Conversations with Libertarians - Part 1

I must say that Facebook discussions have done at least one thing for me, and that is to introduce me to some people with some strange...er... divergent... points of view.  Over the past few weeks, I've exchanged arguments with climate change science deniers, anti-vaccine alarmists and general conspiracy theorists and, most recently, Libertarians.  In a perverse sort of way, it's been kind of fun arguing with them.  Very similar to arguing with a wall.  Or a pet dog.  You're never sure if your words connected in any real sense.

Libertarians have what could be quite an understandable point of view.  They see a limited role for government in society.  The smaller the government, the better, so far as they're concerned.  But what happens, because of their intense dislike of government (still, understandable, as most of us would agree), is that every time there is even a hint of government involvement, even a slight suggestion, even if it's one they made up, there's lots of arm waving, finger pointing and shouting "GOVERNMENT MEDDLING" and "INTERFERENCE IN THE FREE MARKET" and such like.  It's all rather exciting, and amusing.

My most recent exchange began innocently enough.  The person I was exchanging views with is an acknowledged anarchist.  I think he actually believes it, at least sort of.  He also sits firmly in the science denialist camp and seems to be a Libertarian as well.  I'm almost certain that some government civil servant must have short-sheeted his bed once.  What else could generate such antipathy?  I digress....

We were exchanging polite comments about financial institutions that are/were "too big to fail".  We had even agreed that letting bad firms fail would be a good thing.  Weed the bad ones out.  Punish them for poor business decisions.  We were all smiles and fuzzy feelings in our unanimity.  It doesn't happen often between us.  I commented that this was a great idea as long as they didn't take everyone else with them and then made some reference to what about account holders, lost bank accounts and such.  And would we still have CDIC (Canada Deposit Insurance Corporation) to insure bank accounts or would that be government intervention in the so-called free market.

The response was: "Those things would be returned to the market where if they didn't supply benefit to their customers they would fail and get out of the way for someone else. Banking deposit insurance is a cost that should be paid by the depositer not all taxpayers. It's hilarious because that is a direct tax grab for corporate banks. The exact thing leftists think they are against."

I have to admit I was nearly speechless...er...typeless... but only for a moment.  Surely not the CDIC?  A leftist tax grab?  Ever grateful for my (slow, free market) Internet connection, a minute or so returned me an answer.  

The facts are these:  The CDIC is a Crown Corporation.  It's entire operation is funded by "premiums" paid by member institutions (ie: banks).  I even looked at their last Income statement.  No doubt about it.  It's basically a Crown Corporation masquerading as an insurance company.  I hastened to enlighten my fellow debater.

My correspondee replied: "It doesn't matter if the taxpayer pays the premium. It is a fee. The tax payer pays for government itself.

Now I was getting concerned, partly because I wasn't even sure what his point was.  In my mind, it matters who pays.  And I do understand what it is taxpayers do....  So let's use an analogy.  The government insists that all vehicles be insured by their owners.  So we grumble and wander off to purchase an insurance policy.  In most provinces, we pay our premiums to some private insurance company.  We get into an accident.  It's judged to be mostly our fault.  Rather than having to pay out of our own pockets, our insurance company pays.  The CDIC works in much the same way, except they don't bail out the bank, they make sure the bank's customers don't lose everything, at least within certain limits.  According to this guy,though,  that's "government meddling", presumably because the government made us take out insurance, I guess.    See the logic of that one?  Yeah.  Me too.