Those of us who regard socioeconomic inequality as a serious problem are often accused of “envy,” as though such concerns were simply a matter of begrudging someone else’s having more cookies than we do.
I think this reaction misses the point in a number of ways; let me say just a bit about just one of those ways:
Suppose you forget to pay your power bill (or your phone bill, or your cable tv bill, or your internet access bill, or your credit card bill, or whatever). What happens? Your provider disconnects you, and you’ll probably have to pay an extra fee to get service reestablished. You also get a frowny face on your credit report.
On the other hand, suppose that, for whatever reason (internet glitches, downed power lines after a storm, or who knows), you suffer a temporary interruption of service from your provider. Do they offer to reimburse you? Hell no. And there’s no easy way for you to put a frowny face on their credit report.
Now, if you rent your home, take a look at your lease. Did you write it? Of course not. Did you and your landlord write it together? Again, of course not. It was written by your landlord (or by your landlord’s lawyer), and is filled with far more stipulations of your obligations to her than of her obligations to you. It may even contain such ominously sweeping language as “lessee agrees to abide by all such additional instructions and regulations as the lessor may from time to time provide” (which, if taken literally, would be not far shy of a slavery contract). If you’re late in paying your rent, can the landlord assess a punitive fee? You betcha. By contrast, if she’s late in fixing the toilet, can you withhold a portion of the rent? Just try it.
Now think about your relationship with your employer. In theory, you and she are free and equal individuals entering into a contract for mutual benefit. In practice, she most likely orders the hours and minutes of your day in exacting detail. As with the landlord case, the contract is provided by her and is designed to benefit her. She also undertakes to interpret it; and you will find yourself subjected to loads of regulations and directives that you never consented to. And if you try inventing new obligations for her as she does for you, I predict you will be, shall we say, disappointed.
These aren’t merely cases of some people having more stuff than you do. They’re cases in which some people are systematically empowered to dictate the terms on which other people live, work, and trade. And we generally take it for granted. But it’s not obvious that things have to be that way.
When it comes to diagnosis and prescription, those of us who worry about socioeconomic inequality go in two different directions. Some identify the free market as the cause of such inequality, and government regulation as the cure; for others, it’s precisely the other way around. I’m obviously with the latter group; all the phenomena I mentioned are made possible by systematic restrictions on competition. Libertarians need to spend more time focusing on liberty as the solution to these pervasive asymmetries of power, rather than giving the impression that they find them unproblematic.
I don’t see the benefit of thinking in terms of “only market causes socioeconomic inequality” or “only regulation causes socioeconomic inequality”. Isn’t it an instance of epistemic closure to say this issue is not context dependent?
Isn’t it intellectually irresponsible to assume that anyone who treats markets as the problem in one instance or more automatically finds perverse asymmetries of power unproblematic? Say that I believe markets cause asymmetries only in the instance of derivatives markets; in every other instance, government regulation is to blame. Does that necessarily mean I find perverse asymmetries of power unproblematic? Where the hell do you get the idea that there’s only two different directions to go by way of diagnosis and prescription?
Well, it would be weird. But your question is also weird, since it implies that someone in this discussion has made the asusmption you refer to. I distinguished three groups (and note that I never said this division was exhaustive):
a) Those who don’t see the problem.
b) Those who see the problem and blame government.
c) Those who see the problem and blame markets.
My point was that libertarians are too often in group (a) when they should be in group (b). Your reply, in effect, is to ask why people in partial agreement with group (c) are being lumped with group (a). The answer, obviously, is that they’re not. People who offer a diagnosis of a problem are by definition not members of the group that doesn’t see the problem.
Um .. the same place you got the idea that I claimed there are only two directions … ?
I say: “Where the hell do you get the idea that there’s only two different directions to go by way of diagnosis and prescription?”
No, I got that from this:
How else should I interpret that other than “there are two directions to go for those of us who worry about socioeconomic inequality.”? You don’t say that’s exhaustive, but the predicate concept “going in two directions” doesn’t in any way imply “going in two directions or more”.
Well, it’s certainly not exhaustive. You should add: (d) Those who see the problem and blame government and markets. That’s curiously absent. And if you do add that, then the whole two direction thing is entirely too narrow of an approach.
Well, those are the two dominant reactions — the two points along the spectrum where positions cluster (on that issue). I could have talked about still other positions, but since I think one of the two dominant positions is actually correct, it wasn’t relevant to what I was saying.
But you’ll admit it would be more accurate to say, “There are two dominant directions to go.”?
OK. Now I really want to take you to task. I just read Toward a Libertarian Theory of Class here and here. You explicitly describe the Neither-Dominant view — which is obviously what I’m after and I think it clearly holds the most descriptive power. That aside, there’s still a contradiction here.
Actually, you advocate something in between the Neither-Dominant view and the Statocracy-Dominant view. You call it the “Statocracy-Mostly-Dominant” view. Has your position changed to “Statocracy-Only”? ‘Cause that what you’re pointing to here:
Will you acknowledge this inconsistency? It’s really been bothering me for quite some time…
No, my view is still Statocracy-Mostly-Dominant, not Statocracy-Dominant. (The gap between the two is what a lot of the thick-libertarian stuff is about.)
I don’t see an inconsistency, unless abbreviation is a form of inconsistency. I took “blaming the government” to include both Statocracy-Mostly-Dominant and Statocracy-Dominant.
(Moreover, keep in mind that the Statocracy-Mostly-Dominant position doesn’t amount to “blame the government mostly but the market a little bit.” The market always does the best it can with the crooked timber given to it. Cultural perversities that would have harmful results in a free market would have still worse results under government; thus there are pragmatic, and not solely moral, reasons to fight such perversities by nongovernmental means only.)
And seeing corporatism as essential isn’t a Plutocracy-Mostly-Dominant position? I mean, that’s precisely why I figure the Neither-Dominant position holds the most descriptive power. I understand that you’ll say the corporation is an extension of the state. I get that. But the whole point of respecting both the Rouseauvian and Smithian theory of class, I thought, was to acknowledge both that a business organization would build itself through market exchange but then corner off the market through violence: which incidentally takes the form of manipulating the state. If there wasn’t a state, that organization would act as the state. That puts the business and the state on equal footing.
I’ve gone into business with a partner in the past year and would love some resources for drawing up contracts that don’t resort to threats to litigate. Also I will be renting out my house soon and would love to draw up a lease with the tenant. I want to make sure that all the normal range of situations are covered, but in a cooperative, not coercive way. Any ideas where I could find templates with such language? Dig the perspective; it gets at one of the main reasons I got fed up with jobs and bosses and decided to work with my friends without either. But it turns out I’m at a bit of a loss as to how exactly to reinvent the wheel.
It’s not clear to me how government regulations gave my boss more power over me than if there were no regulations. In fact most of the regulations that applied to my workplace were protecting my rights.
One can either say “We need a strong government to break the power monopolies;” which gives a power monopoly to the government, which is then influenced by those with the power and resources to do so–so that no appreciable change in power ensues. Or, one can assume that by somehow freeing the market from those with power and influence, this hypothetical “free market” will level the playing field and keep power evenly distributed. If, by some miracle, we could arrive at such a state, It would surprise me if it took an entire decade to devolve to something akin to what we have now.
The rich get richer. The powerful gain power. The little guys subsist on what the big guys are willing to leave them. Happens either way you slice the pie: “free” market or “free” government.
Check out Kevin Carson’s latest C4SS study, “Labor Struggle: A Free-Market Model, for an account of how labour regulations supposedly aimed at benefiting workers actually do the opposite.
Or one can argue for this instead of assuming it; and one can explain the mechanism rather than saying “somehow.” Maybe the arguments and explanations we’ve offered are crap, but if so, they should be refuted rather than treated as nonexistent.
This is one of your best, Roderick.
BTW, I wonder why people who complain about things like welfare, or the alleged fact that 47% of households pay no income tax, are not guilty of “class envy.” I’m sure they’d respond that their objection in that case was to people benefiting unjustly from state attacks on the productive. Well, I’m waiting to hear the difference….
“On the other hand, suppose that, for whatever reason (internet glitches, downed power lines after a storm, or who knows), you suffer a temporary interruption of service from your provider. Do they offer to reimburse you? Hell no.”
Often they do if you call and ask. I’ve done it several times with cable, phone and internet services.
Ditto here. If you call and complain they do credit your bill a bit.
Paragraphs 4, 5, and 6 add nothing to your argument as they are at odds with reality.
All three arrangements are voluntary contracts. Even in the case of a term lease (12 months vs. month-to-month) the contract is easily broken without penalty in the case you describe.
Para 4: yes, they will discount the service. Just ask them. I’ve done it many times. And, yes you can register your frowny face with BBB with no burden of proof on you.
Para 5: I’ve given you the keys to my $200k investment, praying every night you don’t burn it to the ground, and the power is all on my side? Further, yes, you can deduct fixing the toilet from next month’s rent (although I have a “right” to repair), yes you can break the lease at any time (just complain to the housing authority), and, no, the lease contract cannot even hint at having you relinquish any of the “renter’s rights” enshrined in the housing code and court law.
Para 6: This job entails performing these tasks (as assigned by the night manager) during these hours while dressed appropriately and, from time-to-time, peeing clear with a two-hour notice. In return, we will pay you $X per time period, regardless of your actual marginal productivity and realized revenues during that time period, although you can be sure that this at-will contract will be terminated if your marginal productivity falls below X for any sustained period of time. Take it or leave it.
It’s possible, of course, to be outplayed and end up with a bad contract, whether through incompetence or sheer laziness. I admit, though, I’m at a loss as to how the lazy and incompetent should become their own ISP, landlord, or employer.
How do contracts in an oligopolistic/oligopsonistic (or, in the case of power/cable companies, literally monopolistic) context count as voluntary?
You’re dropping context. You’ve given me the keys and thus given me the power to screw you over. I’ve put all my worldly goods in your housing and thus given you the power to screw me over. Thus far we’re pretty equal. Then comes the contract that’s skewed to your side of this relation.
You obviously live on a different planet from the one in which I and most of the people I know have rented many many times. Try telling your fairytale to all the people who’ve been successfully evicted for withholding rent for unrepaired plumbing etc.
Interesting how critiques of your essay from both left and right are based on the same “package deal” assumptions about the nature of the present system as “just the way things are,” the result of what the market just happened to decide rather than any exercise of state power.
John Elder: I would argue that most regulations of what your employer can do to you are just secondary restraints on the abuse of their unequal bargaining power, which in turn results from primary background conditions created by government.
The main effect of most government policies is to increase entry barriers, minimum capital outlays, and overhead cost of small-scale production, and to reduce the amount of idle land and cheap capital, so as to minimize the number of opportunities that wage employers are forced to compete with for your labor. And by putting a floor under the cost of subsistence, the regulatory framework increases the size of the minimum revenue stream the average household needs just to break even, hence increasing the demand for hours of employment relative to the supply.
Part of the political pressure for Parliamentary Enclosures 200-250 years ago reflected a perception on the part of the employing classes that when free land was competing for workers and they could produce an inordinate share of their subsistence needs working for themselves, their need for paying work was insufficient to force them to be willing to work on acceptably profitable terms for the employing classes.
So government policies raise the cost of living, reduce the amount of competition wage employers face from self-employment, and artificially increase the total number of wage hours that must be worked to subsist. Government policies that regulate the extent to which employers can abuse this state of affairs are just a secondary qualification of a primary state grant of power.
Hmmm. I suspect there’s a C4SS column in this.
If you’re speaking of a “landlord,” why refer to “her” obligations?
He means the landlord’s wife, who really rule.
Like most philosophers, I usually use “she” as the generic pronoun.
So you say that the cause of socio-economic inequality is government regulation and the answer is the market. But in your argument you’re ignoring basic economic though on market failures. There’s hardly dissent amongst economists that if there is one of three circumstances, there is a place for government intervention. These three are:
– imperfect information
– public goods
– externalities
If you consider the cases you mentioned above, they fit the standard textbook model for a market failure in many ways. Take the employee/employer relationship for example. The worker doesn’t have perfect information. They don’t have access to a lawyer to draft contracts. They don’t know exactly what kind of job they’ll be able to get outside of this one. There are other pieces of information they lack that are critical, if you think about it. If markets are the answer, they would supply perfect information about employers so discerning employees would not work for them. But it simply doesn’t. Sometimes the only job you can get is a bad job.
As long as that is the case, there’s a role for government to set minimum standards. If you spend some time thinking about the other types of market failures, you’ll find that they play a role in many of the interactions that we have.
But governments aren’t made of magic. 1) They don’t (and can’t) have perfect information; 2) making sure they do what they’re supposed to do is the mother of all public goods problems; and 3) the whole point of having them, supposedly, is that they can externalize their costs and liabilities, making everyone else pay for them, allowing them to do what mere mutually voluntary actors would or could not do (either because of free rider problems or because it’d just plain be illegal for anyone else to do it, e.g. eminent domain).
You’re obviously not familiar with the Austrian School if you think there’s “hardly dissent” among economists on this. The Austrian position is that to the extent that these problems exist, markets are quite good at solving them, while government suffers from even more debilitating versions of them.
Government’s information is more imperfect than the market’s because it’s insulated from price-system feedback. Incentive problems are worse with government because customers can’t choose alternatives. Government, by imposing costs and extracting revenue by force, is a massive factory of externalities. As for public goods, see here.
First: since perfect information is impossible, blaming the market for not providing it doesn’t make sense.
Second: if perfect information were possible, your “it simply doesn’t” would involve the fallacy that because our unfree market can’t do something, a free market can’t do it either.
Third: if there were more competition in the labour market, forcing employers to compete more vigorously for employees, and if likewise the regulatory barriers to self-employment and workers’ cooperatives were abolished, workers’ prospects would improve without any need for perfect (or even better) information about employers.
Fourth: unregulated information networks are already beginning to lower the price of information about employers.
“– public goods”
Actually, the government is a prime culprit in this, because it turns many goods, that would be not be public goods, into public goods. Furthermore, public goods are not innately problematic, and that assertion is based on the fallacious “tragedy of the commons” concept.
BMB wrote: “Para 4: yes, they will discount the service. Just ask them. I’ve done it many times. And, yes you can register your frowny face with BBB with no burden of proof on you.”
Loss of service has never happened to me so I can’t weight in on the basis of personal experience. The better question is what remedy, if any, the cable company is contractually obligated to provide in the event of loss of service. You can bet your last dollar that the cable company (there’s only one in my area) won’t agree to any remedy if “their” contract doesn’t provide it already. So if it’s not in your agreement and government regulations are silent, then the cable companies might be crediting your account for purposes of good will. Otherwise, you are up the proverbial creek without a paddle.
BMB wrote: “Further, yes, you can deduct fixing the toilet from next month’s rent (although I have a “right” to repair)…”. No you cannot, generally. The obligation to pay is independent of the landlord’s obligation to repair. IOW, the duty to pay in rental agreements is independent of a right to repair; hence, the two duties/rights are referred to as “independent covenants” in rental/lease agreements. If the toilet simply leaks but is otherwise usable, you are S.O.L. You must pay regardless. Or, you might be able to resort to housing code enforcement to fix the toilet but this doesn’t relieve you from the obligation to pay. “Constructive eviction” might be a defense for refusal to pay but the tenant would have to vacate the premises for a legitimate cause (e.g., the pipes to the toilet break flooding the apartment). However, this is a non-contractually judicially created remedy crafted by court’s to mitigate the asymmetrical power relationship between tenants and landlords. IOW, you won’t find it in any rental agreement. The “warranty of habitability” is another court created remedy to offset the landlord’s power contained in the standard rental agreement. In either event, the remedy is raised as a “defense” to the suit the landlord files against you for failing to pay your rent as required.
“Para 6: This job entails performing these tasks (as assigned by the night manager) during these hours while dressed appropriately and, from time-to-time, peeing clear with a two-hour notice. In return, we will pay you $X per time period, regardless of your actual marginal productivity and realized revenues during that time period, although you can be sure that this at-will contract will be terminated if your marginal productivity falls below X for any sustained period of time. Take it or leave it.”
BMS’s analysis and argument are ahistorical. However, it provides some insight into the motivation historically for organizing labor into sufficiently powerful entities to force employers to take or leave it (their labor) without resort to a contract (Wobblies) and through the prudent use of strikes. IOW, we don’t need no stinkin’ contract. For me, this is also another argument for creating organizations and alternative sources of income and other forms of subsistence to ride out a strike.
BMS wrote: “It’s possible, of course, to be outplayed and end up with a bad contract, whether through incompetence or sheer laziness.”
BMS obviously doesn’t understand adhesion contracts nor does BMS demonstrate any historical insight. Perhaps BMS subscribes to the “causeless event theory of history.”
Finally, BMS wrote: “I admit, though, I’m at a loss as to how the lazy and incompetent should become their own ISP, landlord, or employer.”
While this might reveal a defect in BMS’s imagination, it in no way is a persuasive argument that ISP providers, landlords, or employers can’t also be lazy and incompetent. My personal experience as both an employee and employer contradicts BMS’s assertion.
I guess I need to work on my reading comprehension. I read Prof. Long’s post “as things are”. I didn’t know the post referred to feudal Europe ISPs and Roman Empire cable companies. My bad.
@Joe Twelvepack: Thank you for pointing out the disparity in “repair and reduce” laws. Based on an, admittedly non-exhaustive, survey Western states lean towards “repair and reduce” and Eastern states trend “send a letter and quit in 30 days”.
http://www.landlordassociation.org/statelaws.html
My points remain:
1) At-will contracts (in areas/conditions that recognize contracts) are unrelated to Prof. Long’s conclusions in Sep. 2010.
2) Person A cannot, ceteris paribus, be both hapless victim and empowered individual.
How anybody can think that having to provide pee on notice for drug testing is “freedom” is beyond me. (Probably they are the same person who thinks that not giving agricultural workers restroom breaks while working hot 8-hour days in the sun is “freedom”).
One point you don’t raise Roderick is the issue of monopoly (others have pointed out the textbook cases of market failure like externalities). In a free market there is, by definition, competition, which if it means anything means the number of actors supplying a good shrinks to the ones that are most profitable. Once this happens, any new competitors will either not be able to make capitalization requirements, or if they do the monopoly (or oligopoly) can run at a temporary loss to ensure the new competitor is shut down. You say the number of firms in a given market (internet, real estate, etc) will be thousands and tens of thousands; I say, it will be the dozens and hundreds, and in some cases just 2 or 3. And whether a monopoly comes from force (like a state) or is voluntarily established, it still is just as inimical to freedom.
What is freedom?
a) Advancing and acceptance of an offer that includes drug testing as a pre and ongoing condition of employment.
b) Prohibiting such.
What’s that got to do with anything? Both left-libertarians and right-libertarians are opposed to prohibiting contracts that require drug testing. But left-libertarians think that such offensive contracts, while legal, would have a much harder time finding takers in a freed market.
You’re ignoring diseconomies of scale. As firm size grows, the internal coordination of the firm, disconnected from price-system feedback, grows increasingly difficult. Distribution also becomes more expensive (because it needs to cover a wider area). Eventually diseconomies of scale overwhelm economies of scale, placing an upper limit on the firm’s growth (except where government regulation enables the firm to externalise its costs while internalising its profits; see Kevin’s work for details). So it will generally not be profitable for a given market to shrink to a small handful of firms.
How many cases can you name where a cartel has succeeded in doing this without government help?
BMB: Freedom is either A) offering my caged bird some bird seed, or B) prohibiting people from such.
A
A
How is that even a question in your mind?
*slaps forehead
Are you really that dumb that you don’t recognize an obvious satire?
While I agree that a freed market would modify many of the socio-economic relationships described, I think some aspects would not be changed all that dramatically for the simple reason that in most, if not all, of the examples given there is a great disparity in risk between the two parties, and it seems quite natural (to me) that the party with the greatest risk will have to be compensated for that risk in some way. That compensation could be handled several ways, but two obvious ways would be to grant greater relative say in contract terms and/or some kind of insurance or up-front compensation.
Just taking the landlord-tenant situation as an example, the landlord is in a very different position compared to the tenant. It’s far easier for the tenant to gather his/her belongings and skip town (and his/her lease); not so easy for the landlord to gather up the apartment complex and move to another city. That difference in risk would have to be dealt with, even in the most wildly competitive free market you could imagine. And that’s not the only type of risk disparity, just one of the obvious ones. The same could be applied to many employer-employee relationships as well.
Well, that will depend on the details. Suppose a renter is living paycheck to paycheck; skipping town will require renting a truck and coming up with a deposit on rent somewhere else, options that for many renters will be simply impossible. Such a renter is radically dependent on a single landlord. (Likewise, a renter whose credit score has gotten worse may be de facto stuck with their current landlord.) By contrast, a landlord who has many properties is not radically dependent on a single tenant. (In my experience, landlords who own many properties tend to be more draconian than those who own just one; and large companies with properties in multiple states tend to be worst of all. Thus may be anecdotal, but it’s also what one would expect.)
As for skipping town — well, I once rented from one of those multiple-state companies; their offices were in another state, they were very hard to get hold of, and given their rather shady practices (actually we suspected them of Mafia connections) I wouldn’t be surprised if they were simply to vanish if they got into legal trouble.
In any case, left-libertarians advocate not just nicer conditions for renters (and ditto for employees), but removal of the legal obstacles that make it harder for renters to become owners (or for workers to become self-managers). Of course, a world where being a renter or an employee is a less compulsory option will also, via competition, make conditions much nicer for those who do choose to become renters or employees.
This same rental company sent out many inadvertently funny memos (my two favourites were “February 22nd has been postponed indefinitely” and “starting next month one fourth of the residents will be exterminated each week”). A less funny memo was one that announced that any resident who stored anything on her balcony (as we all did) would be fined $50 per day until the stuff was removed. Would this requirement have stood up in court? Maybe not (although our leases did contain one of those elastic clauses about the tenant’s agreeing to abide by all such further regulations as the landlord may impose). But the apartment agency was in a better position to afford a court battle than we were, so we complied.
Just to add one other thing to my previous comment.
It seems that even in a freed market environment, there might be a basic efficiency advantage to those places that use a standardized contract vs. those that customize every single one. In the example of an apartment complex, you’ve potentially got an owner who has to keep in mind 100 different policy provisions from how quickly toilets need to be fixed for these particular tenants, to unique pet policies because one guy wanted a chinchilla clause.. etc. Meanwhile, each tenant only has to keep track of their own contract, and it seems that it would generally increase the amount that tenants have to pay for the owner to be willing to go through such tremendous extra time and effort. I’m sure there are tenants who would be willing to do that, but I’m not one of them, and I’m sure I’m not in some strange minority in that. (Nor should I be, I don’t think.)
Your concept that there is an owner that is not the tenents in a freed market is a contradiction.
A freed market is one wherein an owner is not able to rent to anyone else?
Why would a worker accept to pay a rent to a property owner (that is to say, money in exchange for the “privilege” of using capital that is unused by its owner) when he can acquire or borrow freely-available capital to buy his own?
And why would a free society passively accept that some people make money strictly off others’ position in exchange for no labor whatsoever? The accumulation of wealth in the hands of a privileged class inevitably leads to class warfare, and ultimately statism, as the case of Iceland has demonstrated. The lesson should be learned.
“Why would a worker accept to pay a rent to a property owner (that is to say, money in exchange for the “privilege” of using capital that is unused by its owner) when he can acquire or borrow freely-available capital to buy his own?”
There might be many reasons why different individuals would want to rent something instead of purchase it. (And vice versa.) Is it difficult for you to imagine why renting might be more convenient to a person than a purchase?
“And why would a free society passively accept that some people make money strictly off others’ position in exchange for no labor whatsoever?”
Not sure what kind of resistance you envision. When one person is willing to rent something, and a second person is willing to pay the rent, what do you do to either or both to demonstrate your non-acceptance of their private arrangement?
“The accumulation of wealth in the hands of a privileged class inevitably leads to class warfare, and ultimately statism, as the case of Iceland has demonstrated. The lesson should be learned.”
I doubt the lesson you’re drawing from history, but even were it true, your right to teach it to others (against their will) is even more doubtful.
“There might be many reasons why different individuals would want to rent something instead of purchase it. (And vice versa.) Is it difficult for you to imagine why renting might be more convenient to a person than a purchase?”
How is it more convenient for a person to be subject to the whims of the so-called owner of the building he needs to live? Any supposed function of renting that is positive can be reproduced by other kinds of exchange.
“Not sure what kind of resistance you envision. When one person is willing to rent something, and a second person is willing to pay the rent, what do you do to either or both to demonstrate your non-acceptance of their private arrangement?”
If the person who is “willing to pay rent” (tribute) to someone else, there must be a reason. They must be given opportunities to own their own place of living, and the person who is trying to exploit him should be prosecuted for fraud (asking for money in exchange for no labor).
“I doubt the lesson you’re drawing from history,”
Then read more on the subject of Iceland’s early history, esp. how religious monopoly on certain lands created a privileged class.
“but even were it true, your right to teach it to others (against their will) is even more doubtful.”
How can you even teach someone anything against their will? That makes no sense. If you mean that society should do so, then definitely. All forms of fraud should be combated against the frauder’s will, starting with all forms of usury.
That’s not what fraud is. Fraud is a deception. Asking for money in exchange for living quarters is not deception, it is in fact a peaceful trade in which both parties get what they want.
“Asking for money in exchange for living quarters is not deception, it is in fact a peaceful trade in which both parties get what they want.”
I never said that exchanging living quarters for money was fraud. I said renting, and all other forms of usury (i.e. asking for money for no labour in return), was fraud. But there’s nothing wrong with actually exchanging a building for something in return.
“How is it more convenient for a person to be subject to the whims of the so-called owner of the building he needs to live? Any supposed function of renting that is positive can be reproduced by other kinds of exchange.”
Depends on the circumstances and the individual preferences of the people involved.
For example, let’s say that I buy and live in a house with children, and after some years, the children grow up and move out. I have different options for the extra space I now have. I can use it myself, perhaps convert a bedroom into a den or gameroom, or whatever else interests me. Or I could make it available to someone else in exchange for compensation of some kind (doesn’t have to be monetary). For someone who just wants a cheap room for a few months, it’s a much better option to rent it from me than go about trying to make an outright purchase, especially if they’re very mobile and don’t want to stay in town for long enough to justify the expense.
“If the person who is “willing to pay rent” (tribute) to someone else, there must be a reason. They must be given opportunities to own their own place of living, and the person who is trying to exploit him should be prosecuted for fraud (asking for money in exchange for no labor).”
Who must give them these options? And who would bring the charge of fraud exactly? And who would the person charged compensate for the fraud if convicted?
I take it that panhandling is fraud as well by your definition. I hope there are enough courts to handle all the new business you’ll be generating. 🙂
“How can you even teach someone anything against their will? That makes no sense. If you mean that society should do so, then definitely. All forms of fraud should be combated against the frauder’s will, starting with all forms of usury.”
And against the will of the fraudee apparently, too.
Sorry, this consensual relationship is now forbidden. Get thee hence, evil doer!
“I never said that exchanging living quarters for money was fraud. I said renting, and all other forms of usury (i.e. asking for money for no labour in return), was fraud.”
‘Please, sir, I’m very sick and unable to work. Would you give me some change so that I could buy some bread? I haven’t eaten all day.’
‘I’m sorry, but that would be fraud, and I won’t be drawn into your criminal schemes. When you gather the strength to mow my lawn, let me know.’
I think the idea is not to specify which forms of exchange will not be allowed, so much as to remove the background conditions (engrossment of vacant land, reduced competition in the supply of capital, etc.) that make certain onerous choices more prevalent than they would otherwise be.
It may well be that some people would choose to rent simply because of a life situation that precluded a long-term investment in a fixed place of residence. But the value of rent is determined, in part, by competition from vacant land. And wages are determined by competition from opportunities for self-employment. Such competition would reduce the income of the landlord or employer to a value commensurate with their actual services.
“I think the idea is not to specify which forms of exchange will not be allowed, so much as to remove the background conditions (engrossment of vacant land, reduced competition in the supply of capital, etc.) that make certain onerous choices more prevalent than they would otherwise be.”
I agree with this, and I support all kinds of innovations and creative ideas on how to make living arrangements more accessible, more suitable for a variety of lifestyle needs, etc.
“It may well be that some people would choose to rent simply because of a life situation that precluded a long-term investment in a fixed place of residence. But the value of rent is determined, in part, by competition from vacant land. And wages are determined by competition from opportunities for self-employment. Such competition would reduce the income of the landlord or employer to a value commensurate with their actual services.”
Commensurate to service and assumed risk. Rate of return is not the only factor in determining value. For most people, two identical rates of return with different risk factors are not worth the same amount. Otherwise, yes, I agree completely.
“For example, let’s say that I buy and live in a house with children, and after some years, the children grow up and move out. I have different options for the extra space I now have.”
This is predicated on the concept of private property, and I don’t subscribe to it. So I won’t comment on this.
“Who must give them these options?”
As Kevin Carson rightly pointed out to you, the structure of society and the way it is run is what gives people options, or restricts them.
“And who would bring the charge of fraud exactly? And who would the person charged compensate for the fraud if convicted?”
All the people who were forced to pay “rent” to a person for no labour exchanged.
“I take it that panhandling is fraud as well by your definition.”
What in the hell are you talking about? The panhandler is not trying to extort money from people so they can use an object. They are asking for charity. Are you seriously arguing that renting a house is a form of charity? If so, you have a major semantic problem.
“Sorry, this consensual relationship is now forbidden. Get thee hence, evil doer!”
There are plenty of evil things that unethical people like you call consensual. The work contract is evil. Creating a vagrant class through expropriating the masses from their common lands and hiring them as workers for unsafe and unfree jobs is that started the capitalism. Hiring a soldier or a hitman is also a “consensual relationship.”
You bet I want those exploiters and murderers to “get thee hence.”
“”Please, sir, I’m very sick and unable to work. Would you give me some change so that I could buy some bread? I haven’t eaten all day.’
‘I’m sorry, but that would be fraud, and I won’t be drawn into your criminal schemes. When you gather the strength to mow my lawn, let me know.’”
Thank you for unwittingly giving us a short portrait of the capitalist system, where poor people are deemed unfit, and where “equality” means “equality for those who have enough money.” That is what you believe in.
“As Kevin Carson rightly pointed out to you, the structure of society and the way it is run is what gives people options, or restricts them.”
Yes, and given those options, two people may voluntarily enter into an arrangement as described after surveying their options. That you can’t imagine yourself as ever being interested in such an arrangement is fine, but it doesn’t mean you can know the minds of everyone else who might.
“All the people who were forced to pay “rent” to a person for no labour exchanged.”
No use of force was described or implied in the example.
“What in the hell are you talking about? The panhandler is not trying to extort money from people so they can use an object. They are asking for charity.”
I’m just using your definition of fraud. “Asking for money for no labour in return” (direct quote). A panhandler is asking for money and not exchanging any labor for it. I suggest that either your definition is flawed or you should acknowledge the implication of it.
And yes, I’m aware that it’s charity, but there’s no necessity that asking for charity can’t be construed as fraud at the same time. A strange moral view, to be sure, but not inherently contradictory.
Not saying this is my belief.. simply applying your definition.
“Are you seriously arguing that renting a house is a form of charity? If so, you have a major semantic problem.”
No, but I’m suggesting that by your definition, asking for charity is fraud, and since that’s pretty clearly an absurd position to hold, it might be that other implications of your definition (like defining rent as fraud) are also absurd. That’s all.
“There are plenty of evil things that unethical people like you call consensual. The work contract is evil.”
Can’t help but be reminded of “Look, let me go back in there and face the peril.” “I’m sorry, but it’s far too perilous.”
It’s nice that you have such a clear understanding of evil, but for the person who wants to rent a room and the person willing to rent it to him/her, you’re interposing yourself as a righteous champion and forcing your will on at least one of the parties. That to me seems far more dangerous and closer to my understanding of ‘evil.’ The fact that you have a better option for the hapless renter is fine. Offer it. Persuade. Try to convince them that there’s a better way.
“Hiring a soldier or a hitman is also a “consensual relationship.””
True, up to the point where they use or threaten violence against a third party.
“Thank you for unwittingly giving us a short portrait of the capitalist system, where poor people are deemed unfit, and where “equality” means “equality for those who have enough money.” That is what you believe in.”
Hardly. Fix your definition, and I’ll revisit the scenario it generated.
Since you seem to be stubbornly ignoring the issue, let me spell it out for you.
There is no ethical problem in saying that a panhandler is owed a living, either through work or through other people’s work if no work is made available to him, if we follow the principle of equality. Likewise for the landowner, as a HUMAN BEING, not as a landowner. It is unethical for the landowner to demand resources on the basis that he is making available a building to someone else, without labouring upon it at all. But obviously a panhandler, if work is not available to him, cannot labour in order to exchange! Therefore he could not fulfill this condition.
Now the capitalist system (the system of private property as applied to work) which you support not only entails chronic unemployment, but depends on it in order to survive. So how is your position any favoured by your silly example?
“There is no ethical problem in saying that a panhandler is owed a living, either through work or through other people’s work if no work is made available to him, if we follow the principle of equality.”
I’m not sure what this principle of equality is that you’re referring to. Equality of what exactly? Opportunity? Outcome? Options? And now others have a positive obligation to remedy any inequality that may be found?
Interesting, though, that a panhandler who is offering nothing to anyone is owed something (and could actually be fraudulently soliciting funds by lying about their actual capacities/situation), while a person who makes extra space in their house for someone to rent is a vile thief.
“Likewise for the landowner, as a HUMAN BEING, not as a landowner. It is unethical for the landowner to demand resources on the basis that he is making available a building to someone else, without labouring upon it at all.”
Why use the word ‘demand’? I’ve never rented from anyone who demanded something from me. They offered a room in exchange for payment; I accepted; it was a mutually agreeable situation. It would make as much sense to say that I ‘demanded’ they provide me a room, (i.e., none at all).
“But obviously a panhandler, if work is not available to him, cannot labour in order to exchange! Therefore he could not fulfill this condition.”
You’re the one who’s making up these conditions, though. If I want to give something to someone without them laboring for it, why does it matter to you whether they have work available to them or not? Who are you to decide whom I give my resources to and for what reason? It’s none of your business if the person I give money to deserves it or not, whether it be a panhandler or a person I’m renting from. In either case, I agree to give it, and it’s their decision whether to accept it or not.
“Now the capitalist system (the system of private property as applied to work) which you support not only entails chronic unemployment, but depends on it in order to survive. So how is your position any favoured by your silly example?”
My example was a absurdist application of your principle, not my own favored system. Now you introduce more sub-clauses to salvage it, and we now need to hear how the principle of equality (singular) factors into it and when we can be assured that someone is entitled to charity (and who is obligated to provide such entitlement). It just gets better and better.
The system of chronic unemployment is largely the fault of forceful interventions through law and regulation that prevents people from working for themselves, forming small businesses without incurring huge reporting and auditing expenses, and a variety of other things that I’m probably not even aware of but that choke out real opportunities every day. I’m not a defender of the status quo. I am a defender of people coming together and forming mutually agreeable work and living arrangements as they see fit, and I trust that in that process, better options will emerge and continue to evolve. Some of those options might include rent. If rent becomes a permanently sub-optimal option, then that’s fine with me, but I’m not about to prosecute someone for fraud who never did anything but make a peaceful offer without any deception about the terms.
This is incredible. I am explaining something to you and you’re treating it like a concession! Well, I am certainly not going to give you any further ammunition for your little game.
You are a voluntaryist, therefore you are a capitalist, period, no matter what you claim. Voluntaryism is merely an ideological rationalization of the more routine aspects of capitalism, nothing more. The details of your support for capitalism are not relevant.
When you go on a trip (whether in Libertarianland or in our world), would you prefer to buy your hotel room each night and then try to find a buyer for it the next morning when you need to leave?
If not, then you acknowledge that even in a freed market it can sometimes be more efficient to rent than to own. Why do you want to block people’s freedom to make that choice?
If they got the property legitimately, then sure, why not?
And anyway it’s not as though managing rental properties involves no labour.
True. But the root of that process was a) the churchstead tax (which everyone in a given district had to pay whether they wanted to use that church or not), and b) the legally defined upper limit on the number of chieftaincies. The parallel with allowing people to rent out their legitimately acquired property seems weak. What’s the argument for thinking that allowing rental contracts will create a privileged class? When the legal barriers to becoming an owner are removed, existing owners wouldn’t be able to use their land ownership to establish themselves as a privileged class.
Sure. But a standardised contract and a one-sided contract aren’t the same thing.
“Systematically empowered”? Empowered here is used in an ambiguous way.
I’m not so sure the very institution of leasing apartments, or the institution and practice of employment, to be itself problematic. The problems you allude to, it seem to me–being at the mercy of landlords or employers–come with being relatively impoverished. If one is wealthier these problems disappear or are reduced. And how do we make people richer? The free market and respect for property rights. To take a simple example: apartments would be cheaper, and people would have more money, in a free society, so the problems of being evicted would be less and unreasonable terms in contracts could be avoided more easily. And if you have tons of money saved, then your employer can’t threaten you so easily with unreasonable conditions since if he fires you, you can survive a long time without his help and can easily find another job.
I can’t speak for Roderick, but I suspect something like the scenario you describe was part of what he had in mind. Eliminating artificial scarcity rents to the owners of land and capital, and eliminating artificial floors under the cost of subsistence for the household and for small producers, would greatly shift the relative bargaining strength of ordinary people with their employers and landlords. It would have the same kind of effect that access to the common had on the bargaining strength of rural labor before the Enclosures.
Certainly if most people could pay off mortgages in ten years, rents and mortgages were 20% of the average monthly income rather than 40%, fewer people had credit card debt and a lot more had a savings account with some FU money in it, etc., the labor market would be almost unrecognizable.
Kevin, could you please elaborate on this–what exactly does this mean, or what would it entail? —
“Eliminating artificial scarcity rents to the owners of land and capital, and eliminating artificial floors under the cost of subsistence for the household and for small producers”
–?
Among other things:
Cease enforcing titles to vacant and unimproved land that was never homesteaded by labor, eliminate capitalization requirements for banks providing secured loans against their members’ property, and eliminate legal restrictions on the kinds of local credit-clearing systems Tom Greco writes about.
Eliminate patents and copyrights and all forms of trademark other than restrictions on actual fraud or identity theft.
Eliminate all zoning laws that require renting free standing commercial real estate to do business, all safety and health regulations whose main function is to impose increased capital outlays and overhead on small producers, and in general make small-batch production in the informal/household/microenterprise sector less feasible.
Eliminate the portion of price of goods and services that amounts to broken windows, subsidized waste, extra steps in Rube Goldberg contraptions, and digging holes and filling them back up again. This includes all the inventory costs and marketing costs from the kind of supply-push distribution model resulting from the state’s promotion of the Sloanist mass production model, planned obsolescence, etc.
Kevin:
“Cease enforcing titles to vacant and unimproved land that was never homesteaded by labor,”
I can go for that, so long as it does not refer to merely to privately held land that is remotely controlled, is owned by a corporation, etc.
“eliminate capitalization requirements for banks providing secured loans against their members’ property,”
I don’t follow what you mean here, exactly. Banks should simply either safekeep deposits (warehousing, irregular deposits) or intermediate lending. Fractional reserve banking makes no sense.
“and eliminate legal restrictions on the kinds of local credit-clearing systems Tom Greco writes about.”
I’m not familiar with this.
“Eliminate the portion of price of goods and services that amounts to broken windows, subsidized waste, extra steps in Rube Goldberg contraptions, and digging holes and filling them back up again. This includes all the inventory costs and marketing costs from the kind of supply-push distribution model resulting from the state’s promotion of the Sloanist mass production model, planned obsolescence, etc.”
I’m not sure what this proposal means in practice to private property holders.
The rest, re IP etc., I agree with, of course.
Re bank licensing, I’m referring to mandates that a bank have minimum capitalization levels, even if loans are entirely secured by mortgaged property. The effects are analogous to what Rothbard described re life insurance regulations that required reserves over and above actuarial requirements.
Tom Greco’s credit clearing networks function like checking accounts; when a member purchases the goods and services of another member, the balance goes down, and when they sell goods or services it goes up. But it is allowed to run a negative balance. It is essentially a barter system.
The proposals re push distribution costs, planned obsolescence, etc., simply mean an end to state policies that tip the balance toward large-batch, capital-intensive, mass-production techniques, and state policies (like M-I complex purchases, aggregate demand management, etc.) that help guarantee absorption of the output of industry running at full capacity. Also an end to the legal support IP provides for planned obsolescence.
I disagree, of course.
Roderick, I agree with a lot of your essay. But you argue that the line between loans and bailments is not as sharp as one might at first think. There are significant differences between them, however, regardless of how “sharp” they are, and these differences can have a bearing on both the fraud question and on the economics question. I think your conclusion would be on firmer ground had you specified the nature of loans instead of taking it for granted. Yes, there is risk of loss in the case of bailments; but this loss can be insured against, while the loss of inability to repay loans cannot be (arguably) since this depends on the entrepreneurial success of the creditors to whom the bank lends out money.
And yes, there may be a short lack of availability of the bailment funds, but this is different than that for loans: for loans, in a fractional reserve system, there can be unlimited suspension and moreover, the bank can become insolvent simply due to a bunch of bad loans having been made. But the “warehouse” does not face the same kind of insolvency risk.
I think it’s stretching it to refer to the custodian as the owner or co-owner; in any case it’s limited in scope and time. It’s unlike the loan since here the bank gets full ownership so that it can loan the funds to a borrower.
It is easy to see why a note representing title to gold in an irregular deposit could serve as a money substitute–even if there are some risks here that are not present for actual gold cash, there are also some advantages. It is not obvious apriori that notes that are title to gold deposits could function as money substitutes, but we have some reason to think this could happen. And they do not apply in the same way to promissory notes. A promissory note is title to a future good. But the future is uncertain, meaning the existence of the future good is also uncertain. A note may be title to nothing at all–it cannot be known until the due date arrives. The debtor (the bank) may be unable to honor loan repayment/redemption demands, because it simply does not have the assets (because too many of its loans turned out to be bad loans, say). Now, can such IOUs become money? Can they circulate as money along with titles to actual money? It is not obvious that they can (Huelsmann provides reasons why such IOUs can only serve as media of exchange in very limited cases in Has Fractional-Reserve Banking Really Passed the Market Test?, pp. 402-403). Again, the difference between them is sharp enough to treat these differently in many key respects that have relevance for the FRB debate.
Re fraud, I have always maintained that FRB is not inherently fraudulent, so long as there is adequate disclosure. Surely the differences between loans and bailments requires, well, disclosure of which one it is–regardless of how “sharp” the differences are.
To back up: I said “Fractional reserve banking makes no sense.” You said you disagree, citing your paper, but your paper only argues that loans and bailments don’t have as sharp a difference as some might think. Even if you are right this does not mean there are no significant differences, and it doesn’t gainsay my view that it makes no sense. My view is an economic one, based on the idea that I think the central fallacy of FRB is that is rests on the idea that money is wealth and/or that creating more credit can be desirable; in my view, money is just a medium of exchange between valuable goods, and this is exactly why any supply of money is optimal; and if any supply of money is optimal there is no need to increase the supply.
The real economic debate concerns whether there are problems that need to be addressed (I’d call it market failure); whether FRB can address this; and whether FRB IOUs can circulate as money, alongside with money. The FRFBers predict that it can. Rothbardians think it will not, or cannot, or at least is extremely unlikely. I agree, but of course think it should not be prohibited to try. The loans held by customers of a FRFB — they can try to use them as money. Would they succeed? I doubt it. If someone tries to pay me for a watch by giving me a $100 note to a real (irregular deposit) bank, or a $100 promissory note, I’d much prefer the former, since the latter has extra uncertainty and risk that the former does not. But that’s just me. Others would be free to use promissory notes in exchange if they cared to.
But on the one hand, in some cases insuring bailments will be inherently inadequate (e.g. in the case of items of irreplaceable value) and in many others the cost will simply be prohibitive for the depositor. And on the other hand, insuring against inability to repay loans is precisely one of the things that suretyships and mutual-aid societies have historically done.
Well, they often have. And whatever is actual is possible.
Roderick Long,
I know this is probably not the best place to ask this, but I don’t know of any other place. So…
Do you answer questions from fans in your Contact page in this website? Because I used that page to ask a question to you about economic goods, but I don’t know if it is appropriate.
Thanks.
P.,
Check out the contact information on this page:
http://praxeology.net/molinarisoc.htm
If what you’re referring to is the e-mail address, I sent an email long ago to that address and never had an answer.
That’s why I tried the contact page on this blog.
Thanks anyway.
Any question submitted via the contact page just comes to me as an email. I try to answer every email but often get swamped.
I apologize if someone posted something closely related to what I’m about to ask, but the responses are huge; tl;dr.
If entering into a rent contract or employment contract under the aforementioned conditions, what recourse is allowable under the natural law in order to defend and secure one’s rights?
This inequality seems to stem ultimately from state power, which the landlord or the employer are wielding by proxy. So which aspects of their contracts would be unenforceable, considering that those aspects would only be possible through the use of state power?
That’s an excellent question to which I have no especially detailed reply, other than the not terribly helpful remark that when a contract is neither completely voluntary nor completely involuntary, the legitimate response lies somewhere between what would be appropriate in the case of either extreme. Kevin has some useful things to say about the employment situation here.
Round 1?
This is why we can’t have nice things.
Here is one possible objection.
This is Marx’s critique of the institutional background of the market economy in perfect competition, and Rawls’ conception of political justice as principles applying to the “basic structure of society.”
I’m not sure what “This” refers to, but if it’s supposed to refer to anything I’ve said, I don’t see how. My account of justice/injustice centers on rights-violations of individuals by other individuals (including, but not limited to, individuals organised into groups called “governments”). The background conditions I’m talking about are conditions involving that kind of injustice.
The cable company enjoys a government-granted monopoly. I can’t switch to another cable company. Of course I could switch to a dish network, or give up tv altogether; still, my options are pretty limited, by force of law.
Of course if enough customers are pissed off the cable company may lose its contract with the town government. But that’s a pretty clumsy feedback mechanism.
No, but in both cases my options are more limited than they would be in a free market.
Your argument sounds a lot like an argument that you’re probably not such a fan of: “of course you’ve consented to the government. No one forces you to live in America.”
The more oligopolistic the market, the less impact such feedback can have.
You raise some interesting points here, but I’d like to challenge on one idea you raised. You say that “…there’s no easy way for you to put a frowny face on their credit report” in speaking of the cable company. I would disagree. While one ‘blackout’ is unlikley to hurt them in any substantial way (i.e., they recieve no ‘frowny face’), they will go out of business if they provide bad services.
I guess where I would challenge your analysis is that you seem to understand the employer-employee relationship as a mutual relationship, but fail to see that same in the rest of the market (e.g., the cable company). While the cable company and the landlord write the contract, they do not force you to sign it. Failure on their part to meet the demands of the customer will result in a loss of business. Sure, let’s face the fact, that they can ‘get away’ with cheating a few people here and there b/c of their under-handed, fine print contracts, but this is hardly the stuff that seperates the wealthy from the unwealthy.
The only real inequality is b/t government and those that are FORCED to live by its rules.
Actually they do, and have.
Are you sure you know what you are talking about?
Rod writes,
“On the other hand, suppose that, for whatever reason (internet glitches, downed power lines after a storm, or who knows), you suffer a temporary interruption of service from your provider. Do they offer to reimburse you?”
I see that your blog has already noted that I’ve posed an article replying to your blogpost, but just wanted to note that I posted a reply to your article: Is Inequality and Asymmetry Really Problematic?
http://www.libertarianstandard.com/articles/david-j-heinrich/is-inequality-and-asymmetry-really-problematic/
I refer you back to this point:
“They’re cases in which some people are systematically empowered to dictate the terms on which other people live, work, and trade…. But it’s not obvious that things have to be that way…. [A]ll the phenomena I mentioned are made possible by systematic restrictions on competition.”
Roderick’s point was not simply that constraints on the worker, tenant, etc., are perceived as unpleasant as such, out of some general objection to all restraints which we’d prefer to be without in a perfect gnostic world. He has specifically argued that they’re problematic, not just because they’re unpleasant as such, but because these unpleasant-as-such things exist to a greater extent than would be the case in a free market.
For example, most people prefer workplace situations in which they have a high degree of control over their work–as such–to those with a high degree of subordination and micromanagement. One might argue that some degree of subordination is necessary, and (as Bryan Caplan argues) that it is compensated by higher wages. But when the degree of subordination, which is unpleasant in itself, is higher than it would be in a free market, because of systematic distortions of power relationships, it is problematic.
“One might argue that some degree of subordination is necessary, and (as Bryan Caplan argues) that it is compensated by higher wages. But when the degree of subordination, which is unpleasant in itself, is higher than it would be in a free market, because of systematic distortions of power relationships, it is problematic.”
You have no way of knowing how much subordination would be present in a free market. Praxeologically speaking, there are forces causing less subordination, per se, than would exist in a free market, just as there are forces causing more subordination, per se.
Lets look at the forces causing more subordination. What is the result of greater subordination? Or rather, what causes more subordination to be accepted by many workers? Well, in a world with a free market, people would overall be a lot richer, compared to the world we have now. So the world we have now is a lot poorer than it would be if we had free markets. Ceteris paribus, this causes a shift in preferences towards jobs that require more subordination but pay higher vs. those that require less subordination and pay lower.
All this is of course assuming that we accept that subordination in a job is viewed as an “economic bad” — something that Roderick Long and yourself seem to assume, and that Caplan apparently capitulates on without objection. While I’d agree that some see it as an “economic bad”, that is one-sided. As I noted in my article, jobs with more freedom and less “subordination”* — e.g., owning your own business — also come with more responsibility and worry. I can assure you that there are many people who like the idea of going to work; doing what they are told to do; having no real entrepreneurial or creative responsibility, but only responsibility for implementation of directives; then clocking out, going home, and forgetting about their job. At the very least, this is one benefit to this kind of position.
The business owner is almost never in this position, because the buck stops with him. There is a continuum of jobs — e.g., hourly jobs, salaried position, salaried positions with bonus, business ownership ownership — that offer varying trade-offs in at-work freedom and discretion, responsibility, requirement for creativity and entrepreneurship, and the ability or inability to forget about your job when you leave work.
As you go “up the ladder” so to speak, it becomes much easier to have positions where there is latitude, freedom, creativity, and broad responsibility, with compensation based on company performance. Think about having a largely variable salary compensation for an entry level employee, based on company performance. No one would accept that, because entry level employees have little responsibility for that individually. Now, bonuses and raises based on assessed performance is another matter — but doing a good job of truly evaluating employees is actually expensive, and not entirely objective.
This is very easy for the private business owner — their compensation is based entirely on the performance of the company. They are responsible for everyone below them indirectly — e.g., for hiring them. Their compensation purely on whatever is left over residually after all expenses, debt payments, employee paychecks, manager bonuses, etc have been accounted for. They bear the most risk.
One can make an educated guess, praxeologically, as to whether there would be *less* subordination in a free market economy, if not as to *how much* there would be. I suspect you yourself make such educated guesses as to the net effect of government policies, without so much epistemological skepticism.
The more jobs are competing for workers, the less onerous the conditions of employment are apt to be. The more workers competing for jobs, the more onerous.
Re subordination, I don’t think you fully grasp the distinction between desireable *as such* and desirable as part of a *package* in which it is accepted despite its unpleasantness in return for some other good. I don’t doubt that workers put up with some degree of control and subordination in return for less risk and responsibility. But it’s the reduced risk and responsibility that are the positive side of the equation, not the risk as such. Given any stipulated amount of risk and responsibility, I believe the vast majority of people would prefer it with more control over their work rather than less.
In the real, non-gnostic world, of course, we must accept lesser evils as a condition of greater goods, that more of one desirable thing costs us a reduction in the available amount of some other desirable thing. That’s the difference between the world we live in and Big Rock Candy Mountain. But the fact that the evil is accepted as part of a package deal that’s more attractive overall, does not alter the fact that it is viewed as an evil.
Your own argument that a poorer world results in “a shift in preferences towards jobs that require more subordination but pay higher vs. those that require less subordination and pay lower” strikes me as amounting to an admission that subordination is accepted as a means to an end rather than valued by most workers for its own sake.
All this leaves aside the question as to whether the prevailing degree of subordination promotes ends of rationality that would exist in a free market. To the extent that state policy promotes increased firm size, hierarchy, and managerialism, a significant part of the prevailing level of subordination may reflect management self-dealing (i.e., be for the sake of promoting management preferences at the expense of the productivity of the enterprise).
“Praxeologically, to state that a relationship is “asymmetrical” is to say that one party gains more out of it than another.”
That’s not what the word asymmetry means. This is just redefinition of the sake of redefinition. Also, praxeology is little more than verbal diarrhea, axiom-fetishism writ large, on the whole.
What’s your basis for that claim?