Comment by nrr | Hacker News Reader

Comment by nrr | Hacker News Reader

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Is this true? I ask because the metric for determining the distance from the US's construction at any point in time to the libertarian ideal is unclear. Like, given an assertion of closest, it should be quantifiable[0].

It should also be falsifiable and admit a counterfactual.

1. The US was within some epsilon of being libertarian;

2. The US became rich;

3. Therefore, the prosperity of the US was a direct consequence of libertarianism.

It's 2. here that I scratch my head at because, uh, the US has through its entire history, even pre-1776, been rich. It wasn't liquid wealth in the financial sense, but the US has had oodles of arable land, navigable waterways[1], natural resources, and favorable geography. It's only within the last 250 years that we've realized wealth in the form of bonkers huge internal markets and (at least, before recently) high levels of immigration.

In fact, going back to 1., if we consider the laissez-faire dimension alone and compare it against the rate of wealth growth the US has sustained at least over my lifetime, the relationship is inverted[2]: we've somehow managed to accumulate more wealth as we've become less laissez-faire. This is a confounding variable that needs to be controlled for before we can draw a causal inference either way.

I'd also argue that broader land policy, education, formal banking institutions, infrastructure, immigration policy, patents and other forms of economic protectionism, and research and development all belong in that causal model since they also tend to be things I look at when analyzing risk and uncertainty.

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0: I'm still unsure if this quantification is even appropriate. Libertarian-ness admits a whole-ass vector space of institutional characteristics, and it isn't obvious to me how the norm would fall down to aggregate all of them as a single scalar for the purposes of making this argument.

1: The fact that pre-Columbian civilizations didn't have the wheel was often a justification for how backwards they were. As it turns out, when you have as many rivers as North America has, getting around without the wheel is no big deal. It's just pre-Columbian YAGNI.

2: Well, kinda. Both "wealth" and "laissez-faire-ness" minimally need operational definitions and some kind of partial order to be comparable like this.

> It wasn't liquid wealth in the financial sense, but the US has had oodles of arable land, navigable waterways[1], natural resources, and favorable geography. It's only within the last 250 years that we've realized wealth in the form of bonkers huge internal markets and (at least, before recently) high levels of immigration.

So has Russia, South America, Africa, Asia, etc. The high levels of immigration came from poor people in un-free countries coming to the US to make their fortunes. Free markets is what has distinguished the US from other countries.

And every country that has tried free markets since has prospered accordingly, regardless of their natural resources, waterways, etc. Like, what natural resources does Taiwan have?

> The high levels of immigration came from poor people in un-free countries coming to the US to make their fortunes. Free markets is what has distinguished the US from other countries.

I accept that free markets is only one possible answer here. A lot of folks moved here because the US had all of that land that I'd mentioned. There were also some unusually high wages here compared to most of Europe in the 1700's[0, 1]. The political institutions here also allowed certain freedoms that weren't available in Europe (of particular note for me personally is the Münster rebellion), and by the time the earliest members of my family moved here in the 1860's, there were already immigrant communities to lean on.

This goes notwithstanding that the US had developed a bonkers huge continental economy with relatively abundant capital.

My argument isn't that markets didn't make this possible. My argument is that drawing a causal inference based on markets alone is intellectually dishonest.

> And every country that has tried free markets since has prospered accordingly, regardless of their natural resources, waterways, etc.

Can we identify the countries that "tried" a free market approach? Can we identify which of those subsequently prospered? Is the relationship between those two things consistent enough to support the consequent of prospering accordingly?

I think the first is perhaps most obvious, but I'm at a loss for how to answer the latter two.

> Like, what natural resources does Taiwan have?

I'm honestly left scratching my head a little at what about Taiwan meets the bar for being a free market or where the comparison is here.

Taiwan has historically had heavy-handed state-directed industrial domestic policy. Like, the favoring of semiconductors wasn't an accident of the market figuring out what to do there. The domestic capital markets at the time of TSMC's founding were too small to finance the construction of a fabrication plant, so the government stepped in to assume the risk[2].

From a risk management perspective, though, Taiwan does tend to eschew a lot of the economic protectionism that we see elsewhere. Tariffs are less of a problem there, and the state will tend to sell its interests in businesses that don't do well abroad, so there isn't a sort of pathological "Weekend at Bernie's" or "too big to fail" kind of situation.

Taiwan's government also tends to fund research and development much more heavily.

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0: Lindert, Peter H. and Jeffrey G. Williamson. "American Colonial Incomes 1650-1774." NBER Working Paper Series, no. 19861. January 2014.

1: Lindert, Peter H. and Jeffrey G. Williamson. "American Incomes 1774-1860." NBER Working Paper Series, no. 18396. September 2012.

2: This condenses a lot of the history of TSMC. It actually starts with ITRI in 1973 and the edict from above that research should focus on semiconductor development. Morris Chang then built on a lot of expertise developed via RCA and devised the foundry model, which then led to TSMC's founding. In some sense, it could be argued that the state deliberately constructed the market surrounding the semiconductor manufacturing industry.

> the US had developed a bonkers huge continental economy with relatively abundant capital

The US created that economy and created the capital. Colonial America had much of nothing.

> Taiwan

I asked Google "is taiwan a free market country?"

yielding:

"Taiwan has a highly developed free-market economy where prices are set by supply and demand with little government control."

> Colonial America had much of nothing.

I'm unsure that I'd draw that conclusion. Why else would the Crown want to tax the colonials so heavily?

> "Taiwan has a highly developed free-market economy where prices are set by supply and demand with little government control."

Forgive me. Was this in dispute? I was asking what causal work the label "free market" was doing with respect to Taiwan and how the country's economic development was adequately explained by laissez-faire economics.

The patient is healthy now, so the treatment that produced the health must have been "being healthy."

The Crown did not heavily tax the colonials.

Bone evidence showed that the colonials worked like dogs and died young.

> The Crown did not heavily tax the colonials.

Huh, did they not? After the Seven Years' War, the Currency Act of 1764 received assent, and it functionally required that public debts be paid in hard money. Unless I'm remembering incorrectly, this was a little hard to come by in the colonies.

> Bone evidence showed that the colonials worked like dogs and died young.

I'd be interested to see the anthropological chain of inference for this.

I've read many accounts of the Revolutionary War, and the colonials were mostly offended by sending their money to England. Any tax seems heavy if the proceeds do not benefit the taxpayer.

> I'd be interested to see the anthropological chain of inference for this.

I read it many years ago. Sorry, I don't have a reference. I regret not having a photographic memory.

> Any tax seems heavy if the proceeds do not benefit the taxpayer.

I dunno, man. Caesar asks for his money, and I just give it to him. I don't really have much of a say.

> I regret not having a photographic memory.

That's fine. I don't have a photographic memory either; I just have a few boxes of 3x5 notecards and accompanying topic/source indices in a notebook.

I'm going to try and summarize.

You said, essentially, "sure the US had freedom, but maybe the amount of land and resources it had is the real reason it has done so well."

Walter countered with, "Taiwan is a tiny island with very little resources, but it is economically prosperous, so maybe land and resources aren't a big factor. It also happens to have a free market economy."

You replied with what sounded like an attempt at saying that Taiwan wasn't actually a free market.

Walter said, "I don't know man, I just did a quick search to make sure Taiwan wasn't communist or anything before adding it as some data to your analysis."

Does that clear things up? We're just trying to help you out here. We've already made up our minds but it sounds like you're still wondering so maybe we can help?

I'm mostly trying to pick apart the epistemology of thinking about economic systems this way because, hey, maybe there's something that my professional background in the subject is blind to.

It isn't especially interesting to me to try devise frameworks for coercing Caesar to do one thing over another; Caesar's just going to do what Caesar's going to do. The most that I can do is hedge against needing to migrate again because this Caesar has decided, e.g., that staunch pacifism is treasonous.

Libertarianism is far more than just an economic system and it's too bad it went down that narrow piece of it.

I don't understand your reference about coercing Ceasar but a major tenent of Libertarianism is not coercering anyone to do anything. Individual liberty and personal property are the dogmas. If you have a problem with someone, talk to them about it, or ignore them. Give them your time/attention/money or don't. If you want others to help you with these problems you have to gently persuade them, not give up all our liberties so men with guns can force people to do one thing or another.

> Libertarianism is far more than just an economic system

Acknowledged. That nevertheless tends to be where my interest in it lies. Near as I can tell, I don't actually have much of an ideology; I wasn't raised to be political in the typical Anglo-American sense.

> I don't understand your reference about coercing Ceasar

This gets a little in the weeds about my conceptualization of the state, but here's the view from 10km high:

Caesar is a model of an institution that arises when coordination problems exceed the capacity of voluntary associations. He's an emergent response to complexity, and I tend to ask questions of him that are flavored more like, "What coordination problem requires coercion, if any, and how much coercion is actually necessary?"

(As it turns out, the answer looks something like "enough to prevent folks from killing each other." My Mennonite upbringing makes me inclined to add in "and perhaps enough to keep the trust of the congregation," but I'll admit that's probably less relevant for secular folks.)

> but a major tenent of Libertarianism is not coercering anyone to do anything. Individual liberty and personal property are the dogmas.

Why is property yours in the first place? Property is a socially enforced exclusion, and a construction of a society out of that major tenet of noncoercion and enforcement of property rights is by some measure impossible.

> If you have a problem with someone, talk to them about it, or ignore them. Give them your time/attention/money or don't.

This is definitionally impossible with Caesar.

> If you want others to help you with these problems you have to gently persuade them

I feel like this ignores collective action. Persuading enough individuals to contribute voluntarily is itself a coordination mechanism, and it isn't obvious to me how it could produce the same equilibrium as collective provision.

If the benefit is broadly non-excludable, there's a familiar free rider problem, and at some point, "please persuade everyone gently and individually" isn't really a solution to the coordination problem. It instead kinda handwaves it away.

> not give up all our liberties so men with guns can force people to do one thing or another.

Caesar isn't necessarily someone who happens to have more guns (though, typically, he tends to be). It's more important to consider that he's the head of an institution that is embedded in laws, norms, mores, folkways, consensus, trial of facts, bureaucracies, and behavioral expectations of individuals.

Moreover, coercion isn't even the defining feature of Caesar. It's just the backstop in his toolbox for solving coordination problems.

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