Rocco: Pest Justice

Pop quiz, hotshot: There’s a rat in your kitchen – what are you gonna do? Shriek? Fair enough. But after that, though. Call a pest controller? Yeah, sounds like a good idea to me. Now then, which one? Which of the many pest controllers available will you call? Don’t answer that. It’s rhetorical.

I don’t think I’d be wrong if I said that everyone who reads Bogpaper favours free markets. Or, at least, favours free markets to a large extent. And I don’t think I’d be wrong if I went on to say that the majority do so because they understand that they, as customers, are better off when there’s competition among businesses, than when there’s no competition among businesses.

Let’s quickly rehearse some of the reasons: Without competition a producer has no need to keep costs down. Without competition a producer has no need to keep prices down. Without competition a producer has no need to maintain, let alone improve, the quality of his product. Without competition a producer has no need to treat his customers well. Etc, etc, etc.

In fact, so powerful and so beneficial is competition, that – as long as entry into the market is not prohibited – even in the absence of actual competitors a business will have to act as if it had them. Abnormally high profits are not only a powerful incentive for others to enter the market, but they spur the development of substitute products. High prices, low quality, poor service and the rest, make it that much easier to lose market share to potential rivals. (This is, by the way, why we should distinguish between compulsory, ie, State or State-maintained monopolies, and businesses who currently have no competitors. Only the former are immune to market forces.)

So, in the specific case of pest controllers – but, naturally, the economics apply to any other service or product – it’s easy to see why we, as customers, prefer to have a choice of supplier. We have a problem we need taking care of, and the existence of a market offers us the best chance of finding a good solution. Competition among various pest controllers keeps prices low and standards high. The fear of losing custom ensures that whichever pest controller we employ will (unless they are incredibly stupid) make every effort to leave us satisfied with their performance.

It is obvious, then, what would happen if competition among pest controllers was forbidden, ie, if the government nationalised pest control. Costs and prices would go up, quality and customer satisfaction would go down. If a producer is getting paid anyway, why should he care whether you’re happy or not? Why should he do a good job? Why should he be polite, even?

This is uncontroversial among supporters of free markets, of course. I’m confident that not a single reader of Bogpaper (regular BP reader, anyway) would disagree with any of this.

Now, what if the State didn’t talk about “pest control,” but instead “pest justice”? “Justice” – that’s a heavy word. Plato wrote about justice. Aristotle did, too. How many thousands of books have been written about justice? What a terribly complicated business it must be. Far too complicated to be left to the vagaries of the market. I mean, think about it – letting people have a choice in pest justice? That’s madness! We can’t have just anyone going about carrying out pest justice, can we? No, we need one, and one only, distributer of pest justice – otherwise there’d be chaos. The State must have the monopoly on pest justice. And it must be funded via expropriation. That will keep costs down. That will keep prices down. That will keep quality high and ever-improving. That will ensure that all the incentives are in place for maximising customer satisfaction.

No one would argue like this. No one would be fooled by the word “justice”. No one would say that a compulsorily funded monopoly would produce results preferable to the results a market would produce. And even though we can’t entirely rule out the possibility that a gang of super-intelligent rats might one day emerge and attempt to wreak havoc in our kitchens, no free marketeer would believe that the State would do a better job of protecting us than would private enterprise.

The reason for this is that we understand that free markets incentivise socially beneficial behaviours, allowing them to bloom and flourish, whereas compulsory monopolies disincentivise such behaviours, forcing them to wither and atrophy. And we understand, furthermore, that this economic reasoning of ours, being a priori, is true of any conceivable product or service. Including – to pick an example at random – the police.

Links to all my posts for Bogpaper and Libertarian Home can be found on google plus: Rocco Bogpaper

  • AeronPage

    i’d probably go get my Brno

  • http://concretebunker.wordpress.com/ Concrete Bunker

    The police are lousy rat catchers!

  • therealguyfaux

    Then you have the ridiculous example in America of the New Deal Democrats, no real capitalists they by any stretch, who brought suit against ALCOA for having monopolised the aluminium industry by being so efficient and having anticipated the market so well, it made for any possible competing entrants into the market not to be able to operate at a profit. In other words, ALCOA’s only competition was itself– it produced so much aluminium that scrappers were able to gain ten percent of the US domestic market thereby, without having to actually produce the metal. The only ones selling aluminium more cheaply than ALCOA were selling second-hand ALCOA product.

    It didn’t matter that the firm wasn’t gouging its customers nor that it held a “monopoly” simply in virtue of its being the only manufacturer who could possibly turn a profit– and apparently not all that much of one, if they were content to leave pricing to follow cost in such a way that no one else could MAKE it for less and sell it even more cheaply than ALCOA in order to undercut them. Nope– ALCOA was a “monopoly,” and that’s all that mattered.

    “In fact, so powerful and so beneficial is competition, that – as long as entry into the market is not prohibited – even in the absence of actual competitors a business will have to act as if it had them.” That’s what ALCOA did– and no good deed went unpunished.

  • AeronPage

    Would you consider patent laws also akin to a kind of monopoly? As you are using legislative power to suppress competition in particular sectors?
    For instance, I work in the appliance industry (if it can be called an industry). And you may have heard of a particular British manufacturer of bagless vacuums. In my professional opinion, they are well overpriced, in terms of quality of materials etc. but they are patented to the eyeballs, so can essentially charge whatever they please, without necessarily making a good product, as they have essentially eliminated the possibility of having fair competition.
    I would be intrigued to know your take on intellectual property, my personal view is that it is impossible to “own” an abstract concept.

    • Rocco @Bogpaper

      Intellectual ‘property’ is nothing but a monopoly – it’s impossible to conceive of it in any other way.

      It gives the holder rights over others’ property. For instance, if you were to copy out word for word the above article, if I own the article I can prevent you from doing that. That is, I can stop you using your hand, your pen, your paper in certain ways, using violence if necessary, even though there is no preexisting contract between us that says I can do that. It’s your hand, your pen, your paper – but I have been granted control over them by the State. And for what? What have I lost if you copy an article of mine? What’s been taken from me? Nothing.

      The most that can be said is that now I can’t be the exclusive seller of the article. And why is this a problem? Because you might receive money that I could have received. But I don’t own *this* money either! I never owned it in the first place – it’s someone else’s money.

      • AeronPage

        The only problem I can see is if you were to publish/sell something under the guise of somebody else, which would surely constitute fraud?

        • Rocco @Bogpaper

          Yeah, that’d be fraud.

          • AeronPage

            Good. I often have arguments with one of my more Utilitarian leaning friends who still can’t grasp that patents are essentially monopoly. His argument is that you should be able to profit from an invention, even for a limited patent length. My argument is that surely as the initial inventor, you would still have a competitive advantage, and as above, the only problem would be if I copied something and sold it as them, but if I sold it under my own name there should be no issue.

  • silverminer

    Peel set up the police to keep the working classes in order. Thin blue line to protect the Elites, always has been. Do away with the lot of them. Everyone has exactly the same arrest powers as a Police Constable, so we can have our own volunteer neighbourhood peace officers. Private investigators can do as good a job in complicated crimes and they’d be working for the victim, not the State. Private prosecutions instead of the CPS. Privately run Common Law courts with juries. What’s not to like?

    • AeronPage

      What about the right to self defence/property rights of which there seems to be a complete lack of in this country?

      “Subjects’ Arms.
      That the Subjects which are Protestants may have Arms for their Defence suitable to their Conditions and as allowed by Law.”

      The only problem with this is the “as allowed by law” bit, and “which are Protestants”

      • silverminer

        Quite right. Use of self defensive force to protect your person and your property and you would hope others would come to your aid when attacked as you would do for them. When every second counts, the police are 20 minutes away…

        • Rocco @Bogpaper
          • AeronPage

            I do find it quite odd how people feel guns should be banned for the general populace, yet letting one group run around with all the guns is a good idea, as in your article, most people would agree that competition is good…….except the police/army/healthcare etc.
            Then you get the “Mafia would take over” types. Good article from Robert P. Murphy here;
            https://mises.org/daily/1855

            As well with your argument with Russell Taylor on the prisons article, why is it magically only bad people who are capable of banding together?

          • silverminer

            Police behave like a Mafia these days. Hanging out in souped -up BMWs on street corners shaking people down for fines and fees. Law is meant is protect the people, render them more secure in their person and their property, not to be used against them. System is not fit for purpose so get rid.

          • AeronPage

            Yeah, like in all the cop shows, the police behave more like gangsters than the gangsters. TV is where the social engineering’s at now. “Yeah I wanna be a cop too so I get a gun and get to fuck with people like on the TV”. I was flicking through last night, all it was was police this that and the other, or social services, or apologia for the military.

        • AeronPage

          What? like in South Africa where the official line is to hide in your room and hope not to get shot? Sounds marvellous!