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Saturday, 6 December 2014

Evil Capitalists

Everywhere you look you find people denouncing Capitalism. Some do it on the grounds that it is allegedly full of ‘contradictions’ which cause booms and busts. It is difficult to be polite about their intelligence. Let’s be kind and blame their education – their miseducation. Ever since Hayek we have known what causes booms and busts. He and the other Austrians spell it out very clearly.

What follows is my summary of the Austrian Theory of the Business Cycle.

When governments manipulate credit with a view to stimulating economic activity, it works for a while because investors receive a misleading signal: money is cheap; we can confidently invest in long term projects. They borrow.

If money were cheap because consumers are consuming less and saving more, this would be OK. But consumers are getting the same misleading signal. They borrow. They buy champagne and caviar and houses and holidays with the cheap money. These goodies suck resources from the economy: labour, energy and raw materials. So consumers and investors are competing for the same resources. Economics is about scarce resources.

Investment requires savings – or should. If I save I can invest in your enterprise. I can’t indulge my lust for lollipops and put the same money into a bank which will advance you what you need to build your workshop. Cheap money conjured out of thin air by governments and the banking system is like the froth on your pint; it is based upon a lie – the lie that we can get rich by doing arithmetic.
Some must save before anyone can invest.

If our money were sound… Start again. When our money was sound, when it was based on precious metals (precious because we agreed to compute the value of everything in terms of gold and silver), saved money could be converted (by mixing in creativity and hard work) into products which were useful and desirable. In less than 300 years our ability to create products (wealth) spiralled upwards and upwards in the most virtuous economic circle the world had ever enjoyed. Poor people drove cars! The petrol for these cars became cheaper and cheaper – thanks to men like Rockefeller. Cars themselves became cheaper – thanks to men like Ford. It was a miracle! We didn’t understand what was going on. It was too new for us to get our heads around. Dyspeptics like Marx told themselves and the rest of us that all this unprecedented prosperity was based on the exploitation of workers – the same workers whose lives (in material terms) were getting better by the decade. Incidentally, a decade was the time it took for the price of kerosene (or paraffin) to be cut by 90% – thanks to John D Rockefeller. We did not give Rockefeller and Ford their due. The Devil bade us listen to Marx. We did and then to Keynes.

The meteoric rise of western economies has slowed and occasionally flat lined, thanks to governments too much influenced by Marx and the baleful JM Keynes. Fortunately, the economies of India and China and much of southeast Asia have adopted increasingly free markets. As a result, abject poverty has declined since 1970 by EIGHTY PER CENT. When did you ever hear a leftist rejoice in this statistic – when? What do they actually want – an end to poverty or an end to wealth? It’s a good question. They advise us to sabotage our industries by adopting inefficient technologies and abandoning efficient technologies. When wealth is reduced, who suffers most, those who have a lot or those who don’t?

Poverty is bad. Wealth is good. The cure for poverty is wealth – and we know how wealth is created. The obvious analogy is sickness and health. Doctors and other health professionals strive to promote health and reduce sickness. Do they ever suggest that health/sickness is a zero sum game, that to reduce the sickness of A we should reduce the health of B?

Do you have any leftist/socialist friends? Ask them what they want. Listen carefully. Do they mention increased well-being for the poor; or do they launch into demands for greater equality? I’d love to hear your feedback. Wilkinson and Pickett and Thomas Picketty denounce inequality of income. They have no interest in reducing poverty. Read their books. Those who applaud them are likewise uninterested in creating wealth, the only antidote to poverty.

And another thing…
These dimwits hate capitalism and capitalists – their myopic picture of capitalism, derived apparently from the game Monopoly. This absurd game can bankrupt me if I land on Park Lane and you have built two hotels on it. Please explain how this in any way corresponds to the real world. I always found it unutterably boring – and now I know why.

They have one picture of capitalists – fat men with waistcoats and white moustaches. They meet real capitalists every day of their lives – but fail to identify them as capitalists. Their own butcher, for example (who may or may not be a nice man), qualifies as a capitalist because he has used his resources (a legacy or savings or borrowings) to create wealth in his community, at the same time providing work for an apprentice or two. Wicked capitalist! Excuse me? The baker and the candlestick maker do not (per se) get rich at the expense of others. They get rich(ish) by getting up at 5:00 am – as do the newsagent, the taxi driver and the takeaway owner. I have been well served by all the latter in the last week. I do not resent their success (such as it is) for one second.

You may not have the nous or the energy to be an entrepreneur. Perhaps you are a saint, the noblest metier of all. Do not presume (whoever or whatever you are) to sneer at those whose efforts and sacrifices give us practically all the material benefits we enjoy. If they benefit from their efforts and sacrifices – get down on your knees and give thanks that (even in this fallen world) attention to our own needs and wants can actually benefit our neighbours.

Adam Smith and JD Rockefeller are not likely to be granted canonisation any day soon. I dream of a pope who will create another category of super blessed – the material blessers of humanity. I am sorry to say that it ain’t going to be the current Holy Father.

Judicial Murder

By way of introduction:
It is interesting to note that opponents of abortion (the faction that has all the arguments on its side) are not always dogmatic opponents of capital punishment. There are cogent arguments on both sides in this debate – not least is the argument that capital punishment is irrevocable and that mistakes can be and have been made.
Still by way of introduction:
What should be the blogger’s rule when reporting an argument? First, be accurate – do not misrepresent your opponent’s position. Second, if your opponent admits defeat, do not gloat.

In the course of a long, enjoyable and good natured conversation the other night, the subject of capital punishment came up. My interlocutor opined that when the state takes a life, it is as much murder as when an individual kills. We agreed that an individual commits no murder when he kills in self-defence. We even agreed that a lowly soldier, compelled to fight by his superiors, is not a common murderer.

What, I wanted to know, is the alternative? Should there be no sanction against murder? Obviously not, we agreed. Deprivation of liberty (aka imprisonment)? Yes, apparently.

But, since we are talking principle here, why, since kidnapping by an individual is agreed to be criminal, should kidnapping by the state be any more justified than killing by the state? For sure, killing is more final and mistakes are possible. Nevertheless, it seems to me, in principle, ‘judicial kidnapping’ cannot be any more or less acceptable than ‘judicial murder’.

Is it true that anything which is verboten to the individual is verboten to the state? If so, taxation should be disallowed – and so should imprisonment. But, we need armies and courts and police forces! So, we need taxation. We cannot allow murderers to roam free. So, we need imprisonment and perhaps executions. The argument from finality and mistakes still stands. However, the argument which equates ‘judicial murder’ with ‘individual murder’ is exposed as being without principle.

A man accused of murder is allowed to defend himself on many grounds. It was an accident. It was self-defence. I was not in my right mind. The ‘judicial murder’ theorists allow society no defence whatsoever.

The argument from squeamishness is powerful. Could you throw the switch, pull the lever, shout ‘Fire’? There are circumstances in which I could. It is clearly the case that some murders are worse than others – just as some rapes are worse than others, though some feminists deny the latter. Could you sever a baby’s spinal cord as it emerges from the birth canal, or even minutes later? Could you vacuum it out from the safety of the womb? The executioner can claim that the murderer deserved his fate. The abortionist can make no such claim.

I have always believed that proponents of abortion are sentimental. The murder of a happy healthy child, in daylight, would revolt any and all of them. Abortion usually takes place in the dark. Even most pro-abortionists agree that Kermit Gosnell was egregiously evil. He is serving time. I could throw the switch on him.

Society and the State:

Careful readers will have noticed that I have used ‘society’ and ‘the state’ in this posting and that I have not distinguished between them. This makes me very uncomfortable. The best argument for the state’s existence is ‘the social contract’. It is not a very good one. Show me my signature on this august document!

Earnest defenders of capitalism (or the free market) are nearly always earnest defenders of ‘the rule of law’. Whence the rule of law? In England and the USA (as well as the other Anglophone nations) we have the sublime tradition of Common Law. Most of us never think about it. Daniel Hannan is eloquent in his praise of it. In our tradition, the ‘law of the land' is not the king’s law. It emerges organically from below – from cases not from statutes. Statute law also exists; and we have Parliament to protect us from its excesses – sometimes.

Obviously, Terry Wogan is the greatest living Irishman (with Gerard Casey a close second) – may their sins be forgiven. The greatest Irishman of all time was Edmund Burke, who attacked the French Revolution and defended the American one. He served as a Westminster MP (as a Whig) and is rightly regarded as the founder of modern conservatism. I am daringly going to summarise his philosophy as: Perfection is not possible; Improvement is.

Burke was an Anglican, though his mother was born a Catholic and his father converted. One of his most famous phrases was ‘the little platoons’ – To love the little platoon we belong to in society, is the first principle (the germ as it were) of public affections. Reflections on the Revolution in France, 1790.

Loving the little platoons must make us fear and distrust the state. ‘The greater the state, the smaller the citizen’, says Dennis Prager and he is right. The state is a Moloch, which frequently devours the little platoons.

So, here am I, conflating society and the state. Shame on me! The state very imperfectly represents society. This is a melancholy truth. Life is full of melancholy truths.

Libertarians (some call themselves anarcho-capitalists) have creative ideas about how law can exist without the state. Gerard Casey is an excellent exemplar. But we are not there yet.
I have gone on too long. God bless!

Friday, 5 December 2014

Islam vs Muslims

When I am finally invited by The House of Lords or The Oxford Union to explain what is wrong with Islam, I am going to have a PowerPoint presentation running behind me. This will feature (among other things) images of beautiful, happy Muslim families, of Muslims carrying out charitable works, of Muslims going out of their way to help non-Muslims and of Muslim contributions to Art, Culture and the Sciences. The purpose of this presentation (which will also feature bad Christians, such as the Medici popes and Catholic supporters of Hitler) will be to deflect from me accusations that I hate Muslims and that I think all Christians are good. It won’t work. Their Lordships and the undergraduates will assume that I hate Muslims. Some will call me a racist (and probably a ‘homophobe’).

Some will think that I am undermining my own case against Islam. Who said, ‘against such stupidity even the gods are helpless’?

St Paul said in Romans 2:14:
…for it is not the hearers of the Law who are just before God, but the doers of the Law (who) will be justified. For when Gentiles who do not have the Law do instinctively the things of the Law, these, not having the Law, are a law to themselves, in that they show the work of the Law written in their hearts, their conscience bearing witness and their thoughts alternately accusing or else defending them…

This is an example of the doctrine of Natural Law, accessible to all. Does St Paul mean ‘saved’ when he says ‘justified’? I hope so.

St Paul is as high an authority as there is (excepting Our Lord) and he is echoed by St Thomas Aquinas.

My animus is not against Muslims, but against Islam as taught in the central texts: The Koran, the Hadiths (the traditions of the Prophet and his Companions) and the Sira (the biography of Mohammed). These contain little theology and much hatred of unbelievers. ALL the ghastly acts of ISIS, Hamas, Al Qaeda, the Taliban, the Islamic Republic of Iran, Hezbollah and Boko Haram are justified by these texts, not to mention the rape of prepubescent girls.

For sure, the Christian texts contain hard passages; but virtually nobody uses (for example) the destruction of the Amalekites as a justification for genocide. It’s a story – maybe a true one. The Sermon on the Mount is Our Lord’s prescription for Christian behaviour. St Paul says in 1 Corinthians 13:

Though I speak with the tongues of men and of angels, and have not charity, I am become as sounding brass, or a tinkling cymbal.
And though I have the gift of prophecy, and understand all mysteries, and all knowledge; and though I have all faith, so that I could remove mountains, and have not charity, I am nothing. And though I bestow all my goods to feed the poor, and though I give my body to be burned, and have not charity, it profiteth me nothing.
Charity suffereth long, and is kind; charity envieth not; charity vaunteth not itself, is not puffed up,
Doth not behave itself unseemly, seeketh not her own, is not easily provoked, thinketh no evil; Rejoiceth not in iniquity, but rejoiceth in the truth;
Beareth all things, believeth all things, hopeth all things, endureth all things.
Charity never faileth: but whether there be prophecies, they shall fail; whether there be tongues, they shall cease; whether there be knowledge, it shall vanish away.
For we know in part, and we prophesy in part.
But when that which is perfect is come, then that which is in part shall be done away.
When I was a child, I spake as a child, I understood as a child, I thought as a child: but when I became a man, I put away childish things.
For now we see through a glass, darkly; but then face to face: now I know in part; but then shall I know even as also I am known.
And now abide faith, hope, charity, these three; but the greatest of these is charity.

Mohammed’s example is dismal. No need to go into specifics here. But he is held up as the example for all to follow.

Many Muslims (as people like me get sore throats from repeating) are fine, honest and peaceful people. Many Muslims are probably better people than they would be without a belief in an all-knowing God (as taught by the Koran). Many Muslims are better people than many who call themselves Christians. Every Muslim is made in the image of God. Islam is God’s religion? I don’t think so.

Premier Foods

Premier Foods, the largest food manufacturer in this country has been revealed to be requiring its suppliers to pay for the privilege of remaining suppliers. This seems to me to be morally problematic.

The whole point of free markets is that they are free. Individuals and firms are free to make whatever deals they wish – provided no coercion or deception is involved. Trade is agreement: in exchange for x I am prepared give y. If you are prepared to accept y and to part with x, we have a deal. In 99% of all cases this not problematic. But if I pay you to inflict undeserved violence on a third party, we have a problem.

Superficially, at least, the details of the deal concern no one but the participants – provided no third party is harmed. No one will be harmed if John pays Interflora to deliver roses to Mary. Mary’s husband may not be best pleased; but that is not Interflora’s fault, even if John is a home wrecker.

In a more complicated situation, where Premier Foods demands not only acceptable price, quality and delivery/credit terms in exchange when it agrees to pay for corn starch (or whatever), but an additional sweetener, the waters are muddied. But is anyone cheated or coerced? Other (unsuccessful) suppliers may be grumpy about the situation – just as they may be grumpy about the successful supplier’s ability to offer appealing credit terms. It’s not clear that any principle has been violated.

What about the very common case of a salesman using his expense account to wine and dine representatives of the company with which he is wishing to do business? My instinct is that this is OK, within limits. What limits? If (instead of champagne and caviar) the inducements are luxury holidays, have we gone beyond the limits? The inducements are (ultimately) paid for by the customer. My instinct is not a moral principle.

In the case of an aircraft manufacturer paying millions to a government employee to secure a government contract, the consensus seems to be that this is well beyond the limits – the manufacturer and the government employee are in fact defrauding the customer. The customer pays (maybe) billions but gets (maybe) an inferior product. In most democracies an offence has been committed – corruption.

I am no closer to making my mind up on the principle than when I began. I’m not sure if, in the case of Premier Foods, any principle has been violated. However, it does seem to me that transparency is desirable. If the supplier has to pay for the privilege of supplying, he has fewer resources to devote to improving quality and lowering prices – the genius of capitalism.

In ordinary transactions money goes one way, goods and services go the other.

Subjectively, I am against this way of doing business. But I’m still not sure about the principle. What think you?

Tuesday, 2 December 2014

Conversation with Sam

Skype is amazing. I have just had a two hour conversation with Sam in Singapore. It cost us nothing!

Almost inevitably, we spoke of Sam Harris, the neuroscientist who disbelieves in Free Will but does believe in Moral Absolutes.

Moral Absolutes          Yes!
Free Will                     No!

In his book The Moral Landscape Harris attempts the impossible: deriving ought from is. It is a geometrical truth that squaring the circle is a mathematical impossibility; a logical truth that obligations cannot be derived from observations alone.
David Hume says in A Treatise of Human Nature, 1739:

In every system of morality, which I have hitherto met with, I have always remarked, that the author proceeds for some time in the ordinary ways of reasoning, and establishes the being of a God, or makes observations concerning human affairs; when all of a sudden I am surprised to find, that instead of the usual copulations of propositions, is, and is not, I meet with no proposition that is not connected with an ought, or an ought not. This change is imperceptible; but is however, of the last consequence. For as this ought, or ought not, expresses some new relation or affirmation, 'tis necessary that it should be observed and explained; and at the same time that a reason should be given; for what seems altogether inconceivable, how this new relation can be a deduction from others, which are entirely different from it. But as authors do not commonly use this precaution, I shall presume to recommend it to the readers; and am persuaded, that this small attention would subvert all the vulgar systems of morality, and let us see, that the distinction of vice and virtue is not founded merely on the relations of objects, nor is perceived by reason.

The great stylists of the past did us no favours with their rolling periods. Have I been unjust to Hume?

Peter Singer has called the problem ‘trivial’. Is it really trivial how we arrive at moral positions? Singer tells us that he has no problem with parents killing their children if they (the children) do not satisfy the parents’ expectations. My Sam (an expectant father) is not a Singerian.

Harris does a fine job of describing desirable outcomes, which come under the heading of Human Flourishing. I think I had a pretty good idea of what it means for a human to flourish before reading him. I think I also knew that promoting human flourishing was not just a good idea but moral. Harris did nothing to help me to move from HF to ‘morality’. Hume knew that it was logically impossible. I was there already. Harris is redundant. The gap between is and ought is not reduced by a millimetre.

There are moral facts: cruelty is bad, generosity is good. I need no proofs to convince you – or even evidence.

SH says that Free Will is simply an illusion – it’s a lie. But, and my Sam agrees with me, we have no choice but to act as though we have free will. I am an acting agent – so are you – so is SH. But by acting and at the same time believing that I have no free will I would be living a lie. Incidentally, Sam Harris is against lying. He wrote a whole book about it: Lying. For sure, I may not be aware of everything that conditions my choices – no surprise there. Harris does not tell me that I can ignore my conscience (he believes in good and evil) only that it doesn’t really mean anything. He is telling me that something I experience cannot be experienced because it is illusory.

In effect, he is telling me that the entity I call ‘I’, an acting agent who makes choices, does not exist. He tells me that I do not exist! This implied assertion (of my none-existence) seriously undermines his credibility (at least in my eyes). He is not a solipsist, one who believes that only he exists and that all other phenomena are the products of his mind; but his metaphysical propositions are equally incapable of demonstration and equally suspect.