Libertarian claims of govt. Inefficiency

[Unclebananahead]

In the debate I've been having with a right libertarian, he consistently seems to take it as a given that whenever govt. intervenes, or provides goods and services, it's done so inefficiently, thus the argument that its best to privatize everything, and leave everything in the hands of the market. Any assistance in deconstructing this notion would be greatly appreciated.

[Catmatic Leftist]

He's making a strawman argument. He's assuming that communism is when a powerful omnipotent dictator or powerful statist presence takes control of everything.

[Unclebananahead]

He's not just making this into an argument against socialism, but against all state intervention in the working of the market. For instance, he's equally opposed to the 1964 civil rights act, as well as the 'socialism for the wealthy'-style subsidies and bailouts of big business. He argues that the 'too-big-to-fail' firms became too big in the first place because of state intervention.

He further claims that prices of cellular phones, computers, and other electronics are falling because of relatively little government intervention in this area of the economy. He claims that govt. intervention is the reason why healthcare costs are so high, as compared to other goods and services.

[Catmatic Leftist]

How did government intervention have anything to do with the Civil Rights movement? The Civil Rights Act of 1964 did pretty much nothing for African-Americans, and was largely just words on paper. It was the agitation brought forth by Martin Luther King Jr., Malcolm X, Rosa Parks, etc. that ultimately paved the way for change and social progress.

[Unclebananahead]

The civil rights act of 1964 is perceived by libertarians such as Rand Paul (son of presidential hopeful, Ron Paul) as infringing upon a property holder's 'right' to deny service to someone on the basis of race.

[Aurorus Ruber]

The civil rights act of 1964 is perceived by libertarians such as Rand Paul (son of presidential hopeful, Ron Paul) as infringing upon a property holder's 'right' to deny service to someone on the basis of race.

What a terrible position to take. I think it really illustrates the true nature of libertarian thinking that they would argue businesses have a right to discriminate on the basis of race.

[Unclebananahead]

What a terrible position to take. I think it really illustrates the true nature of libertarian thinking that they would argue businesses have a right to discriminate on the basis of race.


They believe, and I believe quite erroneously, that businesses will voluntarily refrain from such behavior out of the pursuit of their own material interests. They claim that a business which refuses service to some segment of the populace on the basis of some arbitrary prejudice such as race, would be deliberately limiting the market access for their goods/services (I.e. reducing the possible number of potential customers), and thereby reducing their profits.

[Savage]

Rightist Libertarians have always reminded me of bratty teenagers running away from home, only to realise they need their parents to surive. I'm not sure how many of them actually believe in 100% privatisation, when arguing with a Minarchist recently he admitted that state intervention was needed to combat market failure in certain areas.

[Amphictyonis]

In the debate I've been having with a right libertarian, he consistently seems to take it as a given that whenever govt. intervenes, or provides goods and services, it's done so inefficiently, thus the argument that its best to privatize everything, and leave everything in the hands of the market. Any assistance in deconstructing this notion would be greatly appreciated.

Fire departments in NY were once private and people/businesses needed a fire insurance mark in order for firefighters to put out the fire. No insurance no help. Needless to say entire cities burned down because of fires started in uninsured homes (fire spreads).

http://en.wikipedia.org/wiki/Fire_insurance_marks

Private roads? There would be toll booths every half mile.

Ayn Rand got government help when she was paying medical bills.

Private military? The golden rule- he who has all the gold makes the rules. Thats not "liberty" thats the ultimate tyranny of capital.

Work place conditions? What were they like before workers rioted in the streets demanding the government to make labor laws? We've all seen what the 'good will' of the capitalist does for workers. History tells the truth.

(just to name a few)

[Revolution starts with U]

^ that's it in a nutshell. Throw all your theory out the window if it doesn't match up with history. History tells the truth.

Government many times is ineffecient. That's why it should be up to the people to decide democratically. Besides, private industry may be more efficient than government... the question is FOR and AGAINST whom?

[gestalt]

The problem with "efficiency" arguments is that they oversimplify reality and often function as a red herring. Most of the time you construct a cost-benefit analysis and weigh the pros versus the cons then act accordingly. However, you can never quantify all of the possible contingencies, they are infinite. Free-marketeers are especially notorious for discounting externalities which affect individuals and groups outside of their purely theoretical "efficient" exchange.


He's not just making this into an argument against socialism, but against all state intervention in the working of the market. For instance, he's equally opposed to the 1964 civil rights act, as well as the 'socialism for the wealthy'-style subsidies and bailouts of big business. He argues that the 'too-big-to-fail' firms became too big in the first place because of state intervention.

He further claims that prices of cellular phones, computers, and other electronics are falling because of relatively little government intervention in this area of the economy. He claims that govt. intervention is the reason why healthcare costs are so high, as compared to other goods and services.

His opposition to the Civil Rights Act likely revolves around a perverted interpretation of "freedom of association." The standard argument is that individuals and businesses should be able to discriminate because this is the "private sphere." Unfortunately there is no such thing as the "private sphere" in reality, businesses require licensing from the government, use government roads, utilities and other services. As you pointed out, it is not in the best interest of the business to discriminate, thus it is a moot point on a number of levels.

Be sure to point out that the vast majority of cellular, computing and electronic technology was either developed by a.) government agencies (DARPA especially) or b.) private agencies receiving government funds for R&D. Ask him to look at any device which he owns and report how many include an FCC label. The government has the right, as per the Constitution, to regulate interstate commerce which a "nationwide network" presupposes.

A myriad of factors influence the high cost of healthcare, including government intervention. Specifically the kind which favors insurance corporations and for-profit medical care over the consumer. In short: the wrong kind of intervention.


The Civil Rights Act of 1964 did pretty much nothing for African-Americans, and was largely just words on paper. It was the agitation brought forth by Martin Luther King Jr., Malcolm X, Rosa Parks, etc. that ultimately paved the way for change and social progress.

It is true that the stock of African-Americans, particularly those in the working class, has changed little in the five decades since its passage. Most of the improvements have been simple window-dressing and not socio-economic in nature. However, minorities are allowed to purchase and rent property without discrimination (in theory), have a jury of their true peers (e.g., not all Caucasian), marry outside their race, etc. due to SCOTUS cases citing the act. Also, without falling prey to the "great individuals" reading of history, if we are going to celebrate civil rights leaders let's not fail to mention A. Phillip Randolph, Bayard Rustin, A.J. Muste (among others) and the hundreds of thousands of individuals they helped to organize.

Here is a great video from Richard D. Wolff on the subject of efficiency, which expands on my point:

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[Unclebananahead]

Gestalt, I think your post cut right to the core of this guy's rhetoric. Every argument he makes is hinged on the presumed superior efficiency of the market.

Here's his latest blather:


Computers, mobile phones, TVs are improving in technology and falling in price all the time. Gov't involvement is minimal in those areas. Health care should be treated just like any other "good". I want health care to have maximum accessibility because it's affordable and not because gov't subsidizes it. You don't see the one area where gov't is not entwined - cosmetic surgeries - spiraling out of control in costs. Anything the gov't gets into, it becomes inefficient, quality drops, and costs rise (if not directly, then through taxation or inflation). The more competition you have, the less concentrated the wealth is. The problem exacerbates when the state intervenes causing moral hazards, malinvestments, unsound business decisions with no risk, encouraging too-big-to-fails. And I'm sure the stats you presented may very well be right. And why would that be? The economy is rife with excessive gov't intervention, regulations, and oversight. Don't fall into the trap of believing we have free markets in this country.

As someone already pointed out, the state and state intervention had a great deal to do with developing a number of these technologies, but I don't really know much about the state's role (or non-role) in the price of healthcare, or this ridiculous sounding claim about cosmetic surgery costing less because of lack of govt. involvement.

[NGNM85]

What I find interesting is when these fake 'Libertarians' go on their tirades about clueless, bloated, plodding government programs that can't do anything properly, they deliberately omit any mention of institutions like the CIA, or the NSA.

[DaringMehring]

Being able to fight that type of person is an important skill.

Whereas big money types may be more or less cynical self-interested defenders of capitalism, the capitalist libertarians are the fanatics who are blinded to any flaws and uphold it as a perfect social structure.

There are various routes you can take, just some quick suggestions --

1- attack the efficiency of businesses. What they are saying is gov't is less efficient than businesses --- so study the ways businesses are inefficient. There are plenty of them.

2- learn counter-examples of well-administered gov't programs.

3- develop an analysis of the ways business and gov't are entwined in a capitalist society, in order to show how gov't does "inefficient" things due to the influence of big money, which help said interests.

4- develop counters in which you show that the person is evaluating the whole situation wrong -- why is "efficiency" the top priority?

[gestalt]

It is common argumentation that I am all-too-familiar with, in my teenage years I was this person, before a healthy dose of market reality.

His latest points are all convenient slight of hand tricks. I already discussed the technology aspect. Cosmetic surgery is elective (or "elastic" in his terms) and priced by another set of factors, if a surgeon was to increase the price of their procedures with or without gov't intervention demand would decrease drastically, while general health and medical care is almost always non-elective (or "inelastic"), meaning people will pay whatever price is required for the service.

History demonstrates that markets trend against competition and distribution of wealth and toward oligopoly/monopoly and concentration, even in those "laissez-faire" days these types often harken back to.

The generalization of "excessive" intervention without citing a single one is all but guaranteed in these cases.

He is correct that the U.S. does not employ a free-market, mainly because such a system is an impossibility.

[Cencus]

Markets are inefficient as corporations have to make a profit to keep investors happy, healthcare is probably the best example I can think of.

Figures I read a few years (if you can be arsed trawling through the million statistics on this you can probably get more accurate & up to date, these ones were late 80s) put UK healthcare spending at 9% of gdp France 13% & the USA at 19%. Even given that most statistics are, well, downright fiddled, this shows a massive disparity even before you factor in the universality of the European healthcare systems and the comparative wealth of the nations involved.

[mikelepore]

In any context of the word, "efficiency" means the amount of output compared to the amount of input. When capitalism supporters talk about desireed results, they mean business owners making profits. When the left refers to desired results, we mean certain qualities of life and happiness, so if the people are oppressed then efficiency is automatically zero. How can we discuss efficiency with someone who doesn't want the same outputs?

[Dimentio]

In the debate I've been having with a right libertarian, he consistently seems to take it as a given that whenever govt. intervenes, or provides goods and services, it's done so inefficiently, thus the argument that its best to privatize everything, and leave everything in the hands of the market. Any assistance in deconstructing this notion would be greatly appreciated.

In general, government services are constructed with inherent inefficiency. That is because when the private sector, due to increased technological efficiency is laying off people, governments have responded with hiring very many bureaucrats. They are also using a model where a department which has good house-holding of money gets their budget slashed the next year, which could mean lay-offs, which means constant expansion.

So it is ultimately a monetary problem.

At the same time, cut-downs generally affect nurses, teachers and those public employees who do actual work, rather than the bureaucrats.

State-owned companies are generally quite good for the income of the state. In both Sweden and France, they have been quite efficient.

[ExUnoDisceOmnes]

How can you POSSIBLY hope to compare the actions of a state run by corporation and in the interest of profit (which we've proven is ineffective) with the actions of a "state" run by the PEOPLE.

If anything this strengthens our argument. That's EXACTLY why we want to abolish the state as it currently exists.

[Red Commissar]

This is one of the things they go to a lot because it's one of the fields that have relevance to the population. People you see tend to have qualms with the efficiency of public service. They might complain about the lines at the DMV, or how long it took to process a claim with the police, or public sector workers (street cleaners, trash, etc) slack on the job. It's not just a Libertarian argument but is fairly common in Republican chatter about "big government" and is one that most people have some negative experience with.

Unfortunately they use this more as a means to push privatization which doesn't usually fix things for people who rely on social services the most.

[Psy]

This is one of the things they go to a lot because it's one of the fields that have relevance to the population. People you see tend to have qualms with the efficiency of public service. They might complain about the lines at the DMV, or how long it took to process a claim with the police, or public sector workers (street cleaners, trash, etc) slack on the job. It's not just a Libertarian argument but is fairly common in Republican chatter about "big government" and is one that most people have some negative experience with.

Unfortunately they use this more as a means to push privatization which doesn't usually fix things for people who rely on social services the most.

What these people ignore is the inefficiency in the private sector for example no one sees dealing with a cable company any better a experience then the a government agency. They also ignore that all workers are alienated from their work thus comes across as "slackers" simply because their apathetic towards their job.