what will be my incentive as an entrepeunuer to send someone to the moon. Creating the internet may require a huge capital and from a capitalist point of view, I am not even sure whether the internet would benefit the public in such a way that i can profit from creating the internet. Why would I spend a huge chunk of my forture to invest in a technology that the public may not accept. From what I read, the internet was already around in the 1970s but it only started to make headway around 1995. As an Entrepreneur, can i actually afford to wait for such a long time with the possibility that it may be a failure? Another thing that we need to think about is this. If say that a particular project does indeed benefit the public as a whole but needs say 50 years before it can come into futility. Would you be willing to undertake that particular project? Would you be willing to take the risk?
ok I will watch the video
Either you'd pay to send someone to the moon, or you'd have better things to spend your money on. Either way, you win.
What do you think about particle physics research then. Do you think we should not do research on particle physics because it is not profitable?
Who is 'we' and how do you magically know whether or not particle physics is profitable? There hasn't been an unsubsidized market in technology and science for a century.
Yes, privatize everything. The government is useless; they pay people to do nothing. Look at String Theory. I am pretty sure we could do without those worthless scribblers.
Terence Kealey is excellent on this point: http://www.youtube.com/watch?v=C_PVI6V6o-4
What did this "sending people to Moon" accomplish? Almost nothing. It was waste of money. STOLEN MONEY. If someone wants to get to the Moon, then better he starts opening his own wallet, not stealing from other people (through taxes).
So again, what did this accomplish? Just because some people get amazed by the idea of sending people to Moon, it is really not sufficient justification for a crime (stealing).
(english is not my native language, sorry for grammar.)
sylar: What do you think about particle physics research then. Do you think we should not do research on particle physics because it is not profitable?
there are no shoulds. It's all subjective in that matter. The question should be: is it ok to forceably take money from people to fund some "oh f***ing amazing" physics research?
I think particle physics is AWESOME. But so fucking what? It is still a crime to use force to extract money from people and it is immoral to use stolen money to fund such research no matter how amazing it it.
Just one more stupid question.
Not everything that is beneficial to us can be accounted in material terms. For example, Let's talk about parks. I am sure we do not want to pay a fee to visit a park but having a park nearby us is definitely going to be beneficial to us since we do need a break from our work sometimes. Why would someone actually construct a park using his/her own money near our office since it is not going to be profitable as no one would pay to visit that park. Yes it would be beneficial to have a park but privately no one is going to construct that park because it is not going to generate profit for them. On the other hand, your local mayor may veto to have that park construcuted so as to win your vote. what do you think about this? How about old aged homes as well as homes for the disabled. Is it actually profitable to build those? How about homes for orphans? Is it profitable to build those? The general public would want the elderly and the orphans to be well taken care of. They would want a park near their house and offices and yet they are not willing to take money directl out of their pockets to pay for them. How would you explain that.
"I am sure we do not want to pay a fee to visit a park"
You already do.
In any case, if people want something, there's opportunity for monetary profit in providing this and therefore possibility of its provision to these people. Nobody claims that the free market is a Utopia or that everybody receives everything they want, but rather that it's the most efficient system for the allocation of goods, and therefore results in the most prosperous condition.
You may as well be asking 'If I don't take everything that everyone in the world owns, won't I have less right now than if I did?" Yes, you would - but you'd also become Robinson Crusoe. Do I really need to explain why this wouldn't help you?
You can have public goods in a free market buy having the community/block/street own shares in a corporation that owns the park. They could put a gate on and charge fees to earn some profit (insert evil cackle here) but I think most people (as you said) don't want to have to charge a fee or take a key every time they want to go for a walk so they would probably keep it open to all and suffer a minor loss (which would most likely be made up for in an increase in property value).The free rider problem isn’t so much of issue when you are talking about local things as you deal with it through social pressure and the lost revenue isn’t to much for people to bare. I also imagine the shares in the park would be attached to property, not necessarily by definition but you would most likely give up the ownership of it as you move away, and if I were in that situation I would give it to the person I just sold my house to. The same thing could be done with certain rivers, roads and other "public" goods where privatisation may cumbersome. As for homes for orphans and old people I would suggest charity, not just through organisations but through families (for old people, obviously that doesn't apply to orphans). Cradle to grave welfare statism has eroded family bonds and responsibilities, as well as those of the community.
Great videos on these topics: http://www.youtube.com/user/fringeelements#p/c/5888B138B9A980DB
(can't get it to link just copy and paste)
sorry for the rambly post hope I helped
The word "beneficial" is also ambiguous. To some people it is beneficial, some do not care about parks at all. So if some people would benefit, then they should make their own park and pay for it collectively and then give it away for everybody to enjoy for example. We are too, how to say it in english... it's like a habit for us to get everything "for free" (even though state use our own money). But still, we imagine, that it is ok to make some "little evil" if the net benefit would be greater. But that faces calculation and moral problems and all comes back to privatization in your OP. Benefit is not sufficient justification either.
I am not saying there can not be "collectively owned" public parks, even though collective property is very very ambiguous term, I'm just saying, that just because we have them now, it doesn't mean they were aquired legitimately and that their benefit is so big that we couldn't live without them.
Sylar, did you read Economics In One Lesson (by Henry Hazlitt)? If not, I highly suggest to take a look and try to read it in your spare time.
http://www.hacer.org/pdf/Hazlitt00.pdf
The font is very big, so it look like a long book, but it's not, very easy to read.