Tuesday, November 2, 2010

The Harmony of Interests of all Men: The Foundation of World Peace

Ludwig von Mises’s Liberalism:  The Classical Tradition is sold as a book primarily about the vital role that private ownership in the means of production plays in organizing society.  In fact, when I was reading book descriptions posted on the Ludwig von Mises Institute’s website in order to decide which books to buy, the selling point was that private property in the means of production is the cornerstone of a modern civilization.  To rid the world of private property is to condemn it to penury and want.  Instead of producing an earthly bliss, the world will retrogress into a barbaric state where the wants and needs of most people will remain unfulfilled.  Man faces a fork in the road on the highway of social philosophy; he has to choose which societal plan he wants to follow.  The two paths before him are to follow either his own plan or that of the state.  “Either a man is free to live according to his own plan or he is forced to submit unconditionally to the plan of the great god state” (Mises, “The Market” 44).  Private property in the means of production causes a society to organize around the fulfillment of the wants and needs of the masses as opposed to around the wants and needs of the state.  Private property is instrumental in creating a society in which the masses plan their own lives freely because the state is now in a subordinate position to that of the masses.  Unlike Marxist and socialist writers, Mises might argue sarcastically that the real “exploited class” is the owners of the factors of production, or the capitalists, not the workers (I say sarcastically because, in fact, Mises argues that there are neither losers nor exploiters under capitalism—everybody wins).  Capitalists cannot use their private property in the means of production to do whatever they want; they must produce whatever the masses, the consumers want them to produce.  As Mises writes, the capitalists are forced, if they want to keep their private property, to do one and only one thing, that is, satisfy the masses.

The owner of producers’ goods, the capitalist, can derive advantage from his ownership only by employing them for the best possible satisfaction of the wants of the consumers.  In the market economy property in the means of production is acquired and preserved by serving the public and is lost if the public becomes dissatisfied with the way in which it is served.  Private property of the material factors of production is a public mandate, as it were, which is withdrawn as soon as the consumers think that other people would employ the capital goods more efficiently for their, viz., the consumers’, benefit.  (Mises, “The Elite” 23)

Other systems of organizing society, such as communism, socialism, syndicalism (the factory is now owned and operated by the factory workers), and bureaucratization or interventionism in private businesses, all inherently attack private property in the means of production.  Private property in the means of production is outright confiscated under communism and socialism by the state.  Under syndicalism, private property in the means of production is also confiscated expect that under this system, the workers, not the state, seize ownership.  Bureaucratization and interventionism are the stealthy ways for a state to take over the means of production.  When private businesses are forced to comply with legions of regulators telling them what to do and what not to do, the private businesses are put into a position where they no longer are using their private property to satisfy the wants and needs of the masses.  Instead, the private businesses are now simply satisfying the wants and needs of the regulators from the great god state. 

In summary, to ensure that the means of production are used to benefit the masses, private property and the shifting mechanism of private property from one owner to another (i.e., the profit and loss system) must be preserved.  Without private ownership in the means of production, society will be under a state of planning or socialism where “the goals of production are determined by the supreme planning authority; the individual gets what the authority thinks he ought to get” (Mises, “The Elite” 26) and so, under this scenario, individuals are no longer free to choose anything in life.  All they can do is obey.      

This line of reasoning is not surprising, given the fact that Ludwig von Mises was an Austrian economist who taught graduate seminars at New York University and wrote prolifically on economic themes including a doctoral dissertation at the University of Vienna, a treatise on economics called Human Action, and his business cycle theory.  Yet, Liberalism:  The Classical Tradition is much more than a book on economic systems and the history of economic thought.  The book does much more than to provide a refutation of socialism and numerous warnings against the dangers of both the bureaucratization of private businesses and the interventionism of governments in business decision-making.  This book is much more than a review of the philosophy underlying capitalism.  The most profound theme is, however, that the harmony of interests of all men is the only way to achieve a lasting world peace.  Throughout all of Mises’s economic arguments, whether on labor market theory or on parliamentary democracy, one can detect this unifying humanitarian theme.

The world that Mises lived in when he wrote this book originally in 1927 was already soaked in blood and tears.  Earlier in his life, Dr. Mises experienced, as an artillery officer on the Russian front, the horrors of World War I.  Recalling Mises’s views on inflation (he called supporters of inflationary policies ‘monetary cranks’), he must have watched with horror the destruction brought about by the Weimar hyperinflation that was initially provoked by the invasion of Germany over its reparations default on January 9, 1923 (Engdahl 71).  In Liberalism, he also describes in rather graphic detail the evils of both communism and fascism in Europe.  He writes:

Only under the fresh impression of the murders and atrocities perpetrated by the supporters of the Soviets were Germans and Italians able to block out the remembrance of the traditional restraints of justice and morality and find the impulse to bloody counteraction.  The deeds of the Fascists and of other parties corresponding to them were emotional reflex actions evoked by indignation at the deeds of the Bolsheviks and Communists.  (Mises, Liberalism 28)

He also witnessed a Europe sharply divided into political party factions.  Mises stresses in Liberalism that, in fact, political parties started so that special interests could stop the classical liberal philosophy from taking root.  “All modern political parties and all modern party ideologies originated as a reaction on the part of special group interests fighting for a privileged status against liberalism” (Mises, Liberalism 123).  The goal of all political parties is “to obtain, at the cost of the rest of the population, the greatest possible advantages and privileges for the groups they represent” (Mises, Liberalism 136).  Classical liberal though abhors special interests and special privileges because it does not see groups, classes, or factions, just humans living on Earth who want to improve their lives.

This climate of bloodshed, war, hyperinflation, party divisions, special interests, and all around general suffering of the masses explains why Mises, in 1927, writes about the need for humanity to adopt the classical liberal principle of the harmony of interests of all men.  Mises pursues the idea of world peace not in order to win some philosophical debate regarding social organization but rather to achieve a desperately needed improvement to his current world conditions.  The passion with which Mises writes about world peace is a testament to his desire to improve his own situation and that of everyone else.  The lessons learned from Mises’s lived experience in the early half of the twentieth century are as relevant today as they were in 1927.

The unifying theme is what Mises calls the Montaigne fallacy, that is to say, “The profit of one man is the damage of another; no man profits but by the loss of others” (Mises, “Economics as a Bridge” 260).  Notice how every argument above, with the exception of Mises’s, that human interaction involves winners and losers—one party wins at the expense of all the other parties.  The communist and socialist argument assumes that the capitalists, or owners of the means of production, are “exploiters” who are profiting off their workers by paying the workers subsistence wages.  In other words, the capitalists win by making the workers lose.  Moreover, consider the argument regarding the political parties in Europe in the 1920s.  The party representing farmers, for example, wanted to enrich farmers at the expense of the rest of society.  In addition, consider the discussion regarding bureaucratization and interventionism.  The government can justify regulations by using an argument based on protecting the consumers from the unsafe products coming from manufacturers who are cutting corners.  In other words, the manufacturers are winning with higher profits at the expense of the consumers.  Trade union interventions, tariffs and other international trade barriers, central banking and the monopolization of credit, are additional examples of the Montaigne fallacy way of viewing the world.  All these examples assume that human interaction boils down to irreconcilable differences—one party is winning at the expense of all other parties.

The classical liberal school of though differentiated itself from all these other schools by arguing that this way of thinking about human interaction is destructive.  The Montaigne fallacy is, after all, “not a philosophy of social cooperation, but of dissociation and social disintegration” (Mises, “Economics as a Bridge 260).  Domestically, it produces infighting among groups such as farmers versus grocery store customers, unionized versus non-unionized workers, and workers versus capitalists.  Internationally, it produces infighting among nations over access to resources, to markets, and to labor.  Initially one group wins at the expense of all others.  The victimized groups, obviously, do not like this state of affairs and so they try to create a new situation where they win at the expense of all others.  This downward spiral is what Mises means by social disintegration. 

The solution to all of this social disintegration is to adopt the classical liberal view that human intercourse can be fashioned in such a manner that everyone wins.  The win-lose outcome of the Montaigne fallacy can be replaced by a win-win outcome if only the classical liberal philosophy were to be implemented.  To the classical liberals:

It seemed certain that mankind would advance to ever higher stages of perfection and that nothing would be able to arrest this progress.  They were firmly convinced that rational cognition of the fundamental laws of social cooperation and interdependence, which they had discovered, would soon become common and that thereafter the social bonds peacefully uniting mankind would become ever closer, there would be a progressive improvement in general well-being, and civilization would rise to ever higher levels of culture.  (Mises, Liberalism 120)

One of the best examples illustrating the feasibility of arranging human intercourse so that everyone wins is the example of how slavery ended in America.  In his critique of the presidency of Abraham Lincoln, Loyola College professor Thomas J. DiLorenzo, argues that it was not Lincoln but rather economics that liberated the slaves.  He succinctly argues that slave labor became less and less viable as it became less and less profitable.  The reason for why slave labor became less and less profitable is that slave labor is much less productive than capital or free labor.

The advent of the industrial revolution added economic pressures as well, for slave labor is inherently inefficient compared to free labor.  Slaves have very few, if any, incentives to work productively, to acquire new skills, and to improve their productivity levels, since they do not stand to benefit from doing so.  Furthermore, capital-intensive agriculture and industry began to render labor-intensive production, including slave labor, uncompetitive.  As the economist Ludwig von Mises wrote, “Servile labor disappeared because it could not stand the competition of free labor; its profitability sealed its doom in the market economy.  (DiLorenzo 47-8)

In this example regarding slavery, everyone—the slave owner and the slave—benefits from emancipating the slave.  The slave, naturally, is now a free man who can choose where he would like to work.  Moreover, the introduction of capital goods that DiLorenzo mentions suggests that the productivity of the worker will now be higher and so the real wage of the former slave should be higher than it was before.  The former slave owner also benefits because the use of free labor combined with capital guarantees much higher productivity and so much higher profits for him as well.

Another compelling example is the private property in the means of production example used at the start of this essay.  The profit and loss system is the great shifter of private property in the means of production.  If the capitalist fails to use his property in the best interest of the masses or consumers, then he will lose his property and will be forced to sell it to other capitalists who will then use it for the best interests of the masses.  The capitalist wins by earning profits but the capitalist can only earn these profits if he satisfies the wants and needs of the consumers or the masses.  The capitalist, therefore will win only when the masses win.  Therefore, if the profit and loss system is allowed to work freely without government bailouts and other forms of intervention, then the capitalists and the masses both simultaneously win.  No party is forced to lose under this scenario.  Foreigner nations are not burdened with losses from the government intervention of the tariff and so international strive is avoided.  Domestic strife is also avoided because rising profits allow the capitalist to invest in additional capital, which increases the productivity of labor and consequently increases the real wage paid to labor.  

In conclusion, the advantage of classical liberal thought over that of other schools of thought is that classical liberalism seeks to replace the Montaigne fallacy view of win-lose with its win-win view of human intercourse.  The implications of such a philosophy are staggering because it renders obsolete most of our current domestic and foreign policies.  So, why then has the world not adopted this philosophy yet?  After all, classical liberalism is today called classical because it is an old system of thought!  What is stopping the implementation of this system of thought?  Just as the world of 1927 did not listen to the voice of Mises and his contemporary liberals, so the world of 2010 is not listening to the voices of today’s classical liberals.  The news today is full of wars, calls for new wars, riots, austerity measures, protests, and airplane bombings so obviously something is not working—we are certainly not living in the world of economic prosperity and peace that was envisioned by the classical liberals.  In future blog posts I plan to address why classical liberalism has not been adopted by the masses and what can be done to help assist in its adoption.           

Works Cited

DiLorenzo, Thomas J.  The Real Lincoln:  A New Look at Abraham Lincoln, His Agenda, and an Unnecessary War.  2002.  New York:  Three Rivers-Random, 2003.  Print.

Engdahl, William.  A Century of War:  Anglo-American Oil Politics and the New World Order.  Rev. ed.  London:  Pluto, 2004.  Print.

Mises, Ludwig von.  “Economics as a Bridge for Interhuman Understanding.”  1945.  Economic Freedom and Interventionism:  An Anthology of Articles and Essays.  Ed. Bettina Bien Greaves.  Indianapolis:  Liberty Fund, 2006. 253-267.  Print.

---.  “The Elite under Capitalism.”  1962.  Economic Freedom and Interventionism:  An Anthology of Articles and Essays.  Ed. Bettina Bien Greaves.  Indianapolis:  Liberty Fund, 2006. 20-28.  Print.

---.  Liberalism:  The Classical Tradition.  1996.  Ed.  Bettina Bien Greaves.  5th ed.  Indianapolis:  Liberty Fund, 2005.  Print.

---.  “The Market and the State.”  1968.  Economic Freedom and Interventionism:  An Anthology of Articles and Essays.  Ed. Bettina Bien Greaves.  Indianapolis:  Liberty Fund, 2006. 41-45.  Print.

Sunday, October 17, 2010

Some Thoughts on Public Education

Our form of compulsory schooling is an invention of the State of Massachusetts around 1850.  It was resisted—sometimes with guns—by an estimated eighty percent of the Massachusetts population, the last outpost in Barnstable on Cape Cod not surrendering its children until the 1880s, when the area was seized by militia and children marched to school under guard.  (Gatto 22)
My Hypotheses

1.       Increased exposure to whole-word reading instruction (equivalently, a decreased exposure to phonics-first instruction) will cause a decrease in student vocabulary levels.  I based this on John Taylor Gatto’s book The Underground History of American Education (page 66) where he found, at the end of fourth grade, that an average student could read 24,000 words at ease if trained with phonics.  A similar student trained in the whole-word method would have 1,600 words memorized and would be guessing, usually unsuccessfully, at the other words.  I started with the whole-word method because of its prominent role in the history of modern public education.  I think that the whole-word method is the major cause of failure in modern education and all of the modern “techniques” and “reforms” are just various ways of masking this underlying problem.  By ‘modern public education,’ I mean the monopoly system of producing predictable stimulus-response trained students paid for by taxpayers without any choice.
2.       Increased student vocabulary will cause increased levels of knowledge.  I based this on Charlotte Iserbyt’s book The Deliberate Dumbing Down of America where she cited evidence that vocabulary is the key predictor of a student’s level of knowledge.  “Gaston nodded solemnly:  ‘Young people know fewer words than their fathers.  That makes them know less’” (page 105).
3.       Increased student knowledge will cause increased levels of critical thinking.  I based this on Dr. Maureen Stout’s (PhD, Education) book The Feel Good Curriculum where she explained why critical thinking is impossible without knowledge.  She wrote on page 28, “…the development of logical and analytical reasoning—critical thinking—is essential.  But of course we don’t just think in a vacuum (every try thinking about nothing?); we need something to think about; some subject matter to chew over; some body of knowledge that will put our brains to work.”
4.       Decreased ability to think critically will cause increased acceptance of the messages propagated by demagogues, for example, the acceptance of the hypothesis of man-made global warming.  I based this on M. Mihkel Mathiesen’s book Global Warming in a Politically Correct Climate.  The central thesis of Mathiesen’s book was captured by Dr. Zbigniew Jaworwski’s (MD, PhD, DSc) foreword to Mathiesen’s book.  Jaworwski wrote on page xiv, “Mankind is sometimes described as ‘anthroponemia,’ or the ‘cancer of the biosphere.’  This is caused by a number of modern irrational myths, which seem to have replaced the ghosts, haunted houses and witches of past generations.”  In other words, Dr. Jaworwski saw the retrogression of society back to the irrational past. 
5.       Decreased ability to think critically will initiate, through the Theory of Bureaucratic Displacement, a perpetual loop of falling academic standards combined with increasing budgetary expenditures.  The loop consists of the following items:  Less Critical ThinkingàFeel Good CurriculaàHigher Student EnrolmentàBigger Education Budgets to supposedly fix the initial problemàEven Lower Critical thinking. 
a.      I based this, in part, on Milton and Rose Friedman’s book Free to Choose:  A Personal Statement.  They wrote on page 155: In Chapter 4 we referred to the Theory of Bureaucratic Displacement that Dr. Max Gammon had developed after studying the British National Health Service:  in his words, in “a bureaucratic system…increase in expenditure will be matched by fall in production…Such systems will act rather like ‘black holes’ in the economic universe, simultaneously sucking in resources, and shrinking in terms of ‘emitted’ production.” 
b.      I also based this on Craig Brandon’s book entitled the Five-Year Party School in which he ascribed much of the blame for falling academic standards to the retention-driven funding model.  As such, no government educational bureaucracy will ever implement the proper solutions or reforms because to do so would render the bureaucrats’ jobs superfluous. 
c.      Finally, I drew upon Gary North’s article Digital Education vs. The Ruling Elite where he discussed why reforms to the current educational system do not and cannot work.        
6.       Demagogues manipulate the masses through the Montaigne Fallacy and the Fourier Complex.  A demagogue is defined as someone who appeals to the audience through emotions, passions, and prejudices and hence irrational arguments.  I propose that the demagogue will exploit the uncritical masses, the product of the education system, and will do so through the Montaigne Fallacy and the Fourier Complex. 
a.      The Montaigne Fallacy says that you lost because someone else won.  I took this idea from Ludwig von Mises’s article entitled Economics as a Bridge for Human Understanding.  He wrote:  The Leitmotiv of social philosophy up to the emergence of economics was:  The profit of one man is the damage of another; no man profits but by the loss of others.  This is not a philosophy of social cooperation, but of dissociation and social disintegration.  For the sake of expediency, we call this doctrine after its proponent, essayist Michel Eyquem de Montaigne (1533-92).  In light of this Montaigne fallacy, human intercourse cannot consist in anything but the spoliation [plundering and pillaging] of the weaker by the stronger.
b.      The Fourier Complex says that you should not blame yourself for your losses in life but instead you should use the world or society as your scapegoat.  I took this idea from Ludwig von Mises’s book Liberalism: the Classical Tradition page xxx.  Mises wrote:  The neurotic clings to his “saving lie,” and when he must make the choice of renouncing either it or logic, he prefers to sacrifice logic.  For life would be unbearable for him without the consolation that he finds in the idea of socialism.  It [socialism] tells him that not he himself, but the world, is at fault for having caused his failure; and this conviction raises his depressed self-confidence and liberates him from a tormenting feeling of inferiority. 
7.       To remedy the felt inequities produced by both the Montaigne Fallacy and the Fourier Complex, the demagogues will propose government interventions in the economy as the ‘magic solution’ to all problems.  I built on an idea from Ludwig von Mises’s article entitled Small and Big Business.  I drew upon his history lesson regarding the German ‘majority socialist’ philosophy from 1918-1919, viz. socialism was now to be implemented in Western nations through planning as opposed to through nationalization.
8.       Government intervention will undermine social harmony and social cooperation.  Government economic intervention leads to privileges being handed out to connected insiders (cronyism) and to factions fighting for power (the so called ‘doctrine of force’).  This undermines the proper functioning of a society.
9.       By undermining social harmony and cooperation, society fails to achieve its full material potential because the division of labor can no longer function properly.  I drew on a number of works here, but the most colourful example is Ludwig von Mises’s history lesson in Liberalism:  the Classical Tradition (page 21) on the economic impact that a repeat of the Wars of the Roses [English civil wars] would have on today’s economy.
10.   As society gradually loses the benefits of the division of labor, there will be calls for more government intervention in the economy.  Moreover, the falling standard of living will provide more evidence for demagogues trying to sell the population with the Montaigne fallacy and the Fourier Complex.  Hence, there is a built-in self-reinforcing mechanism in this Zwangswirtschaft scheme of planning.  In his article entitled Socialism, Inflation, and the Household, Dr. Mises saw this process working through calls for more government fiscal spending paid for with unsound monetary policies.       

Saturday, October 9, 2010

Preliminary Thoughts on Man Made Climate Change 1

“A man who could monopolize the atmosphere or drinking water could undoubtedly force all other human beings to obey him blindly.  Such a monopoly would be unhampered by any competing economic agency.  The monopolist would be able to dispose freely of the lives and property of his fellowmen” (Mises, Socialism 344).

The science relating to carbon dioxide as the major man-made driver of global climate change is supposedly settled and undeniable.  We are told that the case is closed.  The world is doomed, we are told, if we do not submit to the latest IPCC edict from on high.  Even a cursory review of the literature reveals that the case is not closed and the science is not settled.  For example, Singer and Avery, citing Veizer, state that, “empirical observations on all time scales point to celestial phenomena as the principal driver of climate…with greenhouse gases acting only as potential amplifiers. … The tiny carbon cycle is piggybacking on the huge water cycle (clouds included), not driving it” (36).  Spectacular claims, such as the disaster of rising sea levels near Tuvalu necessitating the relocation of the entire population of the island have turned out to be false.  In fact, “things are bad on Tuvalu, but not because of rising seas.  In fact, sea level in Tuvalu has been falling—and precipitously so—for decades” (Michaels 204).  Obviously, something is wrong when a little fact checking easily disproves the stories reported in the press.     

To try to understand what is really going on, the history, or to be precise, the “deep history” pertaining to this man-made climate change issue must be explored.  The phrase “deep history” refers to a phrase used by Peter Dale Scott and means “a chronology of events concerning which the public records are either false or nonexistent” (267).   Incidents, such as the politically driven DDT ban in 1972, which causes approximately five million deaths per year (Mathiesen 23, 26) or 50 million deaths in aggregate since the ban (Driessen 66) and the recent Climategate email revelations justify using this “deep history” approach.  Consequently, I approach this issue from the point of view that issues such as buying energy efficient furnaces, using fluorescent as opposed to incandescent light bulbs, and reducing carbon footprints are all just distractions from the deeper—and more sinister—issues underlying this debate.     

Mathiesen’s review of the history of environmental campaigns, starting with DDT’s, shows that these movements follow a “nearly identical pattern, as though they had been scripted and choreographed” (15).  The time sequence pattern begins with scaring the public about a pending crisis based on reporting a kernel of truth.  This approach, reminiscent of Kurt Lewin’s “unfreezing” stage in planned organizational change (Schermerhorn, Hunt, and Osborn 397), sets the stage for planned change by creating a felt sense of urgency.  Mathiesen (15) emphasizes that the story is always told in “very simple terms” (15) and hence is presented in a way that is accessible to the intellectually dependent people produced by public education (Gatto 7-9).  Then, a media and political campaign that hammers away at the kernel of truth to be found in the initial scare is launched.  A key component of this campaign is that all contradictory evidence is both suppressed and ignored (Mathiesen 16).  Next, legislation is enacted and finally the process starts all over again with a new scare (Mathiesen 15-16).  The common culprit is always economic growth or industry and the solution is always etatist or statist in nature.  The solutions include redistribution of wealth (Mathiesen 15, 17), trade protectionism and the abandonment of the international division of labor (Driessen 108-109), and global bureaucratization of the economy.  Driessen summarizes the nature of this global bureaucratic proposal succinctly as:

A massive bureaucracy, largely devoid of checks and balances, ensconced primarily in the EU and UN, fed and nourished with billions in tax dollars.  The new bureaucracy would hold unprecedented power to control decisions by nations, states, communities, businesses and individuals—over energy, economic, housing, transportation and numerous other matters.  (110)

The resurrection of Malthusianism in the 1970s launched the scare campaign.  Thomas Malthus’s 1798 contribution to this debate is his “law of geometric progression,” the view that “human populations invariably expanded geometrically, while the means of subsistence were arithmetically limited, or linear” (Engdahl 147).  Colloquially speaking, Malthusianism is the view that the Earth has too many people and is running out of the resources needed to maintain this current population.  One of the important foundational documents regarding the adoption of this Malthusian viewpoint is the 1974 National Security Council Study Memorandum 200, issued by national security adviser Henry Kissinger (Engdahl 148).  Another document issued at roughly the same time is Paul Ehrlich’s The Population Bomb.   The basic program can be summarized as follows:

Our position requires that we take immediate action at home and promote effective action worldwide.  We must have population control at home, hopefully through changes in our value system, but by compulsion if voluntary methods fail.  Americans must also change their way of living so as to minimize their impact on the world’s resources and environment. […] The birth rate must be brought into balance with the death rate or mankind will breed itself into oblivion.  (Ehrlich xii)

Malthus’s original prediction proved wrong because his argument ignored “the contribution of advances in science and technology to dramatically improving such factors as crop yields, labor productivity and the like” (Engdahl 147).  Not surprisingly, technological progress is raised today in objection to current Malthusian arguments (Driessen 26, 108; Singer and Avery 250-251).  Ehrlich’s concern about man “breeding himself into oblivion” is conceptually just a restatement of the fears coming out of the Marxian “iron law of wages” in which Marx feared that man would “breed himself into perpetual poverty.”  Marx feared that man would never be able to rise above the subsistence wage because he would keep breeding the second his wage rose above that of subsistence and the resulting additional supply of workers would bring his wage back down to the “natural” level.  The erroneous assumption of both Ehrlich and Marx is that they both assume that man is an animal driven by instinct and not by his ability to choose between alternatives.  Man can choose not to have children. 

The essential shortcoming of the “iron law of wages” was that it denied to the wage earner his human character and dealt with him as if he were a nonhuman creature.  In all nonhuman living beings the urge is inwrought to proliferate up to the limits drawn by the available supply of the means of subsistence.  Nothing but the quantity of attainable nourishment checks the boundless multiplication of elephants and rodents, of bugs and germs.  Their number keeps pace with the available aliments.  But this biological law does not apply to man.  Man aims also at other ends than those involving the physiological needs of his body.  The “iron law” assumed that the wage earner, the common man, is no better than a rabbit, that he craves no other satisfactions than feeding and proliferation and does not know of any other employment for his earnings than the procurement of those animal satisfactions.  […] If he earns more than the absolutely required minimum, he spends it upon the satisfaction of his specifically human wants; he tries to render his life and that of his dependents more civilized.  (Mises, The Marxian Theory 145)   

The ultimate problem, as I see it, is that the real agenda here is to establish a centrally planned economy on a global scale.  This plan seems to be built upon an assumption that people will make bad decisions regarding the usage of resources if they are not told what to do and upon an assumption that markets are unable to allocate resources wisely.  Proving the impossibility of centrally planning a national economy was the task that Ludwig von Mises embarked upon in the early 1920s.  Applying Mises’s general thought process (Mises, The Why of Human Action 62-63) to what these global planners want to do, the first major problem is that central planning will result in more and not less waste of factors of production.  In other words, the call for sustainable development (Driessen 20) cannot be achieved through central planning because the use of central planning will negate the initial goal that sustainable development seeks to achieve.  The second major problem that our modern central planners face is that they want one and only one global solution.  When Mises and his fellow collaborator, Nobel Prize winning economist F.A. Hayek were formulating this “economic calculation” argument back in the 1920s and 1930s, the central planners back then had a sneaky way of dodging the problem, viz., they could utilize prices determined on the markets of non-socialist countries.  By insisting upon a global solution, our modern day planners will deny themselves access to this price information and so they will be hopelessly paralyzed.  The global economy will grind to a halt because our planners will be clueless in their operating of the entire global economy (Mises, The Why of Human Action 62-63).  The more economic allocation powers granted to this global power, the more paralyzed it will become because it will have less and less price information in which to make rational decisions. Of course, if one believes in Malthusianism, then one will want this global solution because the ensuing global economic collapse will, to be sure, facilitate a substantial drop in population.        
In conclusion, the call for a global solution will not work because it will create a “paradox of planning” problem and hence must collapse if implemented.  The Malthusian assumption underlying this solution is wrong as demonstrated by history.  Man is not going to breed himself into oblivion because rising real wages encourage people to improve their standard of living and not to breed perpetually.  The use of psychological techniques to manipulate and scare the pubic into adopting this solution is, unfortunately, all too common when dealing with governments.  The solution to this problem starts by removing state control from education.  When people can think for themselves, as opposed to being simply conformists, they will soon realize how they are being manipulated by the media into believing this far-fetched story that man-made carbon dioxide is destroying the world.       

Works Cited

Driessen, Paul.  Eco-Imperialism:  Green Power Black Death.  Bellevue:  Free Enterprise, 2004.

Ehrlich, Paul R.  Prologue.  The Population Bomb.  By Ehrlich.  Cutchogue:  Buccaneer, 1971. xi-xii.

Engdahl, William.  A Century of War:  Anglo-American Oil Politics and the New World Order.  Rev. ed.  London:  Pluto, 2004.

Gatto, John Taylor.  Dumbing Us Down:  The Hidden Curriculum of Compulsory Schooling.  Gabriola Island:  New Society, 2008.

Mathiesen, M. Mihkel.  Global Warming in a Politically Correct Climate:  How Truth Became Controversial.  Lincoln:  iUniverse Star-iUniverse, 2004.

Michaels, Patrick J.  Meltdown:  The Predictable Distortion of Global Warming by Scientists, Politicians, and the Media.  Washington:  Cato, 2007.

Mises, Ludwig von.  “The Marxian Theory of Wage Rates.”  Economic Freedom and Interventionism:  An Anthology of Articles and Essays.  Ed. Bettina Bien Greaves.  Indianapolis:  Liberty Fund, 2006. 142-147.

---.  “The Why of Human Action.”  Economic Freedom and Interventionism:  An Anthology of Articles and Essays.  Ed. Bettina Bien Greaves.  Indianapolis:  Liberty Fund, 2006. 59-65.

---.  Socialism:  An Economic and Sociological Analysis.  Trans. J. Kahane.  6th Rev. ed. Indianapolis:  Liberty Fund, 1981.

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