Year: 2017

The language of the economy: prices

Rick Weber Culture, Economics, Liberty ,

50 Things That Made the Modern Economy is looking for a 51st thing. Below is the email I sent them.

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Price Gouging: Reality vs Fiction

Nicolas Cachanosky Economics , , , , ,

In a previous post I comment on a too common economic fallacy, that a natural disaster is good for the economy because of its alleged impact on GDP. Economic fallacies are not the only misconceptions gaining momentum during a natural disaster, but a confusion between reality and fiction becomes also quite common. The issue of price gouging provides a good example of this situation.

After a natural disaster, the price of certain goods such as water or gas, increases significantly. This is seen as an immoral exploitation by merchants who are taking advantage of the people affected by the natural disaster. Even though in this post I want to comment on another issue, it is worth mentioning that the now limited resources should be allocated to those in most need (rather than, for instance, to whoever happens to be the first one in line.) And unless someone has a crystal ball, there is no way of knowing who is in most need without changes in relative prices.

The mention to reality versus fiction refers to the fact that the critics of price gouging seem to (implicitly) assume that the natural disaster did not occur. It is plausible to assume that an event like this would (1) shift the supply to the left [reduce supply of goods] and (2) shift the demand to the right [increase the demand of goods.] At the usual (or “normal”) price these goods are in serious shortage.

This means that in the event of a natural disaster the option is between (1) having goods at a higher price or (2) not having goods at the “normal” price. This is the new reality. The old and normal reality does not exist anymore. To limit price gouging results in a lower price in the store, but not goods on the shelf. This would not help those in need. The fiction consists in thinking that a larger supply can be secured without an increase in the price (why should we assume supply is horizontal when these goods usually have a low elasticity?) An efficient policy would secure the provision of goods rather than secure a low price without the goods. Reality, rather than fiction, should be the first driver of a policy designed to assist during a natural disaster. As Milton Friedman insisted, a policy is to be valuated by its results (or design), not by its intentions.

The first rule for an efficient policy should be to not get in the way of changes in relative prices. Otherwise help will become erratic and inefficient. It might be more efficient, for instance, to make use of firms specialized in logistics (i.e. firms such as Walmart) and subsidize the demand than start a price control policy. For instance, a tax credit or a check can be sent to those affected by the natural disaster allowing them to pay the now higher prices. Similarly, a subsidy can be given to those firms bringing goods to the damaged areas (who says the government has the monopoly of charity or that the only one who can do it efficiently?) A policy on these lines would be more efficient than interfering with relative prices.

However, some opponents of price gouging seem to be more interested in damaging merchants than in making sure resources will be efficiently allocated among the ones affected by the natural disaster. Those who do not oppose price gouging do so because they have the affected ones first in line. It is not about merchant’s revenue, it is about allocating goods efficiently. Damaging the merchants should not be more important than worsening the situation of those in need.

Declare Peace on North Korea!

Fred Foldvary Current Events, Politics

The United States should offer a peace treaty with North Korea and offer diplomatic relations. The Korean War did not officially end. Let’s end it now.

The chiefs of North Korea have feared an invasion by the USA. They recognize that several heads of countries without nuclear weapons, such as in Lybia and Iraq, were overthrown. It is recognized that nuclear weapons that can be sent to the USA provide a deterrent against an overthrow of the state and even against an assassination of the Korean head of state.

The government of North Korea has evidently convinced the people there that the USA is their enemy and a threat. That propaganda would be less effective if there were a peace treaty.

So the US government should, together with South Korea, China, Russia, and the United Nations, offer to negotiate a peace treaty with North Korea.

The USA has negotiated with North Korea on a stoppage of its nuclear weapons project, but North Korea will not give up its weapons, and negotiations along with economic pressure will not be effective, since their greatest accomplishment has been their nuclear achievements, and the Chinese leaders seek to avoid an economic collapse.

Therefore a peace treaty with North Korea should not seek to end the nuclear status of the regime, but eliminate the deeper problem of mutual fears. The peace treaty would state that the U.S. recognizes North Korea as a sovereign country, and that there will be no invasion.

If the government of North Korea refuses to negotiate a peace treaty, then it will be seen that the hostility is being generated by North Korea, not the USA. The USA should then declare peace unilaterally. With the governments of South Korea and China, the USA would write a peace treaty and they would declare unilateral peace. The US would offer diplomatic relations, and if refused, would appoint an ambassador anyway, who would reside in China.

The US government would then broadcast to the people of North Korea, and send them messages via leaflets and computer files, that the USA has declared peace.

The opponents of a peace treaty could argue that this would leave North Korea with weapons that could reach US territory. But if the North Koreans will refuse to give up their nuclear capability, the peace treaty does not increase the danger. Indeed, the treaty, when agreed to by North Korea, would increase safety by prohibiting North Korea from providing nuclear materials and technology to others.

If North Korea accepts the peace treaty, the US would withdraw its troops from South Korea. Their presence is antiquated, since the threat would be from missiles rather than from an invasion by North Korean troops.

North Korea would gain four advantages from a peace treaty. First, assurance that the US is no longer a potential threat. Second, global diplomatic recognition. Third, removal of US troops from Korea. Fourth, the ability to trade freely with the rest of the world.

If the North Korean regime is not suicidal and seeks to maximize its well being, it would accept a peace treaty. But even if it does not accept a treaty, a unilateral offering would deflate its fears and propaganda.

———————————

This article also appears in http://www.progress.org

No, natural disasters are not good for the economy.

Nicolas Cachanosky Current Events, Economics , , , , ,

Every time there is a natural disaster old economic fallacies make their appearance. And they are usually always the same. In particular, the argument that a natural disaster is good for the economy. This should make little sense. Wealth is not created by destroying things. A natural disaster destroys wealth, doesn’t create it. I doubt anyone affected by a hurricane would argue that he is better off after the natural disaster than before.

The argument that an event such as a natural disaster is good for the economy rests in the positive impact seen in GDP (as is argued) after the natural event. If GDP increases, then the economy is doing better. But this is a misreading of GDP. This variable is a flow of wealth, it is not a stock of accumulated wealth. It is possible that wealth creation (flow) increases at the same time the stock of wealth is decreasing. And this is what happens during a natural disaster.

Imagine that someone’s house caught fire and burns down. Because of this situation, this person decides to start working extra hours to increase his income and be able to buy a new one. The extra hours makes his income (GDP) increase. But his situation is considerable worst because he lost his stock of wealth (remember Bastiat’s broken window fallacy…?). Arguing that a natural disaster (or a war, etc…) is good for the economy is like arguing that this person is better of because he has to work extra hours to recover his loss.

This is just another case of a too common fallacy in economics. We know that if the economy is doing better the result will be better GDP and unemployment indicators. But from observing a better GDP and unemployment indicators we cannot, and should not, conclude that the economy is doing better. More important than observing what is happening to GDP is understanding why is changing its behavior.

It could be argued that one of the problem of the Keynesian view of the world is the focus on what happens to output and unemployment rather than why these variables are moving. Not surprisingly, we get to the conclusion that going to war (or having a natural disaster) would be a good way to achieve full employment.

A short note on ideological neutrality

Brandon Christensen Law, Liberty , , ,

William‘s excellent post on dishonesty reminded me of an equally excellent post by John McGinnis over at Liberty Law Blog on the ACLU and free speech. The post ended, though, with the following sentence:

It would be a tragedy for our nation if the ACLU’s decision begins to dissolve the strong social fabric supporting the ideologically neutral First Amendment.

Ach. There is nothing neutral about the First Amendment. It’s a law based on liberal ideology. The idea of free speech is based on liberal ideology. The other ideologies out there pay great lip service to free speech, but there’s no First Amendment in the post-colonial states of Africa and Asia. Free speech is trumped by an ambiguous form of censorship called “hate speech” in other OECD countries (Western Europe, Australia-New Zealand, Japan). There is no First Amendment in Russia or China or Venezuela.

Liberalism is the only ideology out there that actually encourages rival ideologies to attack it, not with provocative laws but with one specific law that allows all factions the same space for their platform. The First Amendment is not neutral at all; it is instead an aggressive flaunting of liberalism’s staying power and ability to deliver freedom.

When libertarians start thinking of their preferred values as “neutral” or “centrist” they begin to echo the Left, which has been dishonest with itself for the past 45-50 years. That’s a road I’d hate to the movement plod through.

What is going on in Brazil

Bruno Gonçalves Rosi Current Events, Politics , , , , , ,

I’ve been thinking about writing a short essay about some of the things going on in Brazil right now, especially concerning politics and economics, for my English speaking friends. I guess one can get really lost in the middle of so much news, and to the best of my knowledge, some left-leaning journalists are saying quite some nonsense already. So here we go!

President Dilma Rousseff was impeached over a year ago. Her party, the Workers Party (Partido dos Trabalhadores, or PT in Portuguese) is officially a social democrat party, close to the European social democracy tradition, i.e., socialists who want to attain power through a non violent, non revolutionary path. In the end, as it happens with so many big parties, PT has many internal tendencies and in-fighting, but I believe the party can be summarized especially in two tendencies.

On one hand you have cultural Marxists, in the Frankfurt School but even more in the Antonio Gramsci tradition. Many people in PT and other Brazilian socialist parties understood long ago that they had to win a cultural war before they won the political war. And so, these factions are much more interested in feminism, gay rights, and minority rights in general than in anything else. To the best of my knowledge, this is a strategy that backfires somewhat: cultural Leftism is a self defeating philosophy, and so, cultural Marxists are more and more into a witch hunt that damages even themselves. They make a lot of noise, to be sure, but they can’t run a country.

On the other hand, many Brazilian socialists are almost entirely pragmatic. It seems that they forgot about Marxism long ago, and are somehow even convinced of the Washington Consensus. They know basic economics, such as money doesn’t grow on trees and there’s no such thing as free lunch. But they also don’t want to lose face, and most importantly, don’t want to lose position. So, they surely won’t take measures that really shrink the size of the state to a healthy degree.

Dilma’s supporters still say she was the victim of a coup. Of course, she wasn’t. She was impeached with overwhelming evidence of her wrongdoings according to Brazilian law. Other than that, it is hard to believe in a coup where all branches of government agree and the military are not involved in any way. Eventually her supporters sophisticated the argument by saying she was the victim of a “parliamentary coup.” It is nonsense, but if we take it with a grain of salt we can be reminded of something important in Brazilian politics – or politics in general. Dilma was not impeached because of her wrongdoings. Many politicians in Brazil have done similar or worse things than her. She was impeached because she lost support, mostly in the legislative branch. For the wrong reasons (opposition to Dilma), the representatives did the right thing.

One of the problems that Brazil faces today is that the same congress that impeached Dilma for the wrong reasons expects from her successor, Michel Temer, the political favors they used to get from Dilma’s predecessor, Luis Inacio Lula da Silva. But these favors are not cheap. Other than that, even if he is a crook, Temer seems to realize that Brazil can’t suffer any more socialism. In the end Brazil is facing some (sort of) free market reforms, but without really shaking the basis of a state too big to function properly.

The Political is about to disrupt the crypto-currency scene -or at least they say so.

Federico Sosa Valle Current Events , , , , , ,

According to this Financial Times report, Bitcoin is at the verge of a critical decision.

The implications of the chosen terms (“existential crisis,” “decisive leadership,” “political flaw”) are not casual. It looks like the market that crypto-currency had carried from the beginning contain the germ of its own destruction. As in an Escher’s drawing, Bitcoin has unraveled its political strand and its whole existence is, now, dependent upon a moment of decision of the sovereign: the assembly of miners. The decisionist narrative would be fulfilled if the political decision had to be taken by acclamatio instead of voting.

Nevertheless, the decision by acclamation would be still possible: the ones who want “Bitcoin Core” might follow one direction and the other ones, who choose “Bitcoin Unlimited,” might follow their own way. After all, no existential crisis can be solved by voting.

So, which is inside of which? Is the market framed in a system depending upon a political decision of the sovereign? Or does every decision need to be taken inside a spontaneous framework of rules?

We are used to praising Bitcoin for its independence from any political factor: Bitcoin supply depends on a set of rules which allows the public to form expectations about its value with a high degree of probability of proving to be correct.

Taken in isolation, Bitcoin emulates the market. Nevertheless, being independent of political institutions is not enough for being “the market.” The attractiveness of Bitcoin is that it operates in an open system of competition of currencies. In this system, there are many other crypto-currencies, and there might be several variances of Bitcoins as well –in esse or in posse.

Imagine, for example, that Bitcoin effectively splits into Bitcoin Core and Bitcoin Unlimited. Which of the two will prevail over the other? It does not matter. What really matters is that there will be several variances of currencies in competition. The factors that determine the selection of the prevailing currency depends upon a higher level of abstraction that impose an absolute limit to our knowledge.

So, is Bitcoin in an existential crisis? Does a political decision need to be made? Maybe.

But that does not imply that “The Political” will take over the reins of the crypto-currency market. Moreover, opposite political decisions are the linkages which the spontaneous selection process -in this case, of currencies- is made of. In this sense, “Bitcoin Core” and “Bitcoin Unlimited” are attributes of a competitive system and the final prevalence of one variance among other alternatives will not be the result of a deliberate decision but of an abstract process of evolution.

Nazism: left or right?

Bruno Gonçalves Rosi Current Events , , ,

One of the greatest controversies on the Brazilian internet these last few days was to define Nazism as either left-wing or right-wing. I even wrote something about it in Portuguese, and although I really tried my best not to be controversial, I was amazed by how divisive the issue seems to be. So here is my view on this issue, now in English.

Is Nazism a left or right wing political movement? The first thing I believe we need to consider to answer this question is what is right and left? The answer (surprisingly simple in my view) is that right and left are words. Words are signs we use to describe things, but as (I guess) most linguists will say, words don’t have any objective connection to the things they describe. For example, there’s no special connection between the word “cat” and that fluffy animal that drinks milk and chases rats. It is just a convention that in the English language we call that animal “cat,” and not “alligator” or “hot dog.”

However, when we say that there is no objective connection between words and stuff, that doesn’t mean that words are simply random. Words only work in a linguistic context, so there is no use calling a cat anything else if you want to communicate properly. The English language (as any other language, except for Esperanto) was not invented by any specific person. Languages are actually a spontaneous order, something that economists in the Austrian School really enjoy talking about. So, if you want to communicate well, you have to join the party (or the conversation).

With all that said, we need to admit that the word most often used to describe Nazism politically is right-wing. Actually, far-right. The point in discussion (that so many people in Brazil just don’t seem to get) is if this description makes any sense. You see, other groups classified as right-wing are conservatives and liberals (classical liberals, to be more precise). So the question is: why are conservatives, liberals and Nazis all classified as right-wing? What do all these groups have in common? Going back to the example of the cat, there is a reason why you can call both a lion and a tiger a cat (or a feline): they both share several characteristics. It may be just at the eye of the beholder (although evolutionary biologists will say something different), but a lion has much more to do with a tiger than with a frog. So it seems fair to include lions and tigers in a small group where frogs don’t belong. So, the question is: is it fair to include conservatives, classical liberals and Nazis in the same group? Why?

I know there are reasons why all these groups are generally classified together. I know that left and right are terms that go back to the French Revolution. I know how these terms are generally used. All I’m saying (with Friedrich Hayek, David Nolan, and many others) is that we should reconsider the way we typically classify political groups.

Dinosaurs were classified as reptiles. And then people realized they were closer to birds. I guess it was a shock when someone first said that a Velociraptor has more to do with a chicken than with a Komodo dragon, but it seems to me (as an outsider of paleontology) that this is common wisdom now. Similarly, maybe we should have the courage to reconsider the way we classify Nazis. Leftists, of course, won’t like this. But neither do conservatives like being called fascists. Are leftists tasting their bitter medicine? Maybe. But I believe they should give us a good explanation why Nazis should be considered right-wing. I haven’t heard any.

Cycling in Amsterdam

Aside Rick Weber Culture, Economics, Law, Liberty , , ,

I just got back from a week in London and a week in Amsterdam. Probably the most striking thing I encountered was the wonderful dutch cycling culture. Any transit system involves some implicit negotiation between motorists, pedestrians, and others. On Long Island the motorists won. In Amsterdam, cyclists won.

I’m on a bit of a Dutch cycling high, despite only spending about 2 hours on 2 wheels while in Amsterdam. The dutch take their bicycles seriously and they shape their environment to that end. The Airbnb I stayed at had frontage on a bicycle road but no direct access to a motorway. I’m not 100% on this, but I think the Netherlands’ liability laws make the faster vehicle strictly liable for accidents which serves as an implicit subsidy for bikes.

100_4514
A typical Dutch cycle path

Here are some things I like about this culture:

  • The engineering. I really like the way they do bike locks… nearly every bike has a built in lock that disables the rear wheel. Most of these locks also have a chain to lock the bike to a fence, but that chain locks with the same key for the rear wheel.
  • It encourages enough density to get people interacting with each other, but still expands your plausible travel distance. They’ve got a nice balance between closeness and congestion.
  • It’s easier on the environment (excluding the costs of building bikes and bike roads).
  • Light physical exercise feels great.
  • The infrastructure involved in managing bike traffic is pretty minimal. Speeds are slow enough that human judgement works well outside of the busiest areas.

Why should libertarians care? Well, most of them probably have better things to focus on. But those of us living in or near dense cities, this is an example of a way of life that fits nicely with our broader goal of a peaceful, prosperous, liberal order. If Manhattan tried to be more like Amsterdam it could be a huge boon (I think… based on my preferences and zero scientific analysis) to human flourishing.

Social noble lies

Bill Rein Culture, Philosophy , , , , ,

In the Republic, Socrates introduced the “noble lie”: governmental officials may, on occasion, be justified in propagating lies to their constituents in order to advance a more just society. Dishonesty is one tool of the political class (or even pre-political — the planning class) to secure order. This maxim is at the center of the debate about transparency in government.

Then, in the 20th century, when academic Marxism was in its prime, the French Marxist philosopher Louis Althusser became concerned with the issue of social reproduction. How does a society survive from one generation to the next, with most of its moors, morals and economic model still in place? This question was of particular interest to the Orthodox Marxists: their conflict theory of history doesn’t illuminate how a society is held together, since competing groups are always struggling for power. Althusser came up with “Ideological State Apparatuses”: institutions, coercive or purely ideological, that reinforce societal beliefs across generations. This necessarily includes all the intelligence agencies, like the CIA and FBI, and state thugs, like the Gestapo and NKVD, but it also includes the family unit (authorized by a marriage contract), public education and the political party system. “ISAs” also include traditions in the private sector, since for Althusser, the state exists primarily to protect these interests.

It’s rarely easy enough to point to a country and say, “This is the dominant ideology.” However, and here the Marxists are right, it can be useful to observe the material trends of citizens, and what sorts of interests people (of any class) save up money for, teach their children to admire, etc. In the United States, there is a conditional diversity of philosophies: many different strains abound, but most within the small notecard of acceptable opinion. Someone like Althusser might say there is a single philosophy in effect — liberal capitalism — getting reproduced across apparatuses; a political careerist might recognize antagonists across the board vying for their own particular interests. In any case, the theory of ISAs is one answer to conflict theory’s deficiencies.

There is no reason, at any time, to think that most of the ideas spreading through a given society are true. Plenty of people could point to a lesson taught in a fifth grade classroom and find something they disagree with, and not just because the lessons in elementary school are simplified often to distortion. Although ideas often spread naturally, they can also be thrusted upon a people, like agitprop or Uncle Sam, and their influence is either more or less deleterious.

Those outlooks thrust upon a people might take the form of a noble lie. I can give qualified support for noble lies, but not for the government. (The idea that noble lies are a right of government implies some sort of unique power for government actors.) There are currently two social lies which carry a lot of weight in the States. The first one comes from the political right, and it says: anyone can work their way to financial security. Anyone can come from the bottom and make a name for themselves. Sentiment like this is typically derided as pulling oneself up from the bootstraps, and in the 21st century we find this narrative is losing force.

The second lie comes from the left, and it says: the system is rigged for x, y, z privileged classes, and it’s necessarily easier for members of these groups to succeed than it is for non-members. White people, specifically white men, all possess better opportunities in society than others. This theory, on the other hand, is increasingly popular, and continues to spawn vicious spinoffs.

Of the two, neither is true. That said, it’s clear which is the more “socially useful” lie. A lie which encourages more personal responsibility is clearly healthier than one which blames one’s ills all on society and others. If you tell someone long enough that their position is out of their hands because the game is rigged, they will grow frustrated and hateful, and lose touch with their own creative power, opting to seek rent instead. Therefore one lie promotes individualism, the other tribalism.

Althusser wrote before the good old fashioned class struggle of Marxism died out, before the postmodernists splintered the left into undialectical identity politics. God knows what he would think of intersectionality, the ninth circle in the Dante’s Inferno of progressivism. These ideas are being spread regardless of what anyone does, are incorporated into “apparatuses” of some sort, and are both false. If we had to choose one lie to tell, though, it’s obvious to me the preferable one: the one which doesn’t imply collectivism in politics and tribalism in culture.

BC’s weekend reads

Brandon Christensen Links , , , , , , , , , , , , ,
  1. Barry has a book review of Nietzsche’s political thought in the Los Angeles Review of Books!
  2. (check out Barry’s 2014 NOL post on Nietzsche’s contributions to the liberty canon)
  3. a good analysis on the Arab cold war between 2 sets of American allies
  4. a great analysis on the Kurds, the Yazidis, and Turkey
  5. the Zanzibar-North Sea swap
  6. walruses, the Arctic, and science

Lunchtime Links

Brandon Christensen Links , , , , , , , , , , ,
  1. Trophy-taking and dismemberment as warfare strategies [pdf]
  2. optimally vague contracts and the law [pdf]
  3. Germanic and Carthaginian republicanism
  4. traditional resurgence in tropical Africa [pdf]
  5. crisis bureaucracy: homeland security and the political design of legal mandates [pdf]

Inventions that didn’t change the world

Kevin Kallmes Books, Culture, Economics, History, Law, Liberty, Politics , , , , , , , ,

Have you ever learned about an amazing invention–whether it was the Baghdad battery or the ancient Roman steam engine or Chinese firecrackers–and wondered why it didn’t do more to change the world? In this podcast, we examine a selection of curiosities and explore hypotheses for why their inventors didn’t use them to full effect.

We move VERY quickly through a range of fascinating examples and hypotheses, and therefore leave a lot up to discussion. We hope to see your thoughts, feedback, and additions in the comments section!

For any invention that you want to learn more about, see the links below:

Knossos’ toilets

In the 2nd millennium BC, a “palace” (now thought to be a building that served as administrative, trade, and gathering hub) had running-water toilet flushing. Much like the Roman Cloaca Maxima, likely a HUGE public-health benefit, but basically died out. Does this show that military protection/staving off the “Dark Ages” was the only way to maintain amazing inventions?

Link: http://www.nature.com/news/the-secret-history-of-ancient-toilets-1.19960;

The Nimrud lens

Whether it was a fire-starter, a magnifying glass, or (for some overeager astronomy enthusaists), the Neo-Assyrian ground-crystal Nimrud lens is an invention thousands of years out of place. While the Egyptians, Greeks, and Romans all used lenses of different sorts, and glass-blowing was certainly popular by the 1st century BC in Roman Egypt, no glass lenses were made until the Middle Ages and the potential scientific and engineering uses of lenses–that can hardly be understated even in their 16th-to-18th-century applications–had to wait another couple millennia. Many devices like the Baghdad battery and Antikythera device are heralded for their possible engineering genius, but this seems like a simple one with readily available applications that disappeared from the historical record.

https://en.wikipedia.org/wiki/Nimrud_lens

Hero of Alexandria’s steam engine

In the 1st century AD, Hero was a master of simple machines (that were mostly used for plays) and also invented a force pump, a wind-powered machine, even an early vending machine. However, he is likely most famous for his Aeolipile, a rotating steam engine that used heated water to spin an axle. The best attested use of this is for devotion to the divine and party tricks.

https://en.wikipedia.org/wiki/Aeolipile

The ancient mechanical reaper

Ancient Gallo-Romans (or just Gauls) invented a novel way of grain harvesting: rather than using sickles or scythes, they used a mechanical reaper, 1700 years before Cyrus McCormick more than tripled the productivity of American farmers. This antiquated device literally but the cart before the oxen and required two men to operate: one man to drive the beasts, and another to knock the ears off the stalk (this reaper was obviously far less sophisticated than McCormick’s). This invention did not survive the Volkswanderung period.

http://www.gnrtr.com/Generator.html?pi=208&cp=3

http://reapertakethewheel.blogspot.com/2013/03/impacts-of-invention.html

Note: the horse collar (which allowed horses to be used to plow) was invented in 1600-1400 BC in China AND the Levant, but was not applied widely until 1000 AD in Europe. https://en.wikipedia.org/wiki/Horse_collar.

Inoculation

Madhav, an Indian doctor, compiled hundreds of cures in his Nidana, including an inoculation against smallpox that showed an understanding of disease transmission (he would take year-old smallpox-infected flesh and touch it to a recently made cutaneous wound). However, the next 13 centuries did not see Indian medical understanding of viruses or bacteria, or even copied techniques of this, development. https://books.google.com/books?id=Hkc3QnbagK4C&pg=PA105&lpg=PA105&dq=madhav+indian+smallpox+inoculation&source=bl&ots=4RFPuvbf5Y&sig=iyDaNUs4u5N7xHH6-pvlbAY9fcQ&hl=en&sa=X&ved=0ahUKEwic8e-1-JXVAhUp6IMKHfw3DLsQ6AEIOjAD#v=onepage&q=madhav%20indian%20smallpox%20inoculation&f=false

At least, thank god, their methods of giving nose jobs to those who had had their noses cut off as a punishment survived: https://en.wikipedia.org/wiki/History_of_rhinoplasty

The Chinese:

List of all chinese inventions:

https://en.wikipedia.org/wiki/List_of_Chinese_inventions#Four_Great_Inventions

Gunpowder

Gunpowder was discovered by Chinese alchemists attempting to discover the elixir of life (irony, no?)

https://www.thoughtco.com/invention-of-gunpowder-195160

https://en.wikipedia.org/wiki/Four_Great_Inventions

(maybe a good corollary would be Greek fire, which was used effectively in naval warfare by the Byzantines, but which was not improved upon and the recipe of which is still secret: https://en.wikipedia.org/wiki/Greek_fire)

Printing

The Chinese invented the printing press possibly as early as the 6th century. However, unlike the explosion of literacy seen in much of Europe (particularly Protestant Europe–see our last podcast), the Chinese masses never learned to read. In fact, in 1950 fewer than 20% of Chinese citizens were literate. Compare this to Europe, where some societies saw literacy rates of as high as 90% (Sweden, Male population) in some societies within a few centuries of the introduction of the printing press. Why? There may be several reasons–cultural, religious, political–but in our opinion, it would have to be the characters: 100,000 blocks were needed to create a single set.

http://www.nytimes.com/2001/02/12/news/chinas-long-but-uneven-march-to-literacy.html

https://en.wikipedia.org/wiki/History_of_printing_in_East_Asia

They also invented pulped paper by the 2nd century BC: https://en.wikipedia.org/wiki/List_of_Chinese_inventions.

The compass

Invented by 200 BC for divination and used for navigation by the Song dynasty; despite this and the availability of easily colonizable islands within easy sailing distance, the Chinese did not colonize Indonesia, Polynesia, or Oceania, while the Europeans did within the century after they developed the technology and first sailed there.

https://en.wikipedia.org/wiki/History_of_the_compass.

The rudder

While they did not invent the rudder, they invented the “medial, axial, and vertical” sternpost rudder that would become standard in Europe almost 1,000 years before it was used in Europe (1st century AD vs 11th century).

Natural gas

The Chinese discovered “fire wells” (natural gas near the surface) and erected shrines to worship there.

https://link.springer.com/referenceworkentry/10.1007%2F978-1-4020-4425-0_9568

They even understood their potential for fuel, but never developed beyond primitive burning and bamboo piping despite having advanced mining techniques for it by the 1st century BC.

Chinese miscelleni:

Hydraulic powered fan: https://en.wikipedia.org/wiki/Fan_(machine)#History

Cuppola furnace for smelting and molding iron: https://en.wikipedia.org/wiki/Cupola_furnace.

Coke as a fuel source: https://en.wikipedia.org/wiki/Coke_(fuel).

Belt-drive spinning wheel: https://en.wikipedia.org/wiki/Coke_(fuel).

The Precolumbian wheel

The pre- and early Mayans had toys that utilized primitive wheels, but did not use them for any labor-saving purpose (even their gods were depicted carrying loads on their backs). This may have been because scaling up met with mechanical difficulties, but the potential utility of wheels in this case with a bit of investment literally sat unrealized for centuries.

https://tcmam.wordpress.com/2010/11/11/did-pre-columbian-mesoamericans-use-wheels/

The Tucker:

http://www.smithsonianmag.com/history/the-tucker-was-the-1940s-car-of-the-future-135008742/

The following book contained some of our hypotheses:

https://books.google.com/books?id=ynejM1-TATMC&pg=PA399&lpg=PA399&dq=roman+and+greek+labor-saving+devices&source=bl&ots=BI6GVGTrxC&sig=8ZJqirOVUyjH7TNq0fcW6UUPn1k&hl=en&sa=X&ved=0ahUKEwj55O7395XVAhVqwYMKHSb2Dy4Q6AEIKTAB#v=onepage&q=roman%20and%20greek%20labor-saving%20devices&f=false

 

The rest of our hypotheses were amalgamated from our disparate classes in economics and history, but none of them are our own or uncommon in academic circles. Thanks for listening!

Some thoughts on the ivory tower; part 1: discrimination

Michelangelo Landgrave Comments, Culture , ,

I entered academia in 2009 when I started my bachelor’s degree and began graduate studies in 2014 when I entered a master’s program. I have been in the ivory tower in some form for almost a decade. Others have spent much more time in the tower than I, but I am hardly a newcomer. I hope then that I can offer thoughts on discrimination and mental health in the ivory tower.

In the past few years I have noted an increased self-aware discussion on the lack of diversity, both in terms of phenotype and ideology, in the ivory tower. The tower is full of center-left white men. I have seen various formal (e.g. #womenalsoknowstuff ) and informal groups groups advocate for greater inclusion in the tower. For the record there are non-leftist groups involved in this as well. CU Boulder has a program to increase conservative intellectuals. The Institute of Humane Studies (IHS) essentially serves to advocate for classical liberals in the tower. 

There is nothing wrong with these goals. Women also knows stuff tries do this by advertising the work of female scholars. IHS does it by inviting classical liberals to book discussions – and providing beer. Both approaches sound sensible to me. My concern is that ultimately the pipeline isn’t being fixed. Not really. Both approaches help those who managed to enter, at minimum, graduate school but do little to help solve more structural reasons for why there respective groups are rare in the tower.

Why are there so few women and classical liberals (and especially so few classical liberal women!) in academia? It’s partly cultural and partly institutional.

Minorities get made fun of in academia. Academics like to think of themselves as cosmopolitan, but it’s a big lie. A recent undergrad thesis by a Berkeley student looked at misogynistic discussions on an online forum frequented by economists. I disagree with the research design of the paper, but I believe the general argument that the tower is filled with misogyny. I also believe it’s filled with dislike for conservatives, Christians, atheists, whites, blacks, Arabs, Chinese, etc.

I don’t think the tower is unique in this. Human beings divide themselves by groups and I don’t see why that will ever change. I think the academy is just a bit whiter and a bit more lefty because of sorting effects. You can see this happening even within the tower. Classical liberals sort into economics – how many classical liberal anthropologists do you know? Not counting NoL’s chief editor? Some minorities sort into ethnic studies. How many black game theorists do you know? Native American psychometricians?

What can we do? I’m not sure. We can improve the pipeline so that grad students, and eventually faculty, get more diverse. However I suspect the sorting problem will remain. Superficially we will have more diversity, but is it really diversity if we’re sorted by discipline and subfields? Should we force new classical liberals to enroll in sociology grad programs? I don’t know. Maybe we should give up on diversity all together and focus on abolishing the state. Maybe? Who knows? What do you  all think?

By the way if you want to know what true cosmopolitanism is, visit an inner city. True cosmopolitanism is seeing blacks, Mexicans and Koreans eating pupusas made by a Honduran. Everything else is a GAP commercial concoted by HR people.

Human Action, Ch. 1

Bill Rein Philosophy , , ,

Well, I finally started reading Human Action. One connection stood out to me from the first chapter. 

First, there’s much more attention paid to fundamental philosophy than I expect from economic treatises. This is understandable given that Mises felt he had to set the stage — sparring, as he says, with the irrationalists, polylogists, historicists, positivists, behaviorists, and other economists within the youngest science. Every undergrad, cracking open Hobbes’ Leviathan, is startled to find lengthy remarks on human cognition in what they thought was only a work of political philosophy; this was a similar experience. 

There are noticeable allusions between von Mises and pre- and post-Tractatus Wittgenstein. Both Austrians and both Ludwigs, the economist writes that “It is impossible for the human mind to conceive logical relations at variance with the logical structure of our mind. It is impossible for the human mind to conceive a mode of action whose categories would differ from the categories which determine our own actions” (p. 25). Similarly, for the philosopher, the logical structure of thought (and language) was a central theme of Tractatus Logico-Philosophicus; one of the young Wittgenstein’s conclusions was that some (ethical, aesthetic, metaphysical) postulates go beyond the limits of language and, when crunched into such human linguistic straightjackets, create sheer nonsense (leading to such maxims like, “What can be said at all can be said clearly…”) (TLP, §7).

Each Ludwig, of course, limited their inquiry to the human mind, discovering, like Kant, universal conditions of rational beings (or so I garner so far from Mises). 

Another methodological point in common. Ludwig von Mises, in section The Alter Ego, remarks on “the ultimate given,” an idea which, I believe, is unpopular in contemporary epistemology. The empirical sciences must reach final points of inquiry, upon which their tools fail to produce deeper insight. This is so because, to Mises, there are only “two principles available for a mental grasp of reality, namely, those of teleology and causality” (p. 25): teleology belonging to purposeful behavior, and causality to non-purposive objects of study. The former, applied ad infinitum, must stop at the unmoved mover, and the latter can only invoke an infinite regress. This point is important for deploying praxeology as a deductive science.

This doesn’t seem like a new insight, but it’s also one that Wittgenstein touches upon in a different way in Philosophical Investigations, writing in the first segment “Explanations come to an end somewhere.” The use of language in daily life does not imply ultimate, elucidated concepts between speakers; we never ask for these and likewise we do not need them to communicate. Reaching deeper into shared insight also leads to confusion; we talk of objects and ideas as ‘wholes’ and ‘composites,’ but these categories are not unambiguous. Wittgenstein situates the sense of concept-analysis only within a language game: “The question ‘Is what you see composite?’ makes good sense if it is already established what kind of complexity — that is, which particular use of the word — is in question. If it had been laid down that the visual image of a tree was to be called ‘composite’ if one saw not just a single trunk, but also branches, then the question ‘Is the visual image of this tree simple or composite?’, and the question ‘What are its simple component parts?’, would have a clear sense — a clear use.” So therefore, “To the philosophical question: ‘Is the visual image of this tree composite, and what are its component parts?’ the correct answer is: ‘That depends on what you understand by “composite”.’ (And that is of course not an answer but a rejection of the question.)” (PI, §47).

In the future I might post on Mises’ short use of terms like “being,” “change,”and “becoming,” which he uses in a sense reminiscent of Parmenides.

Wittgenstein, Philosophical Investigations. G. E. M. Anscombe trans.

von Mises, Human Action. Scholar’s Edition. Ludwig von Mises Institute.