Tuesday, January 29, 2013

Status Update

My apologies to all regular and intermittent readers, I seem to have trouble getting much written lately. I am afraid between work and a bout of worse than usual ill health, I have not been terribly productive recently. Still, I do have three essays which are partly complete, and I am going to go out on a limb and promise that by Sunday I will have all three posted. I doubt I will do more than that, but I will do all I can to get those three on line.

Hopefully future weeks will see me writing at a pace more like my usual, but for now I will be quite happy to post those three. So, please check back this week, as I do intend to get some substantial essays posted.

Thursday, January 24, 2013

Stray Thoughts

I had a few stray thoughts today, and, since I don't have the time to write a proper blog entry, I figured I would share them instead. At the moment (2013/01/24 6:00 PM) I only have two, but if any more strike me later today, or in the days to come, I may update this post. At least until I have time to write a proper post. And so, without any more introduction, here are my thoughts:

1. For all our talk of "sustainable agriculture", has it struck anyone that we managed to farm, at least 5000 years, and according to some theories even 10-12,000, without worrying about sustainability, and seemed to do pretty well? Why do we suddenly have to give so much thought to something we did so well without it? It is akin to devoting a massive effort to studying how to urinate or breathe.

2. The left loves to talk about the common man and trying to help out those with less, yet wherever they gain a majority in the government they raise taxes, enact programs such as "smart growth", enact environmental regulations and tax everything to such a degree that no common men can afford to live there any longer. Just look at, say, San Francisco, or the Baltimore-Washington region, or New York City. Yes, urban environments tend to be slightly more expensive, but if we removed smart growth, rent control and other bad ideas, they would hardly be the absurdly expensive regions they now are. So, how on earth are these laws intended to benefit the "common man", who cannot afford a house, or even rent, and can no longer find a job?
As I said, more to come as they come to me. At least until my schedule allows me to write at greater length once more.

3. (2013/01/25) The media loves to obsess over how we could stop teen murderers. After Columbine they spent months wondering how we could deter future similar events. Well, here is a thought. Since so many narcissistic teens want to kill others to "be famous" maybe if the media didn't spend so much time spotlighting the last killing we might not inspire the next one quite as much. Having made celebrities of serial killers to the degree we have (and in a way very different from how the past treated, say, Jack the Ripper, who was not given the fawning "Dexter" treatment by the 19th century press), it is easy to explain why teens might seek this route to fame, and given that, maybe we have a pretty easy solution. But as the press thinks nothing exists unless they spotlight it, I doubt we will ever see this solution carried through.

UPDATE to #3: (Later the same day) Just to make this clear, I am not saying our lionization of serial killers, or even our simple fascination, is to blame. It simply takes away the stigma of choosing that path to fame, and the media makes it clear that killers will become famous. As we seem to value fame, or even notoriety, above all else, in our juvenile culture, it is predictable that fools seeking fame will choose this route. Were we to spend less time "getting to know" each killer, if we failed to spend months examining them in detail, they would not be such celebrities. And, if our culture were to make clear that serial killers are sick, troubled, pathetic individuals, not heroic genius outsiders, then perhaps it would not be such a popular career choice among a certain type of sad loner. It certainly would not stop these crimes entirely, but it would make them much less common. (Then again, to a degree, our impression of the increasing pace of crime is a media artifact itself, but that is another post.)
4. (2013/01/26) I am, as should be clear from many posts (eg. "Guns and Drugs", "Hard Cases Make Bad Law"), a proponent of decriminalizing drugs. However, I need to make clear, by saying that, I mean exactly what it says, I support eliminating all laws relating to drugs, leaving them in a legal situation identical to, say, brooms or aluminum siding, a value neutral product, at least as far as the state is concerned. I need to say this, as some, especially on the left, have adopted a strange position they call legalization, but which they describe as "treating it as a medical, not a legal, question". In practice, it seems these people are not truly for legalizing drugs, they would still actively pursue drug dealers, the only difference seems that they would take the "treatment track" which middle and upper class users, especially young ones, tend to be placed upon rather than seeing jail, and apply it to everyone. In other words, they are not truly decriminalizing, they are simply sentencing people to treatment and using inpatient treatment in lieu of jails. and just as with our present system, though it is never made clear, I have a feeling those who fail to call themselves victims and addicts and go along with the treatment plan will find themselves facing some sort of legal penalty, just as today. All of which makes it funny to hear these plans described as "legalization", both by proponents and critics, as in truth it is not very different than what happens today. (In a few cases, some have gone to greater extremes, and proposed "containment" policies, providing drugs to addicts until they undergo some sort of mandatory treatment, but I have never heard this suggested for all drug users, so it is but a small part of the system, and, as it still requires mandatory treatment for those who use drugs -- presumably with legal penalties for those who refuse -- it is not exactly legalization. It is simply a system which provides an alternative to jail, but it still applies the coercive forces of the state to those who use drugs, which is not legalization in any meaning I accept.) Whether or not one agrees with legalization, I think anyone honest would have to agree that anything which forces someone to undertake an action he would not do otherwise, and implicitly threatens with jail those who don't, is not a system of legalization.
5.(2013/01/27)  Item #3 reminded me of a common mistake many seem to make. In saying that X causes something, I am in no way excusing those who choose to act. Despite the many who confuse psychology for morality, understanding someone's motive is not to excuse his actions. For example, John may have been abused as a child and then abuse his children, this may explain his actions, but it is not an excuse. He still chose to do so, and many others from similar environments chose to do differently. Unfortunately, for many people the language of psychology has made them convinced humans essentially lack volition and thus they confuse explanation for excuse. But, even if we can see the motive, that does not excuse them from choosing the wrong course. And, more importantly, whatever the reason they chose the wrong course, they are still violating the rights of others and need to be excluded from society. So, whether you wish to excuse them or not, they still need to be treated as a danger. (And, as should be clear, in my post above, I had no intention of excusing those who decided to pursue fame through mass murder, whatever role our juvenile culture and content starved media played in their decision.)
6. (2013/01/29) I understand why there is a movement among many to emphasize phonics in spelling, especially in those schools which have gone too far in the opposite direction under the influence of the one time dominant "look-say" dogma. (Having a teacher for a mother, I get a little insight into this, and it does seem even among the more dogmatic schools of education, the resistance to including phonics has been on the decline since the heyday of anti-phonetic education in the 60's, 70's and 80's.) However, while doing homework with my son tonight, and finding three words which had one or more homophones -- grown (homophone of "groan"), thrown (throne) and "pour" (poor and pore) -- it struck me that phonetic teaching alone has some serious issues as well. First, there is the problem that English pronunciation offers multiple ways to generate the same sound (shoe and shoo for example), and multiple ways to pronounce the same spelling (eg wind - for twist and blowing air). This many-to-many mapping undermines some of the claims for mechanistic simplicity offered by phonics proponents. Second, many dialects offer pronunciations which differ from the standard, and most tend to also reduce the number of sounds, making even more words homophones. For example, in many mid-Atlantic dialects, "pin" and "pen" are identical, as are "ten" and "tin", and "gym", "Jim" and "gem". This sort of Mid-Atlantic English* ioticism, along with a tendency to turn many terminal vowels into a sort of schwa sound (eg the way "the" has become "thuh" and "a" became "uh") has also made it more difficult to rely on how words sound -- that is the basis of phonics -- as a guide, since the way words sound to most students will not match well with the proper spelling. Finally, there is one additional problem in that English, more than any other language, is made up of loan words. From its origins as a hybrid of German (Anglo-Saxon), a smattering of Latin and Celtic remnants  and a healthy dose of Norman French, it has absorbed a myriad of words from almost every conceivable Romance language, many Slavic and Semitic tongues, even Asiatic, African, Pacific islander, Australian and American languages (eg tattoo, taboo, boondocks, typhoon and [maybe] catsup). Many import words were integrated into the English system of spelling, especially those that came from languages without their own alphabets, or at least that did not use the Latin alphabet. (But even this proves a problem, as many were integrated using the phonics of their era, many 17th and 18th century, and thus followed different rules than today.) However, for languages with Latin alphabets, we often simply imported the existing spelling, requiring that a phonetic spelling follow the phonetic rules of, say, French or Spanish, rather than English. And thus, English requires, if we are to use phonics alone, one know not just modern English phonics, but also the phonics of most Romance languages.

I am not trying to argue against phonics. I think a phonetic system is a great starting point for learning spelling, and a very useful tool throughout life in trying to decode unfamiliar words. I simply want to caution that, as with all reactions to a given orthodoxy, some phonic proponents may go too far in pushing phonics as the sole solution, and overlook its shortcomings, and the need to supplement a foundation based upon phonics with lessons in other methods to spell and read words. Clearly, these alternatives should not be given the dominant role they once were during the period when phonics was viewed with such disdain, but there is a place for additional approaches, given the way that English resists a completely phonetic approach to spelling. (For those keeping track, yes this is one more place in which I have criticized what was, and in some circles still is, a hot button issue among conservatives. Though, in this case, I am quite sympathetic to the position, I just think it may need to be opened up a little bit.)
* I used Mid-Atlantic English as it is the dialect with which I am most familiar, but there are similar patterns in many dialects in American English, as well as in the dialects of other English speaking nations. Ironically, the dialect most Americans mock most often, the dialect of the southeastern US, tends to be the American dialect to contain the most distinct vowel sounds, making phonetic transcription easier than in other dialects. (Granted, some variations of the southeastern dialects do not follow this rule, but it is generally true.)

Tuesday, January 22, 2013

The Price of Equality

I have started reading an interesting book describing the formation of medieval European society out of the many barbarian groups of the Roman era. There are any number of interesting topics raised, just in the first few chapters. First, there is the discussion of how the dominance of the migration theories of the 19th century produced a reaction in the 50's and 60's which went too far in the opposite direction, all of which suggests any number of interesting analogies to other topics. There is also a lot of interesting discussion of national and other group identity and the question of how fixed or flexible such identities might be, as well as the role that one's political and academic biases play in establishing a position on this question. This clearly has relevance to a question I have addressed more than once, the importance of preexisting bias in academia, but beyond that it also offers some novel insights into theories of nationalism, both right and left, and even my recent discussion with reader CW on the topic of political identity. However, for the moment I am not going to discuss all of these topics, instead I want to look at a topic I came across this evening, the connection between inequalities of wealth and the growth of society.

The author asserts that the archaeological and historical records demonstrate a universal connection between the appearance of significant inequalities of wealth and the growth of a society, in terms of complexity, economic development and general permanence -- of settlements, of structures, of social organization and the like. As it is not a topic I considered before, I have not looked into this assertion, but it makes sense (as I shall explain shortly), so I have no reason to doubt it.

What first drew my interest was the discussion immediately following this assertion, in which the author mentioned the orthodox Marxist explanation of this phenomenon, which the author dismisses as simplistic. According to Marx, this is the result of the ruling class forming the social structures to favor their interests, resulting in the accumulation of wealth in the hands of a few nobles.

I would argue that there is a much more obvious explanation. Inequality is innate in humanity. We have differing capacity for hard work, differing intellectual capabilities, differing physical abilities, differing ability to learn new skills or to create novel solutions, we value clothing, food, shelter and luxuries to differing degrees, we are sickly or well to differing degrees, place different premiums upon work and leisure, and so on. If we were to take a dozen randomly selected individuals and stranded them on identical uninhabited isles, they would differ in the amount of food they produced, shelter they built, clothing they crafted and the like. And similarly, in a given economy, if individuals are allowed to produce freely and keep the proceeds of their labors, then they will end up with widely different amounts of wealth.

But that would seem to suggest that such inequalities of wealth would exist from the dawn of time, and not simply appear at a certain stage of development. Why would early societies show so little inequality of wealth?

The answer is twofold. First, there is the instability of early society, the lack of the stability we find in later stages. Second, there is the level of economic development, which is probably the more significant of the two. But before explaining how a lack of economic development -- or at least being at an earlier, or less complex, stage of development -- dampens the influence of natural inequalities, let us look at instability.

Primitive societies, at least at certain stages, tend to practice extensive agriculture -- which involves, among other traits, the movement of entire communities when farm land loses fertility -- if they are not simply pastoral or nomadic tribes. Under these circumstances, there is little opportunity to invest in the accumulation of capital or the development of any sort of complex procedures. Thus, the opportunities for converting additional effort into higher productive capacity is relatively small, and even those opportunities that do exist are often undermined by movements of the tribe that make previous improvements of little or no value.

But that is simply one problem brought about by instability. as I have discussed at length elsewhere, instability leads to uncertainty, which tends to undermine any sort of planning. This is a universal truth, which holds for primitive societies as much as for modern. For example, in discussing the early Germanic tribes, the author wrote about the lack of long lived political structures prior to the 3rd or 4th centuries AD. As there were no innate checks upon the powers of a given leadership, this meant that one could not readily rely upon consistent treatment. Granted, tradition and the need for general popular support would act as some sort of check upon the exercise of unlimited power, but they were limited checks. It was completely possible that the tribe which was a close friend one day might be a foe the next, or what had been an acceptable practice one day might be prohibited  on short notice. Of course the simplicity of the economy limited the potential harm to some degree, as trade was a lesser factor than it would become later, but in a way, this instability also served to keep the economy simple by making the prediction necessary for trade impossible, so it both harmed what little trade did exist, and prevented the growth of any new trade by making any sort of anticipation difficult.

And then there was the general centrifugal forces which exist in such societies, which both tend to break apart larger social structures, and leave those which remain at one another's throats much of the time. This is not to say that the Germanic tribes were in a state of constant warfare, or anything of the kind. What it does mean is that war, or simple raids, could occur without warning, and were frequent enough to become a regular feature of life. It is, in a way, very similar to the life described in the border lands between England and Scotland prior to the Stewart monarchies. (See "Bar Fights, Riots and Drug Markets - The Limits of Law".) Such circumstances tended to lead one to consume more than he would otherwise, as portable wealth was the target of such raids and ownership of considerable wealth was seen as an invitation to attack. This is not to say that no one kept portable goods of value, obviously there was some wealth, at least in terms of what was possible in such a basic economy, but that wealth was also frequently lost to warfare, resulting in a general equality of poverty for all.

But those are all of secondary importance when compared to the simplicity of the economy. If any one factor could be said to have concealed all inequalities of ability and left the impression of near equality of income and wealth, it was the set of primitive production methods used in such societies.Because agriculture rarely rose above mere subsistence, and the technologies did not embrace fertilizing, irrigation, crop rotation and other improvements, leaving land clearance as the only means of increased production, there was a clear upper limit to the amount of land one man could farm, and the likely produce was little more than enough to support him. This meant, regardless of his innate abilities, it was difficult if not impossible for a man to produce much surplus to either accumulate as wealth, or to convert into some other form of wealth, through trade or through using it to support a non-farming specialist. The methods of farming were simply too basic for one's abilities to make much difference.

This lack of surplus also served to cut off all other possible avenues of wealth, all other means by which one might show his superior abilities and use them to improve his lot. Without surplus wealth, there was little to trade away, and little to use to buy imported goods, so trade was not likely to exist in any but the most basic form. Similarly, with so little surplus, individuals were reduced to self-sufficiency, allowing for no specialists. That is, an individual had to form his own tools, build his own shelter and make his own clothes. In a richer society, the surplus of food can be used to support non-farmer specialists, or in poorer societies, part time farmers who are also part time specialists, expert in carpentry, metal working, leather work and the like. But when surplus is so slender, there is simply not enough in the entire society to feed a specialist even part time, so, despite the inefficiency of doing so, each household must produce its own goods. Which also means that those with skills that could be applied to such activities have no opportunity to use these skills, and thus another avenue to increasing their wealth is closed to them.

All of this changes dramatically when agriculture becomes more productive. Whether from the opening up of new, more fertile lands, the introduction of new technologies, changes in climate or the introduction of new crops, once a single farmer can produce significant surplus food, all of those avenues for inequalities of wealth are opened up. This is especially true if technological change allows for intensive rather than extensive farming, meaning the investment of effort can increase the value of the land itself, improving the yield from the same amount of farming effort. But even without intensive farming and the accumulation of capital in farm land, the surplus can still be used to provide sustenance for specialists who are also capable of using their superior abilities to earn more than their less skilled peers.

It should be obvious from this description that inequalities of wealth are an inherent part of an economy that rises above simple subsistence, and are not a sign of some machinations by scheming elites. Admittedly, once the surplus of wealth allows for the formation of a professional class of rulers, they tend to set their own "wages" rather high, but in a way they are still simply a part of the economy. If the people begin to feel the ruling class is providing less benefit than it costs, it is hardly unheard of for a society to eliminate rulers. Even rulers who also provide for a well paid military caste are not immune, as an unpopular ruler may not be knocked off by the people themselves, but is still quite likely to be eliminated by an ambitious and slightly more popular subordinate. But all of that is another topic for another essay. The point here is that innate differences in human beings are the reason for differences in wealth and income, in all societies, and that the most primitive societies are alone in not demonstrating such inequalities because the low level of productivity makes it difficult to detect the differences in output due to differences in abilities.

However, interesting as I found all of that, it should be clear to regular readers this essay has, so far, lacked the modern relevance I usually insert into such seemingly off topic subjects. Granted, I did manage to get in a dig at orthodoxy Marxist theory, but that is hardly enough reason for writing this entire essay. No, the reason for this essay is yet to come, and does offer a modern relevance to this topic.

The reason this matters for modern readers is not that subsistence farming and simple pastoral economies allow for little or no inequality of wealth, what matters for modern readers is that total absence of such inequalities can only be achieved in such economies, and those who seek total equality have no alternative but to return to subsistence level.

I am tempted here to offer little in the way of theoretical argument and simply point to the tremendous decline in the standard of living in the Soviet Union (which was hardly an economic powerhouse under the tsar) as a result of communism, the ever increasing technological gap in all but military technology between the USSR and the west. Or perhaps point to the few supposed successes of communism, all of which involved either a step away from absolute equality, or else some form of wealth transfer from outside the communist world. However, many do not accept such evidence, or have a counter argument, perhaps that it wasn't "true" communism, or the "wrong people" ran things. ("The Inherent Disappointment of Authoritarianism", "The Right People, The Wrong People and "Just Plain Folks"") So, to allow for a simple, and hopefully brief, proof, allow me to argue from human nature.

As I have written repeatedly ("Competition", "The Basics", "The Case for Small Government", "Greed Versus Evil", "A New Look At Intervention"), humans are almost completely rational. This is not to say they are emotionless logical automata as some straw man responses suggest. ("Bad Economics Part 16") What I mean is that people, operating on their own personal value system, will always make decisions that trade something of lesser value for something of greater value, by their own lights. This doe snot mean they will always trade to make money, or that they will always act to benefit themselves alone, if I value my son's happiness more than my own, I can exchange something so that he is more happy while I am less, to offer one example. Nor does it mean people will always choose well. Sometimes they may think something will improve their lot and then find out they were wrong. However, within the limits of their knowledge, and judged by the values held by each individual, almost every human will act in such a way that he always exchanges something of lesser value for something of greater value.

Hopefully that is an unobjectionable statement. I admit there may be one or two self-immolating individuals, perhaps a couple with some sort of severe mental problems, who intentionally act against their own values (though, if they value self-immolation, could we not argue they still follow the rule?), but by and large, every human, and certainly every one I have ever met, will act to make things better in some way, at least when judged by their own beliefs.

I mention this here, as this knowledge alone is enough to show how efforts to end inequalities of wealth and income can result in a reversion to a subsistence economy. I may have spent many thousands of words on this topic ("The Irrationality of Government Redistribution", "A Great Quote", "The Benefits of Inequalities of Wealth", "Envy Kills II", "The "Lucky" Rich", "The Other 99%"), and I will doubtless spend hundreds or thousands explaining it here, but in reality, this one realization, taken to its logical conclusion, is more than enough to undermine all belief in communism and kindred theories.

Actually, there are two processes involved, that which results from equality of income and that which results from equality of wealth. The latter is much more destructive and more rapidly so than the former, but both eventually lead to a return to near barbarism.

Equality of wealth is suicidal for very clear reasons. If, at some point, everyone's holdings are to be made equal, then everyone has an incentive to do nothing but consume. After all, there is going to be at least one person who will squander everything he owns. If, say, once a year wealth is to be made equal, that means that anyone who does not spend every cent will lose at least some wealth to those who do. Thus, under such a system, the greatest individual benefit accrues to he who spends the most. As a result there would be no accumulation of wealth, no investment, nothing. Which, for reason I hope should be obvious, will result in the rapid collapse of any business beyond the most absolutely basic.

Of course, it is possible that a system could propose a slightly less draconian system of wealth equality, say a system which sets a cap beyond which one may not accumulate any more wealth. This system would not immediately lead to the rampant consumption of the prior solution, but it would pretty quickly show very similar outcomes. After all, if one does save or invest, and his wealth begins to approach the cap, he cannot continue to invest or save, nor can he spend anything less than his entire pay check. Thus, while he might start off saving and investing, thanks to either interest or capital increase, he will approach the cap, and thus he will be forced, in the end into wanton consumption as in the last system, and, as in that system, he will be unable to save or invest, resulting in the same collapse. Slightly delayed, but otherwise identical.

Equality of income is less immediately destructive, but still will have similar results.

The problem here is what I described above, the human inclination to act reasonably. That means, if I earn the same for whatever work I do, then I will likely not choose a demanding job, or put in additional effort, if I am not going to receive a reward for it. A few might still want to be doctors or engineers or the like from a love of the field, but it is equally likely, as the frustrations which often accompany demanding jobs begin to be felt, that such individuals, if they are allowed to choose their job, may eventually choose to "drop out" and enter a less demanding field, as it won't change their standard of living one iota.

Similarly, if I am paid the same whether I do a marginal job or the best job possible, it is quite likely I will tend toward the marginal performance level. Yes, many of us feel pride in doing a good job, and would for a time do better work. But it is also true those of us who feel this way often get discouraged by seeing incompetence being treated as equal to superior work, and so it is likely such attitudes will not last for long.

In fact, it gets worse. As the level of work tends toward the minimum acceptable level, likely some will dip below that line into levels below acceptable. After all, if the average is at barely acceptable, a few falling below that are unlikely to be fired, since their replacement is prone to be only very slightly better. Nor is that the end. As the average drops, it will continue to do so. Without any means to attract better employees, that is without the ability to increase wages, there is simply no way to attract superior workers, or even distinguish good from bad. And it will effect all aspects of the economy. There is simply no way to prevent it. Acting rationally, seeing that they are paid the same regardless of effort, people will leap to the logical conclusion and put in as little effort as possible, eventually ending at either a collapse of the economy entirely, or a reversion to subsistence levels, as no one will be willing to take a job requiring more than minimal effort, and will not put in more effort than necessary for survival.

Some may now ask why this did not happen in communist societies, why the equality of incomes did not result in the collapse of the USSR or China. The answer is, in part, that it did, we have seen the rapid decline of productive ability, the tendency toward famine in the USSR, North Korea and elsewhere. Of course, in part this was also the result of other issues, such as the inability to establish costs and prices in a truly controlled economy ("The Problem With Microeconomics", "The Limits of Technocracy", "Technocrats", "The Limits of Econometrics", "The Limits of "Scientific" Management", "Knowing Our Limits", "Greed Versus Evil", "Some Additional Thoughts on Technocrats", "A Thought on Technology and Technocrats") , but the equality of pay definitely played a role. If anyone doubts this, look at the "brain drain" in even non-communist countries that applied, say, pay caps on doctors, or other professions. Some argue this flight was the result of greed, such professional simply wanting more money, and that is partly true, but it does not tell the whole story. They fled not out of greed, but because they wanted to be paid for the extra effort such jobs require. In nations which did not allow emigration, we can see the truth of this, as, rather than flight, there was simply a shortage of such professionals, as even those with innate ability went into easier professions, as the pay would not compensate them for their efforts.

And, of course, there was the one other solution. Ever since Lenin introduced the NEP, communist nations have shown a willingness to disregard orthodoxy when it proved too damaging, and pay equality is one of those areas. In many cases, they simply ignored their beliefs entirely, and allowed additional income for those holding certain jobs, be they the top ranks of the military or the most educated scientific researchers. However, that was not the only possibility. In a country with such an austere standard of living, it is easy to offer rather minimal perks and receive a strongly positive response. Thus, while they might still show an equality of income on the books, many others were bribed to greater efforts through better housing, better food, access to travel overseas or some other perks not available to the more plebeian classes.

Not to mention the flip side of this equation. In many cases it is easy to provide a positive incentive to make workers go beyond the bare minimum, but, in others, that would be politically unacceptable. And so, in many cases, recourse can be made to negative reinforcement, that is threats of one kind or another. And for a time perhaps such a system can work. But, as has been argued many times when discussing the relatively merits of free versus slave labor, slaves make poor workers. And, if the overseers are paid the same equal wage, it is likely they too will eventually fall into substandard efforts, leading eventually to the same collapse.

I know all of this could be explained at much greater length, and I have done so elsewhere several times. But for now, I think I will stop with a relatively brief argument. It is enough for me right now to show that not only is a subsistence economy the only type which will not show an inequality of income or wealth, but such a system is also the only system in which those situations can exist at all.


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Update (2013/01/23), or, The Confession of a Grammar Nazi: As I am such a stickler for spelling and grammar, I must admit when I make a foolish error. And, in this case, I am afraid my laziness got the better of me. You see, I recalled that centrifugal and centripetal were opposites of one another, and from my college physics I should be able to recall which is which, but I must admit I can't. I know centrifuges push matter outward, so centrifugal should be the destructive, outward throwing force. but I also recalled that there was a common physics term which was misused in popular speech, and I imagined it might be centrifugal. So, as I wrote, I used "centripetal" to describe forces breaking things apart, and told myself I would check it later. Well, I forgot, and so, tonight, I realized I had it completely backwards and was ascribing breakdown to forces which would bring things together at a single point.  I know it is a trivial point, but as I make such an issue of misuse of words, I thought I should confess to my own (now corrected) error

I also want to mention that this may be the last post for a few days, as work seems to be demanding a lot of my time once again.I have been assigned a rather labor intensive project which has kept me busy for the last week and a half, and will probably occupy me for another week or two. I will try to post, and respond to comments as rapidly, and in as much detail, as possible, but I think new posts may be somewhat infrequent.

A Little Follow Up

When i wrote in my last post ("In Loco Parentis") that ideally decisions would be returned to states, I am sure some readers would argue that questions such as restrictions on the purchase of alcohol are made by states. Well, yes and no. Maybe some are too young to recall, but in the 1980's several states and the District of Columbia resisted the trend to move toward a drinking age of 21 and persisted in insisting 18 was old enough. In response, the federal government none too subtly threatened to withhold highway funding unless they changed their minds. Thus, I tend to think of these laws, despite their nominal state origins, as national laws. And it also illustrates quite well why I worry that even such seemingly innocent powers such as funding highways needs to be eliminated, as it gives the central government a means to overcome any sort of federalism, by threatening to withhold funds.

Just wanted to clear up that one point, as I realized some may not follow my reasoning without come additional explanation.


Monday, January 21, 2013

In Loco Parentis

When I write that I want to see an end to not just drug laws, but prescription requirements as well, in fact that I would like to see an end to all laws regulating any sort of voluntary commerce, I usually get a host of criticisms. I obviously cannot address all of them, but I do have some thoughts thought I wanted to put out there.

One of the most common complaints is that if we ended, say, age regulations on alcohol sales, or allowed all drugs of any sort to be sold over the counter, then children would turn into alcoholic junkie degenerates in huge numbers. (I am tempted to say "so what would change?" but that sounds a bit cynical, and definitely marks me as someone on the verge of becoming a cranky old man.) However, there are two arguments against this conclusion which I think are worth considering.

First, prior to Prohibition, in many states there were no regulations about alcohol sales. There were dry counties and some states that had strong temperance movements had other regulations, but, for the most part, they did not touch upon age, but rather on limiting the hours and days of saloon operations, the strength and type of drinks and the like. There was just not much in the way of modern "carding". nor would it have worked anyway, as identification in the era before 1920 was minimal at best. Driver's licenses were far in the future, libraries were not common, and rarely listed age on any sort of cards anyway, and most people didn't carry around birth certificates (if they had a copy at all), so it would have been pointless to ask someone to prove his age.

And yet, there was not a tremendous outbreak of toddler tosspots. So, how was this done? Some would suggest it was a "different time", the dodge used whenever a historical example disproves a modern orthodoxy, but the truth is it wasn't. Excepting for the automobile, cities of the turn of the century were as urban and impersonal as they are today. Slums were slums, migrants were migrants, there was crime and filth and poverty and overcrowding worse than today. So, it was hardly some agrarian small town society which does not compare to today. Of course things were different in some ways, but not so different that one would find it an environment conducive to abstinence from alcohol. (If anything, alcohol consumption in modern times represents the end point of a downward trend from colonial times. Reading the consumption figures for the mid to late 18th century would give modern readers fits. And the 19th and early 20th centuries, though not rising to colonial highs of imbibing were hardly filled with tea totallers.So, again, it is not as if "the times" offer an easy explanation.)

No, one thing that did exist in the 19th and early 20th century was a principle now long lost, that is the right of a store owner to refuse service. Oh, we still claim to have it, we have signs saying that stores reserve the right to deny service and the like. But thanks largely to the civil rights movements of the 50s and 60s1, the ideal that store owners have an absolute right to refuse service is long gone, and in our litigious age that means a lot. So, where a shop keeper in the teens might have put out beer, and then told a teen who wanted to buy it "aren't you a little young? Beat it!" a shopkeeper today would worry that doing so would bring down the wrath of the local ambulance chaser. And, absurd as it sounds, some "children's rights" theories even support such ludicrous outcomes. Of course, in many places, in many shops, owners do just that anyway, but in general, the trend in our society is toward a requirement of absolutely equal treatment, meaning, unless a law restricts the access of the young, no one else can do so. And thus, today does differ from the past in one significant way2.

However, there is a second factor, one which exists today, as it did in the 19th and early 20th centuries, and one which is a very strong force, but a force we often forget.

So, for all those who ask how I will keep children from buying drugs or alcohol, I would ask who kept their children from having promiscuous sex? After all, all teens have access to sexual partners, they are alone at some point in time with members of the opposite sex, who stops them? Or who stopped them from violently attacking anyone with whom they disagreed? Or from consuming poisons? Or just eating food they shouldn't?

Parents.

I know, conservatives love to talk about making parents responsible for their children, and how the left wants the state to take over these responsibilities, but oddly, when I mention ending regulation of alcohol or drugs, they forget all about the role of parents and want the state to do it, just as the left does in other matters. It would be shocking were it not so common. It seems when it comes to one's pet peeve, to one's favorite cause, all of one's normal understanding of matters goes out the window, and arguments that one would reject out of hand on other issues become compelling in just this one instance.

Of course, I admit parents are not a perfect protection. Neither is the good judgment of store owners. But then again, neither is the state and its laws. Before we reject my answer because bad parents might not stop their kids, recall bad parents also buy their kids booze today, so neither is a perfect solution3. Similarly, shop keepers may be willing to sell to kids if there is no law, but today there are shop keepers selling to kids despite the law. Granted, today they can lose their license for doing so, but in a free market, angry parents can refuse to patronize them and have the same effect. Neither is perfect, but then again nothing is. What we need to discuss is what the effects of a law might be and whether or not it is more beneficial than harmful.

I did not intend to make this a debate about my arguments for ending prescription requirements, or restrictions on the sale of alcohol, but I suppose, to wrap up what I wrote above, I must offer at least a brief synopsis. So, controversial as they are, allow me to explain.

The prescription laws are easier to explain than the alcohol restrictions, mostly because they are far more extensive. Prescription laws quite clearly limit access, granting quasi-governmental power to doctors who allow or disallow access, and creating cartels of approved manufacturers, as well as government gate keepers who allow or disallow drugs entirely. It is relatively easy to see how this would result in raising prices, keeping useful drugs off the market, limiting choice, granting doctors power over their patients, requiring doctor visits for no purpose other than prescriptions imposing needless costs, and even introducing corrupt practices in the persuasion of doctors to favor certain labels, for drug companies to extend patents and the like. Not that all this takes place regularly, but the system favors these practices, and, even with honest practitioners, the cartel situation imposes needless added costs, as well as limiting access to medication4.

For all of these costs and potential costs, what is the benefit? I will leave out of the question narcotics and other drugs that are part of the war on drugs, as that is clearly even more contentious, and look only at things like antibiotics and decongestants. The argument goes that (1) patients would take drugs they don't need, (2) patients wouldn't see doctors when they should, (3) patients might overuse drugs and make them less effective and (4) patients might suffer adverse reactions. But all are nonsensical arguments, or, in one case, self serving.

First, patients might take drugs they don't need, but in truth, doctors do not prescribe perfectly either. From first hand experience, not only do they try solutions, just as anyone would, but they can overlook issues and even prescribe medications contraindicated for the patient's condition5. Of course doctors are likely to diagnose with more precision, to avoid the more unlikely diagnoses and to figure out the correct medicine more quickly,  (perhaps not in every case, but in the majority), but if patients are willing to accept a longer process, and more false starts, then why deny them that choice? If the patient is the only one who will suffer, and he accepts the consequences, then who is harmed?

Second, is the most self serving argument, that patients would not see doctors when they need to but for prescription requirements. I first heard this as a justification for keeping birth control pills prescription only (an argument that it obviously did not manage to support), and thought of how self serving it is. Of course, doctors may mean well, but it also has a terribly mercenary sound, requiring patients to come in to get their pills also helps to line doctors' pockets. But, mercenary or noble, the argument is still contrary to our own beliefs. Think of it this way, most people would probably benefit from professional advice on diet, we all eat somewhat unbalanced diets. So, should we refuse to let you buy food unless you have the permission of a dietician? Should we require your car be checked by a mechanic every 3 months or deny you the right to drive? If not, then the doctor argument should not hold water either.

Third, while sounding like a sensible concern, I would remind everyone that the incredible overuse of antibiotics and subsequent birth of resistant strains of bacteria came long after prescription laws were a nationwide phenomenon, meaning it was doctors (and to a degree farmers6) and not patients who overused those medicines. So, while patients might overuse a drug, it is not as if it could not happen with full prescription laws. Thus, it seems in this case prescription laws had no effect.

Finally, there is the issue of negative reactions. This sounds sensible at first, as doctors seem like the best people to anticipate bad reactions, but, having been given well over fifty different medications while being diagnosed for an unknown condition over six years, I can attest, not once did a doctor perform any test to see if I would react to a given medication, nor ask about likely contraindications, such as a history of high blood pressure, ulcers or anything else. Of course, some doctors may be more conscientious and ask, but how does that differ from putting a warning on the medicine? It is not as if doctors are performing extensive tests for compatibility, or administering the medicine in office and watching the reaction. They prescribe and send patients out into the world. So any side effects, whether for self-prescribed or doctor prescribed, will hit out of the blue and be handled by an emergency department. So how does maintaining prescription laws change this?

I could go on, but that was much more than I ever intended. Instead, let me touch the more contention part, liquor regulations, and then wrap this up.

The problem with liquor regulations is not as clear cut as that for prescriptions. It does not create a cartel of sellers, it limits access only in a single, and socially approved way, and generally seems a harmless regulation. And, were laws simply isolated points without any more influence, it would be. In fact, were laws nothing but beads strung together on a wire, independent entities without connection or influence on one another, then many of my arguments would be pointless. But laws are not independent, even when they are explicitly written so, with "line drawing" and protections against "slippery slopes" and the like, they still cast shadows, and the human mind, insisting on finding patterns, seeing consistency, and looking for reasons, cannot help but carry forward the logic embodied in a law. Which is why I continually argue against the use of government for anything other than its very limited purpose of protecting us against force, theft and fraud.

Seeing this law, and reasoning that it is proper for us to prevent children from buying alcohol for their own good, and perhaps to protect society from the harm drunken children might do, many will come to the conclusion that laws are justified if they can be shown to prevent a harm, or protect someone from his own bad decisions. At first, it will probably be used to make small, similar laws. Say, preventing those with a history of mental illness from buying guns, or limiting the sale of poisons to those licensed in their proper use. However, those laws will cast their own shadows. If it is ok to prevent the mentally ill from buying guns, and children from buying alcohol, why not keep felons from buying guns? And if that is good, why not require a license to own a gun, so we can tell who has one, and remove it if he commits a crime, or otherwise becomes ineligible?7 And then it goes on, and on8. From one single law, it takes very little imagination seeing the logic used to justify change after change. Of course, many who support it will argue that will not happen. this is just a common sense law, and it will not justify all that think it will9. But history shows otherwise. The commerce clause, the general welfare clause, Griswold growing into Roe and into many modern laws, Munn v Illinois growing into the massive bureaucracy of today? All of these seemed impossible to proponents of the original step, and yet they happened. Sadly, once the logic is established, it will eventually run its course. It is simply human nature.

And that, in a very sizable nutshell, is my problem with alcohol regulations. As with so many laws against which I argue, the goal is not in itself objectionable, but if we allow the law to stand, we risk having it used to justify many measures which would be harmful. Were there no other solution, or were the risk of harm sufficiently grave, then perhaps I would argue that we need to accept the risk, but in this case, as I have argued above, the law itself is not much superior to what came before, and thus I see not real need to offer a justification for limitless government to achieve these goals10.

Before I go, I suppose I should offer a few caveats here. First, I am not suggesting that eliminating these laws is an urgent matter, or even would appear high on my agenda, were I to be given total control over the state. I mention it here simply because it struck me as interesting that we seem to have forgotten in so many contexts the role parents play, and have, in many ways, even on the right, become so used to turning to the state to resolve every one of life's problems. Second, even were the world to move toward a smaller, less invasive government, as I wrote in "Reforms, Ideal and Real", I favor doing so through a federal system, with power kept as local as possible, and thus I imagine such laws would be handled on a state or even county basis. As the idea of less and less state interference spread, some may eliminate these laws to keep consistent with their beliefs, but I am sure many would not. So, I have no intention of fighting to end these laws, the alcohol ones even less than the prescription ones (which I have a remote hope of seeing ended if I live another century or so). However, I write not just about the practical and achievable, but also about the ideal and so I must mention these things if I am to be honest, and so I wrote this essay. I hardly expect broad support, and I have no intention for it to become a rallying cry for ending ID checks, I simply wanted to point out some other issues which it helped to illustrate quite well.
 
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1. I have often argued that the civil rights movement pursued a worthy goal in precisely the wrong way. I know for many it would not have been half as satisfying to eliminate government approved discrimination while allowing private stores and shops and restaurants to discriminate as they wished, but that would have been a solution consistent with individual rights. Much as we might deplore a belief, an individual has the right not just to hold that belief, but also to act upon it so long as he does not deprive another of life, liberty or property. By restricting this right we took steps toward destroying all effective freedom of association, as well as property rights as a whole. (See "In Defense of Discrimination", "A Statute of Limitations for Race", "How to Handle Idiots", "Back Again", "Best of the Web gets It Very, Very Wrong", "Private Versus Public Racism", "The Costs of Understanding", "Musings on Discrimination" and  "The Danger Inherent in Banning "Bad Ideas"".)

2. Obviously, if I were to envision my perfect government, my perfect state, this would not be the case, and so the elimination of the laws mentioned at the beginning would not be affected by this societal trend.

3. Oddly, it seems only free market, minimal government solutions are rejected for not being perfect, state solutions which fail to achieve perfection just need more money or power, or else just must be accepted despite their imperfections. It is a strange inversion, doing nothing requiring justification, while acting being assumed as the natural state. But then again, with a large government, and a public prone to ask the government to solve all problems, I suppose it is understandable. See "Action and Inaction", "Doing Something", ""Doing Something" Revisited",  "Doing Something Revisited, Again", "How Conservatives Defeat Themselves", "The Single Greatest Weakness",  "What We Deserve", "Who Is To Blame?", "Don't Blame the Politicians", "You Lose When You Think You Win", "Tyranny Without Tyrants", "Volunteer Fireman, Barn Raisings and Government",  ""...Then Who Would Do it?" ", "Collective Action and Government" and "Why Must The Government Do It? Part I", as well as "Rewarding Failure", "Third Best Economy", The Secret of Success, or, Why Government Fails", "How to Blame the Free Market, Part II" and "Government Quackery".

4. I covered much of this in "Medical Regulations", "Medical Regulation II" and "Gun Control, The FDA and Regulating the Law Abiding", among others.

5. I can swear that even after I was diagnosed with intermittent porphyria, I was twice prescribed medicines known to be trigger attacks of porphyria, resulting in intense pain, nausea, nerve damage and a host of other symptoms.  I do not mention this to malign doctors, simply to point out, that when they mention that patients may make mistakes, they too are capable of error.

6. Farmers because of their use of antibiotics on farm animals and the risk of some diseases mutating and moving between species. It is not as common as human to human transmission, and so the blame for the doctors is FAR greater, but as farmers are so often given a strangely elevated status ("The World's Oldest Myth", "Bad Economics Part 6", "Brief Thought on Voter Qualifications") I thought I would mention them in passing.

7. I use gun control as it is a cause most conservatives oppose, and so it makes a good, non-controversial example.  The same logic could be applied to protective tariffs, drug laws, price controls, safety laws, welfare, tax laws and anything at all. It is amazing how far a single example can reach. (Or perhaps not, given how much of our government perches atop the slender support of the commerce clause.)


8. See "Slippery Slopes", "With Good Intentions", "In The Most Favorable Light", "Inescapable Logic", "Recipe For Disaster", "The Endless Cycle of Intervention",  "The Cycle of Compassion" and "Grow or Die, The Inevitable Expansion of Everything" and "Inspections, Regulations and Bans".

9. See "The Lunacy of "Common Sense"", ""Seems About Right", Another Lesson in Common Sense and Its Futility", "A Look at Common Sense", "Res Ipsa Loquitur", "The Shortcomings of Pragmatism", "Pragmatism Revisited", "Pragmatism Revistied, Again", "The Plural of Anecdote is Not Data", "Rules of Grammar and Pragmatism", "The Problem of the Small Picture", "Keyhole Thinking", "Impractical Pragmatists", "In Defense of Zero Tolerance, or, An Examination of Law, Common Sense and Consistency", "No Dividing Line", "The Consequences of Bad Laws" and "Questions of Law and Questions of Fact".

10. I suppose I should add that I do not favor teenaged drinking, and that I think, in general, recreational drug use is a bad idea (though I probably find it less horrifying than most conservatives). I feel I must say this, as every time I suggest the government is the wrong tool to solve a problem people seem to assume I favor the problem that was supposedly being solved. So, I must explain that I am not in favor of this or that societal ill, I simply oppose the Swiss Army Knife/Panacea view of the state. As I have said before, if you tell me you are seeing your auto mechanic about your broken leg, and I suggest you go to a doctor instead, it does not mean I support broken legs (or oppose auto mechanics), simply that I think a different tool is proper for the problem. Similarly, if I think prostitution is not a question for government ("Tools", "Hard Cases Make Bad Law", "The Sexual Revolution and Prostitution", "Missionary Zeal and Human Discord", "Caution, Not Fear", "Three Types of Supporters of Big Government", "More Examples From Another Field", "The Difficulty of Principle") it does not mean I support prostitution, or oppose government, just that I believe social means are the appropriate solution, not forceful coercion.

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POSTSCRIPT

Writing this post, I realized I have definitely written more "libertarian" essays recently than I have in quite some time, and I seem more than that to have focused on issues where it is likely popular opinion, or at least much of conservative opinion, would be against me. I am not really sure why that is, but I definitely can see the pattern in retrospect. (Even more so when I include a handful of incomplete additional posts I did not publish.) I suppose in part it is because I have often avoided such topics, or at least treated them gingerly, so as to avoid needless conflicts that would distract from other topics about which I was more interested. Since I had neglected them so often, I built up quite a backlog of topics and I suppose it was inevitable they would eventually burst free.

Of course, there is nothing wrong with these essays, at least as far as I am concerned. While some may not be well received, neither are my arguments for absolutely unregulated banking, the gold standard, privatized roads, eliminating government from marriage, voluntary taxation or the elimination of all government safety regulations, yet I write on those topics (except the roads, that one gets stifled pretty regularly as well) fairly frequently. My conclusions on these topics, as should be clear from reading them, are completely consistent with my other beliefs. The basis on which I argue against gun control, against welfare, for a strong national defense and all the rest is the same basis upon which these arguments rest. They are an integral part of my beliefs. And that is why I have to address them sometime. Much as they may be controversial, and may conflict with many conservative beliefs, they are still topics which I must discuss and explain.

However, having now given them their head, having allowed them to run free, I think I am done with these topics for a while and will rein them in and pen them up once more. Drugs and alcohol and prostitution and pornography and the rest will go back into the darker recesses of my blog, mentioned only in passing, at least for a while. I am sure they will break free again some day, but for now I intend to go back to boring but acceptable topics such as money and commerce and foreign affairs and the rest.

Thanks for bearing with me while I explored the less generally accepted elements of my theories of government.


Sunday, January 20, 2013

The Problem With Microeconomics

I have written extensively on the impossibility of "scientifically" managing the economy. ("The Limits of Technocracy", "Technocrats", "The Limits of Econometrics", "The Limits of "Scientific" Management", "Knowing Our Limits", "Greed Versus Evil", "Some Additional Thoughts on Technocrats", "A Thought on Technology and Technocrats") As I have shown, though many theories that seek to replace the free market suppose such a thing is possible, there are a legion of problems. ("Competition", "Big Box Stores and "The Climate of Greed"", "Moral For Me, But Not For Thee", "Symmetry and Greed", "Cutting "Costs"", "Misunderstanding Profits", "Two Examples of "Inefficiency" in Capitalism", "Third Best Economy", "Mistaken Perceptions of the Industrial Age", "A New Look At Intervention") Some are a bit more abstract than others, but, even on the most basic level, when you begin to think about the issues, the problems simply multiply until it becomes obvious that accurate prediction is impossible. There is also one additional issue, which i shall discuss at the end, which is unrelated to prediction, but for now let us look at the numerical problems.

The first, and greatest problem is with the basic assumption of the supply-demand curve model. Such models are unobjectionable as teaching tools, as they show, in a general way, the interaction of price, cost and amount offered/demanded. They can also demonstrate many useful concepts such as marginal utility. However, they are simply that, useful teaching tools. They cannot be determined in reality.

Allow me to draw an analogy. In history, we often speak of something being the cause of an event. For example, the assassination of Archduke Franz Ferdinand caused the First World War. However, historians are often warned of pursuing this idea too far, that is developing "what if" premises, trying to decide if but for that assassination the war would not have come about, or when it would have broken out had the archduke survived. Sometimes fiction writers, or pop historians, will play with these concepts, but serious historians know there is no value to such thoughts, we cannot "rerun" history over and over to determine the paths it would have taken if things had been different.

Economists seem to have not learned this lesson. These supply curves and demand curves are nothing but historical data, and worse, they are formed from disparate historical data. If we know on July 1, 2001 a price of $X provided a supply of Y items, and on July 2, 2001 a price of $A provided a supply of B items, that does not give us two points on a single curve, but one point each on two different curves. The problem is that individual valuations change from second to second. I may want a potato very much right now, but if I eat one, I may not want one at all in a few more minutes. Or, maybe, even without eating one, I may change my mind, and desire bread instead. When we combine all the moment to moment changes of every individual, we can see that, were we able to determine an instantaneous demand curve, it would writhe about like a snake from second to second.However, working from disparate points drawn one at a time from different periods, economists imagine they have approximated the actual supply and demand curves.

It should be obvious this is a completely invalid methodology, likely to produce absolutely nothing meaningful. Even if we allow for some sort of statistical sampling, and assume it is close enough to the truth, the problem remains that the true curve at any given moment always deviates from this average, meaning that claims of precision fall rather flat. Not to mention that the change sin such curves are often not minor fluctuations, especially over longer periods of days or weeks, but the curves can change dramatically, making both the supposed sampling method near useless, not to mention meaning that any sample is far from likely to come close to the actual curve at any moment.

But for the moment, let us disregard this problem, monumental as it may be, and assume somehow we can magically determine an instantaneous set of supply and demand curves. It is, of course, completely impossible, as you cannot set every price at a given instant to determine the relative demand, not to mention accounting for the reaction of volitional beings to changes in price, but, for the sake of argument, let us assume it is possible. It is then that we run into the "cet par" problem.

I mentioned this before in my essay "Fiscal Discipline", where I discussed the fact that every economic model assumes that when any change is made, everything else holds constant. However, that is the problem. In real life, the other values do not hold still. If, for example, potatoes rise in price, it will not just change the price for potatoes. People will begin buying more of substitutes, driving up the demand for those, and thus increasing price, causing potatoes to once again be competitive alternatives, resulting in a series of back and forth shifts between the higher priced good and potential substitutes.

Nor is that all. Goods which use potatoes as a component, such as french fries, mashed potatoes, stew and many others will also rise in price. As they rise, this will change demand for a host of other goods. For example, as potato bread becomes more expensive, wheat bread will be in higher demand. As stew rises in price, demand will fall, not just for stew, but for things people like to eat accompanying stew, say, biscuits. As these prices change, they will later the prices of substitutes for them, which will change yet more prices, and, in the end, the single price change will cause ripples which will stretch out throughout the economy, and back again, changing prices in unpredictable ways.

I suppose it is conceivable that some incredibly complex set of models, run on some unimaginably powerful computer, could take all of this into account and produce a prediction of the outcome of a single change in price. Maybe. Assuming that supply and demand curves were reliable, could e determined, and did not change with time. However, even such a model would not be adequate to reproduce reality. After all, humans are not limited to shifting money between existing options. They can also make unexpected choices. For example, when whale oil rose in price, and supply began to dwindle, it brought about the birth of the petroleum industry, which until that time existed in no economic model.Or people could react in unexpected ways, such as the trend during the past few decades for western nations to import previously ignored grains from distant countries, such as quinoa and tef. While there were probably part of economic models for other nations, they were largely ignored in the west, but now form a considerable share of the market. All of this is, obviously, part of the problem of basing models upon historical data, the new and unexpected cannot be modeled, but it also shows that mechanistic models are not good predictors of action by volitional entities.

Then there is another issue, which may not always play a role, but which does come into play more often than many admit, and that is the role of expectations, that is the ability of humans to form expectations about the future. For example, a model may predict a $1 drop in the price of jeans will result in a 10% increase in demand. However,  that may not work. For example, if the price has dropped more than once, buyers may believe sales are bad and begin to anticipate additional drops in price, and thus a drop in price may actually result in reduced demand as buyers await additional drops. (This process, in a very different form, was mentioned in my essays on inflation, concerning the tendency of inflationary price increases to race ahead of growth of money supply due to the same pressures -see "Inflation and Uncertainty", "Bad Economics Part 7", "Bad Economics Part 8", "What Is Money? ", "What Is A Dollar?", "The Gold Question, Not "Why?" But "When?"", "Monetary Issues Made Simple Part I", "Monetary Issues Made Simple Part II" and "Stupid Quote of the Day (January 7, 2012)".) And, of course, outside factors, beyond the model, can also play a role, for example prior to Christmas it becomes likely that price changes will have much less impact than at other times of year. First, because those with a fixed list of gifts to buy will likely buy them regardless of price. Second, because those buying on impulse are more likely to wait to purchase during anticipated post Christmas sales. It may be possible to try to model such behavior, but it is rather difficult as what constitutes "near Christmas" is subjective enough that individual opinion changes form year to year, making even historical data relatively worthless.

There are likely more issues that could be raised, but rather than continue to pile on examples, let me instead close by explaining the other significant issue I mentioned in the open of this essay. And that is the problem underlying all questions of supposed scientific management, and that is the question of the goals one is to pursue. All of the people who propose these scientific models of management tend to emphasize supposed "weaknesses" in the free market, or highlight the "waste" they find, but in the end, they tend to fall back upon the belief that what individuals pursue when left to their own devices is simply not what they "should", that they want things that are bad for them. The problem being, by what definition? The economy, for better or worse, is a collaborative venture individuals enter to improve their own satisfaction. As soon as you start thwarting their desires, and imposing some other will, the system begins to fail. People have less and less incentive to work, are less and less satisfied, and in the end, the combination of lack of incentive and dissatisfaction with outcomes will result in individuals giving up. Thus, for better or worse, using the economy to enforce one individual's view of what is right and good is simply a recipe for destroying the economy. (See "Competition", "The Basics", "The Case for Small Government" and "The Inherent Disappointment of Authoritarianism".)

Paradoxical Outcome

In discussing gun control laws, the second amendment is often held forth as our best protection against government attacks on our rights. And, given the circumstances of the present day, perhaps it is. And no doubt, the founders, well aware of Cromwell era attempts to disarm private citizens, were wary of leaving the issue unmentioned. After all, many state constitutions contained similar provisions, inspired by similar worried memories, so it probably seemed natural, in enumerating the rights to be protected, that there should be provision to allow citizens a full and effective right of self defense.

On the other hand, the second amendment, in many way, actually sets the stage for the very worries it tries to assuage. While it explicitly lays out a protection, it is possible, in so doing, it creates more problems than it resolves.

Nor is this thought that unusual, and certainly not unique to me. During the ratification of the constitution, several states worried that the limitations placed upon the federal government, restrictions against various actions, might be read to mean that all other actions were allowed to the federal government, and thus insisted it be recognized that such limitations were by way of emphasis and that the government had granted to it only those specific enumerated powers, and no others. (Actually, if we view it in this light, the second amendment itself is one such superfluous limitation, as no power explicitly granted in the constitution would allow the federal government to deprive citizens of the right to bear arms, making it a somewhat pointless limitation.)

But that is not precisely what concerns me about the second amendment. While it implies, in a way, that but for this amendment the federal government might have the right to limit arms, that is a smaller concern than the one in my thoughts. You see, my concern is much more fundamental. In distinguishing "arms" as a special category, with special legal protections, it creates the impression that arms are inherently different from all other goods, and thus can be subjected to special legislation. And it is that act of distinguishing arms as worthy of special attention that concerns me.

While arms have, in some historical cases, been subjected to special legal action, that does not mean that they must always be so. In the past religious thought was differentiated from secular thought, for example, and yet our law does not provide for special protection of speech based upon the content being religious or secular. So, there is no inherent need to differentiate arms from other goods.

If we legally dealt with guns as we do all other goods, treating all commerce as equal, and all property rights as indistinguishable, then it would be difficult to enact anything like modern gun laws, as I doubt anyone would accept a week long waiting period on every commercial transaction, from buying a gun to ordering a Big Mac.

Of course, the modern state would never accept such a law, as so much rests upon segregating goods into infinite subsets, each subject to its own regulation and restrictions, but that is precisely my point. If we were to treat all property identically, and transactions of equal value, limiting our government to passing laws that affected all goods and transactions, or none, the government would have a hard time enacting half the laws it does, as much of its regulatory scheme presently relies upon finding group after group to blame and scapegoat, subjecting them to cumbersome regulation. If such regulations had to be universal or not exist, then it is doubtful any such laws would pass.

I am certain some will come up with necessary exceptions, at least exceptions they think necessary. And, perhaps, there may be some cases in which making such a distinction would seem to make life better. However, I would much rather forgo a few such advantages, if in the end, we were spared the massive regulatory apparatus that presently exists.

In truth, I would prefer to eliminate all such laws, and leave the state out of voluntary commercial transactions entirely, but as a step in the right direction, I think it would considerably improve our lot were the state limited to treating all property identically. Until we remove the state from all voluntary exchanges and all questions of property, this is a best answer than any we presently have.

POSTSCRIPT

Someone will doubtless ask, if I believe anyone can own anything, would I allow private citizens nuclear bombs, and the answer is "yes", but, before anyone complains allow me to ask a few questions. First, does anyone seriously believe there will be a consumer market in nuclear weapons? Somehow, given the cost per use, the relatively few recreational uses, and the impracticality for self-defense, I don't see it becoming a status symbol anytime soon. In addition, does anyone think that a person with enough money to buy one, who truly wants such a bomb today, could not find one? Granted, it would be inconvenient, but enough nuclear capable countries with sketchy ethics exist today that anyone who could afford it probably could be so armed. So what would be different? For that matter, given enough time, enough knowledge, and a burning desire, it is likely someone could eventually piece together a very low yield bomb without assistance. After all, radiation is universal, radioactive materials are distributed pretty evenly through nature. It is not financially viable to recover uranium from ordinary soil or other sources, but that does not mean a truly committed nutcase  could not do so, it would just take a lot of time and effort. Granted, it would not compare to military bombs, but I doubt that matters to the sort who would do this. And so, in reality, legal bans on nuclear weapons are rather pointless as it is, so what is lost by removing the government from all matters of property? Nothing but a prohibition which has very little impact in the real world.

Saturday, January 19, 2013

Sorry for the Silence

My apologies for the longer than usual silence. It seems work was even busier than anticipated. And, in addition, I simply haven't been particularly inspired to write of late. not sure why, but I seem to have less energy than usual when it comes to writing for this blog. Still, I expect in the next few days I will be posting something, so please check back.

Tuesday, January 15, 2013

The "Liberal Bubble" Becomes Universal

I have commented before on the birth of what I dubbed the "Angry Right", that being the right's version of the "Angry Left", a philosophy which sees everyone outside of the conservative movement as incurably corrupt and hostile, which ascribes every left wing belief to intentional villainy, and which generally has turned the right into a mirror image of the leftist views inherited from 60's radicals, a defensive, insular, "bunker" type mentality, where you are one of "us" or an enemy, and the only hope is to outlast the other side.

It is, as I have argued, a self-defeating philosophy. It was the rise of this belief on the left, especially as the 60's radicals drifted into the mainstream of the party and spread their beliefs, that slowed the leftward drift of the 60's and 70's, allowing the Reagan-Bush victories, as Reagan reached out to the center, while the left remained convinced of the obvious superiority of their beliefs and either dismissed or ridiculed any who saw differently. Similarly, Gore's tantrum of 2000, and the subsequent growth of the "Angry Left" definitely played a part in the Republican victories of 2002 and 2004, and even ameliorated the losses of 2006. Considering how weak many of the candidates offered in those elections were (including Bush himself),I could argue the left's posture played a considerable role.

But why would the left adopt such a philosophy? It would seem clear to me, and should to others, that a political party which basically tells all outsiders they are foolish, wrong or evil would be a losing bet, since the hope of recruiting new members is relatively small, as is the chance of gaining any crossover votes. Unless the party represents a clear majority, the platform the Angry Left embraced seems a recipe for extinction.

That is where the oft mentioned liberal bubble comes into things. Stretching back to the famous "No one I know voted for Nixon" quote, it has been a popular topic on the right. And it is largely true. The northeast, for the most part, and swaths of the west coast, along with a number of large cities in the Ohio Valley and pockets throughout the rest of the country (eg. Austin, Ann Arbor), are so solidly liberal that such a philosophy is considered unobjectionable. These are places where stating "all intelligent people are liberal" will gain nothing but knowing nods. Even in mixed states, such as my native Maryland, the conservative regions are largely geographically discrete, leaving liberals living within regional bubbles.

The problem, as I see it, is that conservatives seem to be suffering the same fate of late. For many it is just as geographic as the liberal bubbles are, but for others it is personal. They may live in largely liberal areas, but thanks to their mindset, their choice of jobs, or friends, they manage to encapsulate themselves in a conservative bubble, where everyone to whom they speak, at leats about political matters, is of a like mind.

In some ways this is inevitable. Living in a very liberal state (for the most part), and working in a liberal city in a job traditionally even more liberal, I find myself reluctant to discuss politics. And many conservative are the same. Until recently, conservatives were generally not likely to take liberal statements badly, but many liberals reacted to conservative beliefs with offense, or condescension. And so we conservatives kept to ourselves, and, as result, created our own conservative bubble.

Which would not be a problem, were it not for the growth of the Angry Right. Back in the 80's, when we treated liberals as softhearted, softheaded fools, and tended to chuckle at them, or ascribe their beliefs to immaturity or other mistakes, it was not a problem that we were so isolated.  Our belief forced on us a frequent recourse to a sort of evangelism. We might not have discussed politics readily, but when the opportunity presented itself, we were happy to try to show others the error of their ways.

Now, with so many ascribing liberalism not to foolishness, but to malice, finding in every left wing belief a secret agenda to intentionally cause human suffering, enslave others and generally destroy mankind, it is easy for us to forget about ever reaching out and instead to stay isolated in our little bubbles, holding out against the outside world until, somehow, our side just miraculously wins.

The problem with this approach should be obvious. With neither side reaching out, the game goes to  he who gains the most recruits, and with the society so firmly in the grip of liberal media, liberal education and a generally liberal pop culture, once young people become liberals (which they tend to do frequently -- see "The Path of Least Resistance") they are unlikely to ever come back to conservative principles. And so, if we maintain our Angry Right beliefs, we are dooming ourselves.

What we need is a change of heart. We need to stop seeing everyone with whom we disagree, even die hard liberals, as villains, as monsters seeking to destroy us. We need to ask ourselves if maybe, just maybe, many of them might not be evil, but simply misled. And if so, is it not our responsibility to offer them  a choice, an alternative? It may not be a quick fix, it may take a long time, but if we become the party that reaches out, that tries to persuade, while the left remains insular and hostile, we might find that it pays off great dividends in years to come.

POSTSCRIPT

I have amde similar arguments before, see "Misguided, Deceptive or Evil?", "Tyranny Without Tyrants", "Three Versions of Evil and the Confusion They Cause", "Life Without Villains", "Enemies Into Villains", "Rethinking My Earlier Position", "A Small Digression" and "In Defense of Civil Debate".

POSTSCRIPT II

In some ways I think this was inspired by a few personal experiences. First, and most prominently, my often mentioned debates with my extremely liberal (though inconsistently so) mother. Obviously, I cannot think of my mother as  a sinister mastermind trying to destroy mankind, so I must instead view her liberalism as nothing but a political belief, and have to ask why she holds those beliefs. Given that, I have been forced to admit to myself that other liberals, even prominent ones, might be the same as she is, people who simply hold beliefs with which I disagree. Second, my own experience at having been an actual communist in my late teens and early twenties, and not just the trendy "Occupy movement" kind, but a bookish boy who read Marx and Bakunin and Saint-Simon and their ilk, and bought into it all, at least until I was exposed to those who could point out the logical flaws in those beliefs. I know I had no hope of destroying mankind, that my beliefs were motivated by a desire to do what was right, and so, again, it is quite possible that other liberals, even those with extreme views are the same. Finally, one of Maryland's former governors, one who I have criticized pretty frequently, is a parent at my son's school. And, despite our political differences, the times we have talked, he has proved to be a nice fellow, a good parent and a generally decent person. Of course, I suppose it could all be an act, a disguise he puts on when he leaves his secret lair to walk among us, but I think not. So, again, I must admit that liberals can be simply ordinary people who happen to have different views.

Now, some will say they do not deny this, they don't think liberals are evil, they just worry about their beliefs. However, that is not how the climate appears. Think about how often conservatives look for hidden socialist motives for simple liberal actions. How often they accuse them of intentionally ruining the economy, intentionally stealing freedoms and the like. It happens so often it has become habit. I myself have been guilty of it, despite knowing better. Yes, I will confess there are sometimes those with other agendas, and may even be a few with the intent to reduce our freedoms and the like. (I tend to worry about those environmentalists who talk about "too many people" or those who refuse to consider "technological solutions", but I also admit most rank and file environmentalists are probably sincere, mean man no harm and mean what they say). In the end, even actions which we find sinister, such as disarming the public, are intended for the very purposes claimed, because the left thinks removing guns will make us safe, and not as a precursor to armed takeover.

Unfortunately, our tendency to see government as a "necessary evil" and to worry about loss of freedom tends to make us think that is intentional. In truth, I fear most expansions of government, most losses of freedom, and the rest, are not intentional acts of evil, but simply the logical outcomes of bad philosophies ("With Good Intentions", "In The Most Favorable Light", "Grow or Die, The Inevitable Expansion of Everything ", " "The Threat of Perfection ", "Utopianism and Disaster", "Greed Versus Evil", "In Praise of Contracts", "Recipe For Disaster", "The Endless Cycle of Intervention",  "The Cycle of Compassion", "The Inevitable Corruption of Protectionism", "An End to War", "Fear Driven Enterprises" and "The Inevitability of Bureaucratic Management in Government Enterprises"). And we should recognize this. We still need to guard our freedoms, but against those who wish us well far more often than those who mean us harm.