Saturday, December 31, 2011

When Will the Education Bubble Burst?

Good article on the education bubble. More and more people are getting around to my position.

The question is, when will it burst? And what will be the consequences?

Thursday, December 29, 2011

My Thick Libertarianism

I did not start my life as a libertarian. I was not a libertarian in high school. I was not a libertarian until well into college. I did not become a libertarian by reading Ayn Rand. In fact, when college started, I was at best a centrist with Republican leanings, the latter in no small part due to my Baptist upbringing. I had no real notion of how the economy ran other than my folk economics I was born with, and which was reinforced by our political culture. My moral beliefs were almost entirely formed by my Baptist upbringing and my parents' tolerant natures. If there were any libertarian seeds planted during that time, it was the moral aversion to racism planted by my parents.

I went to college and majored in recombinant gene technology. Through that major, I came to understand the world as complex, self-organizing, and evolving. This was reinforced by books I read in college on chaos theory, self-organization, quantum physics, cosmology, etc. I saw the world as complex, self-organizing, and evolving, and so, when I took an Intro. to Philosophy class, in which I was first introduced to economics -- specifically, free market economics -- by Ronald Nash, I found that this fascinating area matched well the world as I understood it to be.

It is perhaps difficult, in one's path to libertarian thinking, to avoid going through Ayn Rand. Which of course I did. I read "Capitalism: The Unknown Ideal" (which it is), which led me to Atlas Shrugged and The Fountainhead, and on to the rest of her philosophy. At the same time, I read a number of other economists, from Walter Williams to Milton Friedman, but somehow did not come across too many Austrian economists. They remained to be discovered much later, after my world view had become even more complex, even more developed. Through Rand I discovered Nietzsche and Aristotle, with the former becoming a close companion.

All of this led me to abandon biology and pursue creative writing. I wanted to write stories that showed my world view. That led me to a Master's in English, and to the Ph.D. program in the humanities at UT-Dallas. I went through a postmodern-nihilist stage of sorts during my Master's time, but came out ready for a revaluation of values at UT-Dallas. It was there I met Alex Argyros and Frederick Turner, both of whom introduced me to the ideas of J.T. Fraser, the great philosopher of time. Through these three, I developed a far more complex world view -- one that was fully universalist, complex, self-organizing, emergentist, and evolutionary. I learned more and more about human evolution, evolutionary psychology, the way the brain worked and processed information about the world, the way we came to know about and understand the world, the ways in which we were social and individualistic -- and the ways in which we were not collectivist and individualistic.

In the beginning, nothing. But nothing, or perfect symmetry, is unstable. The symmetry thus broke, and the universe came into existence in the big bang. Waves of energy spread the universe, and spread through the universe, resulting in interference patterns that, as the universe cooled, crystallized into particle-waves that were capable of interacting to crystallize further into atoms. These atoms were pushed around by the waves of the universe, causing many to pool. As they pooled, gravity increased, attracting more and more atoms, until fusion occurred -- thus did the first stars self-organize and enlighten the sky. Fusion and, later, supernovae created more complex atoms, which were then able to engage in more complex chemistry, creating more complex molecules, and less volatile objects, like planets, on which life could emerge. Complex organic molecules are self-organizing, particularly in an aqueous environment. Life self-organized out of the early earth conditions -- life indeed is likely to be found throughout the universe, so likely is self-organization to occur. Complexity evolved as simple organisms competed for the available space. Competition is a discovery process, and thus life discovered many ways of doing things, including becoming more complex to create new environments. Self-organization to create more complexity is a natural process of the universe itself. One result was the emergence of intelligent species, including one intelligent enough that, with sufficient population density to make them socially intelligent as well, there emerged the ability to understand the universe itself. Yet, humans evolved in a particular environment, even as we are able to adapt to many environmental conditions. Yet, we are adapted to particular social conditions, which we cannot disregard if we want to live a moral, human life. Further, our brains are complex neural networks, which take in sensory data and convert that data into concepts. We are both born with instincts that allow us to learn certain things -- like language -- very rapidly, and subtract differences in common things to create concepts. We must forget to know, meaning we can never know everything possible in the universe. More, our practical knowledge is local. Humans interact with one another to create emergent, self-organizing social processes (spontaneous orders). These range from the moral order to the artistic orders to the economic order. These orders emerge as we become more moral, including more and more people in our "tribe", which really means, in our moral sphere of common humanity. We are thus social individuals whose interactions allow us to be smarter than we are as individuals, and which allow us to coordinate our actions and cooperate better. Organizations emerge which help us achieve our individual goals in that spontaneous order.

Thus, I am a libertarian because libertarianism comes closest to the way the world works. It is the political system one should hold if one believes in human equality, if one believes all people are in fact people and ought to be treated that way, meaning it is fundamentally the most moral system of them all, since all people, regardless of who they are, must be treated morally, meaning, as fellow human beings. The ethical person does not and does not support theft, rape, or murder, regardless of who the person is, whether they are rich or poor, black or white, of a different ethnicity, of a different culture, speak a different language, or are from a different country. These things are immoral for an individual, a group, or an organization to do -- even if that organization calls itself a government. Thus, I am a libertarian because libertarianism is the most moral world view -- not just political view -- one can hold. There is a recognition that good intentions are not good enough. The actions one takes to reach one's goals matter as much as the goals themselves. Which is in part why I'm an Austrian-school economist (the other reason being that this school of economics also is realistic in its understanding of epistemology, its tendency to reject equilibrium, and its understanding of the economy as a self-organizing process, or spontaneous order -- meaning it is the school of economics that takes more of the world into consideration in its understanding of the economy, and which actually matches the way the world actually works).

It is because I understand the universe to be a self-organizing, complexifiying, emergentist, evolutionary process, with humans and their social systems a part of that process, that I am a libertarian. It is because of my inclusive moral system, which is itself a spontaneous order, that I am a libertarian. It is because of my understanding of human psychology and human evolution, of how the brain works, of the presence of a variety of instincts we cannot do away with, and the way these all interact to create each individual, and how each individual in turn interacts with others to create organizations and spontaneous orders that, in turn, affect our emergent minds, which affect our neurochemistry, -physiology, and -actions that I am a libertarian. It is because of my understanding of human epistemology that I am a libertarian. My libertarian came out of these things; these things were not informed by my libertarianism. I followed the logic of discovering a consistent world. A free market and a free people interacting in spontaneous order societies reflects the self-organizing complexity at every level of reality in the universe. The world is inexorably and inevitably evolving toward libertarianism. It does not matter if there are conservative elements who oppose this movement. The universe will evolve as it will. All the enemies of reality as it truly is can do is delay it -- with all the negative consequences that delay necessarily brings.

Delay means we are trying to keep the world simple, or we are trying to simplify the world more. If you simplify a human, you make him an animal; if you simplify a living thing, you make it a pile of molecules undergoing entropy (you kill it). If you kill people, you simplify society. If you protect companies from competition, you stand in the way of new ways of doing things, and thus prevent more complexity from emerging. You thus stand in the way of the natural tendency of the universe. To do so is as immoral as actively simplifying the world. Thus, those who would destroy wealth by attempting to redistribute it (wealth can be created or destroyed, but cannot be redistributed -- only riches can be redistributed), those who would stand in the way of social complexity by opposing immigration in all forms, those who would stand in the way of economic complexity with their socialist or interventionist schemes (anti-natural religious schemes, if the truth be told), those who would prevent cultural and artistic evolution, are all from this point of view immoral people, standing in the way of the complexifying drive of the universe.

Tuesday, December 27, 2011

Praxis, Common Praxis, and Praxeology

Praxis is action; common praxis is the action common to a group who must act as they do to cooperate and coordinate their actions. Mathematics has a common praxis. So, too, does physics, chemistry, and biology. The arts and humanities almost do not have a common praxis -- though the overlaps are themselves interesting. Between the simple sciences and the arts & humanities is the complex sciences, the social -- or humane -- sciences. This of course includes psychology, economics, and sociology. There are some aspects in which the social sciences have common praxis, with considerable divergence. This is perhaps not surprising, given the complexity of what is being studied. Complexity implies more perspectives are possible. The arts and humanities, of course, are highly perspectivist in nature. The more values come into play, the less likely one is to share a common praxis, too. Math and physics do not bring many values into play other than the values of truth and accuracy. But what values come into play when making an economic analysis? Or in analyzing a poem?

Where does this leave praxeology? One can certainly study human action, and determine what would be the best action to accomplish a particular goal. One can even recommend a common praxis if one is to work with others to accomplish a common goal. To achieve coordination of plans, there has to be a common praxis. With a common praxis, you can get people to cooperate and coordinate -- this is true in a business or in collaborations, be they online or in the real world. Which implies that the internet will be good for engaging in business and in engaging in the simple sciences -- but will be less helpful in making advances in areas where there is less of a shared praxis.

One possibility is that the internet will actually help those who do share a common praxis in more complex endeavors to get together -- not just online, but in the real world. Want to be a Marxist and live in a Marxist country? By all means, get all of those who share that common world view, find a place to move to, and move everyone there. Want to live in a Keynesian economy? Get all your fellow Keynesians, move someplace, and get to work setting it up. This, I think, is the future. When we get over the idea that there must be a state, once we accept that there can be a variety of governments, and once we get it into our heads that the free movement of people is a good, not a bad, thing, then we will be in a situation where we can peacefully divide up like this, set up areas of common praxis, and have true societal competition. Then we will see which society is, truly, the best. Through competition, we will discover which common praxes are best.

Tuesday, December 20, 2011

RIP, Vaclav Havel

It is a shame that the death of a contemptible dictator, Kim Jong Il of North Korea, has overshadowed the death of one of the few great political figures of history, Vaclav Havel. A great poet and a great statesman, Havel oversaw the peaceful transition of Czechoslovakia from communism to capitalism, and the peaceful breakup (following the will of the people!) of Czechoslovakia into the Czech Republic and Slovakia. Following the lead of Havel, the Czech Republic remains one of the few bastions of economic freedom (and sanity!) in Europe. May Havel be remembered forever as one of the few true defenders of freedom -- and one of the few poets of the 20th century to be willing to sacrifice everything for true freedom, standing against most of his fellow European poets against the horrors (and ugliness) of communism.

Friday, December 16, 2011

Krugman Doesn't Understand Inflation

Krugman is off saying silly things again:

"Look, the Austrian/Ron Paul types made some very strong predictions about inflation — and rightly, given their model of how the world works. In their version of reality, it really isn’t possible to triple the monetary base without dire effects on the price level. In my version of reality, of course, that’s not only possible but what the model predicts in a liquidity trap."

Apparently Krugman does not take several things into consideration in his model.

The first thing one should consider is that, in a recession, there is real deflation. That means that monetary inflation is of course going to be partially offset by that deflation. Krugman should know that. And, of course, he does. This is the entire basis of his argument. It may account for the small trickle of money that has actually entered the economy, but certainly not all of it.

Krugman forgets two other facts. The second thing one should consider is that the banks are not releasing the created money into the economy, but are sitting on it. They are waiting for better lending conditions before the lend the money they have. Bernanke is hoping he can get all that money back before that happens. I wouldn't hold my breath. Finally, third, there is the fact that money doesn't go into the economy equally, but rather enters it in one or two places. Like housing -- which is what happened last time, and helped create the housing bubble. Where is the money entering now? Look for one or two sectors where there is inflation -- that's likely to be your entry point. Inflation spreads from there.

So, considering all three things are in play, we shouldn't be surprised we don't see inflation yet. Yet. Of course, Austrian economics helps us understand the second and third points are in play -- points Krugman is apparently ignorant of. Which is why his analysis is way off.

Once the economy does get going -- if it is allowed to get going through all the continued distortions going on, all of which Krugman approves -- we will see that inflation the Austrians and Ron Paul have been predicting. I am sure Krugman will have some other explanation for it when it comes, though.

Why Your Boss Cannot Coerce You in a Free Market

I have often heard opponents of free markets argue that, like government, which is necessarily coercive, that free markets are coercive as well. They point to things like bosses firing employees as being an example of this. But is a boss firing -- or threatening to fire -- an employee truly coercive?

In a free market, "if you do something good for me, I will do something good for you." In government, which, as noted, is necessarily coercive, "unless you do something good for me, I will do something bad to you." This is the very nature of policing and the military. It is the very nature of taxation.

And what of the boss threatening to fire an employee. Well, that is a case of "If you cease to do something good for me, I will cease to do something good for you." This is NOT the same as "unless you do something good for me, I'll do something bad to you." People think they are the same, and thus free markets are coercive, but they are not. Those are completely different kinds of relationships.

Threatening to end a relationship is not the same as using threats to keep you in one.

Thursday, December 15, 2011

Hayek In Mind: Hayek's Philosophical Psychology

The issue of Advances in Austrian Economics I am in, Hayek in Mind: Hayek's Philosophical Psychology, is now published! You can find it here, where you can download each individual chapter. My chapter, which is titled "Getting to the Hayekian Network", is the final chapter of the book. The book itself can be purchased here. Enjoy!

Wednesday, December 14, 2011

Basic Income Guarantee, Negative Income Tax, and Austrian Economics

I was invited to submit a paper for a book on the idea of the Basic Income Guarantee. The editor, Guinevere Liberty Nell, is still working on getting full permission to do the book, but she says things are looking good. In any case, here is the proposal, which has been accepted:

Civil society is made up of a variety of spontaneous orders, including the economic order and the democratic order. Each has its own values and its own ways of communicating information – and different orders can come into conflict with one another. What is good economics may not be good democratically, and vice versa. And this is certainly most clear when dealing with programs that touch on both orders, such as welfare programs. There is a very large amount of literature out there proving that welfare programs are bad, economically. However, welfare programs are still popular democratically. One could just chalk this up to economic ignorance on the part of the populace – or, one could consider the fact that there are values other than those found in and promoted by the market economy, including social values, that people find just as important. When looked at in this manner, a different set of arguments opens up.

Whatever the economic argument are against welfare programs, from the point of view of the democratic order, they are beside the point. If they are beside the point in one sense, because the populace want such programs, it then behooves us to try to figure out what kinds of programs are least economically problematic. It is from this perspective that I will be comparing welfare as currently constituted in the United States, and comparing it to both the idea of a Basic Income Guarantee (BIG) and to Milton Friedman’s proposal for a Negative Income Tax (NIT). There were some experiments with NIT during the 1970’s that resulted in it being abandoned as an idea, but I will be considering some problems that would necessarily have to be taken into consideration in analyzing those results. I will also be comparing how such programs could be set up, the costs of such programs, etc., to try to suggest which one would produce the best social results at the cheapest costs. Along these lines, I want to pay particular attention to the unseen elements as much as the seen, as replacing all of our welfare programs with one program is going to affect the nature and extent of the current system in place. What will happen if we can eliminate a significant portion of those working in the welfare bureaucracy at both the public and private levels? The natural assumption is that all of those people will now be laid off, but the fact of the matter is that they will be freed to pursue other economic avenues, which may in fact contribute to economic growth and the creation of even more wealth, now that they are no longer participating in non-wealth-creating activities. One has to look down the road quite a bit to truly understand why a program may be either desirable or undesirable. This is the approach I will be taking in analyzing all three – current welfare, BIG, and NIT.

I am sure my regular readers will be a bit surprised at the above proposal. My answer to them: there's always room for second-best ideas. In any case, I'll be writing this paper as a good scientist investigating the interface of two spontaneous orders rather than as the polemicist I can sometimes be here on my blog. There is and should be room for both in one's life.

Monday, December 12, 2011

Why Do People Defend Unjust, Inept, and Corrupt Systems?

Here is an interesting article on why people defend unjust, inept, and corrupt systems. It turns out that there are "four situations that foster system justification: system threat, system dependence, system inescapability, and low personal control." One wonders where ideology comes into play in all this.

Those of us who support spontaneous orders need to consider this: "The less control people feel over their own lives, the more they endorse systems and leaders that offer a sense of order." Often people feel like they do not have much control over their lives in a spontaneous order, like free markets, and thus look toward those who promise "a sense of order," such as welfare statists, interventionists, and even socialists. How do we help foster a sense that we have control over our lives in spontaneous orders? The fact is that we do in fact have more control over our lives in spontaneous order systems than in those ordered by others -- it just does not feel that way. And how it feels matters. What can we do to help people feel more at home, more in charge, in spontaneous order network systems?

Businessmen Do Not Necessarily Understand the Economy

Last night in the Republican debate, Mitt Romney argued that, contra Newt Gingrich, he had spent time in the private sector and, therefore, he understood how the economy works. While I will hardly defend the knowledge of economics held by a historian who spent most of his life in government, the fact that Mitt Romney ran a business does not mean that he understands economics. Indeed, the proclamations of people such as Warren Buffet and Bill Gates on economics proves business people do not necessarily understand how the economy works.

How does this make sense, that someone who can successfully run a business can, nevertheless, be generally ignorant of how an economy works?

The knowledge needed to run an organization such as a firm -- or a government -- is not the same as that needed to understand an ateleological scale-free self-organizing network process. For one, organizations are teleological and have hierarchical network structure. They are designed orders. This may allow a business person to run a government agency -- another teleological, hierarchical, designed organization -- but it hardly argues that they are uniquely positioned to understand the economy qua economy. It is likely they know what business people would like to happen, but what business people would like to happen is good for their businesses, but not necessarily for the economy per se. This argues that Mitt Romney would be good for crony capitalism or mercantilism, but not necessarily for the spontaneous order economy.

The problem is that the skills needed to know how to run a good organization are not the same skills needed to understand how an economy works, including what to do (or not to do) to ensure one has a long-term healthy economy. Contrariwise, one who understands the working of an economy is not necessarily in the position to run the government organization -- which includes, of course, knowing what it can and cannot do, what it should and should not do.

This can be solved if one were to get a politician who is able to run an organization and also has the wisdom to understand that he does not understand how the economy works, and hires good economists as advisors to make up for that shortcoming. But note that knowing one is ignorant requires wisdom (is wisdom, according to Socrates), and there are few who are both arrogant enough to run for office and humble enough to admit ignorance. Things are worse yet if you have someone who has been in business, because they are even more certain they understand how the economy works.

Sunday, December 11, 2011

Spontaneous Order Auto Design

The future of design is crowdsourcing -- another word for "spontaneous order" -- as we can see in this story on Local Motors. Of course, of equal note is the brilliant way they have managed to get around all of the laws that make new car companies impossible to start: if you want it, you have to come help build it, so it can be considered a "kit car."

Agglomeration economy theory could easily be used to explain why there are only a few, very large auto makers in the U.S. -- and the world -- but one should also wonder at the costs imposed by regulations, too, which ensure that only the auto makers already in existence can afford to make automobiles. If auto production were truly a self-organizing system, you would expect to see a power law distribution of auto makers -- many small ones, a medium number of medium-sized ones, and a small number of large ones. Of course, if we consider parts makers as part of this -- as one should -- one should expect them to add to the variety. Probably the auto industry, this broadly conceived, comes a bit closer -- but the industry is still unhealthy from a self-organizing process point of view.

One would expect to see auto parts producers supplying small, local auto makers and inventors. The broader distribution of auto makers would drive innovation, and there may even be a viable electric car by now -- or something even better. But because our laws have resulted in the centralization of the auto industry into a few well-protected crony companies, innovation is slow at best.

The good news is that Local Motors exists, and they are using spontaneous order theory to design their automobiles. Competition is a discovery procedure. Our auto companies need more competition so we can discover better ways of making automobiles.

Happy Birthday Melina!

Today is Melina's birthday. My little girl is 5 today!

Wednesday, December 07, 2011

More on Hayek as Macroeconomist

My posting below seems to be pretty popular. I even managed to get a posting over at Cafe Hayek.

Things That Never Happened In The History of Phlogiston

Mikhail Lomonosov is not an important figure in the history of phlogiston.

These days, you constantly see articles that make it seem as if there was a great debate in the 1700s between Robert Boyle and Lomonosov, and that this debate has continued through the generations. Nothing like this happened. Lomonosov essentially made a fool of himself early in the 1750's, and his ideas vanished from the professional discussion.

The above may sound familiar if you have read Krugman's critique of Hayek's place in the history of macroeconomics. As Mario Rizzo observes, this is almost entirely beside the point, since Hayek in many ways outright rejected macroeconomics. As well he should. It's equivalent to phlogiston theory -- and just as unneeded.

Actually, it is Brad DeLong who put it in such a way that his position can actually be critiqued:

Friedrich von Hayek is only a very minor and very unproductive figure in the work of macroeconomics. He--and Schumpeter, von Mises, and the rest of them--spent a lot of time figuring out why it might be that when you learned that you had overinvested and overborrowed, the natural and necessary thing to do was to shutter (rather than repurpose) factories and send your workers home to eat Cheetos and watch "The Real Housewives of Galt's Gulch".
I often find the economic reasoning skills of economists like DeLong astonishingly bad. Let's analyze this statement. First, Hayek et al did not say that the "necessary thing to do was to shutter" factories. But we should not be surprised if we find that we have less money than we thought we did that we also do not have enough money to repurpose our factory. If you find you have less money than you thought, first cut costs. That is likely going to mean cutting wages, or cutting wage earners. Once you get costs back below income, you can begin to repurpose. The fact that this is apparently completely off the radar screen for DeLong says volumes about him as an economist.

The first thing it suggests is that the macroeconomics mythology he believes in blinds him to the world's reality. There are underlying mechanisms to larger economic patterns. If you don't understand those, you can't understand the larger patterns. DeLong and Krugman (though I know Krugman should know better) are like doctors who think that one can completely understand a patient without understanding that there are organs, tissues, and cells one needs to understand first to understand how the person works at these levels. They take the temperature, find a fever, and recommend bleeding and leeches. Or, to switch analogies, they are the Lysenkos of economics, thinking the social is the important thing, and not the underlying individual's behaviors.

Little do they understand, their macroeconomics is doomed for extinction. It is headed for the ashcan of history, where all wrong theories go. The irony, at least for them, is that it will be replaced by improvements on ABCT and Hayek's spontaneous order theory.

Tuesday, December 06, 2011

Clearly Melissa Gorga Was a Stripper

There is nothing that says that Melissa Gorga of The Real Housewives of New Jersey was a stripper than the fact that she's mortally offended at being accused of being a stripper. Otherwise, it's just silly rumors. And who says a bar maid can't be a stripper?

Am I the only one posting this to see if her idiot lawyer will sue me for saying Melissa Gorga used to be a stripper? I mean, I've never met her, been to the strip club she worked at, or anything, so how could I know? I think the fact that one could get sued for saying such things about someone one doesn't know and who one could not know is ridiculous. And suing me for saying Melissa Gorga was a stripper is only going to make me get my 15 minutes of fame.

I mean, seriously, who actually cares if she was or wasn't? How is that going to affect her reputation? All of those Real Housewives shows merely show us that there are rich people who act just as bad as trailer trash. That is all. Many of those women were strippers too. And many of them weren't. Who cares?

Thursday, December 01, 2011

Student Loans Drive College Costs, Driving Student Loans

James Banks raises the question Can the Humanities Be Saved? He recommends some interesting ideas at the end -- one I had not thought of is price differentials among majors (put a little supply and demand at work). But I would like to look at how he starts off his piece, with “formal statement” issued by the Modern Language Association (MLA):

Public attention has been directed recently to the educational debt students accumulate in the course of undergraduate, as well as graduate, study. A major contributing factor has been the increasing portion of educational costs students must bear in the form of loans. To reduce debt burdens in the future, we call on Congress, state legislatures, and institutions of higher education to calibrate educational costs and student aid in ways that will keep student debt within strict limits. We also call on them to hold in check tuition increases, which often far outpace inflation, and to ensure that degree programs allow for timely completion.
I suppose one should not be surprised that the MLA is ignorant of economics and, thus, they don't understand the real problem is with the loans themselves. The loans make university education artificially cheap -- with artificially low interest rates and delay of payments for people who have short time horizons, due to their age. This drives up prices in the same way similar programs drove up housing prices during the housing bubble. Further, almost all of the increase in costs go to bureaucracy -- much of which is needed to deal with the government, including the loans, etc. Does the MLA really believe that the price reductions won't be sent their way first, rather than to the bureaucracies? In other words, those at the MLA need to learn a little cause-and-effect. Sure, I know that goes against their pomo proclivities, but it's time they grew up and rejoined the real world anyway.

Monday, November 28, 2011

Right to Privilege?

The natural historical state of humans is poverty. Thus, poverty is not what needs to be explained, but wealth.

The natural historical medicine available to humans has been local herbs and magic. Modern medicine is a recent technological development, and it is a wonderful development that has given us longer and better lives. But like all technological advancements that improved our lives, it is a privilege to have it. Does it make sense to argue that one has a right to a privilege?

Friday, November 18, 2011

Justice vs. Social Justice

A good piece on Justice versus Social Justice. Hayek argued that social justice is a non-concept. Leonard Read argued that it's the very antithesis of justice. They are probably both right. It is a non-concept because it is incoherent, yet it is used to destroy justice. Why? Because there is no such thing as collective or social justice -- there are only unjust acts committed by an individual against an individual. There is no excusing "I was only doing my duty" or "It was my job." To knowingly enforce an unjust law (which was conceived of by an individual and voted on by individuals and enforced by individuals) is immoral. To obey an unjust law is immoral. To advocate unjust laws under the guise of social justice, too, is immoral.

Thursday, November 17, 2011

A Few Thoughts on Racism

Shawn Darling, a very left-wing Facebook friend, believes I have not spent enough time on this blog discussing racism. I have pointed out to him that I do not do so because race is not something I am particularly concerned with. I am interested in a wide variety of things, and while I consider racism to be evil, racism has nothing to do with many of the things I regularly write about, such as free market economics, so I don't really discuss it that much. But just for Shawn, I will discuss the foundation and evolution of racism.

Humans are biologically xenophobic. Our closest relative, the chimpanzee, goes to war against other troupes, killing all the male members (and even the female ones at times). To the chimpanzee, the out-group chimpanzee is one who can be killed and even eaten.

Humans are similarly programmed. It makes evolutionary sense. Those who were racist killed those not related to them when they saw them, which would include any non-racist people. Since the non-racist people wouldn't kill anyone, while the racist people would kill anyone who was not like them, any non-racist people would have been wiped out. What is left is a fundamentally racist foundation for human behavior.

If this is the case, how did we get to the state we are in, where racism is seen by many as a despicable world view? Well, there are several factors at work. The first is the emergence of trade, which encouraged people to trust others. This probably emerged first between tribes that were related, then expanded to less and less related tribes. The other is not entirely unrelated, which involves the splintering of groups that retained cultural identity. As more and more people had the same cultural identity, it became harder and harder to identify in a concrete way who was not a member of one's tribe. Symbols emerged to facilitate this -- but when expansionist religions emerged, into which people could convert, people were able to become symbolic members of one's tribe. Since there was a shared ideology, racism decreased. What was once racism was converted into more expansive forms of tribalism, such as religious discrimination. (One can see just how much this is true by the absurd accusation of anti-Jew Arab Moslems of being "anti-Semitic" when Arabs are Semites -- what is meant is that the Arab Moslems are anti-Jew, but the religion has been confounded with the race.)

The expansion of the idea of who is in your tribe continued until it reaches its pinnacle in classical liberalism, which considered all people, regardless of race or sex, to be equals. Of course, that attitude took time to spread (as did ideas of expanding tribal membership to those who practice the same religion), but spread it did. Now racist attitudes in places where liberalism has been dominant for a long time are increasingly rare. However, this does not mean that they are gone. In fact, since racism is a kind of collectivism -- where you consider not the individual, but the group -- collectivist thinking has a tendency to lead people down the path to racism. Historically, socialists were anti-Semites, since Jews were associated with the banks and finance. National Socialism, of course, took this attitude to its logical conclusion, making anti-Semitism at least officially unpalatable for the anti-liberal left since the end of WWII.

Of course, none of this addresses specific issues of race. Rather, it deals with the fact that racism is a fact of human psychology and history. Racism is the standard way of thinking of humans, and it takes effort to overcome it as a species. By raising our children among other races, our children learn to see them as "self" rather than "other," and thus is racism overcome. But this does not mean that other "others" may not arise. We distinguish ourselves in a variety of ways, and we do so in ways that are similar to how others do so. Thus, it is possible for collectivists to come along and insist that this or that group is inferior or superior. For Marx the proletariat was superior to the bourgeoisie. We have those who think the poor superior to the rich, the rich superior to the poor; politicians superior to businessmen (or the average person); left superior to the right, right superior to the left, both superior to liberals, liberals superior to both (which would in fact be anti-liberal for a liberal to think); etc. The racism present today may be less obviously racist, since it is not tied to ancient notions of race, but to other groups. But collectivism is collectivism -- such thinking posits "us" vs. "them," with all the consequences thereof.

As for the specific racial problems of the present day in the United States, one can certainly begin with slavery -- as one should. Afterwards, we had the rise of racist laws to prevent racial minorities from competing with the majority. (Anti-competitive laws are of course anti-market.) These laws were designed to keep a variety of groups from competing, be they black, Hispanic, Irish, Chinese, etc. Unions in particular pushed for these laws, to protect white union members from competition. They no longer do this explicitly, but instead push for increased minimum wage laws, which have the same effect, negatively impacting youths and minorities, particularly blacks and Hispanics. Their push for trade and immigration restrictions are similarly motivated. (It is ironic, then, that the unions do not support the GOP more, since the GOP wants immigration restrictions that would benefit the unions.) Anti-immigrant and anti-trade attitudes have their source in humans' residual racist attitudes. Even well-intentioned programs, such as affirmative action, are based on a racist belief that minorities cannot get ahead without the good, wise white man ensuring their path on the race is all downhill. (This is also based on the primitive belief that the world is a zero sum game, that where there are winners, there must be losers.) Welfare falls too into this category -- less so in places like Europe, perhaps, but certainly targeting blacks and Hispanics in this country. The more our government has tried to "help" minorities (outside of eliminating racist laws -- which amounts to the elimination of an evil once perpetuated by the government), the worse off they have typically become. Those who have refused the help and rather chose to participate in what little bit of a free market economy we have left are those whose lives have in fact improved. In fact, this situation is so apparent that those who have chosen the economy over government -- people like the Chinese, Indians, and Japanese -- now face discrimination by our government against them and in favor of those who have turned to that government rather than to the economy. Of course anybody who knows anything about public choice is not in the least surprised by this fact. Of course, "benefit" is a generous term, since the only way the government can ensure a group continues to support them is if they make sure the group thinks they need the government. Keep them poor so they still need to be helped. (This is why I would never vote for anyone who considered the poor to be their constituent -- it is in the best interest of any politician to expand their constituency!)

Notwithstanding the occasional return to fundamentally racist collectivism, the trend has been away from racist attitudes precisely because we have been expanding our ideas about who is in our tribes. This has been driven the most by free markets and free trade, which make people have to interact with each other to such a degree that they learn that the other is in fact a person, just like them. Thus, those who are anti-market oppose this development.

Tuesday, November 15, 2011

Culture, Markets, and Patterns in Psychology, Society, and History

I have written previously on Gravesean psychology, most recently here (at which there are links to more of my musings on the subject). To recap the theory: individuals' psychologies undergo increasing complexity -- when there are enough with that level of psychological complexity, a new kind of society emerges -- those new life conditions allow for the emergence of yet more complex psychologies -- etc. The theory further states that these psychosocial states go from collectivist to individualist to collectivist, etc. Collectivist tribalism to heroic individualism (think Homeric heroes and society) to collectivist authoritativism (think Medieval European society) to individualistic liberalism (pro-market, etc.) to collectivist egalitarianism (Marxism, etc.). There are more psychological levels beyond this, but these do represent the societies we now see. Further, there are mixtures. The transition from Medievalism to liberalism passed through the Renaissance, the guild system, and mercantilism. One could see fascism/crony capitalism/corporatism as the Hegelian synthesis of liberal and egalitarian economics (proving that the dialectical movement is not necessarily progressive), once egalitarianist economics proved untenable (at best).

I am now reading Arthur Pontynen and Rod Miller's Western Culture at the American Crossroads, in which they discuss Philip Rieff's idea from My Life Among the Deathworks

that there are three ontologically distinct modes of culture, each with its own methodology. What he calls FirstWorld cultures are pagan, in which human struggle to reconcile knowledge with fate and the gods. SecondWorld cultures seek via reason and faith to obtain wisdom, the realization of which results in a sacred order. ThirdWorld cultures center on power and self-interest. Rieff associates postmodern cultures with that view. (46)
Rieff thus seems to argue that there are three cultures, which I would argue map onto each of the collectivist social levels. But what, then, do we make of the individualistic social levels?

Let me restate the situation. The collectivist social levels are social orders approaching equilibrium/stasis (note I say "approaching," as true equilibrium is impossible). The individualist social levels are in fact far-from-equilibrium states that emerge in the transition from one equilibrium to another. As Stuart Kauffman points out in The Origins of Order, though, such states are in fact stable. One can see this if one understands life itself as being in such a state. Among the features of the far from equilibrium state is that it is both individuating and creative.

This then brings me to another book I am reading, Keith Roberts' The Origins of Business, Money, and Markets. Roberts' book is about the earliest evidence of economic activity -- which happens to have emerged during the heroic individualist era. More, his story ends right when the Medieval world emerged. Why? The final chapter's title says it all: "The Downfall of Ancient Business." I would argue that it is no coincidence that ancient business ended in a real sense when the Medieval world view became dominant. Stasis is anti-economic. More, the very feature of a market economy is that it is creative. That requires it emerge during creative periods, which I have already identified with far from equilibrium states. The dream of socialism is the dream of stasis, of equilibrium. Nothing new is created, only what has already been invented is produced.

Of course, the more complex a society, the more likely there are to be many people of different levels, and the more likely there are to be subcultures of different social levels. This in fact makes it more difficult to have a pure system -- socialism is impossible for many reasons, among which is the fact that not everyone is at the psychological level necessary for its acceptance. Nor will everyone be, since we have to pass through each level to get to the next. There is no jumping levels. More, the egalitarian level is not the final one, meaning people are going to evolve beyond that, further disrupting the stasis such people desire. Thus society is increasingly in a state of disequilbrium, with areas of equilibrium and far from equilibrium. The complexity is growing more and more.

To return to Pontynen and Miller, their thesis is that the SecondWorld culture is preferable to ThirdWorld culture, so we need to return to it. However, they modify this recommendation by also recommending the Anglosphere's emphasis on society as a spontaneous order -- which really results in a culture somewhat closer to that which emerged in the Liberal era (though they complain about this era, and identify it as the beginning of the problems we now face culturally). I argued that this model describes the eras of stasis -- which in essence seems to argue that times of business are times we move away from culture, while moves back toward culture are times that are anti-business (suggesting Nietzsche was right to criticize the market economy in his consistent support of culture). Of course, this only applies if we are talking about culture as a stable social condition. If that is how we identify a culture as being a culture, then far from equilibrium eras are culturally disruptive and are thus not cultures in this sense. They are periods of transition from one culture to the next. Many have discussed the current state of the arts, observing that nobody is doing anything new. Well, that's the main feature of a stable culture. Not many people were doing much "new" during the Medieval era in Europe, either. The transition -- which is in a far from equilibrium state -- is going to result in many new things, a proliferation of new forms, styles, etc., until a new stasis is achieved. We are now in that stasis, and thus have achieved culture in the sense being discussed.

In integrating the ideas of these writers, I think I have discovered some interesting historical patterns. They are patterns however are more like those found in a spontaneous order, meaning they are complex and not really predictable in a real sense. We can predict kinds of patterns -- the emergence of collectivist and individualist thinking -- but not how they will be realized. Further, we can predict whether there will be pro-market or pro-culture attitudes, and see why. These are mostly preliminary thoughts, but I think I'm onto something.

Thursday, November 10, 2011

We Should All Observe the Sabbath and Keep It Holy

I am reading a wonderfully dense, incredibly complex and difficult book ostensibly on art, but which lays out such a through philosophical world view first that they have yet to get to art per se (by pg. 45, Ch. 3). It is Western Culture at the American Crossroads by Arthur Pontynen and Rod Miller. I will probably write more on this book as I'm reading it (and as soon as I pin down exactly what they are arguing -- they have managed to first make me sure of where they are going, only to then make a statement that makes me no longer sure, a sufficient number of times that I know better than to say what they are saying until I am finished with the book), but I wanted to note something that has particularly struck me for some reason. Consider the following:

culture is the product of leisure and the object of our thoughts.

The Puritan refers to such leisure as the Sabbath, a day not just of rest but of reflection as well. The Sabbath, or leisure, is associated with the rise of culture because it permits us the time to reflect on the world and our place in it. The Puritan thus democratizes participation in the liberal arts, once the privilege of the aristocratic class. Active reflection on the purpose of life makes possible responsible freedom by the exercising of conscious deliberate choice as such it is deemed the finest activity humans can engage in. Such reflection is self-conscious, a realization that we think, we live, we experience death---and perhaps more. Between life and death occur guilt about the past, boredom with the present, and anxiety about the future. Self-conscious reflection has an object: to understand what meaning, what hope and joy, transcends guilt, boredom, anxiety, and even death. That transcendent goal is the ground for the liberal arts, the arts of the Sabbatical mind, and responsible freedom. (26-7)
Several things come to mind. First, their point about the Sabbath democratizing culture -- the arts -- supports my contention that the arts are now a spontaneous order in their own right, since equal access is an essential feature of spontaneous orders. Second, the point about the importance not just of leisure, but of a particular kind of leisure -- one that allows for contemplation -- is very suggestive. How many of us have that kind of leisure? We fill our time with work, "leisure activities," family, friends, noisy protests, social networks, endless chatter. We keep busy, busy, busy, and thus have no time to sit and think. As a culture we no longer have a day of contemplation. Thus, we are moving back toward more elitist culture -- only the elites are in many ways self-selected. It thus becomes aristocratic, but not necessarily in the sense of aristos meaning "the best" (though those with Ph.D.'s in the humanities may think otherwise of themselves). Rather, the ones who rise to the top are the ones best able to parrot what everybody already knows -- thus is true contemplation discouraged, lest one come to different conclusions. Better to fill one's time with endless chatter, avoid contemplation.

Of course, there are different kinds of contemplation. The average person needs time alone to think. No T.V., no radio, nobody talking to him. Someone like me needs time alone to think, with a pen and paper at hand. The scholar should be contemplative in this active sense, writing down the thoughts, thinking those thoughts through, revising thought thoughts, revising revisions. The scientist, the scholar, the artist all need time to contemplate if they are going to do anything other than what has already been done, if they are going to think new thoughts, if they are going to add to the world. And we need to be joined by everyone else. Everyone needs to observe the Sabbath and keep it holy -- in thus contemplating, one will find oneself, improve oneself, and, improving oneself, find the energy and virtue to understand and improve the world.

Thursday, November 03, 2011

Failure Is Not an Option

John sat in the visitation area across from his father, Carl.

"Well, son, was it worth it? They're going to execute you tomorrow. Was it worth it?"

John leaned forward across the table. "I think so," he said. "You know, I was doing what I loved, and if failing at it resulted in this, then so be it. I was doing what I loved."

"That seems an odd thing to say. You were greedy, son, and that's what got you here."

"No, not greedy. Ambitious. I was ambitious. I wanted to be in charge, and I was in charge. I wanted to succeed, and I succeeded . . ."

"Until you didn't."

"Yes, until I didn't." John leaned back and looked at the gray ceiling. "But until then, it was glorious. I was the best, and that's why I made it. I was the best. I have no regrets."

"What about your family? Your wife? Angela and Adam? Your mom and me?" A tear ran down Carl's cheek. "You were selfish. You are selfish. They're going to lose their father."

John leaned across the table and almost whispered his reply. "Dad, I'm not the one who made the law that if you fail, you lose your life. Everyone supports you so long as you succeed. Nobody, not even you, accused me of being greedy or selfish for as long as I was succeeding. You said you were proud of me when they made me coach. As well you should have been. You don't get to take all that back now that I'm in this situation. You knew as well as I did the consequences of failure. We lost. We lost, so here I am. And tomorrow . . ."

"And tomorrow I can't even bury you, because they won't let you be buried."

"I lost the championship. I failed. That's how it goes. You know you can't fail in this country. You succeed, or else. No do-overs. Ever."

"It's not fair."

"I suppose not. But would it have been fair if I had won and been declared a national hero? I surely wouldn't have turned down the trophy, the accolades, the parades, and lord knows what else. Refusing to turn down all that, how can I turn down the consequences?" John sat up straight in his chair. "It is my destiny. It is the consequences. I did not enter this ignorant of the consequences. I can't complain now."

A guard approached. John looked up at him.

"Well, dad, looks like I have to go. Give my love to mom, Barbara, Angela and Adam. I understand why they couldn't come."

John stood. Carl remained seated. The guard grabbed John by the arm and led him out of the visitation area, the first to leave. The room echoed with continued murmuring. Carl watched in silence as he watched John disappear with the guard through the iron door.

Wednesday, November 02, 2011

FSSO 2011

This weekend I presented a paper, "The Theater of Tensions," at the Fund for the Study of Spontaneous Orders. It was a fantastic conference, with a wide variety of ideas and world views -- it was a broad swathe of classical/traditional liberal thinking. The people were great -- it is nice to be able to have discussions with people with whom one disagrees where the level of respect nevertheless remains high. This doesn't mean that there weren't heated arguments, or that there weren't misunderstandings of positions or arguments, but even if someone unfairly misattributed an argument against, say, socialized medicine, as an argument for the current system, such misattributions were quickly and clearly settled, and thus the real argument was able to take place. (This is something we all do: we meet someone who is against X; we know people who are against X and for Y; therefore we assume that new person is for Y, even though it is possible to be against both X and Y.)

Respect. It was observed at the conference that respect is an ur-value, underlying rights. We respect our friends. We respect our family (in healthy families, anyway). We extend respect to strangers -- and in so doing, extend rights to them. We have moved from a species that killed strangers to one that traded with strangers, and thus extended respect to him. Respect was central at the conference, both topically (unstated and, later, stated) and in our disagreements. Sadly, we see less and less of this in civic society -- if you disagree with me, you aren't just wrong, but evil! (and I of course could never be wrong!). One should be able to get into even a heated discussion of ideas, and at the end of the day, shake hands, wish each other well, and be happy to see each other next time around. But of course, this also requires people to be more interested in learning what the truth really is rather than in being seen by everyone as right, whether you are in fact right or not. And that is one of the advantages of such a conference, where everyone there was a scientist first, and an ideologue second (though sometimes a close second). We were there to try to understand spontaneous orders better, and to try to understand whether they are in fact better for humans to live in than other social systems. Such questions are of course going to raise questions and result in heated debate (such as whether or not spontaneous orders were "natural," and if not, why we were "advocating" them). Naturally, our arguments resulted in some convergence, divergence, greater certainty, and greater uncertainty. Which is as it should be. If you don't come back from a conference without all of those things happening, it wasn't very valuable for you.

Wednesday, October 26, 2011

On Choosing Not to Choose

One of the great benefits of slavery is that you don't have to make any choices and you don't have to make any distinctions (without distinctions, you don't have to make choices). All the choices are made for you. It is a great psychological relief.

Freedom, on the other hand, means you have to make distinctions and choices. That is the joy and curse of freedom. It can be psychologically taxing at times.

Sartre once said one of his favorite times was when he was in the German prison camp when he was captured. He said he loved the camaraderie in the camp. It was why, he said, he became a communist. He became a communist because he loved prison life? That is perhaps the most honest reason ever given by anyone. Removed from him was choice, the need to make distinctions. One simply had to exist. To Sartre, this was glorious.

Beware anyone who argues we should not make distinctions.

Beware anyone who wants to take away your choices.

They are arguing for slavery -- and intend to be the slave masters.

Not all slavery is explicit, obvious, clear. There are many, more subtle, versions of it. One can even be free in one area of life, but enslaved in another. And choosing to restrict one's choices voluntarily (such as, say, though entering into a contract with someone) is not the same as slavery, as you always have the choice to get out (if you can't get out, it's not a contract). Thus, there is no such thing as "wage slavery" in a free market economy. It only exists under socialism in it various guises. Like with the socialists' constant accusations of "materialism" on the part of market supporters, the accusations of "wage slavery" is simply projection on their parts. They are the worst things that they claim to fight.

Wednesday, October 19, 2011

Humans' Love For Collaboration Gives Rise to Spontaneous Orders

One of the things that distinguishes humans from other animals, including our closest relatives, the chimpanzees, is that we like to collaborate, while chimpanzees do not -- even though chimpanzees obviously do collaborate when necessary (they are social mammals, after all). The big difference, though, is that humans prefer to collaborate than to work alone (a few of us artists notwithstanding -- but even then, we like to hash out ideas with others, get feedback, etc.). This preference for collaboration makes our social orders far more complex than chimpanzees'. Indeed, without this trait, there would be no such thing as spontaneous social orders, which both make use of our natural tendency to cooperate, and help us to better coordinate our activities, making us increasingly social.

Tuesday, October 18, 2011

Where Fault Lies in the Recession or, Why We Will Never Get Justice

According to Austrian business cycle theory, artificially low interest rates create bad information which causes people to make bad decisions even as they are acting rationally given the information they have. We can see this in the housing bubble, and we can see it in the education bubble, with low-interest student loans driving it. Cheap money creates false signals. Distorted prices cause people to make what turn out to be bad decisions, made worse when the bubble bursts.

Now, if a business were to do this, were to misinform people about what they were getting, this would be considered fraud, and the business would be held responsible, not the victim of the fraud. However, we have people who were defrauded into buying houses and getting educations that have turned out not to have the value they thought they did, who bought houses and educations with cheap money, thinking they would have the value advertised, and who have seen that value disappear -- along with their jobs in many cases -- but who now are told that they "should have been responsible" and not gotten things they couldn't afford. But what if they could afford them at the time? Circumstances change. And, worse, they were able to afford something, at the time, that was said to have more value at the time than it turned out to have, while now they cannot afford this same thing that has decreased in value, but whose costs must still be paid. They have been defrauded -- but who is paying for it?

The Occupy Wall Street crowd think they have the answer: banks and Wall Street. However, these are but the secondary players, the secondary cause. They were acting rationally given their own bad information -- not to mention pressure from the primary players. It does no good to protest the secondary cause -- we have to protest the primary cause, the government and Federal Reserve which actively worked to create artificially low interest rates and have pushed for more higher education and more people in houses. To get what they wanted, the government created false price signals, including cheap money, to get the behaviors they wanted. Thus, they are responsible for this mess. And they should pay, and they should be the ones made to get us out of our bad situations -- again, something the OWS crowd have intuited to some degree, but without much economic understanding behind it.

The problem is of course that the government does not have its own money. It must tax or borrow (and tax in the future) to get the money needed to make things right. And of course everything they have done to date has done nothing more than maintain the status quo and continue to distort prices. Thus, in a financial sense, one cannot hold the government responsible for its idiotic behavior, because all we would be doing would be taking water from one end of the pool to pour it into the other end. Further, there is the problem of moral hazard, as people would begin to think that every so often the government will bail them out when they have made bad decisions (assuming everyone has made the same bad decisions, which only takes place when the government distorts prices). Of course, the banks are in such a moral hazard situation, knowing that the government will bail them out whenever there's a downturn. This makes it such that the banks are less interested in trying to overcome price misinformation, and are often willing partners in it.

Further, the government has screwed us over on being able to get out from under debt. Don't try to get out of either credit card or student loan debt, because it's not going to happen. Bankruptcy won't save you. And the government has made it harder and harder for the average person to declare bankruptcy, all to the benefits of the banks. This is something that has to change.

Those who have made what turned out to be bad decisions because they were lied to because of distorted prices (and, sometimes, directly), deserve justice. But the government, which is supposed to be where justice is meted out, is the culprit. Where, then, does one turn to justice?

Thursday, October 13, 2011

The Inevitable Triumph of Spontaneous Orders

Timothy Ferris argues in The Science of Liberty that it was the emergence of the spontaneous order of science that laid the groundwork for the emergence of economics as a spontaneous order and of liberal democracy. Naturally, he does not quite use these terms, but if you have read Butos and McQuade on science as a spontaneous order, there is no question what Ferris is talking about. Further, the democratic spontaneous order, by valuing spontaneous orders themselves, keeps science a spontaneous order, thus keeping it alive. Dictatorships such as Fascism, National Socialism, and Communism/International Socialism try to turn spontaneous orders into organizations and, thus, destroy them. This includes science. Scientists in the scientific order combined with entrepreneur/inventors in the economic order create more and better technology -- something that is gradually lost in socialist systems such as those listed above. As a result, countries with such systems fall farther and farther behind, and are continually outstripped by spontaneous order societies. The fact that the U.S. and Britain were both spontaneous order societies allowed them to defeat Fascism/Nazism and, later, Communism. To the extent that we are liberal spontaneous order societies, we will continue to grow and succeed; to the extent that we move away from such a system, we face continued degradation.

Tuesday, October 11, 2011

An Open Letter to the Millionaires and Billionaires Expressing Support for the Occupy Wall Street Protesters

Dear Millionaires and Billionaires Expressing Support for the Occupy Wall Street Protesters,

Why don't you hire us and shut up. You have money to invest, so invest it. Arguing for raising taxes on the rich will, as you well know, do nothing more than remove money from your competitors. There is nothing worse and more pathetic than envious rich people trying to get the government to take more money from other rich people just to make them worse off than yourselves. If you are a millionaire or billionaire who supports Occupy Wall Street, I have some debt -- including mortgage debt -- you could pay off for me which would free up a lot of money for me to spend in the economy. Do feel free to contact me, and I will tell you how large a check to write for me. Thank you.


Troy Camplin

Monday, October 10, 2011

Instincts, Game Theory, and Spontaneous Orders

Social scientists would do well to learn more than a bit from animal behavior studies. Take for example Robert Sugden's article Spontaneous Order. He tells about a practice on the Yorkshire coast where there was an unwritten rule about collecting driftwood on the beach. The first to collect the wood and put two stones on them got the wood, so long as they retrieved it within two days, after which time, it belonged to whoever came to get it. Sugden uses game theory to explain how this came about, which is good as far as it goes. He essentially argues that there is a hawk-dove mixed strategy at work, but this strategy is not just a product of spontaneous orders, but has deeper origins than that. As it turns out, it is a general rule of any territorial species to default Hawk when protecting one's own territory, and to default Dove when entering another's territory. This prevents most conflicts. It thus turns out that this pre-human instinctual behavior is what underlies the emergence of these kinds of property rights rules -- including the emergence of property rights themselves. Certainly this does not negate the use of game theory, as evolutionary biologists have made use of it for many decades now -- but it may suggest that our use of it may need to go deeper than we usually go with it. Game theory explains how a set of behaviors emerged, but natural selection explains how a set of behaviors gets set in as instincts, creating a platform for more complex behaviors -- which, if it turns out to have long-term benefits, is likely to become internalized as an instinct, allowing it to emerge more quickly, and any learning associated with it to occur more quickly. Citing John Maynard Smith's work, Segden does approach this insight, without quite getting there. I do believe more work needs to be done on the connection between our instincts and our different spontaneous orders.

Sunday, October 09, 2011

On the Wall Street Protestors -- The 99% Who Don't Understand Economics

Someone needs to tell the Occupy Wall Street protestors that, while it may make some sense to be upset at the banks, etc. that were involved in the actions that led to the economic crash, that these were but secondary players. They ought to be protesting the primary cause, the primary players who created this crisis. That would be Washington, D.C. That would be the federal government and the Federal Reserve.

To believe the protestors, greed magically and suddenly, for no reason anyone can discern, surged all at once, and we ended up in an economic crisis. It is more likely that the amount or level of greed remains the same across time, meaning it cannot explain the crisis. What one has to seek out, then, is why so many people acted exactly the same way at the same time. How is it possible that everyone can be misinformed in exactly the same way, at exactly the same time?

More than that, the protestors also have to explain why and how it is that "greedy corporate fat cats" can benefit from a bad economy. Poor people can't buy as much as wealthy people. Thus, greedy businessmen want more wealthy people, as that means more people buying their stuff, meaning more profit. Only a complete idiot -- or a believer the economy is a zero-sum game -- believes otherwise. The protestors must believe this nonsense, or they would not be out protesting corporations now, three years into the crisis, rather than in 2008. What they do not realize is that it is not the corporations per se that are at fault for the continuing economic crisis, but the government because of the bailouts and stimulus plans and continued distortion of information. The markets try to adjust, and the government keeps feeding people bad information. Thus, it cannot adjust. The protestors ought to be blaming the people who are giving out the bailout money more than the people who accept it (who doesn't want free money? -- other than the banks that did not want to participate, but were threatened and forced to by the Bush administration, which are the same banks, ironically, being protested against now). Of course, these same protestors are asking for their own government handout -- so it's not that surprising they are not protesting their potential benefactors.

In other words, this protest is confused precisely because the protestors do not know what happened, do not want to protest those who caused the problems because they want those same people to give things to them, and because they do not have the least understanding of economics. They are the 99% alright. They are the 99% who don't understand economics (but, because they buy and sell things, think they do).

Thursday, October 06, 2011

Property as a Spontaneous Order

Larry Arnhart has an excellent post on property rights. Of note is his observation that "the property claims of the [California gold] miners moved through three levels--natural possession, customary rules, and formal laws. This manifests the general structure of Darwinian social order as the joint product of natural desires, cultural practices, and deliberate judgments." This is spontaneous order in a nutshell.

It Is Not Virtue to Use Force

It is not virtue to first use force, or even first to threaten force, to try to reach one's goals. To do so is to act just like a child does -- the two year old who cannot say too much, and pushes others thinking that will get his way; the spoiled brat who throws a fit as threat so she can get her way. These tactics are not virtue; these tactics are what children have before they have the social skills and language needed to live a life of virtue. To go to force or threat to get your way is to act like a child at best. There is no virtue in it.

As Aristotle says, for one to act with virtue you must first aim for the beautiful. The beautiful is both variety with unity, the golden mean's creative ratio. To aim thus at the beautiful is thus to aim at a society with great complexity -- that's unified and various, that uses limits proper to make healthy growth. But force or threat of force does not make social bonds -- these only break our social bonds and make us have a simpler society. It's one thing to appreciate the differences among us all as individuals and as subcultures and as cultures, too, but it's another to divide us all with but the purpose of division and destruction. Factions are not virtuous as difference with respect must truly be.

To act with virtue, then, you have to understand the true path to a truly beautiful society -- society where social bonds are made, where growth and creativity is present, where force and threats of force are not the first, or second, third or fourth or fifth on any list of how to deal with anything. Force is how you deal with force, and that is all -- the actions of an undeveloped child must be met on their terms -- but when you have a person who can reason, reason is the way to deal with them, the path of virtue. Are we adults or children? Will we allow ourselves to put mere children, whose first thoughts are force or threats, in charge of us? Will we resort to children's actions first? Or are we all adults, whose choice is virtue and whose aims are always for the beautiful?

Wednesday, October 05, 2011

Variety Necessary for Social Change

One of the most dangerous things that can take place for a species is for it to become a "monoculture," meaning it has very little if any genetic diversity. When this happens, the species is in danger of becoming extinct, from either disease or environmental change. Cheetahs, unfortunately, are a genetic monoculture.

For natural selection to work, there has to be variety from which to select. And there is no telling what may be needed or useful, so it is important (as least as far as the species is concerned) that all sorts of varieties emerge from which selections can be made. The choice is extinction or evolution into something else. Extinction means the complete loss of all the potential of that genetic line.

With the exception of the last line, all of this is equally true at the social level for humans. A healthy society is one with a high level of variety, from which options can be selected. Without options, there are no choices (this seems obvious, but it appears not to be so for many who advocate monopoly-creation, whether through government takeover of government preferences/barriers to entry/etc.). Thus, without options, there is no social evolution. A monoculture may be productive for a time, but it does not take long before it grows stagnant, and even dies. A society needs variety -- a variety of cultures and subcultures, a variety of educational opportunities and styles and outcomes, a variety of scientific theories, a variety of arts and literatures, a variety of entrepreneurs, a variety of people starting firms, a variety (even) of quality. Without variety, we have no options, and no social evolution can take place.

Is it not ironic that many of those who say they are for social change in fact support few ideas/programs/policies that would in fact support and promote in social change, but would in fact give rise to social stagnation worse than even the conservatives want?

Monday, October 03, 2011

Rousseau, Sociopath?

From everything I have read of Rousseau's biography, one has to come to the conclusion, based on the latest work on sociopathology, as summarized by Martha Stout in The Sociopath Next Door, that Rousseau was a sociopath. What other philosophy can a sociopath create other than one that is itself sociopathological? Is it any wonder, then, that the romantic leftism he spawned has always been sociopathological? -- i.e., the French Revolution, the various communist revolutions.

This is hardly an ad hominem attack. I am not saying that one cannot recover from even a sociopath legitimate ideas -- the Montessori method was inspired by Rousseau, after all, even if the disaster that is U.S. education was/is as well. But do we really want to base society, or a view of man, on that of a sociopath?

Saturday, October 01, 2011

Impeach Obama!

No person shall be held to answer for a capital, or otherwise infamous crime, unless on a presentment or indictment of a Grand Jury, except in cases arising in the land or naval forces, or in the Militia, when in actual service in time of War or public danger; nor shall any person be subject for the same offence to be twice put in jeopardy of life or limb; nor shall be compelled in any criminal case to be a witness against himself, nor be deprived of life, liberty, or property, without due process of law; nor shall private property be taken for public use, without just compensation. -- 5th Amendment to the U.S. Constitution

In all criminal prosecutions, the accused shall enjoy the right to a speedy and public trial, by an impartial jury of the State and district wherein the crime shall have been committed, which district shall have been previously ascertained by law, and to be informed of the nature and cause of the accusation; to be confronted with the witnesses against him; to have compulsory process for obtaining witnesses in his favor, and to have the Assistance of Counsel for his defence. -- 6th Amendment to the U.S. Constitution

These two amendments to the Constitution of the United States of America were violated by the President of the United States, Barack Husein Obama, in the assassination of the naturally-born American citizen Anwar al-Awlaki in Yemen. He was not killed in battle, nor even in a war zone. He was targeted for assassination in a foreign country rather than arrested and tried, as is the right of every American citizen, according to two amendments in our Bill of Rights. Anwar al-Awlaki was tried, found guilty, and executed by one man, the President of the United States. This is an impeachable offense, and the President should be impeached, convicted, and imprisoned for this crime against the American people in this direct violation of the Constitution, which he swore to uphold. Anyone who defends this action is in direct and unambiguous opposition to the Constitution of the United States, and is thus not fit for office and should resign immediately.

Everyone who agrees with me, spread this message far and wide. Lovers of liberty, defenders of the Constitution, and anyone who does not want to live in a country where the political leaders are allowed to assassinate their own citizens must stand against this act of tyranny.

Thursday, September 29, 2011

Happy Birthday Mises!

Today is the 130th anniversary of the birth of one of the great defenders of freedom, one of the great theorists of classical liberalism, Ludwig von Mises. He is one of the clearest, most persuasive free market thinkers who has ever written. I don't know how anyone can read Human Action and not come away with both a much clearer understanding of economics and persuaded of liberalism. His methodology is, to my mind, well ahead of its time. Indeed, that has been part of the problem with Austrian economics, that its way of understanding the economy is so far ahead of the rest of economics that it is not really understood at all by mainstream economics. The good news is that, with the introduction of complexity, self-organization, complex adaptive systems, etc. into mainstream economics, the mainstream is in fact moving more and more toward where the Austrian school is already. Which is a nice gift for such a great man.

Wednesday, September 28, 2011

Converging Dates

According to the Jewish calendar, next year is the year 6000.

That of course is the year 2012, which is the same year the Mayan Calendar says the “world will end.” Of course, for the Mayans, the world ending really means a radical transformation of the world into something new.

Nevertheless, let us consider the fact that there is a strand of Christian theology that maps the 7 days of creation onto a thousand year cycle, with Christ being born in 4000 (which would actually push his birth back from the now accepted 4 B.C.). Now, if we look at what God created on Day 5, he created the fish and other sea creatures – is the fish image representing Jesus, then, coincidental? On Day 6, God created the land animals and humans. Have not the last 1000 years been the time of Man? The argument from this strand of Christian theology is that at the end of this 6000 year cycle, Christ shall return and set up His kingdom. The end result is a 1000 year reign of Christ. This of course coincides with what, then, happens on the 7th day, when God rests. What does it mean that God rests? What does it imply for the next 1000 years following 2012?

When Christ came, he fulfilled God’s plan, but what not at all what anyone expected in the Messiah coming. I suspect the same will be true of Christ’s return. It will be in such a way, with such a result, as no one can imagine. I suspect that there will be many people disappointed – the same way they were disappointed the first time around. I intend not to be one of the disappointed.

A change is coming. What it is cannot be predicted. Will it be on the Mayan/Jewish/Christian schedule? Is it a mere coincidence that so many theologies agree on the date?

The Future is Complexity

The economic blogosphere has spend months discussing Tyler Cowen's book The Great Stagnation, in which Cowen argues that we have seen decades of worldwide economic stagnation because we have harvested all the low-hanging technological fruit. I think he is right, precisely because almost all of our technological advances have been in the simplest of sciences: physics. Take all of our technological advances -- the steam engine, the internal combustion engine, the telephone, various sound recording devices, film and now digital image reproduction, refrigerators, electric ovens, dishwashers, microwaves, computers, the internet, printers, air planes, trains, space transportation, etc. -- and one can see that they are all exercises in physics. It seems that most of the theoretical advances in physics have been made, even if we are still in search for a Grand Unified Theory. Serial computing is about as good as it can get, and speeds will soon reach the upper limit of the speed of light (recent discoveries of neutrinos going faster notwithstanding). We seem to have reached the upper part of an S-curve.

At least in the simple sciences. And physics -- and most chemistry -- are simple sciences. I would even argue that the few places in which we have made advances in biotechnology reflect the advances of the simple sciences. Few genes have a 1:1 effect. But we have taken advantage of those.

In the meantime, there have been many advances in complexity, though most of them have been under the radar. Though starting off as a complex science, most economics has been dominated in the 20th century by simple ideas from math and physics, but there has been Austrian economics making complexity arguments for over a century now, with mainstream economics beginning to take complexity seriously and, thus, moving ever closer to Austrian economics. Sociology has been mostly dominated by the reductionist views of Marxist/predictive theory, but culture studies is beginning to move things in the right direction, toward concepts of spontaneous order (see Habermas' work as an example of this). Even the humanities went through reductionist periods before emerging into more complex notions. Certainly biology has been dominated by ideas of complexity from Darwin on. But with the introduction of complexity theory, self-organization, and emergence, we are seeing a new paradigm in biology emerging -- a Newer Synthesis, so to speak.

Indeed, complexity is the new paradigm being established. With it, we will see the emergence in new technologies -- complexity technologies -- we have never seen and perhaps cannot begin to predict. Indeed, unpredictability is central to complexity. We have to become far more comfortable with unpredictability if we are going to have complex technologies. Of course, we are only now becoming comfortable with complexity as a science or as a way of understanding the world itself. One can hope complexity will come to dominate soon -- one can hope that part of what is happening with this recession is a change in paradigm, moving us toward a new way of conceiving the world and of creating new things. Only then will we be ready for a real revolution in biotechnology. More than that, we will be ready to create complex computers that are less precise, but more able to be creative. True A.I. is in the complexity paradigm, not the simple one.

The good news is that there is one technology that is the bridge to this future: the internet. It is built on the simple science of the past, but the outcome was a complex, self-organizing network (in no small part because that is the result of human interactions, and humans are the most important element in the internet). A result is that we are beginning to look at society and technology in different ways. It is time to jettison our old ways of thinking. They served us well for a while, giving us all the technology we enjoy today (but also the reductionist social experiments of socialism, fascism, and communism, with the widespread destruction of individuals and societies that necessarily come from attempting to simplify complex networks) -- but if we are going to move forward, if we are going to have the kinds of advances we had over the last century and a half, if we are in fact going to move well beyond such simple advances and into technologies that will make us wealthier than we could ever imagine, then we will have to move into the complexity paradigm, and soon. Those who do so will be the first great founders, the great scientists and technologists, the great billionaires of their time -- making people like Carnegie and Vanderbilt look like unimaginative paupers.

Tuesday, September 27, 2011

Left, Right, and Liberal

Why do I typically complain about the Left/Progressives and not say much about the Right/Conservatives. Well, first, the fact that the Right is illiberal is sufficiently clear to most everyone, especially those on the Left. What is less clear to many is the illiberality of the Left. Further, "Conservative" isn't an ideology -- it is a stance. Today's Progressive is (when their programs are passed) tomorrow's Conservative. Conservatives in the 1960's opposed Medicare and Medicaid. Conservatives today defend Medicare and Medicaid and seek ways to fix and save the programs. Bush II even expanded Medicare considerably. And his Republican Congress was the one that passed the bill to do so. When Conservatives are actively expanding Progressivist programs, one comes to understand the exact relationship between Conservatives and Progressivism. Classical liberals have consistently opposed Progressives' government programs. They do so not because they "hate the poor" or some such nonsense. No, they are in fact concerned about the poor -- and want their intentions to match the outcomes of their actions. Good intentions are not good enough, as is the case with Progressives. More, classical liberals understand that the knowledge problems that explain why central planning cannot work in the economy, why central planning can never give rise to a creative, dynamic scientific community, and why central planning cannot give rise to a creative, dynamic artistic/literary community also explain why central planning of philanthropy does not work well.

Conservatives are traditionalists who want to conserve whatever exists now (or, perhaps, a decade or two ago). They do not want change, they typically believe that people have to be kept in order by a strong government, do not really trust people to do what is right for them, and believe society has a purpose (to conserve the culture). Progressives want to ignore history, ignore the culture, and rationally construct everything, and do so as an example of how compassionate they are -- no matter what the real world outcomes may be. They want radical change unconnected to what currently exists, that people are controlled by their social environments (which is why it must be overthrown and replaced with a better one), that people cannot be trusted to do what is in their own best interest, and believe society has a purpose/goal (the "just society," as conceived by someone). Classical liberals are traditionalists who favor change -- just not change for the sake of change, nor change unconnected to the current culture, but change that is consistent with the institutions in place, changing as conditions change. We believe in changes on the margin, that people will interacting peacefully if given the chance, that people can be trusted to know their local conditions better than someone who is not there and does not know them, that society does not have a goal or purpose, but that our culture is foundational to everything else in society.

The real issue is whether or not society has a purpose. If it does, humans can and should be harnessed to fulfill that purpose. If it does not, then humans should be left alone to fulfill their own purposes. A social institution with a purpose is known as an organization. If one can freely leave that organization (as one can do with a firm one works for), there is no problem with such organizations being in existence. But if one cannot freely leave (as with a state), then one is enslaved. Oddly, the Progressives who complain about those organizations we can freely leave are typically the same people who think we should submit ourselves to organizations we cannot freely leave.

Monday, September 26, 2011

When You're on the Left, This is What You Really Mean

Do you believe in the "will of the people"?

"Against individualism, the fascist conception is for the State; and it is for the individual in so far as he coincides with the State... It is opposed to Classical Liberalism, which arose as a reaction to absolutism and exhausted its historical function when the State became the expression of the conscience and will of the People. Liberalism denied the State in the name of the individual; Fascism reasserts the rights of the State as expressing the true reality of the individual... In this sense Fascism is totalitarian... The Fascist State, the highest and most powerful form of personality, is a force, but a spiritual force, which takes over all the forms of the moral and intellectual life of man. It cannot therefore confine itself simply to the functions of order and supervision as Liberalism desired."—Benito Mussolini, 1932

Believe the government ought to take care of you?

"We provide for each slave, in old age and infancy, in sickness and in health, not according to his labor, but according to his wants....A southern farm is the beau ideal of Communism."—George Fitzhugh, defending slavery, 1854

I have already written about the fact that Progressivism had eugenics as a cornerstone of its founding.

Western Australia

It’s on the other side of Earth
And, though I hear there is a dearth
Of neighbors, I would fly its girth
And give my country a wide berth.
And though this is in partial mirth,
I’m sure that I would find rebirth –
I think that I would gain in worth –
If I could only move to Perth.

Friday, September 23, 2011

Hayek and YAL at UNT

Had a great time talking about Hayek and spontaneous order theory to the Young Americans for Liberty group at UNT.

Thursday, September 22, 2011

It's (Going to Be) a Boy!

It is official. We are having a boy. Now we just need to come up with a name. Preferably sometime before the middle of February. Until then, he's Cletus the Fetus.

Tuesday, September 20, 2011

Owing Society

We do not owe society anything.

If I borrow something from you, I owe it back to you. The idea that you owe something to "society" means that you borrowed something from that society. But what can that even mean?

The idea that the rich owe society something stems from the belief that economics is a zero sum game. It's not. The wealth creators do not borrow anything, but are creating value. Thus, they contribute to society. It would be like borrowing $10 from me, then insisting that I owe you $5. We do not hear anyone speaking about how novelists owe society anything for the novels they write. Why not? Because it becomes obvious nonsense. The novelist does not take anything out of society that requires any pay back -- but they do produce something that contributes to the society.

The fact of the matter is that one cannot owe society anything. One can owe particular people. So there is also a problem in anthropomorphizing society and treating it as teleological. From this perspective, saying someone owes society is just plain speaking nonsense.

Uncertainty and Spontaneous Orders

When a society moves from epistemological certainty to uncertainty, the outcome is liberty and the emergence of spontaneous order.

When a society moves from epistemological uncertainty to certainty, the outcome is enslavement and the attempt to transform that society into an organization.

Different social orders are affected differently at different times. Theological uncertainty gave us the Reformation and the eventual emergence of a religious spontaneous order (at its most developed stages in the present-day U.S.). Cosmological uncertainty gave us the Scientific Revolution and the eventual emergence of a scientific spontaneous order. Economic uncertainty gave us Capitalism and the eventual emergence of a market spontaneous order. Mythic uncertainty gave us a literary spontaneous order. Political uncertainty gave rise to the emergence of democratic spontaneous orders.

In turn, though, the misuse of science gave rise to certainty in the economy, which gave rise to the idea of central planning and, thus, to socialism and communism. The return of political certainty gave rise to dictatorships like Hitler's and Stalin's. And statements like "The science of anthropomorphic global warming is settled" is a bad sign for science, which can no more survive under that kind of certainty than can free markets under economic certainty or democracy under political certainty.

Postmodern uncertainty leads to nihilism; absolute certainty leads to totalitarianism. In between we have the kind of recognition of one's own ignorance and the possibility of knowledge that leads to spontaneous orders in religion, science, economics, the arts, and even governance. Only to the extent that members of a society accept their necessary ignorance in most things can that society be free.

Monday, September 19, 2011

Moral Governance; Immoral Government

Only if governance takes place in a spontaneous order is it moral. That is because one does not have to participate. One can opt out -- and one can pursue one's own goals. Organizations are designed to help people to pursue their goals. If you do not participate in helping the organization achieve that goal, then you are not needed. You and the organization can and should go your separate ways. If you are forced to participate in an organization, that is immoral. It is slavery to that organization. So long as one participates -- or chooses not to participate -- in spontaneous order governance, that governance is moral. But governments consist of instrumental organizations that people do not have a choice but to participate in. Only if one can opt out of any particular government organization can it be considered moral.

Friday, September 16, 2011

Wednesday, September 14, 2011

Books that Make Us Human

Books that make us human? I'm not so sure about that. I have wonder about his oversupply of utopian and dystopian works (I consider them to both be the same thing).

I would probably include Adam Smith's Wealth of Nations in a longer list -- or if we weren't including fiction. Quite frankly, some of the books made us less humane, not more. Particularly Marx, who was wrong about just about everything. The list may be those that most influenced the course of events in the 20th century, but that's a different list.

What made us most human? Well, I would include Genesis, The Iliad, The Odyssey, The Nicomachean Ethics, The Divine Comedy, Hamlet, Paradise Lost, Faust, The Origin of Species, and Genesis (Frederick Turner, bringing things full circle, title-wise).

Sarah Skwire has a much more thoughtful piece in response over at Modified Rapture.