Will Wilkinson on Charles and David Koch

by Don Boudreaux on March 28, 2011

in Current Affairs, Myths and Fallacies

Will Wilkinson – one of the blogosphere’s most fascinating voices – weighs in intelligently, at the Economist.com, on the ideological efforts of Charles and David Koch.  Here’s a key ‘graf:

I don’t think many people understand how little these institutions [Cato Institute, Institute for Humane Studies, and the Mercatus Center] depend on the Kochs’ continued generosity. Of the brothers, Charles is the ideas man, and his idea has always been to build a set of complementary institutions which, once mature, can thrive without his (or his brother’s) financial help. That said, I have no doubt that these institutions either would not have existed, or would have existed in a very different form, were it not for the Kochs’ institution-building philanthropy. Having committed about a decade of my life to a few of these institutions, I’d like to think that those labouring within them have had some affect on American culture and politics—have had some small success in increasing awareness of and strengthening the public case for the value of individual rights, free markets, limited government, and peace. I don’t think there’s been a huge effect, but surely there’s been an effect.

FYI, here’s a three-year-old column that I wrote in my effort to put to rest the silly and lazy “Progressive” notion that my GMU colleagues and I are shills for industry.

UPDATE: Here’s Brian Doherty at Reason’s Hit & Run on this matter.

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David R. Henderson March 28, 2011 at 6:56 pm

Don, I agree with you that it’s a good piece, but I was surprised that Will didn’t mention that the Koch brothers gave $20 million between them to the ACLU to fight the USA Patriot Act. That’s approximately 5000 times what they gave to Scott Walker. And while I normally like what Glenn Greenwald writes, I thought his hatchet job on an ally who is funding one of the main causes he favors was disgusting.

Don Boudreaux March 28, 2011 at 6:58 pm

David: Great point. I, too, though, was unaware of that contribution by the Kochs to that worthy cause.

tkwelge March 28, 2011 at 9:56 pm

I heard that there is still no actual evidence of that donation taking place. I could be wrong, though…

Why do libertarian have to defend the Kochs? I mean, if they are on the straight and narrow, fantastic, but if they are dirty businessmen, how would that invalidate libertarianism? Even if they only donated to libertarian organizations out of greed, that doesn’t make those ideas any less worthy of debate or understanding. Companies often pretend to be “family oriented,” when deep down, the CEO just wants to snort coke off of a hookers ass, but does that mean that being “family oriented” is a lie? Does that mean that husbands should immediately start cheating on their wives and beating their kids, because the CEO of Radio Shack doesn’t actually care about family?

See, there are ideas, and there is politics. If you are discussing politics, you probably aren’t discussing an actual topic worth the discussion. Politics is freakin soap opera, nothing more.

I don’t care if Count Chocula stumbles upon a great idea in the process of figuring out a way to rape kids. If it is a good idea, it is worth repeating.

tkwelge March 28, 2011 at 9:57 pm

Why’d you take away my “edit” option! Damn you!!!!!!

tkwelge March 28, 2011 at 10:05 pm

I mean that it is good to repeat good ideas, not the raping of children. Hope nobody jumped to that conclusion…

John Dewey March 29, 2011 at 9:22 am

tkwelge: “Companies often pretend to be “family oriented,” when deep down, the CEO just wants to snort coke off of a hookers ass”

Why do you write this crap? Please give some examples of large corporations which you believe are “pretending” to be family oriented. Please tell us how you know what their CEOs wants. Do you personally know any CEOs of large corporations?

tkwelge: “because the CEO of Radio Shack doesn’t actually care about family”

Do you know Julian Day, CEO of Radio Shack? Do you have any evidence the man does not care about family values? If not, why do you write libelous statements about the man?

emerson March 29, 2011 at 11:35 am

John, relax.

John Dewey March 29, 2011 at 11:54 am


I’ve personally known several CEOs and COOs of large corporations. My wife’s uncle was one. I have no intention of letting anyone get away with unfounded slurs such as that posted by tkwelge. I could care less if my defense of these fine men bothers you.

roystgnr March 29, 2011 at 4:57 pm

At some point while reading, at least by the time he started calling Count Chocula a child rapist, everyone was expected to have figured out that the scenarios being posited were hypothetical rather than literal.

tkwelge March 29, 2011 at 6:11 pm


tkwelge March 29, 2011 at 6:11 pm

roystgnr is right. I’m not sure why John took everything so literally.

John Dewey March 29, 2011 at 7:35 pm


I do not believe this statement by tkwelge:

“Companies often pretend to be “family oriented,”

was hypothetical, nor do I believe he intended it to be. When tkwelge wrote that “family oriented” companies were only pretending, he really did piss me off. I’ve devoted most of my life to three such “family oriented” companies, and I know damn well that they are not pretending.


The CEO of Radio Shack deserves better treatment than you afforded him. If you wish a statement about a CEO to not be taken literally, then do not libel a real CEO.

You need to stop your disparaging remarks about corporations and CEOs. You only reinforce the ideas of people such as muirgeo, and you plant seeds of distrust in those who have never worked with or met real corporate leaders.

tkwelge March 30, 2011 at 1:19 am

Dude, this is getting pretty surreal.

David R. Henderson March 28, 2011 at 6:57 pm

Oops. Math error. Approximately 500 times, not 5000 times.

Bob March 28, 2011 at 7:03 pm

Don, You, Russ and your GMU colleagues are schills. Schills for Freedom, Liberty, Knowledge and Common Sense. Ideals you should be proud to represent as you do in such a educating and entertaining manner. I don’t get all the animosity that is directed towards the Kochs from within the libertarian movement. At a time when so much attention is being directed at Austrian School Economics and Libertarianism it would be a shame to waste this opportunity to persuade people due to petty partisan bickering.

vikingvista March 28, 2011 at 8:38 pm

“I don’t get all the animosity that is directed towards the Kochs from within the libertarian movement.”

Mises.org recently posted an article about a Koch-Rothbard feud. Maybe that has something to do with it.

E.G. March 28, 2011 at 9:04 pm

Hmm…the revolution eating its own? The problem is when you get to become such dogmatic ideologues as the people at Mises.org, you become a self-defeating caricature of Trotskyites. Everything is the enemy, everyone is a counter-revolutionary, everything is statist, and ideal perfection exists only in the written works of the masters.

tkwelge March 28, 2011 at 10:18 pm

I peruse Mises.org a lot, and I don’t think of myself as a caricature. Okay, the mises institute, actually the Rothbard institute, I should say, has some strange ideas, but there is certainly a lot to what is said there.

E.G. March 28, 2011 at 10:57 pm

There is certainly a lot to what is said there. I’m not attacking the ideas per se. But that still doesn’t resolve the potential problem that those people act like ideological demagogues that splinter into infinite factions, which will attack and denounce any other faction that fails to quote a particular Dear Leader correctly. You can take even reasonable and admirable concepts, and when you treat them with religious zealotry, you end up with serious dangers to those same reasonable ideas. There’s very little room for “conversation” at Mises.org…just a lot of shouting at “statism”.

Mao_Dung March 28, 2011 at 7:13 pm

I don’t give a hoot who the Coke brothers are or how they made their inherited, accumulating billions whether it was by selling Crack Coke or owning Coke stock. Their influence in society is due to their ability to spend some of their vast billions of dollars in influence peddling. Their fascist ideas are old hat and anathema to the lives of ordinary people. I would dispossess them in a heartbeat if I could and put them out to pasture, literally, to pick strawberries in the fields of Oxnard.

Of course, the Coke twins tyrants are aware that their undeserved, unearned vast wealth is always subject to confiscation if thinks get bad enough for a revolution in society like what we see happening in the Middle East. That is why they INVEST in propagandist protection from shrill, shill “think tanks,” and fake political movements like the Tea Party. It’s all about control of the media and the government to protect their sterling status quo of unbounded riches.


carlsoane March 28, 2011 at 8:22 pm

Excellent post. The Strawberry Fields video nicely reinforces your carefully reasoned position.

Mao_Dung March 28, 2011 at 9:15 pm

I wanted you to know what the working conditions would be like for the Coke twins when they reach the strawberry fields. I suppose I could have link to the latest Brooklyn bribery scandal instead. You take your pick, okay?


E.G. March 28, 2011 at 9:06 pm

“their undeserved, unearned vast wealth”

??? Dare I ask?

Keith March 28, 2011 at 9:14 pm

“their undeserved, unearned vast wealth”

they uh…inherited it from their dad…

E.G. March 28, 2011 at 9:20 pm

They inherited the company, not the wealth.

Anotherphil March 29, 2011 at 8:46 am

their undeserved, unearned vast wealth”

??? Dare I ask?

No you may not, just as you may not ask about George Soros.

Sam Grove March 28, 2011 at 9:12 pm

PIP; stinking up the place.

Dave March 28, 2011 at 9:40 pm

I’m just curious: how, specifically, would you label the Koch brothers’ ideology as “fascist”? The fascists did not advocate for smaller government and more individual liberty; rather, they were all about less liberty and a government more intrusive on markets. Government compulsion and individual liberty are opposites.

Mao_Dung March 28, 2011 at 9:59 pm

Since the term “fascism” has such an extreme negative connotation, fascists had to come up with a new word, ergo “libertarianism.” There is freedom alright, but it’s only if you have enough money to buy it. It is freedom for an elite minority of property owners with vast economic interests. True freedom would require egalitarianism which libertarians oppose. The belief that the Coke brothers foster is to blame government for taking away your freedom. This is true only to the extent that the rich and powerful manipulate government to further enslave you, such as by taxing you to pay for government services that the rich should be funding all by themselves.

tkwelge March 28, 2011 at 10:44 pm

“True freedom would require egalitarianism which libertarians oppose. ”

True freedom requires force and coercion.

Next, you’re gonna tell me that war is peace, right?

Mao_Dung March 28, 2011 at 11:01 pm

That “force and coercion” tripe is getting old. You are forced to go to work every day to pay your bills. Now, that is force and coercion on steroids. You think you are free to quit your job; you are all also free to starve and freeze to death in the backwoods. You’re not FREE to do anything without money. That libertarians are for freedom is a pile of horse manure; they are for the exclusive freedom of the well-to-do.

vikingvista March 28, 2011 at 11:47 pm

“You are forced to go to work every day to pay your bills. ”

O my God! This stuff is great! All you guys need now is to add “heh-heh heh heh” and “Uhhh huh-huh huh-huh. Cool.” to your comments and it will be perfect!

Sam Grove March 29, 2011 at 12:00 am

I’m forced to eat and drink to live.

Don’t expect any nuance from this one.

tkwelge March 29, 2011 at 2:13 am

“You’re not FREE to do anything without money.”

It is not “freedom” to seize other people’s property arbitrarily. You must convince somebody that you deserve the resources that they offer. Money makes this system work effectively. I suppose that you believe that people should be able to walk into a store and just start grabbing things off of the shelves?

SaulOhio March 29, 2011 at 5:59 am

The value of Mao Dung’s comments are well described by his last name. He is dredging up the usual anarchic concept of freedom, that anything that prevents you from doing something you would like to do is a violation of your freedom. I suggest reading Reisman’s passage on the subject of the anarchic concept fo freedom in his Capitalism book.

crossofcrimson March 29, 2011 at 11:36 am

“You are forced to go to work every day to pay your bills”

Choice is force, life is death, etc.,etc.,etc….

Dick Fitzwell March 29, 2011 at 2:04 pm

“You are forced to go to work every day to pay your bills.”

I agree with ya. Seriously I hate it when the government goons show up at my house in the morning and rouse me out of bed and into their car and whoosh!!! Off to work I go!

Keith March 28, 2011 at 10:56 pm

Libertarians, as well as ignorant conservatives, are like religious atheists. They vehemently believe that doing absolutely nothing is the answer to everything. They must know where to find some really good acid.

vikingvista March 28, 2011 at 11:45 pm

“They vehemently believe that doing absolutely nothing is the answer to everything.”

You guys are a laugh riot! I haven’t had this much fun since “Beavis and Butthead”.

Mao_Dung March 29, 2011 at 1:50 am

You are correct. In general, they are ostriches with their head in the sand with respect to oil spills, global warming, insider trading, offshore tax havens, nuclear plant meltdowns, taxes on the rich, etc. Leave it to libertarians to destroy the planet in the name of freedom of action. It is a corrupt philosophy that is ill-designed for the real world or for the advancement of mankind. Libertarianism is to political economy what a nuclear meltdown is to a nuclear reactor. Death and destruction are the inevitable results of both.

tkwelge March 29, 2011 at 3:08 am

WOw, what an ass hat. The libertarian answer is not to do “nothing.” The libertarian answer is simply that the government is not the answer to every problem, and in fact, it has been verified to be the source of lots problems.

Oh yeah, I know where to find some really good acid too. Fucker.

tarran March 29, 2011 at 9:33 am

And far too many people, never having experienced society where these institutions or social needs were provisioned voluntarily rather than by the state, are left ignorant of any idea that that is even possible. And so, when they are warned that Medicare and Social Security threaten economic ruin, they think that the speaker is contemplating casting the old and sick out on the street to die. When they hear a call for the abolition of govenrment schooling, they imagine the speaker must want the broad mass of children to be left uneducated. When they hear the call for the end of medical licensing or pharmaceutical regulations, they imagine that people will be subjected to all sorts of quackery. When they hear a call for an end of standing armies and the purchase of expensive weapons systems, they imagine that the speaker must naively want to invite a tyrant to waltz in and take over.

Too many people, no doubt from their experiences in schools where the classrooms are presided over mostly benevolent dictators called teachers, assume that society must be arranged in a similar vein, with leaders who make and enforce the rules, where there is no right of refusal or exit.

In the end, though, while it can commandeer impressive resources, and thus accomplish mighty things, the state invariably consumes more and produces less than organizations that it replaces. It replaces the civilization of people voluntarily bonding together with the barbarism of compelled relationships, compelled production and compelled trade.

Government Is Not Society by tarran

crossofcrimson March 29, 2011 at 11:39 am

“They vehemently believe that doing absolutely nothing is the answer to everything. ”


“Socialism, like the ancient ideas from which it springs, confuses the distinction between government and society. As a result of this, every time we object to a thing being done by government, the socialists conclude that we object to its being done at all.

We disapprove of state education. Then the socialists say that we are opposed to any education. We object to a state religion. Then the socialists say that we want no religion at all. We object to a state-enforced equality. Then they say that we are against equality. And so on, and so on. It is as if the socialists were to accuse us of not wanting persons to eat because we do not want the state to raise grain.”

- Bastiat

yet another Dave March 29, 2011 at 12:43 pm

Libertarians, as well as ignorant conservatives, are like religious atheists. They vehemently believe that doing absolutely nothing is the answer to everything. They must know where to find some really good acid.

Excellent example of absolutely zero comprehension of what you criticize – are you muirgeo posting under a different name?

vikingvista March 28, 2011 at 11:44 pm

“fascists had to come up with a new word, ergo “libertarianism.””

That’s the best laugh I’ve had all day.

Mao_Dung March 29, 2011 at 1:52 am

You laugh like a small-minded little fascist.

Anotherphil March 29, 2011 at 8:54 am

Naming yourself after a mass murderer with nary a thought to how “Dung” translates is ironic given the smug moral superiority.

NotHere March 28, 2011 at 8:17 pm

Honestly I have never even heard of the Kochs until recently, when the American conspiracy theorists decided that people supporting dated concepts such as freedom and capitalism could only be possible if there was a sinister force misleading them.

Since I am not American, am I also being misled by them or are there other sinister people who would brainwash the innocents with their dangerous ideas about liberty ?

jesullivan March 28, 2011 at 9:38 pm

The Koch’s are not pro-business; they are libertarian.

Capitalism, to be debated, must first be defined to the satisfaction of the antagonists. It is, philosophically, the outcome of economic activity and exchange under a legal system that recognizes and protects property rights to the maximum degree possible. Under this system, legislation, in virtually every case, is an encroachment on the rights of property in some form or another.

With this definition understood, one must realize that the capitalist, or businessmen, are not advocates of capitalism, per se. By nature, they are monopolists. When they advocate capitalism, it is only because they’re not powerful enough to be monopolists. They seek legislation to help them, of course, but they don’t want to eliminate private property altogether. Capitalism becomes the next best alternative for them. Similarly, the anti-capitalist crowd (the left) seeks legislation to help them. Although the legislation sought varies between groups, the common thread, again, regarding all legislation, is that it violates strict property rights.

The distribution of wealth under a capitalist system is determined by the consumers. They reward the producers who they like, and punish those they don’t. They ‘freely’ vote with their dollars everyday without being forced to do something contrary to their self interest. The system is totally voluntary. No one can get rich through the politcal process because it would be illegal. The rich man could never steal his wealth because it was given to him through freedom of exchange.

The Political Left are quick to cite greedy capitalists who use politics to further enrich themselves, but if you define capitalism upfront, they shouldn’t be able to get away with indicting capitalism, because capitalism would prohibit legislation that secures economic advantages for people.

But surely, the Left doesn’t want a system whereby the consumers determined the rich and poor. They do not want a society where people are free to determine value and reward each other based upon what they do for each other. To be anti-capitalist is to be totalitarian.

Mao_Dung March 28, 2011 at 10:10 pm

“The Koch’s are not pro-business …”

How can you expect anyone to read your full comment when you start out with such a ridiculous statement?

jesullivan March 28, 2011 at 11:21 pm

Mr. Dung,

Did you happen to saty at a Holiday Inn Express last night?

Keith March 29, 2011 at 6:56 am

Dear Mr. Dung,
I now have two satisfying, convincing proofs for the non-existence of a (good) God:
1) John Lennon’s assassination
2) Libertarians.

But I can’t decide which type is worse: the completely ignorant American freedom bullshit philosophizer who thinks that translates into economic wisdom, or the intentionally intellectually dishonest ones who do understand economics and prey on small minds to do their corporate bidding. It seems easy to say the latter, but without an army of idiots the head douchebag is impotent!

Anyways, solidarity from one reasonable person to another.

Love from Keith

kyle8 March 29, 2011 at 7:06 am

John Lennon was a former leftist who had begun to embrace libertarianism before he was murdered. I find it interesting that you think people who beleive in personal freedom and free markets are stupid.

I suppose that if I were smarter I would think that team Obama, and Harrry Reid were doing a good job.

Keith March 29, 2011 at 9:18 am

Believing in unqualified “personal freedom and free markets” is like being a Miss America contestant who says she believes in world peace. Good for you guys and Miss Americas, I’m glad you have such pure, unadulterated hopes for the world, but it’s just not that fucking simple.

Keith March 29, 2011 at 6:50 am

Just a couple quick points, certainly not exhaustive but I’m pressed on time:
1) Your definition of capitalism clearly does not satisfy the antagonists, when it necessitates the fact that every piece of legislation past protecting property and enforcing contracts is an infringement of freedom.
2) “They reward the producers who they like, and punish those they don’t. They ‘freely’ vote with their dollars everyday without being forced to do something contrary to their self interest. The system is totally voluntary.”
Um…dead wrong…ever heard of demand elasticity? You should probably take an econ 101 class and get some basic mechanics straight before slogging in on a debate about the philosophy of economics. There are many goods that qualify as demand inelastic, which means that for a given % increase in price, the amount people consume decreases by a smaller %, because it is a good/commodity they need, and/or are limited in choices. By definition not completely free, not completely voluntary. PLEASE make an effort to understand basic economics.

kyle8 March 29, 2011 at 7:10 am

If that is your understanding of Econ 101, then you are in serious need for a refresher course. Demand for food is inelastic, we need food to live, but demand for any given suppliers food is perfectly elastic as long as there are other suppliers.

It is only with government intrusion that you can have a situation in which there are limited choices, either through nationalization of industry, or crony capitalism, or state sponsored monopoly.

Believe me when I say, in all sincerity, you are making a laughing stock of yourself with your ignorant rants.

Keith March 29, 2011 at 9:14 am

I know man, I’m laughing at myself knowing that I go to the joke of an economic school known as the London School of Economics, and would be so daft as to study economics here! Econ 101 was years ago, I’m on to advanced shit that goes way over your head. But anyways, unfortunately it is you who is the one making uninformed ideological points. You are flat wrong that anti-competitive markets, i.e. monopolies or oligopolies, only emerge under government intervention. These are instances of market FAILURE, note the word MARKET, which necessitate government intervention to correct these market inefficiencies. We’ll see who’s a laughing stock when you can’t find any economic literature that says monopolies or oligopolies occur only under government intervention. Sorry you quit learning econ not long after 101.

Keith March 29, 2011 at 9:21 am

You chose food suppliers, which are the econ textbook illustration of perfect competition, so of course their demand is perfectly elastic. But people buy shit other than food, dude. Open your brain.

crossofcrimson March 29, 2011 at 11:48 am

“But people buy shit other than food, dude”

Alright, let’s here some examples of what industries you have in mind that undermine his claim.

crossofcrimson March 29, 2011 at 11:49 am

or even *hear*

yet another Dave March 29, 2011 at 12:35 pm

Welcome to the cafe, Keith. I glad to see that you defend your assertions with rude and insulting arrogance. That’ll show ‘em.

Keep up the good work!

vikingvista March 30, 2011 at 2:10 am

Stop already! You are too much! “Beavis and Butthead do London School of Economics”! That would be hilarious! I only know one person who satirized morons that well… can it be…is that you Mike Judge?

jhodapp March 30, 2011 at 8:26 am

“I know man, I’m laughing at myself knowing that I go to the joke of an economic school known as the London School of Economics, and would be so daft as to study economics here! Econ 101 was years ago, I’m on to advanced shit that goes way over your head.”

For some reason I don’t believe that, you write with the poise and understanding of a freshman in high school, if even that.

Keith March 31, 2011 at 12:24 pm

DIRECTLY from one of my industrial organization course texts, by Jeffrey Church and Roger Ware, “Industrial Organisation: A Strategic Approach” (McGraw Hill, 2000). Available for free dl @ http://homepages.ucalgary.ca/~jrchurch/page4/page4.html

“Important theorem established by Shaked and Sutton (1983) for vertically differentiated markets: they show that in markets such as the one we have modeled, and allowing for unit costs to increase with quality, only a finite number of qualities will be produced, even if demand expands without limit. The reason is exactly as above: no matter how large the market is, any firm producing a quality “close” to an existing product will trigger such “tough” price competition that entry will be uneconomic. Producing a lower quality product will only generate sufficient demand when it is some finite quality below the quality of an incumbent producer. Shaked and Sutton call this result natural oligopolies because there is no tendency for the market to become more competitive with the size of demand, unlike the case of a horizontally differentiated market.” page 413.

Natural oligopoly. No government intervention involved whatsoever in that model.

So jhoddap and other economic experts here, are you smarter than high school freshman?

Keith March 31, 2011 at 12:32 pm

and by the way, jhoddap, my high school freshman writing was just published in the LSE economic society’s quarterly journal, appearing RIGHT after interviews with all three of this year’s nobel laureates in economics and one with the CEO of the UK’s Financial Services Authority. Suck on that unit, to quote the great Robert Downey Jr.

muirgeo March 29, 2011 at 9:32 am

The Koch brothers are not libertaarian by your definition and their actions.

In a libertarian society who gets to mine or drill for oil on public lands? Or how do we decide who gets those public lands if you are going to make them all private?

And isn’t it possible all the land will be privately owned by a minority of citizens leaving the rest to live in a system similiar to the old feudal systems. Doesn’t Hayeks road actually lead to serfdom?

Keith March 29, 2011 at 10:51 am


crossofcrimson March 29, 2011 at 11:51 am

“In a libertarian society who gets to mine or drill for oil on public lands?”

In a libertarian society if you incorporate your labor with the commons that effective area wouldn’t be “public” anymore. Welcome to the idea of home-steading.

Seth March 28, 2011 at 9:41 pm

Not to mention, even if you and all the others in these institutions were shills, that in itself does not make you wrong or right. Believing it does is faulty logic.

tkwelge March 28, 2011 at 10:01 pm

A-men brother. Thank you! The problem is that people today have discarded rationalism. I’ve actually been in discussions with people at the “anonymous” (yes, that anonymous) forum, and people argue with me tooth and nail that there is no reality that logic can ever uncover. Essentially, the only thing that you can do as a human is attach yourself to a tribe, and live for some utilitarian purpose as a cog in the machine, or face missing out on the potential of humanity.

Maybe some of you college types could help me out. How does a rationalist argue with a nominalist?

tkwelge March 28, 2011 at 10:03 pm

These people simply argue that there is no such thing as a universal truth, therefore discussing ideas and logic at all is pointless. This is why they put so much stake in who’s talking rather than what they are saying. To a nominalist, tribalism and utilitarianism are all that matters, even though those seem like goals which accept the idea of certain universal concepts, but hey, it’s not my philosophy.

Sam Grove March 29, 2011 at 12:02 am

there is no such thing as a universal truth

Is that a universal truth?

vikingvista March 29, 2011 at 1:26 am

That’s the dagger.

Richard Stands March 29, 2011 at 1:55 am


All generalizations are wrong.

Don Boudreaux March 28, 2011 at 10:03 pm

You can reason only with people who are reasonable. Those who are not are beyond reach.

tkwelge March 28, 2011 at 10:08 pm

I completely agree, but that kind of leaves me at an impasse.

Have you ever argued with a nominalist in an attempt to turn them to the view of rationalism? Can it be done?

Don Boudreaux March 28, 2011 at 10:15 pm

My evolved opinion – having endured this earthly vale now for nearly 53 years – is that H.L. Mencken was never more astute than when he observed that thinking gives most people headaches, so most people routinely avoid thinking (without, alas, realizing that they avoid it).

tkwelge March 28, 2011 at 10:23 pm

Truer words were never spoken. Glad to have caught you while you were also at the cafe.

jesullivan March 28, 2011 at 11:38 pm

Thinking is not really what rationalism means, when speaking of philosophy. The counter-enlightenment was a refutation of rationalism. These weren’t exactly non thinking people. I would recommend reading some of Isaiah Berlin for a full elaboration

We use reason as a device to satisfy our passions, our ego, etc. This is why the world can appear to be irrational, or why individuals can be thought that way.

The spontaneous rationalism that provides for order and civilization is our innate selfishness, and nothing else. We are incapable of true sacrifice where we aren’t ultimately making ourselves happy in the process. Once you grasp this, everything makes sense.

Read LaRochefoucauld “maxims” on self love and Mandeville’s “Fable of the Bees”, or google psychological egoism. We are not capable of constructing a rational society. All efforts are lame excuses for the consolidation of power. However, we are capable of pursuing our own interests in a rational fashion, and a byproduct of this selfishness is where, as this website so says…”where order emerges” or something like that. Good night.

tkwelge March 29, 2011 at 2:35 am


I completely agree with everything that you said. I also do not believe that I or Don were implying that rationalism=thinking and that a rejection of rationalism is a rejection of thinking.

I simply disagree with the total rejection of rationalism all together. It was only the pure nominalist view that I was attacking. I’m not an ideological purist at all. I also don’t believe in divine universals, but I do believe in at least a handful of natural laws. I also believe that unknown natural laws can become better known through logic and reason as well as observation. Observations are meaningless without logic and reason in the first place.

vikingvista March 29, 2011 at 1:25 am

“people argue with me tooth and nail that there is no reality that logic can ever uncover”

When you point out that particular self-contradiction to someone, one of two things happens: (1) You don’t hear from them again for a while because they are too busy exploring the whole new world you’ve opened up for them; or (2) You need to write them off, and move on.

Seth March 29, 2011 at 1:51 am

I don’t know enough to know about universal truth, but I do know that we let too much fallacious thinking exist without directly identifying it.

Prof. Boudreaux is right that reason works only with reasonable people. However, I encounter unreasonable people who simply haven’t heard the names of the fallacies they hold as truths. I’ve made progress with some by simply identifying each fallacy, attempting to explain why it’s a fallacy, sending them to the web to learn more about the fallacy and then challenging them to see if they can come up with a case to support their position that does not contain any well-known fallacies.

With this process, you rarely have to state a case beyond pointing out their fallacies.

jesullivan March 28, 2011 at 11:11 pm

Rationalism is subjective. What is rational to you might be irrational to someone else. Many great thinkers upon whom this site would admire didn’t believe in such a thing as universal truth as it pertains to human values or human purpose, nor did they view nominalism as a logical alternative. The existentialist and/or moral relativist would be the logical opposite of the believer in universal values, right and wrong, etc.

HL Mencken, for example, was an admirer of Nietzche, who did not believe in Universal Truth. In addition, the most tyranny inflicted on this planet was done under the name of universal truth. Classical liberalism, in general, was considerably more relativistic. Holders of universal values tended to be illiberal and intolerant. Consider Popper’s “Open Society” books which link the belief of universal values to closed societies. Also, you might want to read Eric Havelock’s “The Liberal Temper of Greek Society” (the name might be slightly different) where he contrasts the illiberal and authoritarian values of Plato and Aristotle to many other Greek philosophers and thinkers who were more open to the concept of an “evolution of values”. Also, Hayek himself would never argue for a universal truth. But thinkers like Leo Strauss did, and he would be for regulated markets in the name of universal justice, which boils down to just another fancy excuse to disguise authoritarianism.

tkwelge March 29, 2011 at 2:18 am

I completely agree that there is no universal truth that me and you are going to agree upon today. I still, however, believe in the superiority of logic and reason in interpreting the world around me. I’m not exactly a rationalist myself, but the complete rebuke of rationalism, to me, seems odd.

I definitely agree with Nietzche when it comes to discussions of “natural” rights and morality, and I definitely side more with the evolution of values concept. I did not mean to imply that I was defending rationalism as “the one true way.”

tkwelge March 29, 2011 at 2:29 am

I definitely believe that rationalist tools are more useful when discussing economics than other approaches. Even the observation that people tend to pursue different interests and can’t be expected to behave similarly is an observation that can be interpreted from a rationalist perspective.

We all know that men can not be completely generalized, but we can make generalizations about humanity that are logical. We can’t predict HOW men will act, but we can predict that they will indeed “act.” We can also realize logically that men will act to change a less desirable set of circumstances into a more desirable set of circumstances, even if we cannot predict exactly what will happen and how.

A hyper-nominalist must learn to accept some level of rationalism before they can think outside of their narrow view.

kyle8 March 29, 2011 at 7:18 am

Not sure how you came to libertarianism with that set of values. Nietzsche’s views seem almost designed to create the opposite.

I find the belief in a set of natural rights to be the cornerstone of any libertarian system.

If values are evolving, then the left is correct, and we libertarians are clinging to old outmoded ways of thinking, while the “values” of the masses have evolved to become socialist.

tkwelge March 30, 2011 at 1:23 am

Not necessarily. When values can be changed, even if many remain the same, it makes any top down value system irrelevant. It can’t possibly take into account each individual’s natural law when crafting its own natural law concept. Both rationalism and nominalism lead to libertarianism.

Richard Stands March 29, 2011 at 12:17 am

How appropriately collectivist to assume that libertarians are marching to orders from central planning businessmen. When your view of human action revolves around command and control, any individuals advocating everyone’s liberty must surely be controlled by diabolical puppet-masters.

muirgeo March 29, 2011 at 12:28 am

The Koch brothers are exactly the best real life example of why libertarianism is bullshit. These guys claim to be libertarian but use all their wealth to influence government policy. THAT’S exactly what will happen EVERY time you try to set up a libertarian form of government. It will not work. Any minimalist government will be taken over by such princes of wealth and wielded to their benefit and to the determent of all others.

Libertarian in practice = Kleptocrat

tkwelge March 29, 2011 at 2:20 am

“The Koch brothers are exactly the best real life example of why libertarianism is bullshit. These guys claim to be libertarian but use all their wealth to influence government policy. THAT’S exactly what will happen EVERY time you try to set up a libertarian form of government.”

Hey, do you guys remember that day when a “libertarian government” was implemented? Was I asleep?

muirgeo March 29, 2011 at 11:10 am

So you’re claiming there’s never been a libertarian form of government but you’re damn sure it would work great based on apparently NO DATA…. IF ONLY?

kyle8 March 29, 2011 at 4:44 pm

I don’t think a purely libertarian form of government would work very well. But I would sure like to see a MORE libertarian government than the rights denying, spendthrift, leviathan we have right now.

vikingvista March 30, 2011 at 10:15 am

Well, since libertarian =kleptocrat, I guess we have a libertarian government now.

Kevin March 29, 2011 at 8:38 am

“These guys claim to be libertarian but use all their wealth to influence government policy”

They don’t use all their wealth to influence government policy. To the extent that their wealth can influence policy, there isn’t a libertarian government. For more on the collective hard-on so many people now dutifully have for the Kochs, see http://www.weeklystandard.com/articles/paranoid-style-liberal-politics_555525.html

muirgeo March 29, 2011 at 4:09 pm

Wow, that made no sense.

crossofcrimson March 29, 2011 at 12:02 pm

In the vein of Roderick Long, I have to ask if you believe that trying to gain control of the “Death Star” in order destroy it would make you the “bad guy.”

But even if we assume that you’re right in the “Kleptocratic” nature of those who you seem to lament for trying to wrangle for control of the Death Stare, you still highlight the fallacy of your own argument – that as long as there is a such a tool to be used, you’ll have no choice but to acknowledge it’s ability to magnify human power, corruption, and ineptitude through its use. If you had perfect people in a perfect society we wouldn’t care who ran the Death Star….but then again, why would we need one at that point?

muirgeo March 29, 2011 at 12:31 am

Koch Brother kleptocracy documented;


1) Koch Brothers get their puppet Governor Walker in power
2) Governor Walker gins up a crisis
3) Democrats and Progressives take the bait and counter-protest on collective bargaining
4) Governor Walker will compromise on collective bargaining if the rest of the budget is passed as is
5) Bill passes, with trojan horse give-a-way to the Koch Brothers nested in
6) Koch Brothers will buy Wisconsin state-owned power plants for pennies on the dollar in closed unsolicitated bids for which there will be no oversight
7) Koch Brothers get the best vertical monopoly in a generation

kyle8 March 29, 2011 at 7:21 am

WOW, those guys are my heroes! They used their wealth and power to get what they wanted out of government!

And you don’t like that? HUH? well you know what the answer to that is ? LESS GODDAMN GOVERMENT POWER YOU DIPSHIT!!!

muirgeo March 29, 2011 at 11:13 am

NO IT IS NOT less government because we tried that and wealthy monopolies arose and took over that smaller government to their advantage and to the disadvantage of others. Read some history.

You guys are trying to re-invent the past;


Emil March 29, 2011 at 4:07 pm

Well we (or maybe rather they) did try more government over and over and over and over again. It always worked out the same way:
- poverty
- oppression
- violence

Every single time

tkwelge March 29, 2011 at 2:19 am

5) Bill passes, with trojan horse give-a-way to the Koch Brothers nested in
6) Koch Brothers will buy Wisconsin state-owned power plants for pennies on the dollar in closed unsolicitated bids for which there will be no oversight
7) Koch Brothers get the best vertical monopoly in a generation

There’s definitely more to it than that. Also, see my comment towards the top.

Daniel Kuehn March 29, 2011 at 6:17 am

When people make accusations like this about you, does it ever cause you to think twice about suggesting that Keynesian economists do what they do so that they can win favors from and influence in government?

I’ve always said on this Koch thing that (1.) who cares if people fund ideas they agree with, but more importantly (2.) they don’t have to pay someone to say what they want them to say – there are plenty of people who agree with them already. All the Koch’s do is pay specific people to say what they would have said otherwise.

kyle8 March 29, 2011 at 7:24 am

as to your assertion, you can use Paul Krugman as a perfect example. The guy used to be a sane, functional, economist with pro-market views.

But because of being paid by the New York Slimes and being courted by all the Democrat party hoi-poloi, he became a raving big government, anti market shill.

Methinks1776 March 29, 2011 at 7:50 am

Even before he made himself available to the hoi poloi, he was enamored with the Voodoo of Lord Keynes. But then, that is very Keynesian – as preached by Paul Samuelson.

Daniel Kuehn March 29, 2011 at 7:56 am

Well, Don never used those words but that’s precisely the sort of crap I wonder if people reconsider when they get the flip side of it and get accused (indefensibly) of just being shills for the Koch’s.

I suppose I have my answer from you at least.

Don Boudreaux March 29, 2011 at 7:43 am

Daniel: I’m not sure to whom your question is addressed, but if to me, I don’t recall ever accusing Keynesian economists generally of being political opportunists (as opposed to my accusing government officials of using Keynesian economics for politically opportunistic reasons). I’m pretty darn sure that most Keynesians are sincere in their belief in the correctness of that doctrine.

I accuse Keynesian economists of being bad economists, not of being, as a group, politically opportunistic. (I qualify using “as a group” because Keynesianism – like many species of economics – has its share of politically opportunistic folk.)

Daniel Kuehn March 29, 2011 at 8:09 am

Well perhaps I’m making it up in my head, but it seems to be a suggestion that you hear a lot – Keynesians are rent seeking. Keynesians make the claims they do to please the government. Romer has sold out to the government. Summers has sold out to the government. It’s a fairly common swipe by people who claim to be speaking for a sort of public choice theory, that I would hope people would be more circumspect about after getting identical accusations regarding Koch affiliations. You seem to reject the view, though – which I think is good.

Methinks1776 March 29, 2011 at 8:14 am

It’s not identical, DK. Once in government, Romer pushed roughly the same policies her own research showed didn’t work and probably prolonged the Great Depression. Not every Keynesian is a rent seeker, but that doesn’t mean that some aren’t.

Daniel Kuehn March 29, 2011 at 8:22 am

Romer: “I wrote a paper in 1992 that said that fiscal policy was not the key engine of recovery in the Depression. From this, some have concluded that I do not believe fiscal policy can work today or could have worked in the 1930s. Nothing could be farther from the truth. My argument paralleled E. Cary Brown’s famous conclusion that in the Great Depression, fiscal policy failed to generate recovery “not because it does not work, but because it was not tried.” The key fact is that while Roosevelt’s fiscal actions were a bold break from the past, they were nevertheless small relative to the size of the problem.”

A lot of people seem to feel comfortable telling Romer what she thought and less interested in actually reading what she wrote.

Methinks1776 March 29, 2011 at 9:57 am

DK, I realize that the Church of Keynes believes that nowhere were stimulus has ever been tried was it ever big enough. Only in the Soviet Union was it ever big enough and it was applauded by prominent Keynesians long after the sheer misery of such a regime became public knowledge. After all, though we lived in shit, we were all fully employed (mostly acquiring basic necessities) and some of the city hospitals not only had running water, but we also sometimes had hot running water. That’s all that matters.

I’m talking about her work on taxes vs. her public comments on taxes once she joined the Obama administration. The academic work alone may make her a terrible Keynesian. There are plenty of hairs for you to split there. I’ll leave that to you.

AnonymousPundit March 29, 2011 at 10:10 am

@ Daniel Kuehn:

It’s truly sad that I have to begin this comment this way, but thank you for being an intellectually and philosophically honest commenter. I would expect that the vast majority of people on this blog would act in such a manner, but alas, we are saddled with obnoxious and shallow intellectual midgets like muirgeo and dung. I don’t agree with much of what you have to say, but you approach econ in a logically consistent manner in good faith.

Re: Romer

I am not a Keynesian or neo-Keynesian, so I don’t place much faith in aggregate demand. However, as I understand it – and I am willing to admit that I may be wrong – she advocated tax cuts as a much more efficient form of stimulus than government spending in “THE MACROECONOMIC EFFECTS OF TAX CHANGES: ESTIMATES BASED ON A NEW MEASURE OF FISCAL SHOCKS” (2007). However, when she became chairman of the CEA, she became head cheerleader for a program that flatly contradicted her own research and policy recommendations.

Daniel Kuehn March 29, 2011 at 10:43 am

Anonymous Pundit -
So it’s been a little while since I read the tax paper, but I just reviewed it to confirm my recollection.

She concludes here that cutting taxes improves growth. Not surprising, of course. Any Keynesian would tell you that. What she does is look at the impact of exogenous changes in taxes. Some, like David Henderson, have misunderstood that (http://www.forbes.com/2009/01/07/romer-obama-stimulus-oped-cx_dh_0107henderson.html). He writes: “The Romers’ research actually undercuts the Keynesian approach in a more fundamental way. They find that tax cuts to offset a recession are ineffective, but their reasoning would also apply to government spending increases to offset a recession.”, and I think this is the picture of Romer’s paper that a lot of people who get their economics from the blogosphere have imbibed. She does not say in the paper that tax cuts to offset a recession are ineffective (and thus, that stimulus is ineffective). What she says is that tax cuts to offset a recession are endogenous and therefore can’t be used to provide a multiplier estimate. That’s why she looks at other tax changes. And of course, she finds tax reductions stimulative. This is outside the context of recessions. Keynesian theory suggests that tax cuts will be more stimulative in recessions than outside of recessions.

I skimmed the paper again and did several word searches and can’t find anywhere (and can’t remember anywhere) where she says that tax cuts are a better stimulus than spending increases. She talks about spending as a control, and doesn’t even attempt to construct an exogenous spending indicator (the way, for example, that Barro or Ramey and Shapiro do). So I would dispute this point that she is somehow comparing tax and spending policy.

Indeed, she seems to rely on the assumption that spending is stimulative when she raises concerns about the endogeneity of tax policy. On page nine of the 2007 draft of the paper that’s up on the Berkley website she writes: “We feel that it is reasonable to assume that policymakers understand that the spending change will tend to
push growth above normal if they do not make the counteracting tax change
. Therefore, this is, in effect,
a tax change aimed at keeping growth normal. Classifying such a spending-driven tax change as
endogenous is crucial because the tax change is clearly correlated with another development, a spending
change, that is likely to affect output.”
It seems odd that they would cite an argument for why they were motivated to isolate exogenous changes in taxes if the paper itself disproved that assumption.

This paper really isn’t about taxes vs. spending. It’s about growth and taxes, and it’s a good paper because it’s cognizant of the endogeneity of tax policy.

I’ve only read three of Romer’s papers – this one, the monetary one on the Great Depression, and the one on volatility before the Great Depression. So I’m no expert one her work, but I’ve read enough to know (1.) the chattering class distorts it, (2.) she’s a good economist that does my alma mater proud, and (3.) she’s been consistent in and out of the Obama White House, as far as I’m able to tell.

Daniel Kuehn March 29, 2011 at 10:44 am

And anonymous pundit – by all means let me know if I’ve missed anything. I’m just going off of recollection and a quick review, but if she said anything more definitive about a comparison of tax and spending policy in the paper, let me know.

Methinks1776 March 29, 2011 at 10:49 am


What did Romer say about the effect of tax rate increases during the Great Depression? What does she say now?

kyle8 March 29, 2011 at 8:58 am

I am pretty sure that those people you mentioned are BOTH wrong headed in the policies they beleive, AND shameless rent seekers and shills for an increasingly fascistic administration.

But I only say that because they work for the totally corrupt Democratic party. The party that has brought us the partial nationalization of the financial and auto industries and the total nationalization of the health insurance industry. Record deficits, another war, and rampant union thuggery.

Daniel Kuehn March 29, 2011 at 9:43 am

To be fair, the first two partial nationalizations were a team effort.

John V March 29, 2011 at 1:13 pm

Well, for my part, the way I have put it about Keynesians and government is more like this:

The economics profession in terms of influence in public affairs and professional advancement would not be as attractive without Keynesian economics. Keynesian economics allows for more usefulness in public policy since the methodology is conducive to the implementation of many complex remedies.

In a way, it’s like the difference between a medical doctor and a wellness practitioner.

John V March 29, 2011 at 1:14 pm

As for the Koch brothers, I think it’s false equivalence to equate advocating for less government intrusion and advocating for more government. They are not two sides of the same coin.

Seth March 29, 2011 at 12:22 pm

Likewise with Keynesian economists, I care little about motivations. I’m mainly interested in the strength and evidence supporting their arguments and those against. Going after someone’s credibility may be cathartic and self-satisfying, but it does nothing to advance the discussion. The line of reasoning is a combo fallacy – forms of ad hominems, red herring and a straw man usually.

Methinks1776 March 29, 2011 at 1:28 pm

I don’t much care what Krugman’s motivations are. I don’t care about Romer except that she plays a different tune while working for Obama than when she’s working for Berkley. That’s not cathartic or self-satisfying. I find nothing satisfying about Economists pandering to politicians because I (along with you) am the one who has to pay for it. If we’re poorer for it, does it matter to you what the motivation was?

E.G. March 29, 2011 at 10:07 am

“6) Koch Brothers will buy Wisconsin state-owned power plants for pennies on the dollar in closed unsolicitated bids for which there will be no oversight
7) Koch Brothers get the best vertical monopoly in a generation”

Oh wow! The “power plant” story again! These “power plants” are backup generators for state-owned facilities, which are crumbling money losers which the state is desperately trying to get rid of. All together they amount to insignificant peanuts of actual generation (and are IMPOSSIBLE to actually be used for generation, since they service specific facilities, and often not even in the provision of electricity!)

Yet your fantasies are so ridiculous that you think that by “owning” some backup generators in a prison, in a mental hospital, or a redundant backup heating plant in UW Madison (which is now already replaced in operation by another plant)…they will get “vertical monopoly!” Monopoly on what?

This is the danger of people who are as ignorant as you Muirgeo getting info from the teenagers who write blog entries at Huffington Post or wherever you read that garbage. You heard the word “power plant”…and assumed…”power plant”.

nailheadtom March 29, 2011 at 10:27 am

Just as publicity for an upcoming baseball game wouldn’t just mention the Yankees versus the Red Sox but would stress “Derek Jeter and the New York Yankees face Adrian Gonzalez and the Boston Red Sox”, statists feel that demonizing personalities is a more effective means of presenting their arguments than arguing the case based on its merits. It’s much easier intellectually to oppose an individual or group than to oppose a concept or philosophy.

Prevalent March 29, 2011 at 12:35 pm

In addition to being two of the world’s 937 billionaires, aren’t the Koch’s hated because they control a privately held company? They are number two on Forbes list again this year. A lot of what’s still good about America is on this list IMHO.


jesullivan March 29, 2011 at 5:21 pm

Someone earlier asked that ‘wouldn’t Nietsche represent values the opposite of libertarian values?’ And it was also mentioned that if there is an evolution of values, then we are evolving toward egalitarian values. I will answer both of these questions here, and also place into perspective the roll of ideology as it pertains to human nature. But first, regarding the negative posts about the Koch family, I don’t know enough about them to comment, but for anyone to say that libertarianism is kleptocracy is foolish and ignorant. It is the only ideology that isn’t based on theft, whereas, egalitarianism is based entirely on theft.

I happened to have written a short book on philosophy and poltical economy that dealt with an evolving society. I self published it and never made an attempt to market it. I originally became a libertarian in my 20′s when I started reading Austrian Economics, but as I got older and wanted to strengthen my arguments, I took to philosophy. It was a hobby and the reason why I made a book was solely to organize my thoughts and conclusions regarding the topics I studied over the years. The book is called “Notes from the Aboveground”, and it’s highly provocative.

During this philosophical journey, eventually, I could no longer identify myself as a libertarian, or any other creed for that matter. If anything, I became an existentialist. That said, that didn’t mean that I thought that the libertarian legal structure wasn’t optimum for society. I still think it is.

The provocative nature of the book is that I logically show that no one is libertarian or egalitarian. Instead, we are all, individually, totalitarian. This was the position held by Nietzsche, and even his follower, Mencken. Of course, some people are leaders and others followers, so some might start a revolution while another provides the ideas.

The ideology that we claim to possess is just an affectatation (often a mere posturing). It’s hypothetical–which means there is no actual downside risk to holding the belief, and, if anything, is only representative of what might be available to us to margianlly improve our earthly circumstances. Thus, libertarians are typically bright capable people who do well under conditions of free human competition anchored to the protection of their property. Egalitarians aren’t as capable. They’re typically more envious and seek to take from the social groups ahead of them. In common, both use their ideology (belief system) as excuses to protect or slightly impove their circumstances, and the ideology is the “excuse” that lends moral creedance to what they are trying to do.

A person will throw out his libertarian beliefs if greater power were afforded him, and often, the egalitarian who votes to fatten his wallet will suddenly discover a new found appreciation of property rights once he has some of his own.

Now here’s the tricky part. Our nature is and has always been totalitarian. Our nature is not evolving, per se. We aren’t evolving to be something different than selfish. All species survive based our their total egocentrism. Human concepts of altruism are ideological devices created by the powerful to thwart peoples ambitions that subside below them. They have to do with ‘belief’, not nature.

What evolves is ‘belief’, or ‘values’, or what is known as ‘ideology’. Man always acts to maximize his ego–he wants to feel good about himself, be loved, respected, etc. He has emotions such as pride and shame, among others, that display how he is feeling about himself. These emotions are entirely determined by the prevailing set of values in society at any given point in time. Our ego seeks mainly the approval of others, so we have to do things that they believe are proper and right. Our emotions (pride and shame) are conditioned through education, at an early age, to a certain set of values. Without that conditioning, we’re just vicious animals.

But what or who determines values? The rulers of society establish the values that the future generations are educated to believe, through custom, and to subsequently feel pride and shame when depending on how their behavior is judged in realtion to those values. It is the belief in the rules of the rulers by the masses that make peace and order possible. Look at every society in history and you will see that the belief system upholds the power apparatus, and people are shamed for encroachments upon the status quo.

Who are the rulers and how do values evolve? The rulers can be a small minority or a vast majority, and in each case, the values underwrite the prevailing order. But since we are all totalitarian, by nature, there is tension in every society for some new groups to increase their power within the matrix. These groups use ideas to justify their quest for empowerment, and if they succeed, their ideas that justified thier ambition become included in the value system too, and go on to eventually become custom. So, only as power is diffused and held by increasingly larger and larger segmets of society, do values change to justify and teach the future generations that they represent justice. So values and justice are relative concepts invented and tought by the rulers of society for the sole purpose of appeasing the masses to observe the prevailing power structure within the society.

In our society, libertarian values dominate private life–as people demand more equality under law in their private dealings with others. These values evolved as people became equally empowered. They weren’t invented by dictators. No ruler would prefer a libertarian society to an authoritarian one.

The egalitarian values are more common in the political realm. You can’t go to your neighbor and demand half his paycheck, but you can vote it away from him. In the political realm, power is not as equally shared and we experience more theft between groups using the democratic process.

The ideologies emerge to reflect the interests of groups of individuals with common aspirations for improving their circumstances. The slave who seeks his liberty is no different than the freeman who seeks to enslave someone. In fact, history has clearly shown them to often be the same people, but only at different times and under different circumstances.

My conclusions were mostly drawn from Nietzsche. He grasped human nature the best. Ayn Rand was a libertarian, but to Nietzsche, she wouldn’t be much different than Karl Marx. This is because both Rand and Marx merely differed as to degree, or when man should cease being selfish! Marx wanted man to cease being selfish for the common good–at an egalitarian limit. Rand wanted man to be selfish up to the point of “contract”, and then become passive about futher empowerment if it meant a breach of contract. Nietzsche’s philosophy argued that human nature can’t do either. Man would breach contracts if he could and he would use his wealth in politics to imporve his economic status—as he should, by his nature!! Further, he sneered at the hypocrisy of the egalitarians who couldn’t live a moment of their lives under that ideology if they didn’t have to.

Nietzsche claimed that what made a man a libertarian was not himself, but another man with equal power.

E.G. March 29, 2011 at 7:45 pm

Not that I don’t appreciate your efforts, but to my primitive engineer’s mind…philosophy is a 16 paragraph attempt to explain the obvious conclusion that everyone else had already arrived at hours ago, but make it so incomprehensible that the other people will think they got it wrong the first time.

But I do especially like your last paragraph, and is the main reason I’m not a fan of certain “libertarian” creeds.

jesullivan March 30, 2011 at 8:42 pm

What are you a fan of?

jesullivan March 30, 2011 at 9:15 pm

I don’t like most philosophy either. But where you’re wrong is in thinking that people arrive at the right conclusions. Most people don’t understand their own nature. I can turn what they say and believe against them using their own words.

In a few paragraphs, I can destroy the entire argument for the libertarian ethic. But to understand it, you’ll learn that your own beliefs are bullsh..t too.

vikingvista March 30, 2011 at 2:51 am

“Nietzsche claimed that what made a man a libertarian was not himself, but another man with equal power.”

That may be true as a historical development–as the reason people began contemplating such things as natural rights to begin with. But once stalemate led to agreement, the notion was discovered, and the obvious personal benefits of accomplishing interpersonal goals using agreement rather than conflict would naturally lead people to ponder the benefits of expanding the concept as a way to achieve even greater benefits. It would be a guide in a person’s life for making decisions that would lead him to such rewards. Thus a general principle is born.

“Rand wanted man to be selfish up to the point of “contract”, and then become passive about futher empowerment if it meant a breach of contract.”

That’s a faulty interpretation of even a run-of-the-mill businessman let alone Ayn Rand. People don’t often stake their entire reward on the hope that the counter party will honor the contract, or that a third party will forcefully enforce it. Typically the rewards both parties seek are from a long term relationship–a relationship that would be aborted if the initial contract were violated, leaving BOTH parties poorer than they expected. In other words, such relationships are ENTIRELY selfish.

jesullivan March 30, 2011 at 8:42 pm

The Principle you speak of only lasts as long as there is equal power backing it. It is merely derived from power. Where a balance of power doesn’t exist, either does the principle. But once it does exist, peoples emotions are conditioned to it. They are then able to have feelings of guilt that someone not conditioned to the principle wouldn’t feel.

I agree with a point made in your last paragraph, but you had a faulty interpretation of what I was tyrying to say. When it is in someone’s power and interest to breach a contract, they do unless they have been conditioned not to. But many people will overcome their conditioning, and do.

I have not misinterpreted Rand. I know her philosophy inside out. She wanted man to live by a libertarian principle. Fine. But we don’t if we can do better for ourselves. Just look at history and what’s going on in the world today as proof. A philosopher studies man as he is, not as he wants them to be. The latter is an ideologue, which describes Rand and Marx.

Lord Acton, a libertarian, understood my point. He said “Power corrupts and absolute power corrupts absolutely” The only difference between his view and mine is that I don’t think our human nature is corrupt. This so called corruption is vital for the survival of the species.

vikingvista March 30, 2011 at 10:01 pm

“The Principle you speak of only lasts as long as there is equal power backing it. It is merely derived from power. Where a balance of power doesn’t exist, either does the principle. But once it does exist, peoples emotions are conditioned to it.”

You still don’t understand the libertarian view, the nature of contracts, or economics. When presented with a choice between aggression and agreement, the latter is very often in your best interest, even if you have overwhelming power to force your will.

When I suggested that a stalemate of equal powers might lead two individuals to discover the value of agreement over aggression, that doesn’t mean a stalemate is the only time it is in one’s best interest. It just means that could be what it takes for two parties squandering their potential to realize the opportunity cost of their previous interactions. They discover that the principle DOES apply to and is appropriate for other nonequal situations. They don’t FORCE that principle into other inappropriate situations.

Human nature is to be self-interested. In that we agree. Where you are wrong is in thinking that voluntary agreements between unequal powers cannot be in the best interest of each party. This is an odd misunderstanding, since it is an everyday realization in the marketplace. Even outside the province of a common superior power, like between agents of different states, you also frequently see this. If you consider all of your own interactions throughout the day, you will probably find personal examples.

And of course, to most economists, this understanding regarding trade is second nature. Aggression is usually very costly. If people were to routinely start lying on their contracts and violently forcing their will, mass poverty would result, and the richest among us would take a painful hit.

jesullivan March 31, 2011 at 7:53 pm

I didn’t bother respond to your point because it wasn’t relevant to my point. I own a 30 milion dollar company. I am not ignorant of contracts and economics. I understand the principle of deferred gratification whereby parties to contracts and exchange see the long run utility of their relationships, but that doesn’t mean breaching a contract would be in their best interest. You described a scenario where the logical incentives were to honor contracts.

I was describing a scenario where the clear incentive would be to breach the contract. The utility derived from future transactions between them would be calcualted as less than what one of the parties could gain by breaching the contract.

You don’t get my point. If one tribe was clearly stronger than another, they conquered and enslaved the weaker tribe. This is how society and civilizations were born–conquest and exploitation. (Oppenheimer’s “The State”). Why would someone exchange with someone if they could enslave them? In past history, they didn’t. In some contemporary societies where there is still a marked imbalance of power, they still don’t.

The non-equal situations you describe refer to relative positions of bargaining power, which describe almost every transaction, but even in these, the people with the marginal advantage secure more favorable terms for themselves. My point is that in every transaction, people try to maximize their power, or gain. They use what power they have at their disposal. Getting away with not paying an invoice because of a legal technicality often happens when people think that they will gain from it, even though they’re basically ending the relationship with the entity that they’re screwing. But they calculate that they don’t need that entity, or could survive without it.

I have hundreds of customers and am in the metal distribution business. I know all about contracts and power. In the summer of 2008, aluminum ingot crashed. It went from $1.50 lb to about $.58 lb over 75 days. I was stocking millions of pounds of aluminum bought at high prices for my customers. I had contracts to sell it at the prices I was buying it for. None of that mattered. I was buying domestically and internationally and the situation in aluminum was similar to many other commodities. During that period, companies ripped up their contracts and sought to buy cheaper on spot markets. If I threated to sue my customers, I was the one running the risk that they would never buy from me again.

People maximized their power against me when they calculated that they could. It happened all over the world. The WSJ wrote many articles on the subject. If you study world events and economic history, you have to come to the conclusion that power over-rides everything else. Self interest means nothing without some type of “need” that you are providing others. That “need” is your power.

In your defense, you were describing a mutual “need” between people without realizing that I included that in my usage of the word power. Your “power” is what they “need” from you. Once you’re not needed, you’ll get screwed if they think they can clearly get away with it.

vikingvista April 2, 2011 at 5:07 pm

“If one tribe was clearly stronger than another, they conquered and enslaved the weaker tribe.”

I’ve reiterated that point to you myself. What you are missing is that ancient-style enslavement, it is now known, does not produce the best return for the conquerer. Even in the most power-imbalanced relationships–states vs subjects–agents of states have come to realize that their booty grows the more freedom they allow their subjects (to a limit, of course). In the modern age of the nation state, it is that realization to which we really owe the level of freedom people have now. China provides a stark example of this effect, since Party leaders only very recently came to that realization.

It is true that you get more value from having a slave, then not having a slave. But you get much much more value if you allow your slave to pursue some of his own productive interests.

The point is, again, there is a self-interest to keeping your “trading” partner happy, no matter how imbalanced the relationship. The aggressor pays an opportunity cost for his aggression.

“My point is that in every transaction, people try to maximize their power, or gain. They use what power they have at their disposal.”

You view libertarianism as some sort of utopian vision. I have never met a self-proclaimed libertarian who was like that. All understand that there was theft, murder, vandalism, kidnapping, and fraud in the past, and there will be in the future–no matter what. The libertarian believes that there is a better way for dealing with the whole spectrum of human nature than to leap straight to the feared result of a single brutal overwhelming power to lord over everyone.

And the philosophical justification libertarians give is not a plea for people to be pious–as you seem to describe Rand. It is a recognition that to each person, “better” means more personal power, and that interactions do exist which result in a subjectively better condition for both parties.

You may not pay an invoice to a supplier. That is not a rent in an emergent libertarian system. Almost certainly before he delivered product to you, he considered the possibility that you wouldn’t live up to your word. Perhaps your supplier will take your offense into account if an opportunity to trade with another partner–with a better record of paying his bills–arises. Or maybe he raises his prices. Or maybe he enters into insurance agreements, or combinations of the above. That, apparently, is all the punishment you merit, since that is all the relevant party cares to do. That is the kind of libertarian solution that is applied to real world problems.

You seem to think Rand wants the God of Honesty to part the clouds and wreak vengeance on the contract-violating sinner. For all her romanticism, and unequivocal prose, I think you misunderstand her.

I don’t want to completely agree with you that people do not restrict their actions according to selfless notions of piety. I believe there are ample examples where they do, often for ill. But pious restraint is not the foundation of libertarianism.

carlsoane March 30, 2011 at 9:50 am

“The slave who seeks his liberty is no different than the freeman who seeks to enslave someone.”

Would you say that neither is different from the abolitionist? How do you account for private charity?

If you allow for enlightened self-interest, which I believe you have to do, then you have rendered selfishness an innocuous term.

“So values and justice are relative concepts invented and tought by the rulers of society for the sole purpose of appeasing the masses to observe the prevailing power structure within the society.”

What is your evidence for this? I think the evidence is far more compelling that these concepts evolved as power became more diffuse.

jesullivan March 30, 2011 at 9:07 pm

It’s easy to take a position when it doesn’t affect you. That is what I meant by describing the action as ‘hypothetical’. There is no downside loss for the person holding the value. Whenever power is unequal, the weaker parties, throughout history, have typically recruited neutral observers to their cause. The neutral observers have often disliked the advantages accrued to the powerful and would love to see them weakened. If you study Machiavelli and how power was balanced throughout the middle ages, it’s easy to see how alliances were formed.

Thus, because of the cultural disparity that existed in the US in the mid-19th century, and because much of our population was being educated to values pertaining to human rights, enough people who didn’t own slaves felt safe enough to protest against those that did. Power was being diffused and shared. When it reaches certain levels, abuses of power become questioned. That is the history of the world. Our human story is the slow advancement of human liberty, or equal power between people.

Regarding acts of charity or altruism. One type of giver seeks recognition. For the other, it is more emotional. A person sees someone suffering and imagines that happening to them. This triggers a sympathetic response that usually fades away once it is over. As the saying goes…”out of sight, out of mind.”

Rand cruelly disparaged acts of altruism. This was another glaring example of her weak grasp of human nature. She didn’t understand that charity and altruism make people feel good about themselves, and is therefore just another manifestation of egocentrism.

Mao_Dung March 31, 2011 at 4:47 am

Here is more on the nexus among the Tea Party, Koch brothers and the business influence peddlers (lobbyists).


Tibor R. Machan March 31, 2011 at 6:24 pm

Frank Rich’s Prejudice

Tibor R. Machan

Karl Marx was famous for, among other things, claiming that everyone always promotes his or her economic interest. This is something he actually had in common with non-Marxists classical economists.

Most economists, in fact, believe that we are all motivated by our economic interests, nothing else. Or, rather, everything else that might appear to motivate us really comes down to economics. Consider the following from a few very prominent non-Marxist economists. The late Milton Friedman, one of the modern age’s most famous and diligent students and defenders of the free-market system, said it most directly: “[E]very individual serves his own private interest… The great Saints of history have served their “private interest” just as the most money grubbing miser has served his interest. The private interest is whatever it is that drives an individual.” His colleague, the late George Stigler, another Nobel Prize winner, made the point only slightly differently: “Man is eternally a utility-maximizer—in his home, in his office (be it public or private), in his church, in his scientific work—in short, everywhere.” Finally Nobel laureate Professor Gary Becker, who also embrace this homo economicus viewpoint, underscores the idea as follows: “The combined assumptions of maximizing behavior, market equilibrium, and stable preferences, used relentlessly and unflinchingly, form the heart of the economic approach as I see it.” The bottom line: We are all driven by our desire to fare well economically, first and foremost.

Marx also held to this idea, at least so far as people in the capitalist phase of humanity’s development are concerned. We act to enrich ourselves and whatever else we might claim motivates us, it is really just self-enrichment.

Frank Rich of The New York Times, who is a relentless foe of the free market, capitalist economic system, has just now latched on to the story of the brothers Koch of Wichita, Kansas, David and Charles–there is another who isn’t so directly involved in the Koch business enterprises–a story told extensively in The New Yorker recently, by Jane Mayer. Rich is very impressed by this story and interprets it in the way many economists would, namely, that everything done by the brothers Koch has to do with their desire to enhance their wealth. But the economists would say this about all of us, not the the brothers Koch.

Of course, Rich merely infers his claims from the story–he fails to give one solitary good quotation from either David or Charles Koch to substantiate his allegation that they are both interested solely in self-enrichment. No wonder, because it is not so.

I have had the good fortune to make the acquaintance of both of the Koch brothers, although we aren’t fast friends by any means. But way back when I was a graduate student in philosophy, Charles took an interest in my work on my doctoral dissertation and invited me to give a talk about it in Wichita. It had to do with human rights and whether we can know that there are such rights or do some of us simply have a strong feeling in favor of them. Later I served, briefly, on the board of the Reason Foundation (which grew out of Reason Enterprises, the tiny firm that published Reason magazine in its early incarnation) with David Koch. So I can attest without any reasonable doubt that what motivated and likely still motivates the brothers Koch is their firm commitment to the ideas and ideals of a fully free society, a la the Declaration of Independence.

Now it is often held by the likes of Frank Rich–such as Ralph Nader and Kevin Phillips–that those who favor a fully free society are only interested in promoting their own economic welfare. Is this credible?

No. Of course, true enough, a fully free society would also be economically free, just as it would favor religious liberty or freedom of the press or everyone’s right to, say, sing in the shower and marry whoever they want who would want them. Freedom for those of us who love it isn’t divided into economic, religious, journalistic, scientific and other parts. It is indivisible, a general proper condition for human community life, period. This is what the Koch brothers have always championed.

Now just like journalists who favor freedom of the press benefit from such freedom, the Koch’s naturally would benefit from freedom of commerce. But so would we all. Freedom, not surprisingly, is simply good for us all and this includes entrepreneurs such as the brothers Koch. Now do they–do we all who champion a fully free society–support liberty solely because it enhances our economic welfare? No, I am certain of that–I, who have hardly a dime to my name, certainly favor liberty in part because it enables me to earn a living with the support of those of my fellows who freely choose to pay me for my work. But is this the sole reason why I favor liberty? Is it the sole reason the brothers Koch do so? Wrong! Not by a long shot.

Just ask us. Don’t ask Frank Rich, who makes his claims based on his prior beliefs, independently of any evidence from the brothers themselves.

jesullivan March 31, 2011 at 8:07 pm

It was actually the Austrians, notably Mises, who explained that there is no such thing as what was called “homo economous” or “economic man”. Free market detractors accused market advocates of basing their theories on the premise that man always acts to maximize his monetary gain. The praxeological theory (Austrian) was based upon a concept of man always acting according to his highest valuation of possible choices, which were based on pleasing one’s self, or satisfying one’s ego. Monetary profit was only a type of satisfaction, so to define it more accurately, Rothbard, I believe, called it “psychic income”.

Tibor R. Machan April 1, 2011 at 5:24 am

Unless my memory fails me, Mises argued that everyone acts so as to alleviate one’s incompleteness or imperfection, from the unease that prompts one to attempt to fulfill what is lacking so as to be complete or perfect (which is why Mises was an atheist who held that God could not have acted to create the world since He is perfect and wouldn’t have any reason to act). It hasn’t got anything to do with money per se, but then neither does the neo-classical economist’s view of homo economics since anything could be one’s utility (it just happens that a fungible good like money can easily be transformed into this).

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