Wednesday, April 23, 2008

zoning for death

A NY Times editorial published today insinuates that the heady sin of avarice is alive and thriving in the real estate industry, to the detriment of public safety. The article speaks of various regulations that Department of Buildings has tried to implement in the wake of the tragedy at ground zero, among them the widening of and the increase of required staircases.

The main force against such safety precautions is said to be the real estate industry, who are stalwart against the maximization of 'dead weight', space which is neither rentable nor salable, and hence unable to be capitalized.

As usual, what we have here is a few bureaucrats attempting to supplant the will of the people, to try to overrule their desired level of safety, to force them to pay for more safety then what they are willing to voluntarily part for by themselves.

[Monetary] greed, the most maligned, misunderstood characteristic is bandied here as though it simply were a destructive life force of its own. Say what you will of morality in general, but scratch an avowed amoralist, and you should find his instinctual hatred for avarice right there for all to see. I certainly can recognize the presence of greed, but I try to avoid ascribing to it the power of causal explanation.

In this case, it would be far more fruitful to state that the prior intervention of zoning regulation has come at the expense of public safety. Zoning, by arbitrarily and artificially constraining the natural growth of the human habitat has upset the delicate balance of market preferences into favoring space-maximizing strategies at the cost of public safety. It is a safe bet to say that in the absence of such well-intentioned intervention, society will have a better chance at working to obtain an optimal admixture of safety, and pleasant cages than it would otherwise.

Instead of pettily focusing on the motive of greed, it would be more mature (and productive!) to recognize it as an immutable nature of what it means to be human, and to let institutions and relations develop anarchically around that natural formation how they will.

Thursday, April 10, 2008

bookmarking bastiat

I've been sending myself emails whenever I come across passages of particular interest when reading the new collection of Claude Frederic Bastiat's essays on economics prepared by the Mises Institute. I'm not quite done yet, but I've already live-tagged so many nuggets I figured I would start sharing them with my imaginary readership.

So here without further ado is Bastiat on the topic of justice
"When law and force keep a man within the bounds of justice, they impose nothing upon him but a mere negation. They only oblige him to abstain from doing harm... In fact, it is not justice that has an existence of its own, it is injustice. The one results from the absence of the other." — book 1, page 64

On the contradictory absurdness of dialectical materialism
"They divide mankind into two parts. Men in general, except one, form the first; the politician himself forms the second, which is by far the most important.

In fact, they begin by supposing that men are devoid of any principle of action, and of any means of discernment in themselves; that they have no initiative; that they are inert matter, passive particles, atoms without impulse; at best a vegetation indifferent to its own mode of existence, susceptible of assuming, from an exterior will and hand an infinite number of forms, more or less symmetrical, artistic, and perfected.
" — book 1, page 67

Everybody except for themselves of course, a parody of fine quining.

Where he asserts binary exchange is a trade of equal satisfactions to each party—
"After much investigation it has been found, that in order to make the two services exchanged of equivalent value, and in order to render the exchange equitable, the best means was to allow it to be free... When we look into these subjects, we are always compelled to reason upon this maxim, that equal value results from liberty. We have, in fact, no other means of knowing whether, at a given moment, two services are of the same value but that of examining whether they can be readily and freely exchanged." — book 1, page 144
And explicitly rejects Condillac's theory of the inequality of exchange
"The explanation Condillac has given appears to me to be quite unsatisfactory and empirical—in fact it explains nothing. “From the very fact,” he says, “that an exchange is made, it follows that there must be profit for the two contracting parties, for otherwise it would not take place. Then each exchange includes two gains for humanity"...Holding this proposition as true, we see in it only the statement of a result...Exchange includes two gains, you say. How? Why? It results from the fact that it takes place. But why does it take place? What motive has induced the contracting parties to effect the exchange? Has Exchange in itself a mysterious virtue, necessarily beneficial, and incapable of explanation?” - book 2, page 90

In the former quote Bastiat endorsed the idea that value is a subjective notion, an indeterminate quantum event valid to but a specific moment, observable only through the action of exchange. That's all nice and shiny, however I think Bastiat's criticism of Condillac's theory applies equally as well to his own notion of equal value; how do we know the observed exchange was of equal values? Through the fact that it took place? But why does it take place?

It also seems odd to me that here Bastiat disapproves of Condillac utilizing an empirical method to prove his inequality of exchange theory when Bastiat himself asks the reader to do the same to arrive at the notion- stating that only upon examination of exchange do we know that the values are equal. It's odd to me because Condillac is in fact utilizing a deductive method, to reflect upon a given event to deduce that if it occurred, it was because each party gave up less than what they expected to receive. And furthermore, it seems to me that what Bastiat calls "examination" is also not empirical fact gleaned through a posteriori observation, but rather a priori deduction!

Note: Philosophy mavens and bowtied economists of the cloth are hereby invited to comment and set me straight as to what Bastiat is saying. For now, I'm taking this to be the sometimes unavoidable result of a translation where concepts get mangled when bridging that gulf.

Friday, April 04, 2008

from the frontline trenches of the war on patterns

I posted the following comment to a Gothamist post relating a NYPD raid on a Queens-based warehouse containing eight trailer loads of goods which were subsequently plundered.

In a non-Kafkaesque world, the headlines would read:

"Brazen Bandits Make Off with $4.5m Worth of Goods, Kidnap and Take Hostages into Involuntarily Confinement".

The government is the only agency which should be prosecuted for counterfeiting; the crime of defrauding [and coercing] customers into exchanging one good for another good of inferior quality.

For a transaction in which both parties are fully aware of the nature of those items which they exchange, it cannot be justly said that there is a victimized party, i.e. when Ms. Tourist purchases a 'Gucci' purse in Chinatown neither party is harmed by the consensual exchange, and in fact both parties profit in the ex-ante sense.

I know that some of you think that perhaps there are other victims here that should be taken into consideration, perhaps the Gucci corporation, or the NYC Department of Finance which didn't steal, umm, 'collect' a sales tax on the transaction.

For one, the Gucci Co. can only be a victim if they were actively deprived of a physical good, or the use of that which they already own. In this case, fictitious rights to so-called "IP" is exactly that, a scam fostered upon the backs of society to prop up the sales revenue of pattern monopolists.

Thursday, April 03, 2008

cranial tragedy

What's that poor excuse for government licensing requirements-- oh yes, oversight for public safety purposes.

Stories like the recent tragic crane collapse in Manhattan which killed seven [see the shocking NY Times report here] bring to light what I call counterfeit goods, the supposed 'public goods' which the intervention of government is allegedly providing but is not in reality. It's no surprise at all to me that such tragedies occur when society mistakenly relies upon a unaccountable government agency whose task is to oversee that crane operators know what they're doing.

This does not mean to say that I think that construction 'accidents' never just happen; I just think it more likely to be the case because of the existing statist-quo than perhaps what counterfactually might occur otherwise in a privately regulated industry.

I'm also quite interested to learn if the insurance companies that insure the crane operators rely on those very same government-approved credentials/licenses to be their sole assurance against underwriting an excessive risk.

In any case, the provision of the supposed oversight by government agency also tends to crowd out private efforts to do the same, especially if the insurance companies didn't overtly prefer a private evaluation of those same credentials.