Voluntary Exchange

From: Technotranscendence (neptune@mars.superlink.net)
Date: Thu Dec 27 2001 - 20:15:06 MST

On Sunday, December 23, 2001 1:23 PM Smigrodzki, Rafal
SmigrodzkiR@MSX.UPMC.EDU wrote:
>> Which of these examples started off relatively noncoercively and
>> when?
> See examples above (Native....etc, recently, last 5 000 to 500 years
> ago, and Europe, many thousands of years ago).

Aren't you making the assumption here that if a society gets a
government, then this must have come about noncoercively? Or that if
coercion occurs, this must have its roots in noncoercion?

Remember, your model is basically that people noncoercively get a
society they would not like -- or most members would not like and that
pretty much amounts to a form of oligarchy. Is your arguments that each
step of the way, hunter-gatherers moved noncoercively to agriculture and
then to government and then to empire and so forth?

And do you also think this means government is okay?

>> Latin America, e.g., started off with the Spanish and Portugese
>> empires and though most of it is now democratic states, the basic
>> social system leaves much of the imperial systems locked in.
>> Recall the de Soto book discussed many weeks ago? One of
>> his main complaints is that voluntary
>> systems in Latin America -- the "informal economy" -- is still
>> largely illegal. Legalizing it would allow people to do their own
>> thing -- still no correcting all of history, but letting them get on
>> bettering themselves through longer range planning, wealth
>> accumulation, and trade.
> But with no money and no land, your voluntary activities are
> limited. Why should the landowners allow competition if they can get
> away with suppressing it? Their situation is not an argument against
> government per se, but against government as it is now. No surprise
> armed uprisings occur so frequently.

Indeed, but what's your point? Is it that a free market causes this
phenomena because it's being surpressed? If so, this is a highly
unusual attack on free markets.

If instead, you mean those big Latin American landowners got their land
through a free market, then surpressed it, then this is actually wrong.
They got it either because they or their ancestors stole it or because
the current governments gave it to them (e.g., in payment for favors or
to hurt their enemies or to keep rebellion down). Again, we're no
dealing with an example of your model in action, but of governments in
action, specifically the Spanish imperial government of old and its
modern descendants.

Also, what do think the solution is to the problem de Soto has outlined?
More government controls, less freedom, less capitalism? Or his
solution: recognize the property titles, loosen controls, and allow
people to carry out these informal transactions openly without fear of
persecution? If you opt for the former solution, then you'll just
repeat every wave of reform in the Latin America, which only leads to a
new ruling clique and the need for another wave of reforms in a
generation. If you opt for the latter, these people can get on with
their lives and unlocking their economic potential will help even First

>>> Only revolutions and
>>> technical developments break such states, forcing some
>>> redistribution of inherited wealth, as opposed to earned
>>> wealth
>> Not exactly true. Social changes apart from technology often
>> play a big role -- and technology is only one factor among many.
>> Let's no reify it.
> Not exactly, but *mostly* true (or else - can you substantiate the
> claim that, historically, non-technology driven, voluntary activities
> led to the decline of most feudal states?)

Yeap. The fact that the three separate military challenges -- the
Norse, the Hungarians, and the Moslems -- to Western Europe stopped by
about 1100 AD (the Hungarians much earlier, the Moslems much later;
source Ernst Bloch's _Feudal Society_ Vol. 1) allowed villages and such
to start trading again and for culture to spread without fear of raids
and the like. This allowed the rise of cities and the division of labor
and knowledge on which future advances would be made.

Note: I'm not saying technology played no role, but just that it's not
the whole shebang. Also, I did not write "voluntary activities," but
"[s]ocial changes apart from technology..."

Another example, from before the Middle Ages. The barbarians that
conquered Rome were not technologically superior to the Romans. In
fact, it was Roman decline that led to barbarian advance. You have to
ask why Rome declined. Did technology do it in? I suspect not. Yet
its decline led to redistribution of wealth.

>>> (a very important distinction - I am in favor of the
>>> inherited wealth redistribution but largely against
>>> redistribution of earned wealth),
>> If people earn their wealth, by your lights, can they generally
>> do what they want with it? If so, then why can't they give it to
>> their heirs -- whoever they choose these to be?
> No, they can't do what they want. E.g. they may not hire private
> armies to fight private wars (as in XVI century Poland, not long
> before that state's collapse), or build family estates rivaling the
> state in the ability to coerce poorer citizens.

I believe you understood the context here. I meant do what they want as
long as it harms no one else. In other words, you can do what you want
with your baseball bat, but you can use it to beat your wife to death.

But you did not adopt some libertarian standard here. You said you are
"in favor of the inherited wealth redistribution but largely against
redistribution of earned wealth." What are the limits of inheritence by
your lights and why do you differ this from earned wealth? After all,
even in your model, someone could, theoretically, earn the whole
planet's land. What are the limits you place on redistribution
generally and why? I mean why place limits? Why not either have no
redistribution or arbitrary redistribution? By what method do you
decide? (Do you realize too that redistribution by a third party -- a
government -- will lead to distortions and to people wanting to capture
governmental power to benefit themselves or hurt their rivals through

> So what is better - a feudal system, or a democracy (on average)?
> What percentage of young men in a mature democracy are killed
> in wars
> started by the democracy, as compared to kill ratios in feudal or
> slave states, and the ungoverned tribal societies?

It would be much higher than kill ratios for modern democratic states
(and I include all the spawns of democracy in this). See John F. C.
Fuller's _The Conduct of War_. Predemocratic era -- pre-19the
century -- wars were generally small affairs. Even the Seven Years'
War, the last of the major predemocratic wars (really Britain was a
protodemocracy at the time AND) and considered _the_ World War of the
18th century. Even during this time, a notable English actor was able
to travel between London and France and be greeted by cheering crowds on
both sides of the channel.

Check out the figures at http://users.erols.com/mwhite28/warstat2.htm ,
on the 20th century alone. The number killed by states not even at war
alone is staggering.

The difference? Warfare under democracy has become total war. The
whole of society is considered part of the war, while predemocratic era
societies generally viewed war as the game of kings and the elite and
limited to a small class of militarists. (There was also no draft and
kings often had to beg for funds or sell or borrow to pay for wars.
Modern democracies do not do this.) So, the whole of society is both a
resource and a target. Now, war is basically seen as ideological.
(Witness the recents wars in Serbia and Afghanistan.)

>> I don't think this will be the outcome for the above state reasons.
>> This scenario has never played itself out without coercion involved
>> every step.
> It did again and again - with coercion spontaneously developing as
> the main modality for social control, only much later mellowing to the

> level of modern US.

Coercion, especially government coercion was involved in the modern US.
Give other examples, don't just assert.

>> Note also what you're implying: we need to give up freedom to protect
>> freedom.
> The only truly socially free man would be a lonely man. As with
> investing money, so it is with freedom that you have to prudently give
> away some, to get more in return. With the emphasis on "prudently".

Who decides what's prudent? How do you know? What happens if you give
up too much? Why not allow people to decide what to do voluntarily?
How would you impose your views?

>> Actually, that would lead to economic ineffiency by not permitting
>> certain voluntary arrangements.
> It would stop exactly the voluntary arrangements which if unchecked,
> result in the above scenario.

See below.

>> Also, the tax money itself will be
>> wasted on something the taxed did not want, further distorting
>> the economy.
> The (land magnates) taxed here want to rule the world - it's good to
> keep the economy free and efficient by stopping them.

Inside the confines of your model, but only with your unrealistic
assumptions. For example, a tax on land would make it easier for the
biggest owners to pay, but not for more marginal ones. This is why you
get some big corporations today supporting taxes. Yeah, the taxes will
bite into their profits, but they were bite into their competitors as
well. The bigger business might be able to survive a bigger bite, where
a smaller one cannot. In all likelihood, this kind of tax you propose
would only do that.

If you offer the tax would only be on the big guys -- or on farms over a
certain size -- then you prevent the potential for economies of scale to
be tested as they arise. In effect, you make for less social wealth
production, hurting the whole society. (What are the huge farms going
to do with their land, btw? Look at it? They'll have to grow and sell
or they won't be able to sustain themselves or continue the expansion
you assume.)

>> Finally, an agency strong enough to enforce it would be a
>> threat to the society it existed in. There would be no reason to
>> its power would be limited to just keep your model going.
> Yes, here we agree - a government is a very dangerous beast. Every
> citizen has to be aware of the danger, and with stupid or immoral
> citizens (=willing to use the government to get a bigger slice of a
> smaller pie), results are bad.

Of course, but making sure citizens are not stupid or immoral is a task
you can't do through democracy. In fact, democracy helps to reinforce
those vices where it does not bring them into being. (Once people find
they can vote to get what they want, rather than work for it, what do
you think will happen? Well, just what has happened!)

>> But you haven't shown why this wouldn't happen spontaneously. After
>> all, most people want better choices and those who can give them to
>> them often make a nice profit. Why would not this dynamic provide?
> Why, you haven't described in detail (and with historical examples)
> how the spontaneous process would happen.

Simple. Have a free market in your model. If people have varying
tastes, resources, and talents, then people will compete to provide each
other with goods and services. Since those who succeed are rewarded and
those who fail are not, resources move into hands better able to use
them -- the innovators, the competent, and so on. If members of the
later group become lax, resources move into more able hands -- i.e.,
there's no standing still if you want to be on top or stay in business.

This is exactly how markets have progressed in reality.

Also, science moves by basically the same model -- individuals
spontaneously come up with new theories, experiments, and the like.
Others decide if they want to accept them. There is no command economy
like socialism in scientific progress. Nor is there any democracy. You
don't vote on whether Einstein's STR or GTR was right or wrong. (In
fact, those who believe STR or GTR wrong have their venues and continue
to write, speak, debate, publish, etc. There's no need for suppression
of even wrong ideas.) Imagine if science were done by vote instead of
the free acceptance or rejection of ideas. If ideas and even research
programs were a matter of voting, I think science would come to a
screaching halt and Eleizer would have to forget about his work -- or
campaign for it and hope he can get a majority to agree.

>> So am I. However, I'm generally against all coercive interventions
>> society, from subsidizing small farms to taxing big ones to stealing
>> inherited wealth. I also don't see how a government is somehow
>> That just institutionalizes coercion with no guarantee the government
>> won't just grow and grow and grow.
> As I said above, I am scared and distrustful of government, too, but
> I do believe that the alternatives (barring some very special new
> technological advances) are worse. And there is one guarantee
> against the jackbooted gov't thugs - a smart and ethical citizenry.

I submit if you have such a citizenry, you don't need a government.
Also, absent such a citizenry, how do you prevent the unethical and the
stupid from becoming part of or supporting the government? It would
seem like you are on the horns of a dilemma here.

> The only basis for coercion is the need to protect innocent life-wish,
> protect truth, and protect freedom - all of these are code phrases for
> very complex memes, which I would be happy to discuss, if you wish.

Fire away!

Daniel Ust
    My "Love in Ancient America," a poem recently published in _The
Thought_, is now at:

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