The Case for Freedom

Column for week of December 22, 2014

     In the nine columns so far in this series we have
considered how people endlessly seek to maximize their
satisfaction.  We noted that everyone's satisfaction largely
depends on the actions of many others.  None of us produce
much of what we use.  We also gain much satisfaction from
interactions with others.  Interaction with others is vital to the
satisfaction of everyone.

     We also saw there are two ways to govern our
interactions with each other.  We can all be free to interact or
not interact as we see fit.  Everyone can have a veto on
interactions with others.  In such an environment all
interactions are voluntary.

     Under freedom individuals seeking something from
others must ask and offer rewards to gain what they seek from
others.  Exploitation is impossible.  Everyone has the right to
say "No."  Everyone can refuse to let you have his car, or to
have lunch with you.

     If you want his car, companionship, or anything else,
you must offer something satisfying to the other person.  He
may accept money in exchange for his car.  Your
companionship may be enough to reward him for joining you
for lunch.

     The important point here is that commercial exchanges
and social exchanges are motivated in the same way.  All the
participants expect to gain satisfaction.  The things that
contribute to this satisfaction may be tangible, such as a car, or
intangible, such as companionship.  Social interactions involve
mutually beneficial exchanges as much as do commercial ones. 
Freedom in one realm is as important as in the other.  The
opposite of freedom is exploitation.

     If our interactions aren't conducted in an environment of
freedom, they must be conducted in an environment of
coercion.  Some will be forced into interactions they don't
want, or they will be forced to forgo interactions they want, or
both.

     In the world of forced and controlled interactions those
who do the forcing can gain at the expense of their victims. 
Considering that everyone seeks to maximize his satisfaction,
the individual who forces or prevents interactions will always
act in the way he believes will bring him the most satisfaction. 
The most others can hope for is that what is most satisfying to
the forcer will be most satisfying to them.  Of course, if it is
most satisfying to them, they won't have to be forced.

     Interactions based on force usually are exploitative.  If
individuals have the option to take what they want rather than
produce and trade, many, probably most, will take rather than
produce.  History is filled with slave masters, kings and other
thieves who preferred taking to producing and trading.

     People haven't changed.  At most their environment has
changed.  Given the chance to force and take, millions will. 
Even if they don't take themselves, they will eagerly take a cut
of the loot in exchange for supporting the looters.  They will
attempt to soothe their consciences by claiming they are
entitled to the loot.  Those who get the loot lose their incentive
to produce for their own use, or for trading with others.

     Only freedom and the free exchange that springs from
freedom motivate everyone to better serve others.  The more
and better chairs we produce for others, the more and better
food they will produce and exchange for the chairs.  In
freedom we don't need legions of government enforcers to
police suppliers and hold them accountable.

     Free customers police the suppliers and punish those
who fall short by buying elsewhere.  Government enforcers are
few (even if it doesn't seem that way) and aren't usually on the
job.  The consumer enforcers are on the job 24/7/365.  The
consumers are always on the scene instantly punishing
suppliers by refusing to buy.

     Under freedom, pressure from consumers pushes us all
toward better serving others.  Only those in government, and
those empowered by them, can lawfully exploit others.  And,
exploit they do.

     Next time: What should be the role of government?

aldmccallum@gmail.com
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Copyright 2014
Albert D. McCallum

The Destructiveness of Parasites

Column for week of December 15, 2014

     So far we have seen how free people seek to better
serve others.  By better serving others, we get them to better
serve us.  In free markets the wealthiest people will be those
who best serve others.  We don't need a library full of laws
and legions of bureaucrats to motivate individuals to serve each
other.

     The baker who best serves his customers will have the
most customers.  If the baker is efficient he will earn more
income than will other bakers.  Quality service plus efficiency
equal wealth.  The individuals who are well served shouldn't
complain that the baker earns profits, even lots of profits. 
Profits are his reward for serving his customers.  The quest for
those rewards motivates us all to better serve others.  The
rewards might not be profits.  They can be wages, intangibles,
or something else.

     Also, we have seen the other way to gain wealth.  That
is to use force and threats to take from others.  Those who
resort to "Do it my way, or I will hurt you" don't gain their
wealth through increasing service to others.  They are parasites
who feed on others, rather than serve others.  They consume
without producing.  Unlike the baker, their gain is someone
else's loss.

     These parasites try to hide behind slogans and high
sounding names.  "I'm a parasite.  Give me something, or I will
hurt you" doesn't win much support.   "I'm a public servant. 
Sacrifice for the common good" plays better.  It shouldn't.

     The task at hand is to dissect some of these terms that
so impress some people.  You may want to hold your nose
while we cut into these sacred cows.

     What is the "common good?"  If it is good for
everyone, Why would anyone oppose it?  Everything happens
at the individual level.  Only individuals choose, act, enjoy or
suffer.  There are no common goods or bads.  The closest we
can come to common good is something that more than one
person considers to be good.  Even if everyone finds something
to be good, the good still exists only at the individual level.

     Hang on to your wallet and cover your back anytime
someone starts preaching about sacrificing for the common
good.  It may be good for some.  You can be certain it will be
bad for others.  Also, you can be sure that the one doing the
preaching expects it will be good for him, no matter how much
it hurts others.  Minimum wages may be good for those who
collect the higher pay.  The minimum wage isn't so good for
those who are unemployed because of it and get no pay at all.

     "Sacrifice for the common good" translates as "Sacrifice
for me and my friends."  The 
term definitely loses something in the translation.  It becomes a
trick phrase minus the trick.

     Government's main functions today are 1) to take from
some and give to others, and 2) to favor some at the expense
of others.  Government doesn't gain its wealth through
voluntary exchanges that benefit others more than they cost. 
Government wealth is gained from "Pay me, or I will hurt
you."  People pay because they believe paying will be less
painful than not paying.

     As we saw at the beginning of this series, individuals
don't sacrifice their satisfaction for others.  The politicians and
bureaucrats who claim to be public servants are not exceptions. 
First and foremost they serve themselves and their supporters. 
To everyone else they are parasites.  Only free people
voluntarily serve others.  They serve because they benefit. 
People who have freedom in the marketplace produce to
exchange with others.  Then the "public servants" make them
their servants by taking what they produce.

     "Public servants" are more accurately called public
parasites.  Unless we stop parasitic "public servants" they will
suck out our wealth and productivity until we perish.  The only
good news is that any surviving parasites will then be on their
own.

     Next time: The case for freedom.

aldmccallum@gmail.com
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Copyright 2014
Albert D. McCallum

Why Do Prices Lie?

Column for week of December 8, 2014

     We have considered ways to achieve satisfaction.  We
saw how free people trading with each other endlessly seek to
better serve others to get more satisfaction from those others. 
Last time we considered the importance of rules to human
interaction.  Today we will consider more about how free
people coordinate their actions for mutual benefit.

     To achieve prosperity we must specialize and trade with
each other.  The productivity of self sufficient individuals is so
low that they are inevitably poor.  How can billions of people
coordinate their production and consumption so as to provide
everyone with an abundance of what they want?

     No one person comes close to knowing what everyone
wants.  Likewise, no one knows how to produce all of those
things, or how much to produce.  Thus, putting a great
commander in charge of production can't possibly yield good
results.  We will end up with inefficient, wasteful production of
much of the wrong stuff.  Remember the Soviet Union?

     How can people in China know how to best serve
people in the USA?  We have already seen that people in
China will want to better serve people in the USA to motivate
people in the USA to better serve people in China.

     When we think of prices, How many people think
beyond what something will cost, or how much they can sell it
for?  Prices are far more important than that.  Prices are
communications.

     The price we offer for something tells the world how
much we want that thing.  The prices we ask for something tell
the world how willing we are to supply the thing.  When we
offer higher prices we are saying "Produce more."   Lower
offers say "Produce less."

     When we offer more for flowers and less for nails, we
say "Produce more flowers and fewer nails."  To get the best
price for their efforts producers must shift from nails to
flowers.

     Free market prices tell everyone what to do to maximize
the price he will receive for his efforts.  Prices guide producers,
from workers to land owners, to use their resources to produce
the things others value the most.

     Prices guide workers to better use the skills they have
and to develop new skills.  Also, prices direct owners to devote
natural resources to their most valuable uses.

     Anything that interferes with free market pricing
disrupts production by sending false signals about supply,
demand and best uses.  Prices other than free market prices lie. 
Lying prices deceive producers into producing the wrong
things.  Shortages and surpluses result.

     One of the most destructive price lies of our time was
natural gas prices from the 1950s into the 1970s.  Government
capped natural gas prices at a very low level.  The message
sent was "Don't produce more natural gas."  The result was the
natural gas shortages of the 1960s and 1970s.  Only after the
end of price controls and lying prices did free market producers
provide an abundant supply of natural gas.  They found ways
to do this even though many "experts" said it was impossible.

     Government creates subsidy payments, special tax
breaks, quotas, minimum wage laws, and a morass of other
laws and regulations.  By doing this government has turned
most prices into liars.  These lying prices have deceived
businesses and consumers into making disastrous choices.

     Lying prices were the force that inflated the housing
bubble.  Lying interest rates set by the Federal Reserve
deceived almost everyone about the supply of wealth leading to
many ill-advised investments, including investment in housing. 
The crash of the bad investments gave us the recession.

     The human race figured out ages ago that lying is
destructive and dangerous.  How long will it take to figure out
that prices are the most destructive of liars?

     Prices are not willing liars.  They lie because
government tortures them.  We will never have real economic
recovery until government allows prices to freely speak the
truth.

     Next time: The destructiveness of parasites.

aldmccallum@gmail.com
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Copyright 2014
Albert D. McCallum

How Do Free People Coordinate Their Actions?

Column for week of December 1, 2014

     We have considered the vital importance of the
contributions others make to our satisfaction.  We can't benefit
from the actions of others without interacting with them.  To
smoothly interact with others their actions must to some extent
be predictable, and coordinated with ours.  Of course, our
actions must also be predictable by them.  Imagine driving if
you had no way of predicting what other drivers would do.

     Commonly observed rules are vital to our interactions
with others.  Sometimes it isn't vital which choice others will
make.  It is vital that we can predict that choice.  It isn't
important whether the approaching drivers hold to the left or
the right.  What is important is that we know which choice
they will make.

     Some choices are so destructive to peace and prosperity
that we need to eliminate, or at least minimize, those choices. 
Murder, robbery, fraud and other aggressive actions are
destructive to peace and prosperity.  The lists of destructive
choices and choices we need to be able to predict are indeed
long ones.

     From the time people began interacting experience has
defined the choices we must be able to predict and the ones we
must try to eliminate.  It would have been impossible for the
first humans to have fashioned a list of all those choices.

     Fortunately we have the benefit of experiences down
through history.  Essentially every society has arrived at lists of
dos and don'ts that are quite similar.  These rules were not
enacted by kings or legislatures.  These vital rules were
discovered independently by many societies.   Legislation
followed the rules rather than creating them.  They became
rules to live by, not because they were enacted, rather because
people lived by them and found them beneficial.

     Whether a rule is a good one or not depends on whether
it aids the general pursuit of satisfaction, not on how many
politicians vote for it.  The natural, beneficial rules gain
widespread acceptance simply because people recognize the
benefits that flow from observing the rules.  The most that
government and enacted laws can do is try to enforce the
generally accepted rules against the few violators.

     Making up rules and trying to enforce them against a
population that contains a substantial number of dissenters
doesn't work.  It only creates strife and controversy, even if the
rule might be a beneficial one if generally accepted.  The world
might be a better, more satisfying place if people used far less
alcohol and drugs.  Trying to enforce no alcohol, no drug rules
against substantial dissent only creates strife and disaster.  The
rules of society must be discovered and accepted if they are to
work.

     Rules against destructive practices, such as "honor
killings" and racially motivated attacks won't work unless a
substantial majority of people accept the rules.   Education and
persuasion, not legislation, are the effective ways to change
behavior.  The peer pressure that goes with generally accepted
rules is far more powerful than cops and courts.

     The most cops and courts can do is round up a few
stragglers that refuse to abide by the rules already generally
accepted and enforced by peer pressure.  If most people treat
drunk drivers as unclean misfits and shun them, drunk driving
will cease to be a major problem.  So long as society shows
tolerance for drunk drivers, drunks will continue to drive.

      Within the framework of accepted rules, free individuals
agree to interact as they may choose.  So long as the rules
forbid aggression, no one is free to forcibly interfere with any
peaceful conduct.

     The more we look to government for new rules and the
imposition of old ones, the less effective all rules will become. 
Such an avalanche of laws will destroy respect for all laws,
including the natural ones that have evolved and passed the test
of time.

     Next time: Why do prices lie?

aldmccallum@gmail.com
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Copyright 2014
Albert D. McCallum

What Happens When People Are Free to Trade?

Column for week of November 17, 2014

     We have considered satisfaction, the ultimate goal that
we all seek.  Part of the consideration was of how we influence
others to do the things that satisfy us.  We will now give
further consideration to the trading of satisfactions. 
Exchanging lesser satisfactions for greater ones is the sole
objective of free trade.

     There are two kinds of exchanges, forced ones and
voluntary ones.  A trade isn't voluntary unless all parties to the
trade voluntary participate without coercion.  A forced trade
isn't really a trade.  It is at least in part a forced taking, also
known as theft.

     When a bully forces another child to "trade" sandwiches
the bully is forcibly taking something.  Perhaps the other child
would have freely traded half of his sandwich for the bully's
sandwich.  In such case the bully traded his sandwich for half
of the other sandwich and forcibly took the other half.  Half a
theft is still theft.  The victim is forced to give up satisfaction
rather than being compensated by getting a greater satisfaction
than he lost.

     Instead of the bully taking the sandwich, he may
prevent its owner from trading for something, perhaps a cookie,
he believes will increase his satisfaction.  The victim has still
been forcibly deprived of satisfaction.

     In fully free trade everyone is free to trade for anything
with anyone.  Of course, that someone else always has veto
power over the trade.  He doesn't have to settle for decreased
satisfaction.

     How important is trade?  What do you have or consume
that you produced for yourself?  Without trade or gifts, or theft
you wouldn't have anything you didn't produce.  What would
your life be like?  Could you even survive?

     Trade is one of the cornerstones of our prosperity. 
Without trade and the specialization it makes possible, most
people would have very little.  Most of us would live on the
edge of survival, or not survive.

     All free trade is motivated by the desire to obtain
something that will yield greater satisfaction.  How can both
parties to a trade gain satisfaction?  It is because both don't
expect the same satisfaction from the things traded.

     Alice has apples.  Betty has potatoes.  Betty offers a
potato for an apple.  Alice says no.  She values the satisfaction
from the apple more than that from the potato.  Betty raises her
offer until it reaches 10 potatoes.  Alice accepts.  She values 10
potatoes more than one apple.  Betty places the greater value
on the apple.  Both gain satisfaction.

     This example also illustrates the point that the more
value we offer someone, the more value they will offer back. 
In other words, the better we serve others, the better they will
serve us.  If we want more from others, we must produce more
for them.  No one is ripping anyone off.

     This reality motivates free people to endlessly seek to
serve others better.  We don't serve others because we aren't
selfish.  We serve them because we are selfish.  We want more
and serve others better to get it.

     If we become satisfied with what we are getting, we no
longer have any reason to increase our service to others.  Why
train for a different job that better serves others unless we are
trying to get more satisfaction for ourselves?

     I'm sure that when people train for and seek higher
paying jobs they don't spend a lot of time thinking about
serving others better.  They most likely think about what they
will get.  If the higher paying job didn't serve others better, it
wouldn't be higher paying, unless it is a government job.

     The gains possible through free trade push everyone to
increased productivity and increased service to others.  It is the
only way to organize society without creating winners and
losers.

     Next time:  The alternative to free trade.

aldmccallum@gmail.com
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Copyright 2014
Albert D. McCallum

The Alternative to Free Trade

Column for week of November 24, 2014

     We have considered what people want and some ways
of satisfying those wants.  We saw that everyone's ultimate
goal is to maximize their satisfaction.  When it comes to
satisfaction, we are all totally greedy.  We always make the
choice we believe will bring the most satisfaction. 

     Last time we considered how free people can pursue
satisfaction.  Now we will consider the alternative.

     The only alternative to freedom to choose is coercion
with force and threats.  Free people don't have to march to
anyone else's drum.  They are free to march to the beat of their
own drum, or any other drum they choose.

     The individual isn't free if he faces the threat of  "Do it
my way, or I will hurt you."  The threat may come from
bandits or government.   Being free means no more, and no
less, than being free from the threat of aggression by all others. 
To be truly free everyone must be free from the threats of
others.

     It may seem paradoxical that true freedom requires that
no one be free to commit aggression.  Aggression is initiating
or threatening the use of force, deceit or stealth against
peaceful people.  Free people are free to do anything they
choose, so long as they don't initiate force, deceit or stealth
against peaceful people.  The only justifications for the use of
force are prevention of aggression and the forcing of restitution
for harm caused by aggression.

     Free people aren't answerable to any commander.  Each
is his own commander.  His only obligation is to respect the
equal freedom of all others.  All interactions among individuals
are voluntary.  Considering that we all need the aid of others in
pursuit of our satisfaction, freedom leads to voluntary
interaction and cooperation.  Each party to an interaction
expects to increase his satisfaction through the interaction. 
There are no masters or slaves, and no losers.

     The only alternatives to freedom are coercion and
deceit.  Some individuals use force and threats of force to
coerce others to do the will of the dominator.  This creates a
world of "Do it my way, or I will hurt you."

     In our world we live with a mixture of free choice and
"Do it my way, or I will hurt you."  In some societies the
threats are dominant.  In others people enjoy substantial
amounts of freedom to choose.

     We saw that in free markets individuals gain the
cooperation of others by rewarding them.  The rewards may be
substantial sums of money, or as simple as a smile or a
greeting.  In freedom we gain the aid of others by aiding them. 
There are no losers.  No one is forced to sacrifice his
satisfaction to satisfy others.

     In the world of coercion some dominate others.  The
dominators can gain satisfaction without providing any
satisfaction in return.  Those who are exploited don't appreciate
this.  They are likely to seek ways to resist.  The dominators
are parasites.  They live off others while having no incentive to
produce anything for anyone.

     The world of domination is a world of strife and a low
level of productivity.  Think North Korea or Cuba.  The world
of domination by "Do it my way, or I will hurt you" is
inevitably a world of strife, poverty, and misery for most.

     In a world of freedom and free markets we won't
achieve utopia.  We will endlessly move toward more
satisfaction.  In the world of "Do it my way, or I will hurt you"
we will endlessly spiral down into strife, poverty and misery.

     I am not interested in the possibility that we might share
the strife, poverty and misery equally.  I prefer peace,
prosperity and satisfaction, even if some earn bigger scoops
than do others.

     Next time:  How can free individuals coordinate their
actions with each other?

aldmccallum@gmail.com
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Copyright 2014
Albert D. McCallum