Refutation of Mises.org!
Here is a blogger who promises to refute all articles on Mises.org! This should be good.
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Here is a blogger who promises to refute all articles on Mises.org! This should be good.
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Comments (141)
Lucas M. Engelhardt
Oh, it's not even fair posting this kind of temptation, Jeff. Not even fair.
I have to sleep some time - and finish a dissertation - you know. ;-)
Published: December 9, 2008 10:28 PM
Nick. B
This guy admits he's no economic or marxist sholar, yet he's calling our theorist hollow!? What a moron!
Published: December 9, 2008 10:40 PM
Brent
"The answer is of course need."
So he concedes the argument to Hoppe, then he whines that the laborer should get paid more because of "need". Brilliant argument. I'm shocked that it turns out he isn't an economic scholar!
Published: December 9, 2008 10:49 PM
C. Evans
I took a look at some of the blogger's posts and I keep thinking of Chodorov's theory of socialists being born and not made. Private property and individual liberty just aren't goals of this writer. In a post about communism and violence the wriiter argues that majority-rules tyranny is fine. The writer believes that when a majority of workers decides to take over the means of production, there is no violence on their part. They peacefully walk into the plant and take it over. It is the owner of the plant who tries to defend his property that is the aggressor. Natural rights of the individual do not exist; only the general will matters.
Perhaps I'm too pessimistic, but I believe that people who wish to run the lives of others will never cease in this desire and never be converted to freedom. To enslave others is in their DNA. But if we could abolish the State, at least their attempts to enslave us would require their own resources.
Published: December 9, 2008 10:50 PM
Brad
He commits so many straw man fallacies that I don't even know where to start. Before you try to debunk something, you at least have to understand it. He also has a laughable article on his site trying to debunk Rothbard's "Egalitarianism as a Revolt against Nature" and repeatedly tries to claim that communism and anarchism are compatible (a claim which even Marx recognized to be absurd).
Published: December 9, 2008 11:17 PM
Inquisitor
Yawn. Another crank. Let him "refute" to his heart's content. Just more nonsense to ignore for me.
Published: December 9, 2008 11:18 PM
Nasikabatrachus
In claiming that Hans Herman-Hoppe falls foul of an assumption, this person falls foul of an assumption:
"Now this immediately falls afoul of an assumption: That the worker does indeed value present goods more than future goods. This however is begging the question: “Why is the worker valuing present goods more?”. The answer is of course need. The only reason a person would prefer to have less money now rather than more later (and that “later” can be as short as 1 hour from now) is because they have an urgent need that they cannot ignore until later. That urgent need can only ever be food or shelter." (emphasis added)
In the first rebutting paragraph we have a straw-man (Does Hoppe really mean "to be received in less than an hour" when talking about a worker's compensation? I doubt it), and a quite unwarranted assumption (a high time preference for money means the money is for urgent need and the only urgent needs are food and shelter--as though temperament and ambition are not factors at all). It doesn't look good already, and the rest of it isn't. They generalize from a hypothetical situation in which going into debt is the only way to survive to say that all workers everywhere are being passively coerced because, after all, the only reason someone wouldn't open their own business and employ themselves is because they're already starving (and as we all know competition between businesses never raises wages at all).
Like most marxoids dedicated to proving that capitalism is evil because if the worker didn't work for a wage the worker would starve, the role of the people who actually sell food is mysteriously overlooked. Factory owners, after all, don't grow and sell food; farmers and other businesses related to agriculture do. (You can't eat widgets unless you try really hard, and it's not that satisfying, believe me.) Why is their role in the "exploitation" of the worker completely ignored? Why does the mere intermediary dispenser of currency take all the blame when it is the vile exploitive farmers who demand the dough in the first place? It's a curious world this person posits, where only workers and capitalists exist in monopsonistic stasis and people can only eat money.
Published: December 9, 2008 11:18 PM
greedy capitalist
Hoppe correctly pointed out the difference in time preference between the capitalist and the wage earner. This other blogger seems to think that the system is rigged against the wage earner, but it isn't. If Andrew Carnegie, a child of an immigrant family, could work for a few dollars a week when he was just 12 years old, save up his money, invest in emerging industries, and become a multi-millionaire--by golly, so can I!
Published: December 10, 2008 12:02 AM
JB
From the blog:
"And this is simply untrue. First of all, the capitalist does not give the worker present goods. How many times have you been paid on your first day of work for what you’re going to do in the coming month? Never of course."
What a total fallacy. MANY jobs pay workers upfront sums of money to cover moving, living, etc etc... The only reason that a worker wouldn't get an upfront payment is if the employer thought that there were other workers that could do the job to an equal degree.
In essence, the market, for that specific job, has set the upfront payment to zero; stemming from the workers desperation (demand) to "exchange future goods against present ones...at a discount."
Published: December 10, 2008 12:12 AM
Inquisitor
That is incorrect anyway. The money need not be paid on the first day of one's work - it only need be paid in advance of the completion of the product in question. That is the advance Hoppe is speaking of. So in comparison to the fruits of enterprise, wages are more immediate and an advance on the future product. In short, this moron does not know what he is talking about.
Published: December 10, 2008 12:47 AM
Eric Hood
If you look at the posting guidelines they are particularly hostile.
I liked one part that said if you try to tell me I should read something so that I can discuss it intelligently I shall ignore such posts.
The site also seems to have been designed to make reading a chore, irritating like chalk on a blackboard.
Published: December 10, 2008 1:24 AM
Inquisitor
If someone wilfully remains ignorant, they're not going to be able to produce effective criticisms of a doctrine, now are they? Hey, it's his own funeral. If he wants to remain clueless about Austrian econ and attack strawmen of his own fabrication, let him! Who gives a damn if some commie loser wastes his time jostling with chimaeras he made up?
Published: December 10, 2008 1:35 AM
IMHO
"Indeed, when people have enough money to survive, very often they invest their money as well or start their own business. The problem however is that not everyone has this luxury. The vast majority of humans can never leave the working class and move to the capitalist or petty-bourgeois because they start at the condition where their basic needs are not fulfilled and because they do not own any means of production."
If money was all that was needed to start and run a profitable business, then why do so many people who win the lottery end up broke?
http://articles.moneycentral.msn.com/SavingandDebt/SaveMoney/8lotteryWinnersWhoLostTheirMillions.aspx
Published: December 10, 2008 1:53 AM
db0
Hey, thanks for all the attention people. I love you too.
Just came to note something
I did not promise that. I simply said that I created a series to contain any refutation I (attempt) to make. Doing everything is far beyond my capabilities and time.
Nevertheless, thanks for the free publicity. This humble blogger appreciates it.
Published: December 10, 2008 4:56 AM
Arend
Funny thing this blog is called "divided by zero", since a division by zero "cannot compute" in math, it's like calculating the tangens op 90 degrees...
This is precisely what happens in the reasoning of this blogger. He has the intelligence to go straight to the core and foundation of Hoppe's argument, which is after all not that difficult with such an transparant and clear writer as HHH (compare to Marx, Keynes, for that matter), and then just as an expression of rather subjective feelings and cognitive dissonance rejects this core and foundation not on HHH's own grounds or rather neutral reasoning but with biased versions of concepts as "class", "voluntary", "choice" and unrealistic hypotheticals such as "Now consider a hypothetical human who enters adulthood without any wealth.". Anyone has human capital, so how one can be without ANY wealth is beyond me. Furthermore, the 'refutation' gradually becomes Marx-inspired sneering with qualifications as the capitalist doing nothing while becoming richer, the capitalist not wanting to work and the capitalist being a societal parasite. While in feudal days these qualifications were in some extent true, but not applicable to capitalists in the ordinary sense, capiatlists in the ordinary sense did not break laws of property rights and/or violence or force. Divided by Zero is implying this by modifying the concepts of property and force by introducing a rather old and fallacious one named exploitation. While in the HHH example, the free market example, a capitalist is just a very skilled worker who did accumulate capital or was seen fit by creditors to bear the burden of uncertainty and risk (entrepreneurship), and in the process providing people work, because we all have needs to fullfil. And capitalism is just a peaceful and cooperative way to (without central authority) coordinate these processes.
Note to Divided by Zero: does you appreciation mean that you are prepared to refute mises articles in a somewhat more interactive way, i.e. via debate on this site?
Published: December 10, 2008 5:52 AM
Arend
Funny thing this blog is called "divided by zero", since a division by zero "cannot compute" in math, it's like calculating the tangens op 90 degrees...
This is precisely what happens in the reasoning of this blogger. He has the intelligence to go straight to the core and foundation of Hoppe's argument, which is after all not that difficult with such an transparant and clear writer as HHH (compare to Marx, Keynes, for that matter), and then just as an expression of rather subjective feelings and cognitive dissonance rejects this core and foundation not on HHH's own grounds or rather neutral reasoning but with biased versions of concepts as "class", "voluntary", "choice" and unrealistic hypotheticals such as "Now consider a hypothetical human who enters adulthood without any wealth.". Anyone has human capital, so how one can be without ANY wealth is beyond me. Furthermore, the 'refutation' gradually becomes Marx-inspired sneering with qualifications as the capitalist doing nothing while becoming richer, the capitalist not wanting to work and the capitalist being a societal parasite. While in feudal days these qualifications were in some extent true, but not applicable to capitalists in the ordinary sense, capiatlists in the ordinary sense did not break laws of property rights and/or violence or force. Divided by Zero is implying this by modifying the concepts of property and force by introducing a rather old and fallacious one named exploitation. While in the HHH example, the free market example, a capitalist is just a very skilled worker who did accumulate capital or was seen fit by creditors to bear the burden of uncertainty and risk (entrepreneurship), and in the process providing people work, because we all have needs to fullfil. And capitalism is just a peaceful and cooperative way to (without central authority) coordinate these processes.
Note to Divided by Zero: does you appreciation mean that you are prepared to refute mises articles in a somewhat more interactive way, i.e. via debate on this site?
Published: December 10, 2008 5:52 AM
db0
What's wrong with posting refutations on my own site? I have comments as well and it also becomes easier to find and bookmark for others.
PS: Yes, my name is a mathematical impossibility, it's also a programming error. This is why I selected it.
There's also the concept that a division by zero results in infinite.
Published: December 10, 2008 6:02 AM
marc
Like Marx before him, DB0 does not realize that he is conducting a criticism of merchantilism while calling it capitalism. It does seem as if Marxists are born and not created. Its hard to conduct a discussion with someone who does not see the difference between capitalism and merchantilism.
Published: December 10, 2008 7:05 AM
Michael
Come on Mr. Tucker,
Divide by zero, or whatever his name is clearly states, "I did not promise that [refute every article on mises.org]. I simply said that I created a series to contain any refutation I (attempt) to make." He's going to *attempt* to make some refutations, I guess.
Just another crank out there on the interwebs.
Published: December 10, 2008 7:18 AM
JB
Inquisitor - I agree with you in that regard. (Perhaps the more advance of product completion the payment becomes, the larger the discount?)
I was trying to directly refute the example that was given by db0 whereby: a worker who owned nothing material with which to sustain himself (herself) during any possible future production (as a result of getting hired) could / would be paid in advance of any labor if the employer deemed that the individual worker's labor be worth the investment of funds now ( with the amount determined by Supp - Demand) as opposed to later. The upfront funds would essentially be preventing the worker from otherwise becoming unproductive for the employer (i.e. taking a position somewhere else, dying, etc...) before producing.
Published: December 10, 2008 7:24 AM
Alex
Wow another Marxist posting economically and ethically base ideas that have been refuted since 1930!
/ignore
Published: December 10, 2008 7:47 AM
marc
Although it is tempting and neccessary for advancing truth, it seems futile to argue against a pathology.
Published: December 10, 2008 7:50 AM
Fephisto
I feel like I was the only one who got the joke. Either way, I hope he refutes this mises post ;D.
Published: December 10, 2008 7:51 AM
TokyoTom
Jeffrey, did he say he was going to refute all Mises.org articles, or to post a series of responses to those articles others point to and that he considers worth the challenge?
Published: December 10, 2008 8:03 AM
Arend
@ db0 who said "What's wrong with posting refutations on my own site? I have comments as well and it also becomes easier to find and bookmark for others."
You mean the one-sentenced void responses (such as the one to austro-libertarian), to multi-paragraph comments on your piece? Almost makes me think you're exploiting the commenters on your blog... :)
Published: December 10, 2008 8:04 AM
db0
That's a blatant lie. I countered all the points of austro-libertarian.
I certainly don't like discussing with liars, that's for sure.
PS: The groupthink in here...it burrrrrns
Published: December 10, 2008 8:13 AM
Jeffrey Tucker
Right, he didn't actually say that he would refute the whole of mises.org. I was being facetious.
Published: December 10, 2008 8:14 AM
db0
I would call it misleading but I do not mind so much seeing as you made everyone curious of me.
Published: December 10, 2008 8:20 AM
John Tate
My God, there are too many logical fallacies for me to go through, but the primary being Rand's classic 'Argument from Intimidation,' where he tries to do nothing more than brew bad feelings in his readers.
Published: December 10, 2008 8:40 AM
marc
DB0,
It is'nt so much that I am curious about you, it just is an opportunity to refute what seems to me fallacious beliefs. Like I said before, there is a differnece between merchantilism and capitalism. You seem to conflate the two, and then direct you arguments against capitalism without defining what "capitalism" is.
Published: December 10, 2008 8:53 AM
Arend
[quote]I would call it misleading but I do not mind so much seeing as you made everyone curious of me.[/quote]
It's this consequentialist approach that's characteristic of your reasoning in the exploitation piece as well. You don't like a situation and therefore call it exploitation. HHH analyzes the situation with a definition of exploitation and comes to the conclusion that the situation hasn't anything in common with the definition of exploitation.
[quote]That's a blatant lie. I countered all the points of austro-libertarian.[/quote]
With regard to the oldest comment of austro you didn't.
[quote]I certainly don't like discussing with liars, that's for sure.[/quote]
Who claimed you were discussing?
Published: December 10, 2008 9:03 AM
DixieFlatline
The last person who should be complaining about groupthink is a Marxist.
Published: December 10, 2008 9:22 AM
JA
The last person who should be complaining about groupthink is a Marxist.
I thought "groupthink" was a good thing for Marxists? Isn't that what they want, solidarity and such?
Published: December 10, 2008 9:28 AM
db0
My reaction fits the moral wrong which in this case was minor. Yes, I could condemn but it would simply look petty. But don't let me stop you from jumping to conclusions.Yes I did. The only reason you do not see it is because you didn't (and can't atm) expand the comments
Published: December 10, 2008 9:30 AM
db0
Who said I'm a marxist?
My being here, and actually reading your articles is all the proof I need against your accusation of groupthink.
Published: December 10, 2008 9:32 AM
Lucas M. Engelhardt
From Wikipedia: Groupthink is a type of thought exhibited by group members who try to minimize conflict and reach consensus without critically testing, analyzing, and evaluating ideas.
Now, it is true that there is a certain amount of that here. However, there is also a not-insignificant number of people here taking you seriously to some extent. That is, they are "critically testing, analyzing, and evaluating ideas"... in particular, your critiques of the ideas they hold to.
One thing I'll say for mises.org (there are lots more I COULD say, but choose not to): we don't shy away from discussion.
Published: December 10, 2008 9:34 AM
marc
db0,
Then your comment is superfluous. Obviously the people on this blog are going to your blog and reading your comments. So your accusation of group think is undermined by you own admission that all it takes to not be guilty of group think is the reading of different ideas.
Published: December 10, 2008 9:39 AM
db0
I did not accuse everyone of basking in groupthink. I simply pointed out that the comments in here certainly point to that effect.
Published: December 10, 2008 9:55 AM
Mark Knutson
Once, in an interminable argument with a blogger who was too ignorant to recognize my refutation of his logic, I realized that my taking the time to engage in debate with him had the unintended consequence of legitimizing his irrational assertions.
Don't know why this old anecdote came to mind, but thought I would share it... ;)
Published: December 10, 2008 10:22 AM
redshirt
I encourage mises.org folks to take this opportunity to reach more people. This is golden as it will funnel people right on in ... you could pick an argument here and there to answer and really clarify it for visitors.
It helps me when I see clearly stated responses here. Moralizing issues may be less effective than you think at convincing people... they quickly assume there is an agenda that reaches beyond the discussion. (Unless, of course, the discussion is about morality.)
LHR's article http://mises.org/daily/3248 is dead on the type of article I love to read here!
-r
Published: December 10, 2008 10:25 AM
shaneinwy
I think Jeffrey has stumbled on to something here. Mises.org can promise web traffic to other people if they promise to actually engage in debate/discussion.
Make it a seperate tab on the web page. The followers of Mises.org can get some good laughs, fine tune our arguements, and most important, enlighten through persuasion. Three birds with one stone....would this be consider exploitation of stones and stone makers?
Published: December 10, 2008 10:40 AM
redshirt
Oh wait... I read some more of that site. I don't think a serial discussion could be formed.
Published: December 10, 2008 10:41 AM
stephen Grossman
>Yes, my name is a mathematical impossibility, it's also a programming error. This is why I selected it.
There's also the concept that a division by zero results in infinite.
The attack on capitalism is an attack on man's mind. That's why he likes a math impossibility. He's a nihilist.
Published: December 10, 2008 11:05 AM
stephen Grossman
>Yes, my name is a mathematical impossibility, it's also a programming error. This is why I selected it.
There's also the concept that a division by zero results in infinite.
The attack on capitalism is an attack on man's mind. That's why he likes a math impossibility. He's a nihilist.
Published: December 10, 2008 11:06 AM
Bruno
DB0...you're kind of an old school marxist. I really do not understand why people like you still exists. I read some of your articles, mainly those labeled "Misunderstanding Communism".
Well, as far as I am concerned, I do "Misesunderstand Communism", what you do not. Why don't you write a rebuttal to Mises and Hayek criticism of marxist economy? I'm sure that's the main point of the austrian economists.
Published: December 10, 2008 11:10 AM
Inquisitor
db0, you countered precisely... nothing. As I noted, your "refutations" are marked by a distinct lack of understanding. Don't like being told to go read a book? Well then, don't try "refuting" things you don't even understand. Simple. I think people have given you enough attention. If you don't like liars, I suggest you rid of any mirrors in your house... Don't worry though, there's Nobel prize economists who cannot get their head around Austrian econ, so they rely on strawmen.
Published: December 10, 2008 11:15 AM
Enjoy Every Sandwich
I've certainly been exploited by an employer. My first employer after high school exploited me in the worst way. I had to work for slave wages in often uncomfortable, stressful, or even dangerous conditions. My very life would be put at risk, sometimes for the most frivolous of reasons.
That employer was...the U.S. government (specifically, the Navy).
I've been much better off since I went to work for the "evil" capitalists. They paid me more right from the get-go even though they had to spend money to train me. I make a good wage at a job I like even though I don't have a college degree. Of course I have to do my part: I have to demonstrate that I am worth the money and effort. To get more money I have to spend time and sometimes money to improve my skills.
Hiring a new worker costs the employer money, up front, money that the employer won't recoup until the employee becomes proficient.
Published: December 10, 2008 11:33 AM
Frank
"The answer is of course need."
Wow. I'm reading "Atlas Shrugged" right now. db0 "needs" to read this book.
Published: December 10, 2008 11:41 AM
Michael
Frank,
People like Mr. Divide by Zero (aka "Ghost of Departed Quantities") would balk at your suggestion.
Their goal is not to educate. It's to instigate.
Published: December 10, 2008 12:56 PM
YerMawm
OK. Reading comments from the current article, DB0 is just bitter because he wants to get paid before working. It appears he/she has never owned a business.
When I submit bills to my clients, and they pay me 5 minutes later. This is a fundamental way in which transactions are conducted.
I say the blogger needs to read and understand more about what money is. If you don't like the capitalists, save your money, and don't work for them. It is possible.
Why should the world be fair? Nature does not allow it. Even if central planners provided everything, at some point they must decide who eats/starves, who lives/dies due to limited resources? The truly fair way is for nature to decide.
Humans may have been created equal, but are not all the same. We each dream alone, and you cannot plan for that.
Published: December 10, 2008 1:55 PM
Joe
I can't read that blog for more than 10 minutes due to the horrid color scheme. My eyes hurt. Probably not worth my time anyways.
Published: December 10, 2008 2:40 PM
Reason
It is still important to spend the time to refute, combat and dispel his arguments. The popularity of an ideology does not depend on its rightness. Mises did say that the 1930s proliferation of fascist economic programs was the result of decades of anti-capitalist teaching taken to its logical conclusion and put into action.
I am sure db0 is not the violent kind. Yet Hayek warned about the necessity of violence to complete a closed system. Hence the most thuggish become the most powerful. Poor db0 would most likely become his namesake in such a system. Recall Stalin's Trotsky, Hitler's Strasser, .....Obama's Rev. Wright (ok maybe not so much this last example).
Published: December 10, 2008 3:18 PM
Lucas Engelhardt
My point-by-point refutation:
http://engelhardtlm1.livejournal.com/135503.html
Published: December 10, 2008 4:37 PM
Christopher Lewis
Yermawm,
Silly you. You forget that people in dBo's world live by equality of result, not equality of opportunity.
It is his basic misunderstanding, or perhaps, as he so readily admits, his lack of knowledge, of markets and values.
By the way, I pointed that out to him. So when I went back to his blog to see if he had responded to my critique, I found that my comment had been erased.
That was very Brad DeLong'ish of him.
Published: December 10, 2008 4:37 PM
db0
That's ridiculous. Why would I delete your comment specifically? Did it occur to you that you might have been caught in moderation?
I will check now to see if that is the case.
Published: December 10, 2008 4:44 PM
Jack Skylark
Good job Lucas. We now just need to hope db0 reads it.
Published: December 10, 2008 4:46 PM
Tomb Like Bomb
"Natural rights"? Read Bakunin's response to Proudhon on this. Read Proudhon's own words, too. Feel free also to study a bit of history before declaring things "natural". Was it the primitive accumulators' natural right to dispossess? A true anarchist is truly against expropriation. An Austrian is against only future expropriation and is quick to defend all past expropriations from reasonable remedy. Such conservatism we find to be the primary cause of this present wealth distribution...or for one who hasn't reified property, this present distribution of prohibitions of access.
When the workers take "your" factory, they do not believe it's yours. They believe it's theirs. Your conflict is not a conflict of rights vs. no rights; it's a conflict between mutually incompatible rights. On the one hand, we have the absentee owner's professed right to some earned, inherited, or stolen thing; on the other hand we have that of the producers.
Published: December 10, 2008 5:16 PM
Eric
I don't understand something about db0. He claims to not be a Marxist, but his blog is full of apology for the Marxist position, and he attempts to refute the "anarcho-capitalist" libertarian economic position.
The only thing I can figure is that he hasn't yet really staked out a position except perhaps one of resident contrarian. Maybe he could clear this up for us. If I knew what positions he actually held, it would be easier to mount an argument against said position. As it is, he doesn't really have a position, so he's really just stirring up a hornets nest in a most dishonest way.
Published: December 10, 2008 5:32 PM
db0
What difference does it make for my refutation what my position is? You can judge if I am correct or not from the arguments I make no?
The only reason I assume you wish to know my definite position is so that you may shift the attention to critique of that instead of the arguments and positions I am actually proposing.
But you are correct however in that I do not have a position staked but not because I am contrarian, but because I find my own position from the best parts of each. I have gotten into brutal flamewars with Marxists in the same way that I get with AnCaps. Not because I like to stir controversy but because I do not walk the beaten path.
If you still insist on finding a position to attack, fine. I'm an Epicurean.
Published: December 10, 2008 6:48 PM
Brian Gladish
Tomb,
Von Mises did not believe in natural rights. If you find it interesting, you can read Theory and History (or the longer Human Action) to get a better feel for what he had to say on the subject. He also believed that it was useless or worse - counter-productive - to use confiscation or forced transfers of property to remedy past "injustices," however one might define that word. We have a better chance of producing a peaceful, prosperous society if we look to the future rather than trying to remedy failures in the past.
Published: December 10, 2008 6:51 PM
db0
Isn't that just a tad convenient?
Published: December 10, 2008 7:08 PM
Paul
Another stomach-knotting Marxist 'refutation' of Austrian economics. I'm just glad others do the work of refuting these Marxists.
This is another bad one: http://kapitalism101.wordpress.com/
Another cool site:
http://www.socialistworld.net/
Published: December 10, 2008 7:40 PM
Tomb Like Bomb
Brian,
I realize that the famous few--this goes for Austrians as for Marxists--are less sentimental, less moralistic, than their followers. But their followers, including the person to whom I was responding, in that case explicitly, do invoke these "rights".
As for Mises' a priori model of the human mind, it's not the most counter-intutive of such a priori models, but neither is it the least. If Mises' mind is anything but tautology (I'm thinking of Hobbes giving to the begger to ease his own pain), then it's nothing like my experience with my own mind. The evidence, where Mises is allowed to be falsifiable, falsifies his theory, and the Austrians' only response seems to be that subjects are acting "irrationally" for the vaguely-defined goal that Mises has insisted they must have. Mises literally dehumanizes such people.
That non-essential part of Marxism, the labor theory of value, was inherited from the early laissez-faire heroes, and I know of few socialists or Marxists who today accept it. But from any theory of value, including marginalism, it's hard to make an argument for the status quo wealth distribution (funny, Austrians are not so cautious of change when it comes to things as radical as the abolition of taxes).
Finally, Mises' "calculation problem" is answered by advances in communication, as well as rather ingenious models of decentralized non-capitalism, such as Michael Albert's Parecon, which, like other libertarian socialisms, has shown success where it's been permitted to exist.
Published: December 10, 2008 8:12 PM
Joe Brochu
The reason that Mises.org readers may appear to engage in "Groupthink" is that Austrian economics is the product of deductive, logical reasoning derived from axiomatic principles. One could also say that mathematicians engage in groupthink - but again it is only because they have each followed the same rigorous logic to get there. In light of this, I'll leave db0 alone on the title of his blog and spelling of "infinity"...
The danger of populist rhetoric is that it is immediately romantic and appealing without requiring the reader or writer to follow the logic all the way through. The common approach is to use the “fairness” axiom to justify active coercion of whoever has saved more than someone else at a given moment. I have yet to see a populist solution that doesn’t start with violence and end in mass starvation (and more violence).
See my full response at http://timandjoe.wordpress.com/2008/12/11/counter-argument-to-db0s-refutation-of-misesorg/
Published: December 10, 2008 8:54 PM
TokyoTom
I was being facetious.
You puzzle me, Jeffrey. If you don't really want to engage this guy seriously, then why give him any notice - particularly notice in the form of a mob attack? Does this show our strengths or cast us in a good light?
And seriously, why does this guy deserve our attention, as opposed to Brad DeLong, who has been much more derisive of von Mises and Austrians of late - and who we are still linking to?
Just curious.
BTW, you might consider adding a link to Bob Murphy, now that he has his own blog.
Regards,
Tom
Published: December 10, 2008 9:25 PM
Robert Brager
"The evidence, where Mises is allowed to be falsifiable, falsifies his theory, and the Austrians' only response seems to be that subjects are acting "irrationally" for the vaguely-defined goal that Mises has insisted they must have. Mises literally dehumanizes such people."
- Tomb Like Bomb
The passage I quote above seems to me to be a fundamental misinterpretation of Austrian economics and anything remotely like Mises had to say about "irrational" action. Here's what Mises actually had to say, as he does in the pages of "Human Action", about "rationality" and "irrationality":
"Human action is necessarily always rational. The term “rational action” is therefore pleonastic and must be rejected as such. When applied to the ultimate ends of action, the terms rational and irrational are inappropriate and meaningless. The ultimate end of action is always the satisfaction of some desires of the acting man. Since nobody is in a position to substitute his own value judgments for those of the acting individual, it is vain to pass judgment on other people’s aims and volitions. No man is qualified to declare what would make another man happier or less discontented. The critic either tells us what he believes he would aim at if he were in the place of his fellow; or, in dictatorial arrogance blithely disposing of his fellow’s will and aspirations, declares what condition of this other man would better suit himself, the critic.
It is usual to call an action irrational if it aims, at the expense of “material” and tangible advantages, at the attainment of “ideal” or “higher” satisfactions. In this sense people say, for instance—sometimes with approval, sometimes with disapproval—that a man who sacrifices life, health, or wealth to the attainment of “higher” goods—like fidelity to his religious, philosophical, and political convictions or the freedom and flowering of his nation—is motivated by irrational considerations. However, the striving after these higher ends is neither more nor less rational or irrational than that after other human ends. It is a mistake to assume that the desire to procure the bare necessities of life and health is more rational, natural, or justified than the striving after other goods or amenities. It is true that the appetite for food and warmth is common to men and other mammals and that as a rule a man who lacks food and shelter concentrates his efforts upon the satisfaction of these urgent needs and does not care much for other things. The impulse to live, to preserve one’s own life, and to take advantage of every opportunity of strengthening one’s vital forces is a primal feature of life, present in every living being."
- Ludwig von Mises, "Human Action", Chapter 1: "Acting Man", section 4, page 19.
I see an elevation of life here, contrary to the contentions of the individual to whom I am responding. Insofar as a tendency toward "dehumanization" within an ethos, it is difficult to find a more perfect exemplar than coercive socialism (I'm not interested in defaming anarcho-socialists here), possessing an emphasis as it does on minimizing the individual in favor of the mob.
But, hey, that's just me.
In any case, I haven't looked over dbO's blog too much, but I find it creditable that he appears game for a discussion here. Pity then that there appears to be little traction in moving this discussion more to the exchange of ideas and less an exchange of "I already know what you're going to say, so why should either of us bother?"
Published: December 10, 2008 9:51 PM
Inquisitor
Did Bakunin address theories outlined by the likes of Douglas den Uyl or Rasmussen? No? Then it's unlikely he has even touched upon libertarian rights theories. Unless and until I see a convincing refutation of their positions, I could not care less what Bakunin had to say to Proudhon. Rights have nothing to do with "sentimentalism" or whatever other nonsense you wish to conjure up.
"As for Mises' a priori model of the human mind, it's not the most counter-intutive of such a priori models, but neither is it the least. If Mises' mind is anything but tautology (I'm thinking of Hobbes giving to the begger to ease his own pain), then it's nothing like my experience with my own mind."
What are you on about? Psychological egoism?
As for the calculation problem, I've yet to see it addressed by any one who has actually comprehended it and seen responses to the like of Langer, without repeating their errors. The argument does not generally apply to syndicalist models of organization, whatever other problems they might have. Mises's original argument was formulated to address state socialism, of course. But it can and has been extended by the likes of Rothbard and Reisman. The excerpts I have seen by Parenti do little to convince me they've understood Mises. Advances in communication may answer Hayek's objection, but so what? Have any of Mises's detractors bothered reading the huge material on the calculation problem within the Austrian school? They show no evidence of it.
Published: December 10, 2008 9:58 PM
Alex
People like this DB0 are a pox on society and it's ideas. It's probably better to ignore them, instead of giving them attention.
Just some two cents.
Published: December 10, 2008 10:04 PM
jeffrey
Well, this guy is more fun than DeLong, though I think I linked to him too.
Published: December 10, 2008 10:05 PM
Peter
Tomb: as usual with the anti-Austrian crowd, you don't know what you're talking about - you just make stuff up to suit. All evidence supports Misesian theory (of course), and no Austrian would ever say that "subjects are acting irrationally", since that has no meaning within an Austrian understanding of rationality of behavior.
Published: December 10, 2008 10:15 PM
Inquisitor
Ugh, not Parenti... Albert*
Published: December 10, 2008 10:45 PM
William Rader
I went to http://kapitalism101.wordpress.com/ and found the following pearl of wisdom in the midst of an article with the unlikely title of "Felix the Cat and Capitalist Competition": "Gold has value because it requires a very involved labor process to MAKE." I may be wrong here, but I always thought that gold was a native element, which, like any other mineral, is naturally occurring. Little did know that man in his infinite wisdom has made gold!
Published: December 10, 2008 11:51 PM
Gary Connolly
I think only one commenter here actually tried to address Db0's points instead of just calling him a marxist and high-fiveing his buddies. Having read both Db0's post and the refutation that was linked I really don't know why so many of the commenters here are so quick to dismiss him. I think he made valid points and the refutation was awful. I am assuming that there are better arguments to be had in refutation of Db0 and it's a shame they were not presented instead of smug dismissal
Published: December 11, 2008 4:11 AM
db0
Thank you, thank you! I'll be here all day.
@Gary Connolly
Thanks. To tell the truth I was a bit surprised at the kind of bile a simple refutation received. I would expect that intellectuals would welcome a challenge and at least appreciate a "marxoid" reading what they have to say and attempting to open a discussion.
This is what I mean with groupthink, not that everyone is closed to freethought, but that the majority simply dismissed me out of hand and cheered for others who did the same.
Yes, some did comment on my blog but (it seems to me) started with the assumption that I was wrong
and looked for evidence to prove it. This is why the concept of "risk" came into play, when it did not even exist in Hoppe's argument.
Published: December 11, 2008 5:05 AM
Eric
Gary,
I read through most of the posts here, and I have to agree with you. The great thing about db0 is that he made me really strive to refute what he was saying. Always reading material by people who agree with you is easy. Reading disagreeing opinion is difficult. db0 has made me think about the solidity of my position for a day now. Every road I've gone down has its problems. For me, it boils down to the questions: "Should everyone be socially or economically equal?" or "Should everyone be legally equal and able to economically advance based on ability?" This is really the crux of the issue, where socialism/communism and capitalism depart. I'm still thinking about it. I'll get back to you and db0 when I have what I think are some good arguments/refutations.
Published: December 11, 2008 5:36 AM
db0
Thanks m8, this is the best compliment that I could have asked for.
Published: December 11, 2008 5:41 AM
Matador
@Gary Connolly
While I agree there's a little too much dismissal going on here, there have been substantial arguments made as well. I would especially like to single out Lucas Engelhardt for honours, though you'll have to follow the link to his site to read his exhaustive rejoinder.
Published: December 11, 2008 9:41 AM
Reason
Tomb like Bomb,
Even a self-declared lefty intellectual has labeled Michael Albert's Parecon "terrible".
http://homepages.luc.edu/~dschwei/parecon.htm
This critique follows a general Hayekian analysis that exposes the impracticality of Parecon. The author, not a fan of capitalism, also explains why incentive issues will lead to very serious problems, like violent jealousy and baring false witness.
The critique does not address whether Albert’s Parecon refutes Mises's refined observation that prices are indispensable for an economy outside of autarkic farms and localistic barter.
Prices, which only evolve out of the exchange of private property, provide the necessary factor in solving the economic problem: How to compare heterogeneous resources for production, choose among myriad methods and combinations for creating an inestimable number of possible goods and services that meet the gazillion incongruent demands of billions of people, while being confined to the reality of evolving scarcity with limited current -and no future- knowledge of an ever changing environment and demand… in the optimal way?
Prices express a lowest common denominator needed for monetary measurement and, hence, economic calculation. It then becomes possible to evaluate actions socially, understand opportunity costs, via profit and loss. Prices serve as the compass by which a complex system of division of labor can be mapped out. Prices, and therefore private property, are necessary for a progressive society.
Does Albert, or you even, understand the economic problem?
Published: December 11, 2008 9:59 AM
Curt Howland
I read some of db0's work, and I note that he is writing right out of "The Anti-Capitalist Mentality" and Hoppe's "Intellectuals" (as opposed to his anti-intellectual intellectuals).
Just another lazy pudknocker who thinks the world owes them a living.
Published: December 11, 2008 10:06 AM
Curt Howland
Unfortunately, it seems my reply won't post there. What a awful site!
"That urgent need can only ever be food or shelter."
You ignore the entire spectrum of human wants and needs, here. Even with food and shelter, people "want" a car, cable TV, more shoes, a dress coat, whatever. If your hypothesis were correct, no one would pay more for a game console today, when it's popular, than next year when it's not.
No one would see a movie for $7, when they could wait 3 months and rent it for $3.
Yet people do, all the time.
"[B]ecause they do not own any means of production."
This is a false statement. Each person owns their own labor, which is the primary means of all production. If they did not own themselves, they could not decide whether or not, or to whom, to sell their labor.
If what I produce is in demand, maybe I'm a good programmer, my production can be sold for a high price. If what I produce is not in great demand, maybe all I know to do is shovel dirt, I will not be able to sell my production for a high price.
But if what you need is dirt shoveled, are you going to hire a high-priced programmer with fragile wrists to do the job? No, that would be absurd, and is a perfect demonstration of the division of labor and why it makes everyone better off to allow people to do what they do best.
"It is beneficial for the Capitalist who can select a low wage for the starving worker, but it is not beneficial for the worker who might only get a present value enough to simply sustain himself until the next day."
So the dirt shoveler starves, rather than take the low wage? And this somehow makes him better off?
For that matter, the evil "capitalist" here doesn't get his dirt shoveled, but gets to keep some pocket change. The very fact that he was willing to pay for the dirt to be shoveled meant he valued that work being done more than he valued the money.
The fact that the dirt-shoveler values the money he can make shoveling dirt more than the leasure of not working today, is a demonstration of how free trade makes everyone more wealthy. Each gains more than they would by not trading in the first place.
Yes, some people cannot produce highly valued labor. That is a simple fact of life. If what you want is to make life better for those people, you are going to be far more effective in doing so by inventing powered shovels and other CAPITAL GOODS which multiply the effectiveness of labor, making it more valuable.
A dirt-shoveler with a back-hoe can produce far more value than a dirt-shoveler with only his own hands. That's why people pay more for their production, even though it's the back-hoe that did the "work".
But this is also the refutation of the "evil capitalist". Just as the back-hoe multiplies the earning potential of a dirt-shoveler, having more capital to work with multiplies the earning potential of the "capitalist". They have a more powerful tool to work with producing value with their labor.
That's why economists use the word "capital" to describe both money and the back-hoe. It also describes the hand shovel with which our dirt-shoveler does his least effective labor. So we're all "capitalists", because we all leverage our own capital in our efforts to be paid the highest value for our labors.
Published: December 11, 2008 10:40 AM
Inquisitor
db0, the problem is that you lack ANY understanding of economics. So be thankful if refutations of your nonsense are "simple". You simply do not know what you are talking about. Do you expect people to write entire treatises refuting simplistic garbage?
Re parecon, if it involves worker ownership (as in PRIVATE ownership) of the MOP, then it can evade the calculation problem. Syndicalism can because of that. If it does not, then no, it cannot.
Published: December 11, 2008 12:10 PM
Inquisitor
Gary, why don't you try refute the refutations, instead of insisting they're "awful"? Go on, then. And please prove you have an understanding of Austrian econ in so doing. If you do not, your comments will be largely irrelevant nonsense, like db0's.
Published: December 11, 2008 12:15 PM
db0
I lack ANY understanding of christian theology, and yet I can argue with Christians. Go figure...
Published: December 11, 2008 12:17 PM
db0
PS: That's not strictly true, although even if I hadn't, I would still be able to argue with theists.
Published: December 11, 2008 12:24 PM
Curt Howland
> I lack ANY understanding of christian theology, and yet I can argue with Christians. Go figure...
db0, this is a perfect example.
You can argue with anyone, true. But if you try to argue on a subject which you know nothing about, all you'll do is annoy people.
By refusing to read any of the volumes of materials previously written, and much better written than an off-the-cuff blog reply could be, you are demanding that people re-re-re-re-refute the same tired old arguments.
It would also be nice if you were to present what you think is your insight as a postulate, rather than an axiom.
Like, "How do you deal with this or that?", instead of, "You idiots haven't even seen fit to consider this OR that!"
Just because you weren't exposed to the Austrian process of economics by your teachers who have a vested interest in not teaching it to you, doesn't mean the Austrian process is mistaken, or hasn't fully dealt with these objections before.
Published: December 11, 2008 2:26 PM
db0
And yet, this is untrue. I do not have to know anything at all to point logical inconsistencies in Christian arguments. I do not have to know all the fine arguments of christian theologers to decide that the Christian god does not exist.
In a similar vein, I do not need to have studied Austrian economics in depth before I can point obvious (to me) inconsistencies or decide that they do not work. The burden of proof is not on me to in this regard.
I'm a blogger, that's what I do, write of-the-cuff stuff. And I did not demand anything, rather it was the misleading link of this blogpost that drove all people to my site attempting to point out how ignorant, lazy, fallacious or plain stupid I must be for daring to critique something I noticed as wrong.
Your arguments can just as well be coming from a theist. This is not to say that you are treating austrian economics as a dogma but rather that you use the same kind of courtier's reply.
If one thing that annoys most about AnCaps is how easily they jump to conclusions. I have had no teachers. I am self-tought.
If your austian school has dealt with my refutations and you believe they are not worth it, you have to choices, refute me or ignore me. The third choice of personally attacking me serves noone it seems to me.
Published: December 11, 2008 3:42 PM
(8?»
I don't see the point in arguing over belief systems where well ingrained perspectives simply will not allow any valid "out-of-the-box" thinking to occur.
Db0 has no need to understand economics (meaningful human action, that is, not silly formulas) because it isn't a part of his world view of exploitation. Nor is he interested in undermining his world view by acquiring any new perspective.
All he is interested in is reinforcing his world view by refutation of anything that challenges it.
You know, he is fighting the good fight! Just like everyone who feels the need here to refute him.
Problem is, this fails to advance knowledge, instead "strengthening the resolve" of resistance to it.
Belief systems are powerful things. To think they can be logically refuted, is to not understand the nature of beliefs and the pretense of knowledge attached to them. They form our very image of conscious self. To attack them, is to attack their owner's identity.
Only those that want to see things in a new light, can. The rest will fight vainly in order that their sacred ideas remain "true." (Like the idea around here that Professor Fekete is a crank, because he dares question the Austrian idea of a 100% gold standard. )
Is this really worth fighting for? Or is it merely a retardation of human understanding under the guise of fostering it?
I'll also note, that fighting the good fight feels really good, especially when on home turf. Which means, that each blog will focus on the perspective of the beliefs of their posters, while ignoring the counter-arguments as being moot, all in order to show how their side is winning, and the other side are idiots.
Game On!
Published: December 11, 2008 4:07 PM
Joe Brochu
In response to the suggestion (on db0's blog) that a capitalist still earns $2 for nothing if there are $3 worth of material costs required for production, and he charges $15 for the widget:
So what is the moral solution here? If the capitalist is removed from the picture, each worker can collect $15 for the widget he has created, netting $2. It's a perfect world.
However, who is buying this widget? Why are they required to pay more for it than it cost to produce? Isn't the buyer in fact the person who is being exploited here?
Let's consider the buyer's identity:
1. Capitalist - Since $15 is more than an exploited worker could possibly accumulate, and is more than the $10 required for sustenance, this must be a luxury item that only exploitative capitalists can afford. But since this capitalist hasn't done any work to earn his $15, this money really belongs to other workers. So now our workers are exploiting other workers and have become greedy capitalists themselves.
2. Worker - let's imagine that a worker starved himself enough to save $15, and can now buy the widget. In this case our workers are gaining from a fellow worker's choice to starve.
So to preserve fairness (every worker receiving the full value of his labor), the widget should only be sold at cost. Likewise, widget B produced by the buyer should be sold at cost to avoid exploiting worker C, and so on. This results in a sustenance economy with no additional capital or incentives available to enact improvements.
And since there are no capitalists with extra money saved, the only viable goods are those required for survival, meaning that our factory will close down and the workers will all be back out on the street. Everyone starves.
Published: December 11, 2008 6:11 PM
Alex
Another big problem around here is that people still see the need to argue simple ethics and economics. If someone dismisses the labor theory of value, or marxism, as being bogus, people come to 'rescue' of the dimwitted person who put forth the idea; for surely, can't we second guess all assumptions?
The thing is, arguments like this have been made, over and over again, in only slightly different ways, for a very long time. Basically, most transactions between two consenting people, without force or coercion, are ethical and normal. Basically, you cannot calculate without the market. Basically, socialism and communism are unworkable in their pure theory forms; major adjustments need to be made to them in order to merely work at a very poor level. And the argument there is that if they are not workable in pure theory, then the systems that they represent probably are not communism or socialism.
DB0 seems to admit not having an understanding in economics, and brushes this aside as being unecessary. I shouldn't have to explain to any poster - including zero - on why understanding economics is important, especially if someone is going to describe how the world works and should work.
He says that not only does he argue with Christians, he also doesn't know theology.
There are some things that someone does not need to have a great understanding to argue, such as ethics. The idea that we largely know what is right or wrong is commonly referred to as ethical intuitionism.
However, hard (and soft) sciences are not things people intuitively understand. Also, soft economic science is prone to corruption, as DB0 has shown; politics get in the way of not only understanding, but also of comprehension.
I could go further, but all of the points against DB0 have been made, and a long time ago - mostly by the person who carries the namesake of this website.
I will leave it up to fools to argue with someone who is still more foolish than they are, and the backstabbers to try to gain favor from DB0 by critizing other austrians because... well, because he makes good points, damn it!
We really have passed the stage where socialism, communism, and big government had any real ethical or economic claim to superiority. Stating this - and moving on - is not a sign of dreary dismissal; it's a sign of understanding, and not wanting to wade in intellectual muck and stupidity that has been around for nearly 100 years.
Argue with this fool if you must.
Published: December 11, 2008 6:16 PM
Curt Howland
Db0, "I do not have to know all the fine arguments of christian theologers to decide that the Christian god does not exist."
But then you're not arguing theology.
Are you saying that economics doesn't exist? No. You _say_ you're pointing out inconsistencies.
However, with post after post pointing out how you were wrong in your basic assumptions, I have seen nothing from you addressing those corrections.
I have yet to see anything from you to alter my initial impression that you are merely a lazy malcontent rationalizing about how the world owes you a living.
Published: December 11, 2008 7:04 PM
Tomb Like Bomb
The Parecon critique is an amusing worst-case-scenario. Nevermind that it's indicative of nothing like the human behavior witnessed in the real world. It's just a list of things that could happen, and he makes them all happen to Parecon. Worker A has an affair with Worker B's wife, for example; Worker A responds by giving Worker B a low rating. Well, I don't remember Albert promising Parecon would solve every odd problem and make your dick bigger too. Yes, the ratings represent an increase in the individual worker's power, to be used for good or evil. The alternative is, when the capitalist expects his employee of screwing his wife, he doesn't bother with taking a tenuous dock-his-pay case to an evaluation committee, but only maybe ruins his life by firing him.
Published: December 11, 2008 7:13 PM
Joe Brochu
db0 states: "If one thing that annoys most about AnCaps is how easily they jump to conclusions. I have had no teachers. I am self-tought."
At the risk of repeating myself, Austrian economists tend to agree with each other because they have started with a few basic axioms and individually followed the same process of deduction to arrive at similar conclusions. Do Mathematicians "jump to conclusions" when they agree that pi is an irrational number (or that 2 is spelled "two")?
This is what sets Austrian theory apart from other theories of economics which tend to start with a problem and try to figure out how to solve it based on the resources at hand.
This stuff does not take years of study. I have been reading Austrian literature for about a month, and I have a good enough understanding of it to see why populist systems don't work (see my previous comment and blog).
I don't think populist systems are morally wrong - they generally have some very noble principles. I would love to live in a world where a hard day's work earned the right to any good I wanted. But Austrian reasoning - specifically an understanding of scarcity - shows very clearly why they don't work.
I'm an engineer. If I design a mechanism that doesn't work, I have to reconsider the design and find a way to make it work - or consider an alternative solution that has been shown to work. If someone builds a bridge based on my faulty design, it will collapse and people will die. This is true even if my bridge was very appealing to look at and solved a problem that no other design could.
db0 states: "If your austian school has dealt with my refutations and you believe they are not worth it, you have to choices, refute me or ignore me."
The problem is that populist rhetoric like yours is immediately appealing to anyone, as was my bridge design. However, when you put in the effort to thoroughly analyze the proposed solutions, you can clearly see where the problems lie.
If you were able to successfully convince a majority of voters that communism is the ideal system, or that my bridge is the perfect solution, these systems could be enacted.
Just as an understanding of mathematics can show why the bridge will fail, an understanding of Austrian reasoning shows why communism doesn't work. Therefore the Austrians need to persistently challenge anyone who tries to win people to their cause without understanding all of the consequences.
Published: December 11, 2008 7:55 PM
Tomb Like Bomb
"I would love to live in a world where a hard day's work earned the right to any good I wanted. But Austrian reasoning - specifically an understanding of scarcity - shows very clearly why they don't work."
A chipmunk knows about scarcity. Does Austrian reasoning show that the statement "a hard day's work earned the right to any good I wanted" has ever been uttered by a populist?
"I'm an engineer. If I design a mechanism that doesn't work, I have to reconsider the design and find a way to make it work - or consider an alternative solution that has been shown to work."
Unless, that is, you're an engineer of synthetic a priori, like the Austrians, in which case your design self-evidently works. But in your capacity as a real engineer, your mechanism presumably is expected to achieve certain goals, and its claim to "work" is falsifiable by the results. Of course populism doesn't achieve the goal of Austrian economics: the goal of Austrian economics, "rational allocation", is defined as the allocation resulting from Austrian economics! Populism, on the other hand, has goals that put it to the test. If populism were shown to make people less healthy, less informed, more dissatisfied with their government, less socially mobile, etc., that would populism's case.
Published: December 11, 2008 9:32 PM
Tomb Like Bomb
"I would love to live in a world where a hard day's work earned the right to any good I wanted. But Austrian reasoning - specifically an understanding of scarcity - shows very clearly why they don't work."
A chipmunk knows about scarcity. Does Austrian reasoning show that the statement "a hard day's work earned the right to any good I wanted" has ever been uttered by a populist?
"I'm an engineer. If I design a mechanism that doesn't work, I have to reconsider the design and find a way to make it work - or consider an alternative solution that has been shown to work."
Unless, that is, you're an engineer of synthetic a priori, like the Austrians, in which case your design self-evidently works. But in your capacity as a real engineer, your mechanism presumably is expected to achieve certain goals, and its claim to "work" is falsifiable by the results. Of course populism doesn't achieve the goal of Austrian economics: the goal of Austrian economics, "rational allocation", is defined as the allocation resulting from Austrian economics! Populism, on the other hand, has goals that put it to the test. If populism were shown to make people less healthy, less informed, more dissatisfied with their government, less socially mobile, etc., that would weaken populism's case.
Published: December 11, 2008 9:33 PM
Joe Brochu
TLB: "Does Austrian reasoning show that the statement "a hard day's work earned the right to any good I wanted" has ever been uttered by a populist?"
db0: http://dbzer0.com/blog/misunderstanding-communism-its-not-stagnant
db0 does not understand (or at least accept) that scarcity is a current inevitable reality.
TLB: "If populism were shown to make people less healthy, less informed, more dissatisfied with their government, less socially mobile, etc., that would weaken populism's case."
Russia. China. Cuba. Venezuela. Zimbabwe.
In what way is Austrian thinking not falsifiable? It rests entirely on axioms that could be proven false. These axioms could lead to conclusions showing that we're all doomed to cannibalize each other through selfish trade. Luckily, it turns out that the sum of all of these actions results in more people getting more of what they want, in a self-reinforcing loop. I see this as a good thing.
If you mean to say that the Austrian free market system has yet to be tested, I would agree with you. Let's get rid of some (or all) governments and see what happens.
Published: December 11, 2008 10:16 PM
Joe Brochu
Further to my last statement - If you have criteria against which you can test one economic system, why can't other systems be tested against that same criteria?
The fact that a free market isn't synthetically engineered to meet specific goals makes it that much more falsifiable - it can't be tampered with.
Published: December 11, 2008 11:03 PM
Peter
I would expect that intellectuals would welcome a challenge and at least appreciate a "marxoid" reading what they have to say and attempting to open a discussion.
That may be true, but when you start by saying "I know nothing about the subject, and I don't intend to learn", there's not much room for anything other than scorn - certainly "discussion" is out of the question.
Published: December 12, 2008 6:45 AM
Peter
Like the idea around here that Professor Fekete is a crank, because he dares question the Austrian idea of a 100% gold standard
And he is a crank, but that's not the reason.
Published: December 12, 2008 6:53 AM
newson
to 8?:
dr fekete is in good company, mike sproul is a regular on this site. mike's interpretation of real bills doctrine makes more sense than fekete's, if you buy the theory, that is. i don't, but he's a worthy and courteous debater.
db0 serves mises.org well.
i'm guessing tomb like bomb is not married. and has no employees.
Published: December 12, 2008 9:10 AM
db0
Btw, this is exactly what I'm talking about when I mention groupthink
How dare anyone claim that I raise a good point! He must be either a bigger fool than I am or a backstabbing traitor.
Woe to him who dares to not agree that I am a complete dunce.
Published: December 12, 2008 2:48 PM
Tomb Like Bomb
Robert,
Doesn't Mises say that individual rationality is what separates us from the animals? You tell me he says, no one can tell me I I'm not acting individually rationally; but what if I say I'm not acting individually rationally! He tells me I am but just don't know it. In the tautological sense, sure, I perceive individual rationality everywhere: myself, other humans, and other animals. But in no meaningful sense of "individual", or "rational", do I put the whole or even most of my involvement in decision-making.
And even if we presume first that man is self-interested, and second, that that self-interest is best left without the hindrance of repressive social systems, I see that as rather an argument AGAINST capitalism. The egoist tradition is least offended, as I see it, by the anarcho-communists of the Goldman variety. There, I'm only expected to deny my desires when they step over the line of that small part of the world occupied by others' minds and bodies. With anarcho-capitalism, I'm expected to deny my desires whenever they cross the line of that near-totality of the world occupied by what society, via the now-deposed government, has determined to be owned by others.
Joe,
I believe you've misunstood Misunderstanding Communism. The Marxist transitional stage is meant to be consumption IN PROPORTION TO LABOR, not infinite consumption by virtue of a specific amount of labor.
Cuba, the Soviet Union, China, and Venezuala, were all impovements over their pre-revolutionary selves by most criteria. By same criteria, they were also improvements over most countries that were of similar standing at the time of revolution. Austrians like to compare the Soviet Union to the U.S. The Soviet Union was a third world country at the time of its revolution! Why not compare the Soviet Union to like nations that, unlike the U.S., followed a more consistently free market trajectory. Brazil is a good candidate on both counts. Why not compare Cuba to its Carribean neighbors (and even ignore the sanctions if you want). Why not compare Venezuala to its neighbors or even other oil-rich nations. Read Latinobarometro, get the people's opinion. Or make a visit. Zimbabwe's rhetorical populism has been mismanaged, of course, but even the right-wing economists are quick to point out the lack of foreign investment due to frequent nationalisation. That's called a virtual parliment, and it's not so much an indictment of local "populism" as it is an indictment of global capilalism.
Published: December 12, 2008 3:50 PM
Vanmind
Needers know their needs
There is no human action
Just exploitation
All is not yet lost
Marxism can still triumph
Elect Dear Leaders
Be North Korea
Enact socialist planning
Good times lie ahead
Ignore your hunger
Collectivism provides
There are no more needs
Published: December 12, 2008 4:24 PM
Tomb Like Bomb
"Needers know their needs
There is no human action
Just exploitation
All is not yet lost
Marxism can still triumph
Elect Dear Leaders
Be North Korea
Enact socialist planning
Good times lie ahead
Ignore your hunger
Collectivism provides
There are no more needs"
In the middle of 1984, I take it? Spoiler: Orwell was a socialist.
Published: December 12, 2008 5:17 PM
Tomb Like Bomb
"Needers know their needs
There is no human action
Just exploitation
All is not yet lost
Marxism can still triumph
Elect Dear Leaders
Be North Korea
Enact socialist planning
Good times lie ahead
Ignore your hunger
Collectivism provides
There are no more needs"
In the middle of 1984, I take it? Spoiler: Orwell was a socialist.
Published: December 12, 2008 5:43 PM
Vanmind
Not much of a spoiler, since I already knew as much. I read 1984 in 1983; Orwell/Blair was a Social Democrat who fought in the Spanish Civil War -- which itself was all about socialism vs. socialism. Just recently I finished a book called "George Orwell: Essays" (Penguin Classics). Some decent thoughts mixed with -- you guessed it -- too much Social Democracy rhetoric/fiction.
I am perplexed, though, about the similarity you pretend exists between 1984 and my various haiku above. Can you explain?
------------
Orwell fought fascists
Also Stalin fought Hitler
Socialism sucks
Published: December 12, 2008 6:17 PM
Tomb Like Bomb
"I am perplexed, though, about the similarity you pretend exists between 1984 and my various haiku above. Can you explain?"
Just the three-line absurdities that are repeated throught the book, exaggerations of false socialist propaganda. You probably read Homage to Catalonia a year before it was published, but if not, you might be interested to know that the war was multi-sided. If all sides were socialist...if "socialism" is such a broad term...I have no choice but to consider the Austrian School as itself socialist, as it insists on uniformity in recognition and respect of the property claims, a uniformity that absent much of the other "socialist" ideology.
Published: December 12, 2008 7:18 PM
db0
There's socialism and there's socialismPublished: December 12, 2008 7:57 PM
newson
to tlb:
for all the ills of the batista regime, and there were plenty, the country's economic output pre-castro was on a par with that of japan. imagine how much worse things would be without the rivers of remittances that arrive from the cuban diaspora around the world. or the chavez solidarity funds.
there are far more whores in cuba now that ever was the case prior to the revolution, and i'm only talking about the hard-working ones in the bars and hotels, not the ones with the party card in the top pocket.
where's the success of the chavez regime over and above the oil bonanza, which he had the good fortune to enjoy? cost of living increases are rampant, murder's through the roof. i can't see the progress.
latin america is a sorry textbook example of populism. chile is the only latin american country that just may become a developed nation, and it's not a given.
Published: December 12, 2008 8:09 PM
Tomb Like Bomb
newson,
"Economic output", with an emphasis on "out". American mobsters did well under Batista, but I'm more concerned with the quality-of-life indices of the nation itself. But you do make a point with the solidarity funds. Venezuala, even taking such charities into account, beats its neighbors, including Chile, in a number of incices, including that most important one, public approval.
I wasn't aware "number of whores" was a generally-accepted measure. Cuba, whores and all, enjoys a more effective healthcare system than America, despite its being a traditionally much poorer country. Other Latin American countries, including Chile, don't come close.
The main progress in Venezuala is that individuals are beginning to have self-determination consitituting more than the occasional vote. In some districts, the citizens' councils outrank the governors (a situation that would be unheard of in the party-ruled American states, and of course pre-Chavez Venezuala). Not surprisingly, it is the Chavist governers, particularly those on the left-wing of Chavismo, who are most willing to defer to the citizens in the event of disagreement. Such decentralization is a requirement of Chavez' Bolivarian constitution, if you should read it.
Published: December 12, 2008 9:18 PM
newson
ha ha. the whores-in-bars index is likely to be as accurate as any numbers from the regime. the gangsters in today's cuba wear comical khaki greens and make rambling speeches.
michael moore should have left the piano bar and done some real reporting. births are only registered after one year. sicko!
Published: December 13, 2008 5:00 AM
rothbardian
i was so mad when i read that dumb "refutation" i had to stop and post a response. i share it here.
---------------------------
Just about everything written in this "refutation" of Hoppe is confused.
Present goods does not mean that you get paid before you do anything. What is being exchanged here are means to different ends, and logically ends are always more subjectively valuable than means. The worker's means and ends are the obverse of the capitalist’s means and ends. The worker is just selling his labor for a wage, because he needs more money now. The capitalist is essentially selling the wage for the labor because he needs more money later. You may disapprove of the amount paid for this or that labor but that does not change the facts of this economic relationship.
The worker could produce produce his own goods and sell them and keep the full market value of those goods for himself. Why does he not do so? He lacks capital. The capitalist, on the other hand, has capital. He has saved and can pay to wait and risk a higher return later. He pays the workers their salary regardless of whether he recoups his investment and interest. The worker benefits because he does not have to save and wait. The capitalist benefits only if he in fact gets a profit, which does not always happen. The fact that both parties work together show that they need each other. The fact that they need each other shows it is a mutually beneficial relationship, as opposed to a truly exploitative relationship where one party interferes with the rights of another.
I suppose it is “involuntary” in a sense that the worker lacks capital. But one cannot merely acquire capital by force of will. As you admit, he could save money and start his own business (and become an exploiting capitalist, according to you). Unless it is the result of prior violent redistribution of wealth, the capitalist has acquired his savings through previous market valuations. He either has his own capital saved or borrows the capital of others (in which case he, like the worker, is trading present goods for future goods).
Your example of your hypothetical human is just silly. If he seeks credit and gets it he is only illustrating this economic theory, not refuting it. He is seeking present goods by trading up future goods, and he needs someone who wants to provide present goods in exchange for future goods. And it seems that if this is the “only way he can survive” then it seems he is in fact better off by working with the capitalist.
But why doesn’t the capitalist just give the worker the full value of the product? Because then he would not be serving consumers efficiently, and his resources would be more effectively employed elsewhere. Both worker and capitalist are subservient to the consumer, who can bring a business to its knees if it fails to provide a good they want for the right price. It is just as wrong to say the worker is exploited because he can’t have his wage plus interest as it would be to reverse it and say the capitalist is exploited because he must pay for the labor before he gets his positive return.
Rather than a relationship of parasitism, capitalist and worker are working in the harmony of the market. The worker is not exploited by being denied something that is not his to begin with. No man has the right to force another to provide for him food, shelter, or a job. The capitalist buys the worker's labor by trading x price now in exchange for x+interest premium later. It is man helping man, for individual and collective improvement.
A lesser point, in a complex market economy the worker can become a capitalist quite easily himself through the stock market or any other investment, large or small.
You should brush up on your economics and Marxism. Peace.
Published: December 13, 2008 9:39 AM
db0
I must be doing something right then
Published: December 13, 2008 10:31 AM
Tomb Like Bomb
newson, if you can't accept the data from the locked-down "populisms", it's going to be tough to conduct a a meaningful comparitive analysis. It might be time to look at the more open European welfare states...or perhaps the simple fact that no country in history, certainly not the U.S., has ever freed itself from dependency without stong protectionism.
Published: December 13, 2008 3:39 PM
Joe Brochu
TLB,
Regarding "Misunderstanding communism", I don't see how need-based allocation can be proportionate to labor. Also, by "a hard day's work", I meant on a repeated basis. My point was that just because I'm doing my job doesn't guarantee that the goods I need (presumably produced by others) will be available when I need them. This means scarcity, which means that market forces exist whether or not they are allowed to be acted upon.
Of course, scarcity also plays a role in the available jobs, and I think this is an important point that is missed in MC. Everyone can't be a movie star, and someone has to clean the sewers. Does the sewer cleaner get a better car than the movie star as an incentive, or does the movie star have to clean the sewers every other thursday? (Either of these circumstances actually sounds like a good case for communism!)
Note - I only read the page that I linked to, but based on db0's comments on that page he doesn't seem interested in discussing scarcity.
My complaint with various modern and historic populist systems is that the failures can always be blamed on one corrupt leader or another, rather than on the infeasibility of the system itself. In my opinion, the fact alone that it's possible for a few people to pervert a system reveals an inherent instability in it.
This is why I like truly free markets - they are inherently adaptable and their natural complexity means that disruptive events in one sector can be isolated from other sectors. In fact, failures in a free market system are what strengthen the system as a whole, just as the survivors of a biological virus passively strengthen their species against future onslaughts.
I'm not enough of a historian to argue the finer points of each regime (I can't believe I forgot North Korea!), and I certainly won't argue that any of the preceding situations (typically, feudalism or dictatorship) were any better. What troubles me is that people in those countries and others should have learned from these examples.
The general pattern of "Leader appears, promises hope, displaces the tyrant, expects everyone to cooperate, ensures that everyone cooperates, runs out of money, clings to power, dies in infamy, successor really screws it up" seems to be prevalent (although not yet complete in all of these cases).
By the way, I also considered adding "America, four years from now" to my list. I'd say we're at "expects everyone to cooperate" right now, although "runs out of money" is approaching fast!
Published: December 14, 2008 7:48 AM
Joe Brochu
Apologies - another addendum -
I have worked as a contractor in both Brazil and China, among many other countries. While I'm not completely up to speed on current government policy in either country, I have taken back a few impressions of how policy is made:
In Sao Paulo, each car has a day of the week on its license plate, and on that day it is forbidden to drive into the city. This is intended to reduce traffic and encourage use of public transport.
So what is the result? Everyone owns a cheapo piece of crap car to drive on their primary car's day off. Many of these break down, causing even more traffic problems! This illustrates the common Austrian argument that interventionist policy often has unforeseen consequences.
In China, my client was concerned about placing a certain system in their office, even though this system is designed for desktop use. Instead, we are putting it in an equipment room where it will be unpleasant to use due to noise, HVAC, etc.
The reason for their concern is that locating it in the office could be seen as a bribe. This is regardless of the fact that this is included as part of a system that has already gone through a substantial bidding process (our sales agent advised that they make decisions based on the physical weight of each proposal).
The fact that such steps have to be taken to prevent corruption indicates that the system is highly susceptible to corruption. To me this means the system is unsustainable.
With any centrally planned system, it seems that constant revisionism is required to keep up with changing needs (market forces). Do we really expect the bozos running the show to always (or ever) get it right? Even if one leader is very good, who replaces him?
Leadership placement in a democracy is granted prior to the time a leader performs his job (fulfilling the demands of his electorate), whereas in a market system, this placement only comes as the result of a successful performance (having fulfilled demands more effectively than his competitors). Where would you put your money (assuming that you are aprioristically self-interested of course!)?
Take what you will from the above anecdotes - They may be irrelevant to this discussion, but I think they're at least good for a chuckle.
Published: December 14, 2008 9:11 AM
TRIWT
Let this stand as an eternal testament to the cult-like nature of Mises.org
Published: December 14, 2008 9:51 AM
Ramoosan
"The fact that such steps have to be taken to prevent corruption indicates that the system is highly susceptible to corruption. To me this means the system is unsustainable."
I take it then that you are anti-capitalist as well?
I mean really, that is illogical. All systems are susceptible to corruption. The fact that A can happen does not mean A is unavoidable or that the risk of A outweighs the rewards.
Published: December 14, 2008 1:17 PM
Vanmind
"...the cult-like nature of Mises.org"
After all the Dear Leader mass-murder campaigns of last century, I am amazed to see people still confused about dangerous cults. If the core Austrian advice to "never commit fraud against anyone" is some cult's siren song leading toward doom, no two people should ever converse because that way would always lead to the birth of another cult -- conversation itself would become a fraudulent act. Since socialism has been declared here again & again to be fraud, and since Austrianism has just been declared here in these comments to be one more variety of socialism (committing fraud by having the audacity to advise people not to commit fraud), then perhaps there should be no social activity at all, no human action that involves any kind of human interaction. Then, maybe, the collective "we" could finally perfect the precious protectionism that "we" pretend is necessary to eliminate the exploitation that apparently is inherent in the freedom to trade.
"There's socialism and there's socialism."
There is only freedom or socialism. There is no third way, no we're-smarter-now-so-it'll-work-this-time, no positivist model of any kind that can help anyone plan anything macroeconomic -- unless the plan is to destroy the ability for individual acting humans to trade and cooperate, unless the plan is to set up that proverbial environment of the omnipotent state in which everyone strives to live at the expense of everyone else by way of political connection and bureaucratic fealty (i.e. the way that the Bernenkes and Krugmans of the world try to plan).
"You probably read Homage to Catalonia a year before it was published."
As far as I can tell, that statement must stem from a false belief that 1984 was published in 1984. Can anyone read my post about Orwell and the response containing the statement above and reach a different conclusion?
All in all, I'm beginning to suspect that the blogger and the people here defending the blog are as confused about the original (i.e. true) definition of socialism as modern liberals are about the original (i.e. true) definition of liberalism. "Oh, no, no, socialism now means this other thing here, because that way I can pretend that socialism is benevolent" (not a direct quote from anyone). Perhaps tomorrow's worst National Socialists will be able to change the definition of holocaust to mean "complementary bubblegum and ice cream for everyone who gets on the train."
Published: December 14, 2008 1:50 PM
Reason
Joe Brochu,
Your foreign experiences are really interesting. Maybe you could develop these "anecdotes" in depth and submit them for pub.
Published: December 14, 2008 5:24 PM
Eric Hood
"db0
i was so mad when i read that dumb "refutation"
I must be doing something right then"
Given your stated refusal to learn anything about a subject you are "refuting" it seems to me you are more like a small boy tormenting a terrier through a fence and receiving a clip behind the ear by a passing adult as a result.
Published: December 14, 2008 8:53 PM
Andrew Slominski
We recently posted an article about individualism on our blog: http://riseuprochester.org/2008/12/01/why-individualism-is-better/
This caused a long dialog with db0 on our site and on his. I got turned off when he started resorting to calling people names on his site. Names like tw@t.
He referred me to some reading at marxists.org to learn more about the topic. Naive me, I thought the school of Marxism had advanced in recent years. Wrong. The introduction to Marxism included all of the junk articles I read in English class (that's right, not economics). The other articles are from great minds like Lenin and Mao.
Funny, last time I checked there were no Austrian Economists with tens of millions of murders on their hands (of their own citizens).
Published: December 14, 2008 10:21 PM
Eric Hood
In case you are still here db0. Here is a quote from a lecture by LvM in 1950.
In choosing between capitalism and socialism people are implicitly also choosing between all the social institutions which are the necessary accompaniment of each of these systems, its "superstructure" as Marx said. If control of production is shifted from the hands of entrepreneurs, daily anew elected by a plebiscite of the consumers, into the hands of the supreme commander of the "industrial armies" (Marx and Engels) or of the "armed workers" (Lenin), neither representative government nor any civil liberties can survive. Wall Street, against which the self-styled idealists are battling, is merely a symbol. But the walls of the Soviet prisons within which all dissenters disappear forever are a hard fact.
I hope this helps.
Published: December 15, 2008 3:12 AM
db0
Yeah, well, I'm not for prisons either. Any "supreme commander" would not be equal to the rest of the people and thus against the concept of egalitarianism. So he would not exist in the system I'm striving for.
Published: December 15, 2008 3:27 AM
Eric Hood
Prisons are not inherently evil, they exist to maintain the status quo, for example people are imprisoned for different reasons in the United States than China.
As to egalitarianism every one of us has different skills, abilities and temperament. We are not all equal, also at the end of the day someone has to make a decision. People are all too ready to "let George do it"
Any attempt to legislate or mandate uniformity will fail.
Classical Liberalism with its minimal government interference gives greater freedoms with all people being equal under law.
Increasing the per capita output of goods and services is the only way to improve the lot of the people. Socialism or communism is no better than serfdom and we have moved a long way from that.
Another LvM quote for you, this from Liberalism.
2. Private Property and Its Critics
Man's life is not a state of unalloyed happiness. The earth is no paradise.
Although this is not the fault of social institutions, people are wont to hold them
responsible for it. The foundation of any and every civilization, including our own,
is private ownership of the means of production. Whoever wishes to criticize
modern civilization, therefore, begins with private property. It is blamed for
everything that does not please the critic, especially those evils that have their origin
in the fact that private property has been hampered and restrained in various respects
so that its full social potentialities cannot be realized.
The usual procedure adopted by the critic is to imagine how wonderful everything
would be if only he had his own way. In his dreams he eliminates every will
opposed to his own by raising himself, or someone whose will coincides exactly
with his, to the position of absolute master of the world.
Everyone who preaches the right of the stronger considers himself as the stronger. He who espouses the
institution of slavery never stops to reflect that he himself could be a slave. He who
demands restrictions on the liberty of conscience demands it in regard to others, and
not for himself. He who advocates an oligarchic form of government always
includes himself in the oligarchy, and he who goes into ecstasies at the thought of
enlightened despotism or dictatorship is immodest enough to allot to himself, in his
daydreams, the role of the enlightened despot or dictator, or, at least, to expect that
he himself will become the despot over the despot or the dictator over the dictator.
Just as no one desires to see himself in the position of the weaker, of the oppressed,
of the overpowered, of the negatively privileged, of the subject without rights; so,
under socialism, no one desires himself otherwise than in the role of the general
director or the mentor of the general director. In the dream and wish fantasies of
socialism there is no other life that would be worth living.
Published: December 15, 2008 4:25 AM
db0
Egalitarianims =/= UniformityThis seems to be a classic error that libertarians (purposefully?) make
Published: December 15, 2008 5:27 AM
Eric Hood
Egalitarianism does indeed equal uniformity when combined with socialism/communism comrade.
Classical Liberals are interested in legal egalitarianism.
Socialists and communists are interested in economic egalitarianism.
Two totally different things.
Published: December 15, 2008 5:45 AM
db0
Please don't call me "comrade". It slaughters the word and sends a chill up my spine...
No, egalitarianism does not equal uniformity when combined with Communism, however much you'd like it to be so that you can have an easy target. All you have is a strawman.
There can be no egalitarianism without economic egalitarianism.
Published: December 15, 2008 8:57 AM
Andrew Slominski
I find it amusing that you take offense to being called a "comrade," db0.
I understand that you took it to be patronizing, but what should be offensive about a term of equality to a self-labeled "left leaning libertarian" who's quite fond of Marx, Lenin and Mao.
If you'd like to distance yourself from mass-murderers like Lenin and Mao then you shouldn't send people to http://marxists.org/ to get educated about Marxism.
comrade |ˈkämˌrad; ˈkämrəd|
noun
a companion who shares one's activities or is a fellow member of an organization.
• (also comrade-in-arms) a fellow soldier or serviceman.
• a fellow socialist or communist (often as a form of address) : [as title ] Comrade Lenin.
Published: December 15, 2008 10:36 AM
db0
And then you wonder why I called you a twat.
Published: December 15, 2008 12:17 PM
Tomb Like Bomb
Joe,
The labor credit is incentivisation, by which "to each according to his need" is modified "to each according to his labor". I say modified, not supplanted: there is a tendency of distribution according to need inherent in an equal distribution, which is what the labor credit achieves in the typical event of approximate equality in labor credits. By contrast, markets, where one actor's labor has been as valuable as another's, will distribute the yield according to a fairly illegitimate, pre-existing wealth distribution of sharp inequality.
The "repeated basis" of the "hard day's work" is meaningful only on the assumption that others' workdays will be something other than repeated. If they're something less, then you would be entitled to something more, but again it would be finite.
There is potential for shortfalls in any economy, especially economies without antecedent planning.
Darwin himself rejected the Social Darwinist argument. Kropotkin, as a young Darwinist, set out to find competition in the natural world and found the opposite. Notice that if you make your "biological virus" even stronger, thus presumably "strengthening the species" even more, you'll be left with only a single survivor, with whom the superlatively "strong" species will surely die. Another species, not so concerned with its "strength" as to engage in self-destruction, will come to dominate.
Published: December 15, 2008 3:11 PM
Joe Brochu
TLB,
First of all, thank you for sticking to cogent arguments. You have obviously put in some time to study these subjects and I hope that others can appreciate this and follow your example.
Can you recommend any websites or readings that explain some of the current leading socialist/communist theory? I am particularly interested in the functional/logistical side of the theory - how does it work, what measures are needed to implement and sustain it, can it be derived from basic principles about how people interact. I probably won't agree with these, but I am curious to learn more. Then I can go raise some hell on their blog!
I'm not familiar with labor credits, but based on your description I would guess that it means a fixed price is posted for each job that needs to be done, and this price is determined by the necessity of the job as well as the willingness (or unwillingness) of workers to do it. I imagine that this loosely corresponds to my "the sewer cleaner gets a better car" scenario.
I think Austrians would see this as an unnecessary and inefficient manipulation of market forces. How is necessity determined? A daily vote? Representative government? And how much does a representative get paid?
This brings up Mises' calculation problem, which is still valid in the age of computers. While we now have the ability to solve numerous multiple equations simultaneously, the problem lies in determining all of the inputs. How do you know what every individual wants or needs at a given point in time, and will those needs still be valid by the time you can react? Econometric analysis relies on past transactions and has to make assumptions even to describe present demand.
In stating that a free market is not susceptible to corruption, I mean that the corrupt actions of one or a few individuals can't pervert the whole system. There is certainly still room for an individual to abuse a position of power - but his power and therefore abuse is necessarily limited to whatever industry he has succeeded in. The rest of the world will chug merrily along, and will quickly find substitutes for whatever product gives him this power.
If someone manages to monopolize or cartelize a necessary commodity such as water or energy and intends to enslave the human race at all costs, they might have a shot. However, they would face an uphill battle, requiring massive expenses to protect their means of production from even grassroots opposition.
In a populist system, the leader already has the monopoly along with an army and fiat currency to pay them. All he needs is a reason.
When the industry is the entire economy as in a socialized state, a corrupt action or even a poorly thought-out decision at the top can have unrecoverable consequences across the board.
The Austrian view of the current financial crisis would be an example of this. Decentralized banking in general means that the failure of one or a few banks doesn't disrupt the whole monetary system. Instead, allowing banks to fail clears the playing field for the banks who have kept more prudent policies to gain more market share. Some people may lose their money in a bank run, but they will be all the more cautious when choosing their next bank.
Regarding the biological virus, the strength of the virus isn't proportionate to the benefits (in a relative sense) gained by the surviving species - they have only gained immunity to that particular strain, regardless of how many died. In an apocalyptic case where too few of a species survive to further propagate their genes, other species will fill the ecological gap left behind. Neither species has played a conscious, active role in this transition, and only humans would even comprehend that it was happening at all.
If I haven't lost track of my original vague analogy, this corresponds to new entrepreneurs finding ways to fulfill whatever demand the corruptor has denied. In addition, my arguments here regarding the importance of decentralization as an insulating factor should suggest that such an event would be highly unlikely in a free market.
The cooperation seen in ecological systems is the result of the fact that the battles have already been fought and won, and demands are relatively constant. Take any ecological system, introduce a few bunny rabbits, and watch what happens. The demands of conscious humans are in constant flux, which prevents a similar universal cooperation from occurring naturally.
I won't argue against cooperation - voluntary cooperation can be a powerful force, and can open new avenues for competition. I am a big fan of open-source software and even contribute to a few projects. I recommend the book "Wikinomics" for an interesting look at how some companies are voluntarily choosing to work in more collaborative ways, and mutually benefitting everyone involved.
However, the benefits of voluntary cooperation should not be used to justify coerced cooperation - otherwise I think we will see a lot less voluntary cooperation.
A free market system can benefit everyone without requiring everybody to be nice. I don't like Wal-mart, but it has raised the standard of living for a lot of people by putting more goods within their reach. Megastores like Carrefour are playing a similar role for the "exploited" workers who make Wal-mart's products.
Monetary inflation works against this beneficial force by sustaining higher prices, and prices play an equal role to wages in wealth creation. So who is really to blame for keeping the workers down? If you were to levy a "Megastore tax" (or "windfall profits" tax) to promote smaller, local markets, who would really be paying it? Hint: How many billionaires do you know who shop at Wal-Mart?
Is today's wealth disparity too much of a price to pay if it means that everyone benefits over the long term? If you allow the envied wealth of the top few to exist and focus instead on the factors that can create wealth production for the masses as a goal, what kind of system will facilitate this most effectively?
Whew... my head hurts. Although that could have something to do with the tile sealant fumes emanating from my bathroom...
Published: December 16, 2008 1:26 AM
Andrew Slominski
db0: So you called me that for believing you were fond of Marx, Lenin and Mao? You sent me to http://marxists.org as a resource to learn more about your beliefs.
I would never point you to Lincoln as a model for defending personal liberty nor would I send you to a president like Bush or FDR as a defender of economic liberty. I would rightly be offended if you claimed I supported their views, but I certainly wouldn't resort to name calling. Especially if I had suggested reading them as an explanation of my own beliefs.
So here's the deal. If Marx, Lenin and Mao don't represent the "left-leaning libertarian" ideal, then who does? If you give me some links and resources I'll gladly go there and read them.
Published: December 16, 2008 12:29 PM
db0
Start with Noam Chomsky
Published: December 16, 2008 1:00 PM
Andrew Slominski
Oh, a guy that is against private property and profit for others but not for himself? I suppose his $2,000,000 net worth is deserved because his principles are fine. So he can talk the talk but can't walk the walk...
The Hoover Institution has accused him of being a closet capitalist and I guess I'd have to agree:
http://www.hoover.org/publications/digest/2912626.html
Published: December 16, 2008 2:12 PM
Tomb Like Bomb
Joe,
I've mentioned Albert, whose website zmag.org has a Parecon forum. But more to the point of the calculation problem is www3.sympatico.ca/bernard.leask/renewal.html.
The labor-credits paid by the job could be determined by the labor-credits dedicated to it by the society in their capacity as consumers. Price of the product would be determined similarly, thus resulting in a convergence of production and consumption, as the (literally) shitty jobs you mention pay in inverse proportion to their natural attractiveness and in direct proportion to demand for their products. In complex industries, the wage might better be allocated to the industry itself, and its exact distribution be determined democratically by the workers' themselves (each under the understanding that as the more valuable workers become unhappy with their level of pay, they might switch industries, potentially weakening the quality/quantity of the product, thus ultimately reducing the collective wage of the industry, hence their own). That's one model, still overly-incentivised, but without the distortion of arbitrary initial distribution.
The flip-side to the economic calculation problem is the problem of uncertainty and the problem of initial distribution. Does the rationality supposed inherent in free markets outweigh the self-reproducing irrationality of an initial distribution based on chance, or worse, dispossession? Does the supposed rationality of unplanned allocation outweigh the waste that results from the uncertainty?
You're assuming an undemocratic state is necessary for socialism. I might at least as well assume an undemocratic state is necessary for capitalism. I doubt you condemn capitalism for the many un-Austrian actions of the U.S. government. You may call them " state socialistic" actions; similarly, I agree with Lenin and Trotsky's assessment of the Soviet Union as "state capitalism". In America, the rich control the army indirectly through their state executive. In ideal capitalism, anarcho-capitalism, their control over the army would be direct. They would of course face competing private armies, but only inasmuch as modern states face competing state armies.
The flaw in your decentralization logic is the assumption that there will be an equal number of failures in each system. In addition to the obvious (that more banks means more opportunities for failure), a central bank wouldn't be as likely to fail as a small bank, because it wouldn't need to take the kinds of risks the small banks would in order to stay competitive and get to the long run. And I'd be much more comfortable with what was left if all but one of an initial two banks failed, than if all but one of an initial ten did.
I'm not against entrepeneurs, although it seems logical to me that their flip-side (Veblen's saboteurs) would account for an equal number of the upwardly mobile in a free market.
Kropotkin's study of mutual aid focused primarily on humans, in fact. Anyway, species less conscious than humans (or apes) can be more competitive. Crocodiles, for example, simply lack a cooperative instinct. Nor do I feel that humans' needs are constantly changing. As you can see easily in the starving populations, human needs stay about the same. Bourgeois "needs" may vary, but that should be expected at the level where needs must be invented.
The absence of "voluntary" cooperation, in the presence of "coercive" cooperation, will logically be meaningless. It's interesting you use the example of intellectual property, which is unique. Other forms of property, including those basic needs prerequiste for intellectual activity, is scarce and has itself been obtained through coersion. When a sharecropper is taxed by the plantation-owner, that is a free market; but when the government, which doesn't have the arrogance (or sense) to call itself "owner" of the land (which it has no less a claim to) taxes the plantation-owner, that is called "extortion", "robbery", and all the rest. I'm not so concerned with cooperation vs. competition as I am who owns what. Two duopolists could be perfectly cooperative; it won't make it socialism. First we should correct the false perception of them as having negative authority over others as regards that which they call their property. If beyond that, people wished to come to a consensual agreement as regards what is properly the property of no one, and that agreement were functionally the same as capitalism but that it were only temporary (new generations had also to consent), only then would you have voluntary property.
Published: December 16, 2008 4:21 PM
db0
Ad homined. Try again.
Published: December 17, 2008 5:35 AM
Tomb Like Bomb
I don't think anyone here has ever refused to read a Mises publication on the basis of his working for the Austrofascist regime ("It's not fascism when Austria does it.") The Hoover article cited no sources, not that it matters, given that even if all information were correct and all quotes provided sufficient context, Chomsky's essential point stands: money equals influence in a capitalist economy. I know many of you voted for Bob Barr (or one of the others) even though you may reject the system of mixed government by which the people may elect such a powerful position. You did so presumably upon facing the reality that abstinence is a waste of potential influence, influence that may be useful for the dismantling of that evil basis for influence.
Chomsky is the first to admit that his altruism has decreased with age, and that family has gained ground over humanity in his considerations; all of this a scientifically-correct conception of the brain predicts. "Do As I Say (Not As I Do)", understood correctly as "Hear My Arguments and Make Up Your Own Mind" has of course been a constant theme throughout his work. I would be far more suspicious of one's philosophy if it forgave one's behavior, for obvious reasons.
Published: December 17, 2008 11:25 AM
Reason
TLB,
Lew Rockwell, president of this institution, puts Chomsky's work, as well as articles from many other minds with whom he has many disagreements, on his popular independent site, lewrockwell.com.
Published: December 17, 2008 1:18 PM
Joe Brochu
TLB,
This is going to be my last post here, because at this point I think I've written more about Austrian economics than I've actually read!
Thanks for the links, I've looked into them a bit and intend to look into some of those ideas a bit further.
I think that a system like Parecon could work as a business model or framework, but the application of it to a whole economy would require some form of a centralized state. The examples that I found (on Wikipedia) appear to be businesses that would attract people who are sympathetic to the political causes involved. How would you get the Austrians to participate?
I don't quite buy the notion that a centrally planned system removes uncertainty. Even if such calculations only incorporated necessities such as food and shelter, the Bourgeois needs are still in competition for the same scarce resources and would have an effect. You could reduce uncertainty by limiting the variety of available goods, but this pretty much goes against everything we're trying to accomplish here. The goal is to maximize choice for everyone, right?
I also take a less rosy view of electoral democracy. It removes some of the advantages of division of labor by expecting everyone to be capable of making a decision on everything. This in itself introduces a significant amount of inefficiency - decisions can take a long time, and if only one option is explored and fails, the process must start over (or the failure must be propped up to justify the system!).
I think you'll agree that very few of the democratically elected representatives in the world have any clue about the factors and consequences involved in the decisions they make daily. The electorate who put them there is even more ill-informed and apathetic. If a popular vote came up between a free plasma TV for everyone and modernizing the electricity grid, which would win? Democracies don't think long-term - investors do.
I intend to do some more reading, and at some point will write a post on my blog outlining my thoughts on an anarcho-whatever system. I think this would start by focusing on what "would" happen, and might go into what else "could" happen. I think that any system requiring use of the word "should" will be expensive to implement and sustain (requiring education and/or enforcement), but this doesn't rule them out completely. Note that this applies to Austrian ideas such as Rothbard's non-agression axiom just as much as it does to socialist ones.
One key point of contention is obviously property rights. In the absence of a coercive state, I think property rights will be determined simply by "If you can protect it, it's yours." This protection could be in the form of a fence, a private security force, or voluntary consent to a legal system by which you can agree with others on the definition of property rights. It might turn out that the latter is the easiest and most effective option for most people, and conflicting legal systems could possibly coexist in the same geographical areas.
I think the economic superstructure of an anarchic world would be the free market, due to its propensity to arise naturally. However, communal systems such as Parecon could be established, and if they can prove to be more effective at meeting demand, they could catch on and spread. They might face an uphill battle since they would be in competition with other private enterprises, but they might also attract better workers and loyal customers.
As to how a peaceful anarchy could be established, I think it would require a peaceful transition by gradually offering people better non-governmental options than those provided by the existing governments. I'm not sure how feasible this would be - obviously the guys with guns will always have a strong say. But if alternative voluntary legal systems could be established and attract enough people, then pressure for an "opt-out" option might emerge.
I don't think any transition involving violence could result in a system that won't quickly devolve back in to a militarized state. I see this as almost self-evident. I also don't think that any current governments could be changed from within - they carry too much historical baggage, and have vested interests in preserving their current form.
The current governments might still play a role in an anarchic world. They'd make great mall security guards.
Thanks for the discussion!
Published: December 17, 2008 7:45 PM
Tomb Like Bomb
Joe,
Good talking to you. Last post:
No one would be forced to contribute to participatory planning (PP), but they certainly wouldn't be allowed to force others to respect their authority regarding the world external. There's no way to avoid coercion here. Either the Austrians (I assume you mean those who own property) are coercing society (its individuals) or society (its individuals) is coercing them. Neither of us are anarchists; neither of us believe in the abolition of all property, private and collective.
Most changes in demand within the year (the length of the Parecon planning cycle) is the result of capitalist dynamism and the resulting instability in prices and wages, which PP would abolish. In PP, all of the dynamism would occur safely during planning, before resources were committed. Natural short-term changes in demand, on the other hand, if substantial (doubtful), might beg for a shorter planning cycle for appropriate industries (I'm thinking of Keynes' business cycles). The market itself, though, is limited in its ability to respond quickly to these changes anyway: it receives information only at the speed of actual consumption and price change, and much is wasted before the latter is stabilized. Nor does the market consider that short-term changes in spending habits might be a symptom of nothing, and might in fact be entirely consistent with the individuals' yearly plans, which they of course have no knowledge of and no guaruntee they'd be adhered to anyway.
Published: December 17, 2008 9:30 PM
Joe Brochu
A point of clarification - I use the term "anarchic" to refer only to the absence of a coercive government - I certainly don't think that a purely anarchistic world could be stable in any circumstance.
Since this post, I have read a bit about "Panarchism" and I think this is probably more along the lines of what I was thinking - governments can exist, but citizenship is voluntary (thus they are in competition with each other for citizens/customers), and they are not determined by geographic boundaries (to allow greater competition).
In a system like this there would be plenty of room for all kinds of systems - and each consumer would decide which one works best for him.
Published: January 2, 2009 7:31 AM