06 / June
06 / June
Worth Repeating #59

"To split or decentralize power is necessarily to reduce the absolute amount of power, and the competitive system is the only system designed to minimize by decentralization the power exercised by man over man."
--F.A. Hayek, The Road to Serfdom, 1944

posted at 12:34 AM
Comments

June, 1944:
"At 0400 hours of 5 June, I took the final and irrevocable decision: the invasion of France would take place on the following day."
Eisenhower
Sometimes there are things which can only be achieved by a centralization of power?

Posted by: Guido on June 6, 2007 09:56 AM

Yes, usually when it comes to killing people in vast quantities, the state excels.

Posted by: Ben-T on June 6, 2007 02:07 PM

"All right, but apart from the sanitation, the medicine, education, wine, public order, irrigation, roads, a fresh water system, and public health, what have the Romans ever done for us?"

Posted by: Ralph on June 6, 2007 03:42 PM

This is your new "democracy" flynnfile readers

http://digg.com/2008_us_elections/Reporter_Arrested_on_Orders_of_Giuliani_Press_Secretary

Posted by: asdf-2 on June 6, 2007 04:20 PM

Ralph, where have I heard that before? I kid of course.

Posted by: Ken on June 6, 2007 04:51 PM

"All right, but apart from the sanitation, the medicine, education, wine, public order, irrigation, roads, a fresh water system, and public health, what have the Romans ever done for us?" - Ralph

I hope you are not attempting to suggest, based on that quote, that the government of the Roman Empire was civilized or desirable, or that it is a defense of the state's role in those areas?

It is a testament to the virtue of the Roman people that even under the huge hindrance of their tyrannical and overbearing government, their society produced so much. They could have produced so much more, had they lived in a free one.

Posted by: Ben-T on June 6, 2007 06:42 PM

Ben T: I don't think they would have produced as much for parts of the world outside Rome if they had lived in a free society. The quotation is about Palestine...

The real question is about whether the brutal and oppressive means that are built into empire are justified by the positive consequences. I would say "no." Lots of people say, "yes," a tenable but ugly position, I think. Untenable is the Bushie position that we can extricate military empire from brutality and oppression and still get all the good consequences.

Posted by: skeptic on June 6, 2007 07:15 PM

Oh, doubtlessly they likely would not have, in that sense. Liberty and empire are enemies.

Regarding whether the ends justify the means, I must once again play the role of the pestering economist. In order to produce a good or service, one must pay an input cost for that good/service. That is to say that, in a highly simplified scenario, whenever we produce one more unit of X we have the potential to produce one less unit of Y. In a market we can communicate what people need, what value they place on things, and what goods/services ought be produced and in what quantities through the price mechanism. Through sales, firms learn what consumers demand, and they duly supply it.

The state has no similar mechanism for measuring demand. Doubtlessly, the Roman acquaducts represent some benefit for Roman society. Do they represent the greatest possible benefit those resources could have been used for? Likely not. Because it had no price mechanism, the Roman government had scant data with which to calculate how to maximize utility output from a given set of resources.

That is the reason why I say the Roman government, like all government, was a hindrance to its people.

Posted by: Ben-T on June 6, 2007 07:29 PM

Addendum: The government of the United States from the colonial era until the Civil War, was desirable and just. After that things began to devolve, culminating in the dual blows of the New Deal & Great Society.

Posted by: Ben-T on June 6, 2007 07:49 PM

http://physics911.net/gallery/

Posted by: asdf-2 on June 6, 2007 10:26 PM

Our Founders understood that government can be more of an impediment than an accelerator and should be limited to keeping the republic in line and protecting the nation’s citizens. They were smart enough to know that governmental interference can stifle freedom and creativity.

That concept and application works. What we've had in spades for the last 100 years or so is government that has regulated and squandered all manner of resources by interfering and putting a strangle hold on innovation via regulation and taxation.

Posted by: asdf on June 7, 2007 07:51 AM

Ben T: you seem to have an absolute faith that all possible goods will be and can only be found by the free market of individual actors. I don't think this is quite right, given the problems of scale, motivation, and charging per capita of something like the aquiducts. I am a thorough supported of the free market, but there are goods that are accomplishable by a group acting as a whole that is not accomplishable by the members acting individually.

In any case, you completely missed my point about whether the ends of empire justify the means. This was not a point about economics at all. The means here is the brutality of empire, the end is the civilization of (and development of basic economic steriods like roads and water supply in) backwater parts of the world.

Posted by: skeptic on June 7, 2007 01:56 PM

"Ben T: you seem to have an absolute faith that all possible goods will be and can only be found by the free market of individual actors. I don't think this is quite right, given the problems of scale, motivation, and charging per capita of something like the aquiducts. I am a thorough supported of the free market, but there are goods that are accomplishable by a group acting as a whole that is not accomplishable by the members acting individually." -skeptic

Then kindly explain how to communicate the wants and needs of an entire society independent of price.

If we postulate that the benefit offered by an aquaduct cannot be achieved by the market (a notion I would disagree with), all we have found is that the costs of producing an aquaduct outweigh the benefits it offers.

A belief in markets does not require faith, because it can be defended on purely rational grounds. A belief in the power of governments to maximize economic utility does.

"In any case, you completely missed my point about whether the ends of empire justify the means. This was not a point about economics at all. The means here is the brutality of empire, the end is the civilization of (and development of basic economic steriods like roads and water supply in) backwater parts of the world." -skeptic

No, I didn't. Please re-read the first paragraph of my post. I simply elaborated.

Posted by: Ben-T on June 7, 2007 06:27 PM

Ben: I don't believe that the power of government maximizes economic utility, so the cheap shot misses.

Look, I understand how the mechanism of free prices is the best measure of the value that individuals place on economic goods. But this works only when the good is susceptable to an individual price. There are some goods which cannot be bought by an individual alone. You can't pay for part of an aquiduct or for part of the invasion of Normandy. This is not an argument that such goods must be provided by government, but it is an argument that leaving all goods to the mechanism of individual free prices excludes all goods not susceptable to individual pricing.

And to reduce the question of civilization through empire to economics is absurd. Civilization is one of those things not susceptable to individual prices -- and not only because as a spiritual good it is beyond price, but because it isn't a consumer item for which people can be charged individually. Also, one cannot expect an uncivilized person to want to be civilized. There is a value here that cannot be gauged ahead of time by the people who benefit. Thus, civilization is not an economic good.

So here again is my point that you missed through your pan-economic lens: the Romans spread civilization fantastically, but necessarily with great brutality. Some (not I) say it is worth it.

Posted by: skeptic on June 8, 2007 12:59 PM

"Ben: I don't believe that the power of government maximizes economic utility, so the cheap shot misses." -- skeptic

But you do, or you wouldn't be defending the position that you are, accusing me of some irrational "faith" in free markets.

:Look, I understand how the mechanism of free prices is the best measure of the value that individuals place on economic goods. But this works only when the good is susceptable to an individual price. There are some goods which cannot be bought by an individual alone. You can't pay for part of an aquiduct or for part of the invasion of Normandy. This is not an argument that such goods must be provided by government, but it is an argument that leaving all goods to the mechanism of individual free prices excludes all goods not susceptable to individual pricing." - Skeptic

What? A firm could easily construct an aqueduct and then charge for its services on a subscription basis.

Not that I advocate anarchism, but you could even conceivably pay for invasion, via mercenaries.

"And to reduce the question of civilization through empire to economics is absurd. Civilization is one of those things not susceptable to individual prices -- and not only because as a spiritual good it is beyond price, but because it isn't a consumer item for which people can be charged individually. Also, one cannot expect an uncivilized person to want to be civilized. There is a value here that cannot be gauged ahead of time by the people who benefit. Thus, civilization is not an economic good." - skeptic

You are suggesting that it is right to invade the non-civilized in order to "civilize" them against their will, and that this cannot be provided by the market.

I agree that it is unlikely that the market would provide this "service". I am not worried about it, since it is a deeply evil act of aggression which we should all hope to see a lot less of.

The idea that civilization is created through mass military campaigns, or what made the Romans great was the amount of people they slaughtered or subjugated in order to "civilize" , is in itself perverse.

As to your statement that civilization cannot be created through a market in a free society, it is exactly the opposite of true. A free market society is the only agent which can create a civilization. The Romans were civilized to the extent that they were free, and barbaric brutes to the extent that they were conquerors of nations. Only a market society can produce, and only production is able to give people the amount of leisure time necessary to become civilized. Any other system is based on creating wealth through the destruction or subjugation of others, and so is based on barbarism at its core and will, without fail, collapse once it finds itself no longer able to subjugate or destroy others to sustain itself, as the Romans did.

The Roman people were a noble people who produced many great accomplishments. But the Roman *Empire* was fundamentally a parasitic organization that more or less nothing to improve the station of the people it ruled. Indeed, even the statement that the Romans civilized the world is just flatly wrong. The Romans did nothing to educate or civilize the people they ruled over, they simply extracted taxes from them. The people remained barbarians while the Romans ruled them and were barbarians after the Romans disappeared. It was the labors of the Catholic Church, not the Roman Empire, that civilized Europe. With the possible exception of the Romano-British (who promptly disappeared as a civilization once the Romans were gone) there was no Roman cultivation of the people whom they ruled.\

"So here again is my point that you missed through your pan-economic lens: the Romans spread civilization fantastically, but necessarily with great brutality. Some (not I) say it is worth it." - skeptic

I am afraid that it is you who has missed a much more important point. The statement "The Romans spread civilization" is simply a factually incorrect one. They did no such thing.

Posted by: Ben-T on June 8, 2007 01:30 PM

Typo Correction:

"You are suggesting that it is right to invade the non-civilized in order to "civilize" them against their will, and that this cannot be provided by the market." -myself

"You are suggesting that some say it is right*"

Posted by: Ben-T on June 8, 2007 01:31 PM

Ben: You are so busy assuming that you know what I think that you haven't bothered to read carefully. I don't think that the Roman benefit was worth the brutality, as I said already. I don't believe that government maximizes "utility": sometimes individuals acting as such do, and sometimes they don't, and when they don't some type of extra cooperation might be called for, and that sometimes might be government. But that doesn't amount to believing that government maximizes utility.

Your view of the aqueducts and the invasion of Normandy are fanciful. Subscription? Adopt-a-soldier? Look this phrase up: "free-rider problem", aka, "positive externalities." Aqueducts brought water to entire cities, not to individuals. I don’t think you are thinking concretely. You are thinking ideologically. This is actually rather easily settled. Was there in the ancient world (or even modern world!) an enterprise like the aquaduct, irrigating a whole city, built entirely by private enterprise contracting with individual subscribers? And give some examples of war, free of taxation, where you think the market has done what you say it can do. If you do this, then you win. If not, then you are being a faithful but fanciful ideologue.

Now I didn't say that civilization was created by mass military campaigns, and I didn't say that the freedom can't create civilization, and I didn't say that the Romans civilized the world, blah blah blah. Learn to read. My point is that the Romans spread civilization, specifically, they did a lot to increase the civilization (e.g., rule of law, stability, roads, etc.) in places that wouldn't have had such things themselves for a long time. I suspect, e.g., that one of the reasons ME culture and politics is so bad is because the Roman empire (and of course the Churh that followed it) barely got a foothold there. The market did -- the ME is famous for trading. Finally, it is false to say that once the military power of the Romans collapsed that the Roman accomplishments throughout their empire collapsed. This is an out-dated and prejudiced view of the "dark ages." But one thing that did happen was the aqueducts weren't kept up very well. It seems that individual enterprise not only couldn't build the aqueducts, it couldn't take them over once built.

Regarding your panglossian economic reductionism, I suggest you put more thought into two issues: (1) Aren't there externalities in all economic exchanges, and, if so, isn't basic economic anlysis always abstract -- not false, but incomplete? (2) Aren't there some goods that cannot be measured by individual monetary valuation because, e.g., the good changes the "consumers" such that the "consumer" can't gauge ahead of time the ultimate value of the good for them. Goods such as education, religion, and civilization?

Posted by: skeptic on June 9, 2007 02:02 PM

"You are so busy assuming that you know what I think that you haven't bothered to read carefully. I don't think that the Roman benefit was worth the brutality, as I said already." -skeptic

No, that was a typo. I added a correction after I posted.

"sometimes individuals acting as such do, and sometimes they don't, and when they don't some type of extra cooperation might be called for, and that sometimes might be government. But that doesn't amount to believing that government maximizes utility." - skeptic

What? Yes, it does. If you believe that there are situations where the government is better than the alternatives, then you believe there are situations where the government maximizes utility.

"Your view of the aqueducts and the invasion of Normandy are fanciful. Subscription? Adopt-a-soldier? Look this phrase up: "free-rider problem", aka, "positive externalities." Aqueducts brought water to entire cities, not to individuals. I don’t think you are thinking concretely. You are thinking ideologically. This is actually rather easily settled. Was there in the ancient world (or even modern world!) an enterprise like the aquaduct, irrigating a whole city, built entirely by private enterprise contracting with individual subscribers? And give some examples of war, free of taxation, where you think the market has done what you say it can do. If you do this, then you win. If not, then you are being a faithful but fanciful ideologue." - skeptic

When referring to the mercenary scenario, I said was not advocating anarchism, just pointing out the sloppiness of your thinking. However, of course there have been examples of private armies through history. Have you ever heard of feudalism?

The purpose of an aqueduct is to transport water to places. They are usually either transported to irrigate crops (where the farmers whose crops are being irrigates could pay for the services rendered) or into cities (where water could be sold to consumers directly). This is like suggesting that, if the government has a monopoly on the production of trucks, only the government could possibly produce trucks. If the benefits yielded by trucks outweigh the costs, people will pay to have them produced.

And, once again, even we were to postulate that the market cannot provide aqueducts, your assertion would still be flatly wrong. If the market cannot provide aqueducts, this means that the cost of constructing an aqueduct outweighs the benefits it yields, and constructing them is a bad idea all together.

"Now I didn't say that civilization was created by mass military campaigns, and I didn't say that the freedom can't create civilization, and I didn't say that the Romans civilized the world, blah blah blah." -skeptic

If you didn't believe that the Romans had civilized the world, you never would have postulated the question. If there was no percieved benefit to the Roman action, than the question of whether the "ends justified the means" as you put it, would be moot. Obviously, no. Either you do or you were postulating a misleading question for some reason I cannot guess.

"I suspect, e.g., that one of the reasons ME culture and politics is so bad is because the Roman empire (and of course the Churh that followed it) barely got a foothold there. The market did -- the ME is famous for trading. Finally, it is false to say that once the military power of the Romans collapsed that the Roman accomplishments throughout their empire collapsed. This is an out-dated and prejudiced view of the "dark ages." But one thing that did happen was the aqueducts weren't kept up very well. It seems that individual enterprise not only couldn't build the aqueducts, it couldn't take them over once built." - skeptic

What silliness. Capitalism as an economic system was not invented until the renaissance, and yet we are to believe that the Dark Ages represent the failure of a political-economic system that had not yet been born. Really. And of course, the idea that the Middle East failed to produce civilization is utterly ridiculous. The Middle East was either more or as advanced as the west until about the time of the renaissance, when capitalism was invented in Europe (chiefly in Italy). It was then that the west rocketed ahead of the rest, not because of Roman militarism but because free markets allowed for a maximum output from minimum resources.

Simply put, the Romans did not civilize other parts of the world. They conquered barbarians, ruled barbarians, and left barbarians in their wake. The rest of the world became civilized long after the fall of the Roman Empire, thanks to the labors of the Catholic Church.

Or, if you want to use the strictly academic definition of "civilization", as your belief that roads are a defining trait of civilization indicates, they were already civilized when the Romans arrived, having already developed towns of their own without Roman help or guidance.

Finally, no, it is not an outdated view that society collapsed during the Dark Ages. What has changed is the breadth of the time period which is referred to as the "Dark Ages". While it used to refer to the entire breadth of the medieval world, it now only extends to, at the latest, 1000 ad. It is not disputed that the period existed, however.

If free enterprise could not have built the aqueducts, than the aqueducts were, from the get to, a colossal waste of time and resources for everyone involved.

"Regarding your panglossian economic reductionism, I suggest you put more thought into two issues: (1) Aren't there externalities in all economic exchanges, and, if so, isn't basic economic anlysis always abstract -- not false, but incomplete? (2) Aren't there some goods that cannot be measured by individual monetary valuation because, e.g., the good changes the "consumers" such that the "consumer" can't gauge ahead of time the ultimate value of the good for them. Goods such as education, religion, and civilization?" - skeptic

The answer to the first question is: Yes, externalities exist, and the market corrects for them through the price mechanism.

The answer to the second question is: No. Consumers consider how much value they place on the effects of a good or service when they decide how much they are willing to pay for that good or service. But according to your ana-lysis of say, education, since we don't know exactly how much our horizons will be expanded by say, taking a class in history, there is literally no price we should not be willing to pay to attend the class (or it is at least impossible to affix a price onto a history class). This is ridiculous. People know that if they take a class in history they will know more about history and probably be a smarter person for it, even if they do not know by exactly how much. That is sufficient information for them to decide how many other opportunities they will be willing to forego (the cost) in order to focus resources on taking the class.

Cost essentially represents opportunities foregone in order to do something. If you invest time and resources into X, you can not invest those time and resources into Y. Every course of action yields some possible benefits. I do not need to know every single benefit I might gain from X to know whether or not I am willing to forego the opportunity of X to instead pursue the potential benefits offered by Y.

Posted by: Ben-T on June 10, 2007 04:43 PM

BenT: I believe there are situations in which groups organized (sometimes by government) are more able to "mazimize utility" than the members acting as individuals. (This is really really basic economics, look up "prisoner's dilemma.") This knowledge is not what you call it: "A belief in the power of governments to maximize economic utility" that "requires faith." I also believe there are many more situations in which government involvement decreases "aggregrate utility." This is the fallacy you are committing. I believe that there are some humans who are over 8 feet tall. You think that means that I have a faith humans are over 8 feet tall. Learn to think.

Feudalism does not count as a "private army" or an a mercenary force. Lords are governmental parties which exist partly through taxation. Given that you have failed my challenge to provide examples of private enterprise building something equivalent to the aqueducts, charging per subscription to irrigate cities as you suiggest, or of wars being fought in the adopt-a-soldier model you suggest, we can assume that you are being a fanciful ideologue rather than thinking concretely. Come on. Meet the challenge or admit you are wrong. Este vir.

"Capitalism as an economic system was not invented until the renaissance." Invented? Liberals and other ideologues have a terrible tendancy of using the word "capitalism" in such a way that no one can have any sense of what they are talking about. I think market dynamics are built in to human nature, and that the free market arises anywhere where there are private property rights protected by law in a situation of relative economic scarcity. Do you think law and property were "invented" in the "Renaissance"? Stop talking idiocy.

I didn't say and I don't beleive that the Romans civilized the world. You will not learn to think until you start being precise and fair with other people's ideas, instead of looking for ideas to attack to show off your smarts.

I didn't say the dark ages represented the failure of anything, let alone of the market. In fact, I suggested that the whole concept of the dark ages is overblown. It is disputed. Even your idiotic worshipping of the "Renaissance" betrays an uncritical swallowing of the modern prejudices in history.

I didn't say that the ME didn't produce a civilization. Learn to read. I suggested that the roman rule might have helped them avoid the biggest problems there: lack of respect for reason and the rule of non-revealed law.

If you think that the market corrects for externalities through the price mechanism than you do not understand the definition of "externality."

I didn't say there is no price we should not be willing to pay for a history class. That is ridiculous. But I didn't say it. I just said that the market can't reasonably be expected to correctly gauge the value of certain things to us when the value of those things consists in changing our values. I don't see how you can dispute this, if you understand the concepts involved in my sentence.

Look, I have no doubt that you understand concepts within economics rather well (except for externality), but what I'm asking you to do is think about where and how these concepts apply. What are the conditions of your economic ideas applying? There are legal and cultural conditions that must be met for the price mechanism to work well, there are personal conditions that need to be met in order for a person to value what is actually good for them, there are conditions that need to be met about the structure of the good and its supply and sale before we can expect individual pricing to measure its worth accurately. If you can't recognize these conditions you will not be able to approach economics non-ideologically.

Posted by: skeptic on June 10, 2007 06:03 PM

"BenT: I believe there are situations in which groups organized (sometimes by government) are more able to "mazimize utility" than the members acting as individuals. (This is really really basic economics, look up "prisoner's dilemma.") -- skeptic

No, it isn't, and the prisoner's dilemma does not prove it. In the prisoner's dilemma it is best for two parties to cooperate because they can each calculate what course of action is in their best overall interest.

The government of course, cannot do the same: http://en.wikipedia.org/wiki/Economic_calculation_debate

Unless you have come up with a formula to calculate an objective standard of utility, you will need a price mechanism to transmit data about how to best allocate resources.

"I believe that there are some humans who are over 8 feet tall. You think that means that I have a faith humans are over 8 feet tall. Learn to think" - skeptic

Please provide the calculations whereby you have arrived at an objective standard of utility. Until then, your position cannot be taken seriously. You believe, based on what is very much blind faith, that there is some rational way of allocating resources, in certain situations at least, absent a price mechanism. Indeed, the moderate position is the LEAST reasonable. If there is a replacement for the price mechanism, why is it only limited? Surely the government should be able to apply this replacement you have discovered across the board?

"I didn't say and I don't beleive that the Romans civilized the world. You will not learn to think until you start being precise and fair with other people's ideas, instead of looking for ideas to attack to show off your smarts." -skeptic

I take your positions to their logical conclusion. I know you disapprove of it.

Either you DO believe the Romans civilized the world, or the point is moot, as I pointed out. Support your assertion or retract it. If the Romans did not civilize the world then there is no question that what they did was not worth it, and you have no reason to even raise it.

"I didn't say the dark ages represented the failure of anything, let alone of the market. In fact, I suggested that the whole concept of the dark ages is overblown. It is disputed. Even your idiotic worshipping of the "Renaissance" betrays an uncritical swallowing of the modern prejudices in history." -skeptic

I was unaware that the renaissance began in 1000 A.D., where I posted the end of the dark ages at. Thank you for that insight. I actually place the end of the Dark Ages at the point at which Europe was (more or less) fully Christianized, and the period known as the "High Middle Ages" begins. The Renaissance was part of the Late Middle Ages, a separate sup-division of the medieval era. To suggest, however, that there was no period of cultural decay following the collapse in Europe of the Roman Empire, is patently ridiculous.

"Feudalism does not count as a "private army" or an a mercenary force. Lords are governmental parties which exist partly through taxation. Given that you have failed my challenge to provide examples of private enterprise building something equivalent to the aqueducts, charging per subscription to irrigate cities as you suiggest, or of wars being fought in the adopt-a-soldier model you suggest, we can assume that you are being a fanciful ideologue rather than thinking concretely. Come on. Meet the challenge or admit you are wrong. Este vir." -skeptic

Dodging the issue (like most of the rest of this post) is a logical fallacy. Please address the point that even if we should assume that the market cannot produce aqueducts, it is because they are a irrational use of resources.

In fact, that was my original point, I only mentioned as a by-line that I would guess the market could produce aqueducts. You were forced to seize upon that small point because you were unable to reply to the substance of the point.

"? Liberals and other ideologues have a terrible tendancy of using the word "capitalism" in such a way that no one can have any sense of what they are talking about. I think market dynamics are built in to human nature, and that the free market arises anywhere where there are private property rights protected by law in a situation of relative economic scarcity. Do you think law and property were "invented" in the "Renaissance"? Stop talking idiocy." -skeptic

It is hilarious that you mean to lecture me about thought, while you resort to ad hominem in nearly every paragraph of your post. Prior to the Renaissance economic transactions were conducted via fascism. The means of production were owned (obstensibly) privately but were under the full control of the state. By the late middle ages urban economies had developed to the point that true free trade could occur, without the constant interference of the noble class.

Trading is no doubt built into human nature, but that does not mean economic systems built on free transactions of privately owned resources will always be the norm. Absent an urban society, it is much easier for a particular ruling class to exert control over the means of production.

"I didn't say that the ME didn't produce a civilization. Learn to read. I suggested that the roman rule might have helped them avoid the biggest problems there: lack of respect for reason and the rule of non-revealed law." -skeptic.

To quote:

"I suspect, e.g., that one of the reasons ME culture and politics is so bad is because the Roman empire (and of course the Churh that followed it) barely got a foothold there." - skeptic

This implies that the causation of civilization in the west is Rome, at least in part (this also contradicts your previous profession that you do not believe Rome civilized the world. Did it or didn't it?) by giving the west a special respect towards reason that was absent in other societies. However, this is impossible, because for most of medieval history, the Islamic societies were as or more civilized than their European neighbors. They showed no refusal to abide by the laws of reason. We had Thomas Aquinas, they had Averroes. Moses Maimonides developed in an Islamic context and Islamic society, and so did Ibn Khaldun. There is simply no evidence that the Muslim societies are pre-disposed to reject reason any more than any other society or that the Roman Empire gave the west a special respect and dispensation towards reason.

If anything that came from the influence of Aristotle on European thought, which began after the fall of the Roman Empire, during the High Middle Ages. And we were, once again, not alone in that. Aristotle was also a huge influence upon the Islamic societies.


"If you think that the market corrects for externalities through the price mechanism than you do not understand the definition of "externality." -skeptic

I understand it perfectly well. Provide an example of an externality you feel free enterprise is helpless to solve and we will examine it.

"I didn't say there is no price we should not be willing to pay for a history class. That is ridiculous. But I didn't say it. I just said that the market can't reasonably be expected to correctly gauge the value of certain things to us when the value of those things consists in changing our values. I don't see how you can dispute this, if you understand the concepts involved in my sentence." -skeptic

I showed clearly why I dispute it in my sentence, because humans decide how to invest resources based on the opportunities involved. Any system must calculate based on opportunities, and to reject this is to reject reality.

"Look, I have no doubt that you understand concepts within economics rather well (except for externality), but what I'm asking you to do is think about where and how these concepts apply. What are the conditions of your economic ideas applying? There are legal and cultural conditions that must be met for the price mechanism to work well, there are personal conditions that need to be met in order for a person to value what is actually good for them, there are conditions that need to be met about the structure of the good and its supply and sale before we can expect individual pricing to measure its worth accurately. If you can't recognize these conditions you will not be able to approach economics non-ideologically." -skeptic

The concept of private property and the equality o fmen has to evolve. This is not something I credit the Roman Empire with, it was an institution that had no respect for property rights or equality. As I said before, yes, the west was civilized, and no, it was not done by the Roman Empire. The Catholic Church deserves the credit for our cultural dispensation, and capitalism deserves the credit for our enormous wealth and power.

Posted by: Ben-T on June 14, 2007 03:11 PM

P.S.: Good book about this is "The Victory of Reason: How the Rise of Christainity led to Freedom, Capitalism, and Western Success" by Rodney Stark.

Posted by: Ben-T on June 14, 2007 03:27 PM

Ben T:

1) "Logical Consequences" vs. Distortion: If X says that his points helped his team win the game, you think it is the "logical conclusion" that Jones thinks that he won the game. Distinguish "X does Y", from "X helps do Y." I don't know of many educated non-po-mo people who would deny that the Romans helped civilize the parts of the world they conquered. Same goes for the Greeks and the Chinese and the British. It does not follow that any one of those groups could be said to have "civilized the world."

2) Must there be one thing that always "maximizes utility"? You say, "If there is a replacement for the price mechanism, why is it only limited?" This betrays a serious vice your style of thinking. I didn't say there was a replacement for the price mechanism. I said that, if we understand why the price mechanism works so well, we also understand when it can't work as well, and in those cases sometimes another system of decision making might be better. Your thought process can't handle this type of practical truth where we adapt ourselves to the contingencies of circumstance. You need everything to be a simple answer. For you, if the individual price mechanism maximizes utlilty, it must do so in every situation; if cooperation maximizes utility, it must do so in every situation; if government maximizes utility it must do so in every situatioin. This is an ideological way of thinking, as though all practical know-how can be derived theoretically from pure reason. I say: sometimes a hammer is more useful and sometimes a bulldozer. You respond: If a bulldozer is so much better than a hammer, why don't we use it all the time?

3) Islam and Logos: I am not an expert in Middle Age Muslim philosophy, though I am glad that my comments caused you to do some wiki-research on it. I think what we see in the flowering and then collapse of Muslim philosophy and science (which was certainly flourishing before the enlightenment of the West's Middle Ages got going), is precisely a collapse of a respect for reason independent of revelation. This is what the pope's controversial Brandenburg speech was partly about last fall. The most important question here has to do with the conception of God in relation to reason. There were also serious debates in the West about the relation between reason and God (before the protestant reformation, but then this was a huge issue within the protestant reformation, too), but Christians have a special reason that Muslims lack to insist that God is not beyond reason, and that reason cannot conflict revelation: See John 1:1. The word for "word" there is "logos," "reason." You might want to read Benedict's speech, too.

4) Externalities: By definition an externality is a benefit or a cost to an action that is external to (does not affect) the people who are making the decisions about that action. For example, a serial killer gets a perverse pleasure from killing. This is a benefit to him. There is a cost, which does not effect the decision-maker, namely to the death of the victim and suffering of her family, etc. The market in which individuals act freely cannot correct this externality. This is a prime example of when government (or otherwise, coercive cooperation) "maximizes utility." It is a matter of degree, not of kind, between this and littering. Also, notice that it would be in the serial killer's benefit if society could change his values such that he did not get this perverse pleasure from killing. This is another externality that the market cannot handle: the serial killer cannot _within his currect preference schedule_ gauge the value of changing his preference schedule. Once again, if we think about why the mechanism of individual prices works so well, we can also understand why it cannot work perfectly (because no action completely lacks externalities) and when it might be better to use a different mechanism (because sometimes the externalities are very great and they can be handled better through types off coercive or noncoercive collusion). Notice also that your position entails anarchism: if government never maximizes utility, then government shouldn't exist.

5) Nonsense: I don't think you make any sense here. "I showed clearly why I dispute it in my sentence, because humans decide how to invest resources based on the opportunities involved. Any system must calculate based on opportunities, and to reject this is to reject reality." I am rather good at reading and making sense of unclear phrasing, but this does not adequately express the meaning you intend, perhaps because your meaning isn't clear in itself.

6) On the contrary, Rome certainly had SOME respect for equality and private property. Are you really saying that he insititutions of the rule of law (which requires some type of equality, even if imperfect) and of private property (the two are intimately related, btw) hadn't developed for and didn't exist within the Roman empire? Now, I don't credit the Roman empire with "inventing" these institutions, but it certainly had them to some degree and did a lot to increase and spread them in other places.

7) "The Catholic Church deserves the credit for our cultural dispensation, and capitalism deserves the credit for our enormous wealth and power." I think that you are too simplistic. There are many players in our culture, and the Church is a huge one (so are Greece and Rome, e.g.). The market doesn't exist independent of certain cultural conditions, such as the rule of law and private property, so giving the market credit for our wealth is also to give credit to cultural forces that secure the rule of law and property rights, which is partly Rome, partly the Church, partly the destruction of Middle Age restrictions on usury and guilds (e.g.), etc., etc.

8) Why are you talking Marxist? Prior to the Renaissance, the means of production were entirely controlled by the state? This is simply false. "The state" is an odd phrase to use for pre-Renaissance European government, beccause governmental authorities were, generally, centralized and monolithic. There was, however, property (including what you probably mean by "means of production", although in truth all property is in some sense "means of production") that was not controlled by governmental parties. The Lords didn't have a monology on property -- they weren't even unified themselves. Inferior property rights and equality under the law in Pre-Renaissance Europe compared to today in the U.S. -- absolutely. But did it exist? Certainly.

9) If you really think about the prisoners' dilemma, what we get is a situation in which individuals operating as individuals cannot maximize utility. They must collude in order to do so. Now, imagine a prisoners' dilemma problem at a massive scale -- say, involving 30 million people. How might this collusion happen, apart from government?

10) "Please address the point that even if we should assume that the market cannot produce aqueducts, it is because they are a irrational use of resources." Why? I have already given plenty of explanations for why the individual price mechanism generally won't produce goods like the aqueducts and the invasion of Normandy -- because of scale and because of serious externalities. You have in no way responded, or even shown an understanding of these arguments, and you have failed to produce any historical evidence that the individual price mechanism could produce these goods, let alone that it will do so reliably. So, I assume your historical wikipedia search has failed. Admit it. Given the failure of history to provide exmaples for you, it seems to me that the burden is on you to either admit that sometimes the mechanism of individual prices does not "maximize aggregate utility", or claim that things like public irrigation and public armies are never utile. I suggest you take the first option, I suspect you will take the second.

11) Simply insulting someone does not amount to an ad hominem fallacy. An ad hominem is when the insult is offered as a reason in an argument. When I say that you are thinking ideologically (one system must maximize utility all the time), idiotically (telling me that I think that Rome "civilized the world" when I deny it), abstractly rather than concretely (Normady should have been invaded by a private army on the adopt-a-soldier model), I am being descriptive and I am trying to make you want to think less sloppily, but I am not committing an ad hominem fallacy.

12) Bottom line: The world is complex. There is no reason to think that the truth about the world is any less complex. Hence, we should not insist that our favorite formulae can explain everything.

Posted by: skeptic on June 15, 2007 04:43 PM
Post a comment
Name:


Email Address:


URL:


Comments:


Remember info?