A Good Point

Over at EconLog, Bryan Caplan makes an interesting obervation:

"Contrary to popular belief, Big Business often supports federal regulation. Economists' standard explanation: Regulation either directly restricts competition, or indirectly imposes a greater burden on smaller businesses. But there is another important reason why Big Business supports federal regulation that economists often overlook: To avoid the enormous transactions costs of dealing with 50 different sets of state regulation, and thousands of different sets of local regulation."

This poses a problem for my proposal for libertarians to support federalism. Because increased federalism would likely create a large set of differing regulations, this could impose greater costs on businesses than the more uniform federal regulation, however burdonsome the latter may be.

A plausible responce is that competition among states to attract business will result in more liberal regulation, as most companies can easily leave a state if the regulations are overly burdonsome.

No Libertarianism Without More Libertarians

I'm beginning to think that a more libertarian society will never be possible without more libertarians. This should be obvious, I suppose, but it's a point I don't encounter very often. The fact is that most people in this country believe the Federal Government should do all sorts of things beyond the enforcment of common law and national defense.

The first step for libertarians, I think, is to argue for federalism. This is where the aliance between libertarians and conservatives may have some purpose, though how many conservatives really believe in federalism is not clear anymore; the marriage amendment comes to mind.

I don't have much hope, however. I fear there are too many interests with a stake in the power of the Federal Government to allocate wealth and privledge, including the states. Alas, things may have to get much worse before they get better.