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Wednesday, April 16, 2008

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Hermes Ten

What amazes me is how this supposedly capitalist country so loves having a socialist military. Well, not really, it all boils down to how the meanings of "capitalism" and "socialism" have evolved in America. "Socialism" is how the people at the top allocate their costs --publicly-- and "capitalism" is how they allocate their profits --privately.

We have an idea of what the "market" wages are for serving in a place like Iraq --they're paid to people who work for "private" companies like Blackwater. Why is it that we don't get the people we need for our volunteer military like every market employer that wants more good employees: by offering more money? Wouldn't market wages and benefits solve all our recruiting problems? I think we should stop exploiting our soldiers and start paying them market wages.

Windypundit

How are we not paying market wages? The military makes an offer of employment, and the soldiers accept. That's a free market.

(If the military is consistently not living up to their end of the deal, as was apparently the case here, that's a different problem.)

Martin Owens

I cannot agree that this is a " free-market" transaction.

The market value for this kind of service is being paid by outfits like Blackwater. Very much larger than a soldier's pay, let me tell you! The US military trades on the patriotism and loyalty of its members- that is, the idea that they owe an obligation to the country which transcends market considerations; openly saying, "you won't get rich in this racket".

And that is one promise that they By-God keep!

Windypundit

What you describe is still a free market transaction. When you say "The US military trades on the patriotism and loyalty of its members," that's just another way of saying that the U.S. military is a much more prestigious outfit to work for. Blackwater has to pay more than the U.S. military because they aren't as respectable. They are probably weaker in other respects as well, such as combat medical support and long-term benefits.

This is not to say that military recruiting problems wouldn't be solved by higher pay, better benefits, or improved working conditions. Also, the military shouldn't squander the patriotism of its members by using them inappropriately, mistreating them, or failing to live up to promises made.

Hermes Ten

I never used the term "free market" and wasn't suggesting that the transaction wasn't at least partly voluntary --in fact, I referred to our "volunteer" military. In the industry I work in, "market" rate is essentially used in reference to the marginal or incremental rate, not the average or lowest possible rate that can be obtained in the market. It's a rate "at the market," just like in a stock transaction --when you sell "at the market," you're selling at the highest bid price at that moment. When we speak of a "market" price we're talking about what we have to pay for the next increment, not the cheapest increment; and this is not the rate being paid by the US military.

However, the notion that the US military pays a "free market rate" is ludicrous. In the first place, the exchange is entirely asymmetrical. In a "free market" I can quit working any time I want to. Furthermore, I can quit even if I'm under contract and quitting puts me in breach. I may owe monetary compensation as a result, but I cannot be put in prison for it.

In the second place, the military uses "stop-loss" to prevent people from exiting who under any stretch of the imagination would have fulfilled their contractual obligations in a free market. I personally know people who have been forced into active duty on the basis that the military can unilaterally reactivate your service obligations indefinitely and perpetually. To call such a system a "free market" is absurd.

Many libertarians seem to have fallen for the propaganda that the US is a "free market" country of some kind because some, or most, elements of a "free market" are visible in a specific market. Yes, there are some markets that approach a "free market," but if there is a true free market anywhere in this country, or any other country, I've never seen any evidence of it. Furthermore, I would contend that a "free market" is impossible under our current political structure, and that all the major corporations who benefit from the various protections of our largely mercantilist or crony capitalistic system, will vigorously resist any attempt to separate them from the State's teat.

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