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[EveryZig]

I would agree that governments are inefficient and forcing people to do things is unethical, but I still say it is the lesser evil compared to not having a government. The core problem of the libertarian efficiency argument is that it is based on a fundamental misunderstanding of what efficiency actually is. A process is not simply 'efficient'; it is efficient for a specific set of objectives and constraints. And the objectives of the market rarely include the best interests of the majority of people. That road is probably not worth the libertarian's money no matter how expensive or cheap it is, because he has no reason to include the locals' well-being in his objectives.

[SalmonGod]

Good point.  The market is extremely inefficient at promoting equality.

[Leafsnail]

Take roads: the government provides roads, but the libertarian asks "Are these roads as efficient in cost and high quality as they could possibly be for my money's worth?" and comes to the conclusion that he can never know for sure because the government takes money that would otherwise go to something else (say, railways or a different kind of road) and crowds out competition because it doesn't need to satisfy consumer demand in the process.

On the other hand, recorded history.  Can you give an example of a country where modern infrastructure magically sprung up from the free market without the government providing most of it?

[Descan]

I think in Canada the government funds the construction but private companies bid for the contract to build the roads.

[GreatJustice]

Take roads: the government provides roads, but the libertarian asks "Are these roads as efficient in cost and high quality as they could possibly be for my money's worth?" and comes to the conclusion that he can never know for sure because the government takes money that would otherwise go to something else (say, railways or a different kind of road) and crowds out competition because it doesn't need to satisfy consumer demand in the process.

On the other hand, recorded history.  Can you give an example of a country where modern infrastructure magically sprung up from the free market without the government providing most of it?

Depends on what you mean by modern infrastructure. The US up until the mid 19th century basically had no government providing things such as roads, yet roads were built by private entities instead. For example:
(Large image)

Spoiler (click to show/hide)

Mind, roads weren't quite as essential during the period before the US government became involved (between 1910 and 1920), but there was certainly no huge infrastructure problem in the US before then. Furthermore, because roads weren't subsidized, methods of "public" transportation were quite a bit more common.

Trains WERE heavily subsidized, but the subsidized train lines were hugely inefficient because they were subsidized by length, meaning they built exceptionally long lines with poor material to squeeze the government for support quite often. They also largely abused government support in stealing land from farmers and native Americans in the process, with few exceptions.

Besides that, gas, electric, and telephone companies were very abundant before US government regulation, and the initial "pioneers" (AT&T, etc) were rapidly losing market share by 1900. Cities like Baltimore had many separate gas and electric companies each, and prices were quite competitive. In general, those industries consolidated when the government (local or federal in this case) decided to consolidate such companies in the interest of "efficiency" or else provided a few with privileges over the rest.

Just to get this out of the way, though, the 19th century, even in the US, was not a period which libertarians would call "ideal". Regulations, controls, and taxes were lower, but cronyism was more blatant among other things.

I would agree that governments are inefficient and forcing people to do things is unethical, but I still say it is the lesser evil compared to not having a government. The core problem of the libertarian efficiency argument is that it is based on a fundamental misunderstanding of what efficiency actually is. A process is not simply 'efficient'; it is efficient for a specific set of objectives and constraints. And the objectives of the market rarely include the best interests of the majority of people. That road is probably not worth the libertarian's money no matter how expensive or cheap it is, because he has no reason to include the locals' well-being in his objectives.

Now here is a legitimate criticism.

However, you seem to think of the "market" as a monolithic entity existing entirely for the purpose of profit. The market is simply a very large group of people trading things they have but don't want for things they don't have and want. It doesn't serve a "majority" of people per se, but it will generally trend towards serving each individual in his or her way.

For example, Jim in this hypothetical libertarian New York obviously doesn't much care about building a road in the middle of Kansas (unless he owns a company there or has relatives there or something), so he probably wouldn't spend money on roads in Kansas. However, Joe in Kansas certainly does want a road in Kansas, and would likely pay to use it. Unless Joe lives literally in the middle of nowhere, there would probably be a profit making a road, or at least a transportation system of some kind,  in this area. Now at this point, there are any number of solutions. If enough people in the area want a road, they could pitch in some money, hire some contractors, and form a non-profit road company that would be funded either through donations or through paying a toll for passing through. Alternatively, an entrepreneur could see a chance to make some money and make the road himself and then it would also charge a toll, but enough to cover the entrepreneur's expenses plus some profit.

Naturally, the road wouldn't be of the finest quality were it covering an area with low population, but then it would have to be good enough (and cheap enough) for the area, or else someone else would see a chance and try to make their own road instead. With the government making the roads, cost and quality aren't necessarily as immediate concerns. Small towns could have unnecessarily lavish, excellent roads that no one uses while well traveled roads could spend months or years in poor condition without much punishment for those in government.

Good point.  The market is extremely inefficient at promoting equality.

Equality, yes. The market generally won't promote equality, since it has more of a tendency to promote wealth creation. However, it certainly would allow for more social mobility in the long run, which is something that actually is desirable.

I think in Canada the government funds the construction but private companies bid for the contract to build the roads.

Which isn't really ideal, since that's a form of private-public partnership. Such things are quite common in the UK, and generally result in the "competing" companies trying to squeeze every penny out of the government for as low a price as possible. Since the companies don't actually own what they're building/operating, quality is a fairly low concern. Just look at British Rail.

[Leafsnail]

Depends on what you mean by modern infrastructure. The US up until the mid 19th century basically had no government providing things such as roads, yet roads were built by private entities instead. For example:

Mid-19th century is not modern by any stretch of the imagination.  I think I explained this to you before.  Not least because there was no mass automobile use.

Mind, roads weren't quite as essential during the period before the US government became involved (between 1910 and 1920), but there was certainly no huge infrastructure problem in the US before then. Furthermore, because roads weren't subsidized, methods of "public" transportation were quite a bit more common.

Trains WERE heavily subsidized, but the subsidized train lines were hugely inefficient because they were subsidized by length, meaning they built exceptionally long lines with poor material to squeeze the government for support quite often. They also largely abused government support in stealing land from farmers and native Americans in the process, with few exceptions.

Besides that, gas, electric, and telephone companies were very abundant before US government regulation, and the initial "pioneers" (AT&T, etc) were rapidly losing market share by 1900. Cities like Baltimore had many separate gas and electric companies each, and prices were quite competitive. In general, those industries consolidated when the government (local or federal in this case) decided to consolidate such companies in the interest of "efficiency" or else provided a few with privileges over the rest.

Nice original research I guess?  These examples are so vague I can't even google them.  Also not modern.

Just to get this out of the way, though, the 19th century, even in the US, was not a period which libertarians would call "ideal". Regulations, controls, and taxes were lower, but cronyism was more blatant among other things.

Give me a time period and country that was close to this "ideal" then.

[Flying Dice]

Take roads: the government provides roads, but the libertarian asks "Are these roads as efficient in cost and high quality as they could possibly be for my money's worth?" and comes to the conclusion that he can never know for sure because the government takes money that would otherwise go to something else (say, railways or a different kind of road) and crowds out competition because it doesn't need to satisfy consumer demand in the process.

On the other hand, recorded history.  Can you give an example of a country where modern infrastructure magically sprung up from the free market without the government providing most of it?

Depends on what you mean by modern infrastructure. The US up until the mid 19th century basically had no government providing things such as roads, yet roads were built by private entities instead.

They were also relatively insignificant and small-scale affairs; turnpikes of the 1800s are hardly comparable to, say, the interstate highway system (which would almost certainly never existed without a national government). I've also heard it put best like this: During that period of time, the corporate form had a much different ethos, one oriented more on serving the community rather than generating profits. In other words, almost exactly the opposite of corporations (and markets as a whole) in the modern world. Incidentally, that is one of the main roles of government.

Mind, roads weren't quite as essential during the period before the US government became involved (between 1910 and 1920), but there was certainly no huge infrastructure problem in the US before then. Furthermore, because roads weren't subsidized, methods of "public" transportation were quite a bit more common.

Trains WERE heavily subsidized, but the subsidized train lines were hugely inefficient because they were subsidized by length, meaning they built exceptionally long lines with poor material to squeeze the government for support quite often. They also largely abused government support in stealing land from farmers and native Americans in the process, with few exceptions.

Besides that, gas, electric, and telephone companies were very abundant before US government regulation, and the initial "pioneers" (AT&T, etc) were rapidly losing market share by 1900. Cities like Baltimore had many separate gas and electric companies each, and prices were quite competitive. In general, those industries consolidated when the government (local or federal in this case) decided to consolidate such companies in the interest of "efficiency" or else provided a few with privileges over the rest.

Just to get this out of the way, though, the 19th century, even in the US, was not a period which libertarians would call "ideal". Regulations, controls, and taxes were lower, but cronyism was more blatant among other things.

Steamers were actually in use a decent length of time before commercial railroads really came into their own, and were arguably a more important form of transportation up until around the 1830s. Incidentally, I don't see how government is to blame for inefficiencies and corruption caused by the absurdly large influence of the business magnates and trusts of the era. Do note that pretty much as soon as the government was out of the hands of the wealthy businessmen, it (in no small part thanks to Teddy Roosevelt) went about instituting progressive reforms and breaking up the monopolies that had allowed such an incredible degree of corruption in American business.

Government is only as good as the people controlling it; when the people controlling it are the same people abusing both it and the market for their own gain, it naturally follows that it isn't much good at all.

It's rather funny that you say that about libertarians not finding the late 1800s to be ideal; what's not to like? You've got a free market, weak government, taxes are low, and practically everything useful that gets done is done so by small groups of people with no other choice. You can't very well advocate a worldview without also advocating the result. Such an ideal is (perhaps) feasibly in small, pre-industrial communities. Large, modern nations? Not so much.

I would agree that governments are inefficient and forcing people to do things is unethical, but I still say it is the lesser evil compared to not having a government. The core problem of the libertarian efficiency argument is that it is based on a fundamental misunderstanding of what efficiency actually is. A process is not simply 'efficient'; it is efficient for a specific set of objectives and constraints. And the objectives of the market rarely include the best interests of the majority of people. That road is probably not worth the libertarian's money no matter how expensive or cheap it is, because he has no reason to include the locals' well-being in his objectives.

Now here is a legitimate criticism.

However, you seem to think of the "market" as a monolithic entity existing entirely for the purpose of profit. The market is simply a very large group of people trading things they have but don't want for things they don't have and want. It doesn't serve a "majority" of people per se, but it will generally trend towards serving each individual in his or her way.

For example, Jim in this hypothetical libertarian New York obviously doesn't much care about building a road in the middle of Kansas (unless he owns a company there or has relatives there or something), so he probably wouldn't spend money on roads in Kansas. However, Joe in Kansas certainly does want a road in Kansas, and would likely pay to use it. Unless Joe lives literally in the middle of nowhere, there would probably be a profit making a road, or at least a transportation system of some kind,  in this area. Now at this point, there are any number of solutions. If enough people in the area want a road, they could pitch in some money, hire some contractors, and form a non-profit road company that would be funded either through donations or through paying a toll for passing through. Alternatively, an entrepreneur could see a chance to make some money and make the road himself and then it would also charge a toll, but enough to cover the entrepreneur's expenses plus some profit.

Naturally, the road wouldn't be of the finest quality were it covering an area with low population, but then it would have to be good enough (and cheap enough) for the area, or else someone else would see a chance and try to make their own road instead. With the government making the roads, cost and quality aren't necessarily as immediate concerns. Small towns could have unnecessarily lavish, excellent roads that no one uses while well traveled roads could spend months or years in poor condition without much punishment for those in government.

Saying something is so doesn't make it so. Trying to pretend that a single person of average wealth has comparable market strength to a single multimillionaire is absolutely absurd. The market is not monolithic simply because there is no single individual with the vast majority of the wealth in the system. What it is, however, is a plutocracy. When the vast majority of the wealth is concentrated in the hands of a small group of individuals, the market tends towards things which benefit one of those few individuals. Misinterpreting one of those market actions that coincidentally benefits some "normal" people as the market functioning properly is akin to claiming that there is a plague because someone in the city angered Zeus.

Once again, you are approaching things from the attitude that the entire world is composed of tiny, insular communities connected by nebulous agents of the free market who provide funding for worthy projects. Maybe you were right three hundred or four hundred years ago. Today? Not so much. You can clap your hands as much as you want, but that won't make Ayn Rand right, either rationally or ethically.

Good point.  The market is extremely inefficient at promoting equality.

Equality, yes. The market generally won't promote equality, since it has more of a tendency to promote wealth creation. However, it certainly would allow for more social mobility in the long run, which is something that actually is desirable.

Social mobility is the load of crap that has been used to justify exploitation of the working class for as long as it has existed. I normally don't lean this far towards Marx, but geez. Do you know why poor, white sustenance farmers in the antebellum South supported slavery, despite not being able to afford slaves? Because the plantation owners instilled false hope that someday they would be able to buy a slave and live an easier life. The rich leading the poor on with promises that they, too can make it big is as old as the shift from noble/serf to business magnate/factory worker. Every generation you have one or two people who do genuinely make it big, usually through some latent talent. The vast majority of the wealthy people in the world were born to wealthy families. Most of the most prominent self-made million- and billionaires tend to be the ones who do the most charitable work.

In short, social mobility would be a worthy thing if it wasn't largely a load of crap invented to pacify the working class. The bottom line is that in any closed system (such as our world) there is a limited amount of wealth, a limited number of resources. The wider the disparity between the resource distribution, the fewer people who can improve their condition. It is criminal that some people are more wealthy than some nations and that they waste that wealth on utterly trivial things. Not legally criminal, but ethically and morally evil. Come back to me when every person in the world has a roof over their head and food in their stomach, then maybe we can talk about social mobility. Until then, every bit of Smithian and Randian propaganda only exists to preserve the wealth and power of those who already possess it.

I think in Canada the government funds the construction but private companies bid for the contract to build the roads.

Which isn't really ideal, since that's a form of private-public partnership. Such things are quite common in the UK, and generally result in the "competing" companies trying to squeeze every penny out of the government for as low a price as possible. Since the companies don't actually own what they're building/operating, quality is a fairly low concern. Just look at British Rail.

It would, after all, be much better to cut out the private contractors altogether and do things properly. Government is a representation of every individual it governs, and as such has the welfare of each of those individuals as its first and most important goal. Any government acting in a way that is not in accordance with this is a flawed one. Things done by private individuals and companies are inherently flawed as they are driven by profit; government at least has the potential to be driven by the interests of its constituents. And for a final note, please don't start in on that BS about equating philanthropy to corporations rather than noblesse oblige, or worse yet trying to suggest it as a workable substitute for government.

tl;dr: Government is flawed, certainly, but has far more potential than private enterprise in terms of promoting the well-being of society as a whole and the individuals which compose it. As if that was a surprise.

[Pnx]

There's always issues with penny pinching and cost cutting no matter how it's done, and there's always the issues of corruption and illegitimate practises. Unfortunately there doesn't seem to be a way to guarantee everyone will do the job they're supposed to do, do it well, and not rampantly rake money into their pockets.

[10ebbor10]

There's always issues with penny pinching and cost cutting no matter how it's done, and there's always the issues of corruption and illegitimate practises. Unfortunately there doesn't seem to be a way to guarantee everyone will do the job they're supposed to do, do it well, and not rampantly rake money into their pockets.

Well, since all humans are flawed, all human organisations will be too.

Therefore, all hail our robotic overlords.

On topic, let's make a small comparison between the USA(pretty much free economy) and Belgium(Quite a lot of governement interference, and I live there).

Things of note:

Health expenditure per percentage of GDP are higher in USA than in Belgium. Which is strange, since Health insurance is governement backed in Belgium, and mandatory. Also note that American GDP per capita is quite a lot higher.
Belgium hospitals and such are better equiped, having almost twice the amount of beds availble per capita as in America
Education expenditures/ GDP are just slightly larger in Belgium.
Youth unemployement is about 4% higher in Belgium.

Onward to economy

Nothing special to note, exept that Belgian economy grows slightly faster than the American one.
Belgian unemployement is about 2% lower than American unemployement.
Population below the poverty line is near equal.
Investement in Belgium is higher
Belgium governement deficit is only half as big, when calculated in %
48.6% tax rate of GDP as opposed to 15.3%
Public dept is worse in Belgium, nearing 100% of GDP
Inflation is a bit lower in US

I could continue, but I got bored. So no conclusion yet.

[Reelya]

The problem with the "just look at British Rail" argument against public transport, is that it's still a free market for the consumer, you can drive a car, or take a private taxi or a bus service in the UK, yet people CHOOSE to ride on British Rail, then complain about it.

So, it can't be all that inefficient. Like GreatJustice's "just good enough" roads built by private enterprise (by the way, i'd like to see the death tolls on those private roads), British Rail is "just good enough" to get people from point A to point B for the minimal cost. Luxury it isn't, but you'd PAY for that luxury, and nobody WANTS to pay more than the bare minimum. British Rail would STILL have a "first class" if anyone would pay more than minimum.

I really lol'd at the "just build another road" concept for when the "road company" either raises the toll too high, or leaves the existing road as a deathtrap covered in potholes. What happens when you run out of space for roads? Who pays for the warning signs that the cheapskate road company didn't clean up after an accident because the cost of cleanup and repairs would exceed the value of the tolls, and they could get more profits by investing the repair money elsewhere, and leaving the road decrepit?

An agent who ONLY cares about the direct profit they can make off people who travel down that road has the wrong "economy of scale", because there is a lot of economic activity that is promoted by the existence of that road that does not DIRECTLY benefit the owner of the road or the person driving down the road - e.g. profits earnt by other companies because people could use the road to access markets, employees driving to work. The "owner" of a single piece of road maximizing their profits can bottleneck profits for other players. Raising tolls on the road could stop employees being able to afford to drive to a job. So it's not just people who DIRECTLY drive down that road who benefit from the road is it? Every business connected to that road benefits. Tolls do not capture this relationship.

With roads, what are you going to have? A city-wide road monopoly - totally defeating the whole point of "free market", or massive redundancy and/or toll booths on every corner? Either way, it makes every other aspect of commerce in the city less efficient doing things this way. Especially because there can be major road accidents, do you want clogged toll booths blocking fire trucks, ambulances, police (all of whom would be run by competing private firms btw with no coordination).

Let's have 15 fire services, 15 police services and 15 ambulance services per city as well, all unregulated. And let them refuse to help you if you didn't pay a membership fee to each one. Just hope the one you're signed up with turns up when needed, or they'll have to phone around before they can scrape your sorry ass off the road Jimbob built. Hell it was your fault hitting that pothole, you didn't read the fine-print on the roadsigns.

[palsch]

Erm, I do hope all this chatter about British Rail is aware of it's 1994 privatisation. I mean, I ride British trains every week, and while some most of them are old BR rolling stock they certainly aren't run by BR any more.

[Ancre]

Population below the poverty line is near equal.

Just a quick note on that, if Belgium is anything like France (where I live), then "poverty" isn't quite the same in Belgium and in the US, and it'll be interesting to compare both situations more extensively.

On top of my head, unlike the US, if you're poor in Belgium you still can afford to go to the hospital, you can forego having a car and use the public transportation, etc, you actually have access to a lot of services, paid by the government, that you couldn't really afford otherwise. In the US, all that falls on your shoulders.

Also, there's all the social laws and protection. Unemployment indemnities are higher, last longer, and low-pay jobs are better in many regards (vacations?). It's also more complicated to get fired. In the US, not only do you have to pay everything yourself, but your income is much less secure, and if you lose it, things can get ugly real quick.

So being poor doesn't quite mean the same thing in the US and in Belgium. Poverty is also not always defined in the same way - different governments have different ways to measure it. (Or am I saying something stupid and "poverty line" is an international standard ?). Anyways, I thought it'd be an interesting thing to note.

[GreatJustice]

There's always issues with penny pinching and cost cutting no matter how it's done, and there's always the issues of corruption and illegitimate practises. Unfortunately there doesn't seem to be a way to guarantee everyone will do the job they're supposed to do, do it well, and not rampantly rake money into their pockets.

Well, since all humans are flawed, all human organisations will be too.

Therefore, all hail our robotic overlords.

On topic, let's make a small comparison between the USA(pretty much free economy) and Belgium(Quite a lot of governement interference, and I live there).

Things of note:

Health expenditure per percentage of GDP are higher in USA than in Belgium. Which is strange, since Health insurance is governement backed in Belgium, and mandatory. Also note that American GDP per capita is quite a lot higher.
Belgium hospitals and such are better equiped, having almost twice the amount of beds availble per capita as in America
Education expenditures/ GDP are just slightly larger in Belgium.
Youth unemployement is about 4% higher in Belgium.

Onward to economy

Nothing special to note, exept that Belgian economy grows slightly faster than the American one.
Belgian unemployement is about 2% lower than American unemployement.
Population below the poverty line is near equal.
Investement in Belgium is higher
Belgium governement deficit is only half as big, when calculated in %
48.6% tax rate of GDP as opposed to 15.3%
Public dept is worse in Belgium, nearing 100% of GDP
Inflation is a bit lower in US

I could continue, but I got bored. So no conclusion yet.

Healthcare is hardly a free market in the US, nor does the US constitute a radically more free market country than Belgium.

It is worth noting, however, that American citizens have notably more purchasing power and more expendable income than most Europeans.

The problem with the "just look at British Rail" argument against public transport, is that it's still a free market for the consumer, you can drive a car, or take a private taxi or a bus service in the UK, yet people CHOOSE to ride on British Rail, then complain about it.

I think you missed my argument here. I'd advise you look up "British Rail" sometime, because they aren't really "public transit" anymore. Also, assuming it was, you still don't get the choice in whether you PAY for it or not, only whether you use it.

So, it can't be all that inefficient. Like GreatJustice's "just good enough" roads built by private enterprise (by the way, i'd like to see the death tolls on those private roads)

They'd have to practically plant land mines on their roads to beat the present death tolls from American roads.

I really lol'd at the "just build another road" concept for when the "road company" either raises the toll too high, or leaves the existing road as a deathtrap covered in potholes. What happens when you run out of space for roads? Who pays for the warning signs that the cheapskate road company didn't clean up after an accident because the cost of cleanup and repairs would exceed the value of the tolls, and they could get more profits by investing the repair money elsewhere, and leaving the road decrepit?

Who's going to take a road covered in potholes, or that charges extortionate fees? It would go out of business rather fast, especially considering the fact that roads aren't the only kind of transportation.

An agent who ONLY cares about the direct profit they can make off people who travel down that road has the wrong "economy of scale", because there is a lot of economic activity that is promoted by the existence of that road that does not DIRECTLY benefit the owner of the road or the person driving down the road - e.g. profits earnt by other companies because people could use the road to access markets, employees driving to work. The "owner" of a single piece of road maximizing their profits can bottleneck profits for other players. Raising tolls on the road could stop employees being able to afford to drive to a job. So it's not just people who DIRECTLY drive down that road who benefit from the road is it? Every business connected to that road benefits. Tolls do not capture this relationship.

So? The businesses could buy the road. The people who put it in place would have had to make agreements with the people along the side of the road as to which was road and which was owned by the people living there.

With roads, what are you going to have? A city-wide road monopoly - totally defeating the whole point of "free market", or massive redundancy and/or toll booths on every corner? Either way, it makes every other aspect of commerce in the city less efficient doing things this way. Especially because there can be major road accidents, do you want clogged toll booths blocking fire trucks, ambulances, police (all of whom would be run by competing private firms btw with no coordination).

Because competing firms wouldn't share information to keep some level of order 

Let's have 15 fire services, 15 police services and 15 ambulance services per city as well, all unregulated. And let them refuse to help you if you didn't pay a membership fee to each one. Just hope the one you're signed up with turns up when needed, or they'll have to phone around before they can scrape your sorry ass off the road Jimbob built. Hell it was your fault hitting that pothole, you didn't read the fine-print on the roadsigns.

Most fire services are volunteer. Bit of a simplification, here.

[scriver]

It is worth noting, however, that American citizens have notably more purchasing power and more expendable income than most Europeans.

On paper, perhaps, but not in practice. Most Europeans don't have to put aside huge amounts of money for healthcare and their children's education.

Who's going to take a road covered in potholes, or that charges extortionate fees? It would go out of business rather fast, especially considering the fact that roads aren't the only kind of transportation.

Everybody who has to go anywhere without making long detours? Or do you envision some sort intrastructural landscape where several roads, owned by different road companies, that all go to the same places, lie right next to one another? Because that would never happen.

[Leafsnail]

But you just said that America is not libertarian at all so the failings inherent in its systems can't be used against it (even for this 19th century paradise you keep going on about)!  It's like it's an example of a libertarian country only when you want it to be.