Curt Doolittle

Form: Full Essay

  • A Method For Moderating Dialogs

    “The Cult Of Offensive Moderation” Note: I am in the process of creating a plugin for political moderation of debates, without censorship. There is far too much censorship on debate sites and blogs. Especially censorship of in-group language. The sentiment of inclusion in Democratic Secular Humanism (our current religion in the west) is at odds with the change in our word-wide status and economic position as a polity. In-grop sentiments are becoming increasingly important again.

    [callout]Solution? Categorize posts in a debate as to whether they are:
    1) content free or off topic
    2) sentimental expressions
    3) mythical, Platonic, or scriptural reasoning
    4) Objective rational arguments
    5) scientific arguments (using survey data but which are very fragile in the social sciences) and
    6) economic arguments (which because of scale and aggregation allow cultural comparison.)
    If you could filter conversations by these arguments,the reader could participate in a conversation of his own level of capacity.[/callout]

    1) The strategy of moderating sentimental (non rational) expressions will not work, because it leads to regression – increasing sensitivity as a means of ostracizing people to the point where commenting becomes more an act of policing until the board declines. It increase the transaction cost of participation. 2) As someone who runs a large advertising agency that must help companies and groups understand ‘social interaction’, I spend a great deal of time trying to educate editorials that the ONLY thing people find interesting is CONFLICT. Talking head shows are either internally engaging in conflict (crossfire), or externally (oprah/hannity). Conflict leads to ratings and ratings to participation. WIthout conflict, in either a novel, sort story, or a talk show, there isn’t much to hold anyone’s attention. And the more attention that you hold (the more viewpoints included) the more likely one is to have a member of the audience identify with one of the participants, and become involved. 3) People learn by first identifying the SENTIMENTAL statements that they agree with, and then seeing those statements refuted. If you eliminate the religious nuts, or the racists, or the culture-ists, you’re actually killing off the social value as well as the attraction of your medium. Because all people operate by sentiments. They may learn to articulate those sentiments as mythology, as reason, as science, or as economics, but they are still, almost universally, articulating their sentiments – simply with a different degree of precision. 4) Personalities (contributors) cannot be allowed take over the board or its brand and become the show itself. That’s board-hijacking, rather than thread-hijacking. So if you have permanent troublemakers that begin to draw too much attention to themselves then it is better to heavily moderate them. But not because of the content and form of their arguments. You ban them because they dominate the conversation and make their own ‘show’ on your dime. Losing participants is dangerous for any medium. Even bad ones. Sanitizing a board usually ends up with no board at all. 5) Increasing the number of editors so that they split posts into new threads is better than banning or correcting. Remember – people are largely seeking attention for their niche fantasies. Ignoring people is the most effective means of negative reinforcement. 6) Sentiments (unarticulated expression) are the most common form of narrative. They are analogical arguments. Reason (to the degree that few people can actually articulate causal properties of categories), science (directly measurable subsets) and economics (indirectly measured supersets). Religion as we mean it, refers to scriptural command, or external non-human knowledge, in the monotheistic meaning. Polytheism and history are simply differences of degree. It is scripture. 7) it is particularly troubling to eliminate what is called hate-speech or inter-group expression of sentiments. That ‘s because the most important dialog of our age is the change in group sentiments now that the worldwide change in status and power hierarchies has come about because of the worldwide adoption of western economic and material technologies. SOLUTION? Editing and moderating are hard. It is very, very, difficult to ascertain the quality of an argument in the social sciences. We are fairly sure that the entire Marxist religion, masquerading as a political movement, is as irrational as the Islamic political movement masquerading as a religion, are both extremely dangerous to mankind. But since we live in a POLITY, and the member of that polity largely use SENTIMENTS rather than reason in debate, and that their beliefs and debates are highly influential upon the outcome (more than reason by a long shot), and that most people criticizing these sentimental arguments lack causal depth in their own arguments, then the best board, the best discussions, the best social outcome, is determined by keeping an argument on track, rather than censoring it. An alternate solution, (and I have done a little work on this) categorizing posts in a debate as to whether they are 1) content free or off topic 2) sentimental expressions 3) mythical, Platonic, or scriptural reasoning 4) Objective rational arguments 5) scientific arguments (using survey data but which are very fragile in the social sciences) and 6) economic arguments (which because of scale and aggregation allow cultural comparison.) If you could filter conversations by these arguments, you would be able to stack them by methodology, and the reader could participate in a conversation of his own level of capacity. DIFFERENT IDEOLOGIES Although, we should note, that as scripture, you will have a hard time actually arguing against catholic doctrine as it’s based upon natural law: the observation of what men actually do. WHich is, what appears to be, the general sentiment and strategy underlying most semi scientific argument on this board. (Which I admire). If you want to argue using reason, the libertarian methodology will most likely lead you to correct conclusions. However, libertarianism consists of a set of branches, some of which do NOT correspond to reality, including 1) Rothbard’s principle of non-violence which is a silly argument, since the entire problem of social order is non-violence 2) free trade would lead in the end, to as state of affairs not any different from world-governance 3) libertarians have not included the cost-of-forgone-opportunities which is how we pay for the creation of some set of property rights, and therefore, failed to account for the cost of developing social order. As such, it’s a platonic fantasy counter to evidence. Conservatism is the best strategy for preventing social destruction, revolution and un-meritous rotation of elites. It is very skeptical of power – power should be obtained by public service in the market, or in the military in the defense of the market. Any other grab at power is specious. That’s the sentimental origin of the western city-market building shareholder system we call ‘citizenship’. But conservative philosophy has not provided a solution to our vast increase in the division of knowledge and labor. It has not provided us with an updated set of institutions for the contemporary world. And FWIW : Conservatism is largely an unarticulated sentiment that is more complex than left-liberalism, as conservatives rely on at least five axis the most important of which is group persistence, and liberals only one (harm/care). The combination of harm/care simplicity, egalitarian equality, Keynesian macroeconomic policy (statistics, full employment, liquidity) and democratic government, are ideal tools for competing with a sentiment thats primary purpose is to avoid hubris, and protect the group for the long term. In other words, consumption on the left versus capitalization on the right.

    [callout]The balance between liberalism (Pareto’s Instinct for Recombination, or Machiavelli’s Foxes) and conservatism (Pareto’s Preservation of Aggregates, or Machiavelli’s Lions) is a necessary conflict between the forces of stability that must allow change, but not disruption, and those that desire change regardless of consequences – because both innovation and stability are valuable to a civilization This debate in sentiments is particularly useful because reason is insufficient for solving this problem, largely because we have failed to make the same progress in induction and the social sciences that we have in deduction and the physical sciences. And partly because the physical sciences are vastly less complex than the more heuristic social science governed by the properties of the human mind.[/callout]

    The balance between liberalism (Pareto’s Instinct for Recombination, or Machiavelli’s Foxes) and conservatism (Pareto’s Preservation of Aggregates, or Machiavelli’s Lions) is a necessary conflict between the forces of stability that must allow change, but not disruption, and those that desire change regardless of consequences – because both innovation and stability are valuable to a civilization This debate in sentiments is particularly useful because reason is insufficient for solving this problem, largely because we have failed to make the same progress in induction and the social sciences that we have in deduction and the physical sciences. Partly because the physical sciences are vastly less complex than the more heuristic social science governed by the properties of the human mind. And just so we’re all living in rational reality not committing the error of confusing our own religion with neutral objective science, much of what is argued for on this board by well meaning products of our the past sixty years of western educational system, most often is doctrine of the RELIGION of Democratic Secular Humanism (which is a religion as it is contrary to the facts). Or of egalitarian equality, which is is a property of the Democratic Secular Humanist religion, and is also contrary to the facts. Or the assumption that freedom is the desire of the majority is counter to the facts. That is, as long as we realize that people are racist, culture-ist, class-ist, nationalist, cultist, members of competing civilizations, and they all are, because they all act that way under DURESS, and that it’s advantageous both for elites and for the underclass to be ‘anything-ist’, and that these traits are beneficial to economic man, beneficial to individuals, and an enduring part of the human experience. And if one doesn’t think so, then truth isn’t one’s objective, platonism is. Truth is correspondence with reality.

  • An Analysis Of Freedom #2: The Economy Of Freedom

    A Little History For Context

    The term ‘Freedom’, and its near relation ‘Liberty’, have a long heritage.   The babylonian words “ama-gi”, meaning “Return To The Mother”, written in cuneiform, are often cited by Libertarians as the first written use of ‘freedom’. That usage literally refers to giving a slave back to his mother — an analogy to the more precisely stated ‘freeing him from slavery’ – owners gave a slave back to his mother when freeing him.  In practice, the word “ama-gi” was used to grant exceptions from the dictator’s obligations or taxes.  So the term meant freedom from obligations to the government. These special dispensations were used as a reward – freedom from requirements. The most simplistic use of Freedom described the opposite of slavery. It was not an abstraction, but a direct analogy to the deprivation of one’s choices under the threat of violence. Slavery to contemporary ears is a horrid system, but under barbarism it was universal. ( Barbarism refers to those people not members of one’s market  system ) (( DEFINITION of “BARBARIAN”: Those persons who do not pay the set of costs of forgone opportunity, employed within a social order that cooperatively manages a market and territory. )) Most farm labor required a great deal of physical effort — hard work easily avoided with slaves. People often sold themselves into slavery simply because it was a reliable way to be fed and sheltered in a world where starvation and hunger were common. Wars and raids were conducted to obtain slaves – forced laborers. And escape was dangerous in that ancient world – without a tribe to take care of you, starvation was almost guaranteed. Later, ‘Freedom’ was the term used to describe a Free Man. A ‘Citizen’. A ‘non-barbarian’. This means quite literally, in a world consisting largely of either barbarians, competing warrior states, or eastern dictatorships, ‘an investor in the city and market’. As an investor, or rather It is hard for us to to imagine a world of barbarians. It is not so hard to imagine a world filled with conquerors. Today’s barbarians are immigrants who do not conform. And nation states that seek power in order to obtain resources and trade routes. Liberty by contrast, refers, not to constraint of, and control of, individual actions under threat of violence such as under the institution of slavery, but to the more general absence of coercion by a government, of those people who are not slaves, and not barbarians, and therefore citizens.  In particular, in the west, it implies and egalitarian relationship between all those who are responsible for society: refraining from imposing conditions other than those one places on one’s self, or are required in order to maintain the property definitions (( DEFINITION of “PROPERTY DEFINITIONS”: A set of forgone opportunities that require one refrain from using objects of utility, or refrain from seizing or creating opportunities for gain – ie: self enforced self deprivations – usually described as property both individual and shareholder, manners, ethics, morals )) that constitute the social order. ((DEFINITION of “SOCIAL ORDER”: A social order is a collection of property definitions, and the required forgone opportunities required of members of the society in order to allow non-violent cooperation, and the establishment of a division of labor, and peaceful trade and exchange. And if a landed culture, also including the visible material contributions needed to maintain the physical viability of the territory, its built capital, its resources, and most importantly its market – without which escape from poverty is impossible. )) But in response to increases in the complexity of social order due to increases in population and the resulting increases in the division of knowledge and labor, both of the terms of “Freedom” and “Liberty” have been subject to political framing by public intellectuals and politicians, and their followers in the pragmatic public who use the extraordinary and uncommon freedom of speech ‘discount’ under democratic government to redefine these terms.  This redefinition of the Social Order’s Property Definitions, and restatement of the material costs and  the forgone opportunity costs of that system, has effectively constituted a legitimization of fraud, theft and redistribution. This restatement consequently led to a gradual usurpation of the social accounting system of opportunity costs, material costs, that make the market society possible. This distortion and confusion of meaning begs analysis, so that we, as members of a society under a democratic government, can tell the difference between those commonly held properties of freedom and liberty that are necessary and possible, from those that are either forms logically and physically impossible, from those that are intentionally obscure or distorted for the purpose of committing fraud and theft — or both. While frequent increases or decreases in redistribution of the PROFITS from the market are not only justifiable and beneficial, but warranted as a return on on the investment to shareholders (( DEFINITION of “SHAREHOLDER”: Synonym to “CITIZEN”: individuals who contribute forgone opportunity costs expressed as property definitions and thereby pay for the social order. ))  (“Citizens”) as the division of knowledge and labor increases, the redefinition of the accounting system of property definitions, and forgone opportunity costs is simply a complex form of corruption, theft and fraud.  Corruption theft and fraud  made possible by the obscurity of the causal processes employed to create the Social Order, due to the fact that they are evolutionary in origin, unarticulated, expressed almost entirely as sentiments, and understood only as habits, superstitions, traditions, or exploitations, rather than as a system of precise and material accounting and costs, that materially effect economic calculation and human cooperation as the size of the population and the resultant division of knowledge and labor increases.

    A Society Is Its Market : The Agrarian Society, Built Capital, Trade, And The Division Of Knowledge And Labor

    (UNDONE)

    The West And The Fraternal Order Of Market Making Soldiers

    The Great Transformations: In Europe, Asia, The Middle East, and Africa Converting From Barbarism To City And Market – Europe Converting From Barbarism To Irrigating The Alluvial Plain – Middle East Converting From Barbarism By Combat – Asia Remaining in Barbarism – Sub Saharan Africa

    The Behavioral Properties Of Freedom

    The Desire For Freedom Versus Security.

    Endless Want And Acquisitiveness, and The Role Of Imitation, Envy  Status, And The Status Economy.

    (UNDONE)

    Property Is Defined Universally, But  Shareholder Rights Are Open To Corruption

    (UNDONE) The Oddity Of The Cognitive Bias In The Consensus And Equality Sentiments (UNDONE) Consensus Is Limited, On Means, and On Ends To Small Numbers Of People With Similar Objectives, Abilities, and Resources (UNDONE)

    Freedom And The Status Economy

    Almost Universally, Humans Don’t Like Status That Is Not Given as a reward for redistribution. All cultures, all humans, sense and express resentment at ‘excessive returns’ on any type of investment. Under heroic cultural systems, the hero is granted status and access to opportunity in exchange for his efforts on behalf of the group.  As population increases, classes form because enough people exist in each class that they form group status hierarchies, and trade opportunities, and contribute to sustaining the group’s advantages.  In effect, a class becomes an organization or bureaucracy whose members attempt to preserve it’s network of opportunities – it’s binding principles. At this point, exchange between classes must form some sort of trade network, and as this happens, classes, as organizations,  compete against other classes for status.

    The Freedom Seeking Minority Versus The Equality Seeking Majority

    The Vast Majority of people to not want freedom, because freedom requires responsibility and risk.  When people come to free societies, they either desire the standard of living, or access to opportunity. But they rarely, if ever, desire to contribute to the maintenence of the market order by forgoing opportunities, .  In fact, they desire to gain the most using the least contribution. Likewise, (equality) So the contemporary use of the word freedom is the opposite of the contemporary use of the word equality

    Property Is The Human Accounting System And Money And Numbers Increase Our Capacity for Perception, Comparison and Calculation Of Property

    (UNDONE) The Economic Function Of Freedom In a division of labor, freedom increases consumption, decreases cost of maintaining the behavior of paying opportunity  costs to create the  market and contribute to property definitions, but most importantly, increases the process of trial and error – the process of entrepreneurship. Increases in trial and error lead to increases in the division of knowledge and labor, and increases in consumer choice, and decreases in prices.

    The Limited Use Of Freedom As A Competitive Strategy Between Groups

    If we define freedom as freedom from coercion, then there are only so many strategies that work for different groups with different abilities and resources.  Total freedom, which means barbarism,  Religion (resistance), Trade, and Force.

    Freedom As Return On Investment In The Market, And The Market Is The Social Order

    Freedom obtained in exchange for one’s return on one’s investment of forgone opportunities in the property definitions that constitute the local market. This contribution of forgone opportunity costs, is the cost of entry into the market, and the means by which one has access to the market.  One can only be as free as the granularity of the property definitions. Profits are signals that convey rewards from the market participants that you have been rewarded for fulfilling their wants and desires. Redistribution is a form of return on the market, but only so long as (only so long as what?) Freedom is only relevant in a market society.  Market societies are superior to alternative societies.

    The Economy Of Freedom

    We are all born free, so to speak, and able to use perception, memory, thought, action, force and violence to get whatever we want, if we choose to. Cooperation is not a necessity, at least for the strong. It is a compromise. It is a trade off. So lets look at the scope of actions human beings can take, and start from there, so that we can understand cooperation and freedom, and the compromises, costs and benefits that cooperation requires of us. Scope Of Individual Human Action If we eliminate the nearly infinite complexity that comes along with cooperation, we are left with only this scope of human actions.

      • A.0) Thought
      • A.1) Motion
      • A.2) Consumption
      • A.3) Transformation
      • A.4) Violence
      • A.5) Mating

      The Five Freedoms

      Given the possible scope of human actions listed above, there are only five possible non-contradictory freedoms available to human beings. Non-contradictory means that they can be granted to others equally without coercing them.

        To grant these rights we only need to refrain from violence. In libertarian philosophy this is the principle of non-violence.

        By refraining from violence we enforce cooperation.  In other words, we coerce cooperation by depriving people of their natural ability to use violence.  Furthermore, by depriving people of violence we make them more equal, by redistributing opportunities from the strong to the weak.

        All other freedoms or rights, are derivatives of those five listed above. The remaining freedoms people commonly refer to are technologies of coercion for the purpose of cooperation, or of opposition for the purpose of competing with or avoiding the coercion.

        To say that they are forms of coercion, is not to demean them. Many coercions are a proxy for violence. Property itself is a coercion.

        We defend property. (talk about property and memory here)

        there is a limit to cooperatino because of a limit to perception. Imagine for a moment that you could know the wants and desires of all people on the planet at once, and you could also know, all the resources that could be put to use by each person, all the skills that could be put to use by each person, all the tools available to each person, all the relationships that each person has, and the geography that each person has access to. Imagine trying to organize it all. Now, imagine that each person is trying to at least maintain his or her respect, or status. And that all these people are of different ages, and of differentI. Cooperative Organization – The Production Economy

        Cooperative freedoms permit the division of knowledge and labor, which decrease everyone’s costs, or the concentration of effort to increase both the likelihood of success, and decrease the individual costs. Many people use subjective analysis, expressing these cost reductions as emotions. But our emotions exist to assist us in identifying cost reductions. Emotions describe changes in state. They inform us. They inform us in particular about changes in the state of our costs. Human aesthetics may be wounded by this fact, but all group emotional sensitivities are to costs and discounts.

          • Coercion: Norms under threat of violence.
            Opposition: Violence, Fraud, Theft, Coercion, Physical Restraint, Enslavement
            Cost: Forgone Opportunity costs of Coercion, Fraud, Theft and Violence. The cost of not stealing.
            Perception and Calculation: Property and prices allow us to percieve beyond our senses. To cooperate in large numbers. Property IS calculation.
            • Key Concept:
            • P.1) Life, Movement and Action:
            • P.2) Property (Exclusive Use. Inventory)
            • P.3) Exchange (Trade)
            • P.4) Freedom of Cooperation:
            • P.5) Freedom Of Assertion

            II. Cultural Organization: Manners, Ethics, Morals, Religion  – The Conformity Economy (Inclusion / Ostracization)

            Ethics: The Invisible Cost Economy Freedom to attempt to establish a network of norms: restraints on action enforced by inclusion or exclusion in the group. Inclusion in the group reduces risk and increases opportunity.

            Manners, Ethics and Morals are terms for different segments of a spectrum for controlling costs of a group. Manners reduce friction and demonstrate predictability, class and quality. Display of good manners means access to more people who may grant one more opportunities. Each use of good manners requires some form of discipline. Each act of discipline is a cost to the individual, and a contribution to the cultural institutions. Each abuse of manners is a lack of discipline and a withdrawal from the cultural institutions. Manners must have a witness who can observe the demonstration of one’s discipline. In a demonstration of manners, there is no asymmetry of information. Each equally can observe the other.

            Ethics on the other hand is a study in asymmetry. An action is ethical or not, because of shared lack of knowledge of the future, and asymmetry of knowledge between individuals. If one person has deep knowledge and the other shallow of the same exchange, ethical treatment requires that the person with greater knowledge act as if the other person is possessed of the same knowledge, and each is responsible for protecting the other from harm.

            Ethical systems generally occupy some portion of a spectrum from the criminal to the charitable. a) The Criminal Ethic: I take what I can, without consent. a) The Bazaar Ethic: whatever I can get away with in voluntary exchange. b) The Warrior Ethic: whatever will not make the other or unhappy. c) The Christian Ethic: What is equally beneficial for both parties. d) The Charitable Ethic: As long as the other person prospers, I do not care what my outcome is. Then most ethical systems generally consist of intra-group and extra-group criteria, that might not be the same. Within and across family, clan, tribe, culture, religion, race, each culture varies in its adherence to its ethical standards. Furthermore,

            Moral systems imply total asymmetry of knowledge. Actions fall under moral criteria whenever the cost of seizing an opportunity for one’s benefit either risks, or places an external cost, and a high cost, on others, and in particular, others with no recourse.

                • Coercion:
                  Opposition:
                  Cost:
                  Perception and Calculation:
                • C.1) Cultural Freedom: (Choice and Opposition)
                • C.2) Freedom of Norms (Competition and Choice) Participate in sets of norms, to select norms.
                • C.3)
                • Religion (Cultural Law And Institutionalized Conformity)

                • R.1) Religious Freedom: Freedom to create institutions, rituals, and codes for the purpose of establishing the criteria of inclusion and exclusion (ostracization). Including Freedom to choose to participate in religious factions, and freedom to evade participation in factions. Religions create opportunity monopolies and attempt to disallow competition of forgone opportunity costs. Competing religions are competitions of opportunities and opportunity costs. Evading participation is an attempt to obtain opportunities at a discount.

                III. Regulatory Organization: Law(organized violence and coercion)

                P.1) Political Freedom (Choice and Opposition): speech, assembly, leadership, concentration of wealth. (The right to cooperate against others who have a similar right) The right of opposition. Political freedom is the freedom to cooperate for GROUP ends, by pooling resources, and establishing an organization, or association for the purpose of advancing those ends.

                  • L.1) Legislative Freedom:
                  • L.2) Institutional Freedom:
                  • L.3) National freedom:

                  IIII. Credit Organization (Anonymous, Non-Territorial Law)

                  • CL.1)

                  VI. Capitalist Freedom

                  (organizatoins to concentrate real capital) (abstract property definitions)

                    V. Redistributive Organization

                    • R.1) Redistributive Freedom

                  • Is Economics Ideological By Nature? (Yes and No.)

                    The Curious Capitalist at Time Magazine posts: “Is economics ideological by nature?” by Barbara Kiviat

                    It’s easy to rag on economics as not being a “real” science, and I try not to do things that are too easy. But in recent weeks I’ve really started to wonder. It is fascinating, and frightening, to me that smart economists can disagree about whether what the economy needs right now is more government spending or less. The debate isn’t about how much stimulus, or how much austerity, or the way such stimulus/austerity should be applied, but rather about which one is called for in the first place. How is this possible? It’s like a group of doctors not being able to agree whether a patient’s blood should be thinned or coagulated. What am I supposed to make of that?

                    Let’s be technical for a moment:

                    [callout]Whether we do better governing with econometrics than random guessing, or by asking the average man on the street, or than relying on traditional wisdom, or better than interpreting a deity, or even interpreting entrails, is yet to be proven. In fact, it appears from the data that asking a random person on the street is a better predictor than any economic model. — And anyone who tells you differently is not scientific but ideological.[/callout]

                    1) Economics is a correlative mathematical discipline. Science is a methodology for incremental improvement of knowledge. Economists are attempting to act scientifically in their research. (Many of them anyway.) However, unlike the physical world, reproduction and interpretation of economic data are very hard to accomplish. We are doomed to eternally vulnerable correlations. Our mathematics and our measurements are too simple for the problem we’re taking on. But we know that. Everyone in the field knows it. As such, we’re acting scientifically, but our answers are not scientific, only our process of discovery is scientific. And our process of discovery is incomplete. People often equate scientific with ‘true’. But that’s an error. Science is a process of refinement whose purpose is to reduce human error. All scientific knowledge is tentative. It’s just the best we have to date. Economics (econometrics) must, of necessity, require assumptions because of ‘causal density’. The number of causal factors is very, very high. Human economic activity includes shocks (shortages) and inventions, and as such it’s economics are not gaussian (normally distributed), so any one event in a myriad of causal hierarchies can radically alter the entire network of human behavior. Unfortunately our mathematics, even in economics, tends to be probabilistically gaussian (normally distributed), rather than probabilistically mandelbrotian (abnormally, or randomly distributed). Simply because we do not know what we do not know, and have not figure out yet, ‘where’ there is a likelihood that we may ‘know’ something in the future that will effect our economy, and how people may react to it. 2) Political Economy is a moral philosophy that makes use of economic data for the purpose of determining the investments and returns on a society’s investment portfolio. A society is best thought of as a joint stock company with larger and smaller shareholders with different classes of shares each trying to get the management team to work in their favor. These shareholders have different interests. They want different things. They all ‘invest’ in society if only by not undermining it, or engaging in theft, fraud and violence. Most pay taxes. Some risk their lives in military service. We all buy our shares differently, and are rewarded differently. We do not understand the mathematics of human reasoning. It is largely the result of the properties of memory and of our cognitive biases. We are using correlative mathematics from the physical sciences to compensate for the fact that we do not understand the mathematics of human memory – probably because it is vastly more complex, and we do not have enough of the right kind of data. However, our use of current mathematics leads us to errors of aggregation and misunderstanding of causes. In fact, many have argued that all human knowledge is correlative, not causal. So we may always be working with insufficient information. 3) Politics is Decision Making: As a body politic, we disagree about the goals of political economy. We disagree about the purpose of government itself. This is because there are varying groups in our polity with different class, cultural, generational value systems, as well as different resources, and different biological capabilities. Our entire body of human moral codes are based upon circumstantial values (farming societies), and we no longer live in a farming society but an urban one. We are not even sure what a ‘good economy’ looks like for a densely urban society, or even if our limited tools of laws, religion and credit are sufficient technologies for maintaining social order: respect for some form of property, political decision making, cooperation, and redistribution. So, the problem is that we MUST use some sort of bias in resolving economic problems. We are using limited tools and a model of decision making in government that is probably antiquated for our circumstances. It was designed for city states. It seems inadequate for an empire. Society is changing very rapidly. We are open to many different unpredictable shocks. We have different preferences we apply when solving economic problems. And we must have those preferences in order to make some sort of decisions. And no matter what decision we make some faction of society will want another decision made instead.

                    [callout]This is because of the fundamental problem of human cooperation: while we can agree upon ends, we cannot agree upon means. And even when agreeing upon ends, it requires that we know and catalog ALL ends, and then sort among them. And given a multitude of ends, it becomes impossible for people to prioritize them, or even comprehend them. Our society is simply too large. [/callout]

                    This is because of the fundamental problem of human cooperation: while we can agree upon ends, we cannot agree upon means. And even when agreeing upon ends, it requires that we know and catalog ALL ends, and then sort among them. And given a multitude of ends, it becomes impossible for people to prioritize them, or even comprehend them. Our society is simply too large. THE PROBLEM OF POLITICAL ECONOMY As such, a large economy is better, but politically difficult to govern unless it is very homogenous with people sharing very similar values. A smaller economy is less strong, but easier to govern. The worst economy of all is a large strong one like that of an empire, with many, many factions – because there are too many choices and people are not gregarious in diversity, just the opposite. And that’s the political environment that we have to work with. To make matters worse, our federal government can print money which makes it seem like we can either solve fewer more complicated ends, or we can solve a larger number of ends, than we actually can. Printing money as a means of redistribution or insurance are one thing. Printing money so that there isn’t any shortage of it is another. Printing money so that we just distort and confuse everyone, including economists, is something else. And we are doing too much ‘something else’. We are not the blind leading the blind. But we are definitely expecting too much of our current level of understanding of economics, when economic reasoning has become the primary means of decision making in human political systems. Whether we do better governing with econometrics than random guessing, or by asking the average man on the street, or than relying on traditional wisdom, or better than interpreting a deity, or even interpreting entrails, is yet to be proven. In fact, it appears from the data that asking a random person on the street is a better predictor than any economic model. And anyone who tells you differently is not scientific but ideological.

                  • All Costs Are Opportunity Costs. Projections Do Not Include The Alternatives.

                    This article by a local democratic group led me to this CBPP article, which is a response to a paper by the Heritage foundation.

                    Some critics continue to assert that President George W. Bush’s policies bear little responsibility for the deficits the nation faces over the coming decade — that, instead, the new policies of President Barack Obama and the 111th Congress are to blame. Most recently, a Heritage Foundation paper downplayed the role of Bush-era policies (for more on that paper, see p. 4). Nevertheless, the fact remains: Together with the economic downturn, the Bush tax cuts and the wars in Afghanistan and Iraq explain virtually the entire deficit over the next ten years

                    Which is another example of pretending that the long-cycle view of the republicans, from the sixties through the previous administration is selfishness rather than a REACTION to the socialist policies and socialist social system that conservatives were fighting for the majority of the 20th century. It was the conservative perception that without reinvigorating business and in particular entrepreneurship, that the american quality of life would perish, as it had appeared to by the 1970’s. If you think the european model is better, go live there for a while. Life in europe is expensive, cramped, dirty and urban. People look, act, and feel poor by comparison. The pretty part of europe seen by tourists was built in prior centuries under the great monarchies. It has nothing to do with the post war model. European cities are vast rings of urban blight, Los Angeles style, around small downtown cores of ancient monarchical elegance. By and large, no matter what social class you live in, america has offered better opportunities to its citizens. People have more choices. Add to their costs the necessity of rearming, and that they have a social problem with muslims on the scale of our post-slavery problem with blacks, and they have tremendous future costs to bear for their model. So go live there. Really. For a while. Life in europe is expensive. An expensive life neutralizes many class status differences. And that’s really the point of those models. But that aside, what bothers me most about the CBBP analysis, regardless of the figures presented by the heritage foundation, is the belief that our country would not endure OTHER costs, often strategic costs, that are NOT expressed in the numbers, if republican policies were not undertaken. We have accomplished much of our ambitions with the wars, which is to neutralize Iraqi expansionism, and punish afghans for hoteling terrorists. that we continue to attempt to create democracies is an ideological problem. It would be cheaper to reduce pakistan and iranian capabilities as we have iraqi and afghani capabilities. But we will not do that because we feel that we must be ‘nice’ to people who attack us, rather than punish people who attack us. But unless we forecast the republican view of the future, which was one in which even worse outcomes existed for the USA’s budget, and in particular, energy costs and decreased entrepreneurship, and decreased competitiveness, The dirty secret underneath our lack of competitiveness is our education system. We are paying vast competitive costs by forcing education into the private sector, and producing inferior goods, because we do not teach disciplined excellence in schools as do the germans. We don’t teach it for political reasons. We’re dumbing down our citizens. And it’s that cost that republicans are trying to fight as well. So most of the forecasts based upon assumptions made by both sides are complete nonsense. All that said, I responded with: I have absolutely no idea how you are coming up with this chart, and what assumptions it’s based upon. But it’s correspondence with reality approaches zero. Our tax revenue problem is far deeper and far more structural than whatever assumptions you’re relying upon. These include the dollar, the world economy, structural unemployment, and demographic changes. Most importantly they involve the class and race issues involved with different occupational distributions, and the resulting difficulty in putting vast numbers of our population (in particular, males) into industries that are permanently lost to us. We have expanded enough of the bottom end of the labor force through immigration, that we cannot push down our existing labor force into less interesting, but certainly productive, jobs. No society can survive 20% of the male population living in frustration. This anxiety will be directed somewhere. The country, as both a domestic and international empire, is too insufficiently homogenous to permit higher taxation and redistribution. It is contrary to human nature. There is no evidence of it in history. There is no evidence of it in behavioral testing. The costs of conducting these poorly managed external wars do not account for the cost of not prosecuting them, which are not insubstantial, and perhaps greater. Our domestic political mythology is a conflict between the erroneous assumptions of the twentieth century, and the expired political technologies of the eighteenth century. Neither side is going to get their desired future. We are headed toward the south american model of class and racial segregation of urban centers and a powerless central government. This pattern is evident in immigration and emigration moving patterns, demographic changes, domestic trade, domestic cash movement, re-regionalization of identity, and a loss of confidence in both the government and the nation itself. Conservatives live in a fantasy that the colonial republic is possible to reinstitute. Liberals live in a fantasy of the homogenous egalitarian society. But democratic republican government cannot function at our current scale for the same reason socialism cannot function at scale – information and incentive problems. Even if politicians want to make good decisions, law and taxes are insufficient tools for doing so. Only credit and banking and provide sufficient granularity of management, and our state is not structured any longer to assist in building the economy, only in resolving conflicts between interest groups. Furthermore human beings do not, never have, and never will operate in an egalitarian fashion across status class and race boundaries because status is more liquid and valuable in-group than extra-group. And because epistemologically, human beings do not possess sufficient perception, information, and intelligence to operate as creatures without status signals to tell them which actions are good and bad for them, any more than they can cooperate in large numbers without pricing signals to tell them what actions are good and bad for them. I am sorry if this is to complex an analysis for a posting on tax and spending policy. But I am speaking to the false assumptions that underly the graph that you presented here. I would love to live in an egalitarian redistributive society. But to accomplish that goal, you will have to fragment the empire into regions, reduce the federal government to banking and military functions, return the legislative control to the localities, and allow the natural preference that people express to associate within race and class. And that is antithetical to the underclass fantasy – a fantasy which is more concerned with status than it is with money. But every society is composed of classes. Not just economic classes, but social classes, and ‘greater and lesser productive classes’. And each of these groups pursues its own interests. And because those interests are epistemological in nature ( people need to know how to act ) they are permanent. And as permanent features, they will, especially under prolonged economic duress, be expressed by citizens. Either openly or in black markets, racism, and corruption. You will never achieve equality outside of a few million people of very similar racial and cultural preferences, with very similar economic interests. Otherwise, The only equality is in poverty. And that set of problems underlies the reason why people will become more conservative. ie: they will express sentiments of group persistence and attempt to implement those sentiments by legislation. So, we are destined to decades of political hostility. Because the US is now an empire, both domestically and internationally. And while internationally the government has lost legitimacy. THat is irrelevant compared to the loss of legitimacy of the government here at home. The only thing we can do is contract the empire and attempt to get our people employed in, while getting the upper and middle classes to try to create jobs and we may have permanently displaced our society by trade policy. THe germans build their society to produce disciplined craftsmen. This is important, because craftsmen can create exportable hard goods. But we have tried to create a service economy. And a service economy must bring people INTO the country in order to serve them. We can create a medical tourism industry. But that is not sufficient. We can close our educational system to foreigners. but that is not sufficient. We can devote vast labor to building nuclear power plants, a new power grid, and electric automobiles. And that might be enough. But we can never put people back into building houses. It creates expensive sprawl. But most importantly, it doesn’t make people ‘skilled’. It’s the intellectual equivalent of ditch digging, and as such it is a vast loss of human capital. Thats the reality of it. So your deficit prediction is based on the assumption that the nation was not at a structural crossroads by the fall of socialism in 1989. It is based upon the assumption that american productivity will continue as it has. But neither the society we call america, or the advantage that was western, or the advantage that was american, persists any longer. We are in for another decade of this economy, and if history is any measure, we are also in for something unpleasantly disruptive in the next generation. And neither side has a plan for getting us out of it.

                  • “What do you think about China?” I Think You Are Confused About The Virtues Of Political Systems

                    Kenneth V. asks:

                    I’m curious about your opinion on China’s future. As the democratic empire collapses in the west and power shifts its balance, do you think that the Chinese people will demand more political freedom, especially since libertarian books are bestsellers? Or do you think the oligarchy will be successful in suppressing dissent? What do you think of the demographic trends there? Chinese couples do a trial-and-error with childbirth where babies who are less than perfect are killed. The massive gender imbalance of 40 million more males than females. What do you think of this kind of extreme eugenics? I personally find it abhorrent, but I’d like to ask your opinion.

                    Ken, The Chinese are driven by the conflict between northern government, southern trading prosperity, interior poverty, and hostile borders. The cultural tradition is ancient and it’s purpose is to avoid civil wars at all costs, simply because civil wars were so common for them, because they are exposed to what they see as threats (their country needs the china seas open in order not to be starved into submission), and because of natural conflicts between the regions. This history is as important to china as the sense of freedom is to the west. (a sentiment which is in no small part a reaction to the middle eastern model – which westerners considered horrid.)

                    [callout]I suspect that they will never achieve the middle-class society as we understand it. They will bypass that phase of development. They will go from totalitarian rural poverty to totalitarian urban poverty, and maintain their corrupt bureaucracy. The reasons for retaining that bureaucracy will simply evolve to support a different set of objectives.[/callout]

                    Now, to avoid drinking our own Kool Aid, we probably should understand that the west has always had an advantage of being a society filled with craftsmen rather than laborers, not the least of which was the result of widespread metal smithing, easy river trade, and the western agrarian cycle which was very seasonal. The importance of that sentence may not be obvious to you unless you think of the 360 day a year job of a rice farmer. So Romans conquered northern europe because the ‘barbarians’ were fairly wealthy by contrast, and presided over resources. While they exploited the warmer climes for food. But western wealth over the past 500 years, has largely to do with selling off the american continent to immigrants. Not to any particular western genius. IN fact, the continental view of exploiting the continent as they had the islands, by bringing resources back home paled by comparison to the money that could be made by settling, populating, and selling consumer goods to immigrants to the north american continent. In this broader context, our political order is more dynamic, and by that I mean, flexible, and the republican model with capitalistic institutions (for cooperation) is the only one that is effective for mobilizing enough people to accomplish such a task. China by contrast is simply doing the same thing without inventing it: they are selling off apartments, electricity, water, and food to immigrants to the coastal cities. Their model is better for doing their migration under their circumstances. Our model was better for doing our migration under our circumstances. The question is, for them, for us, what will happen when that’s done. Because we are going to have very densely populated cities, and in that model FARMER ETHICS AND MORALS EVAPORATE. Traditional religious principles, ethical constructs, and the ability to manage class differences become very difficult in those environments. The difference is that the chinese have the benefits of monarchy (long term thinking), the capital concentration of totalitarianism (which is very useful) and the institutions of capitalism (banking, finance, accounting, interest and credit, western laws), and they get to profit on the implementation of western technology – without having to have had to discover it. This is a very good model for competing externally. it is not a good model when you’re the ‘winner’. It’s a very good model for when you’re a century and a half behind the rest of the world. I suspect that they will never achieve the middle-class society as we understand it. They will bypass that phase of development. They will go from totalitarian rural poverty to totalitarian urban poverty, and maintain their corrupt bureaucracy. The reasons for retaining that bureaucracy will simply evolve to support a different set of objectives. But the damage that they will cause in that transition, to the world in general, if they are faced with uprisings, is substantial. I think your question begs the wrong assumptions: political models are utilitarian goods, not absolute goods. Societies need to concentrate capital in order to compete and cooperate with other societies. Then they need internal institutions for everything else. Complex market capitalism when combined with totalitarian command of large investments, with the least corruption possible is probably the most competitive form of political order. As long as investments are competitive rather than redistributive. Redistribution is the result of competition. Not a replacement for it. There is no inherent value in political freedom on its own. It’s not a virtue. It is an acceptable risk in a homogenous society. But it is a net danger in a pluralistic society. The struggle for power must never be available to factions or minorities. Only the struggle to compete in the market. Political freedom is the freedom to usurp the market. THere is no other reason for it. The only value of political freedom is in reducing corruption, which is an impediment to trade, exchange and capital formation. The problem for a people is suppressing corruption, not obtaining political freedom. People don’t really choose their political system. It’s determined by their circumstances and they are pragmatic in adopting it. They don’t pick idealistic things, and if they do, they fail (Iran). Democracy is just slow moving communism. As Schumpeter said, Democracy will just lead to socialism. Republicanism and oligarchy are rule by the middle classes (trade). Totalitarianism is rule by the upper classes (force). Theocracy by definition, rule by the lower classes (fraud). (IQ and Atheism increase with class structure, although under capitalism moral behaviors tend to emerge with the decline in religiosity.)

                  • Question: “Can you be anti-capitalist and pro market?”

                    On Straight Dope, there is a thread on whether one can be anti-capitalist but pro-market. I’ve captured my response below. DEFINITIONS 1) Capitalism (distributed planning and control using the technologies of property and the pricing system). Or politically: a bias toward letting the market solve problems of production. 2) Socialism (centralized planning and control in the necessary absence of the pricing system). Or politically: a bias toward political centralization of solving problems of production. 3) Mixed Economy ( distributed planning and control using property and pricing system, with redistribution of wealth through taxation). Or politically, letting the market solve problems of production, while centralizing some amount of the wealth generated for redistribution and investment in outcomes where the market process is unable to concentrate capital. 4) Market: the voluntary production of property for the purpose of speculating on it’s voluntary trade. The speculative pricing assigned to the goods or services. The reliance upon prices to determine the products to be produced, and the factors of production to be consumed. Implies the regulation of products into the market. and implies the defense of property rights and conflict resolution within the market of goods and services by a third party. 5) Trade: the voluntary transfer of property from one individual to another. (which implies knowledge of the purchaser, and the irrelevance of third parties) DISCUSSION Early Leftist were traditional luddites who confused the necessity of ownership of the means of production (property) with the ability to redistribute the results of that system of ownership: It is not necessary to control the means of production in order to redistribute wealth. While property and prices are necessary for complex production, and incentives are necessary to encourage people to produce, it appears that we can determine rules of property use, and we can determine some level of redistribution while maintaining sufficient incentives to produce. At least, that has been the general course of events over the past century. Contrarily, unstated but implied in that statement, such a redistribution will affect the ability to consume, but not ‘organized control over’ what is produced. This may disappoint some. However, since all groups are led by elites and elites must make decisions on production, the such centralized control creates only the illusion of proletariat control over what is produced. You cannot have a market (speculative production in anticipation of trade wherein prices communicate relative demand) without prices and property. This is logically impossible. While communists have forever posited the opposite, people will not produce excess for market purposes without the incentive to do so (and will resort to black markets, and therefore recreate the market). If what you define as “anti-capitalist” (i suspect) is having a number of people with knowledge and relationships and control of property concentrate resources toward productive ends that you disagree with, then you can indeed be “anti-capitalist”. If you define anti-capitalist as a status-criticism, wherein you dislike the fact that you are most likely a permanent member of the proletariat, which decreases your access to mates and opportunity, then you indeed can be an ant-capitalist. Those are sentimental objections. (Despite the fact that our society is largely run by the middle class and upper proletariat.) But if you mean that you dislike the nature of prices and property, then you’re just illogical, and the result of your beliefs would result in destitute poverty, murder and war. The market evolved because of the limitation of the human mind. We cannot replace it without making the human mind far better than it is. And perhaps far better than it can be. Redistribution is a biological sentiment in the human animal that evolved because it is necessary for group-persistence: to retain competitive ability against other groups, and to insure the group’s survival. Universal egalitarian equality, which is a member of the set of leftist sentiment of “harm/care/nurture” or the sentiment of eliminating the sensation of status differences, or the sentiment eliminating the material differences between people’s access to resources, is simply an illogical construct regardless of which sentiment is being applied: Because we need incentives to produce, and we must over produce and divide our labor to reduce prices. (“We are not wealthier than cave men, everything is just infinitely cheaper due to the division of labor”) Because people will always seek status differences even under socialism. Because the iron law of oligarchy mandates that elites and leaders emerge, and once they emerge they form a self-serving bureaucracy. Because it is impossible for more than a family sized group of people to agree on both the means and ends of doing anything meaningful in a division of labor sufficient to produce low prices. (this last, is the virtue of what we call the market). Participating in the market is also voluntary. One can consume the goods of the market without participating in the market one’s self. Some people, in fact, a majority of people, are not sufficiently competitive in any form of production that they can conceive of, or afford to speculate in the market. So they TRADE their productivity rather than SPECULATE on by producing goods or services for the market. To be a member of a market economy, one only needs to refrain from theft. To be a ‘good’ member of a market economy, once needs additionally to refrain from fraud and deception. But these are the means by which we obtain citizenship in the market, not participate in the market. To enter the market itself, means that you risk capital and compete in the arena that is the market, and are willing and able to accept losses. The problem for the proletariat is that their value-system is predicated on self-production for consumption purposes, and trading for goods that cannot be self produced. People only a century ago would put to market only their over-production, and purchase from the market only for goods that they could not produce themselves. Except there is precious little in modern society that a person can produce himself, let alone, produce for market consumption himself. This necessitates an uncomfortable uncertainty for those people who must speculate in order to survive in the market. Hence leftist sentiments of the family, epistemology of the family, organization of the family, production of the family must compete with rightist sentiments of the market.

                    [callout]It is quite likely that the right and left will both fail. That we will instead of succeeding in incorporating all people into the market (the error of the right) or incorporating all people into the luddite familial structure (the error of the left) that we will adopt the european and south american models of a wealthy urban and rural groups, and a ring of abject destitute hyper-breeding poverty around the urban cores, wherein the upper and middle classes pay the permanent proletariat just enough to subsist, and we emerge with a tiered society both geographically, genetically, and materially. [/callout]

                    It is quite likely that the right and left will both fail. That we will instead of succeeding in incorporating all people into the market (the error of the right) or incorporating all people into the luddite familial structure (the error of the left) that we will adopt the european and south american models of a wealthy urban and rural groups, and a ring of abject destitute hyper-breeding poverty around the urban cores, wherein the upper and middle classes pay the permanent proletariat just enough to subsist, and we emerge with a tiered society both geographically, genetically, and materially. And this end result will in no small part be due to the christian error of egalitarianism sentiments that deny the productive differences of human beings in the real and material world – the majority of which differences derive from the ability and rate at which one can learn and apply abstractions (IQ) in a dynamic and rapidly moving economy. While neither left or right can achieve it’s idealistic ends, leftism is an attempt to enslave the productive (innovative) class’s attempt to increase production and increase prices for the purpose of status enhancement. But by that restraint doom all people to poverty. This is the strategy behind all monotheistic religions. They are resistance movements that attempt to make status among the proletariat a spiritual rather than material construct. Capitalism (or right-ism) on the other hand is an attempt to keep sufficient productive resources in the hands of market producers that all society benefits, despite the fact that the proletariat feels increasingly left behind and deprived of status because of the accelerating rate at which the productive classes (those who take speculative risks and thereby increase choices and decrease prices) seemingly depart from the lower classes, despite the fact that in all but the rarest circumstances (catastrophic health care) that the difference between the quintiles is one of symbolic status and diversity of forms of entertainment, rather than differences in material well being. As it stands Quantitative Keynesianism is the socialist research program, and Anarcho capitalism is the capitalist research program. The difference between these methods lies in both their ambitions and their methods. By applying 19th century advances in the mathematics of the natural world (closed probabilism) to the aggregate symbols of production of the economy (monetary values), it became possible to try to fulfill some methods of the socialist program by using capitalism for socialistic ends. The problem for the capitalists, and the reason for the failure of the Austrian (qualitative) program’s emphasis on micro-economic behavior, is that they do not have a method of mathematics to provide sufficient explanatory power equal to the left’s program, despite knowing, with absolute certainty, that the Keynesian program must fail. This is because despite the efforts of Poincare, Mandelbrot, Hayek, Popper, Mises, and Parsons, more recently Taleb, and a host of others, there appears to be no symbolic language that can represent the plasticity and organic behavior of the property-pricing system and how it reacts to human knowledge. (This is typically called ‘Hume’s Problem’ of Induction.) It appears, at least at this point in time, that we will need a vast amount of data, on the order of many times that of the Google indexes, to provide us with enough of a basis from which to derive the patterns in that symbolic information. Even if we could find that information, we could find the patterns, and develop a mathematics of economics and the social sciences, the question would remain whether these innovations would have any material impact on the fact that humans are of pedagogical NECESSITY, epistemic status seekers, and that there are those who lead that pack of humanity and those who are forever followers in it, and the envy of the followers, and the arrogance of the leaders mandate that we will remain competitive, and that the problem of human difference is both permanent and valuable to the division of knowledge and labor.

                  • From Modeled Behavior: On The Religions Of Positivism, Secular Humanism and Monotheism

                    Karl Smith, writing on Modeled Behavior, in response to Ron Rosenbaum falls into a rational argument between theism and atheism. And demonstrating that both he and Rosenbaum err. Even the early theologians did not make this mistake. Religious debate is allegorical, not scientific. Only fundamentalists argue for the sicentific basis of gods and religion. And fundmentalism is a political reaction to the rise of science in politics. However, neither side of this populist debate (and it is a populist debate, not an intellectual one) has much to offer. Karl says:

                    Ron Rosenbaum launches a long and varied attack on the New Atheism. His complaints are many and his tone heavy, but I don’t think I do him much injustice by saying his central claim is this:

                    Atheists have no evidence—and certainly no proof!—that science will ever solve the question of why there is something rather than nothing. Just because other difficult-seeming problems have been solved does not mean all difficult problems will always be solved. And so atheists really exist on the same superstitious plane as Thomas Aquinas, who tried to prove by logic the possibility of creation “ex nihilo” (from nothing). . . In fact, I challenge any atheist, New or old, to send me their answer to the question: “Why is there something rather than nothing?” I can’t wait for the evasions to pour forth. Or even the evidence that this question ever could be answered by science and logic.

                    If Rosenbaum means that he wishes us to explain the “universe” then we should talk about the properties of high density energy and the creation of bubble universes. Or, we can tell a story about 11-dimensional membranes which may have collided and produced everything that we could ever see. However, I think the Rosenbaum wants more than that. I think he doesn’t want to stop at our universe but wants to ask – from the outside of everything in the moment before the first event – why did it become so?

                    Actually, that’s a false premise he’d be arguing if he did. The question he’s really asking is “what are the implications for my anthropomorphic anthropocentric view of the universe. In other words, how can I make this universe about the creature man rather than a universe in which man is not central, and in fact, may be an improbable accident? That’s the question he’s asking and the problem he’s seeking, becaus that is the comfort that religion brings to man: anthropocentrism. But that anthropocentrism also adds value to political discourse. Because ANY ANSWER includes a proscription for human behavior. I think we forget too often that the purpose of religion is to provide an inexpensive means of proscribing behavior for humans who must coexist in large numbers. Externalizing requirements as scriptural is simply an inexpensive means of lawmaking.

                    However, there simply is no sense to be made of these propositions. Equally, there is no sense to be made of the question “why is there something” that is unless Rosenbaum is using different definitions of “why” and “something.”

                    This just misses the point. It confuses truth with utility, and in politics these things have no relevance.

                    Now, if I don’t believe that science, reason or logic can answer “why something as opposed to nothing.” Then what do I mean when I say that I am an atheist? I mean that I believe all answerable questions can be answered with science, reason and logic. Said slightly more formally, there exists no question which can be meaningfully answered that cannot be answered by science, reason and logic.

                    Lets return to Rosenbaum’s query to see how that works. He asks “why is there something” The theist might answer that God created the something. But, then the theist must be referring to a limited set of something. Indeed, typically we imagine the theist as referring to the physical universe, space, time, etc.

                    Well, you’re making an argument against his STATED reasoning instead of his UNDERLYING reasoning. And, as Pareto, Weber, Michels, and Sorrel will remind you, this is YOUR error, not theirs.

                    Now, does my belief in science, reason and logic constitute a faith? No.

                    Perhaps. But your use of logic for the purpose of political debate is pretty ameturish.

                    First, I have evidence for the belief. Predictions based on science, reason and logic tend to come true.

                    Oh no. You don’t realize what youve stepped into here. In fact, you’re making the EXACT mistake that your opponent is. You have incomplete knowledge and the process you follow may yield consistent results, even if you do not fully understand the process. The process of religion and belief in god produces consistent results, even if that process is irrational. In fact, in the history of science, those predictions that exist int he physical world have largelly been false, and tehrefore they are scientific but wrong. The problem with the sphere of human action is that we know less about it than we do the physical world, simply becuase itis more COMPLEX than the physical world, because humans can LEARN.

                    Indeed, I am not currently aware of a case where they have failed to come true and no subsequent reasoned explanation was found. So the trio of science, reason and logic carry with them an incredible track record.

                    Phlogiston theory? Aristotle’s motion? The human genome project’s assumption of a manufactured man rather than a grown one? The limits of Aristotelian, Newtonian and Einsteinian physics?

                    However, this track record could plausibly come to a halt. A pillar of fire could appear before me and declare that he is the lord. He could then go on to predict the violation of the laws of physics and subsequently show them to be false.

                    Or we could find that the mythical structure is a very useful pedagogical contrivance and that the unarticulated content of these myths contains devices for assisting people with cooperating in agrarian society and in a division of labor and knowledge, where the limits of their perceptions and knowledge in a complex society exceed their tribal biological capacities. This is actually what’s expressed by the content of most of the christian mythos and dogma. Now, conversely, there is a great deal of incredibly destructive content in the monotheistic religions. One could successfully argue that they institutionalize ignorance. The appear to institutionalize poverty. But they appear to spread like a virus along with the underclasses. But they do serve their purpose, which is to override tribal sympathies and sentiments, and essentially create a new tribal identity, while preserving of class systems. Some are simply far worse than others (Islam). Some are useful despite their ridiculousness (Judaism).

                    He could show me that despite all of my reasoning to the contrary that 2 + 2 = 5, that the logic I depend on explains nothing and that my confusion of this moment tells me nothing about my confusion in the next. Every prediction I make would have results no better than chance but every prediction the pillar makes would come true.

                    Any number of fairly great minds have pondered this problem at length, and you’re really not even scratching the surface at the level of an undergraduate. I’m not trying to be antagonizing, I’m just stating the obvious. There are volumes on this subject.

                    [callout]The only reason for this debate, is for the purpose of coercing someone to do with himself or his property what you wish, against his desires, without compensating him with something for which he would willingly part with it.[/callout]

                    “Gods exist like numbers exist”. They exist because people act like they exist. People use them in the same way: to calculate. To reason. To estimate. To judge. We lack the knowledge, the experience, the perception, the time and computational ability to exist as a polity in a market, in a division of labor, without them. The question is the form of their existence. Do they have the properties that people attribute to them? No, but neither did shakespeare or Socrates, Washington or Alexander. Edison or Michelangelo. Marx or Machiavelli. And the existence of these concepts as memories, as memes, and as complex symbols have extraordinary long term impact on individuals, groups, cultures, and civilizations. Science is, and always has been, a ‘faith’. Scientific knowledge is the most perishable that we have. Entire bodies of knowledge have expired with one innovation. It’s pretty certain that thousands more will do so. Certainly, we are fairly sure, that we are missing something very important at the subatomic level. Certainly we are very sure that we are missing something very important in the human experience: hume’s problem of induction. Certainly there is something wrong with out entire concept of mathematics. Certainly our belief that the genome project would deliver to us vast knowledge, but in the end, only confirmed our ignorance. Science is a formal process for discovering patterns and replicating them. It is a process. That is all. What we know from science is that which is falsifiable – the negatives, not what’s ‘probable’ – the positives. Science is largely eliminative. But scientific knowledge is constantly open to further revision, greater explanatory power, and the elucidation of error. It is constantly being disproven. Contrary to our religious wisdom, science is egregiously more perishable. In economics in particular, vast swaths of our knowledge is patently false. THe entire DSEM model appears to be false. One should separate fully articulated reasoning from the results produced by it. Our politicians rely upon what they believe is scientific thought, and it is articulated as a rational process, even if with competing means and ends. But they have made a terrible mess of the world economy because they believed Nobel laureates – some of whom are being disproven at this very moment, for reasons that most of history’s philosophers would have stated were obvious, as violation of the calculus of measurement. By contrast the church built a vast bureaucracy that governed europe for nearly two millennia and did exceedingly well at it, despite the fact that it’s dogma was absurd, and methods of argument laughable by almost any measure. Plenty of religious doctrine is simply well-though human behavior codified as the word of god. Sure the reasoning behind it is ridiculous. But it works. Wisdom is generalization. It is rules to apply when facing the unknown. But largely, wisdom is our protection against ignorance and hubris. Warning against Hubris in all it’s forms is the primary teaching of the body of greek mythos. THe fact that it’s conveyed by the allegory of the gods is simply a pedagogical device. Secular humanism is as much a religion as is any other silly set of beliefs. Humans aren’t that plastic. The greek myths are just as important a set of lessons as are fairy tales, and the two sets of knowledge may be more useful than all the knowledge that science bequeaths to us. The most important question is this: The only reason for this debate, is for the purpose of coercing someone to do with himself or his property what you wish, against his desires, without compensating him with something for which he would willingly part with it. In other words, these are political arguments. As political arguments, like all law, they are practical, not truthful. THey are for the purpose of persuasion. And the only reason for political persuasion is to redirect resources and energies from where they are, to wehre you want them to be. And as such, political, pseudo-scientific, religious and moral arguments are nothing but feints and parries in a fencing match. And you, the spectator, are simply distracted by the hand-waving prestige of the magicians on the sidelines. Numbers exist. Gods exist. Science exists. They exist in the same form. As ideas. And the only reason to debate them is to lie, cheat and steal. Because otherwise we would simply engage in mutually beneficial trade. Then another person enters the conversation:

                    Curt. Lots of words and hefty references, none of which support your thesis, which I take to be: “But belief in the scientific method, particularly in the social sciences, is entirely erroneous.” Science is empirical, faith isn’t. The scientific method is an attempt to understand the real world based on the measurable properties of the real world. The only faith involved is that the careful use of the senses and invented measuring devices is capable of giving real information about real things. If that is wrong, they we all might as well believe in unicorns. The concept of “social science” is less valid than “natural science” because a collection of people is more different, and in a greater variety of ways than a collection of oxygen molecules or green beans. Hence, the use of probability becomes problematical. Let’s not even go there. Faith involves belief in the unprovable. Science is a search for what can be proven. You might not know this, but before Adam Smith wrote THE WEALTH OF NATIONS he wrote THE THEORY OF MORAL SENTIMENTS. Which, like the writings of Keynes, is totally irrelevant to the discussion. Cheers! JzB

                    Curt Doolittle You made my point. Thank you. Empiricism is a ‘faith’. So is Positivism. A positivist or empiricist puts his faith in the process that he uses. A theist puts his faith in the process that he uses. We know that much knowledge provided by these processes is false. But we know that we obtain utility from using these processes, despite their imperfections.

                    [callout]Empiricism is a ‘faith’. So is Positivism. A positivist or empiricist puts his faith in the process that he uses. A theist puts his faith in the process that he uses. We know that much knowledge provided by these processes is false. But we know that we obtain utility from using these processes, despite their imperfections.[/callout]

                    Religious ‘Faith’ is a political and social concept, and social content is NOT probabilistic. It CANNOT be. We can debate wether in retrospect we can measure correlation of historical data. But human behavior is only correlative and historical. It is not probabilistic and predictive. The fact that legions of positivists fall into the trap of treating empiricism as a truth rather than a method, is no different from the error that theists fall into when they think faith is a truth rather than a method. Knowledge is not finite. It is not static. Knowledge is embodied in our methods, not in what is static and certain. And, contrary to your accusation, all of my references support my position. Almost everything here is just Popper revisited. And popper along with Kuhn is the author of the philosophy of science, as well as much of the theory of knowledge. Popper argues for an open universe. He argues (along with Godel) that we have made a mistake in the calculus of measurement. Nassim Taleb make the same argument and warns of the fallacy of prediction in financial markets. Hume argues that we cannot know what we do not know and correctly posits that this is the fundamental problem that humans must solve. Kant tries to solve the problem and fails miserably, although artfully by trying to create a closed (chrsitian apologist) system. Weber refers to content of religious concepts. Pareto describes the limits of human knowledge and the human reliance upon sentiments when faced with insufficient information by which to make decisions. Hayek warns us about the limits of knowledge, and that we should not debase traditional knowledge. Michels warns us that bureaucracies must possess limited knowledge and therefore become self serving. Mises makes the same proposition in ‘Bureaucracy’. Conversely, the line of probabilists from Walras to Keynes to Samuelson all argue for probabilism, but all their models are demonstrably false in practice. They are false in practice for this reason: the categorical representation of any measurable object of utility is necessarily erroneous because the UTILITY of any object is plastic or polymorphic. Unlike the physical world. And therefore it is the DIFFERENCE between possibilities that is the real, and therefore, hidden cost of all human behavior. (All costs are opportunity costs.) Therefore we only record and quantify history but not our hypotheses, because the hypothesis is unimaginably complicated and purely mental in construct without external representation and therefore not readily open to categorization and quantitative representation. Likewise, (via Mandelbrot) people and markets react to learning curves and forgetting curves. The greater and more frequent the stimulation the more attention it gets, and the less the less it gets. This is the only logic present in the stock market: frequency of stimuli and the plasticity of the objects traded in reaction to that stimuli. There is a vast body of knowledge that is critical of the philosophy of secular humanists (which is the religion you’re a member of). The point is, that you are confusing TWO DOMAINS OF KNOWLEDGE that are critically analyzed by different METHODOLOGIES and committing an ERROR in doing so. The gains from science are in the PHYSICAL non-heuristic fields of DISCOVERY of an existing and CLOSED system. The gains in the political sphere are horrendously more complicated than that of the physical world and far less open to our method of scientific testing as we currently understand it. And our current understanding is limited by the somewhat linear and non-causal, categorically implastic mathematics that we make use of in our analysis, exposition, and prediction. So in making your argument with me, and with Rosenbaum, you are applying an irrelevant standard to the concept of god. ( And it’s an impossible problem to define these things rationally. Social Good is one of my favorites. So is the french “liberty fraternity equality”. They are meaningless terms. They express sentiments, not reason. If “social good” exists, then god exists. Good luck defining either one of them. And without defining them you cannot argue a position. ) So, you’re making an ERROR, the nature of which you do not understand. Science is a method. What you do not see is that religion is a method. It is an argumentative and philosophical method for the resolving differences between ‘shoulds’ and achieving cooperation of large numbers of people in a vast division of labor, and among vastly different people of different ages. And achieving that vast labor where rational pedagogy (reason and science education) did not exist, or where it is insufficient (where we are too ignorant), or where the people are too limited in ability, or konwledge, or time, to make use of rational means. Or where, because of the pragmatic nautre of politics, reason, which is an elitist tool, is not available to the majority of the polity engaged in decision making, especially in a democratic society. Reason is a poor political tool. People need narratives. And we have not YET produced sufficient narratives under empiricism to replace mythic content. And the narratives that we have produced (which are those of secular humanism) are patently FALSE. Secular humanism posits: 1) People are equal. (They are unequal) : IQ Deniers. 2) Everyone can be of the same social and economic class (they cannot) : Class Deniers 3) Race is immaterial. (Races are material because people act as if they are material, and they act that way because status in-group and extra group is achieved at different costs) : Race Deniers. 4) Infinite Plasticity of Humans (Natural Law is correct in that people have permanent tendencies) : Anthropo-implasticity Deniers 5) Limits to Political Consensus On Means Of Achieving Goals : Democratic Limit Deniers 6) Limits to empiricism and Probabilism In Human Behaviors : “Positivists”, or Limits Of Empiricism Deniers. These are all failures of the religion of secular humanism, that is the result of empiricism. The great thinkers alive today would state (because they do) that they are not trying to solve a problem of objective truth but of practical utility, while understanding that scientific thought is very limited in scope. The fact that you do not take this same position of skepticism, and that moreover you ignore the record of the history of what utility that civilizations have gained from the absurd technology of monotheism, means that you are indeed a member of the positivist ‘faith’. The monotheistic religions are ridiculous as stated. But they are terribly successful algorithms. Much of science in human history has been well articulated, but entirely false. That said, I’m not supporting monotheistic religion but I do understand the problem of pedagogy: 1) children must learn symbolic social judgements by habit and narrative before they have the capacity to understand rational judgements. 2) people are vastly unequal in their ability to make rational judgements. In fact, it is an expertise and a product of life long mastery. 3) reason has been demonstrably ineffective compared to law and religion and credit, in creating social order. Largely because it is so susceptible to error and fraud. Reason is insufficient and the narrative method and allegorical content are a superior means of providing actionable content to human beings of different abilities, different ages and different experiences. We live in a vast division of knowledge and labor, with multiple social classes, multiple mythologies, and multiple forms of social cooperation encoded in different categories of property rights, freedoms and constraints. Science is the process by which we slowly chip away at discovering fundamental objective causality. But as it stands, it is insufficient for the composition of a social order. And it has been demonstrably harmful to apply such standards to the social order in the vain assumption that our traditions err. =====

                    Curt, Impressive.

                    “Politics is a process of utility not truth. And the only purpose of debate is to obtain another’s property for one’s desires rather than theirs. By inventing politics we traded violence for fraud. ”

                    Shouldn’t this be: property is theft, war is struggle over it, politics negotiation on it, and trade exchange of it? In war, might makes right, politics lowers the cost through the fraud of property, which trade can then exchange. Even the prehistory is reversed. Politics can reduce war, and trade can reduce politics, but larger populations, densities, and interactions increase politics and politics increase war. -Lord

                    @Lord. First, thanks. Second, your summary is both astute and accurate. Although, the form you’re using (which is the civic republican set of assumptions, and assumes equality) employs a neutral point of view, and the form I’m using (which is is machiavellian politico-scientific which assumes inequality) is intentionally constructed to demonstrate the error of applying the criteria of either religion, science, or philosophy, to the field of politics — when the first three presume a search for objective truth, and the latter is the domain intentional rhetorical fraud for the purpose of obscuring the contests over property and masking the facility with which the bureaucracy exploits it’s position for self gain behind the necessity of implied moral contrivance, and political expediency. In other words, I’m assaulting the assumptions upon which republican government are based. So I was chastising the authors for silliness by stating that the only reason for debate is to mask their attempt at taking each other’s property. But back to forms: The civic republican model is based jupon the assumption that public debate and voting will produce optimum use of resources among people with similar interests. However, this model originated with small populations, with a minority of the productive social class of participants, with hard money, and where these politicians possessed similar economic incentives, and where the agrarian model, and sail-based shipping guaranteed long time frames for decisions, and accounting periodicity, and where production consisted of fairly simple products converted from a resource to a consumable. All of wich allow for fairly simply accounting processes, and limit the bureaucracy to what can be borrowed from external entities, and therefore what non-bureaucrats are willing to subsidize. Today, instead, we live in an industrialized world of multi-part products composed from across the world, with complex human capital requirements, and vast differences in price structures, and where the rate of movement of economic forces is incomprehensible to an individual. (And where it is precisely that incomprehensibility that makes socialism impossible – socialism being management of production, but which is now commonly applied to redistribution.) Further, we live in a world where the government is both a domestic and international empire that abuses multiple groups under the auspices of shared benefit, while bankrupting the civilization on scale unimaginable by the Athenians. Where politicians do not read, and cannot even understand much of the law that they pass. And where, having removed the gold standard, and allowed the pooling of financial information both through taxation on the way in and lending on the way out, we launder all ability of individuals to comprehend the instructions we give each other through the pricing system, both temporal, and inter-temporal. And by this laundering, and loss of the boundary held in place by hard money, have removed the only means by which external wisdom can limit the ignorant politicians, and the corrupt and ideological bureaucracy. So, In practice, debate is fraught with fraud. There is nothing dishonest about violence. ie: we have traded violence and the use of the parliamentary system to protect us from undue violence by the king and unite us in that pursuit, for fraud, and the use of parliamentary drapery to subject us to extortion and class warfare. So, in practice, yes, you are both succinct, and correct. But you’re not providing the reason why – and as such, are positing a memorable solution but one easily dismissed. The reason you’re missing out on is an epistemic one: That the government is large enough, over too divergent a set of interests, and our pricing, accounting, tax and law systems inadequate to provide politicians with the information necessary to make decisions about the matters with which we charge them, and possessing levers that are too imprecise to achieve their desired ends. In this environment of inadequate information, bureaucrats have no choice but to rely upon metaphysical and cognitive biases when making decisions. And because law makers feel the need to make laws, they do so, and poorly. And because laws do not perish with the fools that write them, the are calcifying the body of law, and as a byproduct losing the faith of the populace not only in them, but in rule of law itself. Politicians are not evil. they are merely human. And they are unable to synthesize sufficient information about our state of affairs to make rational judgements because our information systems are insufficiently complex enough to allow them to do so. Consequently, rhetorical debate is easily fraudulent under this system because there are no external checks and balances via credit and hard money, vie minority vote, vie accounting, on the politicians or on the bureaucracy. And in this arena a fraud, debates about religion, science, and the like are ridiculous. They are ridiculous first, because they are insufficient means of solving the problem, and second because the only reason you would need to rely upon them is because you lack rational, scientific, quantitative information, OR are not regulated externally by limits to credit, and as such, one must resort to Morality, Beliefs, Preferences, instead of resorting to facts as established by monetary information and access to credit. Personally, I would much rather than we stop debating the virtues of science or religion, because both are falsehoods, and instead discuss implementing schemes by which we improve our accounting, tax, credit, baking, and forecasting abiltites so that our politicians cannot hide from information, or make obviously erroneoius statements about fianances. And if christians want to do some moral good, stay off the biblical quotes and get onto the real issue: economic calculaitno is now impossible for our governemnt, and teh tools we thought we had, in the Dynamic Stochastic Equilibrium Model and the ambitions of full employement under Keynesianism are profounding erroneous, ans simply a schme by which we have dstroyed western civilizatoin and force our politicians to resort to chicanery, fraud, ideology, ignorance, and pettiness. The bible, and all scriptural religion are allegorical wisdom.They are not science. Even Science itself is inapplicable to the social sciences. And as such neither religion or science is sufficient to replace ‘quantitative information’ given to us by the system of prices and credit. Because the only truth we know of, is the truth men tell by their actions with their money.

                  • CONTROVERSIAL REALITY : A CONTRARIAN’S VIEW OF THE AGENCY, BUSINESS AND SOCIETY

                    AdAge and The Decline In Car Driving Among The Young The advertising industry’s most important publication, Ad Age, recently posted an article entitled “Is Digital Revolution Driving Decline in U.S. Car Culture?” wherein the author describes the decline in driving among the young, and the readership leaves comment after comment positing reasons for the change, most of which belie political sentiments. This kind of economic commentary can be found daily on any economics blog. And it’s fascinating to see the difference between the interpretations of different subcultures of the same data. Economists make fewer errors in their reasoning. Reporters try to create sensationalism and readership by appealing to the common errors that people tend to make, most importantly the error of confirmation bias : seeking what you agree with and ignoring what you don’t. Humans demonstrate a cognitive bias wherein they overestimate their own ‘normalcy’, or how likely people are to think like them. This is particularly true of people in the agency business for a variety of reasons – and thinking otherwise might not necessarily be beneficial to one’s career in the agency business. This business is a ‘magnet’ for group-thinkers, because the profession requires that you think about ‘groups’ for a living. THE REALITIES OF CITIES Most people in history were confined to 20 mile arduous around their home. Cities are, and always have been, notoriously dirty and noisy, often crime ridden, and push people into small spaces from which they desire ‘vacations’. (The Un-Heavenly City by Banfield.) In a recent conversation I had with a Chinese intellectual I was surprised at how little he understood the ‘toxicity’ of human beings living in density. It’s hard on them. (Selection in urban environments comes from disease resistance. – Plagues and Peoples by McNeil) People like density because it decreases opportunity costs – everything is close-by and because it’s dense, businesses and services are better capitalized and better funded because they have a higher opportunity of being funded – as long as they don’t require much space, or as long as what they sell is expensive enough to pay the cost of that density. But because of the expense of that proximity, raising children is for the poor who have no other choice but to live in kennels where the cost per human is low, and the wealthy who can afford to make the choice, not the middle class, who must live elsewhere. Therefore, Cars and Suburbia Are Synonymous. Because costs of a the quality of residences decrease with distance from urban centers, allowing more space at lower cost. Most urban downtown cores are surrounded by slums. Paris, Vienna, NY, Chicago and most impressively LA. Most dense urban areas outside of the west are almost entirely slums. London seems to have done a better job of controlling it’s development than most other cities. The reason for this is simply a tragedy of the commons that occurs when people move into very high density. It’s fixable with serious political effort, but there is a high cost of projecting that effort. WHY PEOPLE DRIVE CARS People drive cars because 1) Increasing opportunities for experience (we all this ‘the sense of freedom’) 2) Increased opportunities for mating outside of one’s group (this is obvious) 3) Permitting distance between home and job once jobs industrialized 4) Permitting the easy transpiration of ‘stuff’ to one’s residence 5) Ease of childrearing, especially once women enter the work force. 6) Increasing Leisure Time not spent traveling. 7) Status – because status will always be with us, because it determines access to mates, jobs, opportunities, knowledge and experiences, and because people are imitative and need a way of knowing what to imitate in order to get attention, opportunities, and mates. CHANGES IN DRIVING BEHAVIOR The actual reasons for the shift In Driving: 1) Cheap credit inflated residential prices, mortgages and rents. Wages were stickier, so young people whose primary social function is mate-seeking chose urban locations in exchange for car ownership and geographic freedom. This phenomenon will change once they find mates and seek suburban life for their children, as well as increase their household incomes by marring. So in other words, preferences will not change, just demographic distributions. (Just like political preferences.) 2) Unemployment over the past two years has decreased the tolerance for high fixed costs and younger people are abandoning or delaying the luxury of driving. They are just delaying it, and will reverse it when possible. 3) It’s a lot less ‘boring’ to stay at home when you have so many forms of entertainment available. 4) People live in increasing density, so that the need to travel in order to ‘sample’ enough people to identify friends and potential mates is lower, and to some degree is simply easier on the web. 5) Increased Populations Of Immigrant Urban Poor and their children who are most likely to consume public services, and least likely to have risk capital available for automobiles. These aren’t in any order, but I’ll leave it to the reader to determine the impact of adding 30M people over a 20 year period. PUBLIC TRANSPORTATION Public transportation has a statistically insignificant to statistically minor impact on commuting everywhere except New York City. In fact, NYC is so dominant, that it skews the entire country. If you remove NYC from the analysis then the dominance of car culture is obvious. By contrast, many rail systems (Portland Oregon for example) are catastrophic losses, and suffer from insufficient ridership to cover the costs. In europe people do not own homes, they rent and save. National cultures are also more homogenous. People are gregarious in homogenous societies and isolationist in heterogeneous societies. Contrary to what is commonly believed. Diversity decreases willingness for public investment. Everywhere. in general, if a people can afford the independence of a car, in any culture, they adopt it. That is what the statistics illustrate, and there is no evidence that that preference will change unless the cost of urban homes decreases per square foot and the cost of personal transpiration increases dramatically. Why? Because at any point, either TIME or MONEY is more important. At the point where time is more scarce than money, a car becomes your preferred method of transport. At the point where you have a family and must transport them, and STUFF a car becomes your preferred method of transport. No matter what your income bracket. People do not change their lifestyle, political or class biases, except that they become more conservative as they age. There is no shift going on that is not purely economic and demographic in origins. Agencies who are supposed to promote goods and services can only create loyalty inducing narratives for people if they understand why people make decisions. And bringing your biases to the table only makes it increasingly difficult to create messages and campaigns that resonate with consumers – because consumers increasingly resonate with the truth. Good advertising is the truth spoken succinctly and creatively.

                  • Why Are So Many Equatorial Nations ‘Failed States’?

                    This posting is in response to “Postcards From Hell: Images fom the world’s most failed states” and commentary on The Agitator. Why are so many equatorial nations ‘Failed States’? “All happy families are the same. All unhappy families are different.” Which means that a lot of things go into making a successful state, and there are a number of reasons why successful advanced cultures develop. And if any one of them goes wrong, a state can fail. Although it will most likely be conquered once it has failed. And there is one particular reason why most of the failed states are currently failing: the legacy of colonialism. But let’s look at the reasons why cultures progress differently: 1) disease gradients are higher (safer) in the cold and lower in the warm. 2) physical effort is difficult in hot weather, which hampers the creation of built capital. (Core body temp also affects IQ during exertion) 3) Agrarian cycles in the north encourage cottage industry in winter, farming in spring and fall and war in summer. This creates certain social orders that foster human, built and technical capital accumulation. Compare to the brutal survival farming of the Chinese and their rice. 4) Rivers and sea: rivers in particular provide safe, easy and low cost product transport. The opposite is true: some areas are simply geographically resistant to trade. Europe is gifted with east-west rivers. 5) Unequal distribution of terrain, water, useful plants and animals favors certain regions in agrarian productivity. Mineral deposits favor certain technologies (europe, coal, wood and iron.) 6) Access to trade means access to knowledge, and greater availability of resources and technology. This increases the probability of innovation, and the development of ‘virtues’ as we understand our commercial and moral code. 7) The abstract thing we refer to as social order, that is embodied in accumulated traditions and habits, are the most important and expensive forms of human capital. These habits facilitate the unspoken normative goals of all social and economic cooperation and coordination. We pay for social institutions by forgoing opportunity: the set of things that we don’t do: the opportunities we do not seize. We pay for infrastructure and governance with the results of trade made possible by those forgone opportunities. These institutions include our different definitions of public and private property, manners, ethics, morals and rituals. Manners, ethics and morals are economic codes just as are written laws, most of which, in all of human history, proscribed punishments for violations of manners, ethics and morals. (A vast oversimplification, but an informative one.) 8) The availability of general technical knowledge (how to craft things) and general systemic knowledge (how the natural world operates). We often confuse education with practical knowledge and scientific knowledge. ( The Muslim world is full of Islamic studies which do nothing except perpetuate ignorance. Some of the sub Saharan world is still in the embrace of magical thinking.) Commercial apprenticeship and on the job learning, not education, (imitation of practice) is the primary means of knowledge transfer. Most knowledge (in the USA as well) is political or secular-theocratic rather than useful knowledge. This is the reason the comparative ignorance of our working classes compared to that of europeans. 9) Concordant technologies. Civilizations need to accumulate a greatdeal of human capital by adopting certain technologies before they can adopt others, else these technologies are not disruptive, and do not increase the division of knowledge and labor. Otherwise tyrants simply use it to institutionalize corruption and profiteering. This isn’t any different from children but on a larger scale. If people do not forgo the opportunity to misuse a technology, they will never be able to gain its productive benefits. You don’t give a child a gun. 10) social orders. The west was built by fraternal orders of city/market joint stockholders, partly because of the high cost of equipment and training. This is the source of our republican sentiments, as well as our tools of argument,reason and science. Other societies have not been so lucky. East asia is largely historically oriented. The northern-west is largely future oriented, the greek, greco (southern) italian and eastern block Mediterranean is largely present oriented, and the near east and Indian continent are magically (‘spiritually’) oriented. Social classes have different time preferences, with the highest classes most future oriented, and the lowest classes most present oriented. 11) Political Institutions: what we call ‘rule of law’ is probably the most important for a market economy – because it permits creative disruption and speculation. But more importantly, it requires the ability to concentrate enough power that the political elite can suppress violence in a geography well enough that people can accumulate capital and trade can develop. If trade can develop productivity can increase, and eventually enough extra production can develop that there is something to redistribute to people, first for the purpose of increasing their productivity, and second for increasing the quality of their lives. We avoid discussing the reality of violence, but without the ability to project violence there is no ‘state’. Because that’s what a state is: a territorial monopoly on violence that forces people to use either the market (good) or to become the victims of exploitative totalitarianism (bad). Now we get to how westerners condemned some cultures: 1) Creating political boundaries and political systems across tribes destroys their ability to create human capital because this uncertainty over-stimulates the need for group persistence and impedes the development of market friendly habits. Thievery and tribal banditry is much easier and cheaper than creating trade and infrastructure. Even today, there is no small sentiment among males that suggests civilization has limited their potential access to mates, and their potential joy, by suppressing their desire for tribal banditry. In certain areas of the globe (in which the USA is fighting) tribal banditry is the primary means of status achievement. And the alternative is the grinding poverty of subsistence farming in an arid landscape. Progress is not always as desirable as it may seem. 2) Colonialism under England was effective in creating stability. In fact the hallmark of the Anglo model is stability. In the entire anglo civilization. In the anglo colonies as well. Stability fosters the accumulation of all forms of capital. If you were colonized by someone else, then you will suffer for it. If you were colonized by the french in particular you will have suffered for it. Anglo social technology is as important as the development of Greek science and reason. That technology, unbenknownst to most of us, is the development of abstract principles that allow calculation and coordination. (Even law is a form of mathematics or calculation. This is a very complex topic for this forum so I’ll leave it at that.). French colonies are a disaster. In fact, the unspoken question is, why were some cultures able to be colonized? It was possible to do terrible things to China via trade, but not to colonize it. And while even the Japanese conquered china, they could not hold or colonize it. 3) Economic interference, and in particular interference by way of charity. This is a hotly debated problem. But individual and local assistance by devoted people seems to make a difference, while insertion of capital is extremely harmful to developing economies that must transform from tribal to market economies. Why we understand that socialism is devastating to economies yet we interfere with primitive and less flexible economies with much less capital, is a mystery of western behavior. Unpleasant realities : 1) Mystical Religion: Unfortunately, there are also ways to manufacture ignorance. Some religions are regressive. In fact it could be reasonably argued that many are simply dangerous. Some have argued that they all are dangerous. The reason one is out gunned out germed and out steeled, so to speak, is a function of a culture’s willingness to adapt disruptive technologies. Luddites perish. Most of the scriptural religions are Luddite systems of thought. 2) The Problem Of IQ: Despite the objections of the inequality-deniers, the one factual reality that the vast body of people will fail to accept in the face of overwhelming objective scientific evidence: that IQ’s are unequally distributed in different races — and in clases within those races. 3) The Problem of Status and Racism: All people are racist in that they prefer acting within and with their race. And this will never change simply because of man’s need to learn, his learning by imitation, and his desire to learn from those he most easily can imitate, and his need to identify WHO to imitate. And the consequential need for visible evidence of status in order to choose who to imitate. Status is a necessary epistemological property of human existence. We cannot exist without it. 4) Mate Selection: The hard reality is that women are hypergamic (marry up). This reality is made more complex because men have a wider IQ variance than women, who are more centered around the mean. This situations presents men with the need to compete for mate selection, while women are increasingly selective about their mates, until they reach a point of either opportunity or resignation. (ie: more women are forced to ‘settle’ than are men.) Furthermore, this status economy requires a diverse range of status symbols within each race and class that inform the eternal search for demonstrable differences in status. Furthermore, this means that within races and within classes, except at the margins, greater status is available WITHIN race than without, and therefore people are incentivized to prefer to act and associate within their races. Racism is as permanent as is classism. The dirty secret of the human genome project is that class is genetically determinant. While economic classes are semi randomly plastic, social classes (which are readily evidenced in the postings on this and other blogs) are decidedly inelastic. (spoken as a member of the upper middle class). Furthermore IQs are different in consequence between groups. A white, Jew or east Asian with a 60 IQ is perceptibly broken. A sub saharan African is not – he or she just has a higher barrier to the learning of abstractions. But otherwise is perceptibly healthy. And IQ distributions affect what can be invented, what can be produced, and what can be maintained in a society. In general, To maintain machines requires an IQ of at least 105. To get a liberal education requires an IQ of 110. To design machines requires an IQ of at least 122 . To design abstractions requires an IQ above 130. To innovate upon a system of thought requires, it appears, an IQ above 140. Everyone else simply uses the tools created by others. It is demonstrably true that the top quintile has more influence on productivity of the society than all the rest combined. And it is the number of people with these IQ’s in the population who are educated enough to employ them, in a society with sufficient capital and division of knowledge and labor to make use of their talents. (For this reason, a capitalist china should rule the world in productivity simply because they have so many people above the mechanical threshold, and so much of the population can participate in complex production.) Since all societies are run by minority elites (even ours) the composition of elites in government, speculative intelligence and innovation in the middle classes, and capable mechanics in the proletariat determine the competitive rates of innovation and change in a society. Despite Racial, national, and class differences in IQ distribution, it does not take a genius to run a market economy. As our pliticians demonstrate daily. What is important is that in any sufficiently large body of people exist sufficient numbers to adopt the rule of law, the institutions of trade, and some form of capital production. The problem is one of numbers: getting the barbarians and potential corrupt bureaucrats to forgo opportunities for personal gain in order to fund the development of their human capital. The problem of coordinating production in a division of knowledge and labor requires a great deal of sacrifice. It is the is a sufficient set of principles govern the progress and adaptability of cultures. As other readers have commented, colonialism is perhaps the greatest determinant today of the relative state of failed nations. I hope this was helpful in providing food for thought.

                  • Who Was Hayek, What Are Austrians, And Why Should I Care? (In 1500 Words)

                    On Old School Economics, someone asks:

                    Can anyone summarize the basic tenets of this school of economics and what are Hayeks contributions? I’ve been looking all over the place and have found some websites that are a bit confusing so if you could make a list, it would be helpful.

                    Hayek is one of a line of Austrian thinkers. The term ‘Austrians’ was originally, like ‘capitalism’, derogatory: meaning essentially ‘those quaint hicks’. Austrianism is a micro-economic (versus macro), rhetorical (versus mathematical), approach to political science and economic theory. This approach suggests that we can analyze the behavior of individuals in economic affairs and from that deduce the best macro policy. It assumes (Like all systems of natural law) that people are not terribly plastic, and that they will ‘always act as humans with self interest’ and that we should enact policies that work in tandem with human behavior rather than trying to change human behavior.

                    [callout] The Austrians used insights gained from calculus (the relative movement of bodies) to create the principle of ‘Marginal Utility’ (wherein each unit of a group of resources changes in value to the owner as they are sold) and the ‘Subjective Theory Of Value’, wherein the value of an object is in what others will pay for it, thus explaining the essentially speculative, and therefore unsettling, nature of capitalism. [/callout]

                    Historically, the Austrian school is a German reaction to the English school’s theory of value. The English (and then marxist) schools, embraced the Labor Theory Of Value, wherein the value of an object has to do with what work went into it. The Austrians used insights gained from calculus (relative movement of bodies) to create the principle of ‘Marginal Utility’ (wherein each unit of a group of resources changes in value to the owner as they are sold) and the ‘Subjective Theory Of Value’, wherein the value of an object is in what others will pay for it, thus explaining the essentially speculative, and therefore unsettling, nature of capitalism. This theory created a much more complex world of things for economists to measure: if all values are subjective, and if each unit of a resource has a different value, then the world consists of an infinite number of unique objects whose value cannot be known until it is sold, and our attempts to measure them in real time are limited to our ability to make wide generalizations and averages about the economy. After these initial insights, Austrians also contributed to theories of money, trade cycles, business cycles, and in particular theories of money and interest. But they all depended upon the basic innovation: relativism (like Einstein’s relative motion of bodies) and therefore subjectivism – again, the application of calculus to human affairs. (The depth of this cognitive insight into the nature of relativism might not be apparent to most people, nor the complexity of created by it. Pi For example is forever inaccurate because it is an approximation of an infinite number of triangles. It’s insolvable using the technology of mathematics as we understand it. Economics to some degree, must make similar averages and assumptions and there is simply no way around it. In fact, the only measure of what we may do, is what we did. There may be no mathematics to explain our economic activities other than the record of our economic activities, because we invent the future, we don’t discover it. ) Austrian theory, which explained the workings of money and information in the market economy, provided the analytical and mathematical methodology with which to argue against the socialist’s attempt to revert from the increasingly complex relativistic market economy to the simplicity of the predictable the village economy. Hayek contributed to this body of economic and political theory in a range of areas. But he is particularly read for his application of the limits of knowledge to political and economic systems. These limits of knowledge are embodied in three essays. They are easy to read. And you can read them a hundred times and learn from them on every reading. 1) “Economics and Knowledge” 2) “The Use of Knowledge in Society” 3) “The Pretense of Knowledge” (To which I would add one more “Coping with Ignorance” and another by Karl Popper: “sources of knowledge and ignorance”. THey were friends and popper’s essay is insightful. ) And after reading those, the one book he referred to as a ‘pamphlet’: “The Road To Serfdom”.

                    [callout]One critic has stated that “all of Hayek can be understood in a few essays”. Which is true. Of course, all philosophers can be reduced to one insight. However, his insight is profound.[/callout]

                    One critic has stated that “all of Hayek can be understood in a few essays”. Which is true. Of course, all philosophers can be reduced to one insight. However, his insight is profound. Along with Ludwig Von Mises, Hayek helped undermined the advance of socialism in what was called the ‘Socialist Calculation Debate”, in which he and Mises argue: first, that as populations increase and specialize in a division of knowledge and labor, the knowledge needed to coordinate production in time is so vast and so rapidly changing that it is impossible for a central authority to obtain and use that information. Second, that prices are the vehicle by which we communicate and coordinate with one another and by destroying prices you destroy that ability to coordinate our activities. Third, that without prices and competition there is no incentive for people to participate in ‘problem solving’ necessary for efficient production, and instead, production will atrophy through entropy. Fourth, that people will simply turn to recreating the price-market in the form of a black market. There are an infinite number of additions to this list, but the central themes are the same: we must increasingly coordinate our actions in increasingly large numbers, producing increasingly complex goods using increasingly fragmentary knowledge. And that without these tools we cannot coordinate our activities. For most of his career Hayek was unhappy that ‘The Road To Serfdom’ was so well respected compared to his more ‘scientific works’ as he put it. But he changed his mind later in life. We should note that Hayek’s ideas are not arguments against redistribution or redistributive public services, so much as arguments against interference in the market economy, and the necessity of using the market economy to provide services. The contemporary reader may not understand that the scope of socialism has changed from one of outright management of the economy to incremental management of the economy. Others have followed Hayek and stated that the behavior of people in a bureaucracy is the problem, not necessarily government itself, when we see government as limited to the use of ‘earnings’ for the provision of public services. Others have theorized that the entire state can be privatized as it was under the large monarchies and can accomplish the same ends. And it appears that this might be true. Hayek’s strengths are also his weaknesses: he was a polite gentleman, and thus his arguments are often ‘softly spoken’. WHen he refutes someone else, he assumes that they are making a simple intellectual error and that he’s helping them correct it. He assumes all men have the best of ambitions. And in doing so does not expose their motivations. In particular he did not refute Keynes, who simply gave socialism a nicer name, and allowed government to change it’s purpose to that of reducing unemployment and increasing redistribution from that of creating competitive capital, and changing society from a system of saving for the purpose of inter-generational lending, to one of consumption and inter-generational dependence. This gentle conservatism perhaps limited the scope of his theory. But for whatever the reason, his theory was too limited. Among all theorists back to Hamilton and Jefferson, Hayek came the closest to solving the problem of political economy in an industrial society: but failed. He gives us warnings about what not to do, and why not to do it, but despite his efforts, he failed to tell us what we should do. Or at least, he failed to sufficiently innovate such that we could implement a society that would preserve our anglo-saxon ‘rights as englishmen’: those rights and obligations as a fraternal order of peers participating in a republican self-government operating a market economy. Which is really what the conservative movement is, and always will be, about.

                    [callout]he failed to sufficiently innovate such that we could implement a society that would preserve our anglo-saxon ‘rights as englishmen’: those rights and obligations as a fraternal order of peers participating in a republican self-government operating a market economy. Which is really what the conservative movement is, and always will be, about. [/callout]

                    He tried to solve the problem of political economy in the industrial age, but he failed, along with Mises, Popper and Parsons. Socialism is not an innovation. It is Luddism: the attempt to make comprehensible a market economy, which exists precisely because it is so complex and incomprehensible that we must use the pricing system and a division of knowledge and labor to administer it. But that does not mean we know how to govern a complex and diverse empire using the traditional republican methodology of opposing powers using debate and consensus over abstractions and an unaccountable legislature relying on intuition and hearsay because the numbers that they have to work with are of such imprecision and speculation that they are meaningless. And when, under fiat paper money, they are not limited by the opinions and willingness of others to comply with their ambitions. Republicanism is a methodology for operating the extended family we refer to as the city-state in a hard-money economy: people with shared economic incentives and shared values.

                    [callout]Republicanism is a methodology for operating the extended family we refer to as the city-state in a hard-money economy: people with shared economic incentives and shared values[/callout]

                    We have not yet solved the problem of Imperial Government under Fiat Money. Hayek thought too small and failed us. The libertarian answer is a Luddite response as well: either reduce government and our states to city states (classical liberals) or fully embrace a market government (Rothbardian-Hoppian Anarchists). And so far, we are left with creeping socialism and no sufficient answer to the problem of preserving our freedom from within competing empires. These articles can be read at http://hayekcenter.org/?page_id=11.