Is government necessary?

[August1991]

In numerous threads, we have touched on these questions without ever having addressed them directly. I think the first step is to justify the existence of government, and then consider what government should do.

Quoted from here.

I own my house but in another thread, there was debate about who owns the air stretching 10 km above my house. Who does? Can I sue Air Canada if their plane flies in my air?

You're right, this was asked, and I already answered it.

Hugo, I have done several searches on the forum without finding your answers, nor do I recall ever reading a satisfactory answer.

The example of overflight rights is only one of many where government (an institution with coercive powers) would be to everyone's benefit.

[Cartman]

This is an excellent thread, but it requires careful consideration. I will reflect and respond soon.

[theloniusfleabag]

Dear August1991,

It is my contention that a gov't, in some form, is absolutely vital IF one desires to live other than a 'subsistence-farming hermit with a nuclear arsenal'. I believe that it would be an impossibility to have effective and safe interaction between 30 million 'nations of one'.

[Hugo]

Hugo, I have done several searches on the forum without finding your answers, nor do I recall ever reading a satisfactory answer.

Here is the link, and here is an extract:

Now consider planes flying over head. If airlines had to negotiate with each landowner overflight rights, the cost of negotiation would be prohibitive. One person could potentially hold up the whole arrangement.

Assuming that the people on the ground also automatically own the airspace above them. It might not be so. Airplanes can also find alternative routes. Airlines might also bundle their flight patterns, buy the property along their routes and then sell it again with the clause that their aircraft will be allowed to fly over it in perpetuity.

Then you said:

If it were profitable to do as you suggest, why hasn't somebody done it?

To which I replied:

Water takes the path of least resistance, people take the path of greatest profit. As it stands, since the state has arbitrary power it makes more sense for airlines to have the state forcibly make the arrangements for a new airport. This is more "efficient" only if you do not regard parties other than the airlines as having any desired outcome. Quite simply, it's like saying that the most efficient way for me to acquire a television is to steal yours. It's true, if your interests are disregarded entirely.

You didn't seem to have a further reply.

Quite simply, there's a whole herd of erroneous assumptions in your argument. Firstly, you assume that some kind of evil could arise through full property rights. That is not established. Then, you assume that government is able to correctly divine the "greater good" and so override property rights in the event that said rights were not producing an optimal outcome. This is not established either. And thirdly, but definitely not in the least, there is your assumption that there is some objective standard of good, achievement or benefit that government can work towards on our behalf.

Before you can establish these things I see no point continuing with an argument based on unproven premises. Or should we talk about what we could use the moon for if it were made of cheese?

It is my contention that a gov't, in some form, is absolutely vital IF one desires to live other than a 'subsistence-farming hermit with a nuclear arsenal'. I believe that it would be an impossibility to have effective and safe interaction between 30 million 'nations of one'.

But you've already told me that you don't believe there is any point or substance to safety of interaction and that the law of the jungle, the strong dominating the weak, is the only reality of life. So what is the point of this self-contradictory gambit?

[August1991]

Thanks Hugo, that's the exchange I was looking for.

Assuming that the people on the ground also automatically own the airspace above them. It might not be so. Airplanes can also find alternative routes. Airlines might also bundle their flight patterns, buy the property along their routes and then sell it again with the clause that their aircraft will be allowed to fly over it in perpetuity.

Imagine the cost of organizing that. A flight from Toronto to Vancouver crosses over how many people's property? Trying to negotiate the overflight permission from thousands of owners would be very costly. Even more pertinent, each person would have to know whether a plane had used their airspace. What would prevent planes from cheating? IOW, no one could defend the property right.

Water takes the path of least resistance, people take the path of greatest profit. As it stands, since the state has arbitrary power it makes more sense for airlines to have the state forcibly make the arrangements for a new airport.

The issue is not an airport, Hugo. The issue is who owns the airspace above my property.

Individuals take the path of greatest net benefit but that doesn't always lead to the best collective solution.

This is more "efficient" only if you do not regard parties other than the airlines as having any desired outcome. Quite simply, it's like saying that the most efficient way for me to acquire a television is to steal yours. It's true, if your interests are disregarded entirely.

A TV is a bad example here, but a TV signal is not. If I "steal" your signal, what have you lost? And going further down that path, if everyone could steal the signal, why would anyone produce one?

Firstly, you assume that some kind of evil could arise through full property rights. That is not established. Then, you assume that government is able to correctly divine the "greater good" and so override property rights in the event that said rights were not producing an optimal outcome. This is not established either. And thirdly, but definitely not in the least, there is your assumption that there is some objective standard of good, achievement or benefit that government can work towards on our behalf.

It would wonderful if we could define property rights fully but the problem is that we often cannot - or we cannot trade those rights. In such cases, a coercive institution like government can possibly improve things. I agree that government will have a problem knowing what to do to make things better.

100 years ago, ownership of airspace 10 km above the earth was irrelevant. Then, the space became valuable. It makes far more sense to give ownership of all airspace to one entity rather than give it piecemeal to thousands of landowners on the surface beneath.

[Hugo]

Imagine the cost of organizing that. A flight from Toronto to Vancouver crosses over how many people's property? Trying to negotiate the overflight permission from thousands of owners would be very costly. Even more pertinent, each person would have to know whether a plane had used their airspace.

Assuming that everyone owns the pillar of atmosphere above their house. How far up does it go? Into the stratosphere? Into geostationary orbit? Is the placement of satellites a violation of the property rights of a homeowner directly below?

Do you seriously think a private court would entertain such claims of rights-violations without some express entitlement, by which I mean e.g. the ownership of an air corridor by one airline that was being used by another airline without the former's consent?

Think of it as pollution. One anarcho-capitalist thinker defined pollution as the transmission of harmful matter or waves to the property of another without consent. If the flight path is so low that it is causing a harmful effect to the homeowner, he should be able to sue and rightly so. On the other hand, an aircraft passing overhead at about 35,000 feet (the cruising height of most airlines) does not pose reasonable harm to anybody and a lawsuit against it is unlikely to be entertained.

In any case, since the atmosphere is currently unowned we are looking at homesteading to establish ownership and it is likely that airlines rather than homeowners would do the homesteading. The homeowner is likely to be defined as owning his house and the land on which it stands, and rather than extend his property into orbit it's much easier to require that whoever owns the land and atmosphere around and over him not violate his property rights in his house and land.

As this is the most likely solution by far, I think your notion that homeowners would own a column of atmosphere possibly hundreds of kilometers high and your objection to the problems this would pose is, in fact, a strawman.

Individuals take the path of greatest net benefit but that doesn't always lead to the best collective solution.

What's "collective"? There's nothing that we actually all share equally, therefore, when you talk of collective solutions what you really mean is solutions that benefit some individuals more than other individuals - which puts a very different spin on things.

A TV is a bad example here, but a TV signal is not. If I "steal" your signal, what have you lost? And going further down that path, if everyone could steal the signal, why would anyone produce one?

This is why you have satellite decoder cards and advertising. Think of a problem and I guarantee you that some smart entrepreneur, in a free market, will solve it. It's an arrogant fallacy to think that if you can't think of a solution that means there is no solution. It's a very similar fallacy to believe that a few dozen bureaucrats would come up with a better solution than the 30 million minds in Canada or the 6 billion minds in the world.

It would wonderful if we could define property rights fully but the problem is that we often cannot - or we cannot trade those rights. In such cases

What cases? Again, a vast assumption of something by no means proven.

It makes far more sense to give ownership of all airspace to one entity rather than give it piecemeal to thousands of landowners on the surface beneath.

What of the third solution? Why is granting exclusive ownership to one institution forever and in all eternity a good idea? Think of media control in the USSR. What was intended to be for the good of the people ended up being for the good of Communist Party apparatchiks, much as the CBC has become a tool of the Liberal Party.

[Guest eureka]

I would think that the question should rather be "How much government is necessary?" Leaivg aside the anarchist and associated viewpoints that I cannot see as other than absurd, John Locke pretty well summarised the minimalist government belief with his "Social Compact" theory.

That is that there must be protection for our natural rights. These rights are, in a state of nature, exposed to the possibility of the strong taking from the weak; or, the weak banding together to subdue the strong.

It defies credence to say that this will not happen in the absence of government given the observable tendencies of human nature.

[Hugo]

That is that there must be protection for our natural rights. These rights are, in a state of nature, exposed to the possibility of the strong taking from the weak; or, the weak banding together to subdue the strong.

It defies credence to say that this will not happen in the absence of government given the observable tendencies of human nature.

What actually defies credence is setting up an institution capable of indulging the worst excesses in human nature and imagining that this institution will protect us against those excesses.

[theloniusfleabag]

Dear Hugo,

the law of the jungle, the strong dominating the weak, is the only reality of life. So what is the point of this self-contradictory gambit?

You are assuming, Hugo, that I have given favour to one side or the other. Just because I pointed out the mechanisms of 'rights', doesn't mean that I wouldn't choose otherwise given the chance. In fact, I do every day.

As this is the most likely solution by far, I think your notion that homeowners would own a column of atmosphere possibly hundreds of kilometers high and your objection to the problems this would pose is, in fact, a strawman.

Nonsense, it would have equal validity on par with any 'right'. Some people were selling plots on the moon years ago...who 'owns' it? I laid claim to it years ago in an argument with another friend of mine, (when we were both about 9 or 10) but can this make it mine? Do I have to go invade and stick a flag in it to 'own it'?

[Hugo]

You are assuming, Hugo, that I have given favour to one side or the other. Just because I pointed out the mechanisms of 'rights', doesn't mean that I wouldn't choose otherwise given the chance. In fact, I do every day.

Then why do you contradict yourself? Why don't you believe your own ideology? As I've said before, if you can't take yourself seriously why should I?

Nonsense, it would have equal validity on par with any 'right'. Some people were selling plots on the moon years ago...who 'owns' it? I laid claim to it years ago in an argument with another friend of mine, (when we were both about 9 or 10) but can this make it mine? Do I have to go invade and stick a flag in it to 'own it'?

In short, yes. You can't just say something is yours and hey presto, it is. Do some more research on the concept of homesteading, please.

[theloniusfleabag]

Dear Hugo,

Why don't you believe your own ideology?

I never adopted it as an ideology, I presented it as the 'trump card' in the debate about the nature of 'a right'.

It is my contention that all rights are the product of imagination, and then defined and bestowed by the winner of 'Hobbesian conflicts', perpetuated by alliances and 'treaties (or sometimes entreaties) between and amongst the individuals. One of these structures is called Anarcho-Capitalism, another is called 'confederation with parlimentary democracy'.

[August1991]

Dear Hugo,

Why don't you believe your own ideology?

I never adopted it as an ideology, I presented it as the 'trump card' in the debate about the nature of 'a right'.

It is my contention that all rights are the product of imagination, and then defined and bestowed by the winner of 'Hobbesian conflicts', perpetuated by alliances and 'treaties (or sometimes entreaties) between and amongst the individuals. One of these structures is called Anarcho-Capitalism, another is called 'confederation with parlimentary democracy'.

<{POST_SNAPBACK}>

It is not clear to me what you mean by "a right". I assume you must mean a property right that is protected against everyone, including the State. I would argue that the State should have the right to take my property without my permission in certain very specified circumstances.

[To justify government on such grounds would be difficult with Hugo so I'll take another route at first in this post.]

Nonsense, it would have equal validity on par with any 'right'. Some people were selling plots on the moon years ago...who 'owns' it? I laid claim to it years ago in an argument with another friend of mine, (when we were both about 9 or 10) but can this make it mine? Do I have to go invade and stick a flag in it to 'own it'?

In short, yes. You can't just say something is yours and hey presto, it is. Do some more research on the concept of homesteading, please.

Homesteading means taking something that, in practice, belongs to no one. Finders, keepers. The problem here is that such a policy encourages people to waste efforts solely to make claims in anticipation of future value.

This argument is a little subtle so let me give a precise example: radio wave lengths. We could merely give ownership to the first person to broadcast on a particular wavelength. (Finders, keepers.) The problem here is that people would start building costly, powerful transmitters for no other reason than to occupy the wavelength. (Stick a flag in it.) Why? Because of the anticipated future value.

Why not create something called the "State" which will sell the wavelength to the highest bidder instead? This avoids the useless transmitter and instead turns it into something of value for the "collective".

----

The State is beneficial for deciding property rights in virgin territory but its greatest benefit is in assisting transactions.

It would wonderful if we could define property rights fully but the problem is that we often cannot - or we cannot trade those rights. In such cases

What cases? Again, a vast assumption of something by no means proven.

You want a case? The light from a streetlamp. It's a heck of alot easier to charge everyone in the street a fixed amount rather than charge anyone a small amount each time they walk by at night.

----

That is that there must be protection for our natural rights. These rights are, in a state of nature, exposed to the possibility of the strong taking from the weak; or, the weak banding together to subdue the strong.

eureka, your opinion shows a fundamental misunderstanding about what markets do. (When they work, markets protect the weak against the strong. In fact, it can be argued that markets are the victory of doves over hawks.) In addition, you seem to have accepted the government's own propaganda that it is there to help the weak against the powerful. Governments don't really do that.

[Guest eureka]

I argue that government also protects the strong against the weak. Democratic government balances the protections in the general interest.

I don't misunderstand markets. Market's left to themselves, do not work and never have. Government must ensure that they do and government must be there to do that. Even Adam Smith understood that and said it.

Markets do not work in themselves simply because there are "strong" and "weak."

[cybercoma]

I argue that government also protects the strong against the weak. Democratic government balances the protections in the general interest.

I don't misunderstand markets. Market's left to themselves, do not work and never have. Government must ensure that they do and government must be there to do that. Even Adam Smith understood that and said it.

Markets do not work in themselves simply because there are "strong" and "weak."

<{POST_SNAPBACK}>

I've been terribly mistaken all along. I always thought when the government intervened in the market bad things happened. See Soviet Union for details.

[Guest eureka]

Yes you have, it seems. See the world's most successful economies for details.

[cybercoma]

Yes you have, it seems. See the world's most successful economies for details.

<{POST_SNAPBACK}>

The United States and their hands off approach for example?

[Guest eureka]

The USA does not have a hands off approach and it is one that could be looked at.

[cybercoma]

The USA does not have a hands off approach and it is one that could be looked at.

<{POST_SNAPBACK}>

Name a country that has a more hands off approach that has failed miserably, so I can get a better understanding.

[Guest eureka]

Since there has been no government with a 'hands -off' approach, except in Hugo's fevered imagination, there is none to be named. Unless you go back to medieval times to find something like it though not quite. All those failed and government increasingly took a role.

[Hugo]

It is my contention that a gov't, in some form, is absolutely vital IF one desires to live other than a 'subsistence-farming hermit with a nuclear arsenal'.

It is my contention that all rights are the product of imagination, and then defined and bestowed by the winner of 'Hobbesian conflicts', perpetuated by alliances and 'treaties (or sometimes entreaties) between and amongst the individuals.

So, Thelonius, essentially you contend that we need a government because it is somehow the right of men to live at something "other than a subsistence-farming hermit with a nuclear arsenal" level, but then tell me that all rights are just opinions, and that is just your opinion.

I ask who died and made you God, so that your opinion is the correct one and needs to be forced on others by violent means? If this were not the case you should really have no objection to the nuclear-hermit state of affairs, because you've told me that your opinions are really no more substantial than your favourite colour. I like the colour blue, however, if you like red I'm not advocating forming a government to ensure that everyone chooses blue.

Homesteading means taking something that, in practice, belongs to no one. Finders, keepers. The problem here is that such a policy encourages people to waste efforts solely to make claims in anticipation of future value.

Who says it is a waste? You may, but those who 'waste' such resources do not feel it is a waste, and it is their effort and capital going in, so, who made you overlord of their labour and possessions?

This argument is a little subtle so let me give a precise example: radio wave lengths. We could merely give ownership to the first person to broadcast on a particular wavelength. (Finders, keepers.) The problem here is that people would start building costly, powerful transmitters for no other reason than to occupy the wavelength. (Stick a flag in it.) Why? Because of the anticipated future value.

So what? Why is this bad? If these transmitters are too costly to justify against the probable return then they won't be built anymore. If they are built, then that means the probable return is worth the investment and risk, therefore, there's no inefficiency here.

Why not create something called the "State" which will sell the wavelength to the highest bidder instead?

Firstly, because there is nothing to indicate that this bidding process will not cost the winning bidder any less than it would have cost him to build a costly transmitter. Secondly, because the State being what it is, it's most likely that it would just sell the wavelength to its sycophants. Think CRTC and Fox News.

The State is beneficial for deciding property rights in virgin territory but its greatest benefit is in assisting transactions.

I'm getting very annoyed with this. Don't just postulate wild ideas and expect me to accept them. Prove it, make an argument, cite an example, but don't tell me we could feed the world if we mined all the cheese out of the moon. There isn't any cheese in the moon!

In future, if you put up any wild and unsubstantiated gross assumptions I will simply ignore them. It isn't worth my time constructing a rebuttal to what is effectively a non-argument.

You want a case? The light from a streetlamp. It's a heck of alot easier to charge everyone in the street a fixed amount rather than charge anyone a small amount each time they walk by at night.

I told you how these problems could be resolved. I'd appreciate it if you'd review and reply to that answer.

I argue that government also protects the strong against the weak. Democratic government balances the protections in the general interest.

What if the general interest is incompatible with minority rights, liberty, etc? What if the majority support a government that exterminates Jews (and, as Murray Rothbard noted, all governments need majority support, even if it's just grudging resignation)?

Government must ensure that they do and government must be there to do that.

The trouble is that once government intervenes in the economy it becomes a player in the economy. Even providing a legal framework is a service and is an intervention. The trouble is that the government is the only player allowed to use violence, and as such will distort and even shut down markets in order to favour itself. Consider that if you dare compete with Canada Post you are a criminal.

[Guest eureka]

The General interest is not the same as the "General Will." The latter may well lead to horrors and has done as we both know.

Is it not fortunate that government is the only player allowed to use violence? Another situation would lead to what most people think is anarchy.

As for Canada Post, there are arguments to be made for a government monopoly in that. Arguments of economic efficiency and general utility and, again, general interest.

[Hugo]

Is it not fortunate that government is the only player allowed to use violence?

No. Just as a grant of monopoly generally leads to stagnation and price-gouging, so a monopoly on violence leads to extortion. Consider how many laws there are on the books today that really punish no transgressions nor avenge any victims, but just serve as glorified shake-downs for the State: motorcycle helmet laws, speeding/drunk driving laws, drug laws, zoning laws, minimum wages, labour regulations, trade protectionism etc. In all of these cases there's no victim and no rights-violation.

As for Canada Post, there are arguments to be made for a government monopoly in that. Arguments of economic efficiency and general utility and, again, general interest.

Well, don't let me stop you making them. But without seeing them I have no more reason to believe they exist than I have reason to believe a large pink elephant is standing behind me.

[August1991]

This argument is a little subtle so let me give a precise example: radio wave lengths. We could merely give ownership to the first person to broadcast on a particular wavelength. (Finders, keepers.) The problem here is that people would start building costly, powerful transmitters for no other reason than to occupy the wavelength. (Stick a flag in it.) Why? Because of the anticipated future value.

So what? Why is this bad? If these transmitters are too costly to justify against the probable return then they won't be built anymore. If they are built, then that means the probable return is worth the investment and risk, therefore, there's no inefficiency here.

That comment, Hugo, is both ignorant and naive.

It is wasteful to undertake any effort with the sole purpose of staking a claim. But furthermore, it is naive to believe there won't be many others who will attempt to do the same and the wasteful efforts will be compounded.

I would agree with you that such situations are sometimes unavoidable because we have no other mechanism for determining what should be of value. But the whole point of a price mechanism, and the reason it is has been so useful, is that it turns the race to be first into a side-profit for others.

We know radiowavelengths and land are valuable. The State should auction them off, and imitate the price mechanism.

Firstly, because there is nothing to indicate that this bidding process will not cost the winning bidder any less than it would have cost him to build a costly transmitter.

Precisely the point, Hugo. Rather than build useless transmitters, the benefit would accrue to the collective via the State.

----

WRT the streetlamp:

I told you how these problems could be resolved. I'd appreciate it if you'd review and reply to that answer.

Where? Like you ddi with the overflight rights? Your answer amounted to:

Do you seriously think a private court would entertain such claims of rights-violations without some express entitlement, by which I mean e.g. the ownership of an air corridor by one airline that was being used by another airline without the former's consent?

Do you mean to say that your argument relies on the hypothetical decision of a hypothetical court?

My point Hugo was: who owns the right to fly a plane over my property? And why do we do determine ownership in such a manner?

I have given you other examples including condominiums, roads, traffic lights, radio. I have yet to see an intelligible explanation that excludes "government" (although you frequently claim that you have provided one).

If it were possible to conduct all transactions, including contingency contracts, through free markets then a case could be made that government would not be necessary. But in the real world, many, many markets do not exist and many desirable transactions do not occur. The costs of the transactions are simply too great given current technology. Hence, the benefit of government.

[theloniusfleabag]

Dear Hugo,

All the hypotheticals bandied about pale in comparison to what is actually happening anyway. How is ostracism going to affect a company like Pfizer or Nike, for example? Without a gov't regulatory body, they would laugh at any attempt to collect arbitrarily inposed fines by the general populace. Pfizer has many copyrights to drugs that would be needed by millions, ostracism would be both impossible and imprudent.

Pfizer

(Warner-Lambert division)

2004

$430,000,000

"Pfizer Inc., the world's largest pharmaceutical firm, agreed yesterday to pay more than $430 million to settle criminal and civil charges that one of its divisions fraudulently marketed a popular drug, Neurontin, for unapproved uses. The company pleaded guilty to charges that its Warner-Lambert division engaged in a widespread, coordinated effort -- offering kickbacks, one-sided education classes and free trips to the Olympics and to Florida -- to encourage doctors to prescribe Neurontin for uses not approved by the Food and Drug Administration. First approved by the FDA in 1993, Neurontin became a major drug, with $2.2 billion of sales in the United States last year; worldwide sales were $2.7 billion, about 6 percent of Pfizer's total revenue of $45.2 billion. Law enforcement officials said yesterday a month's prescription costs about $200 and that about 90 percent of the prescriptions are for unapproved uses. The FDA has approved Neurontin only to treat epilepsy and shingles, but Warner-Lambert promoted it to treat a variety of psychiatric ailments (including bipolar disorder and attention deficit disorder), back pain, migraines and amyotrophic lateral sclerosis (Lou Gehrig's disease), the Justice Department said yesterday... The Pfizer statement said the underlying allegations in the case originated in 1996, before it acquired Warner-Lambert in 2002 and "the allegations and conduct pertain solely to Warner-Lambert practices."... Pfizer agreed to pay a criminal fine of $240 million and $190 million in civil fines to be divided among the states and federal government. It is the second-largest criminal fine ever imposed in a health care fraud prosecution. The largest, $290 million, was assessed in 2001, on TAP Pharmaceuticals, a venture of Abbott Laboratories Inc. and Takeda Chemical Industries Ltd., which was charged with using kickbacks, travel and free goods and services to illegally market its prostate cancer drug, Lupron. In the Neurontin case, law enforcement officials said, Warner-Lambert promoted the drug even when scientific studies showed it wasn't effective and made false or misleading statements regarding its efficacy and FDA approval. The company also paid doctors to allow sales representatives to accompany them while they saw patients, with the salesmen offering advice that was "biased toward the use of Neurontin," the Justice Department said. Warner-Lambert also paid doctors to attend "consultants' meetings" that included expensive dinners, tickets to the 1996 Olympic Games in Atlanta and one-sided presentations about using Neurontin for uses other than those approved by the FDA. The company also used "medical liaisons" who represented themselves -- "often falsely," the Justice Department said -- as scientific experts to promote Neurontin's unauthorized use. It was through one such liaison, David Franklin, that Warner-Lambert's activities first became known. Under the settlement, he will receive more than $24 million under the law that permits whistle-blowers to share the proceeds in successful lawsuits against corporate wrongdoing. Also under the settlement, a $28 million fund will be set up for the states to sponsor a program to provide doctors and consumers with fair and balanced information about drugs..." (Fraud Sold Drug, Pfizer Admits, By Caroline E. Mayer, Washington Post, May 14, 2004; Page E01).

link...http://www.endgame.org/corpfines3.html

Or Nike, for that matter,

Nike

2003

$1,500,000

The [Kasky] suit was originally provoked by a Nike PR campaign that discussed the labor conditions in its overseas manufacturing facilities. However, it eventually evolved into a dispute over whether the US Constitution's First Amendment protections extend to PR efforts. The settlement follows a June decision by the US Supreme Court not to rule on the speech issue. Kasky's lawyers argued among other points that the words of the company's spokespeople should be considered "commercial speech," like advertising, and are therefore not protected by free-speech rights. Nike's legal team asked the court to dismiss the suit on the grounds that the PR campaign enjoyed free-speech protection under the First Amendment. The high court declined to rule on the suit, allowing the case to proceed through the California trial courts. The case was born out of an attempt by Nike to defend itself against accusations that its footwear is manufactured in sweatshops in Asia. The company began a PR campaign to quash those accusations in 1998. Kasky disputed the assertions made in that campaign, and launched his suit on those grounds. The settlement sees Nike admit no liability, but agree to spend $1.5 million on workplace-related issues over the next three years above what it usually spends on such initiatives. The money will go to the Washington, DC-based Fair Labor Association, a workers' rights group. (Matthew Creamer, Nike talks to PRWeek after Kasky settlement, PR Week, Sept 12, 2003).

"Why did Marc Kasky settle his case against Nike for a $1.5 million payment to the Fair Labor Association, a group controlled by Nike and other major shoe manufacturers?... Corporations are given six of the seats on the FLA board, and the FLA charter states that all major decisions require a super-majority of the corporations on the board to be approved... The New York Times reported earlier this month that "other terms of the settlement were not disclosed, and lawyers on both sides declined to say whether Nike had paid Mr. Kasky's legal fees or made other payments."... Discovery in the Kasky case had the potential to open the Nike files to public scrutiny, to document the mistreatment of workers throughout the world, and the flow of money from Nike to public interest groups... And Kasky and his lawyers settle this potential historic case for a $1.5 million donation to a group controlled by the shoe and apparel industry. And now they won't talk about it." (Nike Gets a Pass, by Russell Mokhiber and Robert Weissman, Focus on the Corporation, Sept 22, 2003).

[Hugo]

We know radiowavelengths and land are valuable. The State should auction them off, and imitate the price mechanism.

But you still cannot make a case as to why. Inefficiencies will occur in a market. It is inevitable because perfect information is impossible. However, the State will create far greater inefficiencies. As I have said, the State lacks the mechanisms to ascertain what value is actually placed on the things it auctions off. Its very seizure of these things creates an artificial scarcity that will push prices higher than they would have been in a free market. Therefore, it would actually be net-welfare-decreasing for the State to auction these things off.

Consider, again, radio waves. State controls have restricted the bandwidth and channels available, which drives up prices for the remaining ones. This is an inefficiency: it effectively throws away useful resources. State leasing has resulted in great inefficiencies because companies must waste resources bidding, even if they don't win. State ownership has inevitably resulted in State control, and so companies like Fox News which may deliver what the public wants are shut out in favour of companies like the CBC, which don't. This is another inefficiency: providing a service nobody wants. It is also linked to the tendency for State enterprise to favour its friends over everybody else.

You may argue that none of these State inefficiencies would be the way such State control would have to be, but that is the way it has gone and the empirical evidence goes against you. Marxist theory does not hold up in the face of Soviet reality. There's no reason to imagine that the State would auction anything that it could make more money by leasing.

Where? Like you ddi with the overflight rights?

No, I mentioned the possibilities of bundling.

I have yet to see an intelligible explanation that excludes "government"

You're ignoring me, for some reason. If condos are governments, then so are priests, teachers, corporate managers - heck, everyone is a government, because we all buy things and hire people and when we do so, we tell them what to do.

So, basically, you believe that government is indispensible because every human being is a government. Not much of an argument, is it?

If it were possible to conduct all transactions, including contingency contracts, through free markets then a case could be made that government would not be necessary. But in the real world, many, many markets do not exist and many desirable transactions do not occur. The costs of the transactions are simply too great given current technology. Hence, the benefit of government.

You're wasting my time.