Monday, August 20, 2007 65 Comments

A landscape of bewildering contradictions

Folks, I have to apologize to anyone who took the rotary system seriously. If you're already in the process of deploying the technology (illegally, of course, since it is my property), I'll have to ask you to stop. As UR's astute comment brigade quickly noticed, the idea is pure satire.

In case it wasn't obvious, the "rotary system" is a corporate rebranding of democracy, specifically the version of it used by the US Federal Government (fondly known as Fedco). "Rotors" are politicians, "stators" are civil servants.

As one commenter wrote: "this would seem to state that our government was already privatized! And what a poor result!"

Precisely.

My point is that Fedco, today, is a corporation. The English word "corporation" just means an organization with a formal name and a legal identity. All nation-states are corporations. The world of 2007 is an anarcho-libertarian paradise - exactly as Peter Leeson describes.

Of course, an orthodox libertarian would not agree. In Murray Rothbard's model, the relationship between Fedco and central North America is nothing like the relationship between Apple and 1 Infinite Loop, because Apple has a chain of title leading back to some grizzled prospector who "mixed his labor" with the great land of Cupertino.

I have not personally investigated Apple's title. So perhaps this is true. As a formalist, though, my theory of property is not ethical, but instrumental. There is an interesting homology between Rawlsian socialists and libertarians: both have a moral calculus which tells them who should own what. I suspect this reflects shared Christian roots.

For a formalist, Fedco owns central North America because it does own it. The description is factual, not normative. Fedco maintains exclusive and unchallenged possession and control. No one on the premises can defy the orders of Fedco's Inspection Council - excuse me, Supreme Court. We are all of us customers in Fedco's big corporate Disneyland.

In fact, given the US's insistence on taxing its citizens wherever they live in the world, one can make a good argument that Americans are not just Fedco's customers, but also its serfs. (The argument fails, though, because Americans can renounce their citizenship.)

This transformation is not a thought-experiment. It's an alternate interpretation of reality. Redefining the US as "Fedco," or the Supreme Court as its "Inspection Council," or its citizens as "customers," does not change the facts at all. Just as chemistry is a special case of physics and biology is a special case of chemistry, a government is a special case of a corporation.

Ergo, no one can construct an ethical system in which this minor rebranding changes the moral valence of actors or actions. If Fedco is evil, the US is evil. If the US is good, Fedco is good. And the same goes for all deeds of all its employees.

What's strange, however, is that this distinction between private and public, corporation and government, which is no more than the difference between a general case and a special case, seems to have a remarkable impact on management techniques. Since biology obeys the laws of chemistry and chemistry obeys the laws of physics, I find this quite unusual.

In my last post I claimed that the rotary system, as described, will result in optimal customer service. Or at least, better customer service than present corporate governance, which gives the customer no voice at all in selecting managers.

Now, this claim is either true, or it ain't.

If it's true, clearly I am the great management guru of all time. Taylor, Deming, Drucker, these men are punks. Two-bit lip-flappers, full of sound and fury, signifying nothing. As the rotary system is adopted, I will conduct packed seminars across corporate America. Hardened regional vice-presidents will break down and cry. Marketing chicks in tight sweaters will whisper suggestively and slip me their room numbers as I autograph their books with broad, confident strokes of the pen.

Unfortunately, if I am this organizational savant, my actual opinion - that the "rotary system" is a hideous and nonsensical disaster, a Kafkaesque monstrosity which I wouldn't wish on my most dangerous competitor - must count for something. So we arrive at the same place.

I think almost anyone who's worked at any sort of corporation, whether it makes software, socks, or sadomasochist sex videos, would agree with me that the rotary system would not improve customer service. Quite the contrary. It would be a bizarre, bureaucratic hell, profoundly ineffective and absurd.

But when we put on our magic citizen glasses, and consider not the rotary system as a form of corporate governance, but democracy as a form of government, we see another reality.

We realize that democracy is in fact the best form of government. (Or, as per Churchill, "the worst, except for all the others" - a very Churchillian way of saying "the best.") That is, democracy provides the best customer service. There is no other way to judge a form of government - surely what matters is what the government does, not who does it or why.

In fact, many Americans feel so strongly about this proposition, and have for many years, that they are willing, even happy and proud, to fight and die while invading other countries to bring them the joys of the rotary system. Excuse me, democracy.

So much for Total Quality Management! Would even "Neutron Jack" himself take a bullet for Six Sigma? Did Taylor drive past IEDs on the way to his time-and-motion studies?

Meanwhile, keeping our magic citizen glasses on, when we look at the perfectly normal, if not uniformly perfect, model of corporate governance that provides excellent customer service in companies large and small, American, Australian and Albanian, makers of software, socks, and sadomasochist sex videos - the model in which the shareholders elect a board, the board chooses a CEO, and the CEO tries to make (and not make up) the quarterly numbers - we notice that this system is, in fact, evil.

More precisely, shareholder governance is a form of oligarchical plutocratic dictatorship. Just as red-blooded Americans have fought for democracy, they have fought against dictatorship. And all parties, left and right, approve. Americans today may quarrel about the war on Iraq, but they agree about the war on Japan, and both wars on Germany.

So when we take the glasses off, we see that evil becomes good. And good becomes, at the very least, ridiculous inefficiency and bureaucracy. Slip the glasses back on and the good is evil again, and inefficiency and bureaucracy are motherhood and apple pie. It is all very confusing! Sometimes I just want to sit in the corner and cry.

If I can pull this back together, however, we have two plausible hypotheses.

Hypothesis A is that the actual business of government is so different from all other industries that it demands a completely different theory of management. The special case is actually special. "Customer-driven positional rotation," while absurd in nonsovereign corporations, is essential in sovereign ones.

Hypothesis B is that "democracy" is just another cult of the state, older, subtler and eventually more successful than its upstart 20th-century competitors. We all believe in it not because it is good and sweet and true, but just because we were brainwashed in third grade. Rotation in office has nothing at all to do with good government, and what we've been worshipping isn't even a golden calf, but an ancient mummified pig, filled with lead and spray-painted yellow.

Both of these strike me as perfectly fair conclusions. And they are certainly mutually exclusive.

Are there any Bayesians in the house? Diligent readers of Overcoming Bias? Here's your chance to overcome some big-time bias. Give me a rational derivation of Pr(A) or Pr(B), and I'll take back everything bad I've ever said about Eliezer Yudkowsky.

65 Comments:

Anonymous Michael said...

States stick around longer than other corporate entities becuase of their size, not tricking people into believing in them.* States have always been large entities, and size lends strength. Just look at how GM has stumbled from year to year for decades now. I can download free and legal versions of all of their software that are better than than the ones they sell, but Microsoft still survives.


*At least not tricking them anymore than Microsoft does.

August 20, 2007 at 11:29 PM  
Anonymous Anonymous said...

Did you read James Buchanan of the public choice theory? He seems quite in your ballpark - and he got Nobel for it.

Additionally, he put all his works online.

As for the merit of the argument - there is a lot of difference between states and corporations. For one thing, states create itself, and corporations are created by states. Corporations cannot survive by itself.

By the way, Adam Smith also wrote about corporations as territorial rulers - there were some examples in his time. He considered them an unmitigated disaster.

Generally, I would repeat the advice given to Lenin - if he claimed to represent scientific socialism, he should have tried it on rats, first.

We cannot DO experiments, but there is no need to. Most kinds of government have been tried already, corporate rulership included. Eg my favourite example of the market anarcholiberalism in practice is Somalia under Islamic Courts.

Since I speak so much of China, I will suggest that this is a good example of the modern corporate state. The Chinese state owns China, and its only aim is to survive, and to get the leadership rich. To do it, it needs to keep the economy growing. It is not exactly pleasant to live there - but it is certainly better than communism.

I only wonder how long it will survive.

Baduin

August 21, 2007 at 12:12 AM  
Anonymous bbroadside said...

I'm still reluctant to put my trust in other systems. I wouldn't quite endorse Hypothesis A though.

For one thing, Fedco is pretty much a monopoly, as natural a monopoly as they get in its primary role - security. States and counties are more like subsidiaries than competitors, would you agree? So we have a human history in which all sorts of local security monopolies have existed.

As you've pointed out, the hereditary oligarchies of the past may have had customer complaints from time to time (e.g. that awful Hungarian who used to bathe in her servants' blood), but they had nothing like the wholesale customer service catastrophes of SovieCo or 3rdReichCo. Didn't the feudal/kingdom companies have trouble turning a big profit though? Didn't they just get outcompeted, more or less?

If the thing you're really worried is your security monopoly deciding that some of its customers need to fired, or some of its employees aren't worth marketing to to (the metaphors are getting muddled!), maybe rotation isn't such a bad thing?

Maybe I'm being a complete demorube (that's a demotist with a sweeter nature and slower wits), but I'm not 100% sure what sort of structure I'd pick. If DC were to fall into the Atlantic, and a private firm were to take over Regional Defense and Policing duties for my area, I may well advocate a corporate structure with some of the features you've satirized. I'm not saying I'm qualified to hire and fire the people with the guns, but I want to be able to hire and fire the people who supervise them. And while I know voting doesn't give me that power, I still do have a modicum of faith in my fellow voters that the worst leaders would be shown the door before they actually start firing (at) their customers/creditors/ whoever.

I'm still not sure the main goal of the reboot. Is it theoretical efficiency? Greater economic growth? An end to the war in Iraq? Are you worried about depression or oppression or something that doesn't end in -pression? Those are generally worthy goals, but it still seems like you've taken the richest, most powerful (militarily, technologically, count Nobel prizes, or international movies, or economically-priced sporting shotguns) and described how its management structure implies that it's really inefficient.

The US just seems like a pretty well-run country to me, domestically. My big objections to the United States are (a) unnecessary violent interventions in foreign lands, (b) judges who legislate from the bench and erode personal freedom. This is (some of) the classic libertarian critique in a nutshell, but I still have to say that the US government model isn't what's broken. The culture (blame, dependency, guilt) is the problem, and that's another thread.

August 21, 2007 at 12:18 AM  
Blogger InspectorDeck said...

Even if Americans renounce their citizenship they can still be taxed by the IRS, especially if it is considered(by who else but the IRS) that renouncing their citizenship was a move to avoid taxes.

August 21, 2007 at 12:20 AM  
Anonymous bbroadside said...

I'm not too happy with my demorube post, because it makes it sound like I'm saying Mencius hasn't explained the purpose of the formalist reboot. He has, in past posts, I'm just trying to get it straight again. Criticisms of the United States from an efficiency standpoint always strike me as a little odd even when they are pretty sophisticated.

Getting to a stable system where liberty doesn't drown in wooly ideals of social justice seems like it requires more of a change in culture rather than government structure. Still, if a progressive-idealist surfs through this site and comes away with a little humility, I guess I'm all for it.

August 21, 2007 at 9:17 AM  
Blogger Michael said...

I actually do have a fair amount to say about this situation from a Bayesian perspective, but without clarified hypotheses it's not possible to really address the question. You haven't given much to go by regarding what you anticipate the results of continued US style democracy to be and what you consider the results of formalism to be.

Even without that I can say that a familiarity with actual quantitative evolution and Bayesian methods makes me VERY skeptical of Burkean conservatism, anthropological functionalism, and the like. Probably both US style democracy and formalism are VERY close, informationally, to maxentropy, if you only consider their evolved components, while the design components were built based on informal theory derived from second hand anecdotes. In other words, they are utter crap compared to what could be invented today if the invention process was permitted to involve some actual social science experimentation.

Bayesian stat also gives me Laplace's Rule of Induction, http://en.wikipedia.org/wiki/Rule_of_succession
which lets me say that if there have been, let's say a hundred revolutions that I could enumerate and none of them made the world better, as I define better, after including transaction costs, the probability of a revolution making things better is 1 in 102. If the number of revolutions that had sane seeming ideas behind them is considered instead, possibly 10 or 20, then the probability is 1 in 12 or 1 in 22.

August 21, 2007 at 9:18 AM  
Anonymous PA said...

if a progressive-idealist surfs through this site and comes away with a little humility, I guess I'm all for it.

This has been UR's best contribution so far: a critique of left liberalism (or Universalism) on its own terms.

August 21, 2007 at 10:27 AM  
Anonymous TGGP said...

Perhaps the rotary system is inefficient, but since the government devotes its energies to fucking us over we WANT it to be inefficient. See Bruce Benson vs Randall Holcombe on contracting out prisons and Eric Crampton on the socialist calculation debate with non-benevolent rulers. I do not commit myself to that view, but I think it is an interesting possibility.

I don't think any of the contributors to Overcoming Bias read your blog, so they aren't going to read this post and your challenge at the end. What you will have to do is get their attention at their blog in order for them to take notice of yours. It is easy for to tell my room-mates that Mike Tyson is a pussy and I will take him on any goddamn day of goddamn week, quite another for me to say that to Tyson himself.

August 21, 2007 at 11:39 AM  
Anonymous anon2 said...

Actually, "the state should be run like a corporation" was very popular with both communists and fascists at the beginning and middle of the 20th century. For starters this philosophy implies no internal markets, since corporations have no internal markets. It also implies that the state owns everything, another idea Moldbug supports. Robert Owen, Friedrich Engels, and many other socialist leaders were factory owners who argued that the state should be run like a factory. Hitler was very big on Henry Ford's methods.

It is this very philosophy, not "demotism", that led to the violence of the 20th century. Moldbug is treading very old and tired ground here, ground that will lead to the opposite of the result he wishes.

August 21, 2007 at 2:10 PM  
Anonymous George Weinberg said...

My point is that Fedco, today, is a corporation. The English word "corporation" just means an organization with a formal name and a legal identity.

While technically true, I think this is misleading in that usually people don't use the word corporation to refer to , for example, nonprofit organizations, even though technically they are. People form organizations for all sorts of reasons, and although in many cases the existence of shareholders getting dividends best serves the purpose of the organization (you might be able to getter better, cheaper food from Trader Joe's than from a co-op), I don't think you can reasonably argue that all organizations should be organized in this way. I think it's very well suited to the supply of goods, fairly well suited to the supply of certain specific services, and much less so where the benefits are more ephemeral. For example, I'm a member of the American Physical Society, but I don't think it's reasonable to call me an "owner" or "customer". My membership is largely about maintaining a connection to the Physics Community, the only tangible benefit I get is a subscription to Physics Today. I imagine organizations that rely on donations or volunteer effort would quickly see those dry up if they had a for-profit structure.

And I think the principle reason why "FedCo" provides such crappy "customer service" is that there's disagreement about what it's supposed to be doing in the first place. The mission statement talks about establishing justice, promoting the general welfare, and so on, but what specifically does that mean? With formalism you solve these problems by defining them away, and that's great if you're just trying to attract libertarian types, but you have to remember what a small minority we are. To you or me, it's a feature that a formalist system almost certainly wouldn't have anything like wealth redistribution or laws to protect the stupid from their own stupidity, but to most people it would be a fatal bug.

I think I'm rambling a bit here. The point is that 1) the argument that the joint-stock model is the most efficient organizational structure really only applies to organizations that can reasonably be represented as providing goods and services at a fee for customers. 2) Many organizations don't really seem to fit this description. 3) Government (as we know it) really doesn't seem to fit this description.

August 21, 2007 at 2:23 PM  
Anonymous bbroadside said...

I don't think Moldbug is saying that government should be run like a corporation, he's saying it is a corporation in many ways, it just has an unstable corporate structure. Also I wouldn't think he regards the US as exceptional. Most modern governments could be described as corporations, with customers, boards, employees, creditors, etc.

I don't think any of this implies that the corporation owns everything in the country. It's not the country that's a corporation, it's the government. (I've avoided the term "state" because I think it is too vague.) It can be a small corporation in charge of a minimum-sized security apparatus, a court system, etc., with tightfisted creditors watching like hawks. Or it could be a huge coop with tons of customers pushing it to provide more and more free services often through increases in debt. That's just my summary.

August 21, 2007 at 2:27 PM  
Anonymous ru said...

anon2,

I believe that MM would confer on citizens the ability to own property, including capital goods, and indeed would like to see even stronger property rights than US citizens currently enjoy, which of course is the opposite of the communist system.

August 21, 2007 at 5:15 PM  
Blogger Mencius Moldbug said...

Perhaps the rotary system is inefficient, but since the government devotes its energies to fucking us over we WANT it to be inefficient.

I suspect a lot of people believe in the rotary system for exactly this reason. But it's very, very wrong.

An inefficient government is precisely one that devotes its energies to "fucking us over." There is a very large difference between this and what an efficient government does, which is maximizing return on capital.

Obviously, the phrase "fuck over" is not well-defined, but if you think of all the myriad ways the 20th-century state has fucked people over, I think you'll see how few of them have anything to do with maximizing return, and in fact how many are its direct opposite.

The reason I don't read the Bayesians is that I don't find most of their discussions interesting. This is disappointing, because I too consider myself dedicated to "overcoming bias," but obviously I don't mean this in the technical Bayesian sense.

August 22, 2007 at 9:49 AM  
Blogger Mencius Moldbug said...

Actually, "the state should be run like a corporation" was very popular with both communists and fascists at the beginning and middle of the 20th century. For starters this philosophy implies no internal markets, since corporations have no internal markets. It also implies that the state owns everything, another idea Moldbug supports. Robert Owen, Friedrich Engels, and many other socialist leaders were factory owners who argued that the state should be run like a factory. Hitler was very big on Henry Ford's methods.

This is all true, except that these people were criminals, fanatics or fools. And sometimes all three.

The bad link in this syllogism is the equation of "business" and "factory." Running a state as a business is not the same as running a state as a factory.

Of course the difference is that in a factory, almost every action of almost every employee is centrally planned. And everyone on the premises is an employee. Pretty much everyone in the first half of the 20th century believed in this analogy - not just the fascists.

When your business is in fact a large real-estate development, of course, effective processes and procedures have nothing at all to do with those that are effective for a factory. The fact that this analogy could even be suggested shows how far from reality thinkers like the ones you mention had wandered.

If centrally-planned economies were more prosperous than free ones, communism would certainly have outcompeted capitalism. Since they are not more prosperous, there is no way for them to be more profitable, and thus no reason to think a state run as a business would try to adopt them.

August 22, 2007 at 10:01 AM  
Blogger Mencius Moldbug said...

george,

A very insightful comment, as usual.

I think I'm rambling a bit here. The point is that 1) the argument that the joint-stock model is the most efficient organizational structure really only applies to organizations that can reasonably be represented as providing goods and services at a fee for customers. 2) Many organizations don't really seem to fit this description. 3) Government (as we know it) really doesn't seem to fit this description.

As for 1 and 2, the relationship between the joint-stock design and nonprofits/charities is quite interesting - I will cover it soon.

3 is even more interesting. Because this is the usual paradigm that people accept: the state as a fundamentally eleemosynary or philanthropic institution.

Why doesn't this work? How is America not like the American Physical Society?

There are two basic differences. One, the APS does not control a continent - or, in fact, any pool of capital. No capital = no capitalism.

Two, if the APS did control a pool capital (as many nonprofits, eg foundations, do), it also has an enforcing agency, the US, that compels it to act in accordance with its charter.

Obviously, for a sovereign state, there is no such enforcer.

The result is an inherently unstable situation. As economists put it, it's a 20-dollar bill lying on the sidewalk.

It is easy to design a minimal state whose role is simply to provide security for its inhabitants, and which does not try to maximize its revenue. The trouble is that its employees will find a way to turn it into one which does maximize its revenue, and no one, by definition, can stop them.

Thus the tendency of the eleemosynary state to expand indefinitely, using the device of patronage in which employees are effectively shareholders. At the start it is better than the joint-stock state, but it very quickly becomes worse.

August 22, 2007 at 10:21 AM  
Blogger Mencius Moldbug said...

As you've pointed out, the hereditary oligarchies of the past may have had customer complaints from time to time (e.g. that awful Hungarian who used to bathe in her servants' blood), but they had nothing like the wholesale customer service catastrophes of SovieCo or 3rdReichCo. Didn't the feudal/kingdom companies have trouble turning a big profit though? Didn't they just get outcompeted, more or less?

No, they were defeated militarily - by revolution and war. There's quite a big difference. HapsburgCo, for example, was a very pleasant place to live and doing just fine, in an economic sense.

The US just seems like a pretty well-run country to me, domestically.

The trouble is that we don't have a basis for comparison.

If everything west of the Elbe had somehow magically disappeared in 1950, East Germany would have seemed like a pretty well-run country, too. It was certainly the best-run country in the Warsaw Pact.

It is not really true that if you put a frog in a pot and warm the water slowly, you can boil it without the frog jumping out. But it works much better with people.

For example, between 1900 and 1992, crime rates in the UK increased by a factor of 47. Not 47% - 4700%. (Source.) Also, the British Empire was demolished, most of British industry disappeared, and the moral habits of the lower classes became positively barbaric.

If the British of 1900 could see these results, they would instantly and almost unanimously identify them as disastrous, and they would see them as the consequence of Americanization.

But the British of 2007, of course, don't see it this way at all.

August 22, 2007 at 10:40 AM  
Blogger Mencius Moldbug said...

Even if Americans renounce their citizenship they can still be taxed by the IRS, especially if it is considered(by who else but the IRS) that renouncing their citizenship was a move to avoid taxes.

True, but they can't be taxed on income they earn after they renounced. There is some limit!

August 22, 2007 at 10:42 AM  
Blogger Mencius Moldbug said...

Since I speak so much of China, I will suggest that this is a good example of the modern corporate state. The Chinese state owns China, and its only aim is to survive, and to get the leadership rich. To do it, it needs to keep the economy growing. It is not exactly pleasant to live there - but it is certainly better than communism.

Sure. It's also better than democracy, I'd argue - certainly in the context of China.

The trouble with China is that it's an oligarchy, not a joint-stock country, and as such its power structure is exceedingly informal. Don't expect it to be very good at making effective high-level decisions.

Also, one of the major unrecognized ingredients in China's success is the amount of decentralization in its present structure - local authority figures have a lot of independence. China as a whole is not especially neocameralist, but regions such as the Pearl River Delta come very close to operating in a businesslike fashion. Unfortunately, this autonomy seems to be decreasing.

August 22, 2007 at 10:59 AM  
Anonymous TGGP said...

An inefficient government is precisely one that devotes its energies to "fucking us over."
An efficient pirate is one that devotes its energies to fucking people over. If we believe it is unavoidably the case that we are governed by roving bandits, we will want them to be incompetent bandits we can easily evade. That's not a first best solution, but there's a reason why Eric Crampton's post contains the phrase "second-best". Perhaps Sailer is also right in that third-world dictators often have accurate beliefs about the potential of their subjects. I am not saying I believe any of these, just that I'd like to see a better debunking from you.

This is disappointing, because I too consider myself dedicated to "overcoming bias," but obviously I don't mean this in the technical Bayesian sense.
Than what do you mean by it? If you don't define your terms well enough to induce understanding they are just passwords.

This is all true, except that these people were criminals, fanatics or fools. And sometimes all three.
And communism would work if only the right people were in charge...

It is not really true that if you put a frog in a pot and warm the water slowly, you can boil it without the frog jumping out. But it works much better with people.
That seems doubtful, humans have higher IQs and IQ is correlated with avoiding stupid deaths. I know this is pedantic, but I couldn't resist.

Also, the British Empire was demolished
If it was just a waste of money subsidizing vanity, I don't see what's so bad about that. Other than for the inhabitants of the colonies, but screw those wogs.

most of British industry disappeared
Agriculture started dying off when industry started up. Now finance and the service economy rule the day.

the moral habits of the lower classes became positively barbaric.
Are they reading that awful rock and roll music while reading comic books? You got a point with the crime thing, but old fogeys always talk about a decline in morality even if there isn't really a problem.

August 22, 2007 at 11:22 AM  
Blogger Mencius Moldbug said...

Are they reading that awful rock and roll music while reading comic books?

Not exactly.

If we believe it is unavoidably the case that we are governed by roving bandits, we will want them to be incompetent bandits we can easily evade.

We're governed by stationary bandits, not roving ones. See my response to George above - benign incompetence, while it may exist, is not stable. And harmful incompetence is quite common.

Than what do you mean by it?

I mean that our mental environment is full of unquestioned or poorly-questioned received truths. Many of these are almost certainly quite delusional. At least, when we look at past societies, we see extraordinary levels of systematic delusion (such as the divine right of kings).

August 22, 2007 at 11:36 AM  
Blogger Mencius Moldbug said...

Bayesian stat also gives me Laplace's Rule of Induction, http://en.wikipedia.org/wiki/Rule_of_succession
which lets me say that if there have been, let's say a hundred revolutions that I could enumerate and none of them made the world better, as I define better, after including transaction costs, the probability of a revolution making things better is 1 in 102. If the number of revolutions that had sane seeming ideas behind them is considered instead, possibly 10 or 20, then the probability is 1 in 12 or 1 in 22.


This is such a fine example of Bayesian urns-and-balls thinking that it ought to be pulled out and framed.

Bayes' rule is an excellent way to think when you're pulling balls out of opaque urns. But if the urn is transparent, Bayesian thinking becomes idiotic.

And this is how Bayesianism joins the revolt against reason. It says: don't try to see through the urn. Don't think deductively about what a revolution is, or how cause and effect in economic, political and military affairs works. Just look at the numbers and compute how likely the ball is to be red.

In almost all real-world problems, events are highly correlated and display extensive causal structure. By treating them as balls in urns, you reduce your power of thought. Hence the revolt against reason.

August 22, 2007 at 11:44 AM  
Anonymous bbroadside said...

Mencius wrote a typically thoughtful reply: "No, they were defeated militarily - by revolution and war. There's quite a big difference. HapsburgCo, for example, was a very pleasant place to live and doing just fine, in an economic sense."

Hmm, well World War I is tough because the most modern states tended to fight one another in one region (Flanders) and the more traditional ones had another region (basically, the Baltic to Mesopotamia). My contention is that modernity was key to winning that war, and that it is more or less the same kind of modernization that makes a company competitive. The Austrians were modern in some ways; they had an excellent weapons plant in a region dominated by Czechs.

Is there some echo of the Thirty Years' War in the fact that the protestant regions of Europe tended to be so much better armed and organized than the Catholic and Orthodox regions (who were better armed than the Muslim regions)? I'm on shaky ground here, but I think Prussia was majority Protestant in 1914 (and, perhaps more importantly in 1871). Ditto for Britain. These two countries just seem incomparably more professional than their foes, and they carried better weapons. Russia, AH, and Italy were less well-prepared, brave as they were. France was sort of in-between (which fits, I suppose, as a historically Catholic country on the Protestant side in the 30 Years' War). The Balkan states seem to have been

I know I'm not doing this topic justice. I think what you're getting at is that Protestant / universalist states have an unsound business model which makes them inefficient. I just can't tell when you're using the definition of "efficient" I'm most familiar with (efficiency means being able to build an aviation industry on a small Atlantic island from nothing to militarily significant in less than 20 years), or if we're dealing with something more subtle (efficiency means not screwing your customers because you have no incentive to do so).

"The trouble is that we don't have a basis for comparison.

If everything west of the Elbe had somehow magically disappeared in 1950, East Germany would have seemed like a pretty well-run country, too. It was certainly the best-run country in the Warsaw Pact."

A fair point. Germany seems like the most formidable example of whatever form of government it happens to be in at the time. They have an efficiency culture.

"For example, between 1900 and 1992, crime rates in the UK increased by a factor of 47. Not 47% - 4700%. (Source.) Also, the British Empire was demolished, most of British industry disappeared, and the moral habits of the lower classes became positively barbaric."

This point should not be overlooked. Progressive-idealism has a lot to answer for in terms of crime rates.

"If the British of 1900 could see these results, they would instantly and almost unanimously identify them as disastrous, and they would see them as the consequence of Americanization."

Oh, I was with you until the last point. I'd have thought you'd say "... the consequence of Fabianism, Marxism, etc." If your thesis about Protestant reformism inspiring progress is correct, it sounds like Britain is the source of a lot of these ideas. I'm not sure if by Americanization, these crystal-gazing Britons of 1900 are thinking about cowboys or Woodrow Wilson.

"But the British of 2007, of course, don't see it this way at all."

I'm sure they'll see it that way if they read this site. (Mostly kidding, but not entirely.)

August 22, 2007 at 12:08 PM  
Anonymous bbroadside said...

Oops, looks like my literary ADD got the better of me.

"The Balkan states seem to have been"
... most formidable when they were consciously imitating Prussified Germany (or perhaps the UK, although I don't have any concrete examples of that).

August 22, 2007 at 12:14 PM  
Blogger brendon said...

"For example, between 1900 and 1992, crime rates in the UK increased by a factor of 47. Not 47% - 4700%. (Source.) Also, the British Empire was demolished, most of British industry disappeared, and the moral habits of the lower classes became positively barbaric."

i'm second to no man in hating the rather pansy, overly lenient 'universalist' approach to crime (i live in brooklyn right across the street from some housing projects, so this is not entirely academic) but this is a bad statistic. the bureaucrat who wrote the piece seemed to think the increase in crime rates could be at least partly explained by increases in crime reporting. more interesting, perhaps, is the change in homicide rates, as for obvious reasons these have probably the highest reporting rates. murders rose from around 9 per million in 1900 to 14.5 per million in 1995 and were at their lowest -- around 6/million -- in the fifties. halcyon days!

i realize this is beside the larger point, but just thought i would help...

August 22, 2007 at 1:26 PM  
Anonymous George Weinberg said...

Another point that I don't think has been sufficiently addressed:

In Murray Rothbard's model, the relationship between Fedco and central North America is nothing like the relationship between Apple and 1 Infinite Loop, because Apple has a chain of title leading back to some grizzled prospector who "mixed his labor" with the great land of Cupertino.

I've never really fully bought into this concept of property ownership that the first person to profitably use a piece of land becomes the absolute owner, since: 1) there's a finite amount of undeveloped land, and I don't see why the first come should be able to grab as much as he likes; 2) I think there's a good case for leaving at least some land in its state of nature, for example I would prefer to see Kodiak Island to the bears; and 3) much of the earth was originally settled long ago, and has been forcefully expropriated many times, so identify the "rightful owner" in this sense is an exercise in futility.

But that being said, I think it's one thing to sweep ancient theft and plunder if it happened centuries ago and the current owner's claims rest on a long chain of voluntary transactions, and something rather different if the current "owners" are the original thieves, particularly if the victims are still alive.

I could see the pragmatic appeal to accepting current claims of ownership as being valid in order to avoid future conflict if everybody else were willing to accept the also, but the fact is that many are not, nor is there any reason they should be. It's true as far as it goes that if there ever is a time when people decide to accept control = ownership as of a certain time, the only time they could have a decent chance of agreeing on is "right now" as of the time the agreement is reached. But it's also true that as long as this idea is just being bounced around and isn't yet a concrete proposal, there will be some joker who will say, "I like this idea in principle, but before I sit down at the table there's a little something I have to take care of first if you know what I mean, and I think you do".

I know we've been through this before, but I haven't really been satisfied by your answers. It seems to me that you're saying that 1) we should accept the fact that FedCo (that is, the civil service) owns the USA because they de facto control it, moral claims of ownership are irrelevant. 2) this control requires the support of the "red state" government, that is, the military and 3) the civil service and military largely hate each other. It seems to me that there's a contradiction here, that "FedCo"'s de facto control is entirely contingent on "RedCo" accepting that they have a moral claim to control. If "RedCo" were to abandon morality and assert "control = ownership", it seems to me much more plausible that they'd call themselves the new owners. What would they need FedCo for?

A military coup sounds like the most plausible way for a formalist regime to come about, but they never yet have had that result. Maybe we need to talk about Chile.

August 22, 2007 at 4:29 PM  
Blogger mtraven said...

MM said: And this is how Bayesianism joins the revolt against reason. It says: don't try to see through the urn. Don't think deductively about what a revolution is, or how cause and effect in economic, political and military affairs works. Just look at the numbers and compute how likely the ball is to be red.

I think this is being somewhat unfair to the Bayesians, who actually have very good methods for thinking about causality and modelling situations where there are knowns (transparent urns) combined with unknowns.

This makes Bayesian techniques excellent for domains like medical diagnosis, where there is noisy data and partial models. But it's still pretty useless for social and political questions, where you can't even get meaningful statistical data. There are enough mostly-identical human bodies that you can find correlations -- there aren't enough mostly-identical societies, which all differ from each other along multiple dimensions and those dimensions can't even be determined in an ideology-free fashion.

August 22, 2007 at 7:59 PM  
Blogger Daniel A. Nagy said...

Just some semantic hairsplitting:

Why do you all call the regimes run by communists "communism"?
Communism for the adherents of the communist religion (itself an atheistic branch of Christianity) is the name of paradise (on Earth).

These regimes never referred to themselves as "communism". The following terms were used: "people's democracy", "socialism", "advanced socialism" (this is Brezhnev's term used exclusively for the USSR on his watch), "people's republic", "soviet system" (properly translated as "council system"), "soviet republic" ("councils' republic").

Would you call the social-political arrangement of the Islamic Republic of Iran "heaven"?

August 23, 2007 at 3:58 AM  
Anonymous TGGP said...

And this is how Bayesianism joins the revolt against reason. It says: don't try to see through the urn. Don't think deductively about what a revolution is, or how cause and effect in economic, political and military affairs works. Just look at the numbers and compute how likely the ball is to be red.
Show me one example of any Bayesian saying anything like that. You can use all your hedgehog-like powers of deduction and grand theories to come up with subjective priors, but you'd better update properly when new information comes in.

Why do you all call the regimes run by communists "communism"?
Whatever they called their countries, the parties generally called "the communist party" and as far as I'm concerned, communism is as communism does. The United States may not be 100% laissez faire or direct Athenian style democracy, but it's worthwhile to refer to it as a "capitalist democracy".

August 23, 2007 at 10:08 AM  
Anonymous anon2 said...

"I believe that MM would confer on citizens the ability to own property, including capital goods, and indeed would like to see even stronger property rights than US citizens currently enjoy, which of course is the opposite of the communist system."

This is very naive. MM is an admitted Brahmin who is openly promoting greater and more secure power for Brahmins, all dressed in a silly pseudomarket costume. In fact he's talked quite openly about his desires to maximize tax revenue, impose martial law, nationalize utilities, and a number of other proposals right out of the Reform-Jingo playbooks and the Communist Manifesto. MM believes in strong property rights for the owners of a powerful state -- which means none for anybody else.

August 23, 2007 at 1:37 PM  
Anonymous anon2 said...

This is all true, except that these people were criminals, fanatics or fools. And sometimes all three.

As opposed to whom?

Of course the difference is that in a factory, almost every action of almost every employee is centrally planned.

As opposed to say Walmart, where each manager owns a store and the checkout clerks trade every day in shares of Smiley Special derivatives? What planet are you living on? Corporations do not have internal markets and internal property rights any more today than they did at the time of Friedrich Engels and Robert Owen.

August 23, 2007 at 1:51 PM  
Blogger Mencius Moldbug said...

anon2,

Corporations do not have internal markets and internal property rights any more today than they did at the time of Friedrich Engels and Robert Owen.

And in 1770 everyone in Europe was ruled by a king. This did not make democracy impossible. Except in the eyes of those for whom the status quo was the beginning and end of the possible.

Entrepreneurial enterprises respond to reality. The reality is that central planning doesn't work. Of course, if you disagree with this reality, I can see where you're coming from.

August 23, 2007 at 10:03 PM  
Blogger Mencius Moldbug said...

bbroadside,

If your thesis about Protestant reformism inspiring progress is correct, it sounds like Britain is the source of a lot of these ideas. I'm not sure if by Americanization, these crystal-gazing Britons of 1900 are thinking about cowboys or Woodrow Wilson.

The ideas went to America with the Puritans and came back with Wilson.

Most of the Optimate ruling class of Victorian England rooted for the South in the Civil War, because they saw the North as a bunch of violent religious fanatics. And the victory of the North indeed gave an impetus to Fabian nationalism, whose roots were in the Dissenter/Nonconformist sects which sided with the Yankees.

Is there some echo of the Thirty Years' War in the fact that the protestant regions of Europe tended to be so much better armed and organized than the Catholic and Orthodox regions (who were better armed than the Muslim regions)?

I'd say the Protestant regions did better because they were a little more in tune with capitalism. The clericalist reactionary elements in the Catholic states tended to be a little clamped down from this perspective. Of course the Protestant mainstream has moved on and now thinks of capitalism as the devil, but it had its day.

August 23, 2007 at 10:11 PM  
Blogger Mencius Moldbug said...

i'm second to no man in hating the rather pansy, overly lenient 'universalist' approach to crime (i live in brooklyn right across the street from some housing projects, so this is not entirely academic) but this is a bad statistic. the bureaucrat who wrote the piece seemed to think the increase in crime rates could be at least partly explained by increases in crime reporting.

Indeed, but that doesn't make him right. There's certainly a motivation for the claim! And the England of 1900 was not particularly tolerant of crime. Look at the figures for prison population - much less disproportionate. There's a reason for this.

And I'm pretty sure the falloff since 1992 has a good bit to do with falls in reporting. Apparently the police in Britain these days work pretty hard to keep their stats down.

August 23, 2007 at 10:15 PM  
Blogger Mencius Moldbug said...

This is very naive. MM is an admitted Brahmin who is openly promoting greater and more secure power for Brahmins, all dressed in a silly pseudomarket costume.

anon2, I'm glad someone's figured out my real plans! I will stop at nothing but the extermination of the white race. Actually I've just been finishing up my autobiography, My Struggle: The Protocols of the Elders of Moldbug. I'm sure it will catapult me to global domination.

August 23, 2007 at 10:20 PM  
Blogger Mencius Moldbug said...

tggp and mtraven,

Show me one example of any Bayesian saying anything like that.

It's not what they say, it's what they do. No one with only a hammer will ever tell you that everything is a nail. But when you see them pounding away at screws you notice.

I think this is being somewhat unfair to the Bayesians, who actually have very good methods for thinking about causality and modelling situations where there are knowns (transparent urns) combined with unknowns.

"Transparent urns" was a bad way to express what I was thinking, which is that sometimes deduction can help you figure out what's in the urn.

This makes Bayesian techniques excellent for domains like medical diagnosis, where there is noisy data and partial models. But it's still pretty useless for social and political questions, where you can't even get meaningful statistical data. There are enough mostly-identical human bodies that you can find correlations -- there aren't enough mostly-identical societies, which all differ from each other along multiple dimensions and those dimensions can't even be determined in an ideology-free fashion.

100% agreed.

August 23, 2007 at 10:25 PM  
Blogger Mencius Moldbug said...

These regimes never referred to themselves as "communism". The following terms were used: "people's democracy", "socialism", "advanced socialism" (this is Brezhnev's term used exclusively for the USSR on his watch), "people's republic", "soviet system" (properly translated as "council system"), "soviet republic" ("councils' republic").

This is an excellent point. What do you prefer? I kind of like "people's democracy," for obvious reasons.

Also, isn't "committee" just as good a translation of "soviet?" Certainly the Universalists are fond of their committees as well...

August 23, 2007 at 10:27 PM  
Blogger Mencius Moldbug said...

George,

But that being said, I think it's one thing to sweep ancient theft and plunder if it happened centuries ago and the current owner's claims rest on a long chain of voluntary transactions, and something rather different if the current "owners" are the original thieves, particularly if the victims are still alive.

Definitely. This has to be a judgment call. No general solution is possible. There is no boolean distinction between the cases. And the call has to be made once - when the system is being rebooted, and legality is being reestablished.

I know we've been through this before, but I haven't really been satisfied by your answers. It seems to me that you're saying that 1) we should accept the fact that FedCo (that is, the civil service) owns the USA because they de facto control it, moral claims of ownership are irrelevant. 2) this control requires the support of the "red state" government, that is, the military and 3) the civil service and military largely hate each other. It seems to me that there's a contradiction here, that "FedCo"'s de facto control is entirely contingent on "RedCo" accepting that they have a moral claim to control. If "RedCo" were to abandon morality and assert "control = ownership", it seems to me much more plausible that they'd call themselves the new owners. What would they need FedCo for?

They wouldn't.

The reason I talk in terms of formalizing FedCo, rather than removing it, is that I want to stress that the idea of taking the existing power structure and making it official as a property right, in principle, can happen without anything resembling violence or a breach in legality.

In practice, however, a military coup is certainly one way to get there. I have a lot of respect for the US military, and I think they could do an excellent job of running a transitional government.

But I guess what I'm saying is that the ownership structure of a formalized state depends on the actual power structure at the time of formalization. Since at present this is an almost unimaginable fantasy - whether it is to be enacted by RedCo, BlueCo, or both together - I prefer to just describe it in terms of the least disruptive possible path, without speculating on which paths are more or less likely to actually happen.

August 23, 2007 at 10:35 PM  
Anonymous bbroadside said...

(MM has already poked fun at this but I though it needed a straight-forward reply, partly because it makes me so curious.)
anon2 wrote: "MM is an admitted Brahmin who is openly promoting greater and more secure power for Brahmins ..."

MM is an admitted Brahmin who sounds to me like a textbook apostate. He sympathizes openly with Vaisyas and pines the near-extinction of the Optimates. Formalizing the state seems to me to turn all the Brahmins into Vaisyas whether they like it or not. Their business would be an enormous national security firm which would pay its owners. Am I wrong in this?

"... all dressed in a silly pseudomarket costume. In fact he's talked quite openly about his desires to maximize tax revenue,"

This doesn't seem that strange. Revenue-maximizing tax rates tend to be pretty moderate in countries with low exit costs, which if I'm not mistaken tend to be most admired here at UR.

"... impose martial law,"

Not following you here. I haven't read everything at this site, but I've read most things. Help me out.

"... nationalize utilities,"

Ditto.

"... and a number of other proposals right out of the Reform-Jingo playbooks and the Communist Manifesto."

I don't even know what "Reform-Jingo" means. Progressive nationalism? Sounds spooky. Communist Manifesto is a strange one too, it seems like the least formalist, most anti-propertarian thing around, at least among works of that stature. MM likes libertarians ... some libertarians were inspired by Proudhon ... Proudhon presumably inspired Marx.... Is that what you're getting at?

"... MM believes in strong property rights for the owners of a powerful state -- which means none for anybody else."

I've wondered about this too. It certainly doesn't seem very "Communist Manifesto". His description of the owners of said state is intended to be purely descriptive; he's basically talking about paying dividends to early-retired civil servants as if they were big blue-chip investors. Maybe I am naive, but I really don't see that as straight out of anybody's playbook.

Anyway, that's me being me, I guess. I like UR a lot but I'm always wanting things to be rephrased so passersby (and I) won't get confused. Which is odd, because MM and I have something of a similar intellectual background, so it seems like I should be pretty well suited to the version 1.0, but whatever.

August 23, 2007 at 10:54 PM  
Anonymous TGGP said...

But when you see them pounding away at screws you notice.
Then show me some of them pounding on screws with a hammer. By the way, this reminds me of an excellent Perry Bible Fellowship cartoon.

I have a lot of respect for the US military, and I think they could do an excellent job of running a transitional government.
I don't think so. Kosovo is the closest thing to a recent success in that department. Maybe you've confused this U.S military with a previous one.

August 24, 2007 at 4:21 PM  
Anonymous anon2 said...

(MM has already poked fun at this but I though it needed a straight-forward reply, partly because it makes me so curious.)

MM's response was clever -- admit the accusation, because the truth of the accusation is not easy to refute, but then pretend that the admission is a joke by comparing the accusation to some whacko conspiracy theory. When all other argument fails, call 'em crazy.

But how are my accusations any more of a whacko conspiracy theory than the whole Brahmin/Vaisya/etc. spiel, the hidden meanings of the 1932 Democratic Convention's betrayal of the libertarians, the "real" power structure of the United States (all power is already controlled by MM's Brahmin friends, and resistance is futile), and on and on!?!

MM is an admitted Brahmin who sounds to me like a textbook apostate. He sympathizes openly with Vaisyas and pines the near-extinction of the Optimates.

Of course he wants us to believe he's an apostate, because he's trying to sell his ideas to libertarian Vaisyas, and pining for Optimates is harmless. Alternatively, he may just be deluding himself into believing he's a Vaisya while keeping all the basic Brahmin beliefs, including the self-serving ones. But if he is an apostate why is he so strongly advocating in favor of turning the Brahmins' lifeblood, their tax revenue stream, into an irrevocably secure property right, a property right which justifies any and all measures including martial law to secure it? I'd sure love for my friends or a member of my class to betray me like that! A true betrayer of the Brahmins and defender of the Vaisyas would want to hit the Brahmins where they can be hurt most, that is in the pocketbook. He certainly would not advocate, as MM does, that the political powers of Brahmins be upgraded to property rights and be protected with unprecedented security.

[I had written that MM has promoted martial law and nationalization of utilities; MM is playing out of the Reform-Jingo playbook that he criticizes].

Not following you here. I haven't read everything at this site, but I've read most things. Help me out.


It's all there in his writings, a guarantee you. Try googling the phrases. Also, observe that MM is not denying any of these, although I look forward to seeing what shucking and jiving that brain of his will cook up next. I have learned many interesting things about rhetoric from reading him.

Communist Manifesto is a strange one too, it seems like the least formalist, most anti-propertarian thing around

Communism, co-developed by factory owner Friedrich Engels, and MM's ideal of managing the state like a corporation manages a business enterprise are at their core the same thing. Communism is propertarian in the same way Moldbug is propertarian -- all property of importance belongs to the state, just as most of the property of any importance used by a corporation belongs to the corporation. They are both top-down hierarchical organizations. Modelling the state on the corporate hierarchy leads straight to socialism.

MM, with Marx and Engels and the fascists alike, preys upon the tendency of people to try to understand society to lump very diverse people into simplistic classes, and the admiration of many for the corporate hierarchy as a superior form of organization and the associated economic ignorance of most people of the bigger picture.

Possibly I am imputing dishonesty where I merely should be imputing ignorance. Moldbug himself may have been preyed upon by the memes of his Brahmin cohorts and is merely propagating the self-serving falsehoods of others. If so, I profusely apologize for suggesting that he is purposefully and cleverly dishonest.

Too bad for MM's quest that this siren spiel is much easier to detect and rebut on the Internet than if it was just force-fed through the mass media as in the good old days.

August 24, 2007 at 5:02 PM  
Anonymous anon2 said...

Communism is propertarian in the same way Moldbug is propertarian -- all property of importance belongs to the state.

I should add that the fantasy of communism as abolishing property does not in any way detract from the accuracy of this statement. Communist leaders only desired to abolish, and communist systems only succeeded in abolishing most private property, just as MM seeks to abolish any private source of power in order to secure the all-powerful state. In MM's Brahmin state private property and markets are allowed to Vaisyas only to the extent they facilitate tax collection, just as in slavery food and rest only existed to the extent they maximized the slave's output. Nationalization of utilities, martial law, and anything else necessary to the maximize the ability of Brahmins to extort the value produced by Vaisyas are always on the table.

Oh, I forgot, "value" doesn't exist, only "price", so the Brahmins aren't actually stealing anything from the Vaisyas. They are merely charging a "price", a service fee for doing, by admission and design, nothing at all for the Vaisyas. But that's still a perfectly good market price in MM's twisted version of Austrian economics. Excuse me.

BTW, to martial law and the nationalization of utilities let's add MM's recent proposal to abolish freedom of speech and all other politic rights in order to further secure the rule of the Brahmins. Freedom to speak as I am speaking now could be very dangerous to the security of the Brahmins and their tax revenue, unless MM and his Brahmins can keeping coming up with more sufficiently witty claims about how what crazy conspiracy filled nuts we mere Vaisyas are to say things like this.

August 24, 2007 at 5:45 PM  
Anonymous bbroadside said...

anon2 wrote: "In MM's Brahmin state private property and markets are allowed to Vaisyas only to the extent they facilitate tax collection, just as in slavery food and rest only existed to the extent they maximized the slave's output."

It sounds draconian when you put it in those terms, but MM isn't trying to prescribe. He's trying to describe the post-New Deal federal government. Price controls have largely been abandoned, not because the government has become more humble and less interventionist, but because they were viewed as inefficient. The Federal Reserve's control of the money supply hasn't been abandoned because a general consensus among monetarists, neo-Keynesians, etc., says it maximizes economic growth.

Those both represent huge increases in Federal power since 1920 (when the the government was more powerful than it was in 1850, etc.) Resistance to increases in government scope have been overcome usually by arguments about maximizing growth. When Reagan sought to cut tax rates his (Laffer's) argument was it would increase revenue. The argument that the state should just shrink wouldn't fly even during the Reagan Revolution ... there had to be a crypto-Keynesian "conservative" justification.

What sounds like MM's ambition to you sounds like resignation to me. People have been making small government arguments for at least a century before the word "libertarian" came into currency. The arguments may be correct but they're not exactly winning. Marijuana is illegal and social security is public, and mandatory. So, the libertarians and their allies have their work cut out for them.

In the meantime, I think a formalist critique is extremely useful. The American caste system idea is original and provocative. The separation of security and information propagation idea is not to be ignored. I don't support the formalist reboot but it's constructed on an idea that can't be written off as fascism / communism in yet another disguise. Seriously now, I'm starting to roll my eyes a little at every proposed system (except fascism) being described as "fascism in a clever disguise: and every one (except communism) being described as "communism in a clever disguise". I just think critiques would be harder-hitting if they would cut to the chase.

Does the formalist reboot transfer power in a direction you don't like? If it does, that's odd, because it's not supposed to transfer power at all. The ruling class already has the power to make us believe absurdities (like affirmative action is the solution to racism and our nation-building efforts in Iraq will eradicate al-Qaeda), so what exactly can't they do? Declare martial law nationwide? I hope they can't but I wouldn't bet on it. Anything that rattle the complacent progressive-idealist cage is fine by me.

August 24, 2007 at 10:27 PM  
Anonymous TGGP said...

Is free speech a political right? I thought it was a social/civil freedom. Milton Friedman discusses the three kinds here and the Friesian Institute has a three-axis graph here. I think Mencius has claimed that once our interests are aligned through formalism, the Vast and Pungent Fnargl will not restrict our freedoms.

August 25, 2007 at 9:15 AM  
Anonymous Anonymous said...

Clever stuff! But "The world of 2007 is an anarcho-libertarian paradise"...not hardly.

The basic starting principle for anarchism/libertarianism is "no initiation of force." Eg., no taxation. If some organization wants my money, they have to convince me to voluntarily sign a contract saying I will give it to them.

And no, the "social contract" doesn't count.

August 25, 2007 at 3:22 PM  
Anonymous anon2 said...

The ruling class already has the power to make us believe absurdities.

By logical deduction from and in the style of MM's own conspiracy theories, this is just what the Brahmins would like us to believe, that they are in total control. They know we are going to slowly learn about how we were defrauded of our freedoms, but they want to us to believe that resistance is futile. Even though the Internet allows us to bypass the Brahmin mass media in order to discover the Brahmin frauds, Brahmins have another fraudulent theory to deter this threat, namely the theory that it's too late for we Vaisyas to do anything about it.

We Vaisyas may be coming off our date-rape drugs and discovering that we are taking it in the rear, but the only way for us to respond, according to the new Brahmin theory, is to allow ourselves to be tied up and then relax and enjoy it. MM's "critique" is simply an admission of what we Vaisyas were with the Internet starting to find out anyway, but spun in such a way that we are just supposed to admit defeat and enshrine the Brahmins with a secure "property right" to perpetual fraud and theft. But in fact these Brahmin powers are eroding, and they need new mythologies, new justifications and new kinds of security and deprivations to the rights of Vaisyas, in order to maintain their sole source of nutrition, the tax revenue they steal from Vaisyas.

But if the Brahmins are already in total control why the need to increase the security of their control? Why their paranoid fear of violence?

The answer is that MM is describing the control that Brahmins once had and are now trying to get back. He is describing the era of mass media pre the fall of the Berlin Wall and pre Internet. But Brahmin power has been eroding since the fall of the Berlin Wall, and that erosion has only accelerated with the growth of the Internet.

Freedom of the press was once fine, because Brahmins controlled the presses. Now that everybody has a printing press this freedom is a major threat to their power, and the top agenda item of the Brahmins is to come up with a political mythology to motivate putting this genie back in the bottle.

The old myths whereby the Brahmins kept their power are dying. Communism and progressivism are on the wain. The Brahmins are growing paranoid and need new myths to sustain their mastery over the Vaisyas. Now the Brahmins to maximize their tax revenue must admit the power of markets and the power of property rights, but they also fear them, and must keep them strongly encaged. Indeed they must use perverted versions of these ideas to justify their own fraud and theft as kinds of "property rights" that we are to believe magically operate in a market-like fashion.

The Brahmins have their work cut out for them. They have to convince us that what the Brahmins are in fact doing, namely stealing, is in fact their birthright, their property right, and it is we Vaisyas who are stealing if we do not let the Brahmins eat up major portions of our livelihood, indeed if we do not let the Brahmins suck up a Laffer maximum portion of our Vaisya blood.

Thus the paranoid emphasis by Brahmins on violence and on security, and the use of rather silly libertarian-sounding arguments about property rights, corporations, and markets, to justify the violation of all political rights of the Vaisyas and the establishment of a tax collection system for our Brahmin masters that will be secure from any attack by Vaisyas when we discover their fraud and theft and start acting to stop it.

Brahmins need to test their myths by throwing out trial balloons. Setting up pseudonyms is a very good way to do this without damaging their true name reputations. If indeed MM is actually working for or with his Brahmin clan and Brahmin friends, rather than being the apostate he claims, his role clearly is one of throwing out trial balloons, or to switch metaphors he's trying out different baits on the hook to see on which ones the Vaisyas will bite.

This one isn't biting. While MM is quite correct that Brahmins have fraudulently gained power in the past, I see that power is now eroding, and it will take far more than novel and bogus claims that they somehow have property rights in violence, fraud, and tax collection to impress this Vaisya libertarian.

Really, the silliness of this particular trial balloon suggests that the Brahmins are in rather desperate straights and are now just grasping at straws.

August 25, 2007 at 4:54 PM  
Anonymous bbroadside said...

anon2, that is a clear and forceful argument and I thank you for replying. (I did Google the "martial law" reference you alluded to and I found it. Thanks for mentioning it.) I hope this thread won't get forgotten because yours is a needed perspective and I hope others will reply to it. Partly since I am running out of ammunition.

"This one isn't biting. While MM is quite correct that Brahmins have fraudulently gained power in the past, I see that power is now eroding, and it will take far more than novel and bogus claims that they somehow have property rights in violence, fraud, and tax collection to impress this Vaisya libertarian."

I hope you are right that their power is eroding. A more politically-active Vaisya class would be beneficial in every way that matters to me. I don't see it in my crystall ball, but I'll have a clearer idea in November 2008. The libertarians have been prominent on the web since the beginning (perhaps for reasons I described in my July 28, 2007 2:08 AM reply) and the web has steadily become more prominent, so maybe you're right.

UR resonates with my pessimism about Libertarian election prospects. It's one of the reasons I'm here. I really do believe the progressives are in control (not quite total) of the most important institutions, and that they are immune to every approach that has been tried so far. A sweeping view of history, a radical description of reality, postulated definitions which speed discourse - these things are valuable. The progressives don't need to be defeated if they can be changed. It may sound impossible, but the Republicans certainly changed.

If I saw UR's likely effect being the same as its stated intention - the replacement of democracy by a privately-owned nationwide security company with millions of blue chip stockholders who retired from universities or the Social Security Administration or whatever - I'd be less happy with this site. My gut tells me this is very unlikely. My bias is very much in favor of thought experiments.

"Really, the silliness of this particular trial balloon suggests that the Brahmins are in rather desperate straights and are now just grasping at straws."

Okay ... your guess is as good as mine. This trial balloon has the wry smile of many modest proposals but is vastly more compelling.

August 25, 2007 at 8:36 PM  
Anonymous anon2 said...

UR resonates with my pessimism about Libertarian election prospects. It's one of the reasons I'm here. I really do believe the progressives are in control (not quite total) of the most important institutions, and that they are immune to every approach that has been tried so far.

I don't know why after the Berlin Wall libertarians are still so pessimistic. Perhaps because we were so manically optimistic in the 1990s that changes abroad portended immediate changes at home.

But "progressive" institutions, especially the mass media, are slowly becoming less important. Schools are a tougher nut to crack, but as mass media dies they will become more dependent for their curriculum on the Internet.

History moves with glacial speed, but it does move. It was about 70 years from Gutenburg to the Protestant Reformation.

Ron Paul is no Martin Luther, but he does provide a taste of what is to come. Before this decade his kind would never have been allowed anywhere near a Republican debate stage or mainstream media show, unless it was to be portrayed as an utter villian (as for example Ayn Rand was anytime she tried it). Before this decade the vast majority of people would never have heard about him and his ideas.

The progressives don't need to be defeated if they can be changed.

The people who live off tax dollars mostly can't be changed, but the rest mostly can be -- albeit with excrutiating slowness.

August 26, 2007 at 2:34 PM  
Anonymous anon2 said...

This trial balloon has the wry smile of many modest proposals but is vastly more compelling.

I'm very curious, what is it in MM's evidence or reasoning or rhetoric that you find most compelling, and why?

August 26, 2007 at 2:40 PM  
Anonymous bbroadside said...

anon2, you paint a very positive picture and I'm going to ruminate on that too.

"I'm very curious, what is it in MM's evidence or reasoning or rhetoric that you find most compelling, and why?"

A lot of things going on here, and I'm not sure which is most important. To tell you the truth, it may just be that he shares some of my attitudes and feelings which I find to be shared very rarely.

Most people tend to hate and mistrust politicians and bureaucrats, libertarians even more so. The hate and mistrust is sometimes justified, but it still causes people to see the world unclearly. If they think the reason the Brahmins stick to destructive welfare policies (for example) is because the Brahmins sit around a bonfire gleefully rubbing their hands thinking of new ways to destroy civilization and reward irresponsibility, they're going to have more trouble coming to grips with those policies. If the whole public sector is evil we're pretty much finished. MM assures us the Brahmins aren't evil; they really are smart, well-intentioned people. I agree. I know those people - I went to school with them, I argue with them, I have lived with several.

MM treats ideas as if they had lives of their own and motivations of their own. They reproduce and mutate and try to route around our immune systems. So a party which which consistently wins elections by painting the Brahmins as an evil coven with a love of bonfires and irresponsibility will eventually end up espousing the very same policies. It becomes irrelevant who wins the elections. The pathogen has escaped the quarantine by infecting the caregiver.

That's not 100% original (and Mencius hasn't claimed it was); it borrows from Dawkins et al. But MM has taken it in a very original direction (as far as I know). The pathogen here - progressive-idealism, or cypto-Calvinism, or whatever - has propagated itself by choosing its host wisely. It has chosen kind-hearted articulate people since they are best at spreading it around.

If the Brahmins were evil, they would have serious trouble cooperating. In fact they cooperate surprisingly well (given how much conflict they create). If the Brahmins were evil, they would attract a completely different (and much smaller) set of people for their successors. They'd simply be less effective. (The Brahmins do have nefarious steely-eyed rogues as allies, which is why it is so important not to conflate Brahmins with Dalits.)

To me it's just a very valuable perspective. It inspires the Brahmins to take a hard look at themselves; it doesn't concentrate too much on inspires Vaisya, Optimates, etc., to fight the Brahmins (which they've been doing all along, though not to the extent of sending back their Social Security checks).

Many libertarians and more conventional conservatives concentrate on assertions: The paternalist establishment fosters dependence upon the state in a self-serving attempt to secure their own jobs. The water rolls off the duck's back. The Brahmins don't see it is as selfish to secure their own jobs, because of their dogmatic belief that their jobs help others in the long term (in the short term, they are often right). A lot of them are civil servants, after all. They are paternalistic in treating the poor/ needy/ oppressed as children in a more literal (and positive) sense than the libertarians may at first realize. It's quite the opposite of fostering dependency, if you've been bitten by the progressive-idealist bug. Children grow up (hopefully) into responsible adults because we nurture and indulge them and gently penalize their transgressions. The Brahmins have every expectation that the Dalits and Helots will likewise transform into responsible, autonomous individuals if only they get enough indulgence (affirmative action, welfare etc.) That is hardly self-serving.

It is just demonstrably wrong. Crime and poverty and the like have increased since the Brahmins have been running things, yet they don't blame themselves. Why not? Because they think they aren't the ruling class. Their Marxian worldview frees them from the bonds of rulership because of their heartfelt solidarity with the proletariat - they just know they're the rebels. It's the Optimates who run the show. And it takes a nigh-religious zeal for the Brahmins to convince themselves of this.

Instead of angry assertions, UR tactitly asks the Brahmins several questions: Have you noticed that your worldview always portrays you as the only possible world savior? And have you noticed that that sort of thinking in the past hasn't lead to the world being saved? When do you correct your own thinking? Why did you wait until the mid-1990s to even begin reforming welfare when your man Moynihan (granted, not a Brahmin by birth) had warned you about the problems three decades previously? Why do bad government policies continue when anybody can see that they're bad?

The old right-wing/ revelationist liberals-are-evil argument may win votes, but it's not going to convince the Polygon. People generally know if they are evil or not. That is my explanation of why I like UR (not as brief as I had intended ... probably my Brahmin habits showing through).

August 26, 2007 at 4:13 PM  
Anonymous TGGP said...

anon2, you know the Republican party nominated Goldwater years ago? Reagan even got elected cloaking himself in semi-libertarian rhetoric. Ron Paul has no chance of winning the nomination. He and his policies are extremely unpopular nationwide. No revolution is going to occur.

August 26, 2007 at 7:36 PM  
Anonymous anon2 said...

If the Brahmins were evil, they would have serious trouble cooperating.

There are many predators who are great at cooperating, including humans. Predators do not act among themselves as if they are evil or treat each other as if they were evil. Indeed, from a scientific view predators are simply a part of nature rather than being evil. If the predators are humans they will laugh at how unsophisticated their prey are for thinking that there is such a thing as evil, just as Brahmins laugh at anybody who believes in evil.

But I fully excuse the prey for viewing their predators is evil. I fully excuse the slave for believing that his master is evil. I fully excuse a person infected with a virus for believing that the virus is evil, even though it is only a simple string of nucleic acids.

Indeed, the belief on the part of prey that his predator is evil is a simple and very effective survival strategy. Prey who do not believe that their predators are evil will die. Hosts who believe that their diseases are innocent inhabits will succumb. Slaves who do not believe that their masters are evil will remain enslaved.

Indeed, there are many predation strategies involving lures and disguises that involve convincing the prey that the predator is innocent, and humans are the animals who have taken this strategy to the pinnacle of its sophistication.

By the way, as long as we're being pessimistic here, you're forgetting the possibility that our degree of slavery and predation could be far worse. The easiest way for our predators to make it worse is for them to trick us into stepping into a completely secure trap. After that, as MM points out politics doesn't matter. After being locked in a fully secure cage, it won't matter how evil the slaves think that their masters are. After full security for the masters there will be no possible escape.

August 27, 2007 at 4:17 PM  
Anonymous Anonymous said...

Both Mencius Moldbug (MM) and Anon2 begin with the same assumption - that the absolute, cameralistic state would be strong.

I have a simple suggestion. Forget theory, look at the actual examples. There is such a state - it is called China. Is it strong? It used to be strong, when it was building the communist heaven on earth. Mao could kill millions, destroy country, introduce artifical hunger, stop people from having children - in a country where children are necessary even after your death- and still was obeyed and worshipped as a god.

The present Chinese leadership, to the contrary, is weak - and it knows it. They are deadly afraid. They need an uninterrupted economic progress simply to survive. They must bribe the army and the people. When they used some anti-natalist slogans from Mao's time, they had to remove them - because people were dissatisfied.

They are furiously attacking any organisation independent from the state, be it a church or a gymnastic society - because they can be defeated by each one.

Modern Western states, to the contrary, feel secure. The politicians think, and have good reasons to do so, that their rule rests on unshakable fundaments. They can indulge in every stupid policy or war, and them mismanage it. No matter; they can afford it.

Why it is so? Because their rule is not based on reality, but on an idea: that idea is called "the rule of law". Not Democracy, except so far as free elections are part of the Law.

My contention is that the Western politicians are mistaken and that they managed to diminish the strength of that idea. But that strength is still immense.

To conclude - the state is strong when it is build on an idea. If you should build an openly utilitarian, formalist and cameralist state it would be weak and would die.

BTW - the dichotomy between the organisation of a state and a corporation is false. They differ a bit in USA. In continental Europe they are nearly the same. Here you have an elecorate which elects a Parliament which elects a government which has a Prime Minister, who rules in practice. In corporations there are shareholders who elects a Board of Oversight which elects a Managing Board (I translate the terms on the fly, so they won't be correct in English-I meant Auffsichtsrat and Vorstand) with the President who leads the company.

The organisation is the same. In fact, the sociology is also similar. You won't find many technical specialists as CEO; they are usually managers; the two careers are separated. Corporations have also an equivalent of the courts - even better, in fact it seems the corporations use the exact same courts as the state.

The only important difference is that you can have many shares but only one vote. But it is only the modern system.

One hundred years ago, there existed many systems with multiple votes for people paying more taxes. They were defeated, because the broke the LAW. And as I explained, the LAW is the real strength of the state.

Baduin

August 28, 2007 at 5:04 AM  
Blogger Mencius Moldbug said...

anon2,

I find your arguments very interesting, and wish I had not been so dismissive of them! I treated you as a troll when you actually intended to make a thoughtful contribution. Please accept my apologies and stick around.

I'm afraid you'll just have to take my word for it that I read both Larry Auster and the Mises Institute blog on a regular basis. Nothing would please me more than a libertarian Vaisya revolution. If the US military recognized its duty to uphold the Constitution tomorrow, I'd be in the street throwing confetti (although considering where I live, I'd probably better pick a different city - it'd be unadvisable for anyone in San Francisco to make any kind of threatening motion in the direction of such a force.)

And I do believe the present system is evil. That the lion does not think of himself as evil does not make him anything but. Similarly, Universalists do not see themselves as evil, but nor did Communists or Nazis.

I think what you're missing, though, is what gives the poison its sting. The problem with the Universalist state is its essentially mystical conception of itself. Removing this mystique is a way of pulling the snake's fangs.

Of course, one could just hit it over the head with a shovel, as I think you would prefer. The shovel, however, does not seem to be at hand. And surely, with a snake, the more ways of killing it, the better.

I think the main point where we disagree is in your belief that, if we handed over the shares in Fedco to (for example) its current employees, who let's say for purposes of argument are all Brahmins, it would continue its present bad habits.

This might be true for a short period of time. But note that it's awfully hard to find corporations whose shareholder base has any appreciable impact on their behavior. The entire corporate system is set up to maximize profit. Profit is such a clear metric that it tends to dominate any fuzzier management goal. And when shareholders see their stock price go up and down, metaphysical concerns tend to evaporate.

What the Brahmins get out of their concern for "creating change" and "social justice" is a feeling of power. They love power - everyone does. They don't think of it as "power," of course, but it is what it is.

So, for example, what is the most heinous aspect of Brahmin rule? I think it's pretty clearly anarcho-tyranny (in Sam Francis's term) - the obsessive affection for criminals. In a corporate system, crime and urban decay are bad for business and tend not to survive. Under democracy, alliance with criminals offers many paths to power.

The US was founded as a libertarian minimalist confederation of sovereign states. In 70 years it was a violent, corporatist nationalist superstate. Suppose we go back to the past? Why won't the same thing just happen all over again?

There's a reason Brahmins hate corporations. I believe it's the same reason that vampires hate garlic. The very thought of a system of management that is based on property and leadership is hateful to them, because it has no place for those whose main skill is exploiting mob psychology. When we look at modern governments that approach neocameralism, such as that in Singapore, we see that Brahmins have basically no power and are ignored.

So, by issuing Brahmins shares in Fedco, I am in effect suggesting a deal: paying them off, in exchange for taking away their power. Of course they deserve to be penalized, not paid. But the problem is so important that any way of solving it is worth considering, n'est ce pas?

Furthermore, in reality, I don't think the Brahmins would accept this deal. They do hate garlic, after all. But isn't the fact that they refuse it pretty damning? I certainly think so.

August 28, 2007 at 5:08 PM  
Blogger Mencius Moldbug said...

Baduin,

To conclude - the state is strong when it is built on an idea. If you should build an openly utilitarian, formalist and cameralist state it would be weak and would die.

Actually, I think the neocameralist state might well sacralize law as its ruling principle. After all, the legitimacy of the state is derived from the fact that it is owned by its shareholders.

China is neocameralist except in one point - it has no formal ownership structure. And this point seems very likely to be its undoing. Its rulers are lawless and they know it, and whatever internal Party clique (or, worse, movement outside the Party) does a better job of unseating them can defeat them.

When you have a formal shareholding structure, on the other hand, the shareholders are united for the purpose of defending the state. Their interests are perfectly aligned, and they are not squabbling with each other to steal each others' shares. Thus, they have the motivation and opportunity to preserve the state and keep it strong.

As for corporate structure, the US governmental structure is a sort of parody of corporate governance ("President" was first a corporate title). European systems borrow from both the US and English models - the latter is different, but it also was not originally democratic.

But what they are missing is the precise connection between those who control the state, and those who profit from it. Thus there is internal tension and corruption that does not appear in truly private companies.

August 28, 2007 at 5:16 PM  
Blogger Mencius Moldbug said...

anonymous,

The basic starting principle for anarchism/libertarianism is "no initiation of force." Eg., no taxation. If some organization wants my money, they have to convince me to voluntarily sign a contract saying I will give it to them.

And no, the "social contract" doesn't count.


If governments were actually legitimate property owners, the "social contract" would count. Because, as any property owner can, they would give you a choice: sign the contract, or get off the property.

August 28, 2007 at 5:18 PM  
Anonymous anon2 said...

MM, apology accepted, and I must express my own sorrow that I must at times express my argument in personal terms, although as a potentially influential blogger with ideas that I believe are extremely threatening to what remains of my freedoms you of course will have to understand and expect such criticism.

And I do believe the present system is evil. That the lion does not think of himself as evil does not make him anything but.

Yes, but why do you think the lion is evil? Because you are the prey and the lion is your predator, or because you yourself were raised to be a predator but can think of more efficient ways of going about the hunt than our current pathetic lions?

I'm afraid you'll just have to take my word for it that I read both Larry Auster and the Mises Institute blog on a regular basis.

I do not doubt this. Disguise, even to the point of self-deception, is one of the master skills of a predator.

The problem with the Universalist state is its essentially mystical conception of itself. Removing this mystique is a way of pulling the snake's fangs.

I don't disagree with this on its face either, but you are leaving the most crucial things out. The more accurate metaphor is a vampire bat rather than a snake. A vampire feeds off its victim, just as the Brahmin tax collectors feed off of my labors, whereas a snake against a human is simply trying to defend itself.

The biggest problem though is that you are proposing not merely to remove vampire's fangs, the dying mystique of democracy, but to replace them with a hypodermic implant that the victim cannot remove. You propose not to eliminate or even reduce the predation, but rather to maximize the predation, to attach the hypodermic with an unbreakable lock.

I think the main point where we disagree is in your belief that, if we handed over the shares in Fedco to (for example) its current employees, who let's say for purposes of argument are all Brahmins, it would continue its present bad habits.

No, if this could be done with the immunity from political pressure that you imply, it would make things far worse for the Vaisya than they presently are. Of course the habits of Brahmins, from the point of view of Brahmins who would like to increase the efficiency and overall satisfaction they derive from predation, would be greatly improved.

The main useful outcome for Vaisyas from removing the democratic mystique is if that would serve to reduce the predation of Brahmins on Vaisyas. But what you are proposing is a system whereby you Brahmins do not need these dying myths to drink of our Vaisya lifeblood. Instead the old myths can be replaced with a new myth that Brahmins have "property rights" to our lifeblood, and with strong security to protect those "rights". The Ring of Fgarl is the predator's ideal.

As prey I will never accept that my predator has property rights in my labor or profits. Any friend of mine will do his utmost to ensure that said predators too crippled to chase me. Anybody who strengthens the predator, who makes the predator more efficient, is my enemy.

it's awfully hard to find corporations whose shareholder base has any appreciable impact on their behavior.

Readers with any knowledge of how corporations actually work have figured out by now that your share distribution scheme is a charade and that management stays strongly in control regardless of the wishes of the shareholders, but thank you for finally admitting it.

But I must admit there seem to be many readers unaware of this and you have found a great way to take advantage of their ignorance. You masterfully keep using this shareholder pretense to ignore, and effectively disguise the existence of, the real power center in your proposed scheme, namely the Brahmin management. You replace the mystique of democracy with the mystique of share trading, but it serves the same function of hiding the actual predatory Brahmin hierarchy.

Neocameralism will retain the same Brahmin managers it has now, as long as they see the benefit for Brahmins of the new neocameralist way of enforcing their power. Some of the old predators, grown long in the tooth, longing for the good old days when their mass media could predetermine elections, and unable to see the better predation that is now possible, and even necessary, with neocameralism, will have to be sent packing.

The entire corporate system is set up to maximize profit.

You either don't know much of anything about corporate governance or are again engaging in deceptive rhetoric based on your shareholder mythology. It is well know that corporations maximize profit only where shareholders exert full control. When management is unaccountable to shareholders corporations maximize only revenue, which they dole out to themselves.

In your scheme, now by your own admission, shareholder control is a charade. The only thing maximized in your scheme are the funds stolen from Vaisyas and retained by the Brahmin management.

So, for example, what is the most heinous aspect of Brahmin rule? I think it's pretty clearly anarcho-tyranny (in Sam Francis's term) - the obsessive affection for criminals.

Of course you would think so. It's hard to collect taxes from drug dealers and other criminalized markets.

There's a reason Brahmins hate corporations.

They only hate competing centers of power.

in reality, I don't think the Brahmins would accept this deal.

Of course not, because in reality there is no Ring of Fnargl, no securely locked hypodermic, much as you wish there was.

The result of MM's revolution? "Meet the new boss, same as the old boss."

August 29, 2007 at 1:42 PM  
Blogger Mencius Moldbug said...

anon2,

Here's the essence of your argument. If it's right, so are you:

You either don't know much of anything about corporate governance or are again engaging in deceptive rhetoric based on your shareholder mythology. It is well know that corporations maximize profit only where shareholders exert full control. When management is unaccountable to shareholders corporations maximize only revenue, which they dole out to themselves.

In your scheme, now by your own admission, shareholder control is a charade. The only thing maximized in your scheme are the funds stolen from Vaisyas and retained by the Brahmin management.

Where did I admit this? You are absolutely right that shareholder control is crucial. A corporation without shareholder control is a mafia.

In fact, this is exactly what we have today: a pseudo-democracy which originated as a parody of corporate forms, in which the Vaisya masses - now rapidly being outnumbered by imported Helots - supposedly control the state. Whereas, as you say, it is actually controlled by its Brahmin administrators.

Indeed, if you replace one man, one vote, with another fake pseudocorporate structure in which control purports to be given to the shareholders but in fact is not, the whole exercise is just as much of a sham as you suggest.

The political practicality of converting "Fedco" to a corporate structure - ideally not as a single unit, but as individual states, or even better hundreds of sovereign city-states - is so remote that it's useless to speculate as to how such a thing could come about. Clearly, like any political reform, it could be done badly.

What I will say is that once power is actually in the hands of shareholders, it will not leave those hands, as it has left the hands of voters. In other words, while I have no solution to the problem of how to get from here to there, I will assert that once you get to there, the system is stable.

Look at the difference between shareholders and voters. One, shareholders have a clear and immediate motivation not to let themselves be expropriated by managers - it will lose them money. Two, shareholders are perfectly aligned in their interests - all they want is money. Three, they are by no means atomized, because there are large shareholders as well as small ones, and the large will be wealthy and powerful, and have the money and power to employ consultants, Kirk Kerkorian style, to watch the managers.

(Corporate governance in the US today is lousy, because it was frozen by FDR in the '30s. We could do a whole lot better.)

The result will be a country that is controlled by its wealthy and powerful shareholders, through its security forces, who are very carefully disciplined to ensure that they are responsible to the board, not the CEO. Once you get to this state, it really doesn't matter who the shareholders are.

As for the hypodermic, don't you think it's about as deeply imbedded as it gets?

Think of it in terms of raw power. A state that does not tax at the Laffer maximum is leaving money on the table. This money is the prize to any interest which can capture the state. If you push the tax level down and create the minimal state, you give an incentive to all the schemers and oily academics who overran the minimal state we used to have.

Once upon a time, it made sense to propose an armed citizenry as a defense against state expansion. But that one was pretty well disproved in 1865, and it would have been even more disproved if the Union had had the Maxim-gun. I speak not of political righteousness, but military reality. Internal military resistance against a cohesive and determined modern state is inconceivable.

So not only is it unlikely that our rent will be reduced, it's arguably even imprudent to try.

But high taxes are the least of this country's problems, don't you think? I'd certainly say so. The problem is the power and obtrusiveness of government, not the level of payments it extracts.

Of course it would be nice to pay less. But I would give the IRS a raise if it would get us freedom of education, freedom of medicine, freedom from crime, etc, etc, etc. I wonder whether you agree or disagree with this?

August 29, 2007 at 10:19 PM  
Blogger epileptikitty said...

Marketing chicks in tight sweaters will whisper suggestively and slip me their room numbers as I autograph their books with broad, confident strokes of the pen.

Not with the haircut you had when last we met.

lance

September 7, 2007 at 8:20 PM  
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November 6, 2008 at 2:22 PM  
Blogger 信次 said...

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January 31, 2009 at 10:58 PM  
Anonymous Anonymous said...

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March 2, 2009 at 9:20 PM  
Anonymous Anonymous said...

^^ nice blog!! thanks a lot! ^^

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March 2, 2009 at 9:21 PM  
Anonymous Anonymous said...

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March 6, 2009 at 4:56 AM  
Anonymous Anonymous said...

~「朵語‧,最一件事,就。好,你西

March 6, 2009 at 9:14 PM  

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