…..THE ONLY FREEDOM INVOLVES CLEAR PROPERTY RIGHTS, TITLES, AND RULES…… KNOWN WELL IN ADVANCE.
One time to prove that banning fractional reserve represented a MINIMISATION of regulation I asked the following questions:
“What would you do when the banks closed their doors?
When do you wind them up?
After two business working days?
Can the banks suspend specie payments?
Do then THEIR debtors have to keep paying back to the banks?
Why would they have to pay back the bank if the bank can suspend paying back their clients?
What are the regulations you propose and why?
When do you call a cop?
And what can the cop do when you call him?
What are the MONETARY IMPLICATIONS of letting things go this far?
Will we have to compensate the poor amongst those that have lost their savings?
And is not that compensation itself AN INITIATION OF FORCE?”
You see in this case having one rule saves you the need to have a whole bunch of other rules. After ducking this reality for as long as they could the answer would come back that it ought all be sorted out through the courts!!!!!!!!?????
The courts. The common law. As if the common law is somehow going to be magically a fair and just way of doing things. You’ve lost all your cash. No chance of getting it back. So you are going to take your broke cashless ass to court.
We are having a big problem with dumb libertarians or people who try to use libertarianism against iteslf. So for example one fellow I know, who favours regulation, government subsidy and control in many theatres, suddenly becomes an anarcho-capitalist, when the topic comes down to deregulating the finance industry and getting rid of fractional reserve. This is a sort of regulation-bigotry wherein one of the few regulations that are actually worthwhile suddenly takes on a great deal of importance in the faux-libertarians mind.
But whats worse is others with a more authentic libertarian bent, but no understanding of monetary economics, are always being tripped up on this matter. There is more than one wrong-headed thing going on here. But one of the things I think is going wrong is the idea that there is something non-compulsary about court judgements. But court judgements in the modern era are the application of brute force.
This doesn’t only come up in fractional reserve. But it comes up all the time in matters to do with infrastructure.
I posed an acid test when it came to infrastructural rules for construction and ownership. I said that if you couldn’t get it done with sole traders alone, it meant you needed to think harder about the rules for privatisation and infrastructure ownership-and-construction. I never once said that all infrastructural properties MUST BE OWNED by sole traders. But somehow they just couldn’t wrap their tiny minds around this simple acid test.
The reaction to that was that it was no problem. Since coroperate law would take care of everything. And any problems could be sorted out in court. Preferably by the common law.
So where is this coming from where the application of common law isn’t brute force? I don’t know who to blame so I might blame some bastardised socialist version of Hayek.
Consider what this means. This is advocacy for cronyism to the highest degree that cronyism can be pushed. And for sure all the people who have advocated this nonsensical point of view have been crony sycophants rather than ever having any sympathy for fairness and capitalism.
What this means is you go into business knowing at the first sign of contention you can be dragged into court and your rich adversary can bankrupt you. So in effect its the ultimate barrier to entry. Since all these court costs would represent overhead of millions of dollars. You have no clear rules. The already rich guys have the very best of barriers to entry. They will have taxeater and court overhead keeping everyone else out.
Sometimes things are so stupid you just wonder where they come from. These are GOVERNMENT-FINANCED COURTS. With government financed police. Backed up by government financed soldiers. How can their judgement not represent brute force?
Over at catallaxy where they represent only the taxeater and the crony (under the membrane-thin guise of being libertarian) the idea was you could even sell off all the roads. You could sell off the roads or gift them, in their view, to current property-holders. Now consider how unfair that is? Because you already own property these crony-lovers are going to give you more arbitrarily. And those who own nothing won’t of course get any damn thing. These are not libertarians these are lunatics.
Next thing you point out that if the road outside your place is owned by others at freehold you would in fact be locked in. Only allowed to move at the sufferance of third parties. So thats no pressure. These crony-sycophants , pretending to be libertarians, say that it would be against corporate law for the company that owned the roads to lock you in, in this way. Sometimes this idiots tale goes down wherein you would be gifted shares while these idiot (patently leftist) taxeaters sold off all this gear that they do not own.
Presumably they would sell off the entire sea as well. And that wouldn’t constitute a blockade in their view since they would have given us all a shareholding. Corporate law would apply so that makes it alright. I even heard one of them talking about the idea that you wouldn’t be blocked off because the common law involves EASEMENTS.
So to move anywhere at all you are going to have to hall your ass into court and take on these huge corporations team of lawyers to get an easement. This is not capitalism. This is the tyranny of government-created corporations they are gunning for. Perhaps they are hoping that some communist government will come along and buy out a controlling interest in all these tyranical blockading corporations.
Corporations are themselves a government creation in the modern world. They may well have their more voluntary antecedents but this is the 21st century. So they cannot really represent true capitalism until we can nail down exactly what their legitimate scope is and which clear rules must be kept and which government inspired regulations must be dropped.
They are a government creation. And insofar as the government behaviour is not in accordance with making very simple and clear boundaries then they ought not be seen as the heart and soul of capitalism.
One complete idiot calling himself Jimmy-The-Spiv reckoned that the roads ought to be all sold off to 13 different mega-giatn corporations. Why 13? Well he didn’t say. But the thing is all these nutters are neoclassical-economics types. Thief-economics as its morphed to in Australia. Thief-economics in contempt of fairness or property rights. Their focus is not on property rights but on static-equilibrium models. So its very easy to see where the 13 comes from. You see 1 is monopoly, 2 is duopoly, 3-7 or so is oligopoly…. So spiv will make it 13 because then we won’t be able to tag it as being oligopolistic. But just imagine how much money you would need to break into this business if there were no clear rules and so all differences had to be worked out in courts.
Why this is all important is that we need clear rules for infrastructural goods construction/ownership and administration. And if we don’t get them we will always have some version of cronyism or socialism or some hybrid of both in infrastructural goods.
And we do need to have private infrastructure. The titles need to be clear and strong but they do not need to be freehold. Why we have to have private infrastructure in the end is that infrastructure becomes disproportionately more important as the economy progresses. So we cannot leave it up to government as much as one might wish to.
The dangerous stupidity of these people is getting in the way of sensible privatisation and the private construction of infrastructure.
Take this talk on privatisation here at ABC UNLEASED.
Nowhere in this screed does Jason show any interest in sorting out clear rules for private sector construction of power generators. Which means that it has to be all done with taxeater initiative or else with extreme amounts of taxeater schmoozing. The latter of course means with high effective barriers to entry.
In fact the economist doesn’t have even any of this in mind. He doesn’t want private concerns to build these things. HE WANTS TO FLOG OFF THE OLD STUFF TO CRONY-TOWN.
So you see the whole focus is on selling the old stuff off. Not creating clear rules so that the new stuff can be built. He refuses to show any understanding of the importance of clear property rights, titles and rules all known in advance. And this is not some hardcore fault of this lone economics graduate. Rather it is a problem with economics graduates in this country more generally. And with people claiming to be libertarians.
We ought not sell off any more infrastructure until our taxeater economists start taking property rights for constructing the new stuff seriously. Or until we can fire them all from any taxeater positions and hire people who can do the job.
Though getting rid of MOST regulation is important to the libertarian program it is not the case that getting rid of ALL regulation is a good thing. We need very clear rights, rules and property titles. In the past we’ve had clear rules for private property at freehold. But we are completely at sea when it comes to infrastructural goods. And therein lies the problem. This is why we will not and cannot get adequate private infrastructural development until we figure this problem out.
Leaving things up to corporate law and the courts is anti-capitalist and anti-liberty. Both corporate law and court judgements represent brute force. Having the courts make up all the rules represents a massive barrier to entry that will lead and has lead to a society based on priviledge and cronyism.
Clear rules, property rights and property-titles are the only way forward to a freer society.