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.
Samizdata, derived from Samizdat /n. - a system of clandestine publication of banned literature in the USSR [Russ.,= self-publishing house]
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Matt Welch makes some excellent points about the reality of world trade but the following bit suggests he does not read the Samizdata very often.
If free traders spent as much time railing against rich-country protectionism as they do making fun of the anti-globalization kids, the pig-puppet audience would dwindle to a core of fog-headed Maoists, and more importantly, destitute people around the world could vault out of poverty much faster.
We are wounded Matt! You mean we are not your default page when you boot up the ol’ box every morning? We often go though periods of railing against the immorality and stupidity of protectionism. Such as:
Stupidity beyond the measure of language by Natalija Radic on February 1st:
Jospin is a man who is responsible more than any other political figure in the EU (and that is saying something) for people like me being fined and harassed by EU states for trying to do business within the EU because I am an outsider, just another Slavic white nigger girl. Naturally he takes much the same view of Africans and Asians who try to do business in the EU.
Comments worth repeating by Perry de Havilland on January 30th:
To be “strongly against world trade” is to be in favour of poverty and against free association. It is to favour force over choice. It is to favour death and famine in the third world. Anyone who actually wants for the peoples of South America, Africa and Asia to prosper should be demanding not an end to world trade but the removal of all barriers to entry to the US and EU markets. At a stroke that would result in cheaper products for common working western people as cheaper African, South American and Asian goods become available. Immediately the economies of third world nations would improve as they could sell their products without immoral grotesque discriminatory tariff barriers.
What free trade actually means by Natalie Solent on December 18th 2001:
So the European Union, having stopped Africans making a respectable living as producers and traders by denying them access to us, then bestows a lesser largesse via ‘Third World Aid’. Adding insult to injury, the EU then expects gratitude from the very people they have discriminated against. Of course what happens is that Africans, now being dependent on largesse rather than their own efforts, take on the character of beggars, whiny when desperate and sullen when temporarily a little better fed. We in our turn take on the character of patronising social workers-cum-lords of the manor. What a pity, when we could be interacting as equals and fellow human beings.
… and those are just the ones I can be bothered to find. So you see, Matt, here on Samizdata this particular group of free traders really really doesn’t like protectionism and we attack it on both economic and moral grounds quite often.
Andrew Sullivan is pleased that Irish singer Bono is not slagging off drug companies. Well a word of advice, Andrew… don’t get your hopes up that Bono’s seeming conversion to the forces of reason is more than a fragile veneer. He does have this disheartening knack for seeming to make sense, only to dash your raised expectations on the rocks of reality a little further down the road, as I observed back on January 14th 2002 in the article Teeth grinding illogic and grotesque conflation…or perhaps genius?. He is either a perverse genius or a jackass. You choose.
Suman Palit on the Kolkata Libertarian has some interesting links and commentary about hawala, a system of trust based independent networks for transferring money across borders completely outside ‘official’ financial systems. I have touched on the subject of hawala in previous articles and Suman points out the absurdity of US (and other) efforts to try and stamp it out
Criminalising such a large-scale human endeavour that is rooted so deeply in history is laughable and idiotic. Like the failed drug war which penalizes consensual behavior and therefore can never be effectively enforced, stigmatizing hawala simply drives it deeper underground.
The fact is that there are millions of people who simply do not see why the state, any state, should have oversight over their business. The usual demands that people must simply ‘trust the authorities’ is seen as fundamentally irrational in many communities. Too many people have both direct experience and deep societal folk memories that such contentions are simply foolish, leading to a whole culture of economic activity occurring under the radar. The very essence of hawala is that of an audit trail-less trust within a closed and multiply redundant distributed network.
Not only do I predict the US will fail utterly to regulate hawala, I expect that their actions will once again prove the law of unintended consequences is alive and well and living in a town near you. The very actions of the financial regulators will reinforce support for it by proving why hawala is still as needed as it ever was: to enable genuine free trade when princes and policemen try to restrict it, and to avoid confiscation of the proceeds of that legitimate trade by the same people.
Recent events in Argentina have helped drag quite a few things out into the light that would rather have remained skulking in the shadows.
One of the things that is now clear is that the idea a debtor nation can be ‘too big to be allowed to fail’ is revealed to be a myth. When Ecuador defaulted on $6 billion worth of bonds in 1999, people just shrugged it off as ‘only Ecuador’. Yet now we see Argentina going the same way to the tune of $132 billion.
Another thing has become clear about the IMF. Anne Krueger, the IMF’s deputy managing director, has let it be known that the fund is very keen to get out of the ‘sovereign bailout business’. To this end the IMF has some fantastical plans for ‘harmonising’ international bankruptcy laws which will of course come to nothing. Yet the source of the impetus for restructuring the IMF’s relations with debtor nations is quite revealing and not one you might think. Much of these ‘new’ ideas being floated come in almost whole cloth from Jubilee Plus, a leading anti-globalization pressure group whose very name you would think would be anathema within the hallowed halls of an ostensibly pro-capitalist organisation like the IMF purports to be. In fact what is clear is that Jubilee Plus and the IMF are just different sides of the same pro-stasis coin, profoundly hostile to dynamic free trade networks and in favour of state centred status rather than value based economics.
It says much about the inevitable evolution of the IMF from a supposed facilitator of the global capitalist economic order to being little more than the financial arm of a network of pro-stasis organisations underpinning almost every kleptocratic state on the planet. For as long as the IMF is not just happy to prop up heavily regulated force based value destroying economies of the sort favoured by Jubilee and its ilk, there is little motivation for financial institutions to tailor their lending to the economic realities of a nation’s governance. Yet there is always the fond hope that while the IMF ponders its restructuring, a few really large international lenders will feel some serious pain.
What is really needed is for a few nice large international names to go belly up as there are few things that get the financial world’s attention better than that. I am thinking of people like Citigroup, FleetBoston, Banco Bilbao Vizcaya and Santander Central Hispano, who are all massively exposed to the mess in Argentina… sadly this is probably not going to happen but if it did, what we would have is a clear causal link established between a willingness to lend to kleptocratic governments and disaster. This in turn would impose a real cost in terms of an inability to borrow on governments which pursue anti-economic statist/stasist policies.
Just as companies with bad ideas must be allowed to go broke, so must governments. Sovereign default can be very invigorating to the cause of liberty and advocates of true non-crony capitalism should oppose any institutions which seek to ameliorate the link between government actions and the consequences of those policies. And if those governments, such as in Argentina, are democratic then all the more reason for allowing the voters of that country to reap the bitter consequences of their theft-by-proxy mandates. Let the financial tumbrils roll and lets see whose heads get cut off without the Scarlet Pimpernel of the IMF to come to the rescue.
Pakistan has a very large expatriate community scattered across the world, particularly in the UK and the USA. The peoples of the sub-continent also have a deeply engrained and entirely laudable distrust of governments poking around in their affairs, which is why the hawala system of moving money around globally is so popular with people from that part of the world.
In recent weeks there has been a huge inflow of capital from the Pakistani diaspora back to Pakistan due to the scrutiny of US investigators looking ostensibly for Al Qaeda funds. Of course there is widespread and quite justified belief amongst Pakistani businessmen that where the anti-terrorist investigators tread, the IRS will not be far behind looking to see what they can confiscate. Sub-continent businessmen have been on the receiving end of shakedowns like that from potentates, princes and nations for centuries and have well honed cultural reflexes in such matters. The simple solution: move your money where the US authorities cannot see it, by bank transfer if possible or via the invisible hawala system if not.
Networked distributed capitalist systems like this are extraordinarily resilient and are fueled by deep seated and entirely admirable non-deference to state authority. Just as the justified fight against Al Qaeda is also being used to fulfil an unjustified a wish list of civil liberties abridgements, so too are the statist enemies of free trade on both left and right using it to move against the sort of small scale (though large in aggregate) trans-border capitalism at which people from the Indian sub-continent so excel. It is for reasons of control that Big Capitalism and The State get on so well: bureaucrats can meet with a few hundred CEOs of vast companies and reach understandings to their ‘mutual benefit’ (though not to anyone else’s). Hundreds of thousands of small scale truly capitalist ventures with trans-border cash flows however are impossible to even monitor, let alone control: which is of course why they are such a good thing.
French Prime Minister Lionel Jospin has demanded an end to free(ish) trade in favour of a global system of ‘managed trade’ called mastered globalization. In a typical stream of anti-life economics and adulation of force based resource allocation, Jospin states that he, and people like him, should have a say in what Americans or British or Japanese or Nigerian or Lebanese or Croatian people can trade with each other across borders and under what conditions. When he says “mastered globalization”, no prize for guessing who he has in mind to be the ‘master’.
Jospin is a man who is responsible more than any other political figure in the EU (and that is saying something) for people like me being fined and harassed by EU states for trying to do business within the EU because I am an outsider, just another Slavic white nigger girl. Naturally he takes much the same view of Africans and Asians who try to do business in the EU.
He called for donor countries at the Economic and Social Council in Paris to commit to “reduce poverty by 50 per cent until 2015”. He could of course do this at a stroke by resigning from office along with all the other lying Socialists, Social Democrats (socialists), Democrats (socialists), Liberals (socialists) and Christian Democrats (socialists) across Europe who prevent so much of the world from making a living due to their trade barriers that discriminate against us. If that happened, I guarantee poverty would be reduced by 50 percent by 2015.
If you want a glimpse of the future, here is a truly astonishing article that I must say confirms many of my views about spontaneous networks.
The online fantasy game EverQuest lets players create and control characters – or avatars – within a fantasy world called Norrath. Characters gain skills and possessions that they can then trade with other players using the game’s currency of “platinum pieces”. However, many EverQuest players have found this process too complicated and have instead opted to sell their assets for real money though trading web sites such as eBay
Read the whole article, it is thought provoking stuff with real-world implications.
Over on Little Green Footballs (also see link under ‘posh blogs’ section in sidebar), there is a lengthy series of entries in the comments section under an article about globalization and the people who are heading to New York to protest against it. Someone called Michele stated that she was “strongly against world trade”. This astonishing remark was something that had to be answered and so I will repeat my remarks here:
To be “strongly against world trade” is to be in favour of poverty and against free association. It is to favour force over choice. It is to favour death and famine in the third world. Anyone who actually wants for the peoples of South America, Africa and Asia to prosper should be demanding not an end to world trade but the removal of all barriers to entry to the US and EU markets. At a stroke that would result in cheaper products for common working western people as cheaper African, South American and Asian goods become available. Immediately the economies of third world nations would improve as they could sell their products without immoral grotesque discriminatory tariff barriers.
Also, as a laissez-faire capitalist libertarian, I am strongly opposed to the World Bank, the WTO and the IMF… these are institutions that support crony capitalism and big-government. They subsidise neo-national socialist stupidity like that in Argentina and despotic kleptocratic regimes across the globe.
I am in favour of true free association and therefore laissez-faire and true globalization. I reject collectivism in all its coercive left and right wing forms and the violence and poverty they always lead to. Individualism and laissez-faire capitalism without borders is the only moral option and the only option that can actually work at all in the long run.
World domination, it seems, is all the rage these days. If it isn’t self-immolating Islamic jihadists than its self-effacing Kofi Annan
And, once again, it looks like the US military that is taking the battle to the enemy in the shape of the formidable Colonel Oliver North who has rather brusquely told the United Nations exactly where they can stick their ‘Global Tax’
Clearly feeling the need to pick up the ball that was dropped by the Soviet Union, these posturing pompadours in cheap suits are working overtime to impose global wealth redistribution. Not to mention global equality, social justice, environmental protection and just about every other canard of a typical 1960’s student teach-in
Anyone who harbours misty-eyed romantic notions about the UN should disabuse themselves as a matter of the utmost urgency. It is not just an organisation that has long outlived its usefulness, it is the dystopic, despotic NWO-in-waiting
When George Bush has finished mopping up Al-Qaeda it might be prudent for him to unleash a few daisy-cutters on this lot. After all, it is always better to nip these things in the bud
Over on Live from the WTC, blogger Megan McArdle writes in favour of the abolition of taxation on corporate income. It is a good albeit lengthy article that is well worth reading.
And Megan, the truth is “When the revolution comes, she’ll be the first one with her back against soft silk sheets.” Forget the empty threats of the left, the future belongs to the radical evolutionaries.
I am in the process of moving, from my native Michigan to the western suburbs of Washington DC. When I closed on my current home in April 2000, I financed the loan at 7.75% apr for 30 years. I am currently qualified to borrow at 6.40% for 30 years. The yield on 30-year US treasury bonds has fallen by a similar amount.
Why do I bring this up? Remember, back in 2000, American politicians were talking up the surplus. Today, thanks to recession, a flat stock market and post-911 spending, the US will probably finish with a deficit in fiscal 2002. But according to a novel theory recently introduced by Senate Majority Leader Tom Daschle, federal deficits cause mortgage rates to rise! So see, tax cuts would increase the deficit, which would increase mortgage rates, which would make new home purchases more expensive, which would hurt working families. Well then, if that is true, why is my lending rate so much more favorable now than it was when the US budget was solidly in the black?
The US does not finance much of its debt with 30 year bonds. In fact, the duration of the national debt (a fancy way of saying the average time to maturity) is just under 5 years. The federal treasury does not contribute very much to the demand for long-term funds. So it should not be surprising to learn that there is essentially no historical relationship between federal borrowing and mortgage rates. In fact, the US did not start to aggressively work down the duration of the debt until the Democrats and Treasury Secretary Rubin came into power!
If Daschle wants to pay down the debt, why would he want to do it in a period in which yields on long-term debt were falling? As anyone who stayed awake in finance 101 knows, prices and yields move in opposite directions, so lower yields mean that it would cost more to retire long-term debt from bondholder’ hands. This would amount to little more than a subsidy paid by US taxpayers to bondholders, who increasingly are foreign investors.
Politicians used to be smart enough to know that they aren’t very smart about economics. Senator Daschle evidently does not feel constrained by his ignorance.
Brian Linse has responded to my remarks, sort of, about capitalism and the reality of monopoly on AintNoBadDude, though he does not appear to have actually read the article I wrote, or if he did, he obviously did not understand it.
Speaking of Team Sami, Perry has a post on global capitalism or something… Ok, I’ll just admit that I have no idea what the fuck Perry is talking about. I think I may have inadvertantly triggered some primordial proto-libertarian confluence of meta-contextual rhetorical lilliputianisms when I mentioned turn of the century railroad monopolies. Or not. Anyway, just a reminder: E N R O N.
Brian’s obsession with Enron is revealed for what it is: political rather than economic.
My remarks were about the nature of markets and how the effect of regulations is often to cause the very problems they are intended to alleviate, such as monopoly and unsustainable bloated entities like Enron. One does not have to agree with my views but I think they were pretty easy to understand. But clearly Brian is only interested in how Enron’s collapse can be used to hurt the Republicans and thus his eyes glaze over when people like myself, who care nothing for either his precious Democrats nor his detested Republicans, wants to talk about economics.
Fine, no problem Brian. Feel free to continue to opine about Enron without having a clue how real world economics work if that is what excites you, but I think I will decline to get involved in that sort of ‘mass-debate’.
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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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