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Thursday, 25 August 2011

What Makes Austrians so Effing Smug?

[Geoff, what is the "high falutin'" index here? More than 4, I'm sure.]

Well actually, they aren't – at least, not as smug as they have every right to be.

It is those on the left who claim the high moral ground, those whose thinking is socialist. Left wing trolls, who frequently lurk below the bridge to hurl abuse at "right wing" blogs (including this one) use unpleasant language to sneer and smear.

Socialists have been, by far, the greatest mass murderers in history. Why would someone like Tony Benn, a man of considerable natural gifts, be so proud to call himself a Socialist? Why was I? Why would he allow himself to be associated with killers like Hitler, Stalin, Mao, Pol Pot, Castro, Guevara and Kim Jong Il? Why did I? I will answer for him and for myself: Culpable Stupidity!

Rudolph Rummel, Emeritus Professor of Political Science at the University of Hawaii gives the figures for Communist murder. This table does not include National Socialist murders, although you can find those figures on his site too. For too long we accepted the nonsense that Communists and Nazis were at opposite ends of the political spectrum. It was a clever trick by Uncle Joe Stalin to label his sometime allies as "rightists". Jonah Goldberg, in his magnificent Liberal Fascism, opened my eyes; and it seems that more and more people now recognise that Communism and Nazism were fraternal twins.

Rummel's website is not very user-friendly but it is well worth a visit. Here is a link:

Socialist Democide

Why do Austrians have the right to be smug?

In trying to answer this question, I am going to address another one first, one about which there is no longer any controversy in developed countries: Why would you have the right to be a bit smug (or condescending) on the subject of hygiene, if confronted by a hypothetical someone who denied its relevance to health?

  • Your education included the notion that many deadly diseases were/are caused by microbes (fungi, bacteria and viruses).
  • That notion is supported by observations and by logic – remember Koch's postulates?
  • Scientists looked down microscopes and saw the little buggers. These microbes caused diseases when injected into healthy subjects. They had a theory that is absolutely convincing – watertight!
  • When they took action to kill the microbes – in food for example (pasteurisation), the incidence of disease declined.
  • When sewage systems were installed – thereby isolating people from huge concentrations of these microbes, the incidence of disease declined.
  • When water treatment plants ensured that the population had microbe-free water, the incidence of disease declined.
  • When people were educated into habits of hygiene – eg washing their hands after relieving themselves, the incidence of disease declined.
  • When and where unhygienic conditions prevailed, the incidence of disease was seen to be high. Repeated observations have confirmed the theory 100% of the time.

Your education gives you some right (not much) to be smug about hygiene. You and I are in 100% agreement on this issue. Anyone who disagreed with us would do so only because of (not necessarily culpable) ignorance.

The Austrians are in a comparable position to Semmelweis (one "s" not two, whoops), Lister and Pasteur (our hygiene heroes) – comparable but not identical. The Austrian method is "praxeology" (arguing from general principles, or axioms – as in Mathematics), whereas the natural sciences derive a theory from observations and then test it by experiment – a subtle but important difference. In Praxeology and in Mathematics, if your reasoning is correct, your conclusion is true. No amount of observation can disprove Euclid's theorems, whereas in Astronomy, for example, ever more accurate observations might force you to reconsider your theory – and come up with something closer to the truth.

Anyway, the Austrians have true theorems. Nevertheless, as it happens, repeated observations are another way of convincing doubters.

  • By pure Reason, the Austrians demonstrate, for example, that the division of labour (ie specialising) makes a society richer – argument watertight!
  • Observation and History confirm that the richest societies are those in which specialisation has gone the furthest.
  • By pure Reason, the Austrians prove that prices are subjective and they derive the Theory of Marginal Utility – argument watertight!
  • Observation and History confirm that, without this insight, planned economies have found it impossible to determine
    appropriate prices and that gluts and shortages always result – massive government induced famines, for example, in which millions died. Tractors rusted unused for lack of fuel and spare parts.
  • By pure Reason, the Austrians show that when interest rates are held down by central banks, malinvestment is inevitable – argument watertight!
  • Observation and History have confirmed repeatedly that interference of this kind by central banks always creates
    unsustainable booms. These booms are followed by busts. Hello!

This is why Austrians have a right to be smug.

Compare these countries:

Taiwan, South Korea, Hong Kong, Singapore, Malaysia, China (recently), India (recently) and Japan (until recently)


North Korea, Cuba, China (until recently), Zimbabwe, India (until recently), Japan (recently) and all socialist countries.

Compare the so-called Iron Curtain countries with themselves before they threw off the Soviet hegemony.

Wherever economic policy accords with free-market theory (and to the extent that it does), people are better off. I assume that you want people to be better off. Me too! No brainer!

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