Institutions

The Mechanics of the Minimum Wage [Video]

by Alex Merced

Often times when you try to create protections or regulations of the market, the result is to create an undue burden on those least able to bear them. The result is those at the very bottom can seem stuck there, and those who are somewhat to very well off find themselves relieved of a lot of competition, allowing them to take a bigger participation in the ever changing economic pie. The minimum wage is one of the policies that have these results. Although due to the amount of labor that may already be working at bottom of the income ladder can be limited, the result of this policy for good or worse can be hard to truly measured or seen. Yet, understanding the impacts of market intervention on economic disparities and in turn economic tolerance needs to be more part of the economic discussion.

The Law, Legislation, and Tolerance

by Alex Merced

As mentioned by George Mason University economist Don Boudreux, F.A. Hayek had important insights into society’s institutional behavior in his distinction between the Law and Legislation.The distinction being that legislation are rules formally instituted by a legislative body (think government) and laws are the rules we universally and informally follow.

Driving home the distinction:

– It is legislation that prohibits the sale and use of marijuana in the United States, but it’s not necessarily a piece of legislation people follow strictly because this has weakened over time as social law.

– While there is no explicit rule to not cut people in line, we all know not to and generally don’t. This would be an example of a social law.

Often times legislation is guided by law, because legislation that runs contrary to the societal laws of the time will often be difficult to pass, much less enforce, without political consequences. From a libertarian standpoint, this creates several implications that libertarians should concern themselves with.

1. Societal Law can be a barrier to Coercive Legislation: While politics is not really an ideological sphere of society (politicians use ideology to gain power successfully more so  than ideologues use politicians to shape society successfully). So if libertarians are concerned with the size of government and equality under the law (meaning legislation that does create arbitrary societal divides), then the societal law (culture, norms, ethics etc) should hold these things in high regards so that legislation that runs counter to these goals finds it difficult to exist or be enforced. Luckily, the United States has a deep historical culture of inclusiveness (melting pot), skepticism of central rule (revolutionary war, Nixon Scandals, NSA), and celebration of individual achievement (when we think of Steve Jobs, Bill Gates, and other entrepreneurs, we think of their individual achievement first, and barely, if ever, think of any indirect or direct government involvement in their enterprises). So the United States societal law has always been primed to keep certain lines difficult to cross more so than other nations (not that they haven’t been crossed, or that these barriers haven’t weakened at all).

2. Not participating in shaping societal law can make the fight against coercive legislation an uphill battle: If we don’t, through cultural transmission channels like family (how many laws/manners did you learn from your parents), media (how much did you learn from certain TV shows and movies), and the education system, attempt to make or keep things like property rights, non-aggression, and appreciation/tolerance of the individual part of societal law we will find legislation drifting further into larger violations of these values that libertarians hold dear.

So, distinguishing the external forces that shape our behavior and choices into law and legislation can be a very useful tool in solving the types of problems and issues us libertarians concern ourselves with. Another useful taxonomy is that of Institutions and Organizations from economist Douglass C. North. In this breakdown, institutions are the formal and informal human constructs that we allow to limit our behavior (legislation, laws, etc.) and Organizations are the hierarchies of how individuals organize to accomplish a shared goal. So if we look at a university, the distinction between the organization (the president, faculty, and their powers) and the institution (the formal school rules and informal traditions that have developed) can be broken down to help understand the social dynamics.

Libertarians making an effort to use these types of insights to improve and strengthen our understanding of society within the framework of Libertarian philosophy present a great opportunity to push forward the importance and argument for our cause.

A Landscape of Liberty Friendly Institutions

by Alex Merced

In every libertarian evolution, we go through a lot of different phases as we discover our core convictions and views. At different points in my ideological journey I’ve identified with labels such as classical liberal, conservative, minarchist, and anarcho-capitalist, and then I got to the point where I stopped worrying about all these nuances and labels and just said, “I’m a libertarian concerned more with promoting libertarian thought and libertarian means than focusing on any particular ideal power structure.” (Is there any ideal anything? If there was, would it always remain ideal?) At the end of the day, looking at issues from the perspective of, “Is there government intervention (bad), or not (good),” while totally agreeable in its implications, I feel it overlooks a great point. It’s a point which I think many more cutting edge libertarian philosophers and economists are starting to see. Our individual lives and ability to make choices regarding that life, and the property we’ve accumulated in that life, are affected by much more than just government. Institutions such as family, religion, etc. all play a role in our ability to make choices regarding our lives, property, and ability to pursue happiness. Appreciating this reality doesn’t imply any consent for the use of force, instead it just recognizes another dimension of the battle for liberty.

This dimension is molding institutions (social norms, laws, family, etc.) in ways that are conducive to a  view that respects an ability for an individual to make choices about their life and property.  This goal does not need force, but instead participation in social discourse through participation in these institutions so they can be reformed from the inside, through education, so others may make voluntary choices that reform these institutions, and through research so that we can learn more about how these institutions can be improved. (Are there better governance or management systems we can voluntarily adopt? What dynamics make successful families work that other families can adopt?)

In helping understand what reforms and institutions are liberty friendly, I’ve defined four characteristics of institutions that are liberty friendly and liberty hostile (notice how government often encompasses many of these features in the latter category):

Open (Friendly) vs. Closed (hostile): an open institution has very low barriers to participation. Due to this, the market/choice mechanism allows the institution to evolve. A closed institution has high barriers to entry which limits participation, giving the participants an over sized share of power in the institution which they often use to keep others out, slowing down its ability to evolve with other institutions.

Dynamic (Friendly) vs. Static (hostile): a dynamic institution has the flexibility to evolve with changing situations and circumstances while a static institution does not. This eventually will lead to its fighting liberty to protect itself from becoming obsolete.

Transparent (friendly) vs. Opaque (hostile): An institution that is transparent and allows a more free flow of information will enable people to make better choices. While an opaque institution hides information, often not allowing individuals to make proper assessments and choices of different situations (think the NSA).

Voluntary (Friendly) vs. Compulsory (hostile): A voluntary institution has a better feedback mechanism in peoples choices to determine if it’s providing value. A compulsory does not have this mechanism at all, which often leads to the development of the other three hostile characteristics.

So, to make the world more liberty friendly, as libertarians we should discuss how to make institutions more libertarian friendly and take the appropriate non-coercive methods to achieve these reforms.

Libertarians Should Lead the Way for Transgender Acceptance

by Alex Merced

Libertarianism is often well known for its concerns over the use of government power in solving economic and social issues, primarily because such power often attracts the wrong people to wield it and can often do more harm than good (a government that is powerful enough to establish and enforce hate crime legislation is also a government strong enough to establish and enforce the fugitive slave act.) So when it comes to issues of tolerance, you won’t find a philosophy more celebratory of diversity and tolerance (a free market works because of a diversity of goods, services, firms, and individuals) but often lambasted for its refusal to cross the line of using government power to compel tolerance or intolerance (or compel anything in that matter).

Although, just because libertarians do not want to use government power to force social progress, it doesn’t mean libertarians shouldn’t express social values and engage in the discussion of social norms. Over time, social attitudes have changed to more tolerant ones. Tolerant in a greater way than just “I don’t mind those people” but extending to being able to share space and participation in social institutions such as entrepreneurship, leisure, and family. In the generation prior to mine this battle over tolerance was focused here in the U.S. over tensions between the African American and White populations, and in my generation it has been about tensions between homosexual and heterosexual populations. These days it’s not just that there is tolerance for African Americans and Homosexuals but widespread acceptance of their participation as business owners, as co-workers, consumers, and as part of household formation.

The struggle for tolerance and acceptance in the coming generation will have a lot to do with gender identity. We are currently witnessing controversy over how to handle bathrooms for transgender students, and physical assaults against them in photos on instagram or video on YouTube. While the transgender population has enjoyed an increase in tolerance along with homosexuals (the two populations are not the same despite often being lumped in the same category) acceptance of the transgender population still has a long way to go.

Now, tolerance and acceptance is not just about feeling good that peoples lives are a little bit better. It serves an economic and social function as well. A broader participation in economic institutions such as entrepreneurship benefits everyone, adding people to the labor force benefits everyone, but sometimes intolerance and a lack of acceptance can reduce participation in these institutions.

So how can libertarians improve tolerance & acceptance of Transgendered and other populations suffering intolerance at no fault of their own without the use of government force?

– Media: Shows like Cosby, Will & Grace, and other introduced these populations in a broader way not as a spectacle but as people with their own lives, challenges, and families. How about a sitcom with a transgender protagonist facing many of the same family issues we all do? The images we grow up with in our culture determine many of our sensibilities, so we should use this to our advantage. Transgender characters often do exist in media but often as a “spectacle” in roles that societies “allow” to be accepted (hairdresser, model, prostitute) but where is the transgender business owner or engineer (they do exist) in the public eye?
*The character of Sophia Burset in Orange is the new Black is by far the boldest transgender character on tv with complex family and health issues that make her interesting, although she is often found doing hair, thus keeping transgender activities in a narrow band.

– Support: Sometimes it’s just about breaking vicious cycles, many young children who open up to their parents are often cast out and forced to be runaways. Being ripped away from the support system of the family affects their ability to get educated and to later be able to participate in the traditional labor force. Fundraising and volunteering for shelters and education for runaway youth can help break the cycle.

Conclusion

While empowering government to solve social problems will often result in empowering them to create social problems, libertarians should not allow big government progressives to attempt to hold a monopoly on the fight for broader tolerance and acceptance of individuals of all types. We should come with a message not just more tolerance for a particular community, but that we want to include everyone in the greater community of individuals who can participate in social and economic institutions to all our benefit. We must make real front line efforts to advance these values through education and volunteering, and help craft the norms that make society wealthier economically and socially.