Wednesday, December 27, 2006

pseudos etumos-logos

Wherein I pretend to dabble in the dark arts of etymology, I tend to discover inner meaning when there really isn't any. For example, a common slur against Iranian Jews is to stereotype their frugality. Hence, the term parsimony has special meaning to me as it may be broken down to the [false] roots 'parsi' + 'mony', 'Parsi' being the Hebrew word for "Persian".

Another such example would be to relate the word "Hasidic", which in its original Hebrew sense did not depict a Jew wearing a funky hat, curly sidelocks and a black frock. Instead, in Mishnaic terms it referred to a person who refrained from the pleasures of the world, choosing to live the most basic, ascetic life.

Where am I going with this? Well I wanted to devise an explanation for the division of man-made law into two categories:

1) common law
2) private law

The difference between the two is lies in it's origination. I reckon that the typical origination of common law was a spontaneous arrangement of acceptable, universalized principles which civilized society could easily agree to, such as prohibition against murder, enslavement and robbery. These are such prohibitive laws that from the viewpoint of the individual are obvious (since the prohibited action is clearly harmful to another party), and need not to be instilled for one to be aware of them (and I stop short of referring to these as 'natural laws'.)

Private law, or positive law on the other hand, is comprised of laws which are many times non-obvious, and therefore to be known must be learned (although one will be found guilty in unknowing transgression, since ignorance of the law is not an excuse.) The law's prohibited action might be seemingly or truly harmless, and one might be found guilty in the nebulous sense of committing a "crime against society". These laws, even if well-intentioned, will favor the interests of a private few, required active legislation to define them, coercion to gain their employ, and in effect lead to the breakdown of, and de-civilize society.

R.A.W. (and R.S.) said it squarely, or rather, Hagbard Celine did:

PRIVILEGE: From the latin privi, private, and lege, law. An advantage granted by the State and protected by its powers of coercion. A law for private benefit.

With this historical background, we can better grasp the typical hurdle often encountered by many an anarchist in the conflation of these two types of law. It is the difference between the two law types that anarchists object to when they object to rulers, but not rules.

What anarchists may or may not realize, privilege-private laws are those "rules" which beneath the print are just rulers disguising themselves in the rubric of rules in order to demand obedience and/or enslavement. These pseudo rules do not arise from conflict-reducing norms, and in fact create more conflict.

Private laws are those which anarchists are most confident will not arise in a market-anarchy, whilst the common law they hope will be rigorously obeyed, whether out of a sense of common decency (in my belief), or because of an expectation that the market institutions will have a much better replacement to the state's pathetically useless enforcement agencies.

Monday, December 18, 2006

impromptu thoughts

In the never-ending debate of nature vs. nurture; doesn't the latter approach run into a regression problem? What I mean is that if we consider a man's behavior to be the product of the inputs of his social environment, where did the social environment originate those inputs?

Wednesday, December 13, 2006

quixotic exotics

Catallarchy commenter Sam writes in regards to so-called 'exotic' goods:

"This is an issue for semantics only. A good is not merely a physical commodity, but a commodity acquired for the purpose of providing satisfaction to the consumer. If “$20k Rolls-Royce” and “$60k Rolls-Royce” provide different levels of satisfaction, then they are, in fact, different goods."

From a March 16th 2006 email to Professor Emeritus Walter Block,

"My thoughts about the phenomenon of veblen and giffen goods are such and I would like your comment. In economics, goods can be said to be homogeneous if the units supply the same exact service. If there is any differentiation, even if but a psychological differentiation (such as ice in the winter being a different good than ice in the summer), under the scope of economics they are considered to be two different goods.

So too, "goods" as regarded by economics should not include special categories for either veblen or geffen goods, because the goods in question (either a veblen status-good, or a giffen substitute-good) have essentially transformed into another type of good providing a different array of services. There is nothing special about either of these to qualify for an "exotic good" category, as the theory only gives an explanation why the good transformation should occur.

Any child could come up with examples of goods which transform into other goods and provide a sound explanation; for example, a fur coat in the winter and summer, a pastrami sandwich before and after eating a filling meal, popcorn during a movie and afterwards, a discount coupon before and after making a purchase, etc.

If this is so, would it be correct to ignore such so-called exotic goods, despite the mainstream acceptance of these concepts?"

Sadly enough, he never responded to me on this particular point.

Friday, December 08, 2006

Economics 2.0

[Crossposted to the Ludwig von Mises Blog.]

Can the Future Do Without Economic Logic?

Flying cars and little green men aside, many science fiction writers have shown an uncanny ability to predict and "foresee" the future.[1]

Yet, for all their prophetic accomplishments surrounding the development of future technologies, many fail to grasp the economic laws — the catallactics — that have remained unchanged for thousands of years.

Here is a quotation to get our discussion off the ground:

"Capitalism doesn't have a lot to say about workers whose skills are obsolete, other than that they should invest wisely while they're earning and maybe retrain: but just knowing how to invest in Economics 2.0 is beyond an unaugmented human. You can't retrain as a seagull, can you, and it's quite as hard to retool for Economics 2.0." — Charles Stross, Accelerando

Hard science fiction author, Charles Stross published a novel last year entitled Accelerando that tackled the issue of "the Singularity" and its rippling effects throughout society.[2][3]

Initially taking place around 2010, the reader follows the lead character — Manfred Macx — a computer nerd turned globe trotter whose modus operandi is said to be altruism.[4] He bills himself as a venture altruist, building and seeding productive ideas in exchange for mere reputation points.[5]

Ever the second-hander intellectual mountebank, Stross manages to mangle a bevy of technical and economic gobbledygook and shoehorn it into an exponentially spiraling plotline.[6]

However, Stross for all his valiant efforts falls short of delivering a futurist economics that is not subject to the economic principles we know today.

Russia has been back under the thumb of the apparatchiks for fifteen years now, its brief flirtation with anarchocapitalism replaced by Brezhnevite dirigisme and Putinesque puritanism, and it's no surprise that the wall's crumbling — but it looks like they haven't learned anything from the current woes afflicting the United States. The neocommies still think in terms of dollars and paranoia. Manfred is so angry that he wants to make someone rich, just to thumb his nose at the would-be defector: See! You get ahead by giving! Get with the program! Only the generous survive! But the KGB won't get the message. He's dealt with old-time commie weak-AIs before, minds raised on Marxist dialectic and Austrian School economics: They're so thoroughly hypnotized by the short-term victory of global capitalism that they can't surf the new paradigm, look to the longer term.

While some self-professed Marxists have allegedly embraced Austrianism — and vice versa — one wonders exactly how to synthesize the Marxist Labor Theory of Value with its polar opposite subjective theory as enshrined by the Austrian School.[7][8] This fact is punctuated best by Das Capital, in which Marx embraces historical materialism as the de facto epistemology to explain how and why historical events occur, in part, through the now-classical bourgeois-versus-proletariat class struggle.

In direct contrast is the Austrian School's a priori science approach, called praxeology.[9] Its foundation was laid out by Ludwig von Mises's axiom of human action or purposeful behavior. Society is a product of the human urge to remove uneasiness and dissatisfaction as far as possible; it is not a product of social classes, political hierarchies, and various other synthetic structures.

The Calculation Debate 2.0

While introducing the decade of 2070 A.D., Accelerando's narrator notes:

The last great transglobal trade empire, run from the arcologies of Hong Kong, has collapsed along with capitalism, rendered obsolete by a bunch of superior deterministic resource allocation algorithms collectively known as Economics 2.0.

It is these algorithms that Manfred earlier sold to an Italian politician, as a means to objectively calculate prices in a command economy. The mechanics of such equations are never fully fleshed out, leaving the reader to wonder exactly how a third party can, in some manner, come to such a measure of the multitudinous subjective values and preferences that individuals intrinsically have towards goods and services.

These "superior resource allocation algorithms" have been conjectured among numerous economists over the past century as it has played a central role in the socialist calculation debate. And while political scientists and technocrats continually busy themselves with tweaking the economic "black box" with various inputs, they fail to grasp how prices arise.[10]

Unfortunately for Stross, the future holds no deus ex machina in store to rescue this storyline, because a finite set of supercomputers cannot encompass a problem set containing infinite sets of possibilities. In this respect, the idealized command economy is a mathematical impossibility.[11]

Misplaced Energies

At one point in the story Macx's French mistress broadcasts news that Macx is in town:

"Oh, and he's promised to invent three new paradigm shifts before breakfast every day, starting with a way to bring about the creation of Really Existing Communism by building a state central planning apparatus that interfaces perfectly with external market systems and somehow manages to algorithmically outperform the Monte Carlo free-for-all of market economics, solving the calculation problem. Just because he can, because hacking economics is fun, and he wants to hear the screams from the Chicago School."

In this passage Stross now makes the error of "solving" Mises's calculation problem with the band-aid solution of copying consumer goods prices from a market system and transplanting them into the command economy. The use of this technique only affirms Mises's position, and is hardly a novel solution considering that Soviet planners were regularly thumbing through Sears catalogs for their coefficients.[12]

But we can still make lemonade out of this sucker — in theory we would have no issue per se with the argument that a super[-human] intelligence could drive entrepreneurial activity, and make smarter choices than a mere human opportunity exploiter. This is where the present and future can possibly diverge: can a two-state computational engine ever approximate human intelligence?[13]

Bursting Bubbles

While discussing what to do with a guest in their spaceship, several characters meander off the deep end:

The orang-utan explains: "Economics 2.0 is more efficient than any human-designed resource allocation schema. Expect a market bubble and crash within twelve hours."

Stross is guilty here of the mainstream economic error of cum hoc ergo propter hoc, by attributing the phenomenon of the business cycle to the emergence of capital markets in the industrial revolution. Under such mistaken impressions, it would be then quite natural for him to assume that an immense acceleration of the market process would also speed up the rate of market boom and bust cycle, although never explaining how or why it occurred in the first place.

Contrary to the mainstream, the Austrian Business Cycle Theory posits that cycles are exogenous to the market, a creature wholly belonging to the governments manipulation of the money supply, which, by artificially lowering the rate of interest, misrepresents the general level of time preference and ultimately misleads entrepreneurs en masse into malinvestment of the capital stock in sub-marginal pursuits.[14]

In contrast to the tenets of the neo-classical error, the condition of a free market would tend toward the evenly rotating economy (ERE), although never achieving equilibrium, as the minor perturbations mirror the transient value preferences on the market.[15] Under such conditions, Stross is incorrect to think that ratcheting up the intelligence and computational speed of the market would have a bearing on the amplitude, rather than only the frequency of misallocation.

However a simpler question may be posed to Stross: if "Economics 2.0" is more efficient than human-based pricing and has perfected an all-encompassing algorithm that allocates resources with near-absolute precision, how can capital malinvestment ever occur?

What is a reputation worth, anyway?

One of the most intriguing concepts found in the novel is that of "reputation markets."[16] While Stross also does not deign to explain in detail how this concept would function, one can make some guesses, although none of the interpretations seem to add up to anything useful or novel.[17]

Apparently Stross imagines that reputations will supplant the usage of currency and markets in a post-scarcity world as one is lead to believe from passages such as the following:

His reputation is up two percent for no obvious reason today, he notices: Odd, that. When he pokes at it he discovers that everybody's reputation – everybody, that is, who has a publicly traded reputation – is up a bit. It's as if the distributed Internet reputation servers are feeling bullish about integrity. Maybe there's a global honesty bubble forming.

… She doesn't approve of Manfred's jetting around the world on free airline passes, making strangers rich, somehow never needing money. She can see his listing on the reputation servers, hovering about thirty points above IBM: All the metrics of integrity, effectiveness and goodwill value him above even that most fundamentalist of open-source computer companies.

While we can only guess at what Stross meant by reputation markets, there are only the two possibilities: either it is a commodity-backed market, or not.

The problem with the former scenario is two-fold. First, because we are supposedly dealing with a post-scarcity world, the concept of commodity-trading is absurd as would be the trading of air or ocean water in our present world. Goods that are in superabundance are not subject to the study of praxeology, and certainly not within the scope of catallactics.

It is clear, though, that the world that Stross has created cannot be a post-scarcity world, if one still has to exchange in order to acquire the use of goods and services. The exchange of a valued reputation sounds interesting, but is quite problematic as will be explained momentarily.

In the latter scenario, if we posit that reputation markets are not commodity-backed, (and ignoring for a moment his apparent confusion over what comprises a post-scarcity world), all Stross has managed to do is recreate the concept of money substitutes, with the nexus of reputation markets to facilitate the exchange of this currency.[18]

In both these scenarios then, the objective exchange value of this money or money substitute comes into question without the benefit of the regression theorem to explain its present monetary valuation by the economic actors.

There are other fundamental questions to be asked about a reputation-based currency, most notably, how are reputation monetary units quantified or graded, and who or what intelligence will determine that?[19]

One can make the case, however, that although "reputs" (the story's marketable reputation units) may presently hold no objective exchange value (as they are essentially mere data patterns stored on a server) they may still hold monetary value, if and only if they once held objective exchange value.[20][21]

As intriguing as the technological wizardry within the story may be, the plot is unfortunately riddled with economic misconceptions and non sequiturs.

Tim Swanson is a graduate student at Texas A&M University. Send him mail. See his archive. Isaac Bergman is a real-estate developer in New York City. Send him mail. Comment on the blog.


[1] For instance, from Arthur C. Clarke's imagination sprang the notion of placing communication satellites into geosynchronous orbit. And Gene Roddenberry was one of the first individuals to envisage an all-in-one handheld device, capable of measuring, communicating, and storing information.

[2] Accelerando can be viewed online for free at

[3] While somewhat tangential, Charles Stross operates a Wiki to further explore and explain many of the ideas discussed in Accelerando. Of particular interest is his critique of libertarianism, in which he simply links to Mike Huben's smorgasbord of pro-statist arguments.

[4] The nomadic and quasi-Bohemian lifestyle that Macx lives has been described as a "serial entrepreneur"; however it is arguably closer to the life and times of grey hat hackers such as Adrian Lamo. These individuals attempt to highlight security vulnerabilities at companies, while having a credo of operating for little or no personal gain. In the story, Macx's character conveniently is able to side-step these economic uncertainties through the generosity of third-parties (e.g., "a grateful multinational consumer protection group" paid for his hotel visits). Note: one argument surrounding individuals such as Lamo is that they are, in fact, attempting to gain publicity in order to market themselves for monetary contracts.

[5] This is reminiscent of the classical argument that all monetary systems should be scrapped and replaced with a system of credits for hours of labor, as determined by the rate of a person laboring for an hour with a shovel. Not only is this average unrealistic but it also ignores the dissimilar, heterogeneous abilities and productive levels each individual is capable of. See also "labor notes" and the Cincinnati Time Store. Reading "Harrison Bergeron" by Kurt Vonnegut may also be instructive.

[6] Apropos Peter Klein, while we enjoy an entertaining storyline, we can only suspend our disbelief so far.

[7] See also Heterodox economics and Heterodox traditions.

[8] The academic discourse comparing the LTV and STV is voluminous. For instance, see chapter 5 in "Epistemological Problems of Economics" by Ludwig von Mises. For a recent layman's explanation of the STV see "Artwork and the Subjective Theory of Value" by Yumi Kim.

[9] See, "Praxeology: The Methodology of Austrian Economics" by Murray N. Rothbard, "Praxeology and Understanding" by G.A. Selgin, and Human Action by Ludwig von Mises.

[10] Prices themselves are not fixed points along a line, but rather temporally subjective valuations of goods and services. For more discussion on this paradigm of "perfect information" and what a price "should be" see "Knowledge vs. Calculation" from Stephan Kinsella.

[11] See Robert P. Murphy's "Cantor's Diagonal Argument: An Extension to the Socialist Calculation Debate" in The Quarterly Journal of Austrian Economics, Summer 2006, 9(2), pp. 3-11 (available in PDF).

[12] For the Sear's connection see, here. See also Gennady Gerasimov's joke of sparing the markets of New Zealand.

[13] Regarding the centralization of knowledge and prices, see: "Socialism: A Property or Knowledge Problem?" by Hans-Hermann Hoppe and "Why a Socialist Economy is "Impossible"" by Joseph T. Salerno. See also "Knowledge vs. Calculation" from Stephan Kinsella.

[14] For more discussion on the ABCT see, The Austrian Theory of the Trade Cycle compiled by Richard M. Ebeling, Money, Bank Credit, And Economic Cycles by Jesús Huerta de Soto, and "Expectations and Austrian Cycle Theory" by Frank Shostak.

[15] For more on the ERE see, chapter 14 in Human Action by Ludwig von Mises, and the Study Guide to Man, Economy, and State from Robert P. Murphy.

[16] This criticism can also be leveled towards the Whuffie system used in "Down in Out in the Magic Kingdom" by Cory Doctrow.

[17] Rating, risk analysis and credit scoring companies exist today; based upon a plethora of metrics they will rate the value of companies, bonds, etc. However these "reputation" companies are providing a service good, not a currency. Incidentally, both Standard & Poor's and Moody's have been erroneously sued in the past for providing debt ratings of government solvency. Stock market's themselves are institutions that — when free of regulation — can also accurately reflect and rate the health of organizations.

[18] One seemingly extraneous example that illustrates the difference between the hypothesized reputation currency and a money or money substitute system is Frequent Flier miles. These miles can arguably be called money, since they have monetary exchange value in which people acquire and maintain "cash" balances for future consumption or exchange. In the case of frequent flyer miles, the miles are initially valued for their objective exchange value, because they represents a claim on a specific good: transportation via airplane. However the reputation currency has no such explanation of any historical objective use balance, and is unlikely, if not entirely impossible, to become valued for its monetary function. See, The Theory of Money and Credit by Ludwig von Mises.

[19] "Reputs" are to reputation scales what 'utils' are to cardinal value scales. Furthermore, how exactly do you cash in a few points of reputation? Are they redeemable for any material object? As long as the reputation system is an exchange system, it is subject to economic laws. And assuming that Stross's reputation system somehow solves the "decider" problem, a number of other issues remain unresolved. For instance, how many "points" can each person use throughout the day? Do you get to give someone a point for every time someone does something? Every 5 seconds? Once an hour? Can you remove your vote? Is a point for yawning weighted as much as shooting a bulls-eye in archery? Ad nauseam.

[20] This aggregation mystery belies subjective indices such as BCS football rankings, college rankings, and even GDP. "What is up with GDP," by Frank Shostak, articulates perhaps the clearest account of why the GDP framework is fallacious and misleading.

[21] Regarding the present valuation of money, Ludwig von Mises writes in The Theory of Money and Credit:

Before an economic good begins to function as money it must already possess exchange value based on some other cause than its monetary function. But money that already functions as such may remain valuable even when the original source of its exchange value has ceased to exist. Its value then is based entirely on its function as common medium of exchange.

NYC to Plunder an Extra $1.9B in 2007

The city was helped by record Wall Street profits and a strong market for commercial real estate.

Reality Decoded By: Iceberg
Published: November 29, 2006 - 2:26 pm

New York City will have a record surplus of $1.9 billion in fiscal 2007, helped by [the] record [pillaging of] Wall Street profits and a strong [boom] market for commercial real estate, according to a report released Wednesday by state thug Comptroller Alan Hevesi.

"New York City is reaping the benefits of a [successful raid upon a] growing economy and [un]sound management [despite the anti-market] decisions made by the mayor and City Council over the past five years," said Mr. Hevesi in his report, adding that the surplus will cut the city's projected budget gap to $510 million from $3.8 billion [making people wonder how $3.8B - $1.9B is equal to $510 million!]

Real article found here (subscribers only)

Thursday, December 07, 2006

Market Solutions

DECEMBER 06, 2006 -- New Brighton, Minnesota -- Spartan Protection Services, a Robbinsdale, Minn.-based property protection company, has instituted a dress code for residents of the Timbercrest Apartments, a 68-unit complex located here, in an effort to cut the number of calls the local police department receives regarding gang-related crime at the distressed property. Link to full article

The market may originate some weird ideas, but if this works expect to see it happen elsewhere.

And of course if this does work, some intrusive busybody will criminalize this form of discrimination.

Tuesday, December 05, 2006

the pen is mightier than the reality

To those within the halls of government power and her intellectual whores within the state-subsidized ivory towers, I hereby beseech your help in removing the difficulties that make life nasty, brutish, short, and generally uneasy.

Just like by the stroke of pen you create wealth, affordable homes, good paying jobs, eliminate poverty and hunger, et. al., I humbly request that you grant us some relatively easier boons.

First, as you may already know, NYC has a serious vermin problem. Please, if you would only pick up your quill and draft a law to ban all forms of vermin within city limits all our problems would go away by fiat, and they wouldn't dare disobey your holy writ.

Also, so many people die from cancers and vascular ailments- can't you ban those horrible illnesses too? It would be so much simpler than just banning the use of trans-fats as NYC just has, and would resolve our health problems immediately. If we just ban obesity, we will witness a transformation as suddenly our cities will feel roomier than before, the train less crowded, the streets easier to navigate, and everyone will trade in their cavernous SUV for some smaller hybrid car.

While you're at it, can you just ban all death, you know, like declare a moratorium on all forms of dying, which we all know does serious economic harm, tears families apart in bitter inheritance lawsuits, and is the greatest cause of involuntary widowhood. This will also greatly help raise the general living standards because people will no longer invest in life or health insurance and would be able to put that money to better, higher uses.

Why stop there? Let's ban divorces, which tie up our family court resources with puerile "he said, she said" controversy. If we ban childish bad behavior, our schools will be able to do their jobs and teach our children properly. We might enact a similar law which will make our students smarter by making it a crime to get anything less than an A+ on a test.

Let's join together to ban Co2-spewing volcanoes so we can end the rapid climate change that threatens to wreck our planet and drown our cities. At the same time, we should ban the ocean from tidal waves, and the winds from blowing devastating hurricanes, monsoons, and tornadoes.

I know that it seems might a lot to ask, but if all it costs is some ink and paper, couldn't you just conjure those up too?

Tuesday, November 28, 2006

fractional musings

Here is a question I pose to the more accountant-minded individuals out there-- does the policy of fractional reserve subsidize bank promotions? For example, if a bank offers you $100 to open a checking account with them, is this promotion somehow subsidized by the fact that your $100 promotional gift redeposited into the new account is worth another $900 to the bank in loanable funds?

My first question is then, why does the bank need to give the money to the customer in the first place, instead of "depositing" it themselves, and reaping the full benefit. Then again, I'm not an accountant, nor a banker, so I don't know if these funds are coming from bank profits or from another depositors account, and if from the latter, I would think would just be a wash as far as the total loanable funds and gain the bank perhaps nothing besides another customer.

Can someone help me shed some light on this question?

Sunday, November 26, 2006

styrofoam houses

Back in April, I blogged about the false assertion of market failure.

Monday, April 17, 2006

the free market fails to fail

One often hears of the term "market failure" as an excuse for unbridled statist aggression to rob, plunder and steal from her slaves unwilling servant class. It might be used to justify environmental policy; to fund canal digging; bridge, road, and railroad building; etc.

Alas, "there is no such thing as market failure - only lack of private property rights." Hence, externalities are the creature of the mixed markets, those in which government has preempted the common law of liability, with its own ineffective policies, in which some cases is a form of corporate welfare (logging industry, fishing rights, etc.)

Without delving further into the economics though, I'd like to state that such a claim is prima facie fallacious because the very notion that there exists an objective definition of what services and goods that billions of interacting individuals ought to offer one another is preposterous. If that weren't true, I humbly submit that there is a market failure to deliver styrofoam houses, bicycles made from gold, and teleportation machines.

Thus said, there is no market failure because one cannot argue that such goods or services ought to be provided by the market, only that they, strictly on a personal basis desire the provision to be made.
I thought it worthwhile to bring up again, because to my surprise I have learned that builders have found it economical to construct homes with styrofoam blocks, and poof! - there goes one ridiculous example of market failure!

More recently though, I came across Prof. Hans-Hermann Hoppe's analysis of public vs. private goods in which he thoroughly ridicules the conceptual distinction.

For one thing, to come to the conclusion that the state has to provide public goods that otherwise would not be produced, one must smuggle a norm into one’s chain of reasoning. Otherwise, from the statement that be cause of some special characteristics of theirs certain goods would not be produced, one could never reach the conclusion that these goods should be produced. But with a norm required to justify their conclusion, the public goods theorists clearly have left the bounds of economics as a positive, wertfrei science. Instead they have transgressed into the field of morals or ethics, and hence one would expect to be offered a theory of ethics as a cognitive discipline in order for them to legitimately do what they are doing and to justifiably derive the conclusion that they actually derive. But it can hardly be stressed enough that nowhere in the public goods theory literature can there be found anything that even faintly resembles such a cognitive theory of ethics. Thus it must be stated at the outset, that the public goods theorists are misusing whatever prestige they might have as positive economists for pronouncements on matters on which, as their own writings indicate, they have no authority whatsoever. Perhaps, though, they have stumbled on something correct by accident, without supporting it with an elaborate moral theory? It becomes apparent that nothing could be further from the truth as soon as one explicitly formulates the norm that would be needed to arrive at the above-mentioned conclusion about the state’s having to assist in the provision of public goods. The norm required to reach the above conclusion is this: whenever it can somehow be proven that the production of a particular good or service has a positive effect on someone but would not be produced at all, or would not be produced in a definite quantity or quality unless others participated in its financing, then the use of aggressive violence against these persons is allowed, either directly or indirectly with the help of the state, and these persons may be forced to share in the necessary financial burden. It does not need much comment to show that chaos would result from implementing this rule, as it amounts to saying that everyone can aggress against everyone else whenever he feels like it.

Sunday, November 19, 2006

how (not) to end war

Skip M. Oliva reckons that N.Y. Rep. Charles Rangel is trying to enslave American youth under the pretense of helping avoid war, with Rangel's recent bill to reintroduce a national service draft that will indiscriminately target youth of all stripes and persuasions. Per Rangel's tortured logic, politicians would think twice before declaring war since their own relatives will be at risk of conscription.

Skip offers some evidence for his suspicion of Rangel's ulterior motive:
[Rangel] said having a draft would not necessarily mean everyone called to duty would have to serve. Instead, "young people (would) commit themselves to a couple of years in service to this great republic, whether it's our seaports, our airports, in schools, in hospitals," with a promise of educational benefits at the end of service.
Where Señor Oliva doesn't actually finish the complete analysis of Rangel's national enslavement bill, I will.

A. The bill won't accomplish what it is set to; in this case to end the drive for war, since the "national service" draft contains such a broad category of possibilities, giving politicians the peace of mind they need to kill other people's children when their own loved one's will be strategically positioned somewhere in the relative safety of National Guard duties :cough: Bush :cough: or some cushy desk job at the National Propaganda Agency.

B. As a few Mises commenters point out, you don't fight the war machine by enabling easier access to unwilling labor assets.

C. As Tarran brilliantly writes there--

If you want to give pause to those who wish to start unpopular wars, the answer is not to force people into the military, but to allow those already in the military to leave more easily!

After all, if my employer orders me to go to my competitors offices and break their legs as they come in for work, I don't have to do it, I can say "cheerio" and quit. Soldiers aren't given that option (in fact they are threatened with death for attempting to quit).

Let's give them that option. I think something like changing the rules so that any soldier can quit, anytime, and they get evacuated after the wounded (if the exigencies of the fighting permit), are transferred to the U.S, and honourably discharged.

Thus, every soldier who risks his or her life would not be doing it because they feel they have no choice, but because they feel the risk is worth it. It would blunt the U.S. government's abilities to conduct offensive operations, but would enhance the U.S. government's ability to conduct defensive operations (should the warlike Canadians ever decide invade us).

Thus we can safely concur with Señor Oliva and conclude that congresscritter Rangel is not looking to end war, but rather sneak involuntary servitude over the great, brainwashed hoi polloi.

Friday, November 17, 2006

RIP Milton Friedman

Of the thirty or so articles I've parsed so far, the most lingering and salient point I've gleaned from Milton's life-long (sometimes inconsistent) struggle for individual freedom, is this:
"In the 1970s, he was a leading advocate for the abolition of the military draft. At one hearing, Friedman became annoyed with a general who likened those in an all-volunteer military to ``mercenaries.'' Friedman told the general that if he insisted on using that term, he would liken draftees to ``slaves.'' The general made a rhetorical retreat."

With his razor-sharp wits at his beck and heed, Milton was certainly nobody's monkey.

Monday, November 13, 2006

frist [born] post

It is with great pride and pleasure that I announce to all the finest denizens of the interwebs the birth of my first child, a son.

A special shout-out of gratitude goes out to BK Marcus for all his [unsolicited] advice which is greatly appreciated, as well as the cute baby gifts he sent us.

Tuesday, October 17, 2006

perspective matters

After reading Ken MacLeod's latest book, Learning the World, I found it that it's not exactly what I'd consider a page-turner. However I can relate that his novel took a fresh approach to the old "humans make alien contact" storyline, by presenting it mostly from the POV of the non-homo sapiens.

What makes this book interesting is that MacLeod switches the usual positions of the "us and them", in that the aliens of the novel are us humans, while the aliens being visited are referred to as the humans.

By reversing the positions, MacLeod's story cleverly presents the homo-sapien intergalactic travelers as aliens to the readers, which is made all the more-so believable because their behavior and culture is seen as strange, so distant, and alien to us.

The society of the non-homo sapiens on the other hand, aside from their physical differences, can be easily related to by the reader, because their society is rife with war, slavery, government tyranny, etc. In that sense, the reader is being presented with a subtle slap in the face, perhaps awakening him to see that the values and ideas that most people today consider the virtue of civilization are in fact quite barbaric and uncivilized.

Friday, October 06, 2006

bruce lemmon

In what must be flattery, who would you guess served as inspiration to actor Jim Carrey's manic character roles?

Now call me crazy, but I'm willing to bet it was Jack Lemmon after recently watching The Apartment. Also starring Shirley MacLaine as Fran the elevator woman, it's about the life of a lowly actuary named C.C. Baxter, played by Lemmon, who is constantly cajoled into lending the use of his apartment to his higher-ups in the company because he can't turn them down.

At first I found it eerie in how similar his body language was to that of Jim Carrey, but I was blown away when he uttered to Fran "That's the way the cookie crumbles" (the trademark phrase have you, from Bruce Almightly starring none other than Jim Carrey.) If that wasn't enough, Fran later says "I guess that's the way it crumbles, cookie-wise".

I guess it could all just be some screenwriters joke on ol' Jim though, but I'd like to think that he was in on the laugh. Come to think about it, they even look alike as evidenced in the picture below.

bar none

In response to the constant complain of late-night noise and rowdy drunks, the NY State Liquor Authority, which oversees the issue of liquor licenses has declared a heavy-handed moratorium against the issue of new licenses to any establishment located within a 500 foot vicinity of any other watering hole. This surprise edict has even affected longtime operators who amidst a relocation have found they can no longer serve alcoholic beverages at their new joint.

While this policy will certain bring financial ruin to many an unfortunate business owner, it is hoped that use of this back-door tool of withholding licenses will help the government solve the noise problems and other neighborhood disturbances caused by late-night revelers making their woozy way home at 2 AM.

I'd like to commend and quote an excellent comment made by an astute individual on a Gothamist post on this topic:
It's the noise and riff-raff that's a problem, not the bars or the booze they serve. Young fools pack into these bars like sardines, and cutting the number of liquor licenses is only going to make the existing places even MORE unbearable than they already are. And they are pretty freaking unbearable already.
Welcome my friend to the world of wacky intervention.

Wednesday, October 04, 2006

paper shackles

Is a contract anything more than the mere semblence of colored atoms contrasted against the surface of another medium, designed in a fashion in which it contains arranged patterns recognizable to humans as the expression of inscrutable thought elements?

If that is so, can we still posit existant duties and enforcability consistent with libertarian application of justice for contracts, whether penned or merely verbally expressed?

I like to think that a contract derives it economic power from the market process, and not from the terms of enforcability and that this would be likewise true of the bonding companies which would serve to protect a system of free contracting.

An individual or firm who failed to meet their contractual duties and/or the bonding company which failed to remunerate the damaged parties would be quickly put out of business.

This is not to say that there could be no foundational ethic to support the rights and enforcabilty measures, but rather one should not have to posit the existence of contractual rights in order to uphold the ideal of free contracting.

Overall I'd like to think that the libertarian justice system can sleep securely, while the benign king of "good will" reigns as the final arbiter over civilzed society.

weapons of mass disillusion

I adore Borat. This HBO comedian should be considered an anarchist hero, even though he probably is not what you and I would call an anarchist. The reason why I nominate him to the hero status is because of the great work he has done to blasphemously pierce the veil of sanctity attached to the state.

I reckon that the reason why he has been more successful in this regard than most others is due to the nature of government; wherein the basis of its power is ultimately derived from public opinion.

Comedy, it seems is a most potent agitant to be used against the state, and when wielded properly can exert more wide-spread influence than a brilliant dissertation on the philosophical foundations for liberty or the ethics of a market economy.

I suspect this would also explain the popularity of Comedy Central's Jon Stewart, who although I imagine is also statist to the core, still manages to disaffect the masses from their illusioned sanctity of government with the potent WMD of comedy.

Tuesday, October 03, 2006


Just recently I had the privilege to attend a 100th anniversary party held for an apartment building that was constructed by architect Charles A. Platt in the year 1905-1906. Ten of the current residents in this tony building opened their homes to exclusive viewings restricted to the snooty geegawers on the guest list (which admittedly I cannot be found, but my associate who brought me there was.)

After quietly hobnobbing with the stuffy elites -- okay, I think I made my point-- we made quick exit back to real life.

My associate, a fellow statist with an extensive real estate development background was quite astounded at the short timeline in which this building was erected.

From what little I know of New York City history, there was no buildings department back in 1905. There was relatively no zoning codes, no landmarks commission, and generally little government oversight into real estate development. The only regulation I can think of that this building was subject to was a height restriction, as laid down in the "New York Tenement Law" which stated that buildings could not be built higher than 1.5 times the street width. With that one condition, the architect/developer designed an amazing 11-story building which till today is quite unmatched in certain respects.

My associate, although he has yet to shed his statist-informed illusions, is one who was never shy to flirt with the given rules of the officialdom. His business decisions are mostly informed by what he thinks he can get away with, rather than what will be readily praised by the most straight-laced bureaucrat who could care less about your timeframe or budget expenses.

After quickly summing up all the things that slow down our current projects, be it dealing with OSHA, the NYC Building Department, the Landmarks Commission, the Mayors Office (for the issue of getting waivers on ADA compliance not feasible in a landmarked structure which is mostly untouchable to its legal owner), it is no surprise that although our generation is far ahead in terms of technology and construction techniques, we are far behind in terms of where we could have been if the overall regulatory environment had not reared its ugly head over the past century.

Slightly-related fun fact of the day: Kennedy is old Gaelic for "ugly head".

Per the NYC Department of Buildings:
"In 1860, after a tenement fire took 20 lives, New York City's building laws were extensively revised and strengthened. At that time, the position of "Superintendent of Buildings" was created within the Fire Department to enforce the new structural safety laws. An independent "Buildings Department" in Manhattan was later founded in 1892. Each Borough President's office had an autonomous Superintendent of Buildings until 1936, when a citywide Department of Buildings was created."

In any case, the avalanche-ish erosion of private property rights could be said to have begun with the Zoning act of 1926, in which the city got the idea that they have the right to dictate property usage types, dimensional and bulk restrictions, and the construction configuration requirements. While it was more lax in the early years, over the century it has started to resemble the old dictum "everything not prohibited is compulsory and everything not compulsory is prohibited."

The Landmark Commission was created in the 70's which marks the begining of statists interfering in purely aesthethic planning. From this point forward, we can expect to see a new government agency, the sole purpose of which will be to render decisions of property aesthethics for non-landmarked neighborhoods or properties, perhaps to enforce the color you will be able to paint your home, regulating the species and allowable dimensions for your landscaping elements, what style of bathroom fixtures are permissible, and if we are very lucky, even the type of screws you will use to build said home.

Lest you think I'm exagerrating, I can assure you that there are many stato-masochists who are already clammering for a "Buildings Design Authority" to be established, and one may proceed to and search the forums for many such fine examples.

Monday, September 25, 2006


I was coming out of the F train on the NW corner of 63rd St, when I heard, rather than saw the accident occur. I then heard someone excitedly yell "He's stabbing him!!" and I looked over as the perp exited his vehicle from the passenger side, and brandishing a knife, starting chasing the cop who was approaching the car door.

Seconds later I see mace spray arcing wildly in the air as the cops retreat from the knife-wielding thug, and a moment later, I hear three gunshots ring out.

The crowd which moments before was gathered around at the corner dispered suddenly, some of them ducking to the ground, most of them running up the block.

And 20 seconds after it all began, there were people who began crying in the street, hugging fellow strangers for moral support.

I'm forever changed.

-1010 WINS

Wednesday, September 20, 2006

the money quote

I have perhaps read a fraction of Ludwig von Mises's effusive output, but I have already corrected myself of the initial misconception that Mises wrote punctilious yet boringly dry economic texts. To witness;
"Superficial critics of the capitalistic economic system are in the habit of directing their attacks principally against money... and yet they want this exchange to be achieved without any medium, or at least without a common medium, or money. They obviously regard the use of money as harmful and hope to overcome all social evils by eliminating it...

All the processes of our economic life appear in a monetary guise; and those who do not see beneath the surface of things are only aware of monetary phenomena and remain unconscious of deeper relationships. Money is regarded as the cause of theft and murder, of deception and betrayal. Money is blamed when the prostitute sells her body and when the bribed judge perverts the law. It is money against which the moralist declaims when he wishes to oppose excessive materialism. Significantly enough avarice is called the love of money; and all evil is attributed to it.

The confused and vague nature of such notions as these is obvious. It is not so clear whether it is thought that a return to direct exchange by itself will be able to overcome all the disadvantages of the use of money, or whether it is thought that other reforms will be necessary as well. The world makers and world improvers responsible for these notions feel no obligation to follow up their ideas inexorably to their final consequences. They prefer to call a halt at the point where the difficulties of the problem are just beginning. And this, incidentally, accounts for the longevity of their doctrines; so long as they remain nebulous, they offer nothing for criticism to seize upon."

--The Theory of Money and Credit, Chapter 6

L. v. Mises, Godfather of the Austrian Mafia

Sunday, September 17, 2006

the language coil

I've often found that peoples unknowingly hold thoughts and beliefs which they are bound to by the words and concepts they have used all their life, but pay no more than cursory attention to their meanings. Surely there is a good reason for the usage, as abstractions serve a purpose of both mental and verbal shortcuts, allowing us to quickly express complex thoughts without having to resort to reinventing the wheel every time we need to have a flat tire fixed.

Therein lies the danger-- the assumption that people automatically understands the full meaning of the abstraction, and are not mislead to take the abstraction as a significant term other than the sum of its parts.

One quick example that can demonstrate this point; the use of the words "natural" and "unnatural" used other than to discern between occurrences that come about on their own in accord with the law of nature, and occurrences that come about through the intervention of some higher being, such as man or a supernatural being.

As Vache Folle points out,
"I have known folks who claim that their hatred of homosexuality stems from reason. In support of this, they claim that it is “unnatural”. Since it occurs in nature with some considerable frequency, I dispute this characterization. It is true that homosexuality does not lead to reproduction, but neither does celibacy, and I don’t know anyone who condemns celibacy. Ultimately, this moral reasoning depends on the metaphysical assumptions that “natural” is good and that reproduction is always desirable."
Please note how the construct of the abstractive terms "natural" or "unnatural" cast not any moral and ethical judgments such as right and wrong, or good and bad. The association of natural and good, and vice versa is a wholly inappropriate exercise, and ought be corrected where ever visited.

Similarly, I have friends who refuse to use microwave ovens, or artificial sweeteners, and I wholly understand this position being that these health-conscious individuals are always looking out for the next bogeyman, in this case the scary terms "radiation" and "artificial" or "synthetic".

It never fails to amaze me how grown, reasoning people can get frightened from the term radiation. After all, every moment of our existence, from start to end is bathed in, and emits radiation. There is the heat radiation our body's give off, the radiation we bask in from the radiator, the sun's light radiation we attune our brains to see with, the infrared our convection ovens cook with, and the TV, radio and cosmic rays that endlessly bombard us, or pass through us without regard to our atomic density.

But set an unnatural magnetron to emit alternating electric currents at 2.450 GHz, fully and benignly enveloped in a Faraday cage, and see how people run to hide to the accustomed and relative safety of Prometheus's fire (which by the way radiates in the infrared range).

I fail to understand why this particular form of radiation is feared more so than other forms, but I'm willing to put myself out there and dare blame it on the abstraction of "radiation". I can also assure you that it's a waste of perfectly good oxygen to try to talk sense into a microphobic by telling him that because the size of the perforations in the mesh is much less than the wavelength of 12 cm, the microwave radiation cannot pass through the door, while visible light (with a much shorter wavelength) can. In this case the abstraction must be clearly defined and explained to break through the paranoia.

In regards to sweeteners of all origins, I have found the aversion to synthetic chemicals to be ill-informed and non-reasoned. First, what is a sweetener? Obviously a sweetener is some chemical formation that interacts with your taste buds in a way that your mind might find enjoyable and pleasing. For a long time, sugars found abundantly in nature have provided that stimulation, with much resulting havoc to the health of those whom have over-consumed.

With the introduction of man-made sweeteners, luddites have found yet another non-sensical distinction to hound to no end. They suddenly become paternalistic scientists, positing such brilliant and hard-hitting questions such as "How do you know it won't give you cancer?" (I often fear that the loathing people have for synthetic sweeteners derives from their gloomy sense of universal justice, as though it cannot be that something tasting so good can dare exist without having a significant unnutritional repercussions.) My usual answer to this nonsense is to ask them how they know the fruit, vegetables, or whatnot that they consume will not give them cancer.

The abstracted assumption I am asked to believe is that a chemical formation which is not found in nature, must automatically be harmful to, and was never meant to be assimilated by the human body. The term that does the brain damage in this case is "artificial"- equated by the luddites to mean "fake", and jeez, fake things must be bad for you. The person who doesn't get caught up with these meaningless distinctions though would be prudent to monitor the effects of, both short and long term, for all types of foods, not just those of unnatural origin.

Frankly I can go on about the knee-jerk aversion to genetically-modified foods, but I think the patient reader has already grasped my point.

Changing Gears

Some while ago, there was heated discussion over the viability of corporations in a free market. The furor started over Piet-Hein Van Eeghen's corporation-scathing JLS article titled "The Clash With Classical Liberal Values and the Negative Consequences for Capitalist Practice".

To summarize, Van Eeghen's arguments boiled down to a few critiques of the injustices of corporations such as: corporations historically relied on a state to give it entity status, they separate control from responsibility (limited liability), they exist independent of human life, and can well exceed it, and are hence essentially state-like in their nature.

To a LeftLibertarian, sometimes the luster of this poison apple has them to cast aside their better judgment as they eagerly denounce all forms of corporations. The problem of course is their inability to overlook the historical, and abstractional association of the term.

Shrugging aside the baggage of positive law, the function of a corporation is a useful abstraction to a free society. For one, it makes a wonderful vehicle to expedite the accumulation of savings necessary to allow production to reach higher, more roundabout stages, which result in prosperity. It also allows those with pressing time constraints to delegate the task of working their otherwise non-productive capital.

The much ballyhooed illegitimacy of the corporations' entity status is as wholly irrelevant, as is the historical fact that corporations were state-granted abstractions. I fail to understand why that should have any bearing on a group of freemen consentually hallucinating the imaginary entity for the unified purpose of filling some productive desire.

Furthermore as I wrote there in separate posts;
"Entity, or personhood is just an abstraction; a convenient mental construct. Let not the statist baggage cloud the free market variety which could accomplish the same function. The real owners are, and have always been the shareholders"...

"As an addendum, I want to point out that the immortality question isn't an issue once we recognize the shareholders (and to whomever they sell or bequest their property) as the real owners."

"I don't know why you insist on conflating state capitalism's form of corporation, and it's convenient legal fictions, with a free market version which is based on libertarian principles, in which the only recognized form of ownership is clearly vested in the shareholders, and not some fictitious entity.

A corporation under libertarian law would be recognized as a relationship where persons are under the acting orders of the ownership to steward some property, and under which any tort liability would have to be aimed strictly at the parties involved in causing the damages.

Mere ownership of the property does not necessarily include the owner as part of the cause-- to accept otherwise would be a knee-jerk response by someone who only recognizes the whole package deal of state-capitalism's corporatism"...

"I have no disagreement here, other than I would think that under anarchy people would be free to form voluntary arrangements, for example to live communally under socialist principles.

Such society would allow people to suffer the illusion of having a distinct personhood for fictional entities, something that some might say we have that today with the concept of god as expressed by religion.

Of course such illusions will be strictly subjective to that group, and any other individual or group dealing with the corporation would deal with it's owners or management under the libertarian condition of determining causation."

What Else?

I imagine that there are hundreds of abstractions that most people hardly think twice about-- the nonsensical basis for intellectual property laws for example. The point I make is only that one should maintain constant guard against accepting the package deal of an unstudied abstraction.

Monday, August 28, 2006

when logic need not apply

Some people just don't get it-- and this is not just anyone, it's a blog written by one of the most respected property appraisers in New York City, who you would think would know, well you know, about property values, and the formation of prices in general.

According to his foolish naïveté, it's the housing boom that drives the middle class out of the city, not misguided market intervention (which is a truely understandable conclusion for an empiracist who illogically correlates a boom in the housing supply with the exodus of middle class workers and deduces that an increased supply of a good = higher prices).

Go figure.

Below are the comments I left this wunderkind.
"This is one of the byproducts of the housing boom and revitalization of urban areas."

That dog won't hunt.

This is a direct product of people naively believing in the Central Planning Fairy.

The main reason why middle class incomed people are being priced out of the cities is tri-fold:

The primary problem is the irrational belief in the goodness of centrally planned zoning; that which dictates the density, dimensional proportion, usage type, etc. allowed. Of course planners are only human, so they cannot fully forsee all the long-ranging effects of their economic devestation and class-polarity housing policies.

The act of zoning is the grand pretense that experts have the right and privilege to tell you what is good for you, Citizen Joe, as though Joe would not have common sense enough to not live in unlivable living conditions.

It thus serves to stifle development of all kind, leaving unmet demand at all price levels, but most especially the middle and lower price ranges.

Think about it, because it's purely logical. If you restrict availablity of any given product, the price will rise as people will bid up prices. Those who cannot afford to bid higher must seek alternatives. Those alternatives include finding housing in less desired areas, and maybe even out of state.

Essentially, zoning thus serves to raise the price of housing by restricting competition. When private organizations engage in this activity, it is known as cartelization and angrily condemned. But when pretensious city planners do it, they are met with celebration as anybody can attest about the shameful participation and agitation by groups such as ACORN or the GVHPS.

Secondarily, the white collar workers are the direct victims of the price war, as they cannot bid away the same quality housing as the rich, and they must live in inferior housing, less choice neighborhoods, etc.

But tertiary, and most insultingly, the white collar workers are the ones subsidizing the lower classes, who thru the mechanizations of the city and state (such as Section 8, HUD, and rent control/stabilization, and IMD regulations*), end up bidding away the housing with the middle classes' money!

So in the end, the white collar worker are the rat which gets chopped from both ends-- the rich can afford the higher prices (and might even prefer the exclusivity the housing shortage provides), and the lower class uses the middle classes redistributed money to buy up the lower end product. It's no wonder the middle class are "fleeing", as they are not in any politicians grace to not be plundered.

The definition of insanity is to continue to act in a manner which is detrimental to your well being, because only the insane repeat the same actions and expect different and better results each time around.

Alternativly, we can pull our heads out of the sand and abandon these puerile fantasies of "smart", managed growth, and leave it to the wisdom of the common individual to decide how tall is too tall, how dense is too dense, etc.

* This was introduced into the blog post for the sake of clarity and does not appear in the original comment.

swait and bitch

In an article deceptively titled "The Worker's Rights Manifesto" (via, KAZ lays out a libertarian approach to protecting the proletariat class interests.
You and I, as a workers, have certain rights which are naturally ours, and which nobody should be allowed to take away from us. These rights are choices we are free to make, unless the powerful decide to steal them from us.
  1. The right to work for the amount we choose.

    What we earn should be a matter between ourselves and our employers, not something controlled or approved by some government, union boss, or other busy-body.
  2. The right to work for whom we choose.

    Where we work should be a matter of which job offer we accept, not controlled by some law or union rule saying that we are the wrong race, or sex, or what someone with our amount of experience is allowed to do.
  3. The right to keep the product of our labor, and do with it as we choose.

    The product of our labour is the amount we agree to sell our services to an employer for. It is ours by right, and any authority who takes it from us for their own purposes is wrong, be it taxes or union dues. Having earned it, we have a right to keep it even if we change its form, by buying something with it or willing it to our heirs.
  4. The right to decide how we work.

    What if we don't want three weeks off, but would like a little extra pay, instead? What if we want to buy health insurance with a huge deductible for two hundred bucks a year, instead of paying two hundred bucks per month for full insurance, because we have a lot saved up in the bank in case I get sick? Nobody should be able to bully us, with tax "incentives", regulations, or collective bargaining contracts, into taking a generic benefits package that has stuff we don't need, instead of the money or benefits I would prefer.
  5. The right to work the way we choose.

    We have a right to decide what is "safe", for ourselves, instead of being locked into some instantly-outdated and rigid "standard". We likewise have the right to decide what way to do things, and again not be shackled by red tape and rules invented by some bureaucracy.
  6. The right to become owners / management, and be proud of it.

    If we work hard, and make the sacrifice of saving our rightful income (product of labor), or work in our own time to create a great new idea, we have a right to invest it to create new wealth, becoming an owner, and not be punished for it, or looked down upon as something other than a worker.

Thursday, August 24, 2006

suprise suprise

"More tellingly, it provides a case study in what happens when competitive forces are unleashed and markets are allowed to operate more freely. And while some drivers are worse off, the vast majority of consumers have gained from the changes... Insurance regulators say more than 75 percent of New Jersey’s drivers are now paying less for auto insurance and that further reductions are expected...

Since the mid-70’s, auto insurance prices in New Jersey had been higher than anywhere else in the country. But even so, insurers contended that they could not turn a profit.

Trying to keep insurance affordable and available, officials layered on regulations. With competition limited, lower-cost insurers simply avoided the state.
No, that's not from a daily article on the Mises blog; would you believe it's actually in the NY Times? (and it's not written by John Tierney)

This good news comes after years of stifling regulation designed to "save" the lowly consumer from the depradations of the auto insurance industry.

Here is another interesting quote:
"As voters complained to lawmakers, regulators made it more difficult for insurers to raise rates. One consequence was that in good years insurers held off from requesting lower rates for fear that when their fortunes turned, they would not be permitted to reverse the process."
Which goes to demonstrate a number of things:

1) The ballot method is vastly inferior to the market process, where each dollar is the consumers' vote to reward the efficient producers and penalize the less efficient ones. This insurance issue has been around from before I was even a remote assembalance of atoms. The market on the other hand has delivered an equitable solution in less than one year's time.

2) The political solution almost always leads to an even less efficient situation whilst decreasing the choices and freedoms of individuals and increasing the power of regulators.

3) That individuals whose freedoms are constrained are bound to act in the manner of erring on the side of caution, leading to even greater inefficiencies. For example, NJ gas stations are allowed by law only one price change per day (once per week if located on the highways), and will thus tend to pricing their gas higher than the expected replacement cost, rather than take the risk of offering an unmutable lower price and not being able to afford the next delivery. Had the state not interfered, they would intially price their gas at what they believe will be sufficient to cover replacement costs, and upon better information, they will raise or lower their prices accordingly.

4) The regulatory hell had pretty much cartelized the industry to a select few players -- exactly two, if I remember correctly.

The next quote makes me think of the nationalised Canadian healthcare system:
"At the same time, because the rates were capped and insurers were required to provide coverage to all but the most horrendous drivers, the companies said they were often selling insurance at less than their estimated costs. The more coverage they sold, the insurers contended, the more money they lost. So they tried to keep good old customers, but avoided new ones. They often let their phones ring off the hook."
I do think there are more things we can do to even help the consumer even more;
-Privatize the roads (and truely privatize them!)
-Eliminate the regulatory requirement for driver's liabilty insurance

The insurance mandate gives the insurance industry some leverage over the consumer, because after all if you would like to drive a car on public roads, you are required to have insurance. Contrast that to an environment where the decision to purchase auto insurance stems solely from the individuals desire to decrease personal monetary risk, and not because you are forced to fork over for it. The insurance bagman is rendered harmless when there is no highwayman pointing his gun at you for your "protection".

In closing, I don't know if private road owners are likely to mandate auto insurance coverage, but I'm fairly certain that under government-owned road conditions and maybe in the hypothetical privatized-roads case, auto insurance rates would be even lower, and might even be priced into the road access charge.

Sunday, August 20, 2006

de facto criminality

The NYPD has proposed new rules for those who desire peaceful assembly, as per the right enumerated in the holy writ of the constitutional scriptures.
-Any group of two or more cyclists or pedestrians traveling down a public street, who violate any traffic law, rule or regulation can be arrested for parading without a permit.
- Any group of 20 or more cyclists must obtain a permit and approved route from the NYPD or would be subject to arrest
- Every group of 35 of more pedestrians must obtain a permit and approved route from the NYPD or would be subject to arrest
Which reminds me of one Ayn Rand quip:
"There's no way to rule innocent men. The only power government has is the power to crack down on criminals. When there aren't enough criminals, one makes them. One declares so many things to be a crime that it becomes impossible for men to live without breaking laws."

Friday, August 18, 2006

supply and demand

Kevin Carson of the Mutualist blog writes [first item]:
"The only solution to income polarization... is more income polarization. The main effect of subsidized college education was to dumb down college education to the previous level of high school education, while making a batchelor's degree obligatory for jobs that previously required a high school diploma. If graduate education is similarly subsidized, we'll see grad schools eagerly dumbing down standards to attract the money, and pretty soon everybody in America will have to have an M.A. to do any job that pays better than dishwasher. Subsidized higher education has simply made technical manpower cheaper to business, and encouraged it to adopt capital-intensive, skill-intensive production models that create technological unemployment for the uneducated. Given that subsidized education is one of the main reasons for the two-tier economy, advocating even more subsidized education in the belief that it will reduce income disparity is rather, well, shitheaded."

Sounds reasonable -- subsidizing and thus increasing the supply of overeducated workers will effectively drive the demand for those goods higher than it would be otherwise.

It's the next part I don't get; ceteris paribus, the increase of degreed professionals will drop the price for this sort of labor, thus flattening income disparity as the marginal value of professional accreditation is lowered. Wouldn't that mean that white collar labor ought to expect to see their labor rates lowering to approach those in the blue collar sector?

Thursday, August 10, 2006

aborting the offspring of a violated gaia

I'd like to praise those who favor unmitigated abortion, and the coerced conservation of natural resources for their intellectual consistency.

For if one believes that society has a duty to preserve the natural resources of the earth so that we can ensure the future sustainability of human society, they must also want to reduce the total amount of possible future users. The fact that they are pro-violence when it comes to conservation should mean they have nothing to balk at when it comes to fetal extirpation. It is indeed praiseworthy of them to then refuse to have children who would further be burden upon and consume these precious resources.

The argument for coercive conservation lies on the premise that there is an existent duty of justice, which requires that all society members leave over enough resources to all unborn, potential offspring. If suppose they base this premise on Lockean Proviso, they might want to start liquidating human beings whom consume "more than their fair share" just to be morally consistent. After all, it's these damn, unnatural humans ruining nature, unlike other sentient beings that inhabit this environment, and whose movements are not seen as a subversion of nature.

Some groups have already made this final step towards a balanced stewardship of resources such as China with their "One Child" policy. It's wonderful to know that they perform forced abortions and sterilizations, after all, we can't all be greedy little pigs, eh?

I suppose that these same people can't be advocates of dialectal materialism, because what difference would it make to a purposeless machine or a collective of automatons if they would be adequately supplied with resources to operate in the future? Then again, they could possibly answer that we are programmed to think it does make a difference and are being 100% natural to continue operating according to this ingrained nature. It also leaves them with a question of why they would voluntarily choose existence over non-existence, but this is where my head starts hurting from existential exercises.

Therefore praise be heaped upon those who force gaia's legs shut and help stop the human pestilence from consuming the world!

Sunday, August 06, 2006

caveat lector

Perhaps proving that bookworms and peliculists (is there a word to describe movie junkies?) have more fun than everyone else...

Page 62 of Ken MacLeod's The Cassini Division pays homage to Oskar Lange:
"the (almost deserted) great hall of the Central Planning Board with its golden statue of Mises... Alas for plans."

As I learned from the last quarterly journal of Austrian Economics (and as I subsequently found quoted in this article written by the esteemed BK Marcus), Oskar Lange paid mocked homage to Mises in a 1936 response to the arguments of Professor Hayek and Robbins. Lange said, "socialists have certainly good reason to be grateful" to Mises for forcing them to "recognize the importance of an adequate system of economic accounting to guide the allocation of resources in a socialist economy." He even suggested that a "statue of Professor Mises ought to occupy an honorable place in the great hall of the ... Central Planning Board of a socialist state" in "recognition of the great service rendered by him" to the theory and practice of socialism.

In Alastair Reynold's Century Rain, Casablanca-ish similarities abound. Dialog such as
"stick my neck out" (page 116), "the beginning of a beautiful friendship" (page 457) and "We'll always have Paris" (page 496)
are clear references to the film noir classic, most probably to invoke a direct comparison of Floyd and Auger, the story's protagonists to Bogart and Bergman.

The story's love triangle, the lifelike characters whom exude multi-dimensionality, make this book stand apart from your typical space opera, the like of which so often contain the hackneyed panel of shallow caricatures. You can practically sense the murkiness of the cigarette smoke in this sci-fi turned silver screen whodunit?.

A rather shallow reference though is the story's human faction known as the "Slashers", an allusion any /.'er worth his salt has got to be brain dead to miss.

Robert A. Heinlein's Time Enough for Love is loaded, yes, loaded with semi-esoteric concepts, intimately familiar to Austrians or other studied libertarians. Perhaps its not what you would call jocular material, but I still appreciated those juicy bits with a suppressed chuckle of amusement.

Lazarus Long, the main character, is one part John Galt, one part Ragnar Danneskjold, and three parts a lecherous, licentious, and lascivious old man. I'm pretty sure I've seen it written somewhere that Heinlein identified himself with this character's espoused ideologies; methodological and egotistical individualism, vigilante/private justice, and -- catch your breath -- liberal usage of the reproductive organs with others, including one's immediate family, animals, and even his own clone. (For further reading of Heinlein's views on sexual taboos, see Stranger in a Strange Land, The Moon is a Harsh Mistress, or I Will Fear No Evil. Especially the latter book.)

Observe some choice dialogue:
"I don't feel well, yet I can't die. So I'm stuck between the suicide switch and giving in for the full treatment... the donkey that starved between two piles of hay."
Buridan's Ass-- page 14.

"Ernie, where is the money?
"What money duke?"

"'What money??!' Why these account books show that you've taken in thousands and thousands of dollars. Your own trading post shows a balance of nearly a million. And I know you've been collecting mortgage payments on three or four dozen farms -- and haven't loaned hardly anything for a year or more. That's been one of the major complaints, Ernie, why the selectmen just had to act -- all that money going into the bank and none coming out. Money scarce everywhere. So where's the money, man?"

"I burned it" Gibbons answered cheerfully.

"Certainly. It was piling up and getting too bulky. I didn't dare keep it outside the safe even though we don't have much theft here -- if somebody stole it, it could ruin me. So far the past three years, as money came into the bank, I've been burning it. To keep it safe"

"Good God!"
"What's the trouble, Duke. It's just wastepaper"
"'Wastepaper? It's money "

"What is 'money' Duke? Got any on you? Say a ten-dollar bill?" Warwick, still looking shocked, dug out one. "Read it, Duke " Gibbons urged. "Never mind the fancy engraving and the pretty paper that can't be made here as yet -- read what it says "

"It says it's ten dollars "
"So it does. But the important part is where it says the bank will accept that note at face value in payment of debts to the bank " Gibbons took out of his sporran a thousand dollar banknote, set fire to it while Warwick watched in horrible fascination. Gibbons rubbed the char off his fingers.

"Wastepaper, Duke as long as it's in my possession. But if I let it get into circulation, it becomes my IOU that I must honor. Half a moment while I record that serial number; I keep track of what I burn so that I know how much is still in circulation. Quite a lot, but I can tell you to the dollar. Are you going to honor my IOU's? And what about debts owed to the bank? Who gets paid? You? Or me?

Warwick look baffled. "Ernie, I just don't know. Hell, man, I'm a mechanic by trade. But you heard what they said at the meeting "

"Yeah, I heard. People always expect a government to work miracles -- even people who are fairly bright other ways. Let's lock up this junk and go over to the Waldorf and have a beer and discuss it "
Banking and Currency theory -- page 272.

There are a couple more, I'm sure of it, but I don't have the book around at the moment; and by golly, there is always another day for that to be explored further.