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Debate question: Libertarianism and Monopolies

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May. 21st, 2010 | 10:26 am
mood: contemplativecontemplative

Rand Paul made a rookie mistake on hitting the national scene by stating extremist views honestly and unequivocally. Naturally, he is getting a lot of national attention for his fundamental libertarian argument - that government shouldn't have the ability to interfere with a privately-run business (i.e. would have voted against the Civil Rights act) but that government itself should not discriminate against citizens for reasons of race, creed, etc...

Ignoring Rand Paul's attempts to mitigate the interpretation of his convictions by trying the nuanced "I'm against racism in all forms but would not let the government stop it" argument, I have to say that I do understand the logic behind his argument. If I run a private club or a store, I should be allowed to refuse service to someone who would be disruptive or whose finances are questionable or who isn't dressed properly for my establishment. And, yes, even if I don't like that person's race. Abhorrent, but shouldn't be restricted. However, here are the scenarios where the argument becomes difficult that Paul doesn't really address:

  • Utilities, such as power, waste disposal, and cable, are becoming increasingly privatized. If I am the only supplier of a service and I refuse to deliver power to a neighborhood because "they represent a population that are not likely to pay their bills" but really because that neighborhood is a minority one, should the government force me to deliver that service? I could be sued but if I haven't broken any laws then that lawsuit might be hard to win.

  • If I am a minority living in a community where gas stations, supermarkets, etc. refuse to take my money, then I could open my own business. However, if banks refuse to give me a small business loan or I can't rent any space for the same reasons, then I'd be forced to move. Now, if I couldn't afford to move, then what are the free market mechanisms that offers a correction in this case.

  • In both these cases, they represent cases where a monopoly (or a collective monopoly) can create a situation that we might morally call socially unjust and where government has very little recourse to correct if we had a government run by Paul's rules.

    I do believe that society is more efficiently run if decision-making is pushed down to individuals or small groups. But, there are cases where a large amount of collective damage can be caused if those individuals and groups have enough collective influence to cause significant harm. I'm trying to figure out where the line should be drawn, if any. I don't believe that a society based solely on libertarian values can work for reasons like the above.

    Could anyone tell me what a libertarian would argue besides, "It'll all work out"?

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