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Source link: http://archive.mises.org/15494/buy-local-save-your-government/

Buy Local, Save Your Government!

January 31, 2011 by

From the “Ignorance Dies Hard” Department comes this report from one of my local newspapers, The Hook:

In tough economic times, it might be hard to come up with anything more visceral than this appeal from a Central Virginia businesswoman: “Buy local. Save your job.”

It’s a slogan so powerful that it’s been attracting attention since its last-year unveiling, and it’s the brainchild of a local business owner.

“I want tax dollars staying in Albemarle [County],” says Nancy Vetter, vice president of PrintSource, a printing and marketing company located on Berkmar Drive.

Vetter says she was inspired to put her message into the iconic European automobile oval sticker format when she saw yet another customer go online to order out-of-state printing services.

“Spending money in California doesn’t help here,” says Vetter.

Well…it helps California, right? And don’t they deserve economic prosperity as much as Virginia?

In response to Ms. Vetter’s false bumper-sticker economics, I’d cite this counterargument from Russ Roberts, who actually knows something about economics:

When I talk about the idea of “buying local” I often say that we’ve tried the “buy local” experiment, it’s called the Middle Ages. In the Middle Ages, we mainly bought local and pretty much everyone was poor. This isn’t a proof that buying local is impoverishing. A lot of things have changed since the Middle Ages so it could be that we’re richer now than we once were because of those things, not because we trade with a wider slice of humanity than we did then. But I’m trying to get people to think about the logic of buying local. Even if we had the technology we have now and traded with only a few thousand people who lived near us (as was the case in the Middle Ages for the most part), we’d be desperately poor. We couldn’t sustain the division of labor that creates our current level of prosperity.

In fairness, Ms. Vetter seems less concerned about prosperity then she does maintaining the status quo — particularly when it comes to preserving the local monopoly government:

She surmises that many people just don’t realize how online ordering can yank money from the local economy. And for many younger people, online is the first place they go when making a purchase.

“My daughter says toner is $3 cheaper in New Jersey,” says Vetter, who notes that when one adds in shipping costs, online isn’t always cheaper.
It’s not just private businesses that lose out when dollars leave Central Virginia. So do cash-strapped local governments.

“Someday, you’re going to need a cop, you’re going to need a library, and your kid is going to need a teacher, ” says Vetter, who is so impassioned about keeping money in the local economy, she has also printed a flier that urges: “Buy local. It benefits us all.”

Sure, if you believe police, libraries, and schools can only be provided through violent extraction from the local populace, then Ms. Vetter’s “buy local” argument makes a good deal of sense. Governments are parasitic organisms by design. A dollar spent outside its jurisdiction is a “loss” to the parasite.

It would also never occur to Ms. Vetter and that services like police and libraries would could be provided more efficiently — better service, lower costs — if they were open to the same type of competition as other businesses. Of course, Ms. Vetter doesn’t like competition to begin with. Her entire “buy local” campaign is nothing more than an attempt to smear her more efficient competitors as somehow less righteous and altruistic as her. Instead of actually trying to provide a superior service, she insists that she’s entitled to customer support merely because they happen to live in the same geographical area.

I also suspect that Ms. Vetter is no stranger to the benefits of non-local exchange. Don’t tell me her printing business is composed entirely of goods acquired within the boundaries of Albemarle County. Nor, I’m willing to wager, does she reject customers who come from outside the county.

And going back to the negative impact on her beloved local government: Is it possible, just possible, that the ever-rising cost of monopoly government might be a factor driving the growth of non-local competitors, in particular Internet-based retailers? Physical businesses accept a host of local mandates and controls that divert capital away from actually serving customers. It’s understandable that a physical retailer like Ms. Vetter is frustrated that she’s paying for an overpriced, over-burdensome county government while her online competitors do not. But then she should take her frustrations out on the people who are actually hurting her business — the county officials — instead of offering a Stockholm Syndrome-induced plea to save her attackers from the prospect of declining ransoms.

As Professor Roberts noted, “buy local” is a strategy for stagnation and poverty. It is not a valid method of “saving jobs” or creating prosperity. And it’s foolish to indulge such ignorance as anything other than the economic equivalent of witchcraft.

{ 37 comments }

Robert January 31, 2011 at 3:36 pm

” violent extraction”

Taxation is not violence.

Michael A. Clem January 31, 2011 at 3:38 pm

What happens when you don’t pay your taxes??

Edward King January 31, 2011 at 3:48 pm

Nothing. Don’t you know taxes are completely voluntary like all state interactions?

nate-m January 31, 2011 at 3:49 pm

They threaten you with fines.

If you don’t pay they begin to take your belongings. They will try to take your house, take your car, take you kid’s college fun, etc. They will try to force your employer to pay them instead of paying you.

If you fight them and resist their attempts to seize your property they will send a gang of armed mean to forcibly remove you.

At that point you end up in a concrete cage, a ruined carrier, no loved ones, destroyed marriage, lost access to your pets, your belongings. Remove access to everything you spent your life on acquiring and everyone you love.

If you try to fight THAT fate they will simply shoot you dead _then_ take everything.

Yep. There is no violence inherent in the system.

El Tonno January 31, 2011 at 4:01 pm

Member of an anarcho-syndicalist commune, I see? Bloody peasant!

Stephen Adkins January 31, 2011 at 4:45 pm

Well you can’t expect to wield supreme executive power just because some watery tart threw a sword at you!

Capt Mike January 31, 2011 at 7:06 pm

Thank You Michael Palin! (The GOOD Palin!)

Michael A. Clem February 1, 2011 at 3:35 pm

thanks, guys, but I was kind of hoping that Robert might try to answer the question. Technically speaking, involuntary taxation is not necessarily violent, but it is still an initiation or threat of force against citizens.

Peter Surda February 2, 2011 at 10:24 am

but I was kind of hoping that Robert might try to answer the question

Based on his posts so far, he does not seem to be interested in answering questions. He rather seems to be interested in complaining and an undisturbed life in his la-la-land.

Brian January 31, 2011 at 4:19 pm

I agree with your overall critique of Vetter’s hypocritical and naive claim, but I take issue with the closing statement: “‘buy local’ is a strategy for stagnation and poverty.”

The recent movement advocating the purchase of locally-grown food probably comes to mind first for many folks when discussing the topic, yet this particular component of “buying local” is reasonable and does not lead to stagnation and poverty.

I purchase my produce locally (from a family farm 2 miles down the road) because I prefer high-quality, fresh produce. The kohlrabi that I saute for dinner have often been harvested that morning. Beyond the quality, the best supporting claim for buying local produce is that you preserve the aesthetically pleasing farmland of your surrounding region. If I wasn’t greeted with pastures and cropland every morning on my way to work, I’d have gone mad years ago.

But most importantly, I can be assured that the gentleman I purchase my food from has succeeded in gaining my loyalty by means of hard work and satisfactory performance. Unlike the majority of farms that supply the local supermarket who have secured their success with the help of massive government subsidies and competition-stifling regulation.

danny January 31, 2011 at 4:34 pm

An individual should only follow the buy local dictum after ensuring they are supporting the business which can provide the best service/product most efficiently.

One other scenario which I would ‘buy local’ is if I by buying local I could use a hard currency and not a fiat currency I may be persuaded to sacrifice (some) quality/efficiency. Though if as a society we demanded quality and efficiency in all aspects – government spending and the marketplace – it would be easier to get away with a fiat currency (though I don’t recommend it because the temptation for greed is too great).

Eric B January 31, 2011 at 4:42 pm

If you could purchase at lower prices and more convenience the same delicious high quality fresh produce, would you?

Brian January 31, 2011 at 5:23 pm

Same quality of product and service at a lower price? Yes I would, but only if it was still a local farm that allowed to me to, as Europeans say, “eat my view”, i.e. protect the picturesque rows of crops & pastures that I see on my daily drive from turning into another desert of cookie-cutter houses.

RG January 31, 2011 at 5:25 pm

In other words, do your best to encourage malinvestment.

Stephen Adkins January 31, 2011 at 5:34 pm

It’s not a malinvestment if it aligns with his preferences and he’s willing to pay for it. People can prefer a particular good or service for all kinds of weird reasons, and ‘eating one’s view’ is as good a reason as any other. If a person chooses to spend more money on a certain good because he believes it makes the world a better place, that’s his choice as well.

The problem comes in when governments step in and make that choice for everybody, or allow certain people to indulge in their idiosyncrasies without having to pay for them. That’s when malinvestments and unintended consequences occur.

Matthew Swaringen January 31, 2011 at 5:59 pm

Good point.

Brian January 31, 2011 at 5:57 pm

No, in other words to greedily protect the view from my abode by financially supporting landowners who specifically use their land in a manner that I prefer & benefit from.

I suppose purchasing membership from a country club is encouraging malinvestment by preventing the land from being used in more productive manners such as serving as the foundation of an electrical plant? And purchasing the stocks of a company that manufactures steel kitchen utensils is supporting malinvestment because that steel would yield more wealth as a component of a factory machine? And Rothbard created malinvestment by purchasing jazz concert tickets for his personal enjoyment instead of spending that money to harvest natural resources?

Gil January 31, 2011 at 7:49 pm

Everthing should be grown and made in China then?

babybell February 4, 2011 at 11:48 am

“buy remote” is just as insane as “buy local”

Stephen Adkins January 31, 2011 at 4:57 pm

“but I take issue with the closing statement: “‘buy local’ is a strategy for stagnation and poverty.”

If I live in Washington State, it makes sense for me to buy locally grown apples. If I live in the Sahara, it doesn’t make quite as much sense. The author isn’t saying local is always worse (sometimes it’s much better); just that the strategy of always assuming that local is better is wrong, and it leads to absurdities as well as stagnation and poverty.

Sometimes I go to a certain coffee shop to study. Plastered all over the walls and on employee tshirts is this slogan: “Break the Chain – Eat Local!” I keep meaning to ask where that apparel is made…

augusto January 31, 2011 at 6:08 pm

Or where the coffee beans come from…

RG January 31, 2011 at 5:24 pm

Discrimination within the market is perfectly acceptable. But, it will be driven out over time because of the premium paid to restrict choices, thus resulting in relative stagnation and poverty wherever it is practiced.

Anthony January 31, 2011 at 9:15 pm

RG,

Customer discrimination will not be driven out over time because there is no such thing as an inefficient consumer. Consumers buy according to their preferences, and thus by definition take whatever course of action is most closely aligned with their interests as they see them at the time of the purchase.

An inefficient producer will go out of business as you indicated above, but if it is my preference to pay more for local apples then that will certainly not put me “out of business” as a consumer.

mr taco January 31, 2011 at 4:46 pm

“Someday, you’re going to need a cop, you’re going to need a library, and your kid is going to need a teacher, ”

as if the market cannot provide these things : p

Eric January 31, 2011 at 4:48 pm

“I’m not payin’ no other people outside of my household. We keep our dollars in-house! We accept arbitrary and artificial boundaries because somehow it supersedes economic prosperity and exchange of goods and services in the most efficient manner possible.” = The logical conclusion of that sentiment.

Bruce Koerber January 31, 2011 at 5:48 pm

A variation on this ‘buy local’ theme is a free banking system where individuals build a network for financing productive activities in a contractual, trustworthy manner.

Capt Mike January 31, 2011 at 7:09 pm

I buy local when it suits me i.e. yummy ripe tomatoes in July.

Otherwise, eh, maybe. If the deal is better (or at least not worse).

RTB January 31, 2011 at 9:11 pm

Funny.

How do you define local? Depending on how one defines it, at best I might be able to live on corn, beans and duck. Probably live in a wooden house with an outhouse and a fireplace for heat. No electricity. Bye bye all modern conveniences including things as simple as toothbrushes and silverware.

Don’t people who aren’t “local” matter?

Where does she buy all her supplies from? Refer to “I, Pencil”. Does she have all the necessary components situated right next door?

It’s really too ignorant to really delve into on this site. It’s a common misconception, but probably more something to expound upon in more uninformed circles.

Anthony January 31, 2011 at 9:18 pm

I don’t know… this is exactly the kind of thing that can start people thinking. The more obvious the better.

Ohhh Henry January 31, 2011 at 10:58 pm

Whenever my local radio stations start running ads featuring a local media personality who urges the public to “shop locally” (presumably instead of buying from online retailers who have prices between 10 and 70 percent cheaper) it tells me just one thing – they couldn’t sell enough actual advertising so they’re filling the dead air with public service spots aimed at brown-nosing local stores so they will buy more ads. Ultimately I suppose that it’s a sign that they are too stubborn to lower advertising prices, lay off staff or cut salaries – another example of so-called sticky wages. It is a government town after all and they are utterly dependent on government hacks to get their broadcasting license renewed. Acting like sensible entrepreneurs and cutting prices and costs will not usually be their first response to financial distress.

But aside from the economic fallacy at work these little “shop local” ads are harmless fun … and it’s a lot better than what some radio stations do, which is endlessly play government-sponsored public service messages which are nothing but propaganda for the fascist police state. The “click it or ticket” ads are the most obnoxious of these but very typical. Another inadvertently humorous ad is read by a union organizer who sounds like Al Capone, urging local tradesmen to “organize their contractor”.

Stephen Adkins February 1, 2011 at 12:05 am

organize, huh? sounds ominous…

Anony-mouse February 1, 2011 at 12:31 am

“Buy Local, Save Your Government!”

Save the government?

Why the hell would anyone want to do that?

babybell February 4, 2011 at 11:55 am

It’s funny that my largest expense is to “buy” government “services” that I do not want. And a major portion of that is for non-local government!! If only there was a way to “buy” just the local stuff, I’d be so much happier…

jon February 1, 2011 at 7:32 am

note that the “buy local” movement still thinks your money belongs in FDIC-insured savings accounts, earning less than 1%. “banking” should be “free.” of course.

and i imagine you’re supposed to “swipe your charge card locally but then pay it off upwards of 12% nationally,” too. gosh, how do those rich just keep getting richer? they must be screwing us somehow!

noah February 1, 2011 at 8:26 am

“Sure, if you believe police, libraries, and schools can only be provided through violent extraction from the local populace, then Ms. Vetter’s ‘buy local’ argument makes a good deal of sense. Governments are parasitic organisms by design. A dollar spent outside its jurisdiction is a ‘loss’ to the parasite.”

The fact remains that those services ARE provided through violent extraction from the local populace. How those services COULD be provided is not so relevant when you are dialing 911.

Wherever you spend your dollar, some parasite is going to get its cut. The point is, you want to feed your own friendly neighborhood parasite before you feed some far away parasite. Your own friendly neighborhood parasite just might offer a small return on its violent extraction.

Dale P February 1, 2011 at 4:17 pm

notice there is the class of goods and services that are NIMBY (not in my back yard) or locally.
Like a petrol refinery and other such things.
some folks in oregon are fighting a LPG terminal cause the locals cannot consume it all and some might go to Califormia. oh dear

RTB February 1, 2011 at 10:31 pm

Just illustrates on sooooo many levels how utterly ignorant the “buy local” argument is.

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