Interesting in its own right, the below lesson in breaking open parmesan cheese strikes me as providing a graphic analogy of how spontaneous order and man-made order interlock fruitfully. To adapt to and use the possibilities of a self-generating order to your advantage you must study and understand its nature, and learn to find an interface between its features and your needs. Respect for and insight into emergent order will tend to enhance the range of wholesome applications for conscious intervention. It would be rather a surprise if people, on being given more liberty, were not to extend their efforts at controlling their environment and making it accord ever more closely with their needs. For that reason alone, politics and freedom are inseparable twins of great potential and ambivalent effects.
See also my post on Greed versus Self-Interest, in which I argue that what defines man is the urge to adapt to his environment by developing and satisfying new needs. This fundamental anthropological condition explains the incidence of the entrepreneur and free markets, no less than the presence of political ambition and creativity. Proper stewardship of liberty requires participation in the vast areas in which politics rather than market based activities determine the nature and extent of freedom in a society.
As of today, Australia no longer has the most expensive “carbon” price in the world. The voters didn’t ask for a tax in 2010, but it was forced on them in 2011. They rejected it wholeheartedly in 2013 but it still has taken months to start unwinding this completely pointless piece of symbolism which aimed to change the weather. The machinery of democracy may be slow, but this is a win for voters. 11:15am EST today: The Australian Senate passes the carbon tax repeal bill.
“Australia has become the first country in the world to abolish a price on carbon, with the Senate passing the Abbott government’s repeal bills 39 votes to 32.“ SMH
Now we need to turn off the tap to all the other green gravy rent-seekers who ignore the evidence.
Aesthetically I've never been a friend of skyscraper panoramas. But how high is high enough? Not all very tall buildings appear ugly or misplaced to me. What makes them pleasant to look at, what turns them into an uncomfortable sight?
The below video helps you imagine Paris as a city where buildings can only be one or two storeys tall. Mind you, architects are likely to come up with different designs if it is known beforehand that a certain height may not be exceeded.
Anyway, which is more pleasing and nicer to live in, the city without regulations or one with urban planners in the driver's seat? Is there a best mix of both? How is it achieved?
We, believers in freedom, certainly need a sharper eye for the interfaces and interlocking between markets and public institutions, private decisions and public decisions.
How Public Is Public Enough?
Back in the 1930s, the Ostroms (including the late Nobel prize winning Elinor Ostrom) started an entirely new field of research by doing empirical research on municipal services and urban public goods. The findings concerning police departments in Indianapolis, Chicago, St. Louis, Grand Rapids and Nashville challenged the notion that larger government produced superior public services:
The presumption that economies of scale were prevalent was wrong; the presumption that you needed a single police department was wrong; and the presumption that individual departments wouldn't be smart enough to work out ways of coordinating was wrong." (Cited from Institutional Diversity and Political Economy. The Ostroms and Beyond, by Paul Dragos Aligica, p. 45-46)
At the same time, the Ostroms discovered a middle ground between uncritical believe in powerful public institutions and unwarranted expectations of markets or unspecified forms of private decision making to provide public goods.
... there is no reason to assume apriori that competition among public agencies is necessarily inefficient (p.44)
The Ostroms explained that the variety of relationships between governmental units, public agencies, and private businesses, emerging, coexisting, and functioning in a public economy, "can be coordinated through patterns of interorganizational arrangements."
Interorganizational arrangements [...] would manifest market-like characteristics and display both efficiency-inducing and error-correcting behavior. Coordination in the public sector need not [...] rely exclusively upon bureaucratic command structures controlled by chief executives. Instead, the structure of interorganizational arrangements may create important economic opportunities and evoke self-regulating tendencies (Ostrom and Ostrom 1965, 135-36)
Libertarians must discard the straight jacket of simplistic anti-state attitudes. Instead, they need to participate in politics so as to shape the public institutions and discourse in ways conducive to liberty.
I see a parallel between the below dissent concerning depletable or non-depletable resources, and the controversy between the Keynesian vision and Say's view of the economy.
The confounding of physics with economics has plagued a real-world understanding of mineral resource developments. The phenomenon of entropy and the laws of thermodynamics rule in their domain. But there is no economic law analogous to the physical conservation of matter. There is no law of conservation of value; value is continually, routinely created by the market process. And this value creation does not deplete–just the opposite.
This insight reorients the peak-oil debate from pessimism about hypothetical future physical resources to here-and-now concerns over incentives and institutions–or the ability of a free market to create a robust energy future.
As for Keynes versus the classical economists: not aggregate demand (Keynes) is a limiting factor in the production of value in an economy, i.e. saleable goods, but the structure of supply (classical economists); i.e.
(1) if people are not allowed to produce what
(a) is within their means and capabilities to produce, AND
(b) meets consumer interest, or
(2) if they err in their attempts to match these two requirements (a) AND (b), then the economy will stall, as ipso facto the process of value creation is disrupted.
However, and here is the link between Simon and Say, the ability to produce economic value is, as I argue in Greed versus Self-Interest, built into human nature, and thus unlimited -- as long as incentives and institutions are geared to supporting this talent. More on Says's Law:
What a man produces is what he can bid for the produce of others. The value of what he creates – that is, its value to others – represents his effective demand in the marketplace. If he produces nothing, if what he produces has no value (mud pies), if what he produces loses its value (stone knives in the Bronze Age), or if he produces more than can be consumed (houses after a housing bubble has burst), he has no effective demand though his needs be unchanged.
This restates Say’s Law, which Keynes in his General Theory popularly, though misleadingly, formulated as: Supply creates its own demand – misleading because a supply of goods with no value yields no effective demand and because supply that does have value to others does not create effective demand, it is effective demand.
What Keynesians do not understand is that if a man is hired to dig holes and then fill them back up, he is fully employed but he produces nothing of value; effective demand is not increased by his efforts. Nor does giving him money or goods in exchange for his useless labor create effective demand; it only shifts it from the people who produced what was given him.
Only production creates effective demand and only after what was produced is sold can other goods be purchased and consumed. What changed England was not increased consumption but increased production, production that made increased consumption possible.
There's a naive tendency to believe that whatever a government agency's mission is supposed to be, is really the mission that its people pursue. That's seldom the case for long.
Science fiction writer Jerry Pournelle, observing such things, has formulated what he calls the Iron Law of Bureaucracy: In every organization there are two kinds of people: those committed to the mission of the organization, and those committed to the organization itself. While the mission-committed people pursue the mission, the organization-committed people take over the organization. Then the mission-committed people tend to become discouraged and leave.
As a result, the strongest priority of most bureaucracies is the welfare of the bureaucracy and the bureaucrats it employs, not whatever the bureaucracy is actually supposed to be doing. That's worth remembering, whenever someone says they've found something else that we should "choose to do together."
This is not unique to government, but a rule for all organizations. However, in a private-sector, organizations that devolve in this way get slaughtered (except of course for crony favors and bailouts, but that is another topic). Accountability never ever comes to government organizations.
The land registry offices of Germany and England (the two countries where I have had personal dealings with such institutions) are doing just what they are supposed to be doing; they do it well, they are accountable internally and externally, which means that they can be effectively challenged via channels of informal settlement as well as legal action.
At the same time, a concomitant feature of misery the world over is a lack of precisely such well working bureaucracies as the land registry office.
Hence I sent this (now slightly edited) comment to the Coyote:
While it is simply not true that there is no accountability for bureaucracies, the proposed argument is by itself pertinent. But it suffers from the public choice syndrome, as I call it: It is not good enough to write a book about the zoology of the elephant that lists nothing but elephant diseases.
A vital deficiency in the standard arguments on this issue by my fellow libertarians consists in pointing out problems of state bureaucracies without offering explanations how and why they have evolved (as a pretty stable features of the state for thousands of years) and how to replace them with something better.
Libertarians will remain a fringe for ever unless they begin to realise that our social order depends on innumerable institutions (the state, bureaucracies, democracy etc.) that are naturally ambivalent (containing the good and the bad) and are prepared to deal with this ambivalence rather than wishing it away.
Libertarians like to talk about spontaneous order when it fits their preconceptions, but do not see spontaneous order where it evolves practices and institutions that do not fit a neat account of liberty. That's why, absurdly, the USA looks to (many of) them like a concentration camp.
The presumption that I challenge is that because an institution has typical or even systematic deficiencies, it must and it can be replaced by an unmitigated improvement. Once this presumption is admitted (really unthinkingly) care is no longer taken in looking at the manifold pluses and minuses of the institution in question, and the constraints on any solutions to the problems the institution has evolved to come to grips with ( - once again spontaneous order without guarantees of preferred outcomes). At this point, it is easy, even seemingly natural to paint the institution all black. This approach is hardly recommendable, as it is based on a severe truncation of the truth.
Hence, the above misrepresentations ("accountability never comes to government organizations", or the false insinuation that government bureaucracies rarely fulfil the tasks that they are entrusted with.
When it is convenient for the own case to argue so, many libertarians are quick to point out how government and its bureaucracies fulfill their satanic purposes with consummate efficiency. Totally dominating us, the state has been doing this for thousands of years, and it is more effective, stronger, nimbler on its feet than any other social forces.
Obviously, in actual fact, matters are far more intricate and often more balanced and indicative of genuine advancement. A bias that makes you deny genuine progress (or simply real conditions) is intolerable, no less in libertarians than in the left-leaning.
Liberty is not being helped by truncating the truth.
One of the key errors that fosters the libertarian presumption against ambivalent non-market insitutions is discussed in my post entitled The Market Is Not a Democracy.
Environmentalists seem to all feel that capitalism is the enemy of sustainability, but in fact capitalism is the greatest system to promote sustainability that has ever been devised. Every single resource has a price that reflects its relative scarcity as compared to demand. Scarcer resources have higher prices that automatically promote conservation and seeking of substitutes. So an analysis of an investment's ability to return its cost is in effect a sustainability analysis. What environmentalists don't like is that wind does not cover the cost of its resources, in other words it does not produce enough power to justify the scarce resources it uses. Screwing around with that to only look at some of the resources is just dishonest.
I like the smell of coffee. Not regularly, yet with great pleasure I drink espresso, the only type of coffee that agrees with me.
"Die Katze lässt das Mausen nicht" (the cat will not give up mousing) - a leopard doesn't change its spots. To me the German idiom suggests - someone will not renounce his bad habits. "Mausen" is a colloquial terms meaning either to pilfer or to screw [sl.]; less readily coming to the contemporary mind, it might also be construed to mean what the English term "to mouse" means: to "catch mice".
Johann Sebastian Bach (1685-1750) was also apparently a coffee enthusiast. So much so that he wrote a composition about the beverage. Although known mostly for his liturgical music, his Coffee Cantata (AKA Schweigt stille, plaudert nicht, BWV 211) is a rare example of a secular work by the composer. The short comic opera was written (circa 1735) for a musical ensemble called The Collegium Musicum based in a storied Zimmerman’s coffee house in Leipzig, Germany. The whole cantata seems very much to have been written with the local audience in mind.
Coffee Cantata is about a young vivacious woman named Aria who loves coffee. Her killjoy father is, of course, dead set against his daughter having any kind of caffeinated fun. So he tries to ban her from the drink. Aria bitterly complains:
Father sir, but do not be so harsh! If I couldn’t, three times a day, be allowed to drink my little cup of coffee, in my anguish I will turn into a shriveled-up roast goat.
Ah! How sweet coffee tastes, more delicious than a thousand kisses, milder than muscatel wine. Coffee, I have to have coffee, and, if someone wants to pamper me, ah, then bring me coffee as a gift!
The copywriters at Starbucks marketing department couldn’t have written it any better. Eventually, daughter and father reconcile when he agrees to have a guaranteed three cups of coffee a day written into her marriage contract. You can listen to the whole thing above. The lyrics in German and English can be read here.