Brexit: Politics Is About Picking Winners And Losers

The outcome of the EU Referendum for the UK to exit the EU has caused an enormous outrage among the ruling class in the UK and also in other EU states. As they always do they had mobilised all their power and influence to scare people into voting for the EU membership. They have a lot of experience doing this and it usually gets them what they want.

Not this time! This time the question on the ballot box was very simple. This time it was a direct vote count, and the majority won. This time, people made up their own mind and voted out. They did so for various reasons, but undeniably a good part of it was a protest against the current political order. They felt that their voice was not being heart. They felt that the system did what it wants and did not serve them.

The reaction of the elites in this countries reveals that their instinct was correct. The amount of contempt against anyone who dared to vote out is unbelievable. I am not shy in stating my opinion and I am used to not get applause for it. But even I caught myself trying, in some conversations, to hide the fact that I had sympathy for an out vote.

In all of the public discourse about this vote the underlying assumption is clear. This was a mistake, brought about by uneducated, xenophobic and even senile working class people who were seduced by evil powers. Everyone who can think rationally, anyone who truly understood the question and everyone who is a decent person could have only possibly voted for staying in the Union.

These people show that they do not like being challenged in their political world view. Everyone can see now how arrogantly they think they know better than everyone else and therefore no one should oppose them. Most importantly though, these people clearly show that they are not used to losing. They are the once who are on the winning side of the system. And suddenly they find themselves on the side of the losers and cannot deal with it. A lot of them have called for a new referendum, since clearly too many people did not understand what they were voting on. They are even trying to figure out if there is any way with which they can ignore the outcome of it.

Don’t get me wrong. I can see that this referendum gets some people into trouble that do not deserve it. I talked to a lot of EU friends in the UK of mine, who are now wondering whether they can stay or not. They probably can, but most definitely facing a lot of new bureaucracy to do so. This referendum was not a clear cut case from a libertarian point of view. There are winners and there are losers. The reason why I am like the out vote is, because this actually changes the political system itself and I think the new order will overall advance liberty. I have explained this in detail in my article “Why the EU is the wrong tool to defeat nationalism”. But still there are losers in this, who should not be losers.

But the point that the elitist remainers do not seem to understand is that politics is always about picking winners and losers. That is how the system works. So finding yourself on the side of the losers for once, or let us be honest here, finding yourself on the side of having to give up some of the privileges, which is not the same as losing, is not an argument that there must have been a mistake. Only on the free market everyone wins. In Politics, someone always has to lose. So if you really want a system in which no one losers, you will need to advocate a system of liberty.

That lesson however, no one in the elite really seems to want to learn. Instead they hope by moaning, kicking and screaming they can go back to the system in which the losers are the others. And you know what, this time this will be difficult, but unfortunately they have a very realistic chance of achieving this goal. Let us use this chance to expose them, to make it as difficult as possible for them.

Orlando – Let us Talk About Islam

The massacre of gay people in Orlando this weekend is another one in a serious of similar events in different western countries in the past couple of years. They seem to increase in frequency, which is obviously not a good sign.

Once again all political fractions are using this tragedy to confirm their beliefs. The political correct crowd is trying to focus on the anti-gay nature of the crime and tries hard to avoid any hint that there might be something wrong with Islam. The right does the opposite. For them it is another proof that Islam as a whole is evil and needs to be defeated. 

What happened in Orlando seems to be very similar to the attacks in Paris and Brussels. All the attackers were born and raised in western countries. All seem to have been estranged from the society they grow up in and all seem to have shown a distinct lust for violence in their private lives. It is not a new phenomenon that people who feel estranged from society burst out in extreme acts of violence. This can be observed over and over again.

What is relatively new is that today, these people turn to Islam in order to justify their crimes. I do not believe for a minute that this is the only way to interpret Islam. If it was, we would probably already annihilated by the islamic world, which is a lot bigger than the west. Like any religion, Islam can mean whatever you want it to mean. These are not scientific theories that people believe because they have read an empirical study. They are ideologies of how people want to see the world. And there are very moderate teachers of Islam that are just as shocked as everyone else about massacres like these.

But it is undeniable that if you are a violent psychopath, Islam seems to have a special attractiveness these days. So for some reason, very radical and totalitarian interpretations of Islam are winning. To me it looks like the main reason for that is our foreign policy. The radicals can, to some degree correctly paint the image of a western war against Islam. And if you are in a war, dissenting from a radical script is very difficult. Either you are with us or you are with them. There is no place for gray in war propaganda.

Still, there have always been radical teachings of Islam. Western policies might play into the hands of these forces, but they were not created by them. That means, we also need to talk seriously about Islam. But this is very difficult in a western society that has political correctness as a more and more dominating civil religion. To a lot of people, and I must say particularly young people, offending other people’s beliefs seems unacceptable. And by offence they often already mean, making any argument against a belief.

However, ridicule is the best tool available against dogmatic cults. You first need to get them to listen to an argument. And for that you need to make fun of their dogmatic nature so that they are under pressure to talk to you. Telling them that they have a right to a safe  space, where they are not offended, is not helping. We have a problem. And we need free speech and open debate to identify exactly what the problem is. Otherwise we will never find the right solutions.

Railway privatisation in America

The history of railways in Britain follows a similar pattern that found throughout Europe and much of the world. The railways were built by private companies, which later merged and combined and were ultimately nationalised into a single, state-run operator. Britain is of course unusual in having since privatised its rail network again, notionally at least, with trains now run by a mixture of private companies on rails owned by a single publically owned body, Network Rail. Elsewhere in Europe, publically owned rails are increasingly opened to private rail operators under the European Union’s Directive 91/440/EC.
However, in North America, the opposite situation exists. The United States is one of the few countries that never truly nationalised its railways. However the government did indirectly take charge of passenger services by forming Amtrak in 1971. This has led to a situation where a national passenger operator, supported by state subsidy, operates a network over lines owned and maintained by numerous private freight railroads.
The formation of Amtrak in 1971 came at the end of a long story of decline for America’s passenger rail services. Trains were seen as an outmoded form of travel, supplanted by the automobile and the passenger airliner. Both road and air travel were receiving massive state assistance through the building of the Interstate network and new airports and air traffic control infrastructure. Meanwhile passenger railroads were struggling to compete, held back by overbearing taxation and political conflict over the proper way to assist the industry, should it be assisted at all.

With railroads continuing to fail, public pressure mounted to save passenger services. However the Democrats were unwilling to subsidise the for-profit private railroad companies, and the Republicans were opposed to nationalisation. This situation led to the decision to create a publically supported body that would take over passenger services from the private operators. While some private services lingered on into the 1980s, the majority chose to shed their services to the new operator.

Fast forward thirty five years and today’s Amtrak network is a mere shadow of the services it inherited in 1971. The ongoing drive to bring it closer to financial independence has left a dwindling system of slow, infrequent services appealing largely to leisure travellers. Two of the contiguous states are completely without service, and away from the key North East Corridor and Californian Coast routes, trains are not seen as a viable way of travelling compared to the extensive Interstate and airline networks.

Freight railroads, however, continue to be a lucrative industry, and a series of mergers has led to a few titans like BNSF, Union Pacific, Kansas City Southern and CSX controlling vast networks that span the country. On these lines speeds are slow, the networks being designed for America’s distinctive multi-mile long lumbering freight trains. While efforts to create new high-speed lines have been underway in several states, none have so far come to fruition, and no high speed trains operate (by the European definition of 200km/h) outside of the Boston-Washington DC North East Corridor, the only substantial area where Amtrak has control of its own rails.

The benefits of vertical integration here are as obvious as they are in the British system. Having operator and infrastructure be the same organisation avoids conflicting priorities and makes sure infrastructure operators are responsible for the punctuality of the trains using their rails. Whether it’s Amtrak running on Union Pacific metals in the US, or London Midland running on Network Rail ones in the UK, the hybrid of public and private ownership seems to create more problems than it solves.

It’s easy to assume that the solution to this is a single nationalised network, but this removes all opportunity for competition and shifts accountability from the passenger to the taxpayer. Instead, the proper solution in 1971 would have been to level the playing field between railroads, airlines and road transport, allowing private operators to continue operating their own services without government driving investment into competing modes.

Fortunately, there is now a glimmer of hope on the horizon. In Florida, the first of a new breed of private passenger railroad is emerging. The curiously named ‘Go Brightline’ is a private sector project to link Orlando, Fort Lauderdale and Miami with fast, modern services positioned to compete with road and air travel. For the first time in nearly four decades, privately operated passenger trains will link American cities along tracks owned by the same operator.
Despite the radically different geography, America, like Britain, provides a clear case study of how separating operation and infrastructure produces the wrong outcomes for the passenger. All too often this is ascribed to the failure of privatisation, but neither passenger system is truly in private operation. One place where railways are truly privatised is Japan, a country which enjoys a thriving passenger rail network that easily ranks as one of the best in the world.

It will be interesting to watch the progress of the Go Brightline project as it begins operating over the next few years. Hopefully it will demonstrate how true private operation can present a viable alternative, both to the inadequate Amtrak network and to proposed multi-billion dollar public sector projects that are rightly so off-putting to the American electorate.

Dismantling The Basic Income Proposal

The basic income is an idea that is being discussed in many countries and political circles at the moment. The idea is to give every citizen of a state a certain amount of money, unconditionally every month. It is in essence a proposal to organize the welfare state differently to make it work better.

Understanding economics, this, on the surface, seems like big nonsense. And if you dig deeper you will find that indeed it is. However, amazingly, this idea has even won the support of some people who are sympathetic to free markets.

One of the people who supported this idea, in form of a negative income tax, was Milton Friedman. And in the UK, the Friedman worshiping think tank The Adam Smith Institute, openly supports the approach. So unfortunately, it seems the proposal cannot just being ignored as obviously bad. Some time needs to be spend addressing the arguments and showing why it is a bad idea.

To start with, I want to emphasize that a basic income, provided by the state is of course completely incompatible with libertarianism. Any form of wealth distribution via mandatory taxes is a blatant violation of people’s liberty. However, there are people who do not argue from principles. They think of themselves as pragmatic. People who think of themselves as pragmatic are usually confused about philosophy. They do not want to put things into a broader moral theory. Instead they take every situation one at a time.

Of course principled people tend to choose their principles in the hope that following them will lead to reliably good results. They are therefore just as “pragmatic” as people who reject principles. But since they have a broader theory, they tend to be more successful in achieving their goals. So my aim in this article is to show that following libertarian principles, and rejecting the basic income, indeed leads to better results.

Why do people support the basic income?

There seems to be two groups of supporters. Those who truly believe that the basic income is a good policy and those, more libertarian leaning, who believe that it is the lesser evil. However, looking a little bit closer, it seems that the ones pretending that it is a lessor evil, really seem to buy into some of the basic falsehoods of the real supporters.

So we really can address both groups in the same way. Last year, the Adam Smith Institute published a piece explaining their support for the basic income. Let us take this as a basis to show, why their support is misguided.

The basic income deals with in work poverty

The basic idea of a welfare state is, to use taxation to redistribute wealth from wealthy people to the poor. So far, the poor were meant to be people, who, for whatever reason, were unable to work and provide a living for themselves. That is why, in almost every welfare system, people who want to claim benefits, somehow need to show that they are out of work and unable to provide for themselves.

This makes a lot of sense. It is difficult to make a moral argument in favor of people being able to claim the product of other people’s labour, when they could work themselves. This is too obviously a form of exploitation.

Enter the basic income proposal. It makes an argument that it does indeed make sense to give free capital to people who are able to, and ofter are working. One of the arguments for this, is supposed to be a moral one. The idea here is that in our time, a lot of jobs do not provide enough income to make a decent living. We are told that:

“The clearing power of lower skilled labour is simply not high enough, to provide what electoral willpower, political stability and innovation would require: some form of welfare income policy is necessary.”

This is a conclusion that is being presented after an economic analysis. The analysis is based on piecemeal data collection which allegedly shows that globalization and technology have replaced a lot of unskilled labour. Therefore, low skilled workers cannot make ends meet on their own in a modern economy. The solution is that these workers need to be helped with the incomes of higher skilled workers.

Far from being new, this argument has always been the basic idea behind the welfare state. There are losers in the market place. Therefore, we need welfare politics to balance out the inequality that markets produce. Once the need for welfare is established, the argument then shifts towards what is the best way of providing welfare.

The truth however seems to be that, neither is there a need for state welfare programs, nor would the basic income be the best welfare program if there were such a need.

The reason for poverty is the state

But first things first. Why is there no need for state welfare programs? The answer can be found in economics. Real economics that is. The economics presented in the defense of the basic income, is a good example of how not to do economics. One cannot understand economics by simply analyzing random data and try to find correlations. The foundation of every economic analysis needs to be based on principles of human action. If we do not start with these principles, we are at constant risk of missing at least half of the picture. And if we only understand half of the picture, we, at best, only get it half right. Half right however, is still very much wrong.

This was best explained in Frederic Bastiat’s genius article “That Which is Seen and That Which is Not Seen”. Let us say we have a policy of taking money from a person and spending it on a good A. What we can see now is that the demand for this good A is going up. However, there is of course another side to this policy. Since money can only be spend once, if the money is spend on good A, it is not spend on another good B, which was the original choice of that person to spend his money on. But we cannot see the non transaction of not buying B. We only see the transaction of buying A. Reasoning however tells us, that this non transaction must most likely be true, and we need to take it into account when we examine the economy. So if we were to analyze the situation purely by statistical data, we are doomed to miss half of the effects of that policy. Only arguing from principles can tell us about the full picture.

This is very relevant in this analysis of what is happening in a modern economy. What we see is that markets become more global. What we see is that more and more things are being done with computers. What we see is that it is more and more difficult for low skilled workers to find jobs and that the jobs they can find are often not providing them with a decent standard of living. If you piecemeal all of this data together, you come to the obvious conclusion that the modern economy lets low skilled workers behind.

None of this data is of course wrong. But it is only half of the picture. The other half is much more difficult to see in statistics and can only really be understood indirectly by reasoning from sound economics principles.

Unlike a lot of austrians today, I do not believe that these principles are a priori correct. Mises’ praxeology method unfortunately seems wrong. The principles of human action can be observed and tested. And every scientific theory, including the austrian school of economics, should be tested. There seems no other way of knowing whether a theory describes reality correctly or not.

But despite this little confusion in the modern austrian school fellowship (of course historically, Mises was the only austrian economist who thought austrian economics was a priori true), the great thing about the austrian school is that its predictions seem to pass the test.

One of the predictions that the austrians have made is that state intervention into the economy leads to misallocations of capital. These misallocations in the economy lead to a loss of productivity and to a crisis when these misallocations are being discovered. This crises is then being addressed by more state intervention, which leads to more loss of productivity etc. A loss of productivity means that not as much wealth is being produced as it could be. Through more and more state interventions in the economy, in the long run, the economy is so distorted and unproductive that it literally start to destroy existing wealth. That is because, at some point, more wealth is being consumed than produced. This then constantly reduces the amount of capital available and makes production more and more difficult.

Other than described in the article, technological progress is the other big factor that increases productivity. So this is not in the way of a good life for the poor. It should make life more and more affordable.

More capital accumulation and an increase in technology should therefore lead to a huge deflation that makes lives more and more affordable. We should be at a point now where being able to afford a roof above our heads and food on the table is possible with a minimum amount of work.

What we are seeing instead, just like the austrians predicted analyzing state interventions, is a constant increase in the costs of living. People have to spend more and more of their salary to be able to afford a home. And even prices of food in the supermarket are constantly going up. As a reasult, people who have low incomes have trouble to make a living. That this is going on despite the huge advances in technology and despite the huge increase of people taking part in work sharing worldwide in the last 25 years, tells us a lot about how wealth destructive our economies have become.

This is a very different analysis from the one presented by the defenders of a basic income. Therefore, it is clear that it is important to get the economics right. If the austrians are correct, then not only is welfare not needed to provide for the poor, welfare is the reason why we have so much poverty. And if that is true then creating more welfare programs will only crush the poor even more. The poor, more than anyone else, need to be freed from the welfare state.

Does the basic income reduce the welfare state

But then there is the argument that the basic income is actually the better deal to the existing welfare state. It makes the welfare state more efficient and therefore reduces the negative effects of it. Or it may even reduce the welfare state all together.

But this does not seem to be correct. At least not if we really talking about a basic income that provides for a living. Let us first look at the assumption that it makes the welfare state more efficient. The argument is that if everyone gets a basic income unconditionally, there is no need for all the bureaucracy involved in applying and testing eligibility for benefits. This may be true, if we really replace the whole welfare state with a basic income, but that does not necessarily mean it is a good thing. Making tyranny more efficient does not make it any better.

Bureaucracy is nasty, no doubt. However, it is a symptom not a cause of evil. Bureaucracy is the tool to put some constrains on a monopoly of power. Getting rid of this restrain does not help us. It is the state programs that the bureaucracy tries to facilitate that are the problem. Just abolishing the bureaucracy without the state program is usually not helping. As long as we have a state, we will have to live with some bureaucracy. The real solution to the bureaucracy problem is to abolish the state altogether.

The second argument is that the basic income reduces the costs or the negative economic effects of the welfare state. Whether this is true or not seem to depend on how high the basic income is and how it is going to be implemented. The problem is that as soon as the basic income is high enough to actually make a living out of it, the answer seems to be no.

Of course if we had a very low basic income of say £100, then that would be great. No one can live on £100 per month. That means everyone would basically go out and work and pay for the £100 with their taxes themselves. Such a low basic income would essentially be a trick to more or less abolish the welfare state. Great! The problem is, it is too obviously a trick. We might as well be honest and advocate the abolition of the welfare state.

If we take the idea seriously we need to have the basic income set at a level that provides a basic standard of living. What is the lowest amount we might argue for? Assuming that we realistically keep the NHS and replace the rest of the welfare state, we might say we give a person £200 a month for food and £400 to rent a small single room somewhere. That will mean £600 per month per person.

Assuming there are 60 million people in the UK, this basic income would cost the taxpayer 432 billion pound a year. Currently the expense for welfare and pensions together is about 260 billion. And that is assuming you could replace pensions with such a low basic income. So even this very minimal basic income would be hugely more expensive than the current welfare system. That is no good.

A better way of implementing it is to slowly phase it out like a negative income tax. So if you don’t work you get £7200. If you start working you will get less and less until you start paying income tax on everything you earn above £7200. The problem with this is clear. Anyone who does not earn significantly more than £7200 will have a big incentive not to work at least not officially.

To avoid that, another proposal, to implement the basic income, is to give people a top up on their earnings until a tax free allowance. Let us assume we have a basic income of £7000 and a tax free allowance of £12000. if you earn nothing, you get your £7000. If you earn something you get a top up of 50% of the different of the tax free allowance and your income. So if you earn £6000, you get another 50% of £12000-£6000. That is £3000, so your total income would be £9000.

There is a problem with this though. It seems expensive. For this to not have big negative effects, the tax free allowance need to be significantly higher than the basic income. Of course I am all for high tax free allowances, it should be 100% of your income. But if you want a basic income, someone needs to pay for it. The lower the tax free allowance is, the less you can keep from your earnings. In the example above, you need to earn £6000 to make an extra £2000. Even if the tax free allowance is twice the basic income, you still need to earn £2 to have an extra pound in your pocket. This does not seem to encourage people to work.

Advocates of the basic income might counter this by saying that the current system is a disaster to encourage people to work, because someone loses all his benefits once he starts working. With the basic income however, he just loses some.

That is true, but it overlooks that everyone gets the basic income unconditionally. At the moment, you still will have to go to the state and ask for benefits. For a lot of people, this is still something embarrassing to do. And of course there are conditions to get the money. It becomes only an option if they are really desperate. But you don’t have to apply for the basic income. This is presented as some kind of natural right of a citizen. As a result, even ordinary people will take it into account in their ordinary financial planning.

They might start looking for nicer jobs, to top up their basic income. Say for example someone is trying to make a living as an actor. Unless he is famous, he can most likely not make a living out of this. But he might make a few bucks with a gig here and there. Currently, a lot of these people take small jobs in bars or hotels to cover their basic costs. With a basic income, they might just top their government check up with a few gigs. No need to do some real work anymore. Yes, living on £7200 might be difficult. But then, going out and clean toilets full time, just to top up your basic income a bit, might not be worth the hassle. Never underestimate the value of leisure. Whether it would be worth it or not, would of course depend on how miserable you are living on your basic income.

But there are two problems with a very low basic income. The first is, that, once introduced, it will be politically difficult to keep it very low. People will start seeing it as their right as a citizen and start making the argument that this low level is violating their right. People already make these arguments with current benefits. Luckily, the latter are still very much conditional.

The second problem is, that if we were to replace the welfare state with a basic income and than manage to keep it very low, this would hit people, who really do need help, because they are not able to make a living, very hard. They would be unable to make a good living out of the basic income. Simultaneously, they would be deprived of other roots of income. In a society, in which the general mindset is that the state has to care for the poor, it is very difficult to set up private alternatives to the welfare state. So these really weak people, the once that the welfare state was originally designed to help, they would probably be the biggest losers of the basic income.

Now, you might say, well we just give those people a bit more. But then you are essentially starting the welfare state, that we have at the moment, all over again. Immediately, other groups will come and say that they too, will need something extra. In that case, the basic income would not replace the welfare state, but would essentially become an extra on top of it (which is something some socialist argue for anyway). It is as always in politics. It constantly tries to solve the latest problem that would not exists if it wasn’t for politic’s last solution.

Conclusions

No matter how you look at the basic income proposal, it does not seem to produce any good results. If it is set at a decent level, it is very expansive and would hugely discourage people from work. The lower it is set, the less damage it causes to the economy and society. But even set at a level, at which it might not lead to a collapse of the economy, it would still be a very destructive policy. And the really poor and helpless would be the ones to suffer the most under it.

Ultimately, libertarians are correct. Liberty is the solution, not trying to make the state more efficient. If we really want to help the poor, and live in a prosperous society, we need to get rid of the welfare state. There is no alternative to it.

The Collateral Damage Problem in “Eye in the Sky”

‘Eye in the Sky’ is the latest Hollywood film dealing with the wars of the American Empire. This one however, is a bit different. Other than the usual military glorification that we have seen in films like “American Sniper” or “Zero Dark Thirty”, the film actually does challenge the audience to deal with the real underlying moral problems of modern warfare.

The way the so called west fights wars these days is highly problematic. In the past, war meant that you had to send soldiers to the battlefield, where they were in real danger to die or at least get seriously injured. The advance of weapon technology has changed this more and more. The further advanced the technology became, the further away from his target the soldiers had to be. We are now at the point where, via computers and satellites, a weapon can be fired remotely from everywhere on the planet. As a consequence, bravery is no longer a real requirement to be part of the military. You can be a complete coward and still become an excellent soldier. A soldier can engage in very destructive fighting operations without any personal risk to himself. Working as a construction worker is probably a lot more dangerous than engaging in a lot of battles these days.

The lower body count is not necessarily something to celebrate. It has made war much more acceptable for the general public, to the degree that a lot of people are not even really aware that countries like the US have been at almost constant war, at least since WWII. We got a good indication of how unaware people are of this fact after the attacks on the World Trade Centre in New York on September 11th 2001. Most people were clearly confused that someone had attacked the US. Why did they do this? Here was this peace loving land of the free, suddenly under attack by some wild savages for no other reason than completely irrational hatred of the western lifestyle.

Of course I agree that these attacks were horrible and completely unjustifiable, but they did not happen in a vacuum. They happened in the context of a war that the US and her allies were fighting for a long time and that they arguably started. Yes, absolutely, 9/11 was an unjustifiable massacre of innocent people. But so is a lot of what western militaries do. Because the other side of this modern weapons technology is that in order to save the lives of western soldiers, more people have to die on the other side of the battle field. And that means, mostly, more innocent people.

This is one of the moral problems that ‘Eye In The Sky’ deals with. If you haven’t seen it, spoiler aler!  I might mention some detail of what is happening in the film. Although it does not matter too much, as even if you know the plot, it is still an excellent film to watch. I can very much recommend it.

The film deals with a few problems, but the main and most important moral problem that is addressed is this: The military of the US and the UK in a joint mission have spotted a few wanted members of the Al Shabaab terror group in a house in Nairobi, Kenya. Via an electronic beetle they fly a small camera into the house. Watching what is going on, they realise that there are two people in there who are preparing for an imminent suicide mission. However, they could stop the suicide bombers by blowing up the house via a drone in the Sky (hence the name ‘Eye in the Sky’). The problem is that the house is bordering on a square with a number of people. Most importantly there is a young girl selling bread right next to the house. Bombing the house would very likely kill the girl, especially since the explosion would be amplified by the explosives in the house. So the question is, is it morally OK to kill the girl (and some other people), if that prevents the likely deaths of even more people from the suicide bombers.

Probably quite realistically, the people in charge of the US military are portrayed as being a bit confused by the notion that this situation poses a moral problem that needs answering. Probably a bit less realistic is that the English side is very concerned about this moral problem. This is arguably the weak point of this film, but it is needed otherwise the problem would not be discussed, which is what the film, to its great credit, really wants to do.

In other words, the main problem of the film is the acceptability of what today is euphemistically called ‘collateral damage’. Is it OK to kill innocent people, even children, to achieve some higher goal? The film ultimately does not answer this question. But it does show a good summary of the arguments for the yes and no camp.

From a libertarian’s point of view, the answer is of course clear. It is of course not OK to kill innocent people for a greater goal. Which greater goal would that be? There is no greater goal than the life and liberty of the individual human beings. However, the question is asked in a more clever way that might get some people to become confused about what the right thing to do would be. The problem is that the greater goal in this situation is to save the lives of even more other people. So the question that is asked is, can you kill one innocent person in order to save more other innocent people.

But the answer to that question also needs to be no as well. Lives do not add up in some magical life pool. Every individual person counts on their own. And every person is only responsible for their own actions. In other words, it not only matters who gets killed, but also who kills. Is it me who does the killing or someone else. I can only be responsible for my own actions, not that of others. This is particularly true if it comes to deciding who gets killed. Yes, in the situation portrayed in the film, the terrorists would likely go on and kill some people. But they would not have killed that girl. So the person who bombs the house and kills the girl essentially takes on the role of a judge over who gets to die and who to live. Where does the authority come from to make such a decision? A person, who thinks he has that authority cannot claim he was not responsible for what happened. He becomes a murderer.

People who argue otherwise, need to make the argument, that lives do indeed add up. They would need to make the argument, that human lives are exchangeable. It does not matter who dies, all that matters is the body count. In this mindset, humans are just numbers and not individuals. However, this is exactly the mindset of every totalitarian greater good regime. That means we are going down the rabbit whole of totalitarianism.

But I do not believe that most people really do believe this. The test for it is simple. What if the girl is not just anonymous, but your own daughter or at least someone you know? Or what if it is your own life that is at stake? I bet it becomes immediately difficult to just see these people as the a number 1 in a bigger equation.

If that is true, then what is really behind the argument is just primitive tribalism. It is only the lives of my own kind that matter. Strangers however, are numbers that can be add up in simple equations. That really is the moral standard of people arguing in favour of murdering innocent people for a greater good. And we really have to overcome this standard if we want to live in a better, freer world.

Options for Port Talbot

Tata Steel (part of Tata Group– an Indian multinational conglomerate) has decided to sell its entire business in the UK, threatening thousands of British jobs. The reason why we’re here is because we just cannot compete with China, causing Tata Steel to lose £1 million a day. According to a recent article by the BBC, there are- broadly speaking- five options. I want to discuss each option from a libertarian perspective.

Option 1: Sale

It’s not easy to find a buyer for a business which loses £1 million a day. And those who are negotiating are not offering enough money. From a libertarian perspective, this is the rational market response and it’s signalling something very important; i.e. the UK must not force itself in market where it isn’t efficient but rather focus its energy on where its strengths actually lie.

Option 2: Nationalisation

Supporters of this idea almost always talk about that nationalisation of banks during the recession as if that was brilliant idea; it really wasn’t! Basic economics teaches us about specialization and comparative advantage. Why we would want to keep alive an industry which is losing us money when we can reallocate our resources elsewhere which is more profitable is beyond me. But then again, British politics is more about what sounds good, feels good and receives claps at Question Time rather than what is rational and productive.

Option 3: Temporary Nationalisation

If Tata Steel faces immediate closure, supporters of this option argue that we should temporarily nationalise it until we find a buyer. It’s as nonsensical and irrational as the second option. If the industry cannot survive the market competition then keeping alive via taxpayer money is only going to help the steel industry at the cost of everyone else in the economy. Imagine if everyone who was about to go bust due to their inefficiency compared to China claimed taxpayers’ money. As ridiculous as it sounds, it’s completely plausible according to the above logic. If the banks, why not the steel, and if the steel why not….do you see the slippery slope?

Option 4: Government Support

As if the deficit in not large enough and we’re not in debt enough as it is, this option suggests that the government should help out by loans or loan guarantees. This will disrupt market signals, keep an inefficient market alive and, hence, cause market inefficiencies.

 

A side point before we move on: options 2, 3 and 4 require permission from the EU. If you’re going to be an interventionist at least don’t give up your sovereignty. Why do we need permission from a body which does not represent us and why should they have a say on how we run our country?

 

Option 5: Closure

According to the BBC, “This is the option no one wants, and which everyone fears”. From a libertarian perspective, there is nothing to fear and it isn’t a matter of want. The market chooses efficient outcomes (more so than any other institution). If Tata closes then the money and labour invested in steel would have to reallocate to more efficient markets. In the short term, yes, we will see some unemployment but in the long run we’ll know to invest our resources where we can actually compete. The option to artificially keep the industry alive is pointless and even more costly. What we need is a self-sufficient market, not one which depends on taxpayer money.

Christopher Snowdon [@cjsnowdon] Releases the First EU Nanny State Index

Christopher Snowdon of the IEA has released the first EU Nanny State Index and it makes depressing reading for those of us in the UK. According to the analysis, that assesses the tax and regulation of ‘sins’ such as smoking and drinking, the UK is rated 3rd worst — far, far behind places like Germany!!

This is important work by Chris so go check it out and share it far and wide…

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