Has libertarianism ever been tried in the real world?

[psychictv]

And those countries tend not to be very free market either, as a matter of fact.

Since this is a general statement, the general answer is that the objectionable factors exist because those countries aren't free markets the way the libertarians envision them.

So you both would argue that there is some other regulation of the market that encourages the child labor? Can you point to an example of what that might be? What regulation could be removed which would reduce child labor? You can choose any example you wish, although the U.S. during the industrial revolution might be a good example, since Galileo seems to think that was a relatively libertarian period.

 

[Ziggurat]

So you both would argue that there is some other regulation of the market that encourages the child labor? Can you point to an example of what that might be?

It's not specific regulations, but general corruption in government, which is very anti-free market. And yes, by stifling economic growth, such corruption indeed encourages child labor. And worse.

You can choose any example you wish, although the U.S. during the industrial revolution might be a good example

A period of time when conditions were nasty for MANY people, including children who did not work in factories. And why do children work in factories? Either because they were forced to (not acceptable to libertarians) or because the alternatives are worse. Simply removing the option to work in a factory doesn't improve anything. The general improvement of standards of living, not simply the dictates of government, are the reason we don't face such problems today.

 

[volatile]

Government corruption? That's what you think causes child labour? Seriously?

Can you expand on that mechanism, in detail? Spell out the chains of cause and effect for me.

 

[psychictv]

I would also like to return to an earlier point:

"Protect capital but not labor?" Regulations against stealing and murder and so on protect everyone and allow people to exercise their freedom and live their lives, in addition to allowing a market to exist. I reject your premise that those regulations are somehow non-sequiturs or have no reason to be there.
...
There are certain things necessary for this free market system to exist.

Libertarians argue that private property and the enforcement of contracts should be the only laws governing trade, as these are necessary for a market to exist. However this seems to be based solely on a libertarian definition of "market". Markets clearly existed before the concept of intellectual property for example (and some libertarians oppose IP). A market of some sort existed in feudal England where there was no private ownership of land. And markets can still exist in the absence of legally binding contracts, with enforcement via violence rather than government intervention.

Likewise, I could create my own definition of a functioning market which has at its core the right to a fair wage for one's labor and the abolition of voluntary slavery or indentured servitude. That would be just as arbitrary as defining a market as a system with private property and enforcement of contracts. I have never seen a libertarian give a convincing argument as to why a market requires those few core laws to the exclusion of all others.

Edit: and to be clear, I'm not arguing against private property or enforcement of contracts, but arguing against the exclusion of all other legal controls on trade.

 

[jimbob]

So what about debt bondage?

that is surely just an enforcement of contract law?

 

[Ziggurat]

Government corruption? That's what you think causes child labour? Seriously?

Government corruption stifles economic growth, which entrenches horrific poverty. It is this horrific poverty which leads to child labor, because it is only under such conditions that child labor becomes more attractive than the alternatives. Similar child labor is not more attractive than the alternatives in the developed world, and would not exist in a similar manner even in the absence of any regulations restricting child labor.

 

[psychictv]

And why do children work in factories? Either because they were forced to (not acceptable to libertarians)

This is the only reason children work in factories. And like many things children are forced to do by their parents (going to church for example) it is difficult to impossible for the government to prove any such force or coercion.

Simply removing the option to work in a factory doesn't improve anything. The general improvement of standards of living, not simply the dictates of government, are the reason we don't face such problems today.

On the contrary, removing children from the factory was directly responsible for improving standards of living. Putting children into school rather than work leads to an educated society, and therefore a better functioning democracy and a more productive and innovative workforce. Removing children from factories drives up the price of labor which increases the standard of living and helps grow the economy through increased consumer spending.

 

[Ziggurat]

So what about debt bondage?

that is surely just an enforcement of contract law?

Only if the contract between the borrower and lender included such bondage as a term of default, otherwise no.

This is somewhat related to the question of whether or not a man should be allowed to sell himself into slavery. As someone who is not actually a libertarian, I confess that I don't really care about the ideologically preferred answer to that question.

 

[jimbob]

http://en.wikipedia.org/wiki/Factory_Acts#Factory_Act_1802

Factory Act 1802

The Factories Act 1802 (citation 42 Geo.lll c.73, sometimes also called the "Health and Morals of Apprentices Act") was an Act of the Parliament of the United Kingdom which regulated factory conditions, especially in regard to child workers in cotton and woollen mills. It was the culmination of a movement originating in the 1700s, where reformers had tried to push several acts through Parliament to improve the health of the workers and apprentices. The act had the following provisions:
Factory owners must obey the law.
All factory rooms must be well ventilated and lime-washed twice a year.
Children must be supplied with two complete outfits of clothing.
Children between the ages of 9 and 13 can work maximum 8 hours.
Adolescents between 14 and 18 years old can work maximum 12 hours.
Children under 9 years old are not allowed to work but they must be enrolled in the elementary schools that factory owners are required to establish.
The work hours of children must begin after 6 a.m., end before 9 p.m., and not exceed 12 hours a day.
Children must be instructed in reading, writing and arithmetic for the first four years of work.
Male and Female children must be housed in different sleeping quarters.
Children may not sleep more than two per bed.
On Sundays children are to have an hour's instruction in the Christian Religion.
Mill owners are also required to tend to any infectious diseases.

Fines of between £2 and £5 could be imposed on factory owners, but the Act established no inspection regime to enforce conditions. The act failed to provide a clear law of the hours one is permitted to work and failed to include supervision to make sure the law was being followed. The law was largely ignored by the factories but paved the way for more Factory Acts to follow. Richard Oastler in 1804 comments on the act:

 

[Ziggurat]

This is the only reason children work in factories.

Sadly, no, that is not always the case. Sometimes the alternatives really are worse

And like many things children are forced to do by their parents (going to church for example) it is difficult to impossible for the government to prove any such force or coercion.

Congratulations, you've stumbled upon one of the reasons that I am not actually a libertarian: the role of family is not well addressed by the ideology.

On the contrary, removing children from the factory was directly responsible for improving standards of living. Putting children into school rather than work

In other words, providing them with an alternative that is better than working in the factories.

Removing children from factories drives up the price of labor which increases the standard of living

And drives up the price of goods which decreases standards of living. Net increases in standards of living can only be achieved by increases in productivity. Which education can do, but again, you've still got to provide children with that better alternative or you're not doing any good. And it's the provision of superior alternatives which matters the most.

 

[psychictv]

And drives up the price of goods which decreases standards of living.

Increasing wages only drives up the price of goods by a marginal amount related to the percentage of the price that actually reflects the cost of labor. And only then in the absence of any competition. More often, the difference is made up by a reduction in profits. So overall, there is a net gain for standard of living.

 

[EGarrett]

What, precisely, would you like an example of? The Laissez Faire doctrine not being sustainable?

You said that a libertarian system would require everyone to totally buy into the ideals. I wasn't sure what your basis or reasoning was that lead you to make that statement.

The fact that Laissez Faire has given way to regulation and unionization isn't sufficient? Do you understand why things happened the way they did, why the various markets of the robber-barons were eventually met with regulation or why federalism was fought over so vehemently?

There will definitely be periods of crappy jobs and bad products and even recessions under a libertarian system. It could very well be that people chose to throw "interference band-aids" on these problems instead of letting them naturally heal. Just the fact that regulations did show up doesn't mean they were the best decision.

The key point of Libertarian philosophy, that personal property is sacrosanct regardless of community or nationality, falls short of a sustainable political philosophy from the beginning, since the only precedent for its establishment is that some guys asserted it as a philosophy. But to illustrate how and why the Libertarian philosophy is utopian, let me ask you these questions: do you feel that a Libertarian philosophy of government allows for democratically-elected governance? Why or why not?

I imagine that in a libertarian society the government would oversee enforcement of criminal laws and national defense, so the people in government would help to maintain those laws and do investigations...like the police and military do now. Perhaps we'd have only a group of police chiefs, constitutional judges and military heads who would be elected. We haven't really gotten through the free market though and learning about how or why it would apply so I don't want to go off on a tangent yet.

I ask those things because clearly Democracy in its base form is completely antithetical to Libertarianism, yet advocates of Libertarianism always seem to propose a government where the people are voting in a democratic-like system. While I understand that this is ostensibly presented in order to show that there would still be a place for a representative government, however much smaller it may be, the manner in which it's described how individuals would take or gain office seems to be completely the opposite of the Libertarian philosophy-- after all, if there's a vote, haven't those who voted "the other guy" not been afforded an equal amount of representation in their government as individuals? Wouldn't a democratic vote simply be the imposition of the majority upon the minority, which is precisely what the Libertarian philosophy opposes about the current form of federalist government, about worker unionization and government regulations, about the system of taxation and federal subsidy, and so on?

The government's might is not regulated by the market, so the people may vote for the people who control that. I honestly don't see the problem here?

I encourage you to explain away this small bit of what seems like a convenient cognitive dissonance as the first step in our having a reasoned conversation about why a Libertarian political system is a utopian ideal.

You said that all people must totally buy into the basic ideals of the libertarian system...I'm still not sure what your basis is for saying this.

I would also like to return to an earlier point:

Libertarians argue that private property and the enforcement of contracts should be the only laws governing trade, as these are necessary for a market to exist. However this seems to be based solely on a libertarian definition of "market". Markets clearly existed before the concept of intellectual property for example (and some libertarians oppose IP). A market of some sort existed in feudal England where there was no private ownership of land. And markets can still exist in the absence of legally binding contracts, with enforcement via violence rather than government intervention.

Yes, and there are black markets too. The libertarians believe in a specific type of free market though.

Likewise, I could create my own definition of a functioning market which has at its core the right to a fair wage for one's labor and the abolition of voluntary slavery or indentured servitude. That would be just as arbitrary as defining a market as a system with private property and enforcement of contracts. I have never seen a libertarian give a convincing argument as to why a market requires those few core laws to the exclusion of all others.

I don't know of any libertarian that claims that there free market is the only possible type of market, they believe that their free market is what works best for society. I think you're arguing against something that no libertarian says and that wouldn't even make sense for someone to say.

So you both would argue that there is some other regulation of the market that encourages the child labor?

Or lack of some other basic law...

Can you point to an example of what that might be?

Lack of personal property allowing warlords to steal people's goods thus stopping anyone from innovating and discouraging market competition forcing a few broken down factories to be the only options in town for employment? Lack of some police stopping coercion and allowing kids to be forced into slave labor?

What regulation could be removed which would reduce child labor? You can choose any example you wish, although the U.S. during the industrial revolution might be a good example, since Galileo seems to think that was a relatively libertarian period.

If the children were allowed to leave the factories and had other options for employment, then those primitive jobs with long hours may have been the best available at the time and better than toiling on a farm to grow your own food...until technology improved and competition sprang up and caused conditions to get better.

And if the children couldn't leave...then that of course is coercion which would be against the law in a libertarian system.

 

[EGarrett]

So what about debt bondage?

that is surely just an enforcement of contract law?

Debt bondage how? Having to honor your contracts is of course part of the system...but tricking people into signing deals where they lose their freedoms is fraud, and people might not be able to sign away those freedoms anyway. Of course I'm no expert on contract law or how libertarians view it, but I think that explains it somewhat.

 

[psychictv]

Yes, and there are black markets too. The libertarians believe in a specific type of free market though.
I don't know of any libertarian that claims that there free market is the only possible type of market, they believe that their free market is what works best for society.

Exactly. When asked "why laws protecting private property and contracts" you can't answer, "because those are required to create a market". Yes, the basic libertarian principles are required to fit a libertarian's definition of a free market. So what? It's a circular argument. Why is a labor law a forceful intrusion of the government into the market and the protection of intellectual property isn't?

Lack of personal property allowing warlords to steal people's goods thus stopping anyone from innovating and discouraging market competition forcing a few broken down factories to be the only options in town for employment?

And that describes the U.S. during the industrial revolution? We lacked private property and society was overrun with warlords?

Lack of some police stopping coercion and allowing kids to be forced into slave labor?

The point is that children aren't capable of making the proper decisions to enter into such employment contracts. It's quite easy for a parent to convince a child that they must work in a factory without the parent violating any laws that a libertarian would identify as "coercion."

 

[Ziggurat]

Increasing wages only drives up the price of goods by a marginal amount related to the percentage of the price that actually reflects the cost of labor. And only then in the absence of any competition. More often, the difference is made up by a reduction in profits. So overall, there is a net gain for standard of living.

Profits don't disappear into a void. And if the increase in labor costs is a negligible burden on the economy, then the increase in demand created by that increased wages are negligible too in terms of the economy as a whole.

 

[psychictv]

Debt bondage how? Having to honor your contracts is of course part of the system...but tricking people into signing deals where they lose their freedoms is fraud, and people might not be able to sign away those freedoms anyway. Of course I'm no expert on contract law or how libertarians view it, but I think that explains it somewhat.

Debt bondage would clearly have to be allowed under a libertarian system. It's not fraud if you voluntarily entered into the contract.

 

[psychictv]

Profits don't disappear into a void. And if the increase in labor costs is a negligible burden on the economy, then the increase in demand created by that increased wages are negligible too in terms of the economy as a whole.

I didn't say the increased labor costs were negligible to the economy as a whole. I said that in a competitive market some of the increased cost is going to come out of profits which means that there isn't a 1:1 ratio of increased labor cost to increased prices of goods and therefore higher wages have a net benefit for the economy.

Say for example we both manufacture widgets that we sell for $99.95 and that were designed to hit this price point. Let's say that labor is 20% of the cost of manufacturing the widget, and we both make a 10% profit. Suddenly there's a government mandated increase in wages which raises the per-unit labor cost by $5. You can price your widget at $105 and I can decide to let my profits get cut in half and keep the $99.95 price point. Unless you take a corresponding hit in profits and lower your prices back down, I'm going to steal all of your business.

So in the face of competition and in the absence of any price fixing or collusion, increases in labor costs are going to tend to come out of profits rather than leading to an increase in prices. Meanwhile we both benefit from increased sales as our employees can now afford to buy more of our widgets. Having that extra money go to a worker to be spent and recirculated into the economy is always going to be better for the economy than having it sit in your or my bank account. That is, unless you believe in supply side economics.

 

[GreNME]

You said that a libertarian system would require everyone to totally buy into the ideals. I wasn't sure what your basis or reasoning was that lead you to make that statement.

I was clear on that, but considering the variations of what people qualify as "libertarian" in general terms, my goal is to answer what you want to have answered instead of providing an alphabet soup of answers and attempting to find the right one to match your perceived version of what qualifies as a Libertarian system. In short, no "pure" system works without buy-in from the population, but different systems require different degrees of buy-in to work. For example, a pure democracy doesn't require everyone to buy into the system, since it's majority rule by default anyway-- all the system requires is a majority. A socialist or communist system also has a percentage of "enough" people required to keep the system, though that number is much higher for communism, close to and arguably similar to that of Libertarianism. Anarchism, on the other hand, is another system that requires total buy-in from the population to sustain itself, due again to the very granular level of the core concepts of the philosophy. In fact, the more granular the philosophy gets down to the individual, the higher the likelihood that the entire population would need to buy into it for the system to maintain.

There will definitely be periods of crappy jobs and bad products and even recessions under a libertarian system. It could very well be that people chose to throw "interference band-aids" on these problems instead of letting them naturally heal. Just the fact that regulations did show up doesn't mean they were the best decision.

I have no point of reference for what you mean by "naturally heal" in this context. You seem to be referring to an economy, but there is no basis for assuming any naturalistic features of an economic political system that's run and operated by individual human beings. Systems are going to be driven by the desires of the people running and operating the system, regardless of the architectural make-up, and people under duress and stress react differently than they do when not under duress or experiencing stress. Economic systems exist basically because people want them to, so the presence or absence of regulations seems no more or less "natural" to an economy than anything else.

To be clear, what I'm saying is that you seem to be implying regulations are somehow an unnatural or external attempt to mend something that allegedly will mend naturally or under internal conditions, and I question the underlying basis for such an assertion since it doesn't jibe with what is understood to be an economic system in a general sense.

The key point of Libertarian philosophy, that personal property is sacrosanct regardless of community or nationality, falls short of a sustainable political philosophy from the beginning, since the only precedent for its establishment is that some guys asserted it as a philosophy. But to illustrate how and why the Libertarian philosophy is utopian, let me ask you these questions: do you feel that a Libertarian philosophy of government allows for democratically-elected governance? Why or why not?

I imagine that in a libertarian society the government would oversee enforcement of criminal laws and national defense, so the people in government would help to maintain those laws and do investigations...like the police and military do now. Perhaps we'd have only a group of police chiefs, constitutional judges and military heads who would be elected. We haven't really gotten through the free market though and learning about how or why it would apply so I don't want to go off on a tangent yet.

Thanks for answering. I needed that so that I understood what kind of system you're imagining, so that I could address it accordingly.

In the society you're imagining, what would be the basis of jurisdiction for those maintaining laws or conducting investigations? Who would pay for the police chiefs or "constitutional judges" (are current judges not constitutional?) or military heads? I realize that you feel entering into a definition of what constitutes a free market would be a tangent, but with any government there are going to be costs, no matter how small the government body actually is. There is a definite need to address those costs, as well as covering costs for infrastructure both between government agencies and between the government and the citizens.

The government's might is not regulated by the market, so the people may vote for the people who control that. I honestly don't see the problem here?

But if the people who are electing representatives to operate their government are not having their personal rights represented, what does the market have to do with it? Are they not disenfranchised by the majority who vote for Candidate OtherGuy?

You said that all people must totally buy into the basic ideals of the libertarian system...I'm still not sure what your basis is for saying this.

The basis is the core principle of the Libertarian philosophy. Can you tell me what you feel is the core principle of the Libertarian philosophy in your own words? I have described the basic principle of personal property rights, but I think it best that I attempt to explain it from language you're already comfortable with.

 

[GreNME]

Profits don't disappear into a void. And if the increase in labor costs is a negligible burden on the economy, then the increase in demand created by that increased wages are negligible too in terms of the economy as a whole.

Economics isn't a zero-sum game.

 

[WildCat]

Economics isn't a zero-sum game.

But a company's balance sheet is.