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Concerning free-markets and Darwinian-style evolution

A common free-market/Libertarian argument goes something like this:
“The success of Darwinian-style evolution provides good reason to trust that an unregulated free market will similarly lead our economy and society to ever greater prosperity. We must allow an unfettered “invisible hand of the market” to guide us.”

For those who make that argument, here’s something to consider:

1) The “invisible hand of the market”, like Darwinian-style evolution, is blind to the future. It’s not forward looking. It wont take two steps backward in order to find a better path. It’s chosen path may well lead to a dead end.

2) To the extent that the “invisible hand of the market” is like Darwinian-style evolution, it is extremely inefficient. It uses a trial and error approach to design. The vast, vast majority of designs produced by evolution are shotty. Nature has discovered many non-obvious solutions to problems, but the number of crudely flawed designs are far greater.

3)  The “invisible hand of the market”, like Darwinian-style evolution, is indifferent to the happiness and suffering of its constituent parts (e.g. genes,  people, etc). Similarly it doesn’t care about justice or liberty

Just the opposite of supporting the Libertarian argument, the similarities between the “invisible hand of the market” and Darwinian-style evolution provide us every reason to restrict its use. It does not appear to be in our best interests to allow the “invisible hand of the market” to guide us. Use it, sure, like we might use a horse to pull a cart, but we should not allow it to steer the cart. Without some intelligent guidance to navigate, the market’s “invisible hand” is likely to lead us into a dead end, if not over a cliff.

In my opinion, we need to decide where we want to go as a society, and then work to design a system that will guide the “invisible hand of the market” to take us there without sacrificing the happiness and liberty of the living along the way.

Concerning the collapse of the housing market in the U.S.:
Shermer’s characterization of why the housing market collapse should not be any of his (or our) concern in misleadingly selective. I don’t know of anyone arguing the point that we should be especially concerned with bailing out housing speculators who bought three and four homes in an effort to make a large ROI, but who are now suffering a loss. The primary concern being expressed is for those people who need to buy a house to live in. Housing is not a luxury item. Housing is a living necessity.

This housing crash and mortgage crisis problem is devastating millions of people who had little or no desire to enter into a high risk housing purchase; most people buying homes just want a decent place to live and are now victims of this critical failure in the housing market (brought about by deregulated financial markets), for example:
Just three years ago my friend got married, had a child, and bought his first home in the Detroit/Ann Arbor area.  He’s a fiscally conservative guy and he bought a house with a 30 year fixed mortgage that was both well within his ability to make payments. It was also among the cheapest houses in his neighborhood. This year he lost his job and wants to move out of state to get a good job elsewhere ... BUT…  he now owes $50,000 more on his house than its estimated worth. So, he can’t move and he can’t get a mortgage on another house. He’s stuck. There are millions of people stuck in similar situations across the U.S.

So, why shouldn’t we re-examine the design of our housing and mortgage markets and make appropriate adjustments to balance the costs, benefits, and risks of these market systems? No doubt, there are many who in a panic are proposing new regulations that would be bad, and such proposals should be rejected, but the fact that there exists bad regulation proposals doesn’t mean that the very idea of regulations is bad. There is good design and bad design, of course.

Concerning Hurricane Katrina and the failed government response
Shermer argues that services provided by government institutions are not as effective/efficient/reliable as those provided by “private” institutions. He sites the American government’s response to Hurricane Katrina as an example to support his case, but he fails to be able to fit this single example into a pattern that would support a real argument to support his claim.  Yes, the poorly designed and run Bush Administration emergency response program was a failure. That single sample can’t be reasonably used to say much if anything about the ability of government-based institutions to effectively manage responses to large scale emergencies, in general or in theory.  One sample does not support an pattern. The Ford Edsel, for example,  was a famously mis-marketed automobile, and yet this failure does not in any way suggest that using “focus group” in marketing and product design is a bad approach in theory - in fact, despite that initial failure, “focus groups” are proven to work. 

If Shermer wants to make an argument that supports his position about the inherent inferiority of government-funded institutions,  then for starters, he needs to demonstrate a pattern of examples and compare those to the performance of “private” institutions such as: General Motors, General Electric, or the Catholic Church. But more importantly, to prove his case, he needs to give examples of the non-correctable government structures that prevent government-run institution from providing services as effectively and/or efficiently as General Motors,  General Electric, or the Catholic Church.

Dr. Shermer’s ideas on economic psychology and the evolutionary roots of human behavior are interesting, but on the issue of private vs. government sponsored aid efforts, I think he is wrong.  Ground zero for Katrina was right in my backyard, and I have been working in the recovery effort since two days after the storm.  Dr. Shermer states in this podcast that FEMA was totally inept and that the private, faith-based relief agencies did a wonderful job.  This is a perception that the media has reinforced.  It is wrong. We seem to have an ingrained tendency to criticize government but give faith a pass in this disaster.  I find this odd in a skeptical community. The governmental response to the disaster was indeed inept in many ways, and the faith-based groups have done many good things, but the government’s response was, from my point of view, and I could back this up in a longer forum, inept because of the people put in charge of federal disaster relief since 2001, not because government could not in theory do a good job in this type of situation.  The faith-based groups, on the other hand, have made many mistakes that have cost people down here dearly.  I will give a few examples, briefly, leaving longer elaboration for another time:

In one small MS coastal town, Americorps, a government project, effectively ran the town for months after the storm, providing aid, running a disaster shelter, and responding to emergencies efficiently.  The faith-based groups that came in did a lot of good work, but were unorganized and slipshod in their priorities.  They ran their operations with little or no local knowledge, did not interact with each other or with other recovery agencies, and their aid was random-they helped many people who could have helped themselves easily while others in real need were left without help.  A lot of homes they repaired or rebuilt after the storm now have to be torn down and done over completely because they did not deal with mold issues, replacing wiring that had been submerged in salt water, did not consider new elevation requirements or, indeed, any building codes.  While one cannot help but be impressed by faith-based volunteers’ willingness to come here and help out,  they rotate in and out, have few skills beyond a willingness to help, all of which makes the logistics of working with them to rebuild homes and communities harder than it should be.  That is why, 2 1/2 years after the storm, we have made less progress than we should have.  I also dispute the claim that non-faith-based groups have not been a presence down here.  They have.  Hands On USA has been a big presence.  Americorps also.  Many of the faith-based groups have benefited from federal funding, and so they really can be considered quasi-governmental groups.  Some of there use of federal disaster relief funding is really questionable, and is under review in Congress.

While I would agree with Dr. Shermer that we are a volunteer-based social safety-net culture, and we volunteer more than European societies with government run programs to take care of the needy, ours is not necessarily the better model.  I don’t think you have to have lived through Katrina to realize this.  I noticed that Dr. Shermer kind of hedged his argument in the area of public health.  I would say, if he were pressed, he would have to back off on a lot of other issues, too.

mims carter

So it is repackaged social Darwinism not taking into account that technology has gotten more complicated over the last 100 years.

http://www.youtube.com/watch?v=zeEXDQNsJtU

We can’t make accounting mandatory in the schools so consumers might actually be more rational.  No we can’t have that.

Do economists have the brains to handle accounting?  And there is no Nobel Prize in economics.

psik

There are a host of assumptions about the magic of markets and the requisite need for a profit-motive that deserve more examination, especially by the overly zealous free-marketeers and libertarian-types.

A general claim made by those who bemoan government regulation of markets is that such government involvement in markets will necessarily make the markets less efficient. This is simply not the case. For example, the regulated market at a busy traffic intersection is more fair, more efficient, and safer than the free market of an intersection lacking regulation (like a traffic light).  In other words, not only does government involvement not necessarily lead to a less efficient market, in this case, government involvement increases market efficiency. Of course a poorly designed traffic-control system at an intersection could make that market less efficient, less fair, and less safe. As in all things, good design is essential.

Is economics a SCIENCE?

Isn’t observation of the phenomenon being studied standard operating procedure in SCIENCE?

So the entire economics profession has failed to observe the depreciation of automobiles and other durable consumer goods for the last 60 years.  GOOD TRICK! 

Does the market depend on most of the minds being dumb and the economics profession helps keep them that way?

psik

Nice interview.

  He also addresses the growing political and economic diversity when it comes to the skeptical and humanist movements.

One of the things which has bothered me about CFI-style “secular humanism” is its unskeptical support of left-wing causes, including an idealization of socialism.  Shermer argues for the value of a diversity of opinions and a reality-based approach.

So it is repackaged social Darwinism not taking into account that technology has gotten more complicated over the last 100 years.

http://www.youtube.com/watch?v=zeEXDQNsJtU

We can’t make accounting mandatory in the schools so consumers might actually be more rational.  No we can’t have that.

Do economists have the brains to handle accounting?  And there is no Nobel Prize in economics.

psik

Nice interview.

  He also addresses the growing political and economic diversity when it comes to the skeptical and humanist movements.

One of the things which has bothered me about CFI-style “secular humanism” is its unskeptical support of left-wing causes, including an idealization of socialism.  Shermer argues for the value of a diversity of opinions and a reality-based approach.

the problem is that market capitalism doesnt give diversity. in fact, market capitalism is deeply ideological. when margaret thatcher speaks in favor of market capitalism and says “there is no alternative” where is the diversity in that?

also, market capitalism is very anti-democratic. do people vote or participate directly in economic planning? hell no. its absurd to say that what is desirable are two contradictions where one exploits and stiffles the other.

choices and commodities are homogenized to meet the needs of profit, not fulfilling human needs or wants.

markets also divide people rather than bring them together. they pit people together.

im not saying we shouldnt be skeptical of left-wing causes, cause we most certainly should be and we should also be realistic about capitalism.

in 2002 the World Bank reported that Africa was a prime place to invest in because returns were high. It doesnt take much inspection to understand why. If the World Bank and the IMF gives aid with purse strings attached that say the must “liberalize” their economy by taking down trade barriers, labor protections, tarrifs and so on, and open them up to 100% foreign investment where multinationals have vastly more resources than indigenous businesses, farmers, etc then the domestic effects are what is so painfully obvious: deepened poverty while wealth is being extracted out and sent to foreign banks (ie high returns).

Argentina was considered a poster child for IMF policies and market capitalism in general. Look what happened. They went bankrupt and only overcame bankruptcy by dramatically undermining IMF policies.

The point here is that economies are about and involve more than just wealth and resources. I am talking about what economists call “externalities”: people, the enviornment. Now we can sidetrack into why people and the enviornment are considered externalities and not wealth and leizure but i think thats needless.

We have got to take into consideration the effects of economies on people, especially the poorest among us.  Those who are more adversley impacted by economic policies. Those at disadvantages and have less opportunities. We have got to take into consideration biodiversity as well.

Now as far people and the enviornment go I strongly disagree that market systems or capitalism in general are compatible with humanity or ecosystems. We have to many examples to draw from to see this.

We are a social species. We thrive on teamwork and cooperation. The basis of our existence centers around our social relations. There are reasons why anti-social and other social pathologies are looked at the way they do. I doubt many people on here, if any, will say they feel miserable when they act altruistically or do something nice for others. Likewise, I doubt many of us prefer to do things alone as opposed to cooperation (Bertrand Russell was correct when he said “the only thing that will redeem mankind is cooperation”).

So its a relatively simple matter of looking at what forms of social relations capitalism and markets produce and whether they are desirable. Is it desirable to be divided between buyers and sellers, haves and have nots; is it desirable to have our lives reduced to commodities? thatcher is wrong. There are alternatives. We can create new economic, social and political institutions by reanalyzing our social relations and modifying them or creating entirely new ones.

For example, fifty years ago most households were likely to be very nuclear and paternalistic. The man was the “man of the house.” He had undeserved authority simply based of his gender. This no longer flies for many. These relations have and are being challenged and more equal, cooperative relations are building up around them. In my relationship neither is dominant over the other. All sides are taken into consideration, amicable agreements are desired and to what extent one is effected more than the other than that more strongly determines final say. Market capitalism doesnt work this way, and dramatically so.

markets also divide people rather than bring them together.

Markets in fact are entirely about bringing people together. In order for a human market to exist, people must come together to negotiate the exchange of limited resources (food, ideas, limited automobile space on a roadway). The design of how those interactions take place however will dictate the nature (the fairness, the efficiency, and the risk) of those exchanges, and that’s an area that doesn’t get enough attention.

Capitalism, by it’s nature, tends to lead to a hording of resources. The powers that dominate the market, over time, tend to act to stifle it in order to maintain dominance.  Monopolization of resources and authority will eventually undermine the healthy function of any market system. Those that criticize the existence of government regulation fail to recognize that, in the absence of government regulation, regulations, in effect, will be imposed on the market by dominant-enough companies and/or their industry associations - such defacto-style regulations are even less likely to be benefitial to the overall market and even less likely to serve the interests of people in general.

markets also divide people rather than bring them together.

Markets in fact are entirely about bringing people together.

In theory according to Milton Friedman. But in reality things are very different. Look at Sub-Saharan Africa for details. It is no coincidence that the area where the highest returns are possible is also the most impoverished. In a much less severe example look at how Nintendo dominated the market in video games in the 1980s and how that kept Sega which had better games and more advanced console from entering for more than a decade.

But markets are about buyers and sellers. Each are out for themselves because the system is designed that way. The buyer is not lly thinking about the seller and vice versa. I personally think we should look at ways of removing markets and bringing producers and consumers together to particpate in managing their economic institutions

In order for a human market to exist, people must come together to negotiate the exchange of limited resources (food, ideas, limited automobile space on a roadway). The design of how those interactions take place however will dictate the nature (the fairness, the efficiency, and the risk) of those exchanges, and that’s an area that doesn’t get enough attention.

But why should they exist? Why do we need markets to negotiate and exchange? Can we not imagine alternatives and work to put them in place?

Capitalism, by it’s nature, tends to lead to a hording of resources. The powers that dominate the market, over time, tend to act to stifle it in order to maintain dominance.  Monopolization of resources and authority will eventually undermine the healthy function of any market system. Those that criticize the existence of government regulation fail to recognize that, in the absence of government regulation, regulations, in effect, will be imposed on the market by dominant-enough companies and/or their industry associations - such defacto-style regulations are even less likely to be benefitial to the overall market and even less likely to serve the interests of people in general.

Think about that and go back to my questions above. If something by its “nature” (there is nothing natural about economic institutions) can only be benign by constraint then why have it to begin with?

regulations, in effect, will be imposed on the market by dominant-enough companies and/or their industry associations

Any regulations business imposes on itself seeks to benefit the businesses that can impose the regulations, not the consumer.

Monopolization of resources and authority will eventually undermine the healthy function of any market system.

A mantra of economists, but history has shown it to be entirely false.  Not only have monopolies operated perfectly well (and very profitably) for long stretches of time, but industries tend to band together to produce an illusion of competition while in fact engaging in a form of central planning.  Also, there are areas of economics where competition is just plain stupid - should you have competing municipal water supplies?  Competing police departments?

All this free-market, libertarian, neo-liberal economics stems from a belief that people are naturally greedy liars, and seeks to put in place systems that guarantee that people will have to be ever more greedy liars in order to compete within that greed and lie based system.

markets also divide people rather than bring them together.

Markets in fact are entirely about bringing people together.

In theory according to Milton Friedman.

Not in theory according to Milton Friedman, but by definition according to how we use the term “market”. It is impossible for there to be an exchange of anything without a coming together and exchange of different resources, and that coming together and exchange of resources is what we call a “market”.
. .

But markets are about buyers and sellers. Each are out for themselves because the system is designed that way. The buyer is not really thinking about the seller and vice versa.

No, markets are about the exchange of resources, nothing more. Democracy, for example, is a market where your vote is used in a bid to elect a government official or pass a legislation. And the fairness, efficiency, and effectiveness of the democratic market place is dependent on the design of that market system. Democracy, like any market, does not by provide immunity against corruption, ineptitude, and exploitation—it needs to be designed and executed right.
. .

I personally think we should look at ways of removing markets and bringing producers and consumers together to particpate in managing their economic institutions. [...] why should [markets] exist? Why do we need markets to negotiate and exchange? Can we not imagine alternatives and work to put them in place?

I’m open to hearing about alternative ways of deciding how resources should be distributed. But markets, if they are properly regulated, seem like the fairest and most democratic way to me.
. .

Think about that and go back to my questions above. If something by its “nature” (there is nothing natural about economic institutions) can only be benign by constraint then why have it to begin with?

Yes, it’s part of the natural tendency of the Capitalistic market system to produce monopolies, so in order to correct for that tendency that system needs to be regulated. This is no different than the approach I would take to my garden. My garden, by its nature, is going to get overrun by weeds ... that fact doesn’t mean I scrap the idea of having a garden, it simply means that I’m going to have to do regular gardening.

regulations, in effect, will be imposed on the market by dominant-enough companies and/or their industry associations

Any regulations business imposes on itself seeks to benefit the businesses that can impose the regulations, not the consumer.

That was my point. A dominant industry association, will regulate the marketplace in their own interests and against the interests of potential competitors and consumers.

An “un-regulated” market is a transitory thing, eventually,  someone is going to dominate a market and impose their will: that someone is either going to be the government, or it’s going to be a dominant corporation or industry association.  In a government regulated market, hopefully you get an open set of rules and regulations that everyone understands and that are made and designed in the interest of promoting a healthy society. Left to themselves in a non-government regulated market, a sufficiently dominant corporation and/or industry association will impose it’s defacto-“regulations”. These regulations will more likely suit the limited interests of the corporation itself by creating barriers to competition and maximizing the price for their products (necessarily at the expense of the consumer). Most frequently, the industry will spread the costs associated with their product across the society as a whole (e.g. waste products, pollution, deforestation, etc), and benefit unfairly as a result.

I got my podcast on economics.  I had made a post in the forum calling for a podcast on economics.  I’m happy now!  I was also interested to find out that Michael Shermer was economically conservative/libertarian.  I was beginning to think that most atheists or skeptics were not.

I think most skeptics are not libertarians because libertarianism makes no sense.

Listening to this again, I was surprised (and apalled) as Shermer’s comments on FEMA as opposed to religious groups providing aid.  That a government agency did a bad job is evidence that it was run by incompetents - like Brownie, and his boss, George - not that government-run organizations are inherently incompetent.  He seems to have bought the right-wing, neo-con, Republican line on small government - which is exactly what corporatios want, so that they can push government around as hey see fit.  If FEMA had gotten the attention it deserved, and had been run by people who cared the people they were supposed to help, rather than frat-boy political appointees, then FEMA would have been in a position to respond more efficiently.  As for church groups, let me know the next time a church group reestablishes telecommunications infrastructure, or comes up with a mass evacuation plan for city.

What is this mysterious property that makes anything connected to “government” turn inefficient?  What is this “invisible hand”—and why would someone who would normally debunk something with as much ontological grounding as pyramid power or leprechauns take these mysterious forces so seriously?  This is the kind of distortion that you get when you reduce all human striving to: money.

“Mind of the market” indeed - even the title is a contradiction.  A hundred years of sociology tells us that when people assemble in groups, of whatever kind, even not physically contiguous, you get irrational behaviour if you’re lucky, and mass violence unto genocide if you aren’t.  Free market capitalists are quick to condemn “too much” democracy as mob rule, but they feel fine leaving the economy to the mob; something good will come of the irrational choices of people in a market, but something bad will come of the irrational choices of people with meaningful political rights.

Also, I think there are two very different senses of “regulation” being used here.  There is a basic sense of applying rules to something, but two different purposes.  When the government regulates it tends to be out of a concern for justice, in the sense of fairness, equal opportunity, equal distribution of risks and benefits, protection of life and heath, protection of the physical environment and property, etc.  When business self-regulates it tends to begin in a rewriting of the rules for its own benefit, and ends with thick manuals full of acronyms and cancer clusters.

I think most skeptics are not libertarians because libertarianism makes no sense.

This curious line speaks for itself.

I think most skeptics are not libertarians because libertarianism makes no sense.

This curious line speaks for itself.

I asked a Libertarian about mandatory accounting in the schools.  He said he objected on the grounds that nothing should be mandatory.  I didn’t bother to ask if by that he meant school should not be mandatory.

psik

I think most skeptics are not libertarians because libertarianism makes no sense.

This curious line speaks for itself.

I asked a Libertarian about mandatory accounting in the schools.  He said he objected on the grounds that nothing should be mandatory.  I didn’t bother to ask if by that he meant school should not be mandatory.

psik

I knew an Ayn Rand fan with a similar view.  However, from the audio I would suggest Michael Schermer’s “libertarian” views are more modest and practical.  Certainly the Constitution and Bill of Rights delegated various powers to the different branches but also limited the scope of the government’s powers. 

When you say “mandatory accounting” do you mean the district has to maintain its books in a standard way like the other districts in the state? (that seems reasonable to me…).  Or that kids have to take an accounting class (less reasonable)

Or that kids have to take an accounting class (less reasonable)

That is what I mean.  Double entry accounting is 700 years old.  The entire idea that accounting is difficult is ridiculous.  The accounting books are always written like the person is trying to learn to become a professional accountant rather than learn accounting to manage their own money.  They don’t need to know about partnerships and corporations to do that. 

I have two accounting books that cost $100 and have over 1000 pages.  I have checked every page.  There isn’t a diagram of cash in either of them.  One doesn’t talk about depreciation until page 600 but has a business owner buying a $3000 computer on page 50.  If you bought a $3000 laptop computer you would lose $1500 in depreciation in 18 months.  So imagine buying it with a credit card and paying interest on the depreciation.

This is a good book about economics:

http://www.amazon.com/screwing-average-man-David-Hapgood/dp/B0006W84KK

psik

Or that kids have to take an accounting class (less reasonable)

That is what I mean.  Double entry accounting is 700 years old.  The entire idea that accounting is difficult is ridiculous.  The accounting books are always written like the person is trying to learn to become a professional accountant rather than learn accounting to manage their own money.  They don’t need to know about partnerships and corporations to do that. 

I have two accounting books that cost $100 and have over 1000 pages.  I have checked every page.  There isn’t a diagram of cash in either of them.  One doesn’t talk about depreciation until page 600 but has a business owner buying a $3000 computer on page 50.  If you bought a $3000 laptop computer you would lose $1500 in depreciation in 18 months.  So imagine buying it with a credit card and paying interest on the depreciation.

This is a good book about economics:

http://www.amazon.com/screwing-average-man-David-Hapgood/dp/B0006W84KK

psik

I’m surprised that a high school would require everyone to take accounting—I hadn’t come across an example of that in New York State.

I’m surprised that a high school would require everyone to take accounting—I hadn’t come across an example of that in New York State.

I never said any high school required it.  I am suggesting it should be required in all high schools.  How many credit cards get sent to college freshman each year?  That wasn’t happening when I went to college.

http://www.bsu.edu/news/article/0,1370,-1019-11714,00.html

psik

Nice interview.

  He also addresses the growing political and economic diversity when it comes to the skeptical and humanist movements.

One of the things which has bothered me about CFI-style “secular humanism” is its unskeptical support of left-wing causes, including an idealization of socialism.  Shermer argues for the value of a diversity of opinions and a reality-based approach.

Hey everyone, just joined up, been catching up on Point of Inquiry the last few months, listening on my iPod while riding the metro here in DC.  One thing I have noticed is that every now and then, they seem to really lean to the left.  After hearing Shermer’s interview, I thought “Finally, there is hope for us libertarian/objectivists” here.  I am surprised there are not MORE libertarians amongst the fellow atheist/agnostics on here.  Either way, it is a great show (the host is probably one of the best I have EVER heard), but the left-leaning stuff bothers me.  (I think it was the Susan Jacoby interview that irked me).

Anyhow, great show and hopefully, there are other libertarians and/or objectivists out there.

I believe it was Calvin Coolidge who said that the business of America was business. No. The business of business is business. The profit motive is clearly an important motive in business, especially for pushing forth new technology and innovation, getting products to the shelves.  But, who said that every aspect of our social structures should be treated like a for-profit enterprise? I don’t want my retirement, health or educational needs being treated on the same level as a cruise ship service. Basic needs and even employment itself are not components of capitalism. Look how the short-sightedness of corporate greed has led to the lack of future fuel development. America should have had a Marshall Plan for electric cars 20 years ago. This country has saddly lost the concept of the common good and the general welfare. Yes, general welfare, right there in the preamble! I look forward to a future America that is modeled after western Europe, not Ayn Rand. If the 20th century has proven anything, it’s that extremist politics don’t work. Extreme capitalism is just as crazy as Maoism.
    I find it sad that Mr. Shermer would not only promote a sinister philosophy like Libertarianism, but do so under the guise of science. Dawkins said that a society run along Darwinian politics would be a very unpleasant one indeed. Science is simply a description of unconscious, blind natural systems. Basing economics on Darwin makes as much sense as basing it on Newtonian physics. I’m afraid the Skeptic Society won’t be getting any more of my natural selection. POWER TO THE PEOPLE!

So it is repackaged social Darwinism not taking into account that technology has gotten more complicated over the last 100 years.
psik

That’s the exact thought I had when I listened to the Shermer ep when I was doing my household chores last weekend. He sounded exactly like those
classic Social Darwinists who tried (often with impressive rhetorical skill) to use the scientific truths of evolution to set up a social ethics where human
solidarity is non-existent and devil take the hindmost. He sounded like a man who started out with a political/social agenda, and then marshalled a set
of cherry-picked facts (and a good number of non-facts) all designed to buttress his agenda. That being said, the ep did make me think, which is what
I expect from PoI, so from that point of view, the ep was a success.

Nice interview.

  He also addresses the growing political and economic diversity when it comes to the skeptical and humanist movements.

One of the things which has bothered me about CFI-style “secular humanism” is its unskeptical support of left-wing causes, including an idealization of socialism.  Shermer argues for the value of a diversity of opinions and a reality-based approach.

Hey everyone, just joined up, been catching up on Point of Inquiry the last few months, listening on my iPod while riding the metro here in DC.  One thing I have noticed is that every now and then, they seem to really lean to the left.  After hearing Shermer’s interview, I thought “Finally, there is hope for us libertarian/objectivists” here.  I am surprised there are not MORE libertarians amongst the fellow atheist/agnostics on here.  Either way, it is a great show (the host is probably one of the best I have EVER heard), but the left-leaning stuff bothers me.  (I think it was the Susan Jacoby interview that irked me).

Anyhow, great show and hopefully, there are other libertarians and/or objectivists out there.

See, that’s the great thing about atheists/agnostics/skeptics: we are a much more intellectual diverse lot than the slack-jawed believers.  Me, I loved the Jacoby interview (and ran right out to buy her book, which I’m reading as we speak) and I was appalled by Shermer’s ideas and politics. Definitely stick around, you’ll find an exciting diversity of opinion here. The human diversity around here is as stimulating as the political/philosophical/cultural diversity, so jump in and have fun.

..... would not only promote a sinister philosophy like Libertarianism, but do so under the guise of science.

The concept of Libertarianism which I like is that people get to choose for themselves.  I think the first amendment and freedom of religion might be more consistent with libertarianism than with socialism.

He sounded like a man who started out with a political/social agenda, and then marshalled a set of cherry-picked facts (and a good number of non-facts) all designed to buttress his agenda. That being said, the ep did make me think, which is what I expect from PoI, so from that point of view, the ep was a success.

When someone makes me waste brain power analyzing BS so I have to shoot holes in it to figure out that it is BS they just piss me off.  That is what is wrong with this society.  You spend more time sorting out crap being thrown at you than you do making progress.

Double entry accounting is 700 years old.

http://www.ivcc.edu/steljes/GeneralPages/Links/accounting_history_in_a_nutshell.htm

So if grade school kids had been taught basics of accounting and then a year of accounting in high school followed by a year of economics, and that done since 1945, then what state would the American economy be in today?  Maybe we would not have all of these foreclosures because almost all Americans would have their homes payed for by now.  How desperate would Americans be for jobs if they didn’t have to pay rent or mortgages?

How tedious would accounting be with properly designed accounting software?  The way some of this stuff looks the computers make things more difficult.  I can understand why schools would like that.  I have two accounting books that cost $100 and have more than 1000 pages and not a single diagram of cash flow in either one. RIDICULOUS

http://www.bsu.edu/news/article/0,1370,-1019-11714,00.html

I believe we have a problem of people who think they are smart making knowledge difficult to acquire for other people in order to maintain their advantage.  They call that competition.

A funny example is Suze Orman.  I checked the indexes of 5 of her books and depreciation was not listed in any of them.  I have Sylvia Porters MONEY BOOK from 1975.  Depreciation is listed on 5 pages.  4 of those entries are about depreciation of automobiles.  But if you look up accounting in her book it just talks about getting a job as an accountant.  Now Porters book is more than 1000 pages.  I think she could have said quite a bit about accounting in 50 pages if she wanted to.

So why isn’t everybody that’s talking about economics saying how the economy might work differently if everyone understood accounting?  It wouldn’t be that the smart people want the dumb people to STAY DUMB, you suppose?

psik

The concept of Libertarianism which I like is that people get to choose for themselves.

This idea, that government is LESS OF A process of people choosing for themselves than that of an unregulated market system is one of the great myths of the “Libertarian” philosophy.

A large group of people who organize themselves in order to improve their community (i.e. a government) and charge all those who benefit from living and working in that community (i.e. levee taxes) is at least as much “a process of people choosing for themselves” as is the process of a tiny subset group of wealthy people buying-up retail space and housing in order to charge all those who benefit from living and conducting commerce in those spaces. 

In both cases, if you don’t like the township, or state, or country, or condo, or retail space, then you can (or should be allowed to)  move to another one.

Monopolization of power and lack of choice is potentially as much a problem in an unregulated market as it is potentially in a democratic government. Decentralization of powers (checks and balances and separation of powers)  is necessary in both cases in order to preserve the ideal of “a process of people choosing for themselves”.

The concept of Libertarianism which I like is that people get to choose for themselves.

This idea, that government is LESS OF A process of people choosing for themselves than that of an unregulated market system is one of the great myths of the “Libertarian” philosophy.

I agree that an unregulated market will allow a few people at the top of a few monopolies to make most of the important decisions instead of people choosing for themselves.  Even Shermer agreed that markets need to be regulated.  But what I don’t understand is how letting the government make those decisions is letting individual people choose for themselves.  If I have one vote in 100 million voters, that’s not having a say.  Even if I have one vote in 100 thousand, that still gives me little say mathematically speaking.  If the government service is forced upon everyone then individuals have no say.  If government is going to be involved in the economy it has to allow for people to choose not to use the government service or else individual people have no choice.  The best example of letting people choose for themselves is the open source and proprietary software market.  People are free to choose software that was produced by a monopoly or they can choose to buy software produced by a community of non-profit developers.  Both kinds of software are thriving.  Another example is how government runs the post office but people can also choose to use UPS or FedEx.  The libertarian principle that does make sense is letting people have choice.

I don’t think anybody is saying that the government should tell people exactly what to buy or sell. But, democratic government should step in when private business is not meeting the needs of employees, consumers or society in general. It’s like minimum wage. Companies pay people what they think they are worth and that’s just not good enough to meet their needs. Who the hell is going to step in to raise salaries but the government? I’m not saying that a surgeon should get paid the same as a janitor, but the janitor should be brought up to a certain level of sustenance. Do you really think that profit-motivated corporations are on the same playing field as individuals? He who has the gold rules, as the joke goes. Of course, there have been governments in the past who intervened to create injustice. Oscar Schindler made a lot of money off his Jewish slaves, no overhead. Of course, the fascists at least cared about some members of society. Libertarians care about nobody.

Libertarians care about nobody.

According to Wikipedia,  Libertarianism is a broad spectrum of political philosophies, each sharing the common overall priority of maximum limitation of government combined with optimum possible individual liberty

I actually don’t know that much about libertarianism and just this one link has a lot of detail.

In the United States, libertarianism is claimed to be the philosophy advocated by Thomas Jefferson and several of the Founding Fathers.[5] 

Libertarians strongly oppose government infringement of civil liberties such as restrictions on free [removed]e.g., speech, press, or religious belief or practice), prohibitions on voluntary association, or encroachments on persons or property. Some make an exception when the infringement is a result of due process to establish or punish criminal behaviour

If government is going to be involved in the economy it has to allow for people to choose not to use the government service or else individual people have no choice. But what I don’t understand is how letting the government make those decisions is letting individual people choose for themselves.  If I have one vote in 100 million voters, that’s not having a say.

Democratic nations throughout the world *DO* allow people to choose - at least as much so as a shopping-mall owner gives its retailers a choice. In both cases, if you don’t like the overall value you realize from the package of services that you pay for, then you can choose to move to another location. Individual people unhappy about the quality-of-life return they receive from the taxes they pay, can choose to move to another township, or state, or even country. Yes, it’s possible that the market is not providing you your ideal government product, but I face the same problem with retail space and cable service. 
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In both cases, you wont have enough leverage with your individual vote (1 in 300million at the federal level) nor with your individual consumer dollar (similarly a drop in the bucket). In both cases, it takes creativity and ingenuity and work to organize and design another option that the market will buy into whether that market be the market of voters seeking better government or the market of retailers seeking a better shopping-mall. 
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Here’s a personal experience that I’ll share:
Recently, my township decided that it would be a good idea to provide free wireless Internet access service to everyone everywhere in the downtown area of our city. What a great idea. This would be a great convenience personally, but overall, it would also attract a lot of people to our city and downtown area, it would promote business and enterprise, etc etc. ... but Charter Cable and other corporations that want/do make money selling such services for profit objected, and sued the city to prevent the act.  As a result, my quality of life has suffered. I am now all but forced to purchase my Internet service through Charter Cable as part of a package that includes cable television (a service which I don’t want, but have to pay for anyway ... no different than the tax based model of paying for government services that I may or may not <u>directly</u> benefit from).

The irony that my city is “incorporated” does not escape me.

I have a question with regard to what I believe is a common “libertarian” / “conservative” economic world view:

This world view seems to hold that the free-market economy (not necessarily 100% “free” but almost completely free of regulation) provides all people an equal opportunity to succeed, and so whatever wealth and power a private individual acquires in a life-time is necessarily fair and just; as such, the government should not be in the business of taking that money away or taxing this person or restricting the growth of this person’s enterprise—let the “invisible hand of the market” decide weather or not the enterprise should survive or fail. Right? 

Please, someone correct me if I’m wrong.

This world-view, as I see it,  is used as the basis for the political argument that there should be less government involvement in the economy and that taxes should be lower (whatever the tax rate is it seems, this political group will argue for still lower taxes).

So, here’s my problem with this world view: i
In much the same way that King George inherited his government power and authority, most of the world’s wealthiest people have begun their lives with great amounts of inherited wealth (and as such, economic power).  Isn’t it obvious that we do not start off with anything approaching equal opportunity due to the vast descrepencies of how we begin life economically? .. the economic discrepancy among people at the start of life is at least as great today as the political authority discrepancy that existed in England 1776.

And yet, it’s the economic “conservative”/“libertarian” more than any other political block that fights against the inheritance/estate tax (the “death tax”)  ...  Why is that? This tax, if any, should be the one tax I’d think that the economic-libertarian /economic-conservative should be in favor of. It would provide a more just moral basis for their economic world-view, wouldn’t it?

Obviously, I think, Libertarians agree that the government should step-in to protect civil and social liberty. But Liberty is more than simply having the right to choose, in order for liberty to be realized, you must also have the ABILITY to choose. THAT’S freedom.

Without economic independence, liberty can not be realized. If not the government, who will provide equal economic opportunity ? Who is going to ensure that every child born has access to health-care, education, and security on par with the education, health-care, and security of any other child?

This issue seems to me as basic an issue as “one person one vote”.

Recently, my township decided that it would be a good idea to provide free wireless Internet access service to everyone everywhere in the downtown area of our city. What a great idea. This would be a great convenience personally, but overall, it would also attract a lot of people to our city and downtown area, it would promote business and enterprise, etc etc. ... but Charter Cable and other corporations that want/do make money selling such services for profit objected, and sued the city to prevent the act.  As a result, my quality of life has suffered. I am now all but forced to purchase my Internet service through Charter Cable as part of a package that includes cable television (a service which I don’t want, but have to pay for anyway ... no different than the tax based model of paying for government services that I may or may not <u>directly</u> benefit from).

Don’t know full story.

Here is example in Cincinatti where Time Warner “seems” to be working with local groups to bring free wireless into the downtown.
I don’t know if this ever actually came off…
http://www.broadbandinfo.com/news/time-warner-adopt-hotspot.html

If you don’t like the overall value you realize from the package of services that you pay for, then you can choose to move to another location. Individual people unhappy about the quality-of-life return they receive from the taxes they pay, can choose to move to another township, or state, or even country.

Forcing people to move in order to have choice seems extreme to me.  The person’s job may be in that town and telecommuting may not be an option.  What if the person has family they need to take care of? 

The solution to retail space is to own your own building.  (Easier said than done, right?) You’ll pay less to own your own building than paying rent in the long run.  Otherwise you face the same problems as someone who rents an apartment instead of owning their own house. 

About Charter Cable, everyone in the tech industry knows how monopolistic the carrier companies are.  They game the system by using the government to serve themselves.  Corporations like free markets when they’re on the way up, but when they have dominance they loose their capitalist free market ideology in favor of monopolies.  The laws need to be changed in your town.  In my town, the city power company is providing Internet service over the power lines.  This is the way to go, since the city is the only one big enough to compete with Comcast and AT&T;.  The consumer still has the choice to purchase services from a large private corporation or from a government service.

This world view seems to hold that the free-market economy (not necessarily 100% “free” but almost completely free of regulation) provides all people an equal opportunity to succeed, and so whatever wealth and power a private individual acquires in a life-time is necessarily fair and just; as such, the government should not be in the business of taking that money away or taxing this person or restricting the growth of this person’s enterprise—let the “invisible hand of the market” decide weather or not the enterprise should survive or fail. Right? 

I think you make a good point, Riley.  Many of the capitalist ideas such as freedom to choose, a minimum of government interference, and freedom to keep the profit you have earned are good principles.  But, any good principle taken to an extreme with no checks and balances becomes destructive, eventually.  Even with freedom of speech, people are not allowed to yell “Fire” in a movie theater.  The original justification for allowing people to keep profit was the argument that the person deserved to keep the profit because the person expended capital, acquired knowledge, did work, and took risks to make the profit.  Someone who inherits wealth has done none of these things.  How long would libertarians allow for wealth to be transfered from generation to generation?  I don’t believe that a completely unregulated system would make sense or be fair.  A system of regulations that provides a level playing field that would provide for the common good would be best.  However, the danger is that more regulations may not favor the common good since corporations can lobby to get regulations that favor themselves.  The Charter Cable story was a good example of that.  Government regulations have to checked just like everything else.

Forcing people to move in order to have choice seems extreme to me.  The person’s job may be in that town and telecommuting may not be an option.  What if the person has family they need to take care of? 

People are not being forced (at least not any more so than they are if they want to get out of an undesirable rental or mortgage agreement, for instance). If the costs/benefits associated with moving are greater that the costs/benefits of staying, then you move, otherwise you don’t. We can assume in a free society that people choose to start a family and get a job in the community that they want to live in, and buyer beware.

Also, don’t kid yourself into believing that people are the owners of the mortgaged home that they live in. The mortgage company is the owner of those homes. For instance, I recently had flood damage to my house, and ALL the insurance payments to repair that damage went to my mortgage company ... not to me.  I had to do all the work in arranging for the repairs and for the design of those repairs, etc, but my mortgage company had all the final say as to whether or not they would release the money to me in order to exact those repairs. It wasn’t until they had inspected all the improvements and repairs that my mortgage company released the money to re-imburse me for my expenses.

Also, how do you think most people (myself included) managed to get a mortgage in the first place? Our home mortgages are subsidized/insured by the American government, otherwise most people couldn’t even get approved to “rent-to-own” their house in the first place. This I think is a good example of a positive government involvement in the economy.

The solution to retail space is to own your own building.  (Easier said than done, right?) You’ll pay less to own your own building than paying rent in the long run.  Otherwise you face the same problems as someone who rents an apartment instead of owning their own house. 

Yes, but this theoretical freedom to choose, in reality is not available to most people. Have you ever tried to buy a piece of prime real-estate land in a major downtown area? It requires a rarefied amount of wealth. A similar amount of wealth could buy you a small island country ... which gets back to my point: If you don’t like the lease/government that you are buying into, choose another one. You have that freedom —at least as much so as you do in a non-government involved market.

About Charter Cable, everyone in the tech industry knows how monopolistic the carrier companies are.  They game the system by using the government to serve themselves.

  Yes, and in order to game the system, they make a public appeal to the anti-government, anti-regulation, pro-free-market, “libertarian/conservative” political base. Don’t they???? This is my point of criticism about the “libertarian/conservative” political philosophy.

The dominant industry players use the “libertarian/conservative” rhetoric in order to get their preferred people into elected office where they then use government to serve their narrow personal corporate interests at the expense the general welfare (see for example,  the Bush Administration and the Tom DeLay run congress). Pollution, public safety, product life-cycle, and the use of publicly owned natural resources in general (like air, electro-magnetic spectrum, and water) are some of the ways in which a large industry can pawn-off/distribute a cost of doing business onto the general public.

In my town, the city power company is providing Internet service over the power lines.  This is the way to go, since the city is the only one big enough to compete with Comcast and AT&T;.  The consumer still has the choice to purchase services from a large private corporation or from a government service.

Well, that’s OK, but what I want is not just a competing for-pay service that I have to connect to from my home, but a “free” wireless service that anyone can connect to from anywhere inside the city, paid for with my taxes.

I want visitors to my community to be able to jack-in without a care about passwords and such. This type of service would be a boon to my community economy I think. It would also save a lot of money in aggregate because such a system that doesn’t have all the administrative overhead costs associated with billing and collection and gate-keeping. Furthermore, it would save our community money because we would own the system, instead of be renting it. Charter charges based on how much value the Internet is worth to its customers, not how much it costs to actually build and run such a system, so as a result we are paying a premium when we could be paying cost, minus the overhead of billing administration.

Yes, we need to change the laws or appoint different judges, which again is back to my main point:  the barrier preventing the passage of these new laws is the activism of those pesky Libertarians! Why should I and my neighbors not be allowed to unite our resources to BUY our Internet service infrastructure, rather than be forced to rent it from Comcast?

Providing everyone with Internet access is also a “liberty” issue I think.  I believe that in order to have an equal opportunity to succeed, kids need equal access to the Internet. People (especially kids) of all economic backgrounds need to have equal access to this service . This type of thing it too important to be left to the whims of a few for-profit media companies that will likely start using its control of the portal to gate my access with self-serving advertising.

  I don’t believe that a completely unregulated system would make sense or be fair.  A system of regulations that provides a level playing field that would provide for the common good would be best.  However, the danger is that more regulations may not favor the common good since corporations can lobby to get regulations that favor themselves.  The Charter Cable story was a good example of that.  Government regulations have to checked just like everything else.

It sounds like we are in close philosophical agreement on this. Much more practical than ideological.

Another thing that irks me is when the anti-regulation pundits refer to “regulation” in terms of its amount: as if regulations were a commodity, all the same. Regulation is a technology; regulations are as varied and context sensitive as any other tool.  Regulation as an issue needs to be debated as a matter of design, not as a matter of quantity.

Furthermore, even those reasonable people who grant that regulation is necessary, irk me by making it sound as if regulation were a necessary evil, that it will necessarily make our markets less efficient, but OK, in order to safeguard against criminality or what-not, the burden of regulation must be borne. They couldn’t be more wrong-headed.

As in the case of a traffic intersection,  a well designed system of traffic regulation will make the market-place of cars vying for limited space on the road <u>not only</u> more fair and more safe,  but also more efficient.

All you libertarians out there, say it with me:
“Regulation is a technology. Regulation can and have been used to improve market efficiency.”

Now say it ten more times and find at least one other real life example of this being the case (examples of this are plentiful) and you will be cured of your dogma.

You’re welcome.

People are not being forced (at least not any more so than they are if they want to get out of an undesirable rental or mortgage agreement, for instance). If the costs/benefits associated with moving are greater that the costs/benefits of staying, then you move, otherwise you don’t. We can assume in a free society that people choose to start a family and get a job in the community that they want to live in, and buyer beware.

And what if the seller is a liar?  Too bad for the buyer?  What if the seler is a thug and puts a gun to your head, figuratively or literally?  What about economic arrangments that amount to coercion?  Too bad for the consumer?  What if the choice is between one slum tenement and another slum tenement?  What if your choices are limited by bigots who take your gender or race or religion or whatever else into account when setting a price - if they decide to sell at all?  What if a person is physically restricted in their choices because of a diability?  How do you guarantee the free society without “regulating”?

Sometimes there are only costs, and no benefits, conditioned by coercion and violence.  This is why the libertarian point of view is simplistic and immoral.  It is also most often a covert support of property rights over all other rights, so that libertarians are, in effect, doing PR work for the corporate point of view.

Regulations can and have been used to improve market efficiency.

Supposedly regulation-free markets are as regulated as government-regulated markets.  The question is who sets the regulations and how.  Libertarians want the regulations set by the person who is willing to sink the lowest in order to win.  A free market gave us the dominance of Micosoft and Windows, which are demonstrably inferior as a company and an operating system than the alternatives (not necessarily Apple, but any number of other companies and software options that Microsoft, absent of effective regulation of their practices, quashed).

A market is regulated by definition.  Who do you want regulating markets?

You can even dispense with the whole distorted concept of “regulation” - markets are not so much regulated as ordered.  No government could ever monitor and control all commerce, only provide the structures which tend to improve the chances of fairness in trade.  We will order markets in this way, with differing and competing ideas of what constitutes “fair”, and different ideas of how that fairness can be brought about.  I think it can be brought about by thought and reason and human action.  Libertarians believe in the market fairy, a.k.a. the hidden hand.  In the real world, the market fairy is a rationalization of theft, fraud, extortion, and all the other mechanisms of a “free” market.

If you want to see a real unregulated market in action, look at illegal drugs.  Since they are illegal, there are no government regulations at all, and I think we all know how that market regulates itself.

A system of regulations that provides a level playing field

The level playing field is a myth.  It does not exist, and it cannot exist.  The best we can hope for is some levelling of power, which includes a levelling of wealth.  That amounts to some kind of democracy, which libertarians seem to have no use for, and some kind of socialism, which libertarians actively hate.

find at least one other real life example

It’s too bad that in between tract by Hayek and Freedman students of economics aren’t provided with, say, The Jungle by Sinclair Lewis.  That’s a fine portrait of unregulated industry.

To be fair, I believe that the Libertarian view-point holds that the government cannot be kept isolated from the greed and corruption of powerful corporations. They would argue that government become the tool of the industries it would seek to regulate, and so by giving the government more than a bare minimum authority to regulate commerce (a bare minimum being defined as, for example, regulating against theft) you are in fact providing the means for an out-of-control corporate power, to gain even more power, and since government also has the additional authority to use military force, that’s particularly dangerous.

Personally, I think that the vast, vast majority of corporations are run by people with high moral character who want their company to be a responsible citizen. Unfortunately, the very nature of distributed plausibly deniable responsibility for the consequences of an action (see the Nazis, and related see the Milgram experiements) leads people to do irresponsible things when push comes to shove, and especially when there’s moral uncertainty about consequences of a company policy.

Also, I think that most corporations (i.e. the people that run them) would welcome clear and enforceable rules and regulations for industry, so long as everyone was made to follow them.

This was very disappointing for a PoI podcast—normally so excellent—as it was basically a political ideology masquerading as science. Free markets are a “natural” way for humans to interact? Really? Let’s not forget that in the Soviet Union, “science” declared Marxism the natural state of the human being.

I found DJ—again, normally so good—rather off key here. He made some ridiculous claims, such as there is no free market in Northern Europe. This will come as news to the brokers in the Stockholm Stock Exchange. I also found the zero-sum choice between free markets and “socialism” (here simplistically defined as pretty much everything else) nonsensical. There is, in fact, a perfectly reasonable and workable middle ground: social democracy. This is not socialism a la Cuba, but nor is it unfettered free market libertarianism either. It’s simply a free market bounded by rules (those dreaded “regulations”) that ensure fair practice and protect the public from the inevitable overreaching and excesses of private enterprise. It seems to work rather well in the EU or Canada. But so far to the right has thinking slouched in this country that the word “regulation” is now spat out between the teeth, as if it were synomous with “tyranny” or “statism.”

And let’s not forget that it was deregulation fanaticism that set up the conditions that led directly the S&L;debacle in the 1980s, the Enron and WorldCom fiascoes, and now the looming abyss of the subprime market collapse. What might we deduce from those facts, I wonder? That we need even more deregulation? Would it be “scientific” to argue that?

All in all, a disappointing PoI that, I hope, marks the last time we’ll hear attempts to claim scientific mandate for a particular political ideology.

it was basically a political ideology masquerading as science.

You’ve decided that your point of view is correct and it’s time for the discussion to stop.  Why stop the discussion?  This would be a great opportunity for you and people who share your belief to convince who knows how many people of your point of view.  Economics is too important an issue to not discuss.

Much more practical than ideological.

I like the difference you allude to between a pragmatist and an ideologue.  An ideologue would proclaim his/her principles and stick by them without paying a whole lot of attention to what is actually going on or how the principles are being abused (Ayn Rand, Rush Limbaugh).  A pragmatist would have his/her principles but would be mindful of the current situation before applying them.

And what if the seller is a liar?  Too bad for the buyer?

Who is the seller?  The corporation or the marketing person working for the corporation?

Mostly management only tells the marketing people what they need to know.  If there is some problem with the product or it is inferior to a competitor’s there is every chance the marketing people don’t know it.

psik

First, a self-correction: The Jungle is by Upton Sinclair, not Sinclair Lewis - the latter also wrote some good portraits of American life - Main Street, Babbitt, Elmer Gantry among others.

To be fair, I believe that the Libertarian view-point holds that the government cannot be kept isolated from the greed and corruption of powerful corporations. They would argue that government become the tool of the industries it would seek to regulate, and so by giving the government more than a bare minimum authority to regulate commerce (a bare minimum being defined as, for example, regulating against theft) you are in fact providing the means for an out-of-control corporate power, to gain even more power, and since government also has the additional authority to use military force, that’s particularly dangerous.

But that is a cop-out that throws the baby out with the bath water.

If there is no governmental, which is to say public, authority to prevent corporate domination, then what authority is there?  That is why libertarians are anti-democratic: they want to abandon the idea of public control, i.e., abandon the idea of rule by the people.

Personally, I think that the vast, vast majority of corporations are run by people with high moral character who want their company to be a responsible citizen.

I disagree.  The executive who chooses responsibility to society over responsibility to the bottom line is soon fired.  There is a kind of natural selection that leads to corporations being run by people who are either ignorant of the social or ethical issues involved, distort those issues to the benefit of their own consciences (if they have them), or simply do not care about those issues and only want their company and themselves to “succeed”.  People who do irresponsible things are, by definition, irresponsible people.

What might we deduce from those facts, I wonder? That we need even more deregulation? Would it be “scientific” to argue that?

It is a simple task to look at situations where deregulation has occurred and then see what happened afterwards.  In most cases, deregulation leads to economic disaster for the poor, economic suffering for the middle class, and the rich and corrupt getting richer.

There are very few examples of the opposite happening.

Who is the seller?  The corporation or the marketing person working for the corporation?

Or the advertising agency, or the television network, or whoever?  All of the above.  If you oen a TV station and you run an ad for Q-Ray bracelets, you are as much a fraud as the Q-Ray salesman, and the Q-Ray ad production team, and the Q-Ray manufacturers.

Marketing people, from what I can tell, outside of marketing techniques know nothing.  Ask one the time and he’ll try to sell you his watch.

it was basically a political ideology masquerading as science.

You’ve decided that your point of view is correct and it’s time for the discussion to stop.  Why stop the discussion?  This would be a great opportunity for you and people who share your belief to convince who knows how many people of your point of view.  Economics is too important an issue to not discuss.

In my view, economics is as much a science as gazing into a crystal ball is a science. There are as many economic opinions as there are economists to hold them.

As to the discussion, I don’t think it’s appropriate for this forum. Read this thread. It’s politics. It’s basically left vs. right. There are endless venues on the web for left and right to battle it out. PoI, in my humble view, ought not to be one of them. It risks losing its unique—and uniquely valuable—identity as a place where issues of rationalism and science are freely discussed. I don’t include politics in either of those categories and think it a bad idea for PoI to start down that road.

This, of course, is just my opinion.

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It is a simple task to look at situations where deregulation has occurred and then see what happened afterwards.  In most cases, deregulation leads to economic disaster for the poor, economic suffering for the middle class, and the rich and corrupt getting richer.

There are very few examples of the opposite happening.

Here is a good example of where scientific methods could clear up some of the “Crystal Ball” (Trajan117 quote)  aspects of economics.  Study real world examples of where the same culture and people are split up into two different economic systems.  One system is regulated and the other system is an unregulated, free market.  Maybe the unregulated free market would lead to most of the profit going to the rich, but at the same time maybe the regulated economy would be even worse for the poor.  Examples would be North vs South Korea, China vs Hong Kong & Taiwan, and West Germany vs East Germany.  See which system worked better for the most people.  If any conclusions could be drawn then they could be used to advise and guide other countries in their economic policies.

Here is a good example of where scientific methods could clear up some of the “Crystal Ball” (Trajan117 quote) aspects of economics.  Study real world examples of where the same culture and people are split up into two different economic systems.  One system is regulated and the other system is an unregulated, free market.

The comparisons you propose are both unscientific and ahistorical.

The “two economic systems” you refer to did not simply grow side by side in test tubes, but against one another as part of a global conflict in which one side (capitalist imperialism) always held the higher ground in terms of preexisting wealth, military strength and political influence. Meanwhile those countries that threw off capitalist rule were overwhelmingly situated in the hinterlands of the world economy (or regions that had previously been subject to decades of exploitation and underdevelopment by the imperialist colonizers). Moreover, the imperialists systematically used their advantages (bloody military interventions and other forms of miliitary pressure,  economic blockades, diplomatic isolation etc.) for the purpose of damaging or destroying the economies of the workers states wherever possible—eventually succeeding in the former USSR and Eastern Europe. 

This is not to say that there were/are no internal factors (e.g. bureaucratic degeneration misnamed as ‘socialism’) which negatively affect the development of non-capitalist countries, but these factors, too, were exacerbated by by both preceeding centuries of economic backwardness and the seige conditions created by hostile imperialist encirclement.

Once these factors are taken into consideration, and in view of the brutal the conditions in which they were born and struggled to survive, I would say that the workers states (like the former USSR) or today Cuba, China, Vietnam and North Korea (despite their bureaucratic deformities) show exactly the superiority of a centralized, planned economy over anarchic capitalist private property.

Study real world examples of where the same culture and people are split up into two different economic systems.  One system is regulated and the other system is an unregulated, free market.  Maybe the unregulated free market would lead to most of the profit going to the rich, but at the same time maybe the regulated economy would be even worse for the poor.  Examples would be North vs South Korea, China vs Hong Kong & Taiwan, and West Germany vs East Germany.  See which system worked better for the most people.  If any conclusions could be drawn then they could be used to advise and guide other countries in their economic policies.

But that is one of my points: it’s not a case that there’s a simple dichotomy between free market and command economies, as in all your examples. N. Korea, E. Germany, and China did (or do) not have regulated free markets, they were (or are) communist command economies.

More applicable is the US vs. the social democratic model of Europe. Contrary to DJ’s claims, the free market operates in the EU and is heavily (even too heavily in some particulars) regulated. But the results are clear: Europeans in survey after survey live longer, are healthier and better educated, are happier, enjoy longer vacations and shorter work weeks, are less stressed and anxious, and, for all that, are more productive than we are in the US. They enjoy single-payer universal health care and a wide social safety net. They don’t face ruin if a family member gets seriously ill, or the main bread-winner loses his/her job. The EU is no utopia, of course, but the evidence is in: a regulated free market on the social democratic model spreads the goods around more equitably and leads to healthier, happier populations. CEOs in Europe live very well indeed, but they don’t earn 400 times the salary of the average worker in their companies, they don’t get $50 million annual bonuses or jump ship with $350 million golden parachutes.

I have had the advantage of having lived for extended periods in the EU, Canada, and the USA. I have witnessed first hand how these societies work. I have utilized, for instance, the health services in all of them. So I know, when I see some talking head on Fox “News” spouting right-wing talking points about how “socialized” medicine spells the end of health care in the USA, or is less efficient and more costly, or more dangerous to its patients, etc etc is complete rubbish. It works perfectly well, and *everyone* is covered. In fact, it was far more efficient than what I’ve experienced of the health system in the US. There, you show up, show your health card, have your procedure, and you’re done. Here you show up, fill out forms, have your procedure, and then spend months receiving bills and statements, writing checks, and making phone calls to clarify or challenge charges.  All of that administration costs money, and that’s why the privatized system we have here costs 20-30% in overheads, whereas in, say, Canada, it’s 2%.

It’s a matter of prioritizing where your tax dollars go.

Back here to my most basic point: these are just my political opinions. I don’t claim, as Michael Shermer does, a scientific mandate for them.

And a quick clarification about politics on PoI. Obviously there are political issues that ought to be addressed here (the war on science from the right or left, the scandalous inaction of our government in the face of climate change, the role of technology in our lives, etc etc). So I am not against all political discussion in PoI podcasts or this forum. I am against, however, a particular political ideology or agenda claiming that it is scientifically-based and, by implication, that competing ideologies or agendas are not “natural” or “rational” or whatever. That is what I didn’t like about this podcast.

The comparisons you propose are both unscientific and ahistorical.

If you had read my post carefully you would have understood that I was proposing that we study history and try to apply the scientific method to it to try to make economics less nebulous.  That’s what scientists do.  They apply the scientific method to seemingly chaotic situations and try to extract truth from it.  I made no conclusions from the proposed comparisons.  The result was that you called my request for historical examination “ahistorical.”  You called my request for scientific examination of historical economies “unscientific.”

Michael Shermer’s interview, book and some of his recent articles touch on both politics and economics and so they are fair game for this thread.

In the 19th century it was Political-Economics.  Politics and economics cannot be separated.  People saying they are separate things are talking nonsense. 

The trouble is people let their social philosophies supercede the economics.

psik

Examples would be North vs South Korea, China vs Hong Kong & Taiwan, and West Germany vs East Germany.  See which system worked better for the most people.  If any conclusions could be drawn then they could be used to advise and guide other countries in their economic policies. (brightfut)

I agree with Balak that these examples are not very representative, not because they are ahistorical but because they are too historical.

If you want a good example, use an example that is limited to one economy - the examples of countries that were split is no good, because the splits created two new economies, oriented toward different larger economies, not two economies competing in one world economy.  A better set of recent examples would be comparing states that are basket cases with states that have managed some kind of “progress” (in quotes, because the “progress” is by no means unequivocal when you consider whole societies rather than a few cherry-picked economic sectors - establishing a factory is “progress”, bu not necessarily for the workers in it if they are underpaid, overworked, work in poor conditions, forced to work, etc.).

In any case, in virtually all the examples of 20th century economic success you will see a huge involvement of government.  Japan is one such example, where the line between government and business has been blurred since modern Western capitalist structures were first introduced.  China’s recent “progress” is entirely government sponsored and controlled.  Even in the U.S. government money in the form of government contracts forms the basis of a majority of corporations’ ability to plan (some very major companies would cease to exist without government money, many others would be crippled).

Try comparing one economy to itself, and see how it fares under a free-market free-for-all, and centralized planning.  Say - the U.S.  In every period where there has been a free-for-all, a few people get immensely rich, while others are ruined or kept poor, and then there is a period of reform and control where the middle class is slowly built up, only to be wrecked again.  In the late 1800’s there were a couple of depressions, then came reform.  In the post WWI years there was rampant corruption, and then a depression.  That depression was solved by government involvement - first the New Deal, which brought stability, then by WWII which brought prosperity - thanks to huge government involvement in the economy.  That involvement remained in place until the 80’s, when real wages started going down consistently, though not precipitously, because there remain huge institutions that continue o control large areas of the economy in some detail.

I think it is pretty clear that whatever country or economy you look at, you see that a lack of regulation almost inevitably leads to an increase in fraud, in violence, in unrest, in poverty, and all kinds of social ills, while government involvement leads to a more fair (though not entirely fair), more orderly, peaceful, prosperous, and happy society.  The problem with central planning has always been it fetishization of industrialism - all focus on the “commanding heights” and a disparaging of small business.  If you can avoid that, while allowing government to curb excesses and provide infrastucture (economic and physical), you get a betetr mix that leads to more freedom than any libertarian nonsense.  The question ends up as one of ethics, not economics.

Once these factors are taken into consideration, and in view of the brutal the conditions in which they were born and struggled to survive, I would say that the workers states (like the former USSR) or today Cuba, China, Vietnam and North Korea (despite their bureaucratic deformities) show exactly the superiority of a centralized, planned economy over anarchic capitalist private property. (Balak)

I don’t agree with this.  I think that the salient feature of planned economies that followed revolutions is their extremely rapid modernization.  But that modernization in turn depended on the technologies that alrady existed as a result of capitalist development.  In a sense, these economies were anomalies because they were in “backwaters”, and the Marxist theory applied to them was out of place because crucial elements of Marxist theory were absent (notably, a large and educated - in the Marxist sense - proletarian class).  The major achievement of those revolutions was not industrial, but agricultural, and only where they let up on the theory.

If you want to see a planned economy that tends to work well, you have only to look at capitalist corporations.  Every large corporation is nothing but a mechanism for planning production, for managing inputs and outputs, and managing demands as much as supply.  Much of government, even in the US, is devoted to economic planning - to gathering economic information and disseminating it in ways that seek to regulate the economy for the benefit of “the economy” (which usually amounts to a set of statistics).  This is probably the most important economic and political fact that libertarians (as well as socialist) overlook, or miss completely.  Just look at something like U.S. agriculture - heavily regulated, heavily planned, huge government involvement, near totalitarian corporate control, and it manages to produce so much food that overeating is the leading cause of death in the U.S. today.

No one advocates a completely centrally planned economy - such a thing cannot even exist.  However, the entire purpose of economics as a practical science (if it can be considered a such) is precisely economic planning.  That is the only mundane, practical, daily use of economic theory.  When a libertarian or free-marketeer complains of central planning or socialist planning or what have you, the real complaint is usually that law has gotten in the way of someone’s profit (i.e., someone’s frau