Tag: praxeology

Libertarianism is not Self-Destructive or Unsustainable

By Mason Mohon | @mohonofficial

A recent article by an unknown guest contributor on the Bilan Report suggested that a libertarian society is unsustainable for various reasons. Among these are the ideas that all personal freedom leads to libertinism, individualism is incompatible with the NAP (non-aggression principle), and the supposed libertarian assumption that all governance is bad. The author makes many misconceptions about libertarianism in their article. In response, this piece attempts to set the record straight on libertarian philosophy.

Christianity

The author of this piece starts off the article with an explanation that “there is some level of inherent worth within the individual” from a Biblical perspective. The author then attempts to immediately downplay this importance. They say that a philosophy based entirely on individualism would not work very well.

There is no exact definition of individualism made. From later parts of the article, we can assume the author means that individualism is independence from any organization. The Biblical definition of individualism clearly does not coincide with the latter definition, though. This is because the Bible clearly outlines the importance of being a member of the Body of Christ (1 Corinthians 12:27) and part of the Church community.

Because the Bible also emphasizes the importance of community along with individualism, Biblically deduced individualism as a core of a philosophy would not lead to the disastrous consequences that the author suggests.

Individualism is not the full extent of the Biblical relationship to libertarianism either. In the first part of Bastiat’s The Law, natural rights stemming from life as a gift from God are clearly deduced. I have written on this subject before:

These gifts from God preclude any human legislation and any political leader that has ever existed. This is the core of what exists. These are human rights. Legislation does not define these – nature and nature’s God has. In the garden in Genesis, there was no government. It was anarchy in the truest sense there has ever been, no coercive governing entity. There was only a loving and gift giving God. Clearly there was no legislator dictating how Adam and Eve live their lives through the coercive stroke of a pen. Human legislation cannot ever get underneath this core, but it can restrict it. Restricting it has no benefit though, for any restriction of freedom will stifle economic growth. God set it up this way, to make it the most beneficial for everyone to be free to use their faculties as they wish.

It is foolish to downplay the relationship between the Bible and libertarianism as a few verses alluding to individualism. It goes much deeper and is much stronger. Regardless the author dismisses all discussion on Christian libertarianism by says that “it remains somewhat outside the scope of this discussion of libertarianism as a whole.” This is untrue. Ron Paul is probably the second most convert-gaining libertarian in human history (directly behind Ayn Rand). Bastiat, John Locke, and many of the founding fathers had a faith-based perspective on liberty. But such a statement by the author allows them to get rid of an opposition to their argument. They construct a libertarian strawman that is much easier to attack.

Human Action

The author of this piece also seems to get praxeological insight confused with a moral code as to how man ought to or should act. They mention the action based framework for economics loosely twice in the article:

Taken to its logical conclusion, libertarianism holds that there are no wrong choices, but simply the right to make that choice.

Drawing on heavy Kantian influences they view human action as fundamentally rational, or purposeful.

In Human Action Ludwig von Mises describes that man acts. From this action axiom, along with other synthetic apriori truths (irrefutable statements we learn and know simply from being human), we can deduce the entire science of economics as a subset of praxeology. These other apriori ideas are things such as the law of returns, the law of diminishing marginal utility, time preference, the existence of opportunity costs, etc. These come from the epistemology put forth by Kant which the author alludes to.

The culmination of all of this truth gives us a value-free economics that allows us to understand how the world is and how it works. Praxeological reasoning does not tell us how the world ought to be. It is value-free. It does not aim to. Because of this, the propositions that man faces various choices does not mean that any choice a human chooses is good or moral. The author clearly does not understand that praxeological value free truths do not intersect with libertarian ethical standards from a Misesian perspective.

From a Rothbardian/Hoppean perspective, they eventually do, especially when it comes to the Hoppean argumentation ethics. The author does not address these at all, though, and simply takes the proposition that “man makes choices” to mean that “all choices a man makes are good.” Once again, this is a strawman of libertarian philosophy brought about most likely by lack of understanding of the philosophy.

The NAP

The author then attempts to argue that the non-aggression principle, or NAP, is incompatible with libertarianism:

The principle of limiting coercion is a fundamental aspect of libertarianism but taken in context with the other principles of maximal autonomy and the ability for the individual to reason towards moral and ethical principles, it becomes contradictory. If moral principles are something that can be determined through an individual’s own use of reason how can there be an objective universal principle against coercion?

This reasoning is once again based on a false conception of what libertarianism is. Not a single serious libertarian theorist has ever argued that “an individual’s own use of reason” allows them to come up with their own moral principles. I have no idea where the author got this idea. Libertarianism does not make the slightest attempt to justify any moral standard any individual just dreams up.

If libertarianism did justify such a proposition, it would be extremely flawed. A psychopath could reason their way to a moral standard of murder being ok because it makes them feel good. The reason this is not ok is that the non-aggression principle supersedes individual standards of morality. Libertarian theorist Robert Nozick described the non-aggression principle as a “side constraint” on action. This means that we cannot do things that violate this side constraint.

Think of the rules of soccer: there is the side constraint that you cannot pick up the ball. If you could pick up the ball, it would be helpful for you, because you could through the ball into the goal. This is not allowed in soccer though because it breaks the game. The side constraint of the non-aggression principle breaks the game of reality.

Governance

The author of this piece eventually gets to the point of arguing that libertarian individualism means a complete lack of any sort of social structure. They seem to think that lack of government (a territorial monopoly based on the threat of force) means a lack of governance (an authority based on societal norms or culture). They say the following:

Libertarianism taken to its logical conclusions promotes complete autonomy. This moves beyond simply being unconstrained by positive law and a strict use of only negative law, but liberation from associations and relationships. This includes fundamental institutions such as, “the family, church, and schools to the village and neighborhood and the community broadly defined—that exert strong control over behavior largely through informal and habituated expectations and norms.”14  Ironically, the rejection of institutions and concepts that have traditionally reigned in human behavior creates a further need and additional calls for the state to intervene to regulate bad behavior. This contradiction can play out as legislation mandating acceptance of, or at least association with, behaviors that would be rejected by natural law.

While the radical individualism of Objectivists does reject the idea of any sort of cultural governance, most libertarians (often right-libertarians) see it as an important staple as a free society. Families, churches, and cultural communities are important modes of organization that can exist outside of the state. Jeff Deist expertly explains the importance of such social institutions in this video:

A libertarian society does not reject these complex social institutions. Rather, it upholds these institutions, while a society with a growing state tears these down in favor of itself. The author seems to think that liberty leads to lack of organization, causing a need for the state. The situation is constructed in an entirely backward manner, though. The state seeks to grow in power. It would rather the people become reliant on it rather than their families or churches.

The wearing away of a traditional reliance on such institutions and customs, Deneen argues, will lead to a breakdown of functioning society. Instead of creating a society based on non-aggression and free transaction, best fulfilling the desires of its people, libertarianism tends to isolate the individual and break down the institutions that maintain a proper society.

The author of this piece does not understand what being a freely acting individual means. They seem to think it means being a freely acting individual outside of the influence of anyone else. But society does exist. And it is made up of individual people. The only alternative to this radical independent individualism in the eyes of the author is the state. But as we have explained the state is the true cause of the denigration of these important social institutions.

Liberty and Responsibility

Now we will move onto the final question of libertarian libertinism. The author makes the proposition that the non-Christian libertarianism spirals into responsibility free left-libertarian hedonism. Yet at the same time, the author quotes Ayn Rand and Murray Rothbard as major representatives of the libertarian philosophy. Neither of these individuals was for hedonism. Both of them were against libertinism.

Ayn Rand’s philosophy is based completely around being responsible for yourself. Murray Rothbard and libertarians in the Rothbardian tradition recognize the importance of responsibility on a society. I have written recently on this matter of responsibility and how it is very important to combat libertine libertarianism.

Freedom means we do not have the right to encroach on the actions of someone else. But freedom also means you need to be responsible for your own actions. It means you need to better yourself without the force of the government. Christian libertarianism is not the only political framework that promotes responsibility. And the answer to libertinism sure as hell is not more state power. It is the promotion of a culture of responsibility.

Libertarian theory is not self-destructive. A libertarian social order is not as unsustainable as this author believes. They think that their strawman version of libertarianism would be horrendous. But it is a strawman and not an accurate representation of libertarian belief.

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Milton Friedman: One of the Great Libertarians

By Roman Bilan | United States

Murray Rothbard was born in 1926 and died in 1995. Milton Friedman was born in 1912 and died in 2006. Their careers almost entirely overlapped, yet one left a lasting influence on the free world, while the other died in more or less absurdity. Rothbard only influenced his own cult-like following, yet many of his anarcho-capitalists rather “throw out” Friedman’s libertarian legacy.

When it comes to twentieth century figures within the libertarian movement, there may no greater figure when it comes to influencing economics, the public, American public policy and the lives of millions.

Milton the Economist

Milton Friedman’s contributions to the science of economics cannot be understated. He was the figurehead of the Chicago School, a free market oriented school of economic thought based out of the University of Chicago. Alongside him were his prominent colleagues, Frank Knight, Ronald Coase, and Robert Lucas, to name a few.

The entire field owes a huge debt to Friedman and his crew. He overturned many of the prevailing errors brought about by the Keynesian Revolution: most notably with his critique of the Phillips Curve. Even Paul Krugman admits that Friedman did the science a great service with his contributions and critique of former Keynesian orthodoxy:

“Friedman’s critique of Keynes became so influential largely because he correctly identified Keynesianism’s weak points… I regard him as a great economist and a great man.”

-Paul Krugman

Regardless of how you feel about his political inclinations, he believed in them because of his economic thought. And his thought is arguably one of the most profound things to be produced in the 20th century. It is completely unfair to dismiss, much less “throw out,” someone because of minor disagreements on theory. Friedman is one of the greatest intellectuals of his time and libertarians should wholeheartedly embrace him as one of their own.

Milton the Public Intellectual

As was written in his obituary for FEE, “Friedman did more than any single person in our time to teach the public the merits of deregulation, privatization, low taxes, and free trade. His work inspired the economic agendas of President Ronald Reagan and British Prime Minister Margaret Thatcher, as well as the liberalization of economies in eastern Europe and the former Soviet Union.”

Take Capitalism and Freedom, for example. Read by over half a million in eighteen different languages, it introduced ideas like school vouchers and pushed for lower and flatter taxes.

Similarly, Free to Choose was the best selling nonfiction book in 1980 and was watched by millions. Only F.A. Hayek could boast a similar public reach for a libertarian.

Additionally, Friedman wrote over 300 op-eds for Newsweek, 121 op-eds for the Wall Street Journal and another twenty-two for the New York Times. But maybe he would have been been better off preaching to the libertarian choir instead of engaging with the public at large?

Milton Ends the Draft

In 1940, the United States began its third and final draft. On March 27, 1969 President Richard Nixon formed the Gates Commission to look at the possibility of an All-Volunteer Armed Forces– Friedman was one of its most prominent members. The commision of fifteen members had five members in favor of an all-volunteer armed forces while the other ten were split evenly between being against the idea and neutral towards it. In less than a year, the Commission came to a unanimous 14-0 recommendation (one member was unable to vote on the specifics, although he did support an all-volunteer military) to end the draft.

Three years later, the draft was gone.

Milton Influences Estonia

On August 20, 1991, Estonians left the darkness of the Iron Curtain and joined the free world as the Republic of Estonia replaced the Estonian Soviet Socialist Republic. Mart Laar was the first Prime Minister of Estonia after the interim government. He led from 1992 to 1994 and again from 1999 to 2002. As noted in Foreign Policy,

“In barely two years, from 1992 to 1994, the radical reforming Estonian government of Mart Laar introduced a flat tax, privatized most national industry in transparent public tenders, abolished tariffs and subsidies, stabilized the economy, balanced the budget, and perhaps most crucially, restored the prewar kroon and pegged it to the rock-solid deutsche mark. As a result, Estonia became one of the most open and transparent economies in Europe, and with growth came political stability: Russian troops left the Baltic region by 1994, fears of Balkan-style ethnic conflicts receded, and Soviet noncitizens in Estonia and Latvia began to assimilate.”

Before Laar became Prime Minister he read one book: Free to Choose by Milton Friedman. A few years later, he was in D.C., talking with US Representative Dick Armey. Armey asked how the Estonian government was able to be so successful with their free market reforms. Laar’s answer was simple, “We read Milton Friedman and F. A. Hayek”.

Milton Friedman: Common Complaints

No, Milton Friedman was not an Austrian, but Austrian Economics is not synonymous with libertarianism. Libertarians can be non-Austrian and Austrians can be non-libertarian.

No, Milton Friedman did not believe in Praxeology, but Praxeology is also not a necessity for libertarianism, nor is its veracity without question. Even F.A. Hayek, Ludwig Von Mises’s greatest student, broke from Praxeological orthodoxy.

No, Milton Friedman is not an anarcho-capitalist. He believes in a state, but anarcho-capitalism is only one part of the broader libertarian ideology. As Hayek said, “Our general views on what is desired and what is not are almost identical until we get on to money.”

The greatness of a libertarian should not be defined by their purity, but by how much they advance liberty. Libertarians like Murray Rothbard win the purity test but do little to advance libertarianism. As Paul Krugman wrote in 1994, Friedman waged a campaign “Goliath of Big Government” that “eventually bore fruit in radical changes in both economic ideology and real-world economic policy.”

Whether it be his direct or indirect influence on Republican administration, pushing free market policies in other countries, advocating for drug legalization, getting the state out of education, loosening licensing laws, giving less power to central banks or cutting taxes and spending, Milton Friedman’s legacy is one of promoting freedom and liberty. Thus, libertarians should be proud to share an intellectual home with him.


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Throw Out Milton Friedman

By Mason Mohon | @mohonofficial

I think it’s pretty clear that Friedman is a statist. -Murray Rothbard

Milton Friedman is popular, and not just “libertarian popular” (although he is) but mainstream popular. His book Capitalism and Freedom has over half a million sales and Free to Choose has also had its fair share of economic and political influence. I have spoken to many fellow lovers of the free market and many have stated he was their primary influence in pushing people towards libertarian ideology.

While more proponents of the free market is a great thing, Friedman’s worldview of classical liberalism is inconsistent and his economic methods are needlessly faulty. The Friedmanite economic worldview is lacking and has multiple barriers if we ever wish to proceed towards our goal of reaching a free society.

The first issue with Friedman and his intellectual influence is the method he goes about economics. To quote from his Essays in Positive Economics:

The ultimate goal of positive science is the development of a “theory” or “hypothesis” that yields valid and meaningful (i.e. not truistic) predictions about phenomena not yet observed.

What this basically means is that economic science should act like the hard sciences, in that we should make a hypothesis and go out into the world and test it. To Friedman, economics seems to be analogous to Chemistry or Physics.

At the same time, this small statement seems to have a bit of a call back to the positivist claim that only empirically verifiable statements are meaningful. Hence, statements that have purely logical backing, rather than empirical backing, are meaningless. This poses an obvious issue to adherents to the Austrian School of economics, for reasons that I will get into shortly.

He goes on:

Tautologies have an extremely important place in economics and other sciences as a specialized language or “analytical filing system.” Beyond this, formal logic and mathematics, which are both tautologies, are essentially aids in checking the correctness of reasoning.

But economic theory must be more than a structure of tautologies if it is able to predict and not merely describe the consequences of action; if it is to be something different than disguised mathematics.

Let us tackle the original claim that merely logically backed claims cannot be meaningful. Mathematics is a logically backed field of study, full of theorems that are not true because we went out and tested a hypothesis, but rather because we can think them through and based on logical thinking we can work through the issue and know it to be true.

The adherent to praxeology understands that the law of diminishing marginal utility is a valid theorem, not because we go out in the world and watch as people value each additional unit of a good less. We don’t start to count the percentage loss in psychic utils that people begin to attain. No! That wouldn’t make any sense!

We know the law of diminishing marginal utility to be true because it is a logically consistent theorem. It is why people will pay more for diamonds than they will for water. Because there is so much water that nobody cares if they sell a bottle for a dollar fifty. But there are so few diamonds that they can be sold for extreme prices, even though water is so much more critical to human life.

If praxeological reasoning doesn’t back this up, then what does? Why is this economic theorem valid if not for the reasons of praxeology? Friedman surely didn’t have an answer.  As Robert Murphy says in Choice:

He hasn’t demonstrated why economic theory must “be able to predict” in a way that is different than merely describing “the consequences of action.”

Milton Friedman really had no backing for his attacks on the arguments on praxeology. But he couldn’t change positions, because how would he keep his blessed government ties if he didn’t remain in the field of mainstream economics.

This ties into the second issue with Milton Friedman. Milton and his Friedmanites have no real theory of justice or the state or what its limits should be. Sure, he talks about classical liberalism at the beginning of Capitalism and Freedom, but he makes no efforts to define the ethical bounds of such a belief system and how far it should hold back the government.

Therefore, the state then becomes a sort of deus ex machina of his economic world. When an issue isn’t worth thinking through, boom, just let the state take care of it. His son, David, did a much better job of this, thinking through every aspect of statist policy and realizing the private market could do so much of a better job.

As Murray Rothbard said in his interview with The New Banner:

I mean, if you are in favor of the state having control of the money supply, control of the education system, and a guaranteed annual income, that’s it. There is not much more that can be said. The fact that the Friedmanites are against price control is all very well, and I hail that, but the fundamental aspects of the state remain. The state still commands the highposts of the economy.

This is one of the problems with Friedmanites — they have no political theory of the nature of the state. They think of the state, and this is true of Milton and the whole gang as far as I can see, as another social instrument. In other words, there is the market out here and then there is the state, which is another friendly neighborhood organization. You decide on which thing, which activity, should be private and which should be state on the basis of an ad hoc, utilitarian kind of approach. “Well, let’s see, we’ll feed the thing through the computer. We find that the market usually wins out, that the market is usually better.” So, most of the time they come out in favor of the market on things like price control or government regulations, but they really think of the state as just another social instrument. And so when they come out in favor of the state, they go all out.

There is really no limit in the eyes of Friedman and his followers as to how far the state should actually end up going. A strong proponent of the free market should always make the assumption that the market is going to do better and there should be a steep burden of proof for the government to take control of any system.

Milton contributed quite a few things to economics. But he should not be praised, and his everyone word should not be followed. His classical liberalism is hollow and his economic methods are weak. Read his works, there’s some good stuff in there. But nobody should consider themselves a “Friedmanite.”


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Why Does Socialism Starve People?

By Mason Mohon | USA

It comes up in every single debate. We see it every time we are arguing with a communist or another sort of lefty. The right-wing proponent will throw out instances like Venezuela, the Soviet Union, and other catastrophic failures of socialist economies. This is followed by the response from the left-winger that either those were not real communism/socialism, or that there are factors that the right-winger fails to realize. In reality, both of these arguments are really bad. We cannot throw out death counts and assume they are causally related to the institution of socialism. What must be explored is economic law, and we need to look at what sort of incentives a socialist economy creates, and whether or not it is compatible with human actors.

In this article, socialism and communism will be used interchangeably because they both fit the definition of a planned economy.

We must first look into how we are supposed to study economics. The beginning of all economic thought comes from logical deductions coming from the action axiom. That is, we begin all economics with the axiom that man (human) acts. It is why Mises termed his magnificent economic treatise Human Action, and it is the starting point the Austrian School of economics comes from. This article is not to explore all of the warrants behind this line of thought, though. For an in-depth explanation of praxeological reasoning, I recommend the “Chapter Zero” of Chase Rachels’s book A Spontaneous Order, which is written by Will Porter and titled Epistemology and Praxeology. Within it, it is explained why we begin here and has refutations of the opposition.

What is important, though, is that we deduce economic law logically, not through reflecting upon history. This is not to say that history is not important, for it can prove itself to be an important tool in many instances, but all too often will people interpret history one way, which goes directly against logical deductions, one example being the second industrial revolution. Economic law cannot be deduced from history, it can only be reflected on and compared.

What this means to the present situation is that it goes directly against what it means to be a student of economics to say that “the Soviet Union had starving people, and because of that socialism/communism must lead to starvation.” We cannot use a historical example as an economic law. Rather, we must look to what economic law says and the reasoning behind why it says what it says. Once we have done this, then we may say that socialism is causally related to starvation and mass death. It is simply not enough to make claims about historical repetition.

Now, we may look at the economic issues with socialism. The argument will take its form in three planks: how socialism will cause misallocation, how socialism will incentivize people to produce, and how socialism will incentivize people to climb society.

In the first place, we must look at why socialism causes misallocations. These misallocations are the causes of the shortages of food and resources we associate with socialism. It is often objected that instances where this misallocation did occur, it was “not real socialism” or “not the right brand of socialism.” The problem is that misallocations will occur in any instance where the factors of production are no longer privately owned, which is the defining characteristic of socialism. In any economy, to determine whether or not an entrepreneur or producer is engaging in fruitful, efficient, and socially productive action, they must engage in economic calculation. This is the action of seeing whether or not their initial investment has created a profit or a loss. If an entrepreneur or producer discovers they have suffered a loss (people are not buying what they are providing), they discover that it is not good for resources to go where they are putting them. In a socialist economy, no economic calculation can exist, because market prices are nonexistent. Because of this, there is no way to discover whether or not resources are going to the right places. With something like food, it is extremely important that we figure out if it is going to the right places. To read more into how entrepreneurs serve society, I recommend this article.

Now that we have established the economic law proving socialism to misallocate resources, we can look at history and the world around us to see this being reflected. Socialist commonwealths across the globe have fallen apart. It is why there was no food in the Soviet Union, and it is why Venezuela failed to properly utilize its oil, resulting in profound economic decline. Some economies may seem to be socialist and successful, but those are instances in which we are either misunderstanding what their economy is, or they are purely surviving off of luck, meaning enough resources to keep the country from collapsing have been delegated, but there is no way to know what kinds of losses this is and will be producing without economic calculation.

Furthermore, we must look at the incentives to produce that are produced by a socialist economy. In Hans-Hermann Hoppe’s critique of socialism in his book Democracy: The God That Failed, he explains the ways wealth can be created within an economy. There are three, the first of which being mixing your work with untouched land. The second is to produce the good by combining or changing resources, and the third is by transferring a good through voluntary and contractual means. If the ownership of all assets is assigned to the collective (or the state), then individuals who mix their work (or homestead) with land, individuals who produce, and individuals who exchange lose their incentive to create wealth, because anything they create they will not own, for the collective (or the state) shall assume ownership. The cost of performing fruitful tasks is raised, and those that do not act productively still benefitted, increasing the incentive to not work (to each according to his need).

Moreover, we must look at the paths available to people to get to the top of society. In a capitalist free-market society, the best way to climb to the top is by starting a business and serving consumer needs. As Dr. Hoppe said, if one “wants to increase his wealth and/or rise in social status, he can only do so by better serving the most urgent wants of voluntary consumers through the use he makes of his property.” Clearly, the way to raise your own social status in a private property order is to serve others, making selfishness ultimately selfless. A socialist order stands in stark contrast, for to rise one must appeal to the collective or whoever elects people into the state. Doing this promotes cutthroat dirty politics, and it forces one to rise through “promises, bribes, and threats.” This has clearly been reflected throughout the world of big government and socialism, for Soviet Union leadership was given to whoever could stab the most people in the back in the end.

In conclusion, it is important that we know the causes of socialist terror. It is not logical or economically sound to make quick assumptions about starvation in the past and claim socialism and communism are failures. Rather, we must make praxeological economic deductions from the basis that man acts to determine whether or not socialism will work. The results are in strong opposition to socialism, which causes misallocations, laziness, and dirty politics. In the end, the results are catastrophic, and history only stands to prove.