Category: Economics, Finance, and Political Economy

A PROPERTARIAN SOLUTION TO THE COMING MOBS OF PITCHFORKS – A BETTER WAY OF GETTING PEOPLE MINIMUM INCOME (READ THIS) (IMPORTANT PIECE) See http://topinfopost.com/2014/06/30/ultra-rich-mans-letter-to-my-fellow-filthy-rich-americans-the-pitchforks-are-coming (regardless of your political persuasion, you should read this. because it’s the best existing answer to the social problem of post-agrarian capitalism). [T]his might sound like a criticism, but it’s not: he “gets it” sentimentally, he doesn’t get it economically, or institutionally, because he’s not knowledgeable enough to ‘get it’ economically or institutionally. But the fact that he expresses his ideas sentimentally, is more USEFUL than expressing them economically or institutionally. Because people will not understand the importance of the economic and institutional arguments. The institutional problem we face with engaging in systematic dependency-creating redistribution is giving everyone the right incentives, rather than those that encourage the expansion of the government, which is a parasite on consumers and producers alike. The economic problem we face with creating institutionalized redistribution is doing it without doing more damage to the complex system of information provided by prices and wages. We forget too easily that capitalism refers to the *voluntary organization of production* in contrast to the various involuntary means of organizing production. The reason why capitalism produces prosperity and socialism doesn’t is because under the voluntary organization of production people have both the incentive to work and producers the ability to make rational plans under ever-changing conditions. Under socialism, people have the incentive not to work, or to work as little as possible, and it is impossible to rationally organize production to serve the desires of other producers and consumers. So capitalism isn’t a matter of preference, it’s a matter of necessity. But here is the rub – and the solution. [W]hen our governments were invented, people worked in an agrarian society where our productivity was marginally indifferent, and determined not so much by our abilities, but whether we controlled our breeding, and whether we had the discipline to work hard. Today, disconnected from the productivity of the land, no longer farmers, no longer farm workers, even if we want to work, many of us cannot, because we can do nothing productive enough to participate in production under the voluntary organization of production. But this is logical a mistake we’ve inherited from our agrarian past. The most important part of making the voluntarily organization of production possible, is respecting other people’s property rights, and respecting the commons, and not increasing the expenses that others must bear for your existence in the world. That is why the west is wealthier than the rest – the high trust society. But respecting property – forgoing pleasures, and policing other so that they also forgo pleasures that would make the voluntary organization of production difficult and expensive if not impossible – is a form of work. If you respect property, the commons, and do not increase the costs that others must bear to support you, and police the behavior of others so that they respect property rights too, then you are in fact, working in production. You are working to produce the law, order and property rights that make the voluntary organization of production possible. The high trust society is just as important to the voluntary organization of society as are the resources that go into that production. As such, we must pay people for that work that they do, or we are failing to pay them for their participation in the production of the necessary conditions under which we can voluntarily organize production using the information provided by the pricing system, and our individual incentives to work in order to increase our consumption. [T]his is the “missing” moral argument for redistribution that is economically sound, and institutionally sound, that we have been searching for since the beginning of the industrial revolution in the late 1700’s in England (and which Marx got terribly wrong at the cost of 100M lives, and which Keynes also got terribly wrong, which has cost us again, possibly, the economic health of western civilization.) The economically sound, and institutionally safe method of accomplishing this wage payment for constructing the social order that is necessary for the voluntary organization of production under the pricing system is to (a) redistribute money directly from the treasury to consumers via debit cards (b) base the amount of the distribution on monthly sales taxes collected, and eliminate as much of the income tax structure as possible, if not all of it, and (c) construct that payment as a non-guaranteed commission such that the more people in the work force, the less there is to go around (d) give it to everyone. (e) remove all employment laws, discrimination laws, minimum wage laws and the like (f) make it as much as we can economically tolerate (f) eliminate all other redistributive and controlling government programs and organizations and add that to the payment. (g) and lastly, and perhaps equally as importantly, use direct-from-treasury lending on all single-home single-owner mortgages, and single owner business properties at zero interest rate over 15 years. (g) As Galbraith and I both argued before his death, refinance and write down all mortgages against the treasury and pay them off over 30 years. There is no reason that an investor has the long term right to the interest on a mortgage at public expense. (And yes I have worked through the consequences to institutional investors. This bypasses institutional investors by eliminating the need for them.) Why this set of solutions? Because this (1) makes employment a preference not a necessity, and therefore not subject to regulation, (2) encourages everyone to limit the scope of government and maximize personal take home giving producers and consumers the same interest in keep ing the parasitic state as small as possible (3) doesn’t interfere with the pricing structure by artificially pricing labor and distorting the international price of american products and services. The macro economic importance of this point is greater than the importance of the first two. (4) also this solution would force the population to resist all immigration other than that which increases productivity, and depress the current fictionalization. (5) eliminates the class warfare in government by giving us exactly the same interest. (6) most importantly, it eliminates the majority of the financial sector, by pushing money directly to consumers and causing the banks to compete for consumer savings, rather than construct predatory consumer credit schemes, as we distribute money from the treasury down through the banking system. The impact of this on dismantling the influence of the financial sector on political and world affairs is something that if understood is more profound than the evolution of fiat currency in the first place. I wish I had time to give this the treatment it’s worthy of, but it will have to do for now. Curt Doolittle The Propertarian Institute Kiev Ukraine

A PROPERTARIAN SOLUTION TO THE COMING MOBS OF PITCHFORKS – A BETTER WAY OF GETTING PEOPLE MINIMUM INCOME (READ THIS) (IMPORTANT PIECE) See http://topinfopost.com/2014/06/30/ultra-rich-mans-letter-to-my-fellow-filthy-rich-americans-the-pitchforks-are-coming (regardless of your political persuasion, you should read this. because it’s the best existing answer to the social problem of post-agrarian capitalism). [T]his might sound like a criticism, but it’s not: he “gets it” sentimentally, he doesn’t get it economically, or institutionally, because he’s not knowledgeable enough to ‘get it’ economically or institutionally. But the fact that he expresses his ideas sentimentally, is more USEFUL than expressing them economically or institutionally. Because people will not understand the importance of the economic and institutional arguments. The institutional problem we face with engaging in systematic dependency-creating redistribution is giving everyone the right incentives, rather than those that encourage the expansion of the government, which is a parasite on consumers and producers alike. The economic problem we face with creating institutionalized redistribution is doing it without doing more damage to the complex system of information provided by prices and wages. We forget too easily that capitalism refers to the *voluntary organization of production* in contrast to the various involuntary means of organizing production. The reason why capitalism produces prosperity and socialism doesn’t is because under the voluntary organization of production people have both the incentive to work and producers the ability to make rational plans under ever-changing conditions. Under socialism, people have the incentive not to work, or to work as little as possible, and it is impossible to rationally organize production to serve the desires of other producers and consumers. So capitalism isn’t a matter of preference, it’s a matter of necessity. But here is the rub – and the solution. [W]hen our governments were invented, people worked in an agrarian society where our productivity was marginally indifferent, and determined not so much by our abilities, but whether we controlled our breeding, and whether we had the discipline to work hard. Today, disconnected from the productivity of the land, no longer farmers, no longer farm workers, even if we want to work, many of us cannot, because we can do nothing productive enough to participate in production under the voluntary organization of production. But this is logical a mistake we’ve inherited from our agrarian past. The most important part of making the voluntarily organization of production possible, is respecting other people’s property rights, and respecting the commons, and not increasing the expenses that others must bear for your existence in the world. That is why the west is wealthier than the rest – the high trust society. But respecting property – forgoing pleasures, and policing other so that they also forgo pleasures that would make the voluntary organization of production difficult and expensive if not impossible – is a form of work. If you respect property, the commons, and do not increase the costs that others must bear to support you, and police the behavior of others so that they respect property rights too, then you are in fact, working in production. You are working to produce the law, order and property rights that make the voluntary organization of production possible. The high trust society is just as important to the voluntary organization of society as are the resources that go into that production. As such, we must pay people for that work that they do, or we are failing to pay them for their participation in the production of the necessary conditions under which we can voluntarily organize production using the information provided by the pricing system, and our individual incentives to work in order to increase our consumption. [T]his is the “missing” moral argument for redistribution that is economically sound, and institutionally sound, that we have been searching for since the beginning of the industrial revolution in the late 1700’s in England (and which Marx got terribly wrong at the cost of 100M lives, and which Keynes also got terribly wrong, which has cost us again, possibly, the economic health of western civilization.) The economically sound, and institutionally safe method of accomplishing this wage payment for constructing the social order that is necessary for the voluntary organization of production under the pricing system is to (a) redistribute money directly from the treasury to consumers via debit cards (b) base the amount of the distribution on monthly sales taxes collected, and eliminate as much of the income tax structure as possible, if not all of it, and (c) construct that payment as a non-guaranteed commission such that the more people in the work force, the less there is to go around (d) give it to everyone. (e) remove all employment laws, discrimination laws, minimum wage laws and the like (f) make it as much as we can economically tolerate (f) eliminate all other redistributive and controlling government programs and organizations and add that to the payment. (g) and lastly, and perhaps equally as importantly, use direct-from-treasury lending on all single-home single-owner mortgages, and single owner business properties at zero interest rate over 15 years. (g) As Galbraith and I both argued before his death, refinance and write down all mortgages against the treasury and pay them off over 30 years. There is no reason that an investor has the long term right to the interest on a mortgage at public expense. (And yes I have worked through the consequences to institutional investors. This bypasses institutional investors by eliminating the need for them.) Why this set of solutions? Because this (1) makes employment a preference not a necessity, and therefore not subject to regulation, (2) encourages everyone to limit the scope of government and maximize personal take home giving producers and consumers the same interest in keep ing the parasitic state as small as possible (3) doesn’t interfere with the pricing structure by artificially pricing labor and distorting the international price of american products and services. The macro economic importance of this point is greater than the importance of the first two. (4) also this solution would force the population to resist all immigration other than that which increases productivity, and depress the current fictionalization. (5) eliminates the class warfare in government by giving us exactly the same interest. (6) most importantly, it eliminates the majority of the financial sector, by pushing money directly to consumers and causing the banks to compete for consumer savings, rather than construct predatory consumer credit schemes, as we distribute money from the treasury down through the banking system. The impact of this on dismantling the influence of the financial sector on political and world affairs is something that if understood is more profound than the evolution of fiat currency in the first place. I wish I had time to give this the treatment it’s worthy of, but it will have to do for now. Curt Doolittle The Propertarian Institute Kiev Ukraine