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The Nature Of Man?

The nature of man is to reap the rewards of a market economy, while spending his efforts on avoiding any and all PARTICIPATION in the economy.

In other words, the vast majority of people would prefer to live in countries with advanced market economies, largely because of the quality of life that can be obtained due to the lower price of goods and services. On the other hand, they also want bureaucratic jobs, government jobs, union jobs, and any other kind of employment that insulates them from the unique and necessary property of the market economy: taking risks with one’s resources in an effort to fill the needs of others.

Definitions · Uncategorized

The Common Law vs Fiat Law – Definitions and Expositions

Today, someone, in an obscure little news group, expressed his libertarian sentiments by saying:

“Common law is good enough for all: You must not cause harm, damage or loss, infringe on the rights of others or use mischief in business. To be accused you must have a flesh and blood accuser who can provide proof of claim against you.A jury of 12 decide your fate.”

Which is true, albeit insufficient. And that insufficiency warrants a little scrutiny.

Starting with the fact that the other distinguishing factor of common law is that judges ‘discover’ new properties of dispute resolution as need arises. Men do not make laws. They discover them in the habits and conventions used by real people in the process of developing written and unwritten contracts with one another.

But more importantly, the common law, because it is reactive, and evolutionary, and organic, rather than intentional and proscriptive prevents “legal plunder”: the use of the violence of POSITIVE LAW (law enacted versus discovered) to plunder the population. In other words, our freedom depends upon the common law, and our prosperity depends upon our freedom.

But that doesn’t mean it’s perfect.

THE WEAKNESS OF COMMON LAW

The weakness in common law is this:

When the rate of expansion of an economy results in new entrants into the middle class, new forms of business, new forms of contract, and new technologies, then the evolutionary process of adaptation embodied in the common law comes under duress, since patterns of similarity are difficult for judges to identify. This judicial epistemic delay and lack of coordination can result in return to the perceptoin of ‘arbitrariness’ on behalf of the population which in turn can lead to ‘regime uncertainty’ (fear of trade and exchange due to fear of legal action) which decreases the volume of economic activity and subjects the population to economic vulnerability from external competition. Furthermore, ‘regime uncertainty’ may drive entrepreneurs to seek jurisdictions more favorable to business, which results in capital flight, and a loss of jobs.

LAW AND THE COMPLEXITY OF MULTIPLE DIMENSIONS

Law becomes cumbersome and incalculable when the competing interests of:

      a) Plunder (Redistribution and corruption)

 

      b) Incentives and Punishments (social engineering)

 

    c) Subsidies and Burdens (free trade distortions)

compete with the organically driven properties of:

      d) consumer demand

 

      e) individual property rights

 

    f) the general habits and methods used by participants to coordinate their activities in any industry.

These two sets create no less than is six dimensions of complexity.

Unfortunately, human beings are almost never capable of making more than a single-axis comparison.
Property rights are the only clear epistemological device for creating a legal system that is calculable.
Every other layer of dimensional complexity will lead to (the opposite) Instead of “regime uncertainty”.

TERMINOLOGY IN CONTEXT – AND NEW TERMS TO REPLACE THE OLD

When our English ancestors, and our Founders, fought for ‘their rights as englishmen’, they fought for common law, and the personal sovereignty over their property that must accompany the common law in order for the common law to have coordinated purpose, rather than chaotic result. Only property rights allow rational adjudication of differences between men. All else is chaos.

For these reasons you should never surrender your sovereignty to the state. That we need a government in order to resolve differences among us is one thing. That we should surrender our nobility (rights to allocate our own property) to others is not only illogical, it is impoverishing.

We generally use the terms ‘Freedom’ and ‘Property Rights’. But Freedom has become an ‘appropriated term’ and Property ‘rights’ has become a ‘laundered term’. The more precise and utilitarian terms, that preserve rational debate are:

      1)

**[glossary:Sovereignty]**

      instead of freedom.

2) **[glossary:Calculability]** for the purpose of cooperation and coordination instead of ‘rights’.

(Rights are now an abused appropriated term. Something can only be a ‘right’ if it can be given by each individual to each other individual equally. Therefore, we can only NOT do things, not DO things, in order to grant one another ‘rights’. There can be no ‘positive’ rights without fiat law.)

3) **[glossary:Property]** (or several property) instead of property rights.

4) **[glossary:Foregone Opportunity Costs]** instead of duties or obligations.

5) **[glossary:Portfolio of Forgone Opportunity Costs]*** instead of cultural values

Since these terms, Self-Sovereignity, Calculatibity, and Several-Property are NECESSARY properties of human cooperation, rather than indistinct, appropriated, logically inconsistent or emotionally loaded terms, (n-dimensional terms: those that contain unarticulated dimensions for the purpose of distorting causality –ie: fraud — and most commonly for the purpose of mixing emotional reaction, which is a property of the past, with epistemic necessity, which is a property of the future).

USEFUL DEFINITIONS:

0) LAWS

      a) COMMON LAW: evolutionary. Organic development. Obtained by observing the normal practices of humans. See “Natural Law”.

 

    b) FIAT LAW: totalitarian. Made by intention. For the purpose of ALTERING rather than RECOGNIZING the behavior of humans.

1) COMMON LAWS:

      a) Common Law Manners (Protocols that both reduce the friction of operating in a market, as well as symbolize one’s status, and potential merit in the market)

 

      b) Common Law Ethics (Rules that prevent partial asymmetry of information from being used for theft and fraud, in order to reduce friction and accelerate the rate of production.)

 

      c) Common Law Morals (Rules that prevent the privatization and therefore corruption – by prohibitiying the externalization of intertemporal costs onto others due to complete asymmetry of information.)

 

    d) Common law (property) necessary for economic calculation, and coordination in a complex economy.

2) FIAT LAWS:

      a) Regulatory law (industry specific ‘codes’ that prevent fraud and mischief in complex divisions of labor)

 

      b) Trade Balance Law (industry specific redistributions to allow the state to negotiate for prices with foreign states)

 

      c) Tax Law (commissions on productivity that are earned by the government in exchange for facilitating the

 

      d) Redistribution Law (class specific distortions to the economy that permit the state to redistribute from one group to another)

 

    e) Social Staus Redistribution Laws (commandments upon the behavior of the people in order to redistribute social status)

Manners, Ethics, Morals and the Common Law are a “self evolving, organic system” of rules for coordinating the actions of people in large numbers. As long as judges are allowed to use manners, ethics and morals in concert with the common law, in adjudicating differences.

THE RESULT OF MULTICULTURALISM

For this reason alone – ‘common law competition’, multiculturalism is an extremely high burden on an economy when combined with Fiat laws. Political Multiculturalism causes competition between common law systems, that may only be resolved through fiat law. Multiculturalism is then, “The Other Road To Serfdom”.

Uncategorized

No Surprises In Wikileaks: It Only Illustrates The Obvious: Overreach By Our Bureaucracy.

SURPRISE? NO SURPRISES IN WIKILEAKS AT ALL.

These are common diplomatic cables, written in the common business-language-of-state.

Anything ‘shocking’ is simply the result of how people speak when they believe that their communications will remain private. Look at your own email, or personal conversations. We all trash-talk whenever we can. It vents our frustrations.

For example: Everyone knows that Berscolini is a vain and incompetent man. But he’s a politician in Italy.

Putin? We’ve all known Putin’s ambitions and position for years. Is confirmation something we needed?

There is nothing so far in these docs that hasn’t been discussed to death.

The docs only give legitimacy to those previously debated topics.

*** Fools will always find a source of conspiracy in the natural incompetence of bureaucracy. ***

WHAT WE LEARNED:
There are only three things to learn from these docs:

[callout]There is no competent leadership in washington, and it is possible that there cannot be competent leadership, that can develop a consistent policy across that divergent a set of interests.[/callout]

1) The people who work on these communications are simple white collar government clerical bureaucrats, covering the communications of a vast and diverse state department, running a large naval empire during a time of enormous economic and political power changes.

2) The state department bureaucracy is too big, and american political and military reach is larger than the competence of the individuals in the State Department can coordinate — which is true of all bureaucracies.

3) There is no competent leadership in washington, and it is possible that there cannot be competent leadership, that can develop a consistent policy across that divergent a set of interests.

HOWEVER

The solutions to most of these diplomatic issues has been covered by Huntington in the Clash Of Civilizations. That is the only policy document necessary to coordinate the vast national interests abroad. We need a strong russia. We need a non-nuclear iran. Islam needs a different core state. We need to help south american, asian, hindu and the vast, ignorant, poor islamic states come into power, while we gracefully reduce our scope of responsibilities.

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Tyler Re-Reads Road To Serfdom And Misses The Point

I don’t particularly like criticizing Tyler Cowen, but this is a bit ridiculous, and I”m going to have to chalk it up to excess holiday tryptophan.

Last time I read Road To Serfdom was this fall, driving cross country. Actually, I listened to it on tape. And I cautiously pulled aside whenever I needed to take notes. I took ten pages of notes. But that’s OK. It helped with fatigue.

Tyler recently re-read Road To Serfdom. Here are his comments.

Rereading *The Road to Serfdom*

Given all the recent fuss, I picked it up again and found:
1. It was more boring and less analytic on matters of public choice than I had been expecting.
2. Although some of Hayek’s major predictions have been proven wrong, they are more defensible than I had been expecting.
3. The most important sentence in the book is “This book, written in my spare time from 1940 to 1943…”  In those years, how many decent democracies were in the world?  How clear was it that the Western powers, even if they won the war, would dismantle wartime economic planning?  How many other peoples’ predictions from those years have panned out?  At that time, Hayek’s worries were perfectly justified.
4. If current trends do turn out very badly, this is not the best guide for understanding exactly why.
It’s fine to downgrade the book, relative to some of the claims made on its behalf, but the book doesn’t give us reason to downgrade Hayek.

Straw man. Self serving at that. No direct criticisms. Obtuse criticisms are illogical.

a) The book contributed to the current state of affairs.
b) The book was written for the masses, and that is why it has been widely read., and why it contributed to the current state of affairs. (more so than Braudel – although no discredit to him – and others.)
c) The book’s criticism of central planning is not the same as the current criticism of the welfare state.

And I do not understand, nor does it appear others here do, why you grant particular grace to current democracies – the merit of which is still in play, until we observe how we fare now that the rest of the world has adopted capitalist instituions, and erased our prior advantage. It certainly appears, that instead of Democracy, the award goes to capitalist institutions, calculation and incentives. Democracy is irrelevant. Other than, under democracy, it appears, it is far more common to vote one’s self into tyranny, than is possible under parliamentary monarchy, or oligarchy.

I believe the three points above refute all four of your observations. In fact, I’m having trouble understanding why you even view it through your empirical framework. It is a narrative pedagogical work. And as a narrative pedagogical work it will very likely be as durable as most innovative narrative works are, versus the very perishable empirical works of political economy that are fashionable flashes of the moment.

AFWIW: Whether one lives under tyranny or not is a matter of perspective determined by one’s definition of property.

Cheers

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Two Founder Quotes Translated Into Forgone Opportunity Costs

“To suppose that any form of government will secure liberty or happiness without any virtue in the people is a chimerical idea.” — James Madison

Becomes: “Liberty represents the ability of each individual to achieve his greatest happiness, but only by servicing the wants and needs of others, and to do so by participating in the market. By doing so he reduces prices and increases choices, and creates value through exchange and decreasing prices through a division of knowledge and labor. It is an impossible supposition, that any form of government that we create, and any system of incentives and punishments we invent, will secure us our desired prosperity without the willing contributions of citizens, who daily pay for that prosperity by their expenditure of effort in production and exchange, but also by their forgoing of opportunity for gain by means of legal plunder, or by fraud, or by theft, and therefore avoiding paying the high cost of maintaining that prosperity.”

“To compel a man to subsidize with his taxes the propagation of ideas which he disbelieves and abhors is sinful and tyrannical.” — Thomas Jefferson

Becomes: “A man pays for his government first, in forgone opportunity costs, and second, by the expenditure of his time and labor in production and trade, and third, by the taxes he directly pays to the government. He pays with all three: since all three are avoidable, he pays with all three methods. Manners, Ethics, Morals, and most importantly, his avoidance of corruption: to live off the productive results of others without voluntary exchange – provide his easiest means of cheating – of obtaining the benefits of such a society at a discount. A man who does not pay the cost of manners, ethics, morals, AND observation of the cultural system of obligatory payments we call culture, is a thief. Therefore when the government ‘tolerates’ counter-cultural behavior it condones theft. When it supports people who do not make such payments, it pays one group to steal from another. Therefore, no man who makes payments to the state either in taxes or in forgone opportunity costs, should ever tolerate redistribution of his efforts to brigands, and thieves.

The purpose of a government is to disallow people to obtain extra-market discounts while obtaining the benefits of participating in the market.

A barbarian is someone who does not participate in the market, and in particular, someone who steals from the payments of citizens by avoiding the forgone opportunity costs we call ‘culture’.

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To Time Magazine on Taleb: Quantity and Probability.

Mr. Galdel, of Time Magazine, asks readers what questions he should put before Nassim Taleb, author of The Black Swan, and implies, without understanding his own cognitive bias, that the liberal belief in our own wisdom and control of our own destiny is unquestionable.

http://curiouscapitalist.blogs.time.com/2010/11/23/whats-wrong-with-bernanke-and-qe2-ask-nissam-taleb/

Taleb has recently been bashing Bernanke saying he doesn’t know what he is doing because he didn’t see the financial crisis coming. But Taleb has also said that the financial crisis was a Black Swan. But isn’t the definition of a black swan something that people don’t see coming. Yes, we should be ready for unusual events. But don’t think you can criticize someone for not see(ing) something that by definition was unpredictable, or at least very, very unlikely. What say you Taleb?

Mr. Gandel,

“not see(ing) something that by definition was unpredictable, or at least very, very unlikely.”

That’s the whole point. That statement expresses the entire difference between left and right political philosophies, and between quantitative economists, and the austrian school: namely, that the unforeseen is unpredictable because:
1) The foreseen is unquantifiable (this is the entire issue in economics)
2) the unquantifiable is unpredictable
3) the scale of the impact of unforeseen, unquantifiable, unpredictable events is likewise unquantifiable.

Therefore risk is there for not probabilistically measurable by mathematical means.

Therefore risk measurement, and quantitative probability as used in financial speculation is FRAUD if committed by those who understand these principles, and ERROR if used by those who do not. Since these ideas are hard to grasp, a few people commit fraud, and a very large number of people commit error.

Taleb’s indictment of the Nobel Committee is the most serious because it was their awarding of prizes to econometricians that allowed those who wished to commit FRAUD, to convince a lot of people to commit error, and in doing so create this catastrophe.

Taleb’s proposition is that we are applying the mathematics of closed, permutable systems (probability) to the open, innovative, dynamic system of human interaction. In effect this is the warning given by the Austrian school to all political economists: we know how to enable the greatest amount of creative innovation in a marketplace, and in doing so create the greatest competitive advantage and the lowest prices, for the benefit of all. But political systems must aim at enabling that process, not achieving any particular end, while assuming that that innovative process will tolerate infinite manipulation.

Taleb’s recommendation in The Black Swan, is that we must build our nations such that we recognize the COMMON-NESS of disruptive, unforeseen events. Therefore we should seek stability, security, and safety, and not expose ourselves to risks.

We should never have assumed that such a thing as complex derivatives would provide risk mitigation — regardless of corrupt rating companies and bankers.

We should build policy that expects the unforeseen. We should avoid policy that invites fragility from the impact of the unforeseen.

This is probably an anathema to Time’s editorial staff. Because Taleb’s premise is core of Conservative political philosophy: take small risks, work through the market, and do not empower politicians to expose us to risks: Maintain strength and capital, both human and material, so that we can survive the inevitable shocks to our system.

Of course, if we just read Aesop’s Fables we can learn the single lesson that Aesop attempted to teach us: avoiding the error of hubris – overestimating our knowledge and understanding.

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What does free speech have to do with copyright law?

An interesting question from Mises.org:

” What does free speech have to do with copyright law?”

It’s fascinating how this fairly simple set of ideas can exist in the public discourse without understanding the rational foundation upon which the concepts of free speech and copyright are based.

a) Books, magazines, movies, plays, music (at least, in theory, music with lyrics), advertising, speeches, lectures, photographs, works of art, are products that market ideas (largely narratives.) Copyright law attempts to protect narratives from theft just as patents protect manufactured goods, from profiteering by copying and redistributing other people’s inventions.

b) Any of these ‘narrative product’ may contain political speech.(content)

c) Determination of political content is extremely difficult. Harmful or beneficial political content is hard to judge (pornography for example), and therefore the law (as a profession) seeks to avoid having to make those decisions.

d) Free speech as a practical constitutional concept rests on two assumptions:

d.i – that the admitted harm that comes to society from free speech is offset by the protections we obtain from free speech.

d.ii — And to narrow these protections to just those that are overtly political is extremely difficult to the point of practical impossibility.

e) Some products are political by definition, and copyright can be used to deny political works to the market, and especially intellectual products that are purely social and political in nature.

f) copyrights (like patents) should not allow a product to be held from the market, for the purpose of increasing it’s price. (Granted a monopoly.)

So, speech and copyright law are effectively tied-concepts because they are mutually dependent. One cannot have copyright without speech, because all copyright is dependent upon speech. We would have far less speech (content) and experimentation (innovation) without copyrights. The scope of speech that needs protection is untestable, and perhaps unknowable, and it is therefore impossible to regulate by content.

The argument from the Anarchist position is that copyrights AS THEY ARE CONSTRUCTED create a host of reasons for abusive government, regardless of the attempts of the creators of copyright law to prevent just such abuses. But the practical, measurable empirical evidence is that copyrights do improve innovation, wihc in turn, improves competitiveness, which in turn, reduces prices. The Hoppian/Rothbardian solution, even if they would not advocate it, would be to privatize copyright protections, so that we are not burdened by abusive government, or the costs of administering other people’s works.

Again, the fundamental problem here is that it is very difficult to develop criteria by which one thing is equal to another thing, for the purposes of copyright. It is very difficult and expensive to regulate and jury. THe other is that artificially increasing prices of easily reproduced goods is counter to the premise on which the market is based.

I think that the solution, as others have said above, is that reproduction for commercial or self use is different from reproduction for the purpose of distribution and sale. I think personal reproduction, even if it deprives the author of profits is within the speech and copyright objectives. I do not see that there is an argument wherein the authors have the right to prevent you from doing whatever it is once you’ve purchased a commercial product from within the market. I do see that someone concentrating capital for the purpose of profiteering from activity in the market, based upon the innovations of others, without paying a commission for doing so, is simply theft, and is not beneficial. The market political theory requires us to innovate, even if innovation is simply opening up new markets.. I do not see the value in copying. That’s just parasitism. Markets exist and function because of enfranchisement, not parasitism.

I do not think that the market philosophy (even in libertarianism) supports parasitism. I know libertarians do not support rent seeking (parasitism) by the use of organs of the state. Why should we tolerate parasitism in absence of the state? Or is it that we care more about the state than we do about the very market society which we hope to entrust with our social order?

That is the incongruity in Anarchist thought.

Government exists to improve the competitiveness of the market for the purposes of decreasing prices and increasing choices. Without a market, there can be no government. There can be slavery, but no government. We pay for the market by forgone opportunities for violence, for theft. Violence and theft are epistemologically simple tasks. However, markets invite fraud BECAUSE they prohibit violence (retribution for theft).

And as far as I can tell, copyright law is simply fraud protection.

Others are welcome to debate me on this. But I doubt efforts will result in success.