Monday, September 10, 2012

Free to Choose Round 3: Final Round

This is the third and final round (for me anyway, Keith if you'd like the last word, have at it). Keith response to my second rebuttal is here.

The founding fathers would be considered libertarians given today’s lingo. They spent a lot of time making the US federal government as small ...

Many of the founding fathers were classical liberals, calling them libertarians today is practicing revisionists history. The founding fathers wanted a government that was strong but not tyrannical and that is what they got with the Constitution. They never contested powers arrogated to the state level, it was never even a question, they were only concerned with federal level powers, which is why they enumerated them, except of course that pesky General Welfare clause.

I don’t take complete ownership of her philosophy. She’s a writer...

Fair enough. Good to see you're not a purist.

Collectivist is evil. Liberty is not. Liberty is incorrectly called evil, and collectivist is rightly so...

I don't know of any writings that call liberty evil. Plenty of writings that demonize collectivism though. I also wonder about framing the conversation in such binary terms, good vs. evil. But it is promising to see you say that a mix of freedom and communal action can work at least for primitive societies.

People do fight wars for freedom and democracy. I realize that doesn’t happen that ...You seem to be totally missing the evil of Germany and I find that scary.

Germany was an imperial power, Britain was an imperial power, France, Russia, US, all imperial powers. None of the leadership cared about what was happening to the Jews, or the Chinese, or the Communists. Eugenics and antisemitism was just as popular in the US as it was in Germany. Britain and the rest of the European allies would have done just about anything to avoid a war with Germany. They stood by as he re-armed, then took back the Rhineland, then took Austria, Sudetenland, part of Czechoslovakia, Memel. It wasn't until he attack Poland that Europeans realized his interests wouldn't be sated with a piece of land here and there. FDR campaigned on a platform of staying out of the war but once elected started a PR campaign to convince the citizens that it was the right thing to do. After Pearl Harbor it was an easy thing to do. So while the people believed they were fighting evil (and they were), the leadership only cared about protecting their interests abroad and domestic.

Friedman explained that you can supplement social security with a negative income tax.

I think Friedman argued that a negative tax combined with a flat tax would replace social security, minimum wage laws, food stamps and welfare. Which, if it performs as advertised, would be a pretty good deal and eliminate a lot of social spending.

I use greed because it is a shorthand. I also don’t like using the same words over and over. Acting in your own self interest is definitely not always greedy. It would only be greedy if you always acted in your own self-interest. And the points is that a government can’t know if you are being greedy, so it shouldn’t worry about this issue. Greedy doesn’t mean stealing. Knowing whether someone is stealing doesn’t require knowing teir motivations. It is scary to have government studying your motivations.

I'm just going to comment on the last line as there seems to be some sort of moral firewall I cannot breach. It is scary to have your govt examine your motivations, but you must realize that TNC's are gathering an equally, if not more, intrusive portfolio about you and your habits, all the better to market to you. TNC's also have a nasty habit of sharing this information with the very govt you fear.

Greed is brought up by the left as a way to create a more collectivist society. They pit one class against another and call anyone who isn’t poor as greedy...

Machiavelli once said in his work The Prince "In fact the aim of the common people is more honest than the nobles, since the nobles want to oppress others, while the people simply want not to be oppressed." Please pardon me for using such a statist but in his machiavellian way he speaks the truth. It is never wrong for someone to give voice to the voiceless. The poor have no voice.

Some poor become rich in a free system. It is possible here. My father was poor...

The operative word is "some". Because there is only so much room at the top. I've heard that argument before about the poor with their flat screens and air conditioners. When I was a poor student I bought a computer piece by piece over a period of months and built it myself to save money, I had a small tv, a second hand VCR as well as a playstation that I had bought on credit. I was destitute, but not on welfare and I lived with other students in the same household who had similar things. So from the perspective of a survey our household would be living pretty well for being poor.

Not that Obama is a saint (indeed he just carries on the last administrations agenda) but Romney's job at Bain Capital was to put people out of work by chopping up companies and selling off their assets. Tell me how globalization creates jobs for Americans.

Class is a leftist political construct? Class is what most extant cultures are built upon. Both Adam Smith and Friedrich Hayek wrote about the working class but never identified with them. Even Ayn Rand divided the world up into producers and socialist parasites.

If you have a book to recommend that debunks the concept of class I'd like to read it.

Corporations are people...You have a contradiction in your support for cooperation, but being against corporations.

I've laid out my position quite clearly against corporations. There is no contradiction in being against corporate person-hood and for cooperation. Why do you think sole proprietorships or partnerships are insufficient? Why can investors not assume liability for their investment vehicle?

I see nothing wrong with corporations wanting profit just like I see nothing wrong in my wanting a salary. It takes profits to invest in new products. It is profits that lead to progress. You would like to kill progress!

If asking corporations (and their investors) to take responsibility for their actions kills progress then so be it. It is not the kind of progress I want or need. Corporations are without a doubt destroying the future carrying capacity of our planet. They need to pay or they need to stop. This is not leftist or rightist. This is common sense. To do otherwise is slow suicide.

The problem in Greece aren’t the bondholders. You always have the leftist perspective on history. I can also recommend you read Amity Shlaes The Forgotten Man. The problem is the government spent a bunch of money it didn’t have.

I will, as always, be happy to add another book to the reading list. Let us be clear, you were saying that the Greek people are rioting in the street implying it was the governments fault. I was pointing out that the Greek people are rioting because of austerity measures that the bond holders are insisting on. I won't excuse the Greek Govt's role in this crisis, but I will say that Goldman Sachs acted as the Greek Govt's enablers through an act of fraud to allow Greece entrance into the EU where they could continue to borrow. If that didn't happen, Greece could have devalued their currency and gotten their finances in order (after the Greek people cleaned house politically). Now the Greek people get no relief as the austerity measures are enforced upon them by the EU and IMF. How is that for freedom?

You can decrease the power of government, and therefore the influence of corporations on government. You just pass laws. Once a system is privatized, the “evil” corporations have less power. With smaller government, there isn’t anything for them to exploit. And furthermore, the problem now is generally bad government, not bad corporations. Why is energy expensive? Because Obama is against drilling, nuclear energy, coal, etc. The prices go up not because the corporations are evil, but because the government is restricting the supply.

So with a smaller govt, who passes the laws? Govt? Who enforces the laws? Govt? I assume Govt still has monopoly on force, but how exactly will it keep it if TNC's operating on US soil, hire private security (read: private army). The power is still concentrated with TNC's (i.e. money) and although a small govt with it's now toothless ability to enforce the laws it passes will be equally useless to TNC's, they can act directly in their own self-interest. What government would want to fight a civil war against business? Today business gets govt to wage war on their behalf, in the future, they'll wage it themselves.

You do realize what nuclear, coal, drilling (oil, gas) does to the environment right? You are essentially trading our future for access to energy right now. Again this isn't me being a lefty, this is just the facts.

Libertarians don’t have a backwards view of environmental policy. We believe that if get rid of the government educating and providing healthcare for everyone, it can focus on the few big issues like the environment. This is something that crosses states so it is a federal issue. We want an EPA, just a smaller one.

I think you misread what I wrote. I said that you(libertarians in general) have economics backwards. But reading what you had to say about coal, nuclear and drilling I would say you have a backwards environmental policy too. But I'll give you the benefit of the doubt. Other than privatizing every piece of land, body of water and expanse of air, what is the libertarian environmental plan? Why I am putting privatization off limits is because there is nothing to stop those with money from buying up what they need for exploitative purposes. So your back to law, how are you going to enforce those laws against illegal use by corporations (remember private army).

Your understanding of history is incorrect, and is exactly the anti-capitalist perspective. I don’t know what else you’ve read, but I can say you are mis-educated.

Capitalism has one purpose, to grow by exploiting all resources available. Historically this was necessary to generate enough wealth to allow for specialization of labour and knowledge. I'm not anti-capitalist from historical perspective, I recognize the necessity, I am anti-capitalist from a future perspective. Capitalism is not the last ideology we will have simply for the fact, and again let me underline this is not a left or right perspective, capitalism must grow or it will die, and we are running into hard physical limits, i.e. peak minerals, peak oil, peak population, peak fresh water, etc. Julian Simon's predictions of infinite growth and substitutability notwithstanding (because it is plain silly).

The financial crisis was caused by bad regulation, not deregulation. Your words about globalization I disagree with. We want private insurance. You seem to think there is only government or paying out of pocket, and you forget private insurance.

I agree there was definitely some bad regulation, but as you can see from the timeline here, there was significant deregulation that laid the groundwork for the financial crisis of 2008.

You can disagree with my words on globalization, but that doesn't change what I've demonstrated, that capital chases the lowest cost of labour. How is the manufacturing sector doing in the US since the introduction of NAFTA and the WTO? Gutted I think describes it.

We have private insurance in Canada. I do not ignore private insurance, but in the context of discussing poverty (which we have been doing) private insurance does not figure into the discussion as the poor cannot afford it.

We don’t have to slash benefits to privatize social security. A private system will have a greater rate of return over time. You have the facts backwards, as usual.

Actually that is what would have to happen. Unless you are going to flat out cut the benefits for those already retired, you will be running the systems in parallel with current retirees grandfathered in. Even so, you are going to underfund the SS even further by diverting some of the FICA money to private retirement accounts, accelerating the depletion of the SS Trust, in addition to 600 billion dollars in transition fees (conservative estimate), this means the SS benefits get exhausted sooner unless they are slashed. Lastly a private system that has a greater rate of return over time, assumes a steadily growing economy, which requires an energy source that can steadily grow as well (which seems to be in short supply). So my facts seem to be facing the right way.

Sustainable forestry is in action by private corporations. I live in Washington, and we have it here. Talk might not have been the best word as it could imply no action which I didn’t mean. I just meant that sustainable forestry is the big topic of modern forestry. The government can insist on making something sustainable, but let the private sector figure out how. Etc. Corporations can get smarter and more environmentally friendly over time. Note it takes profits to be able to spend the money to make something environmentally friendly. So when you suggest you want to kill profits, you are also killing environmental progress.

But that is precisely the conflict of interest I am talking about and have been talking about repeatedly. It takes money to be environmentally friendly. Thus it cuts into profits, thus is in direct violation of a CEO's fiduciary duty to act in the shareholders best interests. Such CEO's can be dismissed and replaced.

In public corporations, where directors are elected by the shareholders, directors have a fiduciary responsibility to shareholders to work in the best interests of shareholders and for the benefit of shareholders - and not in the best interests of individual directors or managers. How is that interest and benefit measured? ROI and EPS. It is argued that there is no strict interpretation of US law that says a director must maximize shareholder value (because of the business judgement rule under the duty of care) but directors can be removed by shareholders, CEO's by directors. So it is pretty clear that what the shareholder wants, the shareholder will get.

Planting monocultures to replace old growth diversity isn't environmentally friendly. Mimicking natural stands that takes more effort but is worth more in terms of carbon sequestration and biodiversity preservation. Of course, restoration costs more in time and money than reforestation and may include species that the timber companies deems "valueless".

There weren’t really private pensions before Social Security. At least not as sophisticated as now. It was in 1935 that it was created. It has definitely crowded out private programs and given a lower rate of return. It has hurt the poor more than it has helped them! They pay into this system and it sucks compared to the private pensions, which the rich have as well. It also serves as a means for politicians to keep themselves in power. Vote for me, I’ll protect Social Security. I can suggest you re-read Free To Choose at some point in the future. There is a lot to absorb. He spent a lot of time on SS.

I remember reading that there were not many private pensions before SS. And SS wasn't supposed to be a pension but rather a supplement. Basically what that says is there was no private market for pensions (or private will to fund them), so at the time there was nothing to crowd out. SS grew over time to become more of a pension, but again the corporations were more than happy to outsource that cost as it is mostly paid by the employee. And it doesn't change the fact that for private pensions to work it must make a profit for the managers, else why do it?

The lower rate of return for being invested in special interest bearing federal securities represents the lower level of risk and increases the predictability for future planning. It is certainly true you can get a greater return investing in the market, but you also have to assume a greater downside if the market goes south.

One would have to speculate how much the private industry would love to get their hands on trillions of dollars of investments (think of the fees!). One would also have to wonder more about the most savvy investors raided such a market to milk it for everything that it is worth. If you can assault a countries currency, a pension fund would be easy pickings.

I’m for peace through generosity and strength.

Well that is a start.

There are case studies of cities with failing schools. Check out the DC system as one of the best examples which I think spends $27K per ...

I checked out the DC system and indeed it seems the cost per student is quite indefensible considering the results. So there is a problem, and my first question was to ask where all the money was going to, but none of the articles provided that break down. So while that needs to be fixed, vouchers have the following shortcomings: public money will end up going to religious schools in violation of the separation of church and state and private schools can establish their own admittance criteria (purposely excluding low performers to inflate graduation stats). The first one doesn't bother me much, but the second one does, because face it, you are going to end up with the same tiers in education that you have now, the rich desirable schools and the poor undesirable schools.

So let's dispense with middle schools, high schools, colleges and universities altogether. Who needs credentialism? Teach kids the basics, then let then self-direct their own education. It'll save much money, the government will have little to do with it , it gives a wide range of choices and everyone learns to their own level at their own pace. Doesn't that sound like liberty?

I find a reference to Howard Zinn. A-ha, that explains my theory that you have a leftist perspective of history. His work is filled with half-truths. I’m sure if Friedman were to read it, he’d find tons of things wrong. I did. I can recommend you consider everything you “learned” as suspect.

Howard Zinn wrote the history from the perspective of the oppressed, women, natives, white servants, black slaves and the poor. Which to my knowledge hasn't been done before for the obvious reason that (orthodox) history is written by the winner. So is it because he champions those that do not have a voice in rich white male society that he is a "leftist" or is it because of his politics? Kind of like what came first, the chicken or the egg? You can't champion the cause of the oppressed without being "leftist"? To consider "everything" I have learned as suspect is a tall order. I would be interested to know some of what you found in error in Zinn's book.

In Cuba, there are the poor people, and there is the government class.

I thought you said class structure analysis was leftist?

Public housing causes crime because when no one owns something, there is no incentive to take care of it. It has nothing to do with the class, it has to do with this fact of human behavior.

So you are saying that rich people and middle class people would run riot in a public housing complex? That is a non sequitur. Do you acknowledge that the users of public housing are poor? Poor people by definition are unlikely to own anything, because they cannot afford it. So if you take away public housing, they will go be poor somewhere else, but the conditions of poverty and inequality will still cause crime wherever they land. But I can agree on one thing with you, they don't need to be concentrated in public housing (just makes them easier to police), they need jobs that pay a living wage.

Removing the profit motive would be a disaster. I can say that you need to keep thinking until you realize that.

If you could explain to me how an ideology can safely violate the second law of thermodynamics by insisting on infinite, exponential growth, then profits (an integral part of capitalism) can stay. If not, you are going to have to find another way. Or nature will find it for you.

You have a long way to go, and that is because you’ve read a bunch of stuff that has told you lies and corrupted your mind.

Not to say I am without my biases, but I weigh everything I read critically. You may be aghast that I do not reach the same conclusion as you do about all of MF's ideas, but I am not a purist, I take what I like and I leave behind that which I think is not workable. Now and from the outset I have acknowledged that it is perfectly possible that I could be wrong and in fact I have discovered some limits to my knowledge in regards to the education system so that being said if you are going to tell me that what I've read is lies and corrupt, you are going to have to be more specific, and employ less hand-waving.

I think we have come to an natural end in our discussion as you've expressed some reservations as to what authors I have used to anchor my intellectual foundations, so it is fair to say that you are no longer open to being convinced or learning and this conversation has just become one way.

I would like to go on to thank for your time as throughout this debate it has deepened my understanding of libertarianism and where it fits in the liberalism framework.

Saturday, September 08, 2012

Free to Choose Rebuttal 2

Keith has graciously responded to my first rebuttal here. I'd like to again thank Keith for engaging in this exercise as it has forced me to improve my understanding of libertarians and it's relationship to objectivism. I've responded to him below. I can see his position that the government spending is getting out of control, but I think where he is coming from is that government is crowding out private delivery of the same services, whereas I am coming from the view that corporations are externalizing their costs onto the government.

Keith's truncated statements (truncated for brevity, visit his site for his full argument) are in italics.

Without further ado, let us proceed.

I can prove that libertarianism is much bigger than objectivism: Locke, Adam Smith, Bastiat, De Tocqueville, founding fathers, Edmond Burke, Von Mises, etc...

The founding fathers were not libertarians, they limited federal powers but left everything else to the state level, plus the Constitution provides for the establishing of post offices, granting patents, regulating commerce between the states and suspending the writ of habeus corpus . I'll still concede that libertarianism is bigger than objectivism, but I'll still contend that objectivism injects the worst ideas into libertarianism.  By adopting Rand as one of your own are you also taking ownership of her philosophy?

I believe Friedman deserves a... Freedom is about you, about the individual. You might not fight for freedom yourself, but respect others that do.

The best thing about individuals is what they can accomplish together.  Collectively. Yeah I said it. Collective action can be voluntary.

I like using the word liberty because it is a good name for what is important to me and because a lack of freedom is one of the biggest problems...

I feel the same malevolence has been leveled at the terms "collectivism", "collaboration", "communal".  Indigenous people have lived in a communal, collective fashion for thousands of years without devolving into a totalitarian state until an unfortunate encounter with Western civilization lead to their extermination and, in less violent circumstances, enslavement and indoctrination.

It should be noted that when trying to hook the population into entering “voluntarily” into the bloodshed of the both world wars, the words “liberty”, “freedom” and “democracy” were flying thick. All to persuade the masses to fight for imperial interests. The ruling elite with all the lip-service paid to democracy and freedom had no intention of creating a more just society(pg 30, Economics Unmasked by Philip B. Smith & Manfred Max-Neef). Do you think World War 2 was against evil? It essentially boiled down to some imperial powers not being comfortable with Germany controlling resources that they already controlled or wanted to control. The same corporations and bankers funded and supplied both sides of the war.

I would privatize social security, not kill it. That is the libertarian solution. I think about it in terms of policies and ideas.

Privatizing Social Security is certainly a libertarian solution as it links contributions to individuals and certainly fixes the free rider problem (if you are inclined to view it as a problem). But what is the solution for those that have insufficient contributions?  Private charity?

No one has perfect knowledge in a transaction. But in the free market, you have more knowledge, more choices, and ...

The free market and the calculations rendered by the "invisible hand" presupposes a perfect knowledge of the market, via information transmitted by prices.  To be clear, this is not my obsession with perfect knowledge, this is an assumed attribute of the free market (I believe you referred to it as a “symphony”).  What I am saying is this assumption is incorrect.  If you agree that the knowledge is not perfect, then perhaps the model is insufficient.  And I am in agreement that liberty, available for all, does lead to greater quality of life.  But does freedom include the freedom to exclude or to restrict?

Greed is a term that others put on libertarians. I prefer self-interest. This is an example of Hayek’s point...

Greed is a term that you used in your initial tweet to me (which you repeated here). This is a very objectivist position, and I find it indefensible. Greed is not a virtue. If you prefer rational self-interest (another objectivist term) can it be defined in a way as not to infer greed?  I personally do not want to demonize anyone, I want to like libertarians, so help me out. 

Do you think that the dream if becoming rich is a way for the plutocracy to get the poor and middle class to buy into the system?  Statistically speaking the poor and middle class will ever make up the majority, while the rich make up a select minority. 

Corporations existed in the time of Adam Smith, in cities at least. Corporations are people...

Corporations have existed since the 1500's but the were limited in scope and limited in time. It wasn't till 1819 that they were recognized to have the same rights as persons under law, and this was after Adam's time.  An unfortunate ruling this was because corporations are not people, nor do corporations have the same goals or motivations as natural persons.  Corporations are immortal (as long as they turn a profit) and the people that work for a corporation are interchangeable.  So equating people and corporations as similar entities is in error.   Calling corporations “voluntary associations” does not mitigate the twin facts that in this economy we all must work to eat (even more true in a libertarian sense) and the fundamental drive of any corporation, mandated by law, is a fiduciary duty to the shareholders (owners) to provide the maximum return.   If you really cherish liberty and responsibility, then you should be ok with having only partnerships and sole proprietorships as the business models for free enterprises. 

I agree that TNCs are threatening, but less so because the consumer is holding the credit card...People in Greece are rioting in the streets!

People are rioting in Greece because the government is impoverishing the people at the behest of bond holders.  Who makes up the bond holders?  Mostly banks, TNC's, hedge funds and other countries.  

Libertarians have a strong dialectic on the nature of force.  What is required for the transmission of force?  Power. What stands in for power in our society?  Money. What lends to the permanence of power? Laws. Who makes the laws? Govt. And if we are honest with ourselves many of those laws are heavily influenced (if not written) by TNC's.  So let us engage in a thought experiment and see what changes in the equation with a small govt.  How is power transmitted?  If your answer is money, then does it matter who makes the rules/laws?

People love to point out that corporations and individuals are bad...

You have acknowledged that corporations tend to co-opt the government apparatus for their own ends.  Much of the "dumb government policy" is written by TNC's. Do you really expect this behavior to change because one part of the equation has changed leaving intact the power and influence of TNC's?  This behavior is embedded in corporate structure and this doesn't go away when governments go away (or shrink).  So you don't need to look at them as a group, you only need to look at the fundamental framework that every corporation is built on.  This is a blind-spot in Milton's work and a blind-spot in libertarian thought.

You don’t know everything about a supply chain, but you can know something. We live in an information age...

Indeed we live in an information age where we are deluged by terabytes if we so desire. So then why can we not internalize costs and make our economic model complete?  Are we talking about the department stores available to the masses, or the “special stores” available to the politburo? I've already acknowledged that the soviet solution was woefully inadequate, but just because price information keeps our retail stores full, doesn't mean that it is taking a true account of the cost to our ecosystems to keep them full.   The neoliberal model, economic liberal model, classical liberal model and the Keynesian (Social Liberalism) model have a backwards view as to where the environment figures into the economy. 

I don’t worry about deregulation because I see the free market as a symphony and the government as screwing things up, as sand in the motor...

Capitalism has a tendency to slowly consume its own capital in its drive to increase bottom line profits so the system comes with its own “sand”.  This is an inevitable result of need for exponentially growing profits, growth has to hit hard limits. Deregulation in theory seems like a good idea, except that it leads to the concentration of power and influence (i.e. financial sector) so it appears that even in libertarian literature that some gov't intervention is necessary to guarantee competition, meaning that a pure free market (laissez faire) model is unbalanced, therefore incomplete.   As for competition, I agree competition is better (collaboration better still) than monopolies and cartels, but I historically speaking capitalism's tendencies have been towards both of the latter. 

Yes, the US was never a purely free market, but the reason it became a superpower is because it was the “land of opportunity”...

I would counter that the "American System" was successful enough to be copied and successful enough to threaten the Anglo-Franco hegemony to spark WWI.  I agree it was about freedom, but also freedom to lay down tariffs to squash foreign imports (see the earlier paragraph where I ask about freedom to exclude and restrict, is there some inconsistency in the application?)

Globalization doesn't benefit anyone but corporations access to raw materials and cheap labour. The counter argument that we get cheaper goods because of it, rings hollow when your factory job has been outsourced to a country where they can pay their labourers half of what you were earning and no benefits.  Of course you'll need all the cheap goods you can get to make your welfare cheque stretch further. 

We aren’t waiting to address the poor. That is what vouchers, and a negative income tax, etc. are all about...

I'm all for effective spending and cutting waste. You want to get people working again, you are going to have to realize that corporate supported globalization strategies are not helping your cause. It is my view that privatized insurance and health care tend to want to take care of people who can pay and the rest get sub-standard service or none at all.  I have experience with public health care and had a few surgeries that would have wiped my family out had I had to pay for it.  My care was excellent and I am better for having it, money was never a question.  So I believe in universal health care, and I believe it is the hallmark of any great society. 

It sucks to live for the government. I knew someone in Denmark who wanted to take some of his retirement savings and buy a boat... In the private sector, you’d go to jail for this.

And yet this is what will have to happen for any serious drive to privatize SS.  You will have to slash the benefits.  And as for people going to jail for fraud in the private sector, after the last rounds of shenanigans with LIBOR (and every financial scandal leading up to that back from 2008) I am losing faith that anyone will go to jail from the too big too fails. Is this the kind of accountability we are to expect from the private sector? I know you response will be along the lines of “the government is not doing its job”, but how would you call these entities to heel without strong government? Where are the people with their credit cards, extracting the justice that has been denied?

I believe we require industrial civilization. I agree that Friedman assumes this and I do too. You talk about Hayek taking us backwards, but it turns out you want to...

Prince Claus of the Netherlands once said:

"Indeed, I believe that mainstream economics represents in many respects an orthodox consensus which can be shown to be deeply conservative. Such orthodoxy nearly always tells us we need more of the same that got us into the problem, to get us out of it again. It seldom tells us we need something new. Something new."

This seems to be a pretty common presupposition.  If “x” goes wrong, we need more “x”.  For example, deregulation of the financial sector was a pretty terrible idea so the calls were for even more deregulation.  The Federal Reserve made the situation worse by not exercising it's power of oversight, so the response?  Give the Fed more power.  How can we make industrial civilization better?  The answer is...more industrial civilization!   Other than the fact that industrial civilization is unsustainable and is killing our land base, it seems to be a good idea.

You can love what big corporations deliver (as I secretly do) but that doesn’t change the fact that the production and delivery is unsustainable.  You want to go forwards?  Then take the next step beyond industrial civilization, hint: it won't look like big cities and bright lights, 8 lane highways and mega airports. 

With regard to your clear-cut analogy. Private corporations talk about sustainable forestry, and have for decades... The idea of companies dumping toxic waste are long gone.

So I wonder when that talk will turn into action?  Or perhaps they need some more time to talk?  Perhaps another couple of decades?  Private ownership of land is not a panacea,  it gives license to dispose of ones property the way they see fit to do so, and if that means to clear cut the land for a higher ROI, then that is what will happen.  The only time that private ownership protects land is when it is bought by an entity that has that has the primary motivation to protect the land from exploitation. Of course who among us has the luxury of purchasing land that will not be used "productively".  These are systemic effects of the drive for profit using an economic system that does not calculate real costs. 

As for companies no longer illegally dumping a quick google search turns up some easy and recent examples.  As long as the fines for getting caught are less that the ongoing cost of paying for legitimate disposal, dumping will continue.   The interesting thing is this is corporations operating in flagrant violation of government, so either they do not fear the monopoly of force, or they know that the monopoly of force is there to protect their interest and not the people (or land). 

The military waste isn’t as much as you think. The US can afford a military, it is about 3% of GDP which is typical. We do live in a dangerous world — been to Syria or Somalia recently...

I'm glad you worry more about failing education than the military might of two nations that have never posed a direct threat to the US.   How about peace through generosity and helping?  Nothing says that the US cannot arm every citizen (who would invade a country where every man, woman and child had access to firearms?) with an emphasis on leadership and conduct a foreign policy that has the world looking at the US as a friend and not a soldier.  You want democracy and freedom to spread, live the example and stop exporting it at the end of a gun barrel.

Examining the social spending I would agree that it seems to be getting away from your government (military spending outstrips SS by itself, but just barely). The question to ask is why does a program, that was initially supposed to be a supplement to private pensions and savings, now count as the primary retirement savings for over 70% of Americans?  I suspect that you would answer that the government crowded out legitimate private competition over time, but could it be that SS was filling in a gap that was left when private pensions and savings began to dry up?  Why would a corporation bother setting up a pension for staff when it can externalize those costs onto government?  Private pensions and privatizing SS will only work if it can be made profitable to someone, and the profit is likely to come at someone else's expense. 

You apparently don’t know that there are many kids in cities (not rich suburbs) where the costs are $24K per year yet people still fail. It isn’t a matter of budget cuts, there haven’t really been any...

I wonder how it is that they could spend up to 24K per child and not be able to afford basic school supplies?  Reference?  No budget cuts? Reference?

How about go one step further. Get rid of schools altogether. But keep libraries and the Internet free for all.  Establish a rudimentary course for basic reading, writing and arithmetic, after that let those who want to learn more teach themselves or organize into peer groups that pursue specific interests. 

Private schools are not better because of the money. It is for other reasons. They have many...

Private schools are in part better because of their exclusionary nature. Teachers have to teach to a narrower range of student ability than they do in public schools.  Of course I still think that public educations inability to afford basic supplies because of budget cuts must hamper their ability to effectively educate, what say you?  So I say instead of forcing education on kids and a static curriculum, allow them to learn what they want when they want it. 

The root incentive for corruption comes from big government. The best way to minimize corruption is to minimize government which maximizes competition...

I would disagree, the root incentive for corruption is having an economic system that is divorced from morals and ethics. If an activity makes money, society does it, if an activity doesn't make money, it will not appear in a free market(or any market), it cannot. It has to be external to the free market.   The rest of your paragraph I've addressed earlier. 

I don’t know of the Jan Wong story and I’m not interested in anecdotes. I can say that NHS is worse...Obama doesn’t even talk about that problem, the Republicans understand it and think about it.

Friedman was full of anecdotes, but he has some interesting things to say.  I'm not familiar with the workings of NHS so I'll have to take your word for it. I am familiar with the workings of socialized medicine in Canada and I have few complaints.  Healthcare in the US is exemplary, for those who can pay or for those with the right insurance.  As for Republican thought, the same thought brought us trickle down economics, financial sector deregulation, No Child Left Behind, among others. Of course, nobody is perfect.  I really doubt that any answer lay with these two parties.  If you read Carroll Quigley's Tragedy and Hope you'll understand why   (you don't have to read the whole thing, just the first 200 pages of the book). 

Friedman doesn’t have any moral blindspot. He has provided a safety net. The family is another one, so are churches, so is a negative income tax, so are vouchers, etc....

Most of Friedman's solutions seems to be external to the free market.  I wonder why that is?  Privatization comes from the root Latin word privare (literally, to rob).  To privatize means to deprive use of, which is the fundamental power of private property laws, it is not that you can do what you want with the land, it is that you can prevent others from having access to the land.  You, like other libertarians, think that private property laws are there to protect you, but they are there to protect the plutocracy. Their ability to buy up and deprive others of the best land is disproportionately large and they will continue to do so, protected by the private property laws that libertarians insist everyone respect.  This, I think, is why the libertarian position is the least threatening to the wealthy, you seek small weak government and strong property laws, which seems like a good deal for the rich. 

Although governments are perfectly able (and sometimes willing) to destroy families, what commonly destroys families is the imposition to earn or starve. This is not a new phenomenon, aristocrats have ever forced the plebeians into a position of work or starve.  And by work I mean labouring not for yourself or for the benefit of your family but primarily for the benefit of the landowner you are forced to work for after being dispossessed of your lands held in common (see the great enclosure of Britain centuries past, that was an excellent example of privatization at work).  You can read about what the British experience was like in The Great Transformation by Karl Polanyi, or the American labour experience by reading Howard Zinn's A People's History of the United States.   So if you still think that it is governments and collectivist action that destroys families we can talk again as to why you still think that. 

Crime is not primarily because of inequality... Public housing projects cause crime much more than inequality.

Does Cuba's massive inequality outrank the US?  I find the claim dubious as I do not recall Cuba ranking high in the book The Spirit Level by Richard Wilkinson. Looking at Cuba’s Gini coefficient (which is an accepted measure of income inequality) it used to be at .24 and then rose to .38 after the collapse of the Soviet Union. The US ranks at .45 according to the CIA World Fact Book. So while Cuba’s inequality has risen due to external circumstances it is not as high as the wealthiest nation on Earth. Seems to me like there is already much in the way of rational self-interest going on in the US.  Let's look at you definition of what qualifies as a crook, getting the necessities of life from the black market from a common sense perspective does not make one a crook, it may be illegal, but it isn’t immoral or unethical.

I feel you are making a couple of assumptions with your references to the USSR, the USSR does not represent my position.  I, in fact, agree with most of your assessments of the USSR. Where I disagree is that it was not communism in any Marxist sense, it was barely socialism. It was state capitalism.  Substitute the 1% with the politburo and substitute the profit motive with the production quota and you have a good mirror image of the growth economy of the US and of the USSR. To be clear, if you want to refute my position, you would be refuting ecological economics and a steady state economy.   

Your assertion that public housing projects is a greater cause of crime than inequality is an odd one. Let us examine it in greater detail. Who uses public housing?  It would be the poor.   Transplant all the poor out and put in middle class people and what would happen to crime?  As long as they still had their net worth they'd be fine. Take it one step further, replace the poor with the rich, crime almost disappears.  So it's not the place, it is level of wealth disparity. 

This is much more than just cutting the military. That is really the only specific proposal you can suggest after all this reading and writing?

From what I can see the US spends about 6$ on social spending (pretending that all the rest of the spending is social spending) for every 1$ on military spending. Is there waste and program overlap? Certainly. But I would rather spend twice as much helping people and the land base than spend 1 cent on killing people

As for what I could suggest, I have many suggestions, first would be to fix the economic model to include all costs, next would be to shift from a growth paradigm to a steady state removing the profit motive and debt based money, next would be to re-examine US foreign policy and stop the imperialist expansion, next would be to create jobs that help the land base, where there are more trees than the year before, more salmon swimming in the rivers than the year before, more biodiversity than the year before. This is true profit, this is true wealth, not pieces of paper, pieces of debt

Tuesday, September 04, 2012

Free To Choose Rebuttal

"I read the following review of Free To Choose by Vasper85 and wrote down the things I disagreed with."

I would like to thank Keith for taking the time to read and respond, as twitter debates are exceedingly restrictive.

"I wrote this as I read your review. I didn’t even actually read it all through first..."

Your sentiment reflects mine exactly as I was reading through Milton's work. I did persevere and finish it. And I salute you that you did also.

"I tell you to read Free To Choose because the ideas are so complicated it takes a book..."

I agree that some ideas are too complicated for twitter and no one is faulting you for telling me to read a book. For most that would be the end of the argument, for us it establishes a common ground to continue the conversation.

I'm sure objectivists would disagree with that assessment as Ayn Rand's distaste for libertarians was well known. But to an outside observer the similarities are striking which bother me to some degree.

"You make a mistake in calling Milton Friedman an “opponent.” He is one of the greatest men of the 20th century..."

I'm not keen on putting people on pedestals. Last I checked, MF was a man and therefore fallible like the rest of us. And some history, I discovered libertarianism through Ron Paul, like I suspect many of us did. I liked what he had to say, so I didn't arrive at my current view lightly. It took much reading and thinking.

I'm also wary of flag waving words like "liberty" and "freedom". Hayek himself writes about the subtle twists of semantics that socialists apply to such words to make them mean not what one would think. This is a common trap so I generally ignore arguments that involve me being for or against such nebulous and ill-defined concepts. If you'd like to define what you mean by liberty and then perhaps we could compare it to Milton's definition.

"You say that greed is not a good way to run affairs. You are incorrect for two reasons:
1. The free market can’t judge greed, nor any other motivation. Who even knows what are all the motivations someone has to buy or sell a pencil or make the chainsaw? The government surely can’t measure emotions, only dollars. If you care about greed, become a priest, not a politician."

1a. I agree, the market can't judge motivation especially when it is so large and far flung. The players do not know each other. So one couldn't really know if the market (or the goods derived) are "free" either (by free I mean voluntary). So the question becomes, how can I truly enter into any transaction voluntarily if I do not possess the information necessary to make a decision? To put it another way, if there was some aspect of production that I, if I knew about it, would affect my buying decision? If this information was suppressed by price, how is it still voluntary?

"2. The point is to have government let people keep the fruits of their labor. Self-interest unleashes maximum potential in people."

2a. To the first point, I can agree with that in so much as long as government treats all classes proportionately. To the second point typically the term "self-interest" is used synonymously with "greed" and "selfishness", perhaps a more enlightened view would be mastery, autonomy, purpose. Is it necessary to defend greed as a virtue to be a libertarian/objectivist?

"Page 2. I am sure Adam Smith knew of corporations, cartels and monopolies. His focus was on monopolies in government, but it is the same phenomenon as with corporations."

2a. Corporate structure (corporations as people) didn't exist in his time, but I'll concede the others. Interesting that you acknowledge that monopolies of government are essentially the same problem as monopolies of commerce.

"I am finding disagreements with nearly every sentence. I’m not going to respond to every one."

Nor would I expect you to. It took much work and time for me to put this together. There are specific things I want out of the ideology of libertarianism and it doesn't need or warrant a point by point redressing of my critique of Milton's work. Predominately what I want is a recognition that TNC's are just as dangerous to liberty (ones ability to conduct ones activities in a way that is not in conflict with his community values, freely) as governments are. And that we have a responsibility, both individual and communally. Whether you want to express that responsibility as directly helping your fellow man out when they fall on bad times or through taxes and a third party is mostly irrelevant, but to know that such a responsibility is not optional. That morality is not egoistic, but rather altruistic. Lastly I want an acknowledgement that there is a limit to economic growth.

"TNC are not equally as tyrannical as governments. Corporations get their money from people voluntarily..."

That goes back to how you can transact voluntarily with an entity you do not know and whose supply chain you cannot discern. There is a fundamental information asymmetry that exists that is not overcome through price alone. And as for choice, as I said in the previous post, if the industry standard is larceny and fraud, no choice exists. To put it another way, realistically we have little option but to transact with the current system and the choices they offer us.

And it leads to another question about force. If you force the government to relinquish the monopoly it has over force what is to prevent TNC's from picking up that monopoly directly? Libertarians, I get the sense, mostly feel that everyone will abide by the NAP. How do you enforce NAP? I feel that NAP is fully for the benefit of those that hold the power. I've also heard about hiring private security to enforce property rights, but it seems to me that it circles back to those with the money make the rules. Does NAP reconcile with hiring private security?

"Hayek would not have you go backwards. It was the free market that made America the world’s only superpower. With more freedom, harnessing everyone’s potential, comes faster progress."

The "American System" included quite heavy use of tariffs to protect infant industries. In fact it was Germany's adoption of the American System that lead to the upset of the Balance of Powers strategy employed by Britain and France that lead to WWI. And after both WWI and WW2 America was the only major intact economy, so held a de facto monopoly on manufactured goods.

Let's pretend that doesn't matter.

I would ask for what end? Faster progress meaning more profits? At what point do you as a society deem it acceptable to address the fundamental inequalities that exist with this progress? Both Hayek and Milton recognize that these inequalities are inevitable in a free market but neither have a solution other than a vague assertion that we'll all tend to get richer over time. And we can all see who gets richer and who gets ground under the jackboot.

Is it in fact impossible to harness everyone's potential and reduce inequality?

Also does the libertarian ideology have any room to acknowledge a limit to economic growth?

"Page 10. Friedman’s analogy about the Soviet appliance you didn’t understand...."

Perhaps I don't understand what happened in the USSR, that is certainly possible. I think that it is succinct to say that the Soviets lacked a good feedback mechanism (demand), they employed people to observe what people were buying/wearing and tried to gauge demand from that. And with the production quota, they were progressively using more material to construct products which in essence was attempting to emulate the economic growth represented by profit in a capitalistic system. This is my view was a mistake, as state capitalism without a price system will eventually fail quite spectacularly, this fact is well documented (re: economic calculation). What the soviet model was attempting to do was out-produce and out-grow the capitalist model (out-capitalize the capitalists) and it was doomed to fail because of allocation problems.

"Page 11. No one can make a pencil. The person who makes the chainsaw doesn’t also know how to harvest the rubber..."

MF's analogy presupposes we need an industrial supply chain, which presupposes we need industrial civilization. These are unexamined givens in his analogy that we are to accept if we are to accept his premise. By adding and emphasizing the word "industrially" I was pointing out MF's premise and I do not accept that we require an industrial supply chain nor industrial civilization.

"Page 14. The consumer knows more than price. The competitors can buy each others products and learn from each..."

Pg 14a That consumers (i.e. people) can know more than price if one possesses the materials, time and inclination to do so I am in complete agreement with. Being that consumers are price takers and live in an economic system where taking the best price confers a clear short term advantage, it is difficult, in the aggregate, to act in a manner that is advantageous to the environment and at the same time fulfill ones rational self-interest.

For example, given that for a stretch of forest, to clear-cut it would give a total ROI of 15% for 10 years and to selectively harvest and replant would give an ROI of 10% over the same period and there is no repercussions (legally speaking) between either scenario in the treatment of the privately owned land, it behooves the CEO to choose the plan with the highest ROI given the time horizon and his fiduciary duty to his shareholders. After which his options are vested and he can cash out.

From the production point of view, the cost to produce products from the timber when one does not have to internalize environmental costs is advantageous for the company and for the consumer in the short term. By the time it becomes apparent that this externalization of costs is leading to price distortion it is too late for that stretch of forest.

"Skipping a number of things I disagree with about advertising, Opec, military, whether he’s..."

I think that the military question should not be avoided. In other libertarian literature I have read they make the argument that any military should consist of free men, to be gathered for defense only, yet throughout the book I never saw Milton make that argument once. I wonder why he would spend so much time attacking the apparent life support of the poor and so little time attacking the overwhelming waste of the military?

"Okay I’ve now gone through and read the rest. I can say that you have a mix of missing the point, or sometimes arguing against a point he wasn’t making..."

If I was in fact arguing against straw men, I do apologize, I do make the effort to try not to fall into that trap. I did realize upon looking back I made an egregious accusation that MF regarded poverty as a moral failing and that coloured my arguments. This is not a libertarian position, but rather an objectivist position. I've retracted that in my original post.

MF primarily rails against government and unions and is pro-business in all of its forms. To be clear he makes no distinction between a market environment in which it is possible to know the actors and a global environment where business entities are artificial legal constructs with the same rights as people and it is nigh impossible to know actions behind their activities. This is problematic for me that MF does not apply his arguments equally between these entities and essentially gives these power-concentrating entities a pass. Again in other libertarian literature, they do address corporations, saying at the very least to remove the limited liability shielding protecting the shareholders.

"For example, having read through his book, can you not see how Social Security is a bad idea? Can you not see how vouchers for education for every child would be better? Can’t you see how big government leads to takeover by industry and corruption..."

Social security: I don't see it as an either/or proposition. Since community ties have essentially been eroded, some means must be available to look after our most vulnerable members of society. Is Social Security the most ideal? That is beside the point. They need to be taken care of and I feel that ripping away the safety net is not conducive to helping the poor and vulnerable escape destitution.

Vouchers for education would drive up the cost for the desirable schools putting them out of reach of the middle class and poor. The rich would no longer subsidize any education of the lower classes. So call a spade, a spade. If the rich don't want to pay for other peoples children, be honest about it, but let's not pretend that it is because this will better the education system. I don't deny there is a failing in free government schools but I am realistic enough to attribute some of the failing to deliberate cuts in education folksy fund increases in military spending and cuts in income taxes for the richest individuals and corporations. Does it not becomes a self-fulfilling prophecy when you announce that education is failing the children, then cut the funding, then announce that education is failing the children more, then cut the funding some on and so forth. Why are private schools looking so good in comparison? Because they have money and those that can afford to pay expect no less.

Government is as good as the people who govern. Incentive for corruption stems from the private sector, transnational corporations. TNC's use govt as a tool to protect their business interests often by writing the legislation that gets passed. There is no accountability, politicians get in, serve a few terms, preside over favorable legislation, then exit to some cushy board of directors job. Which illustrates that you cannot be anti-govt without also being anti-corp. They are two-sides of the same coin. An interesting exercise would be to comb the media and see on which side the government acts against when it comes to protests and strikes. Invariably it is on the side of business.

Another glaring example of the power that corporations hold over individuals is best illustrated by journalists Jan Wong's battle against Globe and Mail and Manulife. She was suffering from depression (clinically diagnosed) and both entities basically called her a liar and cut off her sick pay on a number of occasions. When she wrote a book about workplace depression years later Globe & Mail killed the deal with the publisher Double Day with a phone call to DD's lawyers (which also happened to be Jan Wong's lawyers as she paid for half of the costs). This was after the book was done and ready to go to copy writing. This is a chilling display of effects of corporations on free speech and the "free" market.

First 30 minutes, click on the "listen" button. This is but one of numerous examples of abuses of corporate power and the scary thing is no one would of heard of any of this had Jan Wong not stuck to her guns and refused to sign "confidentiality" agreements. Most people would have, with the money that was on the line (DD tried to tie in her compensation with the agreement). Most people do not have the luxury to fight.

Orphans: Perhaps that was unfair of me, but in the context of MF's examples he states that morality stops at the individual and that family should be cared for by those with familial bonds. The obvious blind-spot is those without family. That private religious charities should step into the gap puts one at the mercy of a religious institution and whomever funds the private charity. Say what you will about government charity it at least has the veneer of impartiality.

Crime: It is primarily because of inequality, so in defending a system that admits that they would rather have "freedom and inequality" than "equality and slavery" (as quoted from MF's work and another false dichotomy) it illustrates a conflict of interest.

"You ask many good questions, but I assure you they have answers. You seem to have read a lot. I can only suggest that you keep reading and thinking."

It is my intention to continue to do so.

"Your major focus is on income inequality, and we can argue more about that, but let’s look at the existing welfare state as a total disaster and repeal 90% of it. If a country goes bankrupt “helping the poor”, then it can no longer help the poor nor do anything else."

If by repealing 90% of it includes repealing military spending perhaps that is a compromise I'd be willing to entertain and I believe that there are libertarian writings that support this view. But let it not be said that social programs are what is bankrupting the US. It is military spending (non-productive in the truest sense) and disproportional tax cuts for those that need it least.

Sunday, September 02, 2012

Road to Serfdom

What follows are my notes/thoughts on Frederich Hayek's work "The Road to Serfdom". As I review libertarian/objectivist literature I find more and more what I object to is the binary thinking i.e. it is either this or that, no other options.

Pg 72 Hayek makes the argument that the advancement came because of the freedom to pursue profits, basically to allow great inequality allowed for faster advancement, the fruits accumulating first to those that took the risks then to common society at large. Trickle down economics? And because of this wealth of advancement we inevitably reject the inequality. FH thinks this is wrong, I think this is society growing up. We don’t expect toddlers to progress to adolescents only to lapse back to being toddlers when they become teenagers.

Pg 76 Libertarian/objectivist thought bandy about the word “freedom” quite a bit, but what of the second half, what of “responsibility”? Parents allow children greater and greater freedoms only because the demonstrate they can handle them responsibility. With great freedom comes great responsibility

Pg 77 Individualism has been associated with egotism and selfishness, but what also of separateness? Man's separateness from nature, Man's separateness from his fellow man (of a different class)?

Pg 77 Hayek confuses the "despotism of physical wants" by looking at it in capitalistic terms. He thinks it means power and affluence, but what it really means is sufficiency and knowing when it is enough.

Pg 78 there needs to be no great increase in material wealth to have abundance, it merely requires a shift in thinking, from a progressive growth paradigm to a steady state economy.

Pg 85 FH says the dispute is not about whether we want to choose the best way of intelligently planning or not, but rather what is the best method to do so.

Pg 90 FH effectively polarizes the argument by saying that planned economies and decentralized economies are wholly incompatible, thus creating a double bind by eliminating any third option (as there is no other option but socialism and capitalism).

Pg 99 FH makes the argument that their is nothing that planning can do that the free market couldn't do better and more efficiently. I’ve addressed the efficiency argument in my review of Milton Friedman’s work. Free market capitalism holds the distinction of being efficient when it comes to liquidating mal-investments, this I will concede.

Pg 102, To be fair, if you look at the aggregate of what people want, and take out manipulated wants, it isn't all that varied, nor is it infinite.

Pg 127 The monopoly directed at the economic system, if that is what it turns out to be, is made up of and ultimately answerable to people. This monopoly that Hayek speaks of is no different than the TNC cartels that currently run things.

Pg 128 Discrimination is quite handily enacted by money today. The only difference is you can't call on money to account for its discrimination. A person would be accountable. The act of “which by taking one, we deprive the other members of society", is this not force , however thinly disguised and indirect? There is no quantifiable difference between the monetary system pricing something out of your reach or some person telling you that this particular use of resources is not advisable. It is only offensive to libertarians sense of individuality and freedom to choose because it is a person or group of people (community) that stands in their way and not the divine “invisible hand”. This is a problem that has extended way back into history, we cannot tolerate being advised against something that runs contrary to our interests by those we perceive as a our equals, so our leaders and experts have to have that something special that sets them a head and shoulders above the rest of us. It used to be the divine right of kings, then it was knowledge and learning, today we settle on wealth.

Hayek tries to slide the premise by use that socialism must be centralized and centralization must be done along dictatorial lines. There is no attempt to entertain that socialism could be decentralized with decision making power delegated out to the local level where those on the ground have the most knowledge of the region. Similar to hunter/gatherers, it was knowledge of the land that was valuable in the use of it, not the ownership.

Hayek spells out the deviousness of the gilded cage, as long as we have the hope of escape we can tolerate the intolerable, and he is referring to the competitive system. Religion had a similar tool to get the masses to accept their role, it was called the afterlife, live a virtuous, uncomplaining life and when you die you will go to your reward. That is the road to serfdom. Why else does the media focus on the rags to riches stories? Why else do we have lotteries? We else to we deify the rich and famous? To fritter away our energies in the hope, the faintest of hopes, that one day we can be like them. This is enough for us to submit and allow the continued exploitation of our labour for the benefit of the upper class.

Pg 129 Society expects you to make a contribution. Currently we spur that on by making it a requirement to earn money to eat. But this is no different than a more transparent process proposed by socialists. By your works shall ye be judged. There is little freedom of choice in today's occupations, you are limited by your level of education, your physical and cognitive talents and by who you know.

Pg 132 What if, instead, we substituted the term "collaboration" for "central planning". That certainly has a more voluntary ring to it.

Pg 135 Wow what planet is Hayek talking about? Of course there are means and ways to prevent a poor man from rising above his class. These are embedded in the matrix of society. It isn't to the upper classes advantage if there is no semblance of permanence of wealth, so the desire for restriction of who can become wealthy is great. So no nothing to prevent the "attempt", but lots to prevent the “success”. Hayek tries to slip another premise by you that if property isn't to be privately owned it must then be state owned, does not consider it can be commonly owned or that it needs to be (or can be) owned at all.

Pg 138 Not necessarily, you'll do what you want to do and if you are good at it, you'll continue, if you aren't good at it you'll most likely bow out because of the embarrassment in front of your peers. For example, you want to be a dancer, and quite frankly you have two left feet, it takes a pretty thick skin to continue to dance when your peers are clearly better and no one wants to watch you.

Pg 142 FH says education can create no new ethics nor create a common vision held by all, especially on moral issues. Education can grant perspective and more options in which to express oneself, more tools in the tool box. To restrict education would result in a world much similar to 1984, where words were routinely removed from the dictionary and history continually rewritten in simpler vocabulary, the idea being that if one does not have the word to express a seditious concept then one cannot think seditious thoughts. Indoctrination, to work, has to be simple and easy to digest, and is more successful upon injection into simple minds than critical minds.

Pg 143 FH makes it appear that socialism started out like a cult. But spontaneous social action arises in response to imposition of free markets as per Karl Polanyi.

Pg 151 Why is FH making his arguments like there is wages to be paid in centrally planned socialist society, why bother with wages when it is goods that people need? And he is saying that the only alternative to discipline by firing is discipline by corporal punishment? False dichotomy argument.

Pg 153 I get the feeling that FH talks in terms of incomes and wages because he does not know how to talk in any other terms. A common refrain I hear from advocates of the price system is that there is no alternative but considering we got along quite well without it for most of our time as a species, albeit on a smaller more intimate scale, says there are alternatives and the price system for all of it flaws, is not the final end product. For which we should be relieved.

Pg 156 You should do your duty in the field of your usefulness, these are not mutually exclusive. Also FH admits that some security must exists to preserve freedom, he frames this as security against privation, but as history shows us that it is security of one class against the others. Privation only enters into the equation when society is on the verge of revolution in which the plutocracy is forced to concede some of its wealth (arguably ill-gotten) to placate the masses.

I guess this is a problem will a system of thought that only allows for purity of ideology. It tends to make you perceive things in terms of absolutes. FH makes all the same accusations of socialism that could equally apply to free market because it is the inevitable conclusion if one were to stick to pure ideals. He does admit that socialism proceeds from the base of "for the good of the whole" which of course depends on what is define as good and for which "whole". But in keeping with the duality FH then would expect "for the good of the individual" to radiate out and automatically be good for the whole. This is a non sequitur.

Pg 169 FH launches into a lengthy diatribe entailing the freedoms you have to give up and the morals you must be prepared to break because in a collectivist society you can hold no ideals that are different from the collective. This implies that in an individualist society you can, and you can defend those ideals from the community. So what if the ideals you choose to hold and defend are anti-life? Ran Prieur says that any society in the face of having their neighbour arming up only has three choices, to run, to submit, to arm up and fight. So when an individual picks an aggressive ideal to drive their actions, like objectivism, they are arming up to take from their neighbors for themselves by way of wealth accumulation, redistribution as sure as it came from the top.

Pg 178 Seems like that would be the wrong question to ask, do I serve my ideology that purportedly serves the collective, or do I serve my fellow man which by definition serves the collective. Servitude through ideology is similar to the way they routed the understanding of the bible through Latin-speaking priests, for the reasons of control and to sustain power. When you take out the middleman (ideology or religion) and seek to serve directly, it cannot be corrupted or perverted by outside forces.

Pg 179 FH says an interesting thing that it is probably true that a great majority rarely think for themselves and seek that which is ready-made, which explains the droves that seize upon his works or similar individualistic works like Ayn Rand.

Pg 184 Socialism is the crude application of scientific ideals to the problems of society. Sounds familiar, where have I heard this before?

Pg 195 I read this and find myself partially agreeing, individualism and the environment are going to have to find a compromise with individuals sacrificing much. Efficiency is needed combined with no growth and decreased consumption. If libertarians do not understand this intuitively then they are in for a painful surprise.

Pg 200 I agree with FH's view on war that it is senseless and devoid of purpose (other than to steal resources of course).

Pg 203 Socialists of the day talked about "potential plenty" and talked about the inevitable slide into monopoly. The "best authorities" used to support the political tracts are of questionable scientific standing, while serious study into the same problems are conspicuously neglected as per Dr. C.H. Waddington in The Scientific Attitude.

Do we not get the same baseless generalities when talking about the miracles of the “invisible hand” and how the free market is going to “lift all boats”?

Pg 216 You don't build wealth out of thin air, it comes at the expense of something, such as the environment. Also not all wealth building is equal although it is regarded as such as both increases in GDP and money do not take into account what was the cause of the increase for example, military spending.

Pg 217 Independence, self-reliance, willingness to back ones convictions against a superior, willingness to bear risks, willingness to voluntarily co-operate with ones neighbors. These are the supposed hallmarks of a individualistic society. FH says socialism is nothing but obedience and compulsion to do what society has deemed good. I would say that for any good socialist society to function you would need a healthy dose of voluntary co-operation, and among equals you do not have to back your convictions against a superior, but rather a peer, your willingness to bear a risk in so much as it does not exceed your communities willingness to bear risk. Collaboration and creativity substitute for rugged independence and self-reliance. No one is an island on their own.

Pg 231 FH makes an interesting comment that we have not yet learned how to use state powers intelligently on a national scale. Does that imply the possibility that such powers could be used if used intelligently? He suggests that there must be a set of rules that lays out what a state can and cannot do and an authority to enforce such rules. As well he suggests that states should prevent other states from harming their neighbors which seems to run counter to the free market, rugged individualism he espouses.

Free to Choose - If You're Rich

My encounters with libertarians and objectivists lately boil down to "You have to read so and so's book and then you'll understand", with the implication that until I read it I cannot comment on the ideology/philosophy and they do not have to discuss it with me. A clever way to end an argument, but also fair enough, one should read the texts of your opponent. What they don't count on is that I'll actually read it AND detail out a critique on the book. I read fast and I read often.

I'll say straight away that I do not disagree with the entire libertarian position, but I disagree with enough of it (basically anyone who tells me that greed is a perfectly acceptable way to run their affairs. NEWS FLASH: it isn't). The following is notes I made on Milton's writings and the page numbers where he expressed the ideas that triggered my comments.

One complaint about the way I have laid this out is that it may not be all that intuitive to those that do not have the book handy what I am commenting on. To which I would reply that a) I do make some effort to frame Milton's thoughts that I am responding to in my critique and b) this is for people that either have read the work or have a copy and c) this also is my way of saying I have read the work and done the work, so fully regurgitating Milton's work is not necessary nor is it desirable (as this is bloody long enough already).


Pg. 2 Refers to Adam Smith, no force no coercion. Adam had no idea about corporations, monopolies or cartels. For example, Section 34 of Rogers TOS, states that they have the right to charge a customer for 30 days of service or when service is cut off, whichever is later, which means by default you are paying for 30 days of service which you will not receive. If it is larceny is the industry standard you have no choice but to submit to which is thus an unequal bargain.

Pg 2 Thomas Jefferson "We hold that...". Jefferson was a rich white slave owner. Rights in his view were qualified. Economic rights are still qualified.

Pg 3 Economic and political power in the same hands is a recipe for tyranny. He is referring to centralize government but his argument equally applies to Transnational Corporations (TNC).

Pg 4 It is ironic that Milton (MF) on the one hand preaches for a small weak government but on the other hand blames the government for weak policy that lead to the Depression. For a man that places such emphasis of personal responsibility and individuality to blame the government for people taking advantage of lax monetary policy is somewhat ludicrous. I'm not absolving the governments role, but blame must be properly apportioned.

Pg 4 Hayek’s argument that the early success of political and economic freedom lead to the increasing intolerance of perceived evils of inequality and taking advances and prosperity for granted. That is one way of looking at it, the other way of looking at it is our species is maturing, attempting to find the meaning of the word “enough”. Hayek would have us go backwards.

Chapter 1: The Power of the Market

Pg 10 Irony: Milton uses example of a soviet appliance breaking down and how long one would have to wait to get it fixed, this is no different than planned obsolescence in capitalism. Soviet system was better defined as state capitalism than communism. Instead of profit it had production quota’s.

Soviet model not efficient: based on what metric? The West's? From a profit perspective the soviet model was not efficient. Soviet was a growth economy like capitalism, it needed better feedback mechanisms and would have made a better steady state economy.

Pg 11 Correction: not a single person can make an industrially produced pencil. It has more to do with access to capital than actual know how.

Pg 13 Prices disconnect ourselves from the product and its production. Milton says it himself when he says we have no way of knowing where the product comes from. This is necessary in an economy where the players do not know each other which is the environment of TNC and this allows for the players to get away with all sorts of shenanigans to make a profit. If all the end consumer knows is price, the actions taken to deliver that price become irrelevant in the decision.

Pg 14 Prices: transmit information, they chose the least costly production method, they distribute the product (via income). Demand has no way of knowing it's impact on the environment as prices will be reasonable along most of the depletion curve.

Pg 15 Then what is advertising if not clogging the “in” baskets? Advertisers have no way of knowing if someone is in position of acting on the information or not as they spam the ether with their message. Price might be a simple means of transmitting the information because of what it transmits is so narrow to the end user, but the information that makes up how the price is arrived at is lost in the act of translating it into dollars and cents.

17 comments on OPEC but says that government interference is more important in price distortions than private. What about private interference in government?

18 Makes the case that all price information assumes a social good. If the incentive increases (i.e. Price) does that mean it is socially good to fulfill that demand? What social good is fulfilled by products made for one disposable and destructive purpose, i.e. military?

21 Human capital is more costly to maintain and replace than physical capital, so it is an incentive in any business to reduce the reliance on human capital.

23 Price essentially determines the worth of a person. It might be fine if price encompassed all areas of life but the economy routinely does not assign value due to conceptual problems. Assumes that without price as an incentive no saving would be done, so what did we do before money, starve? Assumes no dangerous work would be done, the incentive without price becomes the true incentive, make the work safer. False binary choice offered the only alternative to free market is command economy.

24 He makes a false analogy between everyone owning something and the state owning something. If everyone who lived in the housing had a hand in building it, the level of investment changes.

33 MF blames the weakening of familial cohesion on government paternalism when in fact the reason why family is weakening is because of the culture of robust individualism brought on by an economic model predicated on continual growth, in short the richer we are the more we substitute money for relationships.

Chapter 2: The Tyranny of Controls

40 Capital chases the lowest cost of labour. Every country has a poverty line. If, as MF previously argued, price is a reflection of cost and must be reflected in income, how does it make sense to undermine the means to earn income to gain a small cost advantage. People in general would be willing to pay more for products if they had a good paying job. Since people are price takers, they by default seek the best deal, to channel this behaviour, tariffs are needed to raise the cost of the imports above that of the domestics.

41 The only reason imports and exports make sense is because of the valuation of oil. It is underwritten by mass quantities of cheap energy. In an energy scarce scenario, you produce everything you can locally and import those thing you are unable to produce.

42 Surely he knows this argument is a farce. He should use another currency as an example. Any other currency but the US dollar. As the reserve currency of the world, there will always be a demand for it as long as oil is priced in dollars. The US doesn't have to manufacture anything as long as they maintain their dollar hegemony.

44 So to destroy comparative advantage all we have to do is what exactly? Why is an American worker 1.5 times more productive. Not because he is American, but because of information asymmetry which is protected through proprietary law. If we shared out the knowledge and best business practices, the only comparative advantage that would remain is a willingness to accept low wages and geographically located resources.

52 Britain version of free trade was mercantilism, essentially funneling goods from their colonies to the motherland while impoverishing the same colonies. The "collectivist" state of Hitler's Germany is more astutely framed as the reach of corporate power into the state, the very image of crony capitalism, which is defined, coincidentally, as fascist. Also consider why WWI started, not because some second-tier noble got assassinated but because of Germany's rise to power with the adoption of the American system of economics (which relied on infrastructure development and heavy use of tariff's). This threaten the balance of powers strategy that the English and the French had been employing for centuries.

54 Blames monopolies and cartels on govt regulation/interference. Once again, the cart is before the horse. Govt is an intermediary. Emasculate govt and TNC's would do it directly.

64. I would ask MF where the majority of the govt intervention goes on to benefit? The rich and the corporations. Follow the money and you'll find the root of the problem. I never see libertarians or objectivist protest that vigorously when the rich and too big to fail get bailed out, but talk about food stamps and holy fuck get out the pitchforks, we are going to a commie roast!

66 MF does not acknowledge the imbalance of power between employer and employee.

68 Portrayal of oil execs as victims is laughable. The oil cartel has the strongest lobby in the world, the have direct access to politicians which circumvents one person one vote. They effectively write oil legislation and in fact support regulation as it prevents new market entrants i.e. Porter's five forces.

69 MF goes on to rail against unions and blames govt for their power. All rights and obligations are codified in law and MF has no concept of the history of the struggle labour had to go through to gain these rights.

Chapter 3: The Anatomy of Crisis – No notes, basically the history and use of the Federal Reserve and it’s impact on the Depression.

Chapter 4: Cradle to Grave

98 Does MF not see that his words also apply to corporations? Who do corporations represent if not the predominately rich?

105 What is the point of the moral outrage? "people who would not lie to their children are lying to us...". Is useless rhetoric, meant to persuade by emotion not convince by way of reason.

106 MF thinks moral responsibility ends at the individual. He uses the example of children helping their parents out of love, depending on the same familial bond that has been weakened by robust individualism that he blames on gov’t paternalism on pg 33. What of those that have not even a familial bond, i.e. orphans? In MF’s view, no one needs to take responsibility for them as moral responsibility is individual and by extension familial. Doing the right thing shouldn’t be portrayed as a choice, as it never is a legitimate choice. Should I feed these starving people or should I ignore them and let them starve, this is the choice that MF wants to legitimatize.

107 Director's law. A middle class conspiracy against the rich.

108 MF complains about welfare programs, let us talk about tax cuts for the rich and increase in non-productive military spending. You’ll find that almost every tax cut for the rich and increase in military spending was partially bankrolled by cuts to social spending. Additionally, MF can include income “in kind” when he finally stoops to working out the "conceptual" problems of imputed labour for housework, specifically women's housework (Counting For Nothing, Marilyn Waring).

110 MF has no idea what causes crime. He thinks it is from getting welfare handouts and subsidized housing. So getting rid of government is going to fix crime? Crime is primarily spurred on by poverty and inequality.

122 Negative income tax. Why does this remind me of England's "solution" to poverty in the 1600's, the poor houses? MF seems to believe that people love being on welfare and that if we help them too much they will not bother to help themselves. This isn't true by and large. You'll find a few exceptions but the majority of people wish to be independent, self-sufficient, and feel like they are worth something. A negative income tax won't give them that, even welfare doesn't give them that.

123. MF assumes that private charities will step in to fill the void. The common argument is that communities stepped in to help out before there were governments. This is true, but with the onslaught of ever increasing debt, work hours, two income families, communities have been reduced to neighbors with tall fences. Socialism by government stems from the fact that communities do not/cannot do it anymore. If you want communities/private charities to fill in the gap, then you must reinvest in communities again. Otherwise negative income tax schemes and offloading social concerns on localities smacks of rich people not wanting to pay for well-being of poor people thereby perpetuating the inequality gap.

Additionally, if MF is such a big believer in social and economic Darwinism, why have the “superior” solutions of private charities not overtaken and out-competed the current model? For that matter why have free markets never materialized?

124. He makes one think that it is a free choice how one chooses to fund their retirement. It is a free choice to those with money, does he think that a negative income tax will for someone who is impoverished for most of their life, cover their retirement? Perhaps MF thinks private charities will plug that gap too. Out of sight out of mind. And for an economy that is 3/4 driven by consumer activity, how much capital formation does he expect to take place in an already credit drenched, over extended society?

125. Again radical welfare reform is no different than the rich aristocrats deciding that it was necessary to allow the poor to starve, because without hunger, how else do you expect the poor to work? Asinine. Give a person useful work, give them a sense of purpose, allow them to have some say in how the work is accomplished and that is all the motivation they need.

Chapter 5 – Created Equal

128. Setting up a straw man with equality of outcome. No one expects income distribution to be equal for all players. If you work hard and/or are brilliant you should keep more. Where I take issue is when the rich who may or may not have even worked for their wealth think they can pay proportionately lower taxes than the middle and lower incomes. They are under the impression that they earned the wealth all by themselves when in fact they are wealthy partly because they are hardworking/smart/lucky but also because the environment in which they work is conducive to allowing you to make income. Which is paid for by everyone who can pay, proportionately. When I hear about billionaires who are leaving the country in which they earned their wealth because they do not want to pay their fair share, it strikes me as profoundly ungrateful. You make it and you pay it forward, if you don't the alternative is unrest.

129. Thomas Jefferson = huge irony.

131. Inequality with freedom is an oxymoron. The poor have no freedom in poverty, their every action limited by debt and lack of money. The rich seem to be more free physically, but as a minority they have to spend their lives using their wealth as leverage to insulate themselves from the masses. Ever fearful that those beneath will rise to take from those above. Hence we have authors like Milton Friedman, Ayn Rand, Frederich Hayek, Bastiat all justifying the inequality by calling it just and natural and condemning any notion of what is fair as collectivism.

135. Fairness is proportionality. If a middle class person is expected to pay up to 40% of his income in taxes how are we to view a rich person paying an effective rate of 17% as fair or just? Basically MF says that if we don't allow the rich to keep almost all of their money then how else are we going to make the producers produce. At a certain point, vast amounts of money is pointless and more than a little obscene. A doctor make $250K to a couple million a year is just and fair. They provide a much needed service and should be paid commensurate with their experience. A hedge fund manager taking home 10's of millions as a bonus is unnecessary since they do not also assume the downside. The bonus is privatized but the loss is socialized. But in any case both the doctor and the hedge fund manager should pay a proportionate amount in taxes.

136. Ludicrous. Find me someone who actual supports this position that those with talent should be encouraged less than those without? Common sense recognizes that everyone has different strengths, you emphasize the strengths and compensate for the weakness as best you can, no one suggests holding people back. Why else would we live in such a fiercely competitive society with such a fiercely competitive economic system?

137. MF is leading into social Darwinism here. The desire for a society for less inequality doesn't arise because we want to compensate for the lack of nature's gifts, but because we want the security to live with dignity. MF should remember this feeling from his own poverty, but like most formerly poor he wishes to forget his own poverty and protect his new-found wealth. About Ali, what do you think he fought for before he climbed the ranks, about the pay of a dockworker.

139. Rockefeller Foundation, founded as a PR stunt after shooting down union members. MF says there is no inconsistency between the free market and compassion. Perhaps he meant to say there is no intersection between the FM and compassion. One is performed outside of the other, there is no profit in compassion, that is a social decision we make is not a rational market decision. If (rich) D deciding what he will do for (poor) A worked so well, then why did it become necessary for B and C to decide for D? Could it be that D could not, for self-interest in maximization, make the right and just decision? When you espouse a philosophy that puts a premium on self-empowerment and bearing the consequences and fruits of ones own decisions, how do you possibly expect the charitable response of individuals to play out in a positive way?

141 Rather than going on about equality of outcome, how about equality of dignity? As anyone who has had to live only by the sufferance of those better off, dignity is by far the most important virtue and the very least any civilized society should offer without question or judgement: food, drink, medicine, shelter. Something the rich of our society lack is humility, a very Christian virtue. When freedom takes on the shape of one individual buying their own private island while millions starve, this is without question an egregious form of violence. At the very heart of it, when an executive purchases their own private jet, they are saying that the millions of starving are worth nothing. How to rectify? Live reasonably, buy goodwill with your largesse. What is "reasonable" is what is proportional to your wealth. Are you worth a billion dollars, perhaps living on 10% of that is reasonable. And with the other 90% do good works. This is what it is like living in a siphon society as opposed to a funnel society.

142 No one goes into public service to get rich. There are two types of people that go into public service, those that want to do good, and those that want a particular piece of legislation. Also there is no equivalence in the argument of wanting less inequality and wanting everyone to be equal, MF is attempting reductio ab absurdum, but it is in fact another straw man. Under no circumstances do I think a doctor should be paid as much as a waiter. I would be interested to see just which egalitarians are making this argument as MF refers to them, but not by any identifiable name, which makes me think, they do not in fact exist. Also if voluntary redistribution worked in a capitalistic, competitive society, we wouldn't need compulsory taxes to accomplish what must be done and make no mistake, historically speaking, some redistribution must happen to protect the wealth of the upper class. You see this with debt jubilee's, relaxing of debtor laws, granting of labour rights, granting of legal status.

145 Crude criminality does not stem from a drive towards equality (even his equality of outcomes) is stems from deprivation. Poverty is the source of crime, reduce poverty you will reduce crime.

146 Interesting MF uses the words "permitted" because indeed a free market must be permitted by law (imposed) to operate or else it would not exist on a grand scale. Polanyi illustrates this in The Great Transformation, free markets imposed by law, and the spontaneous social action that arose to stop it.

147 So what MF is describing when describing Russia is not an egalitarian society, it is in fact no different from the gradients of poverty and wealth seen in any capitalist society with the exception of a significant middle class.

148 Does not the accumulation of wealth and property require force as well? Force to earn it and force to keep it. And by its accumulation, does it not inflict violence on others so deprived to sustain such wealth?

Chapter 6 – What’s Wrong with our Schools

153 The public school system was a reaction to increasing industrialization. Business's required that people have particular skills, but not a wide range i.e. critical thinking. They needed factory workers, not scholars. MF typically blames the gov't when in fact he should be pointing the finger at business.

157 We have to tolerate some inefficiencies from an economic perspective, because a) markets do not internalize all costs into prices b) because some things that are important to our society are external to the market thus unimportant i.e. the environment.

161. Quality of education is deteriorating because it matters less now to business whether kids graduate. The market for those skills has collapsed with outsourcing and automation. The kids that do go on to college and university are enough to satisfy the knowledge and service industries’ steadily shrinking market.

168 Coons and Sugarman are right. For a man who denigrates the Govt so much MF seems quick to allow the Govt to subsidize the choices of the rich. The term economic segregation is clear enough, those that can already afford private schools will then use govt vouchers to drive up the price of the private schools keeping them out of reach for the poor. In essence, nothing changes for the poor except the rich no longer have to directly subsidize their education.

169 Perhaps in America where social costs are frequently a target of politicians looking to make cuts to support tax cuts for the rich and increased military spending, but in other places in the world, socialized education works i.e. Canada.

177 He characterizes state run colleges and universities as places where slackers go to party and drop out. He has no idea why students drop out, but considering most of the students come from a class that can't afford ivory tower tuition, I would hazard to guess money and opportunity are the main reasons for dropping out, a much more plausible reason than laziness, and partying.

179 The invisible hand or the invisible fist? MF makes the argument that education should be primarily available to those with the private incentive to get it i.e. money. I would make the argument that education should be primarily available to those with the interest and the ability. Money should not enter the picture. Since we both agree that education serves both the public and private interest, money should not be the bottleneck that bars the way. His argument that those that go only because it is subsidized do not value it as much if they paid and could pay full cost. He uses the word “willing” and misses the word "able". That is like saying a starving man will not value a subsidized apple because he cannot pay the full cost. Best way to keep the lower classes in their place is to put education out of their reach. What does MF feel about libraries I wonder? Probably don't trouble him much because a library cannot confer a piece of paper that says you know something.

184 In quoting the U of C study he makes it seem like the rich and middle class are having a joke at the expense of the poor. If the poor are not receiving proportional benefit from the subsidy then how by raising the costs of education will it make it more accessible? There are currently private institutions but not one of them is cheaper than the subsidized state run schools. Also let's address the reasons why the poor may not be taking advantage of the subsidy. They may be ill-prepared from a life of deprivation or more likely they are working three jobs to makes ends meet and have not the time or money to avail themselves. Pay or borrow for higher fees. Hmmm trillion dollar student debt bubble? MF hates it when regulations hold someone back but seems to have no problem with money being the gatekeeper. Sure let investor's invest directly in the student by buying a share in future earnings. That has no possibility whatsoever of being abused. /sarc. It is slavery by another name.

Chapter 7 – Who Protects the Consumer?

191 Shout out to EF Schumacher. I do agree that regulation has gotten out of hand. For every regulation/law proposed, 2 should be repealed.

192. How does MF explain planned obsolescence? Government made products tend to be made to last so as not to have to pay for more of the same. It usually involves higher upfront costs, but they last longer. An unfortunate example that comes to mind is the AK-47.

197-199 All I see here are businesses that couldn't accept the free market and tried to circumvent it at ever turn. They found that government is the perfect tool.

215 He blames consumers for pollution not producers. This is not a chicken-egg argument. Beyond our necessities for life, food, drink, shelter, all wants are manipulated by producers advertising their product. How could a consumer want an iPad if none had ever been produced? He is correct that the cost for cleaner air and water must be born by the consumer which leads to another problem inherent in our economic system: inequality. When the gap is so great the amount the majority would have to pay exceeds their ability to sustain themselves. For example pollution primarily driven by China and the US affect the climate in Africa, how are the Africans to pay to offset the effects of pollution when they cannot feed themselves? The rich routinely make decisions with "their" wealth that have real implications for the rest of us. If Director's law is an issue then does not a proportional graduated tax address this? If most regulations benefit the rich and middle class and they pay the greater portion of the taxes proportionately, then what exactly is your beef?

217 Cheapest way to keep down effluent is illegal dumping. You only pay if you get caught.

218 Comparing horseshit to automobile exhaust. I realize this book is somewhat dated, but I can't help but say horseshit never contributed to climate change.

220 I would be interested in MF take on the DEA. I have often thought about the conflict of interest of prosecuting the war on drugs which has essentially grown from a budget of 100 million in 1973 to 20 billion dollars plus today.

222 Private enterprise will never mobilize capital for a profit loss scenario. They cannot. And there are many situations in which governments need to mobilize capital in scenarios in which their can be no profit.

224 Edward Bernays would heartily disagree. We are profoundly influenced by advertising and by others. If we were not then why did MF bother to write this book? It is advertising, some would say propaganda, but it influences none-the-less.

225 MF solution to monopolies is not legislation, it is opening up to international trade. Now I have an unfair advantage because I have the weight of future (his future, my past) events on my side, but how did he not think that same scenario that lead to national monopolies would not also lead to international monopolies/cartels? Introducing the Transnational Corporation.

227 I agree with his alcohol/drug policy.

Chapter 8 – Who Protects the Worker?

228 MF is being deceitful. True, officially recognized unions were few and far between, but union-like behaviour, strikes, work slow downs, protests, petitions existed for a long time and in great numbers. It was workers banding together that won better working conditions long before the govt gave them legal status (indeed the gov’t often sided with the owners). Any other view on this is ahistorical.

229 It was workers willing to stand up to government and capitalists that won the rights and enhanced the working conditions of all workers whether they were in unions or not.

231 Designating the Hippocratic Oath as a precursor to the first union. Paranoid? Just like we wouldn't let just anyone call himself a doctor today, they wouldn't back in ancient Greece. We require competence in our doctors.

232 Apparently the high wage earners in MF's world are those that are part of unions and those that are part of govt. Who are the highest paid workers in the world? CEO's of private companies.

234 Note: I am more than 2/3 of the way through and I do not believe I have heard MF once address military spending. He only attacks social spending. In fact, except for a brief swipe at GI benefits, he goes out of his way to exclude the military from his numbers.

In his argument against unions (union employ fewer people at higher wages forcing people to seek work elsewhere, their numbers bidding down non-union jobs) exposes the same flaw with international trade. Labour, a commodity, gets traded like anything else. Capital chases the lowest cost of labour. Hence access to greater pools of labour (i.e. displaced Mexican corn farmers) drives down the cost of labour. Another thing MF misses or doesn't address is that we need less labour overall due to innovations in technology and energy use. This, combined with access to global labour pools, drives down wages. Unions make up a small portion if anything.

MF says that all raises come from the productivity dividend. It used to, now it goes primarily to SH and management. Any raises that do come now, mostly come from inflation.

Raises in excess of productivity would come from other workers. I can agree with that as it explains the increasing pay gap between management and front-line workers.

235 We all wear the consumer hat at sometime. But in this economic system we must wear the worker hat first before we consume. So giving people high wages, as long as prices are affordable to those wages is no loss. High wages requires that the productivity dividend is shared out more fairly and not hoarded by owners and management.

MF says unions and governments are in cahoots. Laughable. And completely ahistorical. I suggest Howard Zinn’s A People’s History of the United States for a real picture of the governments relationship with unions.

236 Again he complains of the violence used by unions to enforce their demands. MF is either ignorant of history or being willfully deceptive. The violence perpetrated against workers by both owners and govt far exceeded anything workers have done. Any violence would have been in reaction to injustices inflicted upon them. MF perhaps is affected by the hierarchy of force. Any violence that travels down the hierarchy from the upper class to the lower class is acceptable, routine and often invisible. Any violence traveling up the hierarchy is shocking and very visible. Any violence traveling in the wrong direction is dealt with harshly and immediately.

237 I address the minimum wage argument of Jacob Spinney and others in prior post here. They are MF's arguments verbatim.

243 MF takes umbrage at the idea that anyone's salary or pension should be linked to the cost of living. What is the alternative that it should be linked to the price of malnutrition? Anywhere there is inflation wages should be adjusted to compensate to preserve purchasing power. I suspect that the outrage is because to link wages to inflation removes the ability of capitalists to give “raises” that are funded by an increase in the money supply and not from the productivity dividend.

Also just how common was workmen's comp in the private sector, before it was legislated?

246 MF assumes that there is equal power between employers and employees. How could that possible be the case when one sells commodities and one is a commodity? If the supply of labour is greater than the number of jobs and in a global context it always will be, then the employer has more power. MF also assumes that the employee is more mobile than the employer, this is no longer the case when a TNC can move its headquarters through filing some paperwork across international borders, in one day. Lastly, it is a requirement that one works to live, people need money more than employers need people.

247 MF reinforces that the free market and competition lead to growth which provides the excess needs for raises. But historically we know that markets don't always grow, of course MF would maintain that there has never been a true free market, the “No True Scotsman” argument. But his free market experiment got played out again and again through Jeffrey Sachs use of "shock therapy" in places like Bolivia, Argentina, Chile, Poland, Russia. It turn out to be pretty good for the rich, not so good for everyone else. And there was nothing voluntary about it. Most packages were created in secret and rushed through voting and had to be enforced forcibly.

Chapter 9 – The Cure for Inflation

254 So far I am mostly in agreement with MF's analysis of inflation. He seems to put the blame squarely at the govt feet, but recall, in the US the Federal Reserve makes monetary policy and the Federal Reserve, despite it's name, is a private institution that happens to have a monopoly on the creation of US currency.

268 The product and placement paid for by printed money matters. To take MF's example of workers building a road where none was before. If the road was built in the middle of nowhere and of little use, inflation will most definitely result. If the road was built to connect a town that up till that point had to pay to fly products in, then the cost of transport will dramatically fall, driving down costs and more than offsetting any inflation and everyone is better off.

283 I wonder if MF thinks centralize spending for the military is socialist?

Chapter 10 – The Tide is Turning

286 Maybe that is the problem, we can no longer have parties of principle but rather expediency and compromise. What are we expediting and with whom are we compromising?

291. Isn't he also describing how the free market works. Do not products work cross-purposes to each other? MF has no problem with waste as long as it is voluntary and in the confines of the free market, because he does not castigate all the legions of free market capitalists that have lost their shirt starting a business that failed. How many start-ups succeed? Something like 10%.

Thought: could the free market solve an impending meteor strike?

305 If price is speech then why is it so garbled?

309 For a word he uses so often did he define what "freedom" means?