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Incentives for morality in Laizzes Faire Capitalism vs Science

More more, I want more!!!
More more, I want more!!!

I wrote most of the following years ago, in grad school.  Little did I know, in a few years I would watch my boyfriend be brainwashed into an Anarcho-Capitalism cult!

Did I mention I have a “The Polish Ambassador” addiction?  Here’s another song by TPA to listen to during this post.  I can’t wait to see him live again in the Fall!!!!  If you ever get the chance to do so, please, take advantage of the opportunity.  He is an amazing showman!


There seems to be some people in the world who think we need to get rid of all government regulations and our economy would do better and everything would be hunky dorey and even homelessness would end.  Yeah, right, people really believe that!  The ideal of laissez faire capitalism is what many people believe strongly is best.  These people often think our problems are all from government intervention and if we would just leave companies alone, they would do all the right things and never pollute our water or air or cause harm to their workers, customers, or anyone who just gets in their way because they would self regulate somehow, with the magical powers of “the market”.   Invisible hands are way more rational than invisible sky gods.

That’s kind of like anarchy.  It’s like assuming that if we just got rid of all laws and government, people would all just do the right thing and we wouldn’t need laws and government.  That got me thinking, it will never ever possibly work out that way because capitalism, just like society itself, is a human social endeavor.  We can’t escape our humanity just by starting a company.  The company doesn’t run itself like an Android, it is run by people.  Groups of people, even with oversight from other people, aren’t infallible (think Nazi Germany, slavery in the US, etc).  Groups of people are just as prone to the idiotic mistakes of individual people and immoral behavior, maybe even moreso because of groupthink, because when we agree we think we are extra extra right.  So, there’s this idea that somehow the competition of the market will make it work out ok in the end.  OK, except, that is assuming that there is competition if we deregulate the marketplace, but often when we step out companies just get bigger and bigger and this gets rid of competition.  Say the Nazi’s had won WW2, or if Pearl Harbor had never been attacked and the US stayed out of WW2, then the Nazis would have won and competition between countries would be down because they were taking over everything, but they weren’t doing it by being a great country, at least, morally.

So that got me to thinking about another human social endeavor, science.  Science is done by humans with the goal of better understanding how the universe works.  The goal is truth, at least, of science as a whole.  The goals of individual scientists are varied, some may just want to make a name for themselves, some just want to know more how the universe works because they have the curiosity gene (I totally have that!), some may just like doing math (string theorists!).  What keeps scientists from always doing bad stuff, ie. fraud, screwing over other scientists, etc?  Well, first of all, if someone finds out you have done fraud  you are so screwed, you will lose all respect you ever had and lose your entire life in science, often even have your PhD taken away.  Scientists do not let fraud just go (though this doesn’t seem to be true in the climate change community, but we know now it’s not science but a psuedo-religion and religions don’t really care about truth).  We take it seriously because it goes against the entire basis of science, ie. the search for truth.  So fundamentally, scientists self-regulate fraud, at least, eventually.  In capitalism, fraud and other bad behavior can get you forward and is often in line with the goals of making more money.  The only way it backfires is if your customers find out AND take that out on you.  However, your customers aren’t always the ones negatively affected by the fraud and it doesn’t necessarily go against everything they hold dear, so the incentives to take bad behavior out on the company are not so strong.  In addition, bad treatment of workers, assuming there is not currently a worker shortage, won’t really affect a majority of customers.  The self-regulation of the marketplace is nowhere near as strong in incentives as science.  And science is SO NOT PERFECT, even with strong incentives to at least try to keep our noses down on the search for truth and not let our stupid fallible humanity screw things up too much.

What other forms of self-regulation exist in science?  Well, to actually get your science “product” out into the “marketplace” of ideas, you need to publish in a peer reviewed journals.  Peer review is a major form of self-regulation in science.  If your product sucks or doesn’t make sense or whatever, the idea is to catch it before it gets sold.  This is not at all like anything in the capitalistic marketplace.  Imagine if you send all your competitors your product and had them test them out before you sold it?  That’s just not going to happen.  That is a strong form of self-regulation.  It’s certainly not perfect, as scientists too can get into groupthink and convince themselves of things that are wrong or ignore possibilities because they go against the currently accepted paradigm, but it’s certainly better than not having peer review at all, I think.  Maybe there’s a better system, but this is what we have for now.

I am a scientist at heart.  I have a deep love of science in me.  But you know what?  I realize that it ain’t perfect and it never will be because it is a human endeavor.  The capitalism lovers don’t even seem to realize that capitalism won’t be perfect and people will be hurt in the process.  At least science, for the most part, has universal goals that I think are good, though the results of science can lead to stuff like atomic bombs and other sketchy, not so good for humanity things.  But those are more like applications, the search for scientific truth is, in my opinion, a noble human endeavor.  But fundamentally, I know that we need to keep regulating the market of scientific ideas, and may even need to develop better methods of self-regulation.  And there will still be mistakes.  Fraud still happens now sometimes, but when it’s discovered it is dealt with swiftly.  I feel like, as much as I love and respect science, I also recognize its faults and realize it is inherently flawed because it is a human endeavor and humans are not perfect!  Seriously, we are idiots at times.  So why do the laizzes faire capitalism people seem to think that their system, with even less strong incentives to act morally, is above human idiocy?  I’m not saying we should regulate to the degree we currently do, just that to me, believing with all your heart that regulation is evil and makes things worse just seems like another psuedo-religious belief system to me.  And I’m just not that gung-ho, sorry AnarchoCapitalism/Libertarianism.  As much freedom as we can have is AWESOME, but not at the expense of needless human suffering if we can prevent it with some amount of regulation.

A major problem I see with regulation is that it happens at the government level and in my country, the USA, we have decided that money is speech and thus corporations and other monied interests have bought our “democrazy”.  Can public funding of elections end this for good or will those with power always grasp for more in an immoral fashion for their own benefit, or towards their own goals that may not be what is best for the country and its citizens?  That is a very good question.  But we may never find out because the people with the money really don’t want us to so they won’t be supporting any candidates who make this their main issues  and the people in my country don’t seem to realize that is actually THE MOST IMPORTANT ISSUE IN POLITICS.  Until we make our politicians work for us again, how can we trust that anything they do is for us and not those who will help them get re-elected by ponying up the big $?  Even good ideas are corrupted by lobbying and campaign donations.  I really think this is the one issue that both sides of the political spectrum ought to be able to agree on.  But will we ever actually do something about it?

Final note:

By the way, if you’re a die hard Objectivist/AnCap and you tell me “the non-aggression principle implies the state is evil” I’m going to laugh at you.  I’ve heard that simplistic argument before directly from the guy who isolates his cult victims from outside ideas using that argument and emotional programming to fear statists as holding a gun to their heads;  I realize how appealing it is, but I just don’t really buy into it.  Being a scientist, I care more about real world results than having a cute little logical-sounding simplistic theory for everything.  Guess what, Newton’s laws are pretty cool too, but they don’t actually describe reality on the quantum level.  I know there are cute little just-so stories for how x, y, z would work out so much better in your AnCap Utopia, but seriously, if you’re wrong and it doesn’t work out very well and leads to a vastly larger amount of human suffering and misery, will you still stand by that argument and your theories for how everything is going to be so much better?  I just can’t believe an untested theory with all my heart the way some people seem to be able to.  AnCap is the string theory of political theories.  These guys sit around and mentally masturbate over how these things are all gonna work so much better in their AnCap utopian civilization, without any means of testing their theories with a great amount of risk to human beings.  Cool, that’s cute, keep thinking about that, but if you call me evil for not dedicating my life to an untested theory, you’re just being silly.  Stop please.

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  1. Muckypup Muckypup

    SMH! Shaking my head friend. I have to say, I love your writing so keep it up. However, I know you respect comments, even one’s in disagreement, so I will share my thoughts.

    Laissez Faire Capitalism is not well defined by you so I have some historical base to start from. It was a term started during the days of mercantalism and monarchs. The ruler of France at the time needed more money for the coffers. When the merchants were asked what could he do to help them make more money to fill the coffers. They said “laissez faire” or stay out of our way. It by no means is taken as lawlessness and immorality. It has more to do about, you be king or the politician and let me be the merchant or businessman. It was a call for separation of scope which I think most independent minded people accept as a reasonable request. It was an attempt at a modern implementation of division of labor. The merchants did not ask the king to not protect them or not to build warships and not to run the country. They just wanted the monarchs to stay out of trade deals and the market. That’s of course if the Monarch wanted their coffers filled. I hope that puts into context what is meant by laissez faire capitalism, it is not some kind of Hobbesian economy of dog eat dog. Having said that, I was intrigued how you were going to link it to science and I was not disappointed but first I’ll tackle anarchy since that was the next paragraph.

    Anarchy is a state of no government but not no laws. Which is why you have a wide range of anarchist movements from the left and right spectrum of politics. They don’t agree on the method of law enforcement but they do agree they don’t want to be told what to do by someone they find to be illegitimate. So I would not lump them as lawless as you stated but rather unforced. I also agree that yes, even anarchists have hierarchies and political structures. However, I think the difference is they accept authority voluntarily. Which opens up the door to manipulation etc but that is out of scope for this.

    Now for science and human behavior. You spoke about the motivations of scientists, I wouldn’t know what motivates them all and my question is, does it matter? In your example about fraud. I find fault because I think scientists are as much fallible as businesses. How do you judge Edison? He was a scientist. I would say JP Morgan was the businessman and not Edison yet Edison sought to crush Tesla. For JP, it might have been money but for Edison, it was his ego. My point being that you cannot remove the human from the equation, which is what you said but then for some reason appeared to put up an immunity bubble around science. I think science has the same faults as business.

    You explained the method of science called peer reviewed as a form as self regulation. I think businesses very much do the same. They have them all year around, called expos. Vendors are there to meet other vendors, the fact they let onlookers attend is no different than a scientist making their research public. It is for anyone, but the target is their own peers. Plus businesses do have marketing departments that are not only about advertisements but also about product review. So I find science and business very similar in the review process.

    “I’m just not that gung-ho, sorry AnarchoCapitalism/Libertarianism” I agree with this, but for different reasons. You talk about the noble deeds of science being rooted in “universal goals”. I’m not sure what that universal goal is so it cannot be that universal. If it is the search for truth then I think you moved into philosophy. I do agree with your earlier statement that science is about the how. The how has some importance must mostly for market reasons such as duplication of results. I mean really, is a scientist going to believe anything I put on paper if it cannot replicated? Well the minute they try to replicate it, I have engaged in the market of selling my idea. Not for money, but for influence, respect and for many ego. I’ll ignore the capitalism comment because it is mischaracterized and outside the scope of this review. I’ll only say that capitalism is not about a desired outcome which is eluded to as bad, it is instead a system to trade value for value.

    I’m with you all the way of the problems with government regulation and public funding. I think it is important to realize the regulations are pre-crimes and laws are post crimes. Capitalists believe in laws and not regulations. If I hurt someone, that’s a crime, if I haven’t hurt anyone but you still arrest me, that is a regulation. Secondly I think public funding of campaigns is only good in that it is just. Justice is important in any society. From a capitalist standpoint, the TV channels, radio channels and other media are granted monopolies. In return they should give each candidate a slot of time and that’s all the candidate can have. With technology it will get delivered and recorded for all to see. They could even legislate that each American mailing address receives a standard formatted mailer of each candidate that they created. There should be no party affiliations either. One can dream right!

    You know that Objectivists are not ancaps? They are actually philosophically opposed. Objectivists believe in strong and stable governments because Objectivists put ethics before politics philosophically. Other philosophies put politics before ethics and think society controls the actions of people and not the other way around. Which is why you see so many political philosophies flying around but are devoid of ethics. Objectivists are not pacifists and are instead about justice which is closer to the “eye for an eye” type of thinking. Punch me and I’ll punch you back. Make a life of hurting me and you’ll cease to have a life. However, on ancaps, I love the mental masturbation theory. It is so true, however, I think they pose less harm as individuals than religious and state sponsored zealots. I would never force you to be an ANCAP…lol!

    I so very much enjoy your writing and putting yourself out there. Your addition of the science perspective is awesome and keep it up. You are obviously intelligent in more ways than just physics.

    • Skeptic at Heart Skeptic at Heart

      Yeah, when I wrote this original essay it was a long time ago so I didn’t have the oh so intimate knowledge of AnCap and libertarianism that my ex banged into my head!

      Interestingly, I recently discovered the field of Psychology is a sham of a science. Firstly, read my post on Lee Jussim’s book. Then read this. Then laugh at Psychology. NOT SCIENCE!!! I should post that on Facebook and tag and tease my psychology PhD sister 😛

      I guess I think the main problems I have with unregulated capitalism are from the tragedy of the commons situations. An example, I spoke with a hydraulic engineer about fracking, because you hear all the hippy no fracking stuff, but I wanted to know an unbiased, data-driven perspective. He said it can be done environmentally safe, but the companies who started it did not do that. So now we are regulating it. They are post crimes usually because, unless they are a regulation being made for business by business (I know there are a lot of those), then it was probably because someone got hurt or got their water poisoned whatever and then they decided to prevent that from happening again. If business doesn’t want to be regulated, they should not let that kinda stuff happen. An ounce of prevention is worth a pound of cure. Dude. It’s like scientists who know when they do science fraud that if they get caught (and they will eventually) that they will lose their entire reputation and never ever ever be able to publish again. Whereas, companies spill oil in the ocean and then keep doing their business. The incentives to ostracize and destroy them are lower, or maybe it’s because they own the government? Who knows?

      Here’s my suggestion. We can, tomorrow, wipe the slate and clear out all the regulations. Then, only add them when a minimum number of citizens gets hurt due to business being careless. We’ll only put the regulation on the specific company that harmed people, so the incentives are good for each company to do it’s best to prevent harming people. Are we agreed? Now we just have to convince someone who actually has any political power. It’s an agreement on business’s part to not be douches in exchange for not being regulated. Do you think they can actually do that? How long before we have our first need for regulation? We’d have to first get the $ out of politics of course, or this wouldn’t happen.

      YES FUCK POLITICAL PARTIES!!!! They drive me batshit. They just get people in groupthink/tribal mode. Bad bad bad.

      Does brainwashing count as being forced to be an AnCap? Stef and my ex tried 😛

  2. Leo Leo

    The problem runs much much deeper. How can we describe financial systems? Turns out, you can do that fairly easily, but the results are surprising. Keen gives a good presentation on modeling.

    • Skeptic at Heart Skeptic at Heart

      I’ll watch it, thanks! I think anything involving humans is even more complex than climate, therefore I don’t really believe much of what they say, either. When you have experts saying opposite things and vehemently disagreeing in a field, it seems that it doesn’t have a consensus, so it just seems like there’s probably some bias in different people’s brain that makes them process the same data differently. Or emphasize different data. And yet no one wants to admit they are biased, yet we are all biased. Homo sapiens is a funny species.

      Mostly I was amused when I found this essay I wrote in my google docs awhile ago, since I wrote it way way way before FDR when I was annoyed with a libertarian Facebook friend of mine who suggested that we privatize air to solve air pollution. No shit. He actually said that. Or maybe it was more like “we have to figure out a way to privatize air”.

  3. Just a smiling visitor here to share the love (:, btw great layout.

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