“A black swan is an event, positive or negative, that is deemed improbable yet causes massive consequences. In this groundbreaking and prophetic book, Taleb shows in a playful way that Black Swan events explain almost everything about our world, and yet we—especially the experts—are blind to them.”
I think I speak for the whole club when I say that we welcome a ‘playful’ book. As always, I encourage you to get a copy and follow along. Your comments will be warmly welcomed either here on the blog, or on our Facebook page. If you’d like to take part but lack either the time or inclination to take on a book, you can always visit the Econtalk archives to listen to two podcast interviews. The first is from 2007, when the book first came out, and the second is from 2010, after the release of the second edition. Join the fun!
Over the last month, I have been doing a bit of research and data collection, in my spare time, for Robert Wenzel of Economic Policy Journal. The work was to help him prepare for a speech that he gave at the Federal Reserve Bank of New York last Wednesday. Robert Wenzel is a good Austrian economist, and he really tore into the failure of Fed policies with no holds barred. It’s amazing the speech even happened, Bob’s account of the circumstances can be found here.
Further to yesterday’s post, let’s consider Jody Paterson’s evaluation of private charity and mutual aid in Honduras -
“The theory behind a Big Society – popular with the B.C. and Canadian governments as well – is that when governments withdraw social supports, communities step up to close the gap. Volunteerism increases. Citizens draw closer to their neighbours as each takes more responsibility for helping the other. Everybody lives happily ever after, and pays fewer taxes to boot.
So let’s consider the example of Honduras, then. It’s a Big Society if ever there was one, seeing as government does almost nothing and communities really are on their own. An outsider might presume a deeply ingrained culture of neighbourly support in a country like this.
But what the absence of social supports has actually created is a culture of survival. People are so used to living with the fear that the bottom could drop out of their lives at any moment - because it so often does – that all their energies go to taking care of their own. From what I’ve seen, Honduran families watch out for their family members in all kinds of ways, but anything outside of the family is somebody else’s problem.”
Because Jody thinks Honduras has a free market, she thinks that what she sees is the Big Society you get with a free market. But being wrong about the former means she is wrong about the latter. A Big Society isn’t simply one in which the needs of the less-well-off are attended to privately, it is one in which the actions of free people also serve to increase wealth and ceaselessly reduce the number of people who are impoverished. The Big Society you get with a free market is one in which the vast majority are well off, and have sufficient resources to aid those who are genuinely in need. And since it is a manifestation of voluntary co-operation between consenting people, it is most certainly morally superior to steal-from-the-rich redistributionism.
A metaphor for the manner and degree to which the Honduran government intervenes in the national economy.
Writer Jody Paterson, formerly of Victoria, recently packed up her life and moved to Honduras, where she is doing volunteer work for Cuso International. She continues to blog, and a recent post contains enough errors that it will take a few posts to address them all. Let’s begin at the beginning -
“We were commiserating over breakfast yesterday with the owner of the little hotel in Tegucigalpa where we stay when on Cuso International business. He described Honduras as a capitalist country without the balance of a social structure, which struck me as a near-perfect description of the place.
Honduras is the real-life embodiment of the kind of governance that conservative political forces in Canada, the U.S. and Great Britain think they want for their own countries. It has a free-market economy with very little government interference, a political structure built around the needs of business and the upper-class, and a distinct absence of social supports.”
This particular hotel owner appears to be a poor source of high-quality economic analysis. According to the 2012 edition of the “Index of Economic Freedom“, Honduras is ranked 98th in the world. In case you are wondering, this is not good. Not only is the Honduran economy labeled Mostly Unfree, but it is also below both the world AND regional averages for economic freedom -
“… completing licensing requirements remains costly. Labor regulations are burdensome and outmoded. A large part of the labor force relies on the informal sector for employment. The government continues to regulate the prices of key products and services.”
Expensive licensing requirements, burdensome labour regulation, and price controls are hallmarks of economic policies designed to manipulate economies so as to maintain or increase state power by favouring special interests. Although it is all too common for critics of free enterprise and limited government to blame troubles on those institutions, we can see quite clearly that that is not the situation in this case. Hondurans may have many things, but of free markets and limited governments they have none.
The Foundation for Economic Education is a tremendous resource for defenders of liberty, going far beyond the realm of economics in its exploration of all facets of freedom. I visit their blog daily, and have vastly improved my defense of libertarian principles by repeatedly plunging into their online archive of “The Freeman“. Two days ago, on their Facebook page , this intellectual cornucopia offered up an invitation -
“Check out this gem from the archives. An illustrated sampling of The Law by Bastiat, which helps people understand the nature of organized force. Download the full illustrated sample here.”
Enjoy, and please remember to thank them by sharing this with others.
If you are single and will one day get married, you might want to consider what business it is of the state. And if, like all good libertarians, you conclude ‘none’, then you might want to weigh the value of a state marriage certificate against the indignity of submitting an application to our overlords. And to aid your contemplation of this matter, who better to turn to than that Wazir of Wiener Dogs, The Whited Sepulchre? Attend to him as he quotes from the wisdom of Will Campbell -
“If there is a body, a community, which is truly Church, or even claims to be Church, why should it be the executor of Caesar’s documents? What is a marriage license but a legal contract? And what does any legal contract promise and offer except the right to sue one another at another time and place before another of Caesar’s agents? Perhaps such contracts are socially necessary but what does that have to do with us? And even if we are not Church now but want to become Church, free from the demands and legality of Caesar, why not start by returning all of his documents and refusing ever to do it again? “No, Mr. Caesar, that is not our understanding of what marriage is all about. If you must protect yourself and your citizenry in this fashion you may continue to do so. But not with our help and blessing. Let the faithful come before the altar of the One we must serve rather than, and before, you. And acting on His, and only His, authority we will pronounce them man and woman, husband and wife.”
My work entails leaving the office at about 10:00 to drive around to various locations. That’s the time our local CBC network hosts “Q with Jian Ghomeshi“. On Monday, Jian opened the show by talking about foxes that have been causing destruction at the London 2012 Olympic shooting venue. Here is the BBC on the topic.
Everything was fine until right up near the end, when Jian goes and says something about the area actually belonging to the foxes because they were there first. That they have a right to be there.
Here in Victoria, one hears that sort of thinking a lot, because there is an invasive deer problem that inevitably spurs debate about a cull, and bear and cougar are regularly sighted in the suburbs and even downtown. Any discussion of the topic is sure to result in a letter to the editor from someone proclaiming the animals’ rights. I think this is a little confused.
Human beings unquestionably have rights. When one of us violates the rights of someone else, then the violator is subject to the loss of some of his own rights. If animals also have rights, then why would it be expected that we must respect their rights while permitting them to violate ours? We wouldn’t do that with another human being. If someone came onto your property and destroyed your landscaping, you would say he’s a criminal. But would you charge a deer with trespass, theft, and vandalism? Of course not. In fact, someone who is sufficiently dismissive of the rights of others is viewed by society as no different than an animal. So I think we can dismiss the notion that animals should be treated as if they have rights. For the most part, we don’t even treat each other that way.
“The prisoner’s dilemma is a canonical example of a game analyzed in game theory that shows why two individuals might not cooperate, even if it appears that it is in their best interest to do so… One of several examples (used is the) “closed bag exchange”:
“Two people meet and exchange closed bags, with the understanding that one of them contains money, and the other contains a purchase. Either player can choose to honor the deal by putting into his or her bag what he or she agreed, or he or she can defect by handing over an empty bag.”
If this is an exchange that will happen more than once, and the same two people are involved, honourable behaviour is the most rewarding. When it is done in groups that are permitted to communicate with each other, reputation encourages honourable behaviour. But if the exchange will happen only once, and there is no recourse against defectors, defection is the optimal choice. But are there circumstances where that tendency can be overcome? Watch and see -
After a long battle, the Canadian long gun registry has been repealed. When the registry first came into place, many people registered their long guns, and others sold or gave theirs away. There are still others, though, who knew that registration has been a preamble to disarmament as long as there have been tyrannies, and who quietly secreted away their unregistered rifles and shotguns, to await either the end of the registry or the day every normal man has to spit in his hands, hoist the black flag, and begin to slit throats. Happily, those firearms can now be hauled out of storage and put back to peaceful and entertaining use. Canada is a better nation because of this.
I am pleased to report that more and more members of the Victoria LBC have acquired (or are in the process of acquiring) their Canadian Possession and Acquisition licenses for both restricted and non-restricted firearms. It is my earnest hope that they (and you) will all get one. Those of you who are hesitant, squeamish, or simply disinterested may wish to consider that a right which is not exercised is a right which is more easily lost. I imagine if the state were to start mulling over the possibility of increasing restrictions on owning firearms – perhaps even disarmament of the civilian populace – many of you would rush to arm yourselves, despite your misgivings! But getting a license, getting a firearm, and learning to handle the several varieties of firearms takes some time. If you wait too long, it may be too late. Please don’t put it off any longer. It is better to be a knowledgeable firearms owner and not need to be, than the other way around.
As for me, I just might go out soon and enjoy my freedom to get myself a nice, non-restricted, no-registration-required rifle. Maybe something easy to hide.
Well, that’s how it goes when the state is involved. When things go wrong, you can’t fix it by working harder, or by doing a better job. You can’t turn to a different supplier. The only thing you can do is beg, or whine, or threaten, or become violent. But you can’t take wages or benefits from the government and expect to keep your dignity. That’s not part of the deal.