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I'm saying a free market doesn't exist in healthcare. It exists in lots of other areas. We can see that free markets always perform better, and non-free markets

by javert 7y ago

I'm saying a free market doesn't exist in healthcare. It exists in lots of other areas. We can see that free markets always perform better, and non-free markets are always dysfunctional directly in proportion to the degree of government intervention. There is an overwhelming amount of "data" supporting this. The data is all around us and goes back through history clearly to the Industrial Revolution. But the data also goes even further back; it explains why the Industrial Revolution happened only in certain places and why certain countries are are extremely far ahead of others. But understanding all this requires looking carefully at causation. It's not something you can capture in a study. That's why I put "data" in quotes the first time. > I believe free markets do exist, and have always existed - at the highest levels of human organization. A free market exists when force is barred. The U.S. came close to a free market at the time of its founding and has become progressively more unfree since. Western European countries (particularly England and France, sometimes Germany) have a similar but less pronounced trajectory over the same span of time. International politics is not a free market; it's a collection of armed "gangs" (effectively) that all can use force against one another. Tariffs are also a serious use of force and violation of a free market. A free market literally just means "no force is allowed." If you don't like the term "free market" being used that way, just replace every instance in my comment with "no force is allowed." I'm not interested in arguing about the names of concepts and principles; only about concepts and principles. Gresham's Law is designed to account for a legal tender situation where there are forms of money with the same nominal value under the law but different real value. I will quote a section from Wikipedia which I agree with: "Those examples show that in the absence of effective legal tender laws, Gresham's Law works in reverse. If given the choice of what money to accept, people will transact with money they believe to be of highest long-term value. However, if not given the choice and required to accept all money, good and bad, they will tend to keep the money of greater perceived value in their possession and to pass on the bad money to someone else." [1] I mean, we don't need to trust Wikipedia to see this. People prefer to use the most liquid token of exchange for all transactions, though it also needs to be durable, fungible, etc. The most liquid "token" (and it could even be a commodity) then becomes the best store of value because it is used in transactions. There will never be a place where one money doesn't drive out the other (good drives out the less-good) because one will be more liquid than the other. The whole point of money is just to be something you can trade for anything because everyone will trade it for anything. It solves the "coincidence of wants" problem in a barter economy---the fact that if you are a fisherman and I am an apple grower, I can't buy fish unless you want apples and vice versa. Pardon me for being pedantic; at this point I've gotten into territory that you've very likely encountered before. People would prefer a sound and honest money if there were one. Bitcoin was designed to meet these criteria if it were to become liquid enough; maybe some day it will be, or maybe not. Gold was a sound and honest money, but world governments got us to slowly get off gold, one step at a time. So now it doesn't have enough liquidity and is anyway on shaky ground legally. [1]: https://en.wikipedia.org/wiki/Gresham%27s_law https://en.wikipedia.org/wiki/Gresham%27s_law

EGreg 7y ago
I have heard your arguments many times from people and understand them (after 10 years of discussion). At some point I espoused them myself. I have the following points to make (consider them questions you can answer in detail if you want). 1. Who enforces “no force allowed”? For example in the international markets for labor, currency, and other goods, there is no world police or monopoly on force through a one world government. Sure, countries can have armies. And the same on the individual level - how do you prevent marauders from using force unless you join into an entity with even larger defensive force? That entity will enforce “no force allowed” with force of its own. So even on its own terms, your “free market” system requirement requires a monopoly of force. 2. What if the “sound money” tends to be very expensive to move? Then banks tend to issue representative money or debt denominated in the “sound money” and that is what’s traded every day. It also has the advantage of being reversible so you don’t, for example, have people kidnapped for Bitcoin ransoms. Our current monetary system is largely “seller beware”, instead of “buyer beware”. Presumably, sellers of consumer goods are far larger organizations than buyers, and engage in far more transactions in a given product, and thus can better absorb the cost and quality control to minimize chargebacks and disputes etc. 3. If something is going up in price over time, people want to hoard it not spend it. On the other hand if something is gradually decreasing in price, people want to spend it. These are two sides of the same coin (pun intended). A deflationary currency would NOT be the one that’s actually being spent day to day, but only to occasionally settle debts from everyday transactions. So it depends what you mean by “used” but in terms of frequency, the more “sound” the money is, the LESS FREQUENTLY it is used. For each person who is willing to accept it, there is a person who doesn’t want to give it. Because in practice, the buyer will choose from among all possible payment options the seller offers, and choose the “worst money” to get rid of first. And sellers will compete in a race for who will accept the widest forms of payment (credit cards, venmo, whatsapp or whatever) to get more business. In Capitalism, sellers are always in a race to the bottom unless there is a monopoly. It’s great for consumers but they are also the ones who get to choose among payment options and thus the WORST MONEY will be more frequently in consumer transactions (for goods and services).
- javert 7y ago
  1. A free market requires that the government exercise a monopoly on force, using force. Only the government should be allowed to use force and it should be minimized. International politics will always be a state of nature but treaties and free trade agreements can be good. 2. If the sound money is very expensive to move, people will issue bank notes. I think you are right about that. However, if there are two equally good monies, except that one can be used directly instead of using an intermediary layer (like bank notes), the one that can be used directly will win out in the market and the other one will disappear from use. Because it's less risky when there is no intermediary layer. Then again, there may be use cases when you want reversibility, and then people would use an intermediary (like PayPal). Going through an intermediary some of the time doesn't really create a different currency. For instance, Tethers (which are nominally worth 1 US dollar each) aren't really a different currency (although that's not an ideal example since Tether is so shady; perhaps Gemini Dollars is better). 3. Imagine you have Greatcoin and Shitcoin and those are the two currencies. Merchants take Shitcoin but they immediately convert it to Greatcoin (which holds its value better, or perhaps is deflationary). Consumers don't want Shitcoin, so they also immediately convert it to Greatcoin. Everybody wants Greatcoin in their bank account/digital wallet; nobody wants Shitcoin. I think you can see where this is going. Next time I go to the merchant and try to pay with Shitcoin he's going to say "Come on man, I don't want that shit. Just keep all your money in Greatcoin, which you want to do anyway, and don't convert to Shitcoin before you pay me, and I won't have to convert your Shitcoin to Greatcoin." Then Shitcoin goes away.

by javert 7y ago

EGreg 7y ago

I have heard your arguments many times from people and understand them (after 10 years of discussion). At some point I espoused them myself. I have the following points to make (consider them questions you can answer in detail if you want). 1. Who enforces “no force allowed”? For example in the international markets for labor, currency, and other goods, there is no world police or monopoly on force through a one world government. Sure, countries can have armies. And the same on the individual level - how do you prevent marauders from using force unless you join into an entity with even larger defensive force? That entity will enforce “no force allowed” with force of its own. So even on its own terms, your “free market” system requirement requires a monopoly of force. 2. What if the “sound money” tends to be very expensive to move? Then banks tend to issue representative money or debt denominated in the “sound money” and that is what’s traded every day. It also has the advantage of being reversible so you don’t, for example, have people kidnapped for Bitcoin ransoms. Our current monetary system is largely “seller beware”, instead of “buyer beware”. Presumably, sellers of consumer goods are far larger organizations than buyers, and engage in far more transactions in a given product, and thus can better absorb the cost and quality control to minimize chargebacks and disputes etc. 3. If something is going up in price over time, people want to hoard it not spend it. On the other hand if something is gradually decreasing in price, people want to spend it. These are two sides of the same coin (pun intended). A deflationary currency would NOT be the one that’s actually being spent day to day, but only to occasionally settle debts from everyday transactions. So it depends what you mean by “used” but in terms of frequency, the more “sound” the money is, the LESS FREQUENTLY it is used. For each person who is willing to accept it, there is a person who doesn’t want to give it. Because in practice, the buyer will choose from among all possible payment options the seller offers, and choose the “worst money” to get rid of first. And sellers will compete in a race for who will accept the widest forms of payment (credit cards, venmo, whatsapp or whatever) to get more business. In Capitalism, sellers are always in a race to the bottom unless there is a monopoly. It’s great for consumers but they are also the ones who get to choose among payment options and thus the WORST MONEY will be more frequently in consumer transactions (for goods and services).

javert 7y ago
1. A free market requires that the government exercise a monopoly on force, using force. Only the government should be allowed to use force and it should be minimized. International politics will always be a state of nature but treaties and free trade agreements can be good. 2. If the sound money is very expensive to move, people will issue bank notes. I think you are right about that. However, if there are two equally good monies, except that one can be used directly instead of using an intermediary layer (like bank notes), the one that can be used directly will win out in the market and the other one will disappear from use. Because it's less risky when there is no intermediary layer. Then again, there may be use cases when you want reversibility, and then people would use an intermediary (like PayPal). Going through an intermediary some of the time doesn't really create a different currency. For instance, Tethers (which are nominally worth 1 US dollar each) aren't really a different currency (although that's not an ideal example since Tether is so shady; perhaps Gemini Dollars is better). 3. Imagine you have Greatcoin and Shitcoin and those are the two currencies. Merchants take Shitcoin but they immediately convert it to Greatcoin (which holds its value better, or perhaps is deflationary). Consumers don't want Shitcoin, so they also immediately convert it to Greatcoin. Everybody wants Greatcoin in their bank account/digital wallet; nobody wants Shitcoin. I think you can see where this is going. Next time I go to the merchant and try to pay with Shitcoin he's going to say "Come on man, I don't want that shit. Just keep all your money in Greatcoin, which you want to do anyway, and don't convert to Shitcoin before you pay me, and I won't have to convert your Shitcoin to Greatcoin." Then Shitcoin goes away.