Bryan Caplan  

Betting, Liberty, and the Status Quo

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I claim that betting stifles hyperbole, the fuel of Big Government.  In this sense, my Betting Norm has an underlying libertarian agenda.  One could object, however, that killing hyperbole is a double-edged sword.  Sure, it deprives statists of the chance of oversell government.  But it also deprives libertarians of the chance to oversell liberty.  If hyperbole dies, isn't the status quo the real winner?

Not really.  In the modern world, economic growth is the norm.  So as long as government's absolute size stays fixed, economic growth steadily erodes government's role in society.  And over time, every new industry that the government failed to foresee is at most lightly regulated.

Furthermore, entrepreneurs and scofflaws are constantly looking for clever ways to circumvent existing laws.  As long as regulations stay fixed, their practical impact naturally shrinks year after year.  Imagine what the United States would look like today if governments stopped passing new laws in 1970.  Airline and trucking regulation would still be on the books, but they'd be pretty easy to dodge with the help of the internet.  It wouldn't be Libertopia, but it would be a lot more libertarian than our status quo.

So does the betting norm favor the status quo or liberty?  Both.  It favors the legal status quo.  Over time, however, a stagnant legal status quo naturally decays into de facto laissez-faire.




COMMENTS (6 to date)
Yaakov writes:

Thanks Bryan. I very much enjoyed both this and the previous post.

ThomasH writes:

It's an interesting vision and the tendency of regulations to "decay" (Uber undermines taxi regulations) is valid, I think.

But I also think that lot's of "government" could happen without hyperbole. DC just expanded the number of occasions (higher expected overnight low temperature) on which it will pick up homeless people to take them to shelters overnight. So far as I know there was no claim that even scores of lives would be saved that having to bet would have tamped down. The news did not even mention what the cost was so there was no claim that it would cost only $X, so again no purchase for a bet to have encouraged a more defensible claim. So for good or ill I do not think this would have been less likely to happen in a betting-constrained world of claims to reinforce the status quo.

As for the big ticket items like ACA, there have been plenty of negative claims about it too. I can see that we could have had a better debate about it, but I'm not sure it would not have passed anyway.

I can see this working to restrain certain kinds of measures -- anti GMO legislation? -- all to the good, but overall I do not think there wold be much restraint or acceleration of the growth in government activity, just better activity.


Miguel Madeira writes:

"In the modern world, economic growth is the norm. So as long as government's absolute size stays fixed, economic growth steadily erodes government's role in society."

But, by another hand, most countries have progressive taxation, meaning that the tax share of GDP will grow automatically when a country becames richer.

ThomasH writes:

In the same spirit:

http://www.washingtonpost.com/blogs/monkey-cage/wp/2015/09/30/pundits-are-regularly-outpredicted-by-people-youve-never-heard-of-heres-how-to-change-that/

[The link did not work when clicked in preview. Sorry, I don't know what to do about that.]

Jameson writes:
Over time, however, a stagnant legal status quo naturally decays into de facto laissez-faire.
That's a really clever insight. On the other hand, it starkly reminds us why libertarianism is so often taken for a form of conservatism.
ThomasH writes:

@Jameson

On the other hand, it starkly reminds us why libertarianism is so often taken for a form of conservatism.

And just in time, as US "conservatism" has been taken over by foreign policy hawks, Christinists, and Constitutional bomb-throwers like the "debt ceiling" stunt, which if actually executed would instantly transfer to the excutive the power to decide which of Congresses spending instructions are carried out.

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