We are developing the social individualist meta-context for the future. From the very serious to the extremely frivolous... lets see what is on the mind of the Samizdata people.
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Diana Hsieh, a hardline objectivist of the Big-O variety, thinks libertarians like Tom Palmer, whom she cites in an article on her Noodlefood site here, are losing their nerve if they worry about attacks on civilian targets in places like Beirut. She writes:
Obviously, wars cannot be fought without harm to civilian populations. Governments and their militaries do not exist in some separate dimension from civilians, such that they might be uniquely targeted by an invading force. Enemy governments are thoroughly integrated into the territory over which they rule, depending upon its wealth, hospitals, roads, factories, trains, farms, ports, industry, people, and more. That’s why quickly and decisively eliminating the threat posed by an enemy nation cannot but require the bombing of so-called “civilian” targets.
Moreover, without active support and/or tacit submission from a majority of the civilian population, no government could maintain its grip on power. That’s why the vast majority of the population of an aggressive enemy nation are not morally innocent bystanders. The sometimes-awful luck of genuine innocents in wartime, such as young children or active dissidents, is a terrible tragedy. However, the party responsible is not the nation defending itself but rather all those who made such a defense necessary, particularly the countrymen of the innocents complicit in or supportive of the aggression of their nation.
I am very troubled by that last paragraph. Hsieh seems to be saying that civilians in a country that is led by a brutal government are, unless they do everything to rebel, more or less complicit in the crimes of that government. Therefore, they have little or no excuse to complain if bombs come raining down on their homes.
This way of reasoning involves, by an ironic twist, to a sort of collectivist “guilt” shared across a whole populace. If a family living say, in Stalin’s Russia or Hitler’s Germany have not actively sought to overthrow those governments, then they are somehow not terribly deserving of our compassion (Hsieh, to be fair, seems to exempt children and one or two other groups from this).
I entirely defend Israel’s right to do what is necessary to defend itself from terror groups like Hamas and Hizbollah, and alas, its actions may lead, inevitably, to the loss of civilian life. I consider myself pretty much pro-Israeli and have nothing but contempt for the bogus moral equivalence drawn in certain parts of the media between the actions of the Israeli armed forces and terror groups. But I have a real problem with the line of argument presented here by Hsieh. The ends do not always justify the means, and as moral agents, it is surely right to minimise loss of innocent life as far as possible if that can be done. For consider this: if the western powers had really thrown off all moral constraints about foreign populations in the recent past, then much of the Middle East would be a radioactive wasteland.
A while back I suggested that the the high price of gold may be a harbinger of rising inflation, and that even though some people suggest that gold prices are a fogeyish obsession of a few “gold bugs”, the price movement of this golden metal can still offer an early indicator of trouble.
I think I can say a mild “I told you so”. After having been off the radar for years, due to a variety of factors, inflation is rearing its head again. To an extent, of course, the cost of living has been rising in Britain a lot more than official statistics suggest because of the way in which Britain’s finance minister, Gordon Brown, has stripped out things like housing price movements and taxes to make the figures look better. (In all fairness to Brown, his Tory predecessors were no better in this respect). Anatole Kaletsky has a good article here warning that the mighty U.S. Federal Reserve is in danger of letting the inflation genie out of the bottle. A further rise in rates, he says, may be needed, possibly raising the risk of a recession. He may be right. The Fed’s key lending rate is 5.25 percent and has risen 17 times since its low-point around the time of 9/11.
It is a bit rich, though, for an unashamed neo-Keynesian like Kaletsky to bash the Fed for failing to be tough enough, and for not acting sooner, on rates. Kaletsky has not been shy of bashing the European Central Bank for its supposedly restrictive approach on interest rates. The problem of course is that no central bank chief, even if he or she has the wisdom of Solomon, can anticipate perfectly the right course for interest rates. If such a central bank makes an error, that mistake can be enormously costly in terms of jobs, livelihoods, even the loss of homes (I recall a now-departed commenter, called Euan Gray, dismiss such concerns with a sort of “let the experts sort it out” approach of his.)
The perils of central bankers getting the economic signals wrong explains why some classical liberal economists remain fond of F.A. Hayek’s argument for a return to a sort of commodity-backed, competitive currency system. Yes, such a system would have its problems and banks might go bust from time to time. But although such a banking system would have its crises, they would be relatively small compared to the risk of an entire economic region getting into trouble on account of a mistake by a central bank chief and his economists. The bigger and more powerful the central bank, the bigger the potential cockups. That remains for me a great attraction of Hayek’s idea: mistakes will get made, but those mistakes will be dispersed and people will have options to flee a delinquently-run currency.
Reuters journalist Paul Hughes chose to spend a holiday with his wife in Beirut. just as the violence broke out. Here’s his vivid take on what it is like in that city at the moment. When it comes to covering events in Lebanon with a salty mixture of black humour, PJ O’ Rourke, of course, remains the master.
The man who brought us the ultimate tough private eye, Mike Hammer, has died at the age of 88. I quite liked Mickey Spillane’s hard-boiled fiction, though goodness knows it never pretended to be Henry James or Proust (and was all the better for it, probably). Bob Bidinotto has a nice article saying farewell to the old fella. Here is a report over at Bloomberg. I am sure Hammer is laughing over a large bourbon somewhere before going out to tangle with treacherous dames and cut down the bad guys.
As I write this, I am reading a Reuters report saying that Britain could have the highest temperatures in recorded history later this week – possibly up to 39 degrees Celsius as warm air from Continental Europe moves north. Phew. Whatever the cause for a run of hot summers in recent years, there is no doubt now that working in Britain during the summer months would be a lot less pleasant were it not for the invention of air-conditioning. Mind you, it seems that Britain still has not quite figured out how to manage AC systems properly. In my time working in London, the systems have been frequently unreliable although my modern office in London’s Docklands is excellent. London’s Tube does not have it (the excuse I hear is that the tunnels are not large enough for the technology to work efficiently). Even so, the use of air conditioning seems to be spreading, although I don’t have reliable statistics to hand but just personal experience over a decade or more of going to different offices in town. Here is a story about how a hospital in Belfast is supposedly the first major building to use AC. (Belfast?)
→ Continue reading: Thank goodness for artificial cooling
I think Tory leader, windmill pioneer and attendee of uber-Chav celebrity bashes, David Cameron, might want to take a break from the social whirl and read this about the much-derided U.S. tax cuts of 2003:
In the nine quarters preceding that cut on dividend and capital gains rates and in marginal income-tax rates, economic growth averaged an annual 1.1%. In the 12 quarters–three full years–since the tax cut passed, growth has averaged a remarkable 4%. Monetary policy has also fueled this expansion, but the tax cuts were perfectly targeted to improve the incentives to take risks among businesses shell-shocked by the dot-com collapse, 9/11 and Sarbanes-Oxley.
This growth in turn has produced a record flood of tax revenues, just as the most ebullient supply-siders predicted. In the first nine months of fiscal 2006, tax revenues have climbed by $206 billion, or nearly 13%. As the Congressional Budget Office recently noted, “That increase represents the second-highest rate of growth for that nine-month period in the past 25 years”–exceeded only by the year before. For all of fiscal 2005, revenues rose by $274 billion, or 15%. We should add that CBO itself failed to anticipate this revenue boom, as the nearby table shows. Maybe its economists should rethink their models.
Britain’s Conservatives believed – at least during the 1980s when a certain Nigel Lawson was Chancellor – that cuts to marginal tax rates could actually generate more, not less revenue for the State, as well as being a good thing in its own right for widening economic liberty and reducing the bite taken out of the pockets of the citizenry. Now, I know that some libertarian purists out there might actually be suspicious about a measure that would raise more revenues, even if it is a good thing for individual taxpayers. I say let purity be damned. we know that politicians are not motivated much by supposed abstract concerns about the balance between the individual and the State these days, but the practical benefits of cutting tax rates should still resonate with our political classes. The Laffer Curve still operates, at least if you accept the WSJ article. Even current Chancellor Gordon Brown might wake up to the sort of facts that the Wall Street Journal is on about. It would be nice to think that the Tories would seize on such data, make a fuss, point out the benefits of flattening the tax code, simplifying it and cutting rates. Instead, unless I am missing out here, is silence.
Maybe the implosion of the current government means the opposition can afford to slump in the hammock during the back end of summer and wait. But it would be nice to think that they could be a tad more ambitious. Only a tad – I would not want our Dave to break into a sweat or anything.
American economist Thomas Sowell remains, in my view, one of the “must-read” authors for folk interested in the case for liberal markets and critiques of well-intentioned but hubristic social policy. In one of his books, The Vision of the Anointed, he hits upon a key fact that is so often ignored by writers making statements such as “X percent of the population own Y percent of the wealth”, and then proceed, in terms of great indignation, to argue for massive redistribution of wealth to rectify said terrible state of affairs. Sowell points out that what such statements miss out is that we are all getting older, our lives change, and as we do so, it is common for folk to pass from one wealth bracket to another:
“One common source of needless alarm about statistics is a failure to understand that a given series of numbers may represent a changing assortment of people. A joke has it that, upon being told that a pedestrian is hit by a car every 20 minutes in New York, the listener responded, “He must get awfully tired of that!” Exactly the same reasoning – or lack of reasoning – appears in statistics that are intended to be taken seriously.” (page 43).
I am still unconvinced of the isolationist argument vis Iraq that would have had Western militaries – and probably as a result civilians – quit the entire Middle East, and leave Saddam to wreak havoc as he has before, but my goodness, the case for non-interventionist foreign policy has never looked so good at the moment as the insurgency in Iraq gets worse. Jim Henley sums up the “do as little as possible” school of libertarian foreign policy as well as anyone:
If a war is worth years of struggle, billions squandered and thousands or tens of thousands of dead on both sides, why isn’t peaceful change worth as much? Why is it a “bold initiative” to announce a “generational struggle” to transform a region of the world through a war that might or might not achieve its ends, but preemptively absurd to launch a generational struggle to transform the same region through nonintervention, to instill liberalism and justice by exemplifying it? Because people might get killed? People get killed the other way. Because it might not work? Look around you. The other way isn’t working now.
My main problem with Jim’s argument is that setting an example to the dictatorships, thugocracies etc of that region would strike me as a fairly drawn-out, if not rank impossible, endeavour (that’s putting it politely, ed). We are talking about a process that might last thousands of years. And I am afraid that in the meantime, the various despots in that region might not quite get with the Enlightenment programme and develop a continued fondness for blowing infidels up. At best, I would say that such folk might, even at their craziest, be deterrable, which is why I think the libertarian world-view – if I can presume to call it that – should focus on deterrence, and forswear the temptations of what folk called pre-emptive action. But again – and Jim and others have to answer this question – does observing the niceties of national sovereignty always trump other considerations? For me, one of the clearest-cut examples of justified and smart pre-emption was the Israeli airforce’s bombing of the Iraqi nuclear facilties in the early 1980s. No doubt some libertarian “leave-well-alone” foreign policy commenters fulminated about that event at the time, in a way that may have echoes now in what is being written about Israel’s actions in Lebanon (see the posts below).
What to do?
There is now a very high chance that Eurotunnel, the Anglo-French consortium operating the Channel Tunnel rail-link between London and the continent, could be liquidated by this September, having failed to reach a key agreement earlier this week with creditors. The saga of how the operator would persuade a group of banks to let it restructure a huge pile of debt has been chugging along for months. Now there is a real risk that this marvel of civil engineering could be known as one of the biggest transport commercial flops in history. The free-marketeer in me says well, the venture was never based on fully commercial grounds in the first place. The folks concerned probably no doubt rightly thought that if the project was a flop, then the fortunate taxpayers of Europe would pick up the tab, just as they did with that other venture of high-tech wonder and dubious economics, Concorde. The romantic in me would be very sad to see this wonder of rail come to an end. I have used the Eurotunnel service several times, both for work and for short breaks to France in recent years. Every time I have marvelled at the smoothness of the service, only occasionally marred by delays in the English side of the operation, or by the odd rude French ticket inspector.
It certainly beats messing around in airport lounges, that is for sure.
More here on the arrest of Labour head fund-raiser Lord Levy over allegations about tapping up folk for party donations in return for peerages. (See Alex’s post immediately below this one). First question: is this really the silver bullet that might finish off Blair? He has shown incredible resilience in the face of a huge dollop of scandals since 1997: Bernie Ecclestone affair, Mandelson’s various transgressions, a delinquent and violent deputy Prime Minister; Cherie Blair’s interesting spending habits, David Blunkett’s abuse of office and manifest failings, the sheer uselessness of his successor, Charles Clarke; the suicide of government scientist David Kelley and the whole spin-doctoring of arguments about WMDs in Iraq. In less than 10 years, the Labour government has established a record for venality, corruption and rank incompetence that it took the Tories 18 years to acquire. Quite some achievement, of sorts. Of course, although its economic record is not quite as splendid as some would claim, the relatively-good performance of the economy under Gordon Brown has kept the government of the day in reasonably good shape.
But for how much longer can even this part of the Blair record be relied upon? Yesterday, the Bank of England warned in one of its regular publications that there remain significant risks in the UK financial system, particularly concerning the amount of debt and consumer borrowing there is. Our public finances are slipping deeper into the red despite what has been a relatively decent run of economic growth, so goodness knows how bad those finances could get if there were to be a serious slowdown, or some shock to the financial system.
As a side note, it would be churlish not to praise indefatigible digger-up of news about the Levy saga, blogger Guido Fawkes. If I were the publisher of Private Eye magazine, I would be worried about the competition. Guido has been all over this story for weeks.
“We continue to “mind the gap”. The subject has not lost its power to provoke and wound and illuminate. We still talk quite a bit about it in various ways: journalistic-facetious, or pretend-anthropological, or even old-fashioned snobbish. But that does not mean that we are at all comfortable with the subject. On the contrary, we are often decidedly uneasy when it is brought up, and we do not care for it when the question of class is described as “Britain’s dirty little secret”. We tend to be especially resentful when the Americans or the French describe Britain as uniquely class-divided.” (page 105)
“We are often told that deference has disappeared from modern Britain. Yet the adulation of the rich and famous is surely as fulsome as ever. In hotels, restaurants and aircraft – the sites of modern luxury – the new upper crust is fawned on as egregiously as old money in its Edwardian heyday. All that has changed is that the composition of the upper class has changed, as it has done roughly once a century since the Norman Conquest…..what has almost disappeared is deference towards the lower classes. Throughout the two world wars and the decades following both of them, the lower classes were widely revered for their courage in battle and their stoicism in peace. Values such as solidarity, thrift, cleanliness and self-discipline were regularly identified as characteristic of them. That is no longer the case.” (page 107)
Mind the Gap, by Ferdinand Mount 2003. Definitely food for thought, and despite the title, is not a plea for some sort of mushy egalitarianism. I thought about this book while reading the comment threads here bemoaning the rise of the middle class football fan as some supposed frightful imposition on a working man’s game. We still bother about class, it seems.
In case anyone missed it, here is a fine article summing up what I think is the truth behind the case of the three NatWest bankers who are to be extradited to the United States on charges related to the collapse of Enron. The author, business writer Jeff Randall, fingers what he sees as the reason why the banks have been so coy about defending their employees from the U.S. legal authorities.
Unlike Stephen Pollard, who huffs and puffs about how this controversy is largely a matter of anti-Americanism, I do not like the smell of this case at all. I think Pollard’s argument – which has its merits – misses the point of how one-sided the operation of U.S. extradition powers are. These men are not regarded by the British authorities of being guilty of any offence. The U.S. authorities appear not – to the best of my knowledge – to have given even the semblance of a prima facie case justifying the extradition of this trio. And yet as the article points out, while the U.S. can use these powers – supposedly justified by the War on Terror – Britain has no corresponding right to extradite alleged U.S. wrongdoers (powers associated with terrorism have a habit of branching out).
As with the British blogger Clive Davis, I am a pro-American who also thinks the U.S. authorities sometimes do a lousy job at treating what they should regard as their close allies. Okay, I can hear the comments coming that even if they did a great job, it would make no difference. I am not so sure. While I agree with Stephen Pollard that U.S. authorities are arguably right to get nasty on financial wrongdoings and are often tougher than we Brits, this use of extradition powers looks a step too far. It does not strike me as smart diplomacy or right law, and I hope, perhaps naively, that the British government shows rather more backbone on this case than hitherto.
Here is more on the story, and more here.
UPDATE: And of course let’s not forget the continuing outrage of the EU arrest warrant. I should have mentioned this fact earlier, in case our American readers think I am picking on them.
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Who Are We? The Samizdata people are a bunch of sinister and heavily armed globalist illuminati who seek to infect the entire world with the values of personal liberty and several property. Amongst our many crimes is a sense of humour and the intermittent use of British spelling.
We are also a varied group made up of social individualists, classical liberals, whigs, libertarians, extropians, futurists, ‘Porcupines’, Karl Popper fetishists, recovering neo-conservatives, crazed Ayn Rand worshipers, over-caffeinated Virginia Postrel devotees, witty Frédéric Bastiat wannabes, cypherpunks, minarchists, kritarchists and wild-eyed anarcho-capitalists from Britain, North America, Australia and Europe.
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