capitalism, misdefined

A couple of days ago, I commented on a post at lowercase liberty in regards to R.A.W. and his knowledge of economics as I understood from his writings.

I then realized that my initial comment was harshly imprecise; while R.A.W. could have been knowledgeable in economic theory (although I'm convinced he wasn't), he certainly was sloppy in confusing normative ethics prescriptions with economic systems.

Please witness this one egregious abuse:

"When Playboy fired him, Shea endured terrible anxiety about keeping his house, and dashed off a few novel outlines while looking for another job. He sold his first novel before finding a job and never stopped writing again. I still treasure his comment on why the Bunny Warren cast him out. "I worked hard and was loyal to the company for ten years," he wrote. "I guess that deserves some punishment." I treasure that as the best comment I have ever heard about capitalist ethics."

Erggh!!! I'm certainly not sympathetic to the "bosses are evil" definition of capitalism, and to say what social behaviors are prescribed by capitalism is bunkum.

As far as I know, capitalism is a description of economic system in which individual rights and ergo, property rights are respected, and while some may seem to have better bargaining power, at the end of the day, its the little guy, the consumer who is unforgiving, disloyal, tough to please and is always punishing those soon-to-be non-producers who aren't serving their desires adequately. So no hard feelings dude, its not personal.

Inigo Montoya's timeless words are thus suitable for this misdefintion of capitalism -- "You keep using that word. I do not think it means what you think it means."

the socialist tree calculation

(cross-posted to the Mises blog)

While the headline of a recent New York Times article employs a subjectivist notion of value, "Maybe Only God Can Make a Tree, but Only People Can Put a Price on It", the article makes it clear that the concept of price formation is something less well understood in the so-called paper of record.

Witness how the tree prices were derived:

"Step 1 was a tree census, a two-year process that sent more than 1,000 volunteers to count every tree on every street in the city. The census results were then fed into a computer program that spit out a dollar value for each of the 592,130 trees counted, a figure that does not include the roughly 4.5 million trees in parks and on private land...

It takes into account several factors, including a tree’s impact on local property values, its contribution to cleaning the air by absorbing carbon dioxide, and how much its shade helps reduce energy consumption.

Factoring in the costs associated with planting and upkeep, New York City’s street trees provide an annual benefit of about $122 million, according to the Parks Department. The study concludes that New York receives $5.60 in benefits for every dollar spent on trees."

But wait just a second-- how does a computer program determine the price for the trees? I'm reminded of Gary Galles's article "And Then a Miracle Occurs." Much like the cartoon professor who uses that phrase as a stage in a mathematical proof, the "price-calculating" black-box could only invoke some arbitrary determination based on of what the historical market demand has been for street-side trees.

Now although the city government presumingly pays market prices to private contractors for the planting and maintenance of these trees, the notion of these trees now having a determinable market value or price is quite meaningless without a market to set them. To further ascribe the role these trees play in property valuations is an empty consideration without the knowledge of what opportunities were forgone with their planting. Thus is the nature of the socialist beast.

The root of this problem :) was brought up by Mises over 80 years ago in a series of articles beginning in 1920, shortly thereafter culminated into his Socialism: An Economic and Sociological Analysis in 1922, and later in his treatise Human Action.

Lacking both omniscience and a market to determine the value individuals place on trees, planners cannot determine the opportunity cost that the trees represent, making any monetary calculation of the benefits provided a worthless spectacle of ignorance on stilts.

aphasiac

Everyone knows what to call the lack of sight, hearing or speech. But I've long wondered what to call the lack of ability to either smell, taste, or to feel objects.

Thanks to OneLook, I now know that:
hyposmia is a "lessened sensitivity to odors."

anosmia is the "absence or loss of the sense of smell."

hypogeusia is a "decreased sensitivity to taste."

ageusia is the "loss or impairment of the sense of taste."

anaphia is the "total or partial absence of the sense of touch."

Now just to commit those words to my vernacular, so that they roll off my tongue with the same smoothness that I have for expressing blindness, deafness and muteness.

point of view

From Ayn Rand, I've learned that appeals to efficiency are not as important as liberty, and that even if methodological individualism and capitalism were to be more "costly" policies to society, we should still prefer liberty to interventions seeking to enhance efficiency and stability.

From Ludwig von Mises (and Murray Newton Rothbard) I've learned that appeals to efficiency are false because costs are subjective and hence unmeasurable. Furthermore, they demonstrate in so many ways how interventions is always a decrease in utility, and would probably cause more instability, not less.

From Robert Anton Wilson I've learned that all appeals to efficiency are essentially an appeal to an illusion, a fiction with no bearing on reality.

A simple example which demonstrates the difference between all three positions would be that of your typical environmental concerns.

Ayn Rand would insist that human life is the ultimate end, and that appeals that value biological and ecological diversity above human life is irrational and anti-life.

Mises or Rothbard would argue that environmental concerns are those problems which stem from the lack of rigid property rights, the classic tragedy of the, [because there are] commons. Once polluters have to internalize all aspects of their costs, the environmental problem stops being a societal concern and one for individuals to work out in a tort system to minimize specific, individual harms. Furthermore, they would point out that government, and not private concerns have been the greatest polluters simply because they have no incentive to be efficient, as all pollutions are essentially a form of inefficiency on part of the producer who have not captured the fullest usage of all their output.

I haven't seen Robert Anton Wilson's position on environmentalism, but if he were to be a consistent discordian, he would insist that the environmental bugaboo is to be biased towards certain chemical compounds, as if the earth or "mother nature" cares for a particular composition or molecular arrangement (which it obviously doesn't). It cares not if the entire surface is desert, water, ice, forested, denuded, or atomic wasteland. The homuncular inhabitants may have their neurological circuits prefer a specific scenario, but it wouldn't exceed a normative whim in importance.