Atlas Shrugged hitting record sales? What the hell - Page 8

But in the Austrian view human action is always "rational".

Satisfaction of a given valued end is prefered sooner over satisfaction of the same end later

A good consumed in the present cannot be consumed in the future

To challenge this, you must present an example of human action which is not "rational", or, in other (better) words which is not purposeful pursuit of valued ends using scarce means.

There are innumerable reasons why economics is a poor discipline to tackle with empiricism.

Again, I think I've failed in conveying the objective effectively. What sorts of non-tradeable goods can not be incorporated. This isn't outside the scope of austrian theory. What are you talking about? Give me an example. I don't think there is anything in the human domain which cannot be accounted for.

The problem is that you always have to make that choice for some people by force. Why do that? If anything it's just begging for trouble - you create civil unrest any time you have to force people to do things they don't want, and every extraneous government programme is something like this.

And if people do have to be forced, then are you really the benevolent nation you appear to be....

Man's greed is infinite - he will always find new desires to satisfy when previous ones are sated.

On April 21 2009 10:10 Caller wrote:

Libertarianism is the idea that people should have civil liberties and economic liberties alike. Akin to the classical liberalism of the Enlightenment (see: John Locke, Mill), it advocates a minimal size of government and negative liberties, i.e. the right to do whatever you want without infringing on the rights of others.
There are many branches of Libertarianism. On one hand, you have the Objectivists, Ayn Rand's faction. They believe in Egoism, which essentially praises the individual above all else, i.e. "I will not live my life for the sake of any other man." They are very anti-welfare, but are criticized by other libertarians because they trust too much in Ayn Rand as a cult, as well as more didactic differences.
You also have the Austrian branch, i.e. RON PAUL 2012. These libertarians are bordering anarchy-they are considered anarcho-capitalist. They believe that government should play no role in anything, and that in a private, free-market (this is key) people will be able to succeed and spread prosperity, and there will not be large mega-corporations infringing the people.
You have then more mainstream Libertarians in the Chicago Branch, which was based off of Milton Friedman's theories. Friedman was very opposed to most government involvement in the economy, and also advocated (to a lesser extent) government influence in war and civil policy. This branch is the most mainstream and is essentially one of the core groups of the Libertarian party.
If you want to know the thinkers that advocate Libertarianism, the list would include John Locke, Alexis de Tocqueville, Edmund Burke to an extent, Rousseau, Thoreau and Emerson, Milton Friedman, F. A. Hayek, Thomas Jefferson, John Stuart Mill, George Washington, Ludwig von Mises, and there are many, many other thinkers that support libertarian thought (although back then, it was considered liberalism, not today's liberalism, which is more of a progressivism/democratic socialism)

On April 21 2009 19:59 Tal wrote:


Thankyou, and cheers to the other replies. The objectivists sound fairly unpalatable, it seems odd to totally remove empathy from philosophy. I'm familiar with Locke, Burke, Rousseau and Mill - and can kind of see how Locke and Burke are part of a free-market tradition, with their focus on property rights. I'm less sure about Rousseau and Mill, as it seems their ideas like the general will or utilitarinism could be drawn upon by any ideology.
It sounds like it would be worth me checking out Hayek and Friedman, could you recomend a core text?
In answer to whoever said Conservatism isn't an ideology, I know that technically it isn't (being largely reactionary to the trends of the time), but the way I studied it showed that it valued certain principles (tradition, property rights, stablity), in a fairly ideological way, so it can generally be talked about in the same way.
I still haven't quite got my head round the core point of Libertarianism. If a free market is promoted, and that generates wealth (which it seems to do), why is that the best thing? What gurantee does that give to the unfortunate? It seems like by its nature there could be no safety net in place, which seems kind of troubling...

On April 21 2009 16:26 SWPIGWANG wrote:

That is a matter of definition. While it is possible to build a internally consistent structure from a number of basic definitions, it does not make it "useful."

An assertion, not a proof. The fact that I'm typing this as opposed to having lunch is a counter example. (and one counter example is sufficient)

I listened to my music CD therefore can not listen to it again? Oh, but "consumption" means destruction and what we have is 1+1 = 1+1 since what one has proven is that "goods that are destroyed is destroyed" but says nothing about "real" goods.

I can not present this under the framework of axioms presented, but I can point out the flaws of the framework.

Humans all die. Humans even kill themselves. So what is value? The definition here is circular because VALUE IS DEFINED BY ACTION! Because people do, therefore value is assigned.

What this is, is a classic philosophical bait and switch trick that is all too common in philosophy, where on hijacks the meaning of a common word by a matter of indirect definition and while inferring the common meaning to support an argument.

If all possible human action is "valuable", from suicide to murder, than it is but a useless word.
---------------------------------
I can not tell you what is valuable since you yourself have to find it in yourself.

My suggestion is to disbelieve whatever you are looking at, step back and imagine yourself believing another set of well developed philosophy (throwing everything of the old out of the window) and see if you can disprove it without bringing in outside concepts. Play around a bit and you'd understand the limits of logic.

Think about it this way. You are first of all a human being (over a thinking, rational or logical being). If humans are suppose to be logical beings with the same set of starting axioms, than there'd be no arguments in the universe since the result is self evident. (with enough processing power) Since that is not what humans do, there is no need to tie yourself to a logic frame work. It is fine to be the irrational "i don't know and i don't care" just as well. Frankly, the latter might be more useful starting point for arguments as logical frameworks are just tools.

You can define value as this, i can define value as god's law or some other crap and one wouldn't be able to have a debate since fundamental disagreement on the axioms can not be argued by logic.

Axioms without observation is pure math.

There is no functional discipline outside of empirical discipline. Axiomatic approaches result in models and only models and making it truth is just broken epistemology. Since there is no observation, there is no understanding of what is a "human", thus it would be perfectly valid to say:

"In the neo-austrian view, ant action is always rational. Ant action is an actor's purposeful pursuit of valued ends with scarce means. ....*15 pages of inductions latter* and we thus prove that ownership and free trade is optimal for ants"

Yes, it would be perfectly valid, since the specifics of human (or ant) capabilities and behavior is not necessary.

On April 21 2009 23:48 SWPIGWANG wrote:
2.1 In every voluntary exchange, between two individuals both except to benefit at outset of exchange, otherwise they would not. Exchanges must have unequal value in the eyes of the participants and have opposite preference orders. Is this even a hypothesis and how would we go about testing it.

Answer: Testing is easy, just have self reports during/before the exchange, or one can engage in psychological experiments where one is offered a exchange which is then interrupted and a gift of either the good being offered in the exchange is given away without cost instead. (which should work if given decreasing marginal utility)

How can this statement be false: when exchange of items is of lesser importance than other factors, for example exchange of gifts which is often a formality. (just remember gifts your throw away....)

2.2 If we raise the minimum wage to 1million dollars, unemployment would rise:

How can this statement be false: when 1million isn't worth much, look at this 100billion dollar bill (it is not worth a third of a dollar)
en.wikipedia.org/wiki/Fileimbabwe_Hyperinflation_2008_notes.jpg

Note that massive numbers is possible through normal inflation over long periods of time, but normally what happens is that new currency with smaller numbers are issued. Certainly, with another species better at math this may not be the case.

Alternative way this statement can be false: one operates under communism/hyper-monopoly which prints all the money! Or if we assume an adjustment period (which can be very short given fast systems) than one can imagine the velocity of money increasing sufficiently to increase the money supply to inflate it back to worthlessness.

...and so and so on.... now factors like relative purchasing power and no alternative employment structures can not be axiomically derived but observed. That said, this is a functionally absurd statement that has high trust value due to number of previous confirmations of the model.

2.3 If we quadrupole supply of money overnight, keeping all else constant there will be inflation: See the line above in section 2.2. Note this would be untrue if velocity of money if highly variable, and this is uncommon since this level of instability is far shorter than human adjustment cycles.

2.3 Under-socialism without private ownership factors of production and then there is no prices for factors of production, one can not use cost accounting

Counter example: The state can still use money and markets as a internal control mechanism despite not having private ownership. One possible arrangement would be markets between government owned organizations. Another possibility would be the assignments of tradeable rights (right to use land, rights to build stuff and so on) and rents out of factors of production but still retain ultimate ownership.

2.4 Decreasing marginal utility and fulfillment of the highest utility demand first.

Counter example: Network effect systems. For example, phones. The first phone is of low utility while every extra phone today have much higher utility due to all the other phones that exist. The same is with airports, internet access and so on. Hell, windows is valuable only because there is so damn many windows computer around.... (thus with it, IT people and supporting software written for the platform)

2.5 Things like Pythagoras theorem or a ball of red and non-red. They are analytic propositions do not need to be proven. (but do not necessarily say anything about reality, like 14 dimensional non-Euclidean geometry as opposed to planar triangles)

4. Argument: Other economists (that aren't Austrian school) run finance and make money, but they aren't the richest people on earth and there are other rich people that don't use models and thus they don't count.

My counter argument: Well, if we see richer Austrians than they'd have a point. Economic theory is not perfect and economists make money mainly out of market imperfections which is finite.

On April 21 2009 23:48 SWPIGWANG wrote:
Someone posted "Professor Hans-Hermann Hoppe: Praxeology: The Austrian Method" video on the Austrian method, and I'll answer his points here.

1. Popper does not prove his own philosophy as correct unless you take its propositions as correct to begin with: That is true with all philosophy as all of them assert correctness by simply claiming it or applying circular logic.

2. Absurdity examples where things don't have to be prove and can not be disproven:

Now first of all, I should note that in strictly empirical science, many statements are still "functionally absurd" like claiming that falling from a tall building won't result in death on impact. In the strictest popperian sense, this is not an fundamentally absurd claim, but it is functionally absurd due to amount of falsifications involved. This points to a probabilistic view of knowledge which he glanced over. Now look at his examples:

2.1 In every voluntary exchange, between two individuals both except to benefit at outset of exchange, otherwise they would not. Exchanges must have unequal value in the eyes of the participants and have opposite preference orders. Is this even a hypothesis and how would we go about testing it.

Answer: Testing is easy, just have self reports during/before the exchange, or one can engage in psychological experiments where one is offered a exchange which is then interrupted and a gift of either the good being offered in the exchange is given away without cost instead. (which should work if given decreasing marginal utility)

How can this statement be false: when exchange of items is of lesser importance than other factors, for example exchange of gifts which is often a formality. (just remember gifts your throw away....)

2.2 If we raise the minimum wage to 1million dollars, unemployment would rise:

How can this statement be false: when 1million isn't worth much, look at this 100billion dollar bill (it is not worth a third of a dollar)
en.wikipedia.org/wiki/Fileimbabwe_Hyperinflation_2008_notes.jpg

Note that massive numbers is possible through normal inflation over long periods of time, but normally what happens is that new currency with smaller numbers are issued. Certainly, with another species better at math this may not be the case.

Alternative way this statement can be false: one operates under communism/hyper-monopoly which prints all the money! Or if we assume an adjustment period (which can be very short given fast systems) than one can imagine the velocity of money increasing sufficiently to increase the money supply to inflate it back to worthlessness.

...and so and so on.... now factors like relative purchasing power and no alternative employment structures can not be axiomically derived but observed. That said, this is a functionally absurd statement that has high trust value due to number of previous confirmations of the model.

2.3 If we quadrupole supply of money overnight, keeping all else constant there will be inflation: See the line above in section 2.2. Note this would be untrue if velocity of money if highly variable, and this is uncommon since this level of instability is far shorter than human adjustment cycles.

2.3 Under-socialism without private ownership factors of production and then there is no prices for factors of production, one can not use cost accounting

Counter example: The state can still use money and markets as a internal control mechanism despite not having private ownership. One possible arrangement would be markets between government owned organizations. Another possibility would be the assignments of tradeable rights (right to use land, rights to build stuff and so on) and rents out of factors of production but still retain ultimate ownership.

2.4 Decreasing marginal utility and fulfillment of the highest utility demand first.

Counter example: Network effect systems. For example, phones. The first phone is of low utility while every extra phone today have much higher utility due to all the other phones that exist. The same is with airports, internet access and so on. Hell, windows is valuable only because there is so damn many windows computer around.... (thus with it, IT people and supporting software written for the platform)

2.5 Things like Pythagoras theorem or a ball of red and non-red. They are analytic propositions do not need to be proven. (but do not necessarily say anything about reality, like 14 dimensional non-Euclidean geometry as opposed to planar triangles)

3. Claim: Empirical science is useless in social science since predictions are tainted by knowledge:

Now all things are effected by knowledge, and those are indeed can not be predicted. That is the limit to knowledge due to observation horizon and thats all.

4. Argument: Other economists (that aren't Austrian school) run finance and make money, but they aren't the richest people on earth and there are other rich people that don't use models and thus they don't count.

My counter argument: Well, if we see richer Austrians than they'd have a point. Economic theory is not perfect and economists make money mainly out of market imperfections which is finite.