Most Recent Quotations

It occurred to me today as I was adding a quotation or two, that new quotations would also be a good thing to post to this blog.  To start off, I'm posting the newest half of the quotations.  In  the future, I'll try to keep it much shorter.


From:  Most Recent Quotations

One cannot overstate the childishness of the ideas that feed and stir the masses. Real ideas must as a rule be simplified to the level of a child's understanding if they are to arouse the masses to historic actions. A childish illusion, fixed in the minds of all children born in a certain decade and hammered home for four years, can easily reappear as a deadly serious political ideology twenty years later.
Sebastian Haffner, "Defying Hitler: A Memoir", pg. 17.

Economics is luxuriant with fallacies, because it is not a natural science like physics or chemistry. Propositions in economics are rarely absolutely true or false. What is true in some circumstances may be false in others. Above all, the truth of many propositions depends on people’s expectations.
Robert Skidelsky, "Four Fallacies of the Second Great Depression"

They only call it class warfare when we fight back.
A popular bumper sticker.

We are going to need a bigger and better government. The private unregulated market does not do well at health-care finance, at pensions, or at education finance. The private unregulated market does not do well at research and early-stage development. The private unregulated market does not do well with commodities that are non-rival, or non-excludible, or produced under conditions of greatly-increasing returns to scale. We are, in all likelihood, moving into a twenty-first century in which these sectors will all be larger slices of what we do. Thus in the twenty-first century a well-functioning economy will need a larger government share in the economy than was needed in the twentieth century.
Brad DeLong, "My Take on the Seven Things We Need to Focus on for Equitable Growth in America: Thursday Focus"

Without question, Pax Americana was the best and least hated of all grand paxes. [...] the U.S. defense umbrella has, since 1945, allowed most nations to spend far, far lower fractions of national income on warriors than at any time in history, allowing them to divert more to education and development. Look up the stats and be amazed! And Steven Pinker's proof that violence has plummeted under the era of Pax Americana.
David Brin, "Pondering Pax Americana and the government shut-down"

[...] the counter-mercantilist pattern imposed by Marshall's unusual Pax Americana favored transferring low level, labor intensive industries (e.g. textiles) en masse to poor regions around the globe in a cascade sequence that uplifted, successively, Germany and Japan, then Korea and Taiwan, then Malaysia and Singapore and so on, until right now this program of "foreign aid via WalMart" is raising up more than a billion people in China and India at the same time.
David Brin, "American Exceptionalism... versus what has made America exceptional"

Mr. Coase’s work cannot be read as a case for minimal government. On the contrary, his message was more purely pragmatic: Because we can’t negotiate efficient private solutions most of the time, we must ask whether laws and other institutions can help steer us toward solutions we would have chosen if negotiation had been practical.
Robert Frank, "Ronald Coase, a Pragmatic Voice for Government’s Role"

[...] why holding up the Gilded Age as a libertarian utopia is wrong-headed. It’s not because the liberty was inequitably distributed. As roger was saying in the previous thread, it’s because America in the 1880s was not characterised by liberty, it was characterised by state capture. Having the government in their pockets gave the robber barons the “freedom” to adulterate meat and pollute rivers, but just as much the “freedom” to send Pinkerton thugs – or Federal troops – to break heads when they didn’t get what they wanted. The heads, presumably, of people who had the freedom to get their heads broken. As always, what minarchists imagine is a system lacking state intervention is rather a system of state intervention on behalf of a privileged class. Or perhaps minarchists realise that but have no problem with it, as they only tend to object when the state intervenes to protect the other fellow.
Weaver (pseudonym), "More Libertarianism Thread (Crooked Timber) comment 23."

When men like that [ William F. Buckley, Jr. ] talk about "liberty", it's wise to watch your back if you don't happen to be a member of their club.
Digby, "Joe Scarborough skips the dirty parts"

I suspect most libertarians will respond that they can use coercion to protect their justly acquired property no matter what other reasonable people think. After all, libertarianism is true and statism is false. But that means that you, libertarian, are prepared to coerce your equal to do what you demand even though she has not agreed and will likely not agree were you to explain your reasoning to her. That is, you are prepared to subordinate your non-libertarian fellows to your will.
Kevin Vallier, "A Libertarian Rehabilitation of Hobbes"

What is wanting in many libertarian political theories is the recognition that property rights are coercive and so stand in need of justification to others.
Kevin Vallier, "On the Problematic Political Authority of Property Rights: How Huemer Proves Too Much"

Paul Ryan is an authentically dangerous zealot. He does not want to reform entitlements. He wants to eliminate them. He wants to eliminate them because he doesn't believe they are a legitimate function of government. He is a smiling, aw-shucks murderer of opportunity, a creator of dystopias in which he never will have to live. This now is an argument not over what kind of political commonwealth we will have, but rather whether or not we will have one at all, because Paul Ryan does not believe in the most primary institution of that commonwealth: our government. The first three words of the Preamble to the Constitution make a lie out of every speech he's ever given. He looks at the country and sees its government as something alien that is holding down the individual entrepreneurial genius of 200 million people, and not as their creation, and the vehicle through which that genius can be channelled for the general welfare.
Charles Pierce, "Paul Ryan: Murderer Of Opportunity, Political Coward, Candidate For Vice President Of The United States"

Williamson borrowed from Coase the concept of "transactions costs" the idea that the market price in any transaction may fail to incorporate the full costs to the seller or buyer because of the very conditions of exchange. In particular, whenever there is uncertainty or the need for long-term relationships, the parties to a transaction are unlikely to be able to write contracts complete enough to cover all the contingencies or hidden costs. Furthermore, incomplete contracts encourage one or the other party to behave opportunistically, deliberately withholding information or broadcasting disinformation to get a better deal. In such cases, the transaction is likely to occur under a single roof, inside a "hierarchy" (that is, firm). This solution "internalizes" or reveals to the decision makers those otherwise hidden costs. Williamson showed that there are, even in pure theory, situations in which the inefficiencies of bureaucratic organization are offset by the greater predictability of the outcome. This is showing quite a lot, at least to academic economists. It says that under rather common circumstances it is efficient (maximizing of profits, minimizing of long run average costs) for explicit rules, regulations, commands, organization charts, and social contracts to replace the invisible hand.
Bennett Harrison, "Where Private Investment Fails"

Hayek supported social insurance, even in The Road to Serfdom [...] He made clear that compulsory contributions to a system of social insurance were compatible with a free society. Hayek rejected laissez-faire capitalism and insisted that a free society was also compatible with various forms of economic regulation [...]
Elizabeth Anderson, "Thomas Paine’s “Agrarian Justice” and the Origins of Social Insurance"

"Agrarian Justice" forged a path to this modern, systemic understanding of justice. In it, Paine envisioned justice as requiring that the lowest rung be above poverty level. He recognized that achieving this required forging novel, positive (legal) forms of property rights--social insurance and stakeholder grants--that could not be deduced from local or "natural" principles of justice. He saw, if only partially, the limitations of market- and desert-based justifications of property rights that ignore social externalities. Most astonishingly, he stood at the cusp of a famous systemic principle of equality--a principle defining the limits of justified inequality. In the words of its most influential advocate, John Rawls, "social and economic inequalities are to be arranged so that they are . . . reasonably expected to be to everyone's advantage."
Elizabeth Anderson, "Thomas Paine’s “Agrarian Justice” and the Origins of Social Insurance"

Anarcho-capitalist, as far as I’m aware, have yet to answer exactly what a landowner is if not a de facto state. A state is defined over a particular territory, and (theoretically) has control over what happens in that territory. Ownership is also defined as having control over an object; in the case of land, this quite clearly leads to each land owner effectively being a sovereign state, however small. [...] any response that centered on how landowners would be competitively inclined to do Good Things could equally be applied to states, so would be an exercise in special pleading.
UnlearningEcon, "An FAQ for Libertarians"

Saying ‘governments can’t create wealth’ is a sweeping, largely vacuous statement based on a superficial zero sum view of taxation as being ‘extracted’ from the private sector. In fact, taxation is just one prong of a symbiotic relationship that exists between the private and public sectors. If we take the definition of wealth as the creation of valuable resources, it’s clear that, say, teaching and infrastructure ‘create wealth.’ We’ve already seen just how large a source of wealth the government can be through its funding of research and development. Furthermore, many state-backed institutions are historically a prerequisite for substantial wealth creation to take place at all.
UnlearningEcon, "An FAQ for Libertarians"

[...] public choice theory is simply refuted by the evidence, something that people do not note nearly often enough. Political scientists have known – and empirically confirmed – that voters and politicians mostly act in what they perceive to be the public interest, rather than for selfish gains. This isn’t to say that there is no truth to public choice theory, but evidence suggests it is more appropriate to model politicians and voters as public servants who are buffeted by special interest than as selfish maximisers who occasionally stumble upon a beneficial policy. The result is that democracy is far more effective a tool for translating collective interests into policy than libertarians might suggest.
UnlearningEcon, "An FAQ for Libertarians"

Nozick suggests that if everybody at a basketball game volunteered to pay Wilt Chamberlain a small amount of money, the end result would be a vastly unequal income distribution, but since everybody had donated ‘voluntarily,’ there would be no problem regarding the justness of the outcome. But while it is true that everybody at the basketball volunteered to donate their own money, it is not true that they agreed to anyone else donating money, and it is certainly not true that they all agreed to everyone collectively donating a fortune. The principle is actually based on a subtle switch from individually voluntary choices to collectively voluntary ones, one which doesn’t hold up to scrutiny.
UnlearningEcon, "An FAQ for Libertarians"

It seems to me that there are five areas in which government spending has a demonstrated superiority over the private sector -- health and disability insurance, education, old-age pensions, infrastructure spending, and military spending. It seemed to me that structural changes in our economy and society were driving the amount of money we ought to spend in sum on those five up, hence the enlargement of government.
Brad DeLong, "Nick Eberstadt and the "Takers" Once Again: More Reflections on the General Theory of the Moocher Class"

Well what’s called libertarian in the United States, which is a special U. S. phenomenon, it doesn’t really exist anywhere else -- a little bit in England -- permits a very high level of authority and domination but in the hands of private power: so private power should be unleashed to do whatever it likes. The assumption is that by some kind of magic, concentrated private power will lead to a more free and just society. [...] that kind of libertarianism, in my view, in the current world, is just a call for some of the worst kinds of tyranny, namely unaccountable private tyranny.
Noam Chomsky, "The Kind of Anarchism I Believe in, and What's Wrong with Libertarians"

Well one of the main problems for students today -- a huge problem -- is sky-rocketing tuitions. Why do we have tuitions that are completely out-of-line with other countries, even with our own history? In the 1950s the United States was a much poorer country than it is today, and yet higher education was … pretty much free, or low fees or no fees for huge numbers of people. There hasn’t been an economic change that’s made it necessary, now, to have very high tuitions, far more than when we were a poor country. And to drive the point home even more clearly, if we look just across the borders, Mexico is a poor country yet has a good educational system with free tuition. There was an effort by the Mexican state to raise tuition, maybe some 15 years ago or so, and there was a national student strike which had a lot of popular support, and the government backed down. Now that’s just happened recently in Quebec, on our other border. Go across the ocean: Germany is a rich country. Free tuition. Finland has the highest-ranked education system in the world. Free … virtually free. So I don’t think you can give an argument that there are economic necessities behind the incredibly high increase in tuition. I think these are social and economic decisions made by the people who set policy. And [these hikes] are part of, in my view, part of a backlash that developed in the 1970s against the liberatory tendencies of the 1960s. Students became much freer, more open, they were pressing for opposition to the war, for civil rights, women’s rights … and the country just got too free. In fact, liberal intellectuals condemned this, called it a “crisis of democracy:” we’ve got to have more moderation of democracy. They called, literally, for more commitment to indoctrination of the young, their phrase … we have to make sure that the institutions responsible for the indoctrination of the young do their work, so we don’t have all this freedom and independence. And many developments took place after that. I don’t think we have enough direct documentation to prove causal relations, but you can see what happened. One of the things that happened was controlling students -- in fact, controlling students for the rest of their lives, by simply trapping them in debt. That’s a very effective technique of control and indoctrination.
Noam Chomsky, "The Kind of Anarchism I Believe in, and What's Wrong with Libertarians"

The purpose of studying economics is not to acquire a set of ready-made answers to economic questions, but to learn how to avoid being deceived by economists.
Joan Robinson

To be enslaved to the impersonal forces of the market is, in the final analysis, just as inhumane as being enslaved by the state or the party. Chains are chains and the Austrians and their American followers are not preaching authentic human freedom but its counterfeit.
Michael Sean Winters, "Review: Angus Sibley's "The 'Poisoned Spring' of Economic Libertarianism"

As we know from history, the free market did not lead to a breakdown of segregation. Indeed, it got much worse, not just because it was enforced by law but because it was mandated by self-reinforcing societal pressure. Any store owner in the South who chose to serve blacks would certainly have lost far more business among whites than he gained. There is no reason to believe that this system wouldn't have perpetuated itself absent outside pressure for change. In short, the libertarian philosophy of Rand Paul and the Supreme Court of the 1880s and 1890s gave us almost 100 years of segregation, white supremacy, lynchings, chain gangs, the KKK, and discrimination of African Americans for no other reason except their skin color. The gains made by the former slaves in the years after the Civil War were completely reversed once the Supreme Court effectively prevented the federal government from protecting them. Thus we have a perfect test of the libertarian philosophy and an indisputable conclusion: it didn't work. Freedom did not lead to a decline in racism; it only got worse.
Bruce Bartlett, "Rand Paul is No Barry Goldwater on Civil Rights"

It is really quite rare to find a buyer’s market for rented accommodation. Even if there is a slight oversupply of rental units for sale, time is almost always on the landlord’s side, because waiting is typically much more inconvenient for the party that has to wait without a house to do wait in. In general, when tenants and landlords are negotiating over the potential Pareto gain that could be made from renting the house, the landlord ends up capturing most or all of the surplus. The hot water and habitability laws are simply aimed at skewing things a bit in favour of the tenant and putting a floor on how bad a deal the tenant can end up accepting. It’s a standard game theory result that something which reduces your options can benefit you by reducing the number of bad options that you can end up agreeing to (most famously, the secret ballot has to be compulsory, because if you had the option to reveal your vote, you could be intimidated), and habitability laws are there for exactly this purpose.
Daniel Davies, "The correct way to argue with Milton Friedman"

I don't understand. How did this unregulated, imaginary currency invented by an anonymous hacker and backed by the full faith and credit of YouTube comments ever go wrong?
Stephen Colbert on Bitcoin, "The Colbert Report" 4/17/2013

The market economy or capitalism, as it is usually called, and the socialist economy preclude one another. There is no mixture of the two systems possible or thinkable; there is no such thing as a mixed economy, a system that would be in part capitalistic and in part socialist.
Ludwig von Mises, "Human Action" p. 259

Both Misesians and Hayekians live in a fantasy world, with respect to the price system. Both are dependent on the notion of universally flexible prices created by the dynamics of supply and demand curves, tending towards their market-clearing values. Both have failed to grasp the widespread reality and significance of fixprice markets and price administration.
Lord Keynes (pseudonym), "Mises and Hayek Dehomogenized?: A Note on a Schism in Modern Austrian Economics"

Large-scale government social-insurance programs are the best way we have found to achieve major and important public purposes. There has never been a private marketplace offering unemployment insurance. The unemployment insurance program works quite well: It gets money to people who have previously paid for it when they need it. Edward Filene’s welfare-capitalist notion that defined-benefit pensions offered by employers and more recent hopes that defined-contribution 401(k)s could provide old-age pensions more efficiently and effectively than Social Security have not covered themselves with glory over the past generation: Too many defined-benefit private pensions have not been paid out in full as promised, and too much wealth invested in 401(k)s has been skimmed off to enrich the princes of Wall Street. In health care, despite extraordinary administrative inefficiencies and little ability to improve quality and cost-effectiveness, the private insurance marketplace works—unless you are old, sick (and happen to be out of a job), or poor. Yet it is the old, the sick, and the poor who need health insurance most—hence, Medicare and Medicaid.
Brad DeLong, "Shrugging off Atlas"

And deserts—the fact that some people deserve what they have and others do not? That idea never made any sense to Adam Smith, for he saw that the overwhelming bulk of our wealth is our joint product through our collective division of labor, rather than the individual creation of some Randite John Galt, who if truly left to stand alone on his own two feet without the social division of labor would soon have his bones bleaching in some Colorado canyon.
Brad DeLong, "Shrugging off Atlas"