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Source link: http://archive.mises.org/13797/whats-the-right-thing-to-do/

What’s the Right Thing to Do?

September 6, 2010 by

Libertarianism does not claim to encompass the whole of morality. Quite the contrary, it asks only, when is force or the threat of force permissible? The answer to this question delimits a sphere of rights, but not everything that is within one’s rights counts as morally acceptable. FULL ARTICLE by David Gordon

{ 79 comments }

Allen Weingarten September 6, 2010 at 8:28 am

One can clarity matters by differentiating between ‘justice’ namely what ought to be, and ‘morality’ namely how to bring about justice. Traditionally, ‘justice’ is an ideal, that cannot be fully defined, but expresses an outgrowth of our culture, whereas ‘morality’ is best achieved by the free choice of the individual.

It is not helpful to define justice as achieving “what leads to the best consequences” since that presupposes that we know what they are. Moreover, it is the very antithesis of morality to gauge it by tangible consequences, whereas that is best called ‘barbarism’.

michael September 6, 2010 at 8:33 am

If society fails to legislate morality, all morality will be voluntary. Whether one is a serial child killer or a saint working to alleviate suffering, all ethical or moral behavior will be at one’s option.

Here’s what F. von Hayek has to say about it:

“Hayek disapproved strongly of the notion of ‘social justice’. He compared the market to a game in which ‘there is no point in calling the outcome just or unjust’ and argued that ‘social justice is an empty phrase with no determinable content’; likewise ‘the results of the individual’s efforts are necessarily unpredictable, and the question as to whether the resulting distribution of incomes is just has no meaning.’ He regarded any attempt by government to redistribute income or capital as an unacceptable intrusion upon individual freedom: ‘the principle of distributive justice, once introduced, would not be fulfilled until the whole of society was organized in accordance with it. This would produce a kind of society which in all essential respects would be the opposite of a free society.”

In other words, a world where the laws of claw and fang hold sway. A Social Darwinist view of life, unbounded by petty ethical constraints.

But then he thinks slightly better of it, and allows this mite of empathy for those left out of the functioning economy:

“However, Hayek was prepared to tolerate ‘some provision for those threatened by the extremes of indigence or starvation, be it only in the interest of those who require protection against acts of desperation on the part of the needy.’”

http://en.wikipedia.org/wiki/Friedrich_Hayek#Social_and_political_philosophy

So then, when is the threat or the use of force permissible? Whenever the strong prey upon the weak. And if the victim is unable to personally redress the harm done by the thief or rapist, it becomes the job of the cop. And the courts and penal system. That is, a state-ordered solution.

Daniel Coleman September 6, 2010 at 10:08 am

Michael, you write:
“So then, when is the threat or the use of force permissible? Whenever the strong prey upon the weak. And if the victim is unable to personally redress the harm done by the thief or rapist, it becomes the job of the cop. And the courts and penal system. That is, a state-ordered solution.”

I agree with you that when victims require services to redress the harm done by an aggressor (or preventive services to keep the aggression from happening), they will indeed require the services of a policeman, court, and penal system. However, it does not follow at all that we are now speaking of a state-ordered solution. Security and restitution services are just as much subject to the laws of economics as food production and fashion. It follows that a market-ordered solution will be the poor and vulnerable’s best protection against predators.

Allen Weingarten September 6, 2010 at 11:51 am

I submit (along with Ayn Rand) in the non-initiation of force, along with the obligation to use it for self-defense. This is not a matter of whether the aggressor or the victim is strong or weak, but rather of thwarting the initiation of force.

However, I do not view this counter-force as being ‘moral’, but rather as necessary for survival. Allow me to clarify why it is important to differentiate between the positive nature of morality, and the negative nature of survival. Consider a factory that is producing something, where a fire breaks out. It is necessary to stop the fire, and recover from it, but that is not the same as the productive process, and it requires different methods. Similarly, government can restrain aggression, but that is not the same as building culture. No matter how many aggressors you kill, it will not build your moral fiber; no matter how pure your love, it is no substitute for survival.

This formulation justifies government, not on the basis of ‘morality’, but strictly as an imperative for survival. Whereas morality requires love and understanding, counter-force requires effectiveness along with a sense of retribution. It is true that morality and defense work hand-in-hand, but their methods differ. As Objectivists might say ‘metaphysically, they are inextricable, but are epistemologically distinct.’

Daniel Coleman September 6, 2010 at 3:06 pm

“This formulation justifies government, not on the basis of ‘morality’, but strictly as an imperative for survival.”

It seems to me that “this formulation” has taken government for granted. If a fire breaks out in a factory, putting it out is as much subject to the laws of economics as is whatever productive forces were at work before the fire. There are still human actors with certain ends in mind, with a range of means to achieve those ends.

From the standpoint of human action, “survival” and “morality” are not so different that they require fundamentally different solutions — that is, that we can say one requires aggression whereas the other can be left to voluntary forces. Each is a distinct human want — one among many — and by no means is it obvious that government is the best method for attaining the end sought.

Allen Weingarten September 6, 2010 at 5:39 pm

Whether or not you believe in the role of government, there is an operational difference between the means used to defend against aggression, and the moral means to bring justice. By conflating these means one undermines the support for each and every moral guide, viz. thou shalt not kill, thou shalt not lie, etc.

The problem with a fully anarchist world is that by being purely moral, it would preclude its survival (presuming that such a society could be established to begin with which lacked the requisite force).

michael September 7, 2010 at 6:41 am

“Security and restitution services are just as much subject to the laws of economics as food production and fashion. It follows that a market-ordered solution will be the poor and vulnerable’s best protection against predators.”

Ipso facto, eh? So simple.

I only had to think for a moment to find a real-life example of a situation where this principle was actually tested: in pre-Civil War New York. The market for safety reigned, and two police departments arose: the Municipal Police and the Metropolitan Police.

Each proceeded to carve out a turf in which they could shake down the shopkeepers and other local for subscriptions, i.e. protection money. Without paying up, shops would suffer mysterious vandalism, fire and other losses, including physical injury.

At the intersection of their turfs the two police departments would on occasion engage in pitched battles, bloody miniature wars akin to what we would see a century later, between rival mafia factions. But it was a perfect world, unregulated. No one had the power to intervene.

Finally the Metropolitans won out, becoming in time the NYPD of today. Corruption and kickbacks have remained at its core, a legacy of their private origin as a gang of enforcers.

But that was just reality. Theory World is so much more elegant and perfect.

mpolzkill September 7, 2010 at 7:08 am

“Corruption and kickbacks have remained at [the NYPD of today's] core, a legacy of their private origin as a gang of enforcers.”

I could sometimes swear that this tragic logorrhea sufferer is actually an insane libertarian. This one reminds me of another dadaesque missive of his, this one on the mountains of paper the government creates:

“Yes, processing all that paperwork has provided many thousands of valuable jobs. Without such a large federal labor force our many community college and university graduates would have no work; they might well then become Marxist, and rise in revolt. Instead, they’ve become valuable members of the consuming society.”

Inquisitor September 6, 2010 at 11:33 am

“A Social Darwinist view of life, unbounded by petty ethical constraints.”

Liberal troll. :)

Daniel September 6, 2010 at 11:51 am

Is-ought failure, bald assertion, etc.

Joe September 6, 2010 at 3:21 pm

Michael,
The person who wrote the wikipedia outline on Hayek took great liberty with out of context deception. Must be a socialist with an axe to grind. If you read “The Constitution of Liberty” where the quote is from you will find the real meaning of what Hayek was saying.
“What we now know as public assistance or relief, which in various forms is provided in all countries, is merely the old poor law adapted to modern conditions. The necessity of some such arrangement in an industrial society is unquestioned—be it only in the interest of those who require protection against acts of desperation on the part of the needy.” Here is the basis for Hayek’s point: “It has been well said that, while we used to suffer from social evils, we now suffer from the remedies for them. The difference is that, while in former times the social evils were gradually disappearing with the growth of wealth, the remedies we have introduced are beginning to threaten the continuance of that growth of wealth on which all future improvement depends.” Hayek’s Constitution of Liberty was published in 1960. His insight is proving to be so true. As for Hayek’s take on “Social Justice” his book “Law, Legislation and Liberty has a section called, “The Mirage of Social Justice.” Instead of taking excerpts out of context please read the complete text. Here is a quote from Hayek on “Social Justice.”
“Almost always when a government is asked to intervene on behalf of a particular group, this is done in the name of “social justice”. Please when you write these two words, place them in quotation marks, because for me they are lacking in all meaning, they are yet another demagogic phrase. The various authoritarian and dictatorial governments of our day have never stopped proclaiming this “social justice”. Sakharov has provided us with clear testimonly of what is happening in today’s Russia: millions and millions of people are victims of a terror which is seeking to cloak itself under the device of “social justice”. All movements in the direction of socialism, in the direction of centralized planning, involve the loss of personal freedom and end up ultimately in totalitarianism. And yet the call to “social justice” has become the most widely and most effective argument in political discussion. From the outset, these two words have been the rallying point for all the aspirations of socialism. The essential difference between the social order to which classical liberalism aspires and the type of society people want to build in most countries lies in the fact that the first is governed by the principles of correct individual behaviour, whereas the second is committed to satisfying whatever demands “social justice” places on it. Liberalism (classical) demands the right behaviour of the individual. Today, instead many societies attribute to an authority the power to dictate to people what they want to do. The pernicious idea that all public needs have to be satisfied by co-active type organizations, and that all collective needs must be controlled by government, is totally foreign to the basic principles of a free community. The true liberal is a proponent of the proliferation of intermediate voluntary organizations between the individual and the government. I insist that the abolition of poverty is not achieved via “social justice”. Rather it is one of the biggest obstacles to the elimination of poverty. The only way to eliminate poverty is to increase a country’s generalized wealth”. Quoted from an interview given by “El Mercurio” 12 April 1981 in Santiago de Chile.
If you read Hayek you will have a better understanding then just some socialist on wikipedia trying to deceive and distort.

michael September 7, 2010 at 7:02 am

Fair enough. Let’s take a look at what the great master has to say about self-knowledge:

“Hayek himself is emphatic that these insights in the theories of mind and knowledge have the largest consequences for social theory. The inaccessability to reflexive inquiry of the rules that govern conscious thought entails the bankruptcy of the Cartesian rationalist project and implies that the human mind can never fully understand itself, still less can it ever be governed by any process of conscious thought. The considerations adduced earlier, then, establish the autonomy of the mind, without ever endorsing any mentalistic thesis of mind’s independence of the material order. Where Hayek deviates from Descartes’ conception of mind, however, is not primarily in his denying ontological independence to mind, but in his demonstration that complete intellectual self-understanding is an impossibility.”

I’ll stifle the impulse to call this literary style obscurantist gobbledigook, and just skip to his conclusion: Aristotle be damned, you can NEVER know yourself. So give up… just stop trying.

We continue:

“Hayek’s conception of mind is a notion whose implications for social theory are even more radical than are those of Hayek’s Kantianism. It is the chief burden of the latter, let us recall, that no external or transcendental standpoint on human thought is achievable, in terms of which it may be supported or reformed. In social theory, this Kantian perspective implies the impossibility of any Archimedean point from which a synoptic view can be gained of society as a whole and in terms of of which social life may be understood and, it may be, redesigned. As Hayek puts it trenchantly: “Particular aspects of a culture can be critically examined only within the context of that culture. We can never reduce a system of rules or all values as a whole to a purposive construction, but must always stop with our criticism of something that has no better grounds for existence than that it is the accepted basis of the particular tradition.”27 This is a useful statement, since it brings out the Kantian implication for social theory: that all criticism of social life must be immanent criticism, just as in all philosophy inquiry can only be reflexive and never transcendental.”

As we can never know anything about ourselves, we can also form no objective opinion about the nature of society. So morality is just something to be dabbled in, or not, at our option. It’s all relative, idle thoughts of people living in a Darwinist world where the big fish eat the little ones.

This is a monstrous bastardization of philosophy. IMHO, of course. But you’re right, it has certainly been helpful to read the chapter on Hayek’s Philosophy of Mind & His Social Theory: Beyond Kantianism.

“Hayek goes beyond Kantianism, however, in his recognition that, just as in the theory of mind we must break off when we come to the region of unknowable ultimate rules, so in social theory we come to a stop with the basic constitutive traditions of social life. These latter, like Wittgenstein’s forms of life, cannot be the objects of further criticism, since they are at the terminus of criticism and justification: they are simply given to us, and must be accepted by us. But this is not to say that these traditions are unchanging, nor that we cannot understand how it is that they do change.”

There are two sides to the debate. This paragraph comes close to thoughts of God, or “the region of unknowable ultimate rules”. Such rules are simply given to us, and must be accepted by us. As interpreted, of course, by God’s intermediaries in the Church. Man is by this view helpless in the face of God’s unknowable yet Divine Plan.

The other approach, of course, is that in which man defines himself in terms of his response to the place in which he finds himself. Finding himself in a world defined by raw power, where no higher morality restrains the predator and wrongs go unavenged, man defines his own reality as being a moral one. There is no justification behind upholding a morality devised of man’s own choosing, other than that it makes the world a better place than it was. It’s the humanist view.

“In social theory, Hayek’s devastating critique of Cartesian rationalism entails that, whatever else it might be, social order cannot be the product of a directing intelligence. It is not just that too many concrete details of social life would always escape such an intelligence, which could never, therefore, know enough. Nor (though we are nearer the nub of the matter here) is it that society is not a static object of knowledge which could survive unchanged the investigations of such an intelligence. No, the impossibility of total social planning does not rest for Hayek on such Popperian considerations,28 or, at any rate, not primarily on them.

“Such an impossibility of central social planning rests, firstly, on the primordially practical character of most of the knowledge on which social life depends. Such knowledge cannot be concentrated in a single brain, natural or mechanical, not because it is very complicated, but rather because it is embodied in habits and dispositions and governs our conduct via rules which are often inarticulable. But, secondly, the impossibility of total social planning arises from the fact that, since we are all of us governed by rules of which we have no knowledge, even the directing intelligence itself would be subject to such government. It is naive and almost incoherent29 to suppose that a society could lift itself up by its bootstraps and reconstruct itself, in part at least because the idea that any individual mind—or any collectivity of selected minds—could do that, is no less absurd.”

That being said, let us prey.

I know which side I’m on. Thanks for bringing the debate into sharper focus.

mpolzkill September 7, 2010 at 7:11 am

“Let us prey”

Indeed. I guess he *does* work for the government.

Joe September 7, 2010 at 2:07 pm

Michael,
I wasn’t trying to bring the debate into sharper focus. All I was doing was providing a clearer picture of what Hayek was saying about “social justice” or the lack thereof. I’m sure you have been on this web site long enough to know what Hayek believes or doesn’t believe. I guess the best that came out of my response is to go to the source of the quoted person and stay away from Wikipedia. I would be embarassed to use such a source as proof of anything.
So, this debate is not about Hayek, but about “social justice” and whether it has contributed to the betterment of us all. I would say it has not based on history and experience and that the societies (individuals) ability to increase their wealth is the best remedy for poverty. The only social system that can do that is a Capitalist free market system.
Also, I’m fairly new to this blog and I see your comments all the time. They don’t pay you to be a shill do they? If not I’ll just conclude that you like to argue and this blog is a hobby of sorts.

michael September 8, 2010 at 8:54 am

Hi, Joe. It’s debatable whether a free capitalist society or a socialist model could do a better job. We haven’t seen any examples of the one, and those socialist societies that have done the worst have been totalitarian, the antithesis of more promising anarchist-socialist models.

Domination by self-seeking members of the Communist Party, as we saw in the USSR, show little promise for a brighter tomorrow. And I would say the same for economic and political domination here, by exceedingly rich and powerful capitalists. Neither extreme holds much hope for the losers within the two respective systems.

Nonetheless I will note that when Communism dissolved abruptly in the USSR and free wheeling capitalism reigned for a handful of years, the general standard of living went south very abruptly. Most people lost their life’s savings and jobs at one fell swoop. Barter returned as the only viable method of commerce for the penniless, and across the continent people were selling furniture and jewelry for food. It wasn’t a step up.

So it’s a matter for debate all right.

“Also, I’m fairly new to this blog and I see your comments all the time. They don’t pay you to be a shill do they?”

No, I’m sorry to say my statist masters don’t pay me a thing. They would have no motivation to do so. Would that I could sell my product to someone.

“If not I’ll just conclude that you like to argue and this blog is a hobby of sorts.”

Absolutely. My function is to find the holes in arguments. And I find raw materials in great abundance here. While reading people like Mises and Hayek does have its occasional moments of clarity, such is not the case down here in the peanut gallery. Most of the faithful have only the foggiest understanding of their own creed. They do, however, have great zest.

In my way of thinking, though, simple team spirit is no substitute for the use of reason. And I think one makes his greatest contribution to knowledge when he doesn’t decide first what his conclusion should be, and then employ whatever argument he can muster, by fair means or foul, to try to shore it up. To me that’s intellectual dishonesty.

So most often I find my interrogators to be a disappointment. I stick around for the occasional well played game. :)

Joe September 8, 2010 at 12:28 pm

Michael,
So if you were poor what country would you choose to live? Russia, Cuba, North Korea,England, France, Finland, Norway, Mexico or the USA?
What country do you thing you would have the best chance to better your condition? Do the poor in the US stay poor? Why do so many people want to come to this country? I don’t see them risking their lives to enter these other countries.
When you talk about “rich and powerful Capitalists”. I seriously doubt that anyone or business that goes to the federal government to get an advantage in the market is a Capitalist. I don’t consider, for example, GE a capitalistic enterprise. It sucks up big time to the federal government to get an advantage over it’s competitiors. When you have the government entering the market or giving special dispensation to certain people than you no longer can claim them to be capitalists. Hell, there are millions of people who call themselves Christan but they don’t adhere to the teachings of the New Testament.
As for the collaspe of the Soviet Union the standard of living went down because it was basically a welfare state. The citizens depended on the state for their livihood. Of course it would cause when the safety net was taken away. But don’t even think that the country was by magic turned into a capitalistic country. Most of what happened was the crooks came out of the woodwork. They were already there but they saw a vacumn in power.
The government still had its fingers in the mix. They threw the owner of the largest oil company in jail. I believe he is still there. They confiscated the company and now Putin and company run it.
Anyway, I don’t mind a debate and you do keep the blood flowing on this site.

michael September 10, 2010 at 3:06 pm

Excellent repartee, Joe. If I were poor I’d rather live in Denmark, Sweden or Norway. Even Trinidad would be above the USA. Down there everybody’s pretty poor and people look out for each other.

There are, of course, many places worse than here. I wouldn’t want to be poor, for instance, in Myanmar. Terrible place.

But if one were rich, have you noticed how many rich people find the old US of A to be their first choice? This is a FABULOUS place to be rich. So all the complaints I’m reading on this site do seem to have a, how shall I say this, a dog-in-the-manger quality about them.

Even me. I may not have made a large pile of cash, but I did retain enough to live like a rich man– in that I can buy anything I need and most of the things I want. (My wants are few.)

“What country do you thing you would have the best chance to better your condition? Do the poor in the US stay poor? Why do so many people want to come to this country?”

The USA, hands down. It’s our oppressive system of pervasive statist control. Nearly everywhere else is worse. People love it here! The taxes often go toward socially useful causes, and we are at least theoretically able to improve the quality of governance by throwing out the bad guys we find in high office.

We could do better. But at least the game is not doomed from the start, as it is in so many other countries.

” When you talk about “rich and powerful Capitalists”. I seriously doubt that anyone or business that goes to the federal government to get an advantage in the market is a Capitalist. I don’t consider, for example, GE a capitalistic enterprise. It sucks up big time to the federal government to get an advantage over it’s competitors.”

Amen to that. It’s all in your definition. Most of us would call any company that accumulates capital to build plant, employ people and make profits to be capitalist in form. Even when, as GE has done since WW Two, they rely on government contracts for their main bread and butter.

“As for the collaspe of the Soviet Union the standard of living went down because it was basically a welfare state. The citizens depended on the state for their livihood. Of course it would cause when the safety net was taken away.”

Let’s see if I understand your argument, Joe. The USSR was a welfare state, and provided minimal safety supports to its population. As it was a very poor country, spending most of its gains on the arms race instead of social services, they didn’t provide much. But when it transitioned to a capitalist enterprise in a decidedly Austrian mold, and all safety nets were removed, standards of living plummeted across the union.

That doesn’t say very much for your philosophy, Joe. It was tried and found wanting. Even today the Communist Party is far from dead. Many of the old folks look back on those days as the Good Times. Now they have to jump to the curb as rich men’s Benzes splash mud on them.

There’s no reason to believe it would happen any differently here. Were democracy to fall as utterly as did Communism one day, do you think those criminals in the woodwork would waste any time before they came to dominate the economy?

Thanks again for the spirited volley.

Eric September 6, 2010 at 3:47 pm

Micheal: What law would you enforce regarding the “saint working to alleviate suffering”? What law for the “serial child killer”.

How do you decide the above? Do you have a “Micheal’s world” list of good and bad acts? How do you decide on something new? Do you take a vote? What happens to the minority in that case?

Legislate morality? Legislate means force. Morality is a system whereby one can decide what actions are good or bad. Legislation is a system which decides when aggressive force can be used. These are two different things.

Libertarianism decides good and bad by the non-aggression axiom. Thus there would be no law compelling the saint, and the serial killer would be considered a criminal because of his aggression.

If the local town one lived in favored saintly actions, then saints could simply shun the non-saint. This would be a libertarian solution, since it does not involve aggression on the non-saint. Thus in the libertarian world, both could live side by side, with saints and non-saints choosing their friends accordingly. The libertarian solution permits both the saintly and non-saintly lifestyles. Only the non-aggression principle would be upheld by all.

In the libertarian world, conflict would be at a minimum. Freedom would be maximized, and competition amongst lifestyles would result. If the saints were in the minority, they could start their own town if they so choose. In the world that legislates morality, there would be less freedom, one rule would be forced on all. I’d prefer to live in the libertarian world. What about you?

michael September 7, 2010 at 7:29 am

“What law would you enforce regarding the “saint working to alleviate suffering”? What law for the “serial child killer”. How do you decide the above? Do you have a “Micheal’s world” list of good and bad acts? How do you decide on something new? Do you take a vote? What happens to the minority in that case?”

These are all questions that men of good will have to ask themselves, and one another. As I outlined in my answer, above, to Joe’s well expounded comment, we live in a world where there are no a priori rules for behavior, only behaviors (notwithstanding the assurances of the various religious books). And if we are not content with that, we have to define and dictate our own morality, as best we can.

It’s no easy job, building a just society. But it’s either that or live in the one you’re building for us.

“Legislate morality? Legislate means force. Morality is a system whereby one can decide what actions are good or bad. Legislation is a system which decides when aggressive force can be used. These are two different things.”

The problem with letting everyone obey only his own version of morality is that predators live among us. The child killer was my example. Should we just ‘live and let live’, let the children be killed according to his version of expediency, and let God sort it out in the hypothetical afterlife? I’m not the kind to be content with that. When we find such a person I have no problem with pulling him limb from limb in the public square.

One rule has to be forced on all, in this regard. And if we live in a society that disagrees with me, and says we don’t pull the offender limb from limb but deter him in some other fashion, I’m okay with that… to the degree that our collective decision has been arrived at by democratic means.

So who gets to decide? It’s us.

“In the world that legislates morality, there would be less freedom, one rule would be forced on all. I’d prefer to live in the libertarian world. What about you?”

In this country we legislate this kind of morality. We don’t do it perfectly, yet, but I intend to continue the task of bringing society toward a greater command of ethical behavior, through strict mandates that punish sociopathic behaviors. No ‘freedom’ for the evil doers to manipulate and control.

You are free to go elsewhere and build whatever kind of world floats your boat.

Russ the Apostate September 6, 2010 at 7:48 pm

God, you’re such a troll.

“If society fails to legislate morality, all morality will be voluntary.”

All morality worth the name is voluntary. Doing something “good” because you will not suffer from the blows of the compassion fascists if you do so, is not doing something good. By legislating all morality, a state would destroy morality utterly.

“Whether one is a serial child killer or a saint working to alleviate suffering, all ethical or moral behavior will be at one’s option.”

Pretty much all behavior is at anyone’s option. That’s what a free society is. The only caveat is that if you choose the option of becoming, say, a serial child killer, there will be repercussions.

As for Hayek, he was not a Social Darwinist, by any means. He was a classical liberal, who had no problem with charity, and certainly wasn’t opposed to ethics. And yes, he got somewhat inconsistent and muddle-headed in his old age. This happens sometimes.

Your problem seems to be that, like most lefties, you conflate the ethical and the political. For you, the political process is the only way of being ethical, so that individual ethics is washed away in collective politico-ethics. Pure Borg group-think.

Three card marny September 6, 2010 at 11:37 pm

Not a troll, a professional.

Inquisitor September 7, 2010 at 12:55 am

A professional troll. :)

Inquisitor September 7, 2010 at 1:01 am

I can’t recall where I read it but Hayek was rather opposed to social darwinism iirc, at least in its classical forms. It’s amazing how a clueless hack like Michael can turn him into one, though. Anything anti-statist is “social darwinism” to left “liberals” though. God forbid one has to compete and cooperate voluntarily, why we’d all perish…

michael September 7, 2010 at 7:36 am

“Anything anti-statist is “social darwinism” to left “liberals” though.”

A muddled statement. Compare with my interlinear, above to Hayek’s Philosophy of Mind & His Social Theory: Beyond Kantianism (Leonard P. Liggio). Liggio describes a moral universe that is at the same time akin to that of Social Darwinism and Catholicism. One with unchanging, eternal rules imposed on us from above, rules we should not and probably cannot challenge.

“God forbid one has to compete and cooperate voluntarily, why we’d all perish…”

In such a world the strong would rule the weak. Uh, wait a minute… that’s the world we live in now! So the humanist’s effort is directed at forming a force powerful enough to overcome the strong and protect the weak from exploitation.

None of us are free while any among us are in chains.

Inquisitor September 7, 2010 at 10:43 pm

I cannot even make sense of your babbling anymore… what does any of this have to do with what I said?

Joe September 11, 2010 at 9:32 pm

Michael, Just to let you know that Russia did not change to a capitalist society. You don’t think Putin and his buddies would let that happen. As for the welfare state in Russia it was not the one we are creating in this country. Russia kept its people just alive unless you belonged to the Communist Party. So what little help the people got they lived on. Take it away and they had to try and survive on their own.
A country that you need to watch is China. They are socialist but they found out the savior for their failed philosphy. Be a parisite and let enough Capitalism in the country to save their sorry butts.

michael September 12, 2010 at 2:11 pm

China is not socialist, Joe. Out in the remoter provinces they’ve had to retain a few government-supported programs, just to keep those people contented that haven’t yet been able to join the new China. But mostly, a long time ago their economic system became thoroughly capitalist, of the state-directed variety.

The distinction to be made is that China, is centrally controlled and directed. It’s an authoritarian society, with great economic freedoms and terrible political ones.

This actually puts China at an advantage, relative to us. We allow individuals to make their own financial decisions, and as a direct result the herd mentality sends investors routinely over the cliff, like so many stampeding buffalo. In China, the major investment decisions are made by that state. And their technocrats are able to make the best use of their funds with an eye toward the development of the entire country as one single organism.

Creepy, huh? But it works. Better than ours does.

nate September 12, 2010 at 2:55 pm

“”But mostly, a long time ago their economic system became thoroughly capitalist, of the state-directed variety”"

Thats socialism. The term ‘socialism’ covers more then just a narrow definition that the communists favored.

“”Creepy, huh? But it works. Better than ours does.”"

No it does not.

michael September 13, 2010 at 9:53 am

“”But mostly, a long time ago their economic system became thoroughly capitalist, of the state-directed variety””

“Thats socialism. The term ‘socialism’ covers more then just a narrow definition that the communists favored.”

Nate, the trouble with debating Austrians is that you fellows have different definitions for many of the words than those used by the rest of the world. Allow me to clarify:

Most people consider socialism to be a form of government where the State redistributes wealth from the rich to the poor, to alleviate injustice and promote a degree of social equity. They would consider the US government to be an example of “mixed” government, in which the redistributive powers awarded money first to other capitalists, and only to a lesser degree to the deserving poor or working poor.

Also the Austrian version would say that money redistributed in taxes came from the rich and was awarded to the poor. When as we know, tax rates for unearned income, such as dividend earnings or capital gains, gets taxed at a preferential rate to income from wages and salaries, which is fully taxed. Also the first $100,000 of income (approx.) is subject to payroll tax, meaning that all income above that mark is exempt.

So on both those counts I would suggest that we do not live under a socialist government. We live in a mixed economy, with some features of each.

Also, when I said that China’s system worked better than ours, what I was referring to was the fact that we have a chronic trade imbalance, whereby we transfer dollars to China while they transfer manufactured goods to us. That kind of trade is to their great benefit. So I think they have the superior system, seen from the point of view of the two competing governments.

Obviously, seen from the POV of the little guy, you’d rather see a libertarian utopia, unlike either giant.

Matthew Swaringen September 11, 2010 at 9:54 pm

“None of us are free while any among us are in chains.”

So your solution is to make us all “free” by chaining us all with regulations, taxes, and redistribution schemes.

gregw September 7, 2010 at 7:25 pm

inq> “I can’t recall where I read it but Hayek was rather opposed to social darwinism iirc, at least in its classical forms.”

Well he certainly mentioned/criticized it in The Fatal Conceit. Quite briefly, though.

michael September 8, 2010 at 8:58 am

gregw: Social Darwinism is implicit in any creed that emphasizes the successful should seek greater wealth and be unimpeded by any societal brake on that pursuit. None of the Austrian masters has anything good to say about compensating mechanisms. The rich should simply prosper, while the losers fall by the wayside. That’s Social Darwinism, no matter what they call it.

mpolzkill September 8, 2010 at 9:09 am

Fall by the wayside in being rewarded, because they have failed to serve their customers. We want more people to be served, we think that they can know when that’s being done. The disconnect comes in because upper-class lefties obviously think that the masses are mentally inferior and don’t know what’s good for them.

michael September 13, 2010 at 10:02 am

Most business failures today occur not from any defect in the company’s business plan or problem marketing to their target audience, but rather due to the general failure of credit extension during times of contraction like the present. (Or like the Great Depression.) They run out of short-term funding for their daily operations.

This, to me, is an excellent argument for the retention of the Fed… so there can be a lender of last resort in such instances.

You can ask me to support that contention about “most business failures”, if you hope you’ll be putting me to a lot of bother. But it would be easier if you either just accept it as being an obvious fact, or dismiss it without a second thought.

Gil September 7, 2010 at 3:32 am

No it isn’t. True morality involves people getting punished for their crimes. People merely being “shunned” for extremely serious crimes is a joke. Are you supposing “well the families of the victim will take matters into to their own hands is good because they’re using their time, effort and resources to obtain rather than enslaving the taxpayer”?

Franklin September 7, 2010 at 7:34 pm

Well, come to think of it, the “family taking matters into their own hands” would oftentimes be infinitely more just and appropriate than the statist, apathetic disregard for victims that passes for justice now.
And sound anti-recidivism, to boot.
‘course, the revenue gravy train for some attorneys (though not all) would diminish.

michael September 8, 2010 at 11:10 am

“God, you’re such a troll.”

Not useful, Russ. Try to stay on theme, it’s more productive.

“All morality worth the name is voluntary. Doing something “good” because you will not suffer from the blows of the compassion fascists if you do so, is not doing something good. By legislating all morality, a state would destroy morality utterly.”

That’s a self-centered view. Instead, if we’re world-centered, what I’m talking about is that if morality is voluntary, we’re at the mercy of the sociopaths in the population.

Do you really think the purpose of laws is to keep the honest people in line? That’s peripheral to the main point. Without strong laws against felonious activity we’re prey to the wolves among us. You have to legislate morality, when we have people who don’t possess it.

“As for Hayek, he was not a Social Darwinist, by any means.”

He may have protested against it. But actions speak louder than words. He endorsed a world where the economically fittest should prevail over those less fit. And he thought that while there might be room for personal charity, there was no purpose to be served in any societal response to the problem of endemic poverty. That view is consonant with Social Darwinism, by any name.

Russ the Apostate September 8, 2010 at 4:26 pm

“Instead, if we’re world-centered, what I’m talking about is that if morality is voluntary, we’re at the mercy of the sociopaths in the population.”

I’m not saying that there should be no laws against certain things. The phrase “legislating morality” generally means that there are laws enacted forcing people to do “good” things. I’m a classical liberal, not an anarchist.

“And he thought that while there might be room for personal charity, there was no purpose to be served in any societal response to the problem of endemic poverty. That view is consonant with Social Darwinism, by any name.”

So freedom is consonant with Social Darwinism, huh?

michael September 10, 2010 at 3:39 pm

“So freedom is consonant with Social Darwinism, huh?”

Right. Under Libertarian rule we are all free to prey on one another. It’s market forces at their purest.

Franklin September 10, 2010 at 3:56 pm

Incorrect. Yet again.
There is no such thing as Libertarian “rule.”
There is libertarian behavior, which is live and let live and refrain from initiation of force.
Those who violate that behavior fail to prosper and, ultimately, fail to survive.
Why you continually wish to defend and sometimes even champion agression (short of being criminal, which I certainly doubt you are) is just thoroughly perplexing. And sad.

michael September 13, 2010 at 10:05 am

Franklin: I personally would find libertarian rule to be oppressive. That is, it would not allow the sorts of market interventions that many Americans have come to think of as being necessary social safety nets.

Polls show that even among self-identified “tea partiers” a majority are glad we have institutions like Social Security, Medicare-Medicaid, unemployment insurance and federal deposit insurance. Rule by Austrians would destroy all their safety nets.

mpolzkill September 13, 2010 at 10:10 am

“even among self-identified ‘tea partiers’”

I love this brand of propaganda:

“even total morons agree”

michael September 13, 2010 at 10:24 am

The Tea Party is the one political grouping in America that most reflects your ideals. That is, they want Big Gubmit off their backs. But they’re not very consistent in their philosophy. They usually add “except for my Social Security and Medicare”.

mpolzkill September 13, 2010 at 10:32 am

“most reflects your ideals.”

That is what Michael would like to suggest, and it is why he and people as disparate as Keith Olbermann and our very own Russ the Anonymous Zionist try to pretend like Ron Paul doesn’t even exist.

Jake_nonphixion September 6, 2010 at 4:12 pm

I don’t have any moral qualms with mutually consensual cannibalism. If dude wants to get eaten, let the dude get eaten :)

I do have a question where libertarians stand on children’s rights however… Say an autarchical libertopia emerged – full with the well established system of private courts and private enforcement/punishment companies. I am aware of the argument for spontaneously emerging ‘natural’ rights, similar to the rules of grammar or physics, and I find this concept plausible, though I am not convinced that these rights would be universal constants. I think that these rights would form a base-line that varies slightly with societal preference depending on location. The problem is, that I foresee small localities arising which cater to varying degrees of moral/ethical codes. Self sufficient localities could arise that would even be extreme, and cater to humanity’s somewhat perverted sexual nature. One such locality might arise where pedophiles could voluntarily exchange their resources with a child prostitute. It is obvious that there already exists demand to fill that demented niche, looking at Indonesia as well as the black market of the US.

I realize that I already admitted that I’m not really comparing apples to apples here, since the problem that I’m posing already exists… but I can’t help but think that it could be worse for this one little issue without a central authority.

I guess it also begs the question, when are children considered mature enough to interact on their own behalf? Any age would have to be determined arbitrarily…

Jay Lakner September 6, 2010 at 5:15 pm

This is simply an extention of the “abortion” debate.

I think the market can solve this far better than any central authority.
I would imagine that private protection agencies would have a contractual agreement with their customers preventing them from harming their own children.

Who’s going to sign up with an agency that protects child molesters and child murderers?

Some agencies will allow abortion, others will allow abortion up to X months, others will not allow abortion at all. Some may even allow “aborting” children aged 2 years and lower, but I don’t think they’ll survive for long. Reputation is a powerful thing.

In a free market, we should end up with a range of possibilities. The agencies that allow morally abhorrent behaviour will go bankrupt, the agencies that only allow morally virtuous behaviour will prosper. The free market is the only true democracy.

Free Market Phooey September 7, 2010 at 7:01 am

That free market you describe sounds pretty much like what goes on today on earth. Each government does what it wants to. Many kinds of killing are included.
I am pleased (for your sake) that you approve of the arrangement.

michael September 7, 2010 at 7:44 am

“I think the market can solve this far better than any central authority. I would imagine that private protection agencies would have a contractual agreement with their customers preventing them from harming their own children.”

So that persons able to afford the dues and fees could have their own children protected against exploitation, while those too poor to afford it would have no protections. That only means the sex trade would have an endless supply of unprotected children to procure and use up.

That’s the world we live in today. It’s a totally corrupted moral universe. It’s like the traffic in kidneys and other body parts. I’m sure you take the position that if someone ‘wants’ to sell his kidney, it’s just his business and no one else’s. Likewise if a destitute family is forced to sell a child, it’s their own act of free will.

I’m very impressed.

“Who’s going to sign up with an agency that protects child molesters and child murderers?”

Why, all the child molesters and murderers, of course. They’d become a force in the protection of their own mutual interests, and would run ads on Craig’s List for children freely made available for sale. A free market in children would become established.

“The free market is the only true democracy.”

Vedpushpa September 6, 2010 at 10:36 pm

IN ESSENC – fair price, good value.just price,ethical business,social responsibility,right to self-actualization, give your maximum and take your minimum etc are all ONE and the Same Virtue.

Hence – Sustaining Business/Commerce, Ethics. Morality and Business Philosophy, Worldly wisdom are all one and he same virtue. The quibbs and quarrells are there because of the shortsighted intellectual theorizings or because of inaate badness of the human individuals of the context.

But as regards justifications of due punishment’ or due modes of punishment for any offence — an eco-political worst inclusive… the idea of sanctioning the torture of an ‘innocent’ affectionate[and a child at that as in the sighted instance of this article] of the suspected terrorist/culprit is just not ‘the right thing’ do do. That amounts to a worse crime than the one to be judged…. this act is a wanton one . and hence a sure and certain’ No’ to that.

Capitalism is okay so long as its aberrations of ‘run away capitalism’ or the ‘government sponsored or indulged-in capitalism’ are not sanctioned.

The damning and dangerour intellectual aberration that has got into the psyche of humanity of humanity since the last century over – namely the wrong appropriation of the business or production-disbursement modes of Capitalism and Communism – two valid economic modes have got sanctioned as ‘some valid Political Theories and Policies’…

Lets call off this Hoax and go back
defining the POLITY as ‘A People sanctioned Co-ercive Power that has necessarily to Be used by the people’s sanction and for the welfare of their Land as a whole’ !!
Let not the disposal problem of the load of “Literature to the contrary’ deter us… Let us look at the Lodestar instead !!
vedapushpa
social anthropologist/activist
India

Vedpushpa September 6, 2010 at 10:43 pm

Sorry for not editing the wrong spellings …sorry for the annoyance.

Raimondas September 6, 2010 at 11:53 pm

I am Catholic and have no problems “as morally acceptable”; I am responsible against Jesus Christ. Laws as devised by people always would be merely highly imperfect and poor reflection of moral.

Gil September 7, 2010 at 3:25 am

Test.

John B September 7, 2010 at 6:05 am

It seems to me, over and over again, that the best thing that humans can do, nevermind just libertarians, is indeed to back off and leave other people alone as much as possible, from a controlling point of view.
The desire to interfere with other people’s lives and tell others what they may or may not do seems to be the root of all misery on this planet, from a human perspective.
As soon as the state, the Co-op, the local community organisation, or even IBM starts to tell others what they may/not do they are assuming a role for which no human is naturally equipped in the long term.
Sure, we can offer some short term guidance, but as soon as a person or group of people set themselves up as an authority, they will be in permanent warfare with their own fallible natures and thus tempted by greed of whatever type.
The free market at least allows all the individual greeds to balance against each other, and further, we are surely not totally devoid of love and mercy ?
If mercy and love were found to be completely lacking in a genuinely free, libertarian, environment, then that would say something about human nature that would indicate its ultimate inability to survive without the intervention of God.
But no man, woman nor state can be God.

michael September 7, 2010 at 7:51 am

“It seems to me, over and over again, that the best thing that humans can do, nevermind just libertarians, is indeed to back off and leave other people alone as much as possible, from a controlling point of view.”

The only problem is, that has never worked well. The period prior to the establishment of laws was a horrible one.

One of the first real fascist takeovers was that of the Assyrians. Everyone was all laissez faire, living and letting live, until the Assyrians came to town. Then the invaders flayed alive everyone they didn’t want to keep as their slaves.

We need laws to condemn this kind of behavior, and capable enforcers to deter it. And we’re still only in the early stages of establishing such laws. One version I like is the UN’s Universal Declaration of Human Rights.

“But no man, woman nor state can be God.”

The Catholic hierarchy says the same thing. There’s no way you can ever presume to rival God. So just lie back, smile, and let us take care of everything. We’re on first name terms with Him.

John B September 7, 2010 at 8:37 am

Michael,
So the Catholic hierarchy were making the laws and presuming to tell everyone what to do?
Another example of some people interfering in the lives of others, whatever the assumed authority under which they claimed to operate.
I am sure there are many examples of violence and butchery worse than the Assyrians you mention. I don’t really see laws or me telling someone else what to do helping to stop them if they were not interested in one’s laws in the first place?
If you are going to take final control back to some human authority you are going to have to trust that authority to be moral and/or benevolent.
It is not possible to ensure that or even, probably, to find that.
As we enter an age when total control becomes possible, who is going to control the controllers?

michael September 7, 2010 at 11:50 am

There’s actually no instance in history of anyone acting worse than the Assyrians. As bad as, sure, many times.

And as for my comments about Catholicism, I am just now noting the similarity between their method of knowing and that of the Austrians. It has to do with faith, imposed on one by his superiors. In this case, intellectual superiors. (I find hardly anyone in this forum to be the intellectual equal of the people who wrote the canon, i.e. Hayek, Mises, Rothbard…). It is, at bottom, an act of will. An outgrowth of the postulate “man acts”.

“If you are going to take final control back to some human authority you are going to have to trust that authority to be moral and/or benevolent.”

Trust no one. Every morning you have to re-evaluate your position in relation to the acts of the society you declare membership in. And you have to re-evaluate your own every action in light of whether, in retrospect, it was the right thing to do.

It’s a constant responsibility, being human. Far more of a burden than just assigning all moral and ethical questions to a Supreme Being, or a Supreme Philosophical Model.

J. Murray September 7, 2010 at 11:53 am

“There’s actually no instance in history of anyone acting worse than the Assyrians.”

They have nothing on:

Celts
Gauls
Vikings
Aztecs
North Koreans
Soviets
Cambodians
Spanish
Burmese

There are plenty worse than the Assyrians.

Joe September 7, 2010 at 12:09 pm

Michael,
The Russians under Stalin had laws and lo and behold the great dictator murdered millions of his own people. Why go back to the Assyrians? Just go back to the 20th century. Wasn’t Mao, Pol Pot, Hitler, Mussolini and all the other socialists and communists enough for you? These clowns had their own laws and edicts and it didn’t work out very much for the poor citizens having to deal with their “social justice”.

michael September 8, 2010 at 11:15 am

Russia, and in fact all of Eastern Europe, has had no tradition of rule by law. It has always had rule by men. The laws on the books under the Soviet constitution were no impediment to Joseph Stalin.

“Why go back to the Assyrians? Just go back to the 20th century. Wasn’t Mao, Pol Pot, Hitler, Mussolini and all the other socialists and communists enough for you?”

You’ll find no disagreement from me. They’re all pretty similar. So far as we know, though, the Assyrians never put a gloss on their designs, that their barbarity served some social purpose. They just skinned their victims alive because they thought it was fun.

Justifications for barbarity are a 20th century thing. Plus, the technology of death has grown more efficient.

Richie September 7, 2010 at 1:26 pm

“(I find hardly anyone in this forum to be the intellectual equal of the people who wrote the canon, i.e. Hayek, Mises, Rothbard…)”

Nice little attempt to distract us Michael. What is your point here exactly, other than to stir up emotional responses and to get people to insult you?

michael September 8, 2010 at 9:01 am

“What is your point here exactly, other than to stir up emotional responses and to get people to insult you?”

Richie: The point is, I’m getting very bad arguments in return for my own. Hayek and Mises have some good arguments. These people don’t. And the people here are the ones I’m debating, not Mises. He’s unable to appear.

You all need to be coming up with better arguments. Instead, all I’m getting is mere insults. J Murray, today, has actually come up with some good arguments. Be more like him.

Russ the Apostate September 7, 2010 at 1:38 pm

“(I find hardly anyone in this forum to be the intellectual equal of the people who wrote the canon, i.e. Hayek, Mises, Rothbard…). ”

I agree. I am certainly not in their league. But on the other hand, I hardly find you in the same league as somebody like Keynes, even though I recently said elsewhere in this blog that I consider him a second-stringer.

And even though I don’t agree with Austrian anti-empiricism, I think you are severely mischaracterizing it. (Probably because you refuse to take it seriously, even provisionally, and thus, don’t understand it.) Austrians don’t believe as an act of will. They believe that certain things should be taken as a starting point for economic deduciton, based on either a Kantian basis (ala Mises) in which the starting points are necessarily true empirical statements, or a more Thomist-Aristotelian approach (ala Rothbard) where the starting points are not necessarily true but are self-evident to the casual observer.

michael September 8, 2010 at 9:10 am

Russ: What I’m saying is that the majority of people screaming at me to just shut up are unfamiliar with the elements of debate. They’re either unwilling or unable to take something I’ve said and call it into question, much less refute it. They’re unable to draw on observation rather than unsupported theory to ‘prove’ an argument. They just don’t use their intelligence in a functional manner.

I’ll be more than pleased to consider any refutation of something I’ve actually said. And even more pleased if it draws on some body of observation to make its point. Instead I get a dense fog of hostility, more often than not uninformed as to what I’ve actually said.

Let’s start with this basis: deductive methods are invaluable in posing a proper hypothesis. Once made, it can’t be presumed to be true until it is falsified– that is, tested to find cases in which it does not operate. That, in short, is the inductive method of knowledge.

You all are very facile with the first approach: giving mouth to unsupported opinions, as informed by your pantheon of great masters. But no one ever attempts, or even sees any need for, the second step.

That makes your body of knowledge a false edifice. Let’s see some better work here, guys. Prove it!

michael September 8, 2010 at 9:13 am

“I hardly find you in the same league as somebody like Keynes, even though I recently said elsewhere in this blog that I consider him a second-stringer.”

A note on Keynes, Russ. All my insights have been gained form a lifetime of personal observation; I’ve never been a theorist. But when I began to appear in forums like this one, everyone always called me a Keynesian. So I read some of his stuff. And I find he’s come to the same conclusions I have.

Richie September 8, 2010 at 11:17 am

You stated once that no minimum wage existed in 1946. That alone proves your ignorance. You cannot debate. You do not have the intellectual capacity to do such. I am no longer responding to you. This is it. Have your fun while you can. Goodbye.

michael September 8, 2010 at 12:11 pm

“You stated once that no minimum wage existed in 1946. That alone proves your ignorance. You cannot debate. You do not have the intellectual capacity to do such.” etc.

Richie, you’re being a bit of a sourpuss. How long have you nurtured that grievance? Months?

What I intended to say was that back in the sixties and early seventies, there was only an interstate minimum wage. Companies doing business within a single state were under no mandate to pay anything other than what state law required. So there was no minimum wage binding across the country on all workers. I had to work for less than the federal minimum, many times.

But please don’t change. I like you just the way you are.

Russ the Apostate September 8, 2010 at 12:46 pm

michael wrote:
“All my insights have been gained form a lifetime of personal observation; I’ve never been a theorist. But when I began to appear in forums like this one, everyone always called me a Keynesian. So I read some of his stuff. And I find he’s come to the same conclusions I have.”

Yes, which means that you also hold to a theory of economics – ideas on how an economy works, as opposed to a disconnected mass of mere empirical facts – just like Keynes did. The problem is that there are a lot of arguments, involving facts (i.e. stagflation, the Japanese lost decade, etc.), that seem to falsify Keynesian theory. You seem to blithely ignore these arguments, much as you accuse Austrians of doing. You simply keep on restating your Keynesian theories. You say the inherent flaws of capitalism and/or proto-Austrian policy caused the Great Depression; Austrians say that Fed and government Keynesian policy caused it. You say FDR and WWII got us out of the Great Depression; Austrians say that we didn’t get out of it until after WWII was over and the Republican Congress took over circa Truman. Basically, you and the Austrians disagree on causality. Why? Because you have different theories that explain causality. How is either side going to convince the other side it’s wrong with mere facts, when you disagree on what the facts mean because of your differing theories that you use to interpret the meaning of the facts?! You can’t easily falsify theories based on facts, when the facts have different implications when interpreted in the light of the competing theories. What to do?

The only solution I can see, if there is a solution, is to logically analyze the competing theories. Use really basic facts we can all agree on, and see if these theories can be derived from these basic facts. A theory that can be derived logically is probably more right than one which cannot be derived in this way, and is just pulled out of somebody’s ass (pardon my French). This is basically what Austrians do, in my opinion (although I am sure I will get some quibblers on this). And in fact, you do this too (even though you claim to be purely pragmatic, facts-driven and theory-free) every time you try to logically, deductively explain how wealth trickles up and accumulates. You are a theoriest, despite your claims to the contrary, and well you should be. Theory isn’t nothing; because of the difficulties inherent in falsifying economic theories, when it comes to anything more than the most basic stuff, theory is everything.

michael September 8, 2010 at 12:55 pm

“The problem is that there are a lot of arguments, involving facts (i.e. stagflation, the Japanese lost decade, etc.), that seem to falsify Keynesian theory. You seem to blithely ignore these arguments, much as you accuse Austrians of doing. You simply keep on restating your Keynesian theories.”

Your posts are getting better, Russ. I think you point to a great truth: there’s no overarching theory that’s useful in every conceivable instance. Some are more appropriate some times while others fit the case at other times. So we have to go with whatever seems most fitting in our present circumstances.

We do have a precedent for taking no action in a recession: the events of 1929-32. Taking no action, in circumstances very similar to our own today, makes things worse.

That happens to be Keynesian. If, on the other hand, the economy was doing just fine, and some numbnut at the Fed decided he’d make it even better by flooding the market with cheap, undeserved credit, that would be a terrible mistake. The Austrians would then rightly point that out.

And in fact that’s what happened around 2004-05. The economy had fully recovered from the dot-com bust, yet the Fed, unaccountably, did not raise rates and tighten up the money supply. Here I would agree with the Austrians that that was a big mistake, leading in part to our problems today. Blame Alan Greenspan.

To everything there is a season, Russ. What’s important is not unswerving allegiance, in every instance, to one theory as opposed to all the others. It’s finding which among the theories fits the circumstance under examination. Theories are just templates against which we try to match complex events.

michael September 8, 2010 at 1:11 pm

Erratum: I sent this last one too quickly.

Where I said “The economy had fully recovered from the dot-com bust, yet the Fed, unaccountably, did not raise rates and tighten up the money supply.” I should have said they did not raise rates ENOUGH TO tighten up the money supply. The Fed Funds Target Rate did go from one percent up to something like 5-1/4% by the end of 2006. But the move had little effect. There was still way too much money in the system, and the rate rise was far too slow to have any effect.

As Nouriel Roubini puts it, “The result was the housing and mortgage bubble. By pumping vast amounts of easy money into the economy, and keeping it there for too long, Greenspan muted the effects of one bubble’s collapse by inflating an entirely new one. This policy was the inevitable consequence of the contradiction at the heart of his approach to central banking: helplessly watching bubbles on the way up, and moving frantically to arrest the downward slide.” (from Crisis Economics)

See? That doesn’t sound very Keynesian. Yet I see the sense in it.

Russ the Apostate September 8, 2010 at 5:00 pm

“Your posts are getting better, Russ. I think you point to a great truth: there’s no overarching theory that’s useful in every conceivable instance. Some are more appropriate some times while others fit the case at other times. So we have to go with whatever seems most fitting in our present circumstances.”

Leave it to you, Michael, to separate the wheat from the chaff…. and then throw out the wheat!

I was most certainly not saying anything even remotely resembling what you said above; i.e. there’s no overarching theory that’s useful in every conceivable instance. I was pointing out the difficulty of falsifiying economic theory. This in no way relieves us of the duty of trying to determine, somehow, what the correct theory actually is. I’m not necessarily saying that Austrian theory is the inerrant Gospel. But, mixing and matching in some sort of insane cafeteria economics, where you can take anything you like off the buffet to suit your taste of the moment, is not the answer. How can a mish-mash of theories be correct, if the theories logically contradict one another? Do you really believe that anything that can be said to be amenable to science, can be that self-contradictory?

If you believe in the Austrian theory of the cause of recessions, then you should understand that the only real solution to recessions, according to that theory, is to prevent them. According to the logic of the Austrian theory, by the time that the Depression was happening, it was too late to do anything except suck up the pain. It also says that attempted quick fixes will, in the not-so-short term, make the problem worse. If you want to switch to another theory that allows a quick fix at this point, then you don’t really understand or believe in the Austrian theory, because the logic of the Austrian theory doesn’t allow this.

It’s like if you have a theory that alcohol causes hangovers, and the theory says that the only way to avoid hangovers is to not drink. Once the alcohol is metabolizing and giving you that giddy feeling, it may already be too late. Once your head is swimming, you are seeing double, and you’re starting to feel sick to your stomach, it’s definitely too late. You can’t just switch to another theory that promises a quick fix. Hair of the dog? It does work for a very short time, but then you feel even worse than before. The only way to keep up the hair of the dog solution would be to keep drinking forever. Probably not the right solution.

But, economically, you are advocating the hair of the dog, and if that doesn’t work, more hair of the dog, etc., etc., ad nauseum. This was tried, during the Great Depression, and it is what made the Great Depression GREAT! The Austrians are advocating sobriety.

michael September 12, 2010 at 2:15 pm

The Great Depression became great back when everyone was just standing around watching it grow. Then when we started doing something about it, even if it was wrong, it started easing up.

Then when we tried balancing the budget prematurely we sent the country back into a second wave. I can see trying everything you can, by whatever theory best fits the facts. But I don’t see trying the same things now that made everything worse back in 1937.

Thinker September 12, 2010 at 2:57 pm

michael,

“The Great Depression became great back when everyone was just standing around watching it grow. Then when we started doing something about it, even if it was wrong, it started easing up.”

I wonder how many times has this general statement has been made: “Hoover did nothing, and things got bad; Roosevelt did something and things got better.” The dichotomy is false, and has been repeatedly shown to be such. Hoover was an active interventionist, and his interventions have been convincingly blamed for the “greatness” of the Great Depression, and not only by Austrians–even the illustrious Paul Krugman agrees that the Smoot-Hawley Tariff and the ensuing global trade war contributed significantly to the decline. This has been explained to you repeatedly, and your apparently willful ignorance of the details of history is more than a little grating. If you insist that abstract theory cannot be used to explain events, only concrete observations, then you should at least use correct observations, not middle-school level narrative.

mpolzkill September 12, 2010 at 3:05 pm

“I wonder how many times has this general statement has been made”

Worked for Goebbels, for awhile.

Free Market Phooey September 7, 2010 at 6:56 am

What a lot of waffle. What’s the right thing to do? Do unto others are you would have them do unto you.
You guys need to get back to basics. Who gives a shit what Hayek thought or wrote many years ago? Hayek was forced to live under the ruling gang of his day, as we must live under the ruling gangs of today.

TokyoTom September 7, 2010 at 7:45 am

It seems to me that as a libertarian, the “Right Thing To DO” is to recognize that no man is an island, and to work to build the sense of community and mutual obligation that the state and statist corporations have been remarkably successful at undermining and replacing with atomized and alienated individuals in mass society.

mpolzkill September 7, 2010 at 7:55 am

Hey Tom, nice to hear from you. Good stuff.

- – - – - – - – - – - -

Are you impressed with the progress your boy Michael is making? Though I guess it’s just because all the other kids are so mean to him.

fundamentalist September 7, 2010 at 10:36 am

Thanks for the book review, but I don’t think I’ll read it. Sounds too lame. Take Sandel’s complaint about greed. How does he know that the price gouger in a natural disaster is engaging in greed? He would have to be able to discern the “thoughts and intents” of the heart, which he can’t do, and neither can any man. The Church Scholastics considered the same problem and determined that raising prices during a natural disaster is not greed. So where does Sandel get the balls to call it greed?

And even if we followed Sandel in having the state legislate virtue, whose virtue would we choose? In our society it would be the virtue that the majority prefers, which would give the majority license to oppress the minority that disagreed. And what if the majority decided it wanted to murder all of the Jews?

The state has a well-defined role to protect life, liberty and property. Virtue is the real of religion, not the state. Let each perform its function without interference with the other.

billwald September 7, 2010 at 7:10 pm

(I ask) For several decades Stalin was at least the 2nd most important person in the world. When Stalin died, how large was the personal estate he left behind?

“Up to now iron party discipline has limited all Communists—including the Dictator—to a salary of $1,800 per year. In proposing to jack this up to $5,400 Mr. Stalin naturally had to act with caution. The change was only being “considered,” ran the public announcement last week, but such public “consideration” is the Dictator’s mode of feeling his way, is usually followed by action.”

Read more: http://www.time.com/time/magazine/article/0,9171,743509,00.html#ixzz0ytKHcbPu

My point? That economic issues are one level down. The top level is raw power. Say in the next age energy is free and the nasty work, even the nice work, is or can be done by machines. Consumer good appear as desired from a machine on the wall as in Star Trek. No one needs money. Who lives on Lake Washington?

In the Seattle area the most expensive real estate is Lake Washington waterfront. When no one needs money, who lives on Lake Washington? OK, we will make the entire Lake Washington waterfront into a public park. Who lives across the street from Lake Washington Public Park?

Perry Mason September 8, 2010 at 10:16 am

Seems to me what Sandel *completely* misses is the scholarship of Hoppe (and others), particularly:

(1) the backwards incentive of democratic states, in which time preferences rise (including the debauchery / instant gratification associated with it), making them ill-suited to legislate “virtue”

(2) the natural tendency of free, decentralized societies to expel anti-social behavior without the use of brute force, far more than any government, by responding to the natural incentives of responsible people

Third, which is the addition of others, is the reality of sin. Without writing a novel on a blog, there is much to know and explore in the relationship that sin (e.g., envy) has to coercive power, and the risks in granting such coercive power without the concomitant checks/balances of a voluntary exchange.

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