Why we're a divided nation

Recent elections pointed to deepening divisions among American people, but has anyone given serious thought to just why? I have part of the answer, which starts off with a simple example.

Different Americans have different and intensive preferences for cars, food, clothing and entertainment. For example, some Americans love opera and hate rock and roll. Others have opposite preferences, loving rock and roll and hating opera. When's the last time you heard of rock-and-roll lovers in conflict with opera lovers? It seldom, if ever, happens. Why? Those who love operas get what they want, and those who love rock and roll get what they want, and both can live in peace with one another.

Suppose that instead of freedom in the music market, decisions on what kind of music people could listen to were made in the political arena. It would be either opera or rock and roll. Rock and rollers would be lined up against opera lovers. Why? It's simple. If the opera lovers win, rock and rollers would lose, and the reverse would happen if rock and rollers won. Conflict would emerge solely because the decision was made in the political arena.

The prime feature of political decision-making is that it's a zero-sum game. One person or group's gain is of necessity another person or group's loss. As such, political allocation of resources is conflict enhancing while market allocation is conflict reducing. The greater the number of decisions made in the political arena, the greater is the potential for conflict.

There are other implications of political decision-making. Throughout most of our history, we've lived in relative harmony. That's remarkable because just about every religion, racial and ethnic group in the world is represented in our country. These are the very racial/ethnic/religious groups that have for centuries been trying to slaughter one another in their home countries, among them: Turks and Armenians, Protestant and Catholic, Muslim and Jew, Croats and Serbs. While we haven't been a perfect nation, there have been no cases of the mass genocide and religious wars that have plagued the globe elsewhere. The closest we've come was the American Indian/European conflict, which pales by comparison.

The reason we've been able to live in relative harmony is that for most of our history government was small. There wasn't much pie to distribute politically.

When it's the political arena that determines who gets what goodies, the most effective coalitions are those with a proven record of being the most divisive -- those based on race, ethnicity, religion and region. As a matter of fact, our most costly conflict involved a coalition based upon region -- namely the War of 1861.

Many of the issues that divide us, aside from the Iraq war, are those best described as a zero-sum game, where one group's gain is of necessity another's loss. Examples are: racial preferences, Social Security, tax policy, trade restrictions, welfare and a host of other government policies that benefit one American at the expense of another American. You might be tempted to think that the brutal domestic conflict seen in other countries at other times can't happen here. That's nonsense. Americans are not super-humans; we possess the same frailties of other people in other places. If there were a severe economic calamity, I can imagine a political hustler exploiting those frailties here, just as Adolf Hitler did in Germany, blaming it on the Jews, the blacks, the East Coast, Catholics or free trade.

The best thing the president and Congress can do to heal our country is to reduce the impact of government on our lives. Doing so will not only produce a less divided country and greater economic efficiency but bear greater faith and allegiance to the vision of America held by our founders -- a country of limited government.

Yes.
Cheap Chinese goods made by slave labor are flooding Western markets.

It is true that plantation slavery in the South was not terribly profitable (though it was not the economic dog it is often depicted as either), but agriculture is limited by per acre crop yields, and since slaves could be bought or sold, and other Christian considerations limited what plantation owners could do, this was not comparable to China.

In China, the state makes no pretence of having to provide for the prisoner slaves cradle to grave. They are work units to be used. If they die, there are more prisoners. If they underproduce, they are starved. If this makes them underproduce more, they are allowed to starve to death as an example to the others. The work they do is manufacturing of low-tech stuff, so there is no natural limitation on output (such as the per-acre crop yield limitations in the Old South).

And the proof that this sort of slavery - where the slave is simply worked to death and replaced by another slave from a limitless population - is effective is the way that these cheap slave-made goods out of China are clobbering the competition.

Historically, one has to go all the way back to the Roman Empire to find a comparable situation. When the slave masters have no regard at all for the lives of their slaves, and have no compunction about killing them, starving them, torturing them, etc, simply as an example for other slaves, and where human life is so cheap and abundant that slaves are more easily replaced with another slave than nursed and repaired back to health when they are broken or get sick...you have the makings of a Roman or Chinese situation. Roman style slavery was effective. Unbelievably brutal, but effective. The proof is the sheer power of the Roman Empire, whose core areas were all a slave-based agricultural economy.
The modern proof is the competitive advantage China has in the export of small cheap widgets. China makes them for free, because as far as the Communist government is concerned, starving a laborer to death and tossing him in the rice paddy behind the prison (after harvesting his skin and corneas, of course) is free, and there are always more prisoners.

One cannot underprice manufacturers who can torture and kill their workers to mass produce simple widgets. And the incentive of being given FOOD for making a production quota, or being STARVED for missing it, has proven more than sufficient to keep the Chinese production lines moving.

In the South, Christianity imposed real limits on the slave owners. China ain't Christian. And no American widget manufacturer, or for that matter an Indonesian or Mexican one, has a hope in hell of competing with manufacturers who can chain their labor to the machines and use food as the incentive to work. China's ascendancy is built on bones. But it IS an ascendancy. And it will continue to be so unless LEGAL barriers are erected against Chinese goods made in this way. They will always be cheaper and abundant. There is no market force that can beat such goods. You simply have to ban them from entering the market, unless you want to have more slavery in China. They won't do it if they can't sell the goods.

Cheap Chinese goods made by slave labor are flooding Western markets.

What fraction of these goods are produced by slaves or prisoners? And what fraction are produced by people who simply work for wages that are low by Western standards?

It is true that plantation slavery in the South was not terribly profitable (though it was not the economic dog it is often depicted as either), but agriculture is limited by per acre crop yields, and since slaves could be bought or sold, and other Christian considerations limited what plantation owners could do, this was not comparable to China.

I am not convinced that "Christian considerations" did much to moderate the evils of plantation slavery in the old South. Be that as it may, my original question still stands: Are slaves more efficient or productive than free people? Specifically, was nineteenth century agriculture more efficient or productive in slave states than in free states?

In China, the state makes no pretence of having to provide for the prisoner slaves cradle to grave. They are work units to be used. If they die, there are more prisoners. If they underproduce, they are starved. If this makes them underproduce more, they are allowed to starve to death as an example to the others. The work they do is manufacturing of low-tech stuff, so there is no natural limitation on output (such as the per-acre crop yield limitations in the Old South).

This sounds awful, but is it true generally? I have no illusions about the evil inherent in a Communist state such as China. Nevertheless, it is hard to believe we have much to fear from an economy that operates this way. They might succeed for a time in producing "low-tech stuff," but that is not the way to build a modern economy.

And the proof that this sort of slavery - where the slave is simply worked to death and replaced by another slave from a limitless population - is effective is the way that these cheap slave-made goods out of China are clobbering the competition.

This is no proof at all. You have not shown that this is how most Chinese firms operate, that this approach is efficient, or that Chinese manufacturing really is "clobbering" the competition. You also fail to explain how other low-wage countries have managed to compete with the Chinese without the "benefits" of slave labor.

Historically, one has to go all the way back to the Roman Empire to find a comparable situation. When the slave masters have no regard at all for the lives of their slaves, and have no compunction about killing them, starving them, torturing them, etc, simply as an example for other slaves, and where human life is so cheap and abundant that slaves are more easily replaced with another slave than nursed and repaired back to health when they are broken or get sick...you have the makings of a Roman or Chinese situation. Roman style slavery was effective. Unbelievably brutal, but effective. The proof is the sheer power of the Roman Empire, whose core areas were all a slave-based agricultural economy.

What is your source for this description of Roman slavery? It does not accord with what I have read. However, I am no expert in ancient history, so I must leave that to those who are.

Even so, my original question remains: Are slaves more efficient or productive than free people? Were Roman slaves more productive than free Romans?

The modern proof is the competitive advantage China has in the export of small cheap widgets. China makes them for free, because as far as the Communist government is concerned, starving a laborer to death and tossing him in the rice paddy behind the prison (after harvesting his skin and corneas, of course) is free, and there are always more prisoners.

So the Chinese make no profit on their widgets, but make up for that in volume? That sounds like a formula for economic disaster.

The profit margin cannot be a large one on cheap widgets.

In the South, Christianity imposed real limits on the slave owners. China ain't Christian. And no American widget manufacturer, or for that matter an Indonesian or Mexican one, has a hope in hell of competing with manufacturers who can chain their labor to the machines and use food as the incentive to work. China's ascendancy is built on bones. But it IS an ascendancy. And it will continue to be so unless LEGAL barriers are erected against Chinese goods made in this way. They will always be cheaper and abundant. There is no market force that can beat such goods. You simply have to ban them from entering the market, unless you want to have more slavery in China. They won't do it if they can't sell the goods.

Cheap and abundant are no good if the quality is low. And what kind of quality can one expect from a worker who is chained to the machine and kept on the edge of starvation?

By the way, I would be interested to know in what ways "Christianity imposed real limits on the slave owners."

Moving through the parts:

In the South, Christianity prevented the rise of public torture for entertainment. That is what the Roman Colosseum was. In the South, slave owners felt the need to Christianize their slaves, and they did. In the South, slaves were punished for disobedience, but were generally not murdered for the hell of it. There was a mental barrier against simply killing slaves because they pissed somebody off.
There was almost certainly a lot more death inflicted on Southern blacks in the era of lynching (c. 1880-1910) than in the slave era.

Are free people more productive? Generally, yes. Northern food farms were more productive than Southern slave plantations, for example. Free labor does tend to be more productive per acre. But that does not mean that it is competitive. In the Roman Empire, freehold farmers were squeezed out by the great slave plantations because the great landowners had the advantage of vast economies of scale. Yes, one acre of free land was more productive than an acre of slave land, but two acres of slave land are more productive than one acre of free land, and there is a natural limit to the number of acres that a single farmer can farm. He has to feed himself and his family, and maintain a certain standard of life. The slave could be - and generally was - kept nearly naked and fed enough to keep up his strength, but paid nothing.

Likewise in the States. In the Southern states, there was no freehold competition with the great slave plantations for export crops. Why? Not because it was illegal to set up a freehold farm and farm it with free labor. Because a slave plantation brings a lot more profit to the owner than a freehold plantation.

As to China, giving exact statistical proof of any assertion I made is impossible. China hides that it does this, dissembles about slave labor. Pretends that things are otherwise. It is impossible to gather the data, because it is illegal to collect it there, and the whole slave economy is hidden. We know about it from the survivors. The same was true of the Soviet Gulag and Nazi Germany.

I don't think that historically we would have been better off having a free trade regime with the Nazis or with the Soviets. But at the time that those regimes were in place, it was not possible to get objective data out of them, and it was always possible to deny that the places were really as bad as people said they were. One simply had to trust that survivors and refugees were telling the truth.

Now, I do trust that the survivors of Chinese slave camps are telling the truth, and that the reports, never very specific (and therefore never allowing definitive proof or quantization of the facts) that come out of China of millions of prison slaves making widgets for export is true. Maybe it's all calumnious lies by people with an axe to grind against the Chinese regime. I doubt it, but maybe.

Anyway, free labor is more productive, all things being equal. But that does not mean that free farms are more profitable to the owners. Look at society as a whole, and certainly the American North was more robust and prosperous than the American South before the War. But people do not live collectively but individually. And on an individual basis, the Southern slaveholding class was an aristocratic elite enjoying wealth and privilege unmatched within America, not just in absolute terms - wealthy plantation owners were on a par with certain Northern railroadmen and proto-industrialists, but in relative terms. No Northern industrialist had the power to whip his laborers, or to force himself upon their wives, to be bowed and scraped to, and to live like a Lord of the Manor, because the Northern industrialist was a rich guy, but the Southern plantation owner WAS the Lord of the Manor.
Was that good for Southern society as a whole?
No.
Was it BETTER, for a sizeable chunk of Southern society, than any more egalitarian system?
Much. And it would have stayed that way too, absent a violent upheaval.
The House of Saud, or the apparatchiks of the Chinese Communist Party, live much better lives under the current regime than they will ever manage would those countries become free market democracies.

Now, over time, in the long run, the freer societies tend to win out. (Not always. France, Holland, Belgium, Denmark, Norway, Luxembourg and Austria all lost to Germany, and England was on its way to losing too. But for foreign intervention, fascism or communism would have overwhelmed free market capitalism in Europe.) But that long run can take a long time, and we don't have an extended time period in history to look back across and see a true free market working anywhere to be able to gauge our models. We say, for example, that Britain was a free market state back in the 19th Century, but that's not true. Britain conquered its markets and didn't let anyone else sell there. Nor did Britain permit its colonies, like India, to produce goods that would compete with British industry. So yes, Britain allowed a great degree of free importation into Britain, from places like France and Germany and the US. But Britain did NOT allow the French to export into India, or the Americans to export into Kenya. Nor did the British let the Indians produce textiles to compete with their goods, nor let the Chinese opt to NOT import opium. The classic case study of the free market usually cited, the British Empire, was anything but.

I sound like I am arguing against the free market. But I am not. I am arguing that the free market is a good thing, but that it cannot be an unregulated free market.

As you said, moving through the parts:

In the South, Christianity prevented the rise of public torture for entertainment. That is what the Roman Colosseum was. In the South, slave owners felt the need to Christianize their slaves, and they did. In the South, slaves were punished for disobedience, but were generally not murdered for the hell of it. There was a mental barrier against simply killing slaves because they pissed somebody off. There was almost certainly a lot more death inflicted on Southern blacks in the era of lynching (c. 1880-1910) than in the slave era.

You may be right that Christianity prompted slaveowners in the South to refrain from killing or otherwise mistreating their slaves. However, a cynic might ascribe their restraint to baser motives: a slave represented a considerable investment, and it would not make good business sense to destroy one's investment. (Your comment about lynching would suggest that Christian motives did not run deep.)

Are free people more productive? Generally, yes. Northern food farms were more productive than Southern slave plantations, for example. Free labor does tend to be more productive per acre. But that does not mean that it is competitive. In the Roman Empire, freehold farmers were squeezed out by the great slave plantations because the great landowners had the advantage of vast economies of scale. Yes, one acre of free land was more productive than an acre of slave land, but two acres of slave land are more productive than one acre of free land, and there is a natural limit to the number of acres that a single farmer can farm. He has to feed himself and his family, and maintain a certain standard of life. The slave could be - and generally was - kept nearly naked and fed enough to keep up his strength, but paid nothing.... Anyway, free labor is more productive, all things being equal. But that does not mean that free farms are more profitable to the owners.

Your argument puzzles me. I would have thought that "vast economies of scale" imply higher efficiency and greater profits. If ten freehold farmers can produce more per acre than ten slaves, it would seem that the former will be more profitable than the latter. As you say, the free farmers have to support themselves and their families; but the slaves (who produced less) had to support themselves, their families, and the slave owner's family.

My knowledge of Roman economic history is limited, but I seem to recall that high taxation was one reason smaller farmers were squeezed out. Some were forced to sell themselves into slavery to pay the taxes. Perhaps someone who knows more about this period of history can confirm this.

As to China, giving exact statistical proof of any assertion I made is impossible. China hides that it does this, dissembles about slave labor. Pretends that things are otherwise. It is impossible to gather the data, because it is illegal to collect it there, and the whole slave economy is hidden. We know about it from the survivors. The same was true of the Soviet Gulag and Nazi Germany.

Since neither of us has data on the extent of the Chinese prisoner-labor economy, we are both guessing. But your comment about the Soviet Gulag and Nazi Germany would tend to support my belief that free people will always out-produce slaves. Both systems resulted in a huge waste of lives and resources. That is one reason why both no longer exist.

Now, I do trust that the survivors of Chinese slave camps are telling the truth, and that the reports, never very specific (and therefore never allowing definitive proof or quantization of the facts) that come out of China of millions of prison slaves making widgets for export is true. Maybe it's all calumnious lies by people with an axe to grind against the Chinese regime. I doubt it, but maybe.

I do not doubt for an instance the existence of a vast prison system in China. What I doubt is that all or even most of China's exports are produced in that system. If the Chinese economy really does rest on prison labor, we have little to fear that they will be able to out-compete us for long.

No Northern industrialist had the power to whip his laborers, or to force himself upon their wives, to be bowed and scraped to, and to live like a Lord of the Manor, because the Northern industrialist was a rich guy, but the Southern plantation owner WAS the Lord of the Manor. Was that good for Southern society as a whole?
No.
Was it BETTER, for a sizeable chunk of Southern society, than any more egalitarian system?
Much. And it would have stayed that way too, absent a violent upheaval.
The House of Saud, or the apparatchiks of the Chinese Communist Party, live much better lives under the current regime than they will ever manage would those countries become free market democracies.

You have explained why some people support bad economic policies, no matter how counter-productive they may be.

Now, over time, in the long run, the freer societies tend to win out. (Not always. France, Holland, Belgium, Denmark, Norway, Luxembourg and Austria all lost to Germany, and England was on its way to losing too. But for foreign intervention, fascism or communism would have overwhelmed free market capitalism in Europe.)

You seem to have changed your argument here. Fascism and Communism were not economic threats to the free market; they were military and political threats.

The classic case study of the free market usually cited, the British Empire, was anything but.

Is this an argument for or against the free market?

I sound like I am arguing against the free market. But I am not. I am arguing that the free market is a good thing, but that it cannot be an unregulated free market.

There's the rub. How much regulation can a free market stand before it ceases to be free?

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