Sienna

I agree, the most fundamental point the article misses is that competition and collaboration are not mutually exclusive. Every business is a voluntary association of individuals co-operating to mutual benefit. Every business relies on other businesses to operate. The moral basis of capitalism is not atomistic self-interest, but that it provides a framework for mutually beneficial interactions. Capitalism’s moral objection to communism is not co-operation, but coercion.

Communism does not presuppose free co-operation, it presupposes coercive central planning, a model that benefits from neither “invisible hand”.

mikk
"Without government(and their monopoly of force) laws could not exist."

Why not? Aren't you assuming that the production of law could not be anything other than a monopoly and a government monopoly at that?

http://mises.org/store/Enterprise-of-Law-The-Justice-without-the-State-P297.aspx

http://blog.mises.org/9178/does-law-require-legislation/

If property is theft, who is the owner thieving the property from? How could that person be in any better position?

I hope, for your sake and that of your about-to-expand family, Mr Holmes, that you never have to run a business more complex than a lemonade stand.

The impact of the intrusion of reality into your - let's be honest - fantasy world, would be too horrible to contemplate.

First of all, it has to be said that your summary of Adam Smith's contribution to economic theory is both intellectually barren, and plain wrong.

"Smith's invisible hand... is the single most important concept that has driven the laissez-faire agenda over the last few centuries, and which continues to drive laissez-faire economic's most recent manifestation, neo-liberalism."

Glib. Do you perhaps have some evidence of this? Or do you expect everyone to just nod, and say "ah yes, of course".

Have you actually read "The Theory of Moral Sentiment", which first referred to the invisible hand?

Do you happen to recall the first sentence of that book? It goes like this:

"How selfish soever a man be supposed, there are evidently some principles in his nature, that interest him in the fortune of others, and render their happiness necessary to him, though he derives nothing from it except the pleasure of seeing it."

I'd be interested to hear how you manage to synthesize this clear, unequivocal opening salvo, with your assessment of his work as a primer for neo-liberalism.

I do suggest you read it, by the way. It does help to occasionally know a little of what you write about.

People - businesses, services - will cooperate when, and only when, it creates some form of mutual benefit.

As per your example of the wheelbarrow.

"...two backyard gardeners, instead of each owning a wheelbarrow independently, decide to share the use of a single wheelbarrow"

Ah yes, that wheelbarrow. Their decision to share the cost was made on the basis of... what, I wonder...

Golly-gosh - isn't that like, you know, that thing he was talking about, errr, what was it - oh yes, self-interest?

Self-interest=cooperation. QED.

[Burst of ballooon. Collapse of stout party.]

It might make a nice colouring-in book, though.

Jefferson
Thanks for the links.
I cannot for the life of me understand "private law". Who decides if you can be a judge or can anyone have a go? I presume in a market system good judges could command a higher price and so leave law and "good" judges only available to the wealthy. How does that serve the cause of justice? Do only the wealthy deserve the best judges and justice? That would just lead to the rich being able to commit crimes with impunity against poor people with the knowledge their victims cant afford to buy prosecution.
Private police forces fill me with dread as they would quickly begin to fight amongst themselves and the rest of us would be caught in the crossfire. They would condemn each other as gangsters and organised crime and they wouldnt be far off. It would be up to their own paid judges to adjudicate and we all know how that would work. It would be endless privitised war with nothing to stop them slaughtering us all and pleading(if anyone bothered to question it)that we were just sadly, collateral damage.

The example in your second link of privitised lighthouses leaves out one very important fact. The owners of the now privitised ocean where their lighthouse shines would also be able to exclude those they didnt like/want to compete/want to improve the navigation.
The essence of private property is exclusion and to say that building a lighthouse gives you the right to exclude any and all for any or no reason strikes me as the antithesis of freedom, efficiency, and benefit to as many as possible. The same goes for private roads, rivers, airwaves etc etc.

Without the coercive force of the state backing up the private theft of common resources no one would abide by arbitrary and unwanted intrusions on their freedom by those that "own" property. People would take and use what they need and would not be able to monopolise and exclude people to unfairly benefit themselves.

What I find amusing is the cheerful way that GH with an anecdote of farmers co operating with a wheel barrow equates the economics of competition with that of co operation.

A basic course on public economics will enlighten you on where the balance is required between government and private enterprise. The intervention of government is warranted where profit cannot necessarily be extracted by private companies.

For example education is a prime example. While there is a market for superior private education, there is no incentive to companies to provide free education to those who cannot afford it. However, the state has a longer term financial interest in decent education for all in that an educated workforce is more productive and pays more tax.

However, the "invisible right hand of competition" using economics of scale will forever out perform the small scale "local" producer, unless the local producer discounts the value of his time, and farms for pleasure rather than profit.

The sale of public production assets has almost without fail resulted in the increase in productivity and the reduction in the cost of production.

What about self-ownership? Is that "theft" of a "common resource"? Does the community own you? Do you own other people?

If a woman won’t agree to have sex with a man unless he spends scarce resources of time on her, does that mean she’s exploiting him because she’s excluding him? Her body should be owned by everyone in common?

What about the fruits of your labours? Does everyone else have more of a title to them than you do? How did they get it?

What about the things you get through voluntary exchanges of the fruits of your labour? Is that theft of common resources? How did the community get more of a title to them than you?

I think you’ve got things back-the-front.

So according to you, private property means exclusion which means exploitation. There should be no private property? But there should be no coercion either? So how would you like to see production working in the good society?