Curt Doolittle

Theme: Institution

  • Fixing A False Criticism: Libertarianism, Anarchy and Somalia

    THE PROBLEM OF DEFINING PROPERTY RIGHTS WHERE THEY DO NOT EXIST IS STILL OPEN. [T]o start with, definitions help us communicate clearly. And they both force us to be honest, and prevent others from making false arguments against us. 1) Liberty is a sentiment. It is a minority sentiment. It is a sentiment held by some percentage of the people that favors the ability to obtain new experiences without external constraint, as long as they harm no others in doing so. (see Haidt) 2) Libertarianism is a political bias. That bias favors various forms of minimal government. It eschews the concentration of power, and the loss of sovereignty. It is a sentiment that is embedded in the western tradition. That western tradition is the egalitarian union of aristocracy. That Aristocratic Egalitarianism is a social adaptation to early Indo-European battle tactics which required independent but coordinated action by self-funded warriors. This social strategy allowed a professionalized minority using advanced weapon technology to conquer or fend off conquerors with much greater numbers. (see Duchesne) 3) Libertarianism it is a philosophical framework authored by Murray Rothbard. This framework argues that all possible rights are reducible to articulated property rights. It contains errors. (Which I have discussed elsewhere). Those errors are significant in that they are morally, and therefore socially and economically regressive. However, the fundamental insight that human actions can be reduced to property rights remains valid, and the errors in Rothbard’s incomplete ethical framework are repairable. Rothbard was unable to solve the problem of institutions, so his framework describes little more than a secular moral religion of opposition to the state. Hoppe solved the problem of cooperative institutions, but did not correct Rothbard’s (or Mises’) initial errors. He did not solve the problem of heterogeneous societies which we live in. So for these two reasons he has described small governments. (I have tried to repair Mises and Rothbard’s errors, and use Hoppe’s insights to create solutions for the problem of heterogeneous and therefore large governments consisting of voluntary institutions which preserve the aristocratic egalitarian ethical system of property rights. But my work is incomplete and not yet available for analysis and criticism.) 4) Anarchy is a) a state of disorder – an inability for humans to organize. Propertarians argue that this means little more than an absence of homogeneous property rights. b) Anarchy is a Utopian idea of an ordered society without any articulated form of order other than human instincts.5) Property is a form of establishing order – the ability of humans to organize. It is a very simple rule that matches, with some significant variation, the human moral instinct, while allowing us to cooperate in a vast division of knowledge and labor, the result of which is lower prices and increased choices. Since a) property can vary from the purely private to the purely common, and since b) the utility of property at any point on that spectrum is different for those with different abilities, and c) since the genetic bias of men and women has shown us a demonstrated preference for different points on that spectrum, which better suit the reproductive strategies of each gender, therefore, the preferred monopoly of property rights varies by class and gender, as well as, perhaps, race whenever a population is heterogeneous. 6) Anarchism is a philosophical research program the purpose of which is to find institutional solutions (organizations, processes and rules) that are an alternative to a monopoly power that we grant to the state, when we create a government in order to institute some set of property rights, and therefore establish order.

    [callout]But in no case do Anarchists or Libertarians suggest there is no ‘governance’. A set of articulated property rights and a judiciary that resolves conflicts over property, is a government. It is just a reactive government. A government or rules. It is the rule of law. [/callout]

    DISCUSSION [S]ince our invention of politics, we cannot seem to limit the republican or democratic state to the functions that preserve our aristocratic egalitarian order: a) the defense of those property rights, and b) the concentration of capital for shared investment at the same time. And by doing so, force people to cooperate in the market, instead of by violence, or the proxy of physical violence we call politics. So, because of that failure of democratic institutions, the anarchic research program seeks to use competition for services to eliminate the corporeal state’s monopoly on power, while maintaining a monopoly on the articulated enumeration of some set of property rights within a geography. The a) libertarian sentiment, b) Libertarian history (the classical liberal model) and c) the libertarian philosophy (all of which are different things) do not answer this problem. The anarchic research program has attempted to. And any attempt by libertarians to state that we have solved this problem is either a failure to understand the state of our intellectual development, or an intentional misrepresentation of it. But in no case do Anarchists or Libertarians suggest there is no ‘governance’. A set of articulated property rights and a judiciary that resolves conflicts over property, is a government. It is just a reactive government. A government or rules. Judges under the common law cannot make law. They can discover it. And they can be overruled by other judges through market competition. But they cannot proactively make law. As such, there is a government under all libertarian models that have been articulated to any degree. The problem remains only in how we first establish a set of property rights. In the west this is not as difficult as elsewhere because those property rights are native to the framework of thought that we inherited with our Aristocratic Egalitarianism. Anyone who is enfranchised (fights) has a right to property which is not abridge-able by his peers. We extended the requirement to fighting, first to those who demonstrated nobility through service of any kind (chivalry). And third to those who demonstrated nobility through exchange and trade. But the principle of property is fundamental regardless of which means one earns his enfranchisement. When anarchists say that they advocate anarchy, it means that they eschew the concentration of power to alter the set of property rights involuntarily, since it breaks with the Aristocratic Egalitarian ethics. Ethics which allow each of us who is enfranchised to experiement and add value to ourselves and society as long as we commit no involuntary transfer from others who are enfranchised. CREATING THAT SYSTEM What anarchists and libertarians of all stripes have failed to do is describe how we create a monopoly definition of property rights without the application of force to do it. In the west, the aristocracy created it out of habitual necessity. And they did it by force. Rome in particular was a powerful machine that mandated a set of property rights and then defended them because it was simply profitable to do so. CRITICS AND ADVOCATES Critics are wrong in the sense that libertarianism will not work in somalia. But they are right in that libertarians and anarchists have not provided a means by which to institute a monopoly of property rights without it first existing. FILLING THE HOLES IN ANARCHISM AND LIBERTARIANISM As I’ve stated above, we are less than a century into our research program at articulating our ancient system of cooperation that we call the libertarian sentiment, but which is more accurately termed the political system called Aristocratic Egalitarianism with its dependency on property rights. While I have filled the hole in our ethics. The hole in our institutional process of implementing a monopoly of individual property rights by other than organized violence is still in need of filling. And we should ask our critics to help us answer that problem, rather than deny we have it.

  • FIXING THE FALSE CRITICISM: LIBERTARIANISM IN SOMALIA. THE PROBLEM OF DEFINING P

    FIXING THE FALSE CRITICISM: LIBERTARIANISM IN SOMALIA.

    THE PROBLEM OF DEFINING PROPERTY RIGHTS WHERE THEY DO NOT EXIST IS STILL OPEN.

    To start with, definitions help us communicate clearly. And they both force us to be honest, and prevent others from making false arguments against us.

    1) Liberty is a sentiment. It is a minority sentiment. It is a sentiment held by some percentage of the people that favors the ability to obtain new experiences without external constraint, as long as they harm no others in doing so. (see Haidt)

    2) Libertarianism is a political bias. That bias favors various forms of minimal government. It eschews the concentration of power, and the loss of sovereignty. It is a sentiment that is embedded in the western tradition. That western tradition is the egalitarian union of aristocracy. That Aristocratic Egalitarianism is a social adaptation to early Indo-European battle tactics which required independent but coordinated action by self-funded warriors. This social strategy allowed a professionalized minority using advanced weapon technology to conquer or fend off conquerors with much greater numbers. (see Duchesne)

    3) Libertarianism it is a philosophical framework authored by Murray Rothbard. This framework argues that all possible rights are reducible to articulated property rights. It contains errors. (Which I have discussed elsewhere). Those errors are significant in that they are morally, and therefore socially and economically regressive. However, the fundamental insight that human actions can be reduced to property rights remains valid, and the errors in Rothbard’s incomplete ethical framework are repairable.

    Rothbard was unable to solve the problem of institutions, so his framework describes little more than a secular moral religion of opposition to the state. Hoppe solved the problem of cooperative institutions, but did not correct Rothbard’s (or Mises’) initial errors. He did not solve the problem of heterogeneous societies which we live in. So for these two reasons he has described small governments. (I have tried to repair Mises and Rothbard’s errors, and use Hoppe’s insights to create solutions for the problem of heterogeneous and therefore large governments consisting of voluntary institutions which preserve the aristocratic egalitarian ethical system of property rights. But my work is incomplete and not yet available for analysis and criticism.)

    4) Anarchy is a) a state of disorder – an inability for humans to organize. Propertarians argue that this means little more than an absence of homogeneous property rights. b) Anarchy is a Utopian idea of an ordered society without any articulated form of order other than human instincts.

    5) Property is a form of establishing order – the ability of humans to organize. It is a very simple rule that matches, with some significant variation, the human moral instinct, while allowing us to cooperate in a vast division of knowledge and labor, the result of which is lower prices and increased choices.

    Since a) property can vary from the purely private to the purely common, and since b) the utility of property at any point on that spectrum is different for those with different abilities, and c) since the genetic bias of men and women has shown us a demonstrated preference for different points on that spectrum, which better suit the reproductive strategies of each gender, therefore, the preferred monopoly of property rights varies by class and gender, as well as, perhaps, race whenever a population is heterogeneous.

    6) Anarchism is a philosophical research program the purpose of which is to find institutional solutions (organizations, processes and rules) that are an alternative to a monopoly power that we grant to the state, when we create a government in order to institute some set of property rights, and therefore establish order.

    DISCUSSION

    Since our invention of it, we cannot seem to limit the republican or democratic state to a) the defense of those property rights, and b) the concentration of capital for shared investment at the same time. And by doing so, force people to cooperate in the market, instead of by violence, or the proxy of physical violence we call politics. So, because of that failure of democratic institutions, the anarchic research program seeks to use competition for services to eliminate the corporeal state’s monopoly on power, while maintaining a monopoly on the articulated enumeration of some set of property rights within a geography.

    The libertarian sentiment, and the libertarian philosophy (which are different things) do not answer this problem. The anarchic research program has attempted to. And any attempt by libertarians to state that we have solved this problem is either a failure to understand the state of our intellectual development, or an intentional misrepresentation of it.

    But in no case do Anarchists or Libertarians suggest there is no ‘governance’. A set of articulated property rights and a judiciary that resolves conflicts over property, is a government. It is just a reactive government. A government or rules. Judges under the common law cannot make law. They can discover it. And they can be overruled by other judges through market competition. But they cannot proactively make law. As such, there is a government under all libertarian models that have been articulated to any degree.

    The problem remains only in how we first establish a set of property rights. In the west this is not as difficult as elsewhere because those property rights are native to the framework of thought that we inherited with our Aristocratic Egalitarianism. Anyone who is enfranchised (fights) has a right to property which is not abridge-able by his peers. We extended the requirement to fighting, first to those who demonstrated nobility through service of any kind (chivalry). And third to those who demonstrated nobility through exchange and trade. But the principle of property is fundamental regardless of which means one earns his enfranchisement.

    When anarchists say that they advocate anarchy, it means that they eschew the concentration of power to alter the set of property rights involuntarily, since it breaks with the Aristocratic Egalitarian ethics. Ethics which allow each of us who is enfranchised to experiement and add value to ourselves and society as long as we commit no involuntary transfer from others who are enfranchised.

    CREATING THAT SYSTEM

    What anarchists and libertarians of all stripes have failed to do is describe how we create a monopoly definition of property rights without the application of force to do it. In the west, the aristocracy created it out of habitual necessity. And they did it by force. Rome in particular was a powerful machine that mandated a set of property rights and then defended them because it was simply profitable to do so.

    CRITICS AND ADVOCATES

    Critics are wrong in the sense that libertarianism will not work in somalia. But they are right in that libertarians and anarchists have not provided a means by which to institute a monopoly of property rights without it first existing.

    FILLING THE HOLES IN ANARCHISM AND LIBERTARIANISM

    As I’ve stated above, we are less than a century into our research program at articulating our ancient system of cooperation that we call the libertarian sentiment, but which is more accurately termed the political system called Aristocratic Egalitarianism with its dependency on property rights.

    While I have filled the hole in our ethics. The hole in our institutional process of implementing a monopoly of individual property rights by other than organized violence is still in need of filling.

    And we should ask our critics to help us answer that problem, rather than deny we have it.

    Source date (UTC): 2013-01-11 08:45:00 UTC

  • The Alternative To Bureaucratic Monopolistic Government : That Makes Communitarians Happy

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    [T]here is only one law, and that is property. If the different forms of property are understood: life, private property, common property, norms as property, and if the forms of theft are understood: risk transfer, indirect involuntary transfer, direct involuntary transfer, theft, fraud and violence, then no other law need exist, and people need be educated to confirm to no other laws. But once the principle of property is violated, so that we allow various forms of theft, we must create a multiplicity of artificial laws the same way that by telling one lie we must tell a dozen to hide it, and a dozen for each of them, and a dozen for each of them. Complexity in life comes from lies in all their forms. Telling the truth makes for a simple life. Complexity in the politics of life comes from abuses of the one law of property. Respecting property in all its forms makes for a simple life, and a simple government. All else that we need can come from contracts and not laws. Contracts exist within the one law of property, in all its forms. Contracts can be fulfilled, they have a definite time period, they require specific performance, and specific When you move to an area, you can sign the contracts that are currently in place, or not move to that area. And the contracts may not violate the one law of property, and judges can resolve conflicts over them easily. The problem judges face is largely to do with the complex network of ‘commands’ and institutionalized thefts masquerading as laws that distort or violate the law of property. The second problem judges face comes from the complexity that arises by justifying the monopoly of the state: the artificial scarcity of judges, the necessity of taking cases rather than taking cases on merit, and the inability to specialize. And the side effect of violating the law of property, is that we MUST degenerate into totalitarianism of commands: the lies and the impact of the lies, the commands masquerading as law, the thefts masquerading as contracts. We must degenerate, because there is no longer a common principle that these laws share. And it is the commonality of principles which determines the habits of the population that must make judgements day in and day out over generations. People who must memorize overlapping complex commands, will soon abandon them. There is only one law, and that is property. The rest is lies masquerading as law. The purpose of which is to empower government with the ability to enslave. [D]oes this mean that redistribution is not warranted, and that we must rely on voluntary investment? Or that the unfortunate must be left to charity? No. It does not. If we have contracts that require performance there must be a return on that performance, otherwise it is not an exchange, but a theft. Markets must have consumers and providers: buyers and sellers just as do shopping malls. just as the mall obtains profits for its shareholders, so do the marketplace’s investors obtain profits for their investment in their market: their geography. To become an investor in that market one need only respect property, and the contracts that are required of the participants in that market. And as an investor, one is due returns on it. Since we all take the same actions to join the market, by adhering to contract, and the one law of property, which are payments in the forgone opportunities for theft, we are equally due returns on our investment in that market. Since we unequally take commercial risks in that market we are unequally due returns from our commercial risks, even if we are equally due returns from our investment in forgone opportunity, which we call respect for the one law of property: which makes the market possible. The commission that investors make on transactions in their market – commissions which can come from sales transactions, or rental fees that come from uses of the commons, can vary, and can be progressive. Otherwise there is an involuntary transfer from the market. However, the contracted terms must not be open to alteration. Because if they are, then there is an opportunity for the majority of shareholders to steal from the minority of shareholders through the act of fraud that we call ‘bait and switch.’ If services are privatized, so that they are not run by a bureaucracy, and contracts cannot be violated by that bureaucracy, and all relations outside of those contracts are voluntary, then we do not create the problem with government: bureaucracy and regulation which manufacture commands and organized thefts masquerading as law. If we do not have ‘elected representatives’ but hire professionals who must respect that law of property, then we do not create the opportunity for government to be a vehicle by which individuals and the artifice of bureaucracy can be purchased by special interests whose entire function is to violate the one law of property and the contracts that have been established. Elected representatives were only necessary because of a lack of ability to communicate preferences in time and space, and the lack of education in the population. If it is not possible to violate the law of property, only to issue new contracts as old one’s expire, and if these contracts are marketed like any other good or service, then they can be purchased by investors who vote their shares. There is no need for the system of theft and corruption we call bureaucratic government. [T]here may indeed be a need for a judiciary. And a record of the common laws which illustrate the means by which knowledge of property evolves over time. And there is certainly the need to hire administrative talent to manage the investment that all members make in their market by their forgone opportunities for fraud theft and violence. But there is no need to allow them to create laws, rather than to administer contracts. There is no need to grant them that special ability to violate the law of property. To create an opportunity for individuals to be purchased by special interests – which we call corruption. There is no need to create a vehicle for our enslavement. Because we are no longer limited in our ability to communicate. So we no longer need to delegate our decision making to anyone. Society is the market. Property is required to make the market. And legislative representative government is the means by which we destroy the institution of property which makes that market possible. It is not a government that protects people. It is the judiciary and the common law, under the one law of property. If all people are possible to sue, and no person is given special protection from it, and the court has the ability to enforce the one law of property, and punishment is limited to restitution, then the institution of property will naturally prevail. We only have problems of abuse within capitalism because the government engages in corporatism: granting thefts we call privileges. SO this is not an appeal to anarchy. It is not an appeal to the absence of government per se. It is government by law: the one law, that no one can violate. Where we do not ask mere human beings to both respect the one law, the rule of law, while at the same time, create an institutionalized means by which their sole purpose is to violate that institutions of property. That we even engage in so foolish a conflict of motives is confirmation of our ability to use the power of myth to deny the obvious. Society is easy to construct with the one rule of property. It is easy to destroy without it.

  • WESTERN CIV: IT’S THE CHURCH. THE CONTENT OF CHRISTIANITY LOOKS IRRELEVANT. The

    WESTERN CIV: IT’S THE CHURCH. THE CONTENT OF CHRISTIANITY LOOKS IRRELEVANT.

    The west is unique for reasons that appear to be entirely the product of aristocracy.

    The church was weak. The tribes were strong. It is the administrative relationship between them that created western culture’s unique attributes: a responsible monarchy.

    The actual content of the bible is pretty much a set of analogies that could be applied to circumstance. But it reflected rather than created the west.

    Aristocracy is more important than Christianity.

    Never imagined that would be the case.

    Source date (UTC): 2012-12-17 13:35:00 UTC

  • ON MICROSOFT’S FUTURE : YES SURFACE LOOKS LIKE A FAILURE (From something I poste

    ON MICROSOFT’S FUTURE : YES SURFACE LOOKS LIKE A FAILURE

    (From something I posted on Dave Quick’s page)

    OK. While I’m thinking about it:

    1) everyone knows msft’s problem is a combination of their dependence on OEM’s paired with the threat of suits, especially from governments, if they try to alter this dependence. They must get into the hardware business. but they can’t without buying someone like Asus, Dell or HP.

    2) The first concept of a desktop everywhere was a correct prediction. The second conceptual bet, of owning the living room was a failure. This again, is a hardware ownership problem, and a distribution network problem. The software is trivial.

    3) Abandoning the pc as a gaming platform in favor of attempts at the living room was a failure. Especially in light of the fact that it was the gaming technology that caused advances in processor demand that fueled increasing creative destruction in the field.

    4) Abandoning the application server market to Oracle and IBM is irreversible, and was driven by at least the following factors a) the failure of msft to create sufficiently advanced products for enterprises, b) because of the performance challenges of the architecture and the slow response to the internet c) losing the IQ during the revolution by killing ASP for example rather than improving windows architecture to tolerate transactions rather than processes (and failing to make PHP part of visual studio) and perhaps creating a compiler for it that would give windows an advantage in productivity d) as I have argued for years, because they underfunded their services organization, which did poor work using poor technology and threatened their cash cow of operating system revenue with top customers, and e) letting the sharepoint group kill off both Commerce Server and nCompass, which together, if funded, could have performed as well as the others f) not-in-redmond that ruined the potential for the Navision acquisition to expand beyond accounting.

    4) The vast majority of microsoft employees have meaningless jobs with little to no impact where they are totally isolated from the pricing system and supported only by the network affect. Survival is as much political as anything else. The hardware business is much less tolerant of this extremely politicized environment. And the losses from hardware failures more substantial. These employees cannot transfer to that environment. ( I won’t go into the other cultural problems there.)

    5) Any management that saw technology as joy has been forced out of the company along with most of the evangelists that actually connected the bureaucracy with the consumers. Much of this management has been forced out largely because there is no technical visionary in the company, and the senior execs are operators, not inventors, so they do not actually know what to do with the business. Furthermore, those that do have been forced out of the company as soon as enough analysts suggest that they would be better at replacing Ballmer. Esp Raikes.

    6) Microsoft’s core technology (Windows) is architecturally unsuited for low cost, high performance computers. It was designed to be heavy, and it remains heavy. It should because underneath it’s conceptually still a product of digital equipment’s minicomputer architecture. If you understand this you will also understand that there is almost nothing that can be done about it without some extraordinary invention that alters the user interface (think talking to your box) the way that touch and hi res altered the interactive experience. It is this kind of innovation that makes substantial investment possible. Because it reduces the transaction cost of working with computers – and all information.

    When I spoke with Stephen Elop about this over lunch a few years ago it seemed as if he simply couldn’t even grasp the idea. Of course, when he went to Nokia I understood the strategy. But I also understood that he was not intellectually capable of improving office nor or altering the course of Nokia. In few meetings I’ve had with Ballmer (I’m out of the industry so I feel safe talking about it) his only concerns were expressed in global terms and the company’s overall revenue potential in the middle term. But every time I think about it, I can’t get away from the famous email to Buffett that stated that in ten years anything could happen to MSFT. And it has.

    Continuing on this thread, Touch eliminates the barrier to use for navigating. It reduces transaction costs. It does not require that the user comprehend abstractions. Gramma would never have had trouble with the ipad the way she had to learn the keyboard.

    But touch does nothing for engineering, finance, science, writing contracts, or even making movies. It does very little for content creators.

    THEREFORE

    Microsoft owns the content creation business. It owns the complex interaction business. It has ceded the application business to the major firms. It has ceeded the consumer to Apple. So microsoft’s market has, like IBM before it, narrowed. It’s narrowed to the need for businesses to have an active directory service to manage security, and the administrative desktop tools (Office) needed for clerical work. IE: Microsoft owns the CLERICAL WORKER. That term includes people who use structured data in its loosest form (verbal arguments and persuasion) to those who use it in it’s common form (financial clerical work) it’s next broadest form (statistical information possible only with Excel or other tools), to it’s creative form (engineering and science). But this is all clerical. The inabilty for msft to control display quality (as does apple) prevents it from being in the visual business.

    No one can or is willing to replace Excel, and the vast network of spreadsheets that most companies (foolishly) run on instead of ERP, PSA and other financial systems which are far more expensive to implement. But if someone creates a version of excel that replaces two dimensional functions with n-dimensional processing like sql, then that would be a significant invention that would make the value of the new product worth the transaction cost of changing it.

    When Word came out, it’s fundamental improvement was the use of the paragraph marker to store formatting data, which allowed rapid redrawing of the screen. Wordperfect for example, used document level tagging, which stayed in effect until altered. This meant that wordperfect had to redraw or rather reprocess the document. It wasn’t just marketing. It wasn’t just that word was carrying the burden of it’s dos roots. It’s that architecturally it was a flawed model in the newer context. Even though the paragraph marker is the source of all the stuff we hate about word.

    Now, If you follow writing it’s split between four camps: text fragments that we use for the majority of our work today (email, text, web pages, forms) , simple word processors (glorified wordpads, which is about all anyone needs), html word processors (formatted text processors), business word processor (word) and writers tool’s (Scrivener and Final Cut models). Fundamentally, the writer’s tool has taken over writing in all professional forms except business writing and contracts. This process will continue.

    WHAT DOES THIS MEAN

    So the point here is that it’s not worth it for anyone to get into microsoft’s office business YET. It is possible for microsoft to DEFEND that CLERICAL business. It is probably NOT possible for microsoft to expand into the CONTENT CONSUMPTION BUSINESS. It has no advantage there. And any attempts to do so (windows 8) will probably be a failure. computers are NOT general purpose devices any more. They’re appliances. THe operating system is not a competitive advantage, It’s a commodity. And in microsoft’s case, the windows architecture is a liability.

    What I have suggested in the past, is that once a competitor has the ability and incentive to eradicate microsoft’s lead it’s actually quite easy to do it with software:

    a) active directory replacement

    b) an inexpensive desktop appliance with superior user interface for the majority of clerical workers, that provides increased protection from theft.

    c) the ability to run a window for legacy windows applications until they are replaced with web based (that this is in process should be obvious) or at least iOS level apps.

    d) a spreadsheet with all Excel functions PLUS a sql like or at least close to sql like langage. esp one that handled graphs (not pictures, data structures).

    This will consume the administrative worker that accounts for the majority of desktop systems.

    My prediction was that Apple would do this as soon as either the iphone/ipad revenue stream threatens to peak, and/or the television strategy that they are starting to roll out fails. It is just too easy for them to use brand preference for apple to displace all clerical systems and support for the simple reason that windows user interface and office features sets are too complex for all but a minority of jobs.

    It might not be apple. It will be someone else (who cares abut this opportunity more than I do….)

    So, for the above reasons both the environment at msft, it’s revenue stream, it’s product architecture, and the few points of advantage taht their technology possesses are all weaker than the network effect is powerful.

    And only someone very visionary can change all that. And that person would have to be CEO.

    Source date (UTC): 2012-12-02 14:27:00 UTC

  • FROM ELSEWHERE: BUILDING A LIBERTARIAN COMPANY (Saved here for future reference

    FROM ELSEWHERE: BUILDING A LIBERTARIAN COMPANY

    (Saved here for future reference on my timeline.)

    As someone who built a sizeable company specifically with the intent of experimenting with libertarian management principles, I can argue that not only does it lead to a high growth company because of transparency and meritocracy, but it’s also a more pleasant place to work because people are empowered – they feel sovereign.

    HOWEVER HERE ARE SOME OBSERVATIONS

    1) CLASS

    libertarianism is a meritocratic, and therefore middle and upper middle class philosophy. If you want to have day laborers, it’s going to be less successful than if you have engineers because the former are less comfortable problem solving than the latter because the former are more open to cheating then the latter (this isn’t necessary that’s just how it works out due to class sorting and peer association).

    While we libertarians feel that liberty is the desire of all, it is not. It is the desire of those of us who have an intellectual advantage. The vast majority of people want only enough liberty to choose who directs them. They do not want to master the information necessary to be fully directed.

    In that sense, liberty is classically defined as consisting of multiple levels:

    1) Freedom of life, property and relationships (liberty)

    2) Freedom to form organizations (association)

    3) Freedom to choose leadership (corporation)

    4) Freedom to ostracize (nationalism)

    5) Freedom to convert or expand (imperialism)

    We libertarians agree with the first three, conservatives and some conservative libertarians with the first four, and neo-conservatives with all five.

    So one cannot easily create a libertarian organization across class lines, unless the majority of control is in the hands of those who wish to preserve that libertarian ordere, and its constant state of variation, meritocracy and competition.

    2) EXPOSE EVERYONE TO PRICES AND PROFIT

    Libertarianism and meritocracy require all people are exposed to the pricing system and its affects. Prices and profit are truths. Opinions are not. Bureaucracy is a synonym for insulation from the pricing system. Engineering this into many companies is extremely difficult. This is because many administrative disciplines are security rather than merit oriented (accounting for example).

    3) ELIMINATE ALL DEDICATED MANAGEMENT

    Middle management provides little if any value in almost all organizations. Knowledge exists at the bottom, and the knowledge to concentrate scarce capital at the top. Design your company to have no pure management. Everyone is responsible for profit. If they are not then you do not need them, and should organize your people differently. Usually it is better to compensate someone very dedicated to produce less profit and split time between leadership/mentoring and productivity/profitability. But if they are not themselves materially productive it is just a countdown before they become valueless. This is counter to human behavior because we all seek to avoid work and subsist upon rents. Management that does not either sell something or produce something is rent seeking.

    4) REORGANIZE YOUR COMPANY FREQUENTLY – EVERY SIX MONTHS

    Try to get your top talent to know more of the business by rotating them through different positions in the company. This will prevent your organization from calcifying in an attempt to be ‘efficient’ at delivering a fixed business model rather than ‘responsive’ and therefore efficient at delivering whatever business model is necessary to satisfy the needs of the market. (Note that it is possible to be a market follower and emphasize efficiency, but libertarianism is an effort to spur innovation. Leave it to liberals to live under the illusion that any commercial model represents a steady state.) Liberty is the source of innovation through competition. But competition creates multiple opportunity for loss.

    5) TALENT

    Marginally competitive companies possess superior talent in key roles. I devote at least a third of my time to recruiting talent.

    7) PROCESSES

    Processes calcify and compensate for stupidity and ignorance. Processes attempt to be efficient in order to minimize the need for interpersonal problem solving. However, this also means that processes are inhibitors to innovation and collaboration. Therefore all processes in your organization may be overridden if a) increase profitability without negative externalities. b) increase customer customer loyalty. (loyalty is meaningful. satisfaction is not. know the difference. satisfaction is only expressed meaningfully as loyalty.) c) increase the chance of opportunity generation without increasing the cost of opportunity generation. You must instill this culture in people so that the understand. Economics is the study, largely, of externalities, since internal exchanges are trivial, and externalities are complicated.

    8) SALES

    My experience is that companies under-invest in sales, and over-invest in fear. The people who generate sales are the most valuable people in your company. There are no exceptions. However, people who can generate sales are contextually dependent. Second, the good ones will only come to places where they are adequately rewarded. So when you are small you cannot generally hire talent that is worth what you pay them. Expect a 60-60% failure rate.

    9) EVERYONE IS A POTENTIAL CUSTOMER

    Every single person you meed is a potential customer. Just like actors and politicians lose their freedom because some paparazzi might catch them at an inopportune moment, an entrepreneur loses the freedom of self expression. (I chose expressly to break this rule because of my intellectual interests, but largely this worked to my advantage as self brand promotion. It turns out that if you will say really controversial things in public and try to defend them, then customers will assume you will give them the same unfiltered advice. It worked for me. In general though, I do not recommend it.)

    10) MANAGEMENT STRATEGY

    As a CEO, you can act as an investor, accountant, operator, salesman or craftsman. Or some combination. Because of personality differences it is unlikely that you will be even moderately successful at more than two. Know your strengths and hire the people who compensate for your weaknesses, but possess your strengths in some minor capacity. (I am a salesman, investor, and craftsman. I hire people who are operators and accountants to actually run the details of the business. Jack Welsh is different, Steve Jobs was different, Bill Gates is different, and Warren Buffett is different. And the guys who turnaround companies that are in trouble are different still. If you are entrepreneurial you are best off being sales and craftsman, because this means you master your industry and its customers. if you are a talented executive in a larger bureaucracy it is better to be operational and financial.

    11) PEER REVIEWS

    Conduct stack ranking peer reviews, with written comments at least once per year and exit the bottom ten percent of the company. (I usually was only able to exit the bottom 4% because the community building within the company was so strong that people would fight hard for underperformers if they thought that they could help them improve. This then creates passionate employees out of both the mentors and those people who were given help in succeeding.

    12) PITCHING AND DESIGNING

    Create some venue where employees suggest new uses for products, or new products, or new services, or pitches for customers. WE were always suprised at how many quiet people from the bottom of the company turned out to be our best idea poeople. It also makes it impossible for others to take credit for someone’s idea.

    13) CREATE PARTIES AND AFTER-PARTIES

    If you can find an excuse to spend a few hundred dollars taking people to a club, restaurant or entertainment venue where they can play, then do it. Every possible time. Have a big event at least once a year that requires formal dress, and is not in competition with some other holiday, just to celebrate each other. Terminate people who do not participate in social events.

    14) HIRE FAMILY AND FRIENDS IF THEY HAVE THE TALENT – NEPOTISM IS THE BEST LOYALTY YOU CAN BUY

    Loyalty is the willingness to absorb losses of opportunity for one’s self in order to create opportunity for the group to whom you are a member. Families do this by nature. Never hire ANY family member who cannot perform, or any friend, and never sacrifice your hiring process. But never discount a friend or family. They will work much harder at group cohesion than outsiders.

    EXPENSIVE?

    If any of this sounds either inefficient or expensive then you should do something other than go into business. People are tribal animals. they calculate all sorts of things with and against one another every day, every hour, every second.

    Make sure that they are calculating something that binds them together to create products and services for your company, in the service of customers, that can be delivered to them at a profit. Because profit is our only way of knowing that we have made use of the world’s resources to serve others, in a manner that they demonstrate by their dear actions rather than their cheap words.

    CLOSING

    I have spent too much time on this post already, but perhaps it will do one person some good. And if so, then I’ve passed it on, and done the moral thing. 🙂

    Cheers

    Source date (UTC): 2012-11-17 05:48:00 UTC

  • As someone who built a sizeable company specifically with the intent of experime

    As someone who built a sizeable company specifically with the intent of experimenting with libertarian management principles, I can argue that not only does it lead to a high growth company because of transparency and meritocracy, but it’s also a more pleasant place to work because people are empowered – they feel sovereign.

    HOWEVER HERE ARE SOME OBSERVATIONS

    1) CLASS

    libertarianism is a meritocratic, and therefore middle and upper middle class philosophy. If you want to have day laborers, it’s going to be less successful than if you have engineers because the former are less comfortable problem solving than the latter because the former are more open to cheating then the latter (this isn’t necessary that’s just how it works out due to class sorting and peer association).

    While we libertarians feel that liberty is the desire of all, it is not. It is the desire of those of us who have an intellectual advantage. The vast majority of people want only enough liberty to choose who directs them. They do not want to master the information necessary to be fully directed.

    In that sense, liberty is classically defined as consisting of multiple levels:

    1) Freedom of life, property and relationships (liberty)

    2) Freedom to form organizations (association)

    3) Freedom to choose leadership (corporation)

    4) Freedom to ostracize (nationalism)

    5) Freedom to convert or expand (imperialism)

    We libertarians agree with the first three, conservatives and some conservative libertarians with the first four, and neo-conservatives with all five.

    So one cannot easily create a libertarian organization across class lines, unless the majority of control is in the hands of those who wish to preserve that libertarian ordere, and its constant state of variation, meritocracy and competition.

    2) EXPOSE EVERYONE TO PRICES AND PROFIT

    Libertarianism and meritocracy require all people are exposed to the pricing system and its affects. Prices and profit are truths. Opinions are not. Bureaucracy is a synonym for insulation from the pricing system. Engineering this into many companies is extremely difficult. This is because many administrative disciplines are security rather than merit oriented (accounting for example).

    3) ELIMINATE ALL DEDICATED MANAGEMENT

    Middle management provides little if any value in almost all organizations. Knowledge exists at the bottom, and the knowledge to concentrate scarce capital at the top. Design your company to have no pure management. Everyone is responsible for profit. If they are not then you do not need them, and should organize your people differently. Usually it is better to compensate someone very dedicated to produce less profit and split time between leadership/mentoring and productivity/profitability. But if they are not themselves materially productive it is just a countdown before they become valueless. This is counter to human behavior because we all seek to avoid work and subsist upon rents. Management that does not either sell something or produce something is rent seeking.

    4) REORGANIZE YOUR COMPANY FREQUENTLY – EVERY SIX MONTHS

    Try to get your top talent to know more of the business by rotating them through different positions in the company. This will prevent your organization from calcifying in an attempt to be ‘efficient’ at delivering a fixed business model rather than ‘responsive’ and therefore efficient at delivering whatever business model is necessary to satisfy the needs of the market. (Note that it is possible to be a market follower and emphasize efficiency, but libertarianism is an effort to spur innovation. Leave it to liberals to live under the illusion that any commercial model represents a steady state.) Liberty is the source of innovation through competition. But competition creates multiple opportunity for loss.

    5) TALENT

    Marginally competitive companies possess superior talent in key roles. I devote at least a third of my time to recruiting talent.

    7) PROCESSES

    Processes calcify and compensate for stupidity and ignorance. Processes attempt to be efficient in order to minimize the need for interpersonal problem solving. However, this also means that processes are inhibitors to innovation and collaboration. Therefore all processes in your organization may be overridden if a) increase profitability without negative externalities. b) increase customer customer loyalty. (loyalty is meaningful. satisfaction is not. know the difference. satisfaction is only expressed meaningfully as loyalty.) c) increase the chance of opportunity generation without increasing the cost of opportunity generation. You must instill this culture in people so that the understand. Economics is the study, largely, of externalities, since internal exchanges are trivial, and externalities are complicated.

    8) SALES

    My experience is that companies under-invest in sales, and over-invest in fear. The people who generate sales are the most valuable people in your company. There are no exceptions. However, people who can generate sales are contextually dependent. Second, the good ones will only come to places where they are adequately rewarded. So when you are small you cannot generally hire talent that is worth what you pay them. Expect a 60-60% failure rate.

    9) EVERYONE IS A POTENTIAL CUSTOMER

    Every single person you meed is a potential customer. Just like actors and politicians lose their freedom because some paparazzi might catch them at an inopportune moment, an entrepreneur loses the freedom of self expression. (I chose expressly to break this rule because of my intellectual interests, but largely this worked to my advantage as self brand promotion. It turns out that if you will say really controversial things in public and try to defend them, then customers will assume you will give them the same unfiltered advice. It worked for me. In general though, I do not recommend it.)

    10) MANAGEMENT STRATEGY

    As a CEO, you can act as an investor, accountant, operator, salesman or craftsman. Or some combination. Because of personality differences it is unlikely that you will be even moderately successful at more than two. Know your strengths and hire the people who compensate for your weaknesses, but possess your strengths in some minor capacity. (I am a salesman, investor, and craftsman. I hire people who are operators and accountants to actually run the details of the business. Jack Welsh is different, Steve Jobs was different, Bill Gates is different, and Warren Buffett is different. And the guys who turnaround companies that are in trouble are different still. If you are entrepreneurial you are best off being sales and craftsman, because this means you master your industry and its customers. if you are a talented executive in a larger bureaucracy it is better to be operational and financial.

    11) PEER REVIEWS

    Conduct stack ranking peer reviews, with written comments at least once per year and exit the bottom ten percent of the company. (I usually was only able to exit the bottom 4% because the community building within the company was so strong that people would fight hard for underperformers if they thought that they could help them improve. This then creates passionate employees out of both the mentors and those people who were given help in succeeding.

    12) PITCHING AND DESIGNING

    Create some venue where employees suggest new uses for products, or new products, or new services, or pitches for customers. WE were always suprised at how many quiet people from the bottom of the company turned out to be our best idea poeople. It also makes it impossible for others to take credit for someone’s idea.

    13) CREATE PARTIES AND AFTER-PARTIES

    If you can find an excuse to spend a few hundred dollars taking people to a club, restaurant or entertainment venue where they can play, then do it. Every possible time. Have a big event at least once a year that requires formal dress, and is not in competition with some other holiday, just to celebrate each other. Terminate people who do not participate in social events.

    14) HIRE FAMILY AND FRIENDS IF THEY HAVE THE TALENT – NEPOTISM IS THE BEST LOYALTY YOU CAN BUY

    Loyalty is the willingness to absorb losses of opportunity for one’s self in order to create opportunity for the group to whom you are a member. Families do this by nature. Never hire ANY family member who cannot perform, or any friend, and never sacrifice your hiring process. But never discount a friend or family. They will work much harder at group cohesion than outsiders.

    EXPENSIVE?

    If any of this sounds either inefficient or expensive then you should do something other than go into business. People are tribal animals. they calculate all sorts of things with and against one another every day, every hour, every second.

    Make sure that they are calculating something that binds them together to create products and services for your company, in the service of customers, that can be delivered to them at a profit. Because profit is our only way of knowing that we have made use of the world’s resources to serve others, in a manner that they demonstrate by their dear actions rather than their cheap words.

    CLOSING

    I have spent too much time on this post already, but perhaps it will do one person some good. And if so, then I’ve passed it on, and done the moral thing. 🙂

    Cheers

    Source date (UTC): 2012-11-17 05:47:00 UTC

  • CULTURAL OBSERVATIONS : OFFICES WITHOUT PHONES First, cell phone plans and costs

    CULTURAL OBSERVATIONS : OFFICES WITHOUT PHONES

    First, cell phone plans and costs are absurdly cheap here. I think in the states I tend to pay well over a hundred a month, and close to two hundred. During heavy business usage plans run six to fifteen hundred a month. (And yes, I have enough knowledge of the different phone companies to know how much of that is wasted on marketing to customers who are not loyal, and how much poorly our regulators protect us from penalty pricing. In penatlty pricing the profits are made by enticing customers with low prices and setting low limits on account usage and charging absurd penalties for going over those limits. This violates the principle of asymmetry of knowledge. And it ends up sending the lower classes to collection and further charges. So yes, I think it’s a hazard, and yes, I think it violates libertarian property rights.

    Second, when you go into an office here, at least the offices that I’ve been into, it’s just not a given that everyone will have a company provided phone, unless they absolutely need one for their work.

    Desks, as we know them. are places where you can store clerical equipment. they are workbenches for people who calculate abstractions rather than modify the physical world.

    But if you have a laptop and a cell phone (or a laptop and skype) you pretty much can work lying down on a couch, or standing at a bar, or in my favorite repose, sitting in a chair with your feet up. Now the truth is, that comfortable seating inversely proportional the the impact on your health. We need to walk. We compensate by standing at standing-desks. Some of us have discovereed the abdominal value of sitting on an exercise ball at a desk, which works your abs eight ours a day. Most of us sit in chairs at desks, which if we use reasonable posture is bad for our hearts and waistlines, but that’s all. Ohters of us recline in couches and chairs, because all we have to do is talk or write text, and a desk is unnecessary, but this is the worst possible place to put your body if you don’t get up and move around every thirty minutes or so.

    All that said, if we don’t need phones, at least some portion of us don’t need desks. But that’s probably bad for our health. So, the next work environment I”m going to put together will have desks at the perimeter, and lots of lounges for working comfortably, and ad-hoc, with the people that you need to.

    Now, I realize that technologists are a narrow segment. And that technologists don’t necessarily signal using office spaces. But for some of us, it’s just paradise to sit in a comfy chair and crank out our ideas.

    Offices need not be structured around phones.

    Source date (UTC): 2012-11-17 03:37:00 UTC

  • REVIEW OF “23 Things They Don’t Tell You About Capitalism (Paperback)” This topi

    REVIEW OF “23 Things They Don’t Tell You About Capitalism (Paperback)”

    This topic deserves better treatment.

    Others have listed some of the glaring faults in the book.

    1) The most obvious one which is a restatement of Marx’s patently false labor theory of value.

    2) The next most obvious is the patently false argument that labor is a constant price independent of local costs.

    3) The next most obvious is the false claim that advocates argue that free markets are frictionless – when they argue instead only that bureaucrats are even worse than the market is at making decisions.

    Realistically, the MORAL complaints he raises about the social and political difficulties created by inequality, may have some merit, but his economic and philosophical arguments are, in a word, adolescent. Any third first year graduate student in economics should be able to refute most of the ‘points’ in this book. And it’s unfortunate that such criticisms of capitalism are made on absurd grounds, rather than those that would actually help lead us to a better understanding of what markets do for us, and how we can best make use of them.

    CRITICISMS OF CAPITALISM

    1) capitalism simply states that the market will do a less bad job than humans who try to control it. Despite our desires to the contrary, history has proven this, logic demands it, and mathematics confirms it.

    2) The market does not provide sufficient protections against ‘cheating’, fraud, theft and violence. This is why we have regulations: to force people to use ONLY fully informed competition in the market as a means of fulfilling their interests and the interests of others. Furthermore, constant innovation in technology, products and services requires constant innovation in regulation against new means of cheating, fraud, theft and violence.

    3) The market does not provide sufficient protections against the concentration of capital that allows large capital holders to circumvent the market by either temporary monopolistic practices, or abuse of the government to obtain regulatory privileges – including collective bargaining privileges.

    4) The market does provide all people with declining prices, but it is arguable that this is an insufficient benefit, and that they are due redistribution of some sort, of the profits from the market that their government and taxes create.

    HOWEVER

    1) Democratic Governments demonstrably make the problem worse through corruption, privilege and abuse because the election process is so expensive and lobbyists and interest groups so effective.

    2) Government employees are unjustly protected from lawsuits by citizens. And our laws do not articulate the limits on legislative action.

    3) Redistribution schemes are not tied to profitability or the economy, and result in fixed costs, rather than proportional rewards – this provides everyone with the wrong incentives.

    4) The commons is insufficiently converted to property and corporations with shares, so that it is too open to political exploitation, since regulation is too imprecise and expensive compared to the ease and permanence of shareholder agreements. The government instead creates either privileged monopolies (radio spectra), or corrupt exploitation of the commons (strip mines).

    For these reasons and dozens more, governments are more often the source of the problem than the cure for it. It’s these failures of the government that must be addressed if we are to take advantage of the extraordinary benefits of the market, while preventing its abuses by both the private and public sectors. The market cannot be corrupt. It is like gravity. Only government can over, or under regulate it. The market is not natural. It was invented as we know it, and evolved like any other technology. And it is the most complicated technology man has invented. And he barely understands it.

    5) If our courts allowed us to more easily sue companies for fraud and ‘cheating’ (profiting from asymmetry of information) or privatization of the commons the way that it did in the english common law, then regulation would not be necessary, and citizens wold be able to regulate company behavior through urgent dynamic legal action rather than slow bureaucratic and privilege seeking legislation. this is the argument conservatives and libertarians make: the that government pretends that it does good, when in fact, the regulatory process is only necessary because the government grants businesses legal protection to commit fraud and cheating. ie: government is the problem, not the solution. All any country needs is sufficiently articulated property rights and free access to courts, and the people will directly regulate businesses themselves — WITHOUT the need for legislation.

    SUMMARY

    I view this book as an EXAMPLE of the abuse of capitalism: personal profiteering by selling popular nonsense containing false claims, for the purpose of taking avantage of the emotional sentiments of those without the knowledge to defend themselves from such folly. In this sense, if the government did it’s job, this book would be prevented by regulation from being published. When, in fact, we tolerate in the market, and in our grant of free speech to one another, such abuses, because the attempt at eliminating these abuses would be more damaging than the abuses themselves. This is true of almost all attempts to regulate the market. We must tolerate some things we do not like (like ridiculous books) so that we may have things that we do not like but need (Darwin’s evolutionary treaties). This is the true conflict of both the market and its regulation: the market is a process of trial and error in constant motion and our attempts at regulation are

    Curt Doolittle – The Propertarian Institute

    Source date (UTC): 2012-11-06 03:04:00 UTC

  • NATIONS FAIL: INSTITUTIONS I want to counter Subramanian’s criticism of Acemoglo

    http://www.the-american-interest.com/article.cfm?piece=1334WHY NATIONS FAIL: INSTITUTIONS

    I want to counter Subramanian’s criticism of Acemoglou and Robinson. In his review, he states that ” …the inability of Acemoglu and Robinson to explain the development trajectories of [India and China] is a fault not of their rich and excellent book but of the sui generis, uncooperative reality of Chinese and Indian history. “

    Their book fails to account for the difference between creating new technical advancements and ‘consuming’ them. India and china are consumers of knowledge capital created elsewhere. Their growth will run out when they have consumed those marginal differences. If they manage to ‘repair’ their cultures and governments (institutions) by using the profits from this consumed knowledge, then they might have a chance at innovating in the future. It is not hard to take risks on known methods of production of known products. But it is much harder to use fragmentary knowledge and relationships dispersed throughout an economy, and to take risks on those subjects than it is on those that are more established.

    I don’t really think Subraminian has much of a criticism here. I disagree with Acemoglu and Robinson’s argument that representative democracy is superior to alternatives. I agree that institutions can establish the norms needed for a high trust society. I also agree that it is difficult to establish those institutions if there is not support for the norms that they would impose in the population.

    Source date (UTC): 2012-11-05 18:46:00 UTC