Fred Foldvary

More on Secession

Brandon Christensen Links , ,

Secession is not just a means of creating new countries, but can become a central element in governance in general. The general principle is that at any level of government, lower-level governments or individual residents may secede in part or in whole.

This is from a paper by our own Dr. Foldvary. Do read the whole thing. One thing I get tired of dealing with is the “confederate!” slur that is inevitably hurled my way when I bring up secession as a legitimate political function. In other parts of the world, secession is just as hotly debated (if it is not a forbidden subject to talk about).

I think there is a good case to be made that secession would get better reception once a larger (and lighter) federal or confederal system is place, and then allowing for mechanism of decentralization to happen. This way the polities under each system are still bound to each other economically or in some small political way, and would thus likely keep the threat of violence to a minimum.

Dr. Foldvary’s fascinating paper touches on this, too. Just read it!

Sex and Economics (And Karl Marx Too!)

Brandon Christensen Economics , , , , ,

The concept of economic reproduction is emphasized in the Marxian school of economic thought. In Marxist theory, the conditions for production are continuously re-created as a circular flow. The concept of the circular flow of both goods and of factor-inputs was first developed by the French economists of the 1700s, who called their theory of natural economic laws “Physiocracy.” The factors or categories of inputs are land, labor, and capital goods.

From co-editor Fred Foldvary. Do read the whole fascinating article. Many conservatives in the US (as well as libertarians) don’t give Karl Marx the time of day he deserves in order for thoughtful, polite discourse to take place. Many on the Right decry (and rightly so) the various strawmen that Leftists erect when attacking the proponents of private property, personal wealth and international trade, but are we any better when it comes to debunking Leftist arguments? Continue reading →

Election Reform: a Modest Proposal

Warren Gibson Politics , , , , ,

Texas and other states have passed laws requiring voters to present valid ID at their polling place.  How could this be controversial?  These days we have to present ID to get on Amtrak, pick up mail at the post office, transact with a bank teller, etc., etc.  Is proper ID any less important for voting?  But a court recently struck down the Texas law saying it impacts minorities disproportionately.  Hummph.  If laws against aggravated assault affect minorities disproportionately should those be overturned also?

But why bother about this issue?  There surely is some voter fraud happening, but how much does it matter?  The real problem with democracy is simply the results.  The worst get on top, as Hayek put it, Exhibit A being, of course, the Sewer Rat in the White House.  As the electorate has broadened, starting with white male landowners at the Founding all the way down to today’s situation where anyone with a pulse who is at least 18 and claims to be a citizen can vote, and with direct election of senators in between, the quality of elected officials has gone steadily downhill.  Barack Obama!  Harry Reid!  Mike Huckabee!  Nancy Pelosi!  Compare this crew with George Washington, James Madison, Thomas Jefferson.  Are you sick at your stomach yet?

Herewith a modest reform proposal:

  1. Raise the voting age to 30
  2. Disqualify all government employees and all recipients of any government entitlement: social security, medicare, etc.
  3. Adopt a stiff qualification exam, to be re-taken every five years
  4. Mandate a poll tax sufficient to cover election expenses

Let’s now consider objections one by one:

Objection: people would feel disenfranchised. People who lost their vote would be bummed, no doubt, but they would still have the prospect of earning a vote to aspire to.  Voting would be seen as a privilege to be earned, and the quality of votes cast would skyrocket as would the quality of campaign rhetoric.

So as not to cause too much upset, the voting age could be raised gradually and the poll tax raised in steps.

Objection: corruption. It might be worthwhile for special interests to track down individual voters and offer them bribes or intimidation.  But if the voter roles were shrunk by a factor of a thousand, for the sake of argument, that would still leave a hundred thousand or so voters nationwide.  That leaves quite a bit of effort for lobbyists and other crooks to track them all down.

Besides, corruption is proportional to the amount of power that resides with government.  Regulation of lobbyists, campaign reform and all that will never mean anything as long as so much money and power are at the disposal of politicians.  My voter reform proposal will lead to a drastic shrinkage of government and thus drastically reduced rent-seeking opportunities and incentives.

Furthermore, as things stand with campaign promises.  How much worse would outright cash bribes be?

Objection: bias. Outcomes would be skewed toward the viewpoints of the eligible voters, which would not be representative of the general population.  Exactly!  The whole point is to restrict voting to an elite who can think and act rationally and not be swayed by the sort of demagogic appeals we hear from the aforementioned politicians and their ilk.

Is this idea likely to gain traction?  Not any time soon, but it’s fun to speculate.  An interesting alternative is Fred Foldvary’s “cellular democracy.”  Perhaps he’ll be moved to post that idea here.

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.

Around the Web: Consortium Edition

Brandon Christensen Links , , , , , , , , , , , , ,

Co-editor Fred Foldvary points out that slavery is alive and well today.

Historian Michael Adamson compares the debacle in Iraq to South Vietnam rather than Germany or Japan.

Mark Brady gives us a well-written, brief biography of a little-known (and hence important) individual in the liberty movement.

Ninos Malek explains how property rights are the key to environmental conservation efforts.

Jeffrey Rogers Hummel takes on anthropologist David Graeber.

Capitalism and Gay Identity: God’s Two Greatest Enemies

Brandon Christensen Culture, History , , , , , , , , , ,

I recently read an article in this anthology on the emergence of gay identity in the United States and its connection to capitalism. I was particularly delighted to read it after the author, John D’Emilio, admits the following in the abstract:

Using Marxist analyses of capitalism, I argue that two aspects of capitalism – wage labor and commodity production – created the social conditions that made possible the emergence of a distinctive gay and lesbian identity.

Before I continue I should mention that the article was published in 1983 – a whole six years before the fall of the Berlin Wall – so my initial stance going in to the reading was one of condescension. In my head I was thinking:

Oh really? A Marxist analysis of gay identity and how it relates to capitalism? I can’t WAIT to see what interesting charges will follow. Private prisons for homosexuals? Exploited homosexual labor for meager wages? I am soooo glad that my critical thinking skills are respected by the academic community.

Alas, the article in question is very, very good (but for all the wrong reasons, of course!).

The article is good for three important reasons.

1) it explicitly shows how capitalism, or more precisely the market, has indeed provided more freedom for homosexuals.

2) it inadvertently shows how the state has been used by factions to impose their will upon other factions in society.

3) it illustrates just how utterly childish Leftism in general and 1980’s American Marxism in particular really is.

D’Emilio, an academic historian (lest you question his very good credentials), begins by explaining how the gay and lesbian identity as it is understood today began to emerge in the 1960’s. The key aspect here is that a number of myths about homosexuality were created and adopted by the gay movement in response to state-sponsored oppression. It would be pertinent to keep these myths in mind when we think about other movements that have worked to eliminate oppressive laws (which are always and everywhere created and enforced by our enemy: the state) since the 1960’s. D’Emilio writes:

[…] we constructed a myth of silence, invisibility, and isolation as the essential characteristics of gay life in the past as well as the present. Moreover, because we faced so many oppressive laws, pubic policies, and cultural beliefs, we projected this image into an image of an abysmal past

[…] There is another historical myth that enjoys nearly universal acceptance in the gay movement, the myth of the ‘eternal homosexual.’ The argument runs something like this: Gay men and lesbians always were and always will be. We are everywhere; not just now, but throughout history, in all societies and in all periods. This myth served as a political function in the first years of gay liberation.

It is important to note here that myths among minority groups are often created by the intellectual class to help give such groups a base with which to launch their “resistance” campaigns from. While liberal democracies are much better for minority groups than are other types of governments, there is still oppression to be found. Again, this oppression is always and everywhere created and enforced by the state at the behest of factions. The marketplace, which is made up of billions of individuals pursuing their own self-interests, has no place for systematic rules of oppressing potential customers and business partners. This is not to say that some business interests don’t try to eliminate competition through laws based on irrational, xenophobic or racist views, but only that if the market is allowed sufficient room to operate freely then individual freedom and prosperity will ensue.

When D’Emilio writes about the myth of the eternal homosexual, he is not denying that homosexuality has been absent from human societies since time immemorial. What he stating here is that homosexuality as American society now understands it is a new phenomenon. Got that? So, 200 years ago homosexual acts weren’t considered homosexual. They were something else entirely and dependent upon the cultural interpretations for homosexual acts of a given society. This is what scholars mean when they refer to “identity.”* D’Emilio continues to elaborate his point:

Here I wish to challenge this myth. I want to argue that gay men and lesbians have not always existed. Instead, they are a product of history, and have come into existence in a specific historical era [stay with me here, outdated Marxist frameworks can often be useful – bc]. Their emergence is associated with the relations of capitalism; it has been the historical development of capitalism – more specifically its free-labor system – that has allowed large numbers of men and women in the late twentieth century to call themselves gay, to see themselves as part of a community of similar men and women, and to organize politically on the basis of that identity.

D’Emilio is admitting here, in an anthology published by the Monthly Review, that capitalism has created the space necessary for homosexuals to live their lives as freely and as independently as possible, something that has never been accomplished before**. What’s more, D’Emilio is correct and for all the right reasons. More flexibility and mobility among individuals is one of the hallmarks of capitalism, as is the emergence of more choices for just about anything. Without capitalism, the gay and lesbian movement would have never existed. There would always be people living in the closet, to be sure, but it was the institutions aimed at creating freedom of association and choice – the hallmarks of the market-based economy, or capitalism – that was developed by American society that has led to emergence of a vibrant, proud, and now-successful gay and lesbian movement.

Although the gay and lesbian movement began to flourish in the 1970’s as a result of liberalized markets and the re-emergence of globalization (which creates even more choices and more prosperity for those who participate), D’Emilio notes that in the 1950’s and 60’s “oppression by the state intensified, becoming more systematic and inclusive.” Again, D’Emilio is correct. The state has always been a useful tool by which one faction aims to oppress another faction. Conservatives have always loathed homosexuality (the closet conservatives most of all!), and their attempts to equate homosexuality with communism in the 1950’s and 1960’s falls neatly in line with their demagogic attacks on homosexuality over the course of the American republic’s history.

So how is it that capitalism, which has led to the flourishing of gay identity in the West, can be condemned by Marxists of the 1980’s (and probably today as well) for the very same oppression that it has undone if the state has been the ultimate oppressor of this flourishing?

Here is where we can find the childishness of the Left.

D’Emilio answers the first half of my question:

The answers, I think, can be found in the contradictory relationship of capitalism to the family. On the one hand […] capitalism has gradually undermined the material basis of the nuclear family by taking away the economic functions that cemented the ties between family members. As more adults have been drawn into the free-labor system, and as capital has expanded its sphere until it produces as commodities most goods and services we need for our survival, the forces that propelled men and women into families and kept them there have weakened. On the other hand, the ideology of capitalist society has enshrined the family as a source of love, affection, and emotional security, the place where our need for stable, intimate human relationships is satisfied.

This elevation of the nuclear family to preeminence in the sphere of personal life is not accidental. Every society needs structures for reproduction and childrearing, but the possibilities are not limited to the nuclear family. Yet the privatized family fits in well with capitalist relations of production […] Ideologically, capitalism drives people into heterosexual families […] Materially, capitalism weakens the bonds that once kept families together so that their members experience a growing instability in the place they have come to expect happiness and security. Thus, while capitalism has knocked the material foundation away from family life, lesbians, gay men, and heterosexual feminists have become scapegoats for the social instability of the system.

NNNNOOOOOOOOOOOOO!!!! How can I be reading this? How does something that has been so brilliant up to this point become so childish and immature? Why am I going to school again? To learn critical thinking skills? Let me get this straight:

1) instead of acknowledging the ability of capitalism to provide more choices and better lives for individuals in society, or

2) acknowledging that the state is the actual oppressor of liberty, the author decides to

3) blame homosexual oppression on the “contradictory relationship of capitalism to the family” due to ideology?

Can it get any more childish and immature than this? The author is basically stating the following: Capitalism helped alter family life in a fundamental way in the 19th and 20th centuries, so families adapted themselves accordingly.

I think the inability of the author to give credit where credit is due (because of ideological reasons, ironically enough) does enough to discredit the “Marxist analyses” we are dissecting, but there is one piece that I would like to hone in on, if only to more fully discredit the dying, reactionary school of thought known as Marxism:

“Ideologically, capitalism drives people into heterosexual families”

First of all, I didn’t realize that capitalism had an ideology. I am fairly certain that the Marxists of the 1980’s did (do?) not know what capitalism’s ideology was either. Reality tells a different story than the one depicted in the two paragraphs above. What capitalism has done, and continues to do, is provide more choices to individuals (including homosexuals). Just as the family continued to adapt to changes in the past, so too will they continue to adapt in the present and the future. Gay marriage is a big topic these days, and – guess what? – it the state that is to blame for the oppression of individual choice, not capitalism.

I and others here at Notes On Liberty are well-aware that conservatives are behind the efforts to hamper choice in the market for marriages. Warren Gibson, Jacques Delacroix, and Fred Foldvary have all blogged about this before. If Leftists are truly interested in equality they would do well to heed the facts concerning gay life in the West: Capitalism has brought about the movement’s flourishing, and the government is holding it back. This fact is true not just in the realm of gay identity, but in the realm of all other social, political, and economic aspects of as well. Leftists would also do well to remember that their movement, as it stands now, as it stood three decades ago, is, for all intents and purposes, one of conservatism, obstinate ignorance, and embarrassing causality.

*Since the collapse of the Soviet Union and the horrors of the centrally-planned economy became exposed to all, the Left has been trying its hardest to avoid using the term “individualism” in its theoretical frameworks. Thus it has concocted a bunch of somewhat-useful terms like “identity” to explain what libertarians have been trying to get across to everybody for centuries: that individuals are best-able to choose for themselves, and therefore it would be best to go about molding social institutions like laws and political structures to play an accommodating role in individual choices by reducing (or outright eliminating) the size and scope of the state.

**In Native American societies, homosexuals had a large amount of personal freedom and were often revered for their shamanistic qualities, but such a social status worked both ways: if there was a problem of some kind that was viewed as supernatural then guess which shaman’s feet the blame often fell to? Shamans were often murdered quickly rather than put on trial due to the fears of witchcraft that Native American tribes harbored.

PS I don’t think I’ve ever used the term “homosexual” in a conversation before. If anybody out there has a term that gay people like to refer to themselves as I would be grateful for the heads up. Otherwise I will just continue to call everybody “dude.”

PPS Inevitable disclaimer: no I am not a homosexual. I like boobs and big juicy female butts. I like ’em a lot! Ladies: send me dirty messages to my Twitter account!

PPPS I have a lot of respect for Karl Marx. Go here for details.

Around the Web, Kinda

Brandon Christensen Current Events, History , , , ,

No.  The master narrative of High Liberalism is mistaken factually.  Externalities do not imply that a government can do better.  Publicity does better than inspectors in restraining the alleged desire of businesspeople to poison their customers.  Efficiency is not the chief merit of a market economy: innovation is.  Rules arose in merchant courts and Quaker fixed prices long before governments started enforcing them.

I know such replies will be met with indignation.  But think it possible you may be mistaken, and that merely because an historical or economic premise is embedded in front page stories in the New York Times does not make them sound as social science.  It seems to me that a political philosophy based on fairy tales about what happened in history or what humans are like is going to be less than useless.  It is going to be mischievous.

How do I know that my narrative is better than yours?  The experiments of the 20th century told me so.

This is from Deirdre McCloskey’s blog post over at a new symposium being put on by Bleeding Heart Libertarians. It is probably the best thing I’ve read on the web in a couple of years. You can find the rest of the posts from the symposium here. I highly recommend all of them.

Co-editor Fred Foldvary recently participated in the last symposium that BHL held on Libertarianism and Land. You can find both of his entries here (be sure to read through his responses in the ‘comments’ section, too) and here.

“Stocks Slammed as Dow Erases 2012 Gains”

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

That’s the title to a headline piece over at CNN.

The Dow Jones industrial average (INDU) plunged 275 points, or 2.2%, the biggest one-day drop since November. The blue-chip index gave up all its gains for the year, and is now 99 points below where it finished 2011. The S&P 500 (SPX) lost 32 points, or 2.5%, and the Nasdaq (COMP) dropped 80 points, or 2.8%.

Ouch. The cause of the plunge?

“The U.S. employment report was simply terrible,” said Marc Chandler, global head of currency strategy at Brown Brothers Harriman.

The May jobs report showed only 69,000 jobs were added to payrolls, less than half the 150,000 jobs forecast by economists surveyed by CNNMoney. The unemployment rate ticked higher for the first time in a year, rising to 8.2%.

I take three things away from this: Continue reading →

Farewell Lecture (Congratulations!)

Brandon Christensen Economics, Liberty, Links , ,

Hey everybody,

Co-editor Fred Foldvary is retiring from Santa Clara University and will be giving a farewell lecture on June 6th. The details:

Dear CSI personae,

Fred Foldvary, CSI Director, will retire from SCU on June 2012.

 

His farewell CSI public lecture will be held

on June 6, 7-8:30 PM, Lucas Hall 126 the Forbes Family Conference Center.

 

Foldvary’s lecture will be on the question:

“What gives you the right to exist?”

If you had to prove it on the penalty of death,

how would you answer?

 

See you there,

Fred Foldvary

ffoldvary@scu.edu

We hope everybody who is in the Silicon Valley at the allotted time can attend. Here is CSI’s website. Here is a partial list of Dr. Foldvary’s academic publications over the years (hopefully they are ungated). Here are his writings in the Freeman. Here are his writings in the Progess Report.

Congratulations Dr. Foldvary, you finished the rat race in one piece!

Around the Web

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

Co-editor Fred Foldvary on the Buffet Misrule.

Mona Eltahaway, an Egyptian-American columnist who was detained and sexually assaulted by Egyptian security forces during the uprisings, writes about Why They Hate Us.

In the Atlantic, Conor Friedersdorf explains how student debt forgiveness is just another subsidy to the rich.

Will Wilkinson, writing in the Economist, on how Fair is Fair.

Guess who else got their hands on Libyan weapons?

Around the Web

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

Co-editor Fred Foldvary is participating in a symposium over at Bleeding Heart Libertarians.  Check him out.

Michael Mungowitz bags on Greece and the Euro Zone.

Zach Gochenour has a complimentary follow-up piece on Dr. Foldvary’s essay: Progress or Poverty: The Economics of Land and Discovery.

All Hail Azawad.  A blogger obsessed with maps from the New York Times writes about the new state’s prospects .  I have written about Azawad here, here, here, and here (oh God I hope I don’t sound like Walter Block!).

Jacques Delacroix provides even more insights into the French elections and its implications for the Euro Zone.

The collapse of the Euro Zone is kind of a big deal.  Personally, I hope the collapse only destroys the currency of the zone, and not the ability of its members to trade and work freely anywhere throughout the zone.  I also want a pony and never-ending supply of really good weed.

The European policymakers and technocrats should not have been so brash as to believe that they could unify Europe politically.  Not only is that bad for democracy, but it has also given the underlying principle behind the EU – free trade – a very bad name.  Repeat after me: large polities that are economically united and politically divided are good for everybody, but large polities that are economically and politically united are bad for everybody.

It’s even worse when you throw in concepts like Old World identities such as ethnicity into the mix and try to get everybody to play nice through the democratic process.

Chicago, Vienna and San Francisco

Brandon Christensen Economics, Links , , , , , , ,

Co-editor Fred Foldvary has a great essay up on three schools of economic thought that deserves to be read by all.  An excerpt:

The Vienna school emphasizes the dynamics of the economy, while the Chicago method is to apply self-interest and economizing in an equilibrium analysis.  The San Francisco school uses both equilibrium and dynamics.  The dynamic approach of change over time is used to show the advance of rent and lowering of wages as the margin of production moves to less productive land and as land speculation moves the margin out even further.  Equilibrium shows that since market rent is based on the fixed supply of land and the demand to rent space, the tax on land not affecting the rent.

The San Francisco school agrees with the Vienna school that the spontaneous order of the free market best allocates goods to human desires.  But the San Francisco school points out that if the ground rent is not tapped for public revenue, when taxes on other things finance civic works, then there is in effect a subsidy to land owners, which distorts the market.

The San Francisco school has a theory of the business cycle based on land values, which rise during a boom, when speculation carries land prices so high that investment gets choked off, resulting in a recession.  But San Francisco has lacked a consensus on the role of central banking and money.

Check out the rest here.

I tend to pay attention whenever Dr. Foldvary writes, because he is the guy who wrote a book in 2007 accurately predicting the economic collapse of 2008.  You can access the book for free here.

Links From Around the Web

Brandon Christensen Links , , , , , , , , , , ,

Co-editor Fred Foldvary on the destruction of the Libertarian Party.

Newest member of the consortium, Warren Gibson, writes in the Freeman about GDP.

Ninos Malek on associating in peace.

Jacques Delacroix questions Ron Paul’s credibility.

And writing over in the Atlantic, Conor Friedersdorf celebrates the failed boycott attempts of Rush Limbaugh’s show.

I just started school today, so if you don’t hear from me for a while, you now know why.  Have a great spring!

Two More Days!

Brandon Christensen Economics, Liberty, Links , , ,

Two more days to sign up for the Independent Institute’s summer seminar scholarship offer.

I first became interested in libertarianism during the 2008 presidential campaign, when Ron Paul gained national prominence for his tangle with Rudy Giuliani on foreign policy.  In the summer of 2009, just after the presidential primaries wrapped up, I embarked on a nationwide journey to learn more about the concept of liberty.

My first stop was the Independent Institute’s summer seminar, an from that experience I not only learned a lot about how markets work (I just spent the afternoon going over my notes from the seminar), but I was also able to make some great connections as well.  Indeed, the co-editor of this blog, Fred Foldvary, was a lecturer at the seminar, and Brian Gothberg, who is incredibly good at teaching basic economic subjects, are just some of the fantastic people that I have been able to count over the past three years for intellectual support.

If you want to spend a week in one of the San Francisco Bay Area’s most beautiful locales, learning about liberty, history, civil society, and the market process, then I highly suggest checking out their seminar.  It is absolutely fantastic.

Some Great Links From Around the Web

Brandon Christensen Economics, Links , , , , , , , , , , , , , , , ,

A fascinating blog post on Indian domestic politics and foreign policy by a Ph.D. student living in New Delhi and studying at Jawaharlal Nehru University.

Alex Warren, a journalist with extensive experience in the Middle East, writes about Libya’s decentralization.

“The Current Models Have Nothing to Say.” That is economist Robert Higgs’s analysis of modern, orthodox economics.

Might regionalism help solve Central America’s woes?  Be sure to check out the rest of the blog, by Seth Kaplan, too.

Conor Friedersdorf of the Atlantic has a penetrating look at the logic of a drug warrior (h/t Brian Aitken)

Co-editor Fred Foldvary, writing in the Progress Report, explains that value is subjective.  This is an important concept when it comes to understanding economics.