Grad students . . .

D'oh!

http://www.youtube.com/watch?v=XViCOAu6UC0

New google thing

Can someone explain to me what this new google "Ngram" thing is all about?  Real quick explanation, dumbed down to my 2nd grade level understanding of technology would be much appreciated.  Thanks.

Dworkin's website

As I mentioned earlier, Ronald Dworkin's new book was recently released.  In the Preface, he mentions that he will have a website responding to critical assessments of his work.  Although not yet in the full swing of things, here is the website:

http://www.justiceforhedgehogs.net/

I am extremely curious to see how this plays out.  You don't often have the opportunity to see a world-renowned philosopher engage in an on-going discussion with his critics.  Should be great.

In Which Ron Paul Is Awesome

Ron Paul is not perfect. He does not advocate a complete abolition of the State. He, however, understands why the Fed is criminal and immoral.

In Which Austrians Prove to Understand Economics Better than Keynesians

The esteemed Walter Block has compiled a bibliography, of sorts, of Austrian school economists/followers who predicted the blowing of the gigantic housing bubble that occurred in the USA thanks to the Fed keeping interests rates artificially low.

http://www.lewrockwell.com/blog/lewrw/archives/73123.html#more-73123

All the while, Keynesians the world over (looking at you Bernanke!) swore housing was not in a bubble.

End the Fed; Abolish the government

Re Re Ostriches Revisited

Danger,

First, I have not decided where I come out on dirty hands.  I am leaning towards condemnation, but it is a very tricky situation.  Second, I think you should assume in the example that we are in an anarchist political community where everyone legitimately consented to political institutions and unanimously decided upon democratic decision-making procedures.   Third, I think there is a gap in your analysis, for you failed to mention the context in which the choice is presented.  There is a second candidate who will win based on either a lie or a false belief, perhaps negligently false.  So Candidate A is presented with a dilemma: either (1) tell the truth, but lose the election because Candidate B was willing to pander to irrationalities, or (2) lie, win the election and implement policies you truly believe will help the economy. 

To better illustrate the dilemma, I will take the classic dirty hands example from Walzer.

We are now out of your ideal anarchist state.  Assume you are a citizen in a country with particularly corrupt electoral practices (hard to imagine, I know). Big Business and Big Union pours illegal money into campaign finance in exchange for post-election benefits.  Candidate A is an honest man and enters the arena with the promise to clean up the political scene.  Soon after starting his campaign, he learns that, in order to win the election, he must make a deal with a corrupt union boss, which involves the granting of government contracts to pro-union corporations.  Candidate A’s first instinct is: I can’t accept this offer.  But he is told by his experienced campaign advisors that if you refuse, the money will go to Candidate B, a dishonest man, and we will have no evidence to prove what is going on.  Worse, no one will believe us and the electorate will believe we are engaging in a smear campaign.  So Candidate B will win the election and you will lose. You will never be in a position to start cleaning up the electoral process.  So A’s choices are (1) reject the deal, and allow B to win and to continue the corrupt practices, or (2) accept the deal, gaining the chance to win.  Is Candidate A permitted to take option (2)? 

Re Ostriches Revisited

Ahh Hume, Hume, Hume.

Hume’s question implicitly brings to light two of my most hated mindsets – “the ends justify the means” and paternalism (i.e. “I know what’s best for you, moreso than you know what’s best for you).

Hume’s proposed course of action for Candidate A is fraud. That is, Candidate A is intentionally telling a lie, which lie will cause an individual to act in a way that he otherwise would not and the ultimate effect will be harm to that individual. He votes for “A” believing that “A” will increase entitlement programs and cut taxes. If “A” wins and then increases taxes and cuts entitlements, the individual has been fraudulently tricked into voting for someone who does not represent what that individual actually wanted.

Now, democracy is no less slavery than a fascist, totalitarian State. Rather than an autocratic ruler of one, an autocratic ruler of 50%+1 exists (and this is ignoring how modern democracy actually functions) and those in the minority have no option but to live under the tyranny of the majority.

But, I will not fight the hypothetical (even though “A’s” economic plan is ludicrously ridiculous!). Given the set up of a democracy, perhaps one would consider his right to vote to be analogous to a property right? It’s a tough sell, I think, but voting rights are central to democratic theory. In any event, “A’s” lies cause a voter to vote in such a way that he otherwise would not if the truth was known. As such, the voter’s rights have been violated.

Ugh, these hypotheticals are so difficult for me to answer.

Ostriches revisited

Danger began a back-and-forth by asking "how on earth can a politician telling the truth be a bad thing?"  I posed a question for danger and he responded.  I now have a follow up question for Danger and/or Gus:

Candidate A, an honest politician (oxymoron?), runs for president against Candidate B.  The economy is in bad shape (surprise!): the budgetary deficit is 15 per cent of the GDP, unemployment is rising, inflation is out of control.  It is A’s considered view that stabilization requires drastic cuts in the expenditures and tax rises.  Assume that this is backed up by the best available economic theory (don’t fight the hypo!).  B makes promises to expand welfare provisions and cut taxes.  A’s choices are (1) tell the truth, lose the election, and allow disaster to come, or (2) outbid B with ridiculous promises, win the election, and proceed to renege on his false promises and stabilize the economy.  Is A permitted to take choice (2)?  This is a classic example of “the problem of dirty hands.”

In Which I Describe What Is To Come

Very busy with real life work ... I hope to post a detail response to Hume's question (see below) in the coming days.

Jeremy Waldron and Gus

The more and more that I read Jeremy Waldron, the more I realize that Gus would find his political philosophy extremely appealing.

TSA screening

This is funny over at Concurring Opinions

Question for Danger

Danger,

When Austrians discuss the perverse effects of the Fed, they often refer to how it distorts information and market transactions, with the assumption that these distortions are negative consequences from an economic point of view.  With respect to other governmental interventionism, they often point to the Hayekian argument regarding the use of knowledge in society, the ability of individuals to make better use of their contextual knowledge than central planners ever could, etc.  They point to the destabilizing effects of frequent and unpredictable governmental involvement, and how this affects the ability of individuals to develop life plans, which affects investment decisions.  My question is this: if the ability to act on local knowledge and plan for the future is central for the maintenance of an orderly economic system, how does an anarchist political philosophy fit into the story?  I am not equating Austrian economics with political anarchism.  They are two independent theories in independent disciplines.  But you are an anarchist with Austrian beliefs.  What assumptions does the Austrian/anarcho economic model make?  What does this model look like?  I am especially interested to see the assumptions regarding stability and predictability in market transactions.  What are the systemic effects of a free market in law and protection?  What kind of plans are individuals able to make? 

I am not familiar with Carson’s work, so maybe he has answered these questions.  But I think they are important and this is an issue I have raised in the past, something I am not comfortable with.  I have not seen a convincing anarchist argument regarding the fact of reasonable disagreement in a pluralist society.  In other words, even if everyone was an angel and always acted on their good-faith belief about the natural rights and obligations of their fellow man, there would still be considerable disagreement about the content of those rights and obligations, the boundaries they set forth, and whether or not these boundaries have been violated.

In Which I Add Perspective

Andrew Sullivan writes:

Anthony Fowler and Ryan D. Enos asked Americans to pretend they could buy a congressional seat for their preferred party:

In a recent YouGov survey, we gave respondents a hypothetical scenario. “Suppose that you alone could determine whether a Democrat or a Republican represents your Congressional district by paying a specific dollar amount? How much would you be willing to pay to ensure that a Congressman from your preferred party will win the office?” We expected that most Americans would place a high value on the party of their Congressmen. Shockingly, 55% of respondents said “ZERO” -- they would not pay even $1 to place their preferred party in power.

The lesson they draw:

[W]e have little evidence that Americans care about politics. They often say that they are interested in politics but they won’t put their money where the mouth is – even hypothetical money.

The second paragraph doesn't follow first. One can care deeply about politics and still be unwilling to pay for an electoral outcome on the grounds that it would undermine democracy.

I will offer another perspective - I would be unwilling to pay any amount because I view the illegitimate attempt by the State to coercible usurp power over me as immoral and in violation of my natural right of liberty and, derivatively, self-determination and self-governance. It matters not to me whether a criminal claims affiliation with the democons or the republicrats.

As always - End the Fed, Abolish the government

Too early?

Nah, I've waited well over a decade for this

First District Court to Rule Health Care Law Unconstitutional

Two other Courts (Detroit, MI, Lynchburg, VA) have upheld the federal law.

http://www.nytimes.com/2010/12/14/health/policy/14health.html?_r=1&partner=rss&emc=rss

200 years of health and wealth

This is a really interesting video http://www.youtube.com/watch?v=jbkSRLYSojo&feature=player_embedded.

New releases

Two new releases arrived this week that are of importance to the legal philosophy field and moral/political philosophy in general.  First, Ronald Dworkin's Justice for Hedgehogs has finally hit the public.  I was able to read bits and pieces through manuscripts available via his NYU Colloquium, but I am eager to read it in its entirety.  This is more universal in scope, setting forth Dworkin's general theory of value, touching on everything from meta-ethics, to equality, to political and legal philosophy.  Second, Scott Shapiro's Legality finally arrived.  I am excited to read this, for his work has inspired much of my current interests in analytic legal philosophy (although more of a reaction than an inspiration).  Unfortunately, I am really busy over the next few weeks, so I won't be able to sink my teeth into these for a little while.  Nevertheless, I am still excited to get after it soon enough.

Update:  Larry Solum on Legality:

I've read multiple versions of several chapters, an earlier version of almost the whole book, and most recently the uncorrected page proofs. I feel confident that Legality is one of the very best books in general jurisprudence in many many years; it will certainly be on my list of ten selections from the Legal Theory Bookworm from 2010.  I suspect that Legality will be become a standard work for students of law and philosophy.  It is both deep and clear.

Everyone who engages in the academic study of law should read Legality--it is that important.  Buy it and read it!

Greenwald on WikiLeaks

Well put by Greenwald:

To recap “Obama justice”:  if you create an illegal worldwide torture regime, illegally spy on Americans without warrants, abduct people with no legal authority, or invade and destroy another country based on false claims, then you are fully protected.  But if you expose any of the evils secretly perpetrated as part of those lawless actions — by publishing the truth about what was done — then you are an Evil Criminal who deserves the harshest possible prosecution.

Confirmation hearings and judicial perjury

A well-known legal philosopher made the following comment to me a few times over the last few months (paraphrasing a bit):

“According to almost everyone, every legal philosopher, law professor, and judge, it is impossible to reach a decision in all cases without referring back to your own personal morality and political morality.”

This does not mean that it is impossible to decide what the law is without referring to your own morality.  There is great disagreement about that (that is the schism between positivists and non-positivists / Dworkinians).  Rather, the point is that all legal rules are universal and general, many with vague language and/or (possibly) indeterminate language.  There are “hard cases” that come before judges.  On the positivist account, there are “gaps” in the law, and the judge most fill in these gaps by assuming a legislative-type role.  This is judicial discretion.  According to Raz, a judge has a duty to fill in these gaps in the best possible way.  Dworkin, on the other hand, claims that these hard cases do not represent gaps in the law, they are just hard cases, where a judge must do what she always does: engage in an interpretive enterprise.  The judge must select the rule that best “fits” the prevailing legal landscape and provides the “best justification” for the law.  On his account, whatever rule that satisfies this two-part interpretive test actually is the law.

Leaving this debate aside, what interests me is the fact that both the positivists and non-positivists agree on what a judge must do: refer back to their own beliefs moral/political beliefs.  What is interesting is that every potential federal judge and potential Supreme Court justice says exactly the opposite in their confirmation hearings.  “The judge’s job is to apply the law.  The judge is not to consult her own personal morality.”  What are we to make of this?  Barry Bonds and Roger Clemens, as well as countless others, are prosecuted for lying to authorities, Roger Clemens specifically for lying to a Congressional committee.  Why do judges get a free pass?  This is especially interesting considering the existence of demanding legal and judicial ethical codes that require truthfulness in court, etc.  What gives?

Ouch

Rough game last night, Gus.  I still believe Dirty is going to be a solid quarterback . . .

Unfree Market

"To say the latest financial debacle has roots in the free market is simply to confuse the competitive market economy with the corporate state, the competition-inhibiting partnership between influential businesses and government officials. Implicit taxpayer-backed guarantees to creditors, government-sponsored enterprises such as Fannie Mae and Freddie Mac, deposit insurance that anesthetizes depositor wariness, Fed-organized bank cartelization — none of this has anything to do with the free market." -- Sheldon Richman

Amen brother. This brief excerpt, however, does not mention another glaring and enormous problem - the lack of a free market for currency.

A free market does not exist in America. People blame the "free market" for inequity and crises, but what ought to be blamed for the problems people note is the lack of a free market; the lack of competition and failure; the lack of opportunity.

Being the eternal optimist that I am, perhaps one day a free market will exist.

No Words to Describe My Excitement

WOW

Who Wants to Work for Bizzaro Robin Hood?

In response to my post regarding the wage and benefit discrepancies between public and private workers, Hume asks “Does this mean there is greater incentive for the more qualified to pursue ‘public’ work?”

At first blush, the obvious answer seems to be “yes”. Upon closer inspection, however, I’m not sure “yes” is absolutely correct.

Many other factors need to be considered beyond average wage and benefit compensation, including, the “risk/reward” scenario (perhaps less risk of losing a public sector job, although that’s debatable, versus the potential gigantic reward of entrepreneurial endeavor in the private sector) and a desire to not work in a bureaucratic environment.

I think the incentives are viewed differently by different individuals. I will say, though, the greater average total compensation package certainly does not act as a deterrent to public sector work for those not otherwise predisposed against it.

Follow up to Robin the Hood

"By comparison, the private worker earned $50,462 in pay and $10,589 in benefits, meaning that federal workers earn about half more in pay but four times as much in benefits, the BEA says."

Does this mean there is greater incentive for the more qualified to pursue "public" work?

Ethical Code of Hobos

An ethical code was created by Tourist Union #63 during its 1889 National Hobo Convention in St. Louis Missouri. This code was voted upon as a concrete set of laws to govern the Nation-wide Hobo Body; it reads this way:

1. Decide your own life, don't let another person run or rule you.
2. When in town, always respect the local law and officials, and try to be a gentleman at all times.
3. Don't take advantage of someone who is in a vulnerable situation, locals or other hobos.
4. Always try to find work, even if temporary, and always seek out jobs nobody wants. By doing so you not only help a business along, but ensure employment should you return to that town again.
5. When no employment is available, make your own work by using your added talents at crafts.
6. Do not allow yourself to become a stupid drunk and set a bad example for locals' treatment of other hobos.
7. When jungling in town, respect handouts, do not wear them out, another hobo will be coming along who will need them as bad, if not worse than you.
8. Always respect nature, do not leave garbage where you are jungling.
9. If in a community jungle, always pitch in and help.
10. Try to stay clean, and boil up wherever possible.
11. When traveling, ride your train respectfully, take no personal chances, cause no problems with the operating crew or host railroad, act like an extra crew member.
12. Do not cause problems in a train yard, another hobo will be coming along who will need passage through that yard.
13. Do not allow other hobos to molest children, expose all molesters to authorities, they are the worst garbage to infest any society.
14. Help all runaway children, and try to induce them to return home.
15. Help your fellow hobos whenever and wherever needed, you may need their help someday.
16. If present at a hobo court and you have testimony, give it. Whether for or against the accused, your voice counts!

The State Makes a Terrible Robin Hood

"Full-time federal employees earned an average of $81,258 in pay last year and $41,791 in benefits, the Bureau of Economic Analysis (BEA) reports.

By comparison, the private worker earned $50,462 in pay and $10,589 in benefits, meaning that federal workers earn about half more in pay but four times as much in benefits, the BEA says."

h/t Robert Wenzel, www.economicpolicyjournal.com

Judging Wikileaks

I really enjoy Judge Andrew Napolitano as he is one of the very few sane voices on television.



I disagree with his starting point of constitutionality. I don't believe that a document agreed upon by alleged representatives of states should have been binding upon individuals 200+ years ago and I believe it even more ridiculous to claim a document that old could possibly be binding upon individuals today. I never consented to it, neither tacitly or expressly, and I am outright disclaiming its jurisdiction over me today (for the 100,000,000,000th time).

Regardless, still worth the few minutes to watch.

Equality and libertarianism

Libertarian political philosophy is often criticized for not taking equality seriously as an important political value.  Is this charge legitimate?  Do libertarians reject the idea of equality as such?  Do they reject the idea that “everyone is equal”?

To understand the controversies regarding equality, one must first understand the nature of equality as a political ideal.  An important and fundamental distinction to understand (made by Ronald Dworkin) is between “treating an individual equally” and “treating an individual as an equal.”  Treating someone equally means acting in such a way that affects their position along a particular dimension equally (e.g., to the same distribution of goods or opportunities).  Treating someone as an equal requires treating them with “equal concern and respect.”  Treating someone with “concern” is to treat them “as human beings who are capable of suffering and frustration.”  Treating someone with “respect” is to treat them “as human beings who are capable of forming and acting on intelligent conceptions of how their lives should be lived.”

Treating individuals “as equals” is a higher-order principle than treating them “equally.”  This is because treating equally requires equal treatment along some dimension.  But treatment can always be compared along multiple dimensions.  One need only to look to the familiar political slogans regarding economic distribution to see how this is so: (1) ‘To each according to his needs’; (2) ‘To each according to his efforts’; or (3) ‘To each according to his contribution.’  Thus, need, effort, and contribution all act as possible dimensions along which one can be “treated equally” vis-à-vis economic distribution.  In the typical case, these principles cannot be satisfied at the same time.  Thus, there is a need for a higher-order principle, a principle to decide which first-order distributive principle is to govern economic distribution.  This is where treating someone “as an equal” comes in, it selects which first-order principle is to carry the day.

The problem of equality is to be found when one attempts to apply the second-order principle of treatment “as equals” (equal concern and respect) to competing first-order distributive principles (e.g., “to each according to his need” vs. “to each according to his contribution”) in order to select which is the morally correct first-order principle.  In order to decide specific and controversial issues, the “treatment as equals” needs interpretation.  But in order to do this, mid-level or “mediating” principles are required, and the more specific the issues are, the more controversial the mediating principles will be.

Thus, there is a problem of interpretation of treatment “as equals” (let’s call this second-order principle the “equal consideration principle”).  Thomas Nagel offers an illuminating way to understand the situation.  Interpretation of the equal consideration principle can be understood in the following way: equal consideration provides individuals with a “veto.”  If a policy or procedure fails to treat him with equal consideration, he is justified in rejecting it, and his non-acceptance is a reason for doubting its legitimacy.  The issue, the problem of equality, is where to place the veto, and different mediating principles differ in where they claim the veto properly belongs.

For example, a utilitarian mediating principle places the veto at the input stage.  There is a moral requirement to maximize the good overall, and the egalitarian aspect requires that every individual’s interests be taken into account, everyone is given equal weight (my interests are given the same weight as Michael Jordan’s interests, his interests do not count more just because he is Michael Jordan).  Notice that equality is not taken into account at the output stage: an output of the decision-procedure is legitimate, no matter how unequal the distribution, so long as everyone’s interests were taken into account and given equal weight, and as long as the decision maximizes the good overall.

This finally brings us back to the questions regarding libertarianism.  As now should be clear, libertarians do in fact take equality seriously.  Treating someone with “equal concern and respect” is a central feature of libertarian thought.  The differences between libertarianism and other egalitarian conceptions of equality are caused by the differing mediating principles and where they claim the veto should be placed.  Most libertarians believe in a strong conception of individual rights (Robert Nozick famously opens Anarchy, State, and Utopia by declaring that “[i]ndividuals have rights, and there are things no person or group may do to them (without violating their rights)”).  Thus, libertarians believe that every individual has a veto against an invasion of their rights.  One is not treated with “equal concern and respect” if a procedure or policy violates that person’s rights (without acquiring consent).  As Nagel describes the position, “[t]he moral equality of persons . . . is their equal claim against each other not to be interfered with in specified ways.  Each person must be treated equally in certain definite respects by each other person.”  As a result, it is incorrect to charge libertarians with failing to consider equality.  It is, of course, entirely legitimate to disagree with the mediating principles and the resultant placement of the veto, but in order to avoid begging the question, one must first acknowledge equality as a genuine concern in libertarian thought.

The State vs. a "Band of Thugs"

Danger asks:

“please describe the difference between the State and the Mafia. Both force you to pay them for protection and other services you do not necessarily want or even need. Both threaten you with bodily or grave harm if you do not comply. Both profit greatly from such actions.”

Most political theorists and social scientists describe the difference like this.  The state, as opposed to a “band of thugs,” claims moral authority, that is, that they have a morally legitimate right to do what they do, that they are morally justified in their actions.  They may be wrong and they may be insincere, but that is the salient fact that distinguishes the two situations.  The mafia never makes such pretensions, it simply does what it does and says “what are ya gonna do about it?!”  The state, on the other hands, claims moral legitimacy.  Whether this is a significant fact (morally or practically) between the two is, of course, open to debate.

Update:  Also, many theorists note that some sort of legal system is an additional distinguishing feature between the State and a band of thugs.  The modern state governs through an institutional system made up of rules ('laws'), as opposed to informal decrees and random acts of violence. 

Hero

Long live Julian Assange. That is all.

Reasonable Discussion - Ostriches

Hume responded to my post "Ostriches" in the comments, writing, in part,

"How on earth can a politician telling the truth be a bad thing?"

This got me thinking: should we assess this statement from the standpoint of institutional design or from the standpoint of pragmatic administration? In other words, should we assess the truthfulness of politicians with an eye towards systematic consequences or on a case-by-case basis? I can easily think of hypothetical situations where it is a "good" thing for politicians to fudge the truth (e.g., probabilistic chance that awful event X happens, and the only possibility of preventing event X is if the general population remains calm and orderly).

Let me start by stating that I am an anarchist. This means different things to different people, but to me it means I am anti-State, anti-War, and pro-Liberty. Being pro-Liberty means I believe people have the right to do as they please so long as they do not harm another, i.e. aggress against another. Incumbent in that is the fact that people have the right to retain the fruits of their labor, without it being stolen from them, and can use such “fruit” as they see fit (including trade it). The State is inherently evil as its entire existence is predicated upon theft and coercion. The State exists because it illegitimately claims authority and jurisdiction over individuals on the sole basis of their residence within an imaginary set of lines. The State sustains itself through taxation, which is nothing more than the theft of privately created wealth. The State erects artificial barriers to entry in market places and, contrary to popular belief, creates far more poverty than would otherwise exist. This really deserves its own post, indeed its own multi-volume anthology.

Back to Hume’s comment. “[S]hould we assess this statement from the standpoint of institutional design or from the standpoint of pragmatic administration.” As so often happens, I feel I cannot really respond to this statement. The underlying premise, to me, is flawed. The “institutional design” is a function of the coercive acts of the State. The institutional design of democracy is premised upon individuals electing representatives to reflect/protect/advance their specific interests against the interests of other individuals forced into a “society” with them.

I believe we can only assess the “rightness” or “wrongness” of any statement or action from the standpoint of “does it harm others? does it infringe upon the natural rights of others?” When a politician lies to the general public, it has an effect on markets. By markets I do not only mean equity, credit, commodity, etc markets that are talked about on CNBC and in the Wall Street Journal. By markets, I literally mean every single transaction that takes place between consenting individuals and entities. Such lies have the effect of distorting available information, which, in turn, has the effect of skewing the transaction away from what would otherwise be the natural reactions of markets. This necessarily harms people – decisions are made and actions taken based on information that is flawed due to the calculated lies told by a politician attempting to advance his own interests (which often happen to coincide with the interests of those occupying the power circles created in the first instance by the State).

This creates harm. Some one or some many ones will end up in a losing position because the markets generally were influenced by a conscious lie. At least some portion of those losers would have acted differently but for the flawed information.

I know this is likely dissatisfying, as it does not really address Hume’s comment. I, however, truly believe that it is foolish to attempt to analyze the pragmatism or practicality of political actions taken by State actors. The entire institution is criminal and ought to be destroyed.

To anyone shaking his or her head while believing me a lunatic – please describe the difference between the State and the Mafia. Both force you to pay them for protection and other services you do not necessarily want or even need. Both threaten you with bodily or grave harm if you do not comply. Both profit greatly from such actions. Geez, the only difference that I can discern is that I am not aware of the Mafia trying to dictate what one can ingest or on what goods one can spend his money (after the Mafia gets its cut, of course).

Thanksgiving football

As a Giants fan, I face a predicament on this day of gluttony and football: do I pull for the Saints or the hated Cowboys?  We will (hopefully) be competing for a Wild Card spot and the Saints will be right there battling us, so we need the Saints to lose.  But it's the Cowboys.  How can I (or any self-respecting non-Texan) ever root for the Cowboys?  Pretty tough spot here, although not nearly as bad as the nightmare that was the Phillies-Yankees World Series (I am a Mets fan).  Danger, what do I do??

Ostriches

Last night while driving home from work, observing the lovely scenery from a standstill position on the BQE, I was listening to Bloomberg Radio, specifically a replay of “Bloomberg on the Economy,” which was originally broadcasted earlier in the day. The host, Sarah Eisen, was discussing the debacle that is the state of EU finance and the Euro itself with a guest, who was the top economist from a major investment firm.

Eisen began by referencing a statement German Chancellor Angela Merkel made earlier in the day, which was something to the effect of “The Euro is in an exceptionally serious situation,” due to the crushing debt:GDP ratios of EU countries and the bond markets realization that, hey!, this could be more problematic than we previously thought. Eisen then asked the guest, “What was she [Merkel] thinking in saying that?!!,” implying that the bond and currency markets reactions would be harmful. Several thoughts immediately popped into my head, only one of which is discussed below:

How on earth can a politician telling the truth be a bad thing? One need not be a long time economic analyst or expert on EU financing to understand the entirely unsustainable debt load the member States are facing. Yes, the specifics of the problems facing each country are somewhat different, i.e. Ireland’s is the result of the government’s guaranteeing of horrific bank loans, whereas Greece’s stem more from impossible entitlement programs and public sector contracts. The main thrust, however, is the same for all – bondholders realize that these States’ debt repayment abilities are more or less non-existent.

The only thing I could infer from Eisen’s comment was that she somehow believes that if politicians, central bankers, etc. simply lie about the true state in which the EU and its member States find themselves, everything will end up bright eyes and blue skies. The ever-so en vogue “kick the can”/“extend and pretend”/“O.D. on hopium” meme that governments, banks and most of the mainstream media would have the (mostly) economically illiterate populous swallow as a panacea is nothing more than snake oil.

Eisen's inferred position is, of course, pure folly. The idea that one can simply stick his head in the sand and avoid problems by ignoring them is so ridiculous that the average 6 year old has little trouble understanding the concept. Merkel’s comments are exactly the type that should be made. The most important function of markets is their ability to convey information, through pricing, in the fastest and most efficient manner known (and, indeed, possible). By lying, extending and pretending, and kicking the can, prices do not drop to where they must. This leads to poor decisions based on incorrect information. In a truly freed society, this resolves itself easily and of its own accord, as issues of sovereign debt would not exist. Sovereign debt is far different than any other type of debt, since other borrowers do not have the option of throwing millions of people in cages if they refuse to surrender money to the borrower. Additionally, other borrowers do not have the ability to counterfeit money to pay off these debts (although individual EU member States do not have this option either).

No, in a freed market, the only option for a borrower who cannot repay its debts is default and bankruptcy. In the current world in which we live, however, governments no longer default. They bailout banks and bondholders, they bailout member States, they steal through taxation, they counterfeit money by printing at will, with nothing of value behind it. These “solutions” are always at the tips of their fingers and, therefore, they always believe that if they can just have a little bit more time, the situation will resolve itself. “If we could just get people spending again!” … one is left with no savers, ergo no investors, ergo no way to create new businesses or expand current businesses, ergo no way to produce jobs, ergo no way to truly recover. Economies do not grow on hopes and dreams, they grow on investments made with the aid of free-flowing, unencumbered information.

But it’s OK – keep up the lies distorting the true economic reality. Keep perpetuating the biggest Ponzi scheme ever devised.

Retrospective increases in punishment

Suppose we adhere to some sort of retributive theory of punishment, that “the punishment should fit the crime.”  Suppose further that Eli is convicted of murder and sentenced to 15-20 years in prison, the maximum permissible under the sentencing guidelines at the time of the murder (based on a retributive judgment that 15-20 years is just).  Now suppose that officials in the system correctly realize that the principles of just punishment require a sentence of 25-30 years in prison (‘correctly’ being stipulated for the hypo).  Is it wrong for the system to alter Eli’s punishment, increasing it to fit the correct retributive calculation?  Is it unfair?  If so, why?  What values usually underlie our judgments condemning retroactive law-making?  Do they apply to cases of retrospective increases in punishment?

Hart and the rule of recognition

In the Concept of Law, H.L.A. Hart set forth his theory of the rule of recognition. An interesting aspect of this idea is that it attempts to solve a problem of legal validity/authority (the “chicken or egg” problem) by introducing an observable practice among officials and subjects as the foundation of all legal systems.  When one is confronted with a rule R claiming legal authority, a question arises: “what gives this rule R authority?”  A natural response (perhaps by an official demanding conformity to the rule) is to point to some other rule: “statute X confers authority on rule R.”  But again, one may ask “well, what gives statute X authority?”  This process could go on ad infinitum.  This is where Hart’s rule of recognition enters the picture: we eventually get to a point where the answer to the question “why is this rule (legally) authoritative?” is simply this: “it just is.” 

The “it just is” aspect of Hart’s rule of recognition is seen in its description: it is a practice among officials and subjects of locating criteria of validity, and it is manifested in the practice of identifying norms as rules of the system by applying such criteria.  It is further illustrated when Hart claims that the existence of the rule of recognition is a matter of external fact, not a matter of validity or invalidity.  He states “[n]o such question can arise as to the validity of the very rule of recognition which provides the criteria; it can neither be valid nor invalid but is simply accepted as appropriate for use in this way” (Hart at 109).  This is why the internal point of view is crucial to Hart’s theory.  The “it just is” answer is partially constituted by the fact that the substance of the ultimate rule is accepted (as manifested in practice) as a norm, thus providing the criteria applied by the officials of the system in identifying valid laws.  This practice/acceptance acts as a backstop to the perpetual question “well, what makes this rule (legally) authoritative?”  (I understand Hart as providing a descriptive account of law’s normativity, merely describing it in terms of people’s belief).

Thus, Hart provides an account aimed to ground legal validity in the practice and belief of legal officials.  This account of the grounds of law is, however, vulnerable to an important critique set forth by Ronald Dworkin in Law’s Empire.  Dworkin argues that Hart’s theory of the “grounds of law” cannot account for “theoretical disagreement” in law.  Theoretical disagreement, according to Dworkin, is disagreement about the ultimate criteria of legal validity, disagreement about the “grounds of law.”  He claims that such disagreement is prevalent in legal practice and legal academia. 

The strength of this argument is seen in its weakening of Hart’s account as illustrated above – the “it just is” aspect of the rule of recognition.  Essentially, Dworkin’s argument claims that there is no such agreement in the legal community: no one can honestly claim “it just is” in light of the theoretical disagreement about the grounds of law.  Thus, a positivist account of the grounds of law must be able to answer Dworkin’s critique, either by locating a place for theoretical disagreement within a positivist framework or denying its significance.  Brian Leiter has recently attempted such a project (Explaining Theoretical Disagreement, 76 U. Chi. L. Rev. 1215 (2009)) , but I will not review the argument here.

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