Thursday, May 17, 2012

Reply to @benbencatdog 1


I do not wish to continue to over-populate our follower's timelines with tweets that will inevitably lack context for the casual reader of our twitter accounts, so if you are amenable, I would like to continue our discussion here.

I'm pleased to hear that you are agreeable, to what you have called, "natural laws"; I also find agreement in a natural law theory.  Perhaps if you are inclined, you could briefly describe for me, what your conception of a natural law theory consists of, so that I may determine if it corresponds to my own theoretical speculation.

You asked if fraud, would come under the heading of theft in my own understanding and I can assure you that it does.  I use "force" to describe all violence of the overt kind, "coercion" to describe all threats of overt violence intended to control/dominate/oppress others into obeying the commands of the threat out of fear of punishment, and "theft" do describe all violations of external property/material-right.  Fraud then, is the misrepresentation of the offer of exchange, such that, if the article was legitimately represented, the other party would not have agreed to the exchange; this, it seems quite clear to me, is a kind of theft which does not involve force or coercion but is theft nonetheless.  For example, if a car-salesman were to misrepresent the condition of a car (were to say it was "very reliable" when the salesman is aware that there are mechanical/reliability issues with the car), then the buyer agrees to buy the car for a set price or agreement, then there is a contract or agreement between the salesman and the buyer for a "very reliable" car.  The misrepresentation of one side of the agreement (fraud), invalidates the premise of the agreement; it is as if the agreement never took place because .  While the salesman might object to the assertion that his improper representation of the product, invalidates the sale, assuredly the salesman would have the same cause to object if the customer had paid in counterfeit money!

I think we may be in agreement that ethics concerns rights and the violation of rights (I suppose this because of your comment about natural law), but I am concerned with the philosophical implications of using "harm" as an ethical descriptor as "harm" can be interpreted very subjectively; one person's "harm" is another person's pleasure.  So perhaps you could explain how you might resolve this kind of problem... or whether you see it as a problem at all.  For myself, I am skeptical of ethical theories  that reduce to one person's, or one set of persons', subjective/arbitrary opinion/preference/taste.

Similarly, I am concerned about statements similar to "harm to the environment", as this seems to anthropomorphize material states as if they were persons.  Perhaps this was not your intention/implication at all but I would like some more clarification on this account.  For me, "harm to the environment" is doubly troubling, as it has the issue of subjectivity incumbent on the common use of "harm" and seems to imply that material states have the same ethical status as persons.

You had asked about what you saw as an issue in the "third-world", if a place had an open market of voluntary exchange and some other place had decided to "dump cheap rice" in that open market, what would happen to the impoverished farmers that grew food and had to 'compete' with that "cheap rice".  This is an excellent example of how the economic principle of comparative advantage would function to the benefit of all. 

Clearly, in your example, this "third-world" place, would seem to have some inherent disadvantages in the production of many goods.  Such that, this productive-rice-growing place, can sell their rice at a lower price, than all/most of the rice producers of this "third-world" place.  It is obvious that some change is occurring in the example that you provide, for if this productive-rice-growing place had "dumped" its "cheap rice" on the market the year before, conditions in this "third-world-place" would have already to have begun to stabilize as the individuals in the market would be in the process of reorganizing production processes.  Such that, either the productive-rice-growing place has become even more productive this year than last, or transportation has improved or preservation methods have improved, or on the other side of the coin this "third-world" place may be experiencing some particular causes of reduced production (reducing the supply, and demand remaining constant, increases the market clearing price) such as drought, or vermin, or disease, or war, or any number of conditions that can disrupt food production processes.  While the productive-rice-growing place, selling its rice at a price lower than this "third-world" place will cause a difficult time for the rice-producers of the "third-world" place, it will have great benefit to the people consuming rice in the third-world place.  They will have to give up less value to purchase rice, than they would have if the productive-rice-growing place did not sell in their marketplace.  The rice-producers of the "third-world" place will naturally grow less rice next year, than in previous years, as the profitability of rice growing there has decreased.  Some marginal land that was used for the production of rice in the "third-world" place, will likely be used for more profitable crops or uses. Some of those employed in the business of rice production this year, will next year, anticipating less gain through the production of rice next year, will change their labors to more productive ventures.  Each person taking advantage of their own particular strengths, they will anticipate what will bring them greatest value and satisfy more of their needs/wants/preferences.  Thus the "dumping of cheap rice" will be a great boon to the people of this "third-world" place in the long-run, for the natural advantages of the productive-rice-growing place in producing rice, means the people of this "third-world" place need not spend so much of their time and labor in the production of rice, and may instead, redirect those energies to more profitable ventures.   The real problem comes from the "dumping of rice" when it is done, not by individuals in the market place, but influenced by political-forces. Have you read, "The Road to Hell: The Ravaging Effects of Foreign Aid and International Charity" or "Dead Aid: Why Aid Is Not Working and How There is a Better Way for Africa"?  Both books describe the terrible effects of "dumping" free-aid (even in the form of food) to places in Africa and Asia.  Such aid often goes to feed the armies/militias that oppress the people, the food was meant for and even when it reaches the people this year, the local food-producers can not compete with 'free-food' and they are ruined and the next year, when the aid distribution is disrupted, the people starve.  The social-problems are caused not by voluntary-exchanges but by the institutions of domination.

Well, I hope that that explanation of my conception of comparative advantage will explain my argument that the set voluntary-exchanges, happens to distribute wealth more evenly (because, as I described in you example, even the "dumping" of "cheap rice" will be a great boon to the people of the "third-world" place, such that, if the market was not open, and this voluntary-exchange of "cheap rice" was not permitted to take place by some institution of domination, then the people of the "third-world" place would be much worse off than they would be otherwise).  Voluntary-exchanges take place, because both parties anticipate being benefited by the exchange taking place; which is to say, in voluntary-exchanges, the self-interest of both parties is pursued and most generally, both parties are benefited.  Voluntary-exchange is mutually beneficial to all parties.  Compare this to theft, coercion and violence; these only benefit one party and usually to the great cost of the other party.  If for no other reason than the greatest satisfaction of human desires/preferences/needs, we ought to always condemn force, coercion and theft and we ought to celebrate all voluntary-interactions!  :-D

1 comment:

  1. Imagine if you had to teach about comparative advantage on twitter. With 140 character bite-sizes chunks along with the distractions of the person's timeline. (!!!). I like to bring these concepts down to the personal level. Illustrating Comparative advantage at home between collaborating roommates, etc. The problem with Keynesian economics is that it seems to divorce the macro from the micro while Austrians view both as being subject to the same natural laws, just at different scales. I go as far as to explain the phenomenon of inflation in the span of a single day. Its possible. Great mental exercise I'd share someday in a song.
    On the subject of Africa, I've been to Angola and I do business with other parts of that continent. State meddling and central planning festers all over and interrupts peaceful voluntary exchange. Ask anyone who works for a freight forwarding company that ships to Angola what this week's regulations are. Ask them again next week. I'm not joking.
    Jacob, you're going to have to start handing out copies of Hazlit's "Economics in One Lesson" and hope for the best. You efforts in this cause will not go unnoticed. Thanks!