Author: White Whale

“The adverse effects of redistributive policies on economic performance are implied in such expressions as the trade-off between equity and efficiency, or between social justice and efficiency. These formulations recognize to some extent that economic activity is not a zero-sum game. But they still disguise the extent the outcome of economic processes depends on the performance of people–performances which can be promoted or obstructed by official policy.

I have already noted that it is by no means obvious why it should be unjust that those who produce more should enjoy higher incomes. And attempts to prevent them from doing so will affect adversely the average level of incomes. It will do so cumulatively because if everyone can expect to receive only something like the average of all income, this average itself will fall. A neat example of this process emerged from an experiment designed a few years ago by a teacher in an American university. The students demanded much greater equality in all walks of life, including the grading of their papers. In response to these demands the teacher announced that from a given date the students would be given equal grades for their weekly papers, and that the grades would be based on the average performance of the class. The experiment brought about a rapid decline in average performance and thus in the average grade, because the incentive to work declined greatly.”

This, in a nutshell, is why free markets and the profit motive are the greatest engines for generalized economic advancement and technological innovation ever devised: it harnesses motivation in the direction of creation.

As I say on my other website, you can be equal in both wealth and poverty, and since Socialism doesn’t create wealth, equalization in poverty is the default outcome.

“Old age, ill health, the bringing up of children and interruption of earnings, these are contingencies of life to be paid for out of one’s income, and for which adults can be expected to provide by saving or insurance. In many Western countries provision for these contingencies has come to be taken over largely by the State. Because the provision cannot be adjusted to the widely varying circumstances of individuals and families, it is apt to be both expensive and unsatisfactory. Such provision is necessarily financed by taxation. As a result many people’s post-tax income becomes like pocket-money,which is not required for major necessities and hazards of life because these are paid for by taxes largely levied on themselves. This policy treats adults as if they were children. Adults manage incomes; children receive pocket-money. The redistribution of responsibilities implied in the operation of the welfare state means the reduction of the status of adults to that of children.

“There is a further result of large scale redistribution of responsibility between the agents of the state and private individuals, a result which acts as anomolous [Bauer’s preferred word for utterly idiotic] and even ominous force for perpetuating and extending this policy. Prudent people, even if poor, can normally provide for the contingencies of life by saving and insurance, but only if the value of money remains reasonably stable. They are unable to do so when this condition does not hold. Heavy state spending on welfare in various ways promotes the erosion of the value of money, a risk against which many people cannot protect themselves, certainly not by saving and insurance. The difficulty, or impossibility of protecting themselves effectively leads them to accept or to demand that tax-financed provision for these contingencies should be maintained or extended, even if this is recognized to be unsatisfactory.”

Ponder this. What he is noting is both that welfare states infantilize people, by design, and also that Keynesian policies, through the inflation they tend to provoke, tend to make the little lambs cling yet more tightly to their mothers teat, out of necessity.

Always, the increase in dependence, through policies enacted through people who are themselves economic parasites.

“Why, in free and open societies such as those of Western countries, are some people better off than others–not necessarily wiser, happier, nicer or more virtuous, but better off? The precise causes of differences in income and wealth are complex and various, and people will always disagree on how they apply to particular societies, groups, or individuals. But in substance such differences result from people’s widely varying aptitudes and motivations and also to some extent from chance circumstances. Some people are gifted, hard-working, ambitious and enterprising, or had far-sighted parents, and they are therefore more likely to become well off.

“In an open and free society [note that people like George Soros mean by “open society” a Fascistic system of generalized government controls of all aspects of the economy and the personal lives of individuals], political action which deliberately aimed to minimize, or even remove economic differences would entail such extensive coercion that the society would cease to be open and free. The successful pursuit of the unholy grail of economic equality would exchange promised reduction or removal of differences in income and wealth for much greater ACTUAL [emphasis mine] inequality of power between rulers and subjects.”

“When social scientists talk of social problems, the usually mean discrepencies between social reality and what they assume to be norms [ahistorically: these are actually posited desirable norms and not objective conditions to be found in actual human history]. Because they are largely preoccupied with discerning, announcing and emphasizing discrepencies between their assumed norms and reality, social scientists tend to GENERATE [emphasis mine] social problems rather than solve them.”

“In an open society income differences normally reflect the operation of voluntary arrangements [the negotiated agreement being less onerous than whatever the alternative was]. The absence of coercive power in most forms of successful economic activity is recognized in Dr. Johnson’s familiar observation that ‘there are few ways in which a man can be more innocently employed than getting money.'”

Note that Bill Gates did not rob anyone, but all Communists have.

“The accumulation of wealth, especially great wealth, normally results from activities which extend the choices of others, as is clear from the fortunes acquired in, say, mass retailing or the development of the motor car.”

“In recent years inequality has come to be used interchangeably with inequity, and equality with equity. That differences is a more appropriate term than inequality is also suggested by the accepted practice of referring to people’s physical characteristics, such as height, weight and strength, as differences rather than inequalities, and never as inequities.

“On the other hand, the term inequity is appropriate in discussing political power because that power implies a relationship of command between rulers and subjects. . .those who have political power can coerce others by restricting their choices, while wealth does not by itself confer such power on the rich.

“In contemporary parlance social justice has come to mean substantially equal incomes. Why should this be so? It is not obvious why it should be just to penalize those who are more productive and contribute more to output, and to favor those who produce less. This conclusion is reinforced when it is remembered that relatively well off people have often given up leisure, enjoyment and consumption, and that these past sacrifices have significantly contributed to their higher incomes.”

If you read Communist propaganda–which continues to be generated to this very day, albeit not generally under that precise name–you get this feeling that money is theft. All those houses on the hill were stolen from the people at the bottom of the hill. But look at America: almost all fortunes are first generation. These are cardiac surgeons whose parents were born in small villages in India or Pakistan. These are successful entrepreneurs born to average middle class parents.

And the list of the wealthiest American families has changed constantly since whenever it was first produced. Some names stay the same–notably those such as the Rockefellers, who can use the power of government to support and create anti-free market conditions–but most come and go with regularity.

“Major beneficiaries of redistribution include its advocates, organizers and administrators notably politicians and civil servants, who are NOT among the poor. This outcome promotes the self perpetuation of the process. . .On the national level, the operation of the welfare state comprises two quite different forms of redistribution: wealth transfers between groups, and redistribution of responsibility between between the agents of the state and private citizens. Welfare state policies do not always redistribute income between rich and poor [emphasis mine]. They do not necessarily redistribute income even among individuals. The same people may be taxed at some times and subsidized at others.”

As one example, the average wage earning has some 12.4% of their income AT LEAST taken out immediately to support Medicare, Medicaid, and Social Security. Some amount more, depending on the State is further taken out to fund a State run unemployment fund. Low income individuals are also taxed with sales taxes in most states. Thus they pay in in one place, and take out, maybe, in another. The entity which wins EVERY time is the government, which is to say that large number of people whose paychecks are paid out of tax dollars taken from the pockets of everyone who works for a living.

I have been slowly working my way through Peter Bauer’s excellent “Equality, the Third World, and Economic Delusion”. Everything one would need to critique not just development programs overseas, but also domestically is in this book.

In fact, it is quite easy to argue and document that the economic policies pursued by most of the European colonial powers in their overseas colonies from roughly the 1930’s–heyday of Fascist theorizing–through independence were, your choice of word, Keynesian/Fascist/Socialist; and that the continuation of those policies has led to grossly reduced wealth production, political control by privileged elites, famines and war.

Take India as an example: they implemented the tight government controls Keynes called for. The government invested heavily in infrastructure projects. They controlled wages and production. And what they got was 40 years of stagnation. In the early 1990’s, they opened things up, stopped riding the asses of every entrepreneur in the country, and have expanded steadily for 2 decades.

There is no ambiguity about how to grow an economy: it is to let people seek their own way, in conditions of freedom, including to the extent possible freedom from taxation.

These are a few general thoughts. I am going to quote Bauer extensively, as he has a way of saying things clearly and simply without the loss of important aspects of his meaning. That will be the next post.

The roots of both success and failure inhere in beginnings. You can, of course, make a good ending of a bad start, but over time and in aggregate things tend to flow naturally from their starting points.

The task is not to add skill, but rather to deduct what is unnecessary, until all that remains is effectiveness. The seed of any beginning is who you are, what you have made of yourself. Better seeds create better beginnings and hence better endings.

To grow as a person, is to grow in effectiveness.

Leftists relentlessly criticize the profit motive, as somehow self seeking. What they fail to consider, because they are either stupid or cynically malignant, is that businesses also operate under what might be termed a loss motive, by which I mean that there is both a carrot and a stick in play: they want to make money, of course, but they equally do not want to LOSE money, which over some period of time can and will lead to bankruptcy.

State bureaucracies–governments in general–tend towards organizational bloat because the incentives in place are completely divorced from practical considerations. In practice, failure is not just common, but irrelevant to the long term success of the project. They are not punished by failure, nor are they rewarded for success. They are rewarded for political obedience, and rewarded with larger staffs, salaries, and a larger chunk of the taxpayers wealth.

There is no loss motive, and the profits made in no way imply altruism–on the contrary, naked greed for both money and power are plainly on display ubiquitously–nor the capacity to create anything that is of use to anyone.

Self evidently, some government is necessary, but government checked by the DEMAND on the part of taxpayers that it actually accomplish the aims for which it allegedly exists.

“I Am”, or “That which brings into existence that which is”, or “I Am that I am”.

God is that which is, or that which brings into existence that which is. This is the opposite of idolatry, as I have defined it. This is a brilliant conception.

Further, I like the fact that there are gaps in the concept: the vowels are missing. Theoretically, one could pronounce the word many different ways, yet it would retain essential parts of its form. This coincides with the fundamental unity and multiplicity of existence, depending on which lens we view it through.

If you abstract it far enough, this is what I am trying to do with my conception of Goodness. I want certain parts to be flexible, and certain parts to be rigid.

An example I use from time to time is that of the classical Japanese Katana. The metal is folded over again and again on itself, which in my terms would equate symbolically to qualitative richness. What appears a whole, is in fact composed of much past movement, much effort. The result is something both very sharp, and very flexible.

You may find this history of the Japanese swordsmithing interesting.

This is an interesting and important topic.

When the–shall I call them refugees?–created the Golden Calf, it was created according to their inclination, in the form they chose, of the material they chose; and after worshipping it, they decided that it must want them to have a feast.

What they created, in other words, was a metaphysics that suited them, which they made no effort to reconcile with reality. It was a fantasy, a bubble, a congenial universe that just happened to suit their fancy.

In my view, the doctrines of Darwinism and “death-ism” (soul=brain), and the materialism which underlie them, are likewise idolatrous, because they cater to the vanities and preferences of the people holding these views, and not because they are defensible empirically.

This universe plainly has rules, by which I mean repeatable and reliable correllations between cause and effect, between stimulus and reaction. Some of the connections are linear and some are systemic; but all are reliable. This applies not just to what is READILY observable, but to the distant, soft, faint forces like those of psi, and mediumship.

People don’t realize this, but throughout modern history there have been mediums who could not just repeat words supposedly whispered into their ears, but actually manifest entire spirits, who could talk. Now, people may be skeptical, but the simple reality is that those scientists who have undertaken to study the matter have nearly uniformly changed their minds (usually beginning as skeptics); and scientists today who reject these notions out of hand can be reliably assumed not to have attended any seances with credible mediums (self evidently there are many frauds).

True scientists are open to all evidence, and all justifiable conclusions flowing from that evidence. Proper skepticism is equidistance from both belief and rejection. It allows you to move intelligently.

Framing things in this way, one can readily see why idolatry is prohibited in the Ten Commandments.

Put simply: idolatry is on this definition necessarily delusion, and there are no benefits to delusion. If the task is ordering our behavior rationally in a rational universe, we must know the rules. This should be self evident, and axiomatic.

It seems to me that idolatry is asking God to bow down to you. It is asking something from the universe which you have not put in it.

Was not the Golden Calf a visible sign of the possibility of material abundance, and celebrated as such? Rather than understand God’s will, they literally created a God out of their own wishes.

As I see it, our principle task is understanding how this universe works, and conforming ourselves to its dictates. We can never know what potential learning inheres in even the worst experiences.

I was pondering what courage is over lunch today. I have a few thoughts and observations, that should likely be taken as data points.

It comes from the old French for “heart”.

Continuum formation: do we call people brave who get up and drive to work every day? Not normally. But we do if they have never worked, or have a fear of driving. We might call an agorophobic who goes outside brave, but for most of us it wouldn’t warrant a second thought.

Do we call courageous people who are in danger, but don’t know it? For example, someone swimming in the ocean, menaced by sharks they never see and which never attack? They didn’t know to be afraid, so they weren’t.

Do we award soldiers medals for doing their job in combat? We lost something like 250,000 dead in WW2, and most never got medals. We only award them for conspicuous courage, beyond that normally expected.

Soldiers are trained in many ways to focus on their jobs, first and foremost, and to think as little as possible. This is so they can operate even in conditions of fear, on autopilot, to the extent possible.

It seems to me that courage is what is needed where fear is present. It implies fear. It implies pursuing a course which provokes fear, and staying the course regardless. It is a claustrophobic getting in an elevator, and it is also someone jumping out of an airplane at night who finds it very nerve wracking.

Courage is the WILL to stay the course in spite of what amount to attacks by one part of your self–the self preserving instinct–against another–your sovereign consciousness. Will, in turn, is a type of attention, where you focus on some things–what you want–to the exclusion of alternatives, such as the possibility of flight and failure.

Courage, then, is an exertion of energy in the pursuit of a chosen objective, even though not all parts of you agree with that objective.

Some people love rock climbing. They love the excitement, and they do it voluntarily all the time. Does this take courage? No, not by my definition. All parts of them agree with the objective, even though danger is present. They feel–in most cases with ample cause–that actual danger can be well managed through a focus on the task, on doing it right, and not making mistakes.

Interestingly, this leads to the conclusion that a life well lived needs progressively LESS courage, and more engagement without fear.