Capitalism Unbound

Andrew Bernstein has written a new book called Capitalism Unbound that, in his words:

...offers a focused, essentialized, and condensed argument ideal for the layman who admires capitalism but lacking a succinct, accessible explanation of its moral and economic virtues.

I have just finished reading it and I heartily agree. The book is an excellent shorter and updated presentation of the historical, moral and economic case for capitalism already presented in his book The Capitalist Manifesto. It is, as Dr. Bernstein put it on Facebook, "best book [he's] ever written." I think the organization of the book, in particular, is very effective in conveying the link between the historical facts and the ideas, both moral and economic. There is also enough myth busting to challenge those unfamiliar with the details of economic history, particularly the history of pre-capitalist and early capitalist eras. There are also interesting thoughts on charity as well.

Highly recommended!

What is the proper response to Climate Change?

Keith Lockitch has announced the publication of an important paper by him in the journal Energy & Environment. The paper is entitled "CLIMATE VULNERABILITY AND THE INDISPENSABLE VALUE OF INDUSTRIAL CAPITALISM" and is available online. The abstract is as follows:

It is widely believed that man-made greenhouse gas emissions are increasing overall vulnerability to climate-related disasters, and that, consequently, policies aimed at cutting off these emissions are urgently needed. But a broader perspective on climate vulnerability suggests that the most important factors influencing susceptibility to climate-related threats are not climatologic, but political and economic. The dramatic degree to which industrial development under capitalism has reduced the risk of harm from severe climate events in the industrialized world is significantly under-appreciated in the climate debate. Consequently, so too is the degree to which green climate and energy policies would undermine the protection that industrial capitalism affords–by interfering with individual freedoms, distorting market forces, and impeding continued industrial development and economic growth. The effect of such policies would, ironically, be a worsening of overall vulnerability to climate.

I have read the paper and, somewhat reminiscent of Andrew Bernstein's excellent book The Capitalist Manifesto, it reminds readers that it is capitalism (in as near a form in which we live under it) that has been responsible for the elimination of much of our historic vulnerability to natural threats, including climate change.

This is a crucial point that advocates of restrictions on CO2 emissions, whether innocently or not, completely miss. Recently I engaged in an online exchange on the whole topic of environmentalism and climate change in particular with someone who is sympathetic to environmentalism. I decided that the crucial point to get across was not primarily that the science behind many of the environmentalist claims is suspect (though I mentioned that as well). Instead, I focused on man's ability to handle any potential natural or artificial changes voluntarily and technologically rather than by forceful imposition of restrictions. That shifted the discussion from the details of science which neither of us was particularly qualified to evaluate without much further research, to moral values, which it turned out my friend chose not to get into. I think that's exactly where the debate should be.

Private Disaster Response

In an article entitled Rapture Rescue 911: Disaster Response for the Chosen on TheNation.com, Naomi Klein solves a problem I've been thinking about during every recent natural disaster, and in particular the recent Southern California fires. Is it realistic to expect that in laissez-faire capitalism there will be private fire companies and emergency response companies that will be able to help people during natural disasters? It seems as there should be, since people ought to be willing to pay for these kinds of services just as they pay for insurance, but I tend to prefer to see at least some evidence for these assumptions. I had previously heard of occasional privatized fire departments in small towns but nothing larger than that. I had not heard of this:

Members of the company's Private Client Group pay an average of $19,000 to have their homes sprayed with fire retardant. During the wildfires, the "mobile units"--racing around in red firetrucks--even extinguished fires for their clients.
...
During last year's hurricane season, Florida homeowners were offered similarly high-priced salvation by HelpJet, a travel agency launched with promises to turn "a hurricane evacuation into a jet-setter vacation." For an annual fee, a company concierge takes care of everything: transport to the air terminal, luxurious travel, bookings at five-star resorts. Most of all, HelpJet is an escape hatch from the kind of government failure on display during Katrina. "No standing in lines, no hassle with crowds, just a first class experience."

HelpJet is about to get some serious competition from some much larger players. In northern Michigan, during the same week that the California fires raged, the rural community of Pellston was in the grip of an intense public debate. The village is about to become the headquarters for the first fully privatized national disaster response center. The plan is the brainchild of Sovereign Deed, a little-known start-up with links to the mercenary firm Triple Canopy. Like HelpJet, Sovereign Deed works on a "country-club type membership fee," according to the company's vice president, retired Brig. Gen. Richard Mills. In exchange for a one-time fee of $50,000 followed by annual dues of $15,000, members receive "comprehensive catastrophe response services" should their city be hit by a manmade disaster that can "cause severe threats to public health and/or well-being" (read: a terrorist attack), a disease outbreak or a natural disaster. Basic membership includes access to medicine, water and food, while those who pay for "premium tiered services" will be eligible for VIP rescue missions.

Ms. Klein, of course, sneers at all this and apparently takes for granted that people have a right to equal disaster assistance that should be provided free of charge. But leaving aside the sneers, I really think this is an awesome demonstration of the power of the market, hampered though it is, to provide services that people are willing to pay for, including services typically assumed to be the exclusive domain of the government.