Matt Zwolinski – Bleeding Heart Libertarians http://bleedingheartlibertarians.com Free Markets and Social Justice Wed, 15 Nov 2017 17:16:21 +0000 en-US hourly 1 https://wordpress.org/?v=4.8.3 http://bleedingheartlibertarians.com/wp-content/uploads/2016/09/cropped-site-icon-BHL-32x32.png Matt Zwolinski – Bleeding Heart Libertarians http://bleedingheartlibertarians.com 32 32 22756168 Two Short Points in Defense of Price Gouging http://bleedingheartlibertarians.com/2017/09/two-short-points-defense-price-gouging/ http://bleedingheartlibertarians.com/2017/09/two-short-points-defense-price-gouging/#comments Tue, 12 Sep 2017 23:27:06 +0000 http://bleedingheartlibertarians.com/?p=12023 Over at the New York Times, Andrew Sorkin has a rather incredulous piece on hurricane price gouging. The piece mentions some of my work on the topic, as well as...

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Over at the New York Times, Andrew Sorkin has a rather incredulous piece on hurricane price gouging. The piece mentions some of my work on the topic, as well as pieces by Michael Giberson and Tyler Cowen. It’s a fair and accurate summary of our views, but the overarching tone of the piece is basically “look at the crazy stuff these economists believe!”

I understand the negative reaction that most people have to price gouging, and to the academics who defend it. The suffering caused by disasters like Hurricanes Harvey and Irma is immense. And sometimes those of us who write about price gouging can seem insensitive to that.

Still, as unpopular and unattractive as it may be, I think the pro-gouging position is the correct one. My reasons for that conclusion are developed in some detail in my paper on the topic. But if that’s a bit too TLDR for you, here are two points that I think are essential to bear in mind for any intelligent discussion of this topic. (If these are still too long, I have a short video on the topic too.)

  • Price Gouging Doesn’t Cause Scarcity; Disasters Do. In the aftermath of a natural disaster, there often aren’t enough vital resources to go around. Disasters destroy existing supplies of goods like drinkable water and electric power, and increase demand for substitutes. As a result, no matter what we do, some people’s needs are going to go unmet. In extreme cases, the results of this scarcity can be tragic. But it would be a mistake to blame unmet needs on price gouging. Disasters cause scarcity; and scarcity means that resources have to be rationed. Whether we do that by price increases, or waiting in line, or through a random lottery, some people’s needs are going to go unmet.

 

  • The Real Question is Which Method of Rationing is Least Bad. What most people call “price gouging” is really just one way of rationing scarce resources. A more accurate description would be rationing according to willingness-to-pay. When too many people want something, and there’s not enough to go around, one way to bring supply and demand into balance is to allow prices to increase. That’s not the only way of rationing scarce resources. But it does have two advantages. First, it dissuades people who don’t really need the resource from consuming it (call that the demand problem). Second, it encourages people who have an abundance of the resource to bring it to market in order to earn the exceptionally high profit (call that the supply problem). No one is saying that price gouging is a perfect method of rationing. I certainly wouldn’t use it to ration goods among friends or neighbors who I knew well. But in the large and anonymous setting of the marketplace, where knowledge of who really needs what is limited and empathy is in short supply, rationing according to willingness-to-pay is arguably less bad than any of the alternatives at solving both the demand and the supply problems.

In short, those of us who defend price gouging want the same thing that most of us do – we want scarce resources in times of emergency to go to those who need them most. Our claim is that rationing according to willingness-to-pay does, at least in some contexts, a better job of achieving this goal than any alternative mechanism.

Not raising prices and simply allowing those who show up first to buy whatever they wish might seem like a more moral alternative. At least, no one’s going to charge you with “gouging.” But that leads to situations exactly like the one featured (though apparently not understood?) at the top of Sorkin’s article. And that’s no help to whatever desperate people might show up too late.

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William Graham Sumner and “Social Darwinism” http://bleedingheartlibertarians.com/2017/07/william-graham-sumner-social-darwinism/ http://bleedingheartlibertarians.com/2017/07/william-graham-sumner-social-darwinism/#comments Wed, 26 Jul 2017 13:48:24 +0000 http://bleedingheartlibertarians.com/?p=11942 Over at Liberty Fund’s “Liberty Matters” site, I have an essay on the neglected political ideas of William Graham Sumner. Here’s a bit from the beginning: History has not been...

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Over at Liberty Fund’s “Liberty Matters” site, I have an essay on the neglected political ideas of William Graham Sumner. Here’s a bit from the beginning:

History has not been kind to the legacy of William Graham Sumner. In his time (1840-1910), Sumner was one of the most prestigious and widely read libertarian intellectuals in the United States. Beyond his more technical academic work Sumner also wrote passionately and voluminously in defense of laissez faireon a wide range of social issues. His popular critique of protectionism, “The –ism Which Teaches that Waste Makes Wealth” (1885) and his denunciation of imperialism in “The Conquest of the United States by Spain” (1898) are two of his most impressive polemical works. Sumner’s most sustained investigation of questions of economic policy and distributive justice appeared in a collection essays What Social Classes Owe to Each Other (1883) which includes his most famous single essay – “The Forgotten Man” (1884). Unfortunately, Sumner’s intellectual legacy suffered essentially the same fate as that of his contemporary Herbert Spencer, and for much the same reason. From near-ubiquity and respectability, Sumner’s ideas have descended into obscurity and disrepute. To the extent he is remembered at all today, it is mostly for his alleged “social Darwinism.”

Following my essay is a terrific discussion featuring contributions from David Hart, Robert Leroux, and Fabio Rojas. Be sure to check it out!

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Munger on Social Justice, Safe Spaces and Universal Basic Income http://bleedingheartlibertarians.com/2017/07/munger-social-justice-safe-spaces-universal-basic-income/ http://bleedingheartlibertarians.com/2017/07/munger-social-justice-safe-spaces-universal-basic-income/#comments Sat, 22 Jul 2017 13:52:12 +0000 http://bleedingheartlibertarians.com/?p=11935 Our own Mike Munger speaks with Dave Rubin this week about a number of issues, including social justice, safe spaces on campus, and the case for a Universal Basic Income....

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Our own Mike Munger speaks with Dave Rubin this week about a number of issues, including social justice, safe spaces on campus, and the case for a Universal Basic Income. The interview comes in three parts. Here’s my favorite:

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CFP: Palgrave Studies in Classical Liberalism http://bleedingheartlibertarians.com/2017/06/cfp-palgrave-studies-classical-liberalism/ http://bleedingheartlibertarians.com/2017/06/cfp-palgrave-studies-classical-liberalism/#comments Tue, 13 Jun 2017 23:06:13 +0000 http://bleedingheartlibertarians.com/?p=11861 Readers of this blog might be interested in a new series, published by Palgrave and edited by David Hardwick and Leslie Marsh: Palgrave Studies in Classical Liberalism. Here’s a description from...

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Readers of this blog might be interested in a new series, published by Palgrave and edited by David Hardwick and Leslie Marsh: Palgrave Studies in Classical Liberalism.

Here’s a description from the publisher’s website:

This series offers a forum to writers concerned that the central presuppositions of the liberal tradition have been severely corroded, neglected, or misappropriated by overly rationalistic and constructivist approaches.

The hardest-won achievement of the liberal tradition has been the wrestling of epistemic independence from overwhelming concentrations of power, monopolies and capricious zealotries. The very precondition of knowledge is the exploitation of the epistemic virtues accorded by society’s situated and distributed manifold of spontaneous orders, the DNA of the modern civil condition.

With the confluence of interest in situated and distributed liberalism emanating from the Scottish tradition, Austrian and behavioral economics, non-Cartesian philosophy and moral psychology, the editors are soliciting proposals that speak to this multidisciplinary constituency. Sole or joint authorship submissions are welcome as are edited collections (conference proceedings excluded), broadly theoretical or topical in nature.

If you’re interested in submitting a proposal to the series, please email Leslie Marsh.

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Immigration Debate and New Center at University of San Diego http://bleedingheartlibertarians.com/2017/03/immigration-debate-and-new-center-at-university-of-san-diego/ http://bleedingheartlibertarians.com/2017/03/immigration-debate-and-new-center-at-university-of-san-diego/#comments Wed, 22 Mar 2017 13:11:22 +0000 http://bleedingheartlibertarians.com/?p=11681 Last Thursday, the University of San Diego hosted a debate on immigration and human rights, featuring economist and Econlog blogger Bryan Caplan and philosopher Christopher Wellman of Washington University in...

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Last Thursday, the University of San Diego hosted a debate on immigration and human rights, featuring economist and Econlog blogger Bryan Caplan and philosopher Christopher Wellman of Washington University in St. Louis. You can watch a full video of the debate below.

The debate was sponsored by USD’s Center for Ethics, Economics, and Public Policy, a new center (of which I am the founder and director) devoted to promoting research and education about the institutional and moral framework of a free society.

Prior to the event, I spoke about the center’s mission, and the debate, on KPBS’s Midday Edition. You can listen to that interview here.

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Is Money the Root of All Evil? http://bleedingheartlibertarians.com/2017/01/money-root-evil/ http://bleedingheartlibertarians.com/2017/01/money-root-evil/#comments Wed, 25 Jan 2017 11:30:40 +0000 http://bleedingheartlibertarians.com/?p=11532 WalletHub is running a fun little debate on the question: “Is money the root of all evil?” I’ve got a response up, as does Kevin Vallier. (Jeff Moriarty‘s is also...

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WalletHub is running a fun little debate on the question: “Is money the root of all evil?”

I’ve got a response up, as does Kevin Vallier. (Jeff Moriarty‘s is also quite good).

Here’s an excerpt from my piece:

If anything, money actually lessens the evil effects of greed by channeling it away from socially destructive practices, and toward socially productive ones. Money is a medium of exchange – of trade. And in societies without trade, the most common way of getting what you want from someone else is to take it by force. At best, that kind of violence and theft produce a zero-sum game where one person’s gains equal another’s losses. At worst, they produce a negative-sum game, and a Hobbesian society in which the life of man is “solitary, poor, nasty, brutish, and short.”

But trade is different. When you trade with someone else – whether through barter or money – the only way to get what you want from them is to offer something that they want more. Trade is therefore only possible when both parties value what they receive more than what they give up. And in this way, the possibility of trade fundamentally changes the social character of greed. What was once a force that led individuals to help themselves at others’ expense now leads them to help themselves by serving others. After all, as Adam Smith noted over two hundred years ago, “It is not from the benevolence of the butcher, the brewer, or the baker, that we expect our dinner, but from their regard to their own interest.”

Money isn’t wealth (if it was, any nation could make itself wealthy simply by printing more of it). But by creating the possibility of mutually beneficial trade, money helps us to create wealth. On the micro scale, wealth is created every time two people walk away from a transaction better off than they were before. On a macro scale, money and trade provide the incentive for the creativity, innovation and growth that has already lifted so much of humanity out of poverty, and continues to do so today.

None of this is to deny that some people do very bad things in pursuit of money. Or that many people value the things that money can buy more highly than they should. But those vices are reflective of deeper flaws in human nature: flaws that pre-existed the invention of money and will remain with us as long as we are human. Money does not alter our human imperfection. But it does both put a limit on the harm that imperfection can cause, and provide us with a way of redirecting it toward the greater human good. That is something to be celebrated, not decried.

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VIDEO: Brennan and Haidt Hayek Lectures http://bleedingheartlibertarians.com/2016/10/video-brennan-haidt-hayek-lectures/ http://bleedingheartlibertarians.com/2016/10/video-brennan-haidt-hayek-lectures/#comments Tue, 25 Oct 2016 13:31:31 +0000 http://bleedingheartlibertarians.com/?p=11267 While things are a little on the slow side at BHL, here are a couple of videos from Duke University’s Hayek Lecture series. Enjoy! First, our own Jason Brennan on...

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While things are a little on the slow side at BHL, here are a couple of videos from Duke University’s Hayek Lecture series. Enjoy!

First, our own Jason Brennan on Markets Without Limits:

 

And, second, here’s Jonathan Haidt on “Two acred and Incompatible Values in American Universities.”

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Boudreaux vs. Konczal on California’s $15 Minimum Wage http://bleedingheartlibertarians.com/2016/09/boudreaux-vs-konczal-californias-15-minimum-wage/ http://bleedingheartlibertarians.com/2016/09/boudreaux-vs-konczal-californias-15-minimum-wage/#comments Fri, 23 Sep 2016 20:00:11 +0000 http://bleedingheartlibertarians.com/?p=11186 Earlier this year, Governor Jerry Brown signed into a law a bill that will raise California’s minimum wage to $15/hr by 2022. I wrote here at the time expressing my concerns about the...

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Earlier this year, Governor Jerry Brown signed into a law a bill that will raise California’s minimum wage to $15/hr by 2022. I wrote here at the time expressing my concerns about the effectiveness of the policy as a poverty-fighting measure. But despite the considerable skepticism of many economists, minimum wage laws are still seen by many as a powerful tool for achieving greater social justice.

To explore these issues further, my newly created center at the University of San Diego – the Center for Ethics, Economics, and Public Policy – hosted a debate on California’s minimum wage law earlier this month. The debaters were Don Boudreaux of George Mason University Economics (and Cafe Hayek!) and Mike Konczal, Fellow at the Roosevelt Institute. You can watch a video of the debate below.

 

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Exploitation at the Stanford Encyclopedia of Philosophy http://bleedingheartlibertarians.com/2016/08/10994/ Thu, 18 Aug 2016 21:02:33 +0000 http://bleedingheartlibertarians.com/?p=10994 The Stanford Encyclopedia of Philosophy has just published a very heavily revised version of my[1] entry on “Exploitation.” In addition to covering relatively recent developments in the literature, the essay now contains an extended...

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The Stanford Encyclopedia of Philosophy has just published a very heavily revised version of my[1] entry on “Exploitation.” In addition to covering relatively recent developments in the literature, the essay now contains an extended treatment of Marx’s theory of exploitation, and several-neo-Marxist accounts.

It also, BHL readers will be happy to know, contains some discussion of various classical liberal theories of exploitation. This includes a short presentation of John Locke’s view as set forth in his Venditio, in which Locke claims (as do many libertarians) that the just price is equivalent to the market price, but also claims (as do many critics of the libertarian view) that it is nevertheless possible for market actors to charge desperate customers an unjustly high price. It’s a a subtle and, I think, fairly compelling view. See Mike Munger here for a somewhat lengthier summary and discussion of it.

The entry also contains a discussion of the 19th century libertarian Thomas Hodgskin’s discussion of exploitation as presented in his essay, The Natural and Artificial Right of Property Contrasted. And a brief presentation of the views of the French Industrialists such as Charles Comte and Jean-Baptiste Say. What both of these views have in common is that they go beyond looking at the ways in which individuals can take unfair advantage of each other in the market place, and talk about how the state can be used as an instrument of exploitation. Highly relevant to today’s concerns about corporate welfare and crony capitalism! Here’s an excerpt:

Even before Marx, then, we see in the 19th century a tight connection between theories of exploitation and theories of class and of class conflict. Marx himself credited the “bourgeois economists” of the French Industrialist school with having pioneered the economic analysis of class struggle (Marx & Engels 1965: 69). For members of that school, the two great classes into which society was divided were productive laborers and unproductive social parasites. The class of productive laborers was understood broadly to encompass not only those who exerted physical labor to create tangible goods and services, but anyone who worked to make goods more useful than they would otherwise be—so laborers, yes, but also entrepreneurs, arbitrageurs, and even capitalists in their role as managers and overseers of investments. The unproductive classes, in contrast, consisted of those who consume value but do not produce it, such as the army, the government, and the state-supported clergy (Raico 1977: 395).

According to Industrialists such as Charles Comte and Jean-Baptiste Say, the unproductive classes are able to maintain themselves by using the coercive power of government to forcibly extract resources from the productive. Taxes and tariffs were the most obvious forms such “plunder” could take, but the same goal could also be achieved by special protections for favored industries including the limited conferral of monopoly power (Say 1964: 146–147).

You can read the whole thing here!

[1] The original entry was written by the late Alan Wertheimer, who brought me on board as a co-author a few years back. This entry involved an almost complete re-write by me, though there are still a few sections that Alan wrote himself. I owe a tremendous debt of gratitude to Alan for shaping my thinking on this topic. But it’s probably safe to say that any errors in the present draft are my responsibility alone.

 

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CNN Op-Ed on Gary Johnson’s Libertarian Campaign http://bleedingheartlibertarians.com/2016/08/cnn-op-ed-on-gary-johnsons-libertarian-campaign/ http://bleedingheartlibertarians.com/2016/08/cnn-op-ed-on-gary-johnsons-libertarian-campaign/#comments Mon, 08 Aug 2016 18:46:52 +0000 http://bleedingheartlibertarians.com/?p=10926 I forgot to post this last week, but I’ve got a short piece on the Johnson/Weld Libertarian campaign at CNN. The basic idea – familiar enough to readers of BHL,...

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I forgot to post this last week, but I’ve got a short piece on the Johnson/Weld Libertarian campaign at CNN. The basic idea – familiar enough to readers of BHL, I imagine – is that it’s a mistake to think of libertarianism as a “right-wing” ideology, and therefore a mistake to think that a successful Libertarian campaign would draw more votes from Trump than from Clinton.

Here’s an excerpt:

First, libertarianism is more than just an economic ideology. It’s a social one. And many Libertarian social positions — an openness to immigration, an embrace of equal rights for gay, lesbian, and transgender persons, a hostility toward the war on drugs and American militarism abroad, and support for women’s reproductive rights — are arguably more progressive than the average Democrat. Libertarians were supporting marriage equality and marijuana legalization, for instance, long before any mainstream politician — Clinton included — would touch those issues.
Second, even on strictly economic issues, Libertarians have a lot to say that should appeal to those on the left. Libertarians have long been sharply critical, for instance, of the ways regulations such as occupational licensing requirements are used to protect the economically powerful at the expense of the poor and marginalized. They’ve fought against subsidies, bailouts, and other forms of “crony capitalism” that benefit the few at the expense of the masses. And — contrary to popular perception — Libertarians have often argued in favor of a well-designed social safety net to protect those who fail to benefit from the economic dynamism of a free economy. Both Milton Friedman and Friedrich Hayek, for instance, supported what many regard as a radically progressive policy — a basic income guarantee. And Gary Johnson has suggested that he is open to the idea as well.

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