1. image: Download

    It is important to remember…

    It is important to remember…

     
  2. c4ss:

    Global restrictions on migration are holding the world economy back by two decades. The economic loss we suffer every single year as a result of governments’ arbitrary barriers on labor mobility is equivalent to the next 20 years of economic growth.

    Simply put, lifting restrictions on immigration woulddouble world GDP.We can get a headstart on the future by abolishing arbitrary restrictions on immigration today.

    What does that mean in practical terms?

    Gross Domestic Product (GDP) is the total value of all final goods and services produced within a country during a year. Basically, it is the amount of stuff being produced by your country–food, cars, clothes, legal advice, etc.–each year. GDP per capita means the total value of your country’s output divided by the number of people, and it’s often used as a rough measure of standard of living: the more stuff your country produces per person per year, the better off you are likely to be. …

     
  3. The truth is we are all living on Benefits Street | Simon Jenkins

     
  4. Rothbard on Man, Economy, and State

    1. AEN: How did Man, Economy, and State come to be?
    2. MNR: It ended up totally different from the way it started. After Mises had written Human Action, the Volcker Fund—which promoted classical liberal and libertarian scholarship—was looking for a college textbook that would boil it down and spell it out. Mises hardly knew me at the time since I had just started attending his seminar. I wrote a sample chapter, "Money; Free and Unfree." They showed it to Mises and he gave his endorsement. I then received a many-year grant to work on it. I thought it was going to be a textbook. But it grew and grew. New material kept coming in. As I kept going, I found ideas Mises had left out, or steps that were implicit in Mises that needed to be spelled out.
    3. I gave periodic reports to the Volcker Fund. Finally they asked me; "Look, is this going to be a textbook or a treatise?" When I delivered a 1,900-page manuscript, they knew the answer. Power and Market was the final chapter called "The Economics of Violent Intervention." They asked me to cut out it out because it was too radical. It was published separately years later by the Institute for Humane Studies.
    4. AEN: Did you write the book in sequence?
    5. MNR: Yes. I started with page one with methodology and it wrote itself.
    6. AEN: Did anything get left out of the final book?
    7. MNR: I took Chapter 5 out of Man, Economy, and State, which included the usual cost-curve analysis. I wrote the whole chapter before I realized that the approach I was taking was nonsense. So I started over.
    8. AEN: Is there any doubt that Mises was your primary influence?
    9. MNR: I didn't think so, but Joseph Salerno once gave a talk in which he said Man, Economy, and State is more Boehm-Bawerk-oriented than Mises's Human Action. I never thought of it that way, but it may be true. When I was spelling out capital theory, I used Boehm-Bawerk primarily. I didn't think about it since I thought Mises was a Boehm-Bawerkian and didn't see any contradiction. I would like to see Professor Salerno explore this. It's an example of the way a historian of economic thought can show something about a person's work that he himself didn't realize.
    10. AEN: How many years were involved from the time you started working on Man, Economy, and State to the time it was published?
    11. MNR: This is complicated. I received the grant in 1952, but shortly afterwards I had to finish my doctoral thesis under Arthur Burns. From 1953 to 1956 I was working partly on both. I finally finished Man, Economy, and State in 1960 and it was published in 1962.
     
  5. We hear a lot from the government about ‘affordable’ housing, ‘affordable’ healthcare, ‘affordable’ education. You and I think of ‘affordable’ as meaning ‘people can afford to buy it’. But yet, when housing prices started to fall several years ago, you would think that Barney Frank would be happy about this. Now we can finally have affordable housing. And yet, they treated the fall in housing prices like the return of Godzilla. Because, for them, ‘affordable’ doesn’t mean ‘low prices’. For them, ‘affordable’ means ‘high prices, caused by government involvement, but then we give a loan to help pay the high prices and we call that affordable’. So, we make you a debt-slave, and that’s the equivalent of ‘affordable’.
    — Tom Woods (via eltigrechico)
     
  6. amateurpolymath asked: Why is gold so much better than fiat money? It has few industrial applications, and very little is needed to make a large quantity of jewelry. If we want money to have value outside its use as money, wouldn't a titanium/copper/etc. standard be preferable?

    hipsterlibertarian:

    areyouafraidofthedarknjl:

    hipsterlibertarian:

    The basic rules of determining what can be used as money are this:

    • A lot of people have to want it — otherwise there’s no point
    • It should be relatively portable — i.e. small quantities have value, because you don’t want to carry around a wheel-barrow full of stuff just to go buy milk
    • It should be durable — so trading doesn’t become a game of hot potato
    • It should be easily verifiable — so counterfeiting is not a constant worry
    • It should be protectable — I know that’s not a word, but you get the idea

    Other characteristics could no doubt be added to this list, but you get the basic idea. 

    Now, gold has historically been a popular substance for money because, for better or worse, it fits the criteria:

    • It has value because people think it has value. That’s what matters. The human race has a long-standing fascination with gold, regardless of utility. It’s pretty, and we value it. (This is where baseless paper money fails, by the way — we only value it as only as the organization saying it has value sticks around; once that organization goes away, it’s just a novelty item.)
    • Small amounts are valuable, making it portable.
    • It’s malleable as metals go, but pretty sturdy in the grand scheme of things, so it’s durable.
    • It’s easily verifiable. As a metal, it has a specific melting point, weight, feel, etc. which allow us to pretty quickly (and using pretty primitive tools) determine if it’s real.
    • It’s protectable. It’s inanimate, and small amounts are valuable. This is something we can easily hide and/or hold on to.

    That said, there’s no reason why we have to stick to gold in particular. Certainly other metals or commodities could be used as a basis for money, especially if certificates were issued (as would be practically necessary for lower value metals, like copper).

    But old habits die hard, and I don’t see humanity’s love affair with gold going away any time soon.

    So, you just stated why gold is no different than fiat money…

    No, the difference is this:

    • If the American government disappeared tomorrow, the dollar would be worthless — just like marks from Wiemar Germany or Zimbabwe’s currency now that Zimbabwe’s government no longer supports it. No one values baseless paper money without being told to by law, because it is not a commodity. 
    • If the American government disappeared tomorrow, people would still value gold. Gold’s value is subjective, yes, but it’s a subjective value which people decide for themselves, independent of legal requirements.

    This is much more comprehensive than my usual comment of it being precious because it’s difficult to obtain and finite.

     
  7. image: Download

    putthison:

Expensive Things: Not Getting Any Cheaper
For years I’ve put off buying one of J. Press’s “Shaggy Dog” shetland sweaters—the fuzzed, Scotland-made wool crewneck that’s a winter standard at Press, that most glacial of men’s stores. I first handled one in the D.C. Press store in 2006 (I think; that’s when I discovered we had a J. Press here), and even bought one as a gift, but always figured I’d pick one up for myself when I had a little extra cash or when sale season hit.
In the meantime I’ve recommended the sweaters as an unassailable classic—made well and in the traditional country of manufacture, resistant to both chilly fall breezes and trends, even a good value at $165. Well, $165 in 2010. $165 in 2009, too. In 2013? $230. You can pay another $15 for the York Street version, although it’s not immediately clear what that buys you.
Clothing prices are significantly outpacing inflation, with men’s clothing leading the way. Anecdotally, I’ve heard this attributed to raw material price increases (e.g., cotton and wool) and the scarcity and increasing expense of quality manufacturing. The takeaway here isn’t necessarily “buy more now”; it’s risky if not foolish to treat clothing as you would treat a financial investment, although thoughtful consideration of how much value you get out of your clothing can help determine what’s affordable for you. The truth, though, is that what’s not affordable for you now is not rushing to become affordable for you in the near future.
-Pete

The #menswear X economics nexus.

    putthison:

    Expensive Things: Not Getting Any Cheaper

    For years I’ve put off buying one of J. Press’s “Shaggy Dog” shetland sweaters—the fuzzed, Scotland-made wool crewneck that’s a winter standard at Press, that most glacial of men’s stores. I first handled one in the D.C. Press store in 2006 (I think; that’s when I discovered we had a J. Press here), and even bought one as a gift, but always figured I’d pick one up for myself when I had a little extra cash or when sale season hit.

    In the meantime I’ve recommended the sweaters as an unassailable classic—made well and in the traditional country of manufacture, resistant to both chilly fall breezes and trends, even a good value at $165. Well, $165 in 2010. $165 in 2009, too. In 2013? $230. You can pay another $15 for the York Street version, although it’s not immediately clear what that buys you.

    Clothing prices are significantly outpacing inflation, with men’s clothing leading the way. Anecdotally, I’ve heard this attributed to raw material price increases (e.g., cotton and wool) and the scarcity and increasing expense of quality manufacturing. The takeaway here isn’t necessarily “buy more now”; it’s risky if not foolish to treat clothing as you would treat a financial investment, although thoughtful consideration of how much value you get out of your clothing can help determine what’s affordable for you. The truth, though, is that what’s not affordable for you now is not rushing to become affordable for you in the near future.

    -Pete

    The #menswear X economics nexus.

     
  8. thinksquad:

Fiat Currency

Fun!

    thinksquad:

    Fiat Currency

    Fun!

     
  9. veilofmaya13:

    How can one combine professional life with the advancement of liberty? Of course it is presumptuous to offer a definitive answer since all jobs and careers in the market economy are subject to the forces of the division of labor. Because a person focuses on one task doesn’t mean that he or she isn’t great at many tasks; it means only that the highest productive gains for everyone come from dividing tasks up among many people of a wide range of talents.

    So it is with the freedom movement. The more of us there are, the more we do well to specialize, to cooperate through exchange, to boost our impact by dividing the labor. There is no way to know in advance what is right for any person in particular. There are so many wonderful paths from which to choose (and which I will discuss below). But this much we can know. The usual answer — go into government — is wrongheaded. Too many good minds have been corrupted and lost by following this fateful course.

    If often happens that an ideological movement will make great strides through education and organization and cultural influence, only to take the illogical leap of believing that politics and political influence, which usually means taking jobs within the bureaucracy, is the next rung on the ladder to success. This is like trying to fight a fire with matches and gasoline. This is what happened to the Christian right in the 1980s. They got involved in politics in order to throw off the yoke of the state. Twenty years later, many of these people are working in the Department of Education or for the White House, doing the prep work to amend the Constitution or invade some foreign country. This is a disastrous waste of intellectual capital.

    It is particularly important that believers in liberty not take this course. Government work has been the chosen career path of socialists, social reformers, and Keynesians for at least a century. It is the natural home to them because their ambition is to control society through government. It works for them but it does not work for us.

    In the first half of the 20th century, libertarians knew how to oppose statism. They went into business and journalism. They wrote books. They agitated within the cultural arena. They developed fortunes to help fund newspapers, schools, foundations, and public-education organizations. They expanded their commercial ventures to serve as a bulwark against central planning. They became teachers and, when possible, professors. They cultivated wonderful families and focused on the education of their children.

    It is a long struggle but it is the way the struggle for liberty has always taken place. But somewhere along the way, some people, enticed by the prospect of a fast track to reform, rethought this idea. Perhaps we should try the same technique that the left did. We should get our people in power and displace their people, and then we can bring about change toward liberty. In fact, isn’t this the most important goal of all? So long as the left controls the state, it will expand in ways that are incompatible with freedom. We need to take back the state.

    So goes the logic. What is wrong with it? The state’s only function is as an apparatus of coercion and compulsion. That is its distinguishing mark. It is what makes the state the state. To the same extent that the state responds well to arguments that it should be larger and more powerful, it is institutionally hostile to anyone who says that it should be less powerful and less coercive. That is not to say that some work from the “inside” cannot do some good, some of the time. But it is far more likely that the state will convert the libertarian than for the libertarian to convert the state.

    We’ve all seen this a thousand times. It rarely takes more than a few months for a libertarian intellectual headed for the Beltway to “mature” and realize that his or her old ideals were rather childish and insufficiently real world. A politician promising to defang Washington later becomes the leading expert in applying tooth enamel. Once that fateful step is taken, there are no limits. I know a bureaucrat who helped run martial law in Iraq who once swore fidelity to Rothbardian political economy.

    The reason has to do with ambition, which is not normally a bad impulse. The culture of Washington, however, requires that ambition work itself out by paying maximum deference to the powers that be. At first, this is easy to justify: how else can the state be converted except by being friendly to it? The state is our enemy, but for now, we must pretend to be its pal. In time, the dreams are displaced by the daily need to curry favor. Eventually the person becomes precisely the kind of person he or she once despised. (For Lord of the Rings fans, it’s like being asked to carry the ring for a while; you don’t want to give it up.)

    I’ve known people who have gone this route and one day took an honest look in the mirror, and didn’t like what they saw. They have said to me that they were mistaken to think it could work. They didn’t recognize the subtle ways in which they themselves were being drawn in. They recognize the futility of politely asking the state, day after day, to permit a bit more liberty here and there. Ultimately you must frame your arguments in terms of what is good for the state, and the reality is that liberty is not usually good for the state. Hence, the rhetoric and finally the goal begin to change.

    The state is open to persuasion, to be sure, but it usually acts out of fear, not friendship. If the bureaucrats and politicians fear backlash, they will not increase taxes or regulations. If they sense a high enough degree of public outrage, they will even repeal controls and programs. An example is the end of alcohol prohibition or the repeal of the 55 mph speed limit. These were pulled back because politicians and bureaucrats sensed too high a cost from continued enforcement.

    The problem of strategy was something that fascinated Murray Rothbard, who wrote several important articles on the need for never compromising the long-run goal for short-term gain through the political process. That doesn’t mean we should not welcome a 1 percent tax cut or repeal a section of some law. But we should never allow ourselves to be sucked into the trade-off racket: e.g., repeal this bad tax to impose this better tax. That would be using a means (a tax) that contradicts the goal (elimination of taxation).

    The Rothbardian approach to a pro-freedom strategy comes down to the following four affirmations:

    1. the victory of liberty is the highest political end;

    2. the proper groundwork for this goal is a moral passion for justice;

    3. the end should be pursued by the speediest and most efficacious possible means; and

    4. the means taken must never contradict the goal — “whether by advocating gradualism, by employing or advocating any aggression against liberty, by advocating planned programs, by failing to seize any opportunities to reduce State power, or by ever increasing it in any area.”

    Libertarians are not the first people who have confronted the question of strategy for social advance and cultural and political change. After the Civil War, a large part of the population of the South, namely former slaves, found themselves in a perilous situation. They had a crying need to advance socially within society, but lacked education, skill, and capital. They also bore the burden of pushing social change that permitted them to be regarded as full citizens who made the most of their new freedom. In many ways, they found themselves in a position somewhat like new immigrants but with an additional burden of throwing off an old social status for a new one.

    The Reconstruction period of Union-run martial law invited many blacks to participate in politics as a primary goal. This proved to be a terrible temptation for many, as the former Virginia slave Booker T. Washington said. “During the whole of the Reconstruction period our people throughout the South looked to the Federal Government for everything, very much as a child looks to its mother.” He rejected this political model because “the general political agitation drew the attention of our people away from the more fundamental matters of perfecting themselves in the industries at their doors and in securing property.”

    Washington wrote that “the temptations to enter political life were so alluring that I came very near yielding to them at one time” but he resisted this in favor of “the laying of the foundation of the race through a generous education of the hand, head and heart.” Later when he visited DC, he knew that he had been right. “A large proportion of these people had been drawn to Washington because they felt that they could lead a life of ease there,” he wrote. “Others had secured minor government positions, and still another large class was there in the hope of securing Federal positions.”

    As it was in the 1870s it is today. The state chews up and either eats or spits out those with a passion for liberty. The extent to which W.E.B. DuBois’s Marxian push for political agitation has prevailed over Washington’s push for commercial advance has been tragic for black Americans and for the whole of American society. Many obtained political power, but not liberty classically understood.

    We can learn from this. The thousands of young people who are discovering the ideas of liberty for the first time ought to stay away from the Beltway and all its allures. Instead, they should pursue their love and passion through arts, commerce, education, and even the ministry. These are fields that offer genuine promise with a high return.

    When a libertarian tells me that he is doing some good as a procurement officer at HUD, I don’t doubt his word. But how much more would he do by quitting his job and writing an expose on the entire bureaucratic racket? One well-placed blast against such an agency can bring about more reform, and do more good, than decades of attempted subversion from within.

    Are there politicians who do some good? Certainly, and the name Ron Paul is the first that comes to mind. But the good he does is not as a legislator as such but as an educator with a prominent platform from which to speak. Every no vote is a lesson to the multitudes. We need more Ron Pauls.

    But Ron is the first to say that, more importantly, we need more professors, business owners, fathers and mothers, religious leaders, and entrepreneurs. The party of liberty loves commerce and culture, not the state. Commerce and culture is our home and our launching ground for social reform and revolution.

     
  10. For centuries before the science of economics was developed, men searched for criteria of the “just price.” Of all the innumerable, almost infinite possibilities among the myriads of prices daily determined, what pattern should be considered as “just”? Gradually it came to be realized that there is no quantitative criterion of justice that can be objectively determined. Suppose that the price of eggs is 50¢ per dozen, what is the “just price”? It is clear, even to those (like the present writer) who believe in the possibility of a rational ethics, that no possible ethical philosophy or science can yield a quantitative measure or criterion of justice. If Professor X says that the “just” price of eggs is 45¢, and Professor Y says it is 85¢, no philosophical principle can decide between them. Even the most fervent antiutilitarian will have to concede this point. The various contentions all become purely arbitrary whim.


    Economics, by tracing the ordered pattern of the voluntary exchange process, has made it clear that the only possible objective criterion for the just price is the market price. For the market price is, at every moment, determined by the voluntary, mutually agreed-upon actions of all the participants in the market. It is the objective resultant of every individual’s subjective valuations and voluntary actions, and is therefore the only existent objective criterion for “quantitative justice” in pricing.

    — Murray Rothbard, Power & Market

    I was just thinking this myself.