Leave Apple alone!!

A law by which anyone can be found guilty is no law at all.

Walter Block's joke about antitrust goes like this.  Three men were sitting in prison, inmate 1 asks inmate 2 "what are you in for?"  "The government said I was guilty of price gouging for charging over the market price".  Inmate 1 then he asks inmate 3 the same question; he replies "well, I was guilty of charging under the market price so I was arrested for predatory pricing."  They turn to inmate 1 who confesses, "I was arrested for charging the market price and am accused of collusion and cartelizing."  Antitrust is a sham, and sometimes I feel like slapping Teddy Roosevelt right off Mount Rushmore.

Apple is under attack again by the FTC.  What are they guilty of?  How about being awesome?  Even if you don't like Apple, there's no reason for this.  Apple has built an amazing infrastructure for distributing digital content, they have built amazing hardware to play it back on, and one can argue they have even made Apple into an ethos.  Despite the competition, and some higher performing hardware (like some 4G phones) it continues to dominate the market.  All Apple actors (consumers, producers, and developers) have come to the Apple platform voluntarily.  App makers could abandon iTunes altogether and develop solely for the Android.  If Apple's fees and app regulation are so onerous, why don't they?  Well, I suppose if they do become unbearable then the developers and consumer will abandon Apple because it's voluntary and not compulsory like some other organization I know.

Whatever you think of Apple, in no way does the FTC have a right to tell them how to run their business.  Besides the obvious reason that no injustice has occurred, the government is the worst offender of antitrust principles.  The government claims monopoly privileges for itself.  It claims the right to prevent any and all private participants from entering the market.  Antitrust supposedly protects the public from monopoly activity, high prices, and lack of competitive options in an industry.  This is exactly what the government claims must exist in every area it over sees.  The FTC itself claims the right to regulate commerce and to extract whatever funds it needs for its operations from businesses and the public.  It is sick that this kind of double speak is allowed, and that companies like Apple and the public at large suffer because of it.

Admittedly, a lot of what's said at LewRockwell.com is unlikely to attract the non-libertarian to libertarianism.  Knowing this full well, I loved this post back in June about bureaucrats being upset about their crummy government issued blackberrys (blackberries?).  What I found interesting about the post, factually, is that Apple has a relatively small lobbying budget.  I don't know if Google's and Microsoft's lobbying power has anything to do with the FTC investigation, but how sad would it be if millions had to be spent on lobbyists just to avoid expensive government investigation?  Ron Paul doesn't get visited by lobbyists because his exercise of government power is minimal and thus provides no incentive for the corporate lobbyist.  Leftists who claim to protect the public and are all too willing to use government power are also too easily duped into furthering the goals of one corporation over another thus extending and strengthening fascism in America.  Albert J. Nock once believed the state was an effective force for helping the weak, but he soon realized that not only was the state's modus operandi completely unjustifiable -- "rooted in conquest and confiscation" -- but it was the least effective tool to help those whom he cared to protect.

Fallout New Vegas

The blog will get a little less attention than it's been getting because I've started Fallout: New Vegas.  My last Fallout character sucked up 65 hours of my life.  In keeping with my libertarian convictions I plan on helping out the self-governing, non-militant, state free societies factions.  The New California Republic (NCR) for example will have a hard time finding a friend in my character.

Statehood is only viable when the productive capacity of a people can support the parasites of the state.  Small towns, tribes, and our ancient ancestors were stateless for this reason.  Slaves are desirable because their output is greater than their consumption, if a slave only produced as much as he consumed then there would be no point in having a slave.  Similarly, the state exists when production of others is great enough that it can support a state and when the state's burden is small enough as to prevent an uprising.

These ideas were most recently brought my attention by Jeff Riggenbach when he reviewed this book in his "The Libertarian Tradition" podcast: "The Art of Not Being Governed: An Anarchist History of Upland Southeast Asia" by James C. Scott.  Riggenbach's only complaint is that Scott does not distinguish between government and the state.  If you've read "Our Enemy the State" by Albert J. Nock then you'll be able to sort out the differences and not be confused by this otherwise great book (according to Jeff Riggenbach, I haven't read it).

Republicans and Democrats

I've heard libertarians say that there's no difference between left and right.  I disagree, here's the difference:

The right are disingenuous about fiscal and regulatory policy
The left are disingenuous about foreign and social policy

If only the opposite were true, and if good policies had more staying power than bad policies, America would be fairly libertarian country.  And of course there's no difference between Obama and Bush, McCain and Dodd, Romney and Jerry Brown.

The ends justify the means?

The following 3 paragraphs throw out some concepts to consider and then a more cohesive thoughts in 4th.

Whenever arguing foreign policy, welfarism, the nanny state, or whatever our wise overlords (TM, Tom Woods) might be getting us into, we have to ask "what is moral?".  Preventing someone from jumping off a building is moral, but not if it means pushing 10 people off the building to distract the one you're saving.

Walter Block (yes, I'm citing him again) takes the side of deontology.  That is, if you have to kill one person to save 10, what is moral?  Deontologically speaking (actions and not results define morality), it's not okay to murder so it's immoral to kill the one.

The issue gets a little muddier when you consider the "initiator of aggression".  A store owner who kills an innocent bystander because he's defending himself during an armed robbery is not responsible for the death of the bystander, but the robber who initiated aggression.  Muddier yet, Nazi prison guards who claim to have saved Jews by not killing as many as their ruthless fellow Nazi are still responsible for the lives they ended.  And as a final example, consider "Lost" the TV show when Mr. Eko had to kill to save his village, in this case you might argue the one who gave the ultimatum is initiating the aggression so isn't the person who pulled the trigger only a proximate cause of death?  I include these ideas for completeness, but are extreme and rare examples of moral choice.  In most cases it's easy to delineate the aggressor for the victim.

So what does this have to do with helping the least among society?  (this is supposed to be part 2 of the answer).  I'm not interested in helping the disabled if it means pushing people off of buildings.  That is to say, I cherish basic morality above the extension of morality: altruism.  Since yesterday was Valentines day, let's say Fred forgot to buy flowers.  Since he loves his wife he wants to do something and sees Tom with a bouquet of roses walking down the street.  Fred's love for his wife motivates him to stab Tom, take the flowers, and give them to his wife.  One response would be, "what a loving husband, he's willing to kill for his wife."  Fred has just used the political means (using Oppenheimer's definition) to provide a gift.  I'm repulsed that anyone would praise Fred and I am equally repulsed by those who say "Obama cares about the less fortunate".  Tom is foremost a murderer and a thief.  And I say this with some hesitation since the Patriot Act just got extended, likewise Obama is foremost a murderer and a thief.

There are rationalizations (not good ones) for taxation and offensive wars.  Taxation and market regulation are the main issues for this topic.  These rationalizations are built on economic fallacies, namely the static wealth pie.  That is, to the political scientist, there is a fixed amount of wealth in the world and it is the job of the political hack to figure out the best way to divvy it up.  This ties in well with my last post so I won't belabor this point.  Industrialization, contrary to what Upton Sinclair, lifted people out of poverty; there is vastly more wealth now then there was 200 years ago.

Sure, there is a fixed amount of natural resources (not including cosmic sources like the sun, which I suppose is fixed too), but they don't count as wealth unless they are transformed into something useful.  The ones who create wealth are those who homestead the natural resources.  When they transform them into something that serves the needs and desires of others they can accumulate capital with their profits and expand operations.  Those who do not satisfy the needs of others go out of business or their operations are severely limited.

When we take the issue of "divvying up the pie" back to homesteading we see that there is no aggressor, only voluntary interactions in the accumulation of wealth by the economic means.  Therefore, we conclude any confiscator of private property (including wages and profit) is the immoral aggressor.  Anything he does with the stolen loot should not be heralded as humanitarian any more than Fred's flowers show an act of love.  True love, true humanitarianism can only come by the economic means.  Serve others by trading, entering into contracts, and working.  Any use of the political means negates any positive outcome because it leaves another party violated.

I've spent two posts on "negative statements" or reasons to not worry yourself about the poor and disabled, that there are more fundamental problems to worry about.  I won't promise that the 3rd post will be much different but I'll try to include some positive statements.  I can't prescribe too many positive statements because no market anarchist pretends to know how the market ought to work (except free of the state), all I can do is propose how things MIGHT work.

Nature's default

This is the first of a 3 part post on supporting the least among society.

I stole this idea from Tom Woods, and if you're interested I could probably dig up the video somewhere.  He asks what the world (as in nature) hands us at birth?  What were our ancestors and ancient ancestors given at birth?  The answer is nothing except parents, and the parents were given nothing except their parents ad infinitum (at least practically).  Nature provides us with nothing -- it does not clothe us or hand feed us -- and so nature's default position is poverty.

Our parents give us food and shelter, but what are they entitled to?  What food can they eat?  Cavemen were not handed food stamps redeemable at Walmart.  They lived in grinding poverty, constantly searching for food, not eating for days, and their children after breastfeeding did likewise.  They lived in tribes, were hunters and gatherers.  They survived but not very luxuriously.

If cavemen got together and developed a constitutional republic they would still be in poverty because governments produce nothing.  Even what governments "provide" they do so by stealing, not by trading.  Only producers, the division of labor, and trade could lift humanity out of poverty.

We live in a world of abundance; this much human life could not exist without it.  What we call "poverty" is not even close to the default position of nature.  Perhaps it is in some parts of Africa, but in the United States the cavemen would laugh at us for where we put the poverty line (e.g. a family of 3 making $18,310 or less per year).  It's a shame that some people live in leaky apartments, but my mother-in-law, just a few decades ago, lived without in-door plumbing and was not considered impoverished.  Calling something "poverty" does not justify theft from the non-impoverished.  The term itself is subjective and relies on comparing the well being of some to others.  This subjectivity of poverty and thus the "necessary" welfare is partly why I oppose the state's efforts to help the less fortunate.  I don't want people to live at the default position of nature, but I see no justification in using the threat of violence to make me help anyone rise above that.

What I'm trying to do here is draw an absolute or at least a baseline: Poverty is nature's default position for mankind.  In my opinion, if you want to help the poor then end the regressive burden of government.  End the drug war that destroys poor families, end sales and sin taxes which are regressive, end minimum wage that necessarily unemploys the poor, end the Fed and inflation that steals wealth from the elderly and cash based families, end all foreign wars that steal the young from the poor (admittedly, we have a volunteer Army, but the poor would be in much safer occupations), end foreign aid to kleptocracies, end the corporatist distribution of wealth from the poor to the rich, end our militarized police force, and most importantly end the state.  For more on the regressive burden of government, check out Chapter 8 of Murray Rothbard's "For a New Liberty".  Also in there is the Mormon Church's excellent model for a welfare program.

Populations models and Minimum wage

I'm holding off on my Liberty vs Utilitarianism post for which I needed the definitions in my last post.  I also wanted to subtitle this post "How to convince a liberal engineer that minimum wage is bad".

Walter Block has many of his talks and guest appearances on the Mises Torrent (should try to add a link for that).  For the second time now, I've heard him debate this hack, Jared Bernstein, on minimum wage.  At the beginning of one of these debates, Walter lays out the logical conclusion that 1) it is not an employment law, namely it doesn't say that so and so must be hired, but it is inherently an unemployment law, it says it is illegal to hire someone below some dictated amount.  And 2) it increases employment higher than it would other wise be. This second point is what I want to focus on and the wording is very important.

Bernstein comes back with something like, "if Walter's simplistic theory actually were true then this would be a closed and shut case, but it isn't.  When you look at the data, moderate increases in the minimum wage do not result in more unemployment".  Walter explains that he has failed to uphold ceritus paribus (all things being equal) and wonders why Bernstein is so stingy with the raise, why not raise it to $10,000/hour?  Bernstein replies in his ad hoc style with "that's over the top".

Now, why is Bernstein willing to admit that raising the minimum wage to $10,000/hour would cause massive unemployment but raising it to $7/hour would have no effect except to raise the wages of the poor?  Let's put aside all the games economists play with the numbers such as not including those who stop seeking employment, or looking at immediate rather than long term effects, or not seeing the redistribution from low skill, low pay jobs to high skill jobs (which are not held by the same people).

Bernstein does not understand simple differential equations.  Take population models, our first introduction to stability, eigenvalues, and systems of first order, non-linear equations.  The rabbit and fox model is a favorite.  This will be easier if you remember what the time dependent plots look like, but you'll be able to follow either way.  Now, if the fox population increases, does the rabbit population decrease?  Answer: Just as with an increase in minimum wage, not necessarily.  Why?  Because the interaction term, or the rate at which foxes eat rabbits, in the differential equation (i.e. -a*x*y where x is the population of foxes, y is the population of rabbits, and a is positive coefficient) might be small compared to the intra-action of rabbits, the rate at which they multiply (b*y or is it b*y^2?).  An increase in the fox population may still give an unbounded population of rabbits.  It may, however, cause the rabbit population in the area to disappear if the increase in foxes is large enough or it may shift the equilibrium.

The market is very complex so I could go on for pages as to why you may not see an increase in unemployment, the easiest being inflation: inflate the money supply, raise the price of everything including labor.  But let's return to the importance of Walter's wording.  Ask the above question slightly differently, would an increase in the fox population cause the rabbit population to be smaller than it otherwise would be?  Yes, since "a" is not zero and neither is x nor y, this term necessarily pulls down the rabbit population.  In non-math terms, if one fox eats one rabbit then the rabbit population is smaller than it otherwise would be, ceritus paribus.  Is this contradictory to what I wrote above about an unbounded rabbit population?  No, because there is a time component.  Instead of rabbits increasing at the rate y=exp(5*t) it may increase as y=exp(1*t).  Either way an increase of foxes, or in our case in minimum wage (or the number of politicians who are akin to foxes), is detrimental to the rabbits.  And minimum wage is detrimental to those with small marginal revenue products who are also known as the poor.

Walter responded to Bernstein with, "I do agree with Jared on one thing, that this is a closed and shut case, you can't argue with the logic".