From: abell@netcom.com (Steven T. Abell)
Subject: Re: Evidence for the market
Organization: Netcom Online Communications Services (408-241-9760 login: guest)
Date: Tue, 26 Jan 1993 18:54:39 GMT

sulkom@ubvmsb.cc.buffalo.edu (Mark Sulkowski) writes:
>abell@netcom.com (Steven T. Abell) writes:
>>svanegmo@cantor.math.uwaterloo.ca (Stephen Van Egmond) writes:

>>>Actually, it has been shown, and is accepted (at least by my ECON 101 text,
>>>which on the whole is a balanced assessment of free-market behaviour), that
>>>there is a type of good called a "public good" which, if left to the market,
>>>would not be provided.

>>>The typical example is military defence.  I recognize that in an Objectivist
>>>world, the military would have little or no place.

>>Not true. Defense is one of the few "public goods" required from the
>>government by objectivism. It is a necessity, but is not provided by
>>a legitimate market because it is neither constructive nor based on
>>service to individuals.

>        Excuse me?  Did I understand you correctly?

>        Most people would agree with you (as do I) that defense is a "public
>good" and it is necessary in a world filled with aggressive militaries.
>But I don't understand your point that it is neither "constructive"
>or a "service".

>        Defense most certainly is a service.  Its job is to protect
>your life and property.  How is this not a service?

>        Perhaps you mean that it is not "constructive".  But what does
>that have to do with anything?  If defense serves a purpose for you,
>you would be willing to pay for it.  You would pay based upon the
>degree of protection you want from foreign aggression.

>        The reason that "public goods" are difficult to provide is
>that its benefits are difficult to internalize to paying customers.
>This leads to people free riding off of their paying neighbors.

>        Constructiveness has absolutely nothing to do with it.

Well, it's kind of subtle, and you have to read *all* of what I said.

If you'll reread my posting, you'll see I said "service to individuals",
that is, service to those who benefit directly from what they are paying for.
Medical care is a good example. The benefits of national defense are diffuse
and hard to measure in terms of individuals, even when those benefits are
large.

Constructiveness has to do with the desires of rational people. For example,
I don't go running around destroying things just because it's possible. Some
folks do, and that's OK, as long as they're paying for it and not harming
others. While there is a philosophical difference between defense and
destruction (at least, in a rational philosophy), this difference doesn't
often matter much in terms of physical outcomes.

Defense of a country against an external enemy is not something that can
be carried out by individuals until the enemy has successfully invaded.
External defense doesn't provide anything that enhances life under what we
like to think of as normal circumstances (fails constructiveness test).
And while defense can help maintain quality of life, there's no feedback
channel to maintain quality of service during peacetime because the system
isn't being tested in a way that individuals can immediately perceive (fails
service-to-individuals test). Because of these two non-features, rational
people don't build private markets in external defense.

Steve abell@netcom.com
Newsgroups: alt.philosophy.objectivism