Category Archives: Political Philosophy

‘How Economic Inequality Is Essential for Successful Economic Competition by the Less Able’

Capitalism, Economy, Free Markets, Political Economy, Political Philosophy

Republicans, Democrats and conservatives—come to think of it, most people—do not fear flaunting their inveterate ignorance of economics. Thus almost all have railed against economic inequality to boost their empathy credentials and likelihood of being elected or re-elected.

The Capitalist Professor, George Reisman, has the antidote, and has been kind enough to send me a complimentary copy of his essay “Fundamental Insights into the Benevolent Nature of Capitalism.” It is available to the general public for 99¢ as a Kindle Book on Amazon.com.

An excerpt:

How Economic Inequality Is Essential for Successful Economic Competition by the Less Able

By George Reisman, Ph.D.

“As von Mises has … shown, with his development of Ricardo’s law of comparative advantage into the law of association, there is room for all in the competition of capitalism. Even those who are less capable than others in every respect have a place. In fact, in large measure, competition under capitalism, so far from being a matter of conflict among human beings, is a process of organizing that one great system of social cooperation known as the division of labor. It decides at what point in this all-embracing system of social cooperation each individual will make his specific contribution—who, for example, and for how long, will be a captain of industry, and who will be a janitor, and who will fill all the positions in between.

In this competition, each individual, however limited his abilities, is enabled to outcompete all others, however superior to him in their abilities they may be, for his special place. Quite literally, and as an everyday occurrence, those with abilities no greater than required to be a janitor are able to outcompete, hands down, without question, the world’s greatest productive geniuses—for the job of janitor. For example, Bill Gates might be so superior an individual that in addition to being able to revolutionize the software industry, he might be able to clean 5 times as many square feet of office space in the same time as any janitor now living, and do it better. But if Gates can earn $1 million an hour running Microsoft, and janitors can be found willing to work for, say, $10 an hour, their readiness to perform the job at one one-hundred thousandth of the hourly rate Gates would require, so far overcomes their lesser abilities that it is they who are the winners of this competition, without any question. For cleaning the amount of floor space that one of them can clean in an hour costs just $10, if one employs one of them, while having Gates clean that same amount of floor space costs $200,000, since the hour of his labor that would be required to clean 5 times as much floor space costs $1 million. To say the same thing slightly differently, employing 5 of them, who in combination clean as much floor space per hour as Gates, costs only $50, while employing Gates to do the same job costs $1 million.

It should go without saying that the same principle applies to all lesser degrees of productive superiority. Thus, for example, individuals capable of being janitors twice as efficient as the average janitor but also capable of doing work that the average janitor simply cannot do and that pays them more than twice as much per hour as the average janitor earns—these people will be outcompeted by the average janitor for the job of janitor. For it will be less expensive to employ two ordinary janitors than one twice-as-efficient janitor, who must be paid more than the two of them in combination, while their combined performance matches his.

There is an important implication in these examples for the subject of economic inequality. Namely, it is the ability of less capable people to work for wages sufficiently below those of more capable people that enables them to outcompete the more capable people and thereby to secure employment. It follows that all measures, such as minimum wage laws, that seek to force up the wages of less capable people operate to undercut their ability successfully to compete and thus to force them into unemployment, while depriving the rest of society of their services and forcing the movement of more capable workers into jobs that could have been filled by less capable workers.

In addition to the fact that under capitalism, there is room for even minimally capable people to be employed in the economic system, it is also the case that because productive geniuses are free to succeed in revolutionizing products and methods of production, those with minimal abilities are able to enjoy not only food, clothing, and shelter, but even such products as automobiles, television sets, and personal computers, products whose very existence they could probably never have even dreamed of on their own.”

Read the complete essay, “Fundamental Insights into the Benevolent Nature of Capitalism.”

UPDATED: CPUKE 2015 (Ann Coulter Joins Libertarians, Gets Off Warpath)

Conservatism, Constitution, Foreign Policy, libertarianism, Military, Neoconservatism, Political Philosophy, Regulation, Republicans

Well, well, like the 2014 Conservative Political Action Conference, CPUKE 2015 is lighter on the bimbo factor of yesteryear—CPUKE usually showcases retards like S. E. Cupp and assorted twits—but heavier with the weight of New Jersey Governor Chris Christie.

Senators Ted Cruz (R-TX) and Rand Paul (R-KY) are as close as it gets to constitutional conservatism. When quizzed by Fox News’ Sean Hannity about their positions on The Issues, both left drugs and marriage to the states. It would appear that the two are the only candidates standing for the Republican Party who reject centralized federal control over drugs and marriage. Libertarians want the state, local and national, out of marriage and drug use—the last must be legalized. So while the Cruz/Paul position is a compromise, it’s better than the rest. Cruz is far more intelligent and personable than Paul, so observing his intellectual virtuosity is more enjoyable.

Building up the largest military in the world, ours, it the focus of the megalomaniacal Donald Trump, who needs to go away for once and for all. “The business mogul is motivated by the sense that the nimbus of great power that surrounds the US is dissipating. It hasn’t occurred to him to search closer to home for the causes of America’s economic anemia—at Fanny, Freddie, and the Fed, for a start. Since Trump has no idea what’s potting, and is not eager to look in his own plate — he blames OPEC, China and Mexico for the burdens of doing business in the US.” More from “Sinophobia Trumps Common Sense”:

The Trump plan to reclaim global greatness and glory includes a strategy America has yet to try: the use of force, of course. Strutting around on the world stage, showing those Russians, Saudis, Chinese amd Mexicans who is boss: this may serve as a perfect panacea for the deficiencies in Trump’s persona, but is hardly a solution to US woes, at home or abroad.

Sadly, most other Republicans will echo these themes and the mob will cheer them. The WSJ summed up the overall lukewarm reaction to a libertarian foreign policy:

Many among [Paul followers] seemed receptive to his more restrained view of the use of military might, but the audience throughout the conference has responded enthusiastically to hawkish messages from the podium. Some of the best-received applause lines throughout the conference have been bellicose language and criticism of Mr. Obama’s foreign policy.

Mr. Paul linked his call for foreign policy limits to the kind of anti-government rhetoric that is popular with conservatives.

“We should not succumb to the notion that a government inept at home will somehow become successful abroad, that a government that is unable to deliver the mail will somehow be able to build nations’ abroad,” he said.

Later.

UPDATE I (2/28): It doesn’t take much to obliterate the lessons of history and political philosophy. CPUKE followers are on the warpath. From the Facebook thread:

Craig Smith: Many things to comment on here, and variously agree/disagree with. That event could have been much better orchestrated. But your comments which belittle the clamor for a militarily-revitalized are puzzling, especially against the backdrop of both an ever-increasingly dangerous world and Obama’s gutting, emasculating, and purging of the American military. I know that you are aware of all of this as well as anyone. I don’t have exactly the same opinion of all the parties that you criticize here. But I am wondering if you blurred the distinction of criticizing these individuals as individuals with the policy or policies they advocate.
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Ilana Mercer: Come again, Craig Smith!!!! I was under the impression you were aware that this was a libertarian Timeline of a libertarian writer. You appear to have strong, simmering neoconservative leanings. Time to start reading the good stuff again, Craig Smith…See More
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Craig Smith: I never forget that you are a strict libertarian. I like the novelty, but not all strict libertarianism seems viable to me. Nor, in the context even of all your works, does all of it always seem internally consistent. In any case, I urge an inventory-taking on what I brought up above.

Ilana Mercer: Craig Smith, you urge that I change on the basis of nothing but your drinking of the CPUKE Kool-Aid. I urge that you do the reading over the next few days of stuff that is as predictive as it was when first written. Why must I change when all I have predicted has panned out? All my predictions and analyses since 2002 have stood the test of time, so why must I change my philosophy? Here’s a better idea: do the reading. In “PUNDITS, HEAL THYSELVES!” (2004) I give some analogies to the advice of the pundits you urge me to follow. Some good lines.

UPDATE II: Ann Coulter Joins Libertarians, Gets Off Warpath. Doff of the hat to Kerry Crowel for the alert. He writes:

Have you read Ann Coulter’s latest column? … I think she’s been reading from the Mercer backlog. Especially the bit about “politicians obsessed with cleaning up the rest of the world.”

Don’t Be Conned By Con-servatives & Their ‘Ism’ Talk

Conservatism, Feminism, Free Speech, Gender, Individualism Vs. Collectivism, Media, Paleolibertarianism, Political Correctness, Political Philosophy, Sex

No different to liberals, mainstream conservatives are a party of isms, not individualism. Like liberals, conservatives diligently examine controversial speech for signs of the prohibited “isms”: sexism, racism, ageism, etc. Were they devoted to the principles of freedom; conservatives would refuse to even debate the legitimacy of impugning a man’s character, or expunging him from polite company, for the words that roll off his tongue.

Yet any debate these characters conduct on speech is never a principled debate about debate. Self-styled, mainstream conservatives seldom recuse themselves from the act of policing speech. Rather, they join in dignifying the media circle jerk.

James Rosen is best known for having been the victim of the head of Barack Obama’s Justice Department, Attorney General Eric Holder. For doing his job as a reporter, this Fox News Channel reporter was framed by the same department for the crime of conspiracy to leak classified materials.

Now, from being a credible reporter at Fox News, Rosen has gone on to reinvent himself as a sometime commentator.

State Department spokeswoman Jen Psaki and her deputy, Marie Barf, are studiously dumb chicks. Bill O’Relly was quite diplomatic when he said about the first that she was “way out of her depth” and lacked the “the gravitas for that job.”

Rosen could not let that stand. Via Mediate:

On Fox News yesterday, reporter James Rosen defended State Department spokeswomen Jen Psaki and Marie Harf from what he deemed vicious attacks that would never be directed their way if they were men. Harf in particular has gotten lots of conservative ridicule (to put it mildly) over her comments last week that 1) the U.S. can’t just kill its way out of war with ISIS; and 2) factors like job opportunity should be considered when examining the root causes of terrorism.

Rosen said, “It won’t please my social media followers to hear me say it, but I’ve been dismayed by the treatment of Marie and Jen on Twitter and other social media.” And not only are they mocked online, he said, but it’s done “in intimately person [sic] ways that I think bespeak a certain amount of sexism.”

Rosen went on to call Tweedledum and Tweedledumber very accomplished women.

American Thinker is insufficiently scathing about the quality of Tweedledum and Tweedledumber’s accomplishments—the two embody everything that is repugnant about womanhood in America—but it’ll do:

… Marie Harf sounded like a cheesed-off sixteen-year-old the morning after the big party when she dissed O’Reilly for saying, “…that woman [Jen Psaki] looks way out of her depth.”

For teenage girls the clique is of utmost importance. When they go all panties in a wad it’s often for their BFFs. Harf don’t stand on her jays, she stands behind her blud, Psaki. Harf not only lacks gravitas, she appears to lack conscience to grasp the international purpose and life-and-death seriousness of her job, that people live or are murdered on the turn of her flippant, self-referential phraseology. Stop the world! O’Reilly called my BFF “that woman.” It is hideous that she wasted one second in these desperate times ranting about imaginary sexism. Her bosses want Harf to spout domestic sex politics. And after all, that is the only item on her resume.

Harf is indeed hideous to behold.

Jeremy Bentham: Very Bad For Liberty, Indeed

Individualism Vs. Collectivism, Law, libertarianism, Natural Law, Political Philosophy, The State

The following columns make derisive mention of utilitarian philosopher Jeremy Bentham. The columnist (guilty) assumed (guilty again) that her readers, like many good libertarians (namely, natural-rights libertarians), would identify Bentham’s name as a synonym for statism and collectivism, to distinguish from liberty and individualism.

Libertarian legal scholar Randy Barnett, I recall, particularly enjoyed this from “A Romp Down Memory Lane With Justice Roberts” (7/6/2012):

“Why would George Bush care whether a judicial nominee can tell Blackstone from Bentham, when he can’t?”

“More of a Benthamite bureaucrat than a truth seeker” is from “PATRICIDE AND PROSECUTORIAL MISCONDUCT” (September 11, 2002).

Remember Reno!” (9/8/2006) equated Benthamism with legal excesses, whereby the law, “intended as a bulwark against government abuses,” had become “an implement of government, to be utilized by all-knowing rulers for the ‘greater good’—the founders’ Blackstonian view of the law” having “been supplanted by a Benthamism that encourages ambitious prosecutors to discard a defendant’s rights.”

“‘Mad Dog’ Sneddon Vs. Michael Jackson” (7/5/2005) mentions once again the Benthamite notion of “the law as an implement of government, to be utilized by all-knowing rulers for the ‘greater good.’”

The Library of Economics and Liberty expounds a little more about Bentham the utilitarian, whose “publications were few,” and whose foundational belief was “that all social actions should be evaluated by the axiom, ‘It is the greatest happiness of the greatest number that is the measure of right and wrong.’”

In a word, utilitarianism, and by extension, statism and collectivism.

Counter to Adam Smith’s vision of “natural rights,” Bentham believed that there were no natural rights to be interfered with.

Trained in law, Bentham never practiced, choosing instead to focus on judicial and legal reforms. His reform plans went beyond rewriting legislative acts to include detailed administrative plans to implement his proposals. In his plan for prisons, workhouses, and other institutions, Bentham devised compensation schemes, building designs, worker timetables, and even new accounting systems. A guiding principle of Bentham’s schemes was that incentives should be designed “to make it each man’s interest to observe on every occasion that conduct which it is his duty to observe.” Interestingly, Bentham’s thinking led him to the conclusion, which he shared with Smith, that professors should not be salaried.

In his early years Bentham professed a free-market approach. He argued, for example, that interest rates should be free from government control (see Defence of Usury). By the end of his life he had shifted to a more interventionist stance. He predated Keynes in his advocacy of expansionist monetary policies to achieve full employment and advocated a range of interventions, including the minimum wage and guaranteed employment.

Jeremy Bentham was a thoroughbred statist; the quintessential bureaucrat and social engineer, who devised ways to tinker in oder to optimize the individual pawn’s common-good conduct.