Libertarianism and social phobias

I have long wanted to talk about how the libertarian approach “allow everything and everyone” and the notorious “private discrimination” actually works. The implication is that in a libertarian society it will be possible to open “whites only” cafes and refuse to bake cakes for gay weddings. Say, if you want to discriminate against gays, migrants, drug users, anyone - please. Therefore, libertarianism is sometimes seen as the last refuge of racists and homophobes (and often racists and homophobes themselves).

Indeed, the libertarian approach assumes a fairly wide autonomy for business: it is possible not to hire or serve a certain category of people. But here’s the thing: libertarians claim that this is the way to OVERCOME prejudice. This is a bit counter-intuitive, but I’ll explain everything in a moment. Libertarianism here is based on simple economic logic. Trade and cooperation is profitable and profitable, win-win strategy. While isolationism and enclosure tend to be costly, they are such zero-sum games.

Imagine a situation in which there is a xenophobic farmer - everyone around uses the cheap labor of migrants, and he basically hires only locals at exorbitant prices. As a result, its products cost three times more. One such farmer can still survive at the expense of some narrow loyal audience (buy eco-products of the 14 words farm - our milk is whiter than your skin!) its narrow niche and will not become very common.

But now let’s imagine that the same farmer put together a lobbying group and they lobbied for the closure of the borders. Now everyone hires locals at exorbitant prices and produces expensive products. What happened? If earlier the xenophobic farmer himself paid extra for his prejudices, now the “costs for xenophobia” have been spread in a thin layer throughout society. At the same time, they seem to be invisible. If everyone overpays equally, then as if no one. At the same time, the costs per person are reduced: if one paid 100 rubles for prejudice, now everyone pays 1 rub. So the option to “be a xenophobe” becomes hundreds of times cheaper - and this way it becomes more attractive.

Thus, universal government measures—whether it be tariffs on foreign goods, bans on migrants, or discrimination against a particular group within a country—is the kind of thing that makes it possible to “nationalize the costs of prejudice” so that policies based on them can last for decades. The libertarian approach is the opposite - it is to “privatize prejudice.” Yes, in a libertarian society, everyone will be able to fence themselves as much as they like, but everyone will also pay for their decisions themselves. Communities and businesses that are more inclusive and open will thrive, while those that are closed and fenced off will thrive.

Moreover, it seems to be the only effective way to fight prejudice. Irrational fears, moral panics, etc. - these are all distortions built into our psyche, and we are pleased to feed them. So, relying here purely on any “enlightenment” is rather naive. But, thank God, we can pit our irrationality with our own greed. And, when people see that delusions cost a pretty penny, in the choice between prejudice and well-being, the latter wins.

Mihail Pojarsky 2021-03-18