Relay-Version: version B 2.10 5/3/83; site utzoo.UUCP Path: utzoo!linus!decvax!cca!ima!inmet!nrh From: nrh@inmet.UUCP Newsgroups: net.politics Subject: Re: Orphaned Response - (nf) Message-ID: <1827@inmet.UUCP> Date: Fri, 23-Nov-84 01:15:09 EST Article-I.D.: inmet.1827 Posted: Fri Nov 23 01:15:09 1984 Date-Received: Sat, 24-Nov-84 05:42:54 EST Lines: 134 #R:ucbcad:-277800:inmet:7800184:177600:6333 inmet!nrh Nov 21 06:07:00 1984 >***** inmet:net.politics / ucbcad!faustus / 1:02 pm Nov 17, 1984 >Sure, >economics happens all the time, but the question is whether it happens in >the way we want it to happen. In a free market, economics happens PRECISELY as "we" want it to happen, given the constraints of limited resources. This is because the market's character is determined by its inputs, and a free market by the choices of its participants. > >>>> 4. Power corrupts, either by attrition (the people with power become >>>> corrupt) or by attraction (corrupt people attempt to gain that >>>> power). >>> >>> True, but the problem is, what system is least corruptable? In a >>> system where the government didn't have most of the power then >>> a few strong individuals would eventually get it all, and they >>> would probably be more corruptable than the government we have now. >> >> No, Wayne. (I note in passing your curious phrase: "where the >> government didn't have most of the power") In a system where the >> government cannot be used by the rich to keep the poor from becoming >> rich, economic power tends to spread out. I'd love to hear the basis you have >> for believing that a few strong individuals would get it all. > >In the late 19th century, the government excercised very little control >over the economy, and a few people got all the money. This happened all >throughout the Industrial Revolution, and only ended when the government >took an active part in regulating the economy and private enterprise. > Wayne -- this is simply NOT true. I suggest you check out (for example) Milton Friedman's discussion of railroad collusion (impossible before the fares were regulated). >> This is MOST interesting. The notion that government is the only way >> to prevent bombings is one that I suggest you argue with Pinkerton. > >Oh, you are advocating private armies to protect businesses. It is a very >short step from protection to active harassment of competitors, and before >long you have a small private war on your hands. Yes. Those small steps -- marijuana to heroin, necking to nymphomania, private defense guards to private armies. > >> > You can make an awful lot more money in the private sector than >> > in government, >> >> Not so. One makes the most money being closely associated with the >> government, though not on the government payroll, I admit: >> >> The largest owners of land were the emperors, the relatives of >> emperors, and the intimate associates of emperors. >> Livia, wife of Augustus and mother of Tiberius, became the >> largest property holder in the Roman Empire. It is said that in >> terms of acreage owned, she was the largest private landowner in >> the history of the world. >> [ Max Shapiro, >> "The Penniless Billionaires" >> pg 50] >> A little more recently, Hugo Stinnes assembled the largest industrial >> conglomerate in history. He did it with the collusion of the 1920's >> German government, which supplied him with low-interest loans >> (actually, its more complex than that, but it's what happened) >> during a period of hyperinflation. In the last >> nine months of 1923, the Stinnes concern made a PROFIT of over >> 428 QUADRILLION marks. His PERSONAL estate was estimated to be >> over $1 billion in 1923 (about 4 octillion marks). He was >> a member of the Reichstag. > >Please give contemporary examples of American millionaires getting rich >through the government, please. > Find a copy of "Reason" magazine -- December, 1984. The cover story, "Welfare for the Well-Heeled" documents the economic effects of "industrial development bonds" (IDB's). A brief excerpt: A fundamental purpose of IDB's is to enable businesses to finance projects that otherwise wouldn't be done. Yet some of Texas's richest business people get the financing. In the Dallas area, the world's biggest real estate developer, Trammell Crow, quickly saw the value of the tax-exempt bonds. In 1980 he got $3.5 million to build a warehouse and distribution center in suburban Carrollton. A year later, he used $9.4 million worth of IDBS to build a film and television studio in the posh Las Colinas development of Irving. Seventy-year-old Crow, a folksy, self-made multi-millionaire who praised the spirit of free enterprise when the Republican national convention came to town this year, does more than a billion dollars' worth of real estate deals a year -- but still goes to Texas development commissions, hand extended, for cheap credit. .... In the city of Dallas, multimillionaire Ray Hunt, son of the late right-wing billionaire oilman H.L. Hunt, persuaded the Dallas city council to declare a high-rent block in downtown Dallas "blighted" so he could use $1.5 million worth of IDBS to build an underground parking garage with a park on top. >> > (except >> > for the most ruthless, who establish monopolies and get incredibly >> > rich). >> >> Now this is a very often held, but quite puzzling idea. Certainly >> if one COULD establish a monopoly, one would. BUT -- find one. One >> NOT backed by government, regulated by government, encouraged by >> government. One that stays around for a long time. >> >> Let me know if you find one. I'm still looking. In the meantime, >> concede the monopoly point -- there's almost no indication that they >> are stable short of government intervention. For backing, see >> "Machinery of Freedom", by David Friedman. I'm also trying to >> get hold of a book called "Uncle Sam the Monopoly Man", but >> I haven't read it. >> To anticipate you: The phone company is not a natural monopoly, and was >> facing severe competition when it formed (you'll find reference for this >> in a Time magazine article written about the Bell breakup at about the >> time the breakup took effect). > >During the Industrial Revolution, again, there were numerous monopolies >that disappeared only when the government passed anti-trust laws. >Now the government does support some monopolies, like the Postal Service, >and I will agree with you that it should stop this. But without >government intervention, monopolies are inevitable. I am STILL waiting for a list of these monopolies. Remember -- they had to evolve without the use of government, and be stable.