Sunday, January 31, 2016

Professor Fekete at The Daily Bell

Professor Fekete: The Rothbardian and Misesian prognostications are rooted in the Quantity Theory of Money (QTM), according to which, if it were correct, we would have inflation instead of deflation following the miraculous proliferation of money, credit and debt.

BM: Two thoughts.  First, there is inflation – using the professor’s own definition (and I will come to this shortly).  Second, the professor seems to be describing only one side of the QTM equation and then attributing this definition to the Austrians associated with Mises and Rothbard. 

Hans Hoppe defines the quantity theory of money: “whenever the quantity of money is increased while the demand for money to be held in cash reserve on hand is unchanged, the purchasing power of money will fall.”

Hoppe has read and studied far more Mises and Rothbard than I have, so I will take his word for this.  In any case, this more complete definition by Hoppe seems reasonable.

Professor Fekete: I recognize only one kind of deflation, namely the deflation of assets.

BM: It is interesting; the professor defines “deflation” in the price of assets.  Would it not follow that he would define “inflation” the same way, in the price of assets?  Yet he does not recognize today’s asset price inflation as inflation – see his quote at the top of my comment.

Using Fekete’s own definitions, Mises and Rothbard are correct, yet the professor chides them for this.

But why is there an expectation of a deflation of assets?  It can only be due to an artificially induced and maintained inflation in assets.  And why would this be?  Might it have something to do with the quantity theory of money and where / how that quantity was deployed?

Professor Fekete: A gold standard cum real bills is the right medicine to the moribund world economy.

BM: Unless it is advocacy for the free market, I get nervous when someone proclaims “the right medicine” for economic ills (aren’t we operating under the “professorial standard” today?) although I find no reason to disagree with “a gold standard cum real bills” as a possibility in a market of freely developed and accepted money and credit instruments.

Saturday, January 30, 2016

The Futility of Moderation

Will Wilkinson has written a piece on the virtue of moderation in the pursuit of liberty.  In it, he points to the futility of libertarians who…well, let him tell it in his own words:

Winning and keeping the allies needed to achieve practical political success has always been hard for libertarians. One reason it’s so hard is that the most popular brand of libertarian thought is more a theory of the illegitimacy of the state than a theory of government, and leaves no dignified place for political activity. Insofar as the Locke-inspired libertarianism of Ayn Rand, Murry Rothbard or Robert Nozick is a theory of government, it is a theory of minimal, constitutionally constrained government that looks nothing like any regime that has ever existed.

…a lot of libertarians don’t think this sort of minimal, constitutionally constrained government can possibly stay minimal, and that it would be better if there’s no state at all. That leaves no space for politics, as it is commonly understood.

My point here isn’t to criticize this picture, though there’s a lot wrong with it. My aim is simply to point out that there’s little room in the picture for the roiling adversarial mess of multiparty democratic politics. Accordingly, libertarians tend to see democratic politics as an ungodly festival of thuggery and mutual predation. Active political participation is seen as wicked, futile, or both. It’s hard to think of a political philosophy less likely to inspire its adherents to throw themselves into the hard work of real politics, or to see any virtue in it. A corollary of the standard libertarian stance is that almost every faction and interest group active in democratic politics is pursuing something it probably shouldn’t have through means nobody should be allowed to use. Libertarians tend to be pretty vocal about their disdain for the process, and everyone invested it in, which can make it hard for them to warm up to potential political allies, and vice versa, in those cases when they manage to overcome their contempt for politics and seek to get something done democratically.

I give Mr. Wilkinson much credit – he pretty much nails the view of the many libertarians who find no benefit in working within the system.  There are many specific points I might make in reply to the various statements (both these cited above and others in his piece), however I will focus on only one aspect of his views.

Wilkinson points to the futility of this “most popular” (at least he got this right) libertarian view.  He asks: how do you expect to move toward liberty if you aren’t willing to work with the political tools available?


Before getting to the point, first some introductions are in order.  Who is Will Wilkinson?

Will Wilkinson (born 1973) is an American writer who currently serves as Vice President of Policy at the Niskanen Center. Until August 2010, he was a research fellow at the Cato Institute where he worked on a variety of issues including Social Security privatization and, most notably, the policy implications of happiness research….Previously, he was Academic Coordinator of the Social Change Project and the Global Prosperity Initiative at The Mercatus Center at George Mason University, and, before that, he ran the Social Change Workshop for Graduate Students for The Institute for Humane Studies. His political philosophy is described by The American Conservative magazine as "Rawlsekian"; that is, a mixture of John Rawls's principles and Friedrich von Hayek's methods.  Wilkinson formerly described his political views as libertarian, but he now rejects that label.

Here are some not-standardly-libertarian things I believe: Non-coercion fails to capture all, maybe even most, of what it means to be free. Taxation is often necessary and legitimate. The modern nation-state has been, on the whole, good for humanity. (See Steven Pinker’s new book.) Democracy is about as good as it gets. The institutions of modern capitalism are contingent arrangements that cannot be justified by an appeal to the value of liberty construed as non-interference. The specification of the legal rights that structure real-world markets have profound distributive consequences, and those are far from irrelevant to the justification of those rights. I could go on.

So many things I might say, but again I do not want to divert from the one main point I wish to make.

What is the Niskanen Center?

The Niskanen Center is a Washington, D.C.-based think tank that advocates for environmentalism, immigration reform, civil liberties, and a national defense policy based on libertarian principles. The center is named after the late William A. Niskanen, a former economic adviser to president Ronald Reagan.

Funding for the center includes donors who seek to counter conservative hostility to anti-global warming measures. North Carolina businessman Jay Faison, a Republican donor, is a funder to the Niskanen Center and views it, along with the R Street Institute, as a route for climate action to gain a foothold within the GOP. Some supporters of the Niskanen Center are more traditionally aligned with liberal causes. They include the Open Philanthropies Project, which supports the Center's work to expand legal immigration, as well as the Lawrence Linden Trust for Conservation, which provided the Niskanen Center with a grant "to develop and analyze a potential economy-wide carbon tax", and the Nature Conservancy.

From the Niskanen Center website:

Established in 2014, the Niskanen Center is a libertarian 501(c)(3) think tank that works to change public policy through direct engagement in the policymaking process: developing and promoting proposals to legislative and executive branch policymakers, building coalitions to facilitate joint action, and marshaling the most convincing arguments in support of our agenda.  The Center’s main audience is the Washington insiders – policy-oriented legislators, presidential appointees, career civil servants in planning, evaluation and budget offices, congressional committee staff, engaged academics, and interest group analysts – who together decide the pace and direction of policy change.

The Center is named after William (Bill) Niskanen.  Bill was a long-time friend whom we knew as chairman of the Cato Institute.  Before his time at Cato, Bill was a defense policy analyst at RAND, director of program analysis at the Institute for Defense Analyses, assistant director of the Office of Management and Budget, professor of economics at the University of California at Berkeley, chief economist at the Ford Motor Company, professor of economics at UCLA, and a member (and later, acting chairman) of the Council of Economic Advisers under President Ronald Reagan.

The leadership of the center is made up of several individuals formerly associated with the Cato Institute – another libertarian-type think tank based in Washington; the Cato Institute is also dedicated toward policy recommendations.  The Institute was founded in 1974.

The Point

Now that all the background is out of the way, what is my point?  Wilkinson offers that the way to move toward liberty is to engage in the political process and compromise; neither fits well with dogmatic, principled libertarians.

So I ask, where are the major successes since 1974?  How have the last forty-two years (since the birth of Cato) of working within the system worked out?

In the years 1970 – 1974, the average annual budget deficit (on-budget and off-budget) was $14 billion.  In the years 2010 – 2014, the same number averages $ 969 billion.  A seventy-fold increase.  The total Federal debt at the end of 1974 was $484 billion; the comparable figure at the end of 2014 was $17.8 trillion.  A thirty-seven fold increase.

Federal Reserve assets in 1974 were $113.9 billion (see page 152); the current number is $4.5 trillion.  A forty-fold increase.

For comparison, the US GDP in 1974 was $1.55 trillion; in 2014 it was $17.35 trillion.  An eleven-fold increase.

What of US foreign interventions – dying and virtually dead in 1974 with the ending of Vietnam?  Today, the United States is directly or indirectly behind hot wars in Iraq, Afghanistan, Syria, Libya, Pakistan, Yemen, and Ukraine (and I am certainly missing a few).

The 1936 Federal Register was 2,620 pages long. It has grown steadily since then, with the 2012 edition weighing in at 78,961 pages (it has topped 60,000 pages every year for the last 20 years).


Taxes, spending, deficits, wars, financial intervention, laws and regulations – all increasing dramatically during the entire period of this moderate form of libertarianism.

Talk about futility.

Friday, January 22, 2016

BU2B, 2nd Edition

Introduction to the 2nd Edition

This post was originally published in August, 2014.  With this new post I have added several items and have updated various links.


All is for the best
Believe in what we’re told
Blind men in the market
Buying what we’re sold
-        Neil Peart, Rush

…history is a constant progression – onward and upward.

…the Dark Ages were…dark and technologically backward.

…the Middle Ages offered lawlessness and barbarity.

…the Catholic Church ruined western civilization.

…the Renaissance was a renaissance.

…King George was a tyrant.

…Americans won their independence.

…the founding fathers were selfless.

…the time during the Articles of Confederation was chaotic.


That was fast.

In response to my request, I have received feedback from Walter Block and others.  The several are names that you would know; if you respect libertarianism in the Rothbardian tradition, they are also names you would respect.  They have asked that I keep their names anonymous; contrary to my statement in the subject post, I have agreed to do so.

So, to summarize the anonymous feedback: You’re right.

I was sent the following by one of the prefer-to-remain-anonymous feedbackers, an excerpt from Rothbard’s The Ethics of Liberty, Chapter 13:

Thus, it should be quite clear that, under libertarian law, capital punishment would have to be confined strictly to the crime of murder. For a criminal would only lose his right to life if he had first deprived some victim of that same right. It would not be permissible, then, for a merchant whose bubble gum had been stolen, to execute the convicted bubble gum thief. If he did so, then he, the merchant, would be an unjustifiable murderer, who could be brought to the bar of justice by the heirs or assigns of the bubble gum thief.

Shooting someone for stealing a stick of gum – and in Rothbard’s example, not even a child.

Look, just because Rothbard wrote it doesn’t mean it is correct libertarian theory.  However, precisely because Rothbard wrote it, if you want to demonstrate otherwise you probably need to come up with something more than “because I wanted to.”

Now, on to Walter, who gave his OK to post the following; I offer it without comment:

I regard the Bionic Mosquito, and Bob Wenzel, as gifted libertarian theorists. The both of them. I regard both of them as friends of mine. Good friends.  I don’t mind it at all when friends of mine disagree with each other. Heck, I disagree with both Bob and the Mosquito on some few issues, plus with other friends of mine such as Murray Rothbard, Hans Hoppe and Stephan Kinsella, just to name a few. But it really bothers me, no, it sickens me, when the debate takes on not just the disineterested, calm, friendly, search for truth, which I welcome, enthusiastically, but also vituperation, nastiness, name calling, etc. I pride myself that I strive mightily not to engage in such activity even when debating enemies of Austro-libertarianism (I don’t always succeed, but I do try real hard), let alone with friends and intellectual fellow-travellers with whom I agree with on, oh, 99.8% of all issues, such as I do with the Bionic man and Bob Wenzel. Indeed, I have debated with both of them in the past, always cordially in all cases, and hope and trust this will always continue.

Please, Bob and Mosquito, be kind to each other in the debate over punishment theory you are now having with each other. Please, I beg you both, realize that you are both staunch libertarians. You are fellow soldiers in the intellectual fight for liberty. If people like the two of you cannot remain civil, and even more than civil when disagreeing with each other, then there is just that much less hope for our beloved movement.

Now to the specifics. I think Bob makes some good Austrian subjectivists points about only victims can know how much harm has been perpetrated on them by criminals. But, to think that victims and they alone may make up any punishment rules thay want on their own property, without notifying everyone else of unusual rules (like killing, or seizing coats, a la Donald Trump) I find completely incompatible with libertarianism (I make this point in my article on “murder park.” See below). Killing a child for stealing an apple I find totally incompatible with libertarian theory. Children are different than adults in libertarian theory, as they are in every other theory with which I am familiar. It is permissible to commit assault and battery on them, see my debate with Stephan Molyneux on this matter. Going to bed with a 5 year old girl, even if she “agrees” to do so should be a crime under libertarian law, as it is in all civilized societies, because children of that age are simply unable to give consent. It is much the same with apple stealing. They must be treated differently than adults, in terms not only of punishment theory after the fact, but even in defense of property during this criminal behavior. How, differently? More gently of course.

Murder Park:

Whitehead, Roy and Walter E. Block. 2002. “Sexual Harassment in the Workplace: A Property Rights Perspective,” University of Utah Journal of Law and Family Studies, Vol. 4, pp.226-263;

Block, Walter E. 2002. “Radical Privatization and other Libertarian Conundrums,” The International Journal of Politics and Ethics, Vol. 2, No. 2, pp. 165-175;

Block, Walter E. 2007. "Alienability: Reply to Kuflik.” Humanomics Vol. 23, No. 3, pp. 117-136;;jsessionid=0685BBB744173274A5E7CE3803132413?contentType=Article&contentId=1626605


December 9, 2013. Debate: Walter Block and Stefan Molyneux, Freedomain Radio on spanking children. Video:; MP3:

I hope and trust you don’t mind that I send this to Bob, too.

Best regards,


Walter E. Block, Ph.D.
Harold E. Wirth Eminent Scholar Endowed Chair and Professor of Economics
Joseph A. Butt, S.J. College of Business                   
Loyola University New Orleans
6363 St. Charles Avenue, Box 15, Miller Hall 318      
New Orleans, LA 70118            
tel: (504) 864-7934
fac: (504)864-7970
Skype: Walter.Block4             
If it moves, privatize it; if it doesn't move, privatize it. Since everything either moves or doesn't move, privatize everything.


I thank Walter, and also the several others who wished to remain anonymous, for their feedback.  However, perhaps the most succinct and insightful comment was offered at the subject post:

Black Flag January 21, 2016 at 3:09 PM

Wenzel hasn't defended Anarcho Capitalism, he has defended the judge, the jury, and the executioner, (all bundled together as one man) likely of statist ilk, who feel they can operate without consequences for error.

Why should Wenzel oppose the state when he's fine with an individual operating the same way? Is the libertarian objection to action, or the label attributed?

I wish I thought of this line of reasoning.  In sixty words, Black Flag said more than I did in ten-thousand.  Wenzel wants to create two billion tyrants.  This isn’t libertarianism.

Looking at Black Flag’s web site, it seems he has just started writing.  All I can say is, keep writing.

Thursday, January 21, 2016

Robert Wenzel: Libertarian Theory Allows the Death Penalty for Any Violation of the Non-Aggression Principle

No, he didn’t say exactly that.  Except that he did.

This is a very sad post for me to write.  If Wenzel is right, then libertarian theory is a dead theory to me.  If he is wrong, he is clearly demonstrating how little he understands about both expanding the non-aggression principle beyond its simple form as well as the application of the non-aggression principle to various real-life situations. 

I will enjoy neither option.  I lose something either way.

It is difficult to read his post.  He doesn’t understand culture.  He doesn’t understand governance.  He doesn’t understand the beneficial (and I say necessary) qualities in both toward developing and maintaining a libertarian society.  It is full of strawman arguments.  He accuses me of advocating government force when I have not.  It is written as if he has not gone past the first grade in libertarian studies.

Or maybe I have not gone past the first grade.  But if Wenzel is right about this, I will certainly not bother to enroll in the second grade.  If libertarian theory justifies death for any violation of the NAP, I will drop out.  Read the last sentence again; Marx and Engels did not spawn as evil a child.

First a few thoughts.

Libertarian theory is a fairly young philosophy.  One could easily say that it was nothing more than randomly-found ideas scattered in various philosophies before Rothbard began his prolific work.  This would place it at 50 years of age, more or less.  One could go back to some of the eighteenth and nineteenth century liberal and anarchic writers.  I don’t think you can go back much further – at least not for any identifiable, unifying theory.

I point this out because – being such a young theory – there are many things that libertarian thinkers have not yet worked out.  There are many questions on which many of us disagree, or that many of us believe libertarian theory cannot answer.  Someday there will be consensus on more issues; there will always be disagreements on some issues.  Christianity is two-thousand years old, and there are varying interpretations on many topics even here.

One such issue within libertarian theory is the issue of punishment / retaliation / penalty / whatever.  What punishment is consistent with libertarian theory?  Are there objective answers, or only subjective?  What I have read on this topic from libertarian writers offers guidelines, but no definitive, objective standards.  That doesn’t mean there will never be definitive, objective standards (although I strongly doubt that there will, because I doubt there can be).  There certainly aren’t today.

There is another question: What punishment is inconsistent with the non-aggression principle?  Again no way to draw a definitive line; however I know one punishment that is not.  Wenzel believes it is consistent with the non-aggression principle for a farmer to shoot and kill a child for stealing an apple.  I am certain this is inconsistent with the non-aggression principle.

Wenzel offers to me a definition of the non-aggression principle:

Here is the NAP as defined by Walter Block:

"The non-aggression [principle] the lynchpin of the philosophy of libertarianism. It states, simply, that it shall be legal for anyone to do anything he wants, provided only that he not initiate (or threaten) violence against the person or legitimately owned property of another."

I am glad he chose Walter Block; I will be calling on him shortly.