Friday, October 15, 2010

That Whole Thing about the Burning House, Yeah That: My Thoughts

So a lot of people seem to be debating that awful story of the house that burnt down in Tennessee while the fire department just sat and watched. But a lot of these debates aren't just about what that particular fire department should have done,but rather about what it says about our society and its commenters' world views. Many people have somehow taken the view that this argument is about free-markets and libertarianism and an indictment of those things. I truly do not understand this view at all. Here's why:

First, let's not forget that in many cases where there are complaints about a situation being a symptom of the free market (The BP Oil Spill comes to mind), there is no actual free market at work in the case. That is to say the market is either government monopolized (the fire example) or so heavily regulated by government to the degree of creating overwhelming and impactful incentives for behavior a free-market would likely discourage (BP). Here, this is a municipal (government!) fire department run by government employees/agents (bureaucrats) who were very clearly not motivated by profit, but rather adherence to a policy. Their lack of profit motivation was clear, ironically for the facts many free-market critics are eager to point out, which also brings me to my second point.

"When the blaze spread to the house next to Cranick's, the firefighters came to put that one out -- but refused to minister to Cranick's burning home, despite his begging and pleading and offers to pay anything they asked." Any profit-driven, greedy-ass company would have seen the Cranicks as a potential customer, a target audience (to put it mildly) and rendered them their service for a fee. In other words, free-market principles would have lead to a putting out of this fire. Its extremely easy to imagine a bevy of analogies to a consumer in desperate need of a service (let's imagine someone with a broken car late for his wedding day) and a nearby business who provides that exact service (the local gas station), and yet it's nearly impossible to imagine the business not offering that service when said consumer essentially puts cash on the table (sorry sir, we can't fix your car and charge you an extra 15% above our normal rates because brghfliksythna - that last part is the mechanic turning into an irrational beast and losing the ability to speak clearly). I mean, who would ever do that?

The main difference in these analogies, one might point out, is that a man with a broken car and the mechanic have no pay-in-advance scheme or market interaction that affects their transaction as did the Cranicks and the fire department. However, this is another factor in favor of free-market. Government services are often and typically pay-in-advance in the form of taxes, so the fire department here was ham-strung by the fact that they had little incentive or (and perhaps therefore) ability to accept "cash on delivery." It appears nearly all their money came in advance in the form of taxes from their home town and fees from the outlying neighbors. The man rushing to his wedding might have a pay-in-advance roadside service like AAA, and then he's good to go, but those of us who let our AAA membership lapse (I gotta get on that shit) know that we likely won't be required to walk 20 miles through the woods if we break down because nearby gas stations are businesses and will help you out if you give them money.

Some have Even bizarrely analogized the plight of the Cranicks to the Chilean miner miracle which I suppose is a funny pot-shot, but doesn't really make a very good point. What makes the fire story so interesting and controversial is that they house was allowed to burn down while the fire-fighters watched. This outcome is completely unimaginably impossible under a free-market fire-fighting system. We might be debating whether the fire department price-gouged the Cranicks, and acted immorally in doing so, but a good chunk of the house would still be standing, presumably. The Chilean miners would be pulled out by a for-profit mine rescue firm and they would just be sent a bill in the mail at a later date. (Or instead of a bill, for-profit firms might have other market incentives such as showcasing their technology or receiving positive and free press.) We see this all the time with our health care system - a perfect analog in that the moral questions are highly similar - people are either denied treatment for not paying the fee (buying the right insurance policy) or are billed outrageous amounts at a later date. Now, many people wish to have a debate proposing we change the whole health care system so everything is covered in advance, and that's fine, but very few people criticize doctors and hospitals when they deny services or send along a massive bill, because they understand its part of the (flawed) system. And literally no one gets all fired up and talks for weeks about some old lady who was denied hip-replacement surgery because of that system (though perhaps that's because the examples are too numerous to care).

So, again, I just don't see how this relates to free-market or libertarianism, let alone how it serves as an indictment of those concepts since they would have produced, at least in this particular case, the exact opposite, and desired outcome. Did the fire department behave immorally? Perhaps, but no more than a doctor who does not perform every needed surgery on every patient she sees. We understand and blame the system when it comes to those cases, we should do the same here. And really, if the system is so crappy, we should probably leave that to be addressed by the people in Booneyville, Tennessee.