Saturday, 11 December 2010

Can the Non-Aggression Principle be "proved"?

All political philosophies are concerned with who has ultimate decision-making jurisdiction (ownership rights) over which scarce objects (property). That is, they are concerned with how property rights are assigned. Different political philosophies have different principles by which they assign property rights. Libertarianism is based on the principles of homesteading and voluntary exchange. Those principles are used to determine who owns what, and hence who has what rights.

The Non-Aggression Principle, or NAP, is in one sense trivial, because aggression is really defined as a violation of a legitimate property boundary, so it all depends on what property boundaries are legitimate. Everyone supports "non-aggression", except that libertarians and non-libertarians have a different idea of what constitutes aggression, because they assign property rights according to different principles. In this sense, NAP is a fairly useless term, as it is simply a re-statement of the task of political philosophy: to give meaning to aggression, to explain what constitutes aggression, to say what property boundaries are legitimate.

In another sense, if we take the A of "NAP" as meaning specifically the libertarian idea of aggression, then it is simply a restatement of the libertarian principles for assigning property rights. To "prove the NAP" (in this second sense) would be to "prove the libertarian principles of homesteading and voluntary exchange for assigning property rights".

Can this be proved? To prove it would mean to say that homesteading and voluntary exchange, as principles for assigning property rights, are not just a preference (subjective), but that they are the objectively correct principles for assigning property rights.  Hans Hoppe's Argumentation Ethics is one attempt to do this.

What argumentation ethics actually proves, in my opinion, is different. I do not believe it "proves the NAP" or "proves libertarian ethics" which is what I believe it sets out to do. I think the clearest explanation of argumentation ethics comes from Stephan Kinsella: here.

So the question is, does Hoppe's theory establish that the libertarian view of rights, as opposed to competing views, is the correct one?


Hoppe starts by noting that if any proposed theory of rights is going to be justified, it has to be justified in the course of an argument (discourse).

The problem is right here at the start. Is a theory of rights something that can be justified through argumentation? Is there a correct view of rights? Does that question even make sense?

Libertarian rights can be argued for because they are good (they appeal to our human senses of right/wrong) and beneficial (breed prosperity). But this is a justification of libertarianism as a means for already existing ends. It is not justifying them as an end, saying "this is the correct theory of rights, anyone supporting any other theory of rights is incorrect." It is saying "if you think initiating coercion is unethical, or if you just prefer prosperity to poverty, then libertarian ethic is the correct ethic for you".

The rest of Hoppe's argumentation ethics may be (and, I think, is) sound, but what I think it proves is if there is such a thing as objective ethics, i.e. if it is possible to show that one ethic is correct and all others are incorrect, then the libertarian ethic is the only correct and true theory of ethics.

So if a socialist says "I support socialism because it is correct and libertarianism is incorrect", then we could show that he is making a performative contradiction and what he says is not true. If there is such a thing as a correct ethic, libertarianism is it.

But most socialists don't claim that their ethic is correct, just that (they think) it is good and beneficial. The way to counter this is 1) to show that the libertarian ethic is actually the most beneficial ethic (using Austrian economics) and 2) by appealing to their personal ethical values, their sense of justice, of right and wrong, and helping them to see that the socialist ethic is really not one that any good person should be in favor of.

It does not make sense to talk about correctness/incorrectness, and hence of proofs, in the realm of ethics. Ethical values are values; they are subjective. We can appeal to non-libertarians' personal ethical values (showing they conflict with their political ethical values), and we can show them their political ethical values, when implemented via laws, have bad consequences; but we cannot present them with any proof that they are incorrect to hold to the political ethical values that they do. Political philosophy is simply not a subject which has objectively correct and incorrect answers, except as a means of achieving a particular goal.

Note: this is a copy of a post I made at the Mises forums: here.

Environmentalists should be libertarians

Environmentalists should be libertarians because free markets will in most cases better satisfy their desires - saving the whales, preserving forests, stopping animal cruelty, etc - than will socialist alternatives.

Libertarians qua libertarians do not have a view on whether any particular environmentalist goal is worth it or not. We just say let's have a free market so that the views of everyone are encapsulated in free market prices, so that the amount of resources devoted to particular and environmental causes generally is precisely the amount of resources that the individuals in society are willing to devote to them.

The alternative is having the politicians guessing this and using highly inefficient (and unethical) socialist techniques to try to achieve environmentalist goals. Also, there are the usual public choice problems associated with socialism and democracy in particular: pandering to special interests, bribery, corruption, short-term thinking, waste, etc. These are widespread problems when it comes to state environmental policy-making.

Saturday, 27 November 2010

Secession: Who Decides?

The EU is deeply unpopular in the UK and other European nations. The British people never voted to join the EU, and if there were a referendum, I have little doubt that the result would be Yes for the UK to withdraw (secede) from the EU.  The EU has brought about a resurgence in nationalism, and rightly so.

That no referendum has taken place is profoundly unjust. Membership of the EU should be decided upon by the British people, not by politicians, nor by anyone outside the UK.

But why stop at the secession of the UK from the EU? Consider Scotland. Who should decide whether Scotland should secede from the UK? To be consistent, it should be the people of Scotland, not politicians, and not the people of the UK. If the Scottish people want to secede from the Union, it is unethical for anyone to prevent this.  Membership of the UK should be decided upon by the Scottish people.

The same principle applies at an even more local level. If the people of the county of Cornwall, or Yorkshire, or Buckinghamshire wish to secede from the UK, or the people of the city of Oxford, or Liverpool, or Bristol wish to secede from the UK, it would be unethical for anyone to prevent their secession.

Perhaps you can see where this is going. If a small village community, or a family, or a single individual wish to secede from whichever state they are a subject of, who should decide? Well, the secessionist(s) themselves, of course, and not the entity they wish to secede from.

If one opposes the EU and believes in the right of secession at all, they must recognize the right of individual secession. That is, they must recognize the right of any individual to stop paying taxes and to stop following the rules and regulations forced upon him by the state, whenever he wishes.

Nationalism, while preferable to internationalism, is a blatantly inconsistent doctrine. The only consistent positions are a one-world government (which is justifiably, almost-universally unpopular) or individual secessionism, also known as libertarian anarchy.

Monday, 22 November 2010

Statism is at odds with diversity

A common argument against the EU is that it is not possible or beneficial to have a centralized authority controlling such a diverse group of peoples and cultures.

The idea is that the same governmental policies will not work over the whole of Europe. Laws will have to be different in different areas, because in different areas people have different cultures and values. It is recognition that values are subjective; nothing is ‘inherently’ valuable; if something is valuable, it means it is valuable to someone.

But when you think about it, there is no such thing as ‘group values’. Saying Scottish people like haggis is not literally true of all Scots and of no one else. It is a broad generalization. Italian people don’t value pasta as a group, although many of them value it as individuals. No two individuals have exactly the same values or opinions; we are a wonderfully diverse species.

So the above argument against the EU in favor of nationalism works equally well as an argument against nationalism and in favour of localism and ultimately individualism/anarchism.

If the people of Scotland should not have the same laws as the people of Turkey, why should they have the same laws as the people of England? The counties of Scotland each have their distinct character, where people have different values, so why should all of Scotland be controlled centrally from Edinburgh (or anywhere else)?

This line of thinking leads directly to individualism/anarchism: why should any two individuals have to live under the same laws if they don’t want to? After all, they have different values.

The End of War, or How to Minimize Conflicts

In a trivial sense, anarchy will eliminate war, because war can be defined as a conflict between states.

Needless to say, this response is not satisfactory to people who believe that without states, there will be more war. They are using a broader definition of war than just conflict between states.

The broadest possible definition of war would be any conflict between two individuals. Then the question of whether statism or anarchism will have less war becomes the question of what system will minimize conflicts.

The question of what ultimately causes conflicts lies largely outside the realm of political philosophy and economics (and in psychology), but we can ask:
  • Will conflict prevention industries be more effective in a free market or under state control?
  • Will conflict resolution industries be more effective in a free market or under state control?
In other words, we can examine arrangements in the security and law industries.

Before thinking about how the security and law industries might be structured in a free market (which is difficult because we are all personally familiar only with how states structure these industries), we can say, using general economic principles, that we can expect greater quality, efficiency and service, lower prices, more dynamism, diversity and choice, and less corruption, with a free market arrangement than with a state monopoly.

All this means that we have every reason to believe that there would be fewer conflicts if the security and law industries were provided by a free market, i.e. libertarian anarchy. That is, in the broadest sense, war would be minimized by anarchy.

For an examination of how free markets in security and law might be structured, see the writings of Murray Rothbard, Hans-Hermann Hoppe and David Friedman.

Wednesday, 10 November 2010

Do unschooling parents need to be all-wise?

The key idea of unschooling is that children should direct their own education, choosing their own teachers. They will find out how they learn best, because they have a natural curiosity and desire to learn. Too often, this passion for learning is stamped out of them by being taught things they don't want to learn, and coming to see learning as a passive, dull process, which is directed by somebody else, not by them. The directing could come from a state school, a private school, a private tutor, or their parents.

The proper role of the parent is to facilitate learning, primarily through imparting on their children how to teach themselves, or how to find teachers and resources. A young child may ask their parents 'how does a car work?' or 'when did dinosaurs walk the earth?' or 'what makes trees grow?'. Can you answer these simple questions in any kind of depth, without googling them, or asking someone, or going to a library to read up on them? If you honestly answer 'I don't know; but I know how to find out,' and then explore the answers to those questions along with your children, they will soon be teaching themselves things without your assistance. When they get a bit older and start to explore higher-level science, they may want to take some formal education, perhaps a university or specialist private school or private tutor, and if they do they should be encouraged.

So to address a couple of common concerns of parents who do not send their children to school, there is no need to hire a private tutor, and doing so may even harm the child's ability and desire to learn. And there is no need for a parent to be all-wise, able to answer any question; they must only know how to find out the answers, and enthusiastically encourage their children to seek out the answers.

David Friedman recognizes that a large part of his education came from places other than school, and he unschooled two of his children: here he talks to Stefan Molyneux about it.

Tuesday, 9 November 2010

Why do bankers love their central banks?

Bankers love having a central bank because it enables them to lend more money than they have, so they collect more (a lot more) profits from interest payments than they would otherwise. This is known as fractional reserve banking.  There are natural limits to fractional-reserve banking imposed by markets, and the central bank makes it possible for commercial banks to bypass these limits. The central bank is the institution through which the commercial banks are cartelized and protected from competition.

Bankers support the money monopoly, the "lender of last resort" function, deposit insurance, the high rate of inflation, and all kinds of regulations (FSA, EU, IMF, etc), because it strengthens their cartel. The ideal scheme for the bankers would be a global central bank, with a global monopoly of (ideally paper) money, and international bailouts and regulations. The history of banking is the story of how the bankers, and the politicians who are happy to go along (they can finance deficits and inflate away their debts), have removed one-by-one all the market-imposed limits on fractional reserve lending. See Murray Rothbard's 'The Case Against The Fed'.

Check out the Ludwig Von Mises Institute video 'Money, Banking and the Federal Reserve'. It avoids the serious economic fallacies that undermine the otherwise-decent videos 'The Money Masters' and 'Money As Debt', and lead them to offer false and terrible solutions, like Lincoln-style Greenbanks. It highly praises the gold standard, because having gold backing the notes is a major market-imposed limit to fractional reserve banking. But the ultimate goal is a market-based money. Re-imposing a gold-standard dollar, controlled by congress, would be a second-best or interim measure; it would still be a money monopoly, but the boom-bust cycle and inflation would be significantly reduced, and it may ease a transition to market-based money.

Ron Paul, well-known for his support of the gold standard, shows that his ultimate goal is market-based money, when he says:

"Money will be honest, the unit precisely defined, and its integrity guaranteed by government or by voluntary contracts. Counterfeiting privileges of the Fed will be abolished and relegated to notorious underground figures. Honest money will allow credit to be freely created in the market and not by the privileged banking cartel, yet controlled by the integrity of the market and the convertibility of the dollar. The economic benefits of low long-term fixed interest rates will be welcomed by all, since credit can then fuel true long-term economic growth." [emphasis added]

Thursday, 28 October 2010

The God Delusion

I just finished reading "The God Delusion" by Richard Dawkins.  A remakable book; I thoroughly enjoyed it.

Dawkins begins by defining the subject matter of the book.  He distinguishes between faith-based religion, and "Einsteinian religion," which is really no religion at all.  Einstein, like many other scientists, such as Stephen Hawking, use the term God only in a metaphorical and poetic sense; this can lead to confusion.  When Einstein said "God does not play dice," he meant something like "Randomness does not lie at the heart of all things," and when he asked "Did God have a choice when creating the universe?" he was really asking "Could the universe be any other way than how it is?".  This metaphorical kind of "religion" and "God" is not the subject of the book.  Dawkins is out to demonstrate that the literal, faith-based God is a delusion, and that religion in the literal sense is misguided, dangerous and discourages independent thought.

Chapter 2 begins with this amazing sentence:
"The God of the Old Testament is arguably the most unpleasant character in all fiction: jealous and proud of it; a petty, unjust, unforgiving control-freak; a vindictive, bloodthirsty ethnic cleanser; a misogynistic, homophobic, racist, infanticidal, genocidal, filicidal, pestilential, megalomaniacal, sado-masochistic, capriciously malevolent bully."
Wow.  This sets the tone for the whole book.

In chapter 3, he demolishes the arguments in favor of a literal God, such as the "proofs" of Thomas Aquinas, and the arguments from beauty, personal experience and scripture.  In chapter 4, Dawkins shows 'Why There Almost Certainly Is No God".  He presents the arguments for evolution by natural selection, clarifying many popular misunderstandings - such the belief that evolution is a "random" process - and shows that the existence of a Creator is unnecessary and extremely improbable.

Chapter 5 explains why religious belief came about, in terms of evolutionary psychology.  Chapter 6 explains why moral genes were naturally selected and why religion is not necessary for morality and chapter 7 explains that even devout religious believers do not truly get their morals from religious texts, despite their claim to do so.  This is because the major religious texts are self-contradictory and downright immoral in so many ways; religious believers must have some way of deciding which morals they will live by and which moral lessons they will ignore.

In chapter 8, Dawkins explains why it is important to question religion and faith-based beliefs, and not give them a 'free pass' and undeserved respect.  Religion is a divisive, destructive subversion of science, and religious believers tend to be unthinking, unoriginal, fanatical, and gullible, accepting authority without question.  In chapter 9, Dawkins argues that raising children with religious beliefs is a form a child-abuse and such mental abuse can be far worse than physical abuse. 

Having demolished arguments for religion as an explanation (Chapter 4) and exhortation (Chapters 6 and 7) for human life, Dawkins briefly considers the role of religion as a consolation and an inspiration in chapter 10.

Overall, a fantastic and explosive book, recommended to anyone, religious or not.

There are various youtube videos of Richard Dawkins talking about this book and many of his other books.  Here is one example, where Dawkins reads extracts from "The God Delusion" to students, many of whom are devout Christians.  The question-and-answer session (part 2) is highly entertaining. 

Thursday, 9 September 2010

The 'Find Your Philosophy' Quiz

I just completed the 'Find Your Philosophy' quiz over at the Center for a Stateless Society.

Here are my results:

The best thing about this quiz is that is has a paradigm for anarchist-statist.  This is the most important paradigm of these five.  Fortunately, I got 100% anarchist.

My high scores as an anti-militarist and civil libertarian are not surprising (the surprising thing is that I did not get 100%!). 

I really have no idea what an "economic leftist" is.  Economics is a value-free science; there is no left and right in economics, only correct and incorrect.  Perhaps it refers to government policies with regard to the economy, but then how have I not come out as a radical?! 

No quiz like this can be perfect.  I am particularly surprised to learn that my socio-cultural views are extreme liberal.  I guess this is because I couldn't care less what race, gender or ethnicity the spouses of my children are...

Does 'no government' mean 'no laws'?


A government is defined as a territorial monopolist of the production of law. Law is the resolving of disputes. The defining feature of government, then, is the use of force (violence or threats of violence) to forbid anyone else acting as the final arbiter in cases of a dispute.[1]

With a monopoly on law, government can forbid competition in other industries, through the act of legislation. For example, it can outlaw private currencies, or private schools, or private restaurants. By doing this, the government establishes for itself a monopoly of the money industry, or the schooling industry, or the restaurant industry.

‘No government’ (i.e. anarchy) therefore means ‘no monopolist over the law industry’. The alternative to a monopoly, as always, is a free market. An anarchist is therefore defined as an advocate of a free market in law (and therefore also free markets in all other industries). [2]

Restaurants: Free Markets vs. Monopoly

Government has little interest in establishing for itself a monopoly over the restaurant industry. Free market firms operate and compete with each other in that industry. Entrepreneurs are free to respond to the demand for restaurants by providing restaurants.[3]

Few people, perhaps only communists, would argue that governments should take over all existing restaurants and outlaw all competition. Not only would such action be highly unethical, but it would also lead to catastrophic consequences in terms of the quality of the product. Free markets in restaurants give us high quality food and service, diversity that matches the diversity of consumer tastes, and the efficient use of resources to bring us the lowest possible prices. Competition eliminates any restaurant that is failing to meet consumer demand and provide a quality product. Bad restaurants go bankrupt and close down.

Schools: Free Markets vs. Monopoly

Schools are run as a government monopoly.[4] As a result, the quality of the product – the standard of education – is lower than it would be if schools were provided by competing free market firms. With a government monopoly, there is always inefficiency, waste, a lack of diversity, high prices, poor service, and a large potential for corruption. Politicians and special interest groups determine what is taught in schools, and how. There is no mechanism for ensuring that the schools are satisfying consumer demand, or making good use of resources. Bad schools endure.

Despite the existing government monopoly on schools, it is not difficult to imagine how schooling could be delivered on a free market. Firstly, full government monopolies over the schooling industry only began in the late 19th / early 20th century, so we can look to the past to get clues as to how a free market in schools may work.

But more importantly, we can apply economic insights, since these apply to all industries. The question is always the same: free markets or monopoly. We can learn a great deal about a free market in schools by examining existing free markets and drawing analogies.

Schools and Restaurants: An Analogy

Here are some questions that may arise when contemplating a free market in schooling:
  1. Who will run the schools?
  2. What will they teach?
  3. Couldn’t a ‘greedy capitalist’ indoctrinate the kids?
  4. How can we ensure teaching is high quality, without government-granted licences to teach?
  5. How many schools will there be in my town?
  6. How much will they cost?
  7. How much diversity will there be among schools?
  8. Won’t rich people get a better education than poor people?
  9. What about poor people who cannot afford any type of school?
These are all interesting questions. But consider if we were living under a monopoly of the restaurant industry. The following questions may arise:
  1. Who will run the restaurants?
  2. What food will they serve?
  3. Couldn’t a ‘greedy capitalist’ serve poor quality or poisonous food?
  4. How can we ensure chefs are high quality, without government-granted licences to cook?
  5. How many restaurants will there be in my town?
  6. How much will they cost?
  7. How much diversity will there be among restaurants?
  8. Won’t rich people go to better restaurants than poor people?
  9. What about poor people who cannot afford to go to restaurants?
Some of these questions sound absurd to those of us accustomed to living in a society where restaurants are provided on a free market. These fears and concerns are not justified, and the questions are not worth losing sleep over. In the restaurant industry, things just work.

They work because of the economics of the free market system, where entrepreneurs are constantly striving to satisfy consumer demand. If there are not enough, or too many, restaurants in town, for example, this will quickly be corrected, when an entrepreneur sees the potential for profits by opening a new restaurant, or suffers losses and has to close down. The only thing that can stop this market process, of constantly adapting the structure of production to best satisfy consumer demands, is government intervention.

The Production of Law

We are not used to thinking of law as a product. We are not used to applying economic insights to law. But from the economic perspective, law is a product no different from any other. It is demanded by consumers, and it can be provided either by a monopoly or by free market firms.

Now consider the following questions:
  1. Who will run the courts and write the laws?
  2. What laws will they write?
  3. Couldn’t a ‘greedy capitalist’ produce laws that are biased in his favor?
  4. How can we ensure private judges are wise, honest and fair?
  5. How many different producers of law will there be in my town?
  6. How much will I have to pay to buy laws?
  7. How much diversity will there be among law codes?
  8. Won’t rich people get better quality laws?
  9. What about poor people who cannot afford to buy laws?
These are some of the concerns of statists (or ‘archists’) when they contemplate the prospect of anarchy (a free market in law). These questions are analogous to the concerns about the schooling industry being a free market, and the hypothetical concerns that people would have if we were living under a monopoly in the restaurant industry, such as in the Soviet Union, and were contemplating a free market in restaurants.[5]

Much has been written about how law might be delivered in a free market. While throughout history there have been far more statist societies than anarchic societies, there is much that can be learned from studying how law has previously been produced in the absence of government.[6]

Anarchists such as Murray Rothbard, David Friedman and Hans-Hermann Hoppe have speculated about how a future free market in law may work, informed by economic insights (including analogies to existing free markets), historical precedents, and legal/political theory. They attempt to provide answers to the questions and concerns listed above. In this brief essay, I intend merely to point out that the concerns are directly analogous to concerns about free markets in any industry.


What will we say to the Soviet man, living through the collapse of communism, when he asks us how restaurants will be provided without a government monopoly? Just that free markets work. Any problems will sort themselves out through the market process. There is nothing to fear. There is everything to gain by having a free market in restaurants. The quality of restaurants can only get better by being subjected to market forces.

Does ‘no monopoly in the restaurant industry’ equate to ‘no restaurants’? Of course not: it means that they will be provided by the free market firms. Would ending the government monopoly on schools mean there would be no more schools? Again, no, because there is consumer demand for them, so free market firms will provide them.

Does ‘no government’ equate to ‘no laws’? Clearly the answer is no. It means that laws will be produced by free market firms in response to consumer demand. Anarchy means no rulers; this does not equate to no rules.

  • Benson, Bruce – The Enterprise of Law (1990)
  • Friedman, David – The Machinery of Freedom (1974)
  • Hoppe, Hans-Hermann – Democracy: The God That Failed (2001)
  • Rothbard, Murray – For a New Liberty (1973)
  • Stringham et al, Edward – Anarchy and the Law (2007)

[1] This includes disputes involving the government itself. The government is judge in its own cases. There is no third-party arbiter in disputes between individuals and the government.
[2] In this essay, when using the term ‘anarchist’, I mean libertarian anarchist. The modifier is unnecessary from a theoretical perspective, but is added for clarity since the term sometimes refers to ‘anarcho-communists’ and other non-libertarian anarchists.
[3] Government enforces regulations on restaurateurs, but compared to other industries, the regulations are small in extent; there is a considerable amount of freedom in that industry.
[4] Even the nominally ‘private’ schools are subject to strict and heavy regulations.
[5] Such questions were common around the time of the collapse of the Soviet Union. Many people feared they would starve to death without state-provided food and a central planning monopoly commanding the food production industry. “How will the farmers know what food to produce and how much of it?”
[6] Examples of anarchist, or near-anarchist, societies include Medieval Iceland, pre-conquest Ireland, and the early American colonies. See Rothbard, Friedman, Benson, Stringham et al. Roman Law, Common Law and Merchant Law all originally developed under free market conditions, but co-existed and were later subsumed into government-provided law.

Saturday, 4 September 2010

Parent-directed education and statism

I want to discuss three modes of child education: (1) State-directed learning, (2) Parent-directed learning, and (3) Child-directed learning. The first is clearly unethical and should be rejected.

The Unschooling philosophy is that children learn best when they direct their own learning. "Go to school / learn this now... or I'll spank you!" and "Go to school / learn this now... or you don't get any tea!" are examples of parent-directed education. Saying "Go to school / learn this now... or I'll be very disappointed" or "Go to school / learn this now... is my advice" would indicate child-directed education. There are continuum issues about what constitutes true child-directed education; the age of the child is a factor.  But the distinction between child-directed and parent-directed learning is an important one.

An analogy can be drawn between parent-directed vs. child-directed learning, and statism vs. anarchism.

The parent who directs his own child's learning is assuming that a child cannot or will not learn the things they ought to learn. The mindset is one of 'taking control', setting goals, making measurements and determining what should be learned, like a statist, rather than a mindset of letting things play out naturally, trusting in liberty and markets, like an anarchist.

Unschooling advocates disagree with the idea that a teacher (or parent) should have 'core objectives' that they direct their children to learn. Children learn things because they want to learn them. Who says that anything needs to taught as a 'core skill'? Take reading and writing. Obviously a person will struggle in life (to say the least) without these skills. But because they are so important children recognise for themselves that these are things they need to learn, and that's why they learn them. A child does not need to be given motivation; the motivation comes from within.

Is it important for a person to know Pythagoras' Theorem? Maybe; it depends on what that person wants to do. I think we can leave it up to the child, whether they want to learn it. If they want to be an engineer, they will surely learn it themselves without being directed. If they want to be an actor, maybe it would be better if they spent more time in drama classes rather than maths classes.

There is even a manifestation of the economic calculation problem, which plagues all state monopolies. A state monopoly (such as state-run security, roads, or healthcare) cannot know whether it is using resources efficiently for satisfying consumer desires, because it has no feedback mechanism. Free market firms are able to calculate profits and losses because of the existence of market prices, which provide instant feedback on supply and demand conditions. Free market firms can then be sure that they are using resources efficiently, while state monopolies can only guess at how best to use resources.

How can a parent, who is directing his child’s education, know what is best for her child, the best way her child learns, and the best way to facilitate this learning? Without letting the child decide, the parent cannot know whether any given skill or knowledge is desired or useful, or how much of the child's "learning time" and resources should be spent on each subject. They can only really guess at these things. But by letting a child direct their own learning, the child will demonstrate his desires through his actions, and try to attain his ends as efficiently as possible. With parent-directed education, the lack of a feedback mechanism makes economic calculation with respect to education impossible.

Children learn best when they direct their own learning.  The proper role of the parent is to facilitate and advise, not to direct.

Thursday, 26 August 2010

What is a Right?

All rights are property rights, or rights of ownership. That is, the word ‘right’ does not make any sense except in terms of property and ownership. So, first of all: what is property?


Property is the word given to scarce objects which are under human control, claimed, and given boundaries. Property rules are rules establishing what individuals can and cannot do with the scarce objects around them. They are rules used for resolving conflicts peacefully.

Now I will deconstruct this definition of property.

A scarce object is one over which a conflict may arise, where two individuals both want to use the object, but they cannot. Scarcity is context-dependent. Usually, oxygen in the air is not a scarce resource, because my use of the oxygen in the air does not prevent you from also using the oxygen in the air. Water is usually scarce, because only one individual can use a given piece of water; my drinking the water prevents you from drinking it.

A scarce object is under human control if one individual possesses the ability to use the object as some means in action. The sun is not under human control, since no one has the power to control it.

A scarce object is claimed if one individual expresses his will to use the object and to exclude others from using it.

The scarce object being claimed must have definite boundaries, delimiting the extent of the control asserted in the claim.

The first step to resolving a conflict (a property dispute) is to ask the question: has a legitimate property boundary been violated? Aggression is the term given to a violation of a legitimate property boundary.


The owner of a property is the individual who has expressed a claim to it; the individual claiming ultimate decision-making power over how the property is used.  When two or more individuals claim to be the owner of some property, a conflict arises.

Let us suppose the conflict relates to an apple. A has eaten the apple, but B claims that he was the owner of the apple, and hence A has violated his legitimate property boundary, i.e. B claims A has aggressed against him. A retorts that in fact he had ownership of the apple, and therefore did not violate any property boundary. Both men are claiming ownership of the apple. Both men are claiming the right to be able to use the apple: the right to ultimate decision-making jurisdiction over it.

We can now elaborate three different senses of ownership:

De facto ownership. A de facto owner of some property is the individual who, in fact, has ultimate decision-making power over how a property is used.

Legal ownership. A legal owner of some property is the individual who, were a dispute to arise over the property, a given court (dispute resolution service) will award ownership to.

Normative ownership. A normative owner of some property is the individual who should have ownership of the property, according to some particular legal philosophy.

To continue with the example, who is the owner of the apple? Well, suppose that, for some reason, B backs down and accepts that A was the owner of the apple. Then, it is the case that A is the de facto owner of the apple. His will prevailed.

Let us suppose instead that A and B both stand firm, and decide to approach C to try and resolve the conflict through peaceful means. C decides that B was the owner, so A did violate a legitimate property boundary. In this case, B is the legal owner of the apple, according to the property rules as pronounced by C.

All legal philosophies relate to who should have ownership of a given property. They make assertions about who the rightful (proper, just, normative) owner of a given property is. They are based on some principle of assigning property rights.

For example, consider a philosophy which asserts that the normative owner of all apples is A. According to this philosophy, A is therefore the rightful owner of the disputed apple. If the case is taken to C, and C uses property rules based on this philosophy, he will award legal ownership to A.

Libertarianism is a philosophy which asserts that the rightful first owner of any property is the homesteader (the individual who has established an intersubjectively ascertainable link between himself and the object, by bringing that property into existence). Subsequent owners are only considered legitimate if they have all acquired the property through voluntary exchanges.

Let us suppose that it was B that picked the apple from an unowned tree. According to the libertarian philosophy then, B is the rightful owner. A libertarian court, pronouncing property rules based on the libertarian philosophy, would award legal ownership of the apple to B.


I will now return to the original question: what is a right?

There are three senses of rights. De facto rights are those rights that are actually in place in a given situation. If it is the case that A eats the apple, and B accepts this, then A has a de facto right to eat the apple. He is the de facto owner of the apple. Legal rights are those rights which are recognized by a given court. Normative rights are the rights that are regarded as just by some particular legal philosophy.

Much confusion arises due to confusing these different senses of rights. Consider the following example: the right to possess heroin. A legal scholar may turn to a set of laws and discover that no one (except the government) has the right to possess heroin. He is referring to legal rights.

A socialist philosopher may argue that no one (except the government) has the right to possess heroin. A libertarian philosopher may argue that all individuals have the right to possess heroin. They are both talking about normative rights; they disagree because they have different ideals and principles for how property (and therefore rights) should be assigned.

It may be the case that some heroin is not in fact owned by the government, but non-government individuals actually have full control of some of it. The government has expressed a claim to be the only ones with the right to possess heroin, but they are unable to enforce their claim. The heroin possessors have de facto rights to their heroin, but no legal rights, according to the government-run courts. Anyone who has a view about whether heroin should be legal or not is making a normative assertion about rights, based on their ethical values.

The Existence of Rights

Confusion over the definition of rights leads some people to proclaim that “rights do not exist”. Given the definitions above, it is clear that de facto rights always exist, and legal rights always exist, so this statement is incorrect. It may be claimed that what is meant by this statement is that normative rights do not exist. However, this is also incorrect. Everyone who has a view about what justice is, about what actions are aggression, about what constitutes ethical and unethical behaviour, is making a judgment about how property rights should be assigned.

The sentiment behind this statement could be better stated as “objective normative rights do not exist”. That is, there are no objective rules about ethics, about how property rights should be assigned.

That rights exist is undeniable. It is up for debate what constitutes just property rights, and legal philosophers of all kinds attempt to answer this question – libertarians and socialists alike.

Sunday, 15 August 2010

Austrian Business Cycle Theory - How Government Manipulation of Interest Rates Causes Booms, Busts, Recessions and Depressions

This presentation starts by looking at how the market process works: coordination through prices and profits.

The two alternative theories of the business cycle are introduced:

- The non-Austrian theories, which blame the cycle on the free market and call for government to take control.

- And the Austrian Theory of the Business Cycle (ABCT), which blames the cycle on government manipulation of interest rates.

The boom, bust and recession stages of the ABCT are analyzed in detail. It is concluded that government actions only prolong recessions and make them more severe. And the business cycle would not occur with interest rates determined on a free market.

This presentation was first delivered in July 2010.

Video: Technology and Social Change

Here's a video of a great talk on technology and social change by Jeffrey Tucker. Amusing anecdotes, insightful analysis of the market process, and some excellent utilitarian arguments against intellectual property.

Saturday, 14 August 2010

How Much Government is Necessary?

A lengthy, in-depth discussion and debate of the question: how much government is necessary.  Stephan Molyneux argues the anarchist position that no government is necessary.  Michael Badnarik defends the minarchist view that a small government, limited by a constitution, is necessary for the production of law.

Video: The Philosophy of Liberty

I have always found this little animation compelling for its simplicity in demonstrating the principles of libertarian philosophy.

Money. What is it?

A collection of clips from Hans-Hermann Hoppe and Jorg Guido Hulsmann lectures, providing succinct answers to questions such as: Why do we trade? What is money What is inflation?

What is the Austrian School of Economics? How does it differ from Marxist, Keynesian and Chicago Schools of Economics?

Economics is, understandably, known as ‘the dismal science’. Get a large group of economists in a room together, and they will likely provide a huge variety of different, and mutually contradictory, answers to the same question. It may be a question about government policy, or about what causes prosperity, or about what causes booms and busts. It may even be a more fundamental question about a basic economic law or principle.

Economists are often misunderstood, and misunderstand each other. They often have different definitions of basic terms like money, inflation, monopoly, savings and profits. Debates about economics often sound like the Tower of Babel, where mutual misunderstandings abound.

Economists will even disagree with each other on the question: what is economics?

Economists are categorised according to which “school of thought” they subscribe to. The major schools are Marxists, Keynesians, Chicagoans, and Austrians.

The Austrian School has a unique approach to economics. While all the other schools perceive economics as being an empirical subject – in which hypotheses are created from observations, data and statistics, and tested using predictions – the Austrian School perceives economics as an axiomatic-deductive subject, similar to mathematics. Austrian economists reason with logic rather than through use of the “scientific method”, which they criticize as being inappropriate for the science of economics.

All Austrian economic laws and principles are logically derived from a single axiom: that humans act. That is, humans behave purposefully, using means to try to achieve chosen ends; rearranging their environment to a more satisfactory condition to try to remove “felt uneasiness”.

Basic economic principles – such as the law of association (aka the law of comparative advantage), the law of marginal utility, and the law of diminishing returns – can be derived from the action axiom using logic.

By understanding the laws of human action, we can understand how the market process works. The market process is coordinated by profits, and operates through entrepreneurs being free to seek profits. This is the so-called ‘invisible hand’ which guides the actions of humans and results in a complex structure of production that maximises prosperity. Due to the market process, no central planner is needed for society to function or for prosperity to be generated. No state is needed.

In fact, Austrian economics shows that all government actions – the very existence of government itself – must lower the level of prosperity in society. All government actions waste resources, because when a government involves itself, it disrupts the market process which maximises prosperity. Governments can only redistribute and destroy wealth; they cannot add to it.

Austrian economics is “value-free”. It does not assume any particular ideology. It merely demonstrates the effects of different ideologies, policies and actions. If the economist adopts prosperity as his goal, he must advocate free markets. If the economist favors poverty, at least for some individuals, he must endorse some from of government interventionism. This is the lesson of Austrian economics.

The ultimate form of government interventionism is pure socialism: a monopoly run by the government. This arrangement will lead to impoverishment. The major problem with monopoly, from an economic perspective, is an ability to calculate. The monopolist cannot rationally allocate resources, since that requires prices that have been formed in a free market. Supply and demand are thus critically severed, and there is vast wastage of resources.

A government monopoly, unlike a free market firm, does not go out of business when it fails to satisfy consumer desires efficiently. It endures, and may even receive more of the proceeds of taxation. Incentives are chronically skewed. Corruption is endemic. The structure of production is geared not towards satisfying consumers, but towards enriching the monopolist at the expense of consumers. A monopoly is a system of coercive wealth redistribution.

The two alternatives – free markets or monopolies – are central to any political discussion. Should any given industry be run by a monopoly or by free market firms? The question is always the same. Austrian economics shows us that, whatever the industry, a free market will best satisfy consumers.

A market that is subject to regulations, but not entirely socialized, is a middle-of-the-road policy. The number, nature and scope of the regulations in an industry determine the extent of cartelization in that industry. A cartel is a set of firms that has been given a monopoly privilege in a given industry. All regulations have the effect of cartelizing industries; benefiting existing producers at the expense of potential new competitors, and protecting large firms at the expense of smaller firms.

In terms of policy endorsements, Marxist economists tend to favor full socialism, aka communism. Keynesians and Chicago School economists tend to favor full socialism in certain industries (such as law, security, money, roads, education). In other industries, Keynesians tend to favor heavy regulations, a system known as corporatism or State-capitalism, while Chicago economists tend to favor some free markets. These economists have reached different conclusions based on their various ways of analysing and interpreting economic data, which is the nature of economics in their view.

Austrian economists disregard data when formulating theories. Data can only be used to demonstrate Austrian theory in action. Austrian theories cannot be falsified by any new data or observations. Austrian economics is logically derived from an incontestable axiom; so long as the logic is sound, the theories are similarly incontestable, or apodictically certain.

Since Austrian economics demonstrates unequivocally that free markets generate prosperity better than monopolies or government interventionism, in any industry, Austrian economists tend to be libertarian anarchists.

What is Anarchy?

Anarchy is absence of government. Government is a territorial monopolist of law. Anarchy is therefore a free market in the production of law.

The term anarchy literally means “no rulers”. The relationship between rulers and the people they rule over is a master-slave relationship. Anarchy, then, can also be interpreted as “no slavery”.

Absence of rulers does not mean absence of rules. Rules – laws specifying property ownership – are necessary for society to function, and they can be voluntarily agreed to. The usefulness of rules creates market demand for them, as with any other good. Entrepreneurs will therefore strive to meet that demand, by establishing courts and employing judges to resolve disputes.

Driven by the profit motive, the laws produced under a free market arrangement will reflect the customs of society and the views of consumers about justice. As always under a free market arrangement, the laws will be high quality, produced efficiently and for a low price. There will also be diversity of courts available for consumers to choose from, perhaps using different legal codes.

All legal systems specify rules for property ownership. They determine who the “rightful” owner of any given property is. In the event of a dispute, a court must determine if a violation of property boundaries has taken place, and then specify a resolution. If necessary, courts will employ law enforcement to see that justice is administered.  Conflicts between courts will be resolved by using a voluntarily agreed-upon third court.

An anarchist, qua anarchist, is not concerned with the content of law; only with the arrangements under which law is provided. Under an anarchic arrangement, each individual can choose the set of laws he would like to live by. No one is bound to any set of rulers, based on his territorial location, nationality, or anything else. No one is a slave.

What is Libertarianism?

Libertarianism is a political philosophy. Like all political philosophies, it is a system, or set of principles, for allocating property ownership. It provides an answer to the question: who is the rightful owner of X?

Law is the application of political philosophy. All courts must operate according to some political philosophy, since dispute resolution involves, first and foremost, determining who the rightful owner of the disputed property is.

In libertarianism, property can be rightfully acquired only by (a) homesteading, or (b) voluntary exchange. These principles are held to be universal: no-one can rightfully acquire property any other way, for example, by stealing it.

Property is originally created through the interaction of labor and nature. The homesteading principle is that the first owner of the property – the “homesteader” – is the individual who supplied the labor. It is the formation of an objective link between the homesteader and the property that gives him the right to ultimate decision-making jurisdiction over how that property is used, i.e. ownership rights.

Property ownership rights can be transferred from one individual to another by either voluntary exchange or coerced exchange. Libertarians believe that only voluntary exchanges constitute a rightful exchange of property. Involuntary exchanges include murder, rape, slavery, assault, theft, fraud and trespass. Under libertarian law, these activities are outlawed.

Libertarianism can be contrasted with socialism. Under socialism, the first owner of original property is not always the homesteader; the most obvious case being the outlawing of drugs. And some involuntary exchanges are lawful; the most obvious case being taxation.

Socialism is necessarily non-universal; there are different laws for State employees, such as tax collectors, than there are for non-State employees. Most individuals are not allowed to threaten others with violence if they do not pay tribute.

Government is incompatible with libertarianism. A government is a territorial monopolist of law. The only way a government can maintain this territorial monopoly is by aggressing against potential new competitors in the production of law and forcing individuals within the territory from using any other legal system for conflict resolution. Government therefore necessarily violates the libertarian principle that only voluntary exchanges are rightful.

A libertarian, qua libertarian, is concerned with ending acts of aggression, as that term is understood according to libertarian philosophy. Under libertarian law, no individual is allowed to initiate coercive exchanges.

"Fear the Boom and Bust": A Hayek vs Keynes Rap Anthem

The premise: economists F. A. Hayek and John Maynard Keynes are resurrected, and are back to debate the causes of the current financial crisis.  The debate takes the form of a rap.

Economics in One Lesson: Wars, Governments, Price Controls and the Boom-Bust Cycle

Based on the Henry Hazlitt book, this presentation is an introduction to applied economics. Hazlitt’s lesson, to consider what is unseen as well as what is seen, is applied to various situations: broken windows, wars and governments.

The market process for allocating resources is introduced, and the effects of price controls, such as the minimum wage law, on resource allocation is examined.

Finally, the One Lesson and the theory of price controls is applied to the phenomenon of the boom-bust cycle, which is explained as a necessary consequence of government manipulation of interest rates.

This presentation was first delivered in June 2010.  No previous knowledge of economics is assumed.

Two Ways of Getting Rich

How can an individual get rich? There are only two ways:

One way is to steal his way to riches. He can use the “political means”, which is to use violence or threats of violence. People are coerced into giving up their money.

The other way is to persuade people to voluntarily give up their money. This is the “economic means”. This requires the individual to produce something that other people want.

Libertarians reject the initiation of violence or threats of violence, so they reject the “political means”. So in a libertarian society, if somebody is very rich, it must be because he has produced things of great value to other people. There simply is no other way for an individual to become rich.

The “desire to become rich,” usually presented as a bad thing, can be interpreted, in a libertarian society, as the “desire to satisfy the most urgent and important needs and wants of as many people as possible”.

In other words, greed is good, for want of a better phrase, as long as the economic means is used and not the political means.