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by nitrogen 4125 days ago
if problem 1 really matters, market forces will handle it.

Market forces didn't handle seat belts, air bags, fuel efficiency, racial discrimination, taxation without representation, etc. We cannot rely on the market to solve all problems.

5 comments

Market forces didn't handle those problems because either 1) there was no established market or 2) the problem was institutionalized by government (last 2).

Cars and highways were novel. People wanted them more than they wanted to be sufficiently safe, or fuel-efficient. Volvo is not touting their ultra safe cars because of regulation. The market wants it now. There is a market for that now. It's impossible to prove there would be no market if not for the government regulation. Just look at what we elect to spend on health care. Just look at Tesla and the success of the Prius.

With enough information, people will pay for well-being regardless of government mandates.

True - but in defence of OP's point, the UK has a competitive market for broadband service providers and there (for the most part) net neutrality is not an issue. So, anecdotally, solving problem 2 could minimize the effect of problem 1.

On the other hand I think this is a great win on its own :)

In particular it's worth noting that some providers wanted to make net neutrality an issue in the UK: In particularly once iPlayer launched, they were wildly unhappy with the traffic the BBC "caused".

But they were in the unhappy position (for the ISPs, not users) that if they started negatively affecting iPlayer, their customers would have plenty of choice.

The comical part of that whole affair was that they should have cheered the BBC on:

Bandwidth used for iPlayer was bandwidth they could get incredibly cheaply simply by peering with the BBC [1] at a range of public peering points or even directly, and bandwidth end-users used to get at iPlayer content would be bandwidth they wouldn't use to stream over far more expensive routes.

Of course, the reason they were whining was that many of them had severely underdimensioned their backhaul networks to their core networks compared to the speeds they were actually selling to their customers, so in the short run it drove up costs, but in the long run the larger market share the BBC and other domestic streaming providers have, the better, for the above reason.

[1] https://support.bbc.co.uk/support/peering/

Huh - I was vaguely aware of the uproar about iPlayer in the early days, but I had no idea the BBC did peering agreements. This was fascinating, thank you :)
From the original comment: > Problem 1: ISPs trying to charge to (de)prioritize packets. > Problem 2: The two biggest ISPs suck, and should be broken up, and/or it should be mandated that competition is much easier.

My point is that problem 1 is only a "problem" because of problem 2. If it's easy for new competitors to enter the market (which I think addresses the main complaint about charging for traffic), then "problem 1" is not a problem. It may well be the case that you can't solve the competition problem without solving the pay-for-traffic "problem", but the competition problem is the only one that matters on its own.

If Comcast wants to charge Netflix for their traffic, let them go ahead. This country used to have antitrust laws that should be perfectly sufficient to take Comcast to court and break them up if the case can be made that they're doing it to punish competition and promote their own services.

I can see the case that sometimes it makes sense and is fair to charge big users, and that sometimes this behavior can be abused to harm competition. My worry is that Net Neutrality is a sledgehammer we don't really need.

Problem 2 will go away fairly quickly if the two biggest ISP's do not invest in their infrastructure as they will create a situation where it is easy to get leapfrogged by other players. Net neutrality curbs an aspect of piss taking and bad behaviour that is both current and proven and is merely a law to abide by for all players, whereas breaking up independent companies is surely far more of a sledgehammer, and one that should only be used as a last resort if legislation fails.
Market forces would have handled racial discrimination if the government had done the one job it had to do of equally protecting businesses that were owned by or catered to racial minorities.
As always, these items are only presented as "problems" because of the presence of government. So when government steps in and solves them, all pro-state individuals shout a glorious "Hurray, take that free-market!!'.

>Seat Belts: If individuals wanted them, the car companies would have followed suit. You forget that not only were seat belts mandated to be installed, but people were FINED if they didn't put them on.

>Air Bags: If there wasn't a state, I'm sure you'd have safety organizations putting out reports/studies about effectiveness of air bags. Rich people would buy them in their cars, poor people wouldn't, and they don't do that now anyways. Not sure how you see this is as something "government" fixed as it's different to seat belts, which are mandated?

>Fuel efficiency: Ah yes, another environmental tax meant to incentivize good behavior. Let me know how that's working out. All this does is drive up the cost of cars unnecessarily under the pretense of environmental benefits. Again, if people wanted it, you wouldn't have to force them to do it. This is the basic basic difference that most pro-market, and anti-market sentiments boil down to.

>Racial discrimination: This was enforced and perpetuated by state laws. Some would argue it still happens today with certain mandatory sentencing laws, minimum wage, etc.

>Taxation without representation. What? You want the market to solve a problem that solely exists because of the state, revolves around the state, and is absolutely not subject to any market forces at all? Perhaps if I could "choose" where my tax money was spent, then there would be some sort of market force driven by individuals. But that's nowhere near the case.

Now, a little more on-topic. You are absolutely right that we can't rely on the market to solve all problems, but in the presence of a state. The temptation is always there to "correct" or "slightly nudge" the market in directions we want it to go, rather than what the collective unconscious has decided. The free-market is more democracy than democracy is right now, and people fundamentally can not accept that.

I'll let that great promoter of free trade and market forces Adam Smith weigh in here:

“People of the same trade seldom meet together... but the conversation ends in a conspiracy against the public,...”

Corporations have vast resources and capabilities far beyond those of the individual and frequently use them against us for their own benefit. Tobacco companies faked and suppressed research and knowingly lied in their advertising. Car companies fought seat belts and air bags tooth and nail. Few companies campaign for minimum quality standards in their categories of products, yet information about quality are essential to informed participation by purchasers in any market.

Ideally each of us indivudualy should be fully informed about every decision we make, but the fact is it's simply not possible. So instead we delegate responsibility for many of these decisions to our leaders. They regulate markets on our behalf and increase the efficiency of markets by performing necessary research, standardisation and negotiations on quality once so we can all benefit from it every time we make a purchase.

Appropriate regulation of markets is essential to their function, and delegation of responsibility based on democratic choice is itself a market mechanism. Of course there are arguments to be made about the appropriate level and type of regulation.

"They regulate markets on our behalf..."

That would be awesome if it were true, but it's not. It's very naive to believe politicians and bureaucrats work for anything other than their own self-interest.

Now that the FCC runs the Internet who do you think is going to influence them more- Comcast's lobbyists or you?

Some cynicism can be healthy, but just because there are issues, some of them serious, with American democratic processes doesn't mean the whole system is corrupt and run purely for the benefit of the ruling elite. I know what that looks like. My wife is Chinese.
As with a pure democracy, in order for market forces to work, you have to assume that the individuals really want what is best for them or best for society at large. Pure capitalism isn't going to solve many serious problems that can be attributed to tragedy of the commons -- pollution, fuel efficiency, etc. -- because not everyone is an expert in those areas, and I don't fault them for that. Likewise with issues like racial and gender discrimination, if those decisions were left up to individuals to decide whether they "want" to promote fairness to marginalized people, then I can assure you that the status quo would not change. Market forces can fix many things, but they won't fix societal issues way larger than the individual -- or at least not in a timely manner.
>Seat Belts: If individuals wanted them, the car companies would have followed suit. You forget that not only were seat belts mandated to be installed, but people were FINED if they didn't put them on.

Not sure i see an issue here, we know that individuals did not particularly want them, just as i would prefer not to wear a seatbelt on an airplane because i'm not capable of understanding at any given time what the likelihood of danger is on a plane. Do you get mad at the government went the fasten seatbelt sign goes on during turbulence?

> If there wasn't a state, I'm sure you'd have safety organizations putting out reports/studies about effectiveness of air bags

You are "sure" are you? congratulations, no one else is. You can't use hand waving to dismiss this problem.

>Rich people would buy them in their cars, poor people wouldn't

In a country that absolutely necessitates the use of a car, do you think its morally acceptable to keep airbags out of reach of the poor?

>and they don't do that now anyways

Are you under the impression that poor people in the US drive around in cars without airbags and seat belts?

>Fuel efficiency: ... Let me know how that's working out.

Its working quite well, I lease cars and each of my last three cars (3 years each, current car is due next month) were cheaper than the previous and more fuel efficient. For the record i was not switching types of cars - previous cars where pontiac G6, Chevy Malibu, Mazda 3, all similarly sized/priced cars.

>Again, if people wanted it, you wouldn't have to force them to do it.

OK so i want a 99 MPG car. If i dont have to force an automaker to produce one, why arent they? Youre looking at the market as a abstraction of reality. In reality an automakers motivation is profit, not sales. There are other ways of increasing profit than determining and matching consumer demand. To ignore this is far from trivial.

>Racial discrimination: This was enforced and perpetuated by state laws. Some would argue it still happens today with certain mandatory sentencing laws, minimum wage, etc.

Whats your argument here? That we would be better off with no state laws at all? That we would be better off with no regulation on discrimination in any direction?

>The free-market is more democracy than democracy is right now, and people fundamentally can not accept that.

Its not that people can't accept it, it is that a direct democracy is universally accepted as a terrible organizational structure. Theres a reason the US is NOT a democracy. There is no disagreement, the free market would be a direct democracy, and that is not a positive thing to say.