Power & Market

Voltaire—Jealous Lover of Human Liberty

01/31/2022Gary Galles

François-Marie Arouet (1694-1778), who took on the name Voltaire after one of his imprisonments for running afoul of French authorities, was a poet, writer, philosopher and historian of the French enlightenment. In fact, libertarianism.org called him “almost certainly the most important figure of the French Enlightenment,” to the extent that “The Enlightenment is sometimes referred to as ‘The Age of Voltaire.’” He was notorious for his satirical wit, famous for his style, and celebrated for his criticisms of the abuses of authority. He was also an outspoken supporter of civil liberties, including the freedoms of religion, speech, and trade, whose views influenced both the American and French revolutions.

Voltaire was one of the most productive writers in history, who, in an era of strict censorship, backed by harsh penalties, is credited with not only poetry, plays, essays, and novels, but also historical and scientific works, more than 2,000 pamphlets and books, and over 20,000 letters. 

For example, As Wendy McElroy put it, “his Philosophical Letters resounded deeply within the consciousness of Europe for many decades to come. One of its themes was that freedom—especially freedom of commerce—was the true wellspring of religious toleration and of a peaceful civil society.”

  • Although most of Voltaire’s his words were directed to other topics, his work offered useful insight into liberty, and government which is so often its nemesis. As the Stanford Encyclopedia of Philosophy put it “Central to [his philosophy] is Voltaire’s conception of liberty.” In an era when the juxtaposition between liberty and government is still commonplace, his thoughts regarding liberty are still well worth remembering today.
  • Man is free at the instant he wants to be.
  • Liberty of thought is the life of the soul.
  • Think for yourselves and let others enjoy the privilege to do so, too.
  • Virtue supposes liberty…Under coercion there is no virtue.
  • My thought is no more subject to authority than is sickness or health.
  • Liberty…about which so many volumes have been written is, when accurately defined, only the power of acting.
  • Liberty is not and cannot be anything but the power of doing what we will.
  • All men are by nature free.
  • The true character of liberty is independence, maintained by force.
  • All men are equal; it is not their birth, but virtue itself that makes the difference.
  • All the citizens of a state cannot be equally powerful, but they may be equally free.
  • All men have equal rights to liberty, to their property, and to the protection of the laws.
  • If this world were what it seems it should be, it is clear that it would be impossible for one man to enslave another.
  • To learn who rules over you, simply find out who you are not allowed to criticize.
  • No opinion is worth burning your neighbor for.
  • It is through our mutual needs that we are useful to the human race. That is the foundation of all commerce, the eternal link between men. Without it not a single art would have been invented, no society of ten people formed.
  • A multitude of laws in a country is like a great number of physicians, a sign of weakness and malady.
  • It is the poverty connected with our species which subordinates one man to another. It is not inequality which is the real misfortune, it is dependence.
  • So long as the people do not care to exercise their freedom, those who wish to tyrannize will do so; for tyrants are active and ardent, and will devote themselves …to put shackles upon sleeping men.
  • History contains little beyond a list of people who have accommodated themselves with other people’s property.
  • In general, the art of government consists in taking as much money as possible from one party of the citizens to give to the other.
  • The tyranny of the many [is] when one body takes over the rights of others, and then exercises its power to change the laws in its favor.

Included in his vast body of writing, Voltaire offered readers insights into liberty, and especially freedom of expression, which his use of put him both in prison and in exile for criticizing those with power. And his influence reached to America’s founding. Even a famous saying falsely attributed to him says something important about his approach: “I do not agree with what you have to say, but I’ll defend to the death your right to say it.” In an age where government providers of dis- and mis-information, and others who want more government control, are so intent on policing everyone else’s words, we could benefit greatly from Voltaire’s jealous love of liberty, particularly liberty of expression.

Vaccine Mandates Result from the Abuse of True Science

12/07/2021Birsen Filip

There is an alarming degree of uniformity between the governments of many western countries when it comes to instituting tyrannical measures like mandatory medical injections at workplaces and vaccine passports. In doing so, they have departed from liberal values and principles, by no longer recognizing or respecting private spheres, personal goals, or individual freedom and rights. They have also ignored the fact that living in a liberal democratic society means the state is limited to a reasonable level of activity or interference that is neither detrimental nor destructive to various types of freedoms, including negative, positive, individual, subjective, and objective freedom.

At this point, it is clear that vaccine passports and mandates have nothing to do with safeguarding public health or mitigating the COVID-19 pandemic. Rather, they are purely coercive measures designed to punish disobedience by taking away one’s ability to provide for his family, shape his future, engage in activities that bring him happiness, and live his life in ways that allow him to flourish and advance his well-being. That is to say, they are effectively capable of destroying people’s dreams, goals, self-respect, self-esteem, self-development, aspirations, etc. They are also damaging for public health and the common good, as a society cannot provide a safe, secure and healthy environment for its citizens without an adequate number of people to provide key social services, including police forces, health care workers, fire fighters, sanitation workers, and teachers.

Recent data from Israel, the UK, and other nations with high vaccination rates suggest that the COVID-19 injections are of very limited effectiveness in terms of preventing the spread of the virus, and it is unclear how long any personal protection that they might provide actually lasts. In the case of Israel, the poor performance of the COVID-19 injections has resulted in a third injection being pushed on people that were previously thought to be fully vaccinated (i.e., two shots). Consequently, the Israeli Health Ministry recently reported that, in less than one year, “nearly 90% of people over the age of 60 had their third shot, compared with around 70% of people ages 40-49 and fewer than 50% of people ages 20-29.” Israel managed to achieve such high inoculation rates for third doses despite the fact that Moderna and Pfizer-BioNTech are still in the process of conducting or setting up clinical trials to test the effects of COVID-19 booster shots on people.

The COVID-19 injections did not follow the proper evaluation and approval processes for creating an effective vaccine, which typically takes between 10 to 15 years. Nonetheless, anyone that has dared to question the unknown future risks of these new vaccines, criticize vaccine passports and mandates, or point out inconvenient details like the fact that fully vaccinated people can still get infected and transmit the virus to others, has been publicly shamed and labelled as “unscientific,” “anti-vaxxer,” “selfish,” and “conspiracy theorists.” No one has been spared from the attacks of vaccine zealots, including professors, politicians, scientists, lawyers, nurses and doctors. Essentially, divergent views, ideas, approaches and perspectives, which are crucial for the progress and evolution of science, have been ridiculed or strongly rejected in the mainstream narrative. In fact, this has been true of virtually anyone that supports informed choice over obedience, and freedom over submission.

Totalitarian governments of the pandemic, unelected health experts and biased news reporters have been incessantly glorifying the vaccine mandates, often with religious undertones. In the United States, this has led to the emergence of a “false prophet” in the form of Dr. Anthony Fauci, whose dictates are widely treated with a deference that resembles a “divine pattern” by devoted adherents in a number of countries. Unfortunately, the faithful followers of this “false prophet” fail to understand that “prophecies are entirely beyond the scope of scientific method.”1 They also might not realize that science is concerned with objective facts and true images of the real world, while simultaneously opposing fear, hate, subjective opinions, coercion, faith and revelation. In fact, adherents of true scientific approaches renounce faith, revelation, and divine patterns on the basis that science explores the unknown “to establish what is,” rather than to “dictate what ought to be and what ends people should aim at.”2 They are of the opinion that “no science can tell anyone what one wants, what one should uphold, what one should grind into the dust.”3 Accordingly, any true scientist would regard vaccine mandates as wholly unscientific.

The development of science throughout history has frequently featured significant disagreements between scientists on a wide range of issues, including concepts, priorities, principles, methodologies, procedures, points of view, explanations, theories, assumptions, approaches, and goals. Such disagreements and doubts have often led to the refutation and abandonment of theories, assumptions, principles, methods, and goals in favor of new ones that emerged. Ultimately, this process has resulted in the expansion of knowledge and realization of progress. That means, in science, progress and “advances consist in finding out” where people had been wrong.4

True scientists are fully aware of what they do not know, and are prone to exercising caution until they acquire more knowledge. They do not hide information and empirical evidence in order to defend certain ideas, or specific products. On the contrary, they would be more than happy “to prove” that their “anticipations were false” and overthrow them.5 It is not the “possession of knowledge, of irrefutable truth, that makes the man of science, but his persistent and recklessly critical quest for truth.”6 True scientists would avoid “rash and premature prejudices” and developments.7 Meanwhile, the treatment of the COVID-19 injections by Dr. Fauci and his followers could be described as idolization, which halts the road to scientific progress. In fact, this sort of idolization is an abuse of science, in that it is the “wrong view of science” that “betrays itself in the craving to be right.”8 Many current western political leaders support the tyranny of abused science, which has played a crucial role in justifying their recently acquired totalitarian powers.

It would appear that the tyrannical leaders of the pandemic and their anointed “false prophets” regard the masses with disdain, believing that they do not possess intelligence or the ability to think critically. Much like “the eugenicists” that came before them, the current crop of unfit tyrannical rulers and “false prophets” have managed to “delude themselves in assuming that they themselves will be called to decide what qualities are to be conserved in the human stock. They are too dull to take into account the possibility that other people might make the choice according to their own value judgments.”9 They have not only concluded that people do not know what is best for themselves, their actions are destroying the progress made over the course of the entire history of Occidental civilization by eliminating various guarantees and protections of freedom, including the constitutions or charters of rights of individual countries, international laws and agreements like the Nuremberg Code, the Declaration of Helsinki, and the Universal Declaration of Human Rights, and the labor protections established and defended by trade unions.

People should be weary of the “false prophets” and totalitarian governments of the pandemic, as the “return to the closed society which they advocate is the return to the cage, and to the beasts.”10 Instead of unquestioningly accepting the fictitious oracles of these “false prophets,” individuals should find ways to once again become the makers of their own fates, if they are to breathe and think freely. Prior to the normalization of the present environment of fear, hate, discrimination and division, it would have been unimaginable that the leader of any western country would attempt to suspend so many types of freedom and mandate medical procedures for the entire population, essentially transforming the country into a laboratory. Doing so would have run the risk of landing them in a prison or an insane asylum. The mere existence of this type authority proves that “the forces which generated” Fascism and Nazism are not “dead.”11 Moreover, everybody around the world needs to be cognizant of the fact that if such a ruling party ever managed to gain the full backing of the police and military forces, then “the glorification of violence,” or the violent oppression and liquidation of dissenters, which characterized “the policy of Russian Sovietism, of Italian Fascism and of German Nazism” will become inescapable.12 Accordingly, it might be fitting that any politician who advocates for the destructive, uncivilized, and inhuman policies associated with totalitarian regimes might be called a Bolshevist, Nazi or “fascist psychopath.”

  • 1. Karl Popper, The Open Society and Its Enemies. (1945: repr. London: Routledge, 2002).
  • 2. Ludwig von Mises, Socialism: An Economic and Sociological Analysis, trans. J. Kahane (New Haven, CT: Yale University Press, 1962), p. 539.
  • 3. Joseph Schumpeter, ‘Gustav von Schmoller and the Problems of Today.’ (1926; repr. Journal of Contextual Economics 138: 261 – 304. Berlin: Duncker & Humblot), p. 263.
  • 4. F.A. Hayek, The Constitution of Liberty, ed. Ronald Hamowy, vol. 17 of The Complete Works of F.A. Hayek (1960; repr. Chicago: University of Chicago Press, 2011).
  • 5. Karl Popper. The Logic of Scientific Discovery. (1935; repr. London: Routledge, 1992), p.278-279.
  • 6. Popper, The Logic of Scientific Discovery, p.281.
  • 7. Popper, The Logic of Scientific Discovery, p.278-279.
  • 8. Popper, The Logic of Scientific Discovery, p.281.
  • 9. Mises, Socialism, p. 582.
  • 10. Popper, The Open Society and Its Enemies.
  • 11. Mises, Socialism, p. 578.
  • 12. Mises, Socialism, p. 480, 572.

Voting, Interest Groups, and the State

08/24/2021Lipton Matthews

The implementation of voter ID laws to prevent fraud has led some to argue that voting rights are under assault by the state. But this mistaken assumption is predicated on a false premise, because voting is not a right. Rights exist independent of the political regime, so even though communist states abrogate human rights, this does not alter the fact that people still have a right to own property and express religious beliefs. Essentially, voting is a mechanism implemented by the state for political purposes.

Voting permits citizens to participate in governance by declaring support for various policies. But failing to entertain some opinions could enhance living standards, as economist Bryan Caplan intuits in his provocative book The Myth of the Rational Voter. Caplan rightly argues that politicians fixate on delivering the goods of democracy instead of enabling markets to facilitate the long-term development of society. The average voter rarely appreciates the intricacies of governance, and as a result, succumbing to his demands may prove to be disastrous. After all, it is not unusual for voters to espouse support for economically harmful policies like trade protectionism and occupational licensing.

Moreover, voting offers an opportunity to undermine rights, because individuals are given the prerogative to determine benefits for other people. In 2013, for example, Swiss voters rejected a proposal to cap executive pay. Despite the logic of their choice, Swiss voters really had no business influencing the compensation of executives. Politicians and citizens alike should direct their focus toward elevating the caliber of governance rather than expanding democracy. But ultimately doing so requires a recalibration of our perception of the state.

Like the corporation, the state is a legal fiction entitled to select the criteria for participating in governance. For instance, in a company, board members are not obliged to act on the recommendations of junior employees. Yet this stance does not deter directors from advancing the interests of workers. Hence the fear that voting restrictions ensure that the concerns of some groups are avoided is unwarranted. A case in point is that though children are unable to vote, politicians still champion their cause. Their devotion to children is illustrated by laws against child labor and abuse. Likewise, people suffering from serious cognitive deficits are unable to vote, yet this has not discouraged politicians from lobbying for the mentally disabled. Neither did the exclusion of women from the political arena prevented politicians from privileging their concerns, as Ernest Bax noted in his 1896 publication The Legal Subjection of Men.

At some point, we must confront reality by admitting that prioritizing development by limiting voting is a feasible strategy to promote progress. As such, we should discuss groups that must be barred from voting. Undoubtedly, disallowing lobbyists from voting would protect democracy from becoming enslaved to special interest groups. Such groups exert enormous influence on the political system at the expense of other citizens. When these groups obtain subsidies and political privileges, taxpayers feel the brunt. One estimate suggests renewable energy subsidies will cost taxpayers more than $40 billion from 2018 to 2027.

Another disadvantage of interest groups is that public-sector unions make it costly to dismiss reprobate employees. Richard Berman in the Washington Times details the daunting task of sacking sexual predators due to the rigidity of union protection rules:

Longtime teacher John Vigna was recently sentenced to 48 years in prison for repeated sexual abuse of his students. Cases of teacher-student sexual abuse are all too common. Hundreds occur nationwide each year. What’s worse is that teachers often demonstrate warning signs of perversion before they offend—or before their offenses amplify—but cannot be fired because of union protection rules. In Vigna’s case, sexual abuse complaints were lodged against him as far back as 2008. In 2013, a top district official called his conduct “indefensible, inappropriate, and intolerable.” But he was allowed to stay in the classroom.

Teachers' unions wield phenomenal power, and according to Education Next, since 1990, the American Federation of Teachers and the National Education Association have usually been among the top ten contributors to federal electoral campaigns. Even more striking is that union members regularly constitute at least 10 percent of the delegates at the Democratic National Convention, making them the single largest organizational bloc of Democratic Party activists.

Therefore, if members of these bodies are unable to vote, then politicians will no longer be inspired to indulge their demands. So, consequently elected representatives will have a stronger incentive to govern in the interest of citizens. Similarly, the privilege of government employees to vote should also be rescinded. Officials in the public sector depend on state resources, so by exerting political clout, they can obstruct the course of democracy.

The power of bureaucrats to corrupt governance is artfully captured by Ludwig von Mises in his book Bureaucracy: “Representative democracy cannot subsist if a great part of voters are on the government payroll. If the members of parliament no longer consider themselves mandatories of the taxpayers but deputies of those receiving salaries, wages, subsidies, doles, and other benefits from the treasury then democracy is done for.” Likewise, beneficiaries of welfare should equally be prohibited from voting to deter politicians from becoming susceptible to requests requiring the distribution of wealth. Resultantly, when fewer people are permitted to vote, the political system will be better insulated from the costs of populism.

To foster development, we must recast the state as a corporation preserving society’s resources for the future benefit of the unborn. Hence its long-term outlook will favor development to democracy. The truth is that universal voting is not a positive feature of democracy, but rather an impediment to progress.

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Vaccine Passports Are Just a Way for the Regime to Expand Its Power

05/03/2021Ryan McMaken

Listen to the Audio Mises Wire version of this article.

Earlier this month, the conservative magazine known as The Spectator published an article with the absurd title “The Libertarian Case for Vaccine Passports.” The online version now bears the title “Vaccine Passports Are a Ticket to Freedom,” but the physical print version is perhaps more descriptive of what the author is trying to do.

The author, a former Conservative politician named Matthew Parris, apparently believes that the forever lockdowns are an inescapable feature of reality, and that the only way around them is for the regime to enact a vaccine passport scheme. For Parris, covid lockdowns are just a force of nature, like gravity. Now, if only we could find a way to get around these nature-imposed lockdowns!

By now the flaw in Parris’s logic should be clear. There is nothing natural or inescapable about lockdowns. They are an invention of the state. They are so unnatural, in fact, that they require the use of the state’s police powers to enforce them. They require policemen, handcuffs, courts, prisons, and fines to ensure they are followed. Those who ignore this supposed “force of nature”—and these scofflaws are many—must be punished.

All of this escapes Parris’s notice, however.

For example, his article begins this way:

In principle I’m in favour of vaccination passports, and don’t understand how—again in principle—anyone could be against the theory….

In other words, Parris’s position—in his mind, at least—is so correct and so commonsensical that he can’t even comprehend how someone would disagree with him.

This, of course, is always a highly suspect way to begin an article. Any intellectually serious political commentator, if he tries a bit, can at least imagine why others might disagree with him. After decades in government, however, Parris is so enamored of the idea that the regime ought to control your every move that any another option is apparently beyond the pale of rational thinking.

Parris goes on:

To me it seems not just sensible and fair but obvious that access to jobs or spaces where there is an enhanced risk of viral transmission might be restricted to people who could demonstrate a high degree of immunity.

There is absolutely nothing libertarian about delaying the lifting of lockdown for everybody, just because it wouldn’t be safe for somebody.

Again, note the core assumption: the regime must tell you where you are allowed to go and what you are allowed to do. It is those dastardly libertarians who are the ones "delaying the lifting of lockdowns." For Parris, politicians have been working hard to find a way that society can be set free. These noble policymakers discovered vaccine passports. At long last, people can be allowed to leave their homes. But those libertarians now stand in the way!

Unlike those libertarians, Parris assures us he is in favor of people leaving their homes and visiting each other in public gathering places. It’s just that his hands were tied before. There were no options available to him other than keeping you locked up. Now, dear taxpayer, won’t you let Parris and his friends set you free? They want you to be free. It’s just that there’s nothing they can do until you embrace vaccine passports!

If you’re noticing that Parris sounds a bit like an abusive husband, you wouldn’t be far off. Just as an abuser tells his wife, “See what you made me do!” after he punches her in the face for burning the toast, we see a similar attitude from the vaccine passport crowd: “You see what you’re making me do? I want to let you out of your house, but you refuse to submit to our oh-so-libertarian passport system!”

Yet Parris is not alone in this sort of thinking. Many others continue to advocate for vaccine passports as some sort of profreedom scheme. Passports are being framed as an “easing of restrictions.”

But, as epidemiologist Martin Kulldorff and Stanford physician Jay Bhattacharya pointed out this month in the Wall Street Journal, there is nothing in the passport scheme that is geared toward lessening regime control of our daily lives. On the contrary, it is all about extending and increasing regime power. Kulldorff and Bhattacharya write:

The idea is simple: Once you’ve received your shots, you get a document or phone app, which you flash to gain entry to previously locked-down venues—restaurants, theaters, sports arenas, offices, schools.

It sounds like a way of easing coercive lockdown restrictions, but it’s the opposite. To see why, consider dining. Restaurants in most parts of the U.S. have already reopened, at limited capacity in some places. A vaccine passport would prohibit entry by potential customers who haven’t received their shots….

Planes and trains, which have continued to operate throughout the pandemic, would suddenly be off-limits to the unvaccinated….

The vaccine passport should therefore be understood not as an easing of restrictions but as a coercive scheme to encourage vaccination….

Naturally, the regime claims this is all “required” by “science,” but

[t]he idea that everybody needs to be vaccinated is as scientifically baseless as the idea that nobody does. Covid vaccines are essential for older, high-risk people and their caretakers and advisable for many others. But those who’ve been infected are already immune. The young are at low risk, and children—for whom no vaccine has been approved anyway—are at far less risk of death than from the flu. If authorities mandate vaccination of those who don’t need it, the public will start questioning vaccines in general.

“Science” mandates nothing as a matter of public policy. Rather, it is policymakers—backed by the violent power of the state—who impose mandates. These are policy choices, not forces of nature. Moreover, as Kulldorff and Bhattacharya note, these aren’t even prudent policy choices, and are based on questionable conclusions wrought from scientific data. The authors continue:

Most of those endorsing the idea belong to the laptop class—privileged professionals who worked safely and comfortably at home during the epidemic. Millions of Americans did essential jobs at their usual workplaces and became immune the hard way. Now they would be forced to risk adverse reactions from a vaccine they don’t need. Passports would entice young, low-risk professionals, in the West and the developing world, to get the vaccine before older, higher-risk but less affluent members of society. Many unnecessary deaths would result.

But we know how the regime will justify mandatory vaccine policies to themselves should some be injured by adverse reactions. "We had no choice!" the politicians will insist. "Science forced our hand!" This is a convenient way for politicians to weasel out of responsibility for forcing much of the population—much of it a low-risk population—into submitting to certain state-mandated medical procedures. But lest we take too cynical a view, it's entirely possible these people are true believers. Like Parris, the policymakers forcing these policies on citizens and taxpayers might not be able to comprehend any other course of action. This level of moral certitude is a certain privilege of the ruling class, and it certainly has nothing to do with "science."

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Value Is a Process

03/09/2021Mark D. Packard

[This article is a summation of arguments made in a recent academic publication in Small Business Economics Journal, entitled “Subjective Value and Entrepreneurship” by Drs. Per L. Bylund and Mark D. Packard.] 

What is the value of a pizza?

If you asked a standard economist, they might—thinking themself quite clever—ask in return, “well, what would you pay for one?” Now, that’s a fine response as far as it goes. But in neoclassical economic theory, that’s not as far as they seem to think.

Standard economists will readily admit that value is subjective, but what they mean by that is not what subjectivists mean by it. See, in philosophy of science, social science divides down strict lines of ‘objectivism’ and ‘subjectivism.’ The objectivist—also realist or positivist (these are distinct terms, but align in the objectivist paradigm)—sees the social world as comprising real things, objective phenomena that are more-or-less stable and causally deterministic and, thus able to be studied as such. In other words, social reality is in principle no different from physical reality, and we can study it the same way. Yes, it’s true that there’s tons of noise and randomness when studying social phenomena, which require statistical methods to find causal relationships, but the same is true of certain natural sciences too, such as climate science (not exactly a ringing endorsement in many libertarian circles).

Applying objectivist philosophy to the value concept, the assumption is that value is real and objective. A pizza has value—it’s there in the pizza. But what’s interesting about this value—which has been defined as ‘marginal utility’ since 1871—is that it’s different for everyone. Utility, of course, is usefulness—how much benefit I would get from the pizza. But utility is different for everyone—we have different tastes, dietary needs, and so forth. What this means is the objectivist economist—which is most of them—understands value as objective but idiosyncratic. ‘Idiosyncratic’ is synonymous with ‘subjective’ if you’re an objectivist.

But philosophical subjectivism, as the Austrian School espouses, sees the social realm very differently. There is no “social reality,” strictly speaking. A job, a marriage, a personality, a reputation—these don’t really exist. ‘Reality’ references the physical realm—what the natural sciences study. The company Google is just a concept—a figment of our imagination. There are real people that ‘belong’ to the Google organization; there are physical structures that comprise Google’s offices (the Googleplex); Google even creates some physical products. But the organization ‘Google’ is just a concept that Sergey Brin and Larry Page conjured and was granted ‘legal status’ (which is just getting another imaginary organization’s imaginary stamp of approval), which solidified the concept ‘Google’ as a ‘legal entity’ into the minds of people that is—for most intents and purposes—for us as if Google were a real ‘thing’. Lots of social constructions are like that: marriages, job titles, fictional characters like Harry Potter, etc. Many more are flimsier: relationships, reputations, scientific knowledge, etc. These have little or no institutional status, and so evolve with the whims of society. Studying social phenomena from this subjectivist perspective, then entails understanding what people think about those phenomena, how they understand them and why.

Value, from a philosophically subjectivist viewpoint, is very different from the objectivist concept of value as objective, idiosyncratic usefulness. Instead, subjective value occurs in the mind.

There are two key aspects of a subjective value concept, which we can distinguish by the form of word (i.e. part of speech) that it takes. As a verb, value (i.e. to value) is a prediction of or reflection on a benefit (depending on the context of the valuing). To say “I value the pizza” means either ‘I expect to benefit from the pizza’ or ‘after eating the pizza, I recognize benefit gained from it.’ As a noun, value is a conscious experience of benefit. This means that there is no value until it’s been experienced. When you understand the experiential nature of value, then we can’t equate predictions of value (value as a verb) with real value (value as a noun).

So when we ask, again, what is the value of a pizza, the right retort, from a subjectivist perspective is not “what would you pay for one,” but “how much benefit did you experience from it?”

To show how and why this matters, consider an example. Let’s say you’re hungry and are in the mood for pizza, enough so that you’re willing to pay up to $20 for one. So you ordered a pizza from Bylund Pizzeria around the corner for $10, who makes the pizza at a cost of $5. You have it delivered and leave $2 for tip, bringing your total outlay to $12.

In the traditional economic analysis, the example stops here. You have all the information that you need to calculate total economic value created. Economists estimate value as willingness-to-pay or WTP—how much you were willing to spend to satisfy your want, $20 in this case. The price P ($10+2) and cost C ($5) are the other two relevant factors. Total economic value creation is calculated as WTP-C, the total new consumer value minus the cost in resources and labor to produce it: $20 - $5 = $15.

But the subjectivist framework doesn’t stop here. Again, value hasn’t emerged yet, since it hasn’t yet been experienced. So let’s keep going. You sit down to the table, open up the pizza box and find a beautiful pizza with a fat cockroach crawling on top of it. You slam the box shut and run it outside to the nearest dumpster.

So let’s redo our economic value analysis now. Value isn’t WTP, it’s the benefit experienced. What was the total value achieved from the pizza? Zero. Probably even negative—you could say that you experienced harm rather than benefit, both in the trauma of the fright and in the fact that now dinner is going to be late. Let’s plug in zero: $0 - $5 = -$5. In other words, economic value was destroyed in the transaction—$5 of resource were expended for absolutely no benefit.

Life is an endless value journey—action and experience are continuous from birth to death. This journey is a learning process. What valuation should we assign goods, services, and activities? How should we prioritize our activities and expenditures to maximize our value experiences and well-being?

The principle of diminishing marginal utility—that consumption of a second unit of a good is not as valuable as the first—is widely known and accepted. But what’s not widely admitted, although we know it intuitively, is that the needs that we must satisfy to maximize well-being are dynamic. We keep getting hungry over and over again. One might break an arm, birth a child, pick up a new hobby, or start a new diet—changes that alter the things we value most. Similarly, changes are going on around us that have similar effects—changes in the weather, new innovations, pandemics, and politics.

Value is a process—one that we’re not just constantly engaged in but also constantly monitoring and learning from. It is in this process—in advancing it forward—that we find the essence of entrepreneurship.

Venezuelans Must Reject Not Just Chavismo, but Also Keynesianism and Mercantilism

There is a decision that no person, nor foreign government, can make for Venezuelans: decide how Venezuela will be after Chavismo. We think and are always asserting that our fellow Venezuelans have to reject any “kind of socialism," because if the society accepts a return to the practices and policies that were in place before the Chavez era, they will be condemned to repeat history.

The truth is that there is not a nonsocialist or nonmercantilist option in the political arena. Indeed, some self-proclaimed “classical liberal,” “right-wing,” or “conservative” options are just mercantilists, liberal socialists, or social democrats trying to disguise their real nature. This is hopeless for our relatives, friends, and anybody who still lives in Venezuela, hopes to continue living there, or who must remain and is faced with deciding whom to support. Worst of all, the only thing that is true of all those options is that to support any of them is to support the imminent repetition of the corruption, cronyism, and bad policies of the past.

Neither a quick and painless international military operation nor a long, painful, and corrupt “democratic” negotiation to overthrow Maduro will be enough if people allow Juan Guaido and his comrades to apply the socialist agenda called “Plan País.” Keeping the status quo—a central bank, a minimum wage and other laws that increase the cost of starting a business, economic controls, barriers to international trade, state ownership of the commanding heights, and a high level of fiscal independence from the government—will not solve the problem forever.

We understand that eradicating tyranny would solve, in the short run, great problems for other countries, such as a massive and increasing migration, and for Venezuela, such as access to basic goods and services. Nevertheless, these solutions would just be short lived. Many of those more than 10 million Venezuelans living in other countries would not return, and all the economic, social, and political problems would arise in the middle to long run in a scenario like this. Why? Because, as in the past, the system that Guaido and his comrades propose will collapse at any moment and a new and stronger "kind of Chavismo" will grip the country once again and jeopardize freedom and stability in the region.

The GDP per capita has been widely criticized as an index of quality of living. Notwithstanding, we will use it to support our argument that the social democratic era paved the road to harder socialism like Chavismo with its policies. The following graph shows the average income per capita of Venezuelans:

After a great and sustained period of economic growth (1950–57), Venezuelans enjoyed an average income of $8,400 (in 2011 US dollars). Immediately after the social democracy started, Venezuelans suffered a decrement in their incomes, and by 1963 they had incomes similar to 1953 levels. Nevertheless, from 1964 incomes started to increase, achieving their highest level in 1980, of around $10,500. After that year, incomes started to plummet, reaching around $6,400 in 1998, when Chavez won his first election. Strictly speaking, Venezuela passed the 1957 threshold during just fifteen of the forty years of the social democratic era. The maximum incomes represented 124 percent of the 1957 incomes, but the social democracy era closed with an average income of just 76 percent of 1957 levels, which is almost the same income that Venezuelans had in 1951. Then, Venezuelans suffered a sustained and continuous impoverishment process, one of the reasons they trusted the radical and harder socialist promises of Chavez.

From this graph, we can extract many undesirable truths. For example, not even with Maduro did the average incomes decrease as much as they did during the social democratic era. We are not saying that Chavismo has been better than social democracy (in fact, to us Chavismo is its offspring). We want to remark the unfeasibility of the “Plan País,” which is just an extension of a failed plan called “El Gran Viraje” (the great turn) that was in place from 1989 to 1993; even in that period the failure of such Keynesian policies is evident.  Chavismo and social democracy have relied on oil prices, and you can see high instability and volatility in the graph for that reason. Plan País would be funded and supported with oil and international debt. Despite the fact that poverty was increasing before Chavez, there was not the great problem of scarcity and the humanitarian crisis that we see today. People should understand that these problems are the symptoms and what we have to eliminate is the bacteria that causes them. That is socialism.

Voting for Integrity over Hypocrisy

06/23/2020Gary Galles

I have long been a fan of science fiction. I like it for the escapism it allows me. But sometimes I also find some real nuggets of understanding there. I found one example that bears upon America’s coming election in a Jack Campbell novel:

People are always talking about demanding more and better performance from elected officials, but when you get right down to it, shouldn’t a democracy demand more and better performance from the citizens who vote? If they do their job well, then the quality of those they elect will naturally follow.

That is one of the best summaries I have ever seen of Foundation for Economic Education founder Leonard Read’s view on voting. Since Americans will soon be assaulted with questionable election year assertions of why they must vote and who they must vote for in 2020, his rationale for why not voting can better defend our liberty merits consideration.

As Read articulated in in his classic, Anything That’s Peaceful (1964):

  • "Today…often a voter cannot cast a ballot except for one of two trimmers."
  • "A trimmer…trims his personal idea of what is morally right, tailors his stand to the popular fancy. Integrity…is sacrificed to expediency."
  • "Why, asks the responsible voter, should I endorse dishonesty by voting for such a candidate?"
  • "When both candidates for public office are judged to be trimmers, the one who trims less than the other is often regarded as 'the lesser of two evils.' But, is he really?"
  • "Principles do not permit of compromise; they are either adhered to or surrendered….To trim is to ignore the dictates of higher conscience…to take flight from integrity. Is not the candidate who will trim…ready to abandon the dictates of conscience[?]…Does not the extent or quantity of trimming merely reflect a judgment as to how much trimming is expedient?"
  • "When one must choose between men who forsake integrity…there is little relief at the polling level except as candidates of integrity may be encouraged by voters of integrity."
  • "How can candidates of integrity be encouraged by voters (and non-voters) of integrity?"
  • "One candidate will stand for the coercive expropriation of the earned income of all citizens…to those in groups A, B, and C…[H]is opponent differs from him only in advocating that the loot be given to those in groups X, Y, and Z."
  • "Does responsible citizenship require casting a ballot for either of these political plunderers? The citizen has no significant moral choice but only an immoral choice [made because] one of the candidates will deliver some of the largess to him or to a group he favors."
  • "Does responsible citizenship require voting for irresponsible candidates?…To cast a ballot for a trimmer, because no man of integrity is offering himself, does as much as one can with a ballot to encourage other trimmers to run for office…to urge, as strongly as one can at the polls, that men of integrity not offer themselves as candidates."
  • "What would happen if we adopted as a criterion: Never vote for a trimmer!"
  • "Would the end result of this…large-scale demonstration of 'voting by turning our backs,' compound our problem?…In time…Men of integrity and high moral quality—statesmen—might show forth."
  • "Would a return to integrity by itself solve our problem? No…But it is only among men of integrity that any solution can begin to take shape."
  • "If respect for a candidate’s integrity were widely adopted as a criterion for casting a ballot, millions…would not cast ballots. Yet, in a very practical sense, would not those of us who protest in this manner be voting…who, by our conscious and deliberate inaction, proclaim that we have no party. What other choice have we at the polling level? Would not this encourage men of statesmanlike qualities to offer themselves in candidacy?"
  • "There is no moral or political or social obligation to vote merely because we are confronted with ballots…doesn’t this 'obligation' deny to the citizen the only alternative left to him—not to endorse persons or measures he regards as repugnant? When presented with two trimmers, how else, at this level, is he to protest? Abstinence from ballot-casting would appear to be his only way to avoid being untrue to himself."

Leonard Read rejected much of the current civic religion of political involvement, because it amounted to "regardless of integrity, vote." He argued for making integrity our central focus. And if we reflect on how infrequently we would use the word's common meanings or synonyms, such as incorruptibility, adherence to moral and ethical principles, honesty, reliably doing the right thing, uprightness, rectitude, sincerity or honor, to describe those we "must vote for," it certainly might improve things. Instead we see and hear its antonym—hypocrisy—demonstrated daily.

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Virginia Is Only the Beginning

01/20/2020Tho Bishop

Despite smears and scare tactics from the Virginia law enforcement and the corporate press, thousands of protestors have landed in the capital of Old Dominion in response to an anti-gun agenda being pushed by the new solid-blue state government. While large protests aren’t particularly unique in American politics, this particular event has captured the media’s imaginations in no small part due to the fact it consists of their favorite sort of villain: largely white, Trump-supporting, armed men. They can’t help but salivate at the idea of it descending into the tragic chaos that occurred in Charlottesville in 2017.

To a certain degree, the showdown in Virginia is really only superficially about guns. It also represents the valid anxiety that has arisen as the state’s rural population finds itself increasingly powerless in the face of rapidly expanding political power wielded by high-population centers.

Of course, it’s not surprising that the same commentators that often condemn—foolishlyeconomic gentrification, openly cheer political changes that threaten the way of life of families that have lived in an area for, in some cases, hundreds of years.

In a rare instance of usefulness, David Frum tweeted out today this chart illustrating the political trends in the state:

So what we see playing out in Virginia is, as Jeff Deist has frequently noted, the question of what happens to politically vanquished people.

Of course, to the Frums the answer is obvious. If your side doesn’t have the ballots, it’s time to submit or pay the price.

Of course, Frum’s evoking the only American president to wage war against an American nation makes sense given his long and bloodstained support for centralized power and the American empire. To others who do not share his cavalier dismissal of life and liberty, the question deserves more serious analysis than simply asking, What Would Abe Do?

In Virginia, we see two major contributing factors to its new progressive domination.

One, a massive influx in non-native-born Virginians due to the massive growth of the North Virginia economy. While it’s worth noting that much of this growth is the direct byproduct of the growing federal leviathan—both in terms of direct state employment and companies that relocate there to ensure better access to the dollars that come with it—the state connection here isn’t particularly important to the larger trend. After all, we see similar trends in non-beltway adjacent red states such as Texas, Florida, and Tennessee, where companies are relocating for better tax environments.

Two, the high-growth urban areas have also made Virginia one of the most schooled states in the country. The state is now sixth in the country in terms of percentage of residents with a bachelor’s degree or higher. While an educated population would once be considered a strength, the devolution of higher education means that such rankings now have some correlation with Americans favorable to the political left.

It is not a coincidence, for example, that Millennials are the most schooled generation America has seen—and also the ones most open to socialism. Further, when it comes to cultural issues—such as political correctness, abortion, or acceptance of drag queen story time—it is white college-educated Americans, not immigrants, who are the most out of line with rural Americans.

While Virginia’s unique history, as the native country of most of the most famous American founding fathers, along with being the former capital of the Confederacy, adds a level of symbolic significance that may escalate these tensions superficially, the divide on display today is likely to be repeated as otherwise-red states continue to see their cities grow.

It is not difficult to imagine, for example, the Atlanta metro area amassing large enough of a voting population to cancel out the votes of the rest of the state. In New York, we already see how a political majority in the city dictates the politics for everyone else.

What’s the solution, then? Well if the goal is having governments reflect the ideology of its residents—the true aim of democratic political self-determination—then the goal should be to add and alter states as need be. Allow northern Virginia to serve the interests of its solid blue base. Allow southern Virginia to defend the rights and cultural norms of southern Virginians.

The alternative is to continue our current democratic imperialism—which runs the risk of escalating to the point where today’s protesters show why it is so important to stand up for their right to bear arms. 

Venezuela's Central Bank Admits the Country's Economy Is a Mess

05/30/2019Ryan McMaken

The Venezuelan central bank has released new data showing just how far the nation's economy has disintegrated in recent years.

MercoPress reports this week (in text that is rather loosely translated from Spanish):

After several years, the Central Bank of Venezuela (BCV) published results of gross domestic product (GDP) until the third quarter of 2018, with which officially confirms the recession that is experienced in the oil country. With the data it is known then that between the third quarter of 2013 to September of last year the economy lost 52.3%. President Nicolás Maduro is on power since 2014.

The BCV report draws a demolished economy. According to the institution, the construction sector fell by 95% between the third quarter of 2013 and the third quarter of 2018, the manufacturing sector by 76%, trade by 79% and financial institutions by 79%. According to the data released on Tuesday, towards the end of 2018 the collapse accelerated.

The official figures of the BCV also confirm the magnitude of the Venezuelan economic recession that has been recorded since the arrival of Nicolás Maduro to the presidency of the country. According to the data, after a slight growth of 1.3% in 2013, as of 2014, the deterioration of the economy begins with a decrease of 3.9%; as well as a fall of 6.2% in 2015.

Among the most striking of the statistics offered by the central bank was 2018's inflation rate of 130,060.2%.

The data release was mandated by the International Monetary Fund which threatened to sanction Venezuela with limitations on its Special Drawing Rights if it did not report updated macroeconomic data.

Given the acceleration of economic decline, it looks like the IMF may need to revise its most recent estimates of Venezuela's economic growth which can be seen in per capita GDP numbers. Here are the IMF's country-by-country estimates of GDP per capita, published using extrapolations from older Venezuelan data:


Source: International Monetary Fund.

Note the downward trend in Venezuelan GDP (the bottom dark blue line.) It now appears likely Venezuela's growth will need to be adjusted downward.

While the magnitude of the economic decline is remarkable, Venezuela's decline in relation to other South American nations is, by now, a well established trend.


While much of the continent has been undergoing significant growth over the past twenty years — especially in Peru, Uruguay, and Colombia — Venezuela has been moving in the opposite direction. Indeed, according to the estimates published before the release of the Venezuelan central bank's new data, the nation's per capita GDP declined 25 percent from 2008 to 2018.

The relative change has been less dramatic in more recent time frames. Brazil's growth dropped to zero between 2013 and 2018, and Argentina's growth turned negative. Both nations are notable for embracing highs-pending, high-inflation policies over the past decade. It remains to be seen if Brazil's and Argentina's more recent turns toward allegedly pro-market regimes can repair the damage.


Meanwhile, Venezuela has been notable for adopting an especially virulent type of socialism, even when compared to other leftist regimes, such as Bolivia and Ecuador. While Morales in Bolivia and Correa in Ecuador tended to be more pragmatic in their professed "socialism," The Chavista regime in Venezuela has doubled down on enforced "equality" through widespread expropriations and persecution of the productive middle classes.

The results have been disastrous indeed.

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Venezuela Needs Both a Political and an Ideological Change

05/03/2019Rafael Acevedo

As with everything in Venezuela, this week’s attempt at removing the Maduro regime was a mess. It seems to have had no coordination or logical planning. It consisted largely of opposition leader Juan Guaidó calling out civilians to support this attempt to take the control of the Venezuelan state, but with little effect. Some newspapers reported that Guaidó and ally Leopoldo López started to act before the plan was ready. Other sources say that high-ranking officers had negotiated with the U.S to keep Maduro in power. But one thing is sure: the current regime is still in place. Even more troubling is the fact some armored vehicles hit civilians that were on the streets protesting in favor of Guaidó. At the end of the day López with his family sought refuse in the Spanish embassy, and some military officers that were supporting Guaidó requested political asylum in Brazil’s Embassy. El Pais reports at least five people were killed in today’s chaos

Replacing the Current Regime with More of the Same?

Where to go from here? Venezuelans have suffered many disappointments, and there is a lot of skepticism in the population about the likelihood of replacing the current regime with something truly better. Here’s the problem: Venezuelans need to get rid of Maduro and his comrades, but we also need open the road to radical free-market reforms if they want to have a future with a long-run prosperity and liberty. In early March, Ben Powell and I wrote about this conundrum.

Unfortunately, the ideological fuel that would feed the engine of a new regime is not so different from the same that fed Chavez’s project. The “Plan País” supported by those seeking to topple Maduro is just another Keynesian recipe that will apply all the usual failed policies that have been used historically in Venezuela. In my country, this has only ever created a fake short-run “prosperity” which then creates cronyism, corruption, and an enormous states which owns of the commanding heights of the economy. In terms of human rights, a badly managed economy under some other group of hardline Keynesians might still be preferable to the current regime.

Nevertheless, at this time, it looks like an easy victory for replacing the Maduro regime with the opposition is not right around the corner. It looks increasingly like the best way to facilitate improvement would be for Guaidó and López to negotiate with Maduro for new elections, and more importantly to open the country to foreign capital yet again. With that in place there could be hope for an economic rebound. Of course, the government planners would still claim their intervention was the cause of the “economic miracle” that would come with stability, but we could at least hope for a gradual turn toward saner economic policy over time.

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