Who Were the Sea Peoples?

I just read an intelligent economist (not an oxymoron, I swear!) claiming that market exchange "guarantees" that in an unfettered free market, goods go to the people with the highest valued use for them. Sigh. What about the ability to pay? Let's say we establish a market in human organs, as many libertarians advocate. And further imagine this market is unregulated, something of which they would no doubt approve. In such a market, there will be many poor people who need kidneys. But imagine that George Soros likes to have a dozen grilled human kidneys for breakfast every day. Poor people in need of a transplant might very well value those kidneys much more highly than Soros (i.e., if we gave them each a billion dollars, they would easily outbid him for them on a free market) -- but they simply lack the funds to compete with his voracious kidney appetite. It is reasonable to contend that the price we pay for the benefits of free markets is that sometimes rich peo...

"For very many years I've not believed in welfare economics as a scientific construction. My idea of welfare economics is that you choose an administrator, a man with a conscience himself, and broad sympathy, with a generous mind and then you say, quote 'Leave it to him!' I don't believe you can do any better… "Those economist who are going to give advice, or who are going to be advisors either to government or to business, should have their training based in economic history, and they only need as much theory as you find up to the second-year textbook." (Quoted in Earl and Littleboy, p. 21)

Murray Rothbard, in his most famous paper , argued, essentially, that because human beings acting in a free market optimize, there is no possibility of an intervention from "outside" improving the outcome of that optimizing for everyone. Here is Schelling: "How well each does for himself in adapting to his social environment is not the same thing as how satisfactory a social environment they collectively create for themselves." -- Micromotives and Macrobehavior , p. 19 On a bad road, every driver will optimize his driving, given his preferences. But if the road provider offers a better road, the overall driving environment will improve. This does not prove that governments are capable of providing such improved environments. But it does illustrate a second flaw in Rothbard's argument. (I will not rehearse the first one here: it is well known, and easy to spot.)