Taxes and political economy

[klapse]

"Hans Hoppe takes on the most difficult subject in economic and political theory: the provision of security. He argues that the service is better provided by free markets than government, while addressing a hundred counter-arguments."

http://mises.org/document/1893/The-Private-Production-of-Defense


An interesting read! Sorry for the offtopic. Back to the senseless price speculation.

I read the first paragraph or so and he already had some false premises in there, so I guessed it wouldn't be worth the time.

I am curious what "false premise" you refer-to. The premise of a sovereign ruler to provide security is the obvious status-quo.

 

[thatgui]

I am curious what "false premise" you refer-to. The premise of a sovereign ruler to provide security is the obvious status-quo.

Well, I'm still reading, but the first overall impression is that he tries to seperate the development of security from other cultural/social/"societal" developments, but seems to ignore that they influence each other. And while in the beginning he tries to explain and analyses Hobbes (and likeminded) concepts, he expands into a much broader definition of "security" afterwards.Not that I'm interested in an argument, just giving a first impression

 

[Granitehead]

I am curious what "false premise" you refer-to. The premise of a sovereign ruler to provide security is the obvious status-quo.

Hobbes according to Hoppe:"Put in modern jargon, in the state of nature a permanent underproduction of security would prevail.

Each individual, left to his own devices and provisions, would spend too little on his own defense, and hence, permanent interpersonal warfare would result."

No, the dominating problem is not that people would spend too little on their defence. It's that even if they spent all of their resources on defence, most of them wouldn't be able to stand up against a few other people attacking them at the same time. So there is no way around providing security in a kind of collective. Assuming an initial distribution of wealth like in America today, it would be tactically advantageous for the top percent or so to form one collective, because they could defeat the other 99% (in practice there would of course be more fractions at the beginning, for both the stronger individuals and the less strong ones, each fraction would contain individuals of approximately the same strength/wealth, but the groups consisting of stronger individuals could still beat much much larger groups of poor people. Given enough time this would lead to the same scenario, assuming there is a large enough portion of selfish people. I think that's a safe assumption). So then, after your brief period of anarchy, you get an oligarchy instead, where there is a strong collective (call it whatever you want) which can do whatever it wants.

"S can determine unilaterally how much A and B must spend on their own security; that is, S has the power to impose taxes in order to provide security \"collectively\"."

He then goes on to speak of S as a person, which seems to have all kinds of powers over A and B. Sounds more like a monarchy than a democracy to me. I guess it's an American thing to think like this, you with your crazy presidents. In Switzerland, we don't have one. There is no equivalent to a president here. Though our democracy is still far from the direct one which I would consider ideal. I would define S more like "An institution which must act according to the will of the majority of it's members. It has absolutely no choice of it's own and is completely dependent on it's members. To avoid having to do votes for every single action of that institution, it's members also decide on a set of rules which the institution needs to follow like a computer. (some of those rules need to be about the punishment and exemption of members of the institutions executive who don't follow the rules)". This is completely possible with modern technology, for a while direct democracy might have been impossible because of technology lacking behind population growth, but now it's possible again.

Don't get me wrong, I don't think there are any real S according to my definition (nor have there ever been such S), I think the status quo in most countries is something in between "sovereign ruler" and what I described. But there rarely is a really sovereign ruler in form of a single person (taken literally, that would be absolutism), mostly there are large groups of people who have varying degrees of influence on the actual decisions states take. Even the American president, though more influential than most, is still not a sole sovereign.

 

[klapse]

I am curious what "false premise" you refer-to. The premise of a sovereign ruler to provide security is the obvious status-quo.

...mostly there are large groups of people who have varying degrees of influence on the actual decisions states take.

While "S" was a monarch+small_bureaucracy in the precursor to modern states, "S" is a small clique of judges+large_bureaucracy in modern states. I see it as orthogonal/irrelevant to Hoppe's argument whether the formal head of State justice is a person, or a small clique of people (supreme court). The institution itself is conceived as having a monopoly of force (this is codified in the German consitution, for example).

For everyone who doesn't want to read the whole book: the basic idea is that competition in provision of services is a good thing. Hoppe argues that we are on an evolutionary path towards competition in the provision of security and justice, despite a still prevalent historical thinking that only a monopolist can provide them. He isn't the only economist investigating these issues, just one of the most apodictical.

 

[Granitehead]

I am curious what "false premise" you refer-to. The premise of a sovereign ruler to provide security is the obvious status-quo.

...mostly there are large groups of people who have varying degrees of influence on the actual decisions states take.

While "S" was a monarch+small_bureaucracy in the precursor to modern states, "S" is a small clique of judges+large_bureaucracy in modern states. I see it as orthogonal/irrelevant to Hoppe's argument whether the formal head of State justice is a person, or a small clique of people (supreme court). The institution itself is conceived as having a monopoly of force (this is codified in the German consitution, for example).

If it was irrelevant to him he wouldn't state"The difficulties with Hobbes’s argument are obvious. For one, regardless of how bad men are, S —whether king, dictator, or elected president — is still one of them. Man’s nature is not transformed upon becoming S"

and use that as an argument.

When you reason that way (and I do think we should, the nature of S is important), it's very important what S is. And S isn't just judges and a bureaucracy in modern states, it includes the executive, the legislative and factually also lobbyists. Indirectly, it includes the people of a democracy (A and B) . But the factual situation isn't really relevant to my argument, because I don't say governments like we have them today are ideal or even good, I just say that a theoretical anarchy is inferior to a (my) theoretical real democracy and thus people should rather fight for more democracy than for anarchism (aka liberalism).

 

[vcoleiro1]

WTF

 

[Glyph Reader]

WTF

My thoughts exactly (with less swearing, mind.) 

-Glyph Reader

 

[Natsu]

My thoughts exactly (with less swearing, mind.) 

-Glyph Reader

:lol:   Yeah, I pretty much gave up on this thread one page ago.

 

[Granitehead]

WTF

My thoughts exactly (with less swearing, mind.)

:lol:   Yeah, I pretty much gave up on this thread one page ago.

Then shut up and let the intellectual elite have it's discussion.

 

[klapse]

Sorry for the thread derailing.

When you reason that way (and I do think we should, the nature of S is important)

Ok, I understand your point: "Though S consists of fallible men, in a state with (even more) democracy, the laws made by S are influenced by A and B." Like you, I would probably enjoy seeing more direct, democratic influence of A and B in the decisions of S.

But what would give A and B even more influence into justice and defence would be letting them choose their provider. This may seem unthinkable today, but it was also once believed that a state needed a monarch to rule it. Democracy was once a radical idea.

Note that in our system of "S Justice", justice is slow and expensive -- there are high costs and damages incurred. This often leads to involved parties seeking private dispute settlement (like where Exophase pays Ryan 80-some dollars to prevent solving the dispute through "S Justice"). In addition private security firms are a growth industry in Germany and USA (don't know about elsewhere). So, already we see market solutions supplanting "S" solutions. Hoppe and others like Walter Block are considering the extrapolation of that trend.

Thanks for the insightful discussion.

 

[Granitehead]

I guess I'll need to read the book after all, otherwise I can't really continue to discuss it.

Will take some time until I find the time to do it, but I'll post my opinion on it here when I'm done.

 

[Caine]

Edit: When I say "restricting freedom" I think of stuff like the freedom to kill, the freedom to keep slaves, the freedom to steal, the freedom to exploit others in any way you want, etc., generally spoken, all freedoms people can possess which reduce the freedom of other people when used.

You really think restricting those freedoms is "punishing success"?

No I do not. Perhaps I misread what you mean with minimal freedom.
The basic premise is that everybody has the right to his own life, i.e. the right to be free from force, any force.

This ranges from not being allowed to harm or kill another, to not being able to steal the fruit of his labour (his posessions).

E.g. as a consequence of such a premise, progressively taxing higher incomes is unethical as it is a form of force

(by the poor majority). Note that the state employs force (threat of imprisonment) to force you to pay such taxations.

Likewise, employing ones wealth to deprive others from a chance to living is equally unethical.

It seems that any "-ism" breaks down by those who willfully try to sabotage it. From the lazy bastard who refuses to work in a

socialistic government and merely exist by leaching from those who do, to the corporate monopolist who who attains full control

over a critical resource (i.e. essential for life, e.g. food) in a laissez faire capitalism and uses peoples dependency on it

to effectively enslave them.

 

[bzar]

It seems that any "-ism" breaks down by those who willfully try to sabotage it. From the lazy bastard who refuses to work in a

socialistic government and merely exist by leaching from those who do, to the corporate monopolist who who attains full control

over a critical resource (i.e. essential for life, e.g. food) in a laissez faire capitalism and uses peoples dependency on it

to effectively enslave them.

Which of these do you consider to be the worse outcome?

 

[Binky]

The problem with full-on equal-opportunity capitalism (which sounds like a good idea) is that equal opportunity doesn't guarantee equal results.

Capitalist systems always spread out into the rich and poor. The rich always use their wealth to control the poor, and then your now-not-so-equal-after-all system starts veering off towards slavery (much as it did in early Victorian industrial Britain)

---

The problem with full-on equal-wealth social/communism (also sounds like a good idea) is that promises of power and luxury are pretty much the only things that will make the population work hard.

Without an industrious workforce, almost everyone suffers.

---

For these reasons, I think the best structure is a combination.

Equal-wealth for the very rich and very poor (that is high taxes for high earners, free housing/food/education/healthcare/transport/etc for the poor)

Equal-opportunity and a free market for the middle classes (the vast majority of people) where hard work can directly result in a better quality of life

Naturally, there should be no hard cut-off point, but rather a continuous gradient of taxes and welfare.

 

[Granitehead]

Edit: When I say "restricting freedom" I think of stuff like the freedom to kill, the freedom to keep slaves, the freedom to steal, the freedom to exploit others in any way you want, etc., generally spoken, all freedoms people can possess which reduce the freedom of other people when used.

You really think restricting those freedoms is "punishing success"?

No I do not. Perhaps I misread what you mean with minimal freedom.
The basic premise is that everybody has the right to his own life, i.e. the right to be free from force, any force.

This ranges from not being allowed to harm or kill another, to not being able to steal the fruit of his labour (his posessions).

E.g. as a consequence of such a premise, progressively taxing higher incomes is unethical as it is a form of force

(by the poor majority). Note that the state employs force (threat of imprisonment) to force you to pay such taxations.

Likewise, employing ones wealth to deprive others from a chance to living is equally unethical.

"the right to be free from [..] any force"Well, but that's anarchism, in it's initial state, before it veers off towards a kind of oligarchy.

Any government will be exerting force, by definition. The only thing which differs among governments is how much force they exert on whom to reach which goal.

So what you propose (not being allowed to kill, harm, steal, enforced by a government) already violates that premise.

But it gets even worse: You are against progressive income taxes, so I assume in your opinion everyone should pay the same fraction of their income as taxes. But in that case the government /also/ uses more force against richer people: After all they have to pay more money in absolute terms. So to treat everyone absolutely the same, not by the same standard but really the same, then the taxes would need to be the same absolute number for everyone. And by that logic you couldn't have any social securities or public health care: You would effectively be lowering the amount of taxes poor and ill people pay if you did that. You would also need to ignore when someone will starve if you take that amount of taxes from them: After all everyone should pay the same.

 

[Caine]

It seems that any "-ism" breaks down by those who willfully try to sabotage it. From the lazy bastard who refuses to work in a

socialistic government and merely exist by leaching from those who do, to the corporate monopolist who who attains full control

over a critical resource (i.e. essential for life, e.g. food) in a laissez faire capitalism and uses peoples dependency on it

to effectively enslave them.

Which of these do you consider to be the worse outcome?

Depends on the scale on which it happens. We have not seen any form of totalitarian company in practice(other than the state itself) and it is likely that in case one would come into power (or get anywhere close to it)

that a massive revolution would occur. One should not initiate force, but there is nothing unethical about using defensive force.

It is however not in the economical interest of any company to attempt such a thing, so I suspect the scenario to be highly unlikely.

Any socialistic state where the majority decides to be a freeloader, or one where all the rich people decide to do so,

will collapse under its own weight (leaving everyone poor). A fate probably worse than that of slavery itself.

In light of this, I would prefer ruthless capitalism over a socialistic state.

"the right to be free from [..] any force"

Well, but that's anarchism, in it's initial state, before it veers off towards a kind of oligarchy.

Any government will be exerting force, by definition. The only thing which differs among governments is how much force they exert on whom to reach which goal.

Government is allowed to utilize force if and only if it is intended to punish those who initiate force against others.The role of the government in such a case is that of impartial mediator in the conflict to avoid endless wars of retaliation.

Government itself should never initiate force against others. Non-voluntary taxation is force against others.

Taxes are therefore unethical. Social security and public health care which is non-voluntary is unethical.

Social security is nothing more than insurance against loss-of-income paid for by money stolen from others.

Everyone is free to insure his own loss of income with the money he (or she) earns himself.

If someone refuses to work, and is incapable of affording his/her own food, then he/she deserves to starve.

I am not saying that we should let those who are physically incapable of working to starve as well.

I am convinced however that 1) this is the minority and 2) their family/friends/neighbours would gladly support them voluntarily.

For the sake of this discussion, someone who doesn't accept jobs that are "below" him and refuses to start a business of his own,

is unwilling to work and deserves what he will get (i.e. nothing).

 

[comradekingu]

Defending oneself against a set group of known enemies is a flawed concept which is truly beneath human intelligence on every level.

It is the same thing as defining someone as a slave. There is perceived freedom and there is a scaled level. To that extent even human rights are arbitrary.

We like to think they arent, but they are.

People have freedom to the extent they arent afraid of death. Thats the only stability we have.

There is nothing to be done about that but to erode it on a very basic level, mass surveilance, more uneven distribution of force. A total removal of power in the communes of people.

People at large are really useless with total freedom, i think a perceived threat and a laudable goal that is more than anything convenient is how to fail or win.

 

[bzar]

Depends on the scale on which it happens. We have not seen any form of totalitarian company in practice

(other than the state itself) and it is likely that in case one would come into power (or get anywhere close to it)

that a massive revolution would occur. One should not initiate force, but there is nothing unethical about using defensive force.

It is however not in the economical interest of any company to attempt such a thing, so I suspect the scenario to be highly unlikely.

Any socialistic state where the majority decides to be a freeloader, or one where all the rich people decide to do so,

will collapse under its own weight (leaving everyone poor). A fate probably worse than that of slavery itself.

You tipped the scales there a bit. You compared one such company to majority being freeloaders. The typical scenario in real examples is that there are a few freeloaders, very much a minority. The fact that they're frowned upon by non-freeloaders if they have no legitimate reason for it such as an illness preventing them from working combined with the "barely enough to live" you get while freeloading is enough to keep the vast majority working as usual. In Finland we've had a rise in the amount of small-income families due to the global economy and the euro crisis, and I believe their portion of the population is around 13%. Of those only a fraction are people who don't work at all, and of those even a smaller fraction does so by choice. Half of the people freeloading is unthinkable.
Do the comparison again, but now think 1% freeloading and even one such company.

 

[thatgui]

Depends on the scale on which it happens. We have not seen any form of totalitarian company in practice

(other than the state itself) and it is likely that in case one would come into power (or get anywhere close to it)

that a massive revolution would occur.

Well, there maybe not the "one totalitarian company" that rules all, but looking at parts of South America or Africa, you can clearly see how big corporation can behave if govermental control is at a minimum and companies control a vital resource: the ability to earn money.

It is however not in the economical interest of any company to attempt such a thing, so I suspect the scenario to be highly unlikely.

freeloaders

Why not ? If workers organize to fight for higher payments, a company will use some kind of force to work against that, ranging from a single "no" to leathal force.

Any socialistic state where the majority decides to be a freeloader, or one where all the rich people decide to do so,

will collapse under its own weight (leaving everyone poor). A fate probably worse than that of slavery itself.

Do you have any precendence for that ?

In light of this, I would prefer ruthless capitalism over a socialistic state.

So you would starve happily to death because you had an accident at work/home/on the streets (you won't have a lot of safety regulations in a ruthless capitalism, why should there be any?) and can't work anymore, because it was your freedom ?

Social security is nothing more than insurance against loss-of-income paid for by money stolen from others.

Everyone is free to insure his own loss of income with the money he (or she) earns himself.

Which is only possible if they earn enough. Due to some "deregulation" on the job market in the past, we have a quite big amount of people around here, that need support from the goverment albeit they work 35h a week.

If someone refuses to work, and is incapable of affording his/her own food, then he/she deserves to starve.

How many people do you think there are ?

I am not saying that we should let those who are physically incapable of working to starve as well.

I am convinced however that 1) this is the minority and 2) their family/friends/neighbours would gladly support them voluntarily.

But you are actually saying that, and family/friends/etc may not have enough to support them.

For the sake of this discussion, someone who doesn't accept jobs that are "below" him and refuses to start a business of his own,

is unwilling to work and deserves what he will get (i.e. nothing).

What world are you living in ? Or the more interesting question is, what world would like to live in ? Whats wrong with giving some part of the money you earn in order to increase the living standard of society ?

 

[spud42]

hey guys? what has this book discussion have to do with the topic of the thread? i.e. calculating the Pyra price?

shouldn't you take this to the off topic general talk thread?

so ED, with the screen being smaller and if i remember cheaper , are we still on target for an approximate 500 Euro price tag? that's approx $750 AUD depending on exchange rate.

So i will set my Pyra fund target for $1000 to be sure... lol