Category Archives: Economy

An Obituary For Pinochet By George Reisman

BAB's A List, Economy, Foreign Policy, Left-Liberalism And Progressivisim, Socialism

Left-liberals do their demented St. Vitus Dance every time Augusto Pinochet is mentioned. Now that the General is dead, Prof. George Reisman puts paid to the myths the left (and the right, increasingly) has propagated about him.

George Reisman is the author of Capitalism: A Treatise on Economics (Ottawa, Illinois: Jameson Books, 1996) and is Pepperdine University Professor Emeritus of Economics. His website is www.capitalism.net. and his blog is at www.georgereisman.com/blog/. Prof. Reisman is also a regular on BAB (see BAB’s A List).
I’m taking this opportunity to let you know that forthcoming on BAB is an exclusive piece by another fabulous and formidable libertarian thinker, Thomas Szasz. Stay tuned.—ILANA

AN OBITUARY FOR PINOCHET BY GEORGE REISMAN

General Augusto Pinochet Is Dead.

On Sunday, December 10, General Augusto Pinochet of Chile died, at the age of 91. General Pinochet deserves to be remembered for having rescued his country from becoming the second Soviet satellite in the Western hemisphere, after Castro’s Cuba, and, like the Soviet Union, and Cuba under Castro, a totalitarian dictatorship.

The General is denounced again and again for the death or disappearance of over 3,000 Chilean citizens and the alleged torture of thousands more. It may well be that some substantial number of innocent Chilean citizens did die or disappear or otherwise suffered brutal treatment as the result of his actions. But in a struggle to avoid the establishment of a Communist dictatorship, it is undoubtedly true that many or most of those who died or suffered were preparing to inflict a far greater number of deaths and a vastly larger scale of suffering on their fellow citizens.

Their deaths and suffering should certainly not be mourned, any more than the deaths of Lenin, Stalin, and Hitler, and their helpers should be mourned. Had there been a General Pinochet in Russia in 1918 or Germany in 1933, the people of those countries and of the rest of the world would have been incomparably better off, precisely by virtue of the death, disappearance, and attendant suffering of vast numbers of Communists and Nazis. Life and liberty are positively helped by the death and disappearance of such mortal enemies. Their absence from the scene means the absence of such things as concentration camps, and is thus ardently to be desired.

As for the innocent victims in Chile, their fate should overwhelmingly be laid at the door of the Communist plotters of totalitarian dictatorship. People have an absolute right to rise up and defend their lives, liberty, and property against a Communist takeover. In the process, they cannot be expected to make the distinctions present in a judicial process. They must act quickly and decisively to remove what threatens them. That is the nature
of war. The fate of innocent bystanders, largely those who cannot be readily distinguished from the enemy, is the responsibility of the Communists. Had they not attempted to impose their totalitarian dictatorship, there would not have been any need to use force and violence to prevent them, and thus the innocent would not have suffered.

Contrary to the attitude of so many of today’s intellectuals, Communists do not have a right to murder tens of millions of innocent people and then to complain when their intended victims prevent their takeover and in the process kill some of them.

General Pinochet was undoubtedly no angel. No soldier can be. But he certainly was also no devil. In fact, if any comparison applies, it may well be one drawn from antiquity, namely, that of Cincinnatus, who saved the Roman Republic by temporarily becoming its dictator. Like Cincinnatus, General Pinochet voluntarily relinquished his dictatorship. He did so after both preventing a Communist takeover and imposing major pro-free-market
reforms, inspired largely by Milton Friedman (who in large part was himself inspired by Ludwig von Mises). The effect of these reforms was to make Chile’s the most prosperous and rapidly progressing economy in Latin America, Thereafter, in the words of his New York Times’ ‘largely hostile’ obituary, he used his remaining power to “set limits, for example, on economic policy debates with frequent warnings that he would not tolerate a return to statist measures.”

General Pinochet was thus one of the most extraordinary dictators in history, a dictator who stood for major limits on the power of the state, who imposed such limits, and who sought to maintain such limits after voluntarily giving up his dictatorship.

When General Pinochet stepped down, he did so with a guarantee of immunity from prosecution for his actions while in power. However, the present and previous regime in Chile violated this agreement and sought to ensnare the General in a web of legal actions and law suits, making the last years of his life a period of turmoil. This was a clear violation of contract, comparable to the seizure of property in violation of contract. Not surprisingly the regimes in question were avowedly socialist. As a result of their breach, it is now considerably less likely that the world will soon see any other dictator voluntarily relinquish his power. The Chilean socialists will have taught him that to be secure, he must remain in power until he dies.

*****

Dictatorship, like war, is always an evil. Like war, it can be justified only when it is necessary to prevent a far greater evil, namely, as in this case, the imposition of the far more comprehensive and severe, permanent totalitarian dictatorship of the Communists.

Despite the fact that General Pinochet was able to use his powers as dictator to enact major pro-free-market reforms, dictatorship should never be seen as justified merely as a means of instituting such reforms, however necessary and desirable they may be. Dictatorship is the most dangerous of political institutions and easily produces catastrophic results. This is because a dictator is not restrained by any need for public discussion and debate and thus can easily leap headlong into disasters that would have been avoided had there been the freedom to criticize his proposed actions and to oppose them. And even when his policies may be right, the fact that they are imposed in defiance of public opinion operates greatly to add to their unpopularity and thus to make permanent change all the more difficult.

On the basis of such considerations, when asked many years ago what he would do if he were appointed dictator, von Mises replied, “I would resign.”

©2006 by George Reisman.

Manufacturing Ignorance By George Reisman

Economy, Education, Human Accomplishment, Literature, Reason

My guest today on Barely a Blog is Prof. George Reisman. He is the author of Capitalism: A Treatise on Economics (Ottawa, Illinois: Jameson Books, 1996) and is Pepperdine University Professor Emeritus of Economics. His website is www.capitalism.net. and his blog is at www.georgereisman.com/blog/. In this essay, Prof. Reisman homes in marvelously on the philosophical underpinnings that are responsible for the bumper crops of ignoramuses the schools produce.—ILANA

Manufacturing Ignorance: The Root Cause of Contemporary Miseducation

By George Reisman

Ask yourself if the following paragraph would seem believable to you if you were to read it a in a newspaper:

Washington, D. C., Oct. 10. Following in the footsteps of “No Child Left Behind,” the Department of Education is considering new requirements applicable to all colleges and universities benefiting in any way from federally financed programs, such as student loan and dormitory-financing programs. Continued eligibility for participation in the programs would require graduates receiving a baccalaureate degree to demonstrate at least a 9th-grade level of reading ability and a 7th-grade level of ability in mathematics.

I think that the deplorable state of contemporary education that is indicated in that paragraph is essentially accurate and that the paragraph would probably be accepted by the majority of informed people without challenge, as a straightforward news report.
In my book Capitalism, I explain a root cause of the collapse of contemporary education in terms of its essential, guiding philosophy. Here is my explanation. It begins with a quotation from W. T. Jones, a leading historian of philosophy. The quotation describes the philosophy of Romanticism, which appeared as a hostile reaction to the Enlightenment:

To the Romantic mind, the distinctions that reason makes are artificial, imposed, and man-made; they divide, and in dividing destroy, the living whole of reality—”We murder to dissect.” How, then, are we to get in touch with the real? By divesting ourselves, insofar as we can, of the whole apparatus of learning and scholarship and by becoming like children or simple, uneducated men; by attending to nature rather than to the works of man; by becoming passive and letting nature work upon us; by contemplation and communion, rather than by ratiocination and scientific method. (W. T. Jones, Kant to Wittgenstein and Sartre, vol. 4 of A History of Western Philosophy, 2d ed. (New York: Harcourt, Brace, and World, 1969), p. 102.

The Romantics held that “we are nearer to the truth about the universe when we dream than when we are awake” and “nearer to it as children than as adults.” (Ibid., p. 104.) The clear implication of the philosophy of Romanticism is that the valuable portion of our mental life has no essential connection with our ability to reason and with the deliberate, controlled use of our conscious mind: we allegedly possess it in our sleep and as children.

In its essentials, the philosophy of Romanticism is the guiding principle of contemporary education. Exactly like Romanticism, contemporary education holds that the valuable portion of our mental life has no essential connection with our ability to reason and with the deliberate, controlled use of our conscious mind—that we possess this portion of our mental life if not in our sleep, then nevertheless as small children.

This doctrine is clearly present in the avowed conviction of contemporary education that creativity is a phenomenon that is separate from and independent of such conscious mental processes as memorization and the use of logic. Indeed, it is an almost universally accepted proposition of contemporary pseudoscience that one-half of the human brain is responsible for such conscious processes as the use of logic, while the other half is responsible for “creativity,” as though, when examined, the halves of the brain revealed this information all by themselves, perhaps in the form of bearing little labels respectively marked “Logic Unit, Made in Hong Kong” and “Creativity Unit, Made in Woodstock, New York.” Obviously, the view of the brain as functioning in this way is a conclusion, which is based on the philosophy and thus interpretative framework of the doctrine’s supporters.

Now, properly, education is a process by means of which students internalize knowledge: they mentally absorb it through observation and proof, and repeated application. Memorization, deduction, and problem solving must constantly be involved. The purpose is to develop the student’s mind—to provide him with an instantaneously available storehouse of knowledge and thus an increasingly powerful mental apparatus that he will be able to use and further expand throughout his life. Such education, of course, requires hard work from the student. Seen from a physiological perspective, it may be that what the process of education requires of the student through his exercises is an actual imprinting of his brain.

Yet, under the influence of the philosophy of Romanticism, contemporary education is fundamentally opposed to these essentials of education. It draws a distinction between “problem solving,” which it views as “creative” and claims to favor, and “memorization,” which it appears to regard as an imposition on the students, whose valuable, executive-level time, it claims, can be better spent in “problem solving.” Contemporary education thus proceeds on the assumption that the ability to solve problems is innate, or at least fully developed before the child begins school. It perceives its job as allowing the student to exercise his native problem-solving abilities, while imposing on him as little as possible of the allegedly unnecessary and distracting task of memorization.

In the elementary grades, this approach is expressed in such attitudes as that it is not really necessary for students to go to the trouble of memorizing the multiplication tables if the availability of pocket calculators can be taken for granted which they know how to use; or go to the trouble of memorizing facts of history and geography, if the ready availability of books and atlases containing the facts can be taken for granted, which facts the students know how to look up when the need arises. In college and graduate courses, this approach is expressed in the phenomenon of the “open-book examination,” in which satisfactory performance is supposedly demonstrated by the ability to use a book as a source of information, proving once again that the student knows how to find the information when he needs it.

With little exaggeration, the whole of contemporary education can be described as a process of encumbering the student’s mind with as little knowledge as possible. The place for knowledge, it seems to believe, is in external sources—books and libraries—which the student knows how to use when necessary. Its job, its proponents believe, is not to teach the students knowledge but “how to acquire knowledge”—not to teach them facts and principles, which it holds quickly become “obsolete,” but to teach them “how to learn.” Its job, its proponents openly declare, is not to teach geography, history, mathematics, science, or any other subject, including reading and writing, but to teach “Johnny”—to teach Johnny how he can allegedly go about learning the facts and principles it declares are not important enough to teach and which it thus gives no incentive to learn and provides the student with no means of learning.

The results of this type of education are visible in the hordes of students who, despite years of schooling, have learned virtually nothing, and who are least of all capable of thinking critically and solving problems. When such students read a newspaper, for example, they cannot read it in the light of a knowledge of history or economics— they do not know history or economics; history and economics are out there in the history and economics books, which, they were taught, they can “look up, if they need to.” They cannot even read it in the light of elementary arithmetic, for they have little or no internally automated habits of doing arithmetic. Having little or no knowledge of the elementary facts of history and geography, they have no way even of relating one event to another in terms of time and place.

Such students, and, of course, the adults such students become, are chronically in the position in which to be able to use the knowledge they need to use, they would first have to go out and acquire it. Not only would they have to look up relevant facts, which they already should know, and now may have no way even of knowing they need to know, but they would first have to read and understand books dealing with abstract principles, and to understand those books, they would first have to read other such books, and so on. In short, they would first have to acquire the education they already should have had.

Properly, by the time a student has completed a college education, his brain should hold the essential content of well over a hundred major books on mathematics, science, history, literature, and philosophy, and do so in a form that is well organized and integrated, so that he can apply this internalized body of knowledge to his perception of everything in the world around him. He should be in a position to enlarge his knowledge of any subject and to express his thoughts on any subject clearly and logically, both verbally and in writing. Yet, as the result of the miseducation provided today, it is now much more often the case that college graduates fulfill the Romantic ideal of being “simple, uneducated men.”

Iraqi War Blues By Tibor Machan

America, BAB's A List, Democrats, Economy, Iraq, War, WMD

I’ve said before that I’ve nothing new to say about the crime the Bush administration perpetrated in Iraq. Other than the necessary repetition, few have. I take that back. My guest today on Barely a Blog is Tibor Machan, who has come up with this philosophically acute principle: “Believing something that’s unjustified to believe doesn’t count as a reason for acting on the belief.”

Machan is RC Hoiles Professor of business ethics & free enterprise at the Argyros School of Business & Economics, Chapman University, and a research fellow at the Hoover Institution, Stanford University.

IRAQI WAR BLUES
By Tibor Machan

It is blues because it’s such a torment—to most Americans, to those who have died—and to a lot of families who have lost members—in this war, and to the supporters because they can’t advance a convincing reason to stay the course.

President George W. Bush may have wanted to hit Iraq even before 9/11 and his reason may well have been that he thought Saddam Hussein did hide some weapons of mass destruction. I have no idea whether Bush was honest but even if he was, it’s no excuse because believing that WMD were hidden in Iraq doesn’t appear to have been justified. Believing something that’s unjustified to believe doesn’t count as a reason for acting on the belief. Say you irrationally believe your spouse is cheating on you and so you decided to meet out punishment. It’s no excuse to say, “But I believed you were cheating on me— even if you did but in fact had no reason to.

Did Bush have good reasons, compelling ones, to think Iraq had WMD? There seems to be no support for this view anywhere now. So then attacking Iraq, while not anything most reasonable people could be too upset about so far as Saddam Hussein is concerned, doesn’t appear to have been justified.

How does this bear on the current debate as to whether the war in Iraq is “a war of choice”? Yes, this seems to be a big deal now—was the war necessary or did Bush decide to wage it as a matter of preference, something he didn’t need to do? Some—for example Republican pundit Morton Kondracke of weekend TV news program “The Beltway Boys”—think that since Bush believed there were WMD in Iraq, the war was not one of choice but of necessity. But this is the kind of justification I sketched above for punishing one’s spouse because one honestly but irrationally thinks one has been betrayed. Even if Bush honestly thought Iraq had WMD, if that belief was ill founded, as it evidently was, the war could be considered a war of choice. There was no objective necessity for it.

Mind you, most of Bush’s critics from among the liberal Democrats have no good case against him either. They haven’t ever objected to preemptive public policies that intrude on innocent people, let alone those under serious if mistaken suspicion. Just consider as a perfect current example how eagerly former VP Al Gore is urging his various precautionary measures—ones that would intrude on millions of us without any regard for civil liberties and due process—because he feels we face big risks from environmental hazards (global warming, climate change, what have you). Gore and his supporters, who complain about Bush’s preemptive war policies because they were preemptive, are hypocrites.

Only those who consistently uphold what we might dub the George Washington doctrine about getting America militarily entangled have a case against Bush & Co. These folks believe that free countries may only go to war when there is a justified and dependable belief that the country is under attack or about to be attacked. The emphasis here is on justified and dependable. Forcibly intervening in other people’s lives is only justifiable when these other people are mounting or about to mount an attack. A war is just, in other words, only when it is defensive.

George W. Bush’s war against Iraq was never defensive, not because he may not have believed the country needs defending from WMD, but because his and his administration’s beliefs about Iraq’s WMD were unjustified, ill founded. Nothing in the meantime, since the war commenced, has changed this fact. Not that there was nothing at all murky about Saddam Hussein and WMD. Yes there was, what with all that hide-and-seek involving the United Nations’ team of inspectors. But war is too big a deal, military, and indeed any other kind of aggression is too big a deal, to start in a murky situation.

Bush, of course, is no consistent follower of the George Washington doctrine. Nor are most of his liberal Democratic critics. So their quarrel about the war in Iraq is mostly incoherent. The only part that has some bona fide relevance concerns the issue of how long to keep American troops in Iraq now that the American military is there.