Notes on the Eighth PFS Conference in Bodrum,
19th-24th September 2013
Conferences of the Property and Freedom Society are arranged so that half hour speeches are followed by fifteen minute coffee breaks, and each of the three days has a very long break for lunch. The last session of each day is about an hour long, and all the speakers of that day sit on the stage to take questions from the audience. This is an arrangement that emerged after the first experimental Conferences in 2006 and 2007, and it works very well. There is very little that cannot be said in thirty minutes – in most cases, giving people more time only encourages padding – and the coffee breaks are always welcome.
This is my seventh report of a PFS conference, and there is a limit to how many times I can praise the attendant circumstances – the fine accommodation, the endless gossip and debating over dinner, the balmy weather, the joy of walking about the city where Herodotus was born, and so on and so forth. Let us therefore take all this as read, and get on with a summary of the Some of my summaries are longer than the others. Some are in more connected prose. This may reflect a bias of my own interests, or an occasional wandering of my attention. There will, in due course, be a full video record on the Internet, and this will correct the defects of my written account.
[Further Note – 21st September 2015: These are notes I took at the time. I did intend to work them up into a full report for publication. However, I was busy with other things after my return from Bodrum, and I forgot about the notes. I have now found them again, and have decided to publish them without amendment. In some cases, my notes are inadequate – Professor Hoppe’s speech, for example, is not well-reported. Again, my report of Stephan Kinsella’s speech is unfair, as I make it into a dialogue between us on limited liability. But, unless you care to sit through all the videos, what I have written is the only account of the conference. I publish it for this reason. SIG]
Friday the 19th September 2013
David Howden, Labour Laws: Legislating Unemployment
The recession in Europe is worse than the official accounts say it is. However, there are grounds for optimism – or would be, but for the European Union’s responses.
It is worse, because most of the alleged economic growth since 2008 has been in the state sector. Only in Holland and in Italy has private growth been faster than state. In countries like Spain, the overall economy is shrinking, and so is the private share of this.
The good news is from the shadow economy – that is, those activities not reported to the authorities. Reasons for non-reporting include evasion of tax and regulation and reporting requirements; illegal goods and services.
There are various techniques of measuring the shadow economy. For example, assume all shadow activity is paid for in cash. This done, estimate how much cash is needed to finance the activity. Ask the central bank how much cash is in circulation. Deduct from this the amount needed to finance official activity. The remainder may be a good measurement of the shadow economy.
In general, the shadow economy is a smaller proportion of the whole in northern than in southern Europe. One reason is that countries with a better rule of law and more honest administration provide better reasons to operate in the formal economy. Another is the scale of belief that taxation is theft and that taxes are incompetently and corruptly spent. Then there is effectiveness of policing. Not surprisingly, in places like Greece and Spain, the shadow economy is about 40 per cent of the whole.
It is harder to estimate how many people are engaged in the shadow economy. More assumptions are needed, and more assumptions mean a greater chance of reaching the wrong answer. But it seems that actual unemployment rates are substantially lower than the official figures suggest. Spain, for example, has an unemployment rate of 27 per cent, but the perceived level of activity suggests higher rates of participation.
The response of the authorities has been to tighten policing – spot checks on businesses to see that workers are registered; limits on the use of cash, etc. The claim is that tighter policing will drive activity from the shadow to the formal economy. There is no probable truth in this, however. The formal economy will only grow if the tax and regulatory burden is low and equitable enough to justify private investment. Therefore, government responses are throttling the European recovery.
Mateusz Machaj, The Keynesianism of Milton Friedman
Milton Friedman has two faces. He is a radical libertarian – often very radical. But his technical economics are generally more favourable to interventionism. In particular, there is his claim that the Great Depression came about because of a failure by the authorities to print enough money to prevent the deflation.
These two faces are both surprising and a disappointment. His technical work undermines his wider libertarianism. And it is a fundamental error.
Friedman’s academic work as an economist begins with an acceptance of the Keynesian approach – a focus on aggregates and a belief that monetary policy has real effects on the aggregates. According to Paul Krugman, he would have supported some kind of quantitative easing. Friedman disagrees with the Keynesians chiefly over their emphasis on fiscal policy as opposed to monetary.
But leave aside whether or not he is a Keynesian – the monetarist economics that he considered his most enduring achievement are simply irrelevant. His monetary rule – that the money supply should be increased in order to stabilise the price level – relies on the ability to measure the money supply. This allows effects to be predicted and measured. During the past 30 years, financial innovations have made it very hard to define money, and therefore to measure changes in its quantity.
Nikolay Gertchev, Entrepreneurship and Betting: What, if Anything, Can Businessmen Learn from Betting Odds?
The entrepreneur and the gambler are seen as opposite types – rational calculator v the impulsive shirker. However, they have a lot in common.
First, they risk their own property. Second, they operate in inherently uncertain environments, and work to reduce the uncertainty.
NG goes into fifteen minutes of close reasoning about the Mises probability theory. Human action takes place because there are things of value that people do not have. His economic theory is based on a priori reasoning and on introspection. It does not rely on evidence, but explains reality. We call this praxeology. But this says nothing about the causal relationship between means and ends. This requires much experience. Because our knowledge of the world is inevitably defective, we must rely on probabilities. There is a learned discussion of objective and subjective probabilities.
Entrepreneurship and betting are both founded on calculations of risk and uncertainty. An entrepreneur speculates on the future behaviour of his customers and competitors. Betting odds reflect the average opinion of betters on the chance that something will happen.
The similarities are particularly evident in the derivatives markets.
Roman Skaskiw on Bitcoin (an optional session)
The State is organised violence, but violence can’t do maths. Bitcoin is a decentralised system of exchange that uses cryptography and allows pseudonymous and soon perhaps completely anonymous transactions. These are instantaneous and can take place anywhere in the world for both large and small amounts. Bitcoin competes with state money.
16 per cent of US retail sales are now on-line. There is an obvious advantage to using Bitcoin.
RS talks about precursors to Bitcoin – PayPal, E-Gold, etc. Bitcoin differs in that it is decentralised – There are no offices to raid, no people to arrest, no records to sequester.
It began in 2009. Early transactions were mostly experimental. Prices of Bitcoin were volatile at first. But diminishing confidence in state money and state-controlled banks is raising wider interest in Bitcoin. There are 11.5m Bitcoins as of September 2013. Total number soon will be 21m.Total value is about $1.6bn. It is now possible to live by spending Bitcoins. It is possible to buy houses. Agorists in New Hampshire have abandoned silver for Bitcoins. Also, it was used for donating to Wikileaks after PayPal account the relevant closeds.
Moves to an explanation of Bitcoin mining. For transactions to be secure, computer cryptography is needed for verification and registering. This is labour-intensive. Therefore, those performing the calculations are rewarded by new issues of Bitcoins.
From this, he goes into technical details that are beyond my understanding.
Bitcoin might be the herald of peer-to-peer monetary system. Bitcoin is open source, and all changes are made by consensus.
Attempts at regulation have so far been confused. The American authorities have been rather hostile. Not so Canada or some European countries. The legal status is unclear in many countries.
Will big software companies get involved? Whether or not, there is no way to stop Bitcoin. It cannot be monitored. Therefore, it cannot be controlled.
This is a very good speech, and it goes on longer than scheduled. However, there is much sceptical questioning from the audience. People doubt that Bitcoin cannot be regulated or destroyed. They doubt its security and stability. I say something like this:
“Governments in the rich world are mostly not stupid. They seldom inflate money to nothing in the short term. They hardly ever confiscate savings from bank accounts. They leave us reasonably alone to accumulate wealth. For this reason alone, I see no use for Bitcoin except for illegal transactions – which in itself opens users to surveillance and persecution. Also, I trust my state-regulated bank more than any decentralised and anonymous monetary system that I do not fully understand. If money goes missing from my bank account, I know for sure whom to complain to and how to complain. What happens if I have money in Bitcoin, and the whole system just vanishes one day in a puff of smoke?”
No satisfactory answer to that question. A good speech, but fails to convince.
Thorsten Polleit, Organised Crime and the Progression Towards a Single World Fiat Currency
Organised crime may be defined as activity having a permanent structure to enable extraction of unlawful gains. The usual example of organised crime is the mafia. A better example is the State – it has the power to tax and the power to enforce ultimate jurisdiction.
Normal justifications of the State are from Plato, Aristotle et al – the State is needed to define and protect property. But property exists without a state. The State is less likely to have come about via social contract than by naked aggression. Also no one with any sense would sign such a contract.
How does the State, which benefits the few at the expense of the many, maintain itself? Either it uses or threatens violence, or it uses propaganda and a sparing distribution of the spoils of taxation. TP quotes Hoppe on the public ownership of government, and the tendency of majorities to elect bandits. In particular, democracy destroyed the gold standard.
He moves to discussion of the tendency of the main states in the world to reduce currency competition by creating a single fiat currency for the whole world. There are calls for the International Monetary Fund to become a central bank for the whole world.
This would be a disaster. Short term effects may be a more robust monetary order. Longer term effects will be world government. This cannot be democratic, but must be despotic. So long as there is ethnic and cultural diversity amount humanity, there can be no world government.
Paul Cantor, What Literature Can Teach Economics
Differences between literature and economics. But both connected with the idea of spontaneous order.
Idea that commerce and only corrupt culture, and this has led to much hostility from artists towards free market capitalism.
Great literature is often seen as an organic whole – every part contributes to the perfection of the whole: change one part and the whole suffers. Examples are Shakespeare sonnets. Great artistic genius has created a single moment of perfection. Great literature is said to exist outside time.
Artist is often said to be autonomous creator. Therefore, commercialisation said to harm artistic integrity. Compromise is deprecated. Therefore much support for government funding of the arts. Government is called on to shield artists from pressures of the market.
Artists are often socialists because of the working habits. They plan their works and execute them. They have total control over plots and characters. They carry this over into their economic views. This might explain why so many artists like dictatorship. We see this in much utopian fiction – generally, a perfect society is conceived as a socialist despotism. For example, H.G. Wells.
Another idea of literature is that great novels often go through an evolution. Look at serial publication in the 19th century. These were planned, but always changed in the course of writing. Quite often, they were changed in response to continuing sales figures. We can see this in the novels of Charles Dickens. Few of these have the perfect consistency that is called the highest quality of great art.
Was this an example of how commerce corrupts literature? Or were these novels products of cooperation between author and readers via the marketplace?
Writing a novel should perhaps be seen as a discovery process, just like any other act of entrepreneurship. Should not regard everyone but the author as a negative force.
Culture and commerce not antithetical. The contrary is much exaggerated.
Questions and Answers: Howden, Machaj, Gertchev, Polleit, Cantor
Mostly directed to Paul Cantor, whose talk was the most interesting of the day. SIG asks a question that amounts to a puff for his latest novel!
Saturday the 21st September 2013
Eugen Schulak, Friedrich Nietzsche – Right Wing Anarchist?
Introduction – FN in his times. Predicted wars followed by nihilism. These are consequences of democracy. Will end in transvaluation of all values – carried out by intellectual elite.
Was he an anarchist in the Mises/Rothbard tradition? Possibly. Rejects the State as not interested in truth. Any alliance between philosophy and the State requires philosophy to support the State rather than the truth. Therefore, he believed in a very small state. Did not believe the State could or should produce general security. Rejects democracy and nationalism and militarism.
However, this critique is not placed within any scientific framework. Speaks at length, with close reference to various texts. Speaking for myself, the whole mass of German philosophy isn’t worth a single railway bridge built by Brunel.
Sean Gabb, Understanding England and the English
I’d like to begin by thanking Hans and Gulcin for their great kindness in inviting me once again to Bodrum to address the Property and Freedom Society. But where to begin with the title that Hans has set for me? I could take the patronising approach taken by many Englishmen when called to speak about their country to an audience largely of foreigners. Whether I talk about Shakespeare, the Changing of the Guard and Churchill, or gush about the sinister pantomime that opened last year’s Olympic Games in London, it would have the same implied message. You see, we are an extraordinarily nationalist people. Our nationalism, however, doesn’t cause us to hate foreigners. Instead – and this applies also, and indeed particularly to Americans – we don’t hate you: we just feel sorry for you.
But I’ll not patronise you this morning. I’ll even avoid telling you the truth – that, in the development of our modern civilisation, two great nations have the greatest honour: England and Germany; and that, of these two, England is by far the greatest. What I will do is confess what you must have noticed for yourself – that something has gone badly wrong in England. Exactly when the rot began is a subject that would require far longer to discuss than the time given to me this morning. But you can see the earliest plain evidence of national derangement when the Princess of Wales died in 1997. I watched in horror as the mountains of flowers piled up, and as the funeral was made into a carnival of insanity.
The examples have multiplied beyond counting. I won’t give examples of the multicultural frenzy. Instead, I’ll talk about the sexual mania.
First, there is the legal privileging of homosexuality. In doing this, I speak with much security. I began denouncing the laws constraining homosexual conduct when I was a schoolboy – at a time when what I was saying might have got me roughed up in the playground, and certainly got me funny looks from other boys and teachers alike. I also wrote one of the earliest and best analyses of the Spanner Case. Since then, though, persecution has given way to privilege.
Take, for example, the case of the Rev. Alan Clifford, Pastor of the Norwich Reformed Church. A few months ago, the Norwich Gay Pride organisation held a rally in the middle of Norwich. Dr Clifford and four members of his congregation attended and handed out leaflets of the usual kind. Afterwards, he sent the leaflets out to everyone on his mailing list. This now included the leaders of Norwich Gay Pride. They complained to the police, and Dr Clifford was visited in his home by the police. They told him that a homophobic hate crime had taken place, and gave him the choice of confessing, in which case he would be given a police caution and made to pay a £90 fine, or of denying guilt, in which case he might be prosecuted.
Not surprisingly, Dr Clifford chose to deny his guilt. If the authorities ever do take him to court, they will probably get a bloody nose. Dr Clifford is a Calvinist. His sort drove Catholicism out of England in the 16th century, and pulled down the Stuart state in the 17th. He will turn up in court with the Bible in his hand and speak to a public gallery filled with his congregation. But his example is important as illustration. There is a regular persecution of Christian street preachers in England. There are new cases several times a year.
The next example is of the Late Jimmy Saville. During his lifetime, he was adored by the media for his charity work and his public eccentricity. When he died in 2011, enough hot air about him went up to fill a balloon. Then, in 2012, it came out that his sexual taste had been for pubescent girls. The media went hysterical. His family joined in. Early in 2013, his grave stone was torn up, its inscription ground smooth, and then smashed into small pieces and taken off for landfill.
I suggest this is evidence of great mental derangement. It is certainly unEnglish. The custom so far has for the dead to be left to rest in peace.
These are two examples of the madness that has gripped England. Of course, the madness is not universal. If you look at the continuing popularity of Gary Glitter, it seems that many people – perhaps the majority – do not partake of the madness. But it can be seen in every organised area of our national life.
What is the cause? The answer is complex. There is no single cause. But one cause worth exploring is the unbalancing of our Constitution during the 20th century.
In 1908, Rudyard Kipling published a short story called “The Mother Hive.” In this, the bees in a hive decide to drop all outmoded ideas of hierarchy and to make everyone equal. This includes the right of workers to eat royal jelly and to mate with the drones. In the spreading chaos that results, traditionalist dissidents are first shunned and then murdered. Eventually, the bee keeper looks into the hive, and sees the empty honeycombs and the horribly deformed offspring of the workers. His response is to poison all the bees.
Now, something like this has happened in England. In the past few generations, the whole of national life has been taken over by the cultural Marxists. They run government and the administration, and the law, and education and the media, and business too. They have imposed on us a nasty hegemonic discourse. Cultural Marxism is ultimately to be traced to European thinkers like Antonio Gramsci and Louis Althusser and the Frankfurt School. But this has come to England in American clothing. It has prestige because it was taken up by the American universities.
In America, however, the progress of cultural Marxism has been resisted, or slowed, by a strong religious right and by a written constitution that it is taking a long time to subvert. Here, we have no religious right, nor an entrenched constitutional law. In the past, freedom and common sense were safeguarded by an hereditary land-owing aristocracy and gentry. These ran the country, and did much to determine its moral tone. During the 20th century, they were marginalised and then eliminated from government. They remain as a class – still very rich – but the tacit deal since at least the 1940s has been that they will be left alone, so long as they keep out of politics. Government has been left to middle class lefties. The effect followed the cause only after several generations. But here it is.
It may be interesting for you, as foreigners, to learn an answer to the implied question in the title of this speech. But it is essential for the English to think about the question and its answers. You see, like both the Germans and the Russians, we have had a revolution. Unlike them, we have had no obviously revolutionary event. The Russians had the storming of the Winter Palace and the murder of their Royal Family. The Germans were utterly defeated in 1945. Their cities were bombed flat. Their country was occupied and divided. Every German knows either that German history came to an end in 1945, or at least that a new chapter in German history had begun.
We do not have that awareness, and it would be useful for us to understand, even so, that we are living in a state of revolution. England has become the Mother Hive.
Robert Nef, Understanding Switzerland and the Swiss
Switzerland is not a model for others to imitate, but an experiment. Sadly, it is an experiment that must end in a centralised and despotic state. On the other hand, it is still a better place than most countries in the European Union.
The country can be best explained by the analogy of the Beata Crucis.
Station 1. The Swiss love monarchy
Station 2. Direct democracy – Landesgemeinde. Most government proceeds by show of hands in small assemblies open to all citizens.
Station 3. ???????
Station 4. The country is not a traditional nation state. The constituent nations do not love each other, but get along. Analogy of the hedgehog.
Station 5. Even so, strong national pride.
Station 6. The Swiss think of themselves as special. Their federation arose from the need to protect their territory and their liberties from conquest by their neighbours. Unlike in other nations, the State does rest on an historical contract.
Station 7. Tension between William Tell and Rutli.
Station 8. The fundamental principle of neutrality.
Station 9. 20 per cent of the population are immigrants. 80 per cent of violent criminals in prison are immigrants. But citizenship open to foreigners of good character who can be adopted by vote of one of the communities.
Station 10. Switzerland not decentralised but non-centralised. The distinction is important. It means that individuals can secede from one community and seek adoption by another.
Station 11. All able-bodied men are enrolled in the militia. And most parliamentarians are part-timers.
Station 14. The Swiss have a sense of humour.
Anthony Daniels, Public Health or Public Totalitarianism? A Report from the Medical Journals
World Heath Organisation defines health not as the absence of disease, but as complete physical and moral well-being. Good health is a desirable state – unless you are a beneficiary of the welfare state, when alleged ill health brings financial advantages. But the definition adopted legitimises virtually all activity by the authorities to make us healthy. It allows doctors and health bureaucrats to entertain the wildest utopian fantasies.
For example, The British Medical Journal recently suggested that all legislation should consider its effects on public health. Again, there has been a great multiplication of mental illnesses that have no physical symptoms.
Another consequence has been the centralised mandating of therapies on the grounds that they will bring about statistical improvements in the health of particular groups. There is mass-screening. The authorities never consider the harm done by screening – for example, the possibility of over-diagnoses. There is a bias against considering whether the good of screening is not outweighed by its harm.
Another consequence is regulation of lifestyle based on bad epidemiology. See, for example, the American Government’s order to the food companies in the 1970s to reduce fat. They responded by increasing the amount of sugar. In fact, the link between fat and obesity and diabetes was based on flawed research. See also the Bangladeshi arsenic poisoning.
Questions and Answers: Schulak, Gabb, Nef, Daniels
No notes taken
Sunday 22nd September 2013
Richard Lynn, Why are the Jews so Smart?
Before answering this, various preliminary questions. Are the Jews smart? How many of them are smart? Can smartness be measured?
Before the 19th century, not much interest in the Jews, nor much contact with them. Changed with emancipation. Soon became evident that Jews were clever. Ricardo and Nathan Rothschild in England, and Disraeli. Increasing prominence during century all throughout Europe. Meyerbeer, Mendelssohn, Mahler, Karl Marx, et al, et al.
Cleverness noted by Francis Galton in Human Genius, 1876. Also Gobineau and Mark Twain. General consensus view. Invention of IQ tests in early 20th century. Test children at seven for IQ, and this measures intelligence and general progress through life.
Richard Lynn has devoted his life to measuring the differential intelligence of the races. This can be said of the Jews:
British Gentiles 100
Ethiopean Jews 69
Not surprisingly, the Ashkenazim, from Russia, have a dominant influence wherever they settle and are allowed to flourish. The Sephardim, from Spain, dispersed throughout the world, mostly to the Balkans. The Mizrahim, largely resident in Iraq and Iran, mostly moved to Israel after 1948. The Ethiopean Jews are Africans.
NE Asians 105
N Europeans 100
S Europe 92
US/UK blacks 85
N Africans ??
Ashkenazis good at verbal rather than special reasoning. Therefore prominent in law, science, literature, etc. Not so good in engineering and architecture.
Jewish ability became a concern in America c1920. Massive overrepresentation in universities. Previously admitted on basis of intelligence tests. Now, other criteria established to reduce Jewish numbers.
Possibly because they practised eugenic selection over many centuries. To become a rabbi required great intellectual ability. Also brought great prestige, and rich men wanted their daughters to marry rabbis. In a world where the rich had more surviving children than the poor, this would, over many centuries, raise average IQ.
Possibly because of persecution. More intelligent Jews escaped, less intelligent killed off. Result was rise in average IQ.
Concentration on money lending – selection for intelligence.
Apostasy theory of Charles Murray. Decline in Jewish numbers in early Christian centuries. Possibly because less intelligent ones dropped out on account of onerous learning requirements.
Theory that intelligence gene mutated among Ashkenazim c1200, and spread throughout population. This rather speculative – gene postulated, not yet discovered.
Likely that all played some part in bringing about the current situation.
Jared Taylor, A Brief History of US Race Relations
Conflict endemic in human affairs. One of the most common reasons for conflict is race. Two races in same territory will almost inevitably produce conflict. American race relations began in 1607 in the Jamestown settlement. English settlers disliked Spanish brutality and had no set ideas of racial superiority. Tried to be nice to the Indians. Built no fortifications. But Indian attack that would have ended in massacre had someone not scared them off by firing cannon. Afterwards, discovered that Indian neighbours disliked them the most. Trade and relations best with more distant tribes.
Further history of Anglo-Indian relations. 22 March 1621, plan to murder all English. Indians did in fact murder a third of settlers. Return to peace. Then, in 1644, another attempt. This followed by English counter-attack that destroyed Indian power.
Relations with Indians characterised by trust and good feeling. But presence of English seen in itself as offensive. Indians wanted newcomers out. However, English civilisation provoked into total dispossession.
No generalisations possible about black slavery. Variations between colonies. Variations in same colonies over time. Variations between individual owners. But often very good masters. Oral history project in 1930s – many former slaves spoke well of masters and looked forward to meeting again in heaven. Don’t forget – not all blacks in South were slaves, nor all owners white.
Slavery can be described as one way of managing racial conflict – though depended on brute force.
Most abolitionists wanted to free slaves and then send them back to Africa. Even Lincoln wanted to expel freed blacks. Wanted to send them all to Central America.
Whites feared not only conflict, but miscegenation. Most states had laws to ban interracial marriage. 16 States still had such laws until 1967.
Admits that whites often behaved badly. 4743 lynchings. But about a quarter of hanged were white, and some hanged by blacks. In most cases victims may have been guilty. Most lynching for murder. Not imaginary crime.
Race riots – whites in past willing to go on attack. Last white offensive in 1943. Since then, race riots mean black and other ethnic violence. Mentions Rodney King riots.
Revolution in white racial attitudes. Until 1950s, most whites believed that different races unable to live together in peace, and wanted immigration only by whites, and that blacks already among them should be pushed into own areas. Since then, radical transformation of thinking. Now public believe that race is social construct – no differences. Whites have no valid interests, so illegitimate to organise for defence. Whites should welcome diversity in all areas and all respects. Reduction of whites to minority status widely celebrated. Miscegenation also celebrated. But all other races encouraged to show solidarity with each other.
Because all races supposed to be equal in intelligence, non-white failure has to be seen as evidence of white racism.
Predicts American slide into third world status. Mentions SIG claim that this good for rest of the world. Conflict and tragedy.
Hans-Hermann Hoppe, On the Nature of Man, Truth and Justice
Last two speeches about empirics of mankind. This will be about the commonality of mankind. Will go back to roots as philosopher rather than economist.
Possible to explain man in naturalistic terms. But, though legitimate, purely naturalistic explanation of man not sufficient to understand complexity of human condition. Unable to make naturalistic analysis of most human thought – especially that connected with search for truth.
Man can argue. A priori of argumentation. Transcendental argument – answers to the sceptic who denies that there is ultimate justification and a priori truth. What is presupposed by argumentation?
Argumentation presupposes action. Even most of speech acts are not argumentation. Most of the time, we do not speak when acting.
Argument is a special case of Misesian action.
Argument is a form of communication, most communication not argument. We speak for many other purposes.
(Achievement of social sciences often belittled. But most communication is successful. Conflict is rare. Speech is very successful at bringing about coordination of action. Greater eloquence brings greater success.)
Most action is silent. Most knowledge is tacit. Most action is successful.
Why argumentation so special?
Tried to refute behaviourists who want to explain man purely in terms of the natural sciences. And also sceptics who want to deny that there is an essential and unchanging human nature. We do know the difference between right and wrong and we know many other a priori truths about man. Refutation of Hume and Hobbes. If a solipsist argues in writing, he is inconsistent with his stated belief.
Norman Stone, World War II Revisited
How to talk about the second world war in half an hour? Best turn it into two questions: How did Germany fall into the state it was in by 1939? How did other countries interpret their success in the war?
The weakest charge laid at Nuremberg was that Hitler had planned a world war. Goering made a fool of the prosecution. However, Hitler should have known that Britain would fight over Poland, and he still went ahead and invaded. Chamberlain didn’t want to go to war. He told the American Ambassador that it would end exactly as it did – with Europe in ruins and Russian domination of half of it.
Hitler wanted back the Europe of Brest Litovsk. Very clever, but also a very nasty, vindictive man – never performed a single chivalrous act. Two big advantages. First, it is very hard to set up a small party. These things split easily. Hitler had immense charm when it was required, and could explode with rage when required. He also made sure to keep control of all the money: the NSDAP was Adolf Hitler trading as. His second advantage was he was a gifted speaker and writer. He kept the party together all through the 1920s, until the post-War system collapsed after 1930.
The collapse was inevitable, because Weimar was doomed from the outset – too much democracy to no effect. Also because the new post-Hapsburg states were divided over whether Russia or Germany was the main enemy.
Further advantages were the revelation of the French defence strategy when the Maginot Line was built. Also, America was out of things. Hitler knew that he only had to worry about the British.
There was no question that Britain could be beaten. The Navy and RAF were supreme. There was a world empire. The only weakness was to devote too much effort to holding Singapore.
But it can be argued that the British response to winning the war was fundamentally mistaken. The welfare state was badly put together and morally corrupting. British foreign policy was based on the false assumption of continued great power status.
Russia also made mistakes – belief in world power status, but supported by a weak economy and collapsing society. Has much sympathy for Mr Putin.
America seemed to have got things right. Wonderful domestic order. Put Germany and Japan back together. But led to delusions of invulnerability.
Germany and Austria have done well. Readable press, infrastructure that works, very civilised place. German influence in Eastern Europe wholly benign. Perhaps all the bombing was a force for good after all.
Stephan Kinsella, The role of the Corporation and Limited Liability in a Private Law Society
Murray Rothbard once asked Mises for a clear distinction between a free and a socialist economy. The answer was possession of a stock exchange – crucial to the existence of capitalism and private property.
Now, a stock exchange means the existence of joint stock limited liability corporations. These exist in order to minimise transaction costs. There are upper limits to their size. Other forms of business organisation – sole traders, partnerships, etc.
Defines corporation – state registration which gives legal personality, perpetual duration and limited liability. Company “owned” by the shareholders.
Critics focus on these features as state-granted privileges. Early critics from the left like Ralph Nader. Argued that privileges should justify heavy regulation to enforce good and responsible conduct. Also many libertarian critics.
Would limited liability exist in a free society? Are corporations like roads? Presently state built and maintained, but obviously would exist in a free society. Or like marriage? Or are they like patents and copyrights, which are purely creatures of legislation?
Leftists believe that corporations should exist and be regulated. Conservatives believe the same, though with less regulation. Some libertarians deny their legitimacy, and want them to be abolished. These libertarians also believe that the existence of corporations makes for a more hierarchical society and deplore the expansion of employment.
According to SK, entity status could be created in a free society by agreement. Separation of ownership and control can be brought about by private agreement. Limited liability – two types of liability: contractual and tort. No problem with contractual limited liability. Arguments about tort, however, are based on the assumption that the shareholders ought to be responsible for the debts. But why should the shareholders be vicariously liable for the torts of others? Critique of respondeat superior and vicarious liability. People should not be responsible for the acts of others. Ownership does not bring responsibility. Example of gun companies
Questions and Answers: Lynn, Taylor, Hoppe, Stone, Kinsella
Very sharp questioning of Jared Taylor. Even much hostility from audience.
Re Kinsella speech,SIG asks this question: “Stephan, I’d like to thank you for so clear a summary of your argument, and for so fair an exposition of the opinions of those who disagree with you. However, I find your analogy of the gun shop defective. If I sell a gun to somebody, who then goes and shoots someone, the decision of the buyer to commit a crime is a new intervening cause and breaks the nexus between me and the crime. But let us take this example. I am a sole proprietor running a delivery company. While going about my business in my time, one of my drivers causes an accident and hurts someone or damages valuable property. The driver himself may be without assets. I grant that in both England and America, the doctrine of vicarious liability has been pressed too hard. At the same time, I find it outrageous that, in the case just given, I shall not be responsible for accident caused by my employee. And I say that regardless of whether I have been personally negligent in my selection and training of the driver, or in my choice and maintenance of the van. Your idea that ownership does not carry responsibility strikes me as bizarre.
And what applies in the case of a sole proprietor is not changed if I decide to run the company as a joint stock limited liability corporation.
The SK answer is to accept the impropriety of the gun shop example, but to insist that shareholders cannot be regarded as the owners of a corporation. I ask a supplemental question: “So, who owns corporations like British Petroleum?” The answer seems to be not the shareholders.
His answer is not satisfactory. In the first place, he seems to confuse ownership and possession. In the second, he keeps insisting that shareholder cannot be regarded as the owners of a corporation, because their ownership consists solely in the right to elect directors and share in the profits. However, the shareholders of a corporation have the power to change the articles and memorandum of association, so that they were consulted on all management decisions, just as if they were the people of democratic Athens. They have the power to do this. If they do not, that does not make them any the less the owners of the business.
Interesting question from Richard Lynn about the cause of intellectual differences between the races. His answer explains the movement of people from Equatorial Africa to cooler environments, where selection must take place for more intellectually demanding tasks.
Hans-Hermann Hoppe, Concluding Remarks
Thanks all the speakers for their diverse and well-expressed opinions. It is the function of the Property and Freedom Society to provide a forum for controversy. It is a place where libertarians and conservatives of all shades come together to hear opinions and arguments that they might not otherwise do. The PFS seeks to be controversial – and not to hide its quest for controversy in closed meetings, but to advertise it in the full light of day. These speeches will all be made fully available for anyone to watch on the Internet.
Thanks also to his wife and step-daughters and to Jay Baykal.
Next year’s meeting, 18th-23rd September 2014