Buffett: Raise Taxes on ‘Coddled’ Billionaires

[Darth Wong]

Economists clearly have a queer definition of efficiency if that's the case. In any other context, particularly all the sciences and engineering disciplines, efficiency=output/input. This could also be expressed as (output+waste)/(input)=1.

[Lord Zentei]

It is meant to be seen from the point of view of the total economy, as opposed to the point of view of the individual consumer. It also depends on the "input" in the relation you cite as being the cost of the units going into the production, as opposed to how much people pay for the product.

Assuming that you have a situation which is economically efficient, you have maximized the outputs for the given amount of inputs, as opposed to maximizing the outputs for the price of the outputs. If the whole economy is economically efficient, this holds for all final goods that are produced.

[K. A. Pital]

@Surlethe
Nitpick: the free market removes shortages which is defined as the difference between the amount of a good people willing to pay for at a given price minus the amount people are willing to sell at a given price.

The market removes shortages by making some people outpriced. If none were outpriced, shortages would undeniably occur, especially with what concerns healthcare. The market also prioritizes on rewarding people that can pay with an access to a service (which is healthcare, for example), there are no other criteria than the ability to pay or, in econ-speak, having effective demand.

The American healthcare system with all its complexities is very likely such a market.

It is Pareto-efficient or at least close to that. Taking from any one actor is the only way you could make another actor in the same healthcare market better off. Pareto efficiency has no moral criteria to provide one set of agents over another set of agents (i.e. the sick over the doctors, in a very simple combination).

I haven't read the NEMJ study, but I suspect that they're using the term "efficiency" in one or more of the three ways I mentioned above, as opposed to using economic efficiency.

I don't think people use Pareto efficiency to evaluate the healthcare market performance anyway. Pareto is simply a state which is achieved when productive capacity is used to the full and everything that is produced is then distributed so that no one can take any more; it does not speak anything about any other moral or whatever dimensions of efficiency of distribution at all.

[Lord Zentei]

@Surlethe
Nitpick: the free market removes shortages which is defined as the difference between the amount of a good people willing to pay for at a given price minus the amount people are willing to sell at a given price.

The market removes shortages by making some people outpriced. If none were outpriced, shortages would undeniably occur, especially with what concerns healthcare. The market also prioritizes on rewarding people that can pay with an access to a service (which is healthcare, for example), there are no other criteria than the ability to pay or, in econ-speak, having effective demand.

Naturally it does that. The concept of shortages is only meaningful in economics if you define it in terms of some price, otherwise, it becomes the concept of scarcity. But in fairness, I did specify "at a given price" in my explanation of it.

The American healthcare system with all its complexities is very likely such a market.

It is Pareto-efficient or at least close to that. Taking from any one actor is the only way you could make another actor in the same healthcare market better off. Pareto efficiency has no moral criteria to provide one set of agents over another set of agents (i.e. the sick over the doctors, in a very simple combination).

Actually, insurance companies cannot freely sell policies across state lines in the US, and there are areas that have limited competition, so I doubt that it's all that efficient. That's not counting the subsidies and the recent Obamacare bill which requires people to purchase insurance from said inefficient market - an absurd thing in and of itself.

I haven't read the NEMJ study, but I suspect that they're using the term "efficiency" in one or more of the three ways I mentioned above, as opposed to using economic efficiency.

I don't think people use Pareto efficiency to evaluate the healthcare market performance anyway. Pareto is simply a state which is achieved when productive capacity is used to the full and everything that is produced is then distributed so that no one can take any more; it does not speak anything about any other moral or whatever dimensions of efficiency of distribution at all.

Indeed, and for that reason I happen to be pro-welfare. Though to be fair, the price society pays for something should be taken into consideration when deciding whether a situation is moral or not, and it does matter that someone is paying for the benefits of another. It's certainly not the only criteria, just an important one.

[Simon_Jester]

It is meant to be seen from the point of view of the total economy, as opposed to the point of view of the individual consumer. It also depends on the "input" in the relation you cite as being the cost of the units going into the production, as opposed to how much people pay for the product.

Assuming that you have a situation which is economically efficient, you have maximized the outputs for the given amount of inputs, as opposed to maximizing the outputs for the price of the outputs. If the whole economy is economically efficient, this holds for all final goods that are produced.

This kind of definition of 'efficiency' undermines the ability of economics to work as an applicable discipline. If an economist assures the government, or the citizenry, that a system is "efficient" when it does not provide good return on resources put into the system, or when it fails to distribute essential goods... well, one has to ask whether the economist's assurances are worth anything. What good is it to have an "efficient" system for distributing clothing if people are going naked?

At that point, "efficiency" becomes a technical term only- and an irrelevant one, because the efficiency of the system loses contact with the parameters that matter to the people on the ground.

[K. A. Pital]

Naturally it does that. The concept of shortages is only meaningful in economics if you define it in terms of some price, otherwise, it becomes the concept of scarcity. But in fairness, I did specify "at a given price" in my explanation of it.

Yeah, I understand. Sometimes I want to make sure people understand that there's no "shortage" of a good simply because not everyone can get it - the market does not create some sort of abundance. Instead it masks the ever-present input and thus also output scarcity in the prices, which act as natural barriers that disallow any visible deficit from arising. The scarcity and deficit then manifest themselves in the very existence of dispossessed and thus non-bidders for a particular price, not in a lack of some particular good on the market at a given time.

Actually, insurance companies cannot freely sell policies across state lines in the US, and there are areas that have limited competition, so I doubt that it's all that efficient. That's not counting the subsidies and the recent Obamacare bill which requires people to purchase insurance from said inefficient market - an absurd thing in and of itself.

You could create perfect competition in the insurance market, but if the optimization or maximization price (depending on which theory of profit you subscribe to) is high, a lot of people will be outpriced. The barriers may hold the insurance system one or two steps away from that state, but it doesn't mean this final state is even desireable in the first place.

Indeed, and for that reason I happen to be pro-welfare. Though to be fair, the price society pays for something should be taken into consideration when deciding whether a situation is moral or not, and it does matter that someone is paying for the benefits of another. It's certainly not the only criteria, just an important one.

Part of the problem is that "someone" can be a body corporate with enormous sums of money and, dare I say, even overgenerous pay to workers who are in no threat of privation at all. Economics do not even distinguish bodies corporate or individuals; they are property holders, and a body corporate has the same property rights and leverage-according-to-price as an individual does. This can create a lot of collusions, and in practice it does. In theory, it does not matter whether we're talking about an individual or a company, after all both are merely economic actors. In practice, individuals have biological needs which are a factor of counter-elasticity (creating inelastic demand for these goods). Bodies corporate do not, and organizations also usually have more funds simply because they are organizations.

[Surlethe]

@Surlethe
Nitpick: the free market removes shortages which is defined as the difference between the amount of a good people willing to pay for at a given price minus the amount people are willing to sell at a given price. Scarcity is the reality that resources are not infinite, or at least that there's a difference between the amount people might conceivably want and the amount they can actually get. Nothing can remove scarcity other than, perhaps, both zero-cost production and distribution combined with zero entry costs and zero transaction costs.

Well yes, I do know this. I'm making the point that when the Right makes scary noises about socialized health care, it invariably includes pointing out that other countries have lions and tigers and waiting lines to ration care, oh my! They often conveniently forget the fact that health care is a scarce resource that has to be rationed somehow, and that the debate between various systems of organizing the health care market is actually about how we as a society want that rationing to proceed.

But economic efficiency is a concept that is often misused by both critics and supporters of the market approach to resource distribution. It is meant to optimize an economy in terms of production costs, NOT in terms of market price (although the market price of inputs and outputs is the driving mechanism). One measure of economic efficiency is Pareto-efficiency - i.e. that it is not possible to make anyone better off without reducing someone else's welfare. In particular, economic efficiency implies that the market optimizes the total benefit, i.e. the sum of all consumer benefit PLUS the sum of all producer's profit. The consumer benefit is defined as the difference between the maximum price the consumer is willing to pay and the price he has to pay, just as producer's profit is the difference between the selling price and the production costs. Of course, not all markets reach this ideal due to sundry factors such as imperfect information and government interventions (not all of which are made for the benefit of the consumer). The American healthcare system with all its complexities is very likely such a market.

Mind, there are problems with measuring social welfare in terms of consumer surplus. This assumes that utility is proportional to ability to pay, for instance. It is easy to construct counterexamples where a free food market actually kills people, and only slightly more difficult to find historical examples (Irish potato famine, during which Ireland was actually a net food exporter). That sort of outcome violates moral intuitions, so it casts doubt on the indiscriminate use of consumer surplus as a measure of a market's net welfare contribution to society.

[Surlethe]

I believe one can formulate a Pareto-efficient criterion for any given utility function on each individual, but I cannot say for certain.

One should think of economic efficiency in the utilitarian sense: does a particular distribution of goods and services maximize social welfare? If not, some way might be found to alter the distribution to increase social welfare. (Problem: the computation becomes intractable quickly, and is impossible from first principles in a society of hundreds of millions of people distributing trillions upon trillions of dollars' worth of goods and services. Then you have to ask: does performing approximate computations, plus implementing the redistribution, have significant cost? But that's a practical question, not terribly relevant to the idea of efficiency = maximal utility in the first place.)

[Lord Zentei]

Naturally it does that. The concept of shortages is only meaningful in economics if you define it in terms of some price, otherwise, it becomes the concept of scarcity. But in fairness, I did specify "at a given price" in my explanation of it.

Yeah, I understand. Sometimes I want to make sure people understand that there's no "shortage" of a good simply because not everyone can get it - the market does not create some sort of abundance. Instead it masks the ever-present input and thus also output scarcity in the prices, which act as natural barriers that disallow any visible deficit from arising. The scarcity and deficit then manifest themselves in the very existence of dispossessed and thus non-bidders for a particular price, not in a lack of some particular good on the market at a given time.

I'm afraid that I must object to the terms in which you're describing this. There is of course no system which totally eliminates scarcity, but the market does not "mask" anything. This is simply the resource allocation protocol that the market uses. Moreover, a competitive market does strive to maximize the units of production for X units of input, so while it doesn't create abundance, it does minimize limitation faced by the aggregate (though not so much for every individual within the aggregate). Nor are those who can't afford something "dispossessed", since their possessions were not taken from them. They're simply not enriched.

Actually, insurance companies cannot freely sell policies across state lines in the US, and there are areas that have limited competition, so I doubt that it's all that efficient. That's not counting the subsidies and the recent Obamacare bill which requires people to purchase insurance from said inefficient market - an absurd thing in and of itself.

You could create perfect competition in the insurance market, but if the optimization or maximization price (depending on which theory of profit you subscribe to) is high, a lot of people will be outpriced. The barriers may hold the insurance system one or two steps away from that state, but it doesn't mean this final state is even desireable in the first place.[/quote]

A lot of people are facing too high costs already. But the current scheme creates regional monopolists or at least greatly limits competition regionally, and that's certainly not for the benefit of the consumer. Of course, the insurance companies and their lobbyists are powerful in Washington DC, so obviously the current inefficiencies favour them, not the general public.

Indeed, and for that reason I happen to be pro-welfare. Though to be fair, the price society pays for something should be taken into consideration when deciding whether a situation is moral or not, and it does matter that someone is paying for the benefits of another. It's certainly not the only criteria, just an important one.

Part of the problem is that "someone" can be a body corporate with enormous sums of money and, dare I say, even overgenerous pay to workers who are in no threat of privation at all. Economics do not even distinguish bodies corporate or individuals; they are property holders, and a body corporate has the same property rights and leverage-according-to-price as an individual does. This can create a lot of collusions, and in practice it does. In theory, it does not matter whether we're talking about an individual or a company, after all both are merely economic actors. In practice, individuals have biological needs which are a factor of counter-elasticity (creating inelastic demand for these goods). Bodies corporate do not, and organizations also usually have more funds simply because they are organizations.

Collusions? You mean mergers?

Personally, I don't mind that corporations have large amounts of money. But I do mind quite a bit when they gain their money by rigging the system. BTW: companies can face inelastic demand if they're producing things with highly specialized inputs. Neither does inelastic demand mean that the market can't serve the general public - consumer goods are bought and sold in a competitive market.

[Lord Zentei]

This kind of definition of 'efficiency' undermines the ability of economics to work as an applicable discipline. If an economist assures the government, or the citizenry, that a system is "efficient" when it does not provide good return on resources put into the system, or when it fails to distribute essential goods... well, one has to ask whether the economist's assurances are worth anything. What good is it to have an "efficient" system for distributing clothing if people are going naked?

At that point, "efficiency" becomes a technical term only- and an irrelevant one, because the efficiency of the system loses contact with the parameters that matter to the people on the ground.

It does measure what gives a good return on the resources put into the system, that's the whole point. But it's the entire economy that places resources into the system, not the individual consumer. As I pointed out, it's not the only criterion people should use, but it's an important one.

Well yes, I do know this. I'm making the point that when the Right makes scary noises about socialized health care, it invariably includes pointing out that other countries have lions and tigers and waiting lines to ration care, oh my! They often conveniently forget the fact that health care is a scarce resource that has to be rationed somehow, and that the debate between various systems of organizing the health care market is actually about how we as a society want that rationing to proceed.

Well, that's fair enough.

Mind, there are problems with measuring social welfare in terms of consumer surplus. This assumes that utility is proportional to ability to pay, for instance. It is easy to construct counterexamples where a free food market actually kills people, and only slightly more difficult to find historical examples (Irish potato famine, during which Ireland was actually a net food exporter). That sort of outcome violates moral intuitions, so it casts doubt on the indiscriminate use of consumer surplus as a measure of a market's net welfare contribution to society.

It assumes that the utility is proportional to willingness to pay.

I don't think anyone believes that it's a perfect measure, but it's less bad than many measures of social welfare. It's not to be used as the only measure, obviously.

I believe one can formulate a Pareto-efficient criterion for any given utility function on each individual, but I cannot say for certain.

One should think of economic efficiency in the utilitarian sense: does a particular distribution of goods and services maximize social welfare? If not, some way might be found to alter the distribution to increase social welfare. (Problem: the computation becomes intractable quickly, and is impossible from first principles in a society of hundreds of millions of people distributing trillions upon trillions of dollars' worth of goods and services. Then you have to ask: does performing approximate computations, plus implementing the redistribution, have significant cost? But that's a practical question, not terribly relevant to the idea of efficiency = maximal utility in the first place.)

This intractability is precisely why command economies tend to fare poorly. Better to distribute the decision-making process.

[Surlethe]

It assumes that the utility is proportional to willingness to pay. Nonetheless, it's less bad than many measures of social welfare. It's not to be used as the only measure, obviously.

True. That's where many libertarians get bogged down, I think. The assumption is that utility is totally relative, no one person can have any idea what everybody else in society values, so the only way to assure optimal distribution is through markets. This is obviously false when it comes to, say, the health care market, where one may safely assume almost everybody places pretty much equal value on not dying.

(In other markets it strikes me as much more difficult to measure utility, so I'm usually content to let the market perform as long as there's some healthy income redistribution going on (Friedman's negative income tax, anyone?) and externalities are healthily controlled.)

Edit:

This intractability is precisely why command economies tend to fare poorly. Better to distribute the decision-making process.

Yes, I know, but I didn't want to provoke Stas in this thread

[Simon_Jester]

This kind of definition of 'efficiency' undermines the ability of economics to work as an applicable discipline. If an economist assures the government, or the citizenry, that a system is "efficient" when it does not provide good return on resources put into the system, or when it fails to distribute essential goods... well, one has to ask whether the economist's assurances are worth anything. What good is it to have an "efficient" system for distributing clothing if people are going naked?

At that point, "efficiency" becomes a technical term only- and an irrelevant one, because the efficiency of the system loses contact with the parameters that matter to the people on the ground.

It does measure what gives a good return on the resources put into the system, that's the whole point. But it's the entire economy that places resources into the system, not the individual consumer. As I pointed out, it's not the only criterion people should use, but it's an important one.

For the purpose of health care, per capita spending would seem to be a rather important criterion...

A system which is highly efficient while having exorbitant sums spent on it for poor outcomes is a sign of a bad system for measuring "efficiency."

This intractability is precisely why command economies tend to fare poorly. Better to distribute the decision-making process.

I think the fundamental problem of modern capitalism is that we're so afraid to violate the post-Cold War consensus that command economics is the ultimate evil that we lose perspective. The state is no longer 'allowed' to step back and say "this is bloody stupid, time to reboot the market from backup and try a different regulatory regime."

Make of that what you will, but I think it's a problem that any strongly pro-market political philosophy needs a means to address. Where do you draw the "this is bloody stupid" line?

[K. A. Pital]

Yes, I know, but I didn't want to provoke Stas in this thread

Come on! I'm not that easily provoked!

There is of course no system which totally eliminates scarcity, but the market does not "mask" anything.

Inefficient demand is masked. You don't see and you cannot estimate reliably the number of people who want to access a good but cannot, since they are outpriced. You can only gouge inefficient demand by side indicators. Like, if people are being outpriced during a famine, you can see the volume of ineffective demand by counting the bodies. In cases not so macabre, estimating just how many people forgo their needs or even biological needs is jolly hard, if they can't buy the good in question.

Of course, the insurance companies and their lobbyists are powerful in Washington DC, so obviously the current inefficiencies favour them, not the general public.

One could argue that this is a reward for them accumulating so much money. Power and special privileges are also a service, and a marketable one. Those who can pay for it, get it. Those who can't... tough luck

Personally, I don't mind that corporations have large amounts of money. But I do mind quite a bit when they gain their money by rigging the system. BTW: companies can face inelastic demand if they're producing things with highly specialized inputs. Neither does inelastic demand mean that the market can't serve the general public - consumer goods are bought and sold in a competitive market.

Yeah, but inelastic demand means that the needs can't be really downscaled. If you raise the price of food, people aren't going to buy less food but instead economize on other things. With obvious biological consequences, regardless of whether food price raises are acceptable from a POV of strict economics. As for corporations, see above. If we view every service as a marketable service and erect no artificial barriers, technically we run into the issue that corporations of a certain size can actually either buy barriers from the government, or (if government is not present) erect barriers themselves since they are the next biggest power after the government. There's absolutely no way around it - barriers mean greater profits and thus barriers are a highly valuable market service. Paradoxical as it is.

[Lord Zentei]

There is of course no system which totally eliminates scarcity, but the market does not "mask" anything.

Inefficient demand is masked. You don't see and you cannot estimate reliably the number of people who want to access a good but cannot, since they are outpriced. You can only gouge inefficient demand by side indicators. Like, if people are being outpriced during a famine, you can see the volume of ineffective demand by counting the bodies. In cases not so macabre, estimating just how many people forgo their needs or even biological needs is jolly hard, if they can't buy the good in question.

In the case where demand is inelastic, that's not strictly true. Moreover, elasticity can be measured, as can untapped markets.

Of course, the insurance companies and their lobbyists are powerful in Washington DC, so obviously the current inefficiencies favour them, not the general public.

One could argue that this is a reward for them accumulating so much money. Power and special privileges are also a service, and a marketable one. Those who can pay for it, get it. Those who can't... tough luck

No... just no. Bribing politicians to meddle with the regulatory framework is anathema to a free market, and to rule of law.

Personally, I don't mind that corporations have large amounts of money. But I do mind quite a bit when they gain their money by rigging the system. BTW: companies can face inelastic demand if they're producing things with highly specialized inputs. Neither does inelastic demand mean that the market can't serve the general public - consumer goods are bought and sold in a competitive market.

Yeah, but inelastic demand means that the needs can't be really downscaled. If you raise the price of food, people aren't going to buy less food but instead economize on other things. With obvious biological consequences, regardless of whether food price raises are acceptable from a POV of strict economics. As for corporations, see above. If we view every service as a marketable service and erect no artificial barriers, technically we run into the issue that corporations of a certain size can actually either buy barriers from the government, or (if government is not present) erect barriers themselves since they are the next biggest power after the government. There's absolutely no way around it - barriers mean greater profits and thus barriers are a highly valuable market service. Paradoxical as it is.

First point: obviously people economize when faced by high prices. I don't see why that's a particular weakness of the market system. As for the second point, when corporations bribe politicians to impose regulations which favour them specifically at the expense of both their prospective rivals and consumers, that is an artificial barrier. When they don't receive such protection, that is not an artificial barrier.

[K. A. Pital]

In the case where demand is inelastic, that's not strictly true. Moreover, elasticity can be measured, as can untapped markets.

You can measure "untapped markets", but the estimate is bound to be very rough one. Masking is the transformation of scarcity from a visible one (deficit) into an invisible one (outpriced people). In a situation where all 50 people have enough buying power to get Good A, but there's only 30 Good A, the first 30 bidders get Good A and 20 do without. In a situation where 30 people can buy Good A, but 20 cannot, the scarcity only manifests in the outpriced 20 people, because Good A's production and consumption is in an equilibrium. Yet the deficit is obvious, visible and easily counted as well (substract goods from number of consumers). The number of outpriced people is not obvious neither easily measured, because these people never even go to the store to attempt to buy the good. You can measure "potential markets" and "potential demand", et cetera, but the measurements are much harder to do.

No... just no. Bribing politicians to meddle with the regulatory framework is anathema to a free market, and to rule of law.

Um... why? Lobbying for business-friendly policies was important to actually create capitalism as it is. Companies constantly lobby laws that make their businesses more profitable. That has been a defining feature of capitalism. Rule of law is supposed to make life for the companies better, since they are the most powerful agents in the system. It is a natural process. For example, consider a company which lobbies against some feudal-era law, like a ban on female employment. It is a law, a legal one, in say Saudi Arabia. To transition into modern capitalism, this law has to be abolished. Same goes for everything else. I chose a positive example specifically to stress the point. The law cannot be static anyway, so what sort of "rule of law" are you upholding? What if a company lobbies against say, the Lex Volkswagen in Germany to destroy the barrier another company (Volkswagen) erected? How is that negative-lobbying act any different from Volkswagen lobbying a barrier for itself? It is not. They're fundamentally similar acts. Companies act only in their interest. Regardless of whether oligopoly, monopoly or perfect competition would be better for consumers, companies only consider themselves and their own profits first and foremost. It is a natural feature of capitalism. Trying to put bricks into that stream will just breed corruption and then you'll be lambasting corrupt politicos in the thread, not realizing that the system breeds them like flies.

First point: obviously people economize when faced by high prices. I don't see why that's a particular weakness of the market system.

Starving Bangladeshis would love to have a word with you. When food is a commodity and price can change even when food is effectively abundant, but hoarding provides greater benefits, it is obviously a weakness related to inelastic and biology-related demand.

As for the second point, when corporations bribe politicians to impose regulations which favour them specifically at the expense of both their prospective rivals and consumers, that is an artificial barrier. When they don't receive such protection, that is not an artificial barrier.

Why is something an "artificial" barrier? How is it different from a "natural" barrier? Because the corporation uses the government? Boohoo. What if a corporation buys PMCs to protect their territory from others - is that "erecting an artificial barrier" to entering their territory? What if they treat their market shares or profits just like said territory and what to hire PMCs to protect that?

[Surlethe]

First point: obviously people economize when faced by high prices. I don't see why that's a particular weakness of the market system.

Stas seems to be making the same point I made earlier about consumer surplus.

[Lord Zentei]

In the case where demand is inelastic, that's not strictly true. Moreover, elasticity can be measured, as can untapped markets.

You can measure "untapped markets", but the estimate is bound to be very rough one. Masking is the transformation of scarcity from a visible one (deficit) into an invisible one (outpriced people). In a situation where all 50 people have enough buying power to get Good A, but there's only 30 Good A, the first 30 bidders get Good A and 20 do without. In a situation where 30 people can buy Good A, but 20 cannot, the scarcity only manifests in the outpriced 20 people, because Good A's production and consumption is in an equilibrium. Yet the deficit is obvious, visible and easily counted as well (substract goods from number of consumers). The number of outpriced people is not obvious neither easily measured, because these people never even go to the store to attempt to buy the good. You can measure "potential markets" and "potential demand", et cetera, but the measurements are much harder to do.

You'd rather have shortages than people not purchasing goods? You're not optimizing production that way, nor are you helping anyone with getting resources that they otherwise wouldn't have, so what's the point? Besides, the number of people who would purchase a good at a lower price can be inferred in a fairly straightforward way by applying the elasticity of demand to the market price and quantity and shifting the supply curve to the new price, reading the new quantity directly from the Supply-Demand graph.

No... just no. Bribing politicians to meddle with the regulatory framework is anathema to a free market, and to rule of law.

Um... why? Lobbying for business-friendly policies was important to actually create capitalism as it is. Companies constantly lobby laws that make their businesses more profitable. That has been a defining feature of capitalism. Rule of law is supposed to make life for the companies better, since they are the most powerful agents in the system. It is a natural process. For example, consider a company which lobbies against some feudal-era law, like a ban on female employment. It is a law, a legal one, in say Saudi Arabia. To transition into modern capitalism, this law has to be abolished. Same goes for everything else. I chose a positive example specifically to stress the point. The law cannot be static anyway, so what sort of "rule of law" are you upholding? What if a company lobbies against say, the Lex Volkswagen in Germany to destroy the barrier another company (Volkswagen) erected? How is that negative-lobbying act any different from Volkswagen lobbying a barrier for itself? It is not. They're fundamentally similar acts. Companies act only in their interest. Regardless of whether oligopoly, monopoly or perfect competition would be better for consumers, companies only consider themselves and their own profits first and foremost. It is a natural feature of capitalism. Trying to put bricks into that stream will just breed corruption and then you'll be lambasting corrupt politicos in the thread, not realizing that the system breeds them like flies.

Surely you can see that there's a fundamental difference between creating regulation that fosters competition between producers and ensures that market practices are honoured on the one hand and regulation which inhibits competition and fosters cronyism on the other?

First point: obviously people economize when faced by high prices. I don't see why that's a particular weakness of the market system.

Starving Bangladeshis would love to have a word with you. When food is a commodity and price can change even when food is effectively abundant, but hoarding provides greater benefits, it is obviously a weakness related to inelastic and biology-related demand.

Let's not get all high and mighty. Let's also not forget that all economic systems face scarcity. The purpose of the market is not to eliminate scarcity, but to allocate resources. If you're implying that hoarding occours only in market economies, not to mention implying that Bangladesh is the litmus test for market economies, then you're really stretching it.

As for the second point, when corporations bribe politicians to impose regulations which favour them specifically at the expense of both their prospective rivals and consumers, that is an artificial barrier. When they don't receive such protection, that is not an artificial barrier.

Why is something an "artificial" barrier? How is it different from a "natural" barrier? Because the corporation uses the government? Boohoo. What if a corporation buys PMCs to protect their territory from others - is that "erecting an artificial barrier" to entering their territory? What if they treat their market shares or profits just like said territory and what to hire PMCs to protect that?

An artificial barrier is a legalistic one that imposes restrictions on market forces for the sake of the benefit of special interest groups. I'm not sure what a "natural barrier" would be, other than those related to limitations of production inputs. How do you protect market shares with private military companies, anyhow, and what does that have to do with market economics?

[Lord Zentei]

First point: obviously people economize when faced by high prices. I don't see why that's a particular weakness of the market system.

Stas seems to be making the same point I made earlier about consumer surplus.

Really? It seems like a very odd way of making that argument, especially since the implication seems to be that economizing resources is somehow a problem in and of itself and that it is somehow limited to markets.

[Flagg]

Maybe I'm just a filthy communist but every time the subject of billionaires comes up I am forced to ask, why do we allow them to exist? Is $999,999,999.99 not enough?

[K. A. Pital]

You'd rather have shortages than people not purchasing goods? You're not optimizing production that way, nor are you helping anyone with getting resources that they otherwise wouldn't have, so what's the point? Besides, the number of people who would purchase a good at a lower price can be inferred in a fairly straightforward way by applying the elasticity of demand to the market price and quantity and shifting the supply curve to the new price, reading the new quantity directly from the Supply-Demand graph.

I am saying that there is no functional difference between 20 people being unable to buy a product due to outpricing and 20 people being unable to get it due to deficit. Reading new quantity from the curve is quite possible. However, nobody seems to care about widely publishing data that would indicate just how many people cannot get Good A or B in the market. This data is obviously available, but never widely disseminated for the populace. The deficit is visible to people when a good is not there when they go to the shop. The other person who can't buy the product they are buying now is invisible to them. Thus a deficit is seen not only as a statistic, but as a daily and uncomfortable reality. In the market, you don't see people who can't buy the good when you go to the shop. Unlike the deficit, they are invisible to you.

Surely you can see that there's a fundamental difference between creating regulation that fosters competition between producers and ensures that market practices are honoured on the one hand and regulation which inhibits competition and fosters cronyism on the other?

No, there's no difference. Perfect competition can be a sub-optimal solution, whereas oligopolistic or imperfect competition or even outright monopoly can be an optimal solution. You call it cronyism; Boeing calls it "secure orders" and "preferrential customers". They get greater profits - at the expense of someone else, obviously - but so what? In the market, he who has more leverage as a buyer, wins. Like I said, cronies are a good or a service much like everything else. At a certain level it becomes a practical reality. Your ideal model can't really compete with it, because it injures the self-interest of large companies and sometimes even small companies. None of them would like that to happen. They don't want to abolish privilege in principle, they just want to get most benefit, which is to have such a privilege for themselves and not their competitors.

Let's not get all high and mighty. Let's also not forget that all economic systems face scarcity. The purpose of the market is not to eliminate scarcity, but to allocate resources. If you're implying that hoarding occours only in market economies, not to mention implying that Bangladesh is the litmus test for market economies, then you're really stretching it.

Hoarding with outpricing can only occur in a market economy. Command economies will have requisitioning and deficit, which is the non-market equivalent to the above, because prices are fixed. The purpose of the market is a non-moral function. There can be no deadly scarcity, but hoarding alone can lead to starvation. Thus resources are allocated in a more profitable but morally wrong way. Which is what I identified as a moral problem with the market - the most profitable allocation is not always the morally right one. You asked what the problem is, remember?

An artificial barrier is a legalistic one that imposes restrictions on market forces for the sake of the benefit of special interest groups. I'm not sure what a "natural barrier" would be, other than those related to limitations of production inputs. How do you protect market shares with private military companies, anyhow, and what does that have to do with market economics?

You protect market shares with PMCs or governments. There's no functional equivalent between an East India Company which keeps their dominion over a market (India) with guns and a government which keeps other companies out of Boeing's US market, say. They're both merely tools that the company can create/purchase to an end, which is maximization of personal benefit. The company has zero incentive not to do it. The government has huge incentives to cave in, because companies are the most powerful and resourceful market agents, already organized into collectives capable of mass action.

[Lord Zentei]

You'd rather have shortages than people not purchasing goods? You're not optimizing production that way, nor are you helping anyone with getting resources that they otherwise wouldn't have, so what's the point? Besides, the number of people who would purchase a good at a lower price can be inferred in a fairly straightforward way by applying the elasticity of demand to the market price and quantity and shifting the supply curve to the new price, reading the new quantity directly from the Supply-Demand graph.

I am saying that there is no functional difference between 20 people being unable to buy a product due to outpricing and 20 people being unable to get it due to deficit. Reading new quantity from the curve is quite possible. However, nobody seems to care about widely publishing data that would indicate just how many people cannot get Good A or B in the market. This data is obviously available, but never widely disseminated for the populace. The deficit is visible to people when a good is not there when they go to the shop. The other person who can't buy the product they are buying now is invisible to them. Thus a deficit is seen not only as a statistic, but as a daily and uncomfortable reality. In the market, you don't see people who can't buy the good when you go to the shop. Unlike the deficit, they are invisible to you.

No, with shortages and excess production, you're wasting resources in a manner which does not happen in a market. Moreover, maximization of production for any given input costs implies more production with finite input resources. Neither is it true that no-one speaks about those who can't afford X, Y or Z: it's called "politics".

Surely you can see that there's a fundamental difference between creating regulation that fosters competition between producers and ensures that market practices are honoured on the one hand and regulation which inhibits competition and fosters cronyism on the other?

No, there's no difference.

OK, you just jumped the shark into the very center of bullshit land.

Perfect competition can be a sub-optimal solution, whereas oligopolistic or imperfect competition or even outright monopoly can be an optimal solution. You call it cronyism; Boeing calls it "secure orders" and "preferrential customers". They get greater profits - at the expense of someone else, obviously - but so what? In the market, he who has more leverage as a buyer, wins. Like I said, cronies are a good or a service much like everything else. At a certain level it becomes a practical reality. Your ideal model can't really compete with it, because it injures the self-interest of large companies and sometimes even small companies. None of them would like that to happen. They don't want to abolish privilege in principle, they just want to get most benefit, which is to have such a privilege for themselves and not their competitors.

In what sense are you saying that perfect competition can be sub-optimal? How is securing customers in a market the same thing as government corruption? What are you talking about? You are not making any sense.

And this:

In the market, he who has more leverage as a buyer, wins.

...is plain old bullshit.

Let's not get all high and mighty. Let's also not forget that all economic systems face scarcity. The purpose of the market is not to eliminate scarcity, but to allocate resources. If you're implying that hoarding occours only in market economies, not to mention implying that Bangladesh is the litmus test for market economies, then you're really stretching it.

Hoarding with outpricing can only occur in a market economy. Command economies will have requisitioning and deficit, which is the non-market equivalent to the above, because prices are fixed. The purpose of the market is a non-moral function. There can be no deadly scarcity, but hoarding alone can lead to starvation. Thus resources are allocated in a more profitable but morally wrong way. Which is what I identified as a moral problem with the market - the most profitable allocation is not always the morally right one. You asked what the problem is, remember?

Hoarding only in a market economy? I guess you think that requisitioning and deficit (I guess you mean shortages) is more morally acceptable than people not choosing to buy? Except you already said that there's no functional difference.

And again: maximization of production for a given amount of finite input resources IS a moral issue.

An artificial barrier is a legalistic one that imposes restrictions on market forces for the sake of the benefit of special interest groups. I'm not sure what a "natural barrier" would be, other than those related to limitations of production inputs. How do you protect market shares with private military companies, anyhow, and what does that have to do with market economics?

You protect market shares with PMCs or governments. There's no functional equivalent between an East India Company which keeps their dominion over a market (India) with guns and a government which keeps other companies out of Boeing's US market, say. They're both merely tools that the company can create/purchase to an end, which is maximization of personal benefit. The company has zero incentive not to do it. The government has huge incentives to cave in, because companies are the most powerful and resourceful market agents, already organized into collectives capable of mass action.

Coercion and government corruption are NOT part of a free market, pretty much by definition. You appear to think that anything private interests do with their money is automatically under the aegis of the free market model. It just isn't. You might as well claim that gulags are an inherent consequence of socialism. Actually it's worse, since gulags are not anathema to socialism by the very definition thereof.

[K. A. Pital]

No, with shortages and excess production, you're wasting resources in a manner which does not happen in a market. Moreover, maximization of production for any given input costs implies more production with finite input resources. Neither is it true that no-one speaks about those who can't afford X, Y or Z: it's called "politics".

Who said anything about excess production?

In what sense are you saying that perfect competition can be sub-optimal? How is securing customers in a market the same thing as government corruption? What are you talking about? You are not making any sense.

Natural evolution favors oligopolistic competition or imperfect competition in 100% of practical cases = perfect competition is suboptimal, because real society shuns it out.

And this:

In the market, he who has more leverage as a buyer, wins.

...is plain old bullshit.

Yadda yadda. When there was food price spike in 2008, some nations experienced malnourishment increases simply because their citizens were way too poor to buy a limited supply good (that is, food) and outbid others who wanted the same food. And yes, the producer also has leverage. In fact, the bigger is an economic agent, the bigger it is a producer and consumer both, as it is very likely a rather complex production corporation which is buying and selling lots of stuff. The leverage increases with scale. It is also natural for capitalist systems.

Hoarding only in a market economy? I guess you think that requisitioning and deficit (I guess you mean shortages) is more morally acceptable than people not choosing to buy? Except you already said that there's no functional difference. And again: maximization of production for a given amount of finite input resources IS a moral issue.

Who said anything about maximization of production? The market agents maximize or optimize profit (depending on your theory of choice) and not production. I did not say requisitioning and deficit are more morally acceptable. I said market mechanisms can cause a famine when there's enough food to prevent it via simple hoarding. That is an issue of distribution which is effcient from the hoarder POV but inefficient from a overall society POV.

And yes, god damn it, hoarding can ONLY exist in MARKET economy, because when people start to hoard, the PRICE goes up and other people can't buy food and DIE. Deficit != hoarding. It can be no less deadly or damaging, but it is a different mechanism. With static prices, typical hoarding with outpricing cannot occur - hoarding is useful in a market economy because the price is rising and there's a negative feedback loop. In case of static fixed prices (and probably no free trade in anything), hoarding becomes pointless and impossible.*

* Unless there is external trade which we add to the system. In this case hoarding can occur on a transnational level, where it is no more pretty. In fact, it is fucking ugly.

Coercion and government corruption are NOT part of a free market, pretty much by definition. You appear to think that anything private interests do with their money is automatically under the aegis of the free market model. It just isn't. You might as well claim that gulags are an inherent consequence of socialism. Actually it's worse, since gulags are not anathema to socialism by the very definition thereof.

Gulags are just harsh forced penal labour institutions. Which can be present anywhere. Many nations utilized unpaid penal labour or draft forced labour. Gulags aren't anathema to socialism and coercion is not "anathema" to the free market. Economic coercion can occur under a free market. You're drawing a fine line between economic and non-economic coercion - like, if a company makes someone sign a contract to work for 12 hours a day because otherwise he'll starve (say, there's a raging famine around and the company decides to use that to their favor), that's a valid contract if the person signed it fully understanding the consequences. That's pure economic transaction. However, once you create any type of non-economic coercion (like a PMC keeping other companies out of India or imaginary Oilistan), the company is at fault for "breaching" your imaginary fairy-laws of the free market. However, the company only acts in its own interest. It is not obliged to honor any laws of the free market that you invented in theory. Your definition is then becoming a hollow utopia which can never realize itself in the real world because any market would tend towards imperfection; as it is beneficial for powerful companies, whereas perfection is counterbeneficial for the same, and agents in a market NEVER have equal leverage.

[Lord Zentei]

No, with shortages and excess production, you're wasting resources in a manner which does not happen in a market. Moreover, maximization of production for any given input costs implies more production with finite input resources. Neither is it true that no-one speaks about those who can't afford X, Y or Z: it's called "politics".

Who said anything about excess production?

I did. Overproduction is the flip side of shortages, both can occour in command economies. More importantly, you ignored the points I raised.

In what sense are you saying that perfect competition can be sub-optimal? How is securing customers in a market the same thing as government corruption? What are you talking about? You are not making any sense.

Natural evolution favors oligopolistic competition or imperfect competition in 100% of practical cases = perfect competition is suboptimal, because real society shuns it out.

Bullshit. Economies of scale determine whether production is perfectly competitive or oligopolistic. There is no "natural evolution" involved from one to the other, that's a Marxist fantasy with no grounding in reality.

And this:

In the market, he who has more leverage as a buyer, wins.

...is plain old bullshit.

Yadda yadda. When there was food price spike in 2008, some nations experienced malnourishment increases simply because their citizens were way too poor to buy a limited supply good (that is, food) and outbid others who wanted the same food. And yes, the producer also has leverage. In fact, the bigger is an economic agent, the bigger it is a producer and consumer both, as it is very likely a rather complex production corporation which is buying and selling lots of stuff. The leverage increases with scale. It is also natural for capitalist systems.

More bullshit. He who is more production efficient wins. This has nothing to do with the fact that regulation which fosters inefficient production is different from that which fosters competition.

Hoarding only in a market economy? I guess you think that requisitioning and deficit (I guess you mean shortages) is more morally acceptable than people not choosing to buy? Except you already said that there's no functional difference. And again: maximization of production for a given amount of finite input resources IS a moral issue.

Who said anything about maximization of production? The market agents maximize or optimize profit (depending on your theory of choice) and not production. I did not say requisitioning and deficit are more morally acceptable. I said market mechanisms can cause a famine when there's enough food to prevent it via simple hoarding. That is an issue of distribution which is effcient from the hoarder POV but inefficient from a overall society POV.

I said something about maximization of production. If you're going to (erroneously) morally equate shortages with people who don't buy because prices are too high, then that's the deciding difference between market economies and command economies. And while agents seek to maximize their profit, their interaction maximizes production for any given amount of input resources. Finally, you are misusing the concept of "efficiency".

Coercion and government corruption are NOT part of a free market, pretty much by definition. You appear to think that anything private interests do with their money is automatically under the aegis of the free market model. It just isn't. You might as well claim that gulags are an inherent consequence of socialism. Actually it's worse, since gulags are not anathema to socialism by the very definition thereof.

Gulags are just harsh forced penal labour institutions. Which can be present anywhere. Many nations utilized unpaid penal labour or draft forced labour. Gulags aren't anathema to socialism and coercion is not "anathema" to the free market. Economic coercion can occur under a free market. You're drawing a fine line between economic and non-economic coercion - like, if a company makes someone sign a contract to work for 12 hours a day because otherwise he'll starve (say, there's a raging famine around and the company decides to use that to their favor), that's a valid contract if the person signed it fully understanding the consequences. That's pure economic transaction. However, once you create any type of non-economic coercion (like a PMC keeping other companies out of India or imaginary Oilistan), the company is at fault for "breaching" your imaginary fairy-laws of the free market. However, the company only acts in its own interest. It is not obliged to honor any laws of the free market that you invented in theory. Your definition is then becoming a hollow utopia which can never realize itself in the real world because any market would tend towards imperfection; as it is beneficial for powerful companies, whereas perfection is counterbeneficial for the same, and agents in a market NEVER have equal leverage.

Coercion is anathema to the free market. If you don't get that, then you don't know what you're talking about. Moreover, it is obvious on its face that it is ridiculous to speak of "economic coercion" simply because people have to work, and completely asinine to compare it to forced labour camps.

And what do you mean by "fairy-laws" which exist in "theory"? I mean, what the hell?

[K. A. Pital]

I did. Overproduction is the flip side of shortages, both can occour in command economies. More importantly, you ignored the points I raised.

If we're talking about a single-good supply-demand model where a command economy makes 30 of Good A and a market one does the same, and both have 50 people, the deficit will be starkly visible in the command economy every time you go to a shop - almost a half of the people can't buy Good A. In a market economy, 20 are not buying Good A and you never see them when you go to the shop. There is no discomfort. At all. That is what I described as efficient masking. You don't bump into outpricing daily. You do bump into deficits all the time. I did not intend to discuss the particular problem of shortages. I merely said that the situation where there is a 20-unit deficit and 20-people outpricing is effectively equivalent for a single-good sector we are discussing here.

Bullshit. Economies of scale determine whether production is perfectly competitive or oligopolistic. There is no "natural evolution" involved from one to the other, that's a Marxist fantasy with no grounding in reality.

Economies of scale favor oligopolistic competition. End of story. I'm not sure why you chose to rail over "natural evolution" - natural evolution is pretty much what occurs when market agents compete. They reach the optimal scale where economies or rather, profits are maximized, which can inlucude minimization of costs and thus also maximization of economies, incl. that of scale. It is a natural process. You seem to be offended by me describing it as such? Why?

More bullshit. He who is more production efficient wins. This has nothing to do with the fact that regulation which fosters inefficient production is different from that which fosters competition.

Raising efficiency (production/cost) is just one method of maximizing profits. There are other methods, which have nothing to do with efficiency and everything to do with leverage. He who is more efficient only wins in a perfect competition. Add imperfections, and him "winning" is no longer a given. End of point.

I said something about maximization of production. If you're going to (erroneously) morally equate shortages with people who don't buy because prices are too high, then that's the deciding difference between market economies and command economies. And while agents seek to maximize their profit, their interaction maximizes production for any given amount of input resources. Finally, you are misusing the concept of "efficiency".

I am morally equating only equivalent shortages in a single-good sector. Which, surprise-suprise, healthcare is to some extent. Let us compare an NHS where there's 30 treatments available and 50 clients. 20 clients will go untreated. There's an equivalent market healthcare system where 30 treatments are available, and 20 clients simply can't afford it. 20 clients will go untreated. Complete moral equivalence, end of story. There's nothing erroneous about the equation. Efficiency for a private organization means only profits/costs, and not much more. An efficient transaction for the organization makes the most profit with the smallest costs. That is plain economic efficiency. Externalities can make such transactions bad for the overall society, but they don't make them "inefficient".

Coercion is anathema to the free market. If you don't get that, then you don't know what you're talking about. Moreover, it is obvious on its face that it is ridiculous to speak of "economic coercion" simply because people have to work, and completely asinine to compare it to forced labour camps. And what do you mean by "fairy-laws" which exist in "theory"? I mean, what the hell?

You obviously don't understand that I said economic coercion is perfectly viable. A person can be coerced by economic conditions. He cannot decline an offer if he has no other offer and will thus starve, his damage capacity is very limited. The company can decline his application with neglible consequences and hire another person. Therefore, the transaction is free from any non-economic coercion. There's no non-economic or administrative barrier here. Nothing.

I never compared it to forced labour camps, that is you ascribing me things. In fact, you chose to bring forced labour camps into a discussion about whether coercion represents a legitimate part of market economy.

By fairy-laws I mean you saying that companies or governments should strive to destroy barriers because the "free market" demands no barriers to competition, and they should thus act against their self-interest, because the barriers bring them benefits. You are demanding market agents to act against their self-interest, which is indeed anathema to the market.

[Lord Zentei]

I did. Overproduction is the flip side of shortages, both can occour in command economies. More importantly, you ignored the points I raised.

If we're talking about a single-good supply-demand model where a command economy makes 30 of Good A and a market one does the same, and both have 50 people, the deficit will be starkly visible in the command economy every time you go to a shop - almost a half of the people can't buy Good A. In a market economy, 20 are not buying Good A and you never see them when you go to the shop. There is no discomfort. At all. That is what I described as efficient masking. You don't bump into outpricing daily. You do bump into deficits all the time. I did not intend to discuss the particular problem of shortages. I merely said that the situation where there is a 20-unit deficit and 20-people outpricing is effectively equivalent for a single-good sector we are discussing here.

Stas, you ignored the point I raised again. Again: if you maximize production for any given level of input resources, that affects the amount of resources that are available to distribution. Thus the systems are not morally equivalent even if you equate shortages with people who don't buy a product. There is a way of distinguishing their relative merits.

Bullshit. Economies of scale determine whether production is perfectly competitive or oligopolistic. There is no "natural evolution" involved from one to the other, that's a Marxist fantasy with no grounding in reality.

Economies of scale favor oligopolistic competition. End of story. I'm not sure why you chose to rail over "natural evolution" - natural evolution is pretty much what occurs when market agents compete. They reach the optimal scale where economies or rather, profits are maximized, which can inlucude minimization of costs and thus also maximization of economies, incl. that of scale. It is a natural process. You seem to be offended by me describing it as such? Why?

Because it is bullshit. Whether economies of scale favour oligopoly or competitive markets is dependent on the microeconomic nature of the production in question. It is simply false to say that oligopolies are always more effective or that competitive markets inevitably evolve into them.

More bullshit. He who is more production efficient wins. This has nothing to do with the fact that regulation which fosters inefficient production is different from that which fosters competition.

Raising efficiency (production/cost) is just one method of maximizing profits. There are other methods, which have nothing to do with efficiency and everything to do with leverage. He who is more efficient only wins in a perfect competition. Add imperfections, and him "winning" is no longer a given. End of point.

We really need a facepalm smiley for this forum. Didn't I just point out the difference between regulations that foster competition and ones that foster corruption? And then you say something like this?

I said something about maximization of production. If you're going to (erroneously) morally equate shortages with people who don't buy because prices are too high, then that's the deciding difference between market economies and command economies. And while agents seek to maximize their profit, their interaction maximizes production for any given amount of input resources. Finally, you are misusing the concept of "efficiency".

I am morally equating only equivalent shortages in a single-good sector. Which, surprise-suprise, healthcare is to some extent. Let us compare an NHS where there's 30 treatments available and 50 clients. 20 clients will go untreated. There's an equivalent market healthcare system where 30 treatments are available, and 20 clients simply can't afford it. 20 clients will go untreated. Complete moral equivalence, end of story. There's nothing erroneous about the equation. Efficiency for a private organization means only profits/costs, and not much more. An efficient transaction for the organization makes the most profit with the smallest costs. That is plain economic efficiency. Externalities can make such transactions bad for the overall society, but they don't make them "inefficient".

Please quit using the term "economic efficiency" that way, that's not the correct usage of the term. And you again ignore the point: even if you assert that there is moral equivalence between shortages and non-buyers, then you are left with other means of evaluating the relative merit of economic systems - such as level of production for a given level of input resources.

Though I find it interesting that you choose to select the NHS as an example after I explicitly said earlier that I am pro-welfare.

Coercion is anathema to the free market. If you don't get that, then you don't know what you're talking about. Moreover, it is obvious on its face that it is ridiculous to speak of "economic coercion" simply because people have to work, and completely asinine to compare it to forced labour camps. And what do you mean by "fairy-laws" which exist in "theory"? I mean, what the hell?

You obviously don't understand that I said economic coercion is perfectly viable. A person can be coerced by economic conditions. He cannot decline an offer if he has no other offer and will thus starve, his damage capacity is very limited. The company can decline his application with neglible consequences and hire another person. Therefore, the transaction is free from any non-economic coercion. There's no non-economic or administrative barrier here. Nothing.

That is why we demand a competitive market. And incidentally, this so-called "economic coercion" as you call it is not comparable to coercion by force. Obviously all economic systems exist to encourage people to work.

I never compared it to forced labour camps, that is you ascribing me things. In fact, you chose to bring forced labour camps into a discussion about whether coercion represents a legitimate part of market economy.

By fairy-laws I mean you saying that companies or governments should strive to destroy barriers because the "free market" demands no barriers to competition, and they should thus act against their self-interest, because the barriers bring them benefits. You are demanding market agents to act against their self-interest, which is indeed anathema to the market.

There is a difference between government and agents in the economy. This point you raise is meaningless. BTW, I didn't raise labour camps except as a comparative example of absurd statement.