From what I can tell, many socialists feel that the federal reserve is part of the capitalist system. It may have been set up by capitalists, but that does not make it a capitalist institution. Besides, what is a central bank but a mechanism for controlling markets, that is markets in money. Now (this may not be entirely new and maybe someone already clearly stated this) I believe that the financial crisis in 2008 really stemmed from the failure of socialist economic calculation. Part of my hypothesis is that it was not greed at all. It was ignorance, in a way. There was so much credit and money around that no one knew what to do with it, and probably there was nothing to do with it. In other words, the markets were so distorted and signals from the market could not even be read that the central bank, federal reserve, completely and utterly failed. It failed for reasons that apparently Mises pointed out decades ago. I don't know the really technical aspects of the calculation debate, but it seems to me that the crux of it is that a centrally planned economy will, eventually, fail no matter what because it cannot take into account all of the variables. I think that this probably represents a good historical experiment for economics. Maybe some of that history has already been written I'm not sure. What do people think and are there any books concerning this topic specifically that anyone has read?
If your conjecture is correct, why were some people able to predict what would happen?
My humble blog
It's easy to refute an argument if you first misrepresent it. William Keizer
"If your conjecture is correct, why were some people able to predict what would happen?"
Because they knew that the market was being distorted. Of course, while they had a general idea of where the distortions were, they did not know by how much all the prices were distorted, so this has an effect even if everyone has the idea of what is going on.
Schools are labour camps.
If you control a central bank, you can influence market bubbles and crashes. If you can influence market bubbles and crashes, you can bet on them with far better than even odds. If you can bet on market bubbles and crashes with far better than even odds, you can make gazillions of dollars. The potential to make gazillions of dollars would never be passed up by a rational individual. Hence, those who control central banks necessarily use them to cause market bubbles and crashes for the express purpose of profiting from them.
Or, you can bury your head in the sand and pretend that the Federal Reserve is operated by angels descended from heaven.
Clayton -
Phaedros:From what I can tell, many socialists feel that the federal reserve is part of the capitalist system. It may have been set up by capitalists, but that does not make it a capitalist institution.
It's centrally planned money supply. That's not a free market institution. A crony capitalist institution maybe.
Clayton:If you control a central bank, you can influence market bubbles and crashes. If you can influence market bubbles and crashes, you can bet on them with far better than even odds. If you can bet on market bubbles and crashes with far better than even odds, you can make gazillions of dollars. The potential to make gazillions of dollars would never be passed up by a rational individual. Hence, those who control central banks necessarily use them to cause market bubbles and crashes for the express purpose of profiting from them. Or, you can bury your head in the sand and pretend that the Federal Reserve is operated by angels descended from heaven. Clayton -
Of course they do. On average financial traders make a loss. The only way to profit off pushing around papers is to create bubbles.
I just have something to say about your use of the term 'socialism'.
Now as an ex-socialist myself I always thought it was laughable when people on the right used to say things like fascism=socialism=liberalism, or "Its socialism! We're all doomed!" (*uses big scary words like communism to describe things like socialised medicine, etc.* - e.g. good old Glenn Beck)
Now as someone who is not a libertarian but a classical liberal who believes in small government, low taxes but still upholds a degree of state regulation (where there is optimum allocation of resources - the returns are maximised) and possibly a degree of welfare but has plenty of libertarian leanings I completely see where you're coming from.
Either (a) you want to intervene in the economy and people's private lifes (in which case you are an interventionist) or (b) you do not (that's me! Kind of...).
Socialists have this idealistic dream goal of worker run councils, co-operatives, democracy in the work place, etc. but at the end of the day, they desire interventionism (with the exception of individualist 'socialists' like Benjamin Tucker and pacifists like Tolstoy who I have utter respect for) to remove capital from skilled market entities (investors, entrepeneurs and the like) into the hands of the 'little fellow' - it requires a state of sorts (I count syndicalism as a form of corporatism - syndicates often end up merging with the state and becoming corporations just like ordinary unions). Eventually, because democracy in its purest form is so instable, managers and elected representatives emerge and slowly become authoritarian dictators, people become fed up with democracy, etc. Socialism is state ownership of the means of production, to be rather blunt and indeed, that is what most contemporary socialists advocate, state ownership.
So, all in all, I see where you are coming from, lumping all the statist/interventionist ideologies together but I think that to escape ridicule in the world of academia, it is necessary to distinguish between the ideologies; the federal reserve's excessive powers are caused by Keynesianism, not socialism (although both are most certainly interventionist ideologies and have their overlaps, I will not deny you this).
Sorry to cause a thread drift :P.
EvilSocialistFellow:I just have something to say about your use of the term 'socialism'. Now as an ex-socialist myself I always thought it was laughable when people on the right used to say things like fascism=socialism=liberalism, or "Its socialism! We're all doomed!" (*uses big scary words like communism to describe things like socialised medicine, etc.* - e.g. good old Glenn Beck) Now as someone who is not a libertarian but a classical liberal who believes in small government, low taxes but still upholds a degree of state regulation (where there is optimum allocation of resources - the returns are maximised) and possibly a degree of welfare but has plenty of libertarian leanings I completely see where you're coming from. Either (a) you want to intervene in the economy and people's private lifes (in which case you are an interventionist) or (b) you do not (that's me! Kind of...). Socialists have this idealistic dream goal of worker run councils, co-operatives, democracy in the work place, etc. but at the end of the day, they desire interventionism
Socialists have this idealistic dream goal of worker run councils, co-operatives, democracy in the work place, etc. but at the end of the day, they desire interventionism
As a socialist, what term would you have accepted for "those who desire authoritarian central planning"? Just looking for one that will work since socialists will consider the term socialism laughable.
"Now as an ex-socialist myself I always thought it was laughable when people on the right used to say things like fascism=socialism=liberalism, or "Its socialism! We're all doomed!" (*uses big scary words like communism to describe things like socialised medicine, etc.* - e.g. good old Glenn Beck)"
Also. the world is easier to understand when simplified into just two opposing ideas. No room for cognitive dissonance that way. God forbid if Glenn Beck ever learns to count to three. His head might explode.
EmperorNero:As a socialist, what term would you have accepted for "those who desire authoritarian central planning"? Just looking for one that will work since socialists will consider the term socialism laughable.
Well firstly If I wanted to lump together all neoconservative types, all socialists, progressives, etc. I would refer to them as 'interventionists'
I can't think of a term for 'authoritarian central planning' (though if you think about it that presupposes interventionism) except maybe, I dunno 'planner'? 'Central planner'? Authoritarian might come across as a bit too aggressive/derogatory... (unless of course that is your effect desired).
The thing is *some* communist anarchists (though they are a minority of leftists, it must be stated) don't think of their ideology as being central planning, since the commune is more like a miniature state than a centralised state, they think of it as 'decentralised planning', possibly 'decentralised democratic planning'. I don't know if such a thing actually exists/whether the term is etymologically correct/whether it is not an oxymoron though...
Though syndicalist style trade unionism (what *most* - but not all - communist anarchists advocate) is in fact a strategy and not and ideology, its premise is rooted in what I would describe as corporatism (so not exactly socialism). Still an interventionist ideology and, as we all know, interventionism boils down to statism in essence. It is, however, a far weaker and less dangerous strategy than the Marxist belief in seizing the state since it is easier to undermine syndicates than a monopoly on coercion. Franco Francisco obliterated the Spainish anarchists within 3 years and put 3 million of them (I believe) to death and exile. I don't support Franco (who turned to syndicalism and then, later implemented neoliberalism) but it was a necessary evil at the time.
They are still interventionists though, and they cannot escape this fact. Either they want to initiate force and coercion to create their system or they do not. And that is the difference between *us* (though I am personally a minarchist, technically speaking) and *them*. Other than that, they only wish to initiate force and coercion for different purposes; the fascist wishes to use it for the sake of nationalism, culture, pride and love of the sake whereas the liberal wishes to use it to promote equality and to end 'discrimination' by forcing employers to 'positively discriminate' (by employing more ethnic groups and women), pay women more, etc. or to ban pubs from allowing smokers. I found myself having to eventually admit, whilst a communist anarchist, that the system would require violent intervention and in the end the cognitive dissonance was too much; I simply had to retreat from the ideology.
Two important things about the Central Banks' failures:
1. "but it seems to me that the crux of it is that a centrally planned economy will, eventually, fail no matter what because it cannot take into account all of the variables" - This wasn't the Mises's central point. It was Hayek's and it wasn't correct. The improvements in the technology today proves this point wrong. The Mises's point was that you can not know the prize at all where you don't have a free-market institutions and private property. The prizes derive from the subjective ideas of the individuals and the scarcity of some particular object/service. They are something like "objectivisation of the subjective thoughts". Without free choice and markets it is not possible to know the real, market prizes and you can't calculate economically.
2. The Central Bank is not a capitalist invention at all. It is "capitalist" that put this idea in practise. If you read Marx's Communist Manifesto you will see that one of the proposals he gave for "transfer" of capitalist to socialist society is exactly the creation of Central Bank (institution that will control the credit/money in one society)!
Just say "you can't. That is a stupidly simple analysis." Stalin, Hitler, Ceaser, and George Washington cannot all be lumped into one simple category, especially not "socialist."
Were you a socialst for like 2 weeks before you gave it up? Are you relying fully on revleft and/or Mises.org for you definition of socialism?
Where is the commune's monopoly on violence? Im not even a an-commy and I can see this analysis falls short of "mini statism."
Though syndicalist style trade unionism (what *most* - but not all - communist anarchists advocate) is in fact a strategy and not and ideology, its premise is rooted in what I would describe as corporatism (so not exactly socialism). Still an interventionist ideology and, as we all know, interventionism boils down to statism in essence.
How is a worker owned franchise "interventionism." Syndacalists still have to trade on the open market. The franchise is merely owned by the workers through the union, rather than by the investors through the board. It seems to me you understood nothing about what you forsook.
Franco Francisco obliterated the Spainish anarchists within 3 years and put 3 million of them (I believe) to death and exile. I don't support Franco (who turned to syndicalism and then, later implemented neoliberalism) but it was a necessary evil at the time.
"Stalin obliterated the capitalists, anarchists, and intellectuals. I don't support Stalin, but it was a necessary evil at the time."
Tyranny is good if it's against the poeple I don't like? You're gross.
They are still interventionists though, and they cannot escape this fact. Either they want to initiate force and coercion to create their system or they do not
This analsyis is just as true for capitalism. You wil lhave to force/coerce me to respect your property just as the communist has to coerce you to respect communal property. You cannot escape this fact.
In States a fresh law is looked upon as a remedy for evil. Instead of themselves altering what is bad, people begin by demanding a law to alter it. ... In short, a law everywhere and for everything!
~Peter Kropotkin
This wasn't the Mises's central point. It was Hayek's and it wasn't correct. The improvements in the technology today proves this point wrong.
I disagree. Though Mises's is the stronger of the two arguments, Hayek held that a central planner could not access circumstantial/local data at the disposal of individuals in their decisionmaking. I'd go further and say they cannot access their assessment of opportunity costs/subjective wants. This is why they often resort to "market" socialism, to avoid some of these problems at the level of consumer demand. It still fails with respect to ownership of capital goods and this is where Mises's contribution comes in.
If you fail to delineate between offensive and defensive use of "coercion", sure. A lot of commies/socialists, even of the "anarcho" variety, seem to want to coerce people into accepting (by which I mean to participate in) their system, even if it be through the state. I don't know of anarcho-capitalists/voluntaryists who'd support such a stupid idea.
Freedom of markets is positively correlated with the degree of evolution in any society...
If you fail to delineate between offensive and defensive use of "coercion", sure.
Not in any way. You are intiating aggressive force by partitioning off a piece of land and claiming it as yours and only yours. You're a criminal in my eyes. I will be confiscating your property and returning it to it's legitimate controllers in defense of the community.
A lot of commies/socialists, even of the "anarcho" variety, seem to want to coerce people into accepting (by which I mean to participate in) their system, even if it be through the state.
Evidence?
I don't know of anarcho-capitalists/voluntaryists who'd support such a stupid idea.
Perhaps we should revisit the thread on Pinochet? Or better yet 2 more recent threads; the one's dealing with libertarians accepting welfare and working for state institutions. Because there are plenty of ancaps in all 3 of those threads saying they are perfectly fine using the state to destroy the state.
Methodological individualism much? Who are these "most socialists" and "most ancaps?"
And in your opinion was franco using 'offensive' or 'defensive' coercion?