Two Plus Two Newer Archives - My Journey to the Free Market

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My Journey to the Free Market

Today it struck me that some people assume that I am just assuming government is bad, and then constructing arguments to support it. In other words they accuse me of assuming my conclusion. Nothing could be further from the truth.

I consider myself extremely lucky that my parents were neither particularly religious, nor political. They never took me to church, nor did they rant about how Democrats were awesome and Republicans were awful (or vice versa). In fact, I cannot remember a single time in my entire life when my parents have talked about either religion or politics (to this very day).

Hence I had preconceived notions. I didn't pay attention in school. Rather I sat in back of the class and read paperback science fiction novels behinf my bookbag. Some of you will no doubt claim this explains my current political philosophy; probably true to a large extent. I read a ton of Heinlein. Anyway, no preconceived notions, right. Religion, when I started paying attention to it, was patently ridiculous. I had fun for a few years when the intarnets became widespread arguing with creationists. Good times.

I avoided politics like the plague; I was a little-l libertarian, because that's the way my parents raised me (although without using the word; I probably never heard the word until I was 27); don't [censored] with other people or their stuff. That was pretty much it. It seemed to me that neither major political party wanted to adhere to such a policy, so [censored] the whole thing.

I did have one strong political, however. I was very much pro gun control. Mostly because I was not raised around guns, and quite frankly was frightened by the very concept of them. I though, "You pretty much point at someone and squeeze and they die."

So anyway, along about the time I was arguing evolution with creationists, I got into an argument on the internet (insert retard image here) about gun control. I lost. Badly. He totally destroyed me. Logically and factually. After I conceded the argument I went out and bought a gun and signed up for a concealed carry class.

At about the same time, I had met and started dating my current wife. She introduced me to the term "libertarianism", and I realized that I was a libertarian; especially with the fall of the gun control position. I started reading everything I could about it. I became extremely excited that there were people in the world who basically thought exactly the way I did.

I became extremely active in the local Libertarian Party. I ran for office several times, including for the State House. I was editor of the state LP newsletter.

Meanwhile I continued to read. And watch. I became aware the the system is completely, totally rigged. The parties in power (if it's even worth using the plural) write the election laws, write the ballot access conditions, draw the electoral districts, have total control over a sycophantic media, etc. I realized that voting is a complete was of time, even if all of that were not true. Lastly, I realized that the LP is the proverbial herd of cats, and is a kook magnet for loons and rejects who have zero knowledge of what the libertarian philosophy is about.

Meanwhile, and I don't exactly recall where, I had discovered Austrian economics.

Wow.

Talk about clicking. Everything about Austrianism reminded me of what I absolutely LOVE about physics. It's beautiful. It's elegant. It's logical. It explains so much about the world. It makes a crazy indecipherable world orderly and simple to understand.

The structure of Austrian economics is not, as people who refuse to even look at it seem to think, founded on the assumption that government is bad. Far, far from it. The modern incarnation of the Austrian School is the Ludwig von Mises branch. Mises emphatically did NOT assume that government was bad. He started out bright-eyed and bushy-railed and socialist, believe that the world need to be made better, and that it was the government should and could do it.

It took years within the bureaucracy of the Austrian government, at a very high level, to change his mind. Mises was not an anarchist. He just observed that government interventions in the economy never have the intended result. They always however seem to have extraordinary deleterious uninetended consequences, and he was capable of reasoning out exactly why.

So the structure of Austrian economics, as formulated by Mises, begins with the axiom of human action, as well as some other a priori truths about human nature, such as time preference. It procedes through an analysis of individual action, including value theory, to an analysis of interaction, including price formation on markets. The Austrian analysis presented in Mises' Human Action, and to an even greater depth in Murray Rothbard's Man, Economy and State, lays out the entire structure of the free market; i.e. a non-intervened in market. An imaginary construction in which there is no violence, no coercion. Only voluntary cooperation.

Only then, after the working of a free market has been carefully elaborated, do the Austrians go on to examine the logical results of different types of interventions. They do this completely in the absence of any value judgement about whether intervention is normatively good or bad, or whether the intentions of those who intervene in the market are good or bad. They simply look at the logical implications. Price ceilings cause shortages, price floors cause surplusses, etc. Artificial credit expansion causes a transfer of wealth, a misallocation of resources, an unsustainable economic boom that must be followed by a painful period of liquidation of malinvestments and capital abandonment and reallocation.

The result of these analyses is that interventions in the market always cause distortions, always have deleterious unintended consequences. They always lead to a lowering of the standard of living for the majority of market participants.

Only at this point is the Austrian, unless he is quite pathological, forced by reason to conclude that "government is bad". Austrians are forced by reason to become, at the very least, minarchists. Since the position that the Austrian is then forced to accept, that voluntary transactions produce the best results, is actually the Golden Rule by which most people try to follow in their personal lives any way (no matter how imperfectly), it is easy to then adopt the libertarian ethical framework. Austrians don't start out as libertariasn, reason leads them to it.

Personally, I don't understand how there can possibly be any Austrians who are not yet full blown anarchists, but they do exist. Over the 4 or 5 years since I've counted myself as an armchair Austrian, it seems that the fraction of minarchists has been slowly declining, and the fraction that are anarchists slowly increasing, so that's at least a good sign.

Free market philosophy is supported by what I call the "triple coincidence"; it is system of social organization which is at once natural, ethical, and produces the best results. I believe the first two can in fact be objectively shown, although it is not necessary, and have little qualms about my subjective definition of "best" for the third, as I believe that the vast majority of people would agree with me: I subjectively define the best system of social organization to be one that produces the highest standard of living possible for the most number of people possible.

There is no assumption that government is bad. There is no assumption that those within government have to be bad or evil (although I believe the system selects for those properties). There is no assumption that all persons behave as some sort of ridiculous Homo economics perfectly-rational game-theoretical profit-maximizing[/i] charicatures of human beings; do not confuse the logic of the analysis with some sort of assumption that Austrians rely on all people being robotic Spocks; they don't (this is precisely one of the things that Austrians criticize mainstream economists and the classical economists about; making unfounded assumptions about how or why or what people will choose). None of these assumptions are necessary, so I do not make them.

I hope that explains a little bit of where I'm coming from.