Proportional representation

A person called James Manuell has tweeted that proportional representation (PR) is like the market and first past the post (FPTP) is like a protectionist duopoly so we should adopt PR:

This tweet is wrong.

The state is not a market of any kind. The state is a monopoly on the legitimate use of force by that is held by some particular group of people at any particular time. If you defend yourself or others, the government might sometimes  your use of force was legitimate. But often they won’t. Sometimes the government acts appropriately. But the government might just as well turn around and decide to destroy your life cuz government officials happen to feel like doing that. And if you want any compensation or admission of wrongdoing good luck with that because you’ll need a lot of luck. If enough people happen to like you, then you might be okay, but in most cases if the government takes a dislike to you then you are totally fucked.

As long as we have a state, you have to take account of the fact that it is a monopoly. Any electoral system that doesn’t do that is bad. That system has to allow voters to remove bad parties and policies, otherwise such parties and policies are entrenched permanently. PR fails to do this because it almost always leads to coalition government. The third party gets to be the kingmaker and determine who is in government. And the third party can never be removed from power. Nor can any policy they support ever be revoked. If we had PR the the Liberal Democrats would be in power permanently and we would never be allowed to leave the EU. FPTP produces coalitions less often and enables parties and policies to be removed from power. See The Beginning of Infinity by David Deutsch, Chapter 13 for more explanation of these points.

If you want a market in defence and court services, then you need anarcho-capitalism: multiple competing groups providing court and defence services. A person pretending that our current system is a market or can be made like one by a change in electoral rules is badly mistaken.

Time to pretend

Time to pretend (TTP) is a pop song by a band called MGMT. The song has over 300,000 hits on YouTube, so it is quite popular. I’m going to look at the video and the lyrics and look at the ideas it presents.

The video is very colourful but it doesn’t really have much to do with the lyrics. It serves two purposes. People who just like looking at colours and cats and memes will just like watching the video without needing to give it any more thought. People who think of themselves as more sophisticated will think it looks over the top and will congratulate themselves as being in on the joke. The lyrics also have two interpretations.

Let’s look at the lyrics of the first verse:

I’m feeling rough, I’m feeling raw

I’m in the prime of my life

Let’s make some music, make some money

Find some models for wives

I’ll move to Paris, shoot some heroin

And fuck with the stars

You man the island and the cocaine

And the elegant cars

There are a couple of ways of interpreting these lyrics. Some people might hear the lyrics and think they present a desirable lifestyle: travel, drugs, fucking beautiful women and that sort of thing. A person living like that might sometimes feel bad, e.g.- hangovers, but think that is a price worth paying. Other people might say that the lyrics are satirising and exaggerating that lifestyle, and congratulate themselves on being smarter than the people who just like drugs and sex. The lyrics don’t say which view MGMT actually takes. The lyrics are written to be ambiguous and to allow both interpretations.

The lyrics for the next verse say:

This is our decision, to live fast and die young

We’ve got the vision, now let’s have some fun

Yeah, it’s overwhelming, but what else can we do?

Get jobs in offices and wake up for the morning commute?

Forget about our mothers and our friends

We’re fated to pretend

To pretend

We’re fated to pretend

To pretend

In this verse, MGMT contrast the rock and roll lifestyle with having a normal job and family. MGMT leave it ambiguous which lifestyle they prefer. At the end of the verse they say they’re fated to pretend. They’re admitting that the idea that the rock and roll lifestyle is glamorous and wonderful is a pretence. They are providing a way for people with ordinary jobs and families to pretend that they could have a rock and roll lifestyle where they have fun and no responsibilities. MGMT don’t mention any third alternative, like having your own business or doing philosophy partly because they don’t really understand such ideas and partly because most of the potential audience wouldn’t understand or like such ideas.

Some people will interpret the verse differently as mocking the rock and roll lifestyle as a lonely and boring pretence at having fun. Actually having relationships with family and friends is better than the rock and roll lifestyle as it is usually portrayed.

There is another point to note.  MGMT say they are “fated to pretend”, which implies that they don’t have a choice about whether to pretend. But they start the verse by saying “This is our decision”. This is an admission that MGMT and the audience could take responsibility for improving their lives, but they prefer to pretend that they have no choice but to live the way they do.

I’m not going to go through the rest of TTP because the rest of the song is similar to what I’ve discussed so far. TTP is a sophisticated presentation of a philosophical package deal. Your alternatives are either to be an irresponsible, drug taking rock star or have a normal life and a family. In reality, you could develop a better life than either of these alternatives but that requires thinking and taking responsibility, which most people don’t want to do. The standard pattern of having a job and a family exists for a reason: it’s a way of living that most people can tolerate and doesn’t require much innovation. Sex, drugs and rock and roll lifestyles are harder to maintain and tolerate and involves deliberately disabling your ability to think through drugs and so on a lot of the time in order to keep going.

Many people with a standard family life do a substantial amount of sex and drugs to make their lives tolerable. So the distinction between the sex, drugs and rock and roll lifestyle and normal family life isn’t as sharp as people like to pretend. The differences between those lifestyles are a matter of degree rather than a qualitative difference since they are both set up so that people can enact them with as little thought as possible.

Criticising Taleb’s Precautionary Principle Paper

Nassim Nicholas Taleb has written an essay about his own variant of the precautionary principle (PP). I’m going to point out some problems with the essay and Taleb’s variant of the PP and then criticise Taleb’s argument against genetically modified organisms (GMOs).

In Section 1 Taleb writes:

The PP states that if an action or policy has a suspected risk of causing severe harm to the public domain (such as general health or the environment), and in the absence of scientific near-certainty about the safety of the action, the burden of proof about absence of harm falls on those proposing the action. It is meant to deal with effects of absence of evidence and the incompleteness of scientific knowledge in some risky domains.

In Section 2.2 Taleb writes:

The purpose of the PP is to avoid a certain class of what, in probability and insurance, is called “ruin” problems [1]. A ruin problem is one where outcomes of risks have a non zero probability of resulting in unrecoverable losses. An often-cited illustrative case is  that of a gambler who loses his entire fortune and so cannot return to the game. In biology, an example would be a species that has gone extinct. For nature, “ruin” is ecocide: an irreversible termination of life at some scale, which could be planetwide. The large majority of variations that occur within a system, even drastic ones, fundamentally differ from ruin problems: a system that achieves ruin cannot recover. As long as the instance is bounded, e.g. a gambler can work to gain additional resources, there may be some hope of reversing the misfortune. This is not the case when it is global.

In The Beginning of Infinity Chapter 9, David Deutsch writes:

Blind optimism is a stance towards the future. It consists of proceeding as if one knows that the bad outcomes will not happen. The opposite approach, blind pessimism, often called the precautionary principle, seeks to ward off disaster by avoiding everything not known to be safe. No one seriously advocates either of these two as a universal policy, but their assumptions and their arguments are common, and often creep into people’s planning.

Deutsch then criticises the PP at some length. I’m not going to reproduce the entire criticism, but I’ll explain the basic point. The PP assumes that new innovations will make the world worse and so that current knowledge is basically okay and not riddled with flaws that might lead to the destruction of civilisation. But our knowledge is riddled with flaws that might destroy civilisation. Human beings are fallible so any piece of knowledge we have might be mistaken. And those mistakes can be arbitrarily large in their consequences because otherwise we would know we were right every time we made a decision above the maximum mistake size. In addition, we can be mistaken about the consequences of a decision so a mistake we think is small might turn out to be a large mistake. The only way to deal with the fact that our knowledge might be wrong is to improve our ability to invent and criticise new ideas so we can solve problems faster. Taleb doesn’t address any of these points in his paper. He doesn’t refer to BoI. Nor do any of the arguments in his paper address Deutsch’s criticisms of the PP.

Taleb also makes an argument criticising the use of GMOs (Section 10.3):

The systemic global impacts of GMOs arise from a combination of (1) engineered genetic modifications, (2) monoculture—the use of single crops over large areas. Global monoculture itself is of concern for potential global harm, but the evolutionary context of traditional crops provides important assurances (see Figure 8). Invasive species are frequently a problem but one might at least argue that the long term evolutionary testing of harmful impacts of organisms on local ecological systems mitigates if not eliminates the largest potential risks. Monoculture in combination with genetic engineering dramatically increases the risks being taken. Instead of a long history of evolutionary selection, these modifications rely not just on naive engineering strategies that do not appropriately consider risk in complex environments, but also explicitly reductionist approaches that ignore unintended consequences and employ very limited empirical testing.

Biological evolution doesn’t limit harmful impacts of species. Variations on genes arise as a result of mutation and any particular gene either manages to copy itself or not. The knowledge created in genes is just as fallible as the knowledge created by human beings. So there is no particular reason why a species should not evolve that would cause a disaster. This has happened in the past. For example, the black death killed somewhere between 30 and 60 per cent of Europe’s population. We should develop the knowledge of how to manipulate genes partly so we can try to stop events like that from happening in the future.

Utility doesn’t exist

Somebody called Mr House has posted on twitter about the law of diminishing marginal utility citing Mises:

I think this post is wrong. There are no units of satisfaction. Any decision can and should be discussed without any reference at all to such units, except for the purpose of refuting ideas that refer to those units.

In Part One, Chapter VII, Section 1 of Human Action Mises writes:

Acting man values things as means for the removal of his uneasiness. From the point of view of the natural sciences the various events which result in satisfying human needs appear as very different. Acting man sees in these events only a more or a less of the same kind. In valuing very different states of satisfaction and the means for their attainment, man arranges all things in one scale and sees in them only their relevance for an increase in his own satisfaction. The satisfaction derived from food and that derived from the enjoyment of a work of art are, in acting man’s judgment, a more urgent or a less urgent need; valuation and action place them in one scale of what is more intensively desired and what is less. For acting man there exists primarily nothing but various degrees of relevance and urgency with regard to his own well-being.

This paragraph makes it sound like there might be units of satisfaction that you could attach to goods. Mises contradicts this idea in the next paragraph:

Quantity and quality are categories of the external world. Only indirectly do they acquire importance and meaning for action. Because every thing can only produce a limited effect, some things are consider scarce and treated as means. Because the effects which things are able to produce are different, acting man distinguishes various classes of things. Because means of the same quantity and quality are apt always to produce the same quantity of an effect of the same quality, action does not differentiate between concrete definite quantities of homogeneous means. But this does not imply that it attaches the same value to the various portions of a supply of homogeneous means. Each portion is valued separately. To each portion its own rank in the scale of value is assigned. But these orders of rank can be ad libitum interchanged among the various portions of the same magnitude.

In later paragraphs he clarifies further:

The assignment of orders of rank through valuation is done only in acting and through acting. How great the portions are to which a single order of rank is assigned depends on the individual and unique conditions under which man acts in every case. Action does not deal with physical or metaphysical units which it values in an abstract academic way; it is always faced with alternatives between which it chooses. The choice must always be made between definite quantities of means. It is permissible to call the smallest quantity which can be the object of such a decision a unit. But one must guard oneself against the error of assuming that the valuation of the sum of such units is derived from the valuation of the units, or that it represents the sum of the valuations attached to these units.

A man owns five units of commodity a and three units of commodity b. He attaches to the units of a the rank-orders 1, 2, 4, 7, and 8, to the units of b the rank-orders 3, 5, and 6. This means: If he must choose between two units of a and two units of b, he will prefer to lose two units of a rather than two units of b. But if he must choose between three units of a and two units of b, he will prefer to lose two units of b rather than three units of a. What counts always and alone in valuing a compound of several units is the utility of this compound as a whole–i.e., the increment in well-being dependent upon it or, what is the same, the impairment of well-being which its loss must bring about. There are no arithmetical processes involved, neither adding nor multiplying; there is a valuation of the utility dependent upon the having of the portion, compound, or supply in question.

I think a clearer account of the law of marginal utility would go like this. One unit of a particular good will allow you to solve problem 1. The second unit will allow you to solve problem 2. There is some particular reason why you prefer solving problem 1 to problem 2. For example, suppose that you’re considering how much electricity to buy. The next unit of electricity allows you to heat your house so you don’t freeze to death. The unit after that will allow you to read a book. Since you can’t read a book if you’re dead you prefer to use the next unit to heat your house rather than devote it to reading. It’s not the case that your use of electricity is explained by the existence of some set of units in which not freezing to death is two units and reading is only one unit or anything like that.

Thinking about goods in terms of units of utility does serious harm in many discussions. People often make arguments saying the rich should pay more taxes on their higher income than on their lower income because the higher income less. This is wrong because the rich person doesn’t count the value of his income in terms of units and assign fewer units to later income. He just chooses to solve an additional set of problems with higher income and he has some reason for choosing to solve the those additional problems after solving other problems. No units of utility are involved.

Another problem with this focus on units of utility is that it gives the illusion that some outside observer can assign more units of utility to giving the rich man’s last $1 million to poor people in the form of, say, 1000 grants of $1000 each. This overlooks the following fact. The poor person chooses to spend his income, time  and attention on solving some particular set of problems for some particular set of reasons. This may include the poor person choosing to give the rich person money in the form of paying for cold and flu lemon drinks with paracetamol in them, say.  The poor person prefers to give somebody money to solve that problem rather than keep the money and spend it on something else. A politician taxing the rich person and giving the cost of the cold and flu drink back to the poor person is overriding the poor person’s preference that the company making the drink should have that money and the poor person should get the drink in exchange.

The idea of units of utility is a misrepresentation of actual decision making and it can and should be eliminated from any correct economic argument.

Some criticism of Rothbard on foreign policy

I’m in favour of free markets and of reform to get the state out of the provision of all of the services it currently provides. The political coalition most strongly associated with this position is libertarianism. I’m not a libertarian partly because that label doesn’t actually identify any particular philosophy or set of ideas. Some people even argue for a welfare state and call themselves libertarians.  Another problem is that many libertarians adopt a position that they describe as anti-war, but it doesn’t make much sense and it’s not particularly difficult to find problems with it if you look for them.

The main inspiration for the libertarian anti war position is the work of Murray Rothbard so I’m going to criticise his position as expressed In his book For a New Liberty: The Libertarian Manifesto. In chapter 14 Rothbard writes about foreign policy. I’ll start with a quote from p. 331:

Pending the dissolution of States, libertarians desire to limit, to whittle down, the area of government power in all directions and as much as possible. We have already demonstrated how this principle of “de-statizing” might work in various important “domestic” problems, where the goal is to push back the role of government and to allow the voluntary and spontaneous energies of free persons full scope through peaceful interaction, notably in the free-market economy. In foreign affairs, the goal is the same: to keep government from interfering in the affairs of other governments or other countries. Political “isolationism” and peaceful coexistence— refraining from acting upon other countries—is, then, the libertarian counterpart to agitating for laissez-faire policies at home. The idea is to shackle government from acting abroad just as we try to shackle government at home. Isolationism or peaceful coexistence is the foreign policy counterpart of severely limiting government at home.

Libertarians are supposed to be against the initiation of the use of force. But if some person or group initiates the use of force then you can use force against them to defend yourself. A free market requires institutions for mediating disagreements about the use of force. Those institutions would sometimes impose a solution to a problem without the consent of some of the people involved. For example, if a thief steals a car he may not want to give it back to the owner but he’ll have to give it back anyway. So the use of force may be required for justice in some cases.

Now, let’s suppose that a criminal flees from state A to state B. Should state A try to get him extradited? Does this count as interference? Suppose that state B doesn’t want to extradite the criminal. Should state A leave the criminal in state B?

What if state B declares that any murderer from state A is welcome in state B?

What if state B not only says that murderers from state A are welcome, but if they have suitable evidence of the murder state B will pay them a large reward? Should state A be able to use force in that situation even though that would be a war in all but name? I don’t see how the principle of not initiating the use of force dictates what state A should do.

Rothbard continues (pp. 331-332):

Specifically, the entire land area of the world is now parcelled out among various States, and each land area is ruled by a central government with monopoly of violence over that area. In relations between States, then, the libertarian goal is to keep each of these States from extending their violence to other countries, so that each State’s tyranny is at least confined to its own bailiwick. For the libertarian is interested in reducing as much as possible the area of State aggression against all private individuals. The only way to do this, in international affairs, is for the people of each country to pressure their own State to confine its activities to the area it monopolizes and not to attack other States or aggress against their subjects. In short, the objective of the libertarian is to confine any existing State to as small a degree of invasion of person and property as possible. And this means the total avoidance of war. The people under each State should pressure “their” respective States not to attack one another, or, if a conflict should break out, to withdraw from it as quickly as physically possible.

Let us assume for the moment, a world with two hypothetical countries: Graustark and Belgravia. Each is ruled by its own State. What happens if the government of Graustark invades the territory of Belgravia? From the libertarian point of view two evils immediately occur. First, the Graustark Army begins to slaughter innocent Belgravian civilians, persons who are not implicated in whatever crimes the Belgravian government might have committed. War, then, is mass murder, and this massive invasion of the right to life, of self- ownership, of numbers of people is not only a crime but, for the libertarian, the ultimate crime. Second, since all governments obtain their revenue from the thievery of coercive taxation, any mobilization and launching of troops inevitably involve an increase in tax-coercion in Graustark. For both reasons—because inter-State wars inevitably involve both mass murder and an increase in tax-coercion, the libertarian opposes war. Period.

Let’s say that the government of Belgravia decides to exterminate all the kazoo players in Belgravia, and that it murders critics of the Begravian regime. Belgravia  might also use force against neighbouring states. This is the sort of situation that people in favour of war often raise as an example of when they would like to invade a country.

Some citizens of Belgravia may be silent out of fear. Those citizens might prefer an invasion to continuing to live in fear under the Belgravian regime. We can’t tell because they’re not allowed to express such an opinion.

Other Belgravians may be happy about the extermination of the kazoo players if the government gives Belgravians the kazoo players’ property, or because they just hate kazoo players. These citizens are willing participants in activity that would be criminal in a free society.

The Belgravian state can extract a lot of tax and property from its citizens to wage war. So if those citizens are completely off limits, Belgravia can wage war and kill Graustarkians for a long time. I’m not saying Graustark should kill every Belgravian but the situation isn’t as clear cut as Rothbard makes it sound.

Rothbard claims that if any war starts a more libertarian would withdraw as quickly as possible. Does this mean that the government of Graustark should withdraw from any Graustarkian territory that Belgravia conquers and leave its kazoo playing or free thinking citizens to be murdered?

Wars waged by states are funded by tax and other means of taking property without the owners’ consent. But states forbid people from providing for their own defence, so how can organised defence work if the state doesn’t wage wars in defence of its citizens? You can say that you want defence services to be provided in the free market, but we don’t know how to do that yet, so what are people supposed to do in the meantime to minimise the initiation of the use of force?

Later in the same chapter, Rothbard writes (p. 335):

But there is yet another fatal flaw in the analogy with individual aggression. When Smith beats up Jones or steals his property we can identify Smith as an aggressor upon the personal or property right of his victim. But when the Graustarkian State invades the territory of the Belgravian State, it is impermissible to refer to “aggression” in an analogous way. For the libertarian, no government has a just claim to any property or “sovereignty” right in a given territorial area. The Belgravian State’s claim to its territory is therefore totally different from Mr. Jones’s claim to his property (although the latter might also, on investigation, turn out to be the illegitimate result of theft). No State has any legitimate property; all of its territory is the result of some kind of aggression and violent conquest. Hence the Graustarkian State’s invasion is necessarily a battle between two sets of thieves and aggressors: the only problem is that innocent civilians on both sides are being trampled upon.

This line of argument requires that all states should be regarded as equivalent and nobody should prefer living under one state or another. In reality, some states initiate the use of force to a greater extent than others. So if the government of Belgravia is overthrown and replaced that might reduce the extent of the initiation of the use of force.

I also don’t think the anti-war position is actually going to prevent or minimise war. If the Graustarkian state claims it will never wage war under any circumstances, then anti-liberal states who aren’t opposed to the initiation of the use of force may see that as an opportunity to wage a war to plunder and kill Graustarkians. Minimising war requires being able to use force in  an organised way to stop aggressive states – it requires being willing to fight wars.

Hayek vs liberty 2

In a previous post, I pointed out that Hayek wasn’t in favour of free markets because he explicitly said it might sometime be good for a government to stop competition. Hayek was also in favour of the welfare state in this quote from The Road to Serfdom, Chapter 9, pp. 124-125 of the Routledge Classics edition:

There is no reason why in a society that has reached the general level of wealth which ours has attained, the first kind of security should not be guaranteed to all without endangering general freedom. There are difficult questions about the precise standard which should thus be assured; there is particularly the important question whether those who thus rely on the community should indefinitely enjoy all the same liberties as the rest. An incautious handling of these questions might well cause serious and perhaps even dangerous political problems; but there can be no doubt that some minimum of food, shelter, and clothing, sufficient to preserve health and the capacity to work, can be assured to everybody. Indeed, for a considerable part of the population of this country this sort of security has long been achieved.

Nor is there any reason why the state should not assist the individuals in providing for those common hazards of life against which, because of their uncertainty, few individuals can make adequate provision. Where, as in the case of sickness and accident, neither the desire to avoid such calamities nor the efforts to overcome their consequences are as a rule weakened by the provision of assistance, where, in short, we deal with genuinely insurable risks, the case for the state helping to organise a comprehensive system of social insurance is very strong. There are many points of detail where those wishing to preserve the competitive system and those wishing to supersede it by something different will disagree on the details of such schemes; and it is possible under the name of social insurance to introduce measures which tend to make competition more or less ineffective. But there is no incompatibility in principle between the state providing greater security in this way and the preservation of individual freedom. To the same category belongs also the increase of security through the state rendering assistance to the victims of such “acts of God” as earthquakes and floods. Wherever communal action can mitigate disasters against which the individual can neither attempt to guard himself, nor make provision for the consequences, such communal action should undoubtedly be taken.

There are some interesting things to note about this quote. The first paragraph doesn’t clearly state that the government should provide food, clothing and shelter. Hayek just states they “can be assured to everyone”. Somebody has to produce this food, clothing and shelter. If everyone can be assured access to those goods, then the people who produce them must hand them over regardless of whether they consent. The phrase “can be assured to everyone” is a promise that can be delivered only by coercion.

The second paragraph explicitly claims that the government should provide insurance for health and unemployment. Hayek’s position is that these goods should be provided at the point of a gun. Hayek was in favour of the welfare state, not against it. He has provided an excuse for people on the right to continue to back the welfare state while claiming to be capitalists.

People claiming to be capitalists have claimed that Hayek was in favour of free markets. Hayek’s actual position is that the free market can provide stuff as long as it isn’t anything important like food, clothing, shelter, medical care or provision for periods of unemployment. According to Hayek, the free market can produce novelty figurines and chewing gum, but nothing that is required for survival. That’s why conservatives like Hayek so much, he doesn’t ask them to make any important or difficult choices. They can just continue to back the present system with minor modifications. If the present system collapses because the government has run out of people to tax, and they have finally destroyed the value of money through inflation and there are riots and bloodshed on the streets, conservatives will say they followed the advice of a Nobel prize winning free market economist. That’s why Ayn Rand was correct to describe Hayek as “real poison” (Letters of Ayn Rand, p. 308).

Hayek versus liberty

F.A. Hayek is often praised as an advocate of liberty. In reality, Hayek mixed liberal (free markets and individual liberty) and anti-liberal traditions and said we should make trade offs between them. In Chapter 4 of The Road to Serfdom, pp. 53-54 of the Routledge  Classics edition, Hayek wrote:

There is yet another theory which connects the growth of monopolies with technological progress, and which uses arguments almost opposite to those we have just considered; though not often clearly stated, it has also exercised considerable influence. It contends, not that modern technique destroys competition, but that, on the contrary, it will be impossible to make use of many of the new technological possibilities unless protection against competition is granted unless a monopoly is conferred. This type of argument is not necessarily fraudulent, as the critical reader will perhaps suspect: the obvious answer, that if a new technique for satisfying our wants is really better, it ought to be able to stand up against all competition, does not dispose of all instances to which this argument refers. No doubt in many cases it is used merely as a form of special pleading by interested parties. Even more often it is probably based on a confusion between technical excellence from a narrow engineering point of view and desirability from the point of view of society as a whole.
There remains, however, a group of instances where the argument has some force. It is, for example, at least conceivable that the British automobile industry might be able to supply a car cheaper and better than cars used to be in the United States if everyone in this country were made to use the same kind of car; or that the use of electricity for all purposes could be made cheaper than coal or gas if everybody could be made to use only electricity. In instances like these it is at least possible that we might all be better off, and should prefer the new situation if we had the choice-but that no individual ever gets the choice, because the alternative is that either we should all use the same cheap car (or all should use only electricity), or that we should have the choice between these things with each of them at a much higher price. I do not know whether this is true in either of the instances given. But it must be admitted that it is possible that by compulsory standardisation or the prohibition of variety beyond a certain degree, abundance might be increased in some fields more than sufficiently to compensate for the restriction of the choice of the consumer. It is even conceivable that a new invention may be made some day whose adoption would seem unquestionably beneficial, but which could be used only if many or all people were made to avail themselves of it at the same time.

Hayek is claiming that sometimes it might be a good idea to force people to use some particular items rather than allowing free choice. This is an anti-liberal position and it’s also wrong. Hayek claims that forcing people to use  some item X would be good for them. But if people are forced to use X then how would we know whether they prefer it to some other option? Since they are being forced to use X they can’t turn it down in favour of something else. So the policy of forcing people to use X would prevent that policy from being corrected if it was wrong.

How could this problem work out in practice? It might be the case that if you invested in machinery capable of making 1 million Lada cars each year, then the unit cost of making each Lada would be a lot cheaper than the cost of making lots of different kinds of cars. But Ladas might actually be bad for some applications so that if people are forced to buy them their lives are worse despite the cheaper price. For example, people with long legs might have difficulty fitting inside a Lada so that they find riding in a Lada very uncomfortable. But that doesn’t matter to the Lada maker cuz the tall person is forced to buy a Lada. In addition, there is no particular reason to think the Lada manufacturer would make 1 million Ladas each year at a low unit cost. He might increase the unit costs and make fewer Ladas cuz he has a captive market. And since he has a captive market the Lada manufacturer can make money without bothering to improve his cars or make them cheaper. Restricting consumer choice also makes it difficult for the Lada maker to know what improvements people want cuz they have to take whatever he makes. The Lada maker might even have difficulty maintaining the machinery he has for making cars. If people have to take whatever he produces, then they may not report faults as a result of manufacturing problems. He also can’t motivate his staff to the same extent as under freedom cuz they can’t lose customers to competitors. So the staff may not fix machines as efficiently as they would if their company was more sensitive to consumer preferences. The Lada manufacturer also can’t benefit from copying innovations made by his competitors cuz he has none.

Hayek sucks and you shouldn’t recommend him as an advocate of liberty.