Whenever a promoter of the notion starts talking about “social justice”, the subject eventually comes around to markets, and the social-justice promoter always considers them evil, cruel, and generally unsatisfactory. They should be replaced, according to that ethic, with a system that allocates things according to need.
It’s helpful, in such situations, to define what is being discussed. In this case, it’s pretty simple: A has something (at this point in the analysis it doesn’t matter who “A” is, or what the “something” actually is) and B wants it. B then needs to find something A wants badly enough to induce A to swap. That’s all there is to a market.
As with anything, there’s a pathological version. Perhaps B has a gun, and asks A if he wants to keep his kneecaps (or his life) in return for handing the thing over. We define that as robbery, but it’s really just a special case of a market — B gets what he wants in return for something A wants.
Now consider the case where distribution is made on the basis of need. Somebody has to determine that the need exists — in the example, that B needs whatever it is. From B’s point of view, there isn’t much difference. The allocator has the something, B wants it, and must do what the allocator wants in order to get it. But that’s a new market!
Now, it may be (and often is, for the promoters of “social justice”) that what the allocator wants isn’t anything material. The warm feeling of having done good for B may be sufficient. In ‘way too many cases, though, what the allocator wants is one or another form of truckling — B must beg prettily and tug his forelock in order to get what he wants. That doesn’t change the fact that it’s a market, though.
What it does do is render the market illiquid, because there’s no currency involved. What the allocator wants is non-material and poorly defined, and it isn’t available for trading with the next participant. That makes the market hard to manage — impossible, in fact — and the dream of fair allocation goes out the window. There’s no way of making the market “fair” if all the participants have to come up with something different.
And what about A? From A’s point of view, he started with something and ended with nothing — the allocator got it, and gave nothing (that A wanted) back. If A agreed with that at all, it has to be something similar to the perverse version. The allocator had to threaten A with loss of something else in order to achieve A’s disgorgement of what B wants, and what the allocator thinks B should have. In the worst and most perverse case, that’s part of what the allocator wanted in order to do the deal in the first place.
So in their zeal to eliminate the market, the “social justice” promoters have done no such thing. What they have done is create two markets, one illiquid and impossible to manage under any terms, the other perverse and damaging to at least one of the participants’ interests. It’s hard to see how that’s an increase in “social justice”.
What if B doesn’t want to do what the Bureau of Socially Just Distribution wants? Well, he can always go back to A, who has what he wants, and offer something in trade; or A can seek out B, and specify something A wants that B might have. That’s the original market, isn’t it? The BSJD will call it a “black market”, but really it’s just the haves and have-nots trying to get together without interference from the bureaucrats — which is what “black market” means.
So now, instead of a market, we have three of them. From A’s point of view, the BSJD is just another B, although one that wants to engage in perversity; that’s one. From B’s point of view, the Bureau is just another A, wanting something in exchange. And the two can always get together, which is the third market. Dayum, Joe Bob! Them markets is multiplyin’ like cockroaches!
Real markets in the real world are more complex than that, of course: Rule #1 is It ain’t that simple! But the fundamentals continue to apply, they just get more subtle and obfuscated. When you try to stamp them out, Markets Happen Anyway.
Ric's Rulez 
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8 September 2009 at 6:12 pm
The Monster
I’m going to disagree with you a bit here on terminology. I find the transaction where Rocco and his Louisville Slugger are used to persuade me to part with the hard-earned contents of my wallet such a different thing from, say when I willingly trade some of it for dead beast smoked low and slow at one of the many fine KC purveyors of BBQ heaven on earth.
The element of force is present in the first case, but not in the second. The difference between coerced and uncoerced transactions is so great that they warrant different words. The Left seems unwilling to recognize this distinction, and I prefer not to aid and abet them in it.
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That having been said, one of the aspects of Rule 2 that is consistently ignored is the notion that government can make Someone Else pay. Consider the “employer’s matching contributions” to SS and Medicare. If Congress were to pass a law requiring the entire amount be nominally paid by employees, just as it is now by the self-employed, nominal wages would rise by 7.5% and the employee would be back with pretty much the same take-home pay as he has now, and the employer still paying the same amount for his labor.
When government requires employers guarantee they’ll hold your job for you and hire a temp while you take Family Leave, that costs them something. If you think it’s not coming out of your paycheck, you may be an idiot.
When governemt requires employers to pay time and a half for overtime, that means your employer can’t afford to pay you as much per hour. If you think you’re getting that money for free, you might be an idiot.
When government requires employers to pay 7.5% surtax if they don’t provide employees a health insurance policy that meets HR-3200 requirements (or Kathleen Sebelius waves her magic wand and grants a waiver), that is added to the 2.5% the employee is nominally paying to make a total of 10% coming from the employee. If you don’t think that’s coming out of your paycheck, you are an idiot.
The laws of supply and demand are not repealed, even though they may be distorted by all the noise. Markets happen anyway.
9 September 2009 at 8:50 am
warlocketx
And that’s a good bit of the reason you find it so difficult to get the Left to make the distinction. You have allowed your emotions to lead you into a domain error, like “How heavy is blue?” Since domain errors are common in Leftist philosophy, and they have become adept at working around them in their thinking, they have no problem dismissing yours.
One of the things I always try to do is to delve down to first principles, from which the rest of the structure is built. If A has X and B wants it, the process by which that tension is resolved is a market. The market may be perverse, as it is in the case of B’s use of violence, and the prime characteristic of a perverse market is that it does not relieve the tension, merely transfers it somewhere else.
If you recognize that, the Principle of Unconstrained Exchange (which I hope to address in the near future) and its consequences are relatively easy to absorb; if you do not, the Principle is so much gas.
Regards,
Ric
9 September 2009 at 5:02 pm
The Monster
How so? What two concepts am I attempting to relate to one another in illogical fashion?
You have nicely asserted this, but it is not the definition I see in dictionaries. They define a “market” as a place where people trade, or an abstraction of the trade itself.
So now we’ve moved to defining “trade”. You think Rocco is asking me to trade my money for the continued possession of intact kneecaps; I think that “transaction” is undeserving of the same word as the uncoerced variety. first of all, I already have a perfectly good pair of intact kneecaps. Rocco isn’t offering me anything.
To me, equating an exchange of value for value (what I mean when I say “trade”) with an exchange of value for a promise not to destroy something of value is the category error here.
I’m not as good at this as Goldstein is, but I do know this: If we allow “market” to include armed robbery, “rationing” to include individual budgetary decisions, as well as the more blatantly Orwellian “property is theft” “all sex is rape” we lose the ideological war without firing a shot. and that’s why, even though I think we agree far more than we disagree, I can’t just sit here and let you redefine words to mean something they’ve never meant before without calling you on it. No matter what you hope to accomplish by changing the language, it rarely ends well.
12 September 2009 at 9:20 am
Ric's Rulez
[…] September 2009 in Da Rulez In the comments to Rule #2, Monster upbraids me for ethical deficiency and my own domain error: …equating an exchange of […]