2019-01-19T09:05:04.000Z Honest Cash
Response to "I identify myself as a libertarian" by somospolvo

What do you think of Murray Rothbard?  At first I didn't think very highly of him, but that changed when I read "Toward a Reconstruction of Utility and Welfare Economics" (1956) and "The Myth of Neutral Taxation" (1981).  Basically, the only problem with government is that it doesn't know our valuations of public goods.  

Rothbard said that, if there was a button that would abolish the government, he would press it until his thumb blistered.  He really hated the government.  

Would you push the button?  I wouldn't.  I don't hate the government.  It would be easy to fix it simply by giving taxpayers the freedom to choose where their taxes go.  

For many years I have advocated for "pragmatarianism".  People have two main objections…

1. taxpayers are uninformed
2. wealthy taxpayers would have too much influence

At some point I realized that taxpayers are basically subscribers, so I started arguing that Netflix subscribers should be free to divide their subscription dollars between nature shows and horror movies.  

Did anybody object that Netflix subscribers are uninformed?  Nope.  Did anybody object that some subscribers would have too much influence?  Nope.  Instead, people objected that Netflix already knows its subscribers' preferences because… view/votes.  

So the real problem is the widespread perception that markets aren't needed to reveal our valuations.  The solution?  Honest Cash!

HC is a market… how we divide our dollars between #econ posts and #art posts reveals how we want society's resources to be divided between them.  In theory this will help everybody understand just how useful markets truly are, and then taxpayers will be free to divide their tax dollars between defense and education.  

We will have a market in the public sector and we will also have a market in the private sector.  These two markets will be very different though.  The market in the public sector won't have any prices.  You could spend any amount of your tax dollars on defense.  Since everybody is different, people would spend different amounts of money on defense.  It wouldn't be one-price-fits-all.  

Essentially, consumers are going to be more honest with producers of public goods than with producers of private goods.  Public producers are going to make more accurately informed decisions than private producers, so taxpayers are going to want to spend more and more money in the public sector.  The private sector would shrink and shrink until it was completely gone.  

The tax rate would be 100%, but we would be able to choose where our taxes go.

Do you think this outcome is realistic?  

Consider this thought experiment.  Here on HC I can't spend my money on my own posts.  The same is true over at Cent.  In neither market do I have the opportunity to divide my money among my posts.  I have no choice but to hide my valuations of my posts.  In this regard I'm essentially being forced to lie to other consumers and producers.  

All else being equal, what would happen if HC gives us the opportunity to spend our money on our own posts?  We would be more honest with each other, so HC producers would make better informed decisions, and the result would be a more valuable supply of posts.  Naturally we would want to spend more money here than at Cent. 

In this post I said that it would be very beneficial to be able to easily find someone's most valuable post.  I posted the story on Twitter and Craig Talbert replied

“Is it beneficial to be able to find and see a creator’s most valuable creation?” I think yes, but just one yes. Not the When Harry Met Sally “Yes! Very yes! So so so so so yes!!!!”

Hahahaha… *awkward*.  Not sure if you saw the movie, but Sally pretends to have a very loud orgasm in a restaurant.  After she is finished a lady sitting at another table tells the waitress… "I'll have what she's having."  This lady would of course be very disappointed with the dish.  It really wouldn't be orgasmic.  

When consumers pretend that something is better or worse than it truly is, then this misleads other consumers and producers.  No society truly benefits when its members bark up the wrong trees and go on wild goose chases.  

The goodness of a market depends on its honesty.  The more honest a market is, the more valuable its supply will be.  

Right now Honest Cash is far more honest than Reddit.  But this really doesn't say much, because everybody on Reddit is super dishonest.  They don't have the opportunity to reveal their valuations.  Here on HC we do have the opportunity to reveal our valuations, except when it comes to our own content.  

Rothbard was super right about the importance of our valuations, but he was super wrong about the solution.


The private sector is private property

by @somospolvo

I would press the button if there was one. It would eliminate the State. But there is no button that I can press. What exists is the dynamic and evolutionary process of society. Hopefully, that's the button.

On the other hand, I think the term "market in the public sector" is a contradiction. The public sector is itself a monopoly. I do not want the State to take 100% (or 50%) of my money on the condition that it lets me choose what is spent. I can choose where to spend my money according to my own criteria.

Nor do I want the state to grow with the hope that magically it becomes something good. That is utopian and is not consistent with the reality of the nature of the State.

Much less do I want the private sector to disappear. The private sector is the independent citizens with our rights. The State is what we still have because at the moment we have no option.

The disappearance of the private sector would be the disappearance of the market. And the growth of the State would be another failed socialist experiment.

I have not read Rothbard directly (not at least one of his complete books), but I invite you to read something that I have read: "Socialism, economic calculation and entrepreneurship", Jesús Huerta de Soto.

The private sector is private property, and private property is the basis of human survival.

Honest Cash Is A Market... So What?

by @Xerographica

If each and every taxpayer could choose where their taxes go, then the public sector would be transformed into a market.  For some reason this idea does not excite you.  Guess what?  You're not alone!  Less than 100 people like the tax choice Facebook page.  

It's also the case though that most people aren't super excited about the fact that Honest Cash (HC) is a market.  

HC is a market… so what?  What difference will it make that we can spend our money on the content that we value?  This substantial and specific feedback, from my perspective, will help producers supply content that is more and more valuable.   

Let's say that my theory is wrong.  Maybe the supply of content here on HC will be pretty much the same as the supply of content on the democratic websites such as Medium, Facebook, Reddit and Twitter.  

But if markets really aren't so awesome and amazing… then greatly reducing or eliminating taxes wouldn't make much difference.  There wouldn't be much benefit to people being able to spend more of their money in the private sector market, given that markets aren't so awesome and amazing.  

Thanks for telling me about Jesús Huerta de Soto.  Are you going to tell him about HC?  If not, then why not?  If so, then do you think he will be very excited about the fact that HC is a market?  

I found his articles at Mises Institute.  There are lots of them!  I'd like to read the most valuable one, but I can't, because is not a market.  Readers don't have the opportunity to spend their money on the content that they value.  

Since is not a market, then maybe markets aren't so awesome and amazing.  If this is the case then it wouldn't be very beneficial for the public sector to become a market.  Then again, neither would it be very beneficial for taxes to be reduced.