Friday, December 16, 2016

The Left's Catalog of Errors

Let us set forth, as a public service, the catalog of errors that our lefty friends have compiled over the years. But let us not just dismiss with a snarl but understand the ground of their errors and give their follies the benefit of the doubt.

Wage Labor is Alienation. No it isn't. Wage labor is a boon to the worker because he assigns a lot of the risk of producing and selling away to his employer. Source of error: Marx believed in the classical economists theory of value, with competing "use value" and "exchange value." He proposed that the natural task of labor was producing for "use" rather than producing for sale. But the marginal revolution of 1870 solved the value problem by realizing that all prices are determined "at the margin." Benefit of the doubt: Wage labor was dehumanizing, especially at the start of the industrial revolution before inventors had figured out how to automate all dehumanizing work.

Capitalism will "Immiserate" the Workers. No it won't. The capitalism of the last two hundred years has been a Great Enrichment with successive innovations building prosperity from $1-3 per capita per day to $100 per capita per day in real dollars. There has been nothing like it, ever. Source of error: Marx understood that market competition tends to squeeze profit out of any undertaking as new market entrants compete for the consumer's business. So, if nothing changes, competition is likely to squeeze all costs, human and material, to the bone. But Marx forgot one thing. It is true that in each individual industry increasing competition squeezes profit away from the producers and "immiserates" them. But actual history is that every decade or so, a new revolution of innovation produces new opportunities for profit, and most of the immiserated workers get jobs in the new industry. Benefit of the doubt: At the time that Marx was writing nobody could have foreseen the oil revolution, the internal combustion engine, the electrical revolution, the physics revolution, the electronics revolution, the computer revolution, the internet revolution.

Socialism will end the exploitation of man by man. No, it didn't. Socialism has been a disaster wherever it has been tried, whether as a simple rural commune or as an administrative socialist state. Source of the error: In its rural commune version socialism fails because "to each according to his needs" discourages people from working. That is why all rural communes like New Harmony, Indiana, fail. In socialism's administrative version the political bosses decide what work is to be done. But political bosses don't know what work needs to be done. In fact, we now know, socialism can't work because it cannot compute prices, and administrative bureaucrats cannot outperform the price signalling of the market, and regulation cannot work because it ends up captured by the regulated. In reality, of course, capitalism is the closest we are ever going to get to socialism, because capitalism, through the price system, encourages everyone to altruistically find work that is useful to other people; it demands that they do socially useful things with their lives. Benefit of the doubt: The world is a cruel place, and mankind has ever dreamed of a perfect land of peace and justice.

Government can Deliver Social Services. No it can't. OK, it can for a while. But over time government fails to adjust its service delivery program to new conditions and needs. Source of the error: Government is an armed minority that occupies territory and taxes the inhabitants so it can reward its supporters. Thus all new government programs and "reforms" end up merely rewarding the government supporters and only incidentally providing social services. It becomes almost impossible to reform an existing government program because the clients of the program object vociferously if anyone proposes to reduce their benefits. This is why education is failing to teach, Social Security will go broke, Health care is brutally expensive, government welfare doesn't raise the poor out of poverty. All this reduces to the truism that it is almost impossible for a government to reduce spending. Instead, government resorts to subterfuges, including hyperinflation, as in Germany and Austria after World War I, Zimbabwe in the 2000s, Venezuela in the 2010s. The root of all these disasters is a government that dared not reduce its spending to balance against its reduced revenue. Benefit of the doubt: Humans ask for things from their leaders that they shouldn't ask for, and politicians try to deliver. Until they can't.

It's all the Fault of Racists, Sexist, Homophobes. Yeah. The problem with all oppression theories under capitalism is the question: why don't the evil capitalists hire the oppressed and marginalized and underpaid and exploit the hell out of their marginalized status? Why don't businesses flood into the inner city and hire blacks? Why don't they prefer the underpaid women that apparently work for 80 cents on the dollar? Or, under the current diversity regime where the capitalist all advertise their eagerness to diversity their workforces, why aren't the traditionally marginalized zooming up to the top of the charts? In fact, as the Jim Crow era in the South showed, you need to pass and enforce racist laws in order to force business to hew the racist line. Source of the error: People don't appreciate the depth of the social revolution we call the industrial revolution. It requires people to abandon their pre-industrial culture of the kindred, the tribe, and the village, where you only trust your kin, your race, or your fellow villagers. The modern world demands that everyone enter into the trust culture of capitalism where you trust and work with anyone that can be trusted, and submit yourself to the judgement of the market rather than the judgement of your in-group. This is hard, very hard, and it creates a demand for political activists that conjure up scapegoats. See RenĂ© Girard. In modern democracy we scapegoat the "in" party and hope to end our troubles by throwing the rascals out and voting for "change." Benefit of the doubt: It is very easy to see the mote in another's eye, but very hard to see the beam in one's own eye.

To be continued.

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