[ExI] Belief in Market Efficiency

[painlord2k at libero.it]

Il 02/02/2009 23.20, Fred C. Moulton ha scritto:
> On Mon, 2009-02-02 at 15:13 +0100, painlord2k at libero.it wrote:
>> Do you don't like the label "communist" or "socialist"?
>> Mises used another label for what you support and is "statism".
>
> I know that Mises used the term but is it really useful in this context?

I think so, because it help group together groups that may be 
antagonists each others or with conflicting policy in other fields, but 
have the common belief that the state can do better than the private ones.
They believe in bureaucracy more than in markets.
They can talk against the current governments, bur they simple want 
substitute the current one with their. And, usually, in the process, 
they want enlarge the power of the government itself, making the same 
problems bigger.

>> Statists will come in many fashions like communists, socialists,
>> social-democrats, fascists, islamists, and so on.

> The reason I ask is that a term which lumps so many disparate
> classifications together may not provide the distinctions we want.

If you look at cars, motorbikes, ships, trains, power stations (some) 
you could say that they are disparate and lump together them not provide 
the useful distinctions we want. But they have in common that they use 
hydrocarbons.
In the same way, if we are interested in looking what enhance the 
personal freedom of the people, we look at systems making this distinction.

All the groups notes believe that a supreme body (elected, co-opted, 
etc.) must lead the masses and rule how they must live. And they believe 
that the not conforming ones under their power must be forced to behave 
as ruled.

What change is only the set of rules and the level of violence that they 
are willing to use.
What don't change is that they use more violence against the weaker and 
less against the stronger, and all of these system are open to take-over 
by people with little scruples.

Look at Gorbaciov, he is surely a good pal, but when he was the 
Secretary of the Party he had not problem to force people in long 
marches in the middle of the (Russian) night because they drank.

http://mises.org/story/3105

> Although it may be a good rhetorical label to pound someone with...
> however I thought we were going to ease up on the pounding on people.

There is no intention of pounding, only the intention to point to the 
facts. The truth could be harsh, but it is not "pounding" someone 
telling the truth.

If I point to a fact, for example that all people in charge of 
concentration and killing camps in Nazi Germany were lacking human 
empaty, is this pounding or a fact?

>> What don't change is
>> that they can not compute the value of the goods, services and life of
>> people.
> The "economic calculation problem" is worth considering.

It is not only worth considering, it is the fundamental problem of any 
and all societies.
It is how you put bread and meat on the table, how you build homes and 
finance healthcare, how you have scientific and technological research.

It will not solve all problems, for sure; but without all the problem 
become unsolvable.

>> They destroy the social cooperation and the fabric of the society.

> I think the word destroy is a bit strong.

Yes, usually the social cooperation resurface after in its worst forms.
Tribalism and banditry.

> I think we all can agree that
> there is a big difference between a generally social-democratic country
> and an authoritarian or totalitarian country.

The difference is in quantity not in quality.
A social-democratic country simply will try to don't use the violence 
directly, but the damage caused will not be small compared with the 
means used.

Look at Sweden, it went from an income of 130% in respect of the mean 
(100%) income of the more developed countries in 1950 to the current 
80%. They lost 1/3 of their wealth in the process of enacting their 
welfare state and it is dubious they will be able to keep their current 
status.
This is happening in all Europe (and in the USA, Canada) in a way or in 
another.

> You might argue that some
> aspects are weakened or that some feed back loops are distorted but I
> think "destroy" is perhaps a bit overboard.

When you damage the economy you are killing people in many subtle ways 
and making other live worse.
When you force the costs of a hip replacement 3 times higher, you are 
killing people whatever is your real intention. And you can drive the 
price increase changing a law or two not apparently related with 
healthcare or surgery.

If the life expectancy grow 2% or 2,5% a year could not make big 
differences in a years or two, but in the long term will do very big 
differences.

It is like killing someone with 1000000 stroke of a tiny razor and not 
with a sword. It will need more time, but the effect is the same.

E.G. In Italy the public administrations are always late in their 
payments to private business. Now a bit less, because they are forced to 
pay interests on them (Euribor + 7%) by the European Court of Justice. 
Do you think that businessmen will not add to the prices the cost to 
wait for the payment?
So, all these inefficiencies are paid by the taxpayers in heavier taxes 
and lower services. Then, instead to have a treatment done in less than 
a week you have the same treatment done after a waiting of one year.



Mirco


Ludwig von Mises: "It is justifiable if ethics and religion tell people 
that they ought to make better use of the well-being that capitalism 
brings them. . . . But it is irresponsible to condemn one social system 
and to recommend its replacement by another system without having fully 
investigated the economic consequences of each." - Theory and History