How HOAs Help Show You Don't Need Consent in Government

I posted the following comment at Cafe Hayek (slightly edited):

Since the time I read Machinery of Freedom on Professor Boudreaux’s recommendation, I've thought two things: 1. It was be great to have a government/society that did not coerce anyone, but derived its authority from the consent of all its constituents, and 2. there is no way to do this.

Mr. Hinkle tries to use his HOA example to draw a distinction between a government of consent (HOA) and government, which rules without its constituent’s consent. The example is not persuasive, mostly because this case he uses as a jumping point is some kind of anomaly. Owners do not sign a contract to abide by the CC&Rs when they purchase into a HOA; They are bound to the terms of the CC&Rs regardless of whether they assent. You could argue that when a purchaser buys the property that they know is subject to CC&Rs they assent to them. But there is no ability to negotiate the terms of the contract; the purchaser must take or leave the CC&Rs, just as an immigrant must take-or-leave the laws of the country he immigrates to. And what if a person is born to a family living in an HOA and later inherits the property? The person is still subject to the regulations in the CC&Rs. That situation seem no different to me than being bound to the laws of the country you were born in without ever having consented to those laws.

You could say, if HOA's/CC&Rs aren't consent to, then we don't need them! We'll just let property owners opt in and opt out of private law system created and enforced by private companies (the Protection agencies from the Machinery of Freedom.) But HOAs solve property right problems, and their CC&Rs must "run with the land" to do so. If I want to buy property in a neighborhood where people mow their lawns and cannot paint their houses bright pink, these obligations must run with the land. While current owners may agree to those terms, I have no assurance that subsequent owners will likewise comply unless the contract, like CC&Rs, bind future owners, too.

I agree with Professor Kling that HOAs are better than government, because they are generally small, and easier to escape if they get too oppressive. However, on the question of consent, I see no principled distinction between an HOA and government. Both bind all who fall within their territory, regardless of consent.

I made another comment at the Kling link.

Game Theory in Democracy and Why Celebrity Apprentice is Fatally Flawed

1. I've been thinking about Danny's comment that "our pseudo democracy makes us think we have a voice and can make changes in government and the Chinese know they don't have one. Either way the people have the same pull." I don't think that's true. In an authoritarian regime, the majority can want something and not get it, unless they are willing to commit civil disobedience and revolt and possibly face physical punishment. Even then they might not get it what they want, and run a very big risk (e.g., Iran, which may or may not work out). That means most, even strong majorities are not going to get what they want, unless the government wants it too. In a democracy, the majority only has to want something so bad that they become single-issue voters on it, and they can usually get it. And the majority in a democracy doesn't risk serious retribution by government. Those are big differences. 
2. Unfortunately, while not strictly true, the statement certainly contains truthiness. That is Democracy gives you the feeling of control with very little actual control. Consider the following, which I think is kind of like game theory, but without the math (which I understand real game theory utilizes). We have persons A, B and C, who are students in a class trying to pick a class pet. They have three choices, a cat a dog and a fish. A prefers cat to dog, and dog to fish. B prefers dog to fish and fish to cat. C prefers fish to cat and cat to dog. If they all vote at once, they'll have one vote for each pet, and no decision. They'll have to vote in two rounds, between two pets, and the next round between the winner of the two, and the remaining pet. the outcome however, depends completely on the ordering. So, if the class picks between dog and cat, cat will win the first round (A and B for cat), and then in the second round between cat and fish, cat will win (A and C voting for cat). However, if the class picks between cat and fish first,  fish will win the first round ( B and C will vote for fish) and between dog and fish, dog will win the second round (A and B will vote for Dog).  In other words, voting only gives us the illusion that we are getting our preference. In reality it's random, or worse, can be manipulated.
3. If you want to get even more sad about it, you can listen to this excellent but depressing podcast by Russ Roberts and Don Boudreaux. First they point out that one vote basically never counts. Boudreaux doesn't even bother voting because he views it as a waste of time. Then they point out that, because you vote for candidates and not policy positions, you are taking the bad with the good, making the outcomes even more random and less representative of actual popular preferences. Picking a candid is like shopping, by choosing between several prepackaged shopping cart, where the voter just has to find the best fit for his preferences, and buy a few things you probably don't want or need. Then, what happens if only the policy positions you opposed but could live with are the ones that are enacted? I'm shooting from the hip here, but it seems possible to me that voters could pick one "cart" because of strong preferences about a few of the items that are in the cart, with none of the positions actually garnishing majority support. Like a cart that appeals to many various special interests.
4. I've long thought that people who don't want to vote shouldn't bother. If people don't care how they are governed, why not let the people who do care pick the leaders?  Now non-voters have another reason not to vote: one person can't make a difference.
5. I, by the way, have become an avid reader of Cafe Hayek, which is Boudreaux's and Roberts' blog. I almost get giddy about new blog posts. Today's post taking a journalist, to task for, well, acting like a journalist, would be funny if it weren't so sad and common. 
6. I want to say that I finished reading A Conflict of Visions. It was actually kind of a slog, and took me several months. First observation: Sowell is brilliant.
7. Second Observation: there is almost nothing about libertarianism in the book. I feel like libertarianism fits pretty well with a constrained vision, but Sowell describes it as a hybrid. I think it deserved more than the half-page treatment it got. (on to Frank Meyers?)
8. Third Observation and biggest lesson learned: liberals always seem to question conservatives' motives. I've always thought those accusations were in bad faith. Conservative and liberals generally want the same ends--help the poor, create wealth, increase freedom, etc.--we just have good-faith disagreements about how to reach those ends.  I can't find a good passage right now, but Sowell explains why liberals judge conservatives that way. Essentially, when you're liberal, and you think that people are "unconstrained", there is no reason to doubt that humans through government can correct social problems. The only think holding government back are the obstructionists. Anyone who does object to solving the problems is acting for some selfish motive and is evil. I need to find that passage because that's not quite right.
9. On to something a little lighter. Celebrity apprentice is fatally flawed. In normal apprentice you teams get a task, the project manager runs the task and people are held accountable for how they perform. Generally the project manager that loses gets fired. Now, some people on the show that become "celebrities" in the loosest sense of the word, like Omarosa, are going to hang around a bit longer. But everyone has about equal star power. Celebrity apprentice messes that balance up. Some celebrities have more star power, and ratings are everything for a show, so Donald's choice of who to fire is heavily affected by star power. Also, getting in a cat fight can only help your chances to succeed. Hence Joan Rivers and Annie Duke lasted to the end because they were in a huge cat fight (although I supposed normal apprentices can help themselves this way, too). Also, in celebrity apprentice, "succeeding" in the tasks is more related to who's in the celebrity's rolodex, and how well they can shake the money tree, instead of  how well they perform at the task. Fundraising, not performance is key. Either that, or every task is fundraising, so they should just call it celebrity fundraiser.
10. If you're a little nerdy, you'll probably find this funny.

Noodling Productivity

Don Boudreaux asks us to find the problem with this article. Here is his answer. I'll give you the summary. The article argues that increases in American productivity over the last several years are illusory. Productivity is measured by the amount of work or a unit of output. The article contends that work done overseas is not being considered, and is improperly hidden in productivity calculation. Someone is still doing the work, the article contends-- it's just not Americans. Thus American's really aren't that much more productive.

Don's answer is this:

If yesterday American workers required two hours to produce an electric drill, and today those same workers require only one hour to produce an identical drill, those workers’ productivity has risen.  Whether this higher productivity is the result of importing (rather than producing in the U.S.) more component parts of the drill, or instead the result, say, of a new machine that today produces some parts that yesterday were produced by hand, the result is the same: it requires fewer hours of work by Americans to produce a given amount of output.

I didn't understand this answer at first. I think I do now, and I agree with Boudreaux, but I think it's confusing. Here is why. The "hours" spent producing the drill don't just include the labor of the workers working in a factory on the actual drill. It also has to include the man hours spent creating and maintaining the "new machine." For example, if it takes one hours to make a drill with a machine, but a worker spends two hours to fix the machine for every drill, or if the machine takes so many man hours to create that the equivalent man hours can never be saved, then, the machine doesn't increase productivity. (Of course, no one will ever conscientiously use a machine that lowers productivity.)

Similarly, outsourced labor shouldn't be taken into account when considering American productivity. But those foreign laborers are providing the components for other goods or services. And those American hours spent producing the goods/service that are exchanged, should be considered, just like hours spent making/maintain the machine are considered.

At the end of the day whether it's a machine or trade, no one will voluntarily use either unless they increase productivity. I think Boudreaux doesn't go down this road, because he's trying to keep it short and simple. But I think he would agree that these other "hours" are incorporated into productivity calculations.

There's another similarity between trade and technology. Both "destroy" jobs. No one, however, argues we should get rid of copy machines, refrigerators or computers to bring back all the jobs they've eliminated.