Why Capitalism?

[Lilburne]

@Zavoi

@Danny Sanchez

If you were convinced that (A) complete adherence to the natural right of property happened to necessarily engender untold poverty, suffering, and death, but (B) the tiniest imaginable abrogation of the non-aggression principle, undertaken on a very infrequent basis necessarily engendered prosperity, happiness, and long life for virtually everybody, which would you choose, (A) or (B)?

I would question the basis of this question. I’d imagine you’d see yourself taking on the role of the Atheist Utilitarian in the following kind of dialogue:

Atheist Utilitarian (AU): Why do you only eat kosher food?

Jewish Deontologist (JD): Because God commands it.

AU: Oh really? Not because it’s healthy?

JD: Well, now that you mention it, kosher food is healthier than non-kosher food. But still, the reason I eat it is just because God commands it.

AU: So, if it were shown that kosher food was actually catastrophically unhealthy, would you still eat it, just because God commands it?

JD: [frantic attempts to repair this cognitive dissonance]

Ha! I like that, and I’ve never heard it before: thanks for sharing it. And yes I do think many libertarians, if they thought about it, would find themselves struck by that kind of cognitive dissonance.

@Zavoi

Now, the type of deontology espoused by libertarians (e.g., Rothbard, Hoppe…) is not “divine command theory” providing an objective ultimate end and saying that certain actions must (not) be performed under any circumstances, regardless of what any persons’ preferences are. Rather, the only purpose of these theories is to resolve disputes between people whose preferences conflict. So,

• If people agree on an ultimate end (e.g., prosperity, happiness, and long life for virtually everybody), then there is no fundamental dispute to resolve – it is not necessary to call upon a deontological theory in the first place.
• Only if people disagree at such a fundamental level that their preferences cannot be reconciled by pragmatic arguments (like Mises’s), does it become necessary to invoke deontology.
• In that case, however the dispute is resolved, someone is going to be happy and someone is going to be unhappy – it’ll never end up that both of them are unhappy.

What do you think? Do we ultimately have to involve an interpersonal utility comparison to object to deontology in this way?

But if that deontology has no bearing on either party’s ends, neither would be convinced by it unless they were indoctrinated to believe that it was an end in itself. Thus the deontology can only ever be a noble lie: a curiously cerebral superstition whose only merit is not via any truth, but only via the extent that people have been indoctrinated into accepting it. “Because-I-said-so” indoctrination is a thin reed upon which to base society. Eventually the mind of man would overthrow it, in the unlikely event it was ever yoked by it in the first place.

And we have no need of any such noble lie anyway. The preponderance of individuals would benefit vastly from a pro-capitalism system of laws. If they are convinced of that fact, they will support it. And, again, as la Boetie, Hume, Mises, Rothbard, and Hoppe all agree, social orders are fundamentally based on majority opinion; so if they support it, it will happen. Any of the tiny number of people who might actually materially benefit from an anti-capitalist system of laws, and are aware of the fact, don’t need to be sold deontology. They can simply be dealt with by the courts and constables (or PDAs) that would be characteristic of such a condition of popular opinion.

[Amanojack]

These last few excellent insights suggest that finding an efficient way to elucidate these principles is imperative. Graphical expositions of the capitalist system are something you (Danny) are already doing, which has surely helped enlighten many.

But I see here an opportunity for another groundbreaking project: Perhaps many here can agree that once the semantic and moralistic debris is cleared away, it is hard not to see the superiority of the capitalist system. I envision a systematic approach to clearing away word-based errors in general and building people’s capacity to see through insidious semantics, both intentional and unintentional, both demagogue-inflicted and self-imposed, as I believe all “noble lies” and collectivist fallacies - from both state apologists and of misguided libertarians - are made possible by the poor correspondence between thoughts and the words we use to express them. (Look for more in a different thread, hopefully coming soon…)

[Lilburne]

@AdrianHealey

@Danny Sanchez

What is the nature of this interconnection? Can you summarize Long’s argument (of which AJ doesn’t think much) for me?

It might be interesting to organize a group and watch Roderik’s long philosophy seminar together (http://mises.org/media.aspx?action=category&ID=90) because I don’t think I’m able to do justice to his argument.

I think it goes something like this - but keep in mind that this good be a (semi-)wrong interpretation - "well, something that is good for people, is also morally good. But something that is morally good, obviously is also good for people in a more economic sense. So there is no real need for a strict dichotomy.’

What does “morally good” mean here?

@AdrianHealey

Related, I personally think that both ‘natural law’ and ‘economics’ is both based on praxeology, i.e. the logic of action. Praxeology in the economic sense investigates the logic of action in a world with multiple relevant actors, where it can be shown that ‘interventionism’ hampers people achieving their goals by using ends. Praxeology applied to ethics investigates the logic of action in a world with multiple relevant actors, where it can be shown that interventionism harms people - else they would have agreed to it - so there vision of the world gets hampered.

Sorry I can’t make sense of this last sentence.

@AdrianHealey

Praxeology recognizes different actors and proofs that in order for there to have a economy that satisfies and coordinates human ends we have to have independent actors (differentiated from others by property rights). On the other hand; these differences are also morally relevant, i.e. because I’m not you and you are not me, we need a way to settle on any given situation if we disagree on what ought to happen with a specific means. E.g. If I want to kill you and you oppose it, than there is a different vision in using a certain means for a certain end. Economics can show that as a general rule: allowing people to kill each other, would hamper other ends that could be achieved. But if we have independent actors, why would it be impossible to construct an ‘ought’, i.e. we ought not to hamper other actors in the world?

What do you mean by “ought not to”?

@AdrianHealey

Obviously; I’m not a full pledged philosopher (yet) and I can’t give a clear and cut bullet proof intellectual framework. But thinking along these lines doesn’t seem completely idiotic.

That’s totally fine. Just be careful not to be biased, as someone inclined to libertarianism, by what conclusion would be nice to be true or coherent.

@AdrianHealey

<= I’m not convinced by the ‘false dichotomy’ accusation. What Mises is saying that legal positivism claimed that laws can’t be upheld to any outside standard, which is not true.

There have been many strands of legal positivism throughout history. Just because you’re not familiar with the one Mises is referring to, don’t assume he’s just making it up.

@AdrianHealey

Legal positivists don’t (just) say: ‘well, everything the state does can’t be criticized’. They are saying ‘there is no outside source of law. That is the law.’ Obviously, this can be criticized - as Mises himself often did - because it lacks x, y and z. But it’s still the law and it doesn’t make sense to talk about anything outside of what is created by the law as the law.

The dichotomy between natural law and legal positivism isn’t ‘can one criticize the law from a certain viewpoint?’ (which legal positivism accepts), but can we analyze what the law ought to be in the absence of someone saying what the state says it is. Can we, in fact, have a science of what law ought to be?

Natural law and utilitarianism agree that it is possible to analyze what the law ought to be. However, utilitarianism recognizes that it can only be an individual who analyzes what law ought to be, and he can only do so in light of his own individual ends. The natural law tradition of Rothbard alleges that one can objectively discover what ends all men, by virtue of their nature as men, ought to have: that the ends, according to which men judge laws, can themselves be held up to a standard. This standard is, in effect, an alleged “super-end” that transcends individual human ends. By positing such a trans-individual end, Rothbard eschews the methodological individualism that he adheres to in economics.

[Autolykos]

@Danny Sanchez

Lots of effort has gone into [thymology]. Every time a historian makes a judgment about the ends pursued by men in the past, he is using thymology. Every time an entrepreneur makes a judgment about the ends pursued by men in the future, he is using thymology. They just don’t call it that.

I guess I should’ve been clearer with my question. It seems to me that thymology is the study of the non-acting component of human nature, if that makes sense. So while studies of history are certainly useful (if not essential) in that regard, I think it’s at least possible to deduce and/or infer general thymological principles. However, I haven’t seen anything in the way of this within the Austrian Economics community. Perhaps Rothbard did so in some of his writings, but if he did, I’m afraid he didn’t clearly distinguish his thymological statements from his other statements.

@Danny Sanchez

It need not be defined in strictly material terms for men to agree, in their own interest, to liberalism and capitalism, only in predominantly material terms and only for most men. And the material wants don’t even need to be that “cherished” upon reflection. They only need to be high enough in actual priority. As Phillip Wicksteed said, “A man can be neither a saint, nor a lover, nor a poet, unless he has comparatively recently had something to eat.”

Yet people are certainly capable of prioritizing non-material self-interest/well-being over material self-interest/well-being – even to the point of necessarily dying as a result.

@Danny Sanchez

It is true that a Robinson Crusoe, or even someone living in somewhat less autarkic conditions, like a primitive tribesman, can store up resources, and thus engage in a limited degree of roundabout production. But with the present and foreseeable size of population on the earth, the prevention of the very likely starvation of most any given individual depends on the kind of capital accumulation that is only possible with a vast intertemporal division of labor. And the latter is only possible with the economic calculation that can only be found in a capitalist system of social cooperation.

While I certainly agree that the present human population could not have come about without a vast intertemporal division of labor, any given individual 1) is not logically required to recognize this apparent fact, and 2) is not logically required to participate in social cooperation in order to accumulate capital and/or consumer goods for himself. Of course, the fact that so many people are alive today does support the notion that the vast majority of people do want to participate in social cooperation. The question is: why is that? Do they formally discern that doing so will better fulfill their ends? Or do they have an instinctive desire to cooperate? I think that, while the former is surely done at times, the latter is the ultimate answer.

[Lilburne]

@AJ

These last few excellent insights suggest that finding an efficient way to elucidate these principles is imperative. Graphical expositions of the capitalist system are something you (Danny) are already doing, which has surely helped enlighten many.

But I see here an opportunity for another groundbreaking project: Perhaps many here can agree that once the semantic and moralistic debris is cleared away, it is hard not to see the superiority of the capitalist system. I envision a systematic approach to clearing away word-based errors in general and building people’s capacity to see through insidious semantics, both intentional and unintentional, both demagogue-inflicted and self-imposed, as I believe all “noble lies” and collectivist fallacies - from both state apologists and of misguided libertarians - are made possible by the poor correspondence between thoughts and the words we use to express them. (Look for more in a different thread, hopefully coming soon…)

I, like LS and Michael, am also really glad you’re back, AJ.

[Autolykos]

@Danny Sanchez

It is true that I certainly do not mean the latter, in that Mises’ conception of capitalism includes joint ownership of means of production. (And I really hope that people do their own research enough that I don’t have to write up an explanation of the difference between joint and collective ownership. Rothbard covered it well in MES.)

[…]

“Private ownership of the means of production” is not the full definition of capitalism. Capitalism, or market economy, is “the social system of the division of labor under private ownership of the means of production.” (Mises, HA) That excludes, not only state ownership of all the means of production, but any allegedly possible collective ownership of all the means of production. A stateless world in which everyone’s inner conscience drove them to choose to pool all their resources collectively (anarcho-communism) could not be said to have private ownership of the means of production. (Although, Mises argued that the “state-free” socialism of Marx and others was impossible in practice.) Furthermore, a world in which there was no state, but nonetheless everybody chose not to exchange with each other (autarky) would not be a “social system of the division of labor” at all, and therefore would not be capitalism.

Thanks for clarifying, Danny. In parsing your definition, at first I thought that we could actually forego “private ownership of the means of production” and focus entirely on “the social system of the division of labor”. Now, however, I realize that Mises is implicitly combining two separate concepts together. The first is social cooperation, which implies division of labor; the other is control or disposal of means and their products, which you call “‘ownership’ in the economic sense”.

I see now that Mises takes social cooperation as a given. His analysis concerns which conceptual system of controlling/disposing means and their products advances social cooperation the most (or at all, as some would put it). As we all know, his answer is to leave that control in the hands of individuals, either singly or jointly.

So with this in mind, I think we can see that later writers, such as Rothbard, did not take social cooperation as a given. The question these writers had was: what makes man decide to participate in social cooperation over social non-cooperation? In attempting to answer that question, they tried to find out which factors within man lead him to usually choose the former over the latter.

@Danny Sanchez

No, there is an “ownership” in the economic sense that is distinct from “ownership” in the juristic sense. See the first chapter of Socialism on this. And, as I intimated above, ownership implies disposal of both the means itself and its product.

Thanks, I’ll read up on that.

[Autolykos]

@Danny Sanchez

Of course it is, otherwise we wouldn’t be in this mess. I never said the persuasive minority of bright minds was always correct in their propositions, only that the public is ultimately guided by them.

Right. My point was to show that the public (so to speak) can be convinced that social non-cooperation is more in their self-interests than social cooperation, at least in certain areas and under certain circumstances. Furthermore, the persuasive minority of bright minds can be convinced of that themselves, or at least can consider it in their self-interest (at least at times) to promote social non-cooperation. I think it’s useful to (try to) understand why these things seem to be the case.

@Danny Sanchez

The vast majority of the bright minds of this world would benefit more handsomely in a materially ascending social system of production than in a stagnant or disintegrating one.

Sure, but do they realize that? If not, then why not?

Not to get too rhetorical, but do you think Josef Stalin would have benefitted more handsomely in a materially ascending social system of production than in a stagnant or disintegrating one?

@Danny Sanchez

Just curious, are you then in favor of using noble lies and quasi-religions to try to establish a liberal social order?

No, I’m not interested in fooling people or even trying to. Though I’m not sure what exactly you mean by “quasi-religions”.

@Danny Sanchez

Man is homo agens. We have flourished because of our capacity for goal-seeking behavior. If we were as pathological and dead-to-purpose as you seem to think we are, we would not have been able to accomplish an iota of what he have.

Point taken. However, not everyone would say that he has flourished, and not all goals are in line with social cooperation.

And actually, it could be said that there are different levels of social cooperation. Take the Roman Empire, for instance. Certainly there was plenty of social cooperation going on within Rome itself, but lots of social *non-*cooperation going on outside as its armies conquered the Mediterranean world.

[Lilburne]

@Autolykos

So with this in mind, I think we can see that later writers, such as Rothbard, did not take social cooperation as a given. The question these writers had was: what makes man decide to participate in social cooperation over social non-cooperation? In attempting to answer that question, they tried to find out which factors within man lead him to usually choose the former over the latter.

He did do that, but in his historical works, not in his ethical works.

[Lilburne]

@Autolykos

@Danny Sanchez

Of course it is, otherwise we wouldn’t be in this mess. I never said the persuasive minority of bright minds was always correct in their propositions, only that the public is ultimately guided by them.

Right. My point was to show that the public (so to speak) can be convinced that social non-cooperation is more in their self-interests than social cooperation, at least in certain areas and under certain circumstances. Furthermore, the persuasive minority of bright minds can be convinced of that themselves, or at least can consider it in their self-interest (at least at times) to promote social non-cooperation. I think it’s useful to (try to) understand why these things seem to be the case.

Sure. I certainly never claimed otherwise.

@Autolykos

@Danny Sanchez

The vast majority of the bright minds of this world would benefit more handsomely in a materially ascending social system of production than in a stagnant or disintegrating one.

Sure, but do they realize that? If not, then why not?

Various reasons (which are not really the topic of the thread ;)).

@Danny Sanchez

Not to get too rhetorical, but do you think Josef Stalin would have benefitted more handsomely in a materially ascending social system of production than in a stagnant or disintegrating one?

He is one of the tiny majority of people who did prosper more than he would have under less hampered capitalism. And even so, only ex post. Stalin was extremely lucky he happened to end up on top of the murder-heap, and did not end up the victim of another Stalin’s purge. Ex ante, he had no guarantee that would occur, and any person in a similar ex ante position could only reasonably expect to be liquidated at a young age.

@Autolykos

@Danny Sanchez

Just curious, are you then in favor of using noble lies and quasi-religions to try to establish a liberal social order?

No, I’m not interested in fooling people or even trying to. Though I’m not sure what exactly you mean by “quasi-religions”.

Basically the same thing as a “noble lie” (like the one in Plato’s Republic).

[ricarpe]

Outstanding thread, Lilburne Danny. Thank you, it is an amazing read and very thought-provoking.

[Zavoi]

@Danny Sanchez

But if that deontology has no bearing on either party’s ends, neither would be convinced by it unless they were indoctrinated to believe that it was an end in itself.

On this I think we agree: that the only way a deontological theory can be true is if we strip away all the “end-in-itself”-preaching from it, leaving something that is not intrinsically motivating for anyone. However, I disagree that deontology is necessarily either false or useless.

This is because the practical purpose of deontology is not to change anybody’s ultimate ends, but to serve as a focal point for negotiation between them. (A lot’s been written about focal points; the first two paragraphs of this section are a good explanation of the idea.)

For example, suppose we were playing a game in which we’re given a list of mathematical expressions, and told to choose one of them. We are also told that another team has been given these same instructions, and that if we both choose the same expression, then we both get a prize. We analyze the expressions, and discover that they all equal 0 except for one of them. We consider choosing that one, but then someone objects, “What is this mystical property ‘≠0’ anyway? Sure, I agree that only one option has this property, but still, why should we expect this to affect the other team’s actions? Unless they are indoctrinated to believe that ‘choosing ≠0-expression-denoting-marks’ is an end in itself, they won’t have any reason to do it.”

Likewise, I interpret your objection to the usefulness of deontology as saying “Sure, I could agree that only one dispute-resolution-rule has property P. But unless people are indoctrinated to believe that following P-rules is an end in itself, they won’t have any reason to follow it.” The reply to this objection is the same as the reply to the previous one.

@Danny Sanchez

And we have no need of any such noble lie anyway. The preponderance of individuals would benefit vastly from a pro-capitalism system of laws. If they are convinced of that fact, they will support it. And, again, as la Boetie, Hume, Mises, Rothbard, and Hoppe all agree, social orders are fundamentally based on majority opinion; so if they support it, it will happen.

On this, I agree with what De Jasay says in The State:

@"[De

(http://www.econlib.org/library/LFBooks/Jasay/jsyStt1.html#1.1.9)"]My contention here is that preferences for political arrangements of society are to a large extent produced by these very arrangements, so that political institutions are either addictive like some drugs, or allergy-inducing like some others, or both, for they may be one thing for some people and the other for others. If so, theories that people in general (Hobbes, Locke, Rousseau), or the ruling class (Marx, Engels), mount the political arrangements that suit them, need be approached with much mistrust.

In other words, we can’t be sure that people, as they are now, actually do prefer a capitalist order (or even that they would if they knew everything about economics).

[Lilburne]

For example, suppose we were playing a game in which we’re given a list of mathematical expressions, and told to choose one of them. We are also told that another team has been given these same instructions, and that if we both choose the same expression, then we both get a prize. We analyze the expressions, and discover that they all equal 0 except for one of them. We consider choosing that one, but then someone objects, “What is this mystical property ‘≠0’ anyway? Sure, I agree that only one option has this property, but still, why should we expect this to affect the other team’s actions? Unless they are indoctrinated to believe that ‘choosing ≠0-expression-denoting-marks’ is an end in itself, they won’t have any reason to do it.”

Likewise, I interpret your objection to the usefulness of deontology as saying “Sure, I could agree that only one dispute-resolution-rule has property P. But unless people are indoctrinated to believe that following P-rules is an end in itself, they won’t have any reason to follow it.” The reply to this objection is the same as the reply to the previous one.

What are the replies to the two objections, and how are the two meaningfully analogous?

On this, I agree with what De Jasay says in The State:

@"[De

(http://www.econlib.org/library/LFBooks/Jasay/jsyStt1.html#1.1.9)"]My contention here is that preferences for political arrangements of society are to a large extent produced by these very arrangements, so that political institutions are either addictive like some drugs, or allergy-inducing like some others, or both, for they may be one thing for some people and the other for others. If so, theories that people in general (Hobbes, Locke, Rousseau), or the ruling class (Marx, Engels), mount the political arrangements that suit them, need be approached with much mistrust.

In other words, we can’t be sure that people, as they are now, actually prefer a capitalist order.

We must be clear on the difference between preferences and interests. People most evidently do not prefer the capitalist order; I’m not saying they do. I’m saying they would if enough intellectuals understood, and enough people were convinced of, the conclusions of sound economics. Of course political institutions themselves effect preferences regarding social orders, because they effect individuals’ understanding of the relative efficacy of various alternative means to their ends. But political institutions don’t change the one almost universal fact about human ends: the fact that everyone is primarily concerned with material prosperity. And they don’t change the fact that liberalism and its concomitant unhampering of capitalism is truly the most effective means to material prosperity, however people presently underestimate it. Economics education is the only way that the real and ever-present harmony of interests can be translated into a harmony of actual preferences.

[MJGreen]

@Danny Sanchez

The art utilized by goal-seeking lawmakers may involve applied praxeology, but that does not make law a branch of praxeology.

Well, I think I agree with that, but it seems to me like a semantic issue. Would economics be considered a “branch of praxeology,” even though the science of praxeology cannot provide economic actors with substantive aims? That is, praxeology can tell us what an entrepreneur is, and can tell the entrepreneur what to consider in order for his endeavor to be successful, but it cannot tell the entrepreneur that he ought to invest resources in such-and-such. I would not say that “law is a branch of praxeology,” but that there can be a branch of praxeology concerned with rulemaking.

And JohnnyFive, thanks for the heads-up! Adolf Reinach does sound familiar; I’ll be sure to check it out.

[Zavoi]

@Danny Sanchez

What are the replies to the two objections, and how are the two meaningfully analogous?

In the analogy, the prize represents the benefits of cooperation (i.e., of not having to fight over everything). The reason why the no-communication case relates to real-world negotiation is elaborated on by Schelling in The Strategy of Conflict (see pp. 77-84 of the PDF (67-74 by the printed numbers)). Basically, it comes down to the need to establish an ultimatum, as well as the fact that communication is impaired by mistrust.

The reply to both objections is essentially “If not here, where?” Only one option has a salient property that distinguishes it from the others, and so we choose it because we expect that they will expect that we will expect that they… [etc.] …will choose it. This is the same mechanism by which any legal code acquires its respect, despite not being regarded as “an end in itself.” In the same way that seemingly pointless math can help achieve coordination in the example, seemingly pointless deontology can help achieve coordination in human affairs.

@Danny Sanchez

But political institutions don’t change the one almost universal fact about human ends: the fact that everyone is primarily concerned with material prosperity.

I’m not certain about this matter one way or another, since I haven’t done the kind of extensive empirical research that would be needed to determine it. However, I would like to know what your supporting evidence for this is, because the evidence I do have is prima facie against this claim:

• De Jasay suggests that the influence of the state over people’s preferences is not just a result of its influence over their understanding of the efficacy of means: e.g. “Once begun, the addictive nature of redistribution sets in motion unintended changes in individual character and the family and group structure of society.” (Source, emphasis added)
• A number of studies have shown that increased material wealth does not lead to increased happiness, at least after a certain level (1, 2).
• In fact, it appears that relative status and dominance are a major influence over behavior (e.g., this; the anecdotal evidence that terms like “tall poppy” and “crab bucket” exist).

Again, this is just speculation, which I welcome any input on. Though in any case, it doesn’t have to do with deontology per se any more than the strategizing in the example has to do with math per se.

[MJGreen]

Zavoi: I don’t believe your first reference to de Jasay applies. When writing of “preferences for political arrangement of society,” he is concerned with theories about how the state comes into being and why it persists. He is criticizing the view that the individuals of a society come together and successfully and rationally craft the state; and, in turn, the state ultimately does what the subjects (or the ruling class) want it to do. The whole section, after all, is investigating the arguments as to why a people would willingly adopt a state. The argument that Danny is making and attributing to la Boetie and Hume is quite distinct in that it says people consent to the authority of the state, not that they effectively control it. In both cases there is consent by the subjects, but the former is an active will on the part of some group while the latter is a passive acceptance. Whereas Hobbes might say, “We wanted a monarch” or “We live under a monarch because we have chosen it as the best course of action,” la Boetie would say, “A monarch attained power and we, for various reasons, allow him to keep that power.” de Jasay criticizes the former because the subject of a monarch has been conditioned to society under a monarch; he has no basis to compare that life to any other arrangement, in which his preferences may be different. The latter does not conflict with de Jasay’s argument, which makes sense given that de Jasay explicitly credits Hume with a better analysis of the government than the contractarian story of Hobbes, Locke and Rousseau (see here). And it nicely complements Weber’s view, which de Jasay praises following your quote.

And I think you’re totally backwards on the second de Jasay quote (and, again, I think you’re using it out of context). The addictive nature of redistribution can change individual character and the family and group structure of society, but precisely because the end of those involved is material gain. De Jasay’s great metaphor - that the state’s interventions cause the muscles of voluntary capabilities of society to atrophy - supports Danny’s point that people are largely interested in increasing their material wealth. Without the state, this requires cooperation, possibly a strong family structure, etc. With a welfare state, (non-political) voluntary associations become less important, the family structure is less useful, etc., because people believe they can profit more through the redistributive arm of the state. Without the state, a mother is incentivized to marry a man for financial assistance; with the state providing assistance to single mothers, this incentive is diminished and the traditional family structure offers less utility. After all, the family does not become a less effective means for achieving some moral or spiritual end in the presence of wealth redistribution.

And regarding the contention that man, in general, is primarily concerned with his material well-being, I think we ought to return to Mises here. It’s not necessarily that people only or predominantly desire material wealth, but that society is only capable of providing for the material desires of its subjects. Spiritual enlightenment is not attained by a certain distribution of property rights. And insofar as people desire peace, well - harmony of interests and all that.

[Lilburne]

@Danny Sanchez

What are the replies to the two objections, and how are the two meaningfully analogous?

In the analogy, the prize represents the benefits of cooperation (i.e., of not having to fight over everything). The reason why the no-communication case relates to real-world negotiation is elaborated on by Schelling in The Strategy of Conflict (see pp. 77-84 of the PDF (67-74 by the printed numbers)). Basically, it comes down to the need to establish an ultimatum, as well as the fact that communication is impaired by mistrust.

The reply to both objections is essentially “If not here, where?” Only one option has a salient property that distinguishes it from the others, and so we choose it because we expect that they will expect that we will expect that they… [etc.] …will choose it. This is the same mechanism by which any legal code acquires its respect, despite not being regarded as “an end in itself.” In the same way that seemingly pointless math can help achieve coordination in the example, seemingly pointless deontology can help achieve coordination in human affairs.

Alternative legal codes won’t acquire near-universal respect just because people think, “well we’ve got to use some standard, and this standard is ‘salient’, so we might as well abide by that.” With regard to any given conflict of interests, there might be any number of “salient” standards one can choose, and individuals will always be inclined to support the salient standard that is pursuant to their own interest. Which brings us to the point that the only kind of saliency that can command near-universal assent to a rule is an ex ante tendency for the establishment of the rule to benefit any given person.

I’m not certain about this matter one way or another, since I haven’t done the kind of extensive empirical research that would be needed to determine it. However, I would like to know what your supporting evidence for this is

As Mises argued, you can see it in the clear state of affairs that political parties nigh invariably promise higher living standards to their flock. This in turn stems from the clear state of affairs that people generally vote in favor (according to their often flawed judgment regarding means) of their own pocketbooks and their own comfort.

De Jasay suggests that the influence of the state over people’s preferences is not just a result of its influence over their understanding of the efficacy of means: e.g. “Once begun, the addictive nature of redistribution sets in motion unintended changes in individual character and the family and group structure of society.”

Individual character has as much to with means as does any other product of human custom.

A number of studies have shown that increased material wealth does not lead to increased happiness, at least after a certain level (1, 2).

In fact, it appears that relative status and dominance are a major influence over behavior (e.g., this; the anecdotal evidence that terms like “tall poppy” and “crab bucket” exist).

I think Gilles Saint-Paul makes an important point here regarding the dubious (and I think feather-bedding oriented) “happiness economics”:

In fact, people always make choices that are not supposed to make them happy but instead are linked to how they view themselves and what goals they have in life: career, status, the transmission of properties, abiding by some community values, etc. For example, an individual could report a low level of happiness because he is concerned about his children. That does not mean that he made the wrong choice by having children. In other words, happiness is only one part of individual welfare, not the whole of it.

Also, as so often occurs with statistical research, econometricians have also gleaned from the data conclusions that directly oppose the “Easterlin Paradox” and “hedonic treadmill” 1, 2, 3, 4, 5.

[Lilburne]

@Michael J Green

And regarding the contention that man, in general, is primarily concerned with his material well-being, I think we ought to return to Mises here. It’s not necessarily that people only or predominantly desire material wealth, but that society is only capable of providing for the material desires of its subjects. Spiritual enlightenment is not attained by a certain distribution of property rights.

Excellent point.

[Amanojack]

@Michael J Green

De Jasay’s great metaphor - that the state’s interventions cause the muscles of voluntary capabilities of society to atrophy - supports Danny’s point that people are largely interested in increasing their material wealth. Without the state, this requires cooperation, possibly a strong family structure, etc. With a welfare state, (non-political) voluntary associations become less important, the family structure is less useful, etc., because people believe they can profit more through the redistributive arm of the state. Without the state, a mother is incentivized to marry a man for financial assistance; with the state providing assistance to single mothers, this incentive is diminished and the traditional family structure offers less utility

I raise a tangential issue in reply to this here.

[Zavoi]

@Danny Sanchez

With regard to any given conflict of interests, there might be any number of “salient” standards one can choose, and individuals will always be inclined to support the salient standard that is pursuant to their own interest.

The whole point of salience is to achieve coordination between parties; its purpose is defeated if each person just chooses what’s best for him-/herself. The overriding priority in these games is to reach an agreement; each player would rather reach an unfavorable agreement than no agreement at all. Thus, for example (from Schelling): “The white line down the center of the road is a mediator, and very likely it can err substantially toward one side or the other before the disadvantaged side finds advantage in denying its authority” (p. 154/144). It’s not that the disadvantaged driver is misinformed or sees line-following as an end in itself; just that it’s the best way to avoid crashing – just as we obey laws unfavorable to ourselves because it’s the best way to avoid violent conflict.

@Danny Sanchez

Which brings us to the point that the only kind of saliency that can command near-universal assent to a rule is an ex ante tendency for the establishment of the rule to benefit any given person.

By “ex ante,” how far back in time do you mean? Immediately before the conflict, or all the way back to the Rawlsian original position, or somewhere in between?

@Michael J Green

It’s not necessarily that people only or predominantly desire material wealth, but that society is only capable of providing for the material desires of its subjects. Spiritual enlightenment is not attained by a certain distribution of property rights.

The most plausible counterexample I can think of is a person who above all else yearns to have authority over others – certainly this is a social matter rather than a purely private one. This person might rationally prefer to be poorer in absolute terms if it means being richer in relative terms.

@Danny Sanchez

career, status, the transmission of properties, abiding by some community values, etc.

“Status” and “community values” are arguably not material goods…

Anyway, I’m willing to concede this to the judgement of those more knowledgeable than I. The only thing I can say for sure is that human values are complex.

But the main point of contention is: do there exist genuine conflicts of interest between people? The fact of scarcity has often been taken as given; e.g. “It does not need much comment to see that there is indeed scarcity of goods, of all sorts of goods, everywhere, and the need for property rights is thus evident” (Hoppe, p. 18-19). But to put it in more concrete terms, I should start by asking: If material wealth is what I care about, shouldn’t I favor a total free market except for a 0.01% tax that everyone must pay to me? (And likewise for anybody else.) So, to live peacefully together, don’t we all have to make concessions against our material interest?

[liberty_student]

@Autolykos

While I certainly agree that the present human population could not have come about without a vast intertemporal division of labor, any given individual 1) is not logically required to recognize this apparent fact, and 2) is not logically required to participate in social cooperation in order to accumulate capital and/or consumer goods for himself.

After reading AJ’s post here, where I think he takes Danny’s argument further than it has the legs to go, I had to come back to this discussion and point out that there seems to be a rational expectations thing going on with regards to capitalism. Yes, capitalism is the best system for achieving material wealth, but I think an error may be created where we work from the premise that men psychologically desire material wealth above other psychological valuations, or that material wealth is necessary or primary to the achievement of psychological wealth.