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There's a fair amount of libertarians on this forum, so I guess this question is not completely out of place here: how does libertarianism handle the problem of externalities?  I'm thinking in particular of problems such as acid rain (some of the younger ones may not remember this, but it used to be a serious problem in Europe and the US back in the 70s and 80s, though the situation has largely improved since the introduction of strong regulations on sulfur emissions from power plants), or a more contemporary example like CO₂ emissions and their role in anthropogenic global warming.

Feel free to point me to some external resource that you feel presents a good libertarian solution to this problem.  I'm genuinely curious.

If you pump out pollution that damages my property, then you're liable for that.

See Walter Block as he has done a lot of writing on this subject: http://www.walterblock.com/wp-content/uploads/publications/misallocations_externalities.pdf

In addition to what bitcoin4cash has linked I want to point that when pollution started to be an issue in the USa people naturally went to the courts to sue the ones that were polluting their property. And the courts where handeling it. Its common sense. But the government got in the middle, took away the environmental property rights from the people, promising it would regulate and take care of it. The regulatory system has obviously lead to a corporate takeover. If environmental property rights were applied the BP gulf oil fiasco would have never happened (and even in the case it would have happened BP woold be bankrupt now and the people compensated).

Thanks for the replies, guys.

So essentially the libertarian solution to the problem of externalities is to make use of the legal system.  I agree this can work in cases where this a clear delineation of the infringer and the victim -- for example if an oil company pollutes my property.  However, how would you handle cases that transcend national boundaries, and/or the victim is the globe as a whole?  Acid rain was a classic example of the first case: sulfur emissions from power plants in one country would cause acid rain to fall in countries downwind.  I reckon this could still be solved using the legal system, though it would require a transnational legal system that all nations would be bound to.  Anyway, I'm glad that libertarians also agree that we do need strong transnational institutions (like a World Court).

Well, yes and no. You dont need a World Court to have global justice. In fact, you need to not have a World Court to have justice at all. Any centrallized system is created to abuse, and a centrallized court is no different. Different districts or judicial companies can opperate and agree in collaboration and competition and solve the global issues.

Regarding problems like acid rain and sulfur emissions, it is true that this are difficult problems to solve, but they are also difficult using other methods. They are difficult because they involve a lot of people. The best way to go about it would be to form associations so people could so together.

The idea of a world court isn't a bad idea per se. A hypothetical free world would be stateless so there would be no national boundaries or institutions like the present day UN. If there would be any significant free areas where there is (at least reasonably "libertarian") private law and enough defense capabilities, I think that government worldwide would be pretty swiftly abolished. I think libertarians shy away from making pie in the sky promises because of how politicians act but I also think that the prosperity from free migration and free enterprise would be pretty astounding. Any still existing states or polluters who want to play by different rules would just be treated like any other criminal organization.

You also have to look at the current world situation:

Who are the worst polluters?

Who are the best, environmentally?

Turns out, the more free market a country is, the fewer polluting companies there are. Go figure, people don't like companies that piss in their pools.

jon_smark, I just wrote a relatively long post answering some concerns as to how a free market peer-to-peer court/legal system could handle negative externalities such as pollution:

http://forum.bitcoin.org/index.php?topic=17426.msg277907#msg277907 (http://forum.bitcoin.org/index.php?topic=17426.msg277907#msg277907)

Basically, pollution is a form of trespass on your property, and therefore polluters can be sued for legitimate damage to your property.

That doesn't work very well. What happens is some guy spends millions of dollars building a factory and then someone buys land right near him and then specifically puts in something that will suffer absurdly high amounts of damages. He can then blackmail the factory owner into paying him to not use the land.

Damages from pollution are not due to the polluter alone. They are due to the relationship between the polluter and the thing damaged. See 'The Problem of Social Cost' by Ronald Coase. It's surprisingly readable.

The short answer to how Libertarianism deals with externalities is "not very well, they're a very hard problem for any system". Whether it will handle them better than other systems depends on how well you think Libertarianism will work overall. (Prosperity makes externalities easier to handle.)

Well now this gets more complicated.  The issue here depends on whether that land next to the factory was previously unowned or not.  Provided that the factory owner was the first one to construct his factory on the unowned land, he may have gained rights to pollute the neighboring land assuming it was legitimately homesteaded.

Right, that's the problem. "The polluter pays for his damages" seems really simple and elegant (the Pigouvian system). You almost think, "oh, it's that easy!" Well, it's not, Coase rained on that parade. And the idea that someone who pollutes might acquire the right to pollute and then some guy can't use his property the way he always wanted to down the road is much less intuitively appealing.

Normally, you get rights to someone else's land through usage that is directly adverse to them. It has to be something a person would see, know about, and choose to ignore. But pollution can be invisible. And the idea that someone might gain free reign to pollute simply by nobody noticing is not very attractive.

Again, it's a hard problem. No system known (other than pure authoritarianism with a dictator who really hates externalities) handles it well.

I was referring to the fact that in that case, the polluter may have legitimately homesteaded pollution rights to that neighboring land.  I can't predict what a free market peer-to-peer legal system would rule in this particular example, of course.

Exactly. It might evolve rules that handle these cases well. Or it might not. Personally, I think that it's such a hard problem that the legal system won't do a very good job of handling it. Whether non-legal consensual approaches (whether based on community action, reputation, boycott, or whatever) will work well -- I don't know.

My general answer to the question is that other systems don't handle externalities well, so even if Libertarianism doesn't either, that's not a very good argument against it. (Unless someone claims it will lead to a perfect paradise.)

IMHO libertarians rely too much on the Coase theorem. It's only meant to apply to cases where transaction costs are effectively zero, which is rarely the case (Bitcoin excluded ;D).

I agree. But I'm only citing it to point out the problem. The problem gets worse when transaction costs are higher.

It is hard to say.  I don't think market-anarchists claim to create a perfect world, but rather they simply think that competing peer-to-peer dispute resolution agencies where law arises through a common law-like mechanism is preferable to monopolistic top-down hierarchical legal systems (ala USA) where law is enacted by legislative fiat.  It is strange how people commonly accept that competition areas such as biological evolution, business, sports, etc. will produce desirable outcomes, but, for some reason people have been conditioned to assume that competition in such fundamental areas such as security and law is unfathomable.  Market-anarchists simply extend competition to these essential areas.


I actually tend to have the same view.  I am reminded of a David Friedman (anarcho-capitalist son of minarchist economist Milton Friedman) lecture on the related topic of market failure.  His argument is that while market-failure may admittedly exist in a free-market, there is even worse market-failure in the "political-economy" due to the concept of rational ignorance.  The tl;dr summary is basically that both voters, interest groups, lobbyists, and politicians are not exactly incentivized to understand the effects of their policies on the public good.  Each entity in this "political market" is just incentivized to do the "best" thing for themselves, which may not be the best policy for the 300million people making up the public.  He gives a great and entertaining speech just on this topic on youtube: "David Friedman's speech on market failure @ the 2010 Free State Project Liberty Forum : Part 3/7" (http://www.youtube.com/watch?v=0Gxa9Iq_pNs)

(update: for those of you who are ambitious readers, please check out Chapter 18 "Market Failure" of David Friedman's book on Price Theory http://www.daviddfriedman.com/Academic/Price_Theory/PThy_Chapter_18/PThy_Chap_18.html (http://www.daviddfriedman.com/Academic/Price_Theory/PThy_Chapter_18/PThy_Chap_18.html) where he talks about the market failure of voting under the header "PUBLIC GOODS AND EXTERNALITIES")

And even when they do understand the effects of their policies on the public good, they're highly incentivized to convince others that what's good for them is good for everyone.

Yeah!  Double-Wammy.  :D  And it gets worse, since voters and politicians aren't held legally liable for damages caused by their policies.

Okay, you intend to solve these disputes through legal means. As far as I know libertaniasm is either minarchism or anarcho-capitalism. Thus the government, which is the main way of reinforcing laws is considerably weaker than currently. How do think that you can a) produce sufficent laws b)reinforce them under libertarian system?

Exactly.


And, as I asked in another thread, what prevents the people with money (which, will be the people polluting) from controlling the privatized legal system and making their polluting completely ok? 

Even if the privatized legal system remains perfectly neutral and immune to influence (nearly impossible), under what authority and with what force are the decisions enforced?

Large scale polluting enterprises are actually fairly fragile operations.  A coal mine or an oil refinery, for instance, can be completely shut down by just a few people rather easily.  Look at any oil pipeline in any disputed region for an example of locals shutting down industry when its costs outweigh its benefits.

There's a completely erroneous view in this thread that courts exist to enforce the will of the community.  It's actually the complete opposite.  Courts exist to prevent mob justice.  And even then their abilities are ultimately limited.

Where anyone gets the idea that more laws would be required I have no clue.

Citation please.


The rest is not relevant to what I asked.

http://articles.cnn.com/2011-02-26/world/iraq.refinery.attack_1_oil-refinery-attacks-on-oil-pipelines-iraq?_s=PM:WORLD

Dude, Iraq is a warzone, of course shit is getting attacked left and right.  Find me an example of a country not already up in flames in which natives have successfully ejected a corporation stealing their resources.

http://www.washingtonpost.com/wp-dyn/content/article/2007/09/10/AR2007091000596_pf.html

Does Mexico count?

Ok, so they attacked a pipeline and that did... nothing.  The oil companies aren't going anywhere.  I said find an example of natives OUTTING a resource robbing company or your argument holds no water.

Back in the real world, these companies do get attacked all the time by angry natives, but I have yet to see it make them pack up and leave.  What ends up happening is these natives get labeled terrorists and either the local government or the US government comes in and disposes of them, all while calling it "bringing freedom" to the people of the country.

This is a good argument against Libertarians who claim that a Libertarian society would be a paradise. However, these criticisms apply equally well to every proposed system, perhaps with the exception of a monarchy where the monarch really hates pollution. A Republic has the same problem because the polluters have lobbyists.

Someone generally would have only acquired the "right to pollute" in one of two ways:

- the land being polluted was unowned (any government land is effectively unowned)
- the polluter made a contractual agreement with a landowner to be able to pollute

So how does that then become "some guy can't use his property the way he always wanted to down the road"? It either wasn't his property yet, he agreed to the pollution, or the pollution is a rights violation. (He owned the property before the pollution occurred, therefore no "right to pollute" actually exists.)

Pollution might be invisible but it isn't undetectable. Technically the new homeowner should be evaluating the land he is settling to establish a baseline level of pollution to compare with any future increase. This might be something handled at a larger scale of a property management company having this done at the same time sites are being checked for sinkholes or whatever. Also, what may be more practicable and how de facto pollution law is handled would be monitoring polluters at the source. What sort of arrangements would evolve from millions of people and firms I can't accurately predict, but I think we can get an idea.

Which security provider would you choose to pay for, one who forced industrial firms to comply with pollution monitoring and good manufacturing practice or one who let it slide? I'm not claiming the world will suddenly be paradise, but I think that when people have a choice, they would choose firms that do punish property rights violations like pollution (obviously other factors to consider as well).

Maybe a hypothetical benevolent dictator is going to have advantages at some point, but as a whole dictators tend to not be benevolent and even when they are locktight on one issue they fall down on many others. There are two main reasons why we say that a free market in law is better regarding pollution compared to state systems:

- Rights violations would tend to be compensated by payment to victims, not fines to some bureaucratic EPA. This is just part of the broader problem with authoritarian or centralized legal systems.

- The same incentive problem that occurs with temporary, democratically-elected rulers happens with government "ownership" of land. When land is rented to a logging or mining firm, rather than them having to buy it, forests are clear cut or mountains are stripped right off. Even when laws are made against these practices, they're ignored (http://articles.latimes.com/1985-09-01/news/mn-25724_1_strip-mining).

There's all sorts of evidence (http://www.ted.com/talks/rob_harmon_how_the_market_can_keep_streams_flowing.html) of state "solutions" failing and privatization suddenly curing environmental problems.

You're confusing what I am talking about with a "Pigovian system". Pigou suggests a tax. Necessarily a tax involves a government, and the socialist calculation problem is no less insurmountable in the case of environmental policy than in any other. A main point in Block's refutation (https://mises.org/journals/jls/1_2/1_2_4.pdf) of Coase (and Demsetz) is that psychic profit is ignored, a very common mistake for those with the mentality of central planners.

In that case, how do you solve the factory owner blackmail problem? I can buy land near a multi-million dollar factory and use my land in a way that creates arbitrarily high damages. Say, for example, the pollution is highly toxic to bees. I can bring in the world's most valuable and sensitive bees, wait for them to die, and then make him pay my full cost. I can keep doing this until he pays me millions to stop, or he shuts down his factory.

My objection applies to any scheme were polluters pay for all the damages, whether the payments are imposed by taxes or otherwise. While the pollution is the fault of the polluter, the damage the pollution does is the fault of the relationship between the pollution and the thing damaged. That is not something entirely under the polluter's control.

So assuming a free-market and the pollution problem.  You mention a multi-million dollar factory. . .which is going to need investors and some form of insurance.  The large-scale factory is only ideal/preferable within the confines of the capitalist/statist system (like our current one).

A read through "Organization Theory" and "New Home Brew" is recommended.  Without coercive government subsidizing, large plants are not feasible.  Their efficiency is not at the highest.

So there are no computers in your ideal world?

You guys are too funny!

So no computers (as mentioned above), no car, no ships, no mass production of ANYTHING, no food processing, etc.

Sign me up!  Sounds like a great place to live.

Again, a read through Organization Theory is recommended.  Large plants are inefficient, and not necessary to produce the goods you list.

Give me the short version. How do you make something like a GPU without a large plant?

As always, you're oversimplifying.  I have a BS in business adminstration, I've done more than a read through of organizational theory.


Regardless, I will not entertain this completely irrelevant, distractionary strawman any longer.  Please go back and answer his question about pollution blackmail.

Still haven't met one

You claim I am oversimplifying, yet you bring no actual criticism of my claim
I answer posts as I will.  If someone wants to engage in an actual discussion with me, you can pm me for my public key.  Done more than a read-through of "Organizational Theory" have you?  You'd think someone with a BS-degree would have better reading comprehension

It was a dry attempt at humor. My point was precisely that it refutes an argument that one is very unlikely to actually encounter.

I'm not going to disprove a claim that you've shown no proof of, not to mention the fact that it's COMPLETELY IRRELEVANT to the question he asked you.

you keep saying "he", but pronouns are notoriously fickle on forums. . .who asked what?  I did not see anyone asking me specifically anything

Way to put the "BS" in "BS-degree"

We're all lol'ing as you cop out of answering direct questions.

The real problem here is that the existing system is horrible... so it creates some issues when we try to change it. There's no real place in libertarian law for nations and wars, but that is what we are faced with at the onset.

I don't understand your hypo about just going and buying land. If you are buying land from someone, did the seller have a preexisting agreement with the polluter allowing the firm to keep polluting? When that person homesteaded the land were they the latecomer in comparison to the polluter? If the answer to either of these questions is yes, then the ability of a 3rd party to pollute is part of the title to the land and would be transferred along to you when you buy it.

Since no system like this really exists today, yes there will be some winners and losers when the dust all settles. It has to happen eventually though. There's legal mechanisms to prevent the type of gouging scheme you want to run, even if you would otherwise legitimately be owed damages.


I don't understand what your objection is... here's what you wrote:


"Coase rained on that parade"? Not much of an argument.

Nobody just goes and acquires the right to pollute by paying off most of the homesteaders which were first. If you don't want to accept payment from some industrial plant that wants to come do business in your area, but they come and start dumping mercury in the stream running to your fishing pond, it's an ongoing rights violation whether or not anything is done about it.

If you didn't notice the mercury in a river before you decided to move there and start farming fish, too bad, you need to do due diligence. If somebody all of a sudden moves in and starts polluting your land though, they don't "get free reign" just because you don't notice right away. You would be able to seek pretty severe damages if it were found out. There's plenty of environmental monitoring tools available nowadays. The market can sort it out. I don't really see what the problem is or how any state system somehow solves it.

You're calling the nature of the thing getting hit with pollution into question... Okay, well that is true that the damage depends on what is damaged, but that is all the more reason for polluters to be careful. I don't see why this is a problem or how it follows that authoritarian systems somehow handle things better.

See those cute little buttons at the top-right of each post that says "Quote".

When you're composing a message, you can scroll down through the discussion and click "Insert Quote". 

I'm not going to review entire threads looking for where someone asked me a direct question, my eyesight is terminally fucked due to MS.  If you could KINDLY quote the question you keep referencing (or for fucksake at least mention WHO asked the question so I can ctrl+f the username), it has a lot better chance of being answered.

No.

No, but it doesn't matter either way.


And what would those mechanisms be?

A legal scheme were the polluter pays all damages just doesn't work because the polluter doesn't have control over the damages. Yes, it pushes all the problems in the other direction, but they're equally serious in either direction.

Either the factory can stop me from starting a beekeeping business. Or I can start a beekeeping business and blackmail the factory. Neither answer is satisfactory. This is simply a hard problem -- for any system.

The problem with our system is what you're solving in the paragraph above. But in exchange you create the opposite problem on the other end.

If you want to argue that a polluter can homestead the right to pollute then you also have to give people who are not direct victims of the pollution the right to sue. If a polluter makes it so that I cannot run a beekeeping business on my land, that reduces the value of my land even if I have no intention of operating a beekeeping business as I might sell to someone who wants to do that. So can I sue over hypothetical damages for every possible future use? Or do I just have to sit back and watch as a polluter drops the value of my land drastically just because I'm not currently using it?

There is no easy solution. The Pigovian solution (polluter pays) doesn't work for the reasons Coase explained.

If I start an airport next to some unowned land and then you move there and tell me to shut down my airport, that's absurd. I was there first. I homesteaded the rights to pollute. If, however, I build an airport next to some previously owned land then you have the right to tell me to stop the noise. It's all about who was there first.


You can sue over every form of pollution if you were there first.

Say we reach the point where pretty much all land is owned. You want to buy some land to build a factory. Surely it has to be possible to put land to new uses. I submit that you will never come up with a set of rules that handles the types of cases I'm describing. For example:

1) You want to operate a factory. It causes no direct damages to any current uses. But it means the people on land adjacent to the factory cannot ever open a beekeeping business. Do you have to compensate them for the loss of potential use? If not, do you gain the right to continue that pollution even if they do wish to open a beekeeping business?

2) You want to operate a factory. There is a beekeeping business that will suffer slight damages. You pay those damages. Then they add thousands of super-expensive bees and demand you pay for the harm to them all. Do you have to pay unlimited damages as they add to them? Or do they lose the right to expand their business just because you opened a factory?

And so on and so on. Again, this is a *hard* problem. Fair solutions to many of these cases simply are not known. Read the article by Coase that I cited. It explains why there aren't going to be simple solutions -- in any system.

1) No, if they want to start a bee-keeping business, they can move. Even in a 100% owned environment, there will always be someone selling.

2) No, that's a clear case of extortion, and no rational Arbitrator is going to let that fly. If you want to expand, Buy land elsewhere. You knew when you agreed with the factory (the damage assessment came from somewhere, yes?) that expansion, at least here, would be difficult or impossible. If you knew you wanted to expand, you should have asked for the cost of moving, in the initial damages.

And no, I don't think it's hard, I don't think fair solutions are impossible, All it takes is a little common sense.

So a polluter can deprive property owners of any value in their land that comes from uses they aren't currently exploiting, and they're entitled to no compensation. That doesn't seem fair. The value of land comes from the value of all of its possible uses. A polluter who makes some uses impossible reduces the value of other people's land. Why shouldn't he pay for that?

So I can force a polluter to pay to relocate me merely by claiming I wanted to engage in a conflicting use? And I have a deadline to figure what future damages I will suffer from his future pollution. If I have to predict my damages before I suffer them, then he has to compensate me for damages I may never have suffered. If I don't have to predict my damages before I suffer them, then he may have to pay an endless stream of increasing damages as he continues to pollute and I continue to grow my business.

So far as we know, no set of simple rules will work. Many economists have tried to figure out such rules and they have all failed. If you really know a solution to this problem, you should set it out in full detail and share it with the world. Maybe you'll get the Nobel prize for solving the problem Coase got the Nobel for finding.

Seriously, read The Problem of Social Cost. You can find it at http://www.sfu.ca/~allen/CoaseJLE1960.pdf

See the absolute value thread. Value comes from those who value something. if the owners of the land don't value it for it's bee-keeping use, then it's bee-keeping value is 0.


Hmm... I don't believe I said 'force'. Did I say force? Let me check. Nope, I said 'ask'.


It's really not that hard. You get the two people in a room, with someone to guide the discussion, and you let them come to a decision themselves. This is called 'Mediation'.

That will not work. As I've been trying to explain, we have no idea what a fair solution would be. There is no way a mediator can help the parties reach a fair solution unless we have some theoretical basis to understand what would be fair. We do not. Read the paper.

Dude. What is so hard about "Party A and Party B both agree that the solution is fair, ergo the solution is fair"?

Ridiculous... Sorry but it is hard to take anything you say seriously if this is your outlook on things. If I set up a huge rock stadium out in a field, you do not have a right to try and set up a sleep clinic nearby then bitch about me ruining your business.


Hmm, not sure what the legal term would be offhand. What you are saying just flies in the face of reason and justice though. You see that your neighbor is committing a minor trespass like his sprinkler is shooting over the fence into your backyard. You go grab that Picasso you wanted to get an extra few mill. for but didn't want to pay auction fees and lay it where the sprinkler is shooting. The neighbor now owes you the value of the Picasso? Is this your argument?


Seriously, read the refutation. I'll link you again. https://mises.org/journals/jls/1_2/1_2_4.pdf

I've already answered this in my above post. If you were there first, you win. If they were there first, they win.


No company is going to reach a settlement unless it includes conditions that disallow you for suing from further damages. In that case, the company will just have to shut down their operation.


I'm well aware of Ronald Coase. I'm an avid follower of Walter Block. He's got an hour-long lecture critiquing Coase.

Watch it here: http://www.youtube.com/watch?v=Id6glPCLm0E

If you don't want to watch it, I'll explain the flaw with Coase in my own words. Coase ignores the prior-latter distinction. All he sees is that A harms B and B harms A. But that's like saying that if you kick me in the shin, even though you're hurting me, my shin is also hurting your foot. For Libertarians that's just too bad! You shouldn't have kicked me!

This problem isn't hard at all. Who was there first? The other person? Then you lose. My shin was there first. Don't kick it and you won't hurt your foot on it.


Exactly. I don't understand why we have to pretend this is such a subtle and difficult issue. It's not.

There is no person who is there first in any meaningful sense. For all intents and purpose, all land is owned and has always been owned.

The problem is, even if I haven't set up a sleep clinic nearby, part of the value of my land is the ability to set up a sleep clinic on it. When you set up your rock stadium, I am already enjoying the value of my land due to the future possible uses of it. If you deprive me of those future uses, you are depriving me of value.

Say I have an apiary that occupies one acre of my 50 acre plot. Does a factory that kills my bees have to pay only for the value of my one acre apiary? Or does he get to steal the value of my future expansions?

Sorry, there is simply no way to deal with pollution on these principles. It's not even remotely close to sensible.

We're talking about who was there first with the pollution vs. the need for there not being pollution. Let's say that a doctor and a machine shop are next to each other and the machinist starts with his grinding and other noise and the doctor doesn't complain because the doctor has his office on the other side of the building where it doesn't affect him. Now let's say, the doctor later decides to relocate his office to a point where the noise is now a problem. That's too bad, the machinist was there with his noise first.


That's too bad. We don't protect possible futures. You have to have something that will be damaged before the noise is in place and something that is damaged after the noise is in place.


If you were there first with your bees then I have to stop but I only owe you for your current operation. I don't owe you for your future expansion or if you suddenly decide to buy only ultra-expensive rare bees.

To put it another way, When I sell you a sandwich, should I have to compensate you for the cup of coffee that you now cannot buy, because you spent the money on the sandwich?

Keep copping out, man.  I'll keep laughing at your struggle to answer simple questions.  I'm not going to play into the distractionary game.  You were asked direct questions on the last page and you intentionally bypassed them.

Is this the one you're talking about?

He answered here: http://forum.bitcoin.org/index.php?topic=20254.msg286882#msg286882

You really are the king of bad analogies.

Try this more accurate analogy:

If I buy a plot of land, many aspects of not just the property, but the surrounding area as well, go into determining the value of that land.  If, when I buy the land, it is located in the center of nothing but green, grassy fields, that is factored into the value.  If you come along and put a sewage treatment plant right next to my land or run a railroad right past it, you have now massively decreased the value of my land.  You have robbed me of value.

That's not an answer, that's the name of an area of study.

I'm looking for an answer to this:

Yes, and since you were there first, you can receive damages. Thank you for seeing it our way.

Nobody is there first. For all intents and purposes, every piece of land is already used. If you want to argue the plant is a new use, well any future sale of the land at the lower value would be new as well. If someone starts polluting, they won't do any damage in the past. All the damage they do will occur after they started polluting and their polluting will have always been first.

If I pollute a river you drink from, my pollution won't kill you because you drank from the river in the past. It will kill you because, and only because, you drank from the river after I polluted it. Nothing about my drinking from the river yesterday ensures I will drink from the river tomorrow.

[citation needed]

I've read Mintzberg. Does that count?
Inefficient you say? Then why do they become large plants? Are all business leaders morons who like to waste money, or is there some kind of economic incentive to make large plants perhaps? Say, lower cost per unit produced?

Love the thread btw. It's addressing something that's interested me a while. I agree that it doesn't handle externalities well, but do you think it would handle it better than the current system.

Personally, no.  Just ask yourself the simple question: what's the one thing businesses always want to enable them to boost profits.  The answer is always the same: less government regulation.

While the regulation we have is far from perfect, it DOES limit pollution.  Companies routinely relocate to less regulated countries that allow them to pollute more.  They're always chomping at the bit for laxer evironmental standards, which means only one thing: they're currently not allowed to pollute as much as they otherwise would.

I don't follow, how do you know the regulations we have now lower pollution more than the private action scheme he is proposing? Perhaps you aren't fully appreciating the point that in the United States, you generally cannot sue someone for polluting if they are complying with the law.

While Libertarians don't agree with all the nonsensical bureaucratic rules our society has, Libertarians fully expect that the rules that society should have will have and they will be, and should be, ruthlessly and thoroughly enforced. Libertarians are as angry at governments for immunizing big corporations from the consequences of their actions as everyone else is.

By the pure and simple fact that they WANT to pollute more than they currently are and the ONLY thing stopping them is government regulation.


It was already discussed in length why law suits are not a real-world effective method of pollution control, especially in Liberland with a privatized court system (that in itself wouldn't even work, but assuming it did) that would be easily bought out by the large, polluting companies.

But how do you know that government regulation is stopping them from polluting more than it's allowing them to pollute with impunity?

I agree. The legal system is not the best way to deal with polluters. However, a system that explicitly grants polluters the right to pollute with no compensation for the victims of lawful pollution doesn't seem like a very good one either.

I don't think you're naive enough to think the ideal amount of pollution is zero. Heck, that would mean no cooking and no agriculture. We don't have a good theoretical model for what the optimum amount of pollution is. It's entirely possible that our system is allowing too little short-term pollution and stifling the productivity that would allow us to develop cleaner technologies that would minimize harm from pollution on net (how much raw sewage do you see in the streets these days?).

We don't know. So if Libertarianism would allow much more pollution for a given situation, that might actually be a good thing because it would let us get into a situation where people wouldn't even want to pollute as much as they could. We genuinely don't know. This problem is unbelievably hard.

I am not an electronics engineer, so I am therefore not qualified to give a definitive answer.   Sure, call it a cop-out, but I will not act like I have expertise in the field.  I have been convinced (buy logic and evidence) that large factories are  less efficient.  Similar to the economy of scale with respect to agriculture.  The economy of scale with regards to technology and *gasp* political systems follow similar tendencies.

It's a very strange position that you have. You apparently hold the position that nothing important, valuable, and useful can possibly require billions of dollars and thousands of people cooperating over decades. And you defend this position on the grounds that certain particular things don't have those requirements. Yet when people familiar with areas of expertise tell you that things like GPUs, hydroelectric power plants, MRI machines, and satellites do in fact require those things, you say that you are somehow convinced about these specific things based on evidence that isn't about those things.

Yes, some things have diseconomies of scale. There are no nationwide chains of dry cleaners or fine French restaurants for very good reasons. But some things have massive economies of scale. There are very good reasons why Walmart is a nationwide chain that have nothing to do with the political or economic systems but have to do with the advantage of market leverage in securing low prices.

The average person today lives better than the top 1% of the top 1% did in 1600, and one of the major reasons for that is that humans have learned to exploit economies of scale.

And you casually brush aside the part that government subsidy has played in allowing wlmart to get as big as it is?

That's an interesting point that I'm going to have to conceed to you.  At least we agree that the issue is complex (the most important of the points, because everyone around seems to want to oversimply everything), will not be solved by private lawsuits, and Liberland is as likely to make it worse as it is to make it better.

Citation please.  Where is the government subsidy of Walmart?

Tariffs and national highways, just to name a couple.

LOL  Not sure if serious...

Well, actually walmart gets a huge advantage through the use of the tax-funded federal highway system that we all are forced to fund.  It artificially lowers the cost of long-distance transport of goods, thus giving walmart an unfair advantage over your local mom-and-pop store that acquire goods locally.

Regarding tarrifs, most of them end up intentionally or unintentionally benefiting the big players.

Completely untrue, because mom and pop shops make use of public roadways also, as do their customers.  ALL businesses benefit from public roadways directly or indirectly, so that's probably the most ridiculous argument I've ever heard and I hope he isn't serious.

The whole argument that "we all benefit from so-called 'public' roads, therefore we should fund them through violence" is so perverse to begin with.  Assuming no such thing as 'public roads', then that means only those people who use roads or purchase goods/services that used roads would bear the massive costs associated with construction and upkeep of the roads.  So businesses that produce and use goods/services locally would likely be more prevalent in a society without tax-funded roads and highways.

Competing business don't benefit in equal measure, which means the playing field is tilted toward those that benefit the most.

Public roads are a different topic and completely irrelevant to the existence of large manufacturing plants.

Did you forget, Walmart pays taxes too?  They aren't using the roads for free, like you're making it sound.

Walmart disproportionately benefits.

They also pay infinitely more taxes than mom and pop shops.

Show me the numbers or GTFO out.

Sorry, I was too busy partaking in agorist economics (real-time) to follow all your bull and comment on it.  Thankfully, em3rgentOrder and others have more of a sense of self-punishment and are willing to entertain AyeYo's bull

"infinitely more" ??? YOU GTFO, Motherfucker. If Walmart is paying infinite taxes, then we should have no budget deficit, and can afford the skittles-pooping unicorns for everyone.

By use of the word "also", you imply that you do acknowledge a DISPROPORTIONATE benefit. This is wise of you as you would be foolish to argue that locally produced food is transported farther than remotely-produced merchandise.

Show me the numbers or GTFO.  You keep making all these claims about how Walmart is reaping massive benefits from publicly funded roads and it's giving them an advantage, SHOW ME THE NUMBERS.


Also, still wondering how advanced devices like a GPU or such can be manufactured without a massive facility.

Good advice.  :)

Time for me to buy myself a 3D printer...

Mom & pop store buys a shipment of goods. It comes in what is essentially a moving van, dropped off by one guy.

Walmart buys a shipment of goods, it comes in a Semi-truck (Which they own a fleet of), and is unloaded by a team of associates paid to do nothing but.

It's called economy of scale. Walmart has a higher cost per shipment, but a disproportional amount of profit, because they average that cost over a much larger amount of goods. Yet, they pay almost exactly the same amount of taxes, proportional to the cost of shipment. The price of the roads being factored into the gas prices, probably much less (Both trucks run on a diesel engine, but the semi uses less fuel, as a percentage of the profit from the shipment, than does the smaller truck).

SHOW ME THE NUMBERS.

www.google.com (http://www.google.com)

Have fun.

You want to punish WalMart for being effective and utilizing economy of scale?

One word.  Accountability.

No, of course not. I just want to remove the taxes. It may turn out, that without 'Most favored nation status' on China and the subsidized roads, Wal-mart won't be able to keep up with mom-and-pop stores selling locally produced goods. They'd still have economies of scale, and if they can broker a deal with local producers, could probably still push out the mom&pops. The fact of the matter is, we really don't know exactly what would happen, if we didn't have Government making a tweak here, and a tweak there, and just had the system running as it should.

Since you have no idea what you're talking about, I'll post some numbers for you.

http://cdn.walmartstores.com/sites/AnnualReport/2010/PDF/01_WMT%202010_Financials.pdf

Walmart alloted $7.436 BILLION for taxes in 2010 (page 17).

There, I did half your work for you.  Now it's your turn to browse some mom and pop finanical statements and prove your assertion that Walmart pays "almost exactly the same amount of taxes".  Good luck.

compare that as a percentage of their revenue vs. mom&pops

Nope.  Nice try though.

His exact words were: "they pay almost exactly the same amount of taxes, proportional to the cost of shipment"

I got their tax information for him.  Now he can find the rest of the info he needs and do the calculations to prove his claim, otherwise he's just pulling statements out of his ass.

Good. Now, find me how much walmart paid, nationally, for incoming goods. THEN you will have done half my work for me. Then I'll walk down to the corner and ask the owner of the convenience store.

You put in your own work around here.  You want to be taken seriously and not just laughed at as the angry little kid in the room, then provide proof for your claims.  Otherwise I'll just start laughing at everything you say.


Still waiting to hear how high tech and complex products can be made without massive facilities.

They don't pay for incoming goods per se.  They pay shipping and import costs.  The stuff they sell at Walmart in China is mostly the same stuff right down the English labelling.  It's more of an internal transport of goods.

Assuming that the numbers in that chart on page 30 (not 17, learn to read page numbers) Are in fact in the billions, which is a reasonable assumption, though in my perusal of the document I did not find specific information saying so, Walmart paid 304.657 billion as 'Cost of sales' (in other words, incoming goods.) Actual numbers are moot, however, since we're dealing with percentages here. Expressed as a percentage of cost of incoming goods, Walmart paid 2.44% in taxes. If you include operating costs (since walmart doesn't split off numbers for their shipping arm in this document, we'll have to) That adds another 79 billion, bringing the total percentage down to 1.9% But even that's not exactly accurate, since for it to be accurate, the tax has to be considered a part of that operating expense, so we have to add that in, bringing the percentage down to 1.8%

But ALL of this is irrelevant, since the specific taxes I was speaking about was the GAS tax which is what actually goes to fund the roads, and the number you quoted above was the INCOME tax.

I don't need to do any math at all to show that carrying 16 pallets in a semi is more fuel-efficient than carrying 1 pallet's worth of individual items in a small diesel truck. Proportional to the cost of one shipment, Walmart pays less in GAS TAX per shipment than does the Mom & Pop. In a free market system, Mom & Pops who sell locally produced items would handily be able to compete with the 'big box' stores which ship their goods in from all over, since the actual cost of shipping that banana in from Peru would be reflected in the price, and not externalized to the taxpayers via trade subsidies, gas taxes, and other factors.

Of course Wal-Mart doesn't pay the same amount of taxes. They have government lee-way.

LOLOLOLOL At you not knowing how to read financial statements.  Let me learn you a little something...

First off, page 30 is about uncertain tax positions, which are exactly what their name implies. haha

Anyway, page 17 is the income statement, if you look 1/3 of the way down you'll see "provisions for income taxes".  "Current" is the amount the company has set aside to pay taxes for the fiscal year indicated.  "Deferred" is what's left over (or extra owed) from whether the estimate was too high/too low from last fiscal year.

Furthermore, there's small text at the top left of almost every statement that says "amounts in millions except share date" or "amounts in millions unless otherwise indicated". ::)


As for the rest of it...

Income tax is NOT part of operating expenses, property taxes are though, something you're failing to factor into the taxes they paid. 

How on earth do you find it logical to use cost of goods sold AND operating expenses to show... the cost of shipping goods? LOLOLOLOL  Do you realize how much stuff is included in operating expenses?  Do you realize that cost of goods sold is NOT just tranporation costs, but also the actual cost of the goods?




See, you NEED to provide EVIDENCE and NUMBERS to back up those kind of bullshit claims... otherwise they'll remain bullshit claims.

Assuming the above poster is referring to the highlighted text in his quote I can only say Are You Retarded?  It makes plain sense for those having Common Sense.

"See, you NEED to provide EVIDENCE and NUMBERS to back up those kind of bullshit claims... otherwise they'll remain bullshit claims."

Yeah, I'm putting this guy on ignore. The arrogance isn't tolerable any longer.

You know, coming from anyone else, I might take this seriously. From you... From you, I can't help but laugh as I think back to all the other BS claims you've made.

That's fine, and you can get away with that here because most people here agree with you.  Just an FYI though, when you step out of your circle of people that already agree with you, you'll be required to back up your bold claims or you'll be laughed into oblivion.




There's just one problem with "common sense" answers to complex situations... they're almost never right.

Funny fact: TheGer and I, we disagree on a lot of things. I think the main problem with common sense is that it's not as common as it should be.

http://www.don-lindsay-archive.org/skeptic/arguments.html#complexity