A book about liberty, competition, and the common good.
This review is slightly different to others, in the sense that it’s over a month since I read the book, and I no longer have it with me. It’s a good test of how much really sticks.
For this read, only one key idea stuck – probably the idea the author wanted to make sticky!
The idea is: In markets where there is intense competition on a specific parameter, the market does not optimise effectively for the group OR for the individual.
Two examples, one animal, one human:
- A moose has huge antlers because moose with big antlers tend to win more moose-ladies. However, for the species, having huge antlers is a problem, since they can get stuck in the woods, are super heavy, and make the males more vulnerable to wolves because they can’t run away. Moose/meese/whatever are stuck in a cycle of stupid, where the species would be more effective as a whole if they had smaller antlers, but no individual with smaller antlers will pass on their genetic code, because they lose fights to those with bigger antlers. And so the cycle of stupid continues.
- In ice-hockey, it used to be optional whether to wear a helmet. Nobody wore a helmet. Instead, they took huge personal risks to gain extra visibility. No individual could start wearing a helmet without negatively impacting their relative performance on the team and in the league. Everyone wanted to wear helmets to prevent catastrophic injuries. In the end, it required the league to make helmets mandatory. Everybody wanted this. It artificially (via regulation) brought down the lowest common denominator, and made the sport safer for everyone, but also totally equal.
The author presents the idea in relation to policy. Many times, humans compete on a relative parameter against other humans. House size and location. Birthday party budgets. The expansion of house sizes, and insane birthday budget spends have long ceased to serve a purpose apart from relative competition. The author suggests a consumption tax, which sounds awesome to me, although difficult to implement.
Consumption taxes effectively reallocate money in an optimal way, and also work actively against overspending, since it provides a strong motive to lower the bar as a group. I think I’m missing key pieces of logic, but mayhaps this deserves a revisit if I move into policy work for any reason.
Good read, solid ideas, and it was a novel idea to me that markets had this innate flaw that infinite relative competition will not necessarily benefit the species.