Search Results

Keyword: ‘avatar’

Fun exploration of limited liability corporations, and of anarchist community, with “principled libertarian” Stephan Kinsella

February 20th, 2014 No comments

I haven’t been in communication with anti-IP stalwart and occasional sparring partner Stephan Kinsella for some time (I lost my appetite for his hostility), but I saw him recently on Facebook, where he had reposted a review he had done of the movie “Avatar”; as I had liked his review, I stopped by to say hello. [Note: my various #Avatar-related posts, from my blogging/commenting days at the Mises Institute, are here: http://tokyotom.freecapitalists.org/?s=avatar.]

What follows are his Facebook post and our ongoing dialog to date (some other persons also appear; cross-links after the name); stay tuned!

1. Kinsella (Feb 12 at 10:54 pm)

I confess, I am not the a very good movie reviewer. When I occasionally do one, they start looking dated within months. Anyway, I remember this one from 2009. I got tons of grief for it from fellow libertarians, e.g., if I recall, Michael Barnett.

http://www.lewrockwell.com/lrc-blog/avatar-is-great-and-libertarian/

2. TokyoTom (Feb 13 at 2:52 pm)

I didn’t give you any grief about it, Stephan – in fact I praised you for it – but then I’m a good statist, like you:
http://tokyotom.freecapitalists.org/2009/12/22/envirofacist-avatar-comments-quot-avatar-quot-resources-property-rights-corporations-government-enabled-theft/

3. Andy Katherman (Feb 13 at 11:51 pm)

Great movie review Stephan. I wrote something very similar back in 2010 on my blog (http://www.libertyforlaymen.com/…/natural-law-take-on…). Mind you, I was in my anarcho-libertarian “infancy” and more of a minarchist/Constitutionalist back then.

It’s funny James Cameron is probably more of a pinko-commie-ish-enviornmentalist than a libertarian, but I had the same reaction in that he actually presented a brilliant case for the necessity of property rights and lockean homesteading than pretty much any other movie that comes to mind… all the while doing it with great visual effects and a pretty decent plot!

4. TokyoTom (Feb 14 at 8:32 am)

Andy, Cameron wasn’t presenting a brilliant case for the necessity of property rights and lockean homesteading, but an allegory for the reality of corporate resource development around much of the world where native title is ignored, and a fantasy of natives fighting back. Of course it’s a more tangled reality, with governments frequently involved, wanting royalties, and arrogating rights to balance interests. BP and the Gulf of Mexico and the Kochs, Albertan oil sands and Keystone, for example.

5. Kinsella (Feb 14 at 8:43 am)

why add the word “corporate” Tom? What does that add to anything. There is nothing inherent in corporations that makes them more likely to violate rights. It’s just a form of business organization.

6. Andy Katherman (Feb 14 at 3:30 pm)

Disagree “TokyoTom”. I concede Cameron is probably an eco-nut of the “watermelon” variety (green on the outside, commie red on the inside) and has disdain for commerce, free markets, and “Capitalism” (properly understood)… and may not even care about property rights. But, the movie really is a terrific demonstration why property rights are a vital normative concept to reduce conflict over scarce resources. And, it also provided a case why aggression is Bad and why self-defense of homesteaded land/property/resources (Home Tree) is good and JUST. Yes, it is an allegory and it gets a bit weird at times (mystical-ish) but so what. It’s a frickin’ movie not a revisionist documentary. I still hold it is a great work of fiction and a mostly libertarian one at that.

7. Kinsella (February 15 at 12:32am)
Tom has long been a gadfly type. He supports all manner of unlibertarian proposals, but wants to fly the libertarian radical flag, and of course people like him start to feel uncomfortable so they start attacking anyone wiht principles. They basically become useless nihilists.

8. TokyoTom (February 17 at 12:01pm)

Stephan, that last comment is a very impressive demonstration of confused, unprincipled, unconstructive blatheration. It’s the kind of reflexive, self-satisfied hostility I expect to see of statists, but am a bit embarrassed to see from self-ascribed ‘anarchists’/libertarians. Nice show.

9. Kinsella (February 17 at 12:03pm)

apparently the existence of principled libertarians drives the pragmatists and minarchists and middle-of-the-roaders nuts.

10. TokyoTom (February 17 at 12:04pm)

Andy, thanks for the comment. Dunno why you feel the need to bash Cameron as a “watermelon” “eco-nut”, when he has made it clear in other contexts that he is standing up for the rights of native peoples.

The struggle he addressed in Avatar is still very much underway; see this from recent news? “To get the gold, they will have to kill every one of us”

11. TokyoTom (February 17 at 12:08pm)

Stephan suggests that “There is nothing inherent in corporations that makes them more likely to violate rights. It’s just a form of business organization.”

I imagine Stephan can likewise not see the moral hazard trainwrecks that have also been set in motion by governments insuring deposits, protecting the shareholders of listed companies, owning and developing resources, or in regulating on the basis of pollutions or public health and safety, either.

12. Kinsella (February 17 at 12:12pm)

Governments violate rights when they insure deposits. You see, Tom, that is what libertarians are against–aggression, rights violations. People who privately organize their business arrangements in a certain way do not inherently or necessarily do this. See, so it’s irrelevant whether there is a “moral hazard” or not. Libertarians are not opposed to “moral hazards.” We are opposed to aggression.

13. Kinsella (February 17 at 12:16pm)

And the state does not “protect shareholders.” I have explained this in depth already. http://www.stephankinsella.com/…/kol100-the-role-of…/

and http://www.stephankinsella.com/…/kol115-mises-canada…/

14. TokyoTom (February 17 at 12:26pm)

Stephan suggests that I am a “gadfly” “unlibertarian” who “attack[s] anyone wiht principles” and who is a “useless nihilist” whom he has “principled libertarians” (AKA, himself) has “drive[n] nuts.”

I think that, unfortunately, what we have here is Stephan demonstrating the roots of property lie not in principles, but in the reflexive, bristling defense of what people (individuals and groups) regard as valuable enough to defend.

Calm down, Stephan.

15. TokyoTom (February 17 at 12:52pm)

Stephan is the kind of Bootlegger-Baptist critic who himself is a vociferous Baptist who is uncomfortable looking at how Govt sets up the Bootleggers who are gaming the system.

In free, voluntary markets, there is no Get-Out-of-Personal-Liability-for-Harms-Caused-to-Others-Free Card.

Limited liability for shareholders is a state-granted favor that is demonstrably at the bottom of the dynamic of people forever running to a gamed “democratic” government to make Govt make its creations behave more nicely (with the regulations then serving to protect the big, to limit competition, and to fuel corruption and further govt capture). As soon as governments began creating corporate monopolies and/or limited liability cos, then then judges followed suit by rejecting strict defense of property in favor of a pollution-/corporation-favoring “balance” of equities that Block noted.

16. Kinsella (February 17 at 2:28pm)

I explained in detail in the talks and blog post linked, why this is wrong. There is no reason to assume passive shareholders ought to be liable for torts committed by others. In a private law society, there is no reason to think shareholders would be liable in the first place.

17. TokyoTom

Stephan consistently attacks arguments I don’t make. It must be because he is more principled than I am:
http://tokyotom.freecapitalists.org/?s=limited+liability+kinsella

18. Kinsella (February 17 at 2:51pm)

Tom, you just stated your view that state limited liability for shareholders is some kind privilege. that implies it is giving someone a limitation on liability that they otherwise would have in a free market. It’s not a privilege unless it changes the situation.

19. TokyoTom (February 17 at 2:56pm)

Stephan: “In a private law society, there is no reason to think shareholders would be liable in the first place.”

In a private law society, one finds ALWAYS individuals and associations of individuals who may negotiate liability caps with voluntary counterparties, but remain potentially personally liable up to the remainder of their personal assets for harms that their activities (and those of their agents) caused to others.

While the persons who actually directly caused harms would of course be liable, their principals would try to limit their own potential exposure by either closely managing their agents or making sure that others were independent contractors.

Stephan defends a state-created order where it is now extremely difficult, if not impossible, for us (and tort victims) to determine WHO in fact acted and is responsible for vast harms, such as those produced by BP, WVa’s “Freedom Industries”, TVA, TEPCO and the like. Instead, Stephan grotesquely calls polluting companies “victims”.

20. Dan Cotter (February 17 at 3:17pm)

Does anybody else find it strange when people write their comments as if they are speaking to an audience rather than just directly speaking to the person they’re conversating with?

21. TokyoTom (February 17 at 3:44pm)

Dan, I’ve been talking with Stephan Kinsella for several years – putting me a ten-foot-pole distance has too often been one of his penchants, because his principles mean I stink. We’ve had a bit of a hiatus, so when I visited here, you can see that I addressed him directly; he shifted to the third person here: https://www.facebook.com/nskin…/posts/10151972701413181….

22. Kinsella (February 17 at 9:22pm)

haha, are you really criticizing me for using third person…? come on dude.

23. Kinsella (February 17 at 9:25pm)

“remain potentially personally liable up to the remainder of their personal assets for harms that their activities (and those of their agents) caused to others.”

This is almost right. You are liable for harms (some types anyway) caused by your *actions*. (“activities” is intentionally vague)

But shareholders do not act to cause the harm caused by employees of the company they have stock in.

“While the persons who actually directly caused harms would of course be liable, their principals would try to limit their own potential exposure by either closely managing their agents or making sure that others were independent contractors.”

Calling shareholders “principals” is question-begging. They are passive. I have explained this. So have other that I linked to–e.g. rothbard and pilon and hessen.

“Stephan defends a state-created order where it is now extremely difficult, if not impossible, for us (and tort victims) to determine WHO in fact acted and is responsible for vast harms, such as those produced by BP, WVa’s “Freedom Industries”, TVA, TEPCO and the like. Instead, Stephan grotesquely calls polluting companies “victims”.”

How is this supposed to be an argument that shareholders are causally responsible for torts of employees? Everyone seems to simply assume this respondeat superior type vicarious liability.

24. TokyoTom (Feb 19 at 4:52pm)

“‘activities’ is intentionally vague”

This is intentionally hair-splitting obfuscation; one “acts” – we call what people do both “activities” and “actions”.

– “shareholders do not act to cause the harm caused by employees of the company they have stock in.”

It is not my premise that they always/necessarily do — though of course, sometimes shareholders may be actively involved in torts tied to the business activities conducted by the corporation they own shares of. When judges “pierce the corporate veil”, they essentially treat shareholders as principals/partners/sole proprietors.

– “Calling shareholders “principals” is question-begging. They are passive. I have explained this.”

Suggesting I was calling shareholders principals is either stupidity or a deliberate misreading; I was clearly referring to private law orders/contractual arrangements outside of corporations, not state-made corporations: https://www.facebook.com/nskin…/posts/10151972701413181… (PS–I really don’t like this attack style, but perhaps tit-for-tat is the best approach with anarchists who prefer to set examples of disrespect.)

But yes, of course now, within the state-made corporate form — and especially within listed companies, shareholders MAY be (but are NOT necessarily) “passive”. But this is itself quite problematic, though not my chief point.

– “How is this supposed to be an argument that shareholders are causally responsible for torts of employees? Everyone seems to simply assume this respondeat superior type vicarious liability.”

You attack arguments that I do not make. This is your style is your wont, Stephan — I find it wanting. I have NEVER argued that “shareholders are/should be causally responsible for torts of employees” or just “assumed respondeat superior type vicarious liability”.

Partners and sole proprietors were/are not deemed automatically responsible for torts committed by their employees, yet the risk and expense of potential lawsuits has always served to have them pay attention to risks that their employees and agents might harm others. An artificial state-made liability cap freed shareholders from downside risks, and incentivized blind eyes to practices that were costly to others.

It is clear that respondeat superior doctrine was expanded judicially and by law as firms left the realm of private businesses and became favored creatures of the state.

I am glad you are paying some attention to questions of individual responsibility, though of course you have NOT done so consistently, when you persisted in calling “BP” a “victim” and ignoring the corporate problem of discerning who it is who acts:

“It is one of the salient features of corporations that they confuse themselves and everyone else as to WHO, precisely, is responsible for their actions and the harms they cause others, and it is time for Austrians to examine such features closely. – See more at: More about “the biggest victim”, BP, and how we can help it end its “victimization”

Poor statists! If we close our eyes tightly enough, we can see clearly that Corporations are innocent VICTIMS, of governments that foist on them meaningless grants like limited liability & IP, and of malevolent, grasping citizens

Thanks for playing, and for your decent Avatar post.

25. Kinsella (Feb 20 at 2:24 am)

“It is not my premise that they always/necessarily do — though of course, sometimes shareholders may be actively involved in torts tied to the business activities conducted by the corporation they own shares of. When judges “pierce the corporate veil”, they essentially treat shareholders as principals/partners/sole proprietors.”

I am at a loss to identify the coherent libertarian principle you are trying to invoke. Who cares about the modern positive state law of ‘piercing the corporate veil,’ for example–what possible relevance has this for justice?

“Suggesting I was calling shareholders principals is either stupidity or a deliberate misreading;”

oh, i assure you, I am merely stupid, not dishonest.

–Wait.

“I was clearly referring to private law orders/contractual arrangements outside of corporations, not state-made corporations: ”

Wasn’t clear to me, kemosabe, but then I don’t have your IQ or whatever.

“Partners and sole proprietors were/are not deemed automatically responsible for torts committed by their employees, yet the risk and expense of potential lawsuits has always served to have them pay attention to risks that their employees and agents might harm others. An artificial state-made liability cap freed shareholders from downside risks, and incentivized blind eyes to practices that were costly to others. ”

What does this frenetic screed of incoherent babble have to do with libertarian principles? Answer: not much.

“It is clear that respondeat superior doctrine was expanded judicially and by law as firms left the realm of private businesses and became favored creatures of the state. ”

So… you are in favor of respondeat superior. well Rothbard, Pilon, Hessen and I are not. Congratulations on your glomming onto the state schema.

26. TokyoTom (Feb 20 at 5:35 pm)

You disappoint by never failing to disappoint, Stephan.

1. “I am at a loss to identify the coherent libertarian principle you are trying to invoke. Who cares about the modern positive state law of ‘piercing the corporate veil,’ for example–what possible relevance has this for justice?”

You are at a loss to understand the libertarian principle that a man — even a shareholder — might be called to account for his own acts? I agreed that shareholders should not be liable qua shareholders, and simply indicated that they might be liable based on their own actions. Corporate “veil piercing” is justified if based on a fact-finding that a shareholder directed a tortious act.

2. “Wasn’t clear to me, kemosabe, but then I don’t have your IQ or whatever.”

Real gentlemen don’t find admissions of error so difficult, and sneering, gratuitous contempt and off-handed offensiveness so easy. Whatever.

3. Me: “Partners and sole proprietors were/are not deemed automatically responsible for torts committed by their employees, yet the risk and expense of potential lawsuits has always served to have them pay attention to risks that their employees and agents might harm others. An artificial state-made liability cap freed shareholders from downside risks, and incentivized blind eyes to practices that were costly to others. ”

You: “What does this frenetic screed of incoherent babble have to do with libertarian principles? Answer: not much.”

Kindly demonstrate that this is both babble, and babble not related to libertarian principles. Austrians are keenly attuned to moral hazard, and I was describing what I perceive as dynamics, not a principled position on liability rules (though LvMI has published pieces calling for a prohibition on corporations in the banking sector). But if I recall correctly, you too have indicated that you oppose the state structuring of/stamp of approval on corporations.

Your own frothing has nothing to do with libertarian principles, and in fact demeans them.

4. Me: “It is clear that respondeat superior doctrine was expanded judicially and by law as firms left the realm of private businesses and became favored creatures of the state. ”

You: “So… you are in favor of respondeat superior. well Rothbard, Pilon, Hessen and I are not. Congratulations on your glomming onto the state schema.”

Congrats on another false and unjustifiable conclusion. Par for your course. Austrians Mises, Hayek, Rothbard, Block, Cordato etc. all describe what they discern of the dynamics of human action within institutional structures; please congratulate them too for glomming onto the state schema.

Ad hom is a shameful game, Stephan. It discredits your good work that you that you thrill to it so much.

Categories: Uncategorized Tags:

The fundamental socialism of capitalism: Elinor Ostrom echoes Hayek in explaining that rules and institutions are a form of social capital

June 9th, 2011 No comments

I hope you’re not wondering just WHO Elinor Ostrom is, but I’ve blogged quite a bit about her.

For those of you who need a reminder, Peter Boettke said the following when this brilliant, hard-working political scientist deservedly won the Nobel Prize in Economics in 2009:

Lin Ostrom is firmly seated in the mainline tradition of economic scholarship from Adam Smith and David Hume to F. A. Hayek and James Buchanan ….. Instead,   she has been a major contributor to public choice economics, new institutional economics, and to our understanding of polycentricity and political economy.

And:

Her presidential address to the APSA summed up her theoretical agenda as “A Behavioral Approach to the Rational Choice Theory of Collective Action.”

She is most deserving of this Nobel, and she has made a unique contribution theoretically and empirically to the study of self-governance. But there is no need to pick a fight where one isn’t there. Her prize fits nicely in a stream of recognitions ANALYTICALLY by the committee to scholars such as Hayek (1974), Buchanan (1986), Coase (1991), North (1993), and V. Smith (2002). These are all scholars within the discipline of economics/political economy that recognize the cognitive limitations of man, and focus analytical effort on institutional analysis.

Lin Ostrom’s contributions come from an analytical framework that grounded in rational choice theory (as if the choosers are human) and builds to an institutional analysis (as if history mattered). The distinction between “rules in form” and “rules in use” means she studies in close detail the social norms that underlie self-governance in the management of resources and the management of social relationships.

It is amazing body of work.

Now for the pitch:

The Gund Institute for Ecological Economics has just posted on YouTube this thought-provoking 38-minute lecture that Ostrom gave in 2006:

 

The Challenge of Building Social Capital in a Sustainable & Desirable Future

 

[View:http://www.youtube.com/watch?v=Bo5Unn3AkVY&feature=youtube_gdata:550:0]

Hmm, you mean even the institutions of “private property” and corporations are forms of social capital, and dependent on shared institutions and even “trust”?

And that such “social capital” might include negative externalities?

Just what the heck IS “property“, then?

And corporations might have negative characteristics?

And indigenous “primitives” might have valuable, adaptive social capital?

And are large corporations as well as “government” responsible for the erosion of Hayek’s “market morals”?

So many questions, and so much distrust eating away at the social capital! …

Categories: Uncategorized Tags:

Scrupulosity IV: Corporations are the Health of the State (thanks to institutionalized moral hazard)

June 6th, 2011 2 comments

I copy below some more of my dialogue with Stephan Kinsella and others, regarding Jeffrey Tucker‘s unhappiness that not all libertarians are cheerleaders for our current model of “capitallism” (see my eariler posts on “scrupulosity“).

Stephan does a great job at wrestling with strawmen, attributing to me positions that I have expressly argued against, and questioning my forthrightness and my dislike for the state:

{Folks apologies if you are seeing disordered paragraphs; the blogging software seems to do that frequently when one copies in various blocks of text. I have added a few numbers to make chronological order clear.)

1.  Stephan Kinsella June 5, 2011 at 8:33 am

Calling shareholders “passive” might be a fair representation of the existing, government-created system – especially for listed, “public” companies, but that’s pretty much my point. This is NOT true of partnership or other traditional types of business organization,

See Hessen et al.–it is true of limited liability partnerships, where you have limited partners who are passive, and general partners who are active.

But even for a general partner–why is he automatically liable for what torts employees commit? this hoary, feudal notion of respondeat superior–you are responsible for your “servants’” actions–is a bit insulting and elitist.

” and the grant of limited liability itself deliberately signals shareholders that they can turn a blind eye to activities that profit the company while posing costs and risks to others.”

If they would not be liable in the first place then it’s not a grant, any more than you, as a Walmart customer, are “granted” limited liability just b/c the law does not currently make you jointly reponsible for torts committed by Walmart employees. I suppose you could argue this “grant” of limited liability to you as customer makes you as customer turn a blind eye to its risky activities. As I said in my post, this broad view of causal responsibiltiy would make everyone in society liable for everyone else all the time, without exception, which is why I analogized it to socialized medicine/Obamacare.

Sure, it’s probably not now “fair” to passive shareholders to “attribute vicarious liability to them … for torts committed by employees”, but that is both a strawman and besides the point. The point is that the government grant of limited liability MAKES A DIFFERENCE;

You keep saying it’s a grant but this is question begging, as this assertion assumes that absent this legal rule they would be liable vicariously under some libertarian principles of causation. I deny that they would. So if you say it’s grant you are arguing dishonestly by assuming your premise.

the strawman is that I am certainly NOT proposing a new rule that shareholders be assigned liability for acts by corporate employees, but simply that the limitation on liability be eliminated

WElt he state should be eliminated of course. There should be no laws whatsoever regarding corporations. I agree with this. The limitation of liability law should be abolished. I of course agree, which shoudl be apparent from reading what I have written since unlike many left-libertarians who are vague and maunder and equivocat and are disingenuous I try like Rothbard to be clear and upfront, and am very openly anti-state. I simply disagree with people like you who explicitly or implicitly propose that in a free society it would be appropriate to automatically hold the equivalent of passive shareholders (whatever you call them) vicariously responsible for others’ torts. If you think removing limited liability would make a difference, this is your implicit view. This is what I disagree with; your distractions seem to be an attempt to cloud the water to make it hard to see that this issue is at the heart of our disagreement.

– just as other grants by the government of liability limits (nuclear power, offshore oil drilling, and pollution permitting generally) should be eliminated.

Yes, I agree, but that is a bad analogy b/c those ARE real limits that do have an effect, unlike the shareholder case which does nothing IMO but ratify the situation that would obtain anyway.

Your assertion that limited liability of shareholders “would also be present in a free society in which private contractual ‘corporations’ arose” is totally unsupported. Can you point to where Rothbard, Hessen or Pilon argue that private contracts that limit liability of investors against voluntary creditors could serve to limit their personal liability against INVOLUNTARY creditors, viz., tort victims?

It’s not contracts that do it. It’s simply the fact that tort victims can pursue the tortfeasor, and the shareholder is not the tortfeasor; and there is no ground for making the shareholder liable vicariously for the employee’s torts.

And yes, see: Rothbard on Corporations and Limited Liability for Tort; Legitimizing the Corporation and Other Posts; Defending Corporations: Block and Huebert; Pilon on Corporations: A Discussion with Kevin Carson; Corporations and Limited Liability for Torts; In Defense of the Corporation

For example, see pilon http://www.stephankinsella.com/wp-content/uploads/texts/ga-l-rev-1979_6.pdf pp. 1310-. for Hessen, see this excerpt,http://www.lewrockwell.com/blog/wp-content/uploads/2004/04/Hessen+corporation+tort+liability+excerpts.pdf , pp. 18-20
and http://www.stephankinsella.com/2010/02/rothbard-on-corporations-and-limited-liability-for-tort/ — this last post also quotes Rothbard: “Similarly, if a corporate manager committed a wrong and damaged the person or property of others, there is no reason but “deep pockets” to make the stockholders pay, provided that the latter were innocent and did not order the manager to engage in these tortious actions.”

So, Rothbard, Hessen, Pilon–all hold that passive shareholders are not automatically liable vicariously for torts committed by employees, any more than limited partners would be.

Just as you, surely, have no objection to private agreements between parties to protect the information created by one of them (private “intellectual property”)

I would not call it that. “Intellectual property” is a propaganda term invented recently to justify state grants of monopoly privilege (patent and copyright)http://blog.mises.org/14914/intellectual-properganda/

but simply oppose state-created IP, so too should you (as a lawyer!) be able to understand that in principle, of course, I have no objection to contract-based companies, but oppose the obvious and important favors granted by the state in the case of all corporations?

You are confusing the case for contractual limited liability of shareholders for contractual debts, with the case for shareholders not being liable vicariously for others’ torts. The latter is not based on contract.

2. Not to be missed is that the grant of limited liability is extremely important and consequential:

See: The Cliff Notes version of my stilted enviro-fascist view of corporations and government – TT’s Lost in Tokyo http://bit.ly/9oBkC7

It has allowed owners to divorce themselves from formal reponsibility for the acts of their agents/employees, to divorce themselves from the communities in which their firms act, and to dodge claims of moral responsibility.

So what? this is not a justification for a law. It’s just some “policy” musings.

So we are left with massive corporations which are massively entangled with government

That’s b/c there is a state (which you favor, not me; I’m the anarchist), not b/c of the way people would create firms on the free market

and are powerful buyers of favors, which citizens forever clamor for “more control!”, and which lack any clear locus of responsibility — and in which we find anarchist libertarians like yourself and Lew Rockwell acting as their lawyers, and calling them and their shareholders “the biggest victims” (not the little people on the short end of the stick of projects like Gulf oil drilling, nuclear reactor meltdowns or even mundane health/air/water/soil damage from pollution)

Emotivism. You are not making an argument. It is not unlibertarian to have a view as to who is victimized by a given state policy. In fact the central state whose legitimacy you yourself support claims the overlord/landlord status in the offshore continental shelf; BP held a lease. It was your central state that is the landlord whose tenant had the oil spill. By your principles of vicarious responsibilty where you want to willy nilly say some old lady holding a single share of BP stock should be personally liable for this tort, of course the landlord should be too, right? I.e., your state is responsible, so why are you blaming me for favoring private investors in a free society, when you support the very state’s existence, the state that is responsible for the BP spill in the first place? And of course the nuclear industry is heavily distorted and corrupted by the state; Chernobyl was teh state’s fault, and the entire meltdown-prone western nuclear industry was corrupted by your beloved state for military reasons — instead of safe Thorium we needed the current system to produce nuclear weaponshttp://www.libertarianstandard.com/2011/04/01/the-states-corruption-of-nuclear-power/

So blaming this on private investors is rich. It’s the state’s fault, as usual. You think that getting rid of one of the few state laws that happens to mimic the likely result on a free market (limited liability for passive shareholders) is what you should focus on?!

As Mises long ago noted, moral hazard matters.

This is how statists and law professors reason. It is not how libertarians reason. We believe in individual rights–property rights–and have principles. we don’t run around “weighing” various “policy reasons” to tweak and fine tune statist positive law.

3. While in principle any partnership can keep going even when one partner dies or decides to leave and new partners are added, surely you are aware that this is a very cumbersome process, not in small part because of the concerns that the partners and its lenders, suppliers and customers all have about who, precisely, is managing the business and who has liability for potential losses?

Nonsense. SEe the Hessen excerpt above, p. 17, regarding how partnerships or firms can easily make the firm effectively immortal by use of continuity agreements. This is not hard.

Just as for limited liability,

More question begging, as I have explained

the grants of legal entity status,

this is not a gift but an unnecessary status that the state uses to justify regulation and double taxation of shareholders. In a free market firms would not have legal personality nor do they need to. Hessen has already explained this almost 30 years ago.

unlimited life,

See Hessen, last mention above. This can be done contractualy.

unlimited purposes and the ability to own subsidiaries are all substantial AND consequence-laden gifts from the state.

The purpose is whatever the shareholders agree to. It has nothing to do with the state just as marriage should not. Ownign a subsidiary is not a privilege but just another contractual private scheme. Nothing you described is a gift fromt he state. All these features are doable privately and contractualy, except for entity theory which is not a gift but a penalty.

Show me a partnership that has any of these, without a grant from the state.

This is like asking me to show you a 100% reserve bank. They are not used now b/c the state’s fractional reserve/guaranteed system outcompetes it. If I want a perpetual firm I just use a corporation b/c the state provides this mechanism. In a free market people would have to do it privately contractually, on their own; I have no idea if they would be called limited partnerships, LLP, LLC, or what. Who cares? IT’s just a detail. Get the state out of the way, and we’ll see.

Waht i object to is your clamoring for shareholders to be liable, when you have no theory whatsoever undergirding this.

The state creation of corporations has do much to muddle who, exactly, is responsible for injuries to third parties caused by “the corporation”.

So what, really? In most cases the corporation pays the victim, and has assets to do so.

Getting rid of limited liability would do much to provide moral clarity,

Again, this is question begging, b/c you are assuming there would and should be liability for shareholders absent the limitation of liability law.

I would note that, just as if deposit insurance were eliminated, market actors would step up to advise on which banks are safe and to provide deposit insurance, so too would insurers step up if limited liability were ended.

We are NOT talking about bringing down capitalism.

I know, but this still does not justify your claim that shareholders should be liable vicariously for the torts of others. What is your theory of causal responsibility? I have tried to sketch one out — http://mises.org/journals/qjae/pdf/qjae7_4_7.pdf — and see no way to hold passive shareholders liable; confirming the reasoning on the same lines of Hessen, Pilon, and Rothbard.

TokyoTom June 5, 2011 at 10:00 am

Stephan, of course the state is also at fault when statist corporations do stupid s**t like in the case of BP and TEPCO, and I’ve been arguing the case against the state as landlord loudly here for years now.

” claim that shareholders should be liable vicariously for the torts of others.”

You keep asserting this, even though I’ve made careful efforts to make it clear that I make no such claim. Do you anarcho-capitalists have such a difficult time reading? (By the way, since the boxes you want to put people in matter so much to you, I’m not by my own consideration “left” anything.)

I simply want to end the state creation of corporations, in particular the grant of limited liability to shareholders. You think it doesn’t matter and fight tooth and nail to defend corporations that lack any clear personal moral locus, while I think it has mattered and still quite profoundly, not the least in providing the rationale for the regulatory state.

Just as deposit insurance is at the root of rampant moral hazard in our financial sector, so too is limited liability at the root of corporate statism.

Sorry, but it’s late and I have a full day tomorrow. But I’ll ask, what INDIVIDUALS would you hold responsible for the BP oil spill and TEPCO bad decisions?

nate-m June 5, 2011 at 10:49 am

I simply want to end the state creation of corporations, in particular the grant of limited liability to shareholders. You think it doesn’t matter and fight tooth and nail to defend corporations that lack any clear personal moral locus, while I think it has mattered and still quite profoundly, not the least in providing the rationale for the regulatory state.

” claim that shareholders should be liable vicariously for the torts of others.”You keep asserting this, even though I’ve made careful efforts to make it clear that I make no such claim.

?
So you do not think that share holders should be liable for actions of employees, but you think that the legal framework that prevents share holders being liable for the actions of the employees should be removed?

It seems that these two statements are diametrically opposed under the current system. If you do not think that share holders should be liable then the way you achieve this is via LLC.

The only alternative is to go full AnCap with a contract-based legal framework, but that’s not going to happen any time soon.

If you remove LLC protections then your making shareholders liable vicariously for the torts of others.

 

2. TokyoTom June 5, 2011 at 6:47 pm

I suspect that Stephan’s lack of my response to my most recent comment to himhttp://blog.mises.org/17179/scrupulosity-and-the-condemnation-of-every-existing-business/comment-page-1/#comment-785116
indicates that he finally understands the difference between (1) a government rule absolving shareholders from personal liability for acts of the corporate legal fiction or its agents and (2) the absence of such a clear limitation of risk, which would leave shareholders subject to the risk of claims and a possible finding of liability.

There is quite a difference, and it can be seen in the choice of corporate founders to use the limited liability form, as opposed to alternatives that leave shareholders/investors on the hook, such as partnerships, corporations where shareholders expressly have no liability limitations (Amex was one such when it was created) or where shares are not fully paid in (and the corporation has a capital call), and in the continuing pressure by owners of partnerships to get governments to create entity forms that absolve owners of liability for damages to involuntary creditors.

nate-m, does this help understand my point? http://blog.mises.org/17179/scrupulosity-and-the-condemnation-of-every-existing-business/comment-page-1/#comment-785121

I am not saying we should have a rule that automatically makes shareholders liable for acts by the corporation and its agents, but that we should end the government rule that frees them from risk – and the incentives to oversee and monitor that risk.

The consequence of limited liability has been the steady growth of the regulatory state, and of use of the regulatory state by corporations (via CEOs who have slipped shareholder control) to create barriers to entry.

Just like we can end financial regulation by ending deposit insurance and forcing depositors to monitor banks, so too can we end the regulatory state by making shareholders pay attention to the risks created by corporations.

http://mises.org/Community/blogs/tokyotom/archive/2011/05/12/immodest-thoughts-to-fix-capitalism-we-must-get-govt-out-of-corporate-risk-management-rent-selling-business-and-get-shareholders-to-stop-playing-39-victim-39-amp-start-paying-attention-to-risks.aspx

REPLY

Stephan Kinsella June 5, 2011 at 7:35 pm

Your comments are incoherent, Tom. waht in the world are you trying to say.

REPLY

TokyoTom June 5, 2011 at 9:14 pm

I’ll make it simple, so even a non-lefty, non-stupid and non-dishonest anarcho-cap lawyer can understand:

The state grant of limited liability to shareholders, besides simply being unjustifiable under libertarian principles, has, by reducing the need of shareholders to monitor risk, had a profound affect on the development of what we now call ‘capitalism’ and on the growth of the regulatory state in response to complaints about corporate excesses.

I restated this position last September in the comment thread to a post by Geoffrey Plauche:

“Your uncertainty here is a manifestation of the confused discussion over liability for “corporate torts”that Stephan Kinsella refers to. His position is that only humans act, and not corporations (though they are given “legal entity” status), so only particular persons who actually injured someone else (and those who directed/ordered their actions) should be liable for any tort – not the corporation itself (and certainly not shareholders, unless they were personally involved somehow). I agree that granting corporate status has greatly confused discussions over whom should be liable for corporate torts, and think Stephan too lightly brushes back the enormous and anonymous torts that our now massive corporations commit — precisely what individuals, for example, is responsible for the BP disaster, for the damage to health and property caused by pollution, or for injuries resulting from faulty products?

“Rolling back limited liability should not mean that shareholders SHOULD be held liable for corporate torts in the same way that executives, managers and employees (the first two benefiting from company-purchased insurance policies) and sometimes lenders are; it would just mean that they would get no government-provided “get out of jail free” card. In this way, common shareholders would be put on a similar footing to partners in a partnership that acts through paid managers.”

The facts that the state now makes the corporate form widely available and that we have huge, statist corporations do not make the status quo acceptable, just as the state’s generosity in making IP widely available and that many are now invested in the status quo doesn’t justify IP or validate all the damage it’s causing.

But despite your ancap identity, you (and Lew Rockwell) keep rushing out to defend our system of amoral and anonymous pools of capital, rather than real people:

http://mises.org/Community/blogs/tokyotom/search.aspx?q=kinsella+victim

Thankfully, others are seeing this re limited liability:

Finally an LvMI commentator who sees the elephant in the room: effective reform to rein in rampant moral hazard at banks means removing limited liability! – TT’s Lost in Tokyo http://bit.ly/atelEr

The Curse of Limited Liability; WSJ.com: Executives/traders of big financial corporations generate risky business, while smaller partnerships are much more risk averse – TT’s Lost in Tokyohttp://bit.ly/8nlWr7

Best,

Tom

REPLY

3. TokyoTom June 5, 2011 at 7:14 pm

Block points to corporate moral hazard as a dynamic behind the rise of the regulatory state:

Limited liability produces both pollution and political meddling: Block on Environmentalism – TT’s Lost in Tokyo http://bit.ly/mvV4Qn

Ludwig von Mises on laws that cap risks: http://mises.org/Community/blogs/tokyotom/archive/2007/10/11/draft.aspx

“The laws concerning liability and indemnification for damages caused were and still are in some respects deficient. By and large the principle is accepted that everybody is liable to damages which his actions have inflicted upon other people. But there were loopholes left which the legislators were slow to fill. In some cases this tardiness was intentional because the imperfections agreed with the plans of the authorities. When in the past in many countries the owners of factories and railroads were not held liable for the damages which the conduct of their enterprises inflicted on the property and health of neighbors, patrons, employees, and other people through smoke, soot, noise, water pollution, and accidents caused by defective or inappropriate equipment, the idea was that one should not undermine the progress of industrialization and the development of transportation facilities. The same doctrines which prompted and still are prompting many governments to encourage investment in factories and railroads through subsidies, tax exemption, tariffs, and cheap credit were at work in the emergence of a legal state of affairs in which the liability of such enterprises was either formally or practically abated.”

“Whether the proprietor’s relief from responsibility for some of the disadvantages resulting from his conduct of affairs is the outcome of a deliberate policy on the part of governments and legislators or whether it is an unintentional effect of the traditional working of laws, it is at any rate a datum which the actors must take into account. They are faced with the problem of external costs. Then some people choose certain modes of want-satisfaction merely on account of the fact that a part of the costs incurred are debited not to them but to other people. …

“It is true that where a considerable part of the costs incurred are external costs from the point of view of the acting individuals or firms, the economic calculation established by them is manifestly defective and their results deceptive. But this is not the outcome of alleged deficiencies inherent in the system of private ownership of the means of production. It is on the contrary a consequence of loopholes left in this system. It could be removed by a reform of the laws concerning liability for damages inflicted and by rescinding the institutional barriers preventing the full operation of private ownership.”

REPLY

Stephan Kinsella June 5, 2011 at 7:36 pm

What is your question, exactly?

REPLY

TokyoTom June 5, 2011 at 9:18 pm

Not a question, but a response to your claim that my concern about “moral hazard” and CONSEQUENCES and somehow taints me and is non-libertarian:

“This is how statists and law professors reason. It is not how libertarians reason. We believe in individual rights–property rights–and have principles. we don’t run around “weighing” various “policy reasons” to tweak and fine tune statist positive law.

Balderdash: we all care about consequences, which is the chief reason why people are paying the slightest attention to your ‘principled’ ragings about IP.

 

Categories: Uncategorized Tags:

Scrupulosity III: More fun at pretending that nothing about the nature of state-created corporations leads to statism

June 6th, 2011 No comments

 I copy below a few more of my comments on Jeffrey Tucker‘s unhappiness that not all libertarians are cheerleaders for our current model of “capitallism” (see my eariler posts on “scrupulosity“):

TokyoTom June 3, 2011 at 8:35 pm

Thanks for the great Rothbard quote, Rodney.

Unfortunately, it looks like Rothbard never focussed on the special state grants to those forming corporations that institutionalize Moral Hazard and make them such powerful agents of both corrupting/buying favors from government and at destroying commons. The grant of limited liability got the ball rolling, and things have snowballed mightily, as citizens clamor for ever more government control of our government-created amoral agents.

Regards,

Tom

PS: In addition to my comment above, http://blog.mises.org/17179/scrupulosity-and-the-condemnation-of-every-existing-business/comment-page-1/#comment-784780,
there’s more here:

http://mises.org/Community/blogs/tokyotom/search.aspx?q=cliff+notes
http://mises.org/Community/blogs/tokyotom/search.aspx?q=Limited+liability

TokyoTom June 5, 2011 at 6:44 am

Anthony, many corporations are very obviously in bed with government and driving the decisions of politicians and bureaucrats. Are we to pretend that this isn’t happening, or that those in corporations trying to buy government favor have no moral responsibility for their actions?

Are we also to just hope government goes away, instead of fighting for greater freedom and less government favors to corporations?

I disagree: Immodest thoughts: To fix capitalism, we must get govt out of corporate risk-management (rent-selling) business and get shareholders to stop playing ‘victim’ & start paying attention to risks – TT’s Lost in Tokyo http://bit.ly/kNAWFT

TT

REPLY

sweatervest June 5, 2011 at 1:23 pm

“driving the decisions of politicians and bureaucrats”

The only thing that drives the decision of a politician or bureaucrat is that politician or bureaucrat. They are the ones that are holding the guns, not the corporations. If the corporations ask a favor of the state they must offer something in return, because the operators of the state must voluntarily agree to it (no one case force them). Corporations are by no stretch of the imagination in charge of the state.

REPLY

TokyoTom June 5, 2011 at 6:25 pm

Incentives, good and bad, drive decisions of all people.

We get poor decisions from politicians and bureaucrats because of moral hazard, the information problem, budgetary incentives, lack of accountability, the information problem and, not least, the pressure and enticements of corporations.

“Corporations are by no stretch of the imagination in charge of the state.”

I think I said: “many corporations are very obviously in bed with government and driving the decisions of politicians and bureaucrats.” Are you denying corporate influence?

TT

Categories: Uncategorized Tags:

Immodest thoughts: To fix capitalism, we must get govt out of corporate risk-management (rent-selling) business and get shareholders to stop playing ‘victim’ & start paying attention to risks

May 11th, 2011 2 comments

I am prompted by recent events to follow up on thoughts I emailed to Sheldon Richman a few months back:

I feel strongly that If we want to fix the country (and if libertarians don’t want to be dismissed as irrelevant/patsies for rent-seekers) we need to find ways to restore shareholder ownership of downside risk. This is the only way to back away from the destruction of communities and our natural and government commons by faceless elites through corporations – and the battle for control over Government micromanagement that so often is captured by corporations and serves as barriers to entry.

Insurers would step in to help shareholders and act as a check on management.

The states that create corporations retain power under the 14th Amendment to discriminate in favor of local, unlimited liability forms of corporation or corporations in which shares are not fully-paid up. There is nothing like a substantial risk tail to focus shareholders on managing management.

 

In addition, allow me to summarize thoughts that I have posted extensively elsewhereThe state has institutionalized moral hazard and exacerbated principal-agent problems via the grant of limited liability to corporate shareholders. This grant is at the core of why investors chose to us the corporate form (as opposed to traditional partnerships and older versions of corporations where shareholders retained substantial risk), and is something that cannot be obtained merely by voluntary transactions – as it involves future potential involuntary victims of acts by the new corporate legal entity (lenders and other parties can of course agree in advance to liability caps and recourse limits). 

This state intervention has set in motion and greatly fuelled the growth of government and battles with citizen groups over the wheel of government — battles in which insider elites, generally acting through long-lived and deep pocketed corporations that are armed with greater knowledge and cloaked with anonymity, have the overwhelming advantage. I earlier summarized these dynamics here: The Cliff Notes version of my stilted enviro-fascist view of corporations and government

 

As I have noted elsewhere: I am NOT arguing FOR a general rule that shareholders SHOULD be liable for corporate torts. Rather, I

(1) point out that limited liability itself has served to muddle the question of whom, exactly, should be responsible for the very real harms that corporations frequently cause (if, as some argue, the corporations and their shareholders themselves are the “victims” of the troubles they create, then whom, exactly, are the perpetrators?),

(2) note that the limited-liability corporate form has enabled risk-generation and -shifting on a massive scale, with innocent third parties frequently being stuck holding the bag (not solely when liabilities exceed assets, but more generally since the cycle of escalating government interventions to rein in corporations perversely ends up raising barriers to entry and giving corporations regulatory “rights to pollute” that curtail liability even when sufficient assets are available),

(3) argue that libertarians should reconsider the grant of limited liability for torts (as opposed to limited liability as to those who contract with the corporation on a voluntary basis) not simply because it is clearly non-libertarian to begin with, but because it has had profoundly perverse consequences (consequences at a serious enough level that state-loving libertarians in effect concede simply by troubling themselves to argue against curtailing limited liability),

(4) note that the most efficacious way to roll back the regulatory state lie in the direction of shifting ultimate responsibility for managing risks to enterprise owners (and ending the counter-productive regulatory risk-management experiment), and

(5) note that a curtailment of limited liability for torts could be hedged by shareholders via insurance, and could be achieved by state governments and the federal government offering more lenient regulation to busness enterprises that operate as partnerships, unlimited liability corporations, or in cases where shares are not fully paid up so that calls for significant additional capital could be made against shareholders if needed to pay claims.

All of this should be quite evident in the wake of the BP disaster in the Gulf of Mexico, as well as in the nuclear crony-capitalism behind the decision-making that has now come back to bite Japanese individuals and firms that use TEPCO power or which are downwind of their tsunami-damaged nuclear plants (though both of these cases are compounded by even deeper governmental interventions). It should also be evident in the many cases at home and abroad where corporations act to exploit (and pay royalties to governments on) mineral and energy resources that governments purport to “own”, and where governments grant corporations “public utility” monopoly rights.

Any suggestion that one must “provide a theory of liability that coherently distinguishes shareholders from any other patron of the company” BEFORE one can examine any justifications FOR the state grant of limited liability or the consequences of such intervention would be both sadly non-libertarian and dangerously blind and shallow.

Can I interest any other libertarians in pursuing this avenue of rolling back the state?

Categories: Uncategorized Tags:

Nick Sorrentino suggests that Left and Right can come together on "free market reforms"

May 7th, 2011 No comments

Nick Sorrentino is the Austrian-leaning editor of The Liberty and Economics Review blog and CEO of Exelorix.com, a social media management company.

Being a sucker for building discourse and pursuing collaboration, I took a fancy to a recent post of Nick’s where he suggested just such things. Nick gracefully agreed to let me cross-post it in its entirety below.

I note that my own leanings on free-market reforms are toward ways to address corporate statism and over-regulation; e.g., Limited Liability, AvatarBP+Gulf, the “environment“, and  David Korten’s “10 Common Sense Principles for a #NewEconomy” http://bit.ly/fW4Pu8.

Without further ado, here’s Nick: 

 A chance for the right and left to come together on free market reforms. (April 30, 2011)

 

By Nick Sorrentino

What is a free market? It is the free exchange of goods or services without intervention from coercive elements. In a free market price signals can be found. Too much of something? The price goes down. To little? The price goes up. It’s a simple equation yet history has shown us that it is very difficult for humans to simply let the market work.

I won’t get into whether the market always works. I basically believe that it does, but some good arguments can be made against my position in some very limited situations. Generally speaking however I think that most people would agree that a non manipulated market is a market that serves the most people and does the most “good.”

What is interesting to me is that many folks on both the right and left agree on this principle. Sure there are those on the fringe who will argue that markets are somehow “immoral.” But most Americans I believe just want a level playing field. The left doesn’t want cozy deals for corporations and the rich, and the right doesn’t want cozy deals for corporations and the rich. Whoa, hey, here’s an area of real agreement.

Many on the left don’t believe that the GOP would ever seek to end sweetheart deals for corporations. Many see the Republican Party as a vehicle by which companies game the system for their benefit. Many on the left do not believe in their heart of hearts that rank and file Republicans would ever be against special deals for “big oil” or “big agribusiness” or “big pharma” or especially “big finance.”

Likewise many on the right don’t believe that the left would ever give business a fair shake. But the distaste that many on the left have for business is not simply a hatred of all things business. What I sense is that many of my liberal friends mostly object to the “unfair” aggregation of power by businesses. They see an ever expanding Military Industrial Complex, bailouts to banks which result in big bonuses for a relative few, lax regulations for oil companies, and so on.

I’m here to tell you that there are many on the right who are ready to look very closely at the special deals many businesses have been able to garner for themselves. In a time of extreme economic challenge lots of folks who may have looked the other way before now recognize that such deals are unaffordable and frankly indefensible from a free market perspective.

I am also here to tell you that there are quite a few thought leaders on the left are open to the idea of freer markets so long as the special deals for many entrenched business interests are eliminated.

There is an emerging consensus on both the right and left that we must put our economic house in order. Eliminating sweetheart deals for businesses and unions could be an area where right and left can come together and actually get something done that would help the country at large.

At this moment I think it is on the left to reach back out to the right. Right now the GOP has extended a hand.

On Monday Speaker Boehner was interviewed by ABC News and he stated publicly that oil subsidies for instance are on the table.

Also this week at a town hall meeting House Budget Committee Chairman Paul Ryan said;

“We’re talking about reforming the safety net, the welfare system; we also want to get rid of corporate welfare. And corporate welfare goes to agribusiness companies, energy companies, financial services companies, so we propose to repeal all that,”

In addition to these two very important statements this week, last month a letter released by the National Taxpayers Union and signed by 30 conservative groups including Heritage Action for America (part of the Heritage Foundation), Taxpayers for Common Sense, FreedomWorks, Americans for Tax Reform, Americans for Prosperity, Club for Growth, and the Competitive Enterprise Institute called for the elimination of all energy subsidies and loan guarantees for the energy sector. This is a huge development. Subsidies are not free market, now it seems the freemarketeers are ready to come out and say it.

So, left, the ball is in your court. What are you bringing to the table?

This article was also published on The Republican Leadship Network site.

Categories: Uncategorized Tags:

Are ‘enviros’ evil,or trying to protect property + reassert control over behemoths? New Zealand Navy + Petrobras vs. Maori fishermen

April 27th, 2011 No comments

A quick show of hands:

  • How many of you think that the recent protests by New Zealand “greens” and Maori fishermen against Government-licensed oil exploration activities by PetroBras is evidence of a blind envirofascist hatred of mankind?
  • How many of you cheer on the “capitalist” exploration and development of government-owned resources by big and state-entanged corporations, over the quaint claims to “fishing rights” by locals?
  • How many of you think that PetroBras and its shareholders are the real victims of these protests?
  • How many think it’s a sign of how government “ownership” of public resources leads to zero-sum politicization of decisions, and of decisions that are tilted toward activities that provide revenues to government, while shifting risks to local communities and individuals?
  • Does anybody see any parallels with BP and the Gulf?  With the crony capitalism supporting Tokyo Electric, the operator of the Fukushima nuclear plants?

I posted a few tweets on this topic, which I copy below in chronological order:

 TokyoTom

NZ Navy intervention in oil protest “disgusting” – Maori MPs |     
 TokyoTom 

Maori Sovereignty? “Maori feel the pollution risk to the water+fish stocks is too great”   
 TokyoTom 

Maori skipper detained by Navy warship for defending ancestral fishing waters from Oil Drilling  
 TokyoTom 

Maori fisherman: “We are defending tribal waters+our rights from reckless Govt policies”   
 TokyoTom 

“opening up natl parks+our coastline to transnationl corps shows contempt+will face fierce+sustained local resistance”
 TokyoTom 

Petrobras protest+Maritime Rules  |clear frm+ tht Gov ‘ownership’ leads to poor risk mgt+theft frm communities
 TokyoTom 

“Gov has awakened some sort of taniwha.We’re all virgins at doing this.We never fight”   
 TokyoTom 

“April 11: NZ Navy ships+Air Force planes begin monitoring the protest along with police”   
 TokyoTom 

“after the licence was given-in what way is that consultation? It isn’t, not even close”    
 TokyoTom 

Te Karere Ipurangi » Blog Archive » Oil surveys damage sea creatures organs – ECO    
 TokyoTom 

MP says it is a disgrace…wrong for NZ citizen to be threatened by Defense for opposing a deal btwn gov+foreign oil co
 TokyoTom 

NZ Gov happy w discretion to act unilaterally 2increase Gov revenues+to ignore locals  
 TokyoTom 

In NZ as in ,locals trying to exercise community crtl treated as ‘terrorists’    
 TokyoTom 

Rikirangi Gage to  “We are defending tribal waters+our rights frm reckless Gov policies”  
 TokyoTom 

AUDIO:Rikirangi Gage of te Whānau-ā-Apanui vessel radios captain of  oil survey ship  

Avatar

Categories: Uncategorized Tags:

Are Hayek’s essential "market morals" breaking down? Hmm … Is peace breaking out, or are things getting ugly?

March 30th, 2011 No comments

[Apologies for the weird font sizes – guess I’m too old to figure out the html stuff that creeps in when I cut and paste!]

I wanted to post a few additional and somewhat scattered thoughts I have had relating to the 1986 essay of Hayek that I recently stumbled across, “The Moral Imperative of the Market”.

What morals do we end up with as “market morals” are eroded?  In larger communities, the morals of a cynical or self-deluded selfishness and self-justification, accompanied by growing tribalism, insularity, suspicion, hostility, avarice, prejudice, jingoism and intolerance.

As the market breaks down, so also do market dynamics of broad exchange and sophisticated institutions, and things become each man for himself, finding friend and families to hunker down with, a hardening towards and less concern for others – who indeed may be viewed as either a threat or as fair game.

IOW, it’s the same load of aggressive, selfish and narrowly tribal stuff that once was ESSENTIAL to bands of humans when when we lived in a state of Nature and life was brutish and short, and that I’ve been giving other members of this and other communities grief over ever since I was marooned on these fertile but once hostile shores:

Cooperation comes naturally to man – among those we feel we can trust – but within limits, as so too does suspicion come naturally as to “others” who look like they might pose a threat. In building extended markets, we are always struggling with our predilection to form “Bands of Brothers”. In doing this work, we are always making use of our sophisticated yet at times quite reflexive native endowment.

As I noted a couple years back (you know, in ancient times when Al Gore won the Nobel Peace Prize) in a comment to libertarian science correspondent Ron Bailey at Reason Online:

you forget what evolutionary psychology, Ostrom and Yandle have explained to us so well about how our innate moral sense drives and underpins mankind’s success as a species by enhancing our ability to cooperate and to overcome commons issues.
Ostrom: http://conservationcommons.org/media/document/docu-wyycyz.pdf
Yandle: http://www.fee.org/publications/the-freeman/article.asp?aid=4064

Our long history of developed rules and institutions (informal and formal now overlapping) are based on our moral sense and the effectiveness of these rules depends critically on our moral investment in accepting their legitimacy – witness our views on murder, theft, lying and “not playing by the rules” – and in voluntarily complying with them.

Our moral sense reinforces our judgments about when rules/institutions are not working and the need to develop new ones in response to changing circumstances and new problems.  When we see a problem that we think requires change, it is unavoidable that we respond to the status quo, the behavior of people within it and the need for change with a moral sense. 

This is simply a part of our evolutionary endowment.  (Of course, other parts of our endowment accentuate our suspicions of smooth talkers and help us catch free riders and looters and to guard against threats from outsiders.)

Let all of us here at LvMI (and any strangers!) please be aware of our predilections, while we continue with the hard work of building strong, vibrant and open free societies.

I know, comrades, that you’re all dying for links to some of my relevant posts, which I certainly won’t begrudge to you :

Snicker-snack! We hold these truths to be self-evident: That WE’re right, and THEY are stoopid, deluded, evil AND cunning, out to destroy all that is good and holy

Bill Gates, Roger Pielke, Avatar & the Climate (of distrust); or, Can we move from a tribal questioning of motives to win-win policies?

I Can’t Stand Cant, Or, LeBron James and our Collectivist Scorn of “Collectivists”

Nick Kristof on politics: why we conclude that I’m right, and you’re evil (with a handy-dandy listing of a number of earlier fun posts!)

And a clip of a comment I made to Stephan Kinsella a little while back:

Austrians seem to act as if the love of reason requires a surrender of it in favor of the comforting distraction of a self-satisfied echo chamber of a type that would warm the cockles of any like-minded religious “alarmist” cult.

Mind Games: Bret Stephens of The Wall Street Journal panders to “skeptics” by abjuring science and declaring himself an expert on “mass neurosis”

Categories: Uncategorized Tags:

That annoying off-beat drummer: In response to the 'heretic' Dr. Curry, more on my pig-headed libertarian open-mindness on climate issues

March 24th, 2011 No comments

I alerted readers in January to a blog post on libertarianism and the environment by Dr. Judith Curry, who heads the School of Earth and Atmospheric Sciences at the Georgia Institute of Technology, and is known for her work on hurricanes, Arctic ice dynamics and other climate-related topics.

Scientific American  noted last October, in “Climate Heretic: Judith Curry Turns on Her Colleagues; Why can’t we have a civil conversation about climate?“, that:

over the past year or so she has become better known for something that annoys, even infuriates, many of her scientific colleagues. Curry has been engaging actively with the climate change skeptic community, largely by participating on outsider blogs such as Climate Audit, the Air Vent and the Black­board. Along the way, she has come to question how climatologists react to those who question the science, no matter how well established it is. Although many of the skeptics recycle critiques that have long since been disproved, others, she believes, bring up valid points—and by lumping the good with the bad, climate researchers not only miss out on a chance to improve their science, they come across to the public as haughty. “Yes, there’s a lot of crankology out there,” Curry says. “But not all of it is. If only 1 percent of it or 10 percent of what the skeptics say is right, that is time well spent because we have just been too encumbered by groupthink.”

While I recommend that interested readers review the whole thread, I copy below my comments and some related:

Judith, a climate scientist friend kindly gave me gave me a head’s up to your post.

I have been blogging and commenting for quite some time on environmental and climate issues from a libertarian perspective, and have also spent considerable time on trying both to help libertarians engage productively on environmental issues and to help leftist-environmentalists understand where libertarians are coming from.

Sadly, it’s largely a messy tale, reflecting how fights over government policy tend toward zero-sum games that blunt cooperation, the success that fossil fuel and other corporate interests have had in gaming the system, and how our tribal human nature leads many to abandon critical thinking in favor of choosing and reflexively defending sides and positions.

I have been highly critical of many libertarians in perpetuating unproductive discord, and have been the resident environmentalist pain-in-the-neck at the Ludwig von Mises Institute (for libertarian economics), which kindly hosts my blog. In particular, even while try to build bridges I have been critical of the Cato Institute, Competitive Enterprise Institute, Heartland Institute and MasterResource, which I view as being skewed by donations toward corporate agendas. There are of course some highly productive libertarians working on environmental and conservation matters; Terry Anderson and others at PERC (Properrty and Environment Research Center) have led the way on fisheries, water and other issues. (And then there are quasi-libertarians like Elinor Ostrom.)

Since you’ve expressed interest, allow me to load you up with a few links, to my exchanges with others such as John Quiggin, to my cajoling and castigating of libertarians, and to some of my views on climate/environment issues :

“Towards a productive libertarian approach on climate, energy and environmental issues ” http://bit.ly/ab3xJB

“John Quiggin plays Pin-the-tail-on-the-Donkey with “Libertarians and delusionism” ” http://bit.ly/8Zv5Y6

“A few more comments to John Quiggin on climate, libertarian principles and the enclosure of the commons ” http://bit.ly/eXaTKI

“A few more “delusional” thoughts to John Quiggin on partisan perceptions & libertarian opposition to collective action”http://bit.ly/f0FQ6K

“To John Quiggin: Reassuring climate “delusions” help us all to avoid engaging with “enemies” in exploring common ground ”http://bit.ly/eIFr4e

“The Cliff Notes version of my stilted enviro-fascist view of corporations and government ” http://bit.ly/9oBkC7

The Road Not Taken II: Austrians strive for a self-comforting irrelevancy on climate change, the greatest commons problem / rent-seeking game of our age http://bit.ly/14n6G0

For climate fever, take two open-air atom bombs & call me in the morning; “serious” libertarian suggestions from Kinsella & Reisman!?http://bit.ly/f2bRUr

Thanks, Dr. Reisman; or, How I Learned to Hate Enviros and Love Tantrums http://bit.ly/h4BI0B

“Escape from Reason: are Austrians conservatives, or neocons, on the environment? ” http://bit.ly/cJhov2

“The Road Not Taken V: Libertarian hatred of misanthropic “watermelons” and the productive love of aloof ad-homs”http://bit.ly/cqFlzh

OMG – those ecofascists hate statist corps, too, and even want to – GASP – end that oh-so-libertarian state grant of limited liability!http://bit.ly/gjJFnv

“Who are the misanthropes – “Malthusians” or those who hate them? Rob Bradley and others resist good faith engagement despite obvious institutional failures/absence of property rights ”http://bit.ly/hbONhd

http://mises.org/Community/blogs/tokyotom/search.aspx?q=ostrom

http://mises.org/Community/blogs/tokyotom/search.aspx?q=bradley
http://mises.org/Community/blogs/tokyotom/search.aspx?q=manzi
http://mises.org/Community/blogs/tokyotom/search.aspx?q=michaels
http://mises.org/Community/blogs/tokyotom/search.aspx?q=lewis
http://mises.org/Community/blogs/tokyotom/search.aspx?q=horner
http://mises.org/Community/blogs/tokyotom/search.aspx?q=penn
http://mises.org/Community/blogs/tokyotom/search.aspx?q=bailey

On non-climate issues:

“Too Many or Too Few People? Does the market provide an answer? ” http://bit.ly/8zlecI
http://mises.org/Community/blogs/tokyotom/search.aspx?q=BP+oil
http://mises.org/Community/blogs/tokyotom/search.aspx?q=Avatar

Sincerely,

Tom

  • Tokyo Tom, thanks much for your input. your post originally went to moderation owing to the large number of links.

    • Dr. Curry, thanks for your indulgence on this; given the time differences (bedtime now!) and my schedule tomorrow, I thought throwing out a few links might be useful (though I may be mistaken!!).

      Tom

    • If I can add one further thought before I head off to bed, it would be that a key prerequisite (as Ostrom points out) for tackling commons issues like climate change that involves many players and countries is the need for TRUST, an element that is sadly lacking (a resource that libertarian analysis indicates is destroyed by squabbles over government) .

      Bill Gates, Roger Pielke, Avatar & the Climate (of distrust); or, Can we move from a tribal questioning of motives to win-win policies? http://bit.ly/912Xkj

      On climate, myopic progressives console themselves by pointing out fossil $ behind science “skeptics”; but miss the same from left and ignore middle ground http://bit.ly/arSX5G

      ‘Night.

      Tom

One wee error in your intro:
“Sadly, it’s largely a messy tale, reflecting how fights over government policy tend toward zeronegative-sum games that blunt cooperation”
There. All fixed! ;)

Tom is someone who has managed to separate the difference between science and policy.

  • I am honored that you visit me, as you must be very busy in the Year of the Wabbit.

    Thanks, Eli, but it means that Tom is someone for whom the thrills of tribal comabt do not offset the woes of being the odd man out, if not “the enemy”.

    Tom

Michael, Climate Etc. has technical threads and discussion threads. This is a discussion thread. I usually monitor things quite closely on technical threads, which are pretty much troll free. There have been excellent discussions with very knowledgeable skeptics on many of the technical threads. If you look at the denizens list, there are many people spending time here with serious credentials and wide ranging and varying professional experiences. This is not a place where mindless people bother hanging out.

What am I hoping to accomplish on discussion threads? I raise thorny topics on the discussion threads, at the interface between science and society. People challenge their own prejudices by arguing with people having different opinions. Invariably I learn something when people suggest interesting things to read (on this thread, i have found some of Tokyo Tom’s links to be interesting.)

Assuming i have time in the next day or do (which is not a good assumption, I’m afraid), i will do a Part II on this thread, picking out some points/ideas to focus on in a follow on thread. Once we get the heat out of the way, we often generate some light over here.

bob, I would be interested in a part II to this subject, and it would be great if Tokyo Tom or Rich wanted to do this, provided the topic was about how to deal with global environmental issues and potential tragedy of the commons issues.

  • Not sure how you could reconcile the distance between these two. Yes, they are both Libertarians. But one sees the climate issue like so:

    Yeah, I deny the anthropogenic carbon dioxide global temperature forcing “hypothesis” (not that it deserves even the courtesy use of that term). It started out as an extraordinary – hell, preposterous – effort to account for a completely screwed interpretation of insufficient surface temperature data (gained initially, it appears, from Stevenson screen thermometers “sited next to a lamp” by way of all sorts of instrumental screw-ups related to urban heat island effect and similar artifact) thirty years ago, and has proceeded through those three decades not only without the development of convincing evidence supporting this brain-dead blunder but suffused with a continuing agglomeration of data-doctoring, book-cooking, code-jiggering, suppressio veri, suggestio falsi, peer-review-perverting, dissident-censoring, cork-screwing, back-stabbing, dirty-dealing, and bald-faced lying.

    and the other sees it a bit differently: [my emphasis added]

    On environmental issues in general and climate in particular, find me someone ranting about “Malthusians” or “environazis” or somesuch, and I’ll show you someone who doesn’t understand – or refuses to acknowledge – the difference between wealth-creating markets based on private property and/or voluntary interactions/contracts protected by law, and the tragedy of the commons situations that result when there are NO property rights (atmosphere, oceans) or when the pressures of developed markets swamp indigenous hunter-gather community rules.

    So what’s the deal? Here’s a perfect opportunity for skeptics to educate the supposedly market ignorant, but they refuse, preferring to focus instead on why concerned scientists must be wrong, how concerns by a broad swath of society about climate have become a matter of an irrational, deluded “religious” faith, or that those raising their concerns are “misanthropes” or worse.

    Some on the left likewise see libertarians and small-government conservatives as deluded.

    Both sides, it seems, prefer to fight – and to see themselves as right and the “others” as evil – rather than to reason

    While we should not regret that we cannot really constrain human nature very well, at least libertarian and others who profess to love markets ought to be paying attention to the inadequate institutional framework that is not only poisoning the political atmosphere, but posing risks to important globally and regionally shared open-access commons like the atmosphere and oceans (which are probably are in much more immediate and grave threat than the climate). And they also ought to recognize that there are important economic interests that profit from the current flawed institutional framework and have quite deliberately encouraged the current culture war.

    So, once again, ideological affiliations aside, there are people who look for ways to solve possible problems and people who look for reasons to ignore possible problems.

Categories: Uncategorized Tags:

More dialogue on "Rethinking IP": does property arise because it helps people in societies to solve problems, or because thinkers come up with "principles"?

February 24th, 2011 No comments

Further to my previous post (Rethinking “Rethinking IP”, or, if we step away from statism, will societies not find ways to protect ideas?), allow me to note here some conversations from the comment thread to Stephan Kinsella‘s Rethinking IP post.

My key point is that it is cooperating individuals in societies with shared values, mores and customs who come up with “property rights” in the form of agreed practices that they find mutually suitable, not thinkers who are coming up with “principles”, and using them to tell others how stupid they are.

Societes of cooperating individuals are the sine qua non of ALL property. Those who focus on the “principles” but ignore the need to build community are trying to grow trees at the risk of damaging the  forest.

I’ ve corrected a few typos and added emphasis:

 

Stephan Kinsella February 16, 2011 at 12:51 pm

I don’t ignore the fact that ideas are valuable. This is incorrect. On your blog you say

Stephan Kinsella has another post up at the Mises Daily on “Rethinking IP”; while I share Stephan’s mission of ending state-sponsored IP – which has morphed into gross corporate-statist corruption, oppression and profound waste – as usual Stephan’s aggressive approach has generated as much heat as light in the comments section.

Rather than reaching a shared understanding of how damaging IP has become (there are real frightening aspects to the current situation) and putting heads together as to whether private alternatives are acceptable or likely or already exist, we have proponents and opponents of IP largely arguing past each other; one seems to assume that if there IS a “principled” basis for IP, then a state role must be accepted, while the other seems to assume that if there is NO “principled” basis for IP, then all IP is theft, so that those who produce useful or appreciated ideas, technologies, music, art and literature will go unrewarded.

How sad that even libertarians forget the role of private efforts and of communities in protecting valued resources and productivity!

I disagree that I “forget” this. And I disagree that we have to be consequentialists without principle. If we have a reason to oppose IP on principle, there is nothing wrong wtih communicating and explaning this.

Reply

TokyoTom February 16, 2011 at 10:46 pm

Stephan, you’ve acknowledged ideas are valuable, so then why you do this weird thing of assuming away the question of whether a free society would protect ideas – and ignoring the growing array of non-statist alternatives (since even state-created and -enforced IP is leaky)?

Widely agreed libertarian principles of no state coercion does not translate into a principle that free individuals, organizations and societies can’t evolve ways to afford protection for ideas – nor is such an effort needed to fight the IP/corporate-statism that concerns us all.

 

Peter Surda February 16, 2011 at 9:46 am

Tokyo Tom,

Stephan, in your eagerness to find a strong “principled” basis to reject IP, you ignore the fact that, like physical substances/resources that we find valuable and worth protecting (which protection our society acknowledges as appropriate via the term “property”), many ideas are valuable, take time to develop and may be worth defending.

In general, I can actually agree with this. If someone said that in his opinion, IP is more valuable than physical property, and therefore takes precedence, that would destroy my most important objection!

However, doing this requires admitting that you are a utilitarian. I guess a typical IP proponent has a big problem with this, so he prefers not to do it.

Reply

TokyoTom February 16, 2011 at 10:31 pm

Peter, isn’t it clear that is the IDEAS men have about how to use resources that makes them valuable?

While we must have food, water and shelter to survive, in an advanced economy all ‘property’ is a manifestation of an idea and the intellectual component is the primary value. The sand that goes into fiber optics and computer chips is dirt cheap.

Ideas are clearly as important as physical property — the question is simply whether those who want to protect either are justified in using the state to do so.

Afraid I don’t follow you on utilitarianism ….

TT

Reply

Peter Surda February 17, 2011 at 2:33 am

Tokyo Tom,

my argument is that immaterial goods are an interpretation of the material goods, rather than a separate phenomenon. If I was wrong, it would be possible to show an immaterial good which does not contain a material good, or how to interact with an immaterial good without using the material world, or how to act without changing the physical world.

I don’t object to the claim that ideas have values. However, if we assigned property rights to them, we would need to sacrifice a proportional amount of physical property right. If you, in general, accept the concept of physical property rights (which all of IP proponents I debated so far do), then your only defence of IP can be that the rights you are gaining are more important than those that you are losing (= utilitarianism).

Reply

TokyoTom February 17, 2011 at 9:31 am

Peter, I’m afraid we may have different understandings of what ‘property’ is; my rather pragmatic concept is here:

http://mises.org/Community/blogs/tokyotom/archive/2009/12/20/what-is-quot-property-quot-a-few-weird-thoughts-on-evolution-society-quot-property-rights-quot-and-quot-intellectual-property-quot-and-the-principles-we-structure-to-justify-them.aspx

Seems to me that humans and the societies they live in have rather flexible views of what is ‘property’, and it is easy to understand the choices in a [personal] utilitarian light; that is, resources that are given protection are those that are relatively more important and relatively more easily protected [by the people involved]. What can be easily defended personally (and by relatives or employees) may be ‘personal’ property, while other property that requires cooperation may be community property or property in which individuals have limited personal rights and corresponding responsibilities, but in all cases people carry a shared sense of what is ‘right’ and ‘wrong’ — that is, a shared sense of what is ‘property’, whom it belongs to and what that means in terms of rights and obligations.

Intellectual property and physical property are not very different in these regards in our own society, and both would be likely to arise and exist in one form or another even without a state. In cases of both physical property and IP, what is considered property will be based on the relative values placed on those who control such resources and those who wish to be able to make use of them – that is, on the purely utilitarian considerations of the people involved. If those generating ideas wish to control their use by others and others find such ideas valuable, then they will come to mutually agreeable terms of use – such as a contract as to whether a book may be duplicated or shared, or the terms under which manufacturing know-how will be made available. No express social ‘utilitarian’ agreements are needed, though general/widely-accepted norms may of course arise.

Is this something that makes sense to you?

FWIW, my own view is that largely it is the material goods that are an interpretation of the immaterial ones (viz., people’s values and ideas) rather than the other way around.

TT

Reply

Peter Surda February 17, 2011 at 10:05 am

Tokyo Tom,

I am afraid that you still do not address my objection. The objection is indifferent to the exact definition of property. It merely points out that no matter what your assumptions are, if they are contradictory with respect to each other, your position is wrong. Even if you change the assumptions, as long as they continue to contradict each other, you remain in error.

I’m sorry but I don’t have the time to read your whole article, so I’ll just make a summary based on what I think it says. Please correct me with I’m wrong. You are saying that as society evolves, people create rules of conduct and some of them are mandated by the use of force. Because there is a demand for “IP”, it is possible that people will include “IP” in these rules.

I have no problem with this construct. But it goes too far ahead of the argument. First of all, it does not address the problem that no matter how the rules are constructed, as long as they are self-contradictory, they cannot be based on correct reasoning. It also does not address my second objection (which I mentioned elsewhere) in that it does not actually explain what IP is.

TokyoTom February 18, 2011 at 1:22 am

Peter, thanks for your further observations. I think you still misunderstand my position about how ‘property’ arises. Property has its roots in competition over resources, and in the choices we faces as to what resources we devote our limited energies in securing and defending. In human societies, this is a process reflecting both competition and cooperation. This piece by Bruce Yandle is useful in illustrating how property arises:

http://www.thefreemanonline.org/featured/the-commons-tragedy-or-triumph/

Now, to address your specific points:

no matter what your assumptions are, if they are contradictory with respect to each other, your position is wrong.

Okay, but what ‘assumptions’ of mine are you referring to?

You are saying that as society evolves, people create rules of conduct and some of them are mandated by the use of force. Because there is a demand for “IP”, it is possible that people will include “IP” in these rules.

A nuance: the underpinnings of property are not deliberately created rules at all, but evolved and shared viscerally felt understandings, as well as culture. It is on this foundation that some members of society may consciously build rules that the rest of scoiety may adopt – in which case, our senses of right and wrong kick in.

no matter how the rules are constructed, as long as they are self-contradictory, they cannot be based on correct reasoning.

My position is that most ‘property’ is not consciously constructed at all. There are some deliberate choices involving one or more persons, in which case they rely on the respective preferences of the people involved, not MY assumptions. But yes, some (many!) deliberately made rules can be based on incorrect reasoning – in which case the rules ultimately fail.

It … does not actually explain what IP is.

In my view, IP encompasses various ways that societies protect ideas – from simple personal private protection of them to agreed protection among company employees, to agreed protection by contracting users, to devices/techniques that restrict copying, to feelings and community morals that copying is wrong without permission, to various types of sanctions, such as being expelled from a particular community and other moral sanction.

‘IP’ does NOT require a state.

Does this help?

TT

TokyoTom February 16, 2011 at 11:05 pm

Wildberry, I believe that ‘the real boogie man is the State, not the principles of IP’, and that Stephan’s arguments about the illegitimacy of IP are needlessly turning friends who also share a desire for freer societies into enemies.

I am confident that even if we had no states but free societies, we would have a wide variety of IP, all grounded both on a shared sense of what is right and wrong, and on the value of the information and cost of protection.

And yes, we ought to be able to discussa this civilly AND find many points of mutual agreement. We should all be allies in a community with a shared objective of creating more freedom from state-backed kleptocracy.

TT

TokyoTom February 18, 2011 at 2:23 am

Wildberry, allow me a few thoughts on your comments above: http://blog.mises.org/15633/rethinking-ip/comment-page-1/#comment-759516

Mises called property a “human device”, and I have been repeating that here in support of the notion that humans agree what property is in order to facilitate the goal of cooperation, which is the very definition of society. The ways we choose, if rational, are designed to achieve goals which we seek to achieve. By “we”, I am referring to humans bound together in a society.

Except that Austrians would point out that ‘we’ don’t choose as a whole, individuals make their own choices, typically based on building blocks constructed by others but also including subconscious and cultural ones.

a “good” economic theory leads us effectively to the outcomes we desire.Therefore the operation of property rights and the economic policies employed to achieve desirable social goals should align.

I think that in the Austrian view, a ‘good’ economic theory is simply one that accurately reflects actual huiman behavior, and notes how states often frustrate problem-solving while enabling the creaming of common resources and other one-sided practices by elites.

 

The Austrian/libertarian view is that governments shouldn’t be consciously striving to employ any ‘economic policies’ to achieve any ‘desirable social goals”, as these are the objective of differening individuals all with differing preferences, and that the state mainly just gets in the way, enabling kleptocracy and incompetence and creating rigidities.

Identifying those areas where the operation of laws and government conflict with the preferred system of economic policies is one way (a very good way) to navigate among the myriad of legal and political issues that most who post here agree are not producing the outcomes we desire.

An Austrian/libertarian would agree only in the limited sense that ‘the preferred system of economic policies’ is to get government out of the way. People of more limited ambition like me would say that we should focus first on rolling back the most destructive and outrageous (reflecting a shared social sense that too much ‘theft’ and disruption is ‘too much’!) government interventions. Such an effort requires building a community of people who have shared purposes – even if the shared purposes may not share precisely the same ‘principles’.

Change, reform, revolution, whatever form of change one advocates, is best aimed at those specific conflicts. This ongoing debate about IP is simply a vehicle that is useful in the analysis of these conflicts.

Austrians oppose coercive state interventions that favor some while stifling others. While some want to do away with the state entirely, I believe it is more productive to focus on the most significant state interventions.

I would certainly agree with Stephan that IP is one the state’s significant and now increaasingly counterproductive interventions. In this sense, State-created IP is far more than simply ‘simply a vehicle that is useful in the analysis of these conflicts.’

I criticize SK and many of his followers about not granting a fair reading of IP laws in stating their opposition. As a result of this practice, much confusion results about what IP is, why it is tied to the same ethical principles, and in the same way, as any other legitimate agreement between cooperating humans. This in turn results in a non-productive debate, and little progress towards the obvious goal of coming together here on what and how to target desired change.

Let me disagree slightly: while we DO have an unproductive debate, Stephan and others are very right to point to ways that current state IP is extremely abusive and wasteful, and that the problem is growing. Yes, some may exaggerate.

But the REAL problem is that Stephan wrongly seems to feel that he has to attack ALL IP in order to round up opposition to STATE IP. But the two are entirely different; Austrians should not insist that, without state IP, there will be no free-market mechanisms and institutions that will arise to protect ideas. or that any such mecahisms, voluntarily agreed, would be ‘unprincipled’. Far from arguing with people’s rather visceral senses of what is right and wrong, Austrians should be directing such impulses to protect ideas into voluntary and non-statist avenues.

This makes us pretty ineffective agents for change. This is one explanation for why the libertarian political movement is so ineffective, in my view.

Sadly, I think you have a point. That is why I trouble Stephan by commenting here — I expect and hope for more from this particular community of libertarians.

Not sure how long you’ve been commenting here, but you’re certainly welcome, from my point of view.

TT

Wildberry February 18, 2011 at 1:00 pm

@TokyoTom February 18, 2011 at 2:32 am

Thank you for your thoughtful response. I have just a few comments:

“Austrians oppose coercive state interventions that favor some while stifling others. While some want to do away with the state entirely, I believe it is more productive to focus on the most significant state interventions.”

I think that ancaps and minarchists could cooperate in this regard. It seems a choice between doing nothing (i.e. even opposition to voting) because the whole government structure is going to collapse anyway, or doing something now. If we decided to do something, it seems rational to pick on the most egregious State interventions first. If we were really intelligent about it, we would identify those issues which have a low threshold to change while making a truly significant difference, or a high threshold for change that are game-changers, like real banking reform for example. If it got down to a point where we had accomplished minarchism and ancaps wanted to keep going, we could part company then. Before that point, it seems unnessary to be adversaries.

“I would certainly agree with Stephan that IP is one the state’s significant and now increasingly counterproductive interventions. In this sense, State-created IP is far more than simply ‘simply a vehicle that is useful in the analysis of these conflicts.’”

You are reading a little too much in my comment. I am saying the discussions here at mises.org are a vehicle for understanding principles upon which we may oppose harmful state interventions. Mercantile/State collusion is harmful and should be eliminated.

“Let me disagree slightly: while we DO have an unproductive debate, Stephan and others are very right to point to ways that current state IP is extremely abusive and wasteful, and that the problem is growing. Yes, some may exaggerate.”

Yes, it is always appropriate to give examples that support one’s position. However, if your examples support a position that is based on an inaccurate or unfair reading of the law, then it creates confusion among those who take SK at his word, given his expertise as an IP lawyer. It seems to me that if the examples are representative of some abuse, then that argument is not diminished by being honest about what the existing law actually is and how it operates.

As an example, it is common here to base an anti-IP argument on the premise that “ideas are free”, while as SK knows, both copyright and patent laws explicitly exclude ideas from protection. To even imply otherwise fosters confusion and undermines real understanding of the problem.

“Far from arguing with people’s rather visceral senses of what is right and wrong, Austrians should be directing such impulses to protect ideas into voluntary and non-statist avenues.”

Exactly. I really like your view about how principles of property rights arise as a result of the human need to cooperate with one another. That is why people HAVE a visceral objection to the assertion that there are no IP rights. It grates against a common-sense understanding of right and wrong. This point is articulated beautifully in a paper (and book) by Kathleen Touchstone. Are you familiar with her?

“Sadly, I think you have a point. That is why I trouble Stephan by commenting here — I expect and hope for more from this particular community of libertarians.”

Likewise, although I have noticed lately that more voices are coming to the fore in support of IP, perhaps because the are seeing that there is no reason to be intimidated by rude behavior.

“Not sure how long you’ve been commenting here, but you’re certainly welcome, from my point of view.”

About a year or so. It’s a pleasure corresponding with you. Thank you.

TokyoTom February 20, 2011 at 9:48 am

“IP is antithetical to capitalism and the free market.”

Stephan, isn’t this more than a bit of an overstatement? Is IP impossible in a free-market? Is it antithetical to capitalism to invest in protecting ideas?

“Typical of IP advocates. They are either stupid or dishonest.”

I am tempted to say something flip by mirroring you, but I’ll bite my tongue, and simply say that this is utterly unhelpful, and that I hope you fell at least a little chagrin that you damage our community and your cause in this way.

Yours in striking at the root,

Tom

Categories: Uncategorized Tags: