Deregulation / Privatization, on one foot

[athena glaukopis]

Hi all,

I'm looking for websites / op-eds / essays (online) that explain *concisely and clearly* why deregulation / privatization improves a market (especially of things that most keynesians think should be provided by the gov't, such as unemployment).

I've run across a few dozen of these before that I can remember, but I don't usually "save" websites... I figured some of you might have some particularly good ones saved at your fingertips.

Edited: Clarity, grammar.

Edited October 22, 2008 by athena glaukopis

[athena glaukopis]

Come on! 43 lurkers and not one website? lame

[Ordr]

The entire text of George Reisman's book "Capitalism: A Treatise on Economics" is freely available his website. You will be able to find exactly what you're looking for with regards to deregulation and privatization therein. I know it's not a blog and you'll have to do some digging, but the chapters and sections are pretty clearly marked.

http://www.capitalism.net/

[Greebo]

Deregulation in US Politics is a largely meaningless term unless the deregulation is so complete that Government completely withdraws itself from the market being regulated.

The current economic crisis, for example, is being blamed on "deregulation" - yet if one looks at the actual laws governing the financial sectors, it quickly becomes clear that the regulation wasn't removed, it was just reduced somewhat. Its like switching from cigarettes to cigars and claiming to have quit smoking.

[khaight]

Deregulation in US Politics is a largely meaningless term unless the deregulation is so complete that Government completely withdraws itself from the market being regulated.

I would go a step farther and say that "deregulation" is a package deal, perhaps even an anti-concept. At the very least it bundles together non-essentials. An act of deregulation is simply the repeal of a regulation. Whether the results of this will be good or bad depend critically on what other regulations remain in place, and their nature. In California, for example, they repealed some regulations on the wholesale electrical market, but left regulations in place on the consumer side. Then, when the wholesale prices spiked, we had an electricity crisis that was blamed on "deregulation". A similar process is now taking place in the financial industry.

"Deregulation" obfuscates the underlying issue -- economic liberty and respect for property rights. That's what we need to focus on.

(It's also possible that we need to do some clarification on the concept "regulation" as well. To many people, any time the government tells a private sector entity that it can't do something, that's considered "regulation" -- including banning force and fraud. An unregulated market, to such people, means anarchy, and they correctly reject it. The problem here is the flip side of deregulation. Once again, the concept is uniting on the basis of non-essentials. Some 'regulation' -- banning force and fraud -- is required to have a market at all. But bundling together legitimate and illegitimate government action under one concept results in the concession that some 'regulation' is necessary -- at which point the principle of rights has been repudiated and the government gets to play it deuces wild.)

[athena glaukopis]

Deregulation in US Politics is a largely meaningless term unless the deregulation is so complete that Government completely withdraws itself from the market being regulated.

The current economic crisis, for example, is being blamed on "deregulation" - yet if one looks at the actual laws governing the financial sectors, it quickly becomes clear that the regulation wasn't removed, it was just reduced somewhat. Its like switching from cigarettes to cigars and claiming to have quit smoking.

I meant deregulation as the process of systematically deregulating an already-government-run industry so that private citizens can enter the market, and where the deregulation continues until complete privatization is reached. (Because I assume immediate privatization would not be the best way to do it, causing shock and vacuums in the market etc)

Not hodgey-podgey "compromising" with "quasi-free" markets.

[khaight]

I meant deregulation as the process of systematically deregulating an already-government-run industry so that private citizens can enter the market, and where the deregulation continues until complete privatization is reached. (Because I assume immediate privatization would not be the best way to do it, causing shock and vacuums in the market etc)

Deregulation and privatization are not two points on a spectrum. Privatization is the process of taking a government-owned enterprise and moving its ownership into private hands. It leaves open the question of whether those private owners are then subjected to government regulations on the use of their property. The experiences of various eastern European nations with privatization indicate that doing it immediately works much better than doing it gradually. But privatizing an enterprise without also respecting the property rights of the new owners is simply a transition from a communist model of government control to a fascist model of government control, i.e. it isn't necessarily an improvement.

This goes back to the point I was trying to make in my earlier post. The concepts of privatization and deregulation are both poorly-formed. They unite on the basis of non-essentials and thus serve to obfuscate rather than clarify the underlying issue. Rather than speaking in terms of deregulation and privatization, better to speak of respecting individual rights in production and trade.