Author: Brandon Christensen

Property Rights: A Human Universal

Brandon Christensen History , ,

I have been reading a lot about property rights among the San (“Bushman”) in southern Africa for a little research project I am doing, so bear with me as most of my posts over the next little while will deal with property rights in the non-European world.

From the Freeman come this article by co-blogger Michael Adamson:

By any criterion, the economic and social standards of living are lower among Native Americans than among the balance of the U.S. population. Unemployment on or adjacent to reservations fluctuates around 40 per cent. Of some 750,000 Native Americans on reservations, 75 per cent earn less than the national average. Leading causes of death among Native Americans are accidents, heart disease, malignant neoplasms, and cirrhosis of the liver, all far above national averages and a significant proportion of these related to alcohol abuse. Drug abuse, mental illness, and obesity are major health problems. Tuberculosis cases are 4.5 times the national average and deaths from the illness are 9.5 times as frequent. Suicide is more than twice as likely among Native Americans. Their life expectancy is about five years below the average American’s and infant mortality rates are 25 per cent higher.

While such facts may illustrate the plight of the Native American, they do not explain why such conditions exist […]

The mission of the Bureau of Indian Affairs is to act as the principal agent in carrying out (1) the government-to-government relationship between the United States and Federally-recognized Indian tribes and (2) the responsibilities of the United States as trustee for the property it holds for tribal units.

Oops. You can probably guess where this is going. Do read the whole thing.

Bureaucracy: Yet Another View

Brandon Christensen History, Links ,

When I write now about my naval period, I feel almost forced to apply a bit of organizational analysis to my memories. It’s a slightly disturbing experience because being a small cog in a bureaucratic organization, a state organization at that, unexpectedly fails to evoke bad feelings.

It’s disturbing because life and work within a bureaucracy is at the antipodes of libertarian utopian imagery. It’s disturbing, additionally, because government routinely acts as the principal agent of routine state oppression in societies with a constitutional government such as the US. This malaise is also an opportunity. I believe that people who think of themselves as libertarians, even those with a mere libertarian bent, don’t spend enough time thinking about disconfirming evidence, about experiences that run counter to their main existential choices. Here is a brief analysis, one that may speak a little to the issue of why some people are attached to bureaucracies in spite of their libertarian leanings.

Thus write Jacques Delacroix in Liberty magazine. Do read the whole thing. Liberty, by the way, is where I first came across Dr. Delacroix’s writings. I was living in Santa Cruz and I have always had a weird obsession with foreign-sounding libertarians, so when I stumbled across Liberty‘s pages, Dr. Delacroix’s writings were some of the first that I read.

You can find more of Dr. Delacroix’s writings in Liberty‘s publication by checking out the newly-renovated ‘recommendations’ section here on the blog!

What Good Are Mathematical Models for the Science of Economics?

Brandon Christensen Economics, Links , , ,

This question comes from co-blogger Warren Gibson’s piece in Econ Journal Watch titled “The Mathematical Romance: An Engineer’s View of  Mathematical Economics”:

Mathematics can be very alluring. Professional mathematicians speak frequently of “beauty” and “elegance” in their work. Some say that the central mystery of our universe is its governance by universal mathematical laws. Practitioners of applied math likewise feel special satisfaction when a well-crafted simulation successfully predicts real-world physical behavior.

But while the mathematicians, some of them at least, are explicit about doing math for its own sake, engineers are hired to produce results and economists should be, too. It’s fine if a few specialists labor at the outer mathematical edge of these fields, but the real needs and real satisfactions are to be found in applications.

Western civilization has brought us an explosion of human welfare: prosperity, longevity, education, the arts, and so on. We very much need the wisdom that economists can offer us to help understand and sustain this remarkable record. What good are engineers’ accomplishments in crash simulations if the benefits are denied to the world by trade barriers, stifling regulation, congested highways, or bogus global warming restrictions? What can mathematical economics contribute to such vital issues?

You can read the whole thing here (it’s also in the newly-renovated ‘recommendations’ section). Highly, uh, recommended! Mathematics is an important aspect of economics, I think, but Dr. Gibson and other Austrian critiques are more focused on the models that economists create rather than all of the wonderful data that can be quantified for calculation purposes.

I may be wrong, and I hope that my co-bloggers or others will correct me if I am, but either way Dr. Gibson’s critique of the mathematical models employed in the economics profession needs another good look.

Ron Paul’s Legacy

Brandon Christensen Current Events, Liberty, Politics , , ,

Ron Paul will not get to speak at the GOP convention, but his legacy will hard to miss over the next decade of American politics. His son is now a Senator in Kentucky, and his Audit the Fed bills have lots of bi-partisan support (in the House anyway; Senators, for some strange reason, seem to like the Federal Reserve an awful lot).

His foreign policy, which initially attracted me to libertarian ideas, is the most important legacy, however. I can tell because the GOP loathes it so much that they won’t give Congressman Paul the time of day they know they need for his support.

From Foreign Policy: Continue reading →

Life Under Fatwa

Brandon Christensen Current Events, History, Links , , , , , ,

I did once visit Iran when I was 21 years old, during the time of the shah. It was wonderful. I had just graduated from university, and such was the world at that time, 1968, that I was able to drive with a friend from London to South Asia across the world. I mean, try driving across Iran and Afghanistan now! I remember it being a very cosmopolitan, very cultured society. And it always seemed to me that the arrival of Islamic radicalism in that country, of all countries, was particularly tragic because it was so sophisticated a culture — which is not to defend the shah’s regime, which was appalling. But it was one of the tragedies of history that an appalling regime was replaced by a worse one.

From Salman Rushdie.

At first I found his praise for the Obama administration to be typical of Left-wing establishment figures, but then I remembered that Rushdie is an Indian and had probably had to deal with racist legislation in one form or another while growing up. While the period of colonialism (roughly coinciding with the end of the Napoleonic Wars and the beginning of World War I) did indeed open up more places to markets, the Jim Crow-like legal barriers that European states erected no doubt helped to foster part of the suspicious climate that now pervades most globalization skeptics worldwide.

This is a shame for two reasons: Continue reading →

Around the Web

Brandon Christensen Current Events, Links , , , , , , ,

How savage has European austerity (spending cuts) been?

An Invisible Nation: the Gulf’s Stateless Communities

The Moral Limit of Markets Debunked

Keynesian Obstinate Ignorance

 

From the Comments: the Unemployment Rate

Brandon Christensen Current Events, Economics , , , , , , , ,

Dr. Gibson has won the much-cherished gold star I had offered in a previous comment. My question had to do with the green dot in this graph, and Dr. Gibson explained it to perfection. He writes:

The widely followed U3 unemployment rate, as shown in the figure, is the number of unemployed divided by the labor force. The labor force excludes discouraged workers. The labor force participation rate is the labor force size (employed & unemployed) divided by the population. The green dot shows what the U3 rate would be if that ratio had stayed the same since Jan. 2009.

The U6 statistic counts discouraged workers as unemployed. That rate is currently around 15%.

See also: Unemployment: What It Is

From the article Dr. Gibson directs us towards comes some other important information:

Government policies contribute to unemployment above and beyond natural unemployment. The most notorious of these policies are minimum wage laws. These laws make it illegal, effectively, for low-skilled workers to accept employment. Anyone who cannot generate $8 worth of production per hour cannot expect to be paid more than $8. Such unfortunate people might be productive at $6 per hour but are forbidden to accept employment at this rate and are instead condemned to joblessness and all its attendant miseries. This burden falls most heavily on black teenagers, whose unemployment rate (based on those seeking work and excluding those who are in school) is well over 40 percent. The benefits accrue mainly to slightly higher-skilled workers, who have climbed onto the metaphorical ladder leading to better jobs and who are shielded from competition from those excluded by minimum-wage laws […]

Labor unions, as voluntary associations bargaining freely with employers, are unobjectionable. They did a lot of good in the past when working conditions in many places were pretty bad. But now they are granted special privileges by law—basically the privilege to engage in violent or coercive activities. The result is often wage agreements that are above market-clearing levels. Those left out are of course unemployed.

While labor unions can boost their members’ compensation at the expense of non-union workers, higher wages generally and higher living standards are due mainly to increased productivity, which in turn depends on high levels of capital investment. People are more willing to save and invest when they have confidence in the future, and that confidence comes from respect for property rights.

For more on minimum wage laws, see Bad Idea of the Year.

From the Comments: Keynesian Economics and the Stimulus Bill

Brandon Christensen Comments, Current Events, Economics, Politics , ,

A recent brouhaha has erupted in the comments thread of Dr. Delacroix’s post on Obama’s bad economic policies. Now, to be sure, the bad economy cannot be put on Obama’s shoulders alone. All he did was sign the stimulus act into law, after all, and I doubt John McCain would have vetoed it.

Let us also not forget about the two foreign wars that George W. Bush charged to the republic’s credit card, either. With that being said, I thought another economic chart would do readers of this blog a favor. From AEI’s blog comes this:

Ta-dah! Utter economic failure.

(h/t Steve Horwitz)

Glass-Steagall and Deregulation: What Went Wrong?

Brandon Christensen History, Law , , , , ,

Nothing, really. Consortium members Warren Gibson and Jeffrey Rogers Hummel write in the Freeman on Glass-Steagall and what its repeal in the 1990’s meant for the economic crisis that began in 2008:

The timing of the repeal of Glass-Steagall makes this deregulatory move a convenient scapegoat for the financial crisis. But the crisis began with the housing collapse, a result of government encouragement of unsound lending practices. Financial firms took too much risk with mortgage-backed securities, in part because of moral hazard engendered by government guarantees and partly because bond rating firms were not as independent as was once thought. The limited liability that the investment banks gained when they became corporations may also have amplified moral hazard. There is no good reason to believe that Glass-Steagall, had it remained in effect, would have prevented any of these problems.

I highly recommend this piece. Lots of good history behind the law as well as a very clear explanation of the different types of banking services, what they do, and how they are created.

Fascism and Socialism: What’s the Connection?

Brandon Christensen Liberty ,

A commentator on EconLog has a great, succinct comment in a thread produced by economist David Henderson’s post on fascism and communism. Long explains the difference between the two:

I think it has always been clear among most objective historians that there is little difference between fascism and communism. My take has always been that “fascism” was the word that leftists use to smear rightism as potentially dictatorial. Rightism *is* potentially dictatorial, but the end result is no different than dictatorial leftism.

That’s one reason among many that I like Mises’ terming fascism “socialism of the German pattern,” and communism “socialism of the Russian pattern.” It’s linguistically a little clunky, but still makes for a great terming of the concepts.

Jacques Delacroix has gone to great lengths to explain this concept as well here at NotesOnLiberty. For more on the similarities (and confusion) between fascism and communism, see Fascism Explained and How ’bout Communism?

Plato, Rousseau and All That Jazz

Brandon Christensen History, Law , , , , , , ,

Rousseau maintains this ideological preference consistently throughout his economic thought. We have seen that he was distressed that the possibility and actuality of shifting occupational roles would lead to inauthenticity. Change and social mobility were so psychologically destructive in his view, that he came to praise the caste system of ancient Egypt because it forced sons to follow their fathers’ occupations.

From Bill Evers in the Journal of Libertarian Studies. The title is “Specialization and the Division of Labor in the Social Thought of Plato and Rousseau.” (h/t Walter Block)

On a side note (and completely unrelated as well), this is possibly the best hip-hop album of all-time. Enjoy!

Department of Oops!

Brandon Christensen History, Law , , , , , ,

One of the most influential anthropologists to my own way of analyzing global society and how it interacts with each other is Edwin Wilmsen, whose book Land Filled with Flies: A Political Economy of the Kalahari has deeply influenced my thoughts about intercultural (“foreign”) relations (the other two most influential books on me so far have been Peace Pact… and 1491…). I am currently doing a research project and came across the following sentence, which deserves to be deeply pondered by anthropologist and layman alike:

[…] those who have been responsible for formulating and implementing policy towards [the San] have relied on a functionalist equilibrium model derived from ethnography grafted onto a residual colonial construction of a static San social condition […] A key element in this ideology [governing Botswana policy towards the San] is the mystification of [San] uniqueness, a condition that [has] been imposed on them by other, hegemonically dominant ethnic groups.  Among these hegemonically dominant groups – I urge that we not forget this point – are ethnographers, whose work serves as scientific sanction for this mystification.

Wilmsen is a Marxist, and Land Filled with Flies… was written before the collapse of the Berlin Wall, but I nevertheless find his work extremely satisfying. Can anybody see why this is such a powerful critique of collectivism? Admittedly, I have depraved this post of its rich context, but I think readers here at Notes On Liberty are smart and thoughtful enough to find some gems among this deceptive-looking rock pile.

An online profile of Edwin Wilmsen.

Economic Growth in Europe: the Longer View

Brandon Christensen Current Events, Economics, Links , , , , ,

Economist Tyler Cowen has a post up on who has gained most from the Euro (as measured by state), but the economist Angus puts things into perspective:

Ireland, Spain, Portugal and Greece were all growing fast relative to Germany (and France which is not on the graph) well before the introduction of the Euro. Ireland and Spain take off somewhere around 1990 and the intro of the Euro in 2000 does not speed up their trajectory. Portugal actually falls further behind Germany in the Euro era. Greece is the only country of these 5 whose catch-up to Germany accelerates with the intro of the Euro.

Two quick thoughts:

  1. Woah! Look at Ireland!
  2. I’ll bet the acceleration of growth in the 1960’s had to do with the end of World War 2 and its rebuilding efforts.

Taking a broader historical view really puts things into perspective. If the Euro was not the catalyst for the economic growth of the 1990’s, what was? My guess is that the elimination of tariffs and labor restrictions between European states led to the growth. If the Eurozone had not implemented a central bank I think we wouldn’t be looking at all of the political problems now associated with the region.

Angus (who works at Oklahoma University) got his statistics from here. I highly recommend using it in your own studies as well.

Department of Huh?

Brandon Christensen Liberty ,

The dialectic between pragmatics and metapragmatics is the way in which

explicit metapragmatic registers instantiated in metapragmatic discourse encapsulate ideologies of language use and play an obvious role in the institutionalization of discursive mechanisms of society.

This is from Michael Silverstein, a linguistic anthropologist and somebody who I have to read for a degree requirement. Life could be worse, I guess…

North Dakota or Bust!

Brandon Christensen Current Events, Economics, Links , , ,

An excerpt from co-editor Fred Foldvary’s Progress Report:

In theory, productive public goods increase land rent because the supply of land is fixed. There can also be a rise in wages from more public goods, but that would be temporary. If labor becomes more productive in a location, that attracts labor from areas where wages are lower for the same skills. The increase in the labor supply will drive wages back down to normal. But the total supply of land in some region cannot expand, so the increase in rent sticks.

Just as territorial benefits raise land values, costs to landowners reduce the rent they keep, and so capitalize land value down. If the public goods are paid for by public revenue from land rent or site values, then the rise in land values would be limited. If governmental public goods are paid by labor and enterprise, then the rentalization and capitalization are implicit subsidies to landowners, at the expense of taxed labor and enterprise.

Economists have found evidence of the generation of higher land values from greater public goods. We now have an excellent case study: North Dakota.

Read the whole thing here. I’ve never been to North Dakota, but if it’s anything like South Dakota I might be tempted to settle there someday. Just kidding! California is the best state to live in, even with our terrible, fascistic-like government.

I am still having trouble wrapping my head around the concept of land value taxing, though. Someday I’m going to have to spend a couple of days with a copy of Henry George’s Progress and Poverty and see what I can figure out.