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.

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.

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.

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.

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.

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.

Spreading the Word(s)

Allen Mendenhall posted some of my poetry from Thyme and Time Again.

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.

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.

New Poll at the Bottom of the Blog

There's a new poll. It's a bit USA-centric, but why should that prevent you from voting? :-)

For All My Poetry (Eventually)

The new home for all my poetry: Thyme and Time Again.

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.

Happy Birthday Daniel!

Today is Daniel Jesus Camplin's 2nd birthday! Today we'll just be hamming it up with the Ham Bone.

This Is What Economic Equilibrium Really Looks Like

Here is what I think is going on in the economy right now:

Employees like to hire people who already have a job. So most of the jobs created are going to people who already have jobs. One can argue that this just frees up that position, but the fact is that either the company will try to fill the absent position with either someone else who already has a job or promote someone from within to fill the position, or feel relieved that they can get rid of someone without having to fire them. Of course, losing someone to another company is costly -- you lose that person's knowledge, which cannot be truly regained even with training. So if a company does hire someone new, they will have to be trained for the position. This is why government stimulus doesn't work. All it does is reshuffle labor -- causing loss of wealth as companies lose people who know what they are doing.

Also, stimulus money allows companies to invest in more efficient technologies than they might otherwise have been able to afford. Of course, if your machines are more efficient, you don't have to hire as many people. So it is very likely that the stimulus money actually caused job losses. Of course, the businesses that got the money are now making high profits as well, for that very reason.

Companies are afraid to invest for several reasons. One is that they have no idea what Obama's health insurance plan is going to cost them. And you never know when the Obama administration will go after a company, prevent a merger (or allow it), etc. Nobody can figure out the rhyme or reason for any of their decisions (mostly because nobody knows exactly who are cronies for the Obama administration -- and note that cronyism isn't unique to the Obama administration, either). This is known as regime uncertainty. Who knows what will happen? Who knows what rules are coming down the pike? Who knows what regulations are coming our way? Best, then, to hunker down and, if anything, pay off debt. Many sensible companies -- and individuals -- are doing just that.

In fact, the fact that many people are preferring to pay down debt rather than spend more money is likely a factor in the economy's sluggish growth.

So investment has slowed, consumption has slowed, and savings too has slowed -- all to pay off debt. In fact, if this family did not have the debt it has, we would be investing, consuming, and saving. We can do none of the above because of both high debt and insufficient income. I have little doubt we are not the only ones in this situation. I have little doubt this is true of businesses and individuals. The only one not acting that way is the government (except the saving part -- they haven't done that for a long, long, long time -- if ever). No, the government is certainly spending -- and their "investments" do nothing more than distort the markets, making recovery take even longer.

I suspect that when people get out of debt, we will see more economic activity in this country. But that has to take place first. It probably wouldn't hurt if companies felt less uncertain about the future as well.