This article originally appeared in The Gold Standard, the journal of Gold Standard Institute.
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This article originally appeared in The Gold Standard, the journal of Gold Standard Institute.
Keith Weiner Economics 
I must admit that I’m a bit surprised to read this from you. I get the impression that you view the US federal government as some sort of necessity, that makes sure Intel sells chips to other states, and people don’t spontaneously start killing and robbing each other.Why on earth would Intel not sell chips to neighboring countries/states? It already sells chip to the whole world without some international governing body mandating this.If neighboring states refused to sell oil to each other, they would have to buy it on the world market, at around the same price that they would be able to buy it from the neighboring state/"country".I suspect there are other reasons, than the federal government, that make people choose to enter into voluntary trade with each other, and not go on violent crime sprees.Don’t get me wrong, I’m not saying a secession would solve anything. I don’t think it would make much of a difference to be honest. Some things would be better, other things worse. I just don’t understand your suggestion that the whole United States would necessarily plunge into chaos if it were split up into different countries.
Rune: If you mean that I think government, as such, is necessary then yes. I do think that. I am opposed to anarchism.Of course Intel would love to sell chips across borders. The issues are: what will 50 different governments do to block either product or sales?It may be that commuting across international borders becomes impractical, prohibitively expensive especially when it comes to taxes, too time consumer with multi-hour inspections at the border, or otherwise regulated.And look at the last collapse in 1929. Picture Smoot-Hawley times 50. Assuming you favor a "red" state, what do you suppose could be justified to do to "blue" states? What do you suppose those "blue" bastards would do to prove their ideology that a "red" state cannot succeed?My point is that breaking the big US into 50 little components will not make any of the problems go away, but will create many new ones. What about landlocked states? What if their neighbors get the smart idea that they can pay for their domestic welfare programs by taxing the goods imported and exported from neighboring states who have to traverse their territory?When the Founders wrote that clause about "regulating" interstate commerce, they meant to make it regular. They did not want the states to be able to levy tariffs on each other or otherwise restrict trade amongst themselves.
Do you think the people in these 50 separate countries would vote in politicians that impose huge import/export fees just to "get even" with the red/blue states? I tend to agree with you that people can be really vengeful, until they see the bill. I don’t think it’s improbable that ultimately the citizens would prefer lower costs of living, versus bothering the other states/countries.Wrt. to no problems disappearing by breaking up the US into 50 separate states, what about regulatory capture? There would be no "Washington" to go to for companies who want political favors. This has been the great advantage for me, living in a relatively small country (Denmark). No corporations bothered lobbying to get favorable regulation into such a small market. Until the EU was founded and lobbyists were given a central place to get legislation into all EU countries.If landlocked states get taxed heavily, I think there’s a good chance that people would move away from them. Plain and simple. I think there’s a reason we haven’t seen these types of extreme measures in the European countries, before the advent of the EU. At some point the citizens supposedly getting "free" welfare would realize that they’re not getting anything for free, they are paying with they ability to trade freely with a neighboring state, which probably has something they want.