The U.S. Goverment

[Bodolf]

Great thread, reading it along with my morning coffee-

edited: realized the video I recommended is linked in jorbs sig ^^, may even be where i found it... sleep deprived inter-netting fail.

[pyrale]

for anyone who's interested, (and for those arguing for democracy earlier in thread) take a look at Democracy: The God that failed, on youtube. Is the best argument against democracy Ive heard so far. Talks about how democracy virtually ensures only the worst will ever rise to the top of power (as jorb was mentioning), and how misuse of power is encouraged.

That talk is completely biased : The first thing this guy is pointing out that democracy is more effective than monarchy, and therefore should be dumped because governments should be as ineffective and limited as possible.

There are also some historical nonsenses (like the people being able to prevent their monarchs from raising taxes - best joke ever - or like democratic wars being harsher on civilians, which is complete nonsense when you know that ancient times armies were living on the country during campaigns, but also completely ignores the fact that monarchs also engaged in wars over ideology).

Overall, after listening to this man, I feel like he's been telling many lies and there was no one to point them out to him.

[jorb]

Also, I'm curious to know what exactly do libertarians have over, say, communists. Both have interesting theories, failed attempts and will deny that those attempts nullify their models.

Herp. Derp. That kind of superficial account can of course be given of anyone you disagree with. As a rhetorical device I'm sure it works wonders for you, but as an attempt at actual reasoning it is intellectually dishonest. The fact of the matter is of course that arguing by definition must be an attempt to reason against, and try to explain why, "examples that nullify their models" are in fact not such examples. Calling a theory "interesting" says nothing about it, and asserting that there are "failed attempts" at libertarianism does not mean that that is so (What exactly would those be?).

Furthermore notice a difference in that: The failed communists called themselves communists and openly boasted that they would implement the programs of Marx and Lenin. No libertarian has ever tried to implement "the programs of Mises and Rothbard". Mises and Rothbard both wrote in an era when the ideas of liberty were largely being forgotten. Those who in the past had defended those ideas -- for example Grover Cleveland -- did not consider themselves "libertarians", but merely proponents of liberty quite simply. "Libertarianism" is not some doctrinaire school of thought. It is simply the classical heritage of Smith, Ricardo and Say, combined with newer insights by theoreticians such as von Mises and Murray Rothbard.

Furthermore, history isn't really the place to start unless we have some common understanding of how we are going to interpret the historical data. Could you perhaps explain theoretically the phenomenons of exchange, interest and money?

Good luck.

[pyrale]

That kind of superficial account can of course be given of anyone you disagree with. As a rhetorical device I'm sure it works wonders for you, but as an attempt at actual reasoning it is intellectually dishonest. The fact of the matter is of course that arguing by definition must be an attempt to reason against, and try to explain why, "examples that nullify their models" are in fact not such examples. Calling a theory "interesting" says nothing about it, and asserting that there are "failed attempts" at libertarianism does not mean that that is so (What exactly would those be?).

Although there are bits of trolling in my sentence, it is however true : Current economic libertarians (yeah, I'll separate them from social libertarians) usually base their work on theories. I have no problem with scholars studying (I'm very interested in Von Neumann&Morgenstern's work, and even more in Nash's extension of it) and it may be very interesting. But I'm a bit worried when people start to take those theories, and claiming that they should be applied ASAP because they are logical. Adam Smith's work made sense too, and however interesting it is to study it, his theories about invisible hand are widely criticized and no decent economist would use the wealth of nations as a bible that should be trust verbatim.

So now, what's the link between capitalist and anar-capitalist theories and communism ? In both cases, there are people pushing for them to be applied mindlessly and that simply won't take into account any criticism that is raised against those theories.

Furthermore notice a difference in that: The failed communists called themselves communists and openly boasted that they would implement the programs of Marx and Lenin. No libertarian has ever tried to implement "the programs of Mises and Rothbard". Mises and Rothbard both wrote in an era when the ideas of liberty were largely being forgotten. Those who in the past had defended those ideas -- for example Grover Cleveland -- did not consider themselves "libertarians", but merely proponents of liberty quite simply. "Libertarianism" is not some doctrinaire school of thought. It is simply the classical heritage of Smith, Ricardo and Say, combined with newer insights by theoreticians such as von Mises and Murray Rothbard.

As I said, I have no trouble with people studying economy, trying to build theories and if possible, elaborating ways to test them with as few bad consequences as possible if they fail. I have a big problem with people using these theories and asking for immediate applications because it "makes sense". And when those people

Do you want examples of how a market without regulation fails ? I think 20th century has had enough speculative bubbles generating huge crisis (e.g. '29 bubble, net bubble), new investment mechanisms that were too complicated to be applied and provoked huge crisis (e.g. subprime crisis), companies behaving dangerously (e.g. easy credit) to push people to think twice before listening to libertarians.
You seem to have many economic readings, what about we talk about Stiglitz's work, for instance ?
What about we talk about how games theory proved that making rational choices can be impossible even in a simplified economic context, even knowing that a rational solution exists ?

Furthermore, history isn't really the place to start unless we have some common understanding of how we are going to interpret the historical data. Could you perhaps explain theoretically the phenomenons of exchange, interest and money?

Good luck.

You're kinda making my point : theory, especially in the economic field of "sciences" is nice, but it's not something that I would apply as broadly as some libertarians would like it to, especially when many attempts at deregulating the market gave scary results.

[jorb]

You're kinda making my point : theory, especially in the economic field of "sciences" is nice, but it's not something that I would apply as broadly as some libertarians would like it to, especially when many attempts at deregulating the market gave scary results.

You are indeed making my point entirely. Without some sort of theory you could not make the causal connection between "deregulating the market" and "scary". You operate on a series of assumptions through which you arrange and interpret the historical datums whether you want to or not. The Great Depression was preceded by both "Kaiser Wilhelm letting his famous moustasche droop" and "The establishment of the Federal Reserve and the printing of a shit-ton of monopoly money during the 20's". It is only the application of theory that allows us to conclude that the latter is what caused the Great Depression and not the former, or any other of the thousand historical facts that we could randomly point to. Indeed:

In the field of human history a limitation similar to that which the experimentally tested theories enjoin upon the attempts to interpret and elucidate individual physical, chemical, and physiological events is provided by praxeology. Praxeology is a theoretical and systematic, not a historical, science. Its scope is human action as such, irrespective of all environmental, accidental, and individual circumstances of the concrete acts. Its cognition is purely formal and general without reference to the material content and the particular features of the actual case. It aims at knowledge valid for all instances in which the conditions exactly correspond to those implied in its assumptions and inferences. Its statements and propositions are not derived from experience. They are, like those of logic and mathematics, a priori. They are not subject to verification or falsification on the ground of experience and facts. They are both logically and temporally antecedent to any comprehension of historical facts. They are a necessary requirement of any intellectual grasp of historical events. Without them we should not be able to see in the course of events anything else than kaleidoscopic change and chaotic muddle.

Thus I shall reiterate my question: Can you provide a praxeological account of the phenomenons of exchange, interest and money, or shall you continue to linger in your haphazard maelstrom of kaleidoscopic change and chaotic muddle? Tertium non datur.

[pyrale]

Thus I shall reiterate my question: Can you provide a praxeological account of the phenomenons of exchange, interest and money, or shall you continue to linger in your haphazard maelstrom of kaleidoscopic change and chaotic muddle? Tertium non datur.

No, I wouldn't waste my time with that because I don't think praxeology to be more than mind-fapping.
My theory-validation model was used quite successfuly by scientists for the past century, and it gave pretty good results.

But that sums up our discussion : you want to dump working stuff to use stuff that makes sense instead. Thing is, not everything in our world does make sense.

[jorb]

But that sums up our discussion : you want to dump working stuff to use stuff that makes sense instead. Thing is, not everything in our world does make sense.

"Working"? "Makes sense"? Within the scope of your theory and the laws of logic, you mean?

EDIT: Oh, wait... not everything in our world makes sense?! A is non-A? Is it the laws of logic you are attempting to refute (presumably by using them) or is it merely the human capacity for knowledge you are skeptical about (in which case anything goes)?

[SacreDoom]

This thread is sole TL;DRs...

[pyrale]

...is it merely the human capacity for knowledge you are skeptical about (in which case anything goes)?

This.

We both lack the ability to theoretically grasp correctly models as complicated as the market, and the ability to be rational actors of the market.
Therefore, pure theory about the market is futile (yet interesting).

A funny example of the second point is Ebay's auction system. The auction model used by ebay guarantees that if every other auctioneer is rational, your best possible choice is to place directly the higest bid you can afford on an auction without caring about the time at which you place your bid (you should find explanations in every games theory 101 manual).
In reality, seasoned ebayers use auction snipers (tools that will place your highest bid a couple seconds before the auction actually ends) because the mainstream users of ebay are not rational users.

This fact doesn't prevent games theory to be a very powerful computer science tool. It only shows how a very powerful theory can be useless while used incorrectly.

[jorb]

We both lack the ability to theoretically grasp correctly models as complicated as the market, and the ability to be rational actors of the market.
Therefore, pure theory about the market is futile (yet interesting).

"Pure theory of the market"? "Rational actors"? What are all these theoretical concepts you refer to?

e-BAI!

So? What you are describing isn't "irrational behavior", it is on the contrary quite rational behavior. Since the participants have no idea of what bidding method the other parties will be using, nor for that matter any guarantee that their (or their own) value preferences will remain static for the duration of the auction, they rationally allow the bids to creep upwards with the most intense bidding not seldom taking place near the end of the auction time, when the opportunity cost for not bidding starts to increase. During the time the auction takes place there are a million things that could happen which would change the participants' valuations of the auctioned object, or of the money they plan to exchange for it -- their house might burn down and they might then need the money to rebuild that, they might discover another more interesting object, they might end up in a wheelchair and have no use for the skis that they were attempting to buy. Placing "the highest possible bid" (as if that were a static factor) when the opportunity cost for doing so is at its highest (when there is still plenty of time left) is the direct opposite of rational, economic behavior. But since it doesn't matter: Do you seriously begin your analysis of economic behavior by thinking idly about an entirely trivial auction dilemma?