Flutterby™! : Thought of the moment 2009-07-29 15:14:59.594222+00

Thought of the moment

2009-07-29 15:14:59.594222+00 by Dan Lyke 3 comments

Thought of the moment: Everyone pays some portion of a transaction in order to protect that transaction. Prostitutes pay it to pimps to protect themselves from cops and clients, we pay it to our legal system and our military. There's an overhead necessary to enforce the terms agreed upon.

Seems like for a resident of the U.S. that's probably about a quarter of the transaction, right? We pay a little less than half our income in taxes, half of the federal budget is the U.S. military, and then we pay for the judicial system and other paramilitary organizations, police and Sheriff and the like.

Does anyone have a closer number for this, and does anyone have comparative numbers? I remember the Freakonomics guys came up with some numbers on pimps and prostitutes, and that probably very much varies by economic stratus of the customer, I'm just interested in how people have looked at this number.

What part of the U.S. military budget is spent on defense, though, and what part is spent on aggression?

Regardless of that, I think pimps and prostitutes (and other illegal economic ecosystems) are more libertarian than any intra-national economy can be. The idea of cut-throat competition tends to be more literal and less of a cliché.

Linus, I think we have to consider the same question of pimps, and assign some number to the inefficiency of the market in such matters...