Comments (69)

• Mark Ennis

  That last paragraph is exactly why statists get their way. Want poor people to make more money? Raise the minimum wage. Want something to be cheaper? Cap the price by legislation. Their answer is always a straight line and the consequences be damned.

  Incidentally, this also insulates them from criticism as well. Criticism and analysis of statist ideas also requires something to pay attention past stage one and they're not typically interested doing that either.

  Published: May 24, 2009 1:19 PM

• AJ Witoslawski

  I don't think people instinctively embrace protectionism, as long as you phrase the question correctly.

  For example, instead of using statist terms for the minimum wage by saying that it forces businessmen to raise wages, you want to use the libertarian terms by saying that the minimum wage prevents people from working below a certain wage. The same goes for protectionism: instead of using statist terms and saying it "protects" exporters, point out that it harms importers, including that hair stylist who now earns less profits, cannot hire as many workers, cannot spend as much on other products, and cannot save as much because of higher cost American products.

  Published: May 24, 2009 1:33 PM

• Mac

  Right on Jeffrey... sigh.

  I wonder if the multi-step thinking could somehow be transformed into one word brand or description. Marketers do this well. For example, they can sell "fat-free lard" even though its an oxymoron, not even lard, and folks seem fine with it.

  I chuckle at my own thought. Imagine thinking transformed into marketing messages so everyone "knows" the answer, or knows what needs to be done, or at least knows where to start, and, maybe, even feel good about it. But, isn't that what the statists do?

  Cheers

  Published: May 24, 2009 1:40 PM

• Ben Ranson

  I do not believe that the persistence of fallacious economic arguments is due to the common man's inability to understand chains of deductive reasoning. The common man is able to use computers, build houses, solve Sudoku puzzles, perform auto repairs and do basic math. These tasks require chains of deductive reasoning.

  Economic fallacies are popular among successful businessmen, college professors and scientists. These people can understand chains of deductive reasoning.

  As a college student, I took Introductory Micro-economics. The course was held in a large auditorium, and attended by several hundred students. The lecturer presented many fallacious and contradictory economic ideas. At the time, I was not able to see the errors in his reasoning. As far as I am aware, the other students also were unable to see that we were being taught nonsense.

  Several years later, I read Hayek's Road to Serfdom, which led me to this website through which I discovered Mises and Rothbard. As I came to understand economics, I rejected the pseudo-economic ideas I had held previously.

  Everyone that I know holds economic beliefs that are best described as socialist or fascist. I attribute this to the extensive indoctrination which we experienced in the public school system.

  I realize now that I spent many thousands of hours in classes that were little more than propaganda. Social Studies, Civics and high-school American History are examples. I recited the Pledge of Allegiance and sang nationalistic songs daily for years. I was surrounded by flags, pictures of the presidents and socialist art and literature.

  I do not know why I was able to follow chains of deductive reasoning and reject fallacious economic teachings while my classmates were not.

  Published: May 24, 2009 2:52 PM

• Greg

  The next step is the provision of "aid" to the poor nations who just can't seem to get out of their economic stagnation. Through no fault of ours, of course.

  Published: May 24, 2009 2:54 PM

• Michael Wiebe

  Paul Rubin wrote a paper on "Folk Economics" that gives a good evolutionary explanation of why people cling to naive, short-sighted economics.

  Here's the abstract:

  "Folk economics is the intuitive economics of untrained persons. It is concerned with distribution, and does not allow for or understand incentives. Folk economic notions evolved in our ancestors in circumstances where there was little in the way of specialization, division of labor, capital investment, or economic growth. It can explain the beliefs of naive individuals regarding matters such as international trade, labor economics, law and economics, and industrial organization. It is important that voters understand economic principles. Economists would do a better job of persuading others and of teaching if we paid explicit attention to folk economics. Because untrained individuals do not fully understand gains from trade, training in economics is likely to improve welfare by increasing the number of trading opportunities. There is evidence that this is in fact true."

  Published: May 24, 2009 6:07 PM

• Mexpat

  I live in Mexico, so I know what to say to the barber. Most of the things we buy here in Mexico come from the United States, and if Americans stop buying Mexican products, then the Mexicans will not be willing or able to buy American products. The Mexican economy is in a deep Depression because we depend on selling goods to individual Americans, who are saving their money and refusing to incur more debt to buy goods from anyone, while the U.S. government incurs more debt.

  The U.S. should be called the Schizophrenic Country, since the voters ratify a government that behaves opposite to individual citizens. The central government directs the economy and attends to the most difficult and even impossible fantasies of the docile citizens, such as printing money to create a booming economy that never ends with a bust, and blessing drugs that promise to cure diseases and old age without risky side effects. On average, these bureaucratic “experts” controlling the citizenry are paid $75,000 annually, while the typical American earns $40,000. Few Americans believe government employees are overpaid (other than politicians), so revolutionary change, though needed, is unlikely until the servicing expenses of the national debt become larger and the Depression deepens.

  Published: May 24, 2009 6:28 PM

• Magnus

  I agree with Mr. Ranson -- for the last 150 years, America has experienced a massive campaign of all-statist-all-the-time propaganda implemented via forced schooling.

  Everything about the way forced schooling is designed (from the use of bells to condition you to work on command, to the use of state-approved textbooks and the virtual elimination of primary texts) serves one purpose -- to instill a reflexive obedience to the State.

  Reason, or one's capacity for multi-step reasoning, has little or nothing to do with the popular acceptance of protectionism, market manipulations, etc.

  It has everything to do with fear, instilled in people starting in early childhood. Fear of the unknown. Fear of life without the State's omnipresent, benevolent guidance and sustenance.

  For people subjected to this psychological conditioning, the State is the ultimate super-hero. It's capable of anything. It isn't perfect, but it exists to rescue us mere mortals.

  People believe these things, and then go looking for plausible explanations to justify these beliefs.

  Published: May 24, 2009 8:34 PM

• Jeremy

  Mexpat - That's an excellent explanation. What's so hard to understand that when the barber spends dollars, they eventually must be spent in the American economy, no matter where they are first spent? (or if they are held indefinitely as cash outside of America, that a free gift in the form of lower prices than otherwise has been given to American consumers?)

  Published: May 24, 2009 9:30 PM

• Lyle

  Isn't central planning of the economy just an institutionalization of the free market principle: "survival of the fittest"? I suppose it depends on how you define "fit": 1. Efficient or 2. Powerful.

  A truly free market is void of any justice except what the individual can secure for himself against his assailant. And what if the victim is weaker than his assailant? Isn't the victim in a free market continually prevailed upon with fraud, theft, and injury? What is the difference of a free market, void a justice system, and socialist government? Isn't some intervention needed to secure justice?

  Is it just to eradicate protectionism that prevents the American laborer from competing against a foreign wage that is artificially lower than the real wage?

  Is it just to eradicate protectionism that prevents American industry from competing against a foreign price that is artificially lower than the real price?

  Published: May 24, 2009 10:32 PM

• Zombiehero

  Ranson and Magnus-

  You'd probably like this article by Walter Williams about academic inflation.
  http://townhall.com/columnists/WalterEWilliams/2009/05/06/fraud_in_academia
  "Employers report that many college graduates lack the basic skills of critical thinking, writing and problem-solving."

  I particularly think the problem with schools is that it's the one of the only industry where failure is rewarded with ever increasing funds. The marriage between the teachers unions and politicians is horrifying, and fascistic. The incentive is for teachers to not teach, then beg for more money because the teacher can't teach with what they are paid. The Unions and Administration all take their cut from the top, leaving almost nothing...creating and endless cycle.

  Classic example is DC schools....$25,000 per year per student....which is what the elite private school might charge...and we all know which one give the better education.

  This is a good article at Cato where I get some of my numbers....
  http://www.cato-at-liberty.org/2008/04/07/the-real-cost-of-public-schools/

  Published: May 24, 2009 11:20 PM

• Lael

  I think the hair lady understands economics better than most Austrian economists. Her problem isn't her ignorance but her ethics or sense for justice.

  You see, she understands that the American producer is being taxed to subsidize the Mexican price. Buying American is her way of restoring justice that the American justice system or Congress has failed to remedy. To illustrate, I will use an example:

  The Mexican product is priced at $5 after subsidization while the American product is priced at $10 after taxation. To spur economic growth in Mexico, the $2.50 in taxation from the American producer is used to subsidize the price of the Mexican product.

  Since the American government refuses to rescind the costs of taxation and/or regulation on American products, the hair lady, compelled by her ethics, buys American. It is her way of restoring justice to an unjust system that creates advantage for the Mexican producer through government intervention.

  I am continually astounded by the lack of ethics on the Mises.org website. Attacking a women willing to pay more to keep the victim of government intervention employed. If her logic is faulty for any reason, it is her belief that ethics is rewarded in this life. No doubt she will go out of business for choosing the taxed price over the subsidized one. I think the Austrian economist has learned that having a conscience doesn't profit. Human Action isn't a study of ethics but of profits and how the weak should be preyed upon by the strong.

  Certainly there must be consequences for buy a subsidized price over a taxed price? Once the taxed price is goes out of business, the subsidized price will return to the real price. Americans will be without jobs and unable to pay the real price. In the end, whether the hair lady buys American or not, she is out of work. It is merely a matter of time, sooner or later.

  Published: May 24, 2009 11:27 PM

• Gabriel

  From my experience of talking to various individuals, it appears that a person's views in economics is usually tied into their views concerning human nature. Individuals who are optimistic in believing that humans find ways to cooperate to fulfill mutual self-interests tend to be much more free-market oriented. Individuals who do not believe in this tend not to believe in the free-market, but will believe in a system that will correct the problems of the free-market. So, in my view, a lot of these issues comes down to whether a person has conflict view of society or a cooperation view of society.

  Also, in the way that economics is presented to the public, it is much more a matter of opinion or a political art. In this way, there are no fixed laws in economics so virtually every opinion concerning economic matters are treated as equally valid.

  With the woman in the article, I believe that she is probably basing her decision not on pure economic reasoning but on her sense of morality and justice, but at the same time, I believe that most people do not construct their economic views based on purely economic reasons. Whether or not she believes that buying American products that are overvalued corrects the wrong of buying American subsidized Mexican products makes economic sense is irrelevant; if she believes that it is the morally right to buy American, then she will continue to do so.

  The issue that most people have with free market economics is not necessarily the economic reasoning, but it's much more based on the ethics behind it. At times, Austrian economics is presented in a way that causes people to feel as if a person has to choose between economic prosperity and personal morality. Some people would prefer a moral, poorer society over a unethical, richer society. Whether or not this assertion is valid is debatable, but until Austrian economists find a way to demonstrate to the public that free markets are morally right and not just economic efficient, then people will not believe in it, no matter how logical the system is.

  Published: May 25, 2009 12:29 AM

• Gil

  Is this article criticising outright government protectionism - people are being forbidden by government from trading with other people they actually want to voluntarily trade with? Or what is deemed 'stupid voluntary trade' - people are buying local and paying a premium because they think they're getting a better deal because it's 'local', 'organic', 'fair', etc., but the are no particularly laws per se by the government forcing them to buy local? I'm pretty sure elsewhere people who refuse to trade with others they feel has dodgy tactics would be praised as 'voting with their feet' and 'sending a message that they want to trade with those who use honest means'. So which one is it?

  Published: May 25, 2009 12:33 AM

• Niko

  @Lael:
  "The Mexican product is priced at $5 after subsidization while the American product is priced at $10 after taxation. To spur economic growth in Mexico, the $2.50 in taxation from the American producer is used to subsidize the price of the Mexican product."

  Can you elaborate how the American government subsidizes the Mexican product with the 2.5$? I fail to see the mechanism. Also, why not profit from a lower price?

  "Human Action isn't a study of ethics but of profits and how the weak should be preyed upon by the strong."
  I've just finished reading it, and I haven't seen that in it. It generally says that every man is free and is master of at least his own skills and that profits are rewards for providing something useful to the customer.

  "Certainly there must be consequences for buy a subsidized price over a taxed price? Once the taxed price is goes out of business, the subsidized price will return to the real price. Americans will be without jobs and unable to pay the real price. In the end, whether the hair lady buys American or not, she is out of work. It is merely a matter of time, sooner or later."

  What kind of merchant wants to destroy his costumers? The whole point of selling things is having a market for them that wants and is able to pay (payment isn't money, money are a medium of exchange, not of payment). Bankrupting your own customers is illogical. It is very hard for me to follow your way of thinking unless a use the famous scream "the Chinese did it! They work for pennies and they take our jobs!", which I also don't understand.

  Published: May 25, 2009 12:48 AM

• FTG

  Lyle,
  Isn't central planning of the economy just an institutionalization of the free market principle: "survival of the fittest"?

  That's not a free market principle, which means your question is loaded, i.e. fallacious to begin with.

  
  A truly free market is void of any justice except what the individual can secure for himself against his assailant.

  Free market is the term given to the network of the myriads of voluntary human interactions, not involuntary. To include coercion as part of the free market (when coercion is contrary to freedom) and then conclude that "free markets are void of justice" is a classic example of Begging the Question.

  
  And what if the victim is weaker than his assailant? Isn't the victim in a free market continually prevailed upon with fraud, theft, and injury?

  So would any person even in a market that is not free. Coercion and fraud exist because bad or immoral people exist, not because of free markets.

  
  What is the difference of a free market, void a justice system, and socialist government?

  The difference being that the assailant in a socialist government will be the government, as its strength will be second to none. Instead, devoid of justice systems (if that were the case), the weaker person could still contract services for protection or collection of debts.

  Is it just to eradicate protectionism that prevents the American laborer from competing against a foreign wage that is artificially lower than the real wage?

  You assume that the protectionist scheme has some higher moral virtue in order to question the morality of questioning it or wanting to eliminate it. This is called Circular Thinking.

  Protectionist schemes represent an undue advantage, imposed by coercion, given to a specific industry, normally one with enough political pull or clout. The morality of protectionist schemes has to be analyzed by not just looking at how it benefits the few in the industry but how it affects others. The way protectionist schemes work is through limiting people's purchasing choices by taxes, tariffs or downright prohibitions. These cannot come as anything else but direct, overt violations over people's freedoms, which will be invariably immoral (due to their coercive, non voluntary nature). You cannot thus question the morality of the criticism against a protectionist scheme since the very nature of the scheme IS immoral in its conception.

  Published: May 25, 2009 2:40 AM

• FTG

  You see, she understands that the American producer is being taxed to subsidize the Mexican price.

  That cannot be inferred from the story above. You must be making this up. Where is your evidence that Mexican products are being subsidized?

  
  Certainly there must be consequences for buy a subsidized price over a taxed price? Once the taxed price is goes out of business, the subsidized price will return to the real price.

  Are you talking about "dumping"? Because if you are, the thinking behind "dumping" is clearly nonsensical. A business that follows such policy would only defeat its own purpose of providing the greatest possible value to its shareholders. Also, a company that sells at price A cannot simply raise its prices at B in order to recoup its losses without risking losing its market share by competitors that can undercut their price. The idea has been severely debunked by economists in this website and in many journals.

  
  Americans will be without jobs and unable to pay the real price. In the end, whether the hair lady buys American or not, she is out of work. It is merely a matter of time, sooner or later.

  There is more reason to believe she would be out of a trade if she keeps buying more expensive products out of a sense of false patriotism, since she would be reducing her profit margins. Profits allow a company to grow and to offer better products or services. The owner of the salon can hire more hairdressers by keeping more of her money by buying the cheaper products. A company with fewer profits or that barely breaks even will not have the wherewithal to invest in more capital goods or hiring more people, eventually losing market share and future, higher revenues. Buying more expensive products for the sake of feeling good only defeats the purpose of having a business in the first place.

  Published: May 25, 2009 3:04 AM

• Inquisitor

  "Isn't central planning of the economy just an institutionalization of the free market principle: "survival of the fittest"? I suppose it depends on how you define "fit": 1. Efficient or 2. Powerful."

  No, it's an institutionalisation of the principle that a) a bunch of idiots who claim a monopoly over the provision over certain services know better than infinitely more agents on the market and b) might makes right. Markets are predicated on voluntary exchanges and fitness enters in as in productive capacity, i.e. ability to provide value. So no.

  "A truly free market is void of any justice except what the individual can secure for himself against his assailant."

  Sounds like a true state to me, where the accused is the judge in their own case....

  "And what if the victim is weaker than his assailant? "

  And what if the victim is weaker than the monopolist which claims to provide justice for them? Oh wait...

  "Isn't the victim in a free market continually prevailed upon with fraud, theft, and injury? What is the difference of a free market, void a justice system, and socialist government? Isn't some intervention needed to secure justice?"

  Uh, no. Read The Market for Liberty to disabuse yourself of this nonsense. Why on earth should an outright monopolist do a better job of providing justice? Don't try blurring the difference to make socialism seem innocuous with these most simplistic arguments. The market does a better job of providing protection than the State, or any other quasi-socialist institution...

  "Is it just to eradicate protectionism that prevents the American laborer from competing against a foreign wage that is artificially lower than the real wage?"

  No, all protectionism must go everywhere.
  

  Published: May 25, 2009 3:48 AM

• Inquisitor

  "Human Action isn't a study of ethics but of profits and how the weak should be preyed upon by the strong."

  No, it's a study of action, and particularly economics, and not ethics. So that's correct, the rest is nonsense.

  Published: May 25, 2009 4:33 AM

• Enjoy Every Sandwich

  @Lael:

  You see, she understands that the American producer is being taxed to subsidize the Mexican price. Buying American is her way of restoring justice that the American justice system or Congress has failed to remedy. To illustrate, I will use an example:

  The Mexican product is priced at $5 after subsidization while the American product is priced at $10 after taxation. To spur economic growth in Mexico, the $2.50 in taxation from the American producer is used to subsidize the price of the Mexican product.

  Since the American government refuses to rescind the costs of taxation and/or regulation on American products, the hair lady, compelled by her ethics, buys American. It is her way of restoring justice to an unjust system that creates advantage for the Mexican producer through government intervention.

  Assuming that it is true that American products are taxed to subsidize the Mexican products (do you have any evidence for this?), then buying American products provides more tax dollars for the subsidies. That doesn't restore justice to the unjust system; it feeds the unjust system. Do you really think that giving the government more taxes will make it more just?

  Published: May 25, 2009 5:45 AM

• Magnus

  Is it just to eradicate protectionism that prevents American industry from competing against a foreign price that is artificially lower than the real price?

  There is no more hideously destructive economic falsehood in all the world than this one -- the idea that there is some price that is "just," whereas all other prices are somehow unjust.

  It's based on the idea that a price somehow has a moral quality. Prices themselves do not have a moral quality. None.

  Only human action is capable of being either moral or immoral -- using aggression (including fraud or theft) is immoral. Voluntary interactions are moral.

  The state is aggression. That's what it is. That's what it does. That's what it was designed to do. It asserts the right to commit acts that it deems to be crimes when anyone else does them. It asserts (1) the right to be the aggressor, and (2) to be immune from any resistance from its victims.

  The state is the idea that there is some special status you can confer on a person, call him a "government," and suddenly all his acts of aggression and theft and enslavement of others are swept away, transformed as if by magic from evil to pure as driven snow.

  It's not only absurd in the extreme, it's positively disgusting and morally atrocious. It's just so commonplace that people ignore it all around them.

  Free markets are at the very heart of ethics. Free markets ARE the economic expression of ethics, because only voluntary relationships are ethical.

  Published: May 25, 2009 8:24 AM

• Lael

  @Gabriel

  I believe humanity has the capacity for good through internal restraint rather than necessitating external restraint. However, as demonstrated by experience, either with tyranny by government or coercion by a mafioso, humanity, to a degree, falls short of that capacity time and time again. It is assumed that while the free market may not correct this problem in humanity, erecting government only helps to amplify it. I disagree. I believe the good outnumber the bad. All that helps to amplify the fault in human nature is for good men to do nothing in or out of government.

  Of course there is a retort: What need is there of government if good men can combine against the bad to preserve free market conditions? Is it not possible to contract the services of a combination of men for protection and the collection of debts? But even this avenue of protection is based on the principle of coercion and is nothing more than government itself. It seems to me that government is not the problem here but the people in control of it. Taking government out of their hands doesn't change their character or will/determination to dominate the weak. Nor does eliminating government dispel the weakness of the masses.

  The anti-state philosophy appears more and more like an anti-gun or a gun control advertisement.

  Published: May 25, 2009 9:34 AM

• Lael

  @Niko:

  "The Mexican product is priced at $5 after subsidization while the American product is priced at $10 after taxation. To spur economic growth in Mexico, the $2.50 in taxation from the American producer is used to subsidize the price of the Mexican product."

  I am not saying that this condition exists directly. One could argue that indirectly Mexican commerce receives a subsidy either in advantages of trade policy, foreign aid, or the building of infrastructure with American tax dollars (eg. transnational corridor.) But even if this condition existed, your response was: "Why not profit from a lower price?" Which only proves my point: Austrian economists do not care about what is ethical only what is profitable. The Ethics of Liberty is license in the immoral sense. We can continue to pursue the Utopian dream of Austrian economics where all men at all times only wish to be productive and make an honest living. Or we can deal with the reality that human nature is weak and some are willing to make a profit at the expense of others. After all, why not profit from a lower price even if that lower price is the result of subsidy? And we know that subsidy is theft whether it happens to our people or to a foreign population.

  You ask, "What kind of merchant wants to destroy his costumers?" Yet isn't that what you argue advocates of government protection are doing? Indeed, why do merchants want to destroy their customers by seeking government intervention? Again, this only illustrates that a free market cannot correct what is wrong in human nature. Government as a tool can, I will confess, amplify what is wrong with human nature or it can correct it. It only depends on the men, good or bad, who control it. My point is: The lack of government does not preclude what is wrong with human nature.

  Published: May 25, 2009 9:58 AM

• Lael

  @FTG

  You state:

  To include coercion as part of the free market (when coercion is contrary to freedom) and then conclude that "free markets are void of justice" is a classic example of Begging the Question.

  and

  devoid of justice systems (if that were the case), the weaker person could still contract services for protection or collection of debts.

  Aren't you Begging the Question? What good are the contracting of services of protection or collection of debts if not based on the principle of coercion? If a free market is based on voluntary human interaction, there can be no protection and no collection. I suppose the corollary is equally true: There could be no theft, no fraud, no injury because these necessarily require coercion. Doesn't this make a laissez faire a "utopian" scheme bound for failure because it fails to factor in the shortcomings of human nature?

  You have accused me of blaming the free market for human nature in the same manner you blame government for it. I argue that neither a free market nor government are the cause of human nature, they are simply environments in which human nature manifests itself. The former provides license and the latter restraint. I suppose you feel the contrary that human nature unrestrained by government will restrain itself and that only through government can license be provided to the shortcomings of human nature.

  Published: May 25, 2009 10:13 AM

• RWW

  Lael, your misunderstanding of Austrian econ is deep and troubling. You are mostly attacking a strawman. However, what is known, thanks to the work of Mises and others, is that government intervention cannot improve anything. Do some reading and see why for yourself.

  Published: May 25, 2009 10:15 AM

• RWW

  ...and your last comment reveals your complete unfamiliarity with Rothbardian anarchocapitalism and the meaning of terms like "voluntary" and "free market." Honestly, before you come with attacks, please first try to understand what it is that you're attacking.

  Published: May 25, 2009 10:19 AM

• Lael

  @FTG

  Are you talking about "dumping"? Because if you are, the thinking behind "dumping" is clearly nonsensical.

  My argument is that while consumers may benefit from the "dumping" of imports, producers do not. What, then, is wrong with protecting producers from such schemes as dumping? I mean, if you, as a producer, were taxed to subsidize your customers' purchasing power, wouldn't you raise your prices to offset the injustice? In the example of a foreign producer dumping in our economy, the domestic producer has no recourse but to seek a tariff to protect himself. Pursuing free trade gives an unfair advantage to the foreign producer and only ensures the domestic producers demise. By imposing a tariff, the domestic producer has only done what you would do as an entrepreneur if you were taxed in order to subsidize the purchasing power of your customers.

  Published: May 25, 2009 10:22 AM

• newson

  to lael:
  following your logic, all private donations of goods to third-world countries are wrong for the damage these free goods afflict on local producers.

  Published: May 25, 2009 10:27 AM

• Inquisitor

  "Aren't you Begging the Question? What good are the contracting of services of protection or collection of debts if not based on the principle of coercion?"

  No, he isn't.

  " If a free market is based on voluntary human interaction, there can be no protection and no collection."

  No, that doesn't follow. Try make it follow.

  "I suppose the corollary is equally true: There could be no theft, no fraud, no injury because these necessarily require coercion. Doesn't this make a laissez faire a "utopian" scheme bound for failure because it fails to factor in the shortcomings of human nature?"

  No, it doesn't. It merely requires them to be punishable offences.

  "You have accused me of blaming the free market for human nature in the same manner you blame government for it. I argue that neither a free market nor government are the cause of human nature, they are simply environments in which human nature manifests itself. The former provides license and the latter restraint."

  It's the reverse. The former provides restraint and prudence, the latter provides licence for its rulers and little else, unless you construe the term broadly.

  " I suppose you feel the contrary that human nature unrestrained by government will restrain itself and that only through government can license be provided to the shortcomings of human nature."

  Yeah, imagine that - a monopoly on the provision of protection services is not needed and people can think for themselves! :O No, how could this be! Instead we must allow a bunch of fools (well-intentioned or not, "experts" or not) to run our lives whether we want them to or not. How ridiculous.

  "The anti-state philosophy appears more and more like an anti-gun or a gun control advertisement."

  No, it's more of a "let people choose whom to contract for protection services from" philosophy...

  Published: May 25, 2009 10:33 AM

• Lael

  @RWW

  My understanding of Austrian economics comes from reading articles and comments by alleged Austian economists who suggest:

  1. Dumping by foreign nations is a boon to the American consumer.

  2. Inflation is a boon to America because our creditors are paid off with a devalued dollar.

  I was surprised to see Austrian economists marginalize government intervention so long as it was profitable to them (not that they would advocate interventionism but since it exists, why not profit from it.)

  Nevertheless, even in a truly free market, coercion exists. What exists in a free market to combat the negative force? Some suggest voluntary positive force. But isn't that government?

  Seems to me that the Austrian cannot get away from advocating government of some kind. It is the difference from local decentralized government (ie. federalism) and big centralized government (ie. nationalism). Why not call a spade a spade instead of pretending that government is not a voluntary association?

  Published: May 25, 2009 10:45 AM

• Lael

  @newson

  following your logic, all private donations of goods to third-world countries are wrong for the damage these free goods afflict on local producers.

  The difference is that private donations are not theft, do not subsidize prices nor oppress labor. Also, it does not take away a consumer from a producer because that consumer couldn't afford the producer's product anway. Hence the need for charity.

  Published: May 25, 2009 10:49 AM

• RWW

  ...pretending that government is not a voluntary association?

  Ha, what? I never consented to join your government.

  Published: May 25, 2009 10:58 AM

• Lael

  @Inquisitor

  Government exists to punish the bad not to control the good. Of course, as any other tool (like a gun), it can be used to control the good and give license to the bad. But this makes my point: Human nature existed before government. I understand that you believe government to be the concrete manifestation of what is wrong in human nature but I see government as an attempt to correct what is wrong in human nature. As you put it: To punish "punishable offences." After all, government is the voluntary method by which individuals have decided to enact these punishments. Why aren't the people allowed to act voluntarily through government against the criminal? Why must they be forced to have only the option of vigilante justice as advocated by the anarchist?

  Published: May 25, 2009 10:58 AM

• RWW

  It seems there's a misunderstanding here. Lael, could you please define very precisely what you mean by "government"?

  Published: May 25, 2009 11:05 AM

• Lael

  @RWW

  I never consented to join your government.

  You imply consent by staying or by participating in the political process. Maybe you have done neither, I don't know you. But maybe you are right, there should be a gradfather clause in every constitution. That way you can violate the property and rights of those who have not been grandfathered.

  Were Mises ever to make the argument you just made (which I doubt he ever would), it would be an embarassment to Austrian economics and the Mises Institute. After all, he did consent to join our government. If Mises could do it, why can't you?

  Published: May 25, 2009 11:05 AM

• Lael

  @RWW

  Lael, could you please define very precisely what you mean by "government"?

  
  Strictly? Government is a social compact voluntarily entered into by free and independent individuals. Those individuals can be malignant or benign. Often times, the benign enter into government because the malignant have done likewise. Government is a tool. It is neither good or bad, it is neutral. It is, as stated above, the voluntary association, by compact, of free and independent individuals seeking a common goal or pursuing a common cause. It is a contract and it is a gun. It is a purchase in the free market. It is human action. It is the result of a free market.

  Published: May 25, 2009 11:21 AM

• Lael

  It is the result of a free market.

  If government is evil, then so is a free market. That is why anarcho-capitalism is an oxymoron, a contradiction. Government cannot be inherently evil unless the free market is inherently evil. Government is the result of free markets. It is the child of free markets. If there is anything evil in government, it can be found only in the person(s) wielding it or violating its terms of agreement.

  Even anarchy requires a social compact: that all agree there shall be no "government." And so shall they thus be governed. Violators to be prosecuted under the law or lack thereof.

  Anarchy creates a paradox, if you know what I mean.

  Published: May 25, 2009 11:30 AM

• RWW

  Okay, so none of the organizations existing in the world at the moment, which people usually refer to as "governments," fit your definition, since their subjects did not all enter into them freely. If you're taking the nonstandard route of calling voluntary associations "governments," then I agree with many of your statements about those entities. But what most people mean by the word "government" is not "voluntarily entered into."

  I suppose a further point of confusion is what you mean by "social compact," but I assume you mean a contract of some sort, with people consenting to it (or not consenting) on an individual basis. Of course, this doesn't fit the organizations generally referred to as governments today; for example, I live in the US, but I never signed or otherwise affirmed any contract to join the federal government, or any other such organization here.

  Published: May 25, 2009 11:35 AM

• Briggs

  Very interesting. I have wondered that myself. I like Dr. Woods's hypothesis.

  My question is what to do? Do we have some prima facie obligation to explain to all such people the error in their logic? Do we only try to enlighten those whom we deem to have a sufficient intellect to understand? Do we simply save our energy and allow them to continue their erroneous thinking without trying to preach to them?

  Personally, I usually act based upon my perception of their intelligence. If I think they are capable of understanding the logic, if properly explained, then I make some attempt to help. I do not know if this is the proper course of action or not.

  Published: May 25, 2009 11:39 AM

• Magnus

  After all, government is the voluntary method by which individuals have decided to enact these punishments. Why aren't the people allowed to act voluntarily through government against the criminal?

  The State does not relate to people voluntarily.

  It claims to have the right to compel everyone in its territory to comply with its dictates.

  
  You imply consent by staying or by participating in the political process.

  Nonsense. You are not merely wrong, but completely nonsensical.

  The claim that I "implied consent" by being here is totally bogus and illegitimate. I gave no consent. Consent only exists where you have the option to refuse and not be attacked for having refused.

  The idea that the State has the right to attribute consent to anyone who is physically inside its supposed territory rests on the assumption that the State has the power to compel the behavior of anyone in its territory. It's patently circular, and therefore false. It's childish to even pretend this "consent by remaining" nonsense is a remotely valid argument.

  Published: May 25, 2009 11:40 AM

• RWW

  The claim that I "implied consent" by being here is totally bogus and illegitimate.

  Well, it could be that the government actually owns the territory it claims to govern. If that is the basis of Lael's claims, then at least it would make some sense...

  Published: May 25, 2009 11:46 AM

• Lael

  The terms of a contract are often binding on the children of those having entered into the contract. Why shouldn't it be the same with government? She we just liquidate/absolve the obligation imposed upon children by their parents profligate spending? To do so would amount to theft of others partnered in the contract.

  This is why government, even if not directly entered into, is binding. Because it is a contract entered into by our parents by which, they having failed in their obligations, we are required to make good. Until the contract is fulfilled, our posterity will continue to suffer the burden. Remember, government is a contract entered into by the masses amongst themselves. Government cannot violate the contract (that would be circular -- a contract violating itself), only we can. And we have. One sector of society has violated the contract entered into with another sector of society and in the contract we are all bound, even our posterity, until the contract is made right and fulfilled.

  At least, that would be the honorable thing to do. Or unless we define liberty as license.

  Published: May 25, 2009 11:49 AM

• RWW

  Government cannot be inherently evil unless the free market is inherently evil. Government is the result of free markets.

  Allowing for the sake of argument that the government arose from a free market situation, your line of reasoning is a false dichotomy. The existence of evil under a certain system does not make the entire system evil. Your logic is laughable.

  Published: May 25, 2009 11:50 AM

• RWW

  You know, Lael's argument is just getting downright silly. At first, with the bit about subsidies, it seemed there might be some valid point in it, although it was unfortunately never justified, but now it's just a bunch of tired old fallacies.

  Published: May 25, 2009 11:52 AM

• RWW

  The terms of a contract are often binding on the children of those having entered into the contract.

  You're seriously arguing that it's just for someone to be bound by a contract they never actually consented to? That's just sick.

  Published: May 25, 2009 11:54 AM

• Inquisitor

  "Government exists to punish the bad not to control the good."

  Ok. Let's then call coercive government the State. Same conclusion follows.

  " Of course, as any other tool (like a gun), it can be used to control the good and give license to the bad."

  The state invariably is.

  "But this makes my point: Human nature existed before government. I understand that you believe government to be the concrete manifestation of what is wrong in human nature but I see government as an attempt to correct what is wrong in human nature."

  By granting a coercive monopoly to certain of these presumably flawed beings, it is so arrogant to believe that it can "correct" them? Who is to correct it and its excesses?

  "As you put it: To punish "punishable offences." After all, government is the voluntary method by which individuals have decided to enact these punishments. Why aren't the people allowed to act voluntarily through government against the criminal? Why must they be forced to have only the option of vigilante justice as advocated by the anarchist?"

  Why aren't people allowed to choose who will effect punishment and whether or not they wish to abide by their protector's rules, choosing between one they favour and perhaps none at all if they so desire? The truth is no one is allowed to act voluntarily through the state. It is their protector whether they like it or not, when it chooses to be, on its terms with the only limitation being that it might suffer from emigration, if it allows it.

  And as for your caricature of anarchism, LOL! Seriously, read The Market For Liberty... then again I prefer vigilante justice to the mafia (aka State)...

  Published: May 25, 2009 11:57 AM

• Lael

  @Magnus

  The idea that the State has the right to attribute consent to anyone who is physically inside its supposed territory rests on the assumption that the State has the power to compel the behavior of anyone in its territory. It's patently circular, and therefore false. It's childish to even pretend this "consent by remaining" nonsense is a remotely valid argument.

  Maybe you haven't read Hans Herman-Hoppes'
  "The Case for Free Trade and Restricted Immigration"

  http://mises.org/journals/jls/13_2/13_2_8.pdf

  The government need not even own the land to expel those who refuse contract with it because it is only doing what those who have so contracted have authorized it to do (which consequently, Hoppes argues the people themselves had a right to do in the first place!)

  Published: May 25, 2009 12:01 PM

• Inquisitor

  "If government is evil, then so is a free market. That is why anarcho-capitalism is an oxymoron, a contradiction. Government cannot be inherently evil unless the free market is inherently evil. Government is the result of free markets. It is the child of free markets. If there is anything evil in government, it can be found only in the person(s) wielding it or violating its terms of agreement."

  Nah, it's the child of some people using force to get others to do their bidding. Only defensive force is justifiable and only it is justified under a market order. Anything else is to be punished. Including states foisted upon people...

  "Even anarchy requires a social compact: that all agree there shall be no "government." And so shall they thus be governed. Violators to be prosecuted under the law or lack thereof."

  Consentually entered upon agreements. Where's the "contradiction"?

  "Anarchy creates a paradox, if you know what I mean."

  No, I don't.

  Published: May 25, 2009 12:02 PM

• Inquisitor

  "The government need not even own the land to expel those who refuse contract with it because it is only doing what those who have so contracted have authorized it to do (which consequently, Hoppes argues the people themselves had a right to do in the first place!)"

  Please read Hoppe more carefully. This is careless garbage. Hoppe's argument is strictly hypothetical (if the state arrogates itself the role of controlling the borders, then it should act as a private owner and increase value rather than decrease it.) As a matter of fact Hoppe thinks no State claim to any territory is justified in anyway because no State has ever forged any link in the form of homesteading with the territory it claims. Read his Economics and Ethics of Private Property or A Theory of Socialism and Capitalism where he outlines his theory of property, or Democracy - The God that Failed. God how ignorant some people are... So how you came to use Hoppe in defence of your specious arguments is beyond me. Opportunism?

  Published: May 25, 2009 12:06 PM

• Lael

  @RWW

  The existence of evil under a certain system does not make the entire system evil.

  That is exactly the point I am trying to make. Government isn't evil simply because some of its constituent parts are evil.

  Published: May 25, 2009 12:16 PM

• Lael

  @RWW

  You're seriously arguing that it's just for someone to be bound by a contract they never actually consented to? That's just sick.

  I take it you don't believe I should pay off my father's debts. That it doesn't concern me he stole from another or to make right my father's wrongs.

  I suppose I will have to think about that one. Should a son be required to make reparations for breaches of contract by his father?

  Published: May 25, 2009 12:22 PM

• Lael

  @Inquisitor

  By granting a coercive monopoly to certain of these presumably flawed beings, it is so arrogant to believe that it can "correct" them?

  By "flawed," I mean malignant. Not all flawed individuals are malignant though all individuals are flawed. Why must malignant individuals necessarily have to be empowered much less granted a monopoly on coercion? I see government as added protection to a man's own right to defend himself. A compliment, if you will. Not a supplement.

  Published: May 25, 2009 12:27 PM

• Lael

  @Inquisitor

  no State claim to any territory is justified

  I guess I just don't see it as a claim made by the State, rather, services rendered as required by contract amongst the people. If I am hired by someone to protect their property, does that really mean I am making claim to it?

  I agree that public property redefines the purpose of the State. Instead of government being a contract amongst people, it becomes a party to that contract. It is no longer a tool but a "person." Nothing could be more absurd.

  Published: May 25, 2009 12:37 PM

• Ben Ranson

  Briggs brings up an interesting moral issue, "Do we have some prima facie obligation to explain to all such people the error in their logic?"

  I do not believe that we do. As the war of words on this blog shows, such attempts are frequently ineffective.

  Libertarians have a well-deserved reputation for being argumentative. I have never succeeded at convincing anyone of anything with a long back-and-forth argument. Most people dislike having it pointed out that they are wrong, and respond accordingly.

  On social occasions when I am confronted with particularly obnoxious economic fallacies, I try to confront the issue as gently as is possible. I think that the best way is, if I know it, to explain the historical origin of the particular questionable idea, and to describe some of the negative consequences that resulted when governments put the idea into action.

  Instead of allowing myself to be drawn into an argument, I change the subject.

  By the way, Zombiehero, I enjoyed the essays.

  Published: May 25, 2009 12:53 PM

• Lael

  @Ben Ransom

  "Do we have some prima facie obligation to explain to all such people the error in their logic?"

  I do not believe that we do.

  Again, when good men, men of understanding and virtue, do nothing. I think there is a moral obligation. Not everyone in error wishes to remain in their error. Some are honestly seeking the error of their ways. Your inability to show them should not be mistaken as an unwillingness on their part to see.

  @RWW

  Thanks for giving me something to think about. The questioned begged "Should a son be required to make reparations for breaches of contract by his father?" may be the crux of whether government is necessary or not. I think you are right from a Jeffersonian stand point that once the contract is breached, it is dissolved and has no lasting effect on progenitors.

  Why would a victim want to remain in a contract that has no recourse for righting wrongs? To remain would invariably lead to a perpetuation of those wrongs upon oneself. Viewing the breached contract from the perspective of the victim rather than the perpatrator provides clarity.

  Published: May 25, 2009 1:07 PM

• FTG

  Replying to Lael:
  Aren't you Begging the Question? What good are the contracting of services of protection or collection of debts if not based on the principle of coercion?

  "Coercion" is the initiation of force, Lael. If a person commits fraud, he already engaged in an initiation of force, or aggression, against the other party's property rights. Instead, seeking compensation is not initiation of force, hence it is NOT coercion - you cannot steal my dog and then complain that I am "coercing" you when asking you to give it back.

  If a free market is based on voluntary human interaction, there can be no protection and no collection.

  Never say never - It does NOT FOLLOW that there cannot be protection or collection of debts in a voluntary system of interactions. "Voluntary" does not mean "passive" as if a voluntary system was akin to a colony of polyps.

  I suppose the corollary is equally true: There could be no theft, no fraud, no injury because these necessarily require coercion.

  If all people were angels, it would follow. But people are not angels - the voluntary aspect of the interactions stem from people seeking improving their situation. In a coercive interaction, only one of the parties improves his situation; however, it becomes rational for the other parties to at least avoid the zero-sum game by either seeking compensation from the aggressor, protecting themselves against the aggressor, or eradicating him.

  Doesn't this make a laissez faire a "utopian" scheme bound for failure because it fails to factor in the shortcomings of human nature?

  Laissez faire is not a scheme, Lael - it is simply "letting people be", or simply letting people pursuit their interests. It is not some sort of top-down imposed idea. It is people that factor in their own shortcomings.

  You have accused me of blaming the free market for human nature in the same manner you blame government for it.

  Unless you posted as Lyle, I made no such accusation. I replied to your comments about what it read as "dumping".

  
  I argue that neither a free market nor government are the cause of human nature, they are simply environments in which human nature manifests itself.

  That wasn't your argument above. You made comments about subsidized prices. Again, unless you first posted as Lyle, you made no such arguments last night.

  
  The former [free markets] provides license and the latter [government] restraint.

  You are misconstruing both concepts. "License" is not what describes the free market, since "license" implies "permission" or "allow". A free market implies free and voluntary exchanges or interactions, not simply license. By the same token, a government is not necessarily an agent of restraint, its profligacy and its penchant for taking property hither and tither being proof of the contrary.

  Regarding your next reply:

  My argument is that while consumers may benefit from the "dumping" of imports, producers do not.

  Again, you beg the question - the concept of "dumping" is nonsensical, so saying that it hurts producers is begging the question.

  What, then, is wrong with protecting producers from such schemes as dumping?

  What's wrong is that "dumping" is nonsense. What really happens is that some unprofitable producers seek the protection of their markets by coercive actions by a government, regardless of the fact that their costs are higher than their competitors.

  I mean, if you, as a producer, were taxed to subsidize your customers' purchasing power, wouldn't you raise your prices to offset the injustice?

  Lael, this is nonsense - whatever reason exists to be taxed by the state, it does not follow that taxation subsidizes consumers. The answer to taxation is not protection, because that would be like taxing the consumers just to benefit me, which is not different from stealing. If my business is not profitable, even if only because of facing taxation, I either move my business elsewhere or I close it.

  In the example of a foreign producer dumping [sic] in our economy,

  Lael, quit repeating yourself - dumping is a nonsensical (i.e. fallacious) concept.

  
  [...]the domestic producer has no recourse but to seek a tariff to protect himself.

  This is false - he can also close his business, move it to a more business-friendly venue or move overseas. There are always alternatives that do not call for government-sanctioned thievery.

  Pursuing free trade gives an unfair advantage to the foreign producer and only ensures the domestic producers demise.

  There is nothing "unfair" about allowing people to purchase from whichever producer they choose. Saying that producers have an "unfair advantage" because they can produce at lower costs is a classic example of a Red Herring.

  Published: May 25, 2009 2:23 PM

• FTG

  Lael, I could not simply let you get away with the following comments without a reply:

  If government is evil, then so is a free market.

  Ah, and if a free market is not evil, then necessarily government cannot be evil as well. Cute. Unfortunately, both premises are false.

  In order for your premise to be correct - that if government is evil, so must be the free market, the nature of both must be the same.

  The nature of a free market is voluntary, mutually beneficial interactions between humans. It is called a "Free" market because people are free to seek and indulge in these trades or transactions. Is the government the same?

  If government had a purely voluntary nature, then it would follow that it would be the same as a free market. However, the concept of government is the monopoly of aggression. If it did not have this monopoly, it would not be government. Since the free market does not function under a coercive, force-initiating nature, then it CANNOT BE EQUATED to government.

  If, you argue, you cannot differentiate the two because both are made by people, then you are committing a Fallacy of Composition. I can argue then that soccer teams and gangs have the same nature since both are made by people, but it is obvious that such conclusion is fallacious.

  That is why anarcho-capitalism is an oxymoron, a contradiction. Government cannot be inherently evil unless the free market is inherently evil.

  You beg the question by concluding from your false premise. The nature of a free market, even if done by evil people, is one of voluntary transactions - the process itself cannot be evil since it does not involve coercion or aggression, but free and voluntary exchange. Government has the monopoly of aggression and uses aggression in order to impose its decisions. You cannot thus say they are the same, for they cannot be.

  Government is the result of free markets.

  This is a lie. Just by history, governments have emerged through conquest and direct submission. Even the current American government was imposed upon people by purportedly elected "representatives" that made the decisions for everybody else, not by voluntary transactions.

  Even anarchy requires a social compact: that all agree there shall be no "government."

  As Etienne de la Boetie showed, such "agreement" is not needed, as governments and tyranny exist by acquiescence and not because people agreed one with another to have a government. If people do not acquiesce to the mandates of a self-named government, it will have no power. So all you need for an anarchist society to exist is for people NOT acquiescing - no social agreement needed. Just as there is spontaneous order in a free market, an anarchist society would be just as spontaneous when each individual, by choice, does not answer to any form of government.

  Anarchy creates a paradox, if you know what I mean.

  No, it doesn't, if you understood what I meant.

  Published: May 25, 2009 2:47 PM

• Lael

  @FTG

  I agree that government is force but I don't believe it was ever intended to be a monopoly of force (e.g. 2nd and 10th Amendments to the Bill of Rights.) I don't recall the United States government, in its infancy, ever being erected by conquest and direct submission. But for the majority of the world and even here, after the civil war, that may be the case. It seems that the ideal government is as elusive as the ideal market economy. Can you have one without the other? And does the ideal government necessarily have to be no government at all? When evil men combine in a government, what is to protect the free market if the people have themselves no government at all?

  Published: May 25, 2009 3:10 PM

• Lael

  @FTG

  If we do not erect government to protect against evil men who combine into governments are we not leaving our posterity to be conquered and directly subjugated to the will of evil men? If men do not choose a government of their own, won't they have one imposed upon them?

  Published: May 25, 2009 3:22 PM

• Lael

  If men do not choose a government of their own, won't they have one imposed upon them?

  And please don't answer "No," else why do anarchists complain?

  Published: May 25, 2009 3:25 PM

• Lael

  @FTG

  If my business is not profitable, even if only because of facing taxation, I either move my business elsewhere or I close it.

  
  You should tell that to Magnus. He doesn't feel that remaining is consent to government taxation, that he should be allowed to be profitable without having to move his business elsewhere. Why are you so quick to acquiece? Maybe tariffs aren't the solution and maybe it is easier to move than to fight taxation and regulation.

  Published: May 25, 2009 3:41 PM

• Michael A. Clem

  When evil men combine in a government, what is to protect the free market if the people have themselves no government at all?
  
  These types of questions have been answered many times here at Mises (check out the Mises Community). One of the most important aspects of government is not merely that it monopolizes law and law enforcement, but that it is "protected" by an aura of legitimacy, legitimacy that ordinary people such as yourself grant it. Without that legitimacy, government would be recognized as the protection racket that it fundamentally is, and would have a harder time keeping a nation of people under its control. If anarcho-capitalism were to exist, it could only exist with the understanding by a majority of its people that nobody has any moral right to have power over other people, and that any such institution that tried to aggress against others must necessarily be illegitimate.
  
  Governments are not the results of a free market, but common and customary legal systems have been in the past. Check out info on Merchant Law, for example. If we are ever to be truly free, it is necessary to have a proper understanding not only of government, but of law itself.
  

  Published: May 25, 2009 3:46 PM

• FTG

  Lael,

  I agree that government is force but I don't believe it was ever intended to be a monopoly of force (e.g. 2nd and 10th Amendments to the Bill of Rights.)

  You cannot argue the nature of government based on the amendments of the constitution.

  I don't recall the United States government, in its infancy, ever being erected by conquest and direct submission.

  Then my advise to you is that you read your history again, and see how the current government was born after a war (however valid the motives to fight it), through a purported "ratification" process that created the federal government, and not through a market process.

  It seems that the ideal government is as elusive as the ideal market economy.

  Depends on how you define your ideal government. My ideal government would be one that existed in a remote island where people are free to go there and worship it, leaving the rest of us productive people alone. But that is just me.

  Can you have one without the other?

  Of course you can.

  When evil men combine in a government, what is to protect the free market if the people have themselves no government at all?

  There's a contradiction in your question - which makes it loaded. You will have to rephrase it. If evil people combine to form a government, then how can you ask how people are to defend from it SANS a government?

  If we do not erect government to protect against evil men who combine into governments are we not leaving our posterity to be conquered and directly subjugated to the will of evil men?

  I don't understand where are you going with this question - it would seem you are asking how can people defend themselves from marauding conquerors without first creating a government to defend the people. However, history shows us that there is no direct relationship between having a government and being able to defend from marauding assailants, the government actually being more of a liability than an asset as it centralizes the monopoly of force, making itself the obvious target. Instead, people's militias are more effective at negating the conqueror's control of territory and resources, as the various wars in Afghanistan has shown, currently, or the revolutionary wars in the American colonies have shown in the past.

  If men do not choose a government of their own, won't they have one imposed upon them?

  You mean by aliens? Or do you mean if SOME men do not choose a government...?

  Published: May 25, 2009 3:52 PM

• FTG

  Lael,

  He [Magnus] doesn't feel that remaining is consent to government taxation, that he should be allowed to be profitable without having to move his business elsewhere. Why are you so quick to acquiece? Maybe tariffs aren't the solution and maybe it is easier to move than to fight taxation and regulation.

  No, I told this to YOU because you made the assertion that producers had NO OTHER RECOURSE but to ask for protection from competition. I argue that there are always ALTERNATIVES to thievery, which is what protectionism can be construed to be.

  What Magnus argues is the morality of taxation itself so as to have as valid to require a quid pro quo from the government in the form of protection from competition from abroad. But taxation itself IS immoral and, as Magnus argues, the OTHER recourse a producer has is to lobby to have his taxes reduced for he has a right to keep the fruits of his labor and his property. I argue that there are also other alternatives just as valid, in contrast with the INVALID (or immoral, unethical) recourse of asking for protectionist impositions.

  Published: May 25, 2009 4:03 PM

• Lael

  @FTG

  Instead, people's militias are more effective at negating the conqueror's control of territory and resources

  I understand. If the Framer's of the Constitution did not think the people's militia (2nd Amendment) was the best check to conquering governments (including their own), they would never have erected government in the first place.

  Published: May 25, 2009 4:25 PM

• Magnus

  Lael: The terms of a contract are often binding on the children of those having entered into the contract. Why shouldn't it be the same with government? She we just liquidate/absolve the obligation imposed upon children by their parents profligate spending? To do so would amount to theft of others partnered in the contract.

  No, contracts are absolutely not binding on children, nor are they binding on anyone who is not a party to that contract. That's very simple, and the fact that you so profoundly misunderstand it is, I believe, the essence of your error and confusion.

  Dude, that's seriously screwed up.

  
  This is why government, even if not directly entered into, is binding. Because it is a contract entered into by our parents by which, they having failed in their obligations, we are required to make good. Until the contract is fulfilled, our posterity will continue to suffer the burden. Remember, government is a contract entered into by the masses amongst themselves.

  I have believed for some time that people's basic belief in the State is an outgrowth of their experience as children in dysfunctional and abusive families. You, Lael, are the latest piece of evidence in support of this theory.

  The US Constitution as a contract? Really? Read Spooner's No Treason No. 6. He demolished that whole contract idea 150 years ago. (http://praxeology.net/LS-NT-6.htm)

  I can already see where this is going. Lael will recite a few more well-worn statist cliches, continue to dodge everyone's direct questions, change the definitions of essential terms, attempt to re-frame the debate, and when he's finally cornered and forced to confront his fallacies and finds that his errors cannot be maintained, he'll simply disappear.

  The idea that the State is the father, whose contract is somehow binding on me is, well, beyond reason. His errors are not based on reason, so they cannot be corrected with the application of reason.

  His errors are the product of deep psychological issues related to fathers and families. This means that before Lael could possibly accept ideas that refute the State=Father idea, he would have to uproot what I am sure is a lifetime of psychological defenses, assumptions and emotions.

  Published: May 25, 2009 8:30 PM

• Peter

  She we just liquidate/absolve the obligation imposed upon children by their parents profligate spending?

  What? What obligation? Your parents can't sign you up to any contract they agree to.

  Published: May 25, 2009 10:51 PM

• Lael

  @Magnus

  Lael, are the latest piece of evidence in support of [the theory that] the State is an outgrowth of [some people's] experience as children in dysfunctional and abusive families. [...] The idea that the State is the father, whose contract is somehow binding...is, well, beyond reason. [Your] errors are the product of deep psychological issues related to fathers and families.

  I will admit that I come from a dysfunctional family. But it wasn't my father that was dysfunctional, rather my mother. Regardless, my views on the State, specifically ours, is rooted in what I have read and inferred, correctly or incorrectly, in the Constitution. I am not concerned with the contracts that other nations have made. I am concerned only with what drove the framers of the Constitution to erect government, knowing it would live on after them, if, as Spooner suggests, they could have in NO WAY intended it to be binding on posterity.

  It seems to me that Spooner is reading into the Constitution. My question was one of the era in which the framers of the Constitution lived. Spooner may feel that contracts are not binding on posterity but what was the prevailing belief about contracts in the days of the framers of the Constitution and did they agree with it? What did the framers of the Constitution mean when they included in the preamble ...and our posterity? Spooner provides no commentary by any framer of the Constitution on this passage. I am suppose to just accept that Spooner knows better what the Founders believed than they did.

  I agree with Spooner that contracts should not be binding on posterity, but is that how the framers of the Constitution understood contracts?

  I can already see where this is going. Lael will recite a few more well-worn statist cliches, continue to dodge everyone's direct questions, change the definitions of essential terms, attempt to re-frame the debate, and when he's finally cornered and forced to confront his fallacies and finds that his errors cannot be maintained, he'll simply disappear.

  One can expect that two individuals of differing beliefs and understanding, having never encountered the other belief or having only a cursory acquaintance with it, and utilizing the same vocabulary will run into confusion. It is often called "talking past each other" and it happens in religion all the time. But this doesn't mean one is trying to deceive the other. It just means they don't understand eachother.

  Nor should a person forsake a belief simply because one premise has been debunked. Entreating all premises upon which belief is founded should not be construed as re-framing the argument. Again, nothing deceptive here.

  Finally, if I am shown the light and come to a recognition of my fallacious reasoning, why should I stick around. Shouldn't I disappear spreading the good news? Or are you suggesting I should continue to play devil's advocate? That is something a person with psychological problems might do I suppose.

  Published: May 26, 2009 4:09 PM

• Magnus

  I agree with Spooner that contracts should not be binding on posterity, but is that how the framers of the Constitution understood contracts?

  What the signers of some 200 year-old document may have believed when they signed it is of no significance whatsoever. The constitution is no more binding on others than if someone were to sign a contract with his best friend providing that all commenters on Mises.org calling themselves "Lael" shall henceforth be the signers' slaves. Such claims are "mere idle wind."

  The signers of the constitution also believed in the legitimacy of slavery. Their opinions on the subject did not make it valid. Slavery is an illegitimate claim of property in something that never was property, never could be property and never will be property. It was illegitimate and void, and thus a crime, regardless of anything written to the contrary in any ancient document.

  I was not a party to the constitution. No living person was a party to it. I did not consent to it. Consent cannot be extracted by force.

  It's that simple.

  Published: May 26, 2009 4:31 PM