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Why Not Change Our Tax Structure To Punish Extra-Market Coercion?

Paul Krugman writes:

Soros, Obama, And Me
What do we have in common? We’re all small business owners, according to Mitch McConnell. Obama and I make our business income off books — he sells the audacity of hope, Robin and I sell the misery of Econ 101; Soros makes his money off financial destruction directing funds to their most productive use; but we’re all in the same category as the owner of a small factory.

Small business people? Hardly. That writing provides a limited return is not a measure of its level of consumption by a large number of customers, but a measure of how little people are willing to pay for it.

The term Mitch is looking for is not “entrepreneur” it is “[glossary:Schumpeterian Intellectuals]”: people who bring about the destruction of capitalism, the market, and the prosperity of national competitiveness by undermining both the sentiment of, and capital structure of entrepreneurship.

[callout]Then, perhaps some of us should put our capital stock of violence to better use, if in our restraint, we are disabused by men who simply take advantage of our creation – the market. It would be the optimum use of our asset.[/callout]

Unfortunately, we don’t have special taxes for Shumpeterian market destroyers like we have special taxes on entrepreneurial market creators. But we can fix that. Perhaps we should level the playing field by heavily taxing political, extra-market goods and services, and lowering taxes on apolitical intra-market goods and services? Wouldn’t that be a switch? I mean, why should the amount of income be the axis of measurement, rather than the service provided to the market? Under that measure we could confiscate all of Soros’ money, recover our losses from the bloated financial sector, and reduce the media to non-profit status, and make political writing an unprofitable exercise.

As for putting capital to a better purpose, that’s not yet proven. Soros was not participating in the market for goods and services by creating unemployment and reorganizing that capital for his use. He’s just using remunerative coercion under state protections. And extra-market remunerative coercion at that. A form of coercion made possible only by the restraint of violence by others in order to create the somewhat free market – a restraint he does not himself employ. And while that asymmetry of restraint may not be apparent to your cult of those who are incapable of holding territory and trade routes, or building an durable government, or durable institutions of calculation and cooperation, it is not lost on those of us whose ancestors have done so for a millennia or more.

It seems odd to me that so many people fail to grasp just how entertaining and enjoyable civil war is for those people who practice militial restraint – often at high personal [glossary:forgone opportunity cost]. Modern war is a ‘hell’ only for people who fight in the western model. It’s not for warriors, terrorists and raiders. We forget that the reason we cannot conquer the Afghans is in no small part because raiding and killing are actually enjoyable, entertaining, status-enhancing pass times among practitioners. And creating markets and property rights, and philosophy and econometrics, is a poor substitute.

Then, perhaps some of us should put our capital stock of violence to better use, if in our restraint, we are disabused by men who simply take advantage of our creation – the market. It would be the optimum use of our asset.

Or those who put their financial capital stock, or political capital stock to such extra-market or Schumpeterian Intellectual purposes, could pay the opportunity cost of restraint, so that we do not have put our stock of violence to extra-market uses. So that we can continue to devote our energies to the proxy of entrepreneurship instead of the more enjoyable and rewarding uses of our capital stock of violence. Why should we simply transfer our capital at a discount from a stock of market making violence to a stock of market destroying verbal and political coercive uses, or remunerative extra-market coercive uses.

After all, violence is far more coercive. And much more rewarding.

🙂

Cheers

See [glossary:three coercive technologies].

The depth of this insult is probalby accessible to only a few people. But I have to say this is one of my favorite little essays of late. – Curt

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A Method For Moderating Dialogs

“The Cult Of Offensive Moderation”

Note: I am in the process of creating a plugin for political moderation of debates, without censorship.

There is far too much censorship on debate sites and blogs. Especially censorship of in-group language. The sentiment of inclusion in Democratic Secular Humanism (our current religion in the west) is at odds with the change in our word-wide status and economic position as a polity. In-grop sentiments are becoming increasingly important again.

[callout]Solution? Categorize posts in a debate as to whether they are:
1) content free or off topic
2) sentimental expressions
3) mythical, Platonic, or scriptural reasoning
4) Objective rational arguments
5) scientific arguments (using survey data but which are very fragile in the social sciences) and
6) economic arguments (which because of scale and aggregation allow cultural comparison.)
If you could filter conversations by these arguments,the reader could participate in a conversation of his own level of capacity.[/callout]

1) The strategy of moderating sentimental (non rational) expressions will not work, because it leads to regression – increasing sensitivity as a means of ostracizing people to the point where commenting becomes more an act of policing until the board declines. It increase the transaction cost of participation.

2) As someone who runs a large advertising agency that must help companies and groups understand ‘social interaction’, I spend a great deal of time trying to educate editorials that the ONLY thing people find interesting is CONFLICT. Talking head shows are either internally engaging in conflict (crossfire), or externally (oprah/hannity). Conflict leads to ratings and ratings to participation. WIthout conflict, in either a novel, sort story, or a talk show, there isn’t much to hold anyone’s attention. And the more attention that you hold (the more viewpoints included) the more likely one is to have a member of the audience identify with one of the participants, and become involved.

3) People learn by first identifying the SENTIMENTAL statements that they agree with, and then seeing those statements refuted. If you eliminate the religious nuts, or the racists, or the culture-ists, you’re actually killing off the social value as well as the attraction of your medium. Because all people operate by sentiments. They may learn to articulate those sentiments as mythology, as reason, as science, or as economics, but they are still, almost universally, articulating their sentiments – simply with a different degree of precision.

4) Personalities (contributors) cannot be allowed take over the board or its brand and become the show itself. That’s board-hijacking, rather than thread-hijacking. So if you have permanent troublemakers that begin to draw too much attention to themselves then it is better to heavily moderate them. But not because of the content and form of their arguments. You ban them because they dominate the conversation and make their own ‘show’ on your dime. Losing participants is dangerous for any medium. Even bad ones. Sanitizing a board usually ends up with no board at all.

5) Increasing the number of editors so that they split posts into new threads is better than banning or correcting. Remember – people are largely seeking attention for their niche fantasies. Ignoring people is the most effective means of negative reinforcement.

6) Sentiments (unarticulated expression) are the most common form of narrative. They are analogical arguments. Reason (to the degree that few people can actually articulate causal properties of categories), science (directly measurable subsets) and economics (indirectly measured supersets). Religion as we mean it, refers to scriptural command, or external non-human knowledge, in the monotheistic meaning. Polytheism and history are simply differences of degree. It is scripture.

7) it is particularly troubling to eliminate what is called hate-speech or inter-group expression of sentiments. That ‘s because the most important dialog of our age is the change in group sentiments now that the worldwide change in status and power hierarchies has come about because of the worldwide adoption of western economic and material technologies.

SOLUTION?

Editing and moderating are hard. It is very, very, difficult to ascertain the quality of an argument in the social sciences. We are fairly sure that the entire Marxist religion, masquerading as a political movement, is as irrational as the Islamic political movement masquerading as a religion, are both extremely dangerous to mankind. But since we live in a POLITY, and the member of that polity largely use SENTIMENTS rather than reason in debate, and that their beliefs and debates are highly influential upon the outcome (more than reason by a long shot), and that most people criticizing these sentimental arguments lack causal depth in their own arguments, then the best board, the best discussions, the best social outcome, is determined by keeping an argument on track, rather than censoring it.

An alternate solution, (and I have done a little work on this) categorizing posts in a debate as to whether they are 1) content free or off topic 2) sentimental expressions 3) mythical, Platonic, or scriptural reasoning 4) Objective rational arguments 5) scientific arguments (using survey data but which are very fragile in the social sciences) and 6) economic arguments (which because of scale and aggregation allow cultural comparison.) If you could filter conversations by these arguments, you would be able to stack them by methodology, and the reader could participate in a conversation of his own level of capacity.

DIFFERENT IDEOLOGIES

Although, we should note, that as scripture, you will have a hard time actually arguing against catholic doctrine as it’s based upon natural law: the observation of what men actually do. WHich is, what appears to be, the general sentiment and strategy underlying most semi scientific argument on this board. (Which I admire).

If you want to argue using reason, the libertarian methodology will most likely lead you to correct conclusions. However, libertarianism consists of a set of branches, some of which do NOT correspond to reality, including 1) Rothbard’s principle of non-violence which is a silly argument, since the entire problem of social order is non-violence 2) free trade would lead in the end, to as state of affairs not any different from world-governance 3) libertarians have not included the cost-of-forgone-opportunities which is how we pay for the creation of some set of property rights, and therefore, failed to account for the cost of developing social order. As such, it’s a platonic fantasy counter to evidence.

Conservatism is the best strategy for preventing social destruction, revolution and un-meritous rotation of elites. It is very skeptical of power – power should be obtained by public service in the market, or in the military in the defense of the market. Any other grab at power is specious. That’s the sentimental origin of the western city-market building shareholder system we call ‘citizenship’. But conservative philosophy has not provided a solution to our vast increase in the division of knowledge and labor. It has not provided us with an updated set of institutions for the contemporary world.

And FWIW : Conservatism is largely an unarticulated sentiment that is more complex than left-liberalism, as conservatives rely on at least five axis the most important of which is group persistence, and liberals only one (harm/care). The combination of harm/care simplicity, egalitarian equality, Keynesian macroeconomic policy (statistics, full employment, liquidity) and democratic government, are ideal tools for competing with a sentiment thats primary purpose is to avoid hubris, and protect the group for the long term. In other words, consumption on the left versus capitalization on the right.

[callout]The balance between liberalism (Pareto’s Instinct for Recombination, or Machiavelli’s Foxes) and conservatism (Pareto’s Preservation of Aggregates, or Machiavelli’s Lions) is a necessary conflict between the forces of stability that must allow change, but not disruption, and those that desire change regardless of consequences – because both innovation and stability are valuable to a civilization This debate in sentiments is particularly useful because reason is insufficient for solving this problem, largely because we have failed to make the same progress in induction and the social sciences that we have in deduction and the physical sciences. And partly because the physical sciences are vastly less complex than the more heuristic social science governed by the properties of the human mind.[/callout]

The balance between liberalism (Pareto’s Instinct for Recombination, or Machiavelli’s Foxes) and conservatism (Pareto’s Preservation of Aggregates, or Machiavelli’s Lions) is a necessary conflict between the forces of stability that must allow change, but not disruption, and those that desire change regardless of consequences – because both innovation and stability are valuable to a civilization This debate in sentiments is particularly useful because reason is insufficient for solving this problem, largely because we have failed to make the same progress in induction and the social sciences that we have in deduction and the physical sciences. Partly because the physical sciences are vastly less complex than the more heuristic social science governed by the properties of the human mind.

And just so we’re all living in rational reality not committing the error of confusing our own religion with neutral objective science, much of what is argued for on this board by well meaning products of our the past sixty years of western educational system, most often is doctrine of the RELIGION of Democratic Secular Humanism (which is a religion as it is contrary to the facts). Or of egalitarian equality, which is is a property of the Democratic Secular Humanist religion, and is also contrary to the facts. Or the assumption that freedom is the desire of the majority is counter to the facts.

That is, as long as we realize that people are racist, culture-ist, class-ist, nationalist, cultist, members of competing civilizations, and they all are, because they all act that way under DURESS, and that it’s advantageous both for elites and for the underclass to be ‘anything-ist’, and that these traits are beneficial to economic man, beneficial to individuals, and an enduring part of the human experience. And if one doesn’t think so, then truth isn’t one’s objective, platonism is. Truth is correspondence with reality.

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The Child Of Democracy And Secularism Is Stillborn

(Posted in the comments section of the NYT)

In response to the comments section of one of Paul Krugman’s articles: British Decline

I felt that all the people that were commenting were right. They understood the failure of conservative policy. The same way that conservatives understand the failure of liberal policy. But they are working on different axis. Neither to do with one another.

Our ideological war has now become a race and class war. New elites are emerging. They are less invested in the previous order. They are messianic. They are driven by the one force that is unstoppable: the loss of status and power, which no group will tolerate, and which whites only tolerated because of the combined guilt of slavery and colonialism, and the attack on men by feminism. The elites widthrew from society, participated in the commercial marketplace, left the arts to immigrants, and abandoned high culture. This was fine until the middle class was threatened. At this point, not only is the middle class threatened but so are the working class whites.

Under duress people rely upon the mirror test: people who look like them. They are under duress economically. And they feel that their government, the very government that they surrendered, is against them. The ascendency of europeans and the protestant reformation is being undone. Classical liberalism is being undone. It is being undone for exactly the reasons conservatives stated it would be undone. The inability of conservatives to produce a cult (romanticism) and the abilty of conservatives to produce an economic and political model to compete with socialism and social-democracy, using the tools of monetary policy, and the state, to transfer power and advantage.

RE: “Japan has a big asset: a leadership that honestly cares for its people. This caring (amateur sociology, according to professional economist), is due to their tribal unity.”

This comment correctly states the issue: that despite hardship and demographic changes, the japanese remain under solidarity.

[callout]Neither side wins. Period. We all lose. A nation is its cult. Economics is not a sufficient means of organizing a polity. Democracy wasn’t the only god that failed. It married secularism. And it’s child is stillborn.[/callout]

This is scientific data, not amateur sociology: The japanese are a homogenous racist society. Economic success by any group will not lead to political disenfranchisement of another group, wherein the dominant group will lose privilege and opportunity, or the competing groups will not eliminate but simply alter the baises of privilege and opportunity.

The USA is an empire. People of different races, cultures and religions, do not mix except under very rare circumstances at the margins, largely to do with status economies and the resulting access to mates and opportunities. The human accounting system is status, not money. Because intra-group status is more rewarding than extra-group status.

We will not have multi-culturalism when different groups have the ability to obtain political power, and can undermine the majority status system. There was far more multi-culturalism under the great monarchies of europe than today. Simply because commercial excellence was the only status route available to minorities, because the political system was not open to them. Power is not meritocratic. It just is power, and the most important objective of power is to deprive other people of it. And the most important feature of western culture was that it allowed status gain by market activity even if denied access to political office which might alter that dichotomy.

The conservative movement was a reaction to a violation of its core principle of long term group cohesion – a necessary component of land holding and trade-route holding – persistence which cannot be maintained through economic means alone. Only tribalism and pure military strength are strong enough to hold trade routes. THe conservative movement since the end of the war was a reaction against the disintegration of the sentiments of group-persistence, due to immigration, post-slavery political problems, feminism and anti-colonialism, as a coalition against the established political order. And instead of obtaining their ‘rights as englishmen’ of property, and market participation, these groups sought political power – political power is not meritocratic. It is just force.

This process s playing out, and will play out, as materially important and highly predictive. Our culture will not assimilate and unify. It will not achieve the grand vision. We are demographically adopting the south american model. We will, and are, fragmenting to the point where the government may lose the ability to govern. If we get only two states to make use of nullification that will be the end of our multi-cultural, melting-pot fantasy. And three more years of low employment will almost guarantee it.

Good economics is not macro economics. All economics is micro. Because the vast movement of human beings over time is determined by what they cannot sense by quantitative means, and what they can sense by qualitative means: the loss of their status and opportunity due to enforced competition, and competition from people who are no longer asked to integrate and to be ‘american’ and adopt american values, but to oppose those values and retain their culture at any cost, because en-masse, it is a way to obtain political power, rather than participate in the market and become an american by earning status in the market.

All your criticisms of the free trade movement are correct. Conservatives were attempting to preserve the cult of american classical liberalism, preserve existing status hierarchies, and force people to conform to that value system – their cult – and therefore force people into the market under the monarchic classical liberal model. THe conservative policies that you are railing against are simply means of undermining the attack on the classical liberal cultural order. Justified as economic nonsense maybe. But pursued for precisely conservative reasons.

Neither side wins. Period. We all lose. A nation is its cult. Because economics is not a sufficient means of decision making in a polity. Democracy wasn’t the only god that failed. It married secularism. And it’s child is stillborn.

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Anarchists and Elitism?

From The Liberty Defense League, an exceptionally intelligent posting on the weaknesses of anarchism.

Some libertarian friends call for anarchy to prevail. While such a state of affairs may be offering momentary delights, we need to remember that if we stand for nothing, we will fall for anything. Anarchy is government of nothing, and is only a transitional period between different states of order. Order always arises from chaos, and anarchy is often a tool of leftists. I am sure true libertarians are well meaning in upholding individuals’ self-rule in looking to a utopian anarchy, but I believe they are being used, even misled, to merely be creating conditions for another tyranny to prevail. The libertarian anarchists are correct in stating why the current Federal Union of Criminals Unlimited gives us ample reason to secede. But to what goals do we truly aspire?

(My comment posted from the site, copied below for recording purposes.)

Exceptionally intelligent article. Thank you.

A couple of insights for context.

[callout]The Anarchist movement, and the Rothbardian Libertarian Philosophy, are reactions to the failure of the conservative movement as well as the traditional classical liberal movement that is the jeffersonian model under which our nation has been founded, to provide an intellectual framework that can compete with the combination of marxist philosophy, socialist sentiments, and political tools that derive from the combination of Keynesian monetary philosophy with the rise of the dynamic stochastic equilibrium model. [/callout]

The Anarchist movement, and the Rothbardian Libertarian Philosophy, are reactions to the failure of the conservative movement as well as the traditional classical liberal movement that is the jeffersonian model under which our nation has been founded, to provide an intellectual framework that can compete with the combination of marxist philosophy, socialist sentiments, and political tools that derive from the combination of keynesian monetary philosophy with the rise of the dynamic stochastic equilibrium model. (I realize that this is a mouthful, but it is the correct analysis.)

Mises, Hayek, Parsons, Popper, Rothbard, Nozick, fall failed despite great minds, to provide a solution to the semi-rational tools provided by the above listed models. The conservatives from Kirk onward produced sentimental historical references, but no rational philosophical framework. Especially that could compete with the heady religious scripture, rational philosophy, and volume of production of marxism and marxists.

They failed because government consist of both the associations you refer to, as well as the institutions that limit the use of free associations to become governments themselves, and therefore have the ability to project their will by edict, rather than the ability to advocate their will upon the desirous.

From this viewpoint, the anarchic research program, when approached as a program of research in limiting government (as largely done by Hoppe), has accomplished more than all other freedom-driven intellectual programs.

But as a practical political movement it will fail. It wil fail for the reasons you have stated. However, it has contributed greatly to the philosophical debate. We just do not yet know how to change our institutions to make use of the libertarian anarchist framework of privatization in order to balance the use of monetary policy and redistributive sentiments, with freedom. Libertarians figured it out. Most of it. And we should thank them for it.

The primary change in the nature of government was that western government ceased attempting to increase economic productivity after the great war, and instead, emphasized expansion and redistribution. And this treat to our freedom was started by the Louisiana Purchase and our fate sealed with the civil war. Liberty is for small homogenous states. And as Federalist 10 states, any time you have a government over people with dissimilar economic and cultural interests, it’s not a government, it’s an empire, and as an empire, it’s oppressive.

– a member of the anarcho capitalist research program.

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Privatization From Obama?

While the devil is in the details, and I have less than zero confidence in this president, he proposed a structural change in the way we ‘purchase’ infrastructure projects, that would effectively privatize the process, rather than continue the current (corrupt) process of relying upon earmarks.

From The NYT:

Mr. Obama … called for what the White House is describing as an “infrastructure bank” that would focus on paying for national and regional transportation projects by pooling private money with public investment. He said the bank would eliminate a patchwork system in which transportation projects are financed through Congressional earmarks rather than based on merit.

From The White House

The President proposes to fund a permanent infrastructure bank. This bank would leverage private and state and local capital to invest in projects that are most critical to our economic progress. This marks an important departure from the federal government’s traditional way of spending on infrastructure through earmarks and formula-based grants that are allocated more by geography and politics than demonstrated value. Instead, the Bank will base its investment decisions on clear analytical measures of performance, competing projects against each other to determine which will produce the greatest return for American taxpayers.

Impressive. Now, let’s see it work.