Saturday, May 06, 2006


Oftwhile, in the heat of internet discussion, one may be called out for not being "practical" and "realistic", as though the lack of an empirically encountered basis should bear significance when discussing both the ethical principles which are being ignored, and some of the overlooked ramifications of unsound policy.

For example, free marketeers are often asked of to prove the hypothetical posed by their understanding of economic theory. They ask, "Iceberg, where do these mythical unzoned cities exist?" or one of the old standard canardic "what if's..." followed by what they think is an unsolvable problem which would hence justify state sponsored aggression because they are incapable of thinking the 'problem' through.

As the topic of real estate is within the area of personal interest, my participation on preeminent R.E. blogs makes certain that no harmful governmental policy goes uncriticized and scorned.

Such was the case more than once this week. One may witness the full exchange here of one such discussion, but here were my final words:
I humbly await further explanation of your comments, as I have difficulty understanding what exactly is unrealistic, and why pragmatics matter in discussion of economic or urban theory.

The entire point of discussing theory is to engage in hypothetical and counterfactual speculation, to try and better understand if society is better or worse off due to government intervention into the marketplace, in its regulation of zoning, usage, landmarks, aesthetic, and construction method & materials.

There are reasons to oppose these regulations. First, because they tend to reward certain parties (those with lesser restrictions) at the expense of those parties with higher restrictions.

The restrictions, on their very own raise the bar of entry, hence monopolozing the industry in favor of the firms who are best at cutting through the bureaucratic red tape (i.e. Rockefeller was notorious for his support of industry regulations, in which his firm was more able to implement than other firms, thus helping him drive out his competition with government fiat).

Second, recognizing that no one, or small group of people are all-knowing, it will be impossible for them to divine the far-reaching ramifications of the policies they enact. For example, do the proponents of downzoning take into consideration that they are the foremost cause of driving out the middle-class from the city? Will they be willing to make that trade-off if they knew upfront that the price of housing will go up by x and y amount of people will not be living here because of this narrow-minded policy?

Aside from the economics, I am not too concerned with the arguments calling for "livible cities" or "sustainable development", because first, their arguments are not grounded in reality, but rather emotion, and second, the fault, if any would lie at the doorstep of the prior government interevention which brought about the market aberration they detest. If anything, these people should be clammering for the deregulation of the market to straighten things, not to further strangle and distort them.

I also happen to believe that developers, just like everyone else, usually intend to stay in the game for long-term, and thus are driven toward long-term profitability as their goal, and not short-term embezzlement or fraud.

That being the case, it would only make sense for developers to build the most attractive, livible housing stock as possible. Why you ask, when they could just as well build shoddy housing?

Well, if you would engage in just a tad of hypothethicals, and imagine that there is no artificial limits to how much housing any developer can build, you must imagine too that he will have very serious competition.

Why would they choose developer A's units, when developer B will give them a better unit for the same price?

Hence, it goes to prove that by artificially limiting the amount of buildable space, one of the ramifications is that developers are not competing* anymore in terms of quality, since there is a monopolized stock of which they control, and which is difficult for another developer to mitigate (witness the attempt by the Jack Parker Corp. to increase the housing stock in the west village.) In essense, the government's meddling has both decreased housing stock, housing quality, raises the prices, and later the costs, and the crowning glory- it makes the neighborhoods unaffordable to the middle and lower classes.

*In essense, we have a "market failure" even though the failure was caused by government intervention in the first place.

In a later post, someone labeled me a "free market Pollyanna", which is to say "a person regarded as being foolishly or blindly optimistic".

This title which I find humourous, probably stems from the mistake that we libertarians, like everybody else in the political world, have a "correct" answer to all issues and problems.

As we all know, it's certainly not the case.

The correct answer is that we don't know all the answers to all the "problems". We can't be sure if they are even problemetic. And we certainly don't think that government is the best vehicle to solve these "problems".

In any case, I wrote back:
Thank you, I will take that as a compliment coming from a monomaniac who makes false pretentions as to the astuteness of central planners who must be omniscient in regards to all the far-reaching effects of their policy recommendations.

If anything, I'm the one who is claiming not to have advanced or absolute knowledge of optimal urban planning. Anyone who claims it is possible, is the greater pollyanna and falls into the category of maintaining 'fatal conceit'.
I thought it appropriate that the very day before, Manuel Lora's "Libertarians Are Not Socialists, Prophets, Omniscient or Specialists in Everything" appeared on LRC, and here is my favorite bit:
The problem starts when the "viability" of freedom becomes contingent upon the "answer" to those questions. That is, if the "right" and fully satisfactory answer is not achieved (ignoring that no such answer could ever be 100% correct), then somehow the desire for liberty is lessened and statism creeps back in.

"How would roads work? How can a flu pandemic be prevented? What about organ trafficking? Would we need car insurance? How much? Who would determine that? What if drugs are cheap and widely available? I don’t want people to have AK-47s! What about licensing and standards? If everyone can make their own money, then it’s going to be chaos!"

So let me answer the question as clearly as I can. I am not a socialist!

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