Author: Curt Doolittle

I dont like to criticize postings at the Mises Institute, of whom I have been a member and supporter for almost a decade. It is far less work to improve on small errors than to solve catastrophic ones. And therefore less work, and more reward, to criticize your friends in the hope of making progress, rather than undertake the vast effort of correcting your enemies in a vain attempt at altering their desires, when their arguments justify their desires rather than their desires being the outcome of good argument. There was another recent posting on the MI blog regarding the use of private property. It proposes unlimited permission to use private property for private ends. And, I simply don’t like this facet of libertarianism. I don’t think it helps our cause. It’s not that I have sentiments against these kind of arguments. Its that I know that these arguments are not only false, but they’re fraud – theft. And if property and freedom are the underlying principle of libertarianism, then theft is the opposite of libertarianism. And the article by David Albin entitled Historic Preservation VS Private Property Rights is an example of how libertarian thought has incorporated the justification of fraud and theft into it’s doctrine by defining property to PERMIT fraud and theft. And, I see it as my duty, and that of any other seeker of freedom, to undermine any such doctrines so that we can continue our efforts to correctly identify the scope of powers that we must endow to the minimal state so that we may preserve our freedom (juridical defense), our property (registries of opportunity that permit economic calculation), and our prosperity (hours gained and prices decreased by dividing knowledge, labor, and and time.) The reason I have a problem with these errors, is that they have consequences. In particular, such errors as Mises and Rothbard (and Rand) have inserted into the discourse, have tainted the school of thought we call Austrian, such that some members of the libertarian movement are abandoning the term Austrian and adopting the general “libertarian” label, in an attempt at creating distance from the Rothbardians who are trying to legitimiza themselves by adopting the historical label of “Austrians”. In this broader context, the article, as as an example of the errors in the movement, is a proponent of fraud, is counter intuitive to the civic republican tradition to the extent that it appears to freedom seekers as either immoral or criminal, resulting in decreasing adoption of the principles of freedom. It weakens the insight that Hoppe has given us into democracy, monarchy and their corollary the coordination and calculation problem, deprecates the good Austrian thought of Hayek, Popper and Parsons, discounts the valuable part of Rothbard’s analysis of property and incentive, and taints Mises accumulated scholarship and wisdom by emphasizing a failed system of logic (Praxeology) — which failed because of it’s erroneous definition of property and limited definition of action, the logical necessity of which it purports to rely as an observational science in an effort to justify it’s conclusions and therefore act as a functional abilty to persuade people to adopt policy and political ends. This error is both a moral hazard and an intellectual one. intellectual because it advocates something that the movement specifically exists to support, and Moral because it does not facilitate the preservation and advancement of freedom. I have taken on the labor of rewriting a number of chapters of Human Action by Mises such that the statements are positive and do not incorporate the errors caused by Misesian limitations on action, and Rothbardian limitations on property. Hayek likewise could be corrected for his use of sensory order rather than calculative order, and thereby making the sentiments in traditional knowledge as he defines it, articulable in Rothbardian language. Approaching the works of these authors with these corrections is useful for both my self education, but also for revising the vast doctrine of examples and a priori language that have been build up in the field. This is a heroic effort, and I may not, partly because of the age at which I started working full time on the problem, be able to complete it. If I make a dump on my property next to yours have I not stolen from you? If a man wishes to use violence against you, is that not because he feels his property has been stolen? Isn’t this the entire premise of libertarian property rights, which is, that the state has allowed violation of property rights (by pollution in particular) in the name of ‘social good’? What’s the difference in going to a city council and asking to resolve disputes and going to a judge to resolve disputes and going to a sheriff, or priest, or tribal elder to resolve disputes? The answer is just the different criteria that the judge uses to determine his ruling. A city council who asks you to absorb losses is different from the city council who prevents you from speculating (in this case, that’s what’s going on, speculating.) Speculating is a risk. Quite unhappily for my friends here, individual property as a conceptual institution and it’s political institution of juridical defense (what we called freedom) is an outgrowth of the european system of fraternal defense, and in particular, fraternal defense of cities. While there were origins in greece’s fraternal order, the egalitarianism of the Civic Republican tradition is a european artifact – and a Germanic one at that. People ‘pay’ for property rights by restraint: by forgone opportunity. They pay for the political institutions by forgone opportunity. These costs are more substantial costs for the strong than for the weak. The ongoing justification for property rights is a) production increases in the division of labor and the decreased consumption of time, and the resulting reduction in prices, b) the conversion from a tax to a credit society allows a development of a code of laws for different social classes who are more productive or less productive than one another, and as such the cost of administration of a populace is distributed across the population. c) the decline in violence between groups who would otherwise resort to violence. d) the virtuous cycle resulting in the fulfillment of wants and needs. If I act to decrease the value of your property either directly or indirectly, why are you not simply STEALING from the pool of forgone opportunity investment? In other words, if other people who are affected by secondary costs REFRAIN from attempts at development they are paying an opportunity cost. If they codify this cost as a PROPERTY RIGHT by registering that loss with a property registry (the council) then anyone’s attempt to circumvent those registries is simply an act of fraud and theft, using the ruse of property rights to steal. That is the correct application of libertarian (hoppian) property rights, because those are the set of both the ACTIONS (costs) and RESTRAINTS (costs) that people take in order to make use of hte institution of private property. The attempts by certain sects of libertarianism to undermine this process of property rights is NOT the defense of property rights but a SCHEME for organized THEFT. This ‘sect’ of libertarianism is very easy to identify once we use the Misesian Doctrine that you can ACT by acting and ACT by not acting. You can also pay costs by ACTING and pay cost by NOT acting. There is no difference between a joint stock company and a city council as long as teh council is taking deposits on forgone opportunities RATHER than exploiting forgone opportunities. There are many types of property registry. It is the transformation of these institutions from property registries to political forces by which property can be extracted from forgone opportunities, rather than registries are a collection of forgone opportunities, a joint stock company, by which people can use micro payments of forgone opportunity to capitalize their efforts. To capitalize wealth by INACTION rather than action. To capitalize opportunity costs. This may be a big leap, but it is the missing part of Mises->Hayek->Rothbard->Hoppe, and the theory of human action embodied in Mises work, and personally, I find it a convenient means of attempting to STEAL from the wishing-well of deposits made over time by various people of all strata in an attempt to privatize wins and socialize losses. Mises made a mistake because he had too narrow a view of social cooperation, possibly because of his upbringing. (which Hayek noted.) Hayek was not able to correct mises, largely because he was distracted by his concepts of Sensory Order (because of his upbringing), and to turn his observations on common knowledge into action statements as did Mises. Rothbard continued to make progress but relied upon natural law, either as a means of avoiding the underlying problem or simply because he could not see the underlying problem. I see it eitehr as avoiding the problem, or a distraction resulting from egoism. Hoppe has almost corrected Rothbard’s bias. But these systems of thought all focus on visible actions and costs rather than the less visible forgone actions and costs. They justify ignoring them because they are hard to measure, then happily justify their desire to expropriate from the common man precisely BECAUSE they ignored these forgone opportunity costs. I am unable to fathom whether it is by malice or error that these ideas persist. However, failings aside, the anarchic research program has made it possible to undermine the assumed “calculative” necessity for government as we have envisioned it for millennia and to replace that error with a superior “calculative” tool of cooperation – capitalism. But the continued attempt to ignore the forgone opportunity costs and focus only on money costs, is simply an attempt at the deceptive theft, by fraud, not trade. Let me repeat that: A statement that relies upon property rights rights, but is SELECTIVE in the definition of PROPERTY, and specifically to apply infinite DISCOUNT to forgone opportunity costs, is FRAUD. Period. Either all costs are opportunity costs or they are not. Selective attribution of costs is simply FRAUD. This statement will have, or should have, as much an impact on libertarian thought as did natural rights. And if it does not, then there will cease to be a movement. Because the reason that conservatives and libertarians fail to achieve significant political success is that they have failed be able to articulate those elements of their framework such that they can provide a POSITIVE solution for humanity, rather than a resistive one. And in particular, the argument that says we must rely on the MORAL position of libertarianism is simply a TRAP so that we can further ignore the forgone opportunity costs paid by all people in a society. Instead of a specious moral mandate, the problem is one of coordination, and as a problem of coordination among large numbers of people, where there senses are inadequate to provide needed information for decision making, the answer, rather than moral, is ‘calculation’. Because ‘calculation’ is the only means of extending our perceptions such that we can make increasingly complex decisions. Even if the ‘number system ‘ we use consists of time and property, and the numerical system we use is to gain efficiencies in perception on the use of time and property. From this standpoint, Mises and Hayek are not opposed. They are both inadequate with Mises solving the individual cost problem, and Hayek solving the opportunity cost problem – albeit in terrible and ineffective terms. Rothbard is inadequate as was Mises. Hoppe took us farther and compensated for some of rothbard, almost breaking out of the Rothbardian limits and simply returning to the problem of incentives and knowledge. We have spent a century trying to use money as our sensory system and means of analysis. Mises created or at least elaborated on a theory of action, while missing the underlying economy of forgone opportunity. Hayek and Popper dealt with the problem of ignorance. Pareto and Weber dealt with the problem of knowledge and bias. Parsons did his part as well. But these men all failed. Instead, the answer was sitting there in the socialist calculation debate. What surprises me is despite the obvious nature of that answer, and the predominance of misesian thought, that the history of human political operation has not be rewritten to accommodate it. “The greatest forgone opportunity cost is by the strong, who do not simply conquer the weak, but instead demand tribute for their institution of property rights as their lowest cost means of profiting by handling exceptions.” Individual property is the result of the defensive tactics of the fraternal order of soldiers and the need to enfranchise the population. This is the very opposite of the religious dictums proposed by all to many libertarians. Peace and property are the result of the use of and organization of violence. The state is the application of organized violence. It is the abuse of that violence by members of the state to steal from the forgone opportunities for violence that have been paid into the wishing well, and paid for, by constant recapitalization, the institutions and habits we call freedom, and it’s calculative tool, property rights. The question is not what happens with one man on an island. It is, should a thousand of us be put on an island, what happens? Island myth is false at it’s outset, and therefore all that follows is false as well. Again, since I learned more from these people than anywhere else, and I believe desperately in their mission, and I respect them immensely and call a number of these people friends, I am not criticizing any intention or character. I want to advance that mission. But to do so I think that the Misesian-Rothbardian error needs to be corrected for libertarianism to provide the intellectual leadership that conservatism needs, and to finally offer a positive solution to compete with the utopianism of the socialists. Curt Doolittle

Over on the IEA Blog, Eric Masaba asks the question: Why do black cabs cost more than Concorde? I couldn’t point out ALL the holes in this article, because the IEA blog limits the number of characters per comment. I find the argument for the virtue of brevity a ‘cute’ one because affirmations are the most brief of comments, while refutations are the longest. The state subsidizes the ‘Black Cabs’ of London.

Hackney cab drivers inexplicably enjoy a rule stating that no one else can describe a taxi service as a “taxi” in their marketing, and the important restriction that no one else can pick up passengers on the street. These regulations have deep historical foundations, dating back to the days of Dick Turpin. In today’s world, they are anachronistic, anti-competitive and pointless.

London cab drivers are a pleasure to deal with. They are an intrinsic part of the tourist trade. The Danes pay an entire social class to stay home so that the average clerk in a train station is educated, literate, well mannered, and a pleasure to deal with.

When there are price comparison sites for insurance, airlines, hotels, holidays and office supplies, where we can buy the same product from a myriad of suppliers at different prices, how is it that there are very strict rules requiring that Hackney drivers receive a minimum wage for every mile driven yet private hire drivers do not?

Because the market is an unlimited physical space and the streets of London are a limited physical space (and the tube is a monopolized space. And therefore Cabs require a very simple set of regulations in order to maintain quality.

Why is it good for certain stripes of taxi driver to be able to oblige people in London to pay higher rates than the market would support if such a law was not in place?

Why is it a good for the state to regulate any kind of competition?

Why do the same drivers, who expect to be able to choose what clothes they wear (and how much they pay for them) and which airlines and car insurance firms they use, want to deny travellers in London the basic freedom to choose another vehicle service they can hail at the airport or on the street?

They don’t. You can hire a car from the airport. You just can’t pick someone up on the street.

If people want to pay for the superior knowledge that the Hackney drivers clearly possess, they will do so. If they do not care, they will find cheaper alternatives until the market has informed the black-cab community what customers really think and what price they are willing to pay.

They are not paying for the knowledge. The state is using a knowledge criteria to create a hurdle for market entry. Just like they do for just about every kind of specialist.

Many people are disgusted with the special treatment bankers received, but through the price controls and regulations on taxis in London, transport markets are being distorted to favour one type of vehicle provider.

Bankers recieved special treatment because the state printed money without regulating it and forced banks either to compete for profits or to go out of business. This process of moral hazard created large banks that are pseudo governmental agencies, that were so responsible for subsidizing the national payroll and cash disribution and management system that if they were not rescued then the crash would have been worse. On the other hand, the state CREATED the moral hazard. But it did not have to. The problem has been that creating the ‘rules’ of the fair game in banking (defining the properties of property and it’s rules of transfer) has become extraordinarily complex because the object of definition has become exceedingly plastic. Derivatives and new financial instruments were a new form of property that many of us decried at the time, but that was unregulated because both the state and the purveyors of these new devices foolishly bought the argument that it was possible to insure that kind of risk, and secondly, because So, I have to disagree with the IEA’s position. Travel to NYC, Chicago, LA and ask yourself if the London policy is better or worse for everyone involved. And if we subsidize transportation like subways why cant we subsidize Cabs. If price is a concern, then If you want another choice, call a less expensive cab company on your cell phone. Prices aren’t everything. In fact, low prices and full competition in a market often accomplishes the lowest cost service at the lowest quality that is tolerable by consumers, and bars quality from availability within a geography. (Home Depot and Walmart in the US, and superstores versus butchers, bakers and the like in Europe). I am happy that superstores exist to provide additional choice, but only if there is a replacement ‘tax’ for using them by distancing them. From this simple analogy of taxis and tubes versus superstores and specialty stores, we can illustrate that reduced prices and a free market within geographic boundaries produce commodities, and thereby prevent societies from capitalizing long term values of aesthetics, choice, and the ‘special’ environments we adore across all of europe in favor of a bland, disposable environment. We restrain competition in order to raise prices and therefore concentrate capital and we do it in many ways: political subsidy (money transfers like taxation, redistribution, and outright subsidy) constraining the market by qualification (lawyers, doctors and london cabbies), and constraining the market with monopolies (public transportation like Tubes and Buses). We unrestrain the market to reverse the concentration of capital and to reduce prices, and we do it in many ways: political subsidy of The natural order of man is to attempt to circumvent the market. The free market is a byproduct of the civic republican tradition’s advocacy of meritocratic equality. It is a rebellious movement against the control of markets and the expropriation of wealth by the state. Markets are a solution to corruption that asks us to create fair competition among equals and to maintain that set of ‘rules’ we call “competition in the market”. However, the natural behavior of man is to circumvent that market. The means by which he circumvents it are those tools we consider fair market competition: reducing prices, increasing choices, advertising and marketing. Not all cultures have taken this route. In fact, in history, the free market is an exception that concentrates wealth in hte hands of the monied, productive and creative minority. THis concentration benefits all by decreasing prices for nearly everyone. It limits the power of capitalists as long as there is enough money in circulation to create inexpensive competition. But since the culture or state determines the definitions of property (the means of calculating the use of opportunities to act) the rules for any ‘game’ are particular to that game. Rules are not universal to all games. They are plastic. And this comparison of Taxis to Tubes is perhaps one of the best ways to illustrate that these rules are inconsistent. But what may not be obvious is the DISTORTION that is created by the myth that rules must be equal for some things and unequal for others. Or, that lowest prices are the ultimate virtue to be sought by economsts and political economists. As a libertarian, I care that the choices available to me are not constrained by Concentrating capital attracts talent to the private sector where it is skimmed by private individuals, and those who lack talent to the public sector where it is skimmed by bureaucracy. Yet this is what most cultures seek to impose: expropriation by the bureaucracy. WE also constrain capitalists, and unconstrain capitalists. Capitalists can temporarily distort a market by applying capital that profits one company or anotther, requiring competitors to rely upon capital or depart. They can do this by simply extending debt, so that prices may be decreased in the anticipation of driving competition out of the market, and later increasing their share of the market as these competitors disappear. the problem with this technique is that talent accumulated in the industry is sometimes forced out. Niches are abandoned (the wall mart and home depot effect). The state acts like a disruptive capitalist creating temporary price decreases in return for decreased niche services, and in doing so makes it impossible to concentrate capital in niche excellences. It makes it impossible to subsidize a public good: choice of the more expensive, better, prettier. The purpose of the London cabbie is largely to create a public ‘good’. It enforces quality so that quality personnel can afford to work in the industry (rather than the horrid service, delivered by the filthy, ignorant and incompetent in US cities). Prices would drive down quality, and all that will happen is that you will need additional regulation to managed an impoverished and corrupt network of marginal businesses that deliver cheap but intolerable service that prevents quality competition from competing in the market. If you are willing to spend money on the tube. You have no argument against spending money to maintain a quality system of taxis. Just because market mechanics are POSSIBLE for taxis and IMPOSSIBLE for tubes, that doesn’t mean that taxis are not serving the same function as tubes. Lowest costs does not generally create a good. It creates a marginal enterprise. Aesthetics are forms of capital that are perhaps, the best investment that any civilization can make. For a country like the UK, whose history is an industry, you’d think that such a principle would be better understood. For a country that is creating demand through immigration, cash by selling off it’s assets, and the illusion of prosperity by dilution, inflation and redistribution, rather than by increases in productivity, it is understandable why a myth of exceptionalism would be a useful distraction from the fact that the UK is selling off its exceptionalism and it’s heritage, and would do even more so along with it’s taxi subsidies. Prices alone do not a world make. The purpose of the market is exploration. The purpose of unbridled market is prevent government exploitation. THe purpose of the regulated market is to capitalize SOMETHING for a social good. And not all social goods are consumables. Some social goods capitalize distortions to create beauty, which is a high return for a society, as all monuments, arts and architecture demonstrate. So, instead of universally pursuing consumption as an ultimate good. Instead of the keynesian virtue of spending. Perhaps we should balance our capitalist strategy with the art of saving. It took english civilization a very long time to create a culture of saving, and the institution of interest, so that the middle aged could save until they were old, and the old could lend to the young, in a virtuous cycle of investment that distributed the risk of long term calculation across a vast number of people, and wherein retirement security was an insurance scheme for the underclass rather than a mandate of the majority. This virtuous cycle was undermined. Perhaps we should return to it, and to other forms of capitalizing our civilization, so that we leave something behind for our heirs rather than the record of a visitation by locusts. Subsidizing quality is the entire point of aesthetics and the arts. And capitalizing everything from street signs, to cabbies to historic buildings to libraries and museums is an antidote to anti-historicism.

Another Empathic Appeal for the poor on NewsJunkiePost.com, entitled, Poverty: Half The World Lives On Less Than $2.50 A Day Unfortunately, the first prerequisite for prosperity is to control your population’s breeding. The worlds problems are not ‘density’ or ‘pollution’ or ‘capitalism’ but the transfer of life-extending technology to peoples who do not the cultural ability to control their breeding without the limits set on life by agrarian food production. For thousands of years, food production and disease gradients have limited population for people who lack the personal and social technology to control their birth rates so that they may stay within their productive means. Then we in the west, in our compassion, and in our lust to profit, sell these people life extending technologies without demanding that they control their birth rates. Were we to distribute all the wealth of the west to these people they would simply consume it and would match their reproduction to all increases in production, impoverishing the west as well. The division of knowledge and labor, the resulting increases in production, and the virtuous cycle of lowering prices because of this increased production are only one half of the equation. The control of breeding in the (protestant) countries is the other half of the social problem. More countries need a one-child policy, and the infrastructure to support that policy. Unfortunately, corruption is so rampant in these breeding-centers. Thankfully the rate of capitalism’s transformation of the world from agrarianism where children are a productive asset, to industrialization where children are a very high cost, is slowing the overbreeding problem in the ’second world’ of organized states. Incorporation of women into the workforce further controls breeding, and often too much (Japan and Russia). The reason we need women’s participation in the work force, especially in poorer countries, is so that they do not breed their civilizations into permanent poverty. The problem isn’t money. It’s cultural discipline. If we are going to even discuss mobilizing states to correct poverty then we should mobilize states to control breeding. Otherwise, along with our technology of life extension we are simply handing a murder weapon to a madman. “In other words, in 2004 about 0.13 percent of the world’s population controlled 25 percent of the world’s wealth. If we consider the global spending priorities of 1998, the trends were already extremely alarming.” Most people who read have heard of the 80/20 principle. Which means that 20% of the people control resources. This principle was developed by Vilfredo Pareto, for whom it’s named the “Pareto Principle.” He used quite a bit of data to show that in England in particular, 20% of people controlled about everything, and that income was rewarded accordingly. This also supports the value added by people. Despite our rhetoric of egalitarianism and equality, the top third of people are more productive than the bottom two thirds combined. And, at least it appears, that the top twenty percent are more productive (have more impact on generating goods and reducing prices) than the rest combined. The problem for any society is allowing the most productive people to concentrate sufficient capital that they may raise the population into prosperity. After which it’s possible to implement programs of redistribution. you can’t share what you don’t have. Unfortunately, the only value most citizens have in an economy is to provide menial labor and to consume goods and therefore create demand for goods and sevices. Imbalances in assets are needed to allow the creative and productive members of society to concentrate capital (which is the ability to influence others in an organized fashion) so that productivity can be increased. There is no record in history of this system of wealth concentration being abated. If it IS changed, then the vast majority of people on this earth will rapidly die. The problem is instead, to control reproduction and to increase production and continue the ‘virtuous cycle’ while we live within our means, so that we can redistribute something on the order of 20% of our wealth to those who have EARNED that right by the cost of forgoing further reproduction. In other words, you EARN redistribution by controlling your breeding.

The conservative movement lacks skill in articulating it’s position. It does so because it has shifted from the intellectual debate of the 50’s and 60’s to the emotional debate of the post 60’s era. It has, unlike the libertarian movement, failed to provide a vehicle for educating conservatives with POSITIVE statements rather than negative castigations. Conservatives have largely failed to develop a language and ‘scripture’ because they do not have a solution other than to return to the nineteenth century classical liberal model. That model will never rise again. It only occurred because government was very weak, and the individual entrepreneurial need to expand and populate the continent required both private ambition and private capital. It required the conversion of resources into taxable resources, which would empower the government. Conversion requires business people the way conquest requires soldiers. And therefore commercial society was in control during that period. Our current problem is not to convert land into taxable assets. It’s to maintain the international system, and our ability to financially manage the international system. We have been paying for it by trade advantage for some period of time, and then selling dollars for the past forty years. Liberals do not want us to maintain that system but they want the rewards that come from it to be redistributed. Conservatives object to this position. Neither really understands that there is no american exceptionalism except american military exceptionalism. Our future problem is that in redistributing the wealth of that military network of trade and banking we have directed too much of the profit to bankers and not enough to the citizenry. Conservatives do not like this privatization of wealth any more than liberals do. But most importantly conservatives do not like being castigated and treated as Being conservative simply means taking a gradual approach to social change and particularly with respect to the financial, family and military traditions. It means being skeptical that our visions of the future will come true, and looking at the world as what people ACTUALLY DO not what we WISH they would do. We as a nation are notorious for predicting an optimistic future that cannot or has not occurred. The dialog around our prosperity is often inaccurate and self-congratualtory rather than factual. We have transformed our culture of evangelical christianity into one of evangelical democratic secular humanism. Conservatives are skeptics. They may speak in antiquated language, because that is their language. They may fail to articulate their position effectively because of that language, but they ACT conservatively, think conservatively, and treat the world conservatively. This is why conservatives are, in general, more prosperous – and frankly, happy. And the sacrifices that they make in order to be prosperous are material to them. They remember them. And therefore they resent those sacrifices being ‘spent’ by others who do not make the same sacrifices. Monetarists and capitalists are not conservatives. They may hide under conservatism. But they are not conservatives. The conservative class is a military, middle and craftsman class and it always has been and always will be. It is the ‘residue’ of the european fraternal order of soldiers at the bottom, and at the top, it’s a ‘residue’ of the middle class movement that revised and adopted civic republicanism during the enlightenment as a way of transferring power from the kings and church to the middle class. it is an alliance of the military and middle class. Liberalism (socialism, communism) is a ‘residue’ of a union of the priestly cast and the peasantry. Academia is simply an outgrowth of the church. The peasantry has always allied with the church, and the church has always had power because of it’s support by the peasantry. And that said, we do not have a separation of church and state. Our state religion is now democratic secular humanism. We are now a state-run-religion using the myth of division of church and state to oppress (or reform) religions so that we can have a state sponsored church. That’s it. That’s the articulated conservative position. The republican party collects conservative coalitions. The republican party is not a conservative party. conservatives join the republicans because they have no choice. They see the party as corrupt. People are complex and only join parties because of limited choice mandated by our ‘winner takes all’ form of government, which fosters class warfare. In fact, all political decisions exist on a spectrum or bell curve. There are a myriad of political decisions to be made. There are a myriad of people with different abilities to understand each political opinion. Each person is interested in a myriad of decisions. Parties are collections of people with opinions. Very skilled people tend to be highly unsatisfied with party choices. Very unskilled people tend to simply support their party of nearest interest. Parties therefore pick platforms that make enough people happy that they can get into power. arguing that conservatives want to keep things asa they are, is a silly argument. The objection is simply illogical. The question instead, is whether liberals propose a solution that conservatives can live with, and wether conservatives can propose a solution that liberals can live with. If we had listened to the liberals in the last century we would have ended up like either Russia or China. If we had listened to conservatives we would not have had our progressive social changes. It’s the competition of ideas that gives us the choice as a body politic.

Rebekka Grun, on The Growth And Crisis Blog writes that we could have protected the consumers rather than the banks, in her posting Conditional Individual Bailouts – a Potential Anti-crisis Instrument

Why not save the individuals that went bust rather than their banks? Unconditional bailouts, of course, would generate the wrong incentives (for the banks as well, by the way). It is therefore important to attach smart conditions to discourage free riding. For example a course in financial literacy and commitment to a program of (maybe painful) debt restructuring, and possibly further measures to improve the education or health of the affected individual or family.

Your sentiment is correct even if you haven’t done the math on it. In general terms, there is a simply technique for doing exactly what you’ve suggested, but we lack the infrastructure for it. The arguments against the solution at the time were that we didn’t know how far prices would fall (I’m not sure, I think we were about right), and that it would make very visible that the government was the source of the problem (true), that it would have geopolitical impact on the value of the dollar (of course, but so would the alternative), and that it could be unfair to people who had behaved well (that would be fixable), and that it would encourage a bubble (this is false). THe primary problem with distortions is that the distortions are in PRICING. Libertarians would call corrections ‘repricing’. The problem is that human beings must suffer a great deal and absorb a lot of stress to conduct that ‘repricing’. When the state, as the creator of the distortion by the manufacture of cheap credit, could easily reprice major (home) assets by repricing the DEBT of those assets. In other words, we could have easily corrected the economy by bypassing the banking system, and giving money directly to the citizenry as buy-downs on their mortgages, which would have provided them with cash to spend or to put into banks. Doing this is fine if you do it FAST. In other words, the state created both the BOOM problem and the CRASH problem because it relies on the irresponsible tool of providing general liquidity – easy money. In hindsight this is more obvious than it was at the time. Those of us who made this recommendation were the smaller voices, because the banks and the financial industry were so terrified and the impact on the economy if they failed, so severe. The problem for our country is to put this system in place, so that we are insuring citizens AGAINST their bankers, so that we can use the market to PUNISH bad bankers and their investors, rather than the citizenry. I’ve worked the mechanics of this process out in some detail, and it’s quite simple. It’s just novel. And it’s anti-bank. And that makes it dangerous to a lot of people in one of our biggest industries: finance.

I’ve purchased two books, this one “Adam’s Fallacy: A Guide To Economic Theology”, as well as “Economics As Religion: From Samuelson to Chicago and Beyond”. There are any number of books on this theme. Note: This book was a waste of time and money. It is a silly marxist pamphlet. I can summarize it as “poor people breed too much and capitalism doesn’t care” when in fact, capitalism simply makes it very expensive to have children and those who breed irresponsibly are punished abstractly by enduring poverty rather than forced by village and tribal elders to leave their child exposed and dead. The vast silliness of the logic in this book is unworthy of further commentary. I’m surprised that this notion of economic religion is not more commonly discussed in the venal press. But it is too valuable a tool of those who wish to empower a democratic state and it’s politicians who are, quite frankly, at a loss to apply something other than the practicalities of getting elected, or the mysticisms of our founding documents, christian religion, or marxian fantasy. I start with Adam’s Fallacy. Using the KIndle edition on a mac, and therefore cannot annotate in place, and am not sure of page numbers. (This is a problem we need to fix, because we’re going to increasingly use dynamic text, which requires paragraph numbering not page numbering. Anyone remember wordperfect versus word?) PREFACE I am not sure I buy the argument that smith created a fallacy by separating market life from personal life. The Wealth Of Nations (TWON) is only the second half of his philosophy. the first is The Theory Of Moral Sentiments. (TOMS) They together represent his insight that the division of labor increases production and that human sentiments to cooperation at both the intimate, interpersonal, local, social and global level. While we are only in the preface, I’m not sure I buy the assumption because it’s too loose an assertion. Instead, I blame Knight and Keynes. Smith is nothing but a moral philosopher. “Contemporary economics has grown into a major intellectual industry” I hope this is elaborated further because it’s the the same problem presented by the clergy. People depend on perpetuating the faith. “Teaching economics reinforces the world view I call Adam’s Fallacy”. I don’t think so. I think that’s the crowd post 1900. “Teaching students to think like economists .. is hard.. and thinking like an economist … is just as value laden as any other way of thinking about society”. The idea in economic reasoning is the broken window problem: the need for all humans to think in terms of secondary causes and to follow the chain of secondary causes. This teaches people to think more deeply about the trade offs of both personal and political decisions. Yes it’s hard for people. Otherwise we wouldn’t need a market. CHAPTER 1 “The moral fallacy of smith’s positin is that it urges us to accept direct and concrete evil in order that indirect and abstract good may come of it.” Well, now, we need a definition of evil, don’t we? “neither smith nor … his successors have been able to demonstrate rigorously ad robustly how private selfishness turns into public altruism”. I don’t think he says that. I think he says that by participating in the market europeans will have fewer wars. CH1 – The Division Of Labor “Smith leaves unanswered the chicken and egg question of whether it is ultimately the human propensity to truck and barter that lads to the division of labor, or the division of labor that compels people to exchange.” Isn’t this a false dichotomy? People have always bartered and exchanged. the division of labor is simply more profitable for the individual. Ask any art-jeweler or craftsperson, who starts out producing one offs, but determines that quality of life depends upon his or her development of a product line that can reliably produce revenue, so that she is free to create those individually interesting pieces. The VIrtuous spiral of economic development. “Smith puts his faith in the ultimate benefits to be gained from the virtuous spiral to in crease standards of living and enhance the wealth of …. the sovereign.” “Smith SAYS LAW “… rise in labor productivity has at least one immediate and negative effect: a reduction in the demand for labor in the industries undergoing raid rises in productivity. …. unemployment can result.” “thus say’s law is based on a belief in the efficiency of the financial institutions of a capitalist economy” I don’t think so. I think it’s based on the belief that no other alternative is available while retaining the productivity RELATIVE to other nations, so that wars can be averted, and we can overcome the myth of the fixed-pie. “some of these displaced workers will eventually find alternative jobs” Yes, they will. They just might not like them. The alternative is that people should subsidize workers to produce goods at increased cost of goods to themselves and/or that the entire enterprise of production that employs ALL workers will fail to compete for market share against people from OTHER nations. In other words, it’s the smallest of three evils. “It appears that over long periods of time, says law does operate” Well, of course it does. At this point I’m frustrated because I don’t understand the problem. I know marxian fantasy must be in here somewhere by now. THEORIES OF VALUE I cannot for the life of me discern what point he is trying to make here. MARKET PRICE AND NATURAL PRICE Well, since the time of smith we understand that the labor theory of value is flawed and we have dismissed this part of smith as an error. So I don’t see this as material. he states in many more words ,that natural prices and market prices are in disequilibrium at all times. This makes no sense because a natural price is a tool for us to use to conceptualize movement, and a market price is a thing that comes into existence. So far either he is trying to accumulate a later argument or he’s simply confused. “contemporary economics on the the hand, focuses more theoretical attention on the the ideal imaginary state of equilibrium where market price and natural price coincide.” At this point he is trying to build an argument upon a falsehood – the labor theory of value and natural price. I hope that this is going somewhere. Either that or he is trying to state that the DSEM construct is a myth, and we all understand that it’s a myth. There is no bell curve. There is no equilibrium. It’s just a construct we use so that we can apply math because without that construct we CANNOT apply math. WAGES “… wages have the social function of allowing workers to reproduce themselves” (he means have children). “In order for wages to perform this function, they have to be high enough to allow workers to buy a subsistence standard of living” Ok, so this is supposed to be that the poor have the right to breed? So when did this become a social good? the problem for mankind since industrialization is that people simply don’t die, and they’re expensive. Our problem is overpopulation not supporting the unproductive people’s fantasy of unrestrained child birth. “Smith associates high wages and a high workers standard of living with a growing capital stock” Yes, I agree. at this point I understand that he is providing contemporary context. I read the rest of chapter1 and move to chapter 2 in the hopes that he is going to provide some insight here. Note to authors. Make your premise first then prove it so we don’t have to guess our way through your fantasy. FAR AHEAD “Behind this…. lies the unpleasant truth about capitalist social relations. The organization of the social division of labor through commodity exchange and wage labor systematically inverts the ordinary logic of human relationships.” What logic is that? That people have not exposed children for years, or even outright murdered them or sold them into slavery if they could not support them? In fact, breeding differences account for large differences in the prosperity of difficult cultures. So is this the author’s point? That he has some fallacious concept of the ‘right to breed’, instead of the ‘responsibility to only breed a child you can afford to feed?” Then he goes on to say that marx systematically breaks down and…. helps us understand. What he does instead is create a system of justifying primitivism. Look. We converted from hunter gatherers to farmers. We figured out how to control our breeding by creating the ‘family’ and monogamy. This made families economic units that could manage resources. We invented the market, and the tools of quantitative cooperation we call money, accounting, numbers, interest and credit. We increased our ability to breed further, but penalized those who have less foresight. Capitalism creates temporary extraordinary wealth then forces people to control their breeding in order to participate in the wealth. Those who don’t, suffer because of their choices. We just have a more abstract way of controlling population. ( INSERT A VAST AMOUNT OF JUSFICATIONISM OF MARX HERE. ) ESCAPING ADAM’S FALLACY “thus we cannot look to capitalism to solve inequality and poverty” That is correct. WE can only look to capitalism to provide the incentives for controlling reproduction so that the poor do not doom themselves to perpetual poverty in a world where children do not provide security or comfort but are a drain on resources. In other words. This is a silly marxist book, and I wasted two hours reading it. The chinese solved it with the one child policy, and it was a good policy and successful. Rather than redistribute ourselves into mutual poverty and regale the thought leaders of the past, you could simply write a book on the value of the one child policy, or at least, pay men and women to sterilize themselves. Capitalism makes poverty a choice of reproduction.

Bruce Bartlett, who is a well known conservative, tried to pitch tolerance to conservatives, and in doing so proved he fails to understand conservatism. I left this comment on his web site:

Bruce, I want to let it pass, but I simply have to contradict this column of yours, even if I agree with it’s sentiments. You (and Boaz) are confusing language with content. (This is the same mistake religious fundamentalists and their critics make. It’s an endemic human error.) Slavery was not the reason for the civil war, the fact that the south paid for the government and could block the north’s initiatives was the reason. Lincoln only changed to ‘slavery’ to get popular support. Slavery is a bad economic model and was in decline, and would continue to decline. Every economist in the world knows this. It’s not about airbrushing slavery. It’s about social status, political power, costs, and ‘the long run’. Denmark is a small homogenous society that has imported a labor class and has yet to experience the degree of friction that empires face when they merge cultures. Denmark literally pays a third of the poulation to stay home so that they wont disrupt the real people, and so that you can talk to an educated person in train station. They pay their poor and ignorant to go away. Homogenous societies are more generous and egalitarian. They can afford to be because political power is something that they have a grip over. The same is true for small societies. Comparing small communities of protestant nordics to the vast body of the world populace is either disengenuous or simply stupidity. The italians in the south are a corrupt and lazy people. THe north know this. They hate supporting them. The north chinese rule the prosperous Southern Chinese. The south hates this. American conservatives don’t like it for the same reason. And, we aren’t nordics. We’re romans. Freedom expands elsewhere? You mean capitalism spreads because it is a superior social technology. However, the vast body of the world is in the process both as an intellectual movement, an as a material political force, to totalitarian capitalism. We may live in the illusion that democracy is meaningful, but it’s actually property rights and fiat money that make a nation. Our ability to expand has been under the force of arms. Not under our graces. Democracy if it persists another century, will be an oddity of northern european civilization. And there is no record in history of democracy enduring, and there is no rational reason that it should. It’s a bad system of government for anything other than a city state. Freedom is maintained by a freedom seeking minority of the population that is willing to use violence to perpetuate those freedoms. That is the source of freedom. It has been the source. It always will be the source. Most people want the fruits of freedom. But freedom has always been and always will be a desire of the creative minority. You are confusing FREDOM FROM nature, and FREEDOM TO act. I’ve written a longer posting to you about this, because it warrants it. But freedom is a specific term that has to do with human political organization and the use of property (life and property). The other ‘freedoms’ allude to are ***ANALOGIES*** to freedom. They are forms of security, safety, and reinsurance. They are not freedom. They are the RESULT OF THE PROSPERITY GENERATED BY FREEDOM. In this comment, and in my posting, I have tried to correct each of your points as erroneous attributions of causality, in an attempt to provide a better understanding of conservative sentiments, and to express those sentiments as a rational economic philosophy. “Conservatism is an economic strategy for group persistence on a longer time frame by a military class using sentiments that represent material economic costs.” This is a long article, but it is a topic that requires explaining a number of issues that are poorly understood for historical reasons. Conservatives need a language to express their complexity. That language is in economics and sociology. The problem for any intellectual is to create a system of thought that can be expressed by people who can only understand those sentiments, people who are more critical of them, and those that an completely articulate them. Conservatives need to understand themselves in something other than metaphorical language in order to compete with short term thinking secular humanists. And even with well meaning but erroneous conservatives who only serve to make the problem worse with their acquiescense and justification. Four thousand words is the best I could do. http://www.capitalismv3.com/index.php/2010/04/contradicting-bruce-bartletts-fantasy-of-american-exceptionalism-and-good-government/

Bruce, I want to let it pass, but I simply have to contradict this column of yours. This is a long article, but it is a topic that requires explaining a number of issues that are poorly understood for historical reasons. While you might attempt to say ‘government has more goods than bads, Conservatives have material objections that, in the end, they feel will result in the elimination of the ability for government to deliver ‘goods’. 1) The accumulation of political power by the state in opposition to the civic republican tradition of denying the state power. 2) Using immigration to disempower the ‘group’ as they perceive it out of political power 3) Giving others extraordinary rights at our expense in violation of the civic republican tradition’s mandate for equality. 4) education biases against us, in violation of the civic republican tradition of meritocratic outcomes. (“Why can jews take over harvard but we have to be restricted by quotas”, for example.) 5) job biases against us 6) abuse and derision by public intellectuals – who have disempowered the churches in favor of the religion of democratic secular humanism and are now mandating their religion as the new social order. 7) redistributing our wealth, in particular, favoring immigration over retirement schemes. The state undermined another pillar of civilization: the mandate to save rather than consume. By liquidity and taxation we are permanently impoverished in old age. Income taxes should be instead be based upon balance sheet wealth so that men can be independent in retirement. 8 ) asking us to sacrifice our productivity to pay for what we don’t believe in. This is the definition of oppression. Democracy is not a vehicle for justifying oppression. It’s a means of peaceful transfer of power, and a means by which peers can choose among opportunities for mutual benefit. When it becomes a means of oppressing one group for the benefit of another, and in doing so empowering government, then it’s simply oppression and no amount of ‘common good’ changes that oppression. 9) undermining the family structure which is the basis for our entire society. Giving people property rights and access to capital is one thing. But undermining the family, and effectively, enslaving men through divorce and child care law is not equality. It’s oppression, and it has made it too easy to enter a marriage, and too costly to exit it. (and yes I can debate the statistics on this with the best of them.) We reward malcontents at the expense of people who have discipline. THis is offensive to conservatives who only want a level playing field. 10) building a victim society instead of a meritocratic society which is against the principles of the Civic Republican Tradition under which it is assumed that we give authority to the state in exchange for not TAKING that authority ourselves. And that is what conservatives DO. They give their authority to the state. (Authority is a proxy word for VIOLENCE.) Why? Because conservatives are Pareto’s ‘Residues’ of the military social class – the last remnants of nobility at the top, and of the soldiery and craftsman class at the bottom. THey operate by the concepts of duty, which they see as indirect payment for the social order. They are the remnants of the Civic Republican Tradition. The one cultural advantage of the west is it’s prohibition on corruption, and this class is the originator of that tradition. If all nations are organized by corruption, then the most wealthy are those with the least of it. The military class is what obtains and maintains trade routes, and what obtains and maintains land, and therefore what obtains and maintains resources . Trade routes and land are the source of prosperity. Not everyone can be switzerland so to speak, and switzerland and singapore are outliers. Essentially conservatives object to profiteering by government at our expense while demonizing our objection to their abuses. Government is the equivalent of a priestly class that lives under the protection of conservatives and by their effort and labors while deriding them and encouraging the beggars to steal from them. I can enumerate these causes of government abuse ad-infinitum. Even if most conservatives cannot articulate their positions in the temporal language of secular humanism, I can. Conservatives have not had enough time or worked in sufficient numbers to develop a competing political language to that of the religion of secular humanism. In fact, to some degree, doing so is antithetical to their dictum of “actions not words, since words are deception”. As such they are trapped in historical metaphor at the top, and religious metaphor at the bottom. These metaphors can be restated rationally, even if most conservatives lack the ability to do so. That doesn’t mean that such a language cannot be developed, despite Mises, Hayek, Popper, Parsons and many others having failed. It just means that as a group that seeks “group-persistence-over-time”, the language that they must employ is necessarily historical and strategic rather than temporal and tactical. Simply because our academic understanding of politics and economics is lagging so far behind our scientific language, and our history, literature, religion and myths are all an impediment to correcting that deficiency. Our wealth, and the ‘goodness’ of government that you casually attribute to the state, is not from the state, but from the freedoms FROM the state. In contrast to your correlations, I’ll enumerate the causations: The real sources of American Prosperity? 1) English Common Law, which facilitates individual property rights, which facilitates human calculation of opportunities. Wide spread use of accounting technology that facilitates calculation of opportunities and costs. Wide spread contract dispute resolution. This law was not made. It evolved. The king could not write laws as we mean them, until recently. He had to rely upon common law. 2) The civic republican tradition awakened in germany as a reaction to the search for freedom from the dominance of Mediterranean civilization, it’s culture of corruption, and it’s trade routes. That german awakening was then distributed by way of english naval dominance. 3) The movement of trade to the atlantic so that we could exploit the newly discovered continent, and the increase in wealth given to the northern european naval nations over the more sedentary competing civilizations of the east. And in particular, the militarization of the entire english nation into what we call Merchantilism, or the corporate state. Ths allowed officers to move into business and expand business under state sponshorship. This mobilizes the vast amount of ‘individual computing power’ when combined with sound money and granular property rights. 4) Plentiful money so that we are not constrained by the availability of money. Contrary to most libertarians who want to expropriate money into the capitalist class, the military is what makes trade possible, and money is borrowed from the citizenry – else we have what libertarians desire, privatized wins and socialized losses – expressly against the civic republican tradition, as well as that of all other civilizations. (this is what we have been doing by the way – privatizing wins and socializing losses. Instead, we should bypass the capitalist class the way the swiss have but that’s another topic althogether.) 5) the importation of vast numbers of people as we sold off this newly discovered continent while giving them political power before they were self sufficient. This is the real reason why the property qualification was valuable. It prevented the importation of people who could empower the political class and allow it to extort money from producers. 6) the concentration of capital made possible by selling off the continent. This has been the greatest land grab in history. 7) the funding of a military bought cheaply and at a discount after the world wars, by the profits earned by selling off a continent. 8) the use of that military network to take over and expand trade routes, banking and the ‘international financial system’ that made american ‘currency’ a necessary commodity for world trade. 9) This export of ‘money’ has been our fee for creating and exploiting that world trade system. it is the source of all our wealth since the great depression. THe imbalance of power has led to an imbalance of wealth that has been in our favor. THAT IS THE SOURCE OF OUR GOOD LIFE. PERIOD. The ENTIRE world knows this. They understand the myth of american exceptionalism even if we don’t. “The west dominates the world because it westerners are simply better at war, not because they are more virtuous.” You can find this statement or an equivalent in the literature of every civilization. In particular, in the literature, worldwide, for the past decade, has been coalescing an argument against western democracy as something peculiarly western. They do not take it to the full conclusion. THat we have a democracy because we are wealthy enough to have one, but that is a temporary phenomenon. We americans are wealthy because in the act of discovering a continent the wealth generated and the freedom of individuals to act, outpaced the ability for the european governments to appropriate that wealth. This led to local concentration of wealth in the hands of local ‘business people’ who then took political power and profited from westward expansion. THe increase in productivity by the late 1800’s along with the after effects of napoleon’s chaos collapsed the european economy in the first great depression and led to the franco-prussian problem, and eventually to the first world war. The further concentration of capital allowed the US to capture english trade routes and military bases and buy that empire’s trade routes at a discount. England has been a client state ever since. And the dollar the world currency instead of the pound. We are in our position of wealth not out of national character, or our system of government, or any myth of american exceptionalism, but out of english heritage and the act of selling off a continent. Conservatives, who are historical and traditional by nature, and whom have a long view of time, will take pride in any civilization wherein their status as the progenitors, and maintainers of that society are acknowledged. Conservatives seek to maintain group persistence by maintaining group advantage. This is a masculine strategy as old as mankind. LIberals seek to distribute resources for current good, rather than capitalize resources for future stress. This is a feminine strategy as old as mankind. Together they generally balance one another whether in tribal cave, clannish village, or chieftain state. The problem becomes epistemological when we get to empires. We have trouble ‘knowing’ if we’re storing or distributing enough. WE haven’t had the political technology to solve that problem yet. The first time mankind had this problem we developed writing, numbers and counting systems. The second time we developed Accounting, contracts, interest and banking. Now we need to understand that our political system has to catch up with technology. We have an antiquated political system in this country for the size of empire that we have and it is this antiquity, this antiquarianism, this reliance upon metaphysical biases and residues that is preventing us from solving the problem of reinventing government. Socialism is not reinvention, it’s re-establishment of tribalism. Democracy is not advancement, it’s a temporary tool for increasing the scope of participants in problems solving. We are beyond the ability for politicians to comprehend our problems and provide solutions. Conservatives know this. They just don’t know how to change it. (I do.) But if history is true to form, the invested interests in government, and the money in the political chain, (just as conservatives warn) is such that these innovations will take a century to implement if even possible, unless there is a catastrophic failure of our ability to maintain trade routes and the global monetary system. Government broke the boundary of moral hazard when it created fixed benefit programs and sought full employment rather than variable benefit programs and productivity increases, and in doing so converted the society from saving so that the old could profit from lending to the young to the young supporting the old, when it had taken thousands of years of human history to adopt the established technology of saving and interest. This is was social hubris on a massive scale. Furthermore the government simply SPENT all that accumulated wealth in savings, as redistribution and social and infrastructure programs over a period of eighty years. The conservatives tried to counter it but could not, and now demographically have lost the opportunity. They have been out immigrated and out bred. Americans need to stop congratulating themselves on their perceived wisdom and the virtue of their religion of democratic secular humanism. That’s all nonsense. We are prosperous because we control resources, and levy a worldwide tax for our policing of the international system. While at the same time we undermine that system’s ability to function by undermining the political power of the people who made that system possible: the military class. Americans need to have an honest conversation about the source of their prosperity so that they can have an honest political debate. without that debate we cannot have a democracy or a republic because all else is superstition, religion, absurd metaphysics and outright fraud supported by outright violence. And that’s the danger. At some point, that military class and it’s newest iteration as the small business owner, has been so willfully undermined by the priestly class’s new iteration of public intellectuals and the new religion of secular humanism, will choose to return to it’s basic principles as a military class. Conservatives may be conservative but they are only non-violent by restraint, not by choice. (Aside from the jewish contingent in the libertarian movement that failed to learn the one lesson of the hebrew bible, and it’s story of the rise and fall of Israel – that jewish doctrine is not sufficiently self sacrificing to hold land, and therefore hold a state.) The conservative dislike of Clinton was almost entirely because of his failure to understand the importance of the military culture to conservatives. When he undermined that culture, he effectively stole the inheritance of the conservatives. That we only had a few incidents of domestic violence was surprising. If he had not done that one thing, he could have emerged as a great president. The trick in this country is to be both militaristic and socially tolerant, and fiscally responsible. But our leaders lie about the source of american prosperity. It is this primary lie that causes american political friction. The West’s success versus all other civilizations, despite it’s marginalism and distance from the beginnings of the centers of civilization, has been that the military class adopted individual tactics in battle. THis led to enfranchisement. Enfranchisement led to debate. DEbate led to reason and logic. Logic to science and technology. Science and technology to And our civilization’s locus changes, from athens, to rome, to florence and Venice, to Paris, to Holland to london to new york to washington, and now to the different cities that are capitals of ‘nine nations of north america’ that make up the Washington Empire. People do not possess the necessary information to make rational decisions about political and social ends. They rely on myths. (THe alternative would be to say “I simply don’t know” which is a sin in the religion of secular humanism. There are a few people who are aging now who are wise enough to say that but the religion is so pervasive that it’s become rare to hear someone say “I don’t knw enough about such things.”) People instead rely on metaphysical presumptions and biases instead of rational information. Because of the complexity in predicting the future during periods of dynamic change (as another generation of our economists are discovering yet again), makes prediction nearly impossible due to such extraordinary complexity, people in all social classes rely on their biases and assumptions. As such, metaphysical biases and therefore, all human decision making, are made according to class judgements – ‘residues and derivations’. And for complex reasons due to pedagogical content in our families, child rearing, language, and literature, THIS CANNOT CHANGE. Class memes are relatively permanent. Most voting patterns are not due to political changes in opinion but to redistricting and immigration and breeding rates. Even for neutral policies that do not affect them, people do not change their long term biases except to generally become more conservative as they age. This is why conservatives are annoyed. THey see their sacrifices in the name of group persistence used by the government to immigrate and empower the state, and they feel angry at the theft of their sacrifices. As such, conservatives and liberals simply hold class residues that together form a division of labor, with short term altruistic goods on the left, and long term group persistence on the right. The question is not whether one or the other is right, but whether each group’s preferences are fulfilled well enough and with sufficient compromise, that neither revolts. (even if revolting is ‘leaving the economy’) The problem in the USA is that the south has recovered from it’s slumber, and the rust belt and west coasts have immigrated vast populations. Second, that the industrial heartland is NOT on a coast, and faces the same problem as does germany – it must produce exceptional products in order to create an export economy that compensates for it’s geographic disadvantage, yet the ‘residues’ in that part of teh country do not promote german or japanese quality, because the rust belt/great lakes culture was developed for westward expansion and developed a culture of cheap simple goods, not for an export economy. This can only be fixed over a generation of policy, and a political ability to articulate that policy. Democracy is notoriously bad at accomplishing these kinds of change. And socialist totalitarianism is the opposite direction. it seeks to distribute normative gains not to increase production. Macchiavelli, Weber, Pareto, Michels, Hayek, Mises and Popper all understood these things to some degree. (I think rothbard distracted the libertarian movement despite his many insights he prescribed anarchism as a means of controlling the state, rather than developing tools by which we could maintain the system of social insurance created by fiat money and the state-bank, making the government insurer or last resort.) Yet these men were unable to develop a prescription for government that solved the problem faster than the state could appropriate power under the myths of socialism and secular humanism. That is because the problem of distributed government in the civic republican tradition is much more complicated than under the simplistic tribal metaphor of centralized states. Socialism succeeds because of SENTIMENTS not because of reason. Government empowerment succeeds because of incrementalism, and a failure of conservatives to articulate a sufficiently explanatory alternative. From my position, in hindsight, it turns out that some people in the thirties, during our second great depression stumbled across it. But that in that period of duress, the state sought the short term goal of FULL EMPLOYMENT instead of the long term goal of PRODUCTIVITY, and thus Keynesianism supported socialism, and we developed the welfare state, just as did the egyptians, Romans, the Mayans and just about everyone else who ever had to run an empire. We can have our cake and eat it too. We can do it without using politics as a tool of calculation. That’s what we do now. We calculate the future of our society using democracy’s political ‘wins and losses’. By trial and error. But we don’t have to race to the bottom like all other democracies in history. We can have our cake and eat it too. We just have to understand that our system of government is from an era of shipping and trading agrarian goods, and that laws are a remnant of slave society, and that the use of politics and government is of necessity an imprecise, and fraud-producing enterprise. As has been said, “We have simply swapped a culture of violence for a culture of fraud.” Conservatives by their nature, understand this. THey see government as fraud. And for reasons that are explained in the myth of the rational voter, it is only by fraud and later justification of failure, that politicians are empowered, and only those that seek power, who seek political office. When the entire western tribal tradition has been to ensure that no man obtains sufficient power to dominate others. Now, the underlying and unstated problem here is that conservatives, as the remnants of the military class are by definition, militant. They are not a rabble. They do not like rabblery. And they will shortly, if they have not already, choose to CEASE refraining from their use of VIOLENCE. I have stated this repeatedly : “men are not equally endowed with either violence or courage. Some are capable of interpersonal violence, some of rabblery and protest, adn some of revolution and civil war.” If I forgo my opportunity for violence, I pay a cost in doing so. If I forgo by opportunity for fraud, i pay a cost in doing so. If I work hard then I pay a cost for doing so. If I am self supporting then I pay a cost for doing so. This is how our civilization is paid for – not by money, but by forgone opportunity. This is the currency of human action that pays for a non-corrupt society, and for the institution of property. That’s how property is PAID for. Not by government, but by many, many millions of forgone opportunities every day. It is THIS that funds the development of the STATE, not the state that creates property. “We have laws because we have property, we do not have property because we have laws”. THe differences in cultural definitions of property have to do entirely with the degree of familial independence needed to keep a farm or craft a good. It is not that one civilization is more charitable than another. It’s that more advanced civilizations are more productive and as such require greater divisions of labor, and as such more granular definitions of property. You didn’t think property rights were FREE did you? Or granted by the government did you? Governments simply publicize property rights – when they interfere with them they disrupt the society. Property is a very complicated technology that must evolve along with the division of labor. It is very little different from the technology of numbers or language and is just as important as science. And it is paid for by forgone opportunity. So conservatives feel that sacrifice by sacrifice they pay into the ‘virtual wishing well’ that creates society. They do this, each of them, with a thousand micro-payments a day. Then, along comes the state and wants them to pay the RESULTS of those sacrifices to the state for reasons of mutual investment. Then the state shows up and wants them to pay the results of those sacrifices for charity. Then the state shows up and wants them to pay the results of those sacrifices to empower the government, and the government says it’s not a donation, but a duty, and then the conservative looks up and says, “hmmm….. I do all these things, and make these sacrifices so that others may jeer at me and ridicule me. ” Soldiers are the source of every civilization because they are the source of it’s ethic, it’s resources and it’s trade routes. Different civilizations’ social systems are largely a reflection of their ancient battle tactics. The west is unique because it adopted the wheel, horse, bronze and coordinated tactics, which required individual initiative, and that the warrior supplied his own instruments of war. That is the difference between western, byzantine, middle-eastern, and asian cultures. It is how you use them as a civilization that affects all other classes that come after it. Furthermore any civilization that loses it’s soldier class, and in particular their motivation to act as soldiers despite the sacrifice of doing so, rapidly becomes the victim of someone else’s soldiers. Conservatives are your soldiers. They carry the meme of heroic sacrifice. The question is, how do you want to use your soldiers? This is the core of conservatism. “Group Persistence and heroic sacrifice to maintain that persistence, and the individualism needed to maintain that ethic.” And as such it is not a silly believe or an absurd metaphysics or a religion. It is a strategy for maintaining land and trade routes. And as such, is the source of not only western but american prosperity. And none other. Everyone else is just along for the ride and complaining about the scenery.

A Good Day. I wrote ten thousand words before lunch. That’s about three thousand words an hour or fifty words a minute. Sushi+2LitersOfWater+TenHoursOfSleep=Priceless. Water is better than caffeine if you’re rested.

What is it about an office that promotes so much illness? I know that offices where people interact frequently and move between locations lot, and have greater density are natural distribution centers for affection, and I know that the more time children spend in day care and in school, the more they become distributors, and I know that closed-ventilation buildings are better grounds for bacteria and viruses, but knowing that is not the same as having to lose so much time to illness. I mean, it just seems like between my son, the office and airports my immune system is exhausted. It reminds me of a conversation I had with a chinese national a few weeks ago. There is this wealthy Chinese urban activist whose name I don’t know, but he wants to design and build very dense housing for people. What I told him was that it has been thought about and tried over the past century. But the problem is that HUMAN BEINGS ARE TOXIC creatures, and second, that if you move shanty-dwelling-people to nicer circumstances, they just maintain their previous behavior and destroy it – inviting lots of relatives, and putting up sheet metal and cardboard. Now the counter argument is that chinese authorities can impose discipline that other nations can’t get away with. But Im skeptical. What bothers me as a political economist is that all civilizations to convert to urbanism die. (Jarred Diamond has it wrong. It’s an information problem not a resource problem. He has it backwards.) We don’t know how to run a largely urban society for very long because law, which is our primary social technology after religion, simply ceases to work in large cities without extraordinary costs of repression. Money and credit may change that but only if we change policy from taxation to credit the way we changed from religion to taxation as a means of maintaining social order. Human density is not the panacea our planners and utopians think it is. Density is toxicity, it decreases the disease gradient, and it leads to political tyranny and instability, and it becomes increasingly difficult to concentrate capital and therefore productivity. The problem is to balance birth rates and productivity. Not density. And no matter what we do, ‘He Who Breeds Wins.’

http://www.capitalismv3.com/I’m thinking about density. In the office. In cities. In civilizations.

http://www.capitalismv3.com/

“Human density is not the panacea our planners and utopians think it is. Density is toxicity, it decreases the disease gradient, and it leads to political tyranny and instability, and it becomes increasingly difficult to concentrate capital and therefore productivity.”