When I woke up this morning, I was feeling some guilt over venting my frustration in my last post and to make up for it, thought I had hit upon an example of successful libertarian enterprise to offer up - the toll road! Many early turnpikes and bridges were developed by private companies, which is a libertarian kind of concept, isn't it? Then, of course, as I started to research the topic, I discovered I was wrong. <sigh> Turns out they were all government-instituted monopolies...

Schlack's dissection of the fishing industry example turns out to be historically harmonic to the turnpike situation. The problem, I discovered, is that most such enterprises start with a governing authority granting a monopoly (large or small) by fiat. The concept of property rights, so central to libertarian thought, turns out to rest upon the creation of a "state" entity (with the coercive aspects inherent therein), which can then dictate the terms of such "ownership." In the absence of any kind of governing (coercive) authority, as exists in the open seas, each individual is free to take however many fish he wants, subject only to the existence of the fishery. This will continue until the fish stocks are depleted entirely. Schlack's discussion also brought me full-circle to the first response and Checkerboard's reference to Somalia...

If you think about it, the problem off Somalia is libertarianism in a microcosm. Here you have the "free market" at work. Pirates Entrepreneurs in Somalia have identified a means of making money and they are exploiting the local resource (Gulf of Aden) to get ransom money profits (call it a toll) from shippers transiting their locality. Shippers are willing to pay (willing buyers) to the Somali pirates entrepreneurs (willing sellers) for the privilege of using the waterway. Shippers have a choice - they can arm their ships and make it more difficult for the pirates entrepreneurs, but then the cost of ransom the toll will go up; they can ship further away and avoid the Gulf of Aden, but that will add to the expense of shipping, and, after all, only a small percentage of their shipping is subject to this free-lance toll process. This is pure libertarian market economics.

Anyone see any flaws in this example?
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Here, as elsewhere, people are outraged at what feels like a rigged game -- an economy that won't respond, a democracy that won't listen, and a financial sector that holds all the cards. - Robert Reich