Sunday, June 25, 2017

Civilization





I recently went to a talk on slavery in my hometown of Warren Rhode Island where the slave population like the rest of Rhode Island was 10% of the population before the Revolutionary War. Since the rate in Massachusetts was 2% and Connecticut was 3% Rhode Island was the hotbed for slavery in New England.  What to me is astounding is not that the rate was so high in Rhode Island but that it was so low in the rest of New England. The fact that it was so low elsewhere amazes me because for all of human history up to that point slavery in some form was normative behavior. If you consider colonialism as a means of offshoring the institution then slavery really didn’t become universally institutionally condemned until the last half of the last century.[1]

I don’t think this happened due solely or even principally as a result of a great moral awakening but was largely the product of new technologies, abundant cheap energy sources (i.e. fossil fuels) and capitalism. 

Paul Kennedy, in the introduction to his book, The Rise and Fall of Great Powers, makes the case that Europeans and their descendants became the world leaders for at least the last 250 years because they lived in a system where relatively small nation states were constantly competing culturally, militarily, and perhaps most importantly economically. As a result in this hyper-competitive environment, virtually every significant technological and engineering advance from the steam engine to the microchip originated in Europe or the United States. These engineering marvels allowed man to replace manpower with brainpower and fossil fuels. At this point mankind could finally afford to see that slavery (at least when it is right next door) is morally repugnant. *

As with slavery the liberation of the “weaker” sex has only come as a universally acceptable standard in the last 50 to 100 years.[2] Prior to that for most of human history, societies were heavily patriarchal and dominated by men. I would maintain that when the value of brainpower exceeded that of brawn both actually as well as symbolically women were allowed for the most part to take their rightful place in the world. Women are taking full advantage of this. Colleges and profession, that were almost or actually exclusively men only clubs, (My alma mater and profession) are now majority female.

To be sure, indentured servitude and slavery as well as gender bias still exist in the world but civilized mankind universally condemns them.   We are not perfect but, in the spirit of the founding fathers, we are more perfect.

And the driving force behind all this liberating creativity is capitalism.  It is capitalism that unleashes the creative spirit of inventors and artists and entrepreneurs to continually come up with services and products that increase human productivity and make the enslavement of our fellow man obsolete.


During the 20th century mankind ran an experiment. For most of the first half capitalism competed with communism (not socialism). Communism failed and in the process killed more people in absolute numbers and perhaps as a  % of mankind than any other institution** in human history. After the collapse of the communist economic system and the more or less the universal embrace of capitalism throughout the world more people have been raised out of poverty both as an absolute number and as a percentage of mankind than any time in human history. 

For most all of human history the problems of mankind were problems of “not enough,” not enough food, water, shelter.  Today for all those who have escaped poverty in the last three or four decades those are no longer problems. Another way of looking at this is that the maldistribution of wealth has improved more in the last 4 decades than any time in human history.

Yes our over abundant life style causes us problems. This also is unique in human history. We have too much trash in our landfills, we put too much CO2 into our atmosphere, and perhaps we have too many of us. If we have to have problems these are the kind of problems we want to have. They are solvable collectively (see Paris Climate Agreement) but also we have the freedom to make choices around them individually. We can choose how much trash we create, how much carbon we use, how many kids we have.

On the one hand I think we take for granted the blessings of the abundance that surround us. Furthermore, it relies on a vast complex interconnected set of systems, institutions, and relationships to function. It is not clear to me exactly how fragile the system is. Certainly when large air carriers are grounded world wide because their computer system goes down, this is a hint at how fragile the system might be. War, pestilence, or environmental upheaval could upset the system on a global scale and send us back to an earlier darker age.

On the other hand there is a darker side to the present age we live in as it is.  There is a feeling in all our abundance that something is not quite right with the world we are living in.  There are a lot of ideas of just exactly why we feel that way.  In my next blog I will touch on a few of them.


* de Tocqueville notes that in Athens their were 20,000 citizens in a population of more than 350,000; the rest were slaves. [3] I am not sure the treasures of Archimedes ***, Aristotle, or Aeschylus would have been there to pass down to us if they had day jobs. So while we have assigned, hopefully permanently, slavery in all its forms to the dustbin of history, I would like to acknowledge a profound sense of gratitude to the servile classes who for eons were the engine that propelled civilization forward. They gave the leisure class the time to enrich themselves, admittedly, first but then all of us to the point that we could forgo their exertions in favor of more humane means of production and a more abundant lifestyle for all of us.

**Genghis Khan may be responsible for a higher percentage of deaths but the data on this is hard to find.

*** Yes, Archimedes lived in Syracuse not Athens but the principle is the same and I couldn’t forgo the alliteration.

Addendum: Last Tuesday I attended a lecture at Brown titled What Money can Buy; Entrepreneurship, Ethics, and Human Flourishing by Peter Boettke, professor of Economics and Philosophy at George Mason University. Over the course of his lecture he made many of the same points I have above, of course in a much more learned and erudite manner. Two points he made I would like to reiterate here.
The first is graphically illustrated below.  Around 1950 there is a flex point where the number of people not living in poverty accelerates (probably coincident with recovery from World War II). Then around 1980 there is a steep and persistent plunge in the number of people living in absolute poverty (probably coincident with the end of communism). The result is that the number of people living in absolute poverty has gone from more than 90% of the world’s population to less than 10% with most of that change occurring in the last 50 years.


The other point that he made was that while life as Hobbes described it may be ugly brutish and short mankind’s propensity to barter and trade as Smith said gives mankind the opportunity to build lasting trusting relations with non-related peoples on the other side of the river, on the other side of the border, on the other side of the world. Boettke suggests that capitalism is not only the wellspring of unprecedented prosperity it has the salutary effect of fostering what peace we currently have.


Geoff Berg



[1] Universal Declaration of Human Rights Article 4
[2] Universal Declaration of Human Rights Article 1

[3] Democracy in America Volume II Section 1 Chapter XV The Study Of Greek And Latin Literature Peculiarly Useful In Democratic Communities


Tuesday, June 6, 2017

Capitalism the game we play; Choosing the Refs




Disinterested : free of any interest especially of a pecuniary nature :  impartial
 
Capitalism is the game we play and government creates and enforces the rules. Money (capital) is the marker by which we keep score in the game. As much as possible we want the rule makers and enforcers to be impartial and free of any interest especially of a pecuniary nature. We want our politicians disinterested. 

Now if the people who are writing and enforcing the rules are playing the game that is communism where government owns the means of production (capital). That is one of the minor reasons why it ultimately failed but the principle reason why it wasn’t fair. 

On the other hand, if the people who are playing the game pay the people to make rules and call it the way they need it that’s bribery but for many people across the political spectrum that is also campaign finance in its current state.  While campaign contributions don’t go directly into the pockets of the politicians, if there livelihood is proportionally dependent on the largesse of their contributors then they are not free of any pecuniary interest and are no longer disinterested. Whether it is the lament of this influence of the 1% or the cries to “Drain the Swamp!” people across the political spectrum recognize a problem.

Free:    1) Made or done as a matter of choice and right: not compelled or restricted
One of the hurdles, and rightfully so, in crafting meaningful campaign finance reform is the first amendment. “Congress shall make no law . . . abridging the freedom of speech . . .”
Free     2) Not costing or charging anything
Free speech is a sine qua non of democracy and this is most especially true of political free speech. That said when it comes to campaign financing its not the speech that is being paid for but the airtime or print space to make it accessible. So is “free speech” really free if it cost money? Do the Koch brothers or George Soros really have more free speech than I do just because they have more money? I think most readers from across the political spectrum feel that the answer to the last question should be no.

So is there a way to get money out of the political process at least in terms of campaign finance and still protect free speech? I have some ideas about this but at least for the time being I am not going to be prescriptive. What I would like to do instead is suggest a process for arriving at the solution to this problem. The process is not mine so I am going to give a little history of how this idea came about and then discuss the solution or more correctly the framework for a solution.

[1]

Both politicians agreed on the spot to support such a plan. However, once they got back to Washington they backed away or did little to support the plan. Of course, it never did go anywhere and





* The Base Realignment and Closure Act of 1990 is one of the most successful pieces of legislation I have seen in my lifetime. Instead of the pork barrel politics of “I’ll save your base if you save mine” a disinterested commission decides what is essential to the efficient maintenance of the armed forces. While this solution is most appropriate for campaign finance reform this format could be used for almost any type of legislative initiative. For instance, congress could appoint a commission and set a dollar amount and time frame for infrastructure repair. Instead of bridges to nowhere, the paying public would get the most critical jobs attended to without a lot or any pork.