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System-D

Date line Barcelona, Spain – July 2013

The beach near Port Olympic.

System D, The black market, underground businesses, the shadow economy,  – it all works – it has always worked, and designs itself without plans to work without plans. It is an organic process that does not stop for meetings.  It is not something engineered by a committee, or a department or a bureaucracy, but it is pure Smithian and Hayekian economics at work.

In this case it was supply finding demand.

Several young Indian men, recent immigrants to Spain and out of work.  Had small vending operation.  They were selling mojitos and other simple rum drinks on the beach.  They were well dressed selling for €4 – this drinks in clear solo cups.   Those glasses are all over the globe.  I figured something was amiss when they ducked into the rocks over by Port Olympic.

Being a pink boy and having been based in Number 30 sun block and spent my 20 min on each side roasting – I was done.  So I went to see what was up.  I walk right over to the rocks where one fellow was hiding and sat down – not looking at him hiding in the rock but out into the ocean.  I asked the simple question…

Sir, está prohibido vender esta bebida?

Excelente, voy a tomar dos bebidas fuertes.

Gracias, señor – ¿de dónde eres, en los Estados Unidos?

Phoenix, Arizona

Ah – my younger brother is at Arizona State University.

Go Sun Devils

Yeah – go Sun Devils, but I prefer to watch basketball – I love the Phoenix Suns, they should have never traded Steve Nash.

So your English is perfect, you know a good deal about the United States, what are you doing selling drinks at the beach?

My job was cut as an engineer – so after complaining – my two brothers and me work the beach.  We can net € 200 in a day free of taxes – that’s the same as € 620 per day as an engineer.

Is that more than you made as an engineer?

Yes – it is – but it is seasonal.  I would prefer to be an engineer in the winter and sell drinks in the summer.  Everyone likes our drinks and everyone at the beach is happy.

I wish you the best of luck at all ventures.

Thank you sir.

The informal market place is treasure of knowledge for us desk sitters.  It is where real labor meets real markets.  It eliminates free riders and culls bad ideas quickly.  Here the individuals experiment as to what works daily.  If it is a success – it is adopted – if it is bad, it is eliminated.  There are no committees doing studies or professional opinions givers defending territories.  It is real work, real experimentation, with immediate feedback and adaptation to the market each and every day.

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