In a comment to my post on the NAR’s most recent attempts to rape the taxpayers, Michael Cook set forth a number of subtle economic fallacies. I am not picking on Michael. He is simply repeating Marxist propaganda that is ubiquitous, more’s the pity. But I thought it were well to take these claims apart, to illustrate how these kinds of fallacious arguments are used to frustrate human liberty. I’m taking this to a separate post because the comments thread on the original post is already wildly off topic.
So: Start here, quoting from Michael’s comment:
The very capitalist machine everyone here loves was bolstered by the use of slaves.
This is simply false, not alone simply by definition. The first word in “free enterprise” is “free.” Transactions in a free economy are always mutually-voluntary. If someone is being coerced, what is occurring is a crime, not an honest trade. Every modern economy we can speak of is in some way a form of socialism — a criminal conspiracy harnessing the power of the state to advantage certain people at the expense of the others. Slavery is of a piece with this pattern, although it predates modern economies by many millennia. Moreover, it was the free enterprise that was suffered to exist under modern Rotarian Socialist governments that finally rid the civilized world of chattel slavery. To be fair, this miracle was effected not by a moral awakening but simply because slavery is a lot less efficient than is investing wisely in fixed and human capital. In any case, slavery and free enterprise are mutually-exclusive phenomena.
History is wrought with takings back to the Egyptians, Roman and Greeks.
The same fallacious argument repeated, only this time with respect to land and portable wealth. Theft happens, but theft is not wealth creation. Consumable portable wealth quite literally turns into shit in no time. Mineral wealth and baubles can retain their exchange value, but these are static values. It is not possible to cultivate stolen gold or rubies. And stolen land or livestock is only productive of future wealth by means of intelligent husbandry.
Neither of these crimes — coercion or expropriation — have anything to do with free enterprise, but there is another error here as well, an imputation that crime somehow pays. This is almost always false, and the premise has nothing to do with the economic miracles we associate with free enterprise, in any case. Every bit of wealth that matters in our everyday lives is a product of human capital — assiduous thought and effort. You can steal the products of other people’s past thinking, but you cannot steal their minds, nor their future thinking, nor the even greater wealth that may result from that future thinking.
Both of Michael’s first two claims originate in the criminal’s fallacy: By stealing the other guy’s stuff, I will possess his wealth. Really what the thief hopes to steal are his victim’s genius and character — not his things but the mental and moral resources from which those things were created. This is a very funny idea, and it would be a lot funnier if it had not been deployed by Marxists to exterminate at least 160 million innocent people, while enslaving billions more. In truth, all human wealth is the manifestation of human capital, which, because the mind is exclusively internally controlled, cannot ever be stolen.
Here’s an example that has nothing to do with money: You can steal a great painting and slap your name on it. In doing so, you might reap effusive praise from the gullible. But you will never be the person who created that work of art, nor, by having stolen it, will you have transformed yourself into a great artist. The source of human wealth can never be stolen, and so it is absurd to claim, first, that free enterprise consists of crime and, second, that crime is somehow productive of future wealth.
There is one plausible exception to the argument I just made: If like the English colonials who raped Africa and India, you invest the proceeds of your theft in wealth-producing enterprises, you may earn future wealth. That’s true, but it’s not terribly interesting. It’s simply a conflation of two unlike things: The theft was evil, even if the investment might have proved to have been wise, but the two are radically different activities. The original investment capital came from expropriation, but the subsequent growth of that wealth was the consequence of human thought — almost always someone else’s thought. One can invest and profit without having stolen anything, but any wealth you might have stolen will not grow in value without being invested. They are not the same things.
You can see the same phenomena at work in the frontier American experience. The Kabuki dance of land acquisition in North America worked like this: Torment any nearby Native Americans until they respond violently, then run to the Cavalry to insist that the land you plan to occupy must be pacified. Thus was territory after territory captured by the U.S. Cavalry. The argument that we like to make to ourselves is that this land was stolen, but that’s a claim that only makes sense if we insist that that land was being husbanded, which, in most cases, it was not. This does not mean that the means by which it was acquired was morally righteous — it wasn’t. But it does mean that the wealth that accrued to the pioneers from the husbandry of that land did not originate in its having been stolen, but, rather, in its having been cultivated. The pioneers were Rotarian Socialists, just like their cousins on Wall Street, but the incredible wealth both sides of the family created resulted from assiduous thought and hard work, not from theft.
The two together, craven theft followed by sound investment, can be found here and there in human history, and it is plausible to me that the perfection of this twisted theory owes to the Romans — the conquering general who retires to his conquered latifundium. But theft, the proceeds of theft and the investment returns on the proceeds of theft don’t matter very much in a free enterprise economy. The great wealth by which you are surrounded is the product of human genius, not of theft. Henry Ford could not have stolen the assembly line, nor Jonas Salk the polio vaccine. The Mormon pioneers were more than unusually peaceable in their interactions with the Utes, but the dry-farming techniques they invented in Utah were the basis of the Green Revolution that permitted the massive population explosion in the poorest parts of the world in the twentieth century. Some land Mormons bought, some they may have stolen. But the unprecedented wealth they produced from their new farming technologies, in Utah and in arid climates all over the world, was the product of their thinking, not of any thefts.
The Marxian focus on theft is useful to Marxists — since Marxism is a criminal conspiracy disguised as a philosophy of charity. But, contra Marx, wealth is not static, and it does not grow as a consequence of having been stolen. The growth of human wealth is caused solely by growth in human knowledge, and the West — loosely defined — is rich because people in the West have been largely free to improve their minds and to profit by and to retain and reinvest the profits of having improved their minds.
Which leads us to this:
[Y]ou are participating in a taking with every illegitimate debt payment we receive from a country we colonized or extorted.
There is more than one error here. The first premise is that any compound-interest value of the invested proceeds of stolen labor or property is owed to the expropriated parties. That’s a colorable claim, but a judge with a calculator might figure the interest value of the debt at the rate of growth that could be anticipated at the time and place the wealth was stolen, rather than in the economy where the proceeds were invested. Either way, the argument doesn’t get much traction, inasmuch as virtually all thieves are wastrels — investing nothing and dying in squalor.
The second premise is that past crimes can somehow be redeemed. In virtually all cases, this is not possible. Both the offenders and the offended parties are dead.
Which leads to the third premise, that the consequences of the past crimes of dead people must be visited upon the living. This is identity politics: Because I am part Cherokee, I am entitled to compensation for crimes committed against my ancestors. Even better, I’m also descended from Celts, so I’m owed my share of the Gold of Tolosa. The name for this vile injustice is “the sins of the father.” We would have no problem identifying the error were I to be brought up on trial for any scalps taken by Tecumseh.
But that example perfectly illustrates the fourth invalid premise packed into Michael’s argument: Certain past crimes committed against politically-favored identity groups constitute a sort of post-modern doctrine of Original Sin. Because I am a beneficiary of all of the wealth that has ensued from the correct and appropriate uses of the human mind, I have incurred an unchosen and inescapable debt to all of the victims of pandemic thoughtlessness, all over the world. My ancestors owned slaves — as did everyone else’s ancestors — but because I can be induced by propaganda to feel guilty about my wealth, I am to be forevermore enslaved. This is incredibly vicious and wrong — even as it is a testament to the clever crafting of Marxist propaganda that it takes such an effort to illustrate the injustice of this bizarre notion.
Take note: I was born free in a still-relatively-free country. Surely some part of my wealth originated in past crimes, but I did not commit those crimes, and I am not responsible for them. I owe money every which way, but only to people who — perhaps to their regret — freely volunteered to lend it to me. I am very sorry that many, many dead people were badly hurt while they were alive, but I did not injure any of them. I am guilty of nothing, and I will not permit anyone to accuse me of any crime, ever. As thoughtful people here will have noticed, I am the enemy of all crime, including violations they had never thought of as being crimes prior to coming into contact with me.
But all that notwithstanding, whatever portion of my wealth might owe to the compound-interest value of past crimes, this is nothing in comparison to the share of my wealth that has accrued to me in consequence of the past thought — and the compound-interest value and the compound-thought value — of honest free-traders. Wealth is created by thought, not theft, and thought cannot be stolen. I am massively rich, even from the depths of my debts, because very smart people traded their best thinking for the best thinking of other very smart people. I repay those people to the extent that I can — most of them are dead — by bringing my best thinking to the marketplace as well. As an example, I am providing readers here, gratis, the schooling in economics, politics, ethics, epistemology and metaphysics they were denied in twelve or more years of so-called education.
All of which takes us to Michael’s final claim:
[Free enterprise] will not meet the needs of the 2 Billion plus people concerned about simply finding enough food today in this world.
To the contrary, free enterprise is precisely what those people need. They are poor for no other reason than that they are not permitted by their thug governments to profit from the use of their minds. They lack defined and enforceable rights to the land they live on — itself stolen dozens or even hundreds of times in the past, incidentally. And they are denied the right to benefit from and reinvest the proceeds of their thought and effort. In every case, where a tribalist or socialist society adopts true free enterprise, a so-called “economic miracle” ensues. Don’t believe me? Take it up with our customer service rep in Mumbai. We call these societal transformations “miracles” because we have twisted our minds in impossible contortions so that we might insist to ourselves that the free, mutually-voluntary exchange of the products of genius does not produce wealth, but theft somehow does.
Take a look at that premise again:
[Free enterprise] will not meet the needs of the 2 Billion plus people concerned about simply finding enough food today in this world.
How can you redistribute wealth to people who are starving — because their local thugs want them to starve — if it has not first been created? If free enterprise — the wealth created by the unfettered human mind — were not the only source of of our incredible abundance, there would be no wealth to be redistributed to the victims of thuggery. No one needs defensible property rights more than the man who has barely enough property to stay alive — and no one can profit more, proportionately, by the intelligent husbandry of that property. But consumable wealth turns into shit overnight. The poor people who are to be fed but not freed are beneficiaries of free enterprise — one meal at a time. If would be kinder, by far, to free them to produce their own wealth — and, as the steady liberation of the economy of India illustrates, we would all be richer as a result. But it is absurd to say that free enterprise will not meet their needs. Any redistributed wealth they might be receiving originates in the abundant surpluses issuing from free enterprise.
Please note, as always, that I am talking about secondary consequences of human freedom. Human beings are free as a matter of ontology — no matter how much you might wish you could enslave them. If you stay out of their way, they will create vast wealth for themselves and for everyone around them. And not just pecuniary wealth, mind you. Everything we know of philosophy, art, science and love emerges solely from the free human mind. But if you insist instead upon obstructing their path, you will succeed not only in confiscating their wealth — almost always turning it into shit — you will have erected systemic barriers to the future creation of wealth. The mind cannot be stolen, and the future — and perhaps frustrated — products of the human mind cannot be stolen.
Poverty is the consequence of criminal philosophies — doctrines, like Marxism, cleverly devised to disguise their kleptocratic premises. Wealth is solely the consequence of the free exercise of the human mind. If you want to cure the world of poverty, you must foreswear crime and engage with other people only by mutually-voluntary trade — free enterprise. And it doesn’t really matter how much richer you or they come to be as a result of your interaction. What matters is that you will be acting in accordance with the true, inescapable, unchangeable nature of human beings. Amazingly enough, as a matter of reliably repeatable existential praxis, acting with respect to other people as they actually are — and not as your twisted theory insists that they must be — works out better for everyone.
Meanwhile, don’t ever let anyone make you feel guilty for your wealth. You are far richer than you could ever be on your own, no matter how much land or livestock or gold or jewels or human labor you might steal. But you earn your seat at this incalculable feast by the wealth that you yourself bring to it, the proceeds of your past thought and effort. Yes, you stand on the shoulders of giants. Don’t let your would-be despoilers guilt you into slouching or bowing or kneeling — or crawling. You are guilty of nothing — except perhaps the failure to think through all the many lies you have been told by camouflaged criminals.
Brian Brady says:
“No one needs defensible property rights more than the man who has barely enough property to stay alive — and no one can profit more, proportionately, by the intelligent husbandry of that property.
This resonated with me. I wonder what might happen if we promised a generation that the theft and entitlement culture we embraced wouldn’t apply to them. We’d “deny” them social security, subsidized health insurance, and all State-run economic programs and commensurate taxation.
It would be nearly impossible because of the Ponzi scheme behind these programs but it might be good starting point.
June 6, 2010 — 11:26 am
Bill says:
Interesting article and interesting read – thaks very much for your point of view…definitely sparked some discussion with a group of my friends…
June 6, 2010 — 3:07 pm
Michael Cook says:
Thanks for taking the time on this. Its much appreciated, and while I most certainly still disagree wtih a few of your points, I dont think we are as far off as you portray here.
I dont begrudge you wealth and I most certainly dont think you should feel guilty for who you are or what you have. Over the course of the day, I will try to respond to the most important points that I disagree/agree with given the breadth of the explanation.
Lets start here:
“History is wrought with takings back to the Egyptians, Roman and Greeks.” If I occupy land and choose to use it in a certain way, why do you have the right to take it and use it for what you deem is a higher and better use?
“The argument that we like to make to ourselves is that this land was stolen, but that’s a claim that only makes sense if we insist that that land was being husbanded, which, in most cases, it was not.”
Why is this the case? If I occupy land, I have the right to do with it what I please. If you steal my land and build a factory on it, good for you, but I just want the land back. I dont want the factory. I want to be able to hunt, farm or raise a family, I dont want your enterprise. I dont see how this meshes with your principles of my freedom to be who I am without being distrubed by you.
And here:
“[Y]ou are participating in a taking with every illegitimate debt payment we receive from a country we colonized or extorted.”
Lets look at a current example of France and Haiti. France colonized Haiti, enslaving the population and forcing them to export key and critical resources. Under threat of invasion, they forced the Haitians to pay $150MM francs for their independence. To this day, a signficiant portion of Haiti’s GDP goes to servicing this illegimate debt. France continues to enrich themselves based on the crimes of their forefathers.
In business we talk about opportunity cost. To date, Haiti has paid France well over $150MM francs on this debt. Imagine if they could have spent this money on roads, schools, infrastructure, etc. Where would they be as a country??? Conversely, France was able to jump start their economy with an extra $150MM+ francs (excuse the dollars signs by the way, I dont have access to symbols). Now, they can use their infrastructure to start building wealth with easier access to trade and a better environment to create.
Is the solution to immediately transfer wealth from France to Haiti, maybe, maybe not, but at a minimum, France should cancel the current debt they imposed by force on a country they enslaved, no? Furthermore, how do you make up for the $150MM franc opportunity costs? These are sins of the father that continue today. This is not an isolated situation, either, but rather the easiest and clearest example of it.
More on this later, but it seems that if I start with $100, its easier to make $1,000, than if I start with zero. My premise here has been, since I took your $100 to make $1,000, at the very least, I should give you $100 to let you have an opportunity to make your $1,000.
June 7, 2010 — 9:59 am
Chuck Marunde says:
Well done Greg. When I first became a high school teacher, I was amazed at how the teachers union used our money to promote socialist dogma that was clearly contrary to American history and precedent. My teacher colleagues at the time just said, “Oh well.” When I became an attorney, I was surprised at how liberal our law school education was, and how we never once in our Constitional Law class were asked to read the U.S. Constitution. In fact, not once during three years of law school did any professor have us read the constitution, nor did we discuss the original intent. My Con Law professor was a homosexual who clearly had a lot of hatred for American capitalism. School books have been re-written to expunge our true history, including the evil of Marxism and the true good that capitalism does for the rich AND the poor. Socialists politicians have been leading the propaganda charge for several decades in the U.S. It’s about time Americans wake up and dig into history for themselves. It’s about time “average” Americans stand up and engage themselves in the political process. We are not far from total socialist chaos. I wonder how Alex Baldwin would feel if we took his house and his wealth and re-distributed it all? Would he love socialism then?
June 7, 2010 — 10:04 am
Michael Cook says:
“To the contrary, free enterprise is precisely what those people need. They are poor for no other reason than that they are not permitted by their thug governments to profit from the use of their minds. To the contrary, free enterprise is precisely what those people need. They are poor for no other reason than that they are not permitted by their thug governments to profit from the use of their minds.”
I think this is a common misconception. While there are certainly incidents of government takeovers, genocide and the like, there are many governments in the Sub-Saharan Africa that are not corrupt, where people can own their own land without fear of a taking. By your definition, they are probably much freer than we are here in the US. The problem is that they cannot innovate because they cannot eat. They spend all their free time farming land that will barely produce enough food for them to eat and count themselves luck if their needs are met. They cannot afford fertilizer and cannot manage to save or invest. When you spend your entire day searching for food, you dont fear government or tyrants, because they dont want your land. You fear disease because it means you cannot work.
These people are not lazy in the least bit. They work harder than I do, they were just simply born in an unlucky place. Ironically, if they were to have fertilizer and modern farming techniques, they would then have the time to start businesses and participate in Global Capitalism, but alas, they simple only have time to make food.
I said early, I thought everyone was entitled to food, shelter, and clothing. Let me amend that, how about everyone is entitled to the means to produce adequate food, shelter, and clothing. You cannot innovate if you cannot eat, despite what many well fed inventors will tell you.
Capitalism is a great tool to move an economy forward, but does not work in all cases. You need a minimum level of subsistence for it to succeed.
June 7, 2010 — 11:06 am
Greg Swann says:
I’ll come back to your other comment later, because it’s more complicated. If I stipulate everything you say here, the people you are talking about need one of three things: Jobs, investors or relocation. The fact that they don’t have jobs or investors argues that their governments are not capital-friendly and probably not respectful of any sort of valuable private property. If the argument is instead that the land won’t support the people as hunter/gatherers, herders or agrarians, then those people need to move. My untutored expectation is that detailed investigation will reveal some form of kleptocracy — either thugist, Islamist or Marxist — in any impoverished country you might name. I made of a point of supplying an example of this yesterday: Tanzania went from poor but self-sufficient to starving when its dictator adopted Marxism. This is no accident, as Herr Doktor Marx liked to say.
June 7, 2010 — 12:20 pm
Jim Klein says:
“More on this later, but it seems that if I start with $100, its easier to make $1,000, than if I start with zero.”
That’s another right one, Michael!
“My premise here has been, since I took your $100 to make $1,000,”
Why did you take his $100? Your implicit premise is that somehow someone got $100, without someone losing the $100. Besides, I think you’re saying that someone before you (who somehow represents you) took the $100. Not only does he not represent you, you are explicitly offering that stealing the $100 now from someone to give it to the guy (descendant, really) who had the original $100 stolen, will help something. Seems to me all it does on balance, is double the number of thefts!
“at the very least, I should give you $100 to let you have an opportunity to make your $1,000.”
So give it! You earlier said that you didn’t need economic lessons, but you keep making the same wide fallacy. Somehow you think that a $100 can be given on one side of the transaction, without an attendant $100 missing from somewhere else. This was Hazlitt’s point in “Economics in One Easy Lesson.” You’re seeing what the money is buying for the person getting it, but you’re not seeing what it didn’t buy for the person who had it.
June 7, 2010 — 12:17 pm
Greg Swann says:
> Seems to me all it does on balance, is double the number of thefts!
That’s why I brought up The Gold of Tolosa, because it’s such a funny story.
At Step 1, a party of Celts stole something like 50,000 talents of gold from various Greek cities. No one knows where the Greeks got the gold. Plausibly, at least some of it had been stolen, not mined, by the Greeks. A talent is the weight a legionnaire could carry on his back, say 65 pounds. In other words, we’re talking about a lot of gold — perhaps as much as 52 million ounces.
The Celts hid the gold in Transalpine Gaul, where, at Step 2, it was stolen by a Roman army lead by Quintus Servillius Caepio.
Caepio shipped the gold back to Rome under a feeble guard, this so he could steal it all for himself at Step 3. (This incident is used for comic effect in the HBO series Rome; the fictionalized Centurion Titus Pullo finds the gold.)
Caepio was banished from Rome for the theft, but all of his wealth passed at Step 4 to his last surviving heir, Marcus Junius Brutus, more famous as a leader of the conspiracy to murder Gaius Julius Caesar. Brutus could have used that gold in the ensuing civil war, which his side lost, but The Gold of Tolosa was never recovered.
But consider the claims of the injured parties:
1. Whomever the Greeks despoiled were entitled to some or all of that gold.
2. The Greeks were entitled to all of it.
3. The Celts were entitled to all of it.
4. The Roman Republic was entitled to all of it.
5. And poor pitiful Brutus was robbed of his legacy.
That comes out to 260 millions ounces of gold, not counting opportunity costs and compound-interest. Let’s call it a billion ounces, just to be safe. Is that more gold than exists on earth? In any case, the original Gold of Tolosa is still lost. Treasure hunters might deploy their metal detectors around Smyrna.
But how would you decide a case like this, if it showed up in your courtroom?
My answer is simple: “You’re all a bunch of goniphs. Get the hell out of my sight!”
June 8, 2010 — 12:03 pm
Michael Cook says:
“My untutored expectation is that detailed investigation will reveal some form of kleptocracy — either thugist, Islamist or Marxist — in any impoverished country you might name.”
In my mind this is like saying, which came first, the chicken or the egg. Putting aside the point of how they got here, even though I do find that to be relevant, its more important to figure out how to move them to another place economically.
These places face significant challenge drawing foreign capital because they dont have roads and they are not located on a water source for transportation. Landlocked economies need infrastructure investments to draw foreign investments. Its not a case of the land not supporting the people, but rather a case of the people needing infrastructure investments to participate in Global Trade.
Kick start the infrastructure and then let capitalism work makes perfect since to me, but obviously that will require some outside investment. Either in the form of Aid, Debt Retirement or Foreign Investment. I support all three, but ironically many places could get the third if they were able to secure the second.
This gets by to the “sins of the father situation.” It feels like it works both way. If my father makes a bad debt, should I have to pay it back? Using the same logic you describe earlier, the answer would be no. But the problem here is that governments will enforce sanctions, both financially and militarily, if they were to stop making payments. Thats where I feel like your philosphy runs counter to reality.
June 7, 2010 — 1:28 pm
Greg Swann says:
Name some countries. I’ll look into them this evening.
June 7, 2010 — 1:35 pm
Michael Cook says:
“Why did you take his $100? Your implicit premise is that somehow someone got $100, without someone losing the $100. Besides, I think you’re saying that someone before you (who somehow represents you) took the $100. Not only does he not represent you, you are explicitly offering that stealing the $100 now from someone to give it to the guy (descendant, really) who had the original $100 stolen, will help something. Seems to me all it does on balance, is double the number of thefts!”
I believe the problem is that we still benefit from the thefts today and remain quite punitive in our actions. The United States receives Debt Service payments from man foreign countries in which we have unjustly “loaned” them money. For a moment, lets put aside loans to dictators, which future generations must pay for and discuss the Haiti situation. This is not your father, this is YOU, who receives a debt payment every year for a wrong your father committed. YOU are the one who threatens miltary action or economy sanctions or both against this country if they do not pay. YOU continue to perpetuate the sins of your father. Perhaps its your government, but YOU still benefits from these wrongs. Its not some nebulous benefits, its a literal cash transfer from one country to another every year based on multiple wrongs committed over 100 years ago.
I do not believe that $100 can be created from nothing. I believe that the Haiti’s gave $150MM francs of their blood, sweat and tears to France in return for nothing. If being free is my right as a human being, I will never recognize someone charging me for it. In a sense they are still not free because they still owe.
“You’re seeing what the money is buying for the person getting it, but you’re not seeing what it didn’t buy for the person who had it.”
I think that is exactly my point. And for the record, I dont think the money should go to individuals. I think it should go to opportunity. Building infrastructures, schools and systems that provide clean water. These were the basis of all economic progress. Its not about entitlement at all. Its about simple justice. Justice starts when you stop taking from me.
June 7, 2010 — 1:43 pm
Michael Cook says:
“Name some countries. I’ll look into them this evening.” Give me until tomorrow. My books are at home and I wont get there until late. I will get back to you though.
June 7, 2010 — 1:44 pm
Greg Swann says:
> If I occupy land and choose to use it in a certain way, why do you have the right to take it and use it for what you deem is a higher and better use?
I oppose all forms of involuntary social contact, most especially those that result in material injury. If you unpack that sentence, you will define crime in a way that actually makes sense in real life.
>> “The argument that we like to make to ourselves is that this land was stolen, but that’s a claim that only makes sense if we insist that that land was being husbanded, which, in most cases, it was not.”
> Why is this the case?
Hunter/gatherers and herders don’t occupy land in the way that agrarians and their economic successors do. From our point of view, the property use of most Native Americans, especially those of the second migration, was closer to easement, rather than to ownership — often with more than one party claiming the right of easement. This doesn’t make the way that much of that land was taken just, but it does make the resulting injury quite a bit smaller than was claimed. Identity groups have become adept at milking the guilt of prosperous Americans, but it remains that every habitable parcel of the earth has been taken by force again and again. The Hopi don’t live where they do because they feared European marauders. I’m not apologizing for any of this, but it is what it is.
> If I occupy land, I have the right to do with it what I please.
You have the right to own, use and enjoy your property — fixed or movable — to the exact extent you can defend it. This is another very important distinction.
> I dont see how this meshes with your principles of my freedom to be who I am without being disturbed by you.
Your use of the word “freedom” is confusing. Would you say that you have the capacity to live in a state of impervious impregnability? This is not how human beings are made. If you present no peril to me, I will be better off — and, more significantly, a better person — if I leave you alone. But there is nothing in nature that prevents me from trying to steal your stuff or exploit your labor. This is why we need the philosophy of ethics, because we are capable of doing many more things than we ought to do.
> France should cancel the current debt they imposed by force on a country they enslaved, no?
Haiti should have renounced the debt. Never should have made the bargain in the first place. Every slave should kill his slave-masters at the first opportunity. Slavery is only practicable because slaves treasure mere existence above life as a free human being. This goes for all of us, as well, sad to say.
> Furthermore, how do you make up for the $150MM franc opportunity costs? These are sins of the father that continue today.
No one can encumber a non-volunteer with an unchosen debt. Individual Haitians successfully renounce the debt by emigrating — a commendable policy.
> More on this later, but it seems that if I start with $100, its easier to make $1,000, than if I start with zero. My premise here has been, since I took your $100 to make $1,000, at the very least, I should give you $100 to let you have an opportunity to make your $1,000.
You can do what you want with your own money. As soon as you make claims on my money, we have a problem. I took nothing from no one.
>> “To the contrary, free enterprise is precisely what those people need. They are poor for no other reason than that they are not permitted by their thug governments to profit from the use of their minds. To the contrary, free enterprise is precisely what those people need. They are poor for no other reason than that they are not permitted by their thug governments to profit from the use of their minds.”
> I think this is a common misconception. While there are certainly incidents of government takeovers, genocide and the like, there are many governments in the Sub-Saharan Africa that are not corrupt, where people can own their own land without fear of a taking.
I had never paid any attention to this until yesterday, but, as I pointed out last night, the situation is exactly what I expected: Haiti and other desperately poor countries are poor because free enterprise is prohibited, by perverse philosophies and by corruption, with the two phenomena almost always found working together hand-in-pocket. Again: Poor people need free enterprise. With it, they prosper. Without it, they starve.
> These people are not lazy in the least bit.
I endorse this statement 5000%. We have a lot of Sudanese and Somali refugees in Phoenix, and they are an inspiration to everyone who loves life. How lucky for them to live in a place where hard work still pays off — and where no one is trying to exterminate them!
> I said early, I thought everyone was entitled to food, shelter, and clothing. Let me amend that, how about everyone is entitled to the means to produce adequate food, shelter, and clothing.
Each normal homo sapiens is born with a brain. If that brain is cultivated — which is not a necessary consequence — the resulting human being will have all he can be said to be entitled to with which to produce wealth. If you or others wish to help that person by charity, that’s your business. If you propose to steal my wealth, you must expect me to defend it. No one is entitled to someone else’s mind, life, property or labor. This doesn’t mean your life of crime won’t persist for a while, but, sooner or later, either I will kill my despoilers — a slave rebellion — or stop producing wealth — as with Haiti, Africa and the unemployable youth of contemporary America.
You have the capacity to try to steal my property, but you do not have the capacity either to prevent me from resisting you — ideally unto your demise — nor do you have the capacity to cause me to create new wealth for you to steal.
Other people can accept property stolen from me instead of producing their own wealth, but they will not thereby become wealth-productive people. If they elect to live on nothing but hand-outs, they will perish when the flow of hand-outs stops. I think this is the second cruelest element of the entitlement mentality. The cruelest, by far, is robbing those people of the Splendor that accrues only from the achievement of valuable human goals.
In both cases, you and your supposed beneficiaries will be acting contrary to the actual nature of human beings, as volitionally-conceptualizing biological entities — free moral agents. This is something you can do, much as you can throw a puppy like a baseball, but you are acting in defiance of the actual, unchangeable nature of humanity, and, in consequence, the results you achieve will be sub-optimal. At a minimum, you will turn sovereign souls into pitiable, mewling animals. And, at the worst, you and all of them will perish. This is a very poor survival strategy.
> Kick start the infrastructure and then let capitalism work makes perfect since to me, but obviously that will require some outside investment.
If it’s freely offered, I have no problem with it. If it’s stolen, you are destroying free enterprise, not engendering it.
June 8, 2010 — 11:42 am
Michael Cook says:
Jim,
“Somehow you think that a $100 can be given on one side of the transaction, without an attendant $100 missing from somewhere else.”
Agreed, so what do we do about the fact that we continue to receive $100? Furthermore, what do I do when I can no longer say that someone else did it, so its not my fault. What about when I can quantify all the debt payments that happened in my life time that came directly from people who could not afford to make and should not have had to make these payments? In your own words, the money came from somewhere. If it goes to the government, then it should come from the government, no?
June 7, 2010 — 2:28 pm
Michael Cook says:
List of countries with free or fairly free populations that would qualify for your capitalism examples, but somehow still remain poor:
Benin, Ghana, Mali, Senegal and a few more that are probably not quite there yet, but close.
My problem with your analysis of countries with free enterprise and wealth is that a poor country is far more vurnerable to a dictator than a country with wealth. Just as you say they are poor and uneducated because they are corrupt, I say they are corrupt because they are poor and uneducated.
Lets start with a country like the Sudan. This place is certainly not free, but why. Its not free because the people are poor and uneducated. If I am poor and uneducated, I am much more likely to give up my freedom for food. Sure, I can look at those people and say, its your own fault for letting a dictator take over your country and run it poorly, but at the end of the day, they dont have the proper education to understand the long term effects.
Furthermore, this remains a chicken and egg situation in my book. If the people are educated and have the means to provide for themselves, they will be far less likely to give up their freedom. Its important to note that I agree with your conclusion, however, I still ask how do we fix it. You cannot simply blame the people and let genocides continue, nor can you go the way of George Bush, attempting to force democracy and capitalism via the military.
Terrorism is clearly better fought with education and direct foreign investment. Of course, you cant have direct foreign investment or education if dictators refuse to allow it. Again, chicken and egg.
June 8, 2010 — 2:36 pm
Greg Swann says:
> List of countries with free or fairly free populations that would qualify for your capitalism examples, but somehow still remain poor:
> Benin, Ghana, Mali, Senegal and a few more that are probably not quite there yet, but close.
This is how those countries stack up on the Index of Economic Freedom:
Ghana, 87th out of 179, rated 60.2 out of 100, moderately free.
Mali, 112th out of 179, rated 55.6 out of 100, mostly unfree.
Benin, 115th out of 179, rated 55.4 out of 100, mostly unfree.
Senegal, 119th out of 179, rated 54.6 out of 100, mostly unfree.
Haiti, 141st out of 179, rated 50.8 out of 100, mostly unfree.
They’re all pretty repressive, spectacularly lousy places to do business. It would be amazing if they were not impoverished. This is all the explanation needed for the phenomena you cite. The author of your book is hustling you with Marxist claptrap.
June 8, 2010 — 5:48 pm
Michael Cook says:
“No one can encumber a non-volunteer with an unchosen debt. Individual Haitians successfully renounce the debt by emigrating — a commendable policy.”
Isnt this a back door taking of land? If as an individual I have to leave my country because I cannot defend it from the unjust and I cannot afford to pay the price to stay, in all respects you have taken my land, no?
“You have the right to own, use and enjoy your property — fixed or movable — to the exact extent you can defend it. This is another very important distinction.”
This does not seem enlightened enough in my opinion. It would make more sense in a truly capitalist society to avoid war and takings at all costs. Consider how WWI and WWII and 9/11 set back global trade on a massive scale. WWI and WWII offically crush Europe and allowed the US to move into the Super Power position.
I agree with you that people can do anything they set their minds to, good or bad, but from a collective and individual good, war and taking of land makes little to no sense.
“If they elect to live on nothing but hand-outs, they will perish when the flow of hand-outs stops. I think this is the second cruelest element of the entitlement mentality. The cruelest, by far, is robbing those people of the Splendor that accrues only from the achievement of valuable human goals.”
Ironically, this seems to be a very European/American ideal. Most people in impoverishes places work extremely hard. While handouts may exist, they dont allow them to sit around doing nothing. Their Splendor is the only thing keeping them alive. If they were aided with education and basic infrastructure, we might see them actually thrive.
“If it’s freely offered, I have no problem with it. If it’s stolen, you are destroying free enterprise, not engendering it.”
I have to run, but this seem to be our biggest point of disagreement.
June 8, 2010 — 2:52 pm
Greg Swann says:
> My problem with your analysis of countries with free enterprise and wealth is that a poor country is far more vulnerable to a dictator than a country with wealth. Just as you say they are poor and uneducated because they are corrupt, I say they are corrupt because they are poor and uneducated.
The smart ones move. This has been America’s advantage since 1620. We’re pissing that advantage away, now, more’s the pity.
> You cannot simply blame the people and let genocides continue, nor can you go the way of George Bush, attempting to force democracy and capitalism via the military.
I vote for neither. I don’t care what you choose to do, so long as you don’t commit crimes against me.
> Terrorism is clearly better fought with education and direct foreign investment.
Islamofascism will be engaged and destroyed by cheap wireless computers, one mind at a time. This will happen while no one is paying attention.
>> “No one can encumber a non-volunteer with an unchosen debt. Individual Haitians successfully renounce the debt by emigrating — a commendable policy.”
> Isn’t this a back door taking of land? If as an individual I have to leave my country because I cannot defend it from the unjust and I cannot afford to pay the price to stay, in all respects you have taken my land, no?
If you say so. My take is that if your dad is a drunk, your mom a weak-willed enabler, your brother a thief and your sister a bitchy whiner, you can stand on principle or move out and get on with your life. If you do anything but the latter, though, in my estimation you’re an idiot. Smart Haitians emigrate. The land is worth less than nothing and the culture is devoted to nothing squalor and death. Incidentally, smart poor people do well to get away from the culture of poverty wherever they live.
>> “You have the right to own, use and enjoy your property — fixed or movable — to the exact extent you can defend it. This is another very important distinction.”
> This does not seem enlightened enough in my opinion.
It’s a statement of fact, Michael. How you feel about it means nothing.
> It would make more sense in a truly capitalist society to avoid war and takings at all costs.
Yes, of course. The United States is a Rotarian Socialist republic — a kinder, gentler form of Naziism.
> I agree with you that people can do anything they set their minds to, good or bad, but from a collective and individual good, war and taking of land makes little to no sense.
Repeating myself: “I oppose all forms of involuntary social contact, most especially those that result in material injury.”
> If they were aided with education and basic infrastructure, we might see them actually thrive.
This is what the Christians missionaries used to do, before they adopted Marxism.
>> “If it’s freely offered, I have no problem with it. If it’s stolen, you are destroying free enterprise, not engendering it.”
> I have to run, but this seem to be our biggest point of disagreement.
For no good reason. My capacity to defend my property, should you try to steal it, or to forebear to create new wealth, should you succeed in stealing it, is a matter of indisputable ontological fact. It matters nothing how you feel about this. But if you act upon me as you should not — by trying to steal from me — you frustrate your own designs. You can’t control me, so you are foolish to try. Wisdom is to be found in acting upon entities as they are, not as you would wish them to be.
I wrote a detailed discussion of the ontology of human liberty earlier this year. If you read that and give it the thought it deserves, you will learn a much better way of interacting with your fellow human beings.
June 8, 2010 — 6:50 pm
Michael Cook says:
“The author of your book is hustling you with Marxist claptrap.”
Authors and books, thank you. The arguements I present are based on my own researched philosphy. I only point out John Sachs’ book specifically because he is on the ground doing real work with the people. Thats important to me in an author. As much as I can guess, philosphize, etc. as to why people are poor and what they should be doing differently, I will almost always to defer to someone that has been on the ground with the people. Much like describing a house in words is very different than actually seeing a house, describing poverty and solutions in words, is very different than seeing poverty.
June 9, 2010 — 6:16 am
Michael Cook says:
“>> “You have the right to own, use and enjoy your property — fixed or movable — to the exact extent you can defend it. This is another very important distinction.”
> This does not seem enlightened enough in my opinion.
It’s a statement of fact, Michael. How you feel about it means nothing.”
The point is not whether it is a statement of fact or whether it is not, debateable in my opinion of course, but whether it moves us in a better direction. My point was simply the same as your earlier point of people have the ability to do anything, even things that are not in their best interest.
June 9, 2010 — 6:24 am
Greg Swann says:
> but whether it moves us in a better direction.
It were well, I would think, if one is actually in doubt about the causes of human prosperity, to look at countries where things have changed significantly over time. In countries like India, there has been a strong, enduring and general increase in per-capita wealth and productivity. What has changed? As I mentioned the other day, Tanzania has gone the other way. What changed there? This ain’t rocket-surgery, Michael. Government is by far the greatest peril to human life. The more of it there is, the more people die and the worse they live.
June 9, 2010 — 6:40 am
Michael Cook says:
” “If it’s freely offered, I have no problem with it. If it’s stolen, you are destroying free enterprise, not engendering it.”
Here is where philosphy meets reality in my opinion. Every person has the capacity to defend their wealth and/or freely give it of their own choosing. In reality, however, the costs of defense maybe too high for the amount of the taking.
Easy example. The government makes you pay taxes. At the end of the day, that is a plain and simple taking of your wealth. Some freely give, but most would rather not have some other entity direct their funds. However, you choose not to resist in reality because the costs of resistence is more than the taking of your earned wealth. All told, you work 3 – 5 months for the government and the remainder of the time for yourself. People submit to this philisophical wrong because short of living “off the grid”, its their best option.
You might call this destroying enterprise, but at the end of the day, all societies evolve government to a greater or lesser extent. Given the wide variety of governments the world has seen, it would appear that natural selection is choosing free enterprise, and yet, government still seems to persist. In fact, some could argue that free enterprise could not exist without government. Without the building of infrastructure for trade and defined property laws, it is very hard to create an environment for free enterprise. You have shown that above and I completely agree with it.
People seem to always be willing to freely give to a structure or entity that, when created will have the power to do collective goods and individual wrongs.
Taking that premise one step further, why would people object to that same entity providing much needed infrastructure and education to people that would ultimately become consumers of the goods they produce. Having a better educated, more mobile community would only serve to increase everyone’s quality of life.
“For no good reason. My capacity to defend my property, should you try to steal it, or to forebear to create new wealth, should you succeed in stealing it, is a matter of indisputable ontological fact. It matters nothing how you feel about this. But if you act upon me as you should not — by trying to steal from me — you frustrate your own designs. You can’t control me, so you are foolish to try. Wisdom is to be found in acting upon entities as they are, not as you would wish them to be.”
Here is where I think reality and philosphy collide. I cannot control all of your actions, but I can certainly conntrol some. In fact, if I am careful, I can push you right up to the point where you will share enough of your wealth with me because it is not worth the costs to you to defend it. Here, I dont care about your right or wrong.
If my design is to benefit everyone, by providing those without simple infrastructure and education, than that is all the better. Everyday, people submit to takings all forms of government. And they will continue to do so, as long as you dont push them too far.
This is also my point on corruption. Philosphy aside, if you are hungry and I provide you food, you will be more than happy to submit your mind to my miseducation and your wealth to my coffers because of that miseducation.
People submit to governments because they can ultimately provide something. If I own land, it can be taken by two or three, but if my neighbors help it cannot. But by the same token, if I work with my neighbors, we can take more than two or three plots of land at once to create even greater wealth. If 1 + 1 = 3 than surely 2 + 2 = 10 and so on.
If we speak philosphically, I would submit that it is better for me to take enough of your wealth to give everyone the potential to create wealth. All people would actually be better off. Just think if everyone had the same opportunities that the US provides. Education, roads and clean drinking water can do just that in places that are even moderately free. If dictators cannot provide basic needs, they will not be in power for long. If you cannot control my mind because I am educated, you will not control my wealth.
Forget about hand outs, I am talking about foreign investments in places ripe for change. Corruption exists because the people are poor and uneducated. Take a moderately free place, add education and infrastructure and watch it become totally free.
If I speak realistically, you can resist me, but you wont. You have shown in the past that you will if I push you too far, but if I am careful you will not.
June 9, 2010 — 7:07 am
Michael Cook says:
“Ghana, 87th out of 179, rated 60.2 out of 100, moderately free.
Mali, 112th out of 179, rated 55.6 out of 100, mostly unfree.
Benin, 115th out of 179, rated 55.4 out of 100, mostly unfree.
Senegal, 119th out of 179, rated 54.6 out of 100, mostly unfree.
Haiti, 141st out of 179, rated 50.8 out of 100, mostly unfree.”
Make no mistake, I dont mean to claim these societies are perfect, but rather, they have governments that have shown themselves open to aggressively implementing positive changes for the people. Contrast this to the Sudan, where the government has proven themselves to be the enemy of the people. The poor and uneducated are easily swayed and you will no doubt find cruel dictators in every country’s history. Fuedalism in Europe was siimilar, but it should be noted that freedom came with education.
June 9, 2010 — 7:13 am
Michael Cook says:
“The author of your book is hustling you with Marxist claptrap.”
This is equally funny because at one point I wanted to work for the World Bank. A good part of my college education was dedicated to discussing these issues both in philosphy and reality.
I will never forget my first class in poverty. The professor asked us how we should rebuild Afganistan after the war. My first question was, “What are they good at, what can they export.” I assumed that starting with the basic Econ 101 comparative advantage questions would get me to an easy solution.
My professors simple reply was “They are good at fighting and they can export drugs.” Hard to build a strong economy on that. Lets just say, I threw Econ 101 out the window after that. I definitely identify with each point you make, but reality and philosphy dont always mix.
June 9, 2010 — 7:27 am
Greg Swann says:
> I cannot control all of your actions, but I can certainly control some.
That’s false, as you admit a few words later:
> you will share enough of your wealth with me
All purposive human behavior is exclusively internally motivated. You cannot control anyone but yourself.
> they will continue to do so, as long as you dont push them too far.
Explicit admission of the above argument. I am very much hoping that we are living through the early innings of a full-blown slave rebellion.
> People submit to governments because they can ultimately provide something.
People submit to governments out of fear — they fear punishment or death more than they value their own unalterable sovereignty.
> If dictators cannot provide basic needs, they will not be in power for long.
Starvation is the job-protection plan of all dictators. This is news to no one.
> Here is where I think reality and philosophy collide.
Where your ideas conflict with reality, it is not reality that’s wrong. The trouble you’re having is in your hierarchy of values: The end products of free enterprise would be good for the impoverished victims of thugs, therefore let us undermine free enterprise as a means of engendering it.
There’s more. Your aid scheme, like all the others, is a cargo cult: Mimicking the end consequences freedom creates freedom. You understand factually that human beings are exclusively self-controlled, yet you insist that you can sneak around this fact if you are tricky enough. So what if you can? Is this an optimax strategy for dealing with other people, or would you and they all be better off if you acted upon them according to what you already understand is their true, undoubted, unchangeable ontological nature?
This is all just bad thinking on your part. You can correct it, but you need to put your philosophical house in order.
If you want, you can invite your professors here. Jim Klein and I have worked in this agora for thirty years. We can take anybody apart.
June 9, 2010 — 2:05 pm
Jim Klein says:
“Here is where I think reality and philosphy collide. I cannot control all of your actions, but I can certainly conntrol some.”
You can only control any of his actions through the use of brute force. This too is a simple ontological fact. No action has ever been taken by any functional person except pursuant to the operation of his own Central Nervous System.
This is a FACT and the only way you can make that body move otherwise is to forcefully make it happen. So now the question is, why are you arguing that it’s proper to force others when their nature is that they are designed to be (that is, are functional as) a singular organism motivated by its own CNS?
“I definitely identify with each point you make, but reality and philosphy dont always mix.”
If you’ve got some function of philosophy other than correctly integrating reality, then I for one would like to hear it. Otherwise, if they’re not “mixing,” then either the philosophy has to change, or reality has to change. Just offhand, which makes more sense to you?
June 9, 2010 — 12:11 pm
Michael Cook says:
“If you want, you can invite your professors here. Jim Klein and I have worked in this agora for thirty years. We can take anybody apart.”
My professors did a lot of work with the World Bank and governments in developing countries. I think you would be hard pressed to sell them on your philosphy without have attempted your program in an impoverished country. The key learning for me at the end of all of the classes: Something can make perfect sense on paper, but may never work because of simple human behavior. People can do as they wish and not all people are motivated it the same manner. Capitalism and Free Enterprise are surprisingly not always the answer right away. It was a hard lesson for me to learn because it doesnt make sense. At the end of the days it about moving people from one set of ideals to another. Undoing generations of thinking takes time, effort and money.
June 10, 2010 — 8:23 am
Greg Swann says:
> My professors did a lot of work with the World Bank and governments in developing countries.
Good grief. In the 65 years of the foreign aid fad, the only success stories to be found on the face of this benighted globe are the countries that stopped taking foreign aid and instead got out of the way of entrepreneurs. Your professors could learn a lot here, if they were of a mind to learn anything.
> At the end of the days it about moving people from one set of ideals to another.
And this is precisely what the incentives of the free enterprise system do.
I think you have nothing left to stand on but a sort of religious faith.
June 10, 2010 — 9:19 am
Michael Cook says:
“I think you have nothing left to stand on but a sort of religious faith.”
Its funny because that is exactly what I would say about you and your position.
“Your professors could learn a lot here, if they were of a mind to learn anything.”
And vice versa to be sure.
June 10, 2010 — 10:10 am
Greg Swann says:
> Its funny because that is exactly what I would say about you and your position.
The argument I make is logically derived from an understanding of human identity that you have conceded to be true in every particular. The theory of economic development I argue for has been borne out in reality consistently, without contradiction — as would be expected from an accurate philosophical theory.
By contrast, your proposals emerge from a deliberate betrayal of your own understanding of human identity. In practice, the methods you propose have consistently failed to produce the results you seek.
What I’m doing is philosophy. What you’re doing is religion — repeated incantations of dogma in defiance of overwhelming evidence. Your business, but it doesn’t do to conflate the two.
June 10, 2010 — 10:47 am
Michael Cook says:
Thanks for the discussion guys, its been productive. I certainly agree with a lot of what was said here, but we will continue to fundamentally agree on how we move everyone to a free enterprise system, particularly in the face of those who benefit from having them captive.
Some day I would love to focus on this more from an “on the ground” perspective rather to really experiment with my own philisophical perspective which is probably not as generous as I portrayed here.
June 10, 2010 — 10:16 am
Greg Swann says:
When I was in high school, I was part of a Junior Achievement company called Purrifco. There were about 20 teenagers in the company. Our adult mentors were from Peterson-Puritan, a local canning company. I served as the Vice President of manufacturing. In the two years I was involved, we made two hugely profitable products. One of them — a windshield de-icer — was invented by one of the mentors, but the other, which we could sell at at a 1000% mark-up, was created by our V.P. of Finance — a fifteen-year-old.
In exchange for two hours of manufacturing a week and maybe four or five hours of selling time on the weekends, we were each making around $400 a week — in the 1970s. I had other jobs, so I always had a lot of money when I was young, but every kid in that company had a ton of money while were a part of it.
JA has long since abandoned that model of teaching free enterprise by doing free enterprise. By now JA is just besuited business people going into classrooms to bore kids to death — with the real purpose being to give the teacher a day off from boring kids to death. As you might imagine, the modern incarnation of JA changes few lives.
But that basic idea presents an opportunity for you to test your theories, if you want. You could go into two different high schools, setting up an old-style JA company in one, pursuing the World Bank catechism in the other. At the end of one semester, you’ll know which method produces the most wealth for real, living people. Even more interestingly, you’ll see which method results in more great ideas being originated by the students themselves — and more enthusiasm for the future and for life in general.
I know for a fact that you can’t give another person self-love, which is the seed of all human greatness. The greatest curse of charity is that it robs its victims of their own capacity for self-adoration. I know you know this, given who you are and what you’ve already done with your life. Wouldn’t it be a great thing to share that part of your eduction?
June 10, 2010 — 11:32 am
Louis Cammarosano says:
Anyone ever considered the irony of the “affordable housing” mantra as the raison d’etre of government sponsored (not free enterprise) fannie and freddie as being one of the culprits (along with of the artifically low interest rates of the government charted yet private bank-the Federal Reserve) for the higher home prices of our recent housing bubble?
Clearly only “government” enterprise not “free” enterprise could have caused such an historic bubble
June 10, 2010 — 8:57 pm
Chris Johnson says:
Michael: name 3 world bank success stories….
June 19, 2010 — 11:06 am