Nice, this makes sense to me. Thanks
Huh? That is just restating the same question that we can answer with, “Yes, it is unjust for you to initiate aggression (personally or indirectly through government’s monopoly on violence), to seize property from someone when no property was stolen from you.” Again, a price is not property… Try this:
Let’s say that you have lived in a neighborhood for years and your next-door neighbor Eva (who just moved in a week ago) is a supermodel who sunbathes naked every afternoon, then bakes delicious pies and delivers them to the whole neighborhood, but only knits scarves for close-by neighbors. You have been trying to sell your house for months and since Eva has moved in you have noticed the potential selling price of your home has increased 3000%, presumably due to this god among women who just moved next door.
Would it be unjust for me, [a libertarian or whomever], to petition for [government involvement or a legitimate coercive action] when one of these following conflicts arise?
- Eva has demanded 3/4 of your huge profit when you sell your home, and you must sell your home she says, or else she will kill you. You even saw her lure Chuck over with a delicious pie and choke him out with a scarf when he refused to sell off his house.
- Edna lives a few blocks down and noticed the huge crowds camping overnight just to get into your open house. She likes the pies but she has been trying to sell her house too, and her bids are basically flat. She wants a piece of the action and might do something about it.
This is actually one of the easier examples to answer. It deals with externalities.
Your neighbour is infringing on your property rights through his action on his own property.
It is one of the easier ones because a court can easily measure the external costs associated with your neighbours behaviour - the fall in the value of your house.
He then has two options: stop his behaviour, or pay the full cost of his behaviour.
Even transaction costs should not be a major problem here, because again, they can be attributed to the external costs of your neighbours behaviour.
A more difficult question on this subject is when the external costs are not so easily measured in financial terms, such as pollution to the environment. But that is for another day.
granrojo, and when you clean and tidy up your front yard, you present your neighbours with a bill?
Not at all.
Positive externalities cannot work the same way, you can only charge somebody for a product or service if you have agreed a contract. The point is, in the anti-Semitic case, the neighbour is forcing upon me the provision of a service (for want of a better description) which I never asked for and that is causing me harm. If my neighbour comes into my front yard and tidies it, then he might well expect a bill from me.
At the heart of this is not “property rights” but “well defined property rights”. You do not have to physically enter someone’s property in order to violate their property rights.
If you don’t allow for this then a laissez-faire economy can never prevail. All one would need to do is buy one property, act in the most malicious way possible to drive down the prices of neighbouring properties, then buy them at the discounted price. Once you own all the properties that people have not wanted, you would simply stop doing whatever you was doing to push down the prices and reap the benefits.
Others could not do the same in return as you would now own all the properties in the area. They could only affect your properties on the outskirts, which would be a small cost to pay in return for your new vast property empire.
Although, I am sympathetic to the argument that this is wanting to have it both ways. The trouble is that the laws of economics do not allow any other ways of dealing with externalities. Those on the left would argue that this needs government intervention, Libertarians argue for well defined property rights.
Granrojo, what if a black family moved into your neighborhood, and as a result, drove down the prices of the homes in your neighborhood? How would you deal with that externality?
Granrojo, what if the neighbor’s actions caused the value of your house to go up, because now someone is willing to pay top dollar to be neighbors with a Jew-hating Nazi-lover?
Let me use a different example to answer this:
I am speeding in my car and as a result I crash into somebody else, causing damage to their property. It is “reasonably foreseeable” that by driving too fast I may cause damage to someone else’s private property (both their car and their health). It is therefore right that I pay compensation for my actions. The accident was “reasonably preventable”, all I had to do was not speed.
If I am driving with due care and attention and there is some kind of freak accident, (say a branch falls from a tree causing me to swerve and crash), it is not reasonably foreseeable. Therefore, I should not have to pay compensation. (You can talk to the owner of the tree if you like).
Back to the original example:
If my neighbour puts unduly offensive material outside his house, it is “reasonably foreseeable” that he will cause damage to the value of my private property. It is also reasonably preventable.
If a black family moves next door, it is not reasonably foreseeable, and more importantly, not reasonably preventable. Therefore, no compensation should be paid.
This is a reworked example of nirgrahamUK’s comment, so I won’t answer it again here.
I understand that using terms such as “reasonably foreseeable” opens many other issues. I am happy to debate these, but I think it would probably warrant another thread. Another day.
it is ‘reasonably foreseeable’ for anything other than what is impossible. but that doesn’t mean it’s true or not. even lies are possible, correct?
“Reasonably foreseeable” is completely arbitrary. There are plenty of neighborhoods where a black family buying a home in said neighborhood would "“reasonably foreseeably” drive down the value of the other homes. Furthermore, I’ve seen plenty of accidents happen at low speeds, so it would also be “reasonable foreseeable” that a n accident would happen at low speeds.
Which means that it is a different question, thus, your response to nirgrahamUK’s example is not necessarily a response to my example. Furthermore, it is not. What is more, I asked this earlier in the thread and before nirgrahamUK.
The problem with your negative externalities is that it necessitates that the person being “harmed” has a (derivative) right to a relatively higher value. That the harmed person’s rights supersede the property rights of the the Jew-hating Nazi-lover.
I ask you this question (which I hope you won’t avoid):
Say you own a horse and buggy company, and it is reasonably foreseeable that the automobile would drive down the value of the horse and buggies you sell. Do you then have the right to prevent me from manufacturing and selling automobiles? After all, I would be driving down the value of your horse and buggies by my actions.
loss of the market value of a good, is not harm, you do not own the market value of a good which you own. only the good itself and the right to sell the good, at whatever price the buyer and you are able to agree terms on,
the ‘(market) value(price)’ of the property, which you suppose to us ‘varies with the locality of nazi’s and undesirables’ is really just an imaginary number based on a speculative thymological estimate, of what you could get in money if you sold your property at the time you are estimating. how can you own such imaginations?
If someone is accused of murder then a jury needs to make a decision about his guilt. It is impossible to be 100% sure either way, therefore in law we use a concept of reasonable doubt. It is a completely arbitrary decision for each member of the jury.
In a civil court the burden of proof is reduced to the balance of probabilities - that it is more likely than not. Either the Judge or the jury must decide on what they reasonably believe to be the case.
The reason this is important is that it is impossible to make a law for every event. The last thing we want is politicians reaching for the statute book every time someone introduces a new technology. The law should be settled in the courts, not the political arena.
A good example of this is in the use of mobile phones while driving. In the UK we have always relied on words in law like “due care and attention”, again completely arbitrary. Because the use of mobile phones while driving became a political issue they passed a law specifically banning it. The result is that people can now get round the law my claiming they were using it not as a phone but as a dictaphone, no one ever passed a law against that.
The same argument can be had with drink driving. You can stay awake for days on end, drive without paying any attention and crash. But if you go one drop over the drink drive limit you will lose your licence, no matter how carefully you was driving.
Austrian School economics can solve many of the worlds problems through providing a level playing field and getting better efficiencies from your resources. I have never heard anyone claim it will solve the need for a legal system, the courts, lawyers and legal argument. How else do you enforce your property rights?
Yes it is a different question. What I meant was that my answer would be the same. You don’t seriously expect me to argue about who said what first? My point was that I felt I had already answered it, so to save that commodity we call time, I would not answer it again. I answered nirgrahamUK’s question because he directly asked me in response to my first comment. But anyway:
Positive externalities cannot work the same way, you can only charge somebody for a product or service if you have agreed a contract.
I am not saying that anyone’s rights supersede anybody else’s. What I am saying is you can have all the freedom in the world as long as you pay the full cost. Sometimes there are hidden costs to your actions, in order for the market to function properly it is important that the right person carries the right cost. Otherwise the market becomes distorted and will head on a destructive spiral.
Why would I avoid it?
In my opinion then no. But it is not really my decision to make, as I’ve said, I believe that the decision as to what is reasonable should be decided by a court of law, preferably by 12 of my peers.
I don’t specifically have an opinion on the Jew hating Nazi either. I answered that question in the context of it being given - that it was an overtly offensive action which could be directly attributed to the damage done to somebody else’s private property.
If you don’t mind then I will finish by asking you a similar question:
If I own some land in the middle of a town, should I be allowed to build a factory that will pump excessive amounts of pollution into the surrounding area? I personally don’t live anywhere near the town and all my goods are for the export to a country where the people couldn’t care less about the environment where they are made.
It is likely that the pollution I cause will have the same repercussions as the Great Smog in London 1952.
I have to completely disagree. The market value is the best (although not 100% perfect) way we have to measure resources. It is the common denominator we have to compare different commodities which put together make up our private property.
If, by accident, I damage the front wall to your property then you still have all the bricks which make up your private property. But it is not the same, which will now be reflected in the market value.
If I own a trademark then it is my private property. If you then damage that property by infringing my trademark then I should be entitled to compensation. The only way we have to decide the correct compensation is through financial means, the damage to my market value.
A cost benefit analysis will decide whether it is now financially viable for you to infringe my trademark for your own profit.
Unfortunately this shows that private property rights are not the end of the argument but rather the beginning of the debate. Why should you get to decide how property rights are defined? Why should I? You say it only includes tangible goods, I say it includes my personal health and intellectual property as well.
Personally, I believe that when the Government damages my savings through expanding the money supply then they should have to compensate me for the loss of market value of my private property (in this case my currency). I imagine in that case they would not find it so worthwhile as they would have to bear the fall cost of their actions, the externalities included.
As much as we believe you should, I don’t think that you actually have any God-given right to property rights. You can only obtain that through convincing society that it is the best system for economic growth, and therefore a better world for everybody. Which is what most people on this site are trying to achieve.
The only other way you can ensure your private property rights is through the use of force. History shows us that laws must have the support of society, otherwise they will fail. If you cannot convince enough people then force alone will not work over the long term, just look at the Socialists.
It’s not that hard. In an anarchist society, people would still try to form communities. It’s also possible that there would be an anti-Jew community. I also think that there will be some sort of “government-like” institutions, as most communities will be like gated communities, with the landlord being like the governor. Those private communities will limit some negative liberties (for example, listening to loud music, making skyscrapers in a residential area, painting your house with Hitler images) and people would voluntarily join, according to their thinking.
I think that most of the problems of current society doesn’t come from the fact that social welfare and social security exist, but from the idea that private property does not exist regarding to governments. Would negative liberties be limited in an anarchist society? Sure, no one denies that. But it would be voluntary, and I think the output from this will be like “governments” (private property ones) in healthy competition.
There are also social problems that we should consider. If someone starts painting his house with Hitler images, we would probably be hated by his non-anti-Jew neighbors. But well, maybe he values being a hated person, who knows.
And what if my neighbor paints his house pink? I find that offensive! What if he hangs a giant American somehwere on his property? I find his nationalist fervor offense? And what if…???
This entire post still sounds like a case of QQ to me.
So how does that relate to anarcho-capitalism/libertarianism?
Why is it different for “negative externalities”?
What full cost? What do you mean by that?
Who chooses the court of law and from where does the courts’ authority derive?
Losing “value” is not damage. Therefore, what you say makes no sense.
A town? What constitutes the town? Anyway, you can build the factory if you get permission from the affected landowners and if you are not violating anyones rights. Are you comparing to the Jew-hating Nazi-lover case by saying that it is also pollution?
“QQ”?
QQ or TT is asian emoticons for crying. 
My answer is no, I would not. I don’t believe in participating in the system, for any reason. At all. Unless it’s Jury Duty. Mwahahaha…
nirgraham’s joke answer seems fine enough, to be honest.
Blatantly inconsistent. Either they work the same way or there’s no such thing as “externalities” as such. Pick one.