– Julian sensibly argues for limiting the First Amendment to the protection of porn, and shutting down all that noisome political speech altogether. Funny, cutting piece.

– Mainstream economic theory just assumes a market and just assumes a state that can correct market failures and provide for public goods. But the world doesn’t work this way, and it’s a problem that some economists think it does.

There are always markets of some sort or other. But they’re fairly primitive and limited except under pretty special conditions. And there’s not always an agency that can provide public goods through a system of public finance. Most places try to set one up, but it often doesn’t work because people don’t like to pay taxes, and the people who are supposed to collect them end up stealing the money, or the people running the state steal the money and buy themselves palaces, or warehouses of rocket propelled grenades, instead of building a sewage system like they said they would.

If G is a public good, and M is a mechanism for providing G, then M is a sort of public good, too, and so are the conditions for the functioning of M. If M requires tax compliance, and non-predation and non-corruption by agents of the state, then those things are what we might call higher order public goods. And we get these things by getting even higher order goods, like a certain socially prevalent level of trust, a not-too-high discount rate on future value, and the internalization of certain kinds of social norms. If we think of THESE things as higher order, and logically prior, kinds of public goods, then we’ll get over thinking of public goods as things that states provide. For in order for states to provide anything other than abuse, these things have to already be in place. We’ll also get over thinking of public goods as things that markets can provide better than states, because these are precisely the sorts of things that have to be in place in order for markets to work in anything other than a very limited and atrophied way. In order for markets to do much by way of providing lighthouses, to take a famous example, the market has to be developed enough to coordinate complex enforceable agreements. Getting to that point is itself a big achievement.

We need to get over stipulating ideal markets and ideal states, and work harder at understanding how even partially functional markets and states get to be partially functional, as opposed to fully non-functional, in the first place. How do higher order public goods like prosperity-conducive belief systems and social norms ever get going? How can you ever get a predation-limiting constitution that people don’t just ignore?

That’s what I want to know. Now, hurry!

– Tyler Cowen discusses a poll of members of the Public Choice Society…

When you ask (a broader group of) economists whether markets, in the absence of transactions costs, achieve efficient outcomes, 57.1 percent say yes. This is itself odd, since I would interpret the proposition as a tautology, but it appears some people simply can’t bring themselves to praise the market. 70.3 percent of the public choice economists say yes, showing that this group has a stronger belief in markets. 22 percent of the surveyed political scientists say yes, showing a far greater skepticism about the market economy from those quarters.

No doubt Tyler’s right in that some folks are just loathe to say anything positive about the market. But I’ve got a different take on the results. As Tyler says, it’s a tautology that the market is efficient given zero transactions costs. That’s right. But given that that’s right, it’s not really PRAISE to say that zero transactions costs markets are efficient. It’s just definitional, given the assumptions of the model. So isn’t the correct interpetation of the poll that some economists, and most political scientists, don’t understand the model? Public choice economists understand economics better than economists as a whole, and political scientists are clueless. That’s my interpretation.

– Well, it looks like we may have more or less beat the smoking ban. But it’s not over yet. The vote has yet to be scheduled, as far as I know, and there’s the opportunity for a lot of politicking before then. So vigilant we must remain.

Yesterday’s Council hearing made plain who the banners are: political operatives, professional public health fascists, and dimwitted puritan scolds clearly shaken by the possibility that somewhere someone might be enjoying himself. Smoke-Free DC’s vastly superior funding could not keep their speakers from coming off as arrogant, censorious, moralizing busybodies, infatuated with any bit of junk science that might reinforce their pinched, joyless weltanschaung. The Ban the Banners, on the other hand, came off as fun, articulate, intelligent people who do not consider it a categorical duty to live as long as possible, but who think it’s damn nice to live as well as possible, as long as one happens to live. Not only were our arguments better, but we showed ourselves to be better human beings. And cooler, too.

The restaurant and bar owners were simply amazing. Dante Ferrando of the Black Cat made his point loud and clear. The Cat is his private property. He owns the building. He owns the land it sits on. And the reason he owns it is that he likes to drink, he likes to smoke, he likes to rock, and he likes to surround himself with smoking, drinking, rocking people. His dream was to build a community, a family, united by a lifestyle. And he’s succeeded… so far. But the ban would cripple his business, and destroy his family. John Arce, a bartender at the Cat, noted that some members of the Council can’t seem to tell the difference between a public elevator and a private club (and, in good DC socialist-punk fashion, said that if the Council really wants to help him, it can institute a universal health plan.)

Cici Mukhtar, owner of Polly’s Cafe, made a point I hadn’t thought of before. She says she’s trying to open a second Polly’s, perhaps up on Georgia Ave. In order to do it, she needs a loan from a bank, and banks don’t care about “public health” policy, they just want to get their money back. And Banks are smart. They know that a smoking ban could hurt business. If a ban goes in place, Cici won’t be able to finance her new Cafe. And neighborhoods that would be helped by new business will have to go without.

Stephen Greenleigh shared the witness table with me and Justin Logan. His testimony was heartbreaking. He runs a chain of hotels in DC. Since 9/11, they’ve been struggling. He said every time a “Code Orange” alert goes out, his switchboards light up with cancellations. He said his businesses have taken one hit after another, and some of them are losing money. But he won’t close them, because he cares too much about the employees, and maybe, MAYBE, they’ll be able to pull through. But Mr. Greenleigh was downcast. With emotion in his voice, he said he wasn’t sure how he’s going to make payroll this month. The smoking ban would be just one more hit, and quite probably the last one. Unlike the bureacratic prohibitionists, Mr. Greenleigh, a businessman, understands margins. He is not bouyed by the fact that over time the macro effects of the ban may not be negative. If his business dips because of a smoking ban, that’s it, he’s done.

I’d be remiss if I failed to mention Allan Jirikowic, owner of Chief Ike’s Mambo Room, a bushy-faced, voluble, bearlike man of simply amazing wit and spirit. I can’t begin to do justice to his hilarious, satirical testimony. (To employee, shouting: “Don’t you know that Robert Wood Johnson is doing this FOR YOUR OWN GOOD!!!”) If I could put a face on the anti-prohbitionists, it would be Allan Jirikowic’s fat, happy, smiling-eyed, hairy face. This is a man who loves his business, who loves his employees, loves to laugh, and lusts for life. He doesn’t smoke himself. But he understands that some people ENJOY it. And he’s in the business of helping people enjoy themselves. It’s what he does, and you can tell he loves it. The prohibitionists are in the business of saving people from enjoyment. Judging from their earnest, crabbed, whining performance at the hearings, they’ve done a wonderful job of saving themselves.

[For your listening pleasure, I've recorded my super-cheesy testimony from the hearing, here.]