Dakryn's Batshit Theory of the Week

[zabu of nΩd]

Holy fuck, has Pat finally managed to teach Dak something of classical economics?

 

[Dak]

I could take a long time to answer the first part, but a short answer would be limited to the fact that in a free market , accumulated capital can be lost nearly as easily as it is gained unless the entrepreneur has just as much success investing as a capitalist as he or she had as a entrepreneur. If capitol made one all-powerful, companies wouldn't need to seek regulatory protection etc.

The qualification is something else entirely, as was the mention of resource depletion.

 

[Einherjar86]

Holy fuck, has Pat finally managed to teach Dak something of classical economics?

I doubt any "classical" economists would agree with anything I said.

I could take a long time to answer the first part, but a short answer would be limited to the fact that in a free market , accumulated capital can be lost nearly as easily as it is gained unless the entrepreneur has just as much success investing as a capitalist as he or she had as a entrepreneur. If capitol made one all-powerful, companies wouldn't need to seek regulatory protection etc.

Capitalism encourages individuals to protect their wealth; after all, if their wealth is their property, then they have the right to protect it. Initially this will take the form of private security companies; but inevitably it will take the form of more complex regulatory policies.

The very notion of "property" encourages protectionism.

 

[Dak]

Capitalism encourages individuals to protect their wealth; after all, if their wealth is their property, then they have the right to protect it. Initially this will take the form of private security companies; but inevitably it will take the form of more complex regulatory policies.

The very notion of "property" encourages protectionism.

It can, but protectionism can happen even when property is communal (IE, stereotypical tribalism). This was the purpose of things like Guilds (in an early time). However, examples such as Guilds always required a government to enforce the monopolies.

Companies can get together and streamline various things like having standard measurements etc. This does not preclude someone else from coming along and flaunting these standards (Such as Apple vs PC).

If a group decides to start behaving like a government and using violence to coerce others into compliance, what we have is organized crime, not "the market a work". People freely associating and trading does not protect them from people attempting to prevent it, just like living doesn't protect you from being murdered.

 

[Einherjar86]

It can, but protectionism can happen even when property is communal (IE, stereotypical tribalism). This was the purpose of things like Guilds (in an early time). However, examples such as Guilds always required a government to enforce the monopolies.

I just want to mention that I'm not trying to argue for a communist society; I'm merely trying to delineate what I see as the illogical structure of a truly "free" market capitalist society.

Protectionism can happen anywhere because individual human subjects can certainly think: "I earned this money... I harvested this land... I own this property... and I want to protect it." My point is: free market capitalism, which encourages the value of individualism and private property, actually perpetuates protectionism by its very definition.

Companies can get together and streamline various things like having standard measurements etc. This does not preclude someone else from coming along and flaunting these standards (Such as Apple vs PC).

If a group decides to start behaving like a government and using violence to coerce others into compliance, what we have is organized crime, not "the market a work". People freely associating and trading does not protect them from people attempting to prevent it, just like living doesn't protect you from being murdered.

I find the line between "free market" and "organized crime" extremely arbitrary. I don't see how you can draw such a line that avoids any kind of theoretical moralizing; and furthermore, it's completely artificial to declare that organized is not the "market at work." That's your definition, which you've absorbed from free marketeers.

In my opinion, if you follow the logic of laissez-faire capitalism, you inevitably arrive at "organized crime" because successful individuals will be drawn toward methods that continue to promote their own success. You want to continually draw some arbitrary line at coercion, but the very values that capitalism espouses actually encourage coercion. It's a contradictory set of values.

 

[Dak]

I just want to mention that I'm not trying to argue for a communist society; I'm merely trying to delineate what I see as the illogical structure of a truly "free" market capitalist society.

Protectionism can happen anywhere because individual human subjects can certainly think: "I earned this money... I harvested this land... I own this property... and I want to protect it." My point is: free market capitalism, which encourages the value of individualism and private property, actually perpetuates protectionism by its very definition.

That's like saying living perpetuates murdering. Just because conditions are available doesn't mean it's perpetuated. May as well cars perpetuate drinking and driving, etc.

I find the line between "free market" and "organized crime" extremely arbitrary. I don't see how you can draw such a line that avoids any kind of theoretical moralizing; and furthermore, it's completely artificial to declare that organized is not the "market at work." That's your definition, which you've absorbed from free marketeers.

In my opinion, if you follow the logic of laissez-faire capitalism, you inevitably arrive at "organized crime" because successful individuals will be drawn toward methods that continue to promote their own success. You want to continually draw some arbitrary line at coercion, but the very values that capitalism espouses actually encourage coercion. It's a contradictory set of values.

All do not inevitably end at organized crime. Of course some will end there, just as there will always be some murderers, some rapists, etc. There is a big difference between "it will end there" and "a few will end there". To say that free market economics encourages coercion is trying to flip the entire edifice on it's head with a questionable use of the word "encourage".

If there are people in existence, all sorts of unethical behavior is "encouraged" that would not be so in their absence. This isn't an argument against anything. The flaws in humanity must be accepted and accounted for.

Any form of statism accepts and accounts for these flaws by instituting arbitrary ones them and forcing them at large upon the respective populations. Unless you want to consider the demand to own the fruit of one's labor as a flaw, your argument in this direction doesn't seem to be going anywhere at all. Conversely, if it is a flaw to require the fruits of one's labor (ethical or unethical in itself), then humanity would surely die quickly, as one could not ethically even consume a morsel of food.

 

[Einherjar86]

That's like saying living perpetuates murdering. Just because conditions are available doesn't mean it's perpetuated. May as well cars perpetuate drinking and driving, etc.

These are equivocations. Drinking and driving, and murder, have little (if any) justification from a pre-existing set of values. Protecting one's property via coercive means appears to be justified, however, by the very values of a free market system.

All do not inevitably end at organized crime. Of course some will end there, just as there will always be some murderers, some rapists, etc. There is a big difference between "it will end there" and "a few will end there". To say that free market economics encourages coercion is trying to flip the entire edifice on it's head with a questionable use of the word "encourage".

The very right of property entails that individuals may take measures to protect their own. Protection can take many forms, including preemptive measures against competitors. Judging from your perspective, these preemptive measures violate the well-being of other individuals; but they are also justified by the right to protect one's property.

If there are people in existence, all sorts of unethical behavior is "encouraged" that would not be so in their absence. This isn't an argument against anything. The flaws in humanity must be accepted and accounted for.

Any form of statism accepts and accounts for these flaws by instituting arbitrary ones them and forcing them at large upon the respective populations. Unless you want to consider the demand to own the fruit of one's labor as a flaw, your argument in this direction doesn't seem to be going anywhere at all. Conversely, if it is a flaw to require the fruits of one's labor (ethical or unethical in itself), then humanity would surely die quickly, as one could not ethically even consume a morsel of food.

I don't think there is any metaphysical or ethical axiom that grounds the right of individuals to the fruits of their labor. The only thing that qualifies this stance is that all individuals seem to want to keep the fruits of their labor; but this is little better than some kind of Kantian transcendental subjectivism.

The better position is that there is no inherent right to one's property; certainly we all want to keep and maintain our property, but this doesn't mean there's some deity, or substrate to the universe that ensures this right. It's simply the way human subjects operate. Individuals pursuing the maintenance and success of their own properties and enterprises cannot coexist without coming into open conflict. Protectionism is the norm because individuals want to protect what is "theirs."

I'm going to use a brief quote from Alain Badiou to illuminate what I think is the crux of the issue:

In itself, the economy is neither good nor bad; it is the place of no value (other than commercial value, and of money as general form of equivalence). It simply 'runs' more or less well. Routine politics is the subjective or valorizing moment of this neutral exteriority.

By "neutral", Badiou means that the economy is value-less; it is nihilistic. Politics is the material manifestation of projected values, in the form of institutions, that attempt to impose and enforce said values.

You're looking for a middle-ground: an economics, a "free" market, absent any political institutions but with a common and universal code of values nonetheless. You don't want a nihilistic market (which is, actually, what the market as pure human transaction and interaction is), but neither do you want a political market. The problem is as soon as you conceive of a market system that proports a universal set of values, you're already in politics. The only way to avoid this is to suggest that the market is value-less. And, in this way, it becomes apparent that "free market ethics" is not a universally applicable form, but merely one set of values among infinite others. It doesn't allow for multiple ethics and values, because it is merely one set of ethics and values.

It might sound as though I'm suggesting that there is no such thing as truth or ethics, but that's not the case. I'm suggesting that ethics is value-less; it is nihilistic. That is to say, it is momentary, situational; or, not universal. There is no set of ethics that subsumes all others.

 

[Dak]

These are equivocations. Drinking and driving, and murder, have little (if any) justification from a pre-existing set of values. Protecting one's property via coercive means appears to be justified, however, by the very values of a free market system.


The very right of property entails that individuals may take measures to protect their own. Protection can take many forms, including preemptive measures against competitors. Judging from your perspective, these preemptive measures violate the well-being of other individuals; but they are also justified by the right to protect one's property.

There is a difference between protecting property and protecting interest. Example: If you write literature critiques and make a good living doing so, and then I come along and write critiques that are more readily received than yours, this does not reduce your actual work in anyway. When people freely associate, part of that association is trade. The market is merely the sum of those trades, those transactions, whether there is money involved or not. A free market in ideas, a free market in commodities, etc.

Protectionism is not protecting one's property, but limiting the association of others, and forcing them to associate in a way that benefits the advocate over others. So if you were upset that people were not buying/reading/endorsing your work (which in no way affects the work itself), instead of improving your work or finding some other outlet, you instead seek methods to prevent me from either producing my own work or some way of funneling some of my benefit to yourself.

I don't think there is any metaphysical or ethical axiom that grounds the right of individuals to the fruits of their labor. The only thing that qualifies this stance is that all individuals seem to want to keep the fruits of their labor; but this is little better than some kind of Kantian transcendental subjectivism.

The better position is that there is no inherent right to one's property; certainly we all want to keep and maintain our property, but this doesn't mean there's some deity, or substrate to the universe that ensures this right. It's simply the way human subjects operate. Individuals pursuing the maintenance and success of their own properties and enterprises cannot coexist without coming into open conflict. Protectionism is the norm because individuals want to protect what is "theirs."

You are equivocating protecting property with protecting interests. While people do attempt to do that, that's not a justification, just as a desire for sex doesn't justify rape. Protectionism sees the actions of others as owned, because it inhibits free association. Now this language is common IE "He's stealing MY customers." But unless the speaker believes the customers are his slaves, this statement is uneducated/illogical at best, and a mere expression of envy at worst.

By "neutral", Badiou means that the economy is value-less; it is nihilistic. Politics is the material manifestation of projected values, in the form of institutions, that attempt to impose and enforce said values.

The market is nihilistic, if I understand your statement correctly. This is a position of Austrianism. There is nothing wrong with institutions and promotion of values. It is the manner of those institutions and promotions. It's the difference between donation and taxation, between lovemaking and rape. It might look identical on the surface, but be entirely different.

You're looking for a middle-ground: an economics, a "free" market, absent any political institutions but with a common and universal code of values nonetheless. You don't want a nihilistic market (which is, actually, what the market as pure human transaction and interaction is), but neither do you want a political market. The problem is as soon as you conceive of a market system that proports a universal set of values, you're already in politics. The only way to avoid this is to suggest that the market is value-less. And, in this way, it becomes apparent that "free market ethics" is not a universally applicable form, but merely one set of values among infinite others. It doesn't allow for multiple ethics and values, because it is merely one set of ethics and values.

It might sound as though I'm suggesting that there is no such thing as truth or ethics, but that's not the case. I'm suggesting that ethics is value-less; it is nihilistic. That is to say, it is momentary, situational; or, not universal. There is no set of ethics that subsumes all others.

While the market, as in, the sum of transactions is valueless, economic laws are not. It appears you are using economics and the market interchangeably, and they are two different things.

 

[Einherjar86]

There is a difference between protecting property and protecting interest. Example: If you write literature critiques and make a good living doing so, and then I come along and write critiques that are more readily received than yours, this does not reduce your actual work in anyway. When people freely associate, part of that association is trade. The market is merely the sum of those trades, those transactions, whether there is money involved or not. A free market in ideas, a free market in commodities, etc.

Protectionism is not protecting one's property, but limiting the association of others, and forcing them to associate in a way that benefits the advocate over others. So if you were upset that people were not buying/reading/endorsing your work (which in no way affects the work itself), instead of improving your work or finding some other outlet, you instead seek methods to prevent me from either producing my own work or some way of funneling some of my benefit to yourself.

Some people might interpret that as protecting their own property. I'll explain more below.

You are equivocating protecting property with protecting interests. While people do attempt to do that, that's not a justification, just as a desire for sex doesn't justify rape. Protectionism sees the actions of others as owned, because it inhibits free association. Now this language is common IE "He's stealing MY customers." But unless the speaker believes the customers are his slaves, this statement is uneducated/illogical at best, and a mere expression of envy at worst.

Here we run into the problem of the body as property. An individual's body is no one's property but her own: that I agree with. Thus, an individual has the right to preserve and protect her body at all costs. If protecting one's interests is viewed as the best - or only - option to preserve one's existence, then that individual is obliged to do so in order to protect the property that is her body.

I'm not saying this is right, or that we should all simply enjoy others as we see fit (which was what Sade argued, extremely convincingly, by following Kant's logic on morality). Rather, I'm suggesting that what you're saying encounters a paradox if the body is also property, which I believe it is.

The market is nihilistic, if I understand your statement correctly. This is a position of Austrianism. There is nothing wrong with institutions and promotion of values. It is the manner of those institutions and promotions. It's the difference between donation and taxation, between lovemaking and rape. It might look identical on the surface, but be entirely different.

While the market, as in, the sum of transactions is valueless, economic laws are not. It appears you are using economics and the market interchangeably, and they are two different things.

This helps me to clarify some of my vocabulary; I am using the market and economic law interchangeably, so I'll try and refrain from doing so now.

Economic laws certainly aren't valueless, since in order for them to be posited as "laws" they must operate via some universally recognized set of values. Thus, they must presuppose a specific ethics; but applying the ethics of laissez-faire economics universally (by naturalizing them) suggests that these values are inherent in the world, and thus in the market.

If the market is valueless, then no one set of economic laws can be said to be "right" or "best."

 

[Dak]

Some people might interpret that as protecting their own property. I'll explain more below.



Here we run into the problem of the body as property. An individual's body is no one's property but her own: that I agree with. Thus, an individual has the right to preserve and protect her body at all costs. If protecting one's interests is viewed as the best - or only - option to preserve one's existence, then that individual is obliged to do so in order to protect the property that is her body.

I'm not saying this is right, or that we should all simply enjoy others as we see fit (which was what Sade argued, extremely convincingly, by following Kant's logic on morality). Rather, I'm suggesting that what you're saying encounters a paradox if the body is also property, which I believe it is.

I don't have time to go in depth with this at the moment, but perhaps this piece from Bastiat will help, in regards to protectionism and interests:

http://mises.org/daily/6239/God-Protect-Us-from-Metaphors

This helps me to clarify some of my vocabulary; I am using the market and economic law interchangeably, so I'll try and refrain from doing so now.

Economic laws certainly aren't valueless, since in order for them to be posited as "laws" they must operate via some universally recognized set of values. Thus, they must presuppose a specific ethics; but applying the ethics of laissez-faire economics universally (by naturalizing them) suggests that these values are inherent in the world, and thus in the market.

If the market is valueless, then no one set of economic laws can be said to be "right" or "best."

Economic laws are definite. "Right" and "best" depends on the purpose, but regardless of the subjective valuations, there are limits to what one can do when the laws are ignored. For the purposes of concentrating wealth and leeching from the masses, the current system works quite well for a time. Like all Ponzi schemes, there are limits to the manipulation. Any economic system built on "robbing Peter to pay Paul" hits the wall when Peter is out.

 

[Einherjar86]

I don't have time to go in depth with this at the moment, but perhaps this piece from Bastiat will help, in regards to protectionism and interests:

http://mises.org/daily/6239/God-Protect-Us-from-Metaphors

I understand the difference between a transaction that occurs freely between two consenting parties, and the forceful removal or exchange of funds. I'm not arguing for the latter. I'm saying that the logic of free market values can be followed to such an end that individuals may arrive at a justification for coercive action.

I'm not complaining that capitalism doesn't guarantee prosperity and material equality for all individuals.

I'm not complaining that it doesn't guarantee an absence of violent action.

I'm saying that if one follows the logic of rights to property and existence through to their very end, a justification can be made for coercive action if it improves or guarantees the well-being (i.e. survival) of a human subject. I agree that individuals have some sense of these rights; I don't want anyone to take my books, and I want to be acknowledged for the articles that I write. But that doesn't mean I can ignore that there is a very troubling paradox at the heart of the right to one's property: if my body is my property, and my body is in danger or is lacking, I have the right to preserve/improve it. If I do so at the expense of other individuals, I've followed the principles of property while simultaneously invading or manipulating the property of others. There's no distinct line that can be drawn here because the theoretical model is being followed and violated at the same time.

Economic laws are definite. "Right" and "best" depends on the purpose, but regardless of the subjective valuations, there are limits to what one can do when the laws are ignored. For the purposes of concentrating wealth and leeching from the masses, the current system works quite well for a time. Like all Ponzi schemes, there are limits to the manipulation. Any economic system built on "robbing Peter to pay Paul" hits the wall when Peter is out.

At the risk of being redundant, there are also limits to what one can do when these laws are followed. But again: I'm not saying that an economic Ponzi scheme is preferable to capitalism. I'm not not arguing for any kind of collectivist or nihilistic model of economic theory. All I'm saying is:

The values of capitalism can be used to justify coercive action. Thus, one can act according to free market values while simultaneously acting in opposition to them.

 

[Dak]

I understand the difference between a transaction that occurs freely between two consenting parties, and the forceful removal or exchange of funds. I'm not arguing for the latter. I'm saying that the logic of free market values can be followed to such an end that individuals may arrive at a justification for coercive action.

I'm not complaining that capitalism doesn't guarantee prosperity and material equality for all individuals.

I'm not complaining that it doesn't guarantee an absence of violent action.

I'm saying that if one follows the logic of rights to property and existence through to their very end, a justification can be made for coercive action if it improves or guarantees the well-being (i.e. survival) of a human subject. I agree that individuals have some sense of these rights; I don't want anyone to take my books, and I want to be acknowledged for the articles that I write. But that doesn't mean I can ignore that there is a very troubling paradox at the heart of the right to one's property: if my body is my property, and my body is in danger or is lacking, I have the right to preserve/improve it. If I do so at the expense of other individuals, I've followed the principles of property while simultaneously invading or manipulating the property of others. There's no distinct line that can be drawn here because the theoretical model is being followed and violated at the same time.

Through any twisting of a given thing one can push it through to it's opposite. The portion I emboldened is where the part of the problem is. "Lacking" can mean anything, and doesn't tie directly to being in literal danger in any way. Even "danger" can be twisted due to my next point. A second portion and really foundational to the twisting refers back to a mistaken understanding of property (my customers, my sales, etc.).

At the risk of being redundant, there are also limits to what one can do when these laws are followed. But again: I'm not saying that an economic Ponzi scheme is preferable to capitalism. I'm not not arguing for any kind of collectivist or nihilistic model of economic theory. All I'm saying is:

The values of capitalism can be used to justify coercive action. Thus, one can act according to free market values while simultaneously acting in opposition to them.

I can use just about anything to justify anything with enough twisting. As an example: How many atrocities have occurred while purportedly falling under "Just War Theory"? While there are issues with the Just War Theory, we've never really seen anything that even fits in it.

I know you and Cyth have already stated that ownership of property (specifically land) can be deemed coercive/aggressive against all others ability to own and/or use it. This is the point of the use/occupancy ownership contingency. What you really own is not so much the land but the product of your labor which you have mixed with the land when you homestead, set up shop, etc.

While it may not be [fair] that someone could have achieved use/occupancy of a given tract of land prior to your cognizance and/or arrival of/at the place, that is simply a fact of life. Some are born before others, some are born in different places. Carrying the former logic to it's conclusion, existing is aggression/coercion against your "right" to breath particular air particles and stand wherever I happen to be at the moment.

 

[Einherjar86]

You're right! What you just said about carrying that logic to its conclusion results in existence as coercion - that's true. But simply disregarding it because its logic results in absurdity isn't the correct response, in my opinion.

Basing our acceptance of capitalist values on an intellectualized brand of common sense doesn't respond to the problems; it merely sweeps them under the rug. It ignores paradox for security's sake, so that human subjects can go on conceiving of themselves as total and maintaining a sense of comfort in the virtuous nature of their actions. But the very fact that things such as "lack" and "danger" can be infinitely diverse from subject to subject is evidence that a total theory like that of capitalism won't function in the way its theorists claim. Neither will communism.

 

[Dak]

I think reducto ad absurdum is a useful tool. I know this is not a popular opinion.

 

[Einherjar86]

I think it smacks of practicality; which is fine, I like practicality.

 

[Dak]

I think it smacks of practicality; which is fine, I like practicality.

Which is why you may enjoy Bastiat even if you don't find yourself agreeing with his overall positions. His frequent use of reducto ad absurdum on his policy opponents is quite amusing.

 

[Einherjar86]

I shall read his work someday. I tried to check out The Law from BU's library, but it's been misplaced. So instead I grabbed a book called Dialectic of Nihilism: Poststructuralism and Law.

Surprise, I know.

 

[Dak]

Lol. His wit is more on display in "The Bastiat Collection" as opposed to The Law, which is a relatively straight forward framework booklet. One of the few Frenchmen worth a damn in history.

 

[Dak]

To backtrack to the original topic:

Mises put forward the argument that (essentially) a non-capitalist system would fail due to a lack of the information provided by the market, most specifically prices. Of course the target of this economic critique was specifically socialism/communism due to it's era. Regardless of what non-capitalist system utilized or named, this problem still remains. Attempts at various levels of a "mixed economy" run into the same problem but only partially. The heavier the ratio towards socialism, the more problems arise.

Re: No difference between the failing of free markets/communism. This economic difference between a free market approach and some other approach is a major distinguishment between itself other theories/ideologies.

There is certainly requisite a certain amount of reasonableness which will be dependent on place, time, and individuals. I think a anarcho-capitalistic society gives the best chance for resolving inevitable contentions of various sorts due to it's overall flexibility. An understanding of economic laws is critical though to reduce the amount of these misunderstandings, most especially protectionism. To understand we are made mutually and universally richer through division of labor and free trade instead of seeing any success other than our own as limiting or "endangering". Protectionism is a mask for pure envy, to the detriment of all involved. The ultimate point of the work of people like Bastiat is that protectionism actually makes the purported benefactor(s) of protectionist policies poorer in the long run than they would be otherwise. It only makes them temporarily, relatively richer.

 

[viewerfromnihil]

I think you'll get a kick out of this Dak. It was funded by the New Deal.

[ame]http://www.youtube.com/watch?v=2taApjVSogQ&feature=related[/ame]