Are you a college graduate fed up with the uncertainty and stress of the job hunt? Have you been sitting in Starbucks for days, sipping lattes and hopelessly sending out job application after job application? You’re certainly not alone. There are 11.7 million unemployed people struggling to find a job in America. Prof. Carrie Kerekes presents three reasons finding a job in today’s market is so difficult: a mismatch of skills, government regulations, and uncertainty in the market. These three things all have one common factor: government interference.
Many believe that market economies create a dog eat dog environment full of human conflict and struggle. To Prof. Aeon Skoble, the competition in markets does not create conflict, but rather, encourages people to cooperate with one another for mutual benefit.
For instance, suppose a thief steals a suit from Macy’s. If Macy’s knew who the thief was, one could argue that Macy’s has an incentive to keep this information from their competitors. By withholding information about the thief, it would make it much less likely that thief would get caught while robbing Macy’s competitors. However, in the real world, competitors share information about theft with one another, creating a valuable information network. Competitors share information because it is in all of their mutual interest to crack down on theft. If a business chooses to ignore the information network, they lose out on valuable information.
The example above is just one of many examples where competitors have a strong incentive to cooperate with one another. In a certain way, we’re all merchants who trade with one another. We all individually depend on networks of reputation and trust to own a car, own a home, and have a job. In a world of competition and scarcity, we are not only capable of cooperating with one another, but we frequently do.
These voluntary systems of social cooperation, often called organic or spontaneous orders, are not planned from the top down by enlightened rulers. Rather, they emerge overtime as individuals interact with one another. These spontaneous orders are all around us, and include important things like language, fashion, internet memes, prices in a market, and law.
Going back to the suit thief, it may very well be the case that some individuals abstain from crime because of the threat of jail. However, it is also very likely that crime is prevented through networks of trust and reputation. The next time you hear that the problems that society faces can only be solved by applying force from the top down, you are right to be skeptical. Peaceful and voluntary mechanisms that encourage and facilitate cooperation are all around us.
Although many conflate capitalism and imperialism or think the two systems are closely connected, they are actually quite different, even at odds with one another. Capitalism is a system based on voluntary exchanges that benefit all of the parties involved. In contrast, imperialism is based on exploiting the poor through political power and military force. Prof. Stephen Davies shows that capitalism has been blamed through the years for a number of catastrophes—such as political corruption, exploitation of the poor, mass famines, and others—that were in fact a result of imperialism.
Should government provide law enforcement? Most would argue that government is absolutely necessary for law enforcement. Prof. Edward Stringhman, however, argues that government may not even be necessary at all.
To come to this conclusion, Prof. Stringham asks a few important questions. First, if something is really important, does it logically follow that government should provide it? Second, are markets capable of providing law enforcement and security in the modern world? Third, how are disputes currently settled between people of different countries?
Looking at the first question, it doesn’t seem to be the case that important things must be provided by a government. For instance, think about food. Food is necessary for life, and yet, markets do an excellent job of providing food to consumers.
Even if you’re convinced that markets can provide important things, you may think law enforcement and security are a special case that markets are incapable of providing in a modern world. However, markets already enforce private rules and provide security. Disney World, Las Vegas, and malls all have private rules that are enforced by private security.
Accepting the arguments above, you may still be skeptical about market’s abilities to settle disputes between different systems of rules or law. This, in fact, was Ayn Rand’s primary reason for advocating a minimal state. Current interactions in the real world provide examples as to how markets resolve these disputes. Think about an international soccer game or international trade. In both instances, individuals are interacting across state boundaries, and are only subject to the jurisdiction of their own territory. In these situations, these individuals contract with the arbiters such as a soccer league or a private court to resolve disputes.
Credits: This lecture was delivered in 2009 at the Metropolitan State College of Denver School of Business, as part of the Exploring Economic Freedom Lecture Series, directed by Prof. Alexandre Padilla. This video was produced and directed by Scott Houck, and edited by Adrienne Christy. Video production provided by the Educational Technology Center at Metropolitan State College of Denver. Video used by LearnLiberty.org with permission.
If you’re unfamiliar with LearnLiberty, it is a group associated with the Institute for Humane Studies to teach about the philosophy, economics, and political theory of libertarianism. It is HIGHLY recommended by me and virtually everyone I have ever talked to. Many of their videos are on Youtube and talk about things like sex discrimination, social justice, and history of classical liberalism.
Do democracies promote freedom? According to Prof. Aeon Skoble, it is definitely possible for democracies to promote freedom, but it is not a guarantee. This is due to a few flaws inherent in democratic systems:
1) Majority belief in something does not necessarily mean that it’s true. 2) Majorities are capable of being just as tyrannical as kings 3) Historically, democracies have elected tyrannical leaders.
If freedom is the primary value of a society, democracy might still be of use so long as there are boundary conditions on the democratic process that protect the rights of the individual.