The Transaction Costs of Oppression

The time for talk had ended. This was war.

The island nation of Mungerica had reneged on her 2011 neuropolyp weapons treaty with Spivonostan as the internationally-approved inspection team had discovered in its mandatory annual sweep. Negotiations stalled. Ambassadors were recalled. Spivonostan instituted a naval picket around the main deepwater harbor of Mungerica. Shots were fired against a light destroyer on the fringes of the fleet. War was declared less than 18 hours later.

Now, over the course of the Pax Mungerica, a number of diasporas flourished on both sides of the political border. Ethnic Mungericans were seafarers by avocation, so when they settled abroad, they tended to take up residence in the coastal towns to fish, stevedore, or what-have-you. Spivonostanis were relatively skilled at agriculture, which meant soybean farming in the lowland plains of Mungerica.

But despite their cosmetic differences, both Mungerica and Spivonostan were of one mind when it came to their shared mistrust of foreigners. On the outbreak of war, each nation instituted its own version of internment. In Mungerica, the chief executive issued Order #1121, named the Foreign National Detention Act of 2015. In Spivonostan, the order had no name, and was barked to underlings in a filthy tongue scarcely fit to reproduce in print. The effect was identical: all ethnic Mungericans were to be rounded up and sent to a detention facility in the hinterlands of chilly Spivonostan until further orders were received.

The non-cosmetic difference between Mungerica and Spivonostan was that Mungerica bore an almost pathological insistence on preserving the right of the people to own firearms. Spivonostan had no such tradition. So when the Spivonostani warchiefs collected the Mungerican immigrants, they faced no real opposition. Cowed and meek, the best the defenseless Mungericans could do to mount a defense was to try to sneak across the border in the dead of the night or to hide in the woods. Not only were they dispossessed of their property, but they were stripped of their dignity. In Mungerica, the ethnic Spivonostanis were at least occasionally armed. And in some of the farming communities, they were armed and organized, so that when Mungerican soldiers arrived to load them onto flat cars and take them away, they met with violent resistance.

Now, as is the case with such things, the Mungerican forces easily emerged victorious against the minor domestic insurrection. No petty militia stands against a secure sovereign. Just ask General Tso and his delicious chicken. But even though the insolent Spivonostani rebels were suppressed, it took the time, treasure, and blood of the nation to do it.

On the margin, the right of the people to bear arms raised the opportunity cost of oppression.

Of course, the distraction may end up costing Mungerica the war. It almost certainly cost them their neuropolyp weapons program, since the rebels were able to sneak in and set ANFO charges around the main refinery. Then again, it's possible that some of the polynucleotide material was released into the environment without being incinerated in the blast. The point is, it's hard to say whether or not a political choice is objectively good or bad in the absence of a convincing counterfactual. This is true for specific policy, but it might also be true for governing institutions, or even for pedestrian constitutional jurisprudence.

But this little story is a flight of fancy anyway. There's no way a liberal democracy like the US could ever run ethnic internment programs, right?

8A in the Beaver State

Oregon bakers Aaron and Melissa Klein have been fined $135,000 under state public accommodation statutes for their refusal to bake a cake for a same sex wedding. The judgement amount is being forwarded to the state labor commissioner for adjustment.

ATSRTWT.

The eighth amendment to the Constitution of the United States of America:

Excessive bail shall not be required, nor excessive fines imposed, nor cruel and unusual punishments inflicted.

So there's that. I guess.

Those of you who follow me at Sweet Talk and who find themselves perplexed at this judgement may be interested in my forthcoming altfic episode due out in the next couple of days. Check in or subscribe to stay tuned.

Neue Slowenische Kunst vs Federal Aviation Administration

Via AB, the FAA is dipping toes into regulating extraterrestrial flight. It'll be awfully interesting to see how property rights in space develop. Will the OST (Formally, the "Treaty on Principles Governing the Activities of States in the Exploration and Use of Outer Space, including the Moon and Other Celestial Bodies") of 1967 hold up? It's an active treaty, with 89 signatories ranging from Afghanistan to Zambia. Notably missing? The Neue Slowenische Kunst, or NSK, a quasi-political art project of Slovenian musical act Laibach. Here is the national anthem:


At least in the movies, the metaphor most commonly employed for space travel is maritime. Between the archipelagos of the stars is a vast ocean of nothing. And like on the terrestrial oceans, ships in space fly flags to signal their nationality. And like on the Seven Seas, it is the law of the prairie schooner, the law of the convoy, the law of the privateer—rather than the word of the king or the diktat of the parliament that is sovereign.

With the exception of warships, seagoing vessels absolutely do not have to fly the colors of their original berth. I can build a tanker at Mare Island and register it in Uzbekistan if the mood so struck me (subject to UNCLOS, of course).

You might think of the OST as a way of softly mimicking maritime or frontier law in space. Which means that the meetings at the FAA have got to be simply fascinating right now. The US lacks hegemony in space. Elon Musk could flip the FAA the double bird, register Space X with the NSK, and blaze a glorious trail into the heavens, laughing the whole while. Imagine if a weird, tongue-in-cheek art project from the early 80s would emerge as the dominant source of political authority in early extraterrestrial settlements. Just imagine.

Any would-be space sovereign is, at this point, obliged to be as gently Lockean as can be imagined. Without any rents to offer, a constitutional contract must be mutually felicitous to be adopted. Shirking is all too easy. In such a setting, all possible would-be sovereigns are on an equal footing.

Ex post? Well, I suppose we'll see if anyone regrets their arrangements.

Shouting Fire in a Crowded Barracks

No Soldier shall, in time of peace be quartered in any house, without the consent of the Owner, nor in time of war, but in a manner to be prescribed by law.

No amendment is absolute. The Supreme Court has held that reasonable constraints on the freedom of speech are Constitutional so long as they protect a public interest. Copyright law, for example, impinges on my right to reproduce or distribute certain materials for material gain. Nor am I at perfect liberty to obtain fissile materials, land mines, or earth-scouring lasers (I may have to consult with my attorney for that last one). I have no Fourth Amendment protections if law enforcement agencies seek to confiscate my property on "suspicion" of illegal activity. If I am a foreign national (and perhaps even if I'm an American national) sought in connection to non-state aggression against American interests, I have no Fifth or Sixth protections whatsoever. Indeed, I can even have hummus pumped into my rectum to the point of prolapse, or chained to a dungeon wall until I die of exposure.

No amendment is absolute. The 7th is scarcely upheld when the grand jury is little more than a sock puppet for prosecutors. And the 8th? Ha ha ha. No. Botched execution is the most extreme and obvious example, but I urge you to pick up a copy of David Skarbek's latest to get an idea of how the emergent organizations in prisons act to socialize inmates to the society, including otherwise peaceful offenders. Turning a kid with three simple possession strikes into a lifer is a pretty good example of "cruel" even if it is sadly not "unusual." The 9th? Well, let's just regulate everything, down to how many gallons of water you can use to dispose of your feces and what sorts of light bulbs you are and are not permitted to purchase. That should take care of that one. Ditto 10th.

That pesky third though. The joke amendment. What can the ambitions of the sovereign do to abrogate that sucker? Well,

Step 1: find a clever little workaround for the Posse Comitatus Act, like, oh, say, donating surplus war materiel to police departments.

Step 2: handle the inevitable abuses that arise from letting police play dress-up as Soldiers by inciting discontent either by proxy or through direct speech.

Step 3: await sedition.

Step 4: there is no step 4.

Step 5: declare national state of emergency.

Step 6: it ain't a 3rd violation if the police/FEMA/ATF/& al do it, right? RIGHT?

Recall Hume:

May not the sovereign lay claim to [superfluous (unemployed) labor], and employ them in fleets and armies, to encrease the dominions of the state abroad, and spread its fame over distant nations? It is certain that the fewer desires and wants are found in the proprietors and labourers of land, the fewer hands do they employ; and consequently the superfluities of the land, instead of maintaining tradesmen and manufacturers, may support fleets and armies to a much greater extent, than were a great many arts are required to minister to the luxury of particular persons. Here therefore seems to be a kind of opposition between the greatness of the state and the happiness of the subject. A state is never greater than when all its superfluous hands are employed in the service of the public. The ease and convenience of private persons require, that these hands should be employed in their service. The one can never be satisfied, but at the expense of the other. As the ambition of the sovereign must entrench on the luxury of individuals; so the luxury of individuals must diminish the force, and check the ambition of the sovereign [emphasis SLW].

I'd like to think there are good, non-confrontational negotiations that might return the job of policing back to the euvoluntary provision of decent law and order. I worry that as a practical matter for very large jurisdictions, that ship might already have sailed. If you live in an area with cowboy keystone cops, I sincerely wish you the best of fortunes. Let's just hope I'm a false Cassandra and my paranoia is the product of a worried mind and nothing more.

Then again, hope in one hand, sue for libel in the other. See which one fills up first.

Toward A Theory of Euvoluntary Political Exchange

I had a fun little back-and-forth with SMBC cartoonist and BAHFest organizer Zach Weiner yesterday on Twitter. You can read it here if you're so inclined, but be forewarned: it got silly and a bit scatological pretty quickly. The non-silly modified transcript went something like this:

Z: Are any lawmakers going to do anything about the CIA torture report?
S: What would you have them do?
Z: Punish transgressors. Credibly commit to punish future transgressors.
S: Torture has been around for thousands of years. How will a little extra punishment help?
Z: WTF are you talking about? We successfully outlawed slavery. We can successfully outlaw torture.
S: Slavery still exists, all we did was force it underground.

And then Adam G joined the conversation and it quickly devolved into jokes about the political economy of seasteads (check for yourself if you don't believe me).

It struck me that Zach and I must have very different game theoretic models underpinning our views of how and why the state exists. By suggesting that punishing torturers would produce better behavior, I think Zach basically subscribes to the notion that the telos of the state is to govern, that the sovereign is generally the product of Lockean bargaining, Hobbesian entrepreneurship, or Rousseauian foresight. Zach appears to hold a wildly popular view, both inside the academy and among the general public, that people who hold political power—the power to coerce others—are endowed according to the Enlightenment-era principles described by Jefferson in the DoI:

Governments are instituted among Men, deriving their just powers from the consent of the governed

To Zach, and indeed to any American you'd poll with probably greater than 95% likelihood, this sentiment is accurate. The government is legitimate if and only if it serves the interests of the people, if perhaps not always their direct will. How widespread is belief in this model? I've heard my patron here at EE [obliquely] reference it more than once. If there's anyone in the world I most closely agree with on matters of political economy, it's Michael C. Munger.

But on this matter, I part a bit with first-principles theories of political organization. It might be that the sovereign arises to solve some thorny collective action problem, but that doesn't say very much about what it does once it sticks around. In this sense, I find myself much more closely aligned with Hume, that the continued existence of the sovereign is to encrease his own opulence and dominion. If good public law and order happens to arrive along with this pursuit, all the better, all the more euvoluntary if you will. However, a lifetime of casually following politics, of noting the periodic lapses in ethical behavior of the political elites, of surveying historical episodes of malfeasance, of noting the curiously acceptable practices in politics that are outright illegal in the private sector (insider trading is the most benign example that springs to mind), I find it nearly impossible to conclude that the state exists to serve anyone other than itself.

If the popular model is correct, if Zach is correct, the CIA (and whatever other organizations who've not had extensively-redacted reports publicized) is acting aberrantly when its agents force food and water into the rectums of prisoners with sufficient vigor to result in hemorrhoids, anal fissures, and rectal prolapse. Punishing those who are not acting in concert with the fundamental principles of the organization is sufficient to ensure compliance. Contrarily, if my model is correct, if Hume was right, and the state exists to encrease the dominion of the sovereign, there was no wrongdoing. At least not in the hidden, hermeneutical mission statement of the agency. If I'm right, the only person committing heresy is the whistleblower. If I'm right, Snowden is a criminal, not Rogers. If I'm right, whistleblower statutes need to (a) exist and (b) have no real capacity to protect whistleblowers. If I'm right, prosecutions would be Soviet-style show courts. If I'm right, the only way to ensure that torture is ended is to abolish the CIA entirely, along with the numerous other unaccountable federal agencies that enjoy wide discretion and little Congressional oversight.

However, I am not the hegemon of Plato's Cave. I do not have the luxury of indoctrinating the young while calling it "social studies." I cannot convince you that my model is correct and the popular model is as fanciful as a chocolate unicorn riding a pumpernickel skateboard across a peppermint half-pipe. All I can do is gently encourage you to revisit from time to time the basic model you have for political authority and to ask if the patterns you see in political activity reflect your hypothesis or if they might be better explained by an alternative.

We all want a more euvoluntary relationship with those vested with political authority. To get there, it might be worth reconsidering the terms of the implicit contract. T/F, explain.

A well regulated militia being necessary to the security of a free state

, the right of the people to keep and bear arms shall not be infringed.

In the tumult of 18th century politics, the men who ratified these sentiments understood that disarmed citizens were more easily cowed by an ambitious sovereign. They held that the weed of tyranny quicker chokes the garden of liberty when the gardeners have been stripped of the, uh... trowels of, uh... revolution, I guess.

Failed metaphors aside, the economics are straightforward. Armed citizens are marginally better able to kill than unarmed citizens.

I of course use "kill" here in a neutral sense. A hunk of fabricated metal has no sense of justice. A pistol in the hands of a street thug will perform the same function as a pistol in the hands of a taxpaying homeowner. A service revolver in the hands of a rightfully appointed deputy of the law will take a life as surely as a service revolver in the hands of a corrupt cop. A rifle in the hands of a dutiful Soldier defending the homeland against foreign aggressors kills the enemy as surely as a rifle in the hands of his counterpart on the other side of the firing line.

But as gun control proponents rightly point out, the right of the people to keep and bear arms is far from uncircumscribed. Why is it that the logic of prohibition does not apply to polonium or cyanide or white phosphorous or Claymore mines or Anthrax or uranium-235 or mustard gas? I reckon there's a bit of a black market in these things, but atropa belladonna is more likely to show up as part of a show garden than as the lethal poison that earned it the nickname of deadly nightshade. What's the difference? Why do drug cartels arm themselves with AK-47s rather than sarin gas? Why isn't there a more robust underground economy in the relatively easy-to-produce phosgene? If you're looking to kill, a corpse is a corpse regardless of whether it's riddled with bullets, dissolved in acid, or suffocated in gas. The economical approach is to maximize benefits while minimizing costs, yes? Law-abiding citizens have sensibly prohibited the use of indiscriminate weapons of death, and of poisons. Surprisingly, criminals have largely agreed. The ban on chemical, biological, and nuclear weapons is mostly effective! Why?

Some of it is probably because of ordinary persuasion. It's cowardly to poison someone; it always has been. Yet it isn't cowardly to shoot someone, even (evidently) from thousands of miles away in a metal box stuffed with electronics. Guns are honorable—more honorable than poison, anyway. Poison is dishonorable. Gun rights folks are keen enough to recognize that the logic of prohibition would apply to firearms: the bumper sticker version runs "if guns are outlawed, only outlaws will have guns," so imagine how great it would be if those same folks understood that the same precise line of thinking applies to narcotics.

In the case of banned agents of death, what the legislation has done is to encode the law. There's pretty much wide agreement that combat toxic agents have no legitimate place in a civilized world. There is substantial and meaningful disagreement about a similar role for recreational drugs and firearms. The disruption to the orderliness of civil society and the increased state-led oppression that accompanies the ban on the drug trade means that the voluntary exchange of narcotics would be more euvoluntary but for the statutes prohibiting their trade.

How is heroin not like aconitine? The power of rhetoric. Bans carry unintended consequences. Persuasion works exactly as it says on the tin.

The Enigma of Ford

Rob Ford, the "disgraced" mayor of Toronto, still enjoys an order of magnitude more public approval than the US Congress (I know, I know, apples to oranges). This despite rock-solid evidence that he's smoked crack while in office.

There was, in Tudor England, a habit of old that on the Twelfth Night (as popularized by Shakespeare's eponymous play) of Christmas, the night before Epiphany, peasants and nobility would swap roles, the former dining on... well, I'll let Dan D'Amico explain:


If you get the baby (or the bean, or whatever local variant you like), you get to pretend to be a lord until sunup. @danarchism's right on the money; cultural, social... human capital is the name of the game. This festive celebration obliged feudal constituents to adopt some variant on the very sort of sympathy championed by Adam Smith in his Theory of Moral Sentiments. If only for a day, the (un?)lucky peasant would have to don the pantaloons of the lord of the manor and hear the petitions of the governed. It was a great, rollicking joke with a great rollicking punchline and a great rollicking serious message embedded within. Using my Pete Leeson spectacles, Twelfth Night was an institution that, as cheaply as contemporary political technology allowed, permitted greater social stability.

And then there's this guy:



The gentleman behind the wheel is Deadmau5. He is a musical whiz, a Giorgio Moroder for the opening act of the 21st century. And he puts up a 30 minute video of him tooling around with his crack-smoking mayor.

Rob Ford governs as if every night were Twelfth Night. AND THE WORLD IS A BETTER PLACE FOR IT.

Politics minus governance equals politainment (plus ζ, some residual). Three cheers for the City of Toronto to have the courage to admit that politainment is valuable. The grimmest moments in human history were characterized by politics taken too seriously.

I'm none too fond of transactional theories of the state. The analytical fiction of the social contract suffers from Arrovian impossibility problems, and no written constitution can ever hope to bind an active sovereign ruling a clamorous constituency. Despite my reserves, I do still believe that voters basically get what they ask for, within a standard deviation or so. And in Toronto, they've asked for some non-standard deviance. And it seems they've gotten exactly what they want.

Long live the king.

In EE terms, this tests Toronto's Ford on the Shughart/Thomas scale, and I think it finds in favor of euvoluntary institutions. If anything coercion flows in the opposite direction. Conventional morality, conventional politics would have this guy (or Marion Barry before him) out on his ear. Yet buoyed by popular support, he thrives in office. Huzzah!

Cupcakes [hoax]

It's tough to tell what is and isn't dedicated satire sometimes. I'm strongly inclined to think that the person responsible for the @CupcakeCrewNYC Twitter account is having a big ol' laugh at their followers' expense, but I'm not exactly sure what the joke is supposed to be.

For those of you with the good sense not to click through, this is the account listed on the website of an itinerant cupcake business. Nothing on the predictably bland website will prepare you for the, let's call it charged political commentary and colorful language you'll encounter on the Twitter account. It's, well, it's incongruous.

Some might even classify it as hate speech.

Here's the puzzle: would you still be morally justified in buying their cupcakes? Does shopping there implicitly endorse their political beliefs? Does boycotting them send a signal that their political beliefs are wrong?

Prices are information, but they're sort of a dumb signal. If someone doesn't buy from me, it just (credibly) tells me that the alternative uses of their cash are more attractive. To explain why, we need to rely on (non-credible) speech. Hence the importance of preserving First Amendment protections. Without the ability to doubly signal displeasure, making clear how and why this particular cupcake vendor is wrong.

Still though, the market rewards people who are good at delivering value to customers. Are political beliefs separable from business practices? Should they be? Why or why not? Can it ever be euvoluntary to truck, barter, or exchange with hateful people? Explain.

Update: further investigations suggest that the Twitter account has been compromised and that the cupcake truck is out of business. The point about commerce and morality is still salient however. Are vendors' political beliefs relevant to shoppers?

Let's Nationalize Salon

I occasionally worry my contributions here at EE are excessively preening or self-congratulatory. Regular readers will recognize an element of smug satisfaction when I write of the analytic superiority of Smithian sympathy, when I go out of my way to take others' arguments at face value, to assume sincerity.

I assure you that this is not part of a tiny campaign to demonstrate my moral superiority. I find this habit useful for the singular reason that I absolutely, resolutely refuse to believe that the large bulk of humanity, and more specifically, the loud intellectual elite that rouse their rabble, are in the regular habit of uttering craven lies all the live-long day. It flies in the face of even a moment's reflection to conclude that ordinary citizens bear vituperative intent in their notions of what's best for civil society.

With this in mind, I beg of you to refrain from assuming of me too much conceit when I attempt to lend Fred Jerome the benefit of the doubt when he forwards a proposal to nationalize the media.

Imagine a world without the New York Times, Fox News, CNN, the Wall Street Journal, and countless other tools used by the 1 percent to rule and fool.

Easier done than said. State media is an actual thing that actually exists. The USSR, Mao's China, and the Cuban press are but a few examples. Naturally, I assume that when Mr. Jerome invokes the "1 percent" he means the top observations of the GINI curve for wealth and not for political authority. Otherwise, statements like this strain credulity:

In a socialist society run by and for the working people it represents, the mega-monopolies like Walmart, Halliburton, Exxon-Mobil, and the corporations that run the tightly controlled "mainstream media” will be a thing of the past.

 Replaced instead by a vision of the "democratic media", where presumably all voices can be heard on an equal footing. That's pretty good for me. Salon.com has 8,000 subscribers on Feedly (I still miss my Google Reader), but we've got 72. I'd be thrilled to have Mr. Jerome's readers sent my way. But that's obviously not what he means. Instead:

But what will the media be like in a socialist USA? There is no blueprint, but in a society that has erased corporate control, the articles in newspapers and magazines and online will not be filler between ads for teeth whiteners and weight-loss pills. There won’t be TV commercials for Coke, cars, or million-dollar condos. There will be no private corporations to create and sponsor the news.

Agents of the state will have the authority to silence "private corporations" who "create and sponsor the news." I assume that in Mr. Jerome's imagination, this censorious authority will munificently refrain from exploiting their privileged position for their own ends. Instead, we shall enjoy a flowering of multiple voices sponsored by the various "labor unions, tenants’ organizations, or citywide parent-teacher associations" of our fair nation. Evidently, these voices are now silenced, my own humble counterexample here at EE notwithstanding.

But here's the moral intuition, right here. Old school socialism:

To be sure, there will be no shortage of economic news in a socialist society. Some news will still come from local and national governments that set product-distribution quotas or help to negotiate them, sponsor trade and international exchange with other countries, and—if the world is still partly controlled by capitalist powers—organize defense against economic (as well as cultural, and possibly military) assaults. But most news reports in socialist media will come from working people themselves.

It's not clear to me that this author has spent much time talking to "working people themselves," because if a factory worker is especially good at filtering, sorting, editing, and creating compelling content, she may well be in the wrong line of work. Let's not focus on that though. Let's even ignore the murderous undertones of organizing defense against military assault.

Actually, let's not ignore that. I think that's actually where the moral intuition is. According to Mr. Jerome's model of private production, concentrated wealth is de facto coercive. And furthermore, it's coercive in a way that the ability to strip individuals of their possessions, deprive them of their liberty, and ultimately execute capital (pun not intended) punishment is not. In Mr. Jerome's political economy, BATNA disparity is a worse offense than the insoluble problem of production in a socialist economy.

I do vanity searches for "euvoluntary" pretty regularly, and the term shows up from time to time. Once in a while I'll come across a sentiment along the lines of "if it ain't euvoluntary, it ain't voluntary." This is fascinating on many levels, not the least of which is that communist-leaning folks read Munger (and hey, maybe me too, who knows?). If you ask me, the Jerome model is consistent with this sentiment. Because of the editorial process, journalism is not especially euvoluntary.

It takes a special kind of reasoning to move from that mundane observation to "therefore our duly elected representatives owe the constituency the duty to muzzle the paper hounds of the popular press." I too take great issue with the venom spewed by large news organizations. My solution is to share my thoughts with you here rather than silencing the analytically vapid dirty laundresses on cable news channels. I endeavor to practice euvoluntary exchange to the best of my limited ability. I seek neither dominion nor violence. By my estimate, the finest answer to the hogwash on TV and in print is to offer better content. If I'm a good enough writer, the readers will come. If I fail the market test, so long as no one is forcing your eyeballs elsewhere, it's infantile to assign the blame to organizations who are better than I at attracting attention. Shutting them down by force is institutionalized envy. I have little enough interest in encoding virtue into the function of the state. I have no interest whatsoever in wedding the coercive authority in society with one of the more base vices.

h/t to FiSH for the link




Happy birthday, Lysander Spooner! When the dead rise from their graves, yours'll be the last corpse I torch with my homemade flamethrower!

A Game of Institutions Book 3: The Sanctioners' Dilemma

Recall from last chapter the proposition I encouraged you to consider: though the reasoning may be fallacious or rooted in vice, people may be motivated by payoff asymmetries and previously-accumulated earnings. Let's consult our simplified table of game archetypes to see where we might look next.

	Cooperative	Non-Cooperative
Symmetrical	Coordination (Euvoluntary)	PD (Coercive-Voluntary)
Asymmetrical	BoS (Voluntary)	Hawk-Dove (Coercive)

In S&T, recall that euvoluntary constitutions require no ex post enforcement to maintain cohesion. I used the example of low-exit-cost partnerships to illustrate these. I think that some of the Ostroms' examples would qualify too. But once we start shuffling around the box above, we move away from the euvoluntary conditions toward... something else. I do hope you're willing to forgive me for staying in the "symmetrical" row rather than the "cooperative" column, but since I just got done posting about the Amish, I trust you'll be willing to bear with me.

Exclaves fascinate me. Pseudo-enclaves even more so. In the case of the Amish, we've got an extra layer of governance embedded (loosely) in the ordinary federal structure. But here's the fascinating bit. Unlike a Olsonian stationary bandit, the Amish lil' leviathan generates inalienable quasi-rents. After all, there's really no technology that allows a taxing authority to expropriate the warm sense of belonging to a community or the fellowship of hearth and kin. 

But, ha ha, there's quite obviously a private incentive to shirk. Amish individuals can obtain higher private utility by flaunting the rules of their society. Of course, since the SPNE of this is for everybody to shirk, it is in the constitutional interest to have an enforcement mechanism. And what could be better than yanking the club card? Credibly threaten to revoke the quasi-rents of family and community, and hey-yo, the decision calculus changes. Elementary economics.

Now, I'm not 100% sure that this sits squarely in the corner of the PD box, but at least in terms of expected utility, it's my understanding that Amish communities are marginally more egalitarian than, say, old world Europe. I'm sure that some families are more influential or wealthier than others, but the Amish Church itself lacks the hierarchy that characterizes the Catholic or Orthodox Churches. The local bishop is the community leader, but it's an unpaid, elected post. I'm not enough of an expert to know whether or not hereditary elites are common, but at least nominally, the Amish value the virtues of thrift, temperance, piety, prudence, and industry. Good work makes good people. An expression of Nicomachean ethics. Again, from an outsider's perspective, it seems as if envy within the community isn't as big a component of private motivation as it is among the English.

So yes. Shunning is coercive. But it has to be in a game that generates inalienable quasi-rents. No other punishment option is either appropriate or in the choice set. Besides, if it was rough enough for Socrates to guzzle hemlock, it's severe enough to keep wayward flock members in line.

A parting note: I had originally planned to calculate and share with you the comparative statics for all these games, but soon I discovered that LaTeX editors are both a pain in the rump to use and don't display for butt in my reader, so if you were looking forward to more "math", I'm afraid I'll have to disappoint you. Sorry.

Edit: As AG notes, bishops are (can be?) selected by lot (sources I've found in a quick Google search vary, so maybe it varies by community) and more importantly, the decision to shun cannot be made lightly. There's a risk of schism, and even if there weren't, there are increasing quality-adjusted returns to network size. If the strength of your organization depends on good members, you'd want to be dang sure that truncations are well and truly in the group interest. Over-pruning a tree is as fatal as drought.

A Sociotropical Vacation

Picture this if you will. A brisk October morning, sun glimmering above the horizon as our bleary-eyed protagonist putters patiently at a red light on the way to work. Off his starboard bow, a fellow workaday commuter methodically devours a fast food breakfast sandwich five feet in front of a rear window whose glass has vacated its appointed watchstation. In its place sits a shabbily duct-taped section of opaque garbage can liner. And what to my wondering eyes did appear but a pair of bumper stickers that read "save second base" and "save the ta-tas".

To recap, on my way to work I saw someone driving an unsafe car in an unsafe manner advocating for breast cancer research. The part of me that I call "economist" puzzled at these misplaced margins. Surely if the goal here was to minimize harm, step one would be to put the Egg McMuffin away till the car is safely parked and step two is to then promptly schedule an appointment with an auto glass repair shop.

But Sam, aren't the bumper stickers are a sunk cost at this point? Aren't the relevant marginal decisions about a) the utility of eating now rather than later vs. Pr(accident)*MC(accident) and b) MB(seeing clearly out of the back) vs. MC(fixing the window)? How are some yellowed bumper stickers relevant? Isn't general equilibrium a theory of price equalization rather than a guide for individual behavior?

Yes Barnabas, those are good points. Judged solely by prudence, it's utterly insane to champion marginal contributions to a cause that's probably over-represented anyway while at the same time driving like a fool. But talk is cheap, Barnabas, bumper sticker talk cheaper still. A bumper sticker is a tweet someone else wrote in a feed you didn't choose.

And that's exactly the problem. Specifically, that's exactly the problem with direct majority-rule democracy. The rules that govern individual rational behavior when deciding whether or not to text while driving bind even less while voting. People who put off replacing shattered rear car windows are somehow competent to determine public policy wisely? Please.

But you already knew this Barnabas. You've studied Buchanan and Tullock. What I want you to do is think about this tableau in the shoes of the earthbound spectator. Randomly select an ordinary passerby and ask her if she'd think that driver a hypocrite. I'd give you 10:1 odds that the answer would be a solid, ringing "nope". I don't believe that folks are at all interested in equivocating self-interest and public-interest. In fact, I think most folks would be offended if you tried to compare the two. Think again of Adam Smith's Chinese Earthquake parable. Public policy is ever a matter of the plight of the distant affected, be they earthquake-ravaged Chinese or cancer-ravaged breasts. Breakfast is a matter of right here, right now.

So Barnabas, when you and Gary hear guys like me and Mungo bellyaching about erosions of federalism, about the metastasis of state authority, it's less a matter of the watchdog coming inside of its own volition to watch TV and eat your Doritos, it's more a problem that your indolent teenage son threw the kitchen door open and invited him inside. Constitutional constraints are non-binding unless the median voter insists on them.

Distracted driving isn't euvoluntary. Distracted voting even less so.

Meta-EE and the Constitution Part 19: Twenty-Third Amendment

Section 1. The District constituting the seat of Government of the United States shall appoint in such manner as the Congress may direct: A number of electors of President and Vice President equal to the whole number of Senators and Representatives in Congress to which the District would be entitled if it were a State, but in no event more than the least populous State; they shall be in addition to those appointed by the States, but they shall be considered, for the purposes of the election of President and Vice President, to be electors appointed by a State; and they shall meet in the District and perform such duties as provided by the twelfth article of amendment.

Section 2. The Congress shall have power to enforce this article by appropriate legislation.

When I first moved to the DC area, I was struck with a giggling fit when I saw the license plate tagline: "Taxation without Representation". I still find it risible, but the gobsmack has since grown a fuzzy patina.

Here's sort of what I think: exit and voice are complements. The ability to complain about policy is as useless as <bosoms> on a warthog without the ability to signal the salience of your disapproval by hiking up your trouser legs and finding new digs. For the contiguous US as a whole, this is pretty dang tough to do all else equal which I think is one reason libertarians of a certain stripe tend to favor so-called "states rights".

But for the DC Metro area? Constituent please.

Does the 23rd make us more euvoluntary, all else equal? Not nearly as much as the ability to move to Maryland.

Of course, the cynical analyst might conclude that efforts by district residents to gain House seats (and Senate too, if I recall correctly) in a bid to mix more blue into the Capitol. But that's just cynical, people.

Meta-EE and the Constitution Part 18: Twenty-Second Amendment

Term limits.

Section 1. No person shall be elected to the office of the President more than twice, and no person who has held the office of President, or acted as President, for more than two years of a term to which some other person was elected President shall be elected to the office of the President more than once. But this article shall not apply to any person holding the office of President when this article was proposed by the Congress, and shall not prevent any person who may be holding the office of President, or acting as President, during the term within which this article becomes operative from holding the office of President or acting as President during the remainder of such term.

Section 2. This article shall be inoperative unless it shall have been ratified as an amendment to the Constitution by the legislatures of three-fourths of the several States within seven years from the date of its submission to the States by the Congress.

At about 3:45 in the above video, there's a paean to the adequate, forgettable, occasionally regrettable caretaker presidents of the USA.

I won't bother listing the usurpations the unforgettable presidents have wrought for considerations of space, but recall the apocryphal Chinese curse: may you live in interesting times. Lemma to the Curse (A): may you be subject to an interesting chief executive. The 22nd is at least a nod at cooling the ambition of an over-interesting Commander-in-Chief.

Look ye upon the price controls and rationing of the 30s and 40s for a hint whether a zealous presidency curtails the scope of euvoluntary exchange, and you should have an idea about whether this amendment helps steer the course of things towards a sturdier raft of EE.

Ceteris paribus, naturally.

Meta-EE and the Constitution Part 17: Twenty-First Amendment

Have you ever bent a piece of metal and then bent it back to its original position? Did you notice that the second operation was easier than the first? That's because the act of bending the material weakened it. 

The Constitution is a document, a collection of ideas. The only structural integrity it boasts exists in the minds of its constituents. Fatigue enters not by broken valence bonds, but by inattentiveness to purpose. 

As we've noted so far in this series, the elements of the Constitution suggest constraints on the US sovereign authority. If you agree with the positive claim that the state is the entity in society that [quasi]-legitimately employs violence and share my normative opinion that dominion is best in very small if not entirely absent doses, you might also agree that the Constitution is to be cautionary, not aspirational. The struggle between virtue and vice is waged in the breast, not in Parliamentary chambers and certainly not in a text meant to circumscribe the bounds of state authority.

So does the following broaden the scope of voluntary trades that folks can make?

Section 1. The eighteenth article of amendment to the Constitution of the United States is hereby repealed.

Section 2. The transportation or importation into any State, Territory, or possession of the United States for delivery or use therein of intoxicating liquors, in violation of the laws thereof, is hereby prohibited.

Section 3. This article shall be inoperative unless it shall have been ratified as an amendment to the Constitution by conventions in the several States, as provided in the Constitution, within seven years from the date of the submission hereof to the States by the Congress.

In a direct sense, yes. It undoes damage wrought under the aegis of the 18th. Or at least aims to undo some of that damage. But there's some damage that can't be undone. You can unbend that hinge pin, but it'll never be as strong as it was before the insult to its integrity. Likewise, the political economy lesson taken away from Prohibition was muddled, unclear. It doesn't seem generalizable, since we've still got "narcotics" prohibition (the word "narcotic" itself is a bit of linguistic subterfuge). Nor, it seems, have we learned that the Supreme Law of the Land is meant to yoke government, not citizens. Instead, I think what we've got is a particularly virulent strain of regime uncertainty left over.

All the progressive-era amendments were a severe departure from the notion of a limited central government. When those limits are tossed out, regardless of the reasons, the rule of men crowds out the rule of law. Faulty though the rule of law might be on occasion, it is staid, predictable, impartial. Rule by men, in contrast, is fickle, whimsical, partisan. In Kahneman's terms (my interpretation, anyway), it is the cool, rational driver that tends the rule of law and the intemperate, irrational elephant that decides the rule of men. If there are euvoluntary exchanges that have to be planned over years or decades, the decline of a consistent, predictable rule of law serves to erode the probability that the venture will be successful. Regime uncertainty withers entrepreneurial talent, which impoverishes and immiserates generations. There are much better ways to correct errors in the corpus of law than to unmoor its stays.

So, 21st meta-EE or no? Visibly yes, but it's tough to have read Bastiat, Buchanan, and Higgs and yet still take a long view that thinks so.

Meta-EE and the Constitution Part 16: Twentieth Amendment

Rules of order are partially a function of the importance of management. The 20th Amendment is an acknowledgement of the rising influence of the Federal government.

Before 1933, there was a notable interregnum in the US. The lame duck session was longer, travel was slower, and Diebold had yet to invent their fancy countin' machine. Recall that as of '33, the galaxy of DC agencies had a lot fewer stars. There was War, Post Office, Commerce and Labor, State, Treasury, Justice, Agriculture, Interior, Commerce, and Labor. Most of the items found on this list did not exist.

With heavier centralized government, flaccid periods work against the interests of rentiers. The decadeuce at least partway throttles that gimp poultry, gamely preserving Capitol Hill elites' grasp on affairs, domestic and foreign.

Section 1. The terms of the President and Vice President shall end at noon on the 20th day of January, and the terms of Senators and Representatives at noon on the 3d [sic] day of January, of the years in which such terms would have ended if this article had not been ratified; and the terms of their successors shall then begin. 

Section 2. The Congress shall assemble at least once in every year, and such meeting shall begin at noon on the 3d [sic] day of January, unless they shall by law appoint a different day. 

Section 3. If, at the time fixed for the beginning of the term of the President, the President elect shall have died, the Vice President elect shall become President. If a President shall not have been chosen before the time fixed for the beginning of his term, or if the President elect shall have failed to qualify, then the Vice President elect shall act as President until a President shall have qualified; and the Congress may by law provide for the case wherein neither a President elect nor a Vice President elect shall have qualified, declaring who shall then act as President, or the manner in which one who is to act shall be selected, and such person shall act accordingly until a President or Vice President shall have qualified. 

Section 4. The Congress may by law provide for the case of the death of any of the persons from whom the House of Representatives may choose a President whenever the right of choice shall have devolved upon them, and for the case of the death of any of the persons from whom the Senate may choose a Vice President whenever the right of choice shall have devolved upon them. 

Section 5. Sections 1 and 2 shall take effect on the 15th day of October following the ratification of this article. 

Section 6. This article shall be inoperative unless it shall have been ratified as an amendment to the Constitution by the legislatures of three-fourths of the several States within seven years from the date of its submission.

The question then... what effect this language on commerce? There's not that much that's procedural in the Public Choice sense that 'tis the agenda setter upon whom rests the burden of policy choice. Rather, these are more political meta-rules that govern succession. Viewed as a barometer, this amendment suggests a beefier political presence, which careful readers will contrast with the early amendments. The Bill of Rights was meant to constrain abuses that might be wrought by an overactive Crown et Parliament, whereas the second section herein outright requires that Congress meet at least once a year.

Can you imagine a year in which Congress doesn't meet at least once? What would that even look like? More to the point, what would market participants think it would look like?

Pipe dreams aside, pondering this amendment is akin to pondering the role of government at all. Government is coercion, for good, for ill, or for other. This amendment simply tightens down a loose deckplate: it's the rest of the ship that determines whether or not the fleet is used to support the merchant armada. The 20th is meta-euvoluntary insofar as the Legislative and Executive branches so remain.

Meta-EE and the Constitution Part 15: Nineteenth Amendment

Few Constitutional amendments highlight the contrast between deontology and consequentialism as the 19th. To understand why, I have to take you on a quick tour through some political theory. Because I'm not always intentionally cruel, I'll keep it simple. If you're interested in closer detail, I encourage you to pick up a copy of Hinich and Munger's indispensable Analytical Politics.

Prelude: the text:

The right of citizens of the United States to vote shall not be denied or abridged by the United States or by any State on account of sex.

Congress shall have power to enforce this article by appropriate legislation.

Act I: you Kant just disenfranchise people.

 Both fairness and justice demands that any citizen of sound mind and good standing should be eligible to participate in the democratic process. To the modern mind, disenfranchisement is pretty close to a mild form of slavery. Political voice, at least in modern democratic polity, is something of a birthright. The 19th was a hard-won amendment, a ringing victory for women everywhere, not just in the United States, eroding the general legitimacy of patriarchal paternalism the world round.

Act II: franchise and dimensionality

What are the consequences of increased franchise? In a word, indeterminate. In game theory, we've got this result called (of all things) the Folk Theorem. The skinny on the Folk Theorem is that in repeated play, all bets are off and any equilibrium result can be sustained. So, with only white landowning males able to vote, you can wind up with a heavyhanded tyranny just as you can wind up with a sharply constrained market-preserving federal system. Ditto for universal franchise. What ends up important is the median voter.



How does adding women to the mix change the position of the median voter? That's a thorny empirical question. It's important, but close to impossible to know the direction of the arrow of causality leading between ideas and policies here. Could a rising tide of dignity for everyone have both pushed for the 19th and for the civil rights revolution that followed? In other words, to pick out the specific (consequential!) effect that women's suffrage had on the scope and scale of the state, you'd need to isolate the correct counterfactual. That is, to be generous, challenging.

And in light of this analytical challenge, I can't really say whether or not universal franchise is meta-euvoluntary or not. There are still piles upon piles of gender-specific legislation that deals with trades on the margins of euvoluntarity like access to birth control (and I mean for-real access, not just subsidies), sex education, abortion, prostitution, pornography, adoption, marriage, & lots of al. If it's the case that women help draft exchanges like these into the realm of the euvoluntary by way of direct participation, then there we go.

Of course, the nettle of the Folk Theorem still stings both ways: the counterfactual median voter could still cut ice in favor of greater restrictions on trade. I don't pretend to know what the alternative actually is. Beware folks who claim they do.

Is the 19th meta-EE? Indeterminate. Is it still normatively good? Unless you're some kind of misogynist, then yes, of course.

Meta-EE and the Constitution Part 14: Eighteenth Amendment

I admit to some trepidation at covering the 18th amendment.

Section 1. After one year from the ratification of this article the manufacture, sale, or transportation of intoxicating liquors within, the importation thereof into, or the exportation thereof from the United States and all territory subject to the jurisdiction thereof for beverage purposes is hereby prohibited.

Section 2. The Congress and the several States shall have concurrent power to enforce this article by appropriate legislation.

Section 3. This article shall be inoperative unless it shall have been ratified as an amendment to the Constitution by the legislatures of the several States, as provided in the Constitution, within seven years from the date of the submission hereof to the States by the Congress.

Instead of rehashing the moral arguments for and against the temperance movement or revisiting Yandle's Bootleggers and Baptists story, I'll make more of a Higgsian point here: before the advent of the Progressive Era, the legislature acknowledged that it lacked the authority to ban consumer products.

Congress needed a constitutional amendment to override consumer sovereignty.

Jeez. Talk about a ratchet effect. Look at how easily the median voter capitalized that idea. The only people who bat eyelids at the mere existence of the CPSC these days are crank libertarians, and even then it's pretty far from the first thing on their radar. That is an amazing intellectual and moral coup for political elites.

This amendment helped make it so that far fewer of the exchanges on the euvoluntary spectrum (indeed, perhaps only those that are firmly within the 100% euvoluntary circle) are given a hall pass by the Second Estate.

Now, we're still faced with a joint determination problem in the analysis. It could be that there was some underlying social forces that both legitimized government intrusion and wrote the blockquote above. Consider the possibility that the indifferent mass in the middle may have supported just this one little intrusion, without ever expecting the more generic notion to mentally metastasize. Consider how silly it would seem for a Senator to propose an amendment to ban marijuana. Consider that prior to 1920 or so, that's exactly what it would have taken.

And this is the one area where I part from some of my intellectual fellow-travelers. I do not see constitutions as being particularly binding once the payoffs start accumulating. Social capitalization matters.

Fear and Loathing in the CPI

From  Article I, Section 8 of the US Constitution, aka the Enumerated Powers of Congress:

 The Congress shall have Power To... coin Money, regulate the Value thereof, and of foreign Coin, and fix the Standard of Weights and Measures;

A standard weight or measure might be something like a nautical mile or a dram. Even a standard barrel might count*. An ounce is subject to regulation, but a "box" ain't. Curiously, few folks meandering the aisles of your local grocer buy in bulk, so it's almost unheard of to hear "honey, would you pick up 100 grams of toothpaste while you're out?" We buy by the bottle, by the tube, by the loaf, by the case. In other words, we anchor to non-standard units.

And vendors know this. They also understand very well two important vagaries of human nature, both linked to folks' natural tendency to economize on costly information-gathering: it takes quite a shock to jar people from the money illusion and in a cacophony of communication, a lot of relevant information is easy to drown.

This should be intuitively obvious to anyone who's walked into a store. Tell me... do you take the time to do a careful comparative analysis of the nutrition information of each and every food item you purchase, recording panel data along the way and conducting detailed econometric analysis to determine the ideal combination of grocery items? Or are you more like me and you just buy what's on the list, trying 3/4ths-heartedly to avoid buying dairy products that have exceeded the sell-by date? Sure, you know that all those processed foods have filler in them, but did you run a spectrographic analysis to determine what they actually are? Noooooope. Probably nope. Producers know you're a busy person with more important stuff to worry about than whether or not that box of brown sugar is a little bit smaller than the last time you bought it. Or that those fish fingers are a lot more breading and a lot less fish these days. Time is money and every second you spend fretting over the bacon bits is time away from Game of Thrones or whatever it is people are up to these days.

You see, sellers care chiefly about the direct relationship they have with their customers. But there's this little finch sitting on their shoulders. BLS mooks scribble down posted prices and convert that into an index that takes every conscious effort to mimic a typical American consumer. You can read more about the process here. The point is, the BLS folks will treat a bottle of shampoo like a bottle of shampoo, even if it was 24 oz last month and now it's only 22. These figures get drafted into COLA adjustments to transfer payments in a pathetic Ouroboros where the guy trying to get an accurate measure has to stand on the scale to reach the balance beam.

This is all obvious stuff. It's not even the most important critique of the CPI (not by a long shot), but it is the one relevant for euvoluntary exchange. If sellers can "cheat" on the margin by playing fast and loose with package contents and if this jiggering fools both real consumers and the price index, we've got a whole lot of unintentional uncertainty going on. We've got market competition, which tends over time to push prices down, but we've also got a monetary authority who has elected to subscribe to the notion that mild, predictable inflation is good for "the economy" (another metaphor I have a bit of a problem with), and we've got consumers on autopilot who just can't afford the attention needed to stay on top of FOMC operations as needed to isolate relative price changes from inflation. If the alternative is between a state of the world with no elite tinkering of the "price level" (ibid, metaphor) and the status quo, it's not entirely clear to me that there's a slam-dunk case against an unencumbered general equilibrium.

More to the point, the efforts firms waste by fiddling with deceptive packaging thanks to the FRB's policies would probably be better spent improving the actual product. Ditto for the talent employed by the agencies whose job it is to measure the water level of the tub they're standing in.







*The abbreviation for barrel is 'bbl', which comes from Standard Oil. Rockefeller had the same sort of problem I discuss here, except he was the sole buyer. Time was, the derrick workers would snag any old barrel they had lying around and slop the crude right in. Oil contracts were written by the barrel, so it was in ol' JD's interests to standardize the contents thereof. Hence, the "Blue" Barrel (that's the first 'b' in bbl), a uniform 55 gallon blue barrel. Curiously, vertically integrated firms began using the designation, even for non-standard volume barrels like the ones used by distillers and winemakers. Next time you're drinking your oaky chardonnay, try not to think of Daniel Day-Lewis's performance in There Will Be Blood.

Meta-EE and the Constitution Part 13: Seventeenth Amendment

"Well, Doctor, what have we got—a Republic or a Monarchy?"

"A Republic, if you can keep it."

-Ben Franklin

The Senate of the United States shall be composed of two Senators from each State, elected by the people thereof, for six years; and each Senator shall have one vote. The electors in each State shall have the qualifications requisite for electors of the most numerous branch of the State legislatures.

When vacancies happen in the representation of any State in the Senate, the executive authority of such State shall issue writs of election to fill such vacancies: Provided, That the legislature of any State may empower the executive thereof to make temporary appointments until the people fill the vacancies by election as the legislature may direct.

This amendment shall not be so construed as to affect the election or term of any Senator chosen before it becomes valid as part of the Constitution.

The point of a bicameral legislature is precisely to guard against  the excesses of unchecked simple majoritarian democracy. Prior to 1913, if you wanted a gig as a Senator, you'd get it through the political elites in your state. After W.J. Bryan's triumph, you have to petition the people directly.

What effect does this have on the institutions that support euvoluntary exchange? It's tough to say exactly. The median constituent didn't change, but the temporal buffer sure did. The Senate is now marginally more exposed to the whims of the public, for whatever that means. It's sort of difficult to posit a counterfactual America where the 17th never happened. I think it's fair to say that a lot of the Congressional activity that's happened in the interim would have been at least delayed a bit, if not outright nixed.

But flights of fancy aren't particularly convincing. It's kind of tough to lay the arrogance of the FDA's efficacy requirement at the feet of the method by which Senators are elected. In this case, I think I'd simply say that the 17th represents a step away from a Constitutional Republic and a step towards a Popular Democracy. As a Public Choice student, that makes me nervous, but as a Euvoluntary Exchange thinker, I'd have to say that the effects are probably on the slim-to-none side.

Probably.

Meta-EE and the Constitution Part 12: Sixteenth Amendment

Amendment XVI:

The Congress shall have power to lay and collect taxes on incomes, from whatever source derived, without apportionment among the several States, and without regard to any census or enumeration.

From Riker (1964), federalism requires (a) a hierarchy of governments and (b) [de facto, not merely de jure] autonomy at each level. Weingast (1995) adds the following to make federalism market-preserving (i.e. meta-euvoluntary, or close enough for our purposes here) (c) subsidiary governments rather than the national government retain regulatory authority (this helps with Tiebout competition) (d) a de facto and ideally de jure common market exists and (e) sub-national governments face a hard budget constraint (no bailouts for spendthrifty municipalities, no free credit, no hand on the lever of the printing press).

Another way to look at Weingast is that the role of the sovereign authority, the national government is to act as sort of a meta-manager for the subsidiary governments, to keep the rule of law intact. When this is done right, we have one necessary ingredient for baking the cake of economic development. When it's done wrong, it's like someone put too much icing on Jimmy's 10th birthday confection.

Bad metaphors aside, the point of regulatory restrictions is to say "no" to transactions. Sometimes it makes very good sense to say "no" to transactions. Dumping poisons upstream of residential areas is something it makes sense to say "no" to. Clearcutting unowned land is (maybe) something it makes sense to say "no" to. These things may be true, but from this premise does not flow a truism that the central government is either best equipped in terms of knowledge or incentive to utter yon nay.

The 16th might be seen as a leader for the lightning strike that was the 18th, particularly considering Wilson and Harding's peccadilloes, but its effects have proven more pernicious than prohibition. Consider that there is no accidental language in the tax code. Every exemption, every credit, every deduction, every sentence, paragraph, comma jot and tittle represents some vested interest enjoying a nice "conversation" with elected officials on or about the vicinity of Capitol Hill. Instead of turning their talent towards increasing the scope and volume of euvoluntary exchange, firms have every incentive under the 16th to influence tax policy to throttle upstart challengers and jigger the sluices of wealth their way. The amount of political kayfabe needed to support this is perfectly astounding, no matter what your moral axis. That the tax authority has branded itself as being on the right side of the oppressed classes as well as a force for civilization is a simply astounding accomplishment.

Simply astounding.