Category: Economics, Finance, and Political Economy

  • When Did The Capitalist Regime Under Which We Currently Live *begin*?

    INTERESTING QUESTION. I”LL TRY TO DO IT JUSTICE.

    The west has been more ‘capitalist’ since its inception 4500 years ago, because it’s been more individualistic, and it’s property rights have been more widely distributed and therefore power has been distributed and balanced for most of our history.   It’s also true that enfranchisement in those property rights has expanded and contracted along with prosperity. YOu had more under rome, and less under feudalism.  More under english common law, and less under european napoleonic law.  More in the 19th century and less today.

    ‘Capitalistic’ means that property rights are distributed.  ‘Socialistic’ means that property rights are concentrated in the state.  The concentration of large amounts of credit under a network of contracts is illogical and unnecessary under concentrated socialistic  systems that we associate with totalitarian governments.

    You could argue that the invention of Venetian accounting, followed by English and Dutch mercantilism is the origin of our modern political model, and that it was formalized into language by Smith, Hume, and the American Constitution.

    Most people, I think, would argue that Napoleon created the nation state and the concept of ‘total war’ and that the system of credit that developed in response to the Napoleonic wars was the origin of our capitalist state.

    Others would argue that the 20th century development of fiat money, fiat credit, the practice of regulating unemployment, and the state as the insurer of last resort was probably when we developed an institutional balance between capitalism, socialism and corporatism.

    Most modern states are ‘capitalistic’ in that they use consumer capitalism and individual property rights to run their economies.  Most modern states levy taxes and and redistribute those taxes under the social democratic thesis that we must have capitalism but we can abscond with a considerable amount of the profits people make, and treat those profits as common property, even if all property is held privately.  Most modern states subsidize key industries as a means of creating an internationally competitive product that gives the country an economic advantage – this is corporatism.

    When the socialist movements succeeded in Europe and Canada, they did not succeed in the USA – probably because we were the military and political center of western civilization in the post war period. Instead, the combination of the Vietnam war, the temporary economic rise of the proletariat due to the rest of the world’s economic collapse from the war, the increase in proletarian birth rates that gave us the 60’s and 70’s, the racial movement of the 60’s,  feminism because of birth control, and various other factors led to a fracturing of american society that continues to effect us to this day.  

    It had become apparent that socialism had failed in theory (incentives and calculation) and as the 70’s progressed we learned that the great society programs ambitions were also a failure, so socialism was a failure in practice. And finally in the 90’s we saw the collapse of world communism and the universal adoption of consumer capitalism.

    1) Starting in the 50’s progressives and liberals (socialists) began trying to develop a philosophical and political framework given that socialism was failing in theory, and because the american people were not ‘buying it’.  This system of philosophy was called ‘postmodernism’.  Postmodernism is an attempt to use the technique of monotheistic religious dogma to propagate falsehoods, that must be passionately treated as moral truths (equality, equality of outcome, relativity of morals except postmodern morals, relativity of cultures except western culture which is bad, and a dozen more.)  Postmodernism and postmodernists have been successful and has effectively become the state religion in america. This is because it both sells goods and services, as well as promotes concentration of power in the state.

    2) Staring in the 70’s conservatives and libertarians developed a series of strategies to combat socialism and postmodernism.  This included what we see today in think tanks, policies, and ideologies.  All of which were designed to combat the state.

    These ideas fell into the following groups:

    1) The most rigid was that the state would bankrupt capitalism, and destroy our traditional society if capitalists didn’t bankrupt the state first.  This meant effectively hiring the corporations and financial empires by granting them privileges and protecting them from taxation.  This approach has been successful – mostly, because Keynesian economic policy requires that the government use the financial sector to insert money into the economy, and the profit available to the financial sector provides them with the incentive to fight the state.

    2) The more practical approach was to promote libertarian policy solutions to social democratic problems, which would accomplish redistribution without empowering the state and expanding its bureaucracy.   This approach has been marginally successful. Most voucher systems or privatization in both Europe and America, were the result of these libertarian ideas.

    3) The ancient approach has been used too. The purpose of organized religion is largely to oppose the state. As the state has grown, the more traditional segments of the populace have turned increasingly fundamentalist as a means of opposing the state. For ancient reasons, it is not possible in america to interfere with religion.  And religions determine the limits of political power.  So religious fervor has increased as a means of opposing the state’s attack on the nuclear family and traditional roles for men and women – and therefore the status signals available to people in nuclear families.

    4) The marxists were extremely successful in promoting ideology instead of philosophy – ideology is a collection of statements for the purpose of obtaining power by appealing to emotions instead of reason.  (This is, again, a tactic taken from the monotheistic religions.)  The conservative and libertarian think tanks began promoting conservative and libertarian ideology, as well as launching news networks and talk radio shows as well as books and magazines.  Ideology and religion are more effective than reason in a population because we are, in total, when voting, expressing our moral feelings, not our rational understanding.

    THE RESULT

    Capitalist ideology (libertarian and aristocratic conservative) , and socialist ideology (postmodernism and democratic socialism) are opposing means of running a society and so we are constantly subjected to extremist arguments form both sized.  Meanwhile we vote our morals. And our morals are almost entirely a reflection of our reproductive strategy.  Since women have more in common in their reproductive strategy than do men, as the number of single women and single mothers increases, the vote continues to move to the socialistic (feminine) social model.  However, immigration and the minioritization of the white population are causing a consolidation of parties into racial and gender distributions that are fairly predictable.

    So most of it is noise.

    ON CAPITALISM

    It is not possible to have any means of production that is not capitalistic. Money and prices contain information and convey incentives that cannot be done in this level of complexity by other means.  However, it is also true that it is possible to expropriate the profits from individuals and redistribute them while preserving the capitalist system of information and incentives.

    Given that a population is small and heterogeneous enough, it appears that a combination of socialistic redistribution and capitalistic production is politically possible. However, heterogeneous societies resist redistribution and increase competition and friction in the state.

    For this reason we will likely continue to have friction here in America until the demographic system plays out with white minority status, and likely some serious conflict at that point.

    YOUR ANSWER

    The capitalistic system evolved over thousands of years and is one of the primary reasons why the west, despite being small, poor, and on the fringe, developed rapidly both in its ancient and modern periods.

    Today we are in less of a capitalistic system but capitalistic rhetoric is very high because of the minoritization of whites, and the opposition to the state. 

    Furthermore, regardless of rhetoric you will always live under a capitalistic system because it’s not possible to coordinate a complex division of knowledge and labor without capitalism.


    I hope this helps provide some clarity amidst the nonsense we are subject to every day.

    Curt Doolittle
    The Propertarian Institute
    Kiev

    https://www.quora.com/When-did-the-capitalist-regime-under-which-we-currently-live-*begin*

  • When Did The Capitalist Regime Under Which We Currently Live *begin*?

    INTERESTING QUESTION. I”LL TRY TO DO IT JUSTICE.

    The west has been more ‘capitalist’ since its inception 4500 years ago, because it’s been more individualistic, and it’s property rights have been more widely distributed and therefore power has been distributed and balanced for most of our history.   It’s also true that enfranchisement in those property rights has expanded and contracted along with prosperity. YOu had more under rome, and less under feudalism.  More under english common law, and less under european napoleonic law.  More in the 19th century and less today.

    ‘Capitalistic’ means that property rights are distributed.  ‘Socialistic’ means that property rights are concentrated in the state.  The concentration of large amounts of credit under a network of contracts is illogical and unnecessary under concentrated socialistic  systems that we associate with totalitarian governments.

    You could argue that the invention of Venetian accounting, followed by English and Dutch mercantilism is the origin of our modern political model, and that it was formalized into language by Smith, Hume, and the American Constitution.

    Most people, I think, would argue that Napoleon created the nation state and the concept of ‘total war’ and that the system of credit that developed in response to the Napoleonic wars was the origin of our capitalist state.

    Others would argue that the 20th century development of fiat money, fiat credit, the practice of regulating unemployment, and the state as the insurer of last resort was probably when we developed an institutional balance between capitalism, socialism and corporatism.

    Most modern states are ‘capitalistic’ in that they use consumer capitalism and individual property rights to run their economies.  Most modern states levy taxes and and redistribute those taxes under the social democratic thesis that we must have capitalism but we can abscond with a considerable amount of the profits people make, and treat those profits as common property, even if all property is held privately.  Most modern states subsidize key industries as a means of creating an internationally competitive product that gives the country an economic advantage – this is corporatism.

    When the socialist movements succeeded in Europe and Canada, they did not succeed in the USA – probably because we were the military and political center of western civilization in the post war period. Instead, the combination of the Vietnam war, the temporary economic rise of the proletariat due to the rest of the world’s economic collapse from the war, the increase in proletarian birth rates that gave us the 60’s and 70’s, the racial movement of the 60’s,  feminism because of birth control, and various other factors led to a fracturing of american society that continues to effect us to this day.  

    It had become apparent that socialism had failed in theory (incentives and calculation) and as the 70’s progressed we learned that the great society programs ambitions were also a failure, so socialism was a failure in practice. And finally in the 90’s we saw the collapse of world communism and the universal adoption of consumer capitalism.

    1) Starting in the 50’s progressives and liberals (socialists) began trying to develop a philosophical and political framework given that socialism was failing in theory, and because the american people were not ‘buying it’.  This system of philosophy was called ‘postmodernism’.  Postmodernism is an attempt to use the technique of monotheistic religious dogma to propagate falsehoods, that must be passionately treated as moral truths (equality, equality of outcome, relativity of morals except postmodern morals, relativity of cultures except western culture which is bad, and a dozen more.)  Postmodernism and postmodernists have been successful and has effectively become the state religion in america. This is because it both sells goods and services, as well as promotes concentration of power in the state.

    2) Staring in the 70’s conservatives and libertarians developed a series of strategies to combat socialism and postmodernism.  This included what we see today in think tanks, policies, and ideologies.  All of which were designed to combat the state.

    These ideas fell into the following groups:

    1) The most rigid was that the state would bankrupt capitalism, and destroy our traditional society if capitalists didn’t bankrupt the state first.  This meant effectively hiring the corporations and financial empires by granting them privileges and protecting them from taxation.  This approach has been successful – mostly, because Keynesian economic policy requires that the government use the financial sector to insert money into the economy, and the profit available to the financial sector provides them with the incentive to fight the state.

    2) The more practical approach was to promote libertarian policy solutions to social democratic problems, which would accomplish redistribution without empowering the state and expanding its bureaucracy.   This approach has been marginally successful. Most voucher systems or privatization in both Europe and America, were the result of these libertarian ideas.

    3) The ancient approach has been used too. The purpose of organized religion is largely to oppose the state. As the state has grown, the more traditional segments of the populace have turned increasingly fundamentalist as a means of opposing the state. For ancient reasons, it is not possible in america to interfere with religion.  And religions determine the limits of political power.  So religious fervor has increased as a means of opposing the state’s attack on the nuclear family and traditional roles for men and women – and therefore the status signals available to people in nuclear families.

    4) The marxists were extremely successful in promoting ideology instead of philosophy – ideology is a collection of statements for the purpose of obtaining power by appealing to emotions instead of reason.  (This is, again, a tactic taken from the monotheistic religions.)  The conservative and libertarian think tanks began promoting conservative and libertarian ideology, as well as launching news networks and talk radio shows as well as books and magazines.  Ideology and religion are more effective than reason in a population because we are, in total, when voting, expressing our moral feelings, not our rational understanding.

    THE RESULT

    Capitalist ideology (libertarian and aristocratic conservative) , and socialist ideology (postmodernism and democratic socialism) are opposing means of running a society and so we are constantly subjected to extremist arguments form both sized.  Meanwhile we vote our morals. And our morals are almost entirely a reflection of our reproductive strategy.  Since women have more in common in their reproductive strategy than do men, as the number of single women and single mothers increases, the vote continues to move to the socialistic (feminine) social model.  However, immigration and the minioritization of the white population are causing a consolidation of parties into racial and gender distributions that are fairly predictable.

    So most of it is noise.

    ON CAPITALISM

    It is not possible to have any means of production that is not capitalistic. Money and prices contain information and convey incentives that cannot be done in this level of complexity by other means.  However, it is also true that it is possible to expropriate the profits from individuals and redistribute them while preserving the capitalist system of information and incentives.

    Given that a population is small and heterogeneous enough, it appears that a combination of socialistic redistribution and capitalistic production is politically possible. However, heterogeneous societies resist redistribution and increase competition and friction in the state.

    For this reason we will likely continue to have friction here in America until the demographic system plays out with white minority status, and likely some serious conflict at that point.

    YOUR ANSWER

    The capitalistic system evolved over thousands of years and is one of the primary reasons why the west, despite being small, poor, and on the fringe, developed rapidly both in its ancient and modern periods.

    Today we are in less of a capitalistic system but capitalistic rhetoric is very high because of the minoritization of whites, and the opposition to the state. 

    Furthermore, regardless of rhetoric you will always live under a capitalistic system because it’s not possible to coordinate a complex division of knowledge and labor without capitalism.


    I hope this helps provide some clarity amidst the nonsense we are subject to every day.

    Curt Doolittle
    The Propertarian Institute
    Kiev

    https://www.quora.com/When-did-the-capitalist-regime-under-which-we-currently-live-*begin*

  • MARXISM DISTILLED: “For Adam Smith you have the division of labor and the invisi

    MARXISM DISTILLED:

    “For Adam Smith you have the division of labor and the invisible hand; for Ricardo, comparative advantage. Marx just seems to be an example of a thinker who took one incredibly wrong idea (The Labor Theory of Value) and fully worked out all of the logical consequences. Given that there’s no reason to believe in the labor theory of value, then most of Marx is just a complicated (although perhaps ingenious) dead end.” – Urstoff, from econlog


    Source date (UTC): 2013-06-09 02:18:00 UTC

  • STOPPING THE BIG DOMINOS Of course, we would argue that the problem is actually

    http://politicalcalculations.blogspot.com/2013/06/keeping-big-dominoes-from-falling.html#.UbCbZitp4w0INTERVENTION: STOPPING THE BIG DOMINOS

    Of course, we would argue that the problem is actually allowing the small dominos to constantly fall. Government creates big dominos. The market works constantly to destroy them.

    GOVERNMENT CREATES BIG DOMINOS – AND THE BIGGEST IS ITSELF.


    Source date (UTC): 2013-06-07 04:25:00 UTC

  • IS BAD. “Will someone tell me this article is wrong?!” No, the article is not wr

    http://www.cato-unbound.org/2013/06/03/michael-c-munger/recycling-can-it-be-wrong-when-it-feels-so-rightRECYCLING IS BAD.

    “Will someone tell me this article is wrong?!”

    No, the article is not wrong. It is correct. Even graciously so.

    HOWEVER:

    1) THE ECONOMICS OF THE RECYCLING MOVEMENT

    The reasons to enforce recycling are (a) political in that it advances the leftist ideological vacuum created by the failure of socialism in theory and practice, (b) psychological – it creates awareness of the veyr important issue of maintaining a clean environment, and (c) it places economic pressure (the possibility of boycott) on marketing and packaging companies.

    But recycling anything other than ‘oil, gas, liquid poisons and radioactives’ is not ‘good for the environment’ or logical or economic in any sense of the word. The optimum solution is to compartmentalize deposits land-fills so that they can be sold off and ‘mined’ at a future date when and if it ever becomes economically viable. In other words, the cost of sorting, transporting, breaking down and distributing goods is not sensible.

    The problem with plastics is not recycling but that they don’t break down well. Plastic bottles and packaging in particular. Recycling is simply a means of providing political cover using false economic calculations for what is probably the most troublesome pollutant that we make. The seas are full of that junk (although, mining the seas for plastic might eventually become a good business for someone. it depreciates our experience of the environment.)

    Contrary to popular belief, landfills are small, inexpensive, and concentrate waste, and create an opportunity for future recycling at low cost. They concentrate resources at low cost for future use. They are ‘savings accounts’ full of resources that can be mined when the economics make it sensible to mine them. Conversely, it’s extremely expensive to transport all that nonsense around to use it now, when we don’t NEED to use it. And we can only tell that we NEED to use something if FIRST, the pricing system tells us so, and SECOND if our moral codes, once understood, suggest that there are not involuntary transfers being created .

    Of course, the economic solution is to drastically reduce population and drastically increase consumption. It’s not that we consume too much. That’s not really logical. It’s that we have too many people consuming.

    Consumption is like information. The more the better. Space travel for example, is the ultimate consumption. It’s freaking expensive. The mass required to convert into energy necessary to get to another planet is terrifyingly expensive in every possible term. So is the information necessary to solve the problem. Every cost we distribute widely is a cost not dedicated to the narrow pursuit of something like space travel.

    2) MORAL RULES ARE PROHIBITIONS ON THEFT

    The author is correct in what he senses, but cannot articulate:

    (a) the pricing system does not make visible ALL costs. (This is one of the three or for conceptual failures in libertarian economic theory – because it discounts the cost of morals – norms, and morals are extremely costly to develop in any society.) Prices tell us what people WANT, what they NEED, and are WILLING TO DO to get it. The last being the most important. But that’s ALL they tell us.

    (b) He doesn’t understand that morals costs are material costs. Because our actions are costly. Our time is costly. But most importantly, our OPPORTUNITIES that we DON’T TAKE are very costly – that’s what manners and ethics are: lists of opportunities that we do NOT take, because it transfers costs in time, opportunity, effort and money, from others involuntarily. Most economists do not make this mistake. Almost all political science, and all political philosophers make this mistake – almost bar none.

    3) LIES AND DAMNED LIES

    The excuses offered by producers of pollutants, and those of the recycling movement are as ridiculous as the carbon market argument: POLLUTING IS STEALING. PERIOD. And GOVERNMENTS created the ability to pollute by giving SANCTION to polluters, and requiring that ordinary consumers have ‘standing’ in order to sue polluters. There is no reason that we cannot require x number of signatures in order to produce ‘standing’ for a crime of pollution, in which every single person has only a micro-claim against the polluter.

    The current argument is that our politicians are elected for this purpose. The stupidity of the argument never ceases to amaze me: why then do we need demonstrably influenceable and corruptible politicians elected by majority rule instead of courts to resolve what are of necessity property rights? This is yet another illustration of the argument against representational government and in favor of the common law, courts, and property rights.

    You can’t sue polluters because the government prevents you from doing it. The common law allows you to. It allowed you to. Governments took away that right on purpose in order to increase taxation available from pollution generating manufacturers. (Yes, you can look it up.)


    Source date (UTC): 2013-06-04 05:36:00 UTC

  • THE MARKET PUNISHES IRRESPONSIBILITY. THE GOVERNMENT REWARDS IT

    THE MARKET PUNISHES IRRESPONSIBILITY. THE GOVERNMENT REWARDS IT.


    Source date (UTC): 2013-05-30 23:30:00 UTC

  • RATES OF DEPRECIATION I write a great deal about this subject, but some pictures

    RATES OF DEPRECIATION

    I write a great deal about this subject, but some pictures do the subject greater justice.


    Source date (UTC): 2013-05-17 02:56:00 UTC

  • HEALTH CARE COSTS?

    HEALTH CARE COSTS?


    Source date (UTC): 2013-05-14 00:23:00 UTC

  • CHINA You know, I tend to look at really boring things like demographics, educat

    http://www.telegraph.co.uk/finance/comment/10044456/China-may-not-overtake-America-this-century-after-all.htmlON CHINA

    You know, I tend to look at really boring things like demographics, education, cultural values (Trust, Truth, Corruption), and the complexity of the products produced rather than the high variability of financial activity. Most of this stuff falls into the long wave hypothesis, which in my opinion is a variation on the Generations hypothesis.

    That’s why I was right about china’s growth path even though I was wrong about how long that they could hold it together. I said 2010, but clearly I didn’t understand their ability to keep pumping money into the economy well enough. Or maybe I misunderstood the value of china as a safer-haven during the crisis. I don’t know. The medium term isn’t my specialty – the long term is.

    That said, there is no way china gets out of the middle income trap. Velocity is impressive, and I certainly understand what they’re trying to do. But no way. Too many other problems.

    But maybe I should hedge that a bit. Sure, there is no way that they avoid having the middle income problem. That isn’t to say that unlike other smaller countries with less control, that they can’t work out of it with levers that most other countries couldn’t use.

    Authoritarian governments can (a) force literacy (b) force spending into the economy and even (c) control birth rates. They can also (d) brutally crack down on corruption, (e) totally destroy the oligarchs without also tearing the country apart. What I don’t want to see them to is what most countries with less control might do (f) externalize the internal conflict through aggressive military expansion. Russia for example, cannot fix its military culture, or its alcohol culture, despite the fact that they’re closely related.

    India can’t do it because india lacks the central power structure to overcome corruption – the red army is always there and happy to use its power. In india they dont’ have that power, and have to achieve it organically – and slowly, if at all. (I wish our army was as dedicated to the constitution as it is to the idea of civilian leadership. The army is more reliable than the courts.)

    I’m just as impressed with recent data as everyone else is. But I don’t have a handle on the state of affairs well enough to look for contrarian positions. And I’m pretty skeptical that we have enough momentum to insulate ourselves from other possible shocks. (Although, those of us who have been studying international politics long enough probably realize that the speed of communication and information


    Source date (UTC): 2013-05-09 09:22:00 UTC

  • Ferguson makes the “Hoppe Argument” and gets similar treatment

    http://economix.blogs.nytimes.com/2013/05/07/keyness-biggest-mistake/Nial Ferguson makes the “Hoppe Argument” and gets similar treatment.


    Source date (UTC): 2013-05-07 04:35:00 UTC