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tv   Antony Davies Cooperation Coercion  CSPAN  October 11, 2021 6:37pm-7:01pm EDT

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what a nice wrap-up that was and what a terrific talk it was. for the folks at home, i posted in the chat one more time a link to the book. if you want to buy it, you can go to fox bookshop, or wherever fine books are sold. that will do it for us. david, thank you so much for joining us. >> thank you. >> thank you, david. i enjoyed our conversation so much. >> c span is your unfiltered view of government. we're funded by these television companies and more, including comcast. >> you think this is just a community center? no, it's way more than that. >> comcast is partnering with 1,000 community centers to create wi-fi lift zones so students can get the tools they need to be ready for anything. >> comcast supports c-span, along with these other television providers, giving you
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a front-row seat to democracy. >> book tv continues now. television for serious readers. >> and now joining us on book tv is antony davies, the coauthor of "cooperation and coercion". professor, davies, in your book you write that early on children learn a word for people who tell others how to live their lives busybodies. why is that important to the theme of your book? >> the sub title to the book is how busybodies became busy bullies and what that means for economics and politics. and busybody, we all know from children up to our auns that stick their noses in our business at thanksgiving, but when you pair busybodies with government coercion, they transform into busy bullies, people who decide how it is that
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you should live your life and they're going to use the force of government to see to it that you live your life the way they think you should. and ultimately the idea of busy bully, kind of ironicry, is a repudiation of diversity. we're all different, we have different preferences, different abilities, different constraints, and what might be a good and right decision for you may not be a good and right decision for me. and when a busy bully comes along, the busy bully has in the back of his or her head figured out that everybody is just like that person is, and whatever works for this person must work for everybody else. it's such a good idea, let's employ the government to force everybody to act this way. >> when did you come up with the term busy bully? >> we came up with the term busy bully, my coauthor, james
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harrigan, and i, in writing op eds about these topics. what happened in philadelphia, this was perhaps a year and a half to two years ago, the city council there decided that teenagers were drinking too much sugary drinks, so they're going to impose a 30% tax on sugary drinks. why? because the city council, the busy bullies, decided that other people should live the way that they believe they should live. and what happened, interestingly, is sales of sugary drinks dropped tremendously following this tax. and people who were proponents of the tax pointed to it and said, look, this is exactly what we had in mind. you put a tax on things like coke and pepsi and mountain dew and this sort of thing, and what happens, people will buy less of it, to which economists replied, hang on a second. i thought your concern was how much sugary drinks people were drinking, to which the proponents said, look, if sales of sugary drinks have declined,
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clearly people are drinking less. some economists went and did studies. what they found was that consumption of sugary drinks in philadelphia did not decline after the tax. and that raises a question, how can that be if the sales of sugary drinks are declining, but consumption isn't? what was going on is people faced with this 30% tax on sugary drinks were driving outside of philadelphia city limits to buy their sugary drinks. and while they're driving outside of philadelphia to buy their sugary drinks, what else are they going to do? they're going to buy their groceries. and all of a sudden there was a tremendous decline in grocery sales within the city of philadelphia. this is an unintended consequence of busy bullying. and you see this time and again when people who, for good and noble reasons think that they should tell other people how to live their lives, more often than not what you get is an unintended consequence or a sequence of unintended consequences where the outcome
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that you end up with is not at all what you had in mind when you passed the legislation in the first place. >> is that tax still on drinks in philadelphia? >> to my knowledge, it is. and, you know, as with taxes, taxes are somewhat easy to come by, but they're really difficult to get rid of. i give you a case in point. we talk about this in our book, the johnstown city tax, johnstown, pennsylvania, back in the '50s it was decimated by a flood and so pennsylvania said, okay, we're going to put a tax on alcohol and the proceeds from this tax will rebuild johnstown after the flood. and, of course, the tax generated lots of money and rebuilt johnstown, but once johnstown was rebuilt, the tax didn't go away. we still have the tax today. in fact, to date, pennsylvania has collected enough revenue from that tax to rebuild johnstown six times over, and the tax will not go away because once government gets a tax, it likes to hang onto it.
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>> professor davies, you write in your book, the essence of government is force. >> yeah, the essence of government is force. when we wrote this book, what motivated it was we looked back through history and what we notice is any time humans come together to do anything, they organize themselves either according to principles of cooperation or principles of coercion. and principles of cooperation means you come together voluntarily and you do something, if things work out that's great, if they don't you're free to walk away. everything that's going on is cooperative. it's voluntary. then we also organize ourselves from time to time according to principles of coercion. that is we have somebody who says, okay, this is what's going to happen and you're going to do this and we have force behind this edict that we're imposing on you. typically when you think about coercion, you think about government, that is the major tool we use for coercion.
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when you think about cooperation, people go to markets and markets are a good example of cooperation, but all sorts of other things as well that you might not think of. things like your parish church community is a cooperative venture, social clubs are a cooperative venture, your friday night poker game is a cooperative venture, families in a large part are cooperative ventures. so cooperation is this form of organization by which we come together voluntarily and agree to do things. now, as we started this book, our intent was to say, look, cooperation is good, coercion is bad and that's the story. and the book proceeded along those lines until we got to the last chapter. the last chapter just wasn't fitting. things didn't fit together. and we realized, this is not a story of cooperation, good coercion, bad. rather, it's a story of faced with all sorts of problems, we have these two tools in front of
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us, cooperation and coercion, some problems -- in fact, most problems, cooperation is the appropriate tool. but there are some problems, they tend to be limited, but there are some problems for which coercion is the appropriate tool. once we came to that realization that these are two tools and the trick is to apply the right tool to the right problem, the book all came together into some nice uniform flow. but you're absolutely correct, where we end up with is government is the tool we use for coercion and people will come back and say, well, government is not coercion, government is what we do together. that's incorrect. cooperation is what we do together. coercion, the government, is what i do to you and you do to me. and anyone who has any doubt about that, just ask yourself, what would happen if you stopped doing what the government told you? take a simple case like a parking ticket. i get a parking ticket.
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what if i don't pay it? well, i get another one. what if i don't pay that? i get a summons. what if i ignore that? the gentleman with handcuffs and guns show up to drag me before the judge. what happens if i resist them? now we have force. and ultimately at the end of every edict the government makes, is this threat of violence. and that threat of violence is appropriate in certain very limited circumstances. the problem that we have come to in this country is that we have come to use coercion almost as the default mechanism. when we see a problem, we turn to the government and say fix this. government isn't designed to fix many of the problems we throw at it. yet politicians are happy to try because in trying they get elected and they get more tax revenue. all the things that the politicians want. so in a lot of ways, politicians use government and its coercive force as a way to get elected. >> professor davies, what about
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community standards? i'm thinking about issues such as pornography, prostitution, tobacco use, marijuana use, alcohol. should community standards be lad to rise to the top? >> yeah, this is a good question. and it raises a secondary question, which is what is a community standard? i mean, you have your idea of what community standards are, i have my idea, and i'm sure our two ideas of community standards overlap tremendously. but i'm also sure around the edges there are places where we'll disagree and there will be other people who disagree markedly with the two of us. so we end up where the founders intended us to be when they designed the federal government, and that is a place in which the federal government's role is not to establish community standards, rather it is to prevent you from harming me and prevent me from harming you. not just in terms of physical
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harm, but also in terms of fraud, of deception, environmental pollution. if i dump my trash in your yard, this is a harm to you. an appropriate use of coercion of government is in preventing that harm. but beyond that, you leave it to cooperation. and what you'll find is that community standards you're talking about will emerge because you'll have -- you'll live in a community and the people around you are like-minded and you say this is the way we want to grow our community, these are things we want to do. and i'll look at that and say that's nice, i want to live there. i want to be part of that. so i come and i move and i join. and if at any point i think, no, this is going the wrong direction, i don't want to be part of this, i'm free to walk away. that's cooperation. that kind of free joining and leaving when we agree and disagree doesn't happen with coercion. and so consequently, if you get the right people in government who have the right idea about community standards, you must
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have a decent society. however, the odds of that happening are very low. what's more likely is that you'll get people in power whose ideas of community standards deviate significantly from yours and now they've got the power to use force to enforce what they perceive to be community standards. >> what do you do at duquesne university? >> i'm a professor of economics, so i teach economics. my specialty is statistical analysis, but i spend a lot of time writing op eds, we have a podcast, words and numbers, which i encourage you all to listen to, and we talk about the application of economic thought to current events. so, for example, in the book we have a chapter on the knowledge problem. the knowledge problem says, simply, look, a single person can't contain in his or her head all of the information necessary
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to make decisions for others that are better than others could make for themselves. so when we allow the government to take on too large of a role in making decisions for us, we end up with bad outcomes. i give you a good case in point is our war on poverty. the poverty rate in this country was falling dramatically up until we instituted the war on poverty. once we instituted the war on poverty, this decline in the poverty rate in the united states flatlined. and it stayed at about 13% ever since the war on poverty began. and we have devoted trillions, literally trillions of dollars to this war on poverty. in fact, we have devoted so much money to the war on poverty that we could have eradicated poverty if we hadn't used the government to do it. if we had simply said we're going to collect taxes to eradicate poverty and we're not going to build poverty programs.
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currently we have over 100 different programs at the federal level alone to help deal with poverty. instead of establishing those programs, each of which takes on a life of its own and starts to have people involved in it who have their own incentives in keeping the program going, if instead of doing that we had simply cut checks, every poor household gets a check every year for $10,000. not even every poor household, every poor person, a check every year for $10,000. we could have been doing that for the past 50 years, eradicating poverty, for a lesser price tag than what our war on poverty costs. and our war on poverty has left us with a 13% pretty constant, plus or minus, poverty rate. and so as i talk about economics, one of the things that i emphasize with my students is that economics is not about making profit. economics is about thinking about how humans behave.
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once you understand how humans behave, that applies, of course, to the business world, but it applies to politicians and voters, too, and you can better understand how government and society interact. >> tell us about your coauthor, james harrigan. >> he's a political scientist, so between the two of us, we have all the bases covered between economics and political science. and much of the politics that you'll see in the book come from james. >> and he's at the university of arizona, is that correct? >> he is at the university of arizona. he's a professor of political science there. and he and i have written together in probably 200, 300 op-eds published throughout the country over the past decade. we have our podcast words and numbers and probably several hundred videos on economics, public policy and government, and all of this in an effort to educate the public, at whatever
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age you happen to be, from grade school up to retirement. the key to building a more healthy society, to moving -- taking all of the wonderful things the united states has done and progressing forward into next generation, the key to it, and it sounds trite but it's true, the key to it is an educated populus. by educated populus, i don't mean people who can read prost and quote shake spear. i mean people who understand how the shared system we live in works, because if they don't, they become fodder for politicians and a politician can come along and say elect me, and i will give you free college, and everybody cheers and says, yes, i want free college and i elect this guy. and actually, you find out after it's too late that there is no such thing as free college. you've just made your own life worse off because you didn't understand the system in which we were working, the incentives the politician had to offer
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something he couldn't deliver, and what subsequently happens to the economy when he attempts to do so. >> professor davies, you have a case study in here on the minimum wage, and the number 550,000 appears. what is that? >> yeah, we have an entire chapter on the minimum wage, and economists have written a tremendous amount on the minimum wage. people will say to me, if the minimum wage is such a bad idea, how come economists don't write about it? there's quite literally hundreds of peer reviewed studies on the minimum wage and of these hundreds of studies, i would say 98% of them find the minimum wage actually is harmful to the people that it attempts to help. there's maybe 1.5% that says it's unclear what's going on with minimum wage and maybe half a percent that say it's beneficial. of course, what happens is the politicians and media focus on
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that one-half of a percent. largely speaking what happens with minimum wage is you have the government coming in and staying to workers, if you cannot find someone willing to pay you $15 an hour, you may not work. now, thought of that way, it seems horrible, because the way it's presented is we're going to have minimum wage and force the employers to pay you more. what comes across is this image of the minimum wage is about a conflict between workers on the one hand and employers on the other and the government is going to come down on the side of the worker and force the employer to pay more. in practice that's not what happens. the minimum wage is not about workers versus employers. it's about high skilled workers versus low skilled workers. so if the government comes along and says, okay, all you businesses, you've got to pay your workers $15 an hour, the first thing that an employer does is looks around at his current workers and he asks, who
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here is worth $15 an hour. those who are worth $15 an hour keep their jobs. those who aren't lose them. and if you want to think about an example of this, we all do this every single day. think to yourself, how many people do you hire to clean your house, to make your bed, to do your dishes? and people will say, well, nobody, i do that stuff myself. why? well, because to hire somebody to do that is going to be more costly than what it's worth to you. so imagine hiring somebody to come in every day and make your bed and clean your room. what's that worth to you? you say, well, it's worth maybe a buck an hour or maybe two bucks an hour. i would just rather do it myself. but nobody is willing to do that at $1 or $2 an hour. notice what just happened. you put a value on that completed work that was low and you concluded that it's not worth hiring somebody to do this work.
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this is exactly what the employer does. and when the minimum wage comes along, what the government is saying is, you've got to pay $15 an hour and the employer says, what is the work that i'm hirering people for worth? if it's not worth $15 an hour, you lose your job. so you can look at the data and what you find is that as we raise the minimum wage, who gets -- not in every case, but on average, who gets hurt are the low skilled, low educated, low experienced workers. the very workers we're most concerned about helping. >> and what surprised me in your analysis was you say that only about 550,000 americans actually get the minimum wage. >> yeah, that's correct. there are a couple of misconceptions here. when i asked people, how many americans earn the minimum wage, i'll get numbers like 30%, 40%, because people are repeating things they hear in the news. the actual number of americans
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who earn the minimum wage is around 1%. 1% of the workforce. it's a very small number. in fact, what you find if you track these workers over time, take a bunch of minimum wage workers today, within one year 60% of them have moved on to earn a higher wage. within five years, virtually all of them have moved on to earn a higher wage. these minimum wage jobs are entry-level positions. they're places principally, not exclusively, but principally for people who have no job experience, someone that you're asking an employer to take a chance on. at five bucks an hour an employer would easily take a chance on a worker. at $15, not so much. as we raise the minimum wage, we make it harder and harder for employers to take chances on new workers and that delays those new workers from entering the workforce. and when we're done, as you say, we end up with trying to solve a problem that's afflicting only about 1% of the workers.
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now, again, i'm not saying that we should ignore these workers. what i am saying is that the problem is much, much smaller than what is perceived in the media. and why is that so? because politicians want to get elected, and how do they get elected? they get on the news and say we have a problem and they show you people who are suffering from this problem, and they say, elect me, and i'll fix this. quite literally politicians are machines that turn problems into votes for themselves. >> almost no part of our lives is free from regulation by some level of government, if not multiple levels. government has its hands in everything. that's from "cooperation and coercion", how busybodies became busy bullies and what that means for economics and politics. our guest, antony davies and james harrigan. thanks for being on book tv. >> my pleasure, thank you. >> c-span has your unfiltered
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