Economics Questions

Re: How does the Free-Market protect environmental waste?

Peter — Tue, 23 Oct 2012 12:18:55 GMT

I want to say that there should be a law to stop waste disposal in rivers, agricultural land, places near by socities to provide a sustainable environment for living being.

Re: How does the Free-Market protect environmental waste?

gotlucky — Thu, 02 Aug 2012 16:26:22 GMT

Wheylous had the best (funniest) responses in this thread by far!

Re: How does the Free-Market protect environmental waste?

Autolykos — Thu, 02 Aug 2012 15:49:26 GMT

What definition of "a law" are you using?

Re: How does the Free-Market protect environmental waste?

Lady Saiga — Wed, 01 Aug 2012 21:38:13 GMT

I've been mulling over this, this week, and I think my answer would be a little simpler than the above.

Laws are commodities, just like toothbrushes. They are created when the market for them exists. You get environmental laws when the public is demanding environmental law, and not before.

Thus, the free market (via customer choice, private companies which research the habits of other companies and offer certification, investigative reporting, etc) can just as easily do the same thing and naturally WOULD, at exactly the time that the public was demanding change.

Look at the car manufacturers. They aren't doing major market research for nothing. They know, and implement developments that will affect their products and advertising, long before the laws get enacted. It's due to the market demand first and foremost.

Re: How does the Free-Market protect environmental waste?

Autolykos — Tue, 31 Jul 2012 19:03:19 GMT

That post is spam and should be deleted.

Re: How does the Free-Market protect environmental waste?

Phi est aureum — Mon, 30 Jul 2012 14:33:21 GMT

@Peter

What makes you think pollution is better kept in check by the State (and "strict" laws) than by strict respect for property rights?

Re: How does the Free-Market protect environmental waste?

Peter — Mon, 30 Jul 2012 11:59:22 GMT

To stop industrial pollution there is need of strict laws.

_______________

waste control

Re: How does the Free-Market protect environmental waste?

Neodoxy — Wed, 26 Oct 2011 03:27:53 GMT

"Everybody, thanks for posting your responses. I think they are awesome. If you must know, I did not propose this question, my cousin did. I answered him almost as appropriately as you guys have, but I just wanted to amuse myself and see how everyone else would respond. I agree that this is more a failure of government than the free market, if you would define it as a failure at all."

The essence of Austrian Economics is human action, when thinking of these sorts of things you can simply ask yourself "who benefits and gains from this issue? How would each party act without a government?" The fact that most people see these things as a problem, but believe that democracy can solve the problem means that according to their own assumptions the majority of people have to want something, so why would they not act to correct it in the free society?

According to the statist mindset it would seem that there was only one mode of collective action: Actions through government. As if charities and a million other organisations didn't exist even with the overwhelming majority of collective efforts being funnelled towards the manipulation of the government apparatus. Get rid of government and you will see an increase in the social demand to solve problems, leading to an increase in the amount of social entrepreneurship dedicated to solving these problems.

Re: How does the Free-Market protect environmental waste?

John James — Wed, 26 Oct 2011 00:37:49 GMT

See here and here.

Re: How does the Free-Market protect environmental waste?

Autolykos — Wed, 26 Oct 2011 00:31:48 GMT

Indeed. Oil companies don't want oil spills. But at the same time, they'll be happy to let others pay for them when they do occur.

Re: How does the Free-Market protect environmental waste?

Wheylous — Wed, 26 Oct 2011 00:07:30 GMT

Interesting point: Standard Oil, the mythical "big baddie" of the "laissez faire" capitalism at the turn of the century was actually quite environmentally-friendly. They rose from a hectic market which only made use of some of the products made from petrolium and were able to extract many other useful materials from the raw good than the smaller competitors. They sought to minimize waste (and hence costs), and whenever there were leaks in their barrels here and there they rushed to fix them (lost revenue) and called independent agents to verify their work. Environmentalism + self-regulation.

Just more evidence that antitrust policies hurt environmentalism.

Re: How does the Free-Market protect environmental waste?

Bert — Tue, 25 Oct 2011 23:55:15 GMT

This reminds me of a documentary I watched on Netflix called Water (I think that's the name...). Anyway, the documentary talks about 3rd world countries and what's happening to their water supply, and even though I had some problems with the documentary there was one example that couldn't be more perfect. The documentary shows how private businesses and corporations, even foreign to those countries, get control of the water, delay very beneficial projects, and charge them more for the water compared to their local governments. It does show a reality of what's happening, but it'll make the layman assume that's that, and in reality there's no way that could happen without those governments being paid off and letting it happen for their own benefit, and that those people do not really own their own resources. Now, there was one part of the film where Nestle got some contracts to pump water from a local reservoir to sell (this was in Michigan I think), and what happened to those neighboring those streams that benefited from those streams? The water stopped. The townspeople took Nestle to court and that they wanted them out and to stop pumping the water (they are pumping the water, paying no one to do so, and selling it - to them they are profiting from their resources, but of course it's the local government who owns the lake). What happened was sort of unbelievable and believable at the same time, after weeks (or months) and taking them to court at first they were not allowed to pump, then the local court decided they can pump, and were allowed to pump through the trial, and continue to pump. All the townspeople who used those rivers wanted Nestle out, and their local government said otherwise. This is the most blunt example that those governments will be lobbied or bribed to pay into outside interests, so even when the local government had ownership (and the government suppose to represent it's people) they literally sold those interests down a river that dried up. The townspeople got nothing.

Re: How does the Free-Market protect environmental waste?

Vladimir Ulyanov — Tue, 25 Oct 2011 23:53:12 GMT

Well of course, this environmental destruction is occuring under our current system which is failing the environment.

Since preceding comment have laboured the point of property rights, I will switch tack. Economic growth is another solution.

Firstly, more growth means more efficiency and less waste per unit of output. Secondly, economic protection is an economic good. Poor people in, lets say, Africa have little if any involvement in environmental protection because they simply can't afford to. They are more concerned with goods higher on their value scale, i.e. food, shelter, etc.. The reason we can devote time and money to environmental protection is because we have satisfied all our higher valued goals on our value scale. Thus, only because of our greater productivity can we devote our own resources to help the environment.

Re: How does the Free-Market protect environmental waste?

Sphairon — Tue, 25 Oct 2011 23:33:11 GMT

What constitutes exploitation of workers in your view?

As for river pollution, the free market is a socioeconomic system based on property rights. All the individuals and businesses that are located near a river and have been using it as a source of clean, fresh water have acquired a property stake in the (clean-ness of the) river. One single actor can't just start polluting the entire system as it would violate the property rights of all the other users.

The fact that Alberta has these problems indicates that property rights are not clearly defined or not defended by the courts. It has become a mixed economy, and dirty wastelands are the result.

Re: How does the Free-Market protect environmental waste?

EmperorNero — Tue, 25 Oct 2011 23:30:52 GMT

matthewloewen:
In terms of externalities, how can the free market stop a company from exploiting its workers overseas, or dumping toxic waste into a river? In Alberta we have a huge problem with the tar sands. Vast sections of that province have been stripped, water dirtied etc, with little effort on part of the companies working there to clean up their mess. Yet, as a consumer, I should stand up against this. But I don't, and I am a person who knows about this problem. Is that not a failure in the free market?

If everything is owned by someone, there are no externalities. You dump waste into a lake, the owner is going to sue you. You dump toxic waste anywhere, and somebody is going to complain about it. Pollution as such only exists where property rights don't. It is not a failure of the free market, but lack of it.

The free market stops companies from exploiting it's workers overseas the same way it does at home: through competition. Employers have to compete for labor and employers that treat their employees nicely will have to pay them less. Better conditions are simply a way to pay workers, and pay is a function of productivity. Therefore, conditions get better when workers get more productive. (Also because all the stuff we produce means we can afford the luxury.) The reason developing countries have such horrible working conditions is that they lived under socialism for a longer time than the west, which means they couldn't develop their economies, which means that they are less productive.