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March 26, 2010

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Libertarians aren't against governments per se, but they believe governments should be as minimal as possible and provide very basic services (they often argue about the level of services the gov't should provide) and regulate against fraud and coercion (depends on the libertarian). But their flawed belief is that everything everyone does is directly proportional to the level of work they put in. Implementing libertarian political ideals against poor and less powerful people is a lot easier to do compared with rich and powerful people. Take health care as an example. As long as mega insurance companies are allowed to buy and control politicians via unlimited contributions, legislation will always benefit the insurance companies at the expense of the people. But libertarians have no problem with unlimited contributions, and they do not have any problems with corporation personhood. So what we end up with is corporate fascism.

Libertarians may scoff at "corporate welfare", but how likely is it that politicians would truly stop "corporate welfare" as opposed to cutting general welfare for the people? There will always be an inherent imbalance of power and influence between government/corporations and the masses.

"Nike sneakers have a “swoosh” on them which advertises your prole tastes to the world."

?! So what do you recommend I work out in, a pair of Oxfords? Do you even own a pair of athletic shoes?

"In other words, the online role playing economy is fair in a manner that the vast majority of people would define fair, but the real world is not."
Hence, why it's so popular.
I think the same thing goes with playing poker: everybody starts out with two random cards (or five, or seven).

"?! So what do you recommend I work out in, a pair of Oxfords? Do you even own a pair of athletic shoes?"

If you're a SWPL, you wear Vibram Five Fingers shoes. Actually, a few weight lifters wore Oxofrd shoes in the past.

http://www.rei.com/product/754675?preferredSku=7546750196&cm_mmc=cse_froogle-_-datafeed-_-product-_-7546750196&mr:trackingCode=3F844FFE-FB85-DE11-B7F3-0019B9C043EB&mr:referralID=NA

Sheila,

If you want to be more SWPL get a pair of ASICS. Though I have never heard anyone consider Nike a "prole" brand. I suppose wearing Nikes to work could be "prole" depending on your job.

"If you want to be more SWPL get a pair of ASICS"

Has New Balance fallen out of favor?
http://stuffwhitepeoplelike.com/2008/04/20/96-new-balance-shoes/

What's worse? Being an "SWPL" or a "Prole"? Is there a list somewhere of all the downsides and upsides to being a prole, middle-class, a yuppie, an SWPL etc? Is it possible to not be considered a prole if a you act nothing like your typical prole (think Roseanne Barr) but work in a typical prole profession?

What's worse? Being an "SWPL" or a "Prole"? Is there a list somewhere of all the downsides and upsides to being a prole, middle-class, a yuppie, an SWPL etc? Is it possible to not be considered a prole if a you act nothing like your typical prole (think Roseanne Barr) but work in a typical prole profession?

Bulls eye sigma

"The economy in online role playing games is much closer to the model of perfect competition, which is the standard method of analysis that libertarians like to use to evaluate the real world economy even though there is very little perfect competition in the real world. "

Actually, what I find interesting about the WoW auction house economy is that it is very far from perfect competition. It gives me an opportunity to be a participant observer in a market thin enough to let me observe cartel formation and a variety of related tactics, such as buying out gems someone else has put up at a low price in order to resell them at a high price, that don't exist in a perfectly competitive market.

Heh, hits the criticism sweet spot perfectly. Here's him talking about how one could teach economics using WoW http://daviddfriedman.blogspot.com/2009/01/world-of-warcraft-course-proposal.html

Academic economists are so deep in the forests they only see the foliage and not the google-earth view. All the imperfections of the real world are abstracted out with apriori assumptions and all-else-being-equal. Someone should take a WoW clone, take out the perfect government that you mention, and invest avatars with some functional AI (not rule-based, some probabilistic learner) to make them autonomous, transacting agents -- A more complex life simulation. Now that'd be an approximation the right direction

Most games also have anti-twinking rules that restrict item transfers to and between characters. This enhances the relationship between work and reward by preventing low-level characters from carrying items that they could not have obtained through their own in-game work. Obviously, the real world has much more limited anti-twinking rules. We quite expect that many people with lots of money were gifted it.

It is not that free-market economies depend on government regulations. It is simply the case that there exist regulations that increase trade along with regulations that decrease trade. Minimal government tends to focus itself on those regs that increase trade

You're thinking too hard, sigma. Nerds like videogames. Nerds like libertarianism.

I don't play this but I know that even in WoW there are cheats. Did you read that NYT Mag article a while back about "gold farmers"? You can hire gamers in China to rack up points or whatever it's called for your avatars.

Also, re Wal-Mart, there are regular folks that get products on the shelves there. Not sneakers -- you need an established brand or new angle for that, since Wal-Mart can make its own generics -- but new sorts of gadgets. If you build a prototype of some new thingy, there are companies that specialize in getting new products on retail shelves, on QVC, etc., and consider submissions from regular folks all the time. It's a long shot, but it is doable.

Great article.

But like some other commenters, the Nike/prole comment stuck out to me even though it was an aside.

I basically only wear Nike shoes. I'd say Nike isn't prole at all; it's about as mainstream as you can get.

The WoW economy model also assumes constantly replenishing resources.

Star Wars Galaxies, which peaked 5 years ago, had a much deeper crafting game. Resources with varying qualities appeared and suddenly disappeared - leading to high barriers of entry, trusted brands, and eventually...duping.

"It is not that free-market economies depend on government regulations."

Actually you're wrong, World of warcraft has a huge amount of control and what is allowed, they are the governing authority. Rules can't exist if there is no one to enforce them.

Take for instance the banning of World of warcraft players, no "abstraction" can enforce the bans since rules by themselves have no power.

Lets not also forget about trying to hack the games code (another form of subversion of the government laws).

The code of WoW was coded by an authority (the owners of WoW) therefore if people try to hack the code (hackers) and try to break the worlds rules (governing laws put down by the government - wow's owners) then there will be penalties.

WoW is a classic case of the worlds need for an authority to deal with those who would try to subvert rules of the game to the detriment of the public good (WoW's customers).

So there is truly equal opportunity in WOW? Why don't black people love it, if that's what they desire?

WOW is really boring. I always wonder how people can spend so much time playing it. It's like an Asian education system, but with fantasy characters. Repetition! No wonder Asians like it so much.

As to why Libertarians love it, I think you are right. It's like their own Randland. Too bad status in WOW doesn't translate into status in real life, so libertarianism is laughed at by most respectable people.

I work part-time at an athletic shoe store.

Nike is Asian. Asians love buying expensive Nikes.

http://www.asian-central.com/stuffasianpeoplelike/2009/03/28/113-nike-shoes/

Low proles buy their athletic shoes from WalMart. High proles prefer UnderArmour or cheap Nike shoes.

The popular SWPL athletic shoes these days are Vibram 5 Fingers, Newton, Brooks, and Mizuno. A "real running shoe" is what all SWPLs want.

Brown NAMs flock to the soccer section, while black NAMs ogle at the Jordans. I can usually tell what people are looking for them by their race and the way they are dressed.


"Star Wars Galaxies, which peaked 5 years ago, had a much deeper crafting game. Resources with varying qualities appeared and suddenly disappeared - leading to high barriers of entry, trusted brands, and eventually...duping."

Yes. Before I left SWG after its New Game Enhancements were put in place, I made quite a bit of in-game currency selling resources to crafters. I would find rich lodes of ultra-high quality ores and other resources and drop as many harvesters as I could. Crafters would pay top dollar for high quality resources because an item made with high quality resources would have better stats than one made with average quality resources. On my server, the now-defunct Corbantis, there was an armorsmith/weaponsmith named Armani who was recognized as *the* crafter on the server.

Also, while there was a sort of public auctionhouse-type function in SWG, it was generally for very common items of low cost and most merchants maintained their own shops in their houses or in collaborative malls in guild houses. It was common to see items for sale out on display as well, such as weapons hanging on walls or armor set out as if on a mannequin.

I also recall that there was pretty much no such thing as bind-on-equip or bind-on-pickup, either.

WOW & Libertarianism are both popular with socially mal-adroit misfits who don't want to live in the real world.

"Libertarians like to believe that the real world operates this way; that the only thing that prevents you from being as rich as Bill Gates is that Bill Gates put in the effort to raise his character to level 99, while you were too lazy to do the same thing. In the ideal libertarian world, there is no HBD, no luck, no credentialism, no irrational behavior, no Black Swan events (to use the term coined by Nassim Nicholas Taleb), no winner-take-all effects, no insurmountable barriers to entry, no value transference."

I have to admit that I have a strong libertarian streak in my political thinking, but the above paragraph states clearly why I can't really be 100% libertarian. The libertarian ideology sounds so clear cut, and it (in theory) justifies not wading into the confusing troublesome marsh of government regulation. But the real world is a much more cruel, unfair, and darwinian place.

If one listens to libertarian commentator Neal Boortz on the radio, one often hears him comment about how those foolish liberals keep foolishly thinking that each person's position in life is the result of "one big game of roullette," as he puts it, rather than of merit and hard work. It is true that hard work and effort can sometimes bring success. But there is so much that is just pure random chance, or the cold darwinian logic of different human abilities.

Sometimes, I'd like to see some of these pure libertarians actually get a taste of this cold reality. It seems Boortz, for example, has quite a protected environment in his radio studio, from which to lecture the world about effort and "hard work."

"Libertarians like to believe that the real world operates this way; that the only thing that prevents you from being as rich as Bill Gates is that Bill Gates put in the effort to raise his character to level 99, while you were too lazy to do the same thing."

Randians would agree with this statement.

"The popular SWPL athletic shoes these days are Vibram 5 Fingers, Newton, Brooks, and Mizuno. A "real running shoe" is what all SWPLs want."
_______________________
Brooks and Mizuno are touted as being "eco-friendly". They carry lines of shoes that are pvc-free -- pvc is highly toxic and carcinogenic. One thing that strikes me as odd about athletic shoes is how they all look from ugly to hideous. No matter what class one belongs to, they will look like freaks while exercising with their mesh covered uber-tech feet protectors. How would libertarianism cure the world of ugly athletic shoes? Are the people 100% at fault for the ugliness of the shoes because they demand it?

I think TV talk shows fit the model of perfect competition. There are no barriers to entry. People from all educational and professional backgrounds can jump in at any time and compete on a level playing field. You have standup comics (Rosie O'Donnel), high school dropouts (Roseanne Bar, Howie Mandell), PhDs (Dr. Phil), MDs (Dr. Oz), people with backgrounds in BIGLAW & politics (Jerry Springer), former journalists (Barbara Walters), actors (Ricki Lake) & even models (Tyra Banks). Of course the high school dropouts (Roseanne & Howie Mandel) were cancelled, but this may because dropouts average less g & thus struggle to survive in such a competitive, improvisational & verbal field.

There is very little value transference. The primary value creator is the host of the show who must be spontaneous and entertaining enough to keep the show fresh & interesting on a daily basis & if the host can perform that job, he/she has enough leverage to gain ownership of the show (where the real money lies) which is how Oprah became a billionaire despite no business training.

It may seem like sitting around talking does not create billions of dollars of value, however over the past quarter century Oprah has created thousands and thousands and thousands of hours of uplifting inspirational entertainment for tens of millions of people around the world which has even been empirically proven to increase the level of altruism in society ( http://timesofindia.indiatimes.com/life/spirituality/self-help/A-positive-elevating-emotion/articleshow/5535211.cms ).

Oprah's spin-off Dr. Oz works part time as one of the world's top heart surgeons where he creates priceless life saving value for a few people, but as a talk show host teaching MILLIONS of people how to avoid cancer and diabetes, he creates far more value for society and will ultimately save the tax payer trillions in health care costs.

"The irony is that the key to perfect competition, based on the online gaming model, is government regulation."

It is no irony at all. Perfect competition is a type of game. Games need rules. Some rules make the economic system more efficient, others make it less efficient.

Generally speaking the type of rules libertarians support are those that are clear principles rather than arbitrary favors for one group or another.

It isn't about free market vs. regulation. It is about finding rules that will lead to growth, and avoiding rules that will inhibit growth. Very simple really.

Online games are near perfect free markets because the transaction costs are zero. Shipping, storage, etc are all free. Wal-Mart would be happy to sell your homemade items if shelf space was free for them. The market in digital goods is like this. Anyone can make an Iphone app and sell it on iTunes, no government involvement at all.

Don't confuse libertarianism with anarchism. Libertarians are not radicals, they are just classical liberals and people who believe in economics.

I also don't know why you guys seem to think that libertarians view the modern U.S. economy as some kind of free market utopia. They don't. The U.s. is more libertarian than most other countries, but that doesn't mean it is super libertarian on an absolute scale. Libertarians are people who WANT the world to be libertarian.

From reading these comments, it seems like a lot of you are in the same boat. You WISH the world was a libertarian paradise, but you have a cynical view of how the world really works, so you laugh at libertarians. This doesn't really make sense. Listen to some Cato podcasts. They are a cynical as any of you.

I'd say almost everyone here is a Libertarian except with regard to immigration. But for some reason you still enjoy laughing at straw man libertarians who are more naive than you.

"The irony is that the key to perfect competition, based on the online gaming model, is government regulation."

It is no irony at all. Perfect competition is a type of game. Games need rules. Some rules make the economic system more efficient, others make it less efficient.

Generally speaking the type of rules libertarians support are those that are clear principles rather than arbitrary favors for one group or another.

It isn't about free market vs. regulation. It is about finding rules that will lead to growth, and avoiding rules that will inhibit growth. Very simple really.

Online games are near perfect free markets because the transaction costs are zero. Shipping, storage, etc are all free. Wal-Mart would be happy to sell your homemade items if shelf space was free for them. The market in digital goods is like this. Anyone can make an Iphone app and sell it on iTunes, no government involvement at all.

Don't confuse libertarianism with anarchism. Libertarians are not radicals, they are just classical liberals and people who believe in economics.

I also don't know why you guys seem to think that libertarians view the modern U.S. economy as some kind of free market utopia. They don't. The U.s. is more libertarian than most other countries, but that doesn't mean it is super libertarian on an absolute scale. Libertarians are people who WANT the world to be libertarian.

From reading these comments, it seems like a lot of you are in the same boat. You WISH the world was a libertarian paradise, but you have a cynical view of how the world really works, so you laugh at libertarians. This doesn't really make sense. Listen to some Cato podcasts. They are a cynical as any of you.

I'd say almost everyone here is a Libertarian except with regard to immigration. But for some reason you still enjoy laughing at straw man libertarians who are more naive than you.

"1. The rules of the game ensure that all goods of the same name are completely fungible. All +1 mythril swords are exactly the same. You can’t “craft” a +0.95 mythril sword and call it a +1 mythril sword, because the rules of the game don’t allow it. You can’t craft a +0.95 sword at all. The number of different items in the fantasy world is pretty finite."

Who argues against laws punishing fraud?

"2. The government ensures that everyone has fair access to the markets by operating a single store in each city known as the Auction House. Anyone is allowed to sell a certain number of fungible items at the Auction House, and whoever sets the lowest price will sell his good first. Each character has a limited number of auction house slots, so everyone has a fair chance to sell his goods without all of the auction house slots being dominated by a single brand."

In the real world you can still sell stuff out of your garage or set up your own Auction House. If people like what you're selling or find the AH better able to satisfy their needs than the Wal-mart system, they'll go there. They don't because not everybody is equally able to provide a quality product at a reasonable price. Those that can survive and find their items on the shelves of retailers.

"3. In the online role playing game, there is no assembly-line production. Every player operates as his own sole proprietorship with no employees. Thus there is no vale transference from employee to employer. You get to keep 100% of the value of your production."

In a libertarian system, every employer is trying to buy labor. This doesn't only apply to people in the same industry, but all employers. Those transferring the most value to themselves will face competition from others willing to give workers a better deal. Wages go up and any "value transference" is kept to a minimum.

Your argument also implicitly assumes that the entrepreneur who saved the capital used isn't adding value. If the laborer could create an equal amount of value on his own he would and keep all the profits. The fact that he can't is proven by the fact that he chooses to remain employed in the first place.

"4. In the online role playing game, there are no insurmountable barriers to entry. In the real world, once you’ve gone to the wrong law school, you can never get into a lucrative BIGLAW job. "

Perhaps those that hire lawyers decided that it was more efficient to recruit from schools with average IQs of 135 instead of 115. Law school admissions is based on a test that measures IQ, the LSAT, and GPA, a proxy for conscientiousness.

Some credentialism is unfair, but no field has as much government interference as education. You can't blame this on libertarianism.

"But in the online role playing game, if, per chance, you wasted time raising your leathercraft skills, and then discovered that goldsmithing is actually the more profitable trade, nothing prevents you from putting in the time to raise your goldsmithing skills."

Nothing in real life prevents you from raising your "goldsmithing skills" either, except the fact that time our time on this planet is finite.

"Libertarians like to believe that the real world operates this way; that the only thing that prevents you from being as rich as Bill Gates is that Bill Gates put in the effort to raise his character to level 99, while you were too lazy to do the same thing. In the ideal libertarian world, there is no HBD, no luck, no credentialism, no irrational behavior, no Black Swan events (to use the term coined by Nassim Nicholas Taleb), no winner-take-all effects, no insurmountable barriers to entry, no value transference."

You have a very simple view of libertarianism. Nobody argues that there's no such thing as individual differences, luck, irrational behavior or credentialism. Only that the market will decide what kind of credentialism makes the most sense (once again, absent the government being involved in education, requiring licenses, etc.) and people can best decide what's to be done to improve their lot.

No one denies the "winner take all effects" either. If you're one of the 300 best basketball players in the world you'll be able to play in the NBA and earn millions of dollars. If you're only one of the top 1,000 players nobody is going to pay to watch you preform when they can see superior players for two hours a night. NBA players are being compensated for providing entertainment that people want and the consumers get to choose. This shouldn't bother anybody.

I think the modern running shoes look great. I own two pairs of Mizunos, a pair of New Balance, and some Asics.

I'm a SWPL at heart.

The WoW economy is further distorted by the presence of goldfarmers. Many people will openly denounce gold farming, but will quietly place orders for 5 thousand gold units (probably about 50 USD and 3 days or more of boring grinding of raw materials for sale in game) which leads to price inflation. Many people have huge amounts of buying power, this allows sellers to inflate prices, pushing non-gold buyers out of the market and destroying the market for secondary and tertiary crafted items that WoW built into the economy and crafting ladders in order to allow people to level.

I would like to see a game where all items are craftable, and where all gear can be augmented, so that newer players or returning players can be immediately competitive and where the customization of older gear would alleviate some of the hamster wheel effect.

Players (even raid addicts) finally reach the top of the mountain, acquiring all the cutting edge gear, and it is immediately obsolete because new content is patched into the game.

To the libertarians:

What would you do if a guy bought a bunch of your neighbors' houses, knocked them down and built a coal burning power plant?

Nothing as you describe it.

If the burning plant emitted smoke and pollutant (or shade the property) we would bring him to a judge to be compensated and to make him stop his trespass. The judge (accepted by both sides) decide the matter based on proof and laws (not legislation).
Usually is easier to find a compromise for the coal burning plant owner and for the home owners than going to a judge or fighting.
If the could burner plant owner is unreasonable self-defense is acceptable. And if he argued is his right to pollute the houses downwind, he can not argue it is not our right to pollute his plant.

It is the government that prevent people from retaliating against his behavior. He have privileges others have not.

The problem of creating a stable libertarian society is the problem of building a society of people that punish exploiters (and people don't punishing the exploiters) but it is unwilling to use force first.
The best solution is the seasteading way, where people would be able to go away when the governing body become too demanding.

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