Review: Social Justice and the Christian Church (Nash)

This book isn’t quite the violent beat-down of the Sojourners guys that David Chilton’s was, but it’s close. It was a pointed response back then; it is a desperate cry today. As church groups are falling, or about to fall, to Social Justice, Nash’s words are worth hearing.

Ask a social Justice Warrior what Justice is. Do it. It’s quite funny. Nash begins with Aristotle. Not that Aristotle is great, but his discussions are as good as any.

The ancient (and most simple) definition of justice is “giving each one what she is due” (Nash 29). The problem is obvious: there is no way you can take this correct definition and deduce an entire economics program from it.

Universal justice: a person is just in the universal sense if he possesses all of the virtues. The Bible echoes this in Gen. 6:9 and Ezek. 18:5.

Particular justice: a man is just in this sense if he does not grasp for more than what he is due. Nash, following Aristotle, sees three subsets of this justice:

(1) commercial justice: just weights and balances.

(2) remedial justice: some wrong must be made right.

(3) distributive justice: a good or burden is apportioned among human beings (Nash 31).

Formal Principle of Justice: We can summarize Aristotle: equals should be treated equally and unequals unequally. Unfortunately, there is no criterion to help us.

Material Principle of Justice: this is usually seen in needs, deserts, achievement, etc.

Two Contemporary Theories of Justice

Rawls: (a) each person has a right to the most extensive basic liberty compatible with others’ basic liberties; (b) justice as fairness

To make his project work Rawls says everyone must assume a “veil of ignorance.” In other words, you have to imagine a society where any rights you give yourself wouldn’t conflict with others’ rights. The problem with this, as Nash notes, is we have no reason to think that anyone would come up with this veil of ignorance. The veil of ignorance idea isn’t bad, per se; we just have no reason for believing it. Anyway, there is no reason to think it is just (42ff).

As other critics have pointed out, any invention in society (like the automobile) has the potential to make 95% of society more affluent, yet it would marginalize a few. Therefore, cars are unjust. But no one will seriously live this way. The automobile would impoverish the horse-and-buggy industry. Should we get rid of automobiles?

The liberal confuses economic merit with moral merit

Justice and the Welfare State

Problem with interventionism: “The liberal’s obsession with the proper distribution of society’s goods blinds him to a crucial truth: that before society can have enough gooods to distribute among the needy, a sufficient quantity of goods must be produced. By focusing all their attention on who gets what, defenders of the welfare state promote policies that severely restrict production” (64).

Justice and the Bible

We can’t confuse Love and Justice. The state is an agent of justice, and states by definition are coercive.

Problems with enacting the Year of Jubilee today:

a) Not all poor would be helped. If you didn’t own land prior, then you aren’t getting any today.

b) Only Israelite slaves are freed. Tough luck to anyone else.

c) Only property outside the city would be affected. Sold property within the walled city would become permanent exchange after a year.

d) Immigrants did not have permanent land rights, so they wouldn’t be helped.

e) Those who were born after the Jubilee but died before it wouldn’t be helped.

Quotes of Liberty

“Social justice, as viewed by statist proponents…is possible only in a society controlled from the top down” (50).

In terms of content and prophetic witness, the book is magnificent. However, much of it is a summary of Rothbard and there really isn’t new content.

The South Might have Wanted Out of Slavery

Not the whole South, certainly, but the most important state, Virginia.

Click to access historyofslaver00blak.pdf

“In the year 1772, a disposition favorable to the oppressed Africans became very generally manifest in some of the American Provinces. The house of burgesses of Virginia even presented a petition to the king, beseeching his majesty to remove all those restraints on his governors of that colony, which inhibited their assent to such laws as might check that inhuman and impolitic commerce, the slave-trade: and it is remarkable that the refusal of the British government to permit the colonists to exclude slaves from among them bylaw, was enumerated afterwards among the public reasons for separating from the mother country” (Blake 177).

England said no.

A Primer on Hoffman’s *Usury in Christendom*

In addition to my longer review of Hoffman’s Usury in Christendom, I have this primer as well.

The Argument Against Usury

(1) God is the supreme owner of land and leases it to men (Hoffman 30).

(2) The idea of just price is often ridiculed, but misunderstood. It does not exist within a vacuum. A just price cannot work in a society that uses interest (43).

(3) The Old Testament intended usury to be used as a weapon against the nokri, the Canaanite in the land. It was not to be used against the ger, the sojourner.

(4) Money is fungible, so it cannot reproduce artificially.

(5) God’s provision for man in nature is a presupposition against usury. “To make a claim to wealth that outstrips that provision…is to produce injustice” (105).

(6) When money becomes abstracted (from use), its usefulness becomes obscure.

(7) Profit can only come from nature’s goods, which requires discipline and patience.

(8) The Logic of Mutuum: in a mutuum loan, ownership actually passes from creditor to debtor, so to “receive a fee for this, I profit from what is yours, not mine. Therefore, the creditor sells nothing that is his, but only time, which is God’s” (99, emphasis added).

(9) In a modern day usurious system, “the worker is separated from the material means of production to be brought again into contact only by means of the credit system in which everything is capitalized” (333).

What do we make of the above points? Some hold, but others do not.
(1′) This is true. And for what it’s worth, Wyclif made the same argument.
(2′) This is harder to square. Much of “just price doctrine” assumes that an entity has a monetary price within it, yet this is all but abandoned in modern economic theory. is worth x because someone subjectively values it at that price.
(3′) This seems fairly true.
(4′) On one level this is a good rebuttal to the (literal) sorcery that is fractional-reserve banking. But there is something about this claim that I just can’t put my finger on.
(5′) Aquinas’s argument seems to be that the usurer is claiming a stake in future (and not yet-existing) wealth without having the disciple and patience that keeping it requires.
(6′) I’m not sure.
(7′) seems to turn on (5′).
(8′) If (1′) obtains then it appears that (8′) obtains
(9′) This sounds awfully close to Marxism. In any case, I reserve judgment.

Mises on the Industrial Revolution

From Human Action.  This is Mises’s analysis. pp. 614-615.

Such are the ideas permeating most of the historical studies dealing with the evolution of modern industrialism. The authors begin by sketching an idyllic image of conditions as they prevailed on the eve of the “Industrial Revolution.” At that time, they tell us, things were, by and large, satisfactory. The peasants were happy. So also were the industrial workers under the domestic system. They worked in their own cottages and enjoyed a certain economic independence since they owned a garden plot and their tools. But then “the Industrial Revolution fell like a war or a plague” on these people.14 The factory system reduced the free worker to virtual slavery; it lowered his standard of living to the level of bare subsistence; in cramming women and children into the mills it destroyed
family life and sapped the very foundations of society, morality, and public health. A small minority of ruthless exploiters had cleverly succeeded in imposing their yoke upon the immense majority.

The truth is that economic conditions were highly unsatisfactory on the eve of the Industrial Revolution. The traditional social system was not elastic enough to provide for the needs of a rapidly increasing population. Neither farming nor the guilds had any use for the additional hands. Business was imbued with the inherited spirit of privilege and exclusive monopoly; its institutional foundations were licenses and the grant of a patent of monopoly; its philosophy was restriction and the prohibition of competition both domestic and foreign. The number of people for whom there was no room left in the rigid system of paternalism and government tutelage of business grew rapidly. They werc virtually outcasts. The apathetic majority of these wretched people lived from the crumbs that fell from the tables of the established castes. In the harvest season they earned a trifle by occasional help on farms; for the rest they depended upon private
charity and communal poor relief. Thousands of the most vigorous youths of these strata were pressed into the service of the Royal Army and Navy; many of them were killed or maimed in action; many more perished ingloriously from the hardships of the barbarous discipline, from tropical diseases, or from syphilis.15 Other thousands, the boldest and most ruthless of their class, infested the country as vagabonds, beggars, tramps, robbers,
and prostitutes. The authorities did not know of any means to cope with these individuals other than the poorhouse and the workhouse. The support the government gave to the popular resentment against the introduction of new inventions and labor-saving devices made things quite hopeless.

….

That the factories couId thrive in spite of all these hindrances was due to two reasons. First there were the teachings of the new social philosophy expounded by the economists. They demolished the prestige of Mercantilism, paternalism, and restrictionism. They exploded the superstitious belief that labor-saving devices and processes cause unemployment and reduce all people to poverty and decay. The laissez-faire economists were the pioneers of the unprecedented technological achievements of the last two hundred years.

Then there was another factor that weakened the opposition to innovations. The factories freed the authorities and the ruling landed aristocracy from an embarrassing problem that had grown too large for them. They provided sustenance for the masses of paupers. They emptied the poor houses, the workhouses, and the prisons. They converted starving beggars into self-supporting breadwinners. The factory owners did not have the power to compel anybody to take a factory job. They could only hire people who were ready to work for the wages offered to them. Low as these wage rates were, they were nonetheless much more than these paupers could earn in any other field open to them. It is a distortion of facts to say that the factories carried off the housewives from the nurseries and the kitchens and the children from their play. These women had nothing to cook with and to feed their children. These children were destitute and starving. Their only refuge was the factory. It saved them, in the strict sense of the term, from death by starvation.

It is deplorable that such conditions existed. But if one wants to blame those responsible, one must not blame the factory owners who-driven by selfishness, of course, and not by “altruismn-did all they could to eradicate the evils. What had caused these evils was the economic order of the precapitalistic era, the order of the “good old days.”

Review: Hoppe, A Short History of Man

This is a “For Dummies” version of his groundbreaking *Democracy: The God that Failed.* While it has some serious limitations, it’s last chapter, on Aristocracy and Democracy, is brilliant. And even in the earlier sections of the book there are neat insights.

The author is committed to a Darwinian scheme of evolution, so I question his methodology at points. Still, he does a good job explaining how if one is going to escape from the Malthusian system one must have an economic and technological breakthrough to produce enough food.

The last chapter, the one on democracy, while summarizing his conclusions in his magnum opus, also takes the argument one step forward. It’s not simply that the untermenschen that democracy creates are the ones that negate civilization. They certainly do that. Even more so, it isn’t simply the “Government” that attacks liberty. That’s true, also. Rather, and this is Hoppe’s key insight, it is a subgroup within the government that is actively opposed to liberty. He calls this group the Plutocrats. We know them as the Deep State.

You can find this book online for free. I would save your money and get his larger book on Democracy instead.

Review: Mises, Human Action

Von Mises, Ludwig.  Human Action.  Scholar’s Edition.

All deductive systems are dangerous if formulated incorrectly. Their appeal lies in their power, and Mises’s system is powerful indeed. Mises advances Praxeology, an economidoctrine emerging from the Classical School when it was realized that human action and not the inherent value of an object is what drove economics (Mises 3). Since our knowledge is limited, our choices will always have an element of uncertainty.

Thus, Mises can advance his main theorem: Human action is purposeful action. And the second is like unto it, “All action aims at a removing or lessening a present uneasiness.” Action does not measure utility or value; it chooses between alternatives. When I choose between unit a and unit b, I am not choosing between the total stock of either, but simply between the marginal values of both a and b. And this leads to the key gain of the Austrian school: the doctrine of marginal utility. The marginal utility of a good decreases as its supply increases. Whenever I get a good, I devote it to the most important end. As I get more goods, I devote them to lesser ends. Obviously, this applies to subjective-use value and not a thing’s perceived objective value. This allows the Austrian School to avoid the hang-ups which plagued all of the Classical Economists from Smith to Ricardo to even Marx.

Not directly, but indirectly related to the above is another axiom: Because man is an acting man, situations change. Prices will change. There cannot be a universal “set price.” Past prices are a guide to future prices.

Another axiom

Mises has several challenging chapters on interest and the Industrial Revolution. He argues that interest is the price men pay for valuing present goods more than future goods. It is a ratio of commodity prices, not a price itself.  Can we get rid of interest?  Mises argues that as long as there is scarcity, there will be human action, and hence, interest (525). Originary interest: the discount of future goods as against present goods (521).

Ricardo’s Law

Society accomplishes more when one group produces more of what it is good at.  If Group A is superior at producing everything, it still benefits from cooperating with an inferior partner. If Time = Money, then outsourcing frees up valuable time for A to produce what is more valuable.  Mises writes, “ If the surgeon can employ his limited working time for the performance of operations for which he is compensated at $50 per hour, it is to his interest to employ a handyman to keep his instruments in good order and to pay him $2 per hour, although this man needs 3 hours to accomplish what the surgeon could do in 1 hour.”

Criticisms:

Mises’s Utilitarianism is subject to some devastating defeaters, mainly Betrand Russell’s: the only way to justify an action is in light of its consequences, but the only way to justify whether those consequences are good are in light of the consequences’ consequences, and so on to infinity.

Fortunately, most of his system is salvageable from that.

Solving Crimes in a Libertarian Utopia

Someone shared this on my Facebook wall.

I was shooting heroin and reading “The Fountainhead” in the front seat of my privately owned police cruiser when a call came in. I put a quarter in the radio to activate it. It was the chief.
“Bad news, detective. We got a situation.”
“What? Is the mayor trying to ban trans fats again?”
“Worse. Somebody just stole four hundred and forty-seven million dollars’ worth of bitcoins.”
The heroin needle practically fell out of my arm. “What kind of monster would do something like that? Bitcoins are the ultimate currency: virtual, anonymous, stateless. They represent true economic freedom, not subject to arbitrary manipulation by any government. Do we have any leads?”
“Not yet. But mark my words: we’re going to figure out who did this and we’re going to take them down … provided someone pays us a fair market rate to do so.”

“Easy, chief,” I said. “Any rate the market offers is, by definition, fair.”
He laughed. “That’s why you’re the best I got, Lisowski. Now you get out there and find those bitcoins.”
“Don’t worry,” I said. “I’m on it.”
I put a quarter in the siren. Ten minutes later, I was on the scene. It was a normal office building, strangled on all sides by public sidewalks. I hopped over them and went inside.
“Home Depot™ Presents the Police!®” I said, flashing my badge and my gun and a small picture of Ron Paul. “Nobody move unless you want to!” They didn’t.
“Now, which one of you punks is going to pay me to investigate this crime?” No one spoke up.
“Come on,” I said. “Don’t you all understand that the protection of private property is the foundation of all personal liberty?”
It didn’t seem like they did.
“Seriously, guys. Without a strong economic motivator, I’m just going to stand here and not solve this case. Cash is fine, but I prefer being paid in gold bullion.”
Nothing. These people were stonewalling me. It almost seemed like they didn’t care that a fortune in computer money invented to buy drugs was missing.
I figured I could wait them out. I lit several cigarettes indoors. A pregnant lady coughed, and I told her that secondhand smoke is a myth. Just then, a man in glasses made a break for it.
“Subway™ Eat Fresh and Freeze, Scumbag!®” I yelled.
Too late. He was already out the front door. I went after him.
“Stop right there!” I yelled as I ran. He was faster than me because I always try to avoid stepping on public sidewalks. Our country needs a private-sidewalk voucher system, but, thanks to the incestuous interplay between our corrupt federal government and the public-sidewalk lobby, it will never happen.
I was losing him. “Listen, I’ll pay you to stop!” I yelled. “What would you consider an appropriate price point for stopping? I’ll offer you a thirteenth of an ounce of gold and a gently worn ‘Bob Barr ‘08’ extra-large long-sleeved men’s T-shirt!”
He turned. In his hand was a revolver that the Constitution said he had every right to own. He fired at me and missed. I pulled my own gun and fired back. The bullet lodged in a U.S.P.S. mailbox less than a foot from his head. I shot the mailbox again, on purpose.
“All right, all right!” the man yelled, throwing down his weapon. “I give up, cop! I confess: I took the bitcoins.”
“Why’d you do it?” I asked, as I slapped a pair of Oikos™ Greek Yogurt Presents Handcuffs® on the guy.
“Because I was afraid.”
“Afraid?”
“Afraid of an economic future free from the pernicious meddling of central bankers,” he said. “I’m a central banker.”
I wanted to coldcock the guy. Years ago, a central banker killed my partner. Instead, I shook my head.
“Let this be a message to all your central-banker friends out on the street,” I said. “No matter how many bitcoins you steal, you’ll never take away the dream of an open society based on the principles of personal and economic freedom.”
He nodded, because he knew I was right. Then he swiped his credit card to pay me for arresting him.

Review: Karl Marx, Early Writings

It’s rare that you get to see evidence of demonization in a writer, but you can see that with Marx. Accordingly, some essays are hard to read. That might not be entirely fair, though. Marx is dealing with Hegel–no easy writer himself–so one can’t exactly be clear. And to give credit to Marx, I think his critique of Hegel is interesting and points to tensions in the Hegelian system.

Thesis: Hegel cannot escape an alienation that exists between the people and the state.

Hegel’s logic: the Idea becomes a subject; other concepts, like political sentiment, become predicates of the Idea (Marx 65). The Idea is differentiated into its members.

At best Hegel can only say that the monarch embodies the abstract universality of the Idea. The concrete people do not. And concepts like “constitution” do not help at all. Constitutions do not create themselves; they are created. Yet, the constitution governs the legislature. How can the created control the creator?

Ontology of Violence

Hegel establishes the executive branch as the polar opposite of civil society. Each keep the other in check by suspicion. Marx rightly points out this cannot establish an organic union (116).

Economics:

Money represents an object’s intrinsic worth. The real value of a thing is its exchange value, “which resides in money” (262). And in this situation, all labor is wage-labor (268). And wage-labor alienates labor from its subject and object. Marx then makes a wild statement that inanimate objects do the acting: “exchange is mediated necessarily by the objects of mutual production and mutual possession” (276).

For exchange to take place there must be a common element of quantity between the two. This must be labor.

Criticisms

*Marx says that the worker is on the side of society, and the interests of capitalists is against the interests of society (300), yet it is undeniable that capitalists produce technology (medicine, scientific advancements, etc) that benefit society.

*Marx revisited some of his problems in Capital years later. Labor isn’t homogenous, so how can it serve as a uniform medium of exchange? Gary North points out the major flaw: “ If all profits stem from the employment of human labor, then it follows that greater profits can be made in businesses that are labor intensive. The more machinery one employs in the production process, the less profit should be available, since there are fewer laborers present to exploit….Yet what we do see is precisely the reverse: the most profitable industries tend to be those in which large quantities of constant capital are employed (Marx’s Religion of Revolution, 123).

There is a simpler problem with the Labor theory: when men exchange, they aren’t exchanging on the supposed equality of a third term in the equation, but precisely on the inequality–the goods are unequal in the traders’ eyes.

*Marx sees all credit systems as the fat cat capitalist oppressing the poor borrower. He never imagines a situation where the creditor lends to the government.

*Marx has no concept of time-preference, where he sees production only as the gratification of immediate selfish needs (274).

Review: Thomas Woods, Meltdown

I normally don’t read “crisis books,” especially when it involves the federal govt screwing up. However, knowing Woods to be a masterful scholar, and having a friend loan this book to me, I decided to read it.

6100516

All in all, a good read. I read it in about 3 hours. If one is reasonably familiar with the Austrian school of economics, this book won’t tell you anything new. Indeed, if you are an Austrian, you’ve probably figured it out. That being said, Woods summarizes the events leading to the 2008 debacle. He spends 2 chapters saying what went wrong and how government intervention is the culprit.

Chapter 4 is a summary of the Austrian theory on boom-bust. Ideally, the market determines interest rates.  When the FED artifically lowers interest rates and/or artificially increases the money supply, it encourages a boom in the production of longer-term projects. However, this production is not like that of genuine consumer interest. It is not in line with real consumer preferences and the current state of the economic pool. It draws real resources away from consumers. The Fed lacks the saved resources to finish projects and the consumer base to purchase the finished products (Woods, 26).

Chapter 5 debunks myths about the Great Depression. FDR, as most economists know today, didn’t get us out of the Great Depression and Herbert Hoover was no laissez faire man.

The next chapter explores the FED. Basic Rothbard.

His conclusion, while I agree with every word, will probably be ignored (and laughed at) by those who aren’t Austrians. That being said, and I am not a full Austrian man myself, it is hard to laugh at the Austrians–and the heroic Dr Ron Paul–when they have predicted the crisis almost to the dot.

Hoppe quotes on Democracy, the failed god

This is from “Journey into a Libertarian Future.”  They meant it as a slam against the Hoppean anarcho-capitalist project.  I don’t think they fully understood his arguments on time-preference.  Still, I thought it was funny and I am posting the quotes here.

property… is necessarily valuable; hence, every property owner becomes a possible target of other men’s aggressive desires. [255]

competition among insurers for paying clients will bring about a tendency toward a continuous fall in the price of protection… [281-282].

one regard[s] the central government as illegitimate, and… treat[s] it and its agents as an outlaw agency and “foreign” occupying forces [91].

One tries to keep as much of one’s property and surrender as little tax money as possible. One considers all federal law, legislation and regulation null and void and ignores it whenever possible [91]. One needs to be ready in case the government makes a move, and invest in such forms and at such locations which withdraw, remove, hide, or conceal one’s wealth as far as possible from the eyes and arms of government [92].

it is essential to complement one’s defensive measures with an offensive strategy: to invest in an ideological campaign of delegitimizing the idea and institution of democratic government among the public [92].

[A]s for the economic quality of democracy, it must be stressed relentlessly that it is not democracy but private property, production, and voluntary exchange that are the ultimate sources of human civilization and prosperity. [105]

the U.S. government has become entangled in hundreds of foreign conflicts and risen to the rank of the world’s dominant imperialist power[?] [How] nearly every president [since 1900] has also been responsible for the murder, killing, or starvation of countless innocent foreigners all over the world [244]….U.S. president in particular is the world’s single most threatening and armed danger, capable of ruining everyone who opposes him and destroying the entire globe. [244]

create a U.S. punctuated by a large and increasing number of territorially disconnected free cities – a multitude of Hong Kongs, Singapores, Monacos, and Liechtensteins strewn over the entire continent [291]

no-tax free-trade haven[s], large numbers of investors and huge amounts of capital would begin to flow immediately. [132]