> Start with something along the lines of: 'the government may pass no law impeding free trade'
I might be misunderstanding you by thinking you just said that the government should never regulate trade; to dispel my confusion could you please explain how your idea of state/economy separation will handle coordination problems? How will it avoid tragedy of commons, or other race-to-the-bottom kinds of situations?
I'm not adventured, nor do I care to give my opinion on the issue, but two proposed solutions are:
1) Fixing the commons by eliminating them - grant property rights to the users which align their incentives with a longer-term health of the "thing" and allow markets to emerge.
In addition to the acknowledged limits, this also seems to gloss over what I see as the big problem with pollution controls based on property rights, which is many-to-many pollution. A massive coal power plant that poisons the surrounding air is easy enough to sue, but how do you handle something like the LA smog of old, with millions of individually-owned cars each contributing a tiny bit to the problem, but no one entity playing any major role?
I think he sort of touches on that when he talks about how the approach doesn't work on a global scale. It's fundamentally similar: when it's one coal plant, you can deal with it, but how do you sue a million coal plants all over the planet each one contributing a small part? But I think it falls apart even at the local level when pollution from individuals becomes significant, as easily happens now.
Privatize the roads and make the owners responsible for the pollution. Then they'll pass the costs to the drivers with a toll (which can be non-stop). Cleaner cars would probably get a discount, too.
Seems like you'd either have lots of road owners each owning small bits of road, which puts you back in the many-to-many problem, or a small number of owners each with a lot of roads, at which point they basically become local governments.
As I wrote in the other post, this is just one idea. Don't assume there aren't better proposals by people who actually thought about it for more than a few minutes :)
That said, the many-to-many transactions don't seem a problem to me considering that homes and roads are fairly static. AirBnB alone manages 375000 people sleeping on homes owned by another dozens or hundreds of thousands of people every single night.
This kind of transaction, on the other hand, would probably just happened once a decade, if that.
I understand there may be better ideas, but this is the one you wrote, and it's the one I'm replying to.
You're right that many-to-many transactions are workable in general. However, they're workable when both participants are willing. For pollution, only one participant is willing. The polluter doesn't want to pay damages, you have to force him. Many people can come together to force one entity to do something (class action lawsuits) and one large entity can exert its power to force many people to do something (government), but it's really hard for many people to force many other people to do something. When both the source of the pollution and the damage it causes is spread out, the cost of enforcement overwhelms the damages. Imagine a metro area with 100,000 road owners who are being held liable for pollution-related damages to five million local residents. How do the individual residents collect, when the individual road owners don't want to pay? Do they sue each one for 1/100,000th of 1/5,000,000th of the total damages in the area? Traditionally, this is solved by the local residents organizing and then exercising power through that organization, i.e. government.
As I said, this is just the first solution I could think of. Advocates of Free Market Environmentalism - which I'm not - may have much better solutions.
I'm not sure how well this would actually work, but someone (or group of people) would own the air/water quality. In order to pollute you would have to come to an agreement with them and pay the agreed upon value of the damage to their property.
The main trouble I see with that is that they'd have a monopoly, and that causes all sorts of trouble. When you get down to it, your proposal is basically what we have now, where that group of people that owns the air/water quality is the government. I don't think they technically own it, but given their ability to set standards, fine people for violations, etc. it ends up as more or less the same thing.
Just to be clear, this is not my proposal. I like the concept of markets determining the cost of various things. I would prefer that the government auction off pollution rights each year, that way the government holds thew monopoly and determines the cap, but we still have reasonable pricing. No matter how little you polluted you would still have an incentive to pollute less.
What we have now is free pollution up to an arbitrary point where it becomes very expensive (because it is illegal). The obvious dominant strategy in the current system is to not care about pollution unless you are near the legal limit.
Air pollution on a large scale (i.e. anthropogenic climate change) is a particularly difficult problem, whether you've got a laissez-faire free market, a global society like today, a world government, or any other system I can imagine.
I might be misunderstanding you by thinking you just said that the government should never regulate trade; to dispel my confusion could you please explain how your idea of state/economy separation will handle coordination problems? How will it avoid tragedy of commons, or other race-to-the-bottom kinds of situations?