Singaporean Sense

Well - on the other hand, they did ban chewing gum because of the negative externalities:

http://en.wikipedia.org/wiki/Chewing_gum_ban_in_Singapore

But for me, the deal-breaker is far more mundane: Singapore has conscription.

A similar two-year subscription idea already hovers at the gates of mainstream US politics. The Volokh Conspiracy looked at the "Service Nation" plan endorsed by a number of leading politicians. Service Nation statements frequently indicate a long-term plan for mandatory service:

"The secondary goal of Service Nation is to set America on a trajectory to become a nation of universal national service by 2020."

This quote was removed from their website when brought to their attention, but as Ilya Somin points out, other quotes have indicated the same goals.

Sorry, should have been 'conscription'.

How, exactly, could you migrate a conscription system to an all-volunteer system?

Currently, everyone in Singapore must serve for two years. This can be divided into three groups.

1. People who are good enough and would volunteer.

2. People who are good enough but would not volunteer.

3. People who are not good enough.

When you switch to an all-volunteer system, you lose some of group 3, but all of group 2. This inevitably reduces military might. The answer to this in an all-volunteer system is to offer incentives that reduce the size of group 2 by encouraging them to volunteer, but this increases the cost of military forces overall.

It's a tough problem. You can't just walk away from the status quo without consequences.

Caliban--somehow, the U.S. managed to switch, so it's clearly not impossible. I'm not sure I follow much of your argument either. What exactly are people who "aren't good enough"? Are they currently exempted from service? If so, no loss. If not, they must have some value, and there's no reason they couldn't volunteer to serve. And of course your calculations ignore the loss of value of 2 years of a man's life that he'd preferably rather spend doing something else. There's no other job that we think is best done by slave labor; I see no reason why the military should be any different.

Back to the main point: I think Brian is way too kind on the Singaporean economists. We shouldn't be grading on a curve when human lives are at stake. "We may be able to find an acceptable way ... without ... hurting the sensitivities of others." Since when do the sensitivities of others matter worth a rat's ass?

A man is drowning in a raging river; the rapids have also ripped off his clothing. Rather than rescuing him immediately, emergency workers dither for minutes on how best to pull him up without exposing his private parts to the onlookers, possibly offending their delicate sensibilities. And what if people get grossed out when we give him CPR? It kind of looks like two men kissing--gross!

If we were giving a fair report card on the organ selling issue, Iran would get a D-, Singapore an F+, and every other country in the world an F-. Thousands of people are dying because of economic ignorance, anti-market bias, and nonsensical sensibilities. Let's not praise Singapore too highly just because their bureaucrats are considering allowing a small subset of transactions that should be a fundamental human right.

From a purely economic perspective, you are right. Conscription is inefficient and a violation of basic rights. However, pure economic perspectives are not perfect and I think that this is one case where they break down. Consider some of the most economically literate governments in the world. To my knowledge, that would be Singapore, Switzerland, Liechtenstein, and Hong Kong.

Now notice that Singapore and Switzerland both have mandatory military service. Liechtenstein's constitution prohibits a military but it gets most of its security (and population) from Switzerland and so does not really count in this analysis. Then consider Hong Kong. It does not have any of its own military but its parent government, China, does and China does have a program of mandatory military service. Furthermore, notwithstanding China's past status as a communist state, its current government is far from complete dolts when it comes to economic issues.

Now admittedly, anecdote is not evidence and correlation does not imply causation. However, I think that mandatory military service forces people off the destructive mentality that they inherently deserve to have housing medical care and that if they can't earn enough for these services, the government should provide them for free. In effect, military service forces the citizens to abandon the concept of a paternalistic government. This is reflected in the strong emphasis on individual incentives in Singapore's health care policy.

I don't think that mandatory military service can just be written off as inefficient and an invasion of civil rights without further study. This would be an interesting subject to research.

How, exactly, could you migrate a conscription system to an all-volunteer system?
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I am a Singaporean who understand economics.

An important intermediate step that might help the move is to start paying every conscripted soldier in Singapore the "market wage".

It can be the salary a typical high school graduate would earn in Singapore, around S$1000 which would be about US$750.

Currently, they are only paid an allowance of about US$200 to 300.

This move would go a long way in discouraging the inefficient use of our poor conscripts, such as making them rehearse seven or more times for a National Day Parade.

Now if they could just stop caning people for chewing gum...

"How, exactly, could you migrate a conscription system to an all-volunteer system?"

Pay for soldiers.

Hmm, getting invaded by your bigger stronger neighbours is a pretty big market failure isn't it? There's only so far you can take free market purism.

As Milton Friedman would say, the issue of conscription is not so much an economic one as a moral one. This is slavery to the state, and unlike Jury Duty - its hazardous slavery.