1. Skip to navigation
  2. Skip to content
  3. Skip to sidebar
Source link: http://archive.mises.org/14158/did-the-free-market-burn-down-the-house/

Did the Free Market Burn Down the House?

October 6, 2010 by

A strange argument emerged overnight that illustrates how little even informed people understand about the market economy and its implications. This time the debate centers on a interesting case of a man in rural Tennessee who did not pay his fire-services fee, so the fire department let his house burn down. Here is the news report.

You can see that this incident is being used to attack libertarianism.

National Review’s Daniel Foster jumps in to say that this is why conservatives need to curb their enthusiasm for the market economy. A colleague in the “anarcho-capitalist” camp stuck his head into Daniel’s office to explain that fire protection is not a human right, so it makes sense that the house was allowed to burn. Paul Krugman (he never goes away) adds that this is a case against the market in general. “Do you want to live in the kind of society in which this happens?”

I don’t get this debate at all. It is not even a real debate. The fire-protection services were government services. The fee in question was a government-mandated fee. The county lines in which the fee was applicable is a government-drawn line that is completely arbitrary. The policy of not putting out the fire was a government policy enforced by the mayor. As he said, in the words of a good bureaucrat, “Anybody that’s not in the city of South Fulton, it’s a service we offer, either they accept it or they don’t.”

So why is the market being criticized here? This was not a real market. Instead, this is precisely what we would expect from government. In a real market, there is no way that a free-enterprise fire service would have refused to provide the homeowner service. They would be in business to provide that service. The fire would have been put out and he would have been charged for the service. It is as simple as that. It is the same as lawn-mowing services or plumbing services or any other type of service. Can we know for sure that the market would provide such services? Well, if insurance companies have anything to say about it, such services would certainly be everywhere.

As it was, the fire burned down as a result of government policy, a refusal of service because the homeowners did not pay what amounted to a tax! The poor homeowner begged for help and offered to pay. He had paid the year before and the year before, so his credit was good. Even so, the bureaucracy refused! (The whole thing reminds me of a scene from Gangs of New York.)

A market doesn’t just mean fee-for-service. The government cannot mimic the marketplace by merely setting prices on its services. A free market means that producers are responsible to consumers in a world of private property and free exchange. Why is this so difficult to understand?

Robert Murphy gets it. So does David Henderson. Salon, meanwhile, writes up the news with a picture of Hayek next to a burning house.

{ 251 comments }

Phinn October 6, 2010 at 8:54 am

This whole episode, and the insane commentary surrounding it, are absolutely astounding. I feel like I’ve been dropped into some bizzaro universe where everything superficially sorta looks normal, but has been contrived set up to screw with my mind. It feels like the entire world is gaslighting me.

In addition to the fact that this fire company was an entirely governmental operation, we can ask: Why was there no private fire protection service standing by waiting to put out the fire?

A. Because no one in his right mind would start a private fire protection company in an unincorporated neighborhood adjacent to an existing town since the town could forcibly annex the neighborhood at any time, and then take over all such services by fiat.

B. Because the county fire company might decide to waive its $75 “fee” at any time, and instead subsist on its tax revenues, something no private competitor could do, and thus run the private company out of business overnight.

Is it really so hard to understand this stuff? My faith in humanity is at an all-time low these days, and that’s really saying something.

Fephisto October 6, 2010 at 8:59 am

This is why I’ve stopped watching the “mainstream” news.

I _might_ come back if they did something like…have Robert Murphy as an anchor or something.

Colin Phillips October 6, 2010 at 9:11 am

Oh wow, that’s a fantastic idea!
Mises News Network, Actual News at 7, with Robert Murphy.
I’d watch.

Ko October 6, 2010 at 1:15 pm

‘Actual News at 7′

brilliant!

Curt Howland October 6, 2010 at 10:02 am

But only in Zombie makeup!

Bob Murphy October 6, 2010 at 9:02 am

Fephisto, I actually was in the running for Countdown, but Olbermann got it because there was less glare off his forehead.

J. Murray October 6, 2010 at 9:45 am

That’s what happens when there isn’t a brain inside excreting brain juice.

Jeff G. October 6, 2010 at 4:55 pm

Like

Jack October 6, 2010 at 9:09 am

I’m just really confused on this one.

I’ve read the Salon article and the comments. Nary a person explaining that to the extent this is a failure, it is a government failure, because it was a government fire agency.

I mean, I have to think that the Salon writer and the commenters are all either stupid or evil. If they seriously believe that a failure of government can be blamed on libertarianism, then… I don’t even know what to say. Did government schools cause this lack of critical thinking?

Convince me I’m wrong. Convince me it’s some practical joke. Are they all going to write blog posts saying “Just kidding! You should have seen the look on your face when you thought I was so stupid as to believe that government failure indicted libertarianism!”

Franklin October 6, 2010 at 9:40 am

Parallel to other blogs about the Tea Partiers referencing “old books,” or sports writers bitching about athlete’s spending habits, there is no doubt that the establishment leftists (Olbermann, King, NY Times journalists, et. al.) are very worried. And well they should be, since they perceive this as an attack on their lifestyle, their comfort zone, their gravy train.

So on the one hand it gives me cause to chuckle.
But on the other, the leftists need not worry. No matter how angry is the electorate, the size and scope of government will continue to grow, as it has for hundreds of years.
As Phinn kicked off the responses, it is indeed like some “bizarro universe,” and one of which there is no escape.
And to Jack’s understandable astonishment, there will be no “Just kidding, folks.”

Now is there any doubt for anyone, anyone at all, as to what we are dealing with?

JFF October 6, 2010 at 9:44 am

It doesn’t need to be correct, complete, or accurate; all it needs to do is plant a seed of doubt or drop water on an already budded sprout. Intellectual laziness does the rest.

People like Salon and Olbermann have made up their minds as have their readers and viewers. The point of propaganda is to repeat it enough times with the right tone and in the right manner so that it can’t ever leave the mind of the audience, much like the chorus to that song you can’t get out of your head. Eventually it becomes a feedback loop and triggers a self-perpetuating reaction.

As for the Salon article’s author and commenters, I think they don’t know what they’re talking about but I’m very sure they don’t care.

JDM October 6, 2010 at 10:41 am

Hahaha! WHO repeats things enough times until it sounds like the truth????

Seattle October 7, 2010 at 1:38 am

Universal Healthcare works! The WHO says so!

Matzpen October 6, 2010 at 9:46 am

When government is run like a business, this is exactly what you get. We enter novelist-philosopher Ayn Rand’s objectivist ideal, a world where “individualism” reigns, yet the individual and community suffers.
http://sherrytalksback.wordpress.com/2010/10/06/the-rights-new-tough-love/

Jack October 6, 2010 at 9:52 am

Oh give me a break. The libertarian/capitalist ideal is a private system, not a government-run fee-for-service one. Stop with the misrepresentations.

J. Murray October 6, 2010 at 9:59 am

Government can’t be run like a business. Businesses have to deal with competition and have the specter of bankruptcy and going out of business. Governments just raise taxes to cover the shortfall.

Ko October 6, 2010 at 1:17 pm

J. Murray 1
Matzpen 0

Phinn October 6, 2010 at 10:05 am

>>From Sherry’s article: And so Gene Cranick is now the latest victim of shrink government, praise individualism gone amuck. This is madness that must be challenged.

Sherry, I am really interested in trying to understand where you are coming from, because I really don’t understand the anti-market position on this story.

The point we pro-market people are trying to make is that this house fire-response problem was NOT a market situation. It was a county fire department, setting a governmental policy, and arbitrarily setting a price (since there are no competitors for government services), and arbitrarily setting a governmental policy for not paying.

Is any of this clear? Please help me explain any part of this that is not clear.

A true market-based system would look something like this: more than one private company would offer this service (much like lawn mowing services exist, or alarm company services, etc.), and they would charge according to what competitors were charging while still remaining solvent, and they would have every reason to want to provide the service with top quality at the best price.

Also, is it not clear that if Mr Crannick had simply been charged a tax, required of him by the government, and he had not paid it, then the response would have been to put out the fire, but then foreclose and seize his house based on the tax lien.

Does any of this make sense? Where is any of it incorrect?

Franklin October 6, 2010 at 10:35 am

You might as well be trying to convince the family dog, as effectively as this crackpot.
These WLB’s (whiney little bitches, to steal Harmoniums’s acronym on another post) are so transparent. Fascists through and through.
I really tip my hat to you for trying nonetheless. I do.

Enjoy Every Sandwich October 6, 2010 at 6:20 pm

That’s for sure. I’ve noticed that the blogger in the link is utterly unable to answer a reasoned argument, and indeed does not even try; her efforts to be snide even fall flat.

Enjoy Every Sandwich October 6, 2010 at 12:11 pm

Just when did the Objectivists take over Tennessee? I must have missed that news flash.

Zach Bibeault October 7, 2010 at 2:39 pm

When government is run like a business, it fails. When government is run like government, it fails. When commenters play this false dichtomy as if it is a valid critique against liberty, THEY fail.

Dennis October 6, 2010 at 9:51 am

The real choice is do you prefer to live in a society in which individuals (absent the voluntary assistance of charities) are only entitled to consume what they have produced and acquired through free exchange, or are permitted to use the legalized violence of the state to obtain what they consume.

The first case produces a truly ethical society, while the second results in barbarianism.

The Majority October 7, 2010 at 9:25 am

But…paying for stuff is hard…why can’t someone just take care of me and tell it will be okay?

Curt Howland October 6, 2010 at 10:15 am

I don’t expect my post to that video to be “approved”:

He still has the property, and can rebuild if he wants to.

Imagine if he’d “forgotten” to pay his property taxes and the fire department was paid out of them. This wouldn’t have happened, because they would have taken both house and property away from him for “back taxes”.

He’d still be out of the house.

DayOwl October 6, 2010 at 10:29 am

Only a government bureaucrat can get away with saying “Too late! You can’t pay now!”

Massachusetts suspends your driver’s license for non-payment of municipal taxes. My relative owes one city a fairly small amount ($45) of taxes. They cannot mail the tax payment to the city. The city will only allow them to pay the taxes in person at city hall. Since my relative cannot get to this city any longer due to their driver’s license being suspended, because they haven’t paid the tax, they cannot pay the tax to resolve the problem because the city won’t let them pay the tax. How’s that for bureaucracy?

Jkillz October 6, 2010 at 10:38 am

The only thing that describes this newest level of statist ignorance-to-the-point-of-irony is:

FUBAR.

Franklin October 6, 2010 at 10:45 am

I’m afraid, sincerely dismayed and discouraged, that BAR is accurate. Completely.

Aubrey Herbert October 6, 2010 at 10:47 am

Oh man, this makes my blood boil.

lester October 6, 2010 at 11:33 am

government or not they really need a better system in that town. You can’t let a house burn down because someone forgot to pay 75 dollars! I understand the fire co. concern though. If you let people just pay when they have a fire no one would pay.

I don’t think anyone is going to vote for a dem because of this though. nice try, media libs!

Michael Hiles October 6, 2010 at 11:34 am

So, the case they’re really making is that even though we’re taxed at a premium, we receive subpar services from the government.

I simply cannot wait until they control all healthcare services. Then it won’t be a house burning down because of some bureaucratic screwup, it will be your 4 year old daughter bleeding to death on an ER gurney while some D-bags stand around watching.

Enjoy Every Sandwich October 6, 2010 at 11:57 am

What’s bizarre to me is how they can attribute all the world’s woes to libertarians, since they regularly insist that we’re a powerless fringe group that has no influence because everything we say is so nutty. Geez, however nutty we might be we can at least keep our story straight for more than 3 seconds.

Brad October 6, 2010 at 12:08 pm

One this flip side of this… if the home owner knows that there is a fee, and doesn’t pay… but his neighbors pay… then why in the heck does he expect the same services???

You know, the Obama’s of the world keep blaming ‘greed’ for causing all the problems of the world… and in a way he’s right. If this home owner wanted something for free that his neighbors are paying for, I’d call that greed. This guy essentially wanted his neighbors stuff… and thought that he had a ‘right’ to it.

If that’s not greed, then I don’t know what is. Everyone in this damn country think that they have a ‘right’ to everyone else’s stuff. If you lose you’re job, then you have a ‘right’ to my money… which means my purchasing power is gone, and someone else is probably going to lose their job. Greed. Wall St to Washington deal making… takes my money to pay off their gambles. Greed. Union/Social Security/Medicare – old people taking a 20-30 year vacation on the backs of young working kids… Greed, Greed, Greed…

This guy and his house is a perfect example of greedy bastards expecting something from everyone else… for ‘free’.

And as the article suggests… the only way this system exists is because of government. Because people think that because they’re elected, they somehow have rights OVER everyone else. We have become a nation that elects our lords and masters…

… God Bless us all.

Patzermom October 6, 2010 at 4:46 pm

ITA with some of what you said; HOWEVER, the irony to me is that Obama and his ilk are the TRULY greedy ones in their interpretation that all income belongs to THEM to dole out as THEY see fit. Gotta love Marxism.

Julien Couvreur October 6, 2010 at 12:13 pm

I must say, I’m puzzled by that one too. Boing Boing has a thread on this too, with many comments against libertarianism: http://www.boingboing.net/2010/10/04/firefighters-watch-a.html

Notice how people come up with absurd scenarios, which tells me that people are really attached to the idea of government-run firefighting. There must be something in the education system or the culture to explain this. Maybe it is that firefighters are seen as heroes since we are kids, and therefore it must be impossible that they function in the market. I don’t know.

J. Murray October 6, 2010 at 12:22 pm

Being able to envision something that does not currently exist is a higher mental function that most humans tend to lose by the time they turn 12. Few of us keep this precious ability while most others tend to get nearly hard-locked into their view on the world at an early age. Doing something different is terrifying because of fear generated by being unable to critically examine how something different would operate. Most humans live in a black and white world. There is either how it’s operated now or those services viewed as critical cannot exist. Again, this thinking persists because most individuals cannot comprehend alternatives to the current paradigm.

Dave Albin October 6, 2010 at 2:05 pm

Yeah, the think outside box idea is lost on most people. People tend to fear the unknown (or, in our case here, the unseen).

Jordan Viray October 7, 2010 at 3:59 am

“Being able to envision something that does not currently exist is a higher mental function that most humans tend to lose by the time they turn 12. Few of us keep this precious ability while most others tend to get nearly hard-locked into their view on the world at an early age.”

Wow, do you have a source for that? That’s an awfully bold assertion.

J. Murray October 7, 2010 at 5:37 am

http://www.thehelpgroup.org/pdf/Delis_HANDOUT.pdf

It’s a bit academic, but it’s support.

A lot of it has to do with the structure of our education system. Absract and creative thought tends to be taught out of us since the school system is set up as a rote memorization exercise and places priority on list learning. I personally had a very difficult time dealing with the public school system. Between being bored and being forced to learn in an environment that placed preference on memorization over understanding, I always came off as a marginal student.

I’m glad I didn’t have to go through the Japanese school system. I’d have failed out of it since it’s almost 100% memorization based. At least the US school system, as sad as it is, has at least some semblence of course work in the abstract, which is what kept me in the passing range for my classes.

Jordan Viray October 7, 2010 at 7:15 pm

Thanks for finding a proper academic source although the one you linked to does not appear to support your claim. The conclusion of the study was merely that IQ and Executive Function are not closely correlated.

Was there a different study that looked at EF vs. age alone to back up your statement? My intuition is that executive function tends to improve with age (perhaps until it regresses in “second childhood”) but would be interested in data that shows otherwise.

Andrew Mitchell October 6, 2010 at 4:58 pm

Julien,

It’s almost completely at the hands of schooling. If you read the Underground History of American Education by John Taylor Gatto it pretty much spells out how our schools are giant idiot making factories that produce incomplete people that are unable to think for themselves and lack how to critically think about the world around them.

Drax October 7, 2010 at 9:31 am

Great book Andrew. Gatto’s treatise has sharpened my ire against public schooling and I will do whatever I can to protect my children from its diseased soul-sucking tentacles.

ABR October 7, 2010 at 11:12 pm

Another book of his is available online at LewRock, chapter by chapter.

http://www.lewrockwell.com/gatto/gatto-uhae-17.html

Mac McCarthy October 6, 2010 at 1:26 pm

How about a real scenario to contrast this nonsensical situation with?

In a suburb of Scottsdale, AZ, a private fire company offers services to the homeowners. There’s an annual fee you can pay – something like $75 a year – but it’s optional.

If you have a fire and are not a subscriber, the fire department comes out and (with your approval) puts out the fire. Then it bills you for its costs – which as you can imagine can run into a lot of money.

In other words, they’re selling insurance. But either way, they put out the fire. (Unless you tell them not to.)

That’s the sensible way to handle this. It’s the way a free market handles it, when give the opportunity.

“Rural/Metro Fire Department, Inc., a private firm headquartered in Scottsdale, Arizona (pop. 96,000). Rural/Metro provides fire protection to thousands of individual subscribers in several unincorporated communities in the state. ” See “Local Problems, Libertarian Solutions” for specifics at http://www.amatecon.com/etext/lpls/lpls-ch5.html

Can private fire services work? They do. Another example is Denmark, where they’ve had private fire companies for decades.

Conclusion: Most discussions on issues like this are fact-free.

CBM October 6, 2010 at 1:31 pm

Why not put out the fire and then charge the homeowner for the services rendered, I assume in the thousands of dollars (cost of equipment/personnel). Refusal to pay for the services rendered would simply lead to the city in question placing a lien on the property. Eventually, the city would be paid for the services rendered.

Jack October 6, 2010 at 2:37 pm

There was a government regulation against this. It was a government policy to not put this guy’s fire out, cause he didn’t pay.

Scott D October 7, 2010 at 8:07 am

Government policy, government failure.

Delo October 6, 2010 at 1:37 pm

He lived outside the city. The city charges $75/year for fire protection. He didn’t pay. No fire protection. Dang! They should put the fire out anyway. He didn’t pay his homeowner’s insurance. Dang! They should replace the house anyway. He had a car accident. Didn’t pay the insurance company for liability or collision protection. Dang! They should pay anyway. He gets sick. He didn’t buy health insurance. Dang! They should pay anyway. ETC.,,, Not my fault! It was George Bush’s fault.

Franklin October 6, 2010 at 3:31 pm

I thought this was an excellent response, summing the mentality, with all its confounded hypocrisy, hubris and prejudice, into the typical leftist’s mind-numbed paradigm, culminating in the brain dead fingerpointing toward the alleged right and the self satisfied pandering to the alleged left.
Nice and to the point.

DayOwl October 7, 2010 at 7:44 am

I do wonder why there is so much outcry that someone who didn’t pay for the service didn’t get it. The same thing happens if you don’t pay your power bill. My parents live in the middle of nowhere, and they pay a small fee every year for helicopter service in the event of an emergency, because the local government cannot provide it in a timely manner. They feel lucky to have access to the service, nor do they feel outraged that they must pay for it.

The best way to handle this situation would be to put out the fire then present the homeowner with a bill for the entire cost of the service–far greater than $75. The really disgusting part of this whole episode is the petty bureaucratic power trip that caused it. And make no mistake, it was a demonstration of power, not business sense. The same thing happened in my own city/county about ten years ago. Due to disputes over budgets, the city fire department just sat by and watched a house just over the city line burn down to make their point about funding. In this case, the homeowner had no part in it. It was all city/county politics.

The law suits are going to cost the city far more than putting the fire out would have. It’s going to be a very costly stand on principle. They may get more people to pay the fee, but they’re going to need those fees to pay the bill for this fiasco. I’m not advocating or arguing that a lawsuit is justified, but it’s almost inevitable.

In other news, the city is looking for a new fire chief…

BradS October 6, 2010 at 1:38 pm

Now if you lean more towards the libertarian persuasion, this was actually a good lesson:

1) You know how much you pay for emergency fire services – good for the consumer.
2) The Insurance company (covering the loss) should have known the risk and made sure coverage was in place to mitigate their loss.
3) All services should be provided along these lines, and private companies should be able to compete against public companies for your consumer dollar.
4) Insurance companies may want to contract with private and/or public service providers to mitigate loss and pass those costs to the consumer as part of their annual coverage.

metropolitan October 6, 2010 at 1:42 pm

i don’t think anyone is blaming the market. what they are blaming is the thinking that government should be run as a business, not as a service to the community.

C. Rakish Spagaletto October 6, 2010 at 1:50 pm

Does anyone know what Jeffrey means by: “A market doesn’t just mean fee-for-service. The government cannot mimic the marketplace by merely setting prices on its services.”?

J. Murray October 6, 2010 at 2:02 pm

What it means is that, absent a competitive market, a price is a meaningless number. Prices are information meant to provide information on the priority of the product or service in question. It represents what an individual is willing to give up for it crossed with what the provider is willing to accept until it reaches a meeting point where both consumer and provider agree to engage in the transaction.

With governments, the price itself is meaningless as governments typically don’t have competition. Sure, some aspects of life have private providers offering the same services as government, but due to various advantages, these private providers are either muscled out of business though governmnet’s subsidized standing or regulated out of existence if the government service is threatened (see Lysander Spooner’s American Postal Service).

Because governments are true monopolies, they can set prices wherever they wish. Because of the government’s unique position to legally disallow competitors and the power to tax, the price can be set without any consideration of the profitability of the service or product in question. Profitability is the single most important indicator of whether a company is doing a good job or not. Political pricing tends to set prices low and backdoor subsidizes any loss with involuntary taxation. Pricing the service becomes a meaningless exercise as everyone pays for the service one way or another, either because they’re forced to use it as all competition is de facto banned or they’re being taxed to subsidize low prices to make up for insufficient revenues to provide the service.

C. Rakish Spagaletto October 6, 2010 at 2:36 pm

Excellent. Thanks very much.

Franklin October 6, 2010 at 3:49 pm

Heh, I could just imagine poor J. submitting this thoughtful assessment to that talking-headed caricature, that blunderbuss, via satellite, with the other self-promotion minded nitwits awaiting their turn.
“….absent a competitive market, a price is a meaningless number. Prices are information…”
His microphone goes mute, as the producer cuts to the site of the ash-laden woodland with poorly dressed victim staring at the rubble that was once his home, and the Olbermann, not missing a beat, voice-over completes the picture:
“Okay, so that I understand you correctly — and the footage you see is the remains of the home; thank God nobody was hurt — you’re saying those who ‘can’t afford’ should have all their beloved possessions scorched to soot. Well, thanks to our guests this evening… I think. Pfft, we’ll be back after this break.”

Sasha Radeta October 6, 2010 at 2:18 pm

This is yet another occasion where I disagree with Bob Murphy and the majority position on Mises.org (when I defended Peter Schiff’s correct warnings about current account deficits as a symptom of an unsustainable boom – the crowd falsely accused me of isolationism… I hope to have a better luck this time :-).

Let me ask you a question: what makes you think that a privately-run fire-house insurance agency would necessarily provide the service of fire-fighting to those who did not subscribe to its protection plan? If private fire-house were to provide such service in case of the emergency — this would reduce incentives for households to pay for insurance. The reason is simple: given the probability of ever having a house-fire and knowing that there is always a last resort to help you at a price that market is willing and able to pay — many people will gamble by deciding to pass such insurance. Fire houses, with its expensive capital and human resources, would have been forced to sit idle without any pay before a fire occurs in their area… and then the market price for such service will depend on ability of people to pay and the presence of competition… Not the mention the issues with collection of debt, etc.

Put yourself in a position of for-profit, private fire-house. The logical choice is to provide fire-fighting services only to those who got insured with your agency. Again, it is simply a matter of attracting customers by raising the potential cost of being uninsured.

Is there anything wrong with that? Should I feel bad for a person that willingly passes such insurance in order to get something else? Absolutely not! All this anti-capitalist propaganda revolving around this fire incident just proved that there is no issue of free rider in a pure market economy and that “public good” issue is a false assumption (it is one of the basic textbook arguments used to prove the inevitability and necessity of government’s existence).

PS
Private fire-house insurance agencies could perform bona-fide services for people who really can’t afford such service for some reason – but it is really up to them and their PR.

Jack October 6, 2010 at 2:39 pm

“Let me ask you a question: what makes you think that a privately-run fire-house insurance agency would necessarily provide the service of fire-fighting to those who did not subscribe to its protection plan? “They would likely do it at the elevated cost. The man in the story was offering to pay all costs. You seem to think that at the scene of the fire, the homeowner would be demanding the ex ante insurance rate, instead of offering to pay in full. A private company would have done it (transacted at elevated price) – first to make money, and second, to ward off any tarnishing of the reputation.I don’t think you’ve read very much of the discussion on this issue.

Sasha Radeta October 6, 2010 at 3:52 pm

Jack,

You mention elevated costs — but that’s the essence of my argument: they would get more money by elevating costs of not getting insured (likelihood of being a fire victim becomes more significant if consequences of such fire get more expensive).

Companies cannot elevate prices to the point at which the customer is unable or unwilling to pay. If the price becomes too large, they may even loose customers – or never to collect its receivables.

Reputation is not as stake here if they provide charity service for the poor and prevent forest fire with an “environmental” excuse for regular checks and clean-ups (actually saving their own money). Loosing their insurance business would hurt them a lot more.

I read just enough on this topic, thanks for being concerned!

Alex Courtney October 7, 2010 at 11:51 pm

Sasha,

If there is a mortgage on the property (likely), in a free market with private fire companies, the lender may demand the homeowner carry fire service insurance as a part of the loan contract (since it wouldn’t be provided through government theft). Or perhaps the lender would only demand that I carry standard homeowners insurance. But the homeowners insurance would likely give me a decent discount should I also carry fire service insurance. They’d probably sell the product, then pay the fire company the necessary fees to keep them in existence.

Also, Drs. existed long before health insurance, mandated or not. So to state that private fire companies would not exist without mandated fire insurance (via government taxation) is a bit of a stretch.

Finally, government fire services don’t stop house fires from occurring, nor do they prevent houses from being partially or fully destroyed. Its not as though if he had simply paid his $75, this man’s house would’ve been miraculously saved. Likely it would’ve sufferred extensive smoke damage (at minimum) and then water damage from putting out the fire. It also may have sufferred significant loss from the fire itself, depending on how quickly the fire service was able to get it under control. The cost to restore the government “saved” house may have been just as much to rebuild.

Sasha Radeta October 6, 2010 at 4:00 pm

Michael A. Clem October 6, 2010 at 2:44 pm

Sasha, you have a reasonable point. However, private enterprise is more likely to resolve this than you think. For one thing, they could simply charge a high price for “emergency service” to anyone who didn’t pay the low subscriber fee. And make no mistake, private fire-protection companies would have the incentives for making the fees as low as they can, ensuring that as many people as possible can afford the services. Another possibility is that fire-protection services would be absorbed under home insurance costs, as the insurance company would have an incentive to reduce the risks of house fires. No doubt that a free market could devise other strategies and means for providing fire-protection that don’t even occur to me. For example, houses could be made of more fire-resistant materials in the future. Thus, while I won’t say that it’s impossible for somebody to not get fire protection services (and in some extreme cases, it may simply be more cost effective to let it burn down and replace it), I will say that it would be unlikely that they couldn’t get *some* kind or level of service, if they really want or need it.

J. Murray October 6, 2010 at 2:50 pm

Also, they would likely act the same way hospitals do and perform the service simply to avoid looking bad. Even before the 1986 mandate, no hospital in America ever turned away an emergency situation due to inability to pay. Many of them build in this inevitable cost as part of the service because no matter how costly providing the service may be, the shitstorm that would come down on that hospital if they actually did let someone die due to inability to pay would be far, far worse.

Sasha Radeta October 6, 2010 at 4:14 pm

J. Murray,

If lives were at stake – who says a private company would not intervene for PR purposes… However, that does not disaprove my arguments.

Hospitals are not run by private insurance agencies and their business is completely different from fire-houses (much more intervention and less dependence on a single emergency case as a source of revenue). However, insurance companies refuse to allow coverage for many procedures all the time. If they were in a position to own hospitals, do you think that they would contradict themselves?

PS
In addition to many other factors, hospital care is so darn expensive precisely because so many people don’t pay it (costs accumulate).

J. Murray October 7, 2010 at 5:39 am

Insurance companies refuse to pay. That doesn’t mean the procedure won’t go through. Insurers have no say on whether or not the service is rendered. You’d be hard pressed to find many instances in the USA where a hospital outright refused to perform a life saving procedure because the insurance agent said no. That’s a common feature of a universal care system, however, as the bureaucracy made the decision and no one can, even if they’re willing or able to obtain alternate funding, get the procedure.

Joshua_D October 6, 2010 at 3:05 pm

I’m not sure I’m sold on this point. Private companies turn away people all the time even when it’s an emergency. Insurance, for example, simply will not let you buy a policy after the fact. And, even if home insurance required fire protection, what would prevent a person from refusing insurance? Maybe the bank wouldn’t loan money. Point taken. But, what about the guy who saved his money, built his house, refused home insurance, refused fire insurance, and then called the private fire protection service offering to pay what ever it takes when his house catches fire? I mean, isn’t this the classic example of moral hazard?

Anthony October 6, 2010 at 7:29 pm

Joshua,

Insurance is intended to pool the risk of a catastrophic event over many people… after the event has occurred there is nothing to insure against since the catastrophe has already happened.

The fire example would be akin to not buying health insurance and then paying for care at the time of treatment.

Just Isaac October 6, 2010 at 7:50 pm

Your analogy is broken. Health insurance does refuse to *insure* your health after something traumatic, but then again, they don’t actually offer health services, merely the insurance for them. Hospitals on the other hand *do* offer actual health services, and they will charge higher fees for emergency service if you don’t have insurance.

In fact, I doubt we would have combination fire insurance and fire services. We would likely have companies that work more like hospitals; they would simply provide the service when needed at a reasonable cost, and then you would take the bill to your home-owner insurance company.

Sasha Radeta October 6, 2010 at 3:59 pm

Michael,

If a company knows it can’t collect or even charge a significant market price for its emergency service, refusing calls from uninsured makes much more business sense – which would pressure these people to make small regular payments. Your assumptions are not a priori true.

Just Isaac October 6, 2010 at 7:53 pm

As I explained the the post above, I think the situation would be more like current health insurance model. Health insurance companies do not run hospitals, they merely insure that your costs are covered. I bet what you’d really see would be independent local fire extinguishing services which charge a per incident fee, which you would then take to your home-owners insurance to cover.

J. Murray October 6, 2010 at 2:45 pm

Why do companies provide free samples of products and services? Successful companies aren’t guided by near-term profit and loss mechanics but long term sustainability. A firefighting outfit that refused to put out a fire it was standing in front of would not only lose the victim’s potential future business, but the business of others as well. This sort of behavior would be stood up by competitors in advertising campaigns aimed at stealing away business. Newspapers, television, and Internet ads would show the employees of Firefighting Company, Inc standing around while a fire burned, all followed by that deep voiced guy that does movie previews talking about how heartless that company is and that Fireblasters Ltd. wouldn’t let that happen.

Putting out the fire for an individual who hasn’t paid for the service, at worst, builds PR credit and could even convert the individual into fire protection service, even though the chances it would be necessary again is nearly 0%, ensuring a long-term profit for an immediate expenditure.

Sasha Radeta October 6, 2010 at 4:20 pm

J Murray,

Name me a single insurance business that makes a killing by providing its free services to uninsured.

As far as bad-reputation argument goes, this real world example is perfectly proving you wrong: the fire department showed-up on time and with an amazing precision controlled fire, protecting its customers, while letting a free-rider ride straight to flames.

It would be a great advertisement if it were a private company.

Phinn October 6, 2010 at 3:07 pm

See AAA for an example of how private fire services could work.

You can voluntarily pay a relatively low annual price for a certain amount of free or nearly-free emergency services. Or, you can go without it, and pay through the nose.

Only a governmental outfit would (a) show up at the scene, (b) refuse to put it out, and (c) refuse to accept any and all payments to take action.

Sasha Radeta October 6, 2010 at 4:23 pm

Phinn,

Nobody is willing and able to “pay through the nose” in the ghetto. Just forget it. The only solution there is to protect the insured, while increasing potential costs of not being insured.

Phinn October 6, 2010 at 5:31 pm

In the ghetto, nobody is willing to pay for all kinds of insurance. Paying for speculative, indefinable future contingencies is generally treated as a lower priority than food, shelter, electricity, clothing, transportation, telephones and immediate entertainment. I doubt you get a lot of AAA subscribers in ghettos, either.

What is your point? In your view, is this house-burning an issue of poverty or of the economics of fire response?

If it’s a matter of poverty, then I suggest that the US government’s monetary policies are the root cause. Even so, the best solution to poverty is not the collectivization of enterprises. Even direct welfare payments to the poor would less economically harmful than socialized fire responders.

If this is an issue of the economics of fire-response as applicable to everyone above the poverty line, then you haven’t addressed the fact that there are all kinds of private service companies that adopt variable pricing structures to give discounts to subscribers while still serving non-subscribers.

Sasha Radeta October 6, 2010 at 6:44 pm

Phinn,My point is that insurance business will not a priori provide its service to a non-insured household, regardless of the ability to pay. They will increase the number of ghetto subscribers only by making the cost of not getting insurance much higher (with probability factored in).People in trouble don’t have full-payment money in their pockets. Fire-houses would have to wait for their first payment, often never receiving one… It’s like saying that making loans to everyone in need, without any lending standard, would make a lot of sense in business.

J. Murray October 7, 2010 at 5:42 am

Well, duh, insurers are only a point payment organization. They don’t provide the actual service. It’s rare for an insurer to provide the service they’ve insured against.

Joshua_D October 6, 2010 at 2:25 pm

Putting aside the fact that this is obviously a government issue, not a market issue, why haven’t some libertarian writers used the example to reinforce the ‘moral hazard’ issue? And, if some already have, I’d appreciate it if you’d point me to the article. Thanks.

J. Murray October 6, 2010 at 2:46 pm

This only happened yesterday, give it some time.

Chuck October 6, 2010 at 2:35 pm

I don’t ever take pleasure in defending government services. But, is this really a matter of the failures of free market or government services? I feel that this is more an issue of contract. Its a terrible thing that that man lost his home. But I feel it’s open to speculation whether a private fire service would have acted on their morals and put the fire out…and then sent him
a bill. Firefighters risk their lives providing the services that they do. Shouldn’t they be compensated (at the least)? I’m
not so much trying to ignite a firestorm on this post as I am trying to understand how the free
market versus govt. argument is relevant in this case. Could someone please help me out?

Julien Couvreur October 6, 2010 at 4:57 pm

If you look at the threads on different sites, you’ll see that people are seeing this with a failure of “free-market”. The point of the above post is that this is hardly an example of free-market, since the municipal fire services are a government service (albeit with fees).

What do you mean by “compensated”? If you convince a firefighter to deliver his service in exchange for a slice of pie, a smile, or simply his inner satisfaction, then he is compensated.

Here’s the Slashdot thread btw: http://idle.slashdot.org/story/10/10/06/1332252/Firefighters-Let-House-Burn-Because-Owner-Didnt-Pay-Fee
Based on the story, I’m not surprised with the indignation, but it was a surprise to see the attack on the free-market. People see “fee” and they think “free-market”. We have a long road ahead of us…

Franklin October 6, 2010 at 5:18 pm

“…is this really a matter of the failures of free market or government services? …”
Kind of neither, Chris. To interject some boob-tube cynicism, since it was provoked by the statist actors, the matter is really a faux politico-discussion. It is an entirely transparent, infantile strategy of MSNBC to erect a straw man because they’re crapping their collective drawers that Tea Party types are going to “throw the bums out.” (If they had half a brain they’d not be worried about anything; the DC megalopolis ain’t going away during our lifetimes.)
This is theater and there might be more intellectual analysis on a SpongeBob Squarepants episode.
Ironically, an epithet is needed and one that doesn’t fly well for the compassionate conservative or for the establishment liberal:
“Shit happens and will happen, under both a free market and under the present regime.”
The un-News jockeys of cable yammering are intent only on saying, “Change the status quo and here’s what will occur!”
And there’s a nice kidney punch on the backend to also say, “See? Told ya what uncaring pigs those libertarians are. Figured that the Gordon Gekko con job couple years ago would’ve woken you up, but that was all funny money and Wall Street muckey-mucks a thousand miles away, huh? So now look. Look how this hits you at home. Really at home!”

Steve Gunn October 6, 2010 at 2:42 pm

2 Things:

As long as Olbermann is gonna use this poor guy’s suffering to boost ratings on his craptacular (that’s a technical term) “news” program, how about cutting a check and sending that out along with his oh-so-valuable “sympathy” ? Or is that just too much to ask?

And 2, Interesting to note that the only “private” company involved in this mess (the insurance company) is fulfilling their obligation without delay or circumstance… And here I thought that the insurance companies were supposed to be “EVIL”,right?

Strange how that works.

-Steve

Brian Bowman October 6, 2010 at 3:15 pm

The county was moving in precisely the direction Libertarians promote. No, it wasn’t all the way to perfection. But here is what they had achieved so far:

1. No coercion, no taxes. (Libertarian principles.)
2. Paid subscription. (an oft-proposed Libertarian solution.)

To omit that the county residents’ fire service was voluntary, no tax, no coercion—all libertarian ideals—is plainly disingenuous.

Furthermore, it is a rational business decision to deny services to Johnny-come-lately non-subscribers, just as private fire brigades let homes burn to the ground in the 18th and 19th centuries. Why?

1. Letting one house burn sets an example that brings in 1000 late subscriber fees.
2. Having mercy on just one late payer looses 1000 paid subscriptions, since many people would know they’d respond anyway.

Fiscal Example:
• On-site negotiated fire service, cost +50% profit = $1275
• Loss of 62 subscribers who decide they will just pay-on-site 62 x $75 = $4650.
• Penalty for an on-site negotiation policy = -$3375.

What company is going to risk steady cash flow by on-site negotiation? Well, some are, of course. But it is not a forgone conclusion that it would be a profitable business decision as you purport.

I think Libertarians need to face this Tennessee example more honestly. The county had, even if imperfectly as you point out, transitioned toward and implemented voluntary, no-tax, subscription-paid fire service. Those are free-market ideals.

To say different or ignore the fact that voluntary, no-tax, subscription-paid fire services are free-market ideals is to attempt to obfuscate the issue.

Daniel Hewitt October 6, 2010 at 3:27 pm

It’s not a perfectly statist system (100% collectivized), that is true. That does not mean it’s a libertarian system. It was a public fire department, for goodness sake.

Your comment may be more appropriate to leave on a conservative blog.

Brian Bowman October 6, 2010 at 4:01 pm

I am not a conservative. I am libertarian, so I’ll leave it right here, thank you very much.

As implemented for county residents, it was indeed a libertarian system.

1. Voluntary, no coercion, no taxes – 100% Libertarian principles.
2. Paid subscription service – 100% Libertarian solution.

Even if the fire department had been a completely private business, I don’t think the outcome for the homeowner would have been one iota different, especially considering the 19th century history of private fire brigades that let buildings burn if they did not have a “fire mark” on the building.

Jay Lakner October 6, 2010 at 4:07 pm

And if there were many private “fire brigades” in competition with each other, what would be the most likely outcome then?

Brian Bowman October 6, 2010 at 4:12 pm

From what I find at wiki:

In the late 19th century, the demand of central command for fire companies took place within cities because the fire companies would fight over fires or not put out an fire because the owners didn’t have fire insurance. Insured properties had plaques with the insurance company’s names affixed to their exterior called fire marks. This caused areas of a city to be badly damage by fires and caused many deaths.

http://en.wikipedia.org/wiki/Fire_brigade

Often fights would break out between the runners and even the responding fire companies for the right to fight the fire and receive the insurance money that would be paid to the company that fought it.

http://en.wikipedia.org/wiki/History_of_firefighting

Jay Lakner October 6, 2010 at 4:21 pm

I’m curious to know what government laws and regulations were in effect at the time.

Some sort of state intervention is virtually always the core problem of a failed system.

Matthew Swaringen October 6, 2010 at 5:36 pm

I read the wiki too, and what I found was interesting.

For centuries before the time you quote from it appears private firefighting worked, then mysteriously didn’t. This doesn’t give us nearly enough context to even guess why that would be, but why aren’t you questioning it yourself?

J Cortez October 6, 2010 at 5:46 pm

I would echo Jay Lakner. Usually if there’s a major problem with a market, it usually has a government component. Like the government outlawing certain types of competition, or creating a distorted incentives that sets people at each other’s throats.

Markets aren’t perfect, but they’re better than the alternative.

Also, the Wikipedia you cite is missing citation.

J. Murray October 7, 2010 at 5:45 am

Never come to a debate with a Wikipedia article. The historic record isn’t a democratic debate, which is what Wiki is.

J Cortez October 6, 2010 at 5:33 pm

In areas of the southwestern US affected by brush fires there are a few private fire companies that work in conjunction with home insurance. Everything works out fine and the home owners are pleased with the service.

J Cortez October 6, 2010 at 6:09 pm
Jay Lakner October 6, 2010 at 4:14 pm

I have a further point. In a free market, wouldn’t insurance companies have the greatest incentive to extinguish fires?
Wouldn’t it stand to reason that insurance companies would have their own fire emergency teams to deal with property they insure? Or at the very least, maybe as a requirement for an insurance policy they insist on a preferred private fire brigade?

If the state got out of the way, I’m sure we would see all sorts of unexpected clever ways to solve these problems.

Sasha Radeta October 6, 2010 at 4:31 pm

Brian used some great illustrations!

A profit-driven company may or may not decide to opt for “on-site negotiations” with uninsured. One cannot seriously claim that such tactic must make sense in areas with relatively low wealth and low number of subscribers.

Matthew Swaringen October 6, 2010 at 5:55 pm

Perhaps not, but if you have a monopoly it has little incentive to improve service because there are no rivals.

It isn’t wrong to say that the market could produce the same outcome. It is wrong to say that it must produce the same outcome, which is what Brian seems to be saying here.

To believe the market can never do wrong is to be utopian, but most anarcho-capitalists that I’ve read and followed here don’t believe voluntarism leads to utopia.

Daniel Hewitt October 6, 2010 at 7:06 pm

Brian,

I am not a conservative. I am libertarian

Then why are you inserting yourself into a debate between conservatives and liberals, over how a “public good” should be handled? Libertarians do not believe that this good (or sevice, I should say) should be public. Conservatives and liberals do, but they differ on the details. Let them fight over it.

Joshua_D October 6, 2010 at 3:27 pm

And, of course, most people discussing this issue seem to forget that fighting a house fire is rarely ever about ‘saving the house.’ Once a fire starts, you have maybe two to four minutes to put it out with minimal damage, maybe. After that, it’s more about preventing the spread of the fire to the next house. So, really, if you are paying for private fire protection, you won’t really be paying to save your house should your house catch fire, you’d be paying to help prevent the fire at your neighbor’s house from spreading to your house. Of course, I think that would be worth the fee, myself.

iawai October 6, 2010 at 5:16 pm

Fiscal Example:
• On-site negotiated fire service, cost +50% profit = $1275
• Loss of 62 subscribers who decide they will just pay-on-site 62 x $75 = $4650.
• Penalty for an on-site negotiation policy = -$3375.

Apart from comparing monthly fees to one time losses, your example also overlooks the fact that a privately run business can charge more than “cost+50%” – they may figure than they will lose a present value of $5000 of subscription fees, and should thus charge a $5000 premium above cost to put out the fire.

The problem with the actual Tennessee event, in the general opinion here, is that GOVT regulation prevented the fire from being put out. Whether there would be a similar policy in a private fire service is unknown – but you could always start your own fire service that had the policies you thought were more effective at meeting people’s needs.

Brian Bowman October 6, 2010 at 6:01 pm

I haven’t overlooked anything, I picked cost+50% out of the air. Go ahead, make it cost+500%. At some point, you price yourself out of the market.

Besides, if somebody can’t afford $75, do you think you can charge $1250? Or $5000? Or $10,000? And how do you imagine you’ll collect?

The history of firefighting shows that private company executives made exactly the same money-driven business decision as the mayoral executive – don’t put out the fire. Watching the house burn both preserves and increases cash flow:

1. If the fire brigade has mercy on fee-scoffers, the fire brigade will loose subscribers cash flow.

2. If the executive decides to lets it burn as an example, the company may well gain subscribers cash flow.

Letting houses burn isn’t theory. It isn’t a governmental conspiracy or incompetence. It is historically what private fire companies do. Why?

Hard-nosed, profit-driven business strategy.

Libertarians need to own up to the fact that this Tennessee example is exactly what Libertarians advocate. Voluntary, no-tax, subscription, fee-for-service fire protection. And what happened are the consequences.

Matthew Swaringen October 6, 2010 at 6:10 pm

You need to own up to the fact you are being arrogant about this. I don’t see any free market advocates in this discussion saying that this scenario is impossible. What we refuse to accept is that it’s necessity and that there aren’t better ways of running companies that people could find without the monopoly system that existed here.

Brian Bowman October 6, 2010 at 6:17 pm

Ok then, I’ll own up to it. I’m arrogant. Satisfied? I’m still right.

Nearly every, if not all, small towns of 2500 are going to have a “monopoly” fire brigade. Engines are expensive and you’re not going to find a competing firehouse on every corner, even in a perfect Libertopia.

And many of the private executives in a perfect Libertopia will do exactly the same thing – let it burn. It’s just a hard-nosed, profit-driven business strategy to preserve and increase subscription cash flow.

Matthew Swaringen October 6, 2010 at 6:40 pm

So in your Libertopia every insurance company or fire fighting agency is going to be based in individual towns? What wall is preventing outside companies from coming in and offering service? I understand your point about engines being expensive, but are you implying that there is only one way to put out fires and engines can’t be improved or built more cheaply or economies of scale can’t be used to reach out to relatively close communities?

Again, I don’t think people here are saying that the scenario is absolutely impossible in any case at all. What I think you are wrong about is this idea that this must be the outcome because the government monopoly outcome was this.

I also have to ask if you think this outcome is acceptable, because in my view it is. I’m not arguing that the outcome is impossible. I accept that someone could have their house burn down because they didn’t pay for insurance, I just don’t think it’s nearly as likely as you say.

Inquisitor October 6, 2010 at 8:37 pm

People should make a habit of not arguing with other people who just pull things out of their ass. You’re no “libertarian”. You’re just another statist, really.

J. Murray October 7, 2010 at 5:57 am

Garbage trucks are expensive, but the private carrier who picked up my trash when I lived in Tennessee retrofitted a container on the back of his F-250.

Those specialized fire trucks we see are the GOVERNMENT solution to the problem. Fire trucks are specially built machines that sell to city fire departments for an average of $780,000 per truck. I would operate a fire department using the aforementioned F-250s outfitted with tanks holding compressed ABC foam. I would likely only need 6. 6 of these trucks could be easily outfitted with the same volume of water as a fire truck and the rear tanks can be easily switched depending on the type of fire, such as the ABC foam tanks. The whole setup would run about $50k per truck, or less than half the cost of a single fire engine. Further, being nimble 4×4 vehicles, they could access places a fire truck could not and could arrive at the scene of a fire much quicker as they are able to take turns and accelerate much faster than a bulky fire engine.

This is just one example of how a private industry can do it better and cheaper. I’m no firefighter and have put very little thought into the subject (it isn’t an interest at the moment), so I bet there are others out there who could easily provide the same service for a tiny fraction of the public option.

Shama Lama Ding Dong October 7, 2010 at 9:16 am

There was a private fire dept. in Scottsdale, Az. that bought firetruck kits and put them together at a much cheaper price than buying the trucks ready to go.In this way the firemen were not sitting around being paid to do nothing. They also provided other emergency services.

PVW October 6, 2010 at 11:39 pm

I would like to propose a free market business model that resolves the issue of a non-payer. The fallacious assumption is that one needs to negotiate and pay before the service is rendered. Why would a private fire department not offer (among other contracting options) one that has these terms: (1) if there is never a fire, there is never a fee (2) if there is a fire, you will pay a certain fee which has a magnitude greater than other contracting options (e.g. it may be $X per square foot). Since the contract has zero cost – if there is no fire – those consumers who are poor, or prefer a high risk situation, could have there desires met by such a contract offered by an entrepreneur. The point is, no one could say “i couldn’t afford the cost of protection” – at least no more than they affirm by there choices that they could afford to loose their home.

Michael A. Clem October 7, 2010 at 10:25 am

As has already been pointed out, there is a certain hazard involved for private companies where the government creates uncertainty about their intervention. The real question at that point, then, is what is the best way to transition from government-provided services to privatized services? The “how” can make a big difference in what the market does.

Ohhh Henry October 6, 2010 at 4:21 pm

Heh. And I heard of a person once who didn’t pay for any fire insurance and because of that, didn’t get a cent of insurance money when his house burned down. Those blasted libertarians! He also didn’t pay anyone to fix his roof, and nobody came to fix it for him. If that is the kind of dog-eat-dog world that those crazy anarcho-Austrian euro-trash want to live in then they can go to the moon for all I care!

Phinn October 6, 2010 at 6:33 pm

>>Libertarians need to own up to the fact that this Tennessee example is exactly what Libertarians advocate. Voluntary, no-tax, subscription, fee-for-service fire protection. And what happened are the consequences.

Wrong. I advocate something fundamentally different — an economy in which there are no government enterprises crowding out the possibility of rival companies.

The existence of that county fire company fundamentally altered the economic system in this case. It altered people’s economic behavior. You can’t pick and choose which economic factors you are going to count and which you are going to ignore.

Brian Bowman October 6, 2010 at 6:49 pm

Phinn, could you do a market study and let us know how many fire stations a small rural town of 2500 population can economically support? Do you honestly envision there would be a rival brigades on every corner in the town square?

Would it work any better than the 1800′s when there actually were rival private fire departments (in larger cities?) Investors will want to know how you’d solve a long history of problems with rival fire brigades before sinking money into a second firehouse.

Matthew Swaringen October 6, 2010 at 7:09 pm

Brian, your best links on that history about the 1800s thus far was Wikipedia articles lacking citation. Now, I don’t think this makes them false, but they didn’t have a particularly huge amount of information on those times, what the laws were, etc.

Even if I accept your argument that there was at one time a problem of rival fire departments vying to do the same jobs and causing problems, how would one see that lasting? Would you the consumer buy a service from someone who was fighting while your home was burning? If you were running the insurance company, would you continue to business with the fire agencies that caused these problems?

The article’s tale is that things were bad and so the government had to come in to save everyone from the ills of private fire companies. You accept this tale despite being a libertarian. I have to ask, do you also accept that tale that the government tells that we must have a Federal Reserve to ensure that we don’t have business cycles? Do you accept the tale that we have to have drug laws or our streets will be full of addicts?

I’d like to know what is so magically different about the fire fighting industry that you imagine this history you’ve provided is all that’s needed to settle arguments.

I didn’t notice that I was planning on starting a fire fighting business or that Phinn was such that we are the entrepreneurs to answer questions for your investors. Provided that I was, I’d say that my insurance company (which pays fire agencies) wouldn’t pay anyone if there was any kind of fighting over business while property I insure is burning. I’d contract service out to them for certain regions of the city based on their rates and level of service. I wouldn’t allow 2 companies to cover the same area. When customers called my agents would call the company associated with the region of the city. If that company was unavailable, only then would my agents ask other companies to go in.

The 1800s was a much different time because you didn’t have phones and real-time communication capabilities that we have now. The problems with the 1800s are largely problems that wouldn’t exist now due to this.

Phinn October 6, 2010 at 10:22 pm

>>Phinn, could you do a market study and let us know how many fire stations a small rural town of 2500 population can economically support?

Sure, right after you provide me with the name of the town in the US in which the economics of its fire-response industry are wholly unaltered (in its past, present and reasonably likely future) by the existence of a governmental fire service.

I’ll need detailed information about this town’s population, demographics, including data on the distributions of incomes, education levels, occupations, years in residence, any seasonal changes in residential patterns, the ages of houses, sizes and types of dwellings, lot sizes, population densities, number of occupants per household, history of catastrophic fire-related losses, the existence of other fire-suppression technologies, and proximity to surrounding residents.

Oh, and I’ll also need a thorough legal analysis of the legal regime at both the state and county levels that might in any way affect the potential for either (a) annexation by any proximate governmental entity (as well as the current status and history of socialized fire response for that entity), and/or (b) the establishment of a new tax-based (i.e., theft-based) fire-response enterprise in the town in question. Either of these events, would, of course, displace or shut down any private company more or less instantly. Can’t have that.

The town in Tennessee in this news story doesn’t qualify as a candidate, since we already know that its fire service industry was obviously altered by the presence of the wholly governmental-and-therefore-non-libertarian county fire department, along with its arbitrary pricing and its arbitrary “let ‘er bun” policies, and thus it has inhibited even the potential for alternative service providers.

I suggest you start looking for this town in the State of Fantasyland, maybe nestled in the foothills of the Nonsuch Mountains, along the Fuggedaboutit River.

My point is that you have no more clue about the actual economic needs and opportunities for viable private fire service companies than you do about the history of fire brigades in the 1800s. Your unquestioning reliance on Wikipedia for your information might have been laughable, but it’s more of a sad joke. Nothing you’ve pointed to is even remotely an actual economic history of fire response; it’s a parable suitable for children — the Parable of the Failure of Private Fire Service.

And you swallowed it. I thought libertarians were supposed to be unusually capable of critical and logical thought.

Brian Bowman October 6, 2010 at 8:07 pm

Matthew, Things that make ya go hmmm….

You criticize “the monopoly system” and then you say “I wouldn’t allow 2 companies to cover the same area.”

And yes, I figure every small town that is big enough for a fire department is going to want its own fire department, instead of relying on “out-sourced” trucks coming 52 miles. Unless you can come up with an iPhone app that douses flames.

Inquisitor October 6, 2010 at 8:39 pm

As long as there is at any stage threat of competition/takeover, there is no “monopoly”.

Brian Bowman October 6, 2010 at 9:26 pm

You’re talking about a “coercive monopoly.” When there is one fire station in town, it’s a monopoly by common definition.

On your former post, you called me a statist. Ever hear of the sin of “bearing false witness?” You’ve broken it. Not a surprise for a nameless coward.

But I’m no sycophant.

Therefore, I am challenging fellow Libertarians who are attempting to distance themselves from a very Libertarian — voluntary, non-tax, subscription fee based — example of fire services.

The business strategy of “let’er burn” is one that many subscription based fire service executives would implement to preserve and increase subscription cash flow.

And that’s pretty much what the Republican mayor talked about in the video above – “incentives.”

Who is it that said “socialist economists neglected the role of incentives?”

Well, the citizens of Obion county are paying right close attention to the role of incentives — voluntary, non-tax, subscription fee based incentives.

Matthew Swaringen October 6, 2010 at 10:09 pm

Brian, you still haven’t answered a central question. Do you have a problem with the result that occurred here given your “admission of guilt” in being a libertarian (one who you believe advocates this presumably).

I don’t have a problem with the result, it’s really not that dire given that he didn’t pay for the service. On the other hand, I do think there are ways people would provide it contrary to what you say here.

Your definition of monopoly (a single company over a given area for a particular service) could apply to many services. I’ve heard people give this as a reason we need net neutrality, for example (the fact that some people have 1 ISP in town is supposed to mean there is no competition in their area).

No one denies that this kind of lack of product or service occurs in some areas at some times. Those who are more wealthy tend to get the advantages of new products/services first. In relation to some services, those who are in cities or tighter geographical areas get the benefit of competition sooner. But that doesn’t mean those in rural areas or those who are poor do not benefit and that there is no competition. There is always the possibility of takeover by outside agents.

Phinn October 6, 2010 at 10:47 pm

Therefore, I am challenging fellow Libertarians who are attempting to distance themselves from a very Libertarian — voluntary, non-tax, subscription fee based — example of fire services.

Again, you are wrong. You are leaving out ALL of the economic effects of having a governmental fire response enterprise operating inside the service area in which a potential private company might have operated, none of which you have addressed or apparently can address, including:

1. the subscription fee amount was entirely arbitrary and not based on economic reality, which is an unavoidable feature of all tax-based enterprises;

2. the policy of responding but then letting it burn was arbitrary and not based on economic reality, which is an unavoidable feature of all tax-based enterprises;

3. the existence of this county fire company, unhampered by concerns over economic reality, displaced all potential private solutions.

It’s impossible to refute these obvious facts. You’re certainly not even doing a particularly good job at trying.

But even if you could, then the alternative would be what exactly? Maybe the county could have chosen not to offer extra-jurisdictional fire services at all to this guy at any price. If so, the result is the same: the house burns down.

Or maybe they might have forced him to pay the fire tax? And what if he did exactly as he chose to do in this case — not pay it? Result: tax lien, foreclosure, seizure, sale at auction, and thus no house.

By the way, I once refused to pay for a pizza that I asked to be delivered to my house. Know what happened? I got no pizza. And I was really hungry, too.

Outrage! I DEMAND THAT ALL SELF-DESCRIBED LIBERTARIANS STOP THEIR IDOLATRY OF HAYEK IMMEDIATELY, AND EXPLAIN TO MY SATISFACTION HOW THE FREE MARKET IS GOING TO PROVIDE ME WITH PIZZA THAT I CHOOSE NOT TO PAY FOR!!!11!@ I AM THE ONLY ONE WITH THE COURAGE TO ASK THE TOUGH QUESTIONS!!!!1! DO WE REALLY WANT TO LIVE IN A SOCIETY WHERE THIS SORT OF THING HAPPENS??!?!?!?

Inquisitor October 7, 2010 at 6:34 am

“You’re talking about a “coercive monopoly.” When there is one fire station in town, it’s a monopoly by common definition.”

Nope, it’s a monopoly only if it does not face the threat of competition. Where did he mention “coercion” in his post?

“On your former post, you called me a statist. Ever hear of the sin of “bearing false witness?” You’ve broken it. Not a surprise for a nameless coward.”

Yes, because I don’t include some “name” that might as well be made up, I am a “nameless coward”. Ok.

“Therefore, I am challenging fellow Libertarians who are attempting to distance themselves from a very Libertarian — voluntary, non-tax, subscription fee based — example of fire services.”

Was competition allowed with the service? If so it is not libertarian. If it received financing again from the government, again it is not libertarian.

“The business strategy of “let’er burn” is one that many subscription based fire service executives would implement to preserve and increase subscription cash flow.”

Maybe. Some will, some won’t.

The fact that the government may take into consideration “incentives” does not thereby imply their programmes are non-socialist. They after all apply sin taxes with incentives in mind…

newson October 6, 2010 at 8:58 pm

the absence of compulsory fire insurance changes the shape of construction planned. maybe less use of flammable materials, less near-house foliage, more attention paid to safe-wiring would prevail without the fire safety-net.

compulsory insurance institutes moral hazard.

brian bowman’s questions are good. i’d hope to think this topic receives some academic attention from the libertarian side.

Inquisitor October 6, 2010 at 9:06 pm

It’s more so his assertions based on nothing but wikipedia without citations that are what strike me as fatuous.

Brian Bowman October 6, 2010 at 9:40 pm

Oh, how the character who got his name from a Monty Python skit hates the citizen’s media. Banish that knowledge! And all reading of apostate texts! Burn the heretic!

“I can see you’re really upset about this.” ~H.A.L. 2000

Inquisitor October 7, 2010 at 6:35 am

The word “Inquisitor” is not unique to Monty Python, it predates it; sources without any citations to back them up are not “knowledge” or “history”, so your comment borders on irony.

Mississippi Guesser October 6, 2010 at 9:15 pm

Why are firehouses and firetrucks the only possibility? To aid in putting out fires, we could have trucks, planes, helicopters, SuperSoaker10,000,000s. But we really don’t know because the market hasn’t been allowed to operate.

Iain October 6, 2010 at 10:12 pm

I find it interesting that no one cares to point out that as a responsible human being this man should be held accountable for his actions. He chose not to pay for the service. Should he get free TV because of the mental anguish he might suffer because he is unable to watch his favorite shows? He lost his house, yes, but silly people seem to be ascribing more value to such a thing than should be attributed to material possessions.

Matthew Swaringen October 6, 2010 at 10:13 pm

“Without citations” doesn’t equate to hating “the citizen’s media”

FlynJack October 6, 2010 at 11:56 pm

People forget that Libertarians are not only fiscally conservative, they are socially liberal as well. There aren’t many libertarians who would have stood by and watched a neighbors house burn down. A libertarian mayor would have had the fire department put out the fire and send the man a bill for the 75 bucks.

Brian Bowman October 7, 2010 at 4:24 am

Why pay if they’ll spray anyway?

If the brigade puts the fire out for $75, they’ll loose subscribers. That is the business reality of private fire brigades, proven through 19th century history. And why communities did away with them and went to a universal property tax-based system.

Non-payers put everybody else’s homes and businesses at risk.

Inquisitor October 7, 2010 at 6:28 am

Based on a source with no citations, no further context, nothing. So why should anyone take it seriously?

Brian Bowman October 7, 2010 at 8:46 am

I referenced wiki. You have provided no other contrary references. Somehow, I don’t think you’ll accept the facts of history that you don’t like.

Inquisitor October 7, 2010 at 10:44 am

I am not obliged to provide contrary references to a source with no support for it and very vague commentary by a biased government party. You’re making the contention, you support it.

Anonymous October 7, 2010 at 6:37 am

“People forget that Libertarians are not only fiscally conservative, they are socially liberal as well. ”

Says whom?

No matter how many times you leftists repeat this mantra, it’s not going to make it true.

Social liberalism leads invariably towards large states and invasive laws.

Egalitarianism is a revolt against nature.

Brian Bowman October 7, 2010 at 4:21 am

The Libertarian evasion about the consequences of their policies, however imperfectly implemented, is as intellectually dishonest as communists claiming that communism isn’t what failed in the Soviet Union.

The evasion includes:

1. Obion County had a Libertarian fire service policy. Voluntary, no-tax, subscriber-fee — all Libertarian ideals.

2. The executive decision to the the non-subscriber’s house burn is incentive-driven. It is a profit-driven business decision made to both preserve and increase subscriber fees.

3. This is how private fire departments have acted throughout the 19th century history of private fire departments. And why private fire departments have been eliminated.

scineram October 7, 2010 at 5:24 am

You dishonestly assume what happened was a problem.

Brian Bowman October 7, 2010 at 5:40 am

What precisely is dishonest about perceiving a problem with a fire brigade not responding to a fire?

Libertarians are distancing themselves from this instance, because most everybody sees it as a problem.

But you don’t see any problem? Then embrace the suck, wrap your arms around it. Kiss it right on its Hot Lips, Houlihan Scineram.

Inquisitor October 7, 2010 at 6:27 am

Why is it one?

Brian Bowman October 7, 2010 at 6:34 am

If you don’t think what happened is a problem, then I suggest you advise Mr. Tucker to embrace and trumpet the example of what happened as a free-market tough love, tough shit lesson for people who won’t take personal responsibility to pay their fees.

Phinn October 7, 2010 at 6:48 am

A. It’s not.

B. How is it any different than what happens every day with municipal water supplies — one government-run company is the only vendor available, you pay your bill “voluntarily,” and if you don’t pay then they forcibly turn off your access to an essential economic good (water)?

Inquisitor October 7, 2010 at 8:16 am

It not being a “problem” does not imply there aren’t other aspects of the situation that are not a problem…

Phinn October 7, 2010 at 6:24 am

>>1. Obion County had a Libertarian fire service policy.

Wrong, again, and right off the bat. It was a monopolistic, government agency. Therefore it is not an example of a free-market enterprise.

When people cannot freely exchange private property, they do not have the ability to engage in ECONOMIC CALCULATION. That didn’t exist here. Wrap your head around it.

I’m getting the strong feeling that you do not know what “economic calculation” means, because you have not read books like Human Action and others, which contain principles to which this website and Mises Institute are dedicated.

Brian Bowman October 7, 2010 at 6:36 am

I’m getting the feeling you are once again evading the simple fact:

Obion County fire service, for county residents outside of town, was voluntary, free-market, no-tax.

Obfuscate all you want. You’re like the communists who deny communism destroyed the Soviet Union, just because the communism was not perfectly implemented.

Phinn October 7, 2010 at 6:57 am

It makes no difference whatsoever what Communists think destroyed the Soviet Union. The only thing that matters is the truth. The truth is that the root cause was the Calculation Problem.

Which happens to be the same cause of the problems with governmental enterprises, including government fire agencies, even though there are some minor, trivial differences between Obion County’s fire agency and the Soviet Union.

Brian Bowman October 7, 2010 at 8:43 am

I don’t think the Soviet Union had a free-market, voluntary, no-tax method of fire service like Obion County.

Now if you think a county that has a free-market, voluntary, no-tax subscription service to fire protection is only trivially different than the Soviet Union, then we disagree.

You are trivializing that the county had moved significantly to a Libertarian model of fire protection.

Phinn October 7, 2010 at 9:22 am

Yes, I am trivializing it because your point is trivial.

This governmental agency gave tiny fraction of its customers the option not to pay in exchange for not getting services, but the vast majority were required to pay, under threat of foreclosure and seizure of their property. That makes it a true-blue, collectivized, socialized, government monopoly.

The very existence of such an agency has broad, long-term, negative economic effects that you either do not have the intellectual ability comprehend, or you choose not to acknowledge them for psychological reasons.

Inquisitor October 7, 2010 at 6:39 am

“1. Obion County had a Libertarian fire service policy. Voluntary, no-tax, subscriber-fee — all Libertarian ideals.”

Not if it does not allow competition with it and not if it receives a single dime from the government.

“2. The executive decision to the the non-subscriber’s house burn is incentive-driven. It is a profit-driven business decision made to both preserve and increase subscriber fees.”

Is the fire brigade privately owned? Will its owners suffer losses for poor business decisions? Can it be forced into bankruptcy? Can they sell it off? The fact that it considers “incentives” doesn’t make it either economically sound or “libertarian”.

“3. This is how private fire departments have acted throughout the 19th century history of private fire departments. And why private fire departments have been eliminated.”

You never proved it.

Brian Bowman October 7, 2010 at 8:39 am

I quoted wiki, and you’ve quoted nothing. I suspect you wouldn’t accept facts of history you don’t like.

Prime October 7, 2010 at 10:47 am

Private fire departments have not been eliminated.

The Kid Salami October 7, 2010 at 4:46 am

” The executive decision to the the non-subscriber’s house burn is incentive-driven. It is a profit-driven business decision made to both preserve and increase subscriber fees.”

I don’t understand. What does this mean?

Brian Bowman October 7, 2010 at 5:33 am

It means cash flow. The profit driven motive to let the house burn is two-fold, preserving present cash flow, and increasing cash flow.

1. If the fire brigade has mercy on non-subscribers, the fire brigade will loose subscribers cash flow. (Why pay if they’ll spray anyway?)

2. If the executive decides to lets it burn as an example, the company may well gain subscribers cash flow.

The economic incentive of cash flow is explicitly stated on TV segment above, using an insurance industry model to explain. Why won’t insurance companies sell you insurance when your house is on fire? See 1 and 2 above.

The Kid Salami October 7, 2010 at 5:59 am

You;re saying a private fire brigade would (likely) not have mercy on non-subscribers. Probably most of the time yes. What exactly is your problem with this?

J. Murray October 7, 2010 at 6:18 am

This assumes that only the subscription model exists. That’s the problem with the arguments against the private fire fighting service, all of them base the entire argument on a very specific business model and attack that as the only alternative to the public version. It’s a classic straw man.

Why would it have to be subscription based? Wealthier individuals would unlikely buy a subscription fire protection service. Decisions to take on a subscription model or a pay-per-use model is a cash flow consideration.

For example, I don’t have dental insurance, which is effectively a dental service subscription as few dental insurances don’t pay for preventive visits. Since I know that I can easily afford any dental procedure out of pocket and I also know that insurance is, by it’s nature, a net money loser to the policy holder, I have little incentive to purchase dental insurance. It’s a waste of money because I’ll always put more into premiums than I’ll ever get out.

On the flip side, I hold automobile insurance and would even if it were no longer a legal requirement. While I can easily afford the $50 out of pocket every 6 months for a cleaning, I can’t afford to just pay out another $30,000 to purchase a new vehicle should this one be destroyed. Even though I still know that the insurance is a net money loser, it’s better to have it as I cannot just drop $30k on demand.

The same would go for fire protection. Those who have low cash flow would opt for the subscription model while wealthier folks could afford the higher point of service fee. Both individuals have roughly the same, remote, chance of ever needing to use the service, but different people have different cash flows.

Further, the argument also assumes fire fighting service would be solely a for-profit industry. A not-for-profit system can also form that focuses on servicing poorer areas that couldn’t otherwise afford the fire protection services. Not for profits are a thriving concept in the United States and offer a range of services from medical care to construction of homes. Charitable donations are substantial in this nation and between the combination of elimination of the tax burden and the improved efficiency of privatized services, charitable giving to a not-for-profit firefighting service would likely be sufficient to perfom just as well, if not better, than the current system.

There is even the possibility of spontaneous community organization of volunteer fire fighters. By spreading out the firefighting capability to small groups of volunteers in communities, most fires could be stopped long before they get out of control where calling in an outside service would become necessary. If Frank three doors down could be called in to handle an electrical fire, it would mostly be contained to the source. But if the same electrical fire relied on a fire department, the house would be ablaze by the time it arrived. It wouldn’t matter if the service was public or free-market, distance and time cannot be regulated away.

This is just scratching the surface. Just remember the immortal words of Frederic Bastit.

Brian Bowman October 7, 2010 at 6:26 am

Libertarians do advocate the subscription business model for free-market fire protection. I’m not assuming subscription is the only model, so the only straw man builder is yourself.

J. Murray October 7, 2010 at 6:53 am

What? You’ve just created a broad term for an entire political ideology and decided all of them promote a subscription-based system only. That’s the straw man. I propped nothing up other than the observation that the entire argument against private fire protection hinges on a 100% subscription based system.

Brian Bowman October 7, 2010 at 8:37 am

You’re the one creating the straw man. I never said subscription is the only model that libertarians advocate. But it is indeed one of them.

J. Murray October 7, 2010 at 10:50 am

Then why base the entire argument on it?

Brian Bowman October 7, 2010 at 6:21 am

My problem with how a non-subscriber was treated in a voluntary, no-tax fire service system that yielding to the free-market incentive of preserving cash flow is two-fold:

1. Anybody who has functioning mirror neurons in their brains — those things that make you feel empathy — has feelings of revulsion at seeing a fire department ignore a man’s house on fire.

2. The 19th century’s lessons of free-market fire brigades demonstrates the risk of fire spreading to neighbors, even if they have paid their fees.

Inquisitor October 7, 2010 at 6:29 am

“1. Anybody who has functioning mirror neurons in their brains — those things that make you feel empathy — has feelings of revulsion at seeing a fire department ignore a man’s house on fire.”

Tough. I have feelings of “revulsion” about dogs. It doesn’t follow I think no one should own one or they should all be put down.

“2. The 19th century’s lessons of free-market fire brigades demonstrates the risk of fire spreading to neighbors, even if they have paid their fees.”

Unproven assertion.

Brian Bowman October 7, 2010 at 8:35 am

Mirror neurons are not about revulsion, they are about empathy. If an other person expresses revulsion, your mirror neurons (unless you are autistic and have a crippled sense of empathy) help you feel the same emotion. Or whatever emotion the other person is expressing in facial expression.

Unproven? Well, I referenced wiki. Have you any objection to wiki’s interpretation of history, other than you don’t like the facts of history even if they are true and found in better references?

Inquisitor October 7, 2010 at 11:02 am

“has feelings of revulsion at seeing a fire department ignore a man’s house on fire.”

You’re the one who mentioned it, not I. And I never even alluded to mirror neurons…

The Kid Salami October 7, 2010 at 7:17 am

“2. The 19th century’s lessons of free-market fire brigades demonstrates the risk of fire spreading to neighbors, even if they have paid their fees”

Yes – and people don’t bother thinking about the this when they buy a house why? Because they know that if there is a fire in their neighbours house, a fire putter-outer will appear as if by magic, for free (not actually for free but apparently for free), and put it out.

Remove this free service and, instead, they WILL think about it. People building houses will think about what the buyers will be thinking about etc.

Unless you go beyond the “seen” and think of the “unseen” you will continue to misrepresent what libertarians are advocating and not understand the situation.

Phinn October 7, 2010 at 7:27 am

Ah, yes! You have a superior sense of empathy! Lovely! Let’s see what your “empathy” really consists of and how far it goes.

1. How many times have you paid for the fire services of people who can’t afford it? Please describe in detail every payment you have made for such people, including their names and addresses so your empathy can be verified.

2. How many low-cost fire response companies have you started? Please give us the name(s) of these companies, and your books and records to show how you have managed to provide this service at low or no cost to people in need.

3. How many house fires have you personally extinguished for free? Provide documentation.

4. How many houses have you personally built for people whose house was destroyed by fire when no fire-response company would put it out. Provide names and addresses and photos of your actual labor in progress.

You haven’t done any of these things? I see.

So, your “empathy” extends only to typing ignorant crap on websites, pretending to be a concerned libertarian (i.e., you’re a Concern Troll), and advocating in favor of the crime of collectivized fire service, which has not only been proven to lock people into accepting an inferior service at an excessive cost, but comes with the added feature of stealing from the most thrifty, hard-working, sensible and responsible people in order to pay for the costs of people who choose not to pay for the goods they receive.

That’s what “empathy” means to you — freely spending other people’s money, and destroying the economic mechanism that would prevent or reduce the very problem you claim to be fixing.

Your sense of ethics is as feeble as your sense of economics.

Brian Bowman October 7, 2010 at 8:03 am

The reason I mentioned empathy is that is what people feel when somebody feels bad. It’s basic science now that we know about mirror neurons. [scholar.google Mirror+Neron+Empathy if you want to see peer reviewed articles]

And I’d guess empathy is why Mr. Tucker has not taken the stand that the Tennessee homeowner is an example of a slacker who got his just deserts.

You are telling lies about me, stating that empathy means freely spending other’s money. No, I haven’t said that. I doubt you’ll apologize, but maybe you will.

I’m a Libertarian critiquing the denials I percieve in this situation. If you don’t like that, and think everybody should be some yesman, then tough.

I’ve brought some thoughts into the conversation that people have stated they appreciate, so thank you very much.

Inquisitor October 7, 2010 at 8:19 am

The fact that one “emphathises” with this person does not imply either that the service in question is “libertarian” (as I noted, there are multiple questions concerning the fire department’s ownership status) or that a free market institution would necessarily act this way. You are insistent this is a libertarian scenario but have offered no evidence for that contention…

Brian Bowman October 7, 2010 at 8:29 am

Voluntary, no-tax are libertarian principles.

Subscription based fire service is off-used libertarian solution.

It is appropriate to say the fire department in Tennessee was following free-market, libertarian principles — voluntary, no-tax, subscription based — even if the ownership facet of the department is still governmental.

Phinn October 7, 2010 at 9:13 am

>>Voluntary, no-tax are libertarian principles.

For the 80th time, no it is not.

Free-market principles require that the government refrain from creating a monopolistic, tax-based service enterprise in the first place, since doing so prevents private alternatives from ever coming into existence.

That is the root cause of the problem here. It’s not the guy’s failure to pre-pay the fee, or the county’s decision to charge the fee, or its decision to allow people not to pre-pay the fee, or the firefighters’ refusal to put out the fires of non-payers, or even their refusal to accept a larger fee to work for a non-payer.

The root of the problem occurred far earlier — when the government entity in question created a monopolistic tax-based fire service company, thereby excluding all alternatives, and trapping everyone in its service area into either accepting its monopolistic terms of service, or make do without.

You have failed to think deeply enough. You have failed to trace the root problem back to its actual source. You have failed to account not only for what actually happened, but also account for what could have happened (but didn’t) because of the government’s decision to create a tax-based, non-market fire response agency.

You have also failed to explain the difference between this fire department situation and pretty much every government-run electricity and water service company in America, which are (a) government-sponsored monopolies, created, funded, exclusively licensed or otherwise protected from any potential competition, (b) charge fees for their goods and services rather than mandatory taxes, and (c) turn off their services when you don’t pay.

Explain how these public utility companies (which operate exactly the same way as the County Fire Department in Tennessee )are examples of libertarian principles.

Brian Bowman October 7, 2010 at 9:41 am

|| Voluntary, no-tax are libertarian principles.
| For the 80th time, no it is not.

Yes, I understand the fire department was not yet perfectly libertarian.

But the county had transitioned from a socialist model, where everybody pays taxes for fire protection, to a more libertarian model, where service was voluntary and not assessed by taxes.

Even Mises recognized the US as more free and libertarian and successful than the Soviet Union. Even though the US economy is by no means perfectly libertarian.

Are you going to contradict Mises and me by claiming “oh no, the US and the fire department are not perfectly the way I want them, so for the 80th time you can’t say they are more libertarian and free?”

Mises recognized a continuum between totally free and total tyranny. The Soviet Union nearly total tyranny. The US was more towards the free end of the continuum. Mises said that is why we were more successful.

Well, the fire department had moved significantly towards the free side of the continuum.

J. Murray October 7, 2010 at 9:48 am

It didn’t move to the free side. The matter of whether you want to use that specific one or not or the matter of pay-for-use is not what makes a free business. That’s just superficiality. Freedom is being able to enter into the market and not compete with a subsidized service. Do you think that fire department is actually self sufficient by charging a few thousand people $75/year? Not on your life.

There isn’t a meaningful choice in the matter. It’s either the government’s solution or nothing. The continuum hasn’t moved, all we have is the statist model dolled up like some free-market Frankenstein’s monster.

Phinn October 7, 2010 at 9:54 am

Of course there’s a continuum. There are degrees of more free and less free.

The point I (and others) have been making, which you have refused to address, is that the “step” in the direction of making Obion County’s Fire Department more free was trivial.

It was trivial in comparison to the broad, long-term economic effects of the 99.9% of Obion County’s Fire Department operation that has historically been and remains to this day completely un-free and socialistic. That part includes the vast majority of its “customers” who do pay via taxation, plus all the other forms of monopolistic governmental sponsorship that it enjoys.

But it takes some intelligence and education to even be able to see what most people fail to see. They don’t see the absence of private fire company alternatives, because they do not exist, because the governmental agency displaced them. So, they assume they could never exist, and fail to account for them. (Read Bastiat’s Broken Window pamphlet, please.)

They don’t see the technologies that would have been economically viable, and thus developed and deployed (like J. Murray’s excellent idea of using retro-fitted F250 trucks to deliver foam, rather than monstrous government fire engines), were it not for the existence of the socialized, governmental agency that displaced all of the private alternatives.

You have also still failed to explain how governmental utilities are equally “libertarian” in nature, which operate just like this County Fire department does (as to its extra-jurisdictional customers, at least), by displacing all private vendors, allowing voluntary payments, while also turning off service when you do not pay.

Brian Bowman October 7, 2010 at 10:06 am

Again, Obion County’s move from completely socialistic fire service to voluntary, no-tax, free-market subscription service for county residents is hardly trivial.

Unless you think the differences between the Old Soviet Union and the US are trivial.

I suppose it would take a sort of “education” to proffer such sophistry.

Phinn October 7, 2010 at 10:13 am

Yes, it’s trivial.

The government in this case gave a small fraction of the people who were inside the service area of its fire trucks the option not to pay, most likely because they were located outside of its city tax authority district and couldn’t force them to pay without annexing them. Otherwise, it was wholly socialistic.

That socialistic arrangement gave this governmental agency the political power to dictate its terms — pay in advance, or we let it burn.

It also displaced private alternative companies, and displaced private technologies.

Still waiting for you to tall us why governmental utilities are examples of free-market enterprises.

Brian Bowman October 7, 2010 at 10:29 am

Asserting that the difference between the Soviet Union and America is trivial and between a socialistic and a voluntary, no-tax, fire service is trivial is, well, trivial in my opinion.

On the utilities thingy – you brought it up, not me, so I’ll let you knock it down. Don’t get any straw down your neck.

Phinn October 7, 2010 at 10:35 am

You said, “Obion County had a Libertarian fire service policy.”

I said that if that’s true, then all of the public utilities in America must also be “Libertarian” in nature.

Please explain how these public utilities are “Libertarian” in nature, considering that they also monopolize their respective services through government sponsorship, charge voluntary fees, and turn off services for non-payment.

Brian Bowman October 7, 2010 at 10:46 am

Are they voluntary? Free-Market? Not paid by taxes but by choice? Are there economic incentives to use only what you need? Or are those only trivial considerations? And was Mises observation between the Soviet Union and the United States, however imperfect the US may be, a trivial impression?

Phinn October 7, 2010 at 11:03 am

No, public utilities are not free-market.

They are not free-market because no one can enter the market and offer rival services. They are protected, sometimes by outright dictate, and sometimes by benefiting from special legal privileges and subsidies.

That’s an essential part of what “free market” means — the freedom to enter the market as a producer/vendor, and solicit customers from pre-existing businesses.

One of the main ways that markets become un-free is for governments to erect various kinds of BARRIERS TO ENTRY, which prevent or inhibit potential producers from forming or succeeding.

Brian Bowman October 7, 2010 at 3:41 pm

Nobody makes me pay any price for electric. I’m free to choose. And last I knew, competitors are moving in on the public utilities like flies on a cow pie. An electrician I know can hardly keep up with wind generator towers. The only barrier to entry is the old geezer who runs the crane doesn’t want to work more than 10 hours a day. Got a crane?

Phinn October 7, 2010 at 7:31 pm

>>The only barrier to entry is the old geezer who runs the crane doesn’t want to work more than 10 hours a day. Got a crane?

You clearly no absolutely nothing about the “public” (i.e., socialized) aspects of “public” utilities.

There’s a reason that every U.S. state has a whole chapter or two of their statute books devoted to the creation and control of utility companies, followed by thousands of pages of regulations. If they were set up so that the ordinary rules applicable to all market-based transactions applied equally to utilities, then state and local governments could have saved themselves a lot of time and paper.

If you are in favor of socialized utilities, just say so. You’d prove you’re no libertarian (as if any more proof were needed), but at least you’d be honest.

Brian Bowman October 7, 2010 at 9:06 pm

To me, libertarian is “a person who believes that no one has the right, under any circumstances, to initiate force against another human being for any reason whatever; nor advocate the initiation of force, or delegate it to anyone else.”

That’s me.

Now, I don’t attend your passive/aggressive church of public utility straw men and help you set them up and knock them over. Those rituals are your own. I hope you enjoy them.

Phinn October 7, 2010 at 10:56 pm

The collection of taxes is the initiation of force.

Preventing people from starting a private utility company to compete with a state-sponsored monopoly utility company is the initiation of force.

Brian Bowman October 9, 2010 at 3:03 am

Nobody is collecting taxes for fire protection from the county residents outside the small village.

Brian Bowman October 7, 2010 at 9:21 am

A couple of my detractors have questioned the reference to historical facts about firefighting because I sourced only wiki.

Fine, I’ll do some homework. Here are some web-available references that corroborate at least some of the wiki information:

Members of the fire company pledged …Members were not required to help protect properties of non-members.

The company adopted “fire marks” to be affixed to the front of the insured’s property for easy identification.

Since the beginning of organized firefighting in the U.S., it became obvious that centralized command was needed – someone would have to take charge and coordinate the efforts of those attacking the fire, salvaging goods and preventing fire extension. In 1711, the City of Boston took steps to control the chaos that occurred during a fire and better organize the attack against the flames.

The above excerpts are from Paul Hashagen, a fire service historian and author of several books about the history of firefighting. He is an FDNY firefighter assigned to Rescue Company 1 in Manhattan and an assistant chief of the Freeport, NY, Fire Department.
http://www.firefightercentral.com/firefighter_history.htm

Phinn October 7, 2010 at 9:29 am

Great — a government employee writes a tale extolling the virtues of government employment.

Yeah, I’ll get right on that.

Brian Bowman October 7, 2010 at 9:43 am

Oh, you’re quite the principled scholar. Going to throw away everything by Thomas Jefferson?

J. Murray October 7, 2010 at 9:49 am

Logical fallacy – appeal to authority. Try again.

Brian Bowman October 7, 2010 at 9:57 am

Did you ever write any papers in college? Did you include “References” or did you write “Appeals to Authority” in the paper? I’m just wondering which terminology you employed. Thanks for letting us know how consistent you really are about referencing material.

Phinn October 7, 2010 at 10:06 am

This isn’t college. This is real life. I’m guessing you’re pretty young, if you think the standards applied to students are meaningful in the real world.

Out here, demonstrating that you know how to use a library doesn’t get you approval from a parent-surrogate. Out here, the only thing that matters is truth (i.e., reason and evidence).

Brian Bowman October 7, 2010 at 10:10 am

I didn’t think Libertarians acted like conservatives or liberals when presented with historical facts that they don’t necessarily like. Guess i was wrong.

Phinn October 7, 2010 at 10:26 am

You have presented no history, and certainly demonstrated no logical reasoning. You have cited a book written by an author with obvious biases, and tried to pass it off as though you were making an argument.

You’re not even making a bad argument; you’re making no argument at all. You’re just engaging in the mental masturbation of confirmation bias.

You might as well go back to relying on unsourced Wikipedia articles and Martin Scorsese movies.

J. Murray October 7, 2010 at 10:33 am

There is a difference between a reference and telling us that so-and-so said it, therefore it must be true. Making the statement “Going to throw away everything by Thomas Jefferson?” is attempting to build credence to an idea by simply mention an individual’s support for it. It also works in the reverse by mentioning an unsavory individual who supported an idea (eg Joseph Stalin said it was a good idea to brush and floss after each meal, so we shouldn’t do it becuase Stalin is a bad person). Who said what makes no difference, only the content of the information matters.

Quotations are only used for purposes of being able to portray your idea without having to reinvent the literary wheel. Why try to come up with an elegant way to say something when someone else already did it? Referencing is just to give due credit to who came up with it, nothing more.

Brian Bowman October 7, 2010 at 3:11 pm

Ya’ll are a bunch of non-reference-finding weenies. Me: I find ‘em. You hate ‘em, and you piss and moan. Well, there ya go. I mean, when a fellow finds a fire historian who is also a NYPD fireman, who corroborates what I found on wikitruth, you could at least have the common courtesy to say “thanks, I’ll consider it.” But noooo…..

Got any references, boys?

Phinn October 7, 2010 at 9:56 am

Yes, I am a principled scholar — I read critically, with an eye toward the author’s biases, careful not to allow the confirmation of my own biases to become a substitute for truth.

Brian Bowman October 7, 2010 at 9:59 am

Well, goodie gum drops. Does his bias mean he misled us about fire marks being used on buildings? Or do you think blanket smears are scholarly?

Phinn October 7, 2010 at 10:03 am

Critical Thinking 101: His bias means that his selection of facts to include in his history, his decisions to exclude other facts, his explanations of causes and their effects, and his ultimate conclusions must all be questioned and tested, rather than blindly accepted as truth merely because they make us feel good.

Brian Bowman October 7, 2010 at 10:08 am

Again, where are his facts wrong? Or are your “scholarly” smears sufficient to dismiss historical facts that are uncomfortable to you?

Phinn October 7, 2010 at 10:18 am

I am not required to spend the time and energy to discover where his facts are wrong.

It’s up to you to glean whatever verifiable facts and sound reasoning you can from his book, subject them to rigorous verification and testing, and present an argument based on the ones that you feel meet these standards.

Otherwise, you’re just pulling random crap down off the library shelf and expecting it to do the heavy lifting for you.

Brian Bowman October 7, 2010 at 10:22 am

Paul Hashagen, a fire service historian and author of several books about the history of firefighting, FDNY firefighter assigned to Rescue Company 1 in Manhattan and an assistant chief of the Freeport, NY, Fire Department is random crap?

Keep those scholarly smears going there. They’re shiny.

Phinn October 7, 2010 at 10:30 am

Yes, it’s random crap until proven otherwise.

Still waiting on your explanation of how public utilities are examples of free-market enterprises, when they monopolize services, charge voluntary fees, and turn off services for non-payment.

Inquisitor October 7, 2010 at 10:39 am

The writer is not a disinterested party, and the bits you provided do not furnish us with nearly enough details to even come near to proving your point. Hence the source is dismissed.

Brian Bowman October 7, 2010 at 10:42 am

On the subject of utilities that intensely interests you – I didn’t bring it up. You did, so you knock it over yourself. Enjoy.

Phinn October 7, 2010 at 10:50 am

I already did knock it down.

You claimed that the Obion County Fire Department’s treatment of extra-jurisdictional subscribers is “Libertarian,” but I showed that it is no more “Libertarian” than public utilities that have the very same pricing and service policies.

I was giving you multiple opportunities to respond substantively, or to concede the point, and thereby perhaps rescue some of your rapidly-fading dignity.

Brian Bowman October 7, 2010 at 1:39 pm

If my dignity fades out completely, I’ll refrain from posting under my full name. Just like you.

Prime October 7, 2010 at 10:52 am

Your statement regarding fire marks seems to be false, too.
They were provided for a number of reasons, none of which had to do with whether or not a fire would be put out.
http://www.firemarkcircle.org/documents/goodstory.htm

Brian Bowman October 7, 2010 at 1:43 pm

Thanks for digging up good info. It seems to contradict the NYFD historian I found, but I suppose everybody has a bias.

Greg October 7, 2010 at 10:08 am

Without a market, how can we even tell if firefighting is a worthwhile endeavor? Do firefighters save money and resources, or are they a net drain? You cannot answer this without a market. It’s a calculation problem. With advances in housing materials, we are much more able to build houses that are resistant to fire. It sucks for the person whose house burns down, but if our current socialized firefighting system is a net drain, then we would all be better off just buying that person a new house. Doing some cursory research, it appears we spend on the order of $100B a year on firefighters and we suffer about $10B in damage.

Brian Bowman – If you’re truly empathetic towards these people, why don’t you support a system where we put all the money we were spending on firefighting into an account and give everyone whose house burns down a new one, along with some extra cash to throw around? They’d be better off than being stuck with a half-burnt house as they are now. You must be some kind of sociopath to want to keep our socialized fire system intact.

Brian Bowman October 7, 2010 at 10:18 am

Greg, I brought up the concept of empathy to explain a possible reason why Mr. Tucker is shying away from this example of a voluntary no-tax fire department, when he could just as easily use it as an example of what happens to freeloading slackers.

I did not use the concept of empathy to argue for socialism. I’m libertarian “who believes that no one has the right, under any circumstances, to initiate force against another human being for any reason whatever; nor to advocate the initiation of force, or delegate it to anyone else.”

Will you apologize for bearing false witness against me?

Greg October 7, 2010 at 10:25 am

Mr. Tucker is shying away from this example? I don’t understand what you’re saying. He posted this on a blog. That is hardly shying away.

And exactly how did I “bear false witness”? Have you not spent the last 100 posts trying to make the point that in the case of fire prevention, the free market system is flawed, and thus we must not use a free market system?

Brian Bowman October 7, 2010 at 10:36 am

I am challenging the fallacy of Libertarians who are attempting to deny, to shy away from, the perception that the Tennessee no-tax, voluntary, subscription based fire service was based on Libertarian principles and Libertarian proposed solutions to socialized fire services.

I am challenging the fallacy that letting the house burn was purely governmental error. It was not. It was a profit-driven business decision to retain and increase subscription fee cash flow.

But I figured I’d get called names and things would be twisted against me. That’s the nature of debate.

Inquisitor October 7, 2010 at 10:40 am

You’re challenging people to come to the defence of your strawman, then bewail the fact that people call you out on being disingenuous? Poor baby.

Greg October 7, 2010 at 10:53 am

Do you know of a libertarian who proposed this as a solution to socialized fire service? I can’t imagine any libertarian would think that this system would work. Introducing the concept of paying for a good/service does not a free market make.

“It was a profit-driven business decision to retain and increase subscription fee cash flow.”

Business decisions can only be made by businesses. The government agency in charge of putting out fires in this area had incentives much different than a standard business. Without the profit/loss mechanism, the threat of losing one’s job, etc., they cannot be expected to act as a business would. Also, how do you know what was in the mind of another person when this decision was made? For all we know, the guy whose house burned down had boinked the wife of the guy who made the decision to let his house burn.

Gil October 7, 2010 at 11:04 am

Marcus Crassus’s idea for a private firefighting business was much worse. However the fact that the business of firefighting has hardly existed throughout history must say something.

Michael A. Clem October 7, 2010 at 11:24 am

Gil, the history of firefighting does show some evolution, even for government-provided services. With newer technology and developments, combined with free-market entreprenurialism, fire-fighting could be cheaper, safer, and more effective than ever before in the history of mankind. Could be, that is, if we let that market develop.

Greg October 7, 2010 at 10:14 am

Empathy and ignorance are a dangerous combination. You will often do more harm to people in an attempt to help them. The road to hell is paved with good intentions. Only through a free market, where prices give us information about what products and services are required, can we shed the ignorance and have any hope of actually doing good for ourselves and others.

Brian Bowman October 7, 2010 at 10:37 am

Agreed.

Contemplationist October 7, 2010 at 10:17 am

At this point in my intellectual development I no longer believe that these people are naive or ignorant. They know exactly what they want and play dirty politics to get it. This is why I advocate two wings of the libertarian movement. So far, we’ve mostly tried to engage the statists’ arguments and done comprehensive work to show from theory, historical happenstance, and intellectual tradition how they are wrong. But this MUST be supplanted with a political-activist wing which plays fast and loose and HARD. The statists’ have many, many pressure points and wedge issues. Ever wonder why Rand Paul was attacked so viciously for making a sincere argument for freedom of association? These people recognize the danger of political ACCEPTABILITY of memes and are out to destroy them before they plant themselves as alternative thoughts in the minds of everyday people.
We need to start hammering on the statist’s weak points, and driving trucks through them with force. Its time for Offense. Thats it.

Gil October 7, 2010 at 11:05 am

Actually he making the argument for freedom of disassocation.

Brian Bowman October 7, 2010 at 3:44 pm

Gil, clarify who. And what, while you’re at it. Is that like “we discordians must stick apart? ” ;)

Michael A. Clem October 7, 2010 at 10:58 am

Brian Bowman raises good questions, even if he’s not really asking questions. Brian thinks this county fire department moved in the direction of liberty by offering voluntary fire insurance protection to people outside the county (note that it is still not voluntary within the county). The problem, however, is that the existence of the county fire department still creates issues and modifies the market place from what a real free market would be. First of all, they charge an arbitrary price that has no real, economic meaning. They could well be charging too much or too little. Second, since they ARE a government agency, and not a private organization, people have an expectation that they would still save the man’s home and would bill him for it. The fact that they didn’t isn’t a ‘free market’ action, but a random, arbitrary action. The expectation was a moral hazard and an economic risk for anybody who might otherwise have thought of offering private fire protection for the same area. Without the uncertainty and moral hazard created by the county fire department, private organizations, both for-profit and voluntary, might indeed have existed to handle the situation. Furthermore, without that expectation, broader, more holistic solutions may have evolved, such as fire-treating the house before any fire broke out (and in the longer term, building more fire-resistant houses). Insurance companies, if not constrained by government regulations, would have an incentive to make sure fire treatment or protection was available, and could offer lower rates in such cases, or alternately, higher rates where such treatment or protection was not available. In an emergency, perhaps the insurance company might find it cheaper to pay a for-fee fire service if the owner couldn’t (although in this case, the owner *could and did* offer to pay expenses–the county fire department simply refused to accept his offer). In short, this is a poor example of libertarian services, and shows us once again the danger of equating “voluntary” and “privatization” with government-provided services. I also think it shows that any incremental movement away from government services to privatized services must be thought out carefully–some will be better than others.

Gil October 7, 2010 at 11:15 am

Building fire resistant houses? Nah, you can’t use asbestos.

The point is that this bloke wanted to be more-or-less a free rider. Chances are if a private business had a one-off fee it would be really expensive as firefighting once a house was up in flames would be deemed too risky to be anywhere near $75. The fact that firefighting has never been much of a formal business entity and is ususally a volunteer thing where it has been private means this guy would have been equally screwed anyway. I’ve think we seen TV shows and movie where a barn has caught and not much can be done except to try to stop the fire spreading outside the barn. If you live out in the sticks then chances are you’ll have to fight the fire yourself.

Michael A. Clem October 7, 2010 at 11:44 am

Gee, asbestos is the only fire-resistant material that could POSSIBLY be used in house-building? I don’t think so. Also, there are other fire prevention techniques that could be incorporated, such as sprinkler systems, good electrical wiring design, careful landscaping, etc. Just because you can’t think of a solution doesn’t mean that a solution doesn’t exist. And if I read a related article correctly, the owner offered to pay the full expenses of the firefight, not just the $75. And of course, movies and TV shows always provide accurate information and knowledge about how the real world works. NOT!

Phinn October 7, 2010 at 11:15 am

I’m reminded of the California electricity crisis …. you know, back in 2000 when one of those “libertarian” industries produced an economic disaster resulting in millions of blackouts.

Among other things, the government fixed retail prices but not wholesale prices. (Actually, it fixed both, but then temporarily loosened the price-fixing rules on the wholesale end, but not on retail, because more voters pay the retail prices, and politicians need to buy those votes!).

This socialistic system (with a few fascistic/corporatist profit-oriented features around the periphery) led to a total meltdown and billions spent in cleaning up the mess.

People seemed to ignore the fact that electricity is one of the most highly socialistic industries in America. But the “free market” was to blame. Typical.

Brian Bowman October 7, 2010 at 2:33 pm

Mr. Clem, thanks for recognizing an ol’ farmer has a few good questions. Since this is the intertubes, I gonna just light into you like a TV lawyer. Come on over and hop in the hot tub and watch cattle later, no hurt feelings here.

1. What price isn’t arbitrary? A Mises-perfection store doubles the price on striped green dresses, and they finally sell.

$75 is pretty close to what it costs in taxes for fire protection around these parts. So no, it isn’t really capricious and random. Any totally free business would probably operate close to their model.

2. This fetish of “total freedom or I’m throwing a panty wad tantrum” has to end. Mises recognized a continuum of freedom. He didn’t think the US was totally free. Yet he recognized the difference between the USSR and the US.

Well, so do I. I recognize the Libertarianism-ness in the Tennessee set-up. I’m no academic; I milked a cow, I did some welding today, sold some good from my farm, and got an open heifer bred again. But I ain’t no dummy.

3. Business goes for all it can get. No business is going to run on a loss. And putting out fires of non-subscribers is a money loosing proposition. They loose good subscribers who figure: Why pay today when they’ll spray anyway?

Ok, now I’ll be friendly non-lawyer. You mentioned “holistic.” I’m into that.

I’m miles away from a hydrant. So I spray lime on any bare wood. (It’s called whitewashing. Literally. Plus it looks pretty. But I don’t whitewash figuratively.) Lime and water is cheap, and while no guarantee, pretty effective 50% of the time, especially in an observed fire, like burning trash on a dry day. I’ve done put one out before by my lonesome and a shovel. Didn’t want to loose my precious hay pile and everything else. http://www.youtube.com/user/BowmanFarm#p/u/9/tCrFrzE8qDU

Like I said, I’m Libertarian. I’m just not into a bunch of academic hogwash, which I see a bunch of here.

One of the worst examples is thinking Libertarian solutions are always appropriate for city folk. They don’t want it. City folks aren’t always into freedom. It doesn’t work. Cities are hierarchical to their core. They’re more into trinkets. You know what Jefferson said?

“When we get piled upon one another in large cities, as in Europe, we shall become as corrupt as Europe.” ~Thomas Jefferson

Is the “Voluntary City” an oxymoron? My estimation is the average libertarian is trying to have his cake — liberty — and eat it too — live it up on the baubles of a hyper-complex hierarchical society.

Hyper-complex hierarchical societies and liberty just don’t mix. At least in mine and Jefferson’s humble opinion.

Michael A. Clem October 7, 2010 at 5:00 pm

I’ve responded to most of these – do I need to repeat my answers, or can you look through the thread and find them?

Phinn October 7, 2010 at 7:22 pm

>>1. What price isn’t arbitrary?

A free-market one.

>>I recognize the Libertarianism-ness in the Tennessee set-up.

And yet you refuse to recognize the far more significant non-Libertarianism-ness in it.

Merely exchanging money for goods and services does not make a transaction an example of a free market.

In the Soviet Union, for example, people would use their rubles to buy goods and services from State-owned companies. If you did not pay at a grocery, bakery, or electronics store, then you did not get the good.

Did these Soviet stores for consumer goods have some Libertarianism-ness in them? Well, sure, I guess. But overall, is it an intelligent and sensible thing to say that the Soviet consumer economy was an example of a free market?

No, it is not.

Brian Bowman October 7, 2010 at 8:59 pm

Going from a socialized, forced, tax-paid system to a voluntary, non-tax, subscription based system is a significant move toward the Libertarian side of the continuum. Just admit it. The truth doesn’t hurt that bad.

Matthew Swaringen October 7, 2010 at 9:46 pm

A “de-facto” monopoly is still not a monopoly. Again, people are generally not denying that the outcome is possible, just that it is necessary. There is definitely more than one way to run a business effectively, and just because you think every fire entrepreneur is going to be most efficient by maximizing subscriptions by allowing fires to proceed doesn’t mean that’s the only way to work.

I’d like you declare for me how the next 200 years of technological progress will occur since you seem to assign yourself quite a bit of credibility on the matter of fire fighting.

Phinn October 7, 2010 at 10:52 pm

The town’s policies didn’t “go” from socialized to Libertarian.

The city has a socialist fire department, based on taxes. But the city does not have the power to tax people living outside the city, obviously. Likewise, the city is under no legal obligation to service anyone outside the city limits, since that would mean that the people living in the city, who are forced to pay for fire service, would be compelled to subsidize people who do not pay to support the fire department. But its trucks could physically reach people living outside the city, so it offered to provide protection to anyone who paid voluntarily, which is the ONLY way the city CAN POSSIBLY get non-city people to pay.

The city converted precisely ZERO people living inside its taxation zone into voluntary payers.

Got it?

When the Soviet Union sold state-manufactured electronics through state-owned stores in exchange for money, which was paid at the discretion of the customer, and the goods were withheld from those who did not pay, was that “a significant move toward the Libertarian side of the continuum”?

When a public, state-sponsored monopoly or state-owned utility company sells its product for money, which is paid at the discretion of the customer, and the goods are withheld from those who do not pay, is that “a significant move toward the Libertarian side of the continuum”?

Because if you think these statist enterprises are examples of a “libertarian” economy, you’re plain nuts.

Brian Bowman October 8, 2010 at 7:12 am

Is Mises nuts? He thought the US was a more free place, a more libertarian economy, and the reason for American economic success over the USSR.

The fact you are ignoring is there is no “public untility” monopoly in Obion County, for 37,000 county residents outside of the small village of 2,500 population.

Today, you could go there, buy land, get trucks, hire some hats, and start your own fire brigade.

Just like private insurance companies are forming private fire departments in California to protect clients’ homes from wildfires.

Quit your belly aching! Get that entrepreneurial spirit and some investors! Nobody is stopping anybody from doing it.

Brian Bowman October 8, 2010 at 7:07 am

Keep banging away on your monopoly drum all day if you like the sound. However…

There is no forcibly maintained monopoly in Obion county for the vast majority of residents.

County residents, outside of the small town, in Tennessee have no fire service monopoly over them. Nobody is making them pay taxes. Nobody is forcing them to spend any money on fire services.

Buy the trucks and start taking subscribers or contracting with insurance companies. It should profitable if what you say is true.

Nobody is stopping anybody from setting up their own private fire brigade and taking on subscribers or contracting with insurance companies. Private insurance fire brigades are already forming in California and protecting their clients houses from wildfires.

Chuck October 7, 2010 at 12:14 pm

Have you forgotten that a tax paying citizen of America was denied services from a tax funded agency? The mayor cannot allocate funding for a government service through paid taxes an then charge an additional fee for services rendered to rural areas of the city.

This Fire Department in question is controlled by government in which taxes are paid. This would translate to a service provided for the people from the people. This man should not have been denied services. If the mayor of any city wants a fee to provide conditional fire services, he should establish a market for non-tax funded private agency.

With any government service, the funding which is collected from the U.S. citizen as TAX, is for the people.

(Not sure if this is a good comparison, but it speaks in the same context.)

The public school system (paid for by the Peoples TAXES) cannot deny services. But the private school sector (paid for by PRIVATE EXPENSES) with out a doubt will deny you services that are not paid.

Michael A. Clem October 7, 2010 at 12:25 pm

Chuck, check the story a little more carefully. This was a county fire department, and the house that burned down was *outside* of that county. The department offered services to people outside the county for a fee–the owner was never taxed for the service.

Chuck October 7, 2010 at 1:30 pm

According to the news feed, I understand that this was an Obion county resident who pays county taxes only, requesting services from an Obion county Fire Department belonging to city of South Fulton.

Who gives the right to that mayor to use a government agency as a part-time private service by charging additional fees for services to any tax paying citizen of that county. This should remain a funding issue between the state of Tennessee and Fulton City not the tax payer.

Would you question a mayor of a city who required a fee from residents of the same county outside the city limits to receive protection from his National Guardsmen in the event of tyranny created by local militia using terrorist tactics.

Its Fire services funded through taxes making is just as free as Police services, HR or Military services that does not require additional fees.

Thank god this was not an issue for the fire departments outside of New York City! (9/11)

Harry Nutz October 7, 2010 at 4:39 pm

It was not an issue after 9/11 because no fire department was restricted from providing help to the NYFD. If a fire dept. from New Jersey was called to help during 9/11 but was prevented from doing so by the municipal gov’t that controls it–then you would have a similar scenario.

Local government failure.

Frank G October 7, 2010 at 2:54 pm

If this is what the tea party wants, I am beginning to really like these guys, even if they have some conflicted views on other subjects. Its amazing to me how progressives seem to beleive that anything government attempts to do can be done with no limit. Its as if thy beleive that governments are capable somehow of escaping the laws of scarcity. Not paying a $75 fee to receive fire protection services (that btw is a great deal, I pay $4k/yr for that privilege) was this gentleman’s choice. He obviously didn’t see any value in it or thought that he had better uses for the $75. In my case, I personally don’t have Hurricane insurance becuase I consider it a too expensive for the risk. If my property gets destroyed in a ‘cane its my loss and my problem only. I took the risk thinking the reward was worth it. On the other hand, if I don’t get hit by a hurricane from now until the time I sell my property, I’ve saved a bundle of cash. Its my free choice to be smart or stupid. I keep the reward if I win or pay the price if I lose.

Personally if it were me, I would have paid the $75. This guy should have investigated the fire departments policy on fires before making his choice. Maybe that information would have encouraged him to pay the fee. He and his neighbors should be grateful to not have a fire dept that they are committed to paying for since it will assuredly cost more then $75/yr. Fire dept’s are usually boondoggles for huge waste in most large cities. Ours is staffed my over 2500 of which about 1/2 are government made multi- millionaires. I would gladly welcome having the choice to pay or not pay for them. I would also love to have the choice to contract with private companies for the same service.

The funny thing about most progressives is that they are just like the Tea Partiers when it comes to paying more for government–they want no part of it themselves. That should tell you how much they value government themselves.

Harry Nutz October 7, 2010 at 4:32 pm

Why is everyone talking about the “county fire department?” Every story I’ve seen reports that it was the city of Fulton’s fire department and their $75 fee applied to people who lived in unincorporated areas of the county. This is a big omission, IMO.

The residents of the city paid taxes and received protection of the fire dept. Those who lived outside of city limits had the option to pay a nominal fee to get the same coverage. They were offering this because there was no fire department for the county residents.

Michael A. Clem October 7, 2010 at 5:02 pm

I stand corrected, then. Thanks!

Alex Courtney October 8, 2010 at 1:45 am

Great discussion.

I think Mr. Brian Bowman brings up an interesting point, that it would be difficult to go directly to pure free markets from our current starting point of quasi-socialism.

The intellectual heavy lifting showing that liberty is a more ethical and cost effective means to organize society has been done. However, how do you get to more liberty and less government from this point. If one were to attempt to unwind government market intrusions, what would be a good way of going about it without events such as this one creating “public” outcry which would be used by those seeking power and then lead right back to government intrusions? Given the current cultural climate in the U.S., can government intervention be rolled back to say its levels in the early 1800s? How about 1900? How about 1980?

Freer markets would emerge as government interventions are removed, events such as this would occur. Would the public continue to march toward freer markets or return to the mistakenly perceived safety of government? Unfortunately, the more government gets involved, much greater costs are incurred. But to many people these costs are unseen and therefore not considered.

We must entertain the possibility that a free market would not provide “general” fire brigade service because home owners would be willing to take the risks. However, at some point in the future, a market may develop because an entreprenuer builds a more cost effective fire brigade system for which customers are willing to pay. Or are we going the other direction, toward making fire brigade services unneeded, because we are building better homes and buildings, to a point where it is more cost effective to insure the building for fire and let it burn and rebuild? I don’t know the answers to any of those questions, but I do know that currently a great majority of the populace would rather have tax paid/subsidized fire brigade service than none at all. Even if it is at greater cost.

Perhaps this man whose house burned didn’t know that he would get no fire brigade service if he didn’t pay his $75 fee. Maybe he thought he would be able to purchase on the spot. Or maybe he knew the risks of not paying the $75 fee and made a conscious decision to accept them. I don’t know how he made his decision.

My conclusion in this is that: yes it was unfortunate that this man’s house burned down whether or not he paid his $75 fee. I am grateful no one was seriously hurt. And that’s enough rambling by me.

Brian Bowman October 8, 2010 at 7:38 am

The latest Libertarian smoke-blowing denial game is Obion county has a “monopoly” preventing competition, kind of like the monopoly “public utilities” have.

Fact: There is no forcibly maintained monopoly in Obion county for the vast majority of 37,000 county residents outside of the small village of 2,500 population.Nobody is making them pay taxes. Nobody is forcing them to spend any money on fire services. And nobody is stopping anybody from setting up their own private fire brigade and taking on subscribers or contracting with insurance companies.

Obion County, TN, is open for business. Much of the US is open for business. Even California is open for business. Yes, even in California, private insurance fire brigades are already protecting their clients houses from wildfires.

So fellas, quit yer belly-achin’, and buy some land, throw up a pole barn, find some trucks, hire a few hats, and start taking subscribers or contracting with insurance companies in Obion County.

Whoever can git’er’dunn in Obion county, I’ll buy ‘em a cigarette holder. That way the entrepreneurial hero can celebrate man’s victory over fire! And after dousing the first flames on your first call, you can trace a dollar sign in the sky!

You might even drive the mayor’s fire brigade out of business in the small village. That would be a PR victory for libertarianism like none other.

P.S. Don’t let non-subscribers houses burn, or Mr. Tucker will deny you as fast as Peter did Jesus. There’s got to be a way to convince subscribers to pay fees even though you’ll spray if they don’t pay, right?

Phinn October 8, 2010 at 9:25 am

>>You might even drive the mayor’s fire brigade out of business

You really don’t get it.

The governmental fire department is not “in business.”.

It has the power to tax. It has the power to seize your property if you do not pay what it unilaterally decides you are going to pay.

No private company is going to enter a market where the existing service is being provided by an organization that can snap its fingers to get any money it wants, and can change the rules any time it wants. It can also, at any time, unilaterally declare that your private business is closed.

The only time this can happen is where the local statist, Soviet fire department has degenerated so thoroughly that it would be a political liability to squelch the only vendors who are rescuing people on a regular basis. Until the Soviet model of fire service has almost fully collapsed, as in California, it displaces private entrepreneurial initiative.

Brian Bowman October 8, 2010 at 10:19 am

You don’t get it. The county residents don’t get taxed for fire service. The county does not have the power to tax for fire service because the voters took that power away from them.

Richie October 8, 2010 at 11:49 am
Phinn October 8, 2010 at 12:49 pm

>>You don’t get it. The county residents don’t get taxed for fire service. The county does not have the power to tax for fire service because the voters took that power away from them.

This is my last shot. If you don’t grasp what I’m about to say, then you never will.

With regard to the in-town residents, they pay taxes to the socialist fire department. Outside the limits, the town does not tax, because it can’t. I’m pretty sure you follow me so far.

Here’s the Big Idea — The in-town socialiist fire department, by its very existence, displaces and inhibits any viable private fire company from forming anywhere within the socialist fire department’s service area.

Not only is it virtually impossible to compete against a statist rival that has no concerns over pricing and customer service, but the city can annex the private company’s service area at any time and shut it down overnight.

This displacement effect is an example of what is commonly called “economics.” The presence of the statist, socialist fire department has far-reaching secondary and tertiary economic effects beyond the limited number of people who are taxed to pay for it.

So, your suggestion that someone start a private rival company fails to account for the fact that there’s a reason this is not happening. Understanding economics requires that one consider not only what is actually happening, but also what is not happening.

Around here, that’s called understanding both the “Seen and the Unseen.”

Any fool can account for what is Seen, given sufficient time and patience. It takes a little more effort to account for the Unseen effects of something — which are the things that do not occur that otherwise would have occurred.

Comments on this entry are closed.

Previous post:

Next post: