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dysurian

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Some questions from someone new to FTL
« on: April 10, 2007, 09:18:01 PM »

I'm new to Free Talk Live, and to the liberty movement in general (thought I've been liberty-minded for a few years without really thinking of it as an encompassing philosophy). I find that I agree with a high percentage of the ideas put forth in the show, but have a few questions about libertarianism that I thought I would put out on the forums instead of bothering the show with it, since they have probably covered it on-air. I'm looking for some better points to make when I'm talking liberty to my friends and co-workers. It's in your hands.

1) With a metal-backed currency - If we switched to a metal-backed currency, am I right in assuming that mining would become the most profitable line of business? If we switched, wouldn't people mine the crap out of the available gold/silver and drive down the value of money, and crash the value of currency? I know that mining the metal would get to the point where it wasn't profitable enough, and the market would work itself out in that way, but the initial rush could be a big problem. Would this be taken care of by just slowly switching to metal-backed currency or some other way?

2) Private security - I understand that without government-controlled police and military, that private security companies could fill the void for those with protection needs. With private security, what is stopping a security company from becoming extremely large and performing hostile takeovers (like literally with guns) of other security companies, or if the largest and best strapped private security company decides to extort individuals and businesses for money. The presence of guns is what makes the current US government so dangerous and arrogant, and I fear that something similar could happen with private security, guns and power being connected as intricately as they are. What prevents the security companies from becoming just another band of armed gangsters?

3) Why won't government creep back in? - Even if a segment of society manages to open its markets, minds, and borders why wouldn't big government creep back in over time? This is, as I understand it, what happened to the relatively free United States in its first couple hundred years. This idea was brought up recently on the show, and not really addressed in a way that satisfied me. Would liberty-lovers just hope the rest of the world begins to agree over time, so that the whole world eventually finds this kind of freedom to be the only way of life, or could a geographical segment of the world somehow survive as its own little "liberty state?" If so, how?
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Ecolitan

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Re: Some questions from someone new to FTL
« Reply #1 on: April 11, 2007, 12:42:23 AM »

1) With a metal-backed currency - Seems unlikely to me that there would be only one commodity used as currency.

2) Private security - Will always be a real problem.  I'd prefer the armed thugs be divided into competing factions.

3) Why won't government creep back in? - It will.  Eternal vigilance is the price of liberty.
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sillyperson

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Re: Some questions from someone new to FTL
« Reply #2 on: April 11, 2007, 01:35:05 AM »

And do remember, Ian speaks for some of the most radical elements.
Most libertarians and pro-liberty people (that I run into, at least) are more like Mark than like Ian.
Though I would say Ian is dragging a big center of gravity in that direction...

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Re: Some questions from someone new to FTL
« Reply #3 on: April 11, 2007, 03:15:32 AM »

Even if you mined metal as fast as you possibly could, there's no way you could cause inflation at anywhere near the rate we see it worldwide with every world fiat currency now. I recall reading somewhere that the highest recorded annual rate of inflation of gold was 3%. But the purchasing power of metal is much more stable than the purchasing power of goddamned pieces of paper.

The thing that prevents private security companies from "taking over" by force is the fact that (almost) everyone's armed, and they have to convince these people to give them money. It's much easier to do it by voluntary means than by force, if the society is already free. No one would knowingly do business with a security company that used force against its own customers. They would be ostracized faster than you can say "Gun!" and more than likely go out of business entirely.

Government will almost certainly return without eternal vigilance. Our ancestors failed to remain vigilant, because they failed to remember that government is evil. And they failed to remember this, because they took the reins of power.
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dysurian

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Re: Some questions from someone new to FTL
« Reply #4 on: April 11, 2007, 11:46:15 AM »

Thanks for clearing up my confusion on currency.

And do remember, Ian speaks for some of the most radical elements.
Most libertarians and pro-liberty people (that I run into, at least) are more like Mark than like Ian.
Though I would say Ian is dragging a big center of gravity in that direction...

I'm definitely more Manwich-minded than Ian-minded too. It seems like thinkers like Ian are the beautiful idealists that any good idea needs, and folks like Mark are the rational compromisers with reality (and ultimately, in my opinion, more likely to realize their goals).

The thing that prevents private security companies from "taking over" by force is the fact that (almost) everyone's armed, and they have to convince these people to give them money. It's much easier to do it by voluntary means than by force, if the society is already free. No one would knowingly do business with a security company that used force against its own customers. They would be ostracized faster than you can say "Gun!" and more than likely go out of business entirely.

I understand the whole concept of market ostracism, and that I wouldn't want to be the customer of a company that forcibly extracts money or property from its own customers (or anyone else, for that matter), but I don't see how it would work quickly enough. In the case of a very large security company (think the "Wal-Mart of Armed Forces") what would prevent some sort of "evil" coup from occurring within the company and corrupting its intentions. Individuals would stand little chance against a force of hundreds of people invading their home. In a battle of one gun vs 100, the 100 will pretty much always win. Ostracism would possibly work in the long run (i.e. people wouldn't do business with them any more, because they are thieves) and they would be ostracized as a security company. In effect, though, this new "evil" security company would no longer have an interest in making money by providing security, but in stealing and running other businesses and owning other property.

Actually, I suppose people would ostracize even then, and not use the goods and services of a stolen company, or pay for stolen land, so maybe it would work in that way. Even so, there would be some people out for a good deal on land who wouldn't care that it was stolen, as long as they could get it cut-rate. My concern (as it always is with weapons) is that guns produce artificial power that the marketplace can't predict or control. To stop a group of madmen with guns requires either lots of ingenuity, or more guns than they have. I guess this really ties in to the idea about being eternally vigilant on this front as well as on the front of keeping government out of our affairs...
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Re: Some questions from someone new to FTL
« Reply #5 on: April 11, 2007, 12:29:53 PM »

You pretty much explained why no single security company could ever "take over" as in your hypothetical ridiculous impossible scenario. You said:

In a battle of one gun vs 100, the 100 will pretty much always win.

That's why it will never happen.
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SnowDog

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Re: Some questions from someone new to FTL
« Reply #6 on: April 11, 2007, 12:40:19 PM »


1) With a metal-backed currency - If we switched to a metal-backed currency, am I right in assuming that mining would become the most profitable line of business? If we switched, wouldn't people mine the crap out of the available gold/silver and drive down the value of money, and crash the value of currency? I know that mining the metal would get to the point where it wasn't profitable enough, and the market would work itself out in that way, but the initial rush could be a big problem. Would this be taken care of by just slowly switching to metal-backed currency or some other way?


We were on a metal backed currency from the 1700s - 1971, and mining companies were only about to increase the gold supply, by about 2% per year, which is a much lower rate than the current rate that the money supply increases through the expansion of debt.

Note, also, that there are mining companies today trying to mine precious metals, which have only gone up in price since gold was removed as backing from the US dollar, and still gold supply increases by about 2% per year.


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Re: Some questions from someone new to FTL
« Reply #7 on: April 11, 2007, 01:08:00 PM »

If you really want to see how this works out in practice, take a look at how the value of the British pound changed before and after it was taken off precious metals. (Source: House of Commons Library)

See if you can guess when it happened.

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dysurian

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Re: Some questions from someone new to FTL
« Reply #8 on: April 11, 2007, 01:19:36 PM »

You pretty much explained why no single security company could ever "take over" as in your hypothetical ridiculous impossible scenario. You said:

In a battle of one gun vs 100, the 100 will pretty much always win.

That's why it will never happen.

I'm confused about how that proves it can't happen. I think my scenario doesn't quite qualify as ridiculous, because a large armed force can become a standing army quite readily, and time and again in the world armies are used for forceful and political designs.

The market bearing itself out also depends on everybody thinking about the long-term consequences of their actions. I'm sure people would (necessicarily) be more aware of this in a free society, but the problem will always exist, and certain short-sighted people and groups will make decisions based on immediate gain, rather than long-term. This is what might cause a large armed group to act forcefully against individuals for money or property without thinking ahead about how it will cause their ostracism. Meanwhile, I'm still dead if they decide to kill me for my house.

I guess to rephrase my concern: What stops a large armed body from becoming a standing army with political designs? I get the impression that my concern about this is more and more connected with the fear that big government would use this method asa  way to creep back in to society.
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Re: Some questions from someone new to FTL
« Reply #9 on: April 11, 2007, 01:33:52 PM »

The simple fact that most people just want to go home and live their lives.

You should take a look at Somalia where some of these issues are playing out. The "failed state" is in a state of virtual anarchy, though for most people this means that their lives are better, they have better access to water, food, and even things like cell phones, which are cheap in Somalia, but virtually unheard of elsewhere in Africa. Coca-Cola moved in. To an ANARCHY.

Most all the violence being seen there now is the result of invaders such as the United Nations attempting to reestablish a government being shot by natives who would rather they didn't.
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dysurian

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Re: Some questions from someone new to FTL
« Reply #10 on: April 11, 2007, 01:55:30 PM »

That does make a whole lot of sense. Anybody voluntarily living in a free area would just want to live their life, so the very IDEA of needing a lot of security just doesn't make sense, so there wouldn't likely ever be a large security company or armed force of any kind. Thanks to all who have poseted so far for helping clear up my questions, I'm sure I'll have more as time goes on. I'm a philosophy major coming from the Rand camp, so a lot of the same ideas are there, I'm just confused about economics and free markets, thanks to my public high school education not really explaining their importance  :D
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theodorelogan

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Re: Some questions from someone new to FTL
« Reply #11 on: April 11, 2007, 01:57:29 PM »

Quote
What stops a large armed body from becoming a standing army with political designs?

The lack of money to fund such a force for an extended period of time.
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Go figure...

RAD!

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Re: Some questions from someone new to FTL
« Reply #12 on: April 11, 2007, 02:07:25 PM »

Yeah, there's that too. War is almost impossible to fund without playing economic funny business. Fiat money and modern economic theory (outside of the Austrian school) is geared toward studying this, and is pretty much useless for any purpose other than screwing people.
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theghostofbj

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Re: Some questions from someone new to FTL
« Reply #13 on: April 11, 2007, 02:26:41 PM »

If we switched, wouldn't people mine the crap out of the available gold/silver and drive down the value of money, and crash the value of currency?

Pretty much all precious metals that can be mined profitably are being mined at the moment.
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Wayne

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Re: Some questions from someone new to FTL
« Reply #14 on: April 13, 2007, 06:55:04 AM »

We were on a metal backed currency from the 1700s - 1971, and mining companies were only about to increase the gold supply, by about 2% per year, which is a much lower rate than the current rate that the money supply increases through the expansion of debt.

From what I understand, under a gold standard the amount of new gold mined tends to be close to the population growth rate of the society mining it, so 2% seems reasonable.

Plus this makes sense. The more gold mined, the less profitable it becomes, and in a free market real profit tends to be scarce anyway. So I always figured the greatest demand for new gold would be from everyone needing it to engage in new financial transactions with new members of society.

-Wayne
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