Re: Understanding The Libertarian Philosophy




Bill Samuel wrote:

Engineer wrote:

In addition to it being morally wrong, it's not effective.
Racist sellers incur market penalties and cannot compete with
no-racist sellers. In a free market doing things that reduce
profits for no rational reason attracts competition that doesn't
domthose sorts of things. Consider the hypothetical you wrote
above. And assume that the free-market price is $5/liter.
(which is to say that multiple sellers compete to have the
lowest price, but can't go lower than $5/liter without going
out of business.) That water seller is losing money by
selling too cheaply to whites, and will go bankrupt. Now
assume that the free-market price is $2/liter. The brown
skinned buyers will go elsewhere, and someone will sell
to them in order to make money.

This is ideology triumphing over fact. We have plenty of experience
in this country with racist businesspeople who took actions that the
clearly mistaken assumptions of laissez faire economics would say were
not supportable and would fail because they don't make theoretical
economic sense. But in fact people are not economic automatons and
often don't act in ways that are compatible with the economic theory.
And Engineer's economic theory just doesn't properly account for a lot
of things that happen in real life.

We know that many racist businesses survived for a long time. Most of
them did not change their ways due to a rational application of
economic theory. They changed their ways due to legal requirements.
Now, after they changed their ways because their discriminatory
practices were declared illegal, many of them realized that the new
way made more sense and appreciated it.

If you look at the history of such businesses, you will find that
force was used to stop competing non-discrimitory businesses from
entering the market and competing. This force came from government
in the form of the zoning and licensing restrictions that businesses
use to stifle competition and in the form of threats by the Klan.

When Rosa Parks refused to give up her bus seat for a white, a
police officer arrested her for violating a law requiring blacks
to sit in the back of the bus. That was *government* racism.
the government, of course, is immune to free market cometition.

I do not deny that there were racist and discriminatory business
owners. What I am saying is that force -- usually the government
through Jim Crow laws ( http://en.wikipedia.org/wiki/Jim_Crow_law )
but sometimes through violent racist groups that were not stopped
by the government -- was used to stop anyone from setting up shop
across the street, not discriminating and thus being more profitable,
and using those profits to lower prices below the lowest that the
racist businesses could survive on. Ignoring those laws and the
reason why they were passed -- ignoring what it is that they were
making illegal -- is a good example of ideology triumphing over fact.


.

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