Who is Less Free than 40 Years Ago?

Over at Reason [h/t Instapundit], Veronique de Rugy asks:

Many libertarians, eyeing the relentless expansion of the state, worry that freedom is marching backward. But are we really worse off than we were 40 years ago?

She surveys many aspects of freedom in modern life and concludes that on the whole we have gained more freedom than we have lost. Missing from this survey, however, is one critical area in which freedom has shrunk dramatically. 

Economic freedom, especially the freedom of economic creativity, has contracted.

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Obama, the Democrats, and the Economy–continued

(This is a continuation of my post on the election and the economy from several days ago. At that time, I focused on energy and trade; in this update, I also talk about small business, the demonization of entire industries, the micromanagement of innovation, the proposed elimination of the secret ballot in union elections, and corporate tax policy.)

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Why Executives Cost So Much

In my previous post, I explained why business spend a great deal of money on executive pay and why the rest of us should be glad they do. 

However, this raises the question: Why do we have to spend so much money to hire a small number of decisions makers? Even if the decisions they make determine the success or failure of entire businesses why does it cost millions to hire them? After all an executive doesn’t need the money to actually make decisions. In theory, an executive will make the same decision if you pay him $100,000 a year as he will make if you pay him $1,000,000.

So why do greedy capitalists pay millions to hire executives when in theory they could get the same decisions for less money?

The answer is deceptively  simple:You have to pay an executive more than he could make running his own private company.

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Navigators of the Economy

Life aboard ship in the age of sail was brutal, even by the standards of the day. Ordinary sailors worked in horrific conditions for months on end for little pay and often for nothing more than just a stake in the profits of the voyage. 

Easily, the cushiest  job on a ship was that of navigator. Navigators were quite often hired guns who had no other duties. A navigator often needed to work no more than four hours a day. He would come on deck two or three times a day to take sightings, then return to his cabin for an hour’s worth of calculations. Compared to the physically taxing, mindlessly repetitive and dangerous work of a sailor, navigators did nothing and risked nothing. 

Yet navigators often received as much as much as 25% share in the profits in a voyage. Even when they worked for pay, they received a wage many, many times that of sailors who did much more arduous and even critical work. Why did those who owned shares in a voyage, from the cabin boy to the landlubber investors tolerate paying the navigators so much?

The answer is obvious: if the navigator made a mistake, it didn’t matter how hard everyone else on the ship worked or how competently they did their jobs. The skill of the person doing the navigating determined the success of the voyage or even if anyone survived. People paid navigators a lot because if they didn’t, it didn’t really matter how much they paid anyone else.

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Foreign Export

(There have been a lot of posts here lately concerning some serious subjects, such as the pending US election or the Russian invasion of Georgia. I thought we could use some lighter fare.)

It must have been twenty years since I first heard about it. A wife would wonder if her husband was cheating on her, but hiring a detective agency to follow him around can cost a great deal of money. What happens if he is in between affairs? It could be years before he strays again.

So a few detective agencies here in the United States employed attractive young women who would carefully strike up a seemingly chance friendship with the suspected husband. The idea was to never actually suggest anything illicit, but to see if the subject of the investigation would pursue this particular honey pot. If he mentioned right off that he was married and wanted to talk about his family in a positive way, then the investigation would end. If he suggested a weekend getaway with his attractive new buddy, then that would also mean the end of the caper.

The idea here is to see if the husband was wise in the ways of philandery. If he knew what he was doing and moved in for the kill, then at least the wife would know that he was unhappy with the marriage enough to stray when opportunity came a’knockin’.

Is this still something that happens now, or was it a minor fad that ran its course decades ago? I have no idea, but I am having trouble finding any mention of this sort of thing online. Even if there are still detective agencies that offer this service, it must be a very narrow niche market that isn’t very well known.

Our fellow Chicago Boy Steven has written a post concerning a similar service that is available in Japan. They have certainly put their own cultural stamp on things. For one thing, the female lure seems to be willing to allow things to get physical in order to get the goods on the target. For another, the agencies also offer similar services, this time employing a male lure, for husbands that want to dig up some dirt on their wives. They even offer to conduct some rather elaborate operations to manipulate lost loves into giving a client a second chance.


Go ahead and read the newspaper article which discusses the practice
. Seems like an awful lot of money is being spent in Japan by people who need help in ordering their love lives.

I can see why this sort of thing isn’t very popular over here in the States. It rarely makes a difference during a divorce if one of the spouses is sleeping around, so there isn’t a financial reason to find out for sure. A divorce can also be sought by either party without the other granting consent, while in Japan it seems that infidelity is grounds for an annulment whether or not everyone agrees.

The sting operations described in the article are pretty elaborate, real James Bond kind of stuff. There really isn’t any financial motive to seek out services like that here in the US, but I can see why it would be worth the expense to someone who lives in a culture that will take such evidence into account when the family assets are carved up by the divorce judge. The article makes it clear that there are a variety of detective agencies that offer these services, and some of them are flush enough to maintain fleets of expensive cars to be used in the sting operations. That doesn’t happen unless a lot of people are willing to spend a lot of money for your services.

It also seems to me that the rigid social structure in Japan creates an almost unique environment for companies that offer these services. People make a big deal about how individuals will go to great lengths to try and avoid shame in that country, but they rarely mention that it also effects the bottom line. In Western societies, it is generally accepted that having trouble in your personal life usually doesn’t have anything to do with your performance or fitness in business. It seems to me that this doesn’t apply in Japan, where even the appearance of impropriety can damage your career prospects.

Stories like these, where people can be manipulated so easily if they are born into a shame based culture, makes me appreciate my own even more. Sure there are problems with a society that is individual-centric, but I think that it is still better than the alternative.

(Hat tip to The Volokh Conspiracy, who first brought the article to Steven’s attention.)