Wednesday, November 12, 2014

Why Markets Matter More to Liberty Than Elections

Why Markets Matter More to Liberty Than Elections:

When the Berlin Wall came down 25 years ago this
week, people in the Soviet Bloc gained something even more valuable
than a right to vote: a free market.

Democracy is definitely better than taking orders from Communist
dictators. But real freedom means doing what you choose as an
individual, not waiting for the rest of society to vote on whether
you can.

In politics, winners get to tell the losers what to do. In the
marketplace, you buy what you want. I buy what I want. If some
people want to buy movie tickets while others prefer to buy clothes
for their dogs, neither side needs to worry it will lose a struggle
over which option is best.

This election, as usual, there was a big push to get people to
go out and vote. Yet most didn't (more vote in presidential
elections, but still less than half the population).

After elections, pundits say, "the people have spoken." But we
haven't. Often, we just chose politicians we hated less than

I'm glad big-spending Democrats lost Congress. But In the grand
scheme of things, was that vote such a sweeping endorsement of
anyone's political philosophy? The vote, as usual, was pretty
close. Often it feels like America flips a coin.

That sounds cynical, but it's not just cynics who have doubts
about the democratic process.

Economist and law professor Gordon Tullock passed away the day
before the election. But had he lived another day, he still
wouldn't have voted last week. He refused to vote, in part because
the branch of economics he helped create—"public choice"—helped
convince him that people behave just as selfishly and foolishly
when they vote as when they make any other kind of decisions, but
with more devastating effects on other people.

At the Cafe Hayek blog, economist Don Boudreaux writes that it's
good if people don't vote because by avoiding politics they "come
to depend more on personal initiative and less on untrustworthy,
power-craving strangers." Well said.

We don't suddenly become wiser and nobler when we step into the
voting booth. If anything, the decisions we make there are more
ignorant and reckless than the ones we make when buying a car. You
probably know more about what kind of car you want than about what
sort of laws to impose on your neighbors. It's another reason why
most of life is best left to free individuals.

The left treats markets with contempt and political processes as
if they're sacred. Then, to explain why politics disappoints, they
pretend that money sullies politics.

They're upset because the Supreme Court said money can be spent
on ads that inform voters of different factions' views. It turned
out that Democrats were the biggest spenders, but that doesn't stop
them from complaining that evil Republican tycoons used money to
manipulate voters who would otherwise have chosen the candidates
decent Democrats want them to.

Republicans, meanwhile, get upset if money is used to bet on
things. There once was a wonderful online predictions-market called
Intrade. It allowed people to bet on future events, including
elections. Intrade's odds were much more accurate predictions than
those made by pundits and pollsters. That's because there is wisdom
in large numbers, and because Intrade bettors put real money at
risk (unlike pundits and water-cooler prognosticators).

But American regulators threatened Intrade with litigation, and
the site closed. There's still another prediction market, based in
England, called Betfair, but it's confusing and not as useful to
Americans. Shutting down Intrade leaves us all less informed and
more dependent on the political elite.

I get the creepy feeling that's the way the elite likes it. They
want us to think of our grubby little individual lives—full of
buying and selling, of self-expression and risk-taking—as something
inferior to the exalted political process. I think our individual
lives matter, not just those few moments we spend in the voting
booth picking the lesser of two evils to run other people's