Economic links worth remembering

31 07 2009

Great links, that I will probably make use of in the future when arguing with lefties. 

Firstly, thanks to DanD commenting at the ALS blog for this illustrative tax calculator:  The labels, “bludger”, “burden”, “plunder” are quite humorous.

Secondly, Julie Novak and Sinclair Davidson’s recent IPA paper, “5 1/2 things Kevin Rudd doesn’t understand about the Australian economy”


Language and thought. Are you doing it right?

29 07 2009

Those interested in politics have probably heard of the term “framing”.  According to the Washington Post, framing means “constructing a schema of interpretation.”  In politics we often see these word games.  Obama’s catch phrase “a change we can believe in” is one of the most disgracefully meaningless uses of the English language ever invented which somehow managed to evoke feel good emotions in his supporters. 

 But framing is part of a wider problem with the way some think.  Words represent concepts.  And valid concepts can be ultimately reduced to percepts.  Therefore to be truly logical in your arguments, you must always keep in mind the context and connection to reality referd to by the words you use.  Rationalist philosophical rules of deductive logic do not cater for this important consideration and therefore errors are possible in deductive arguments.  As Ayn Rand said: “check your premises”.   

A closely related point of interest is Ayn Rand’s identification of the fault she termed a “floating abstraction” which I will define as, a concept that is used in a way which ignores the concept’s basis in reality. 

Recently Peikoff was asked an interesting question on one of his Pod Casts:  See
The questioner asked:
“Wouldn’t an altruist have to advocate capitalism given his ethics, because capitalism is actually what makes other people happy and that’s his professed goal” 
Peikoff identified this as a rationalistic question dropping context, ultimately becoming a word game. 
The argument can be summarized as:

Altruism = making people happy
Capitalism = making people happy
Therefore, altruism = capitalism.  

A deductively sound argument.  But a false argument nonetheless.  Why? Because one must examine what altruism and capitalism actually mean in reality. 
Capitalism involves working for ONESELF for profit, sucess, independance etc. 
Altruism means sacrificies for OTHERS for the sake of it.  ie: with no gain to oneself.  An altruist cannot endorse selfish activity without being hypocritical.  And capitalism necessarily invovles selfish activity. 
So when we connect these concepts back to what they mean in reality, we see the contradiction that was not evident in the rationalistic deductive argument. 

Incidentally, the above demonstrates that pure altruism is impossible and altruism is a logically contradictory system of ethics.  Objectivism argues that rational egoism does not have this logical fault. 

Over at Principled Perspectives, Mike Zemack gives us another example.  He identifies how dropping context from language by ignoring what the concepts (words) of a statement actually mean in reality, allows one to argue for false conclusions.  Look how Mike addresses the statement of a commentor on his blog – in the final sentence notice that Mike connects the concepts (words) back to the conditions of reality: 

“Should a person die because he/she can’t afford necessary treatment?”

Mike: “The question attempts to pass off an intellectual package deal. Implied is the collectivist notion that there exists some entity (i.e., society, the state, the community, etc.) that supercedes the sovereignty of the individuals who make up a nation, and that possesses the authority to answer the above question independent of the desires and rights of those individuals. In other words, what lies behind the question is the idea that an individual does not own his own life…i.e., the tribal premise.  
The questions that first must be addressed are: Where does the “necessary treatment” come from?; and how does one acquire it?”

My own recent observations of word game errors involved Rudd’s continual dismissal of capitalism and/or neo-liberalism as “extreme”.  There are obvious reasons why “extreme” doesn’t necessarily mean bad.  But politicians and the media have framed the word “extreme” to imply that extremism (generally in ideology) is harmful and impractical. 

If one accepts this obviously false premise then deductive logic can be used to justify just about anything. 
Simplified, Rudd’s argument can be summed up as follows: 

Extremism is bad
Capitalism is extreme
Therefore capitalism is bad. 

In the above case, there is absolutely no fault in deductive procedure here. 
If the premises of the argument are true the conclusion must be true.  However the premise “extremism is bad” is obviously not true.  
The concept “extreme” must be examined with reference to what it actually refers to in reality.  Rudd is erroneously assuming extremism is bad per se.  
Extreme according to means: “farthest removed from the average” or “utmost or exceedingly great in degree” 
Clearly it would not be a bad thing to be exceedingly great in degree of productivity or of good health or of personal happiness.  A cancer survivor may be farthest removed from the average.  Examples are endless.  But lets use an example of ideology (the way Rudd applies the concept extreme).  Is moderation in nazism, satanism or nihilism good?  Is an extreme rejection of nazism, satanism or nihilism bad? 

To say a thing is bad or doesn’t work because it is extreme is not an argument.  More explanation is required.  The argument must be linked to the real world and requires a demonstration of why too much of the issue in question is harmful.  To not do this is most likely lazy, dishonest or ignorant.  In Rudd’s case, I’d say arrogant.   

Unfortunately, in politics, false arguments work because most people have not learnt how to evaluate the validity of such statements.  The masses are being manipulated by word games.  Politicians are hiring experts on “framing” – because unfortuantely, it works.

Money the root of all evil?

29 07 2009

One of my favourite lines from Atlas Shrugged was when Francisco d’Anconia states:

“So you think that money is the root of all evil?” said Francisco d’Anconia. “Have you ever asked what is the root of money?”

The entire money speech is located as I have just discovered. 

EnviroNazis and the importance of essentials

27 07 2009

The other day I was talking to someone about economics and I stated that economic growth, including job creation depended on capital accumulation.  And that therefore society shouldn’t penalise creditors via inflationary policies.  The person I was talking to quickly answered that all the rich people they knew had borrowed heavily at various stages of their careers.  They used this observation to then state that debt was a good thing, period.  Therefore, in their minds, penalising creditors to serve debtors was a good thing. 
This person was evading the reality that you need capital in order to have the ability to borrow in the first place! 
Creditors are required first, before debtors can even exist.  The more people capable of accumulating savings and having the ability to lend, the better because this would allow for the possibility of more borrowing afterall. 

So while, the main fault for this person was a drop of context, the conversation led me to the interesting observation that, in a certain sense, credit is more fundamental than debt.  Because without the ability to provide credit, debt is impossible. 

In the science of economics, we can identify capital accumlation as being an essential for economic growth. 

All sciences involve heirachies of knoweldge.  Digging deeper down to find the fundamentals of reality, the essentials. 

Climate science is no different and essentials must be identified.  As the reader probably knows, AGW sceptics, often point to the fact that historically temp rises preceed CO2.  ie: increasing temp drives increasing CO2 conc and therefore CO2 is not the fundamental.   It’s true that a feedback mechanism may occur, but temp is still the fundamental.  ie: Temp rises, then CO2 rises, which may then drive temp further, which then drives CO2 etc. 
A good example of a feedback mechanism would be credit and debt in economics.  As debt levels rise, more incentive to provide credit results. 

But what happens if you do not identify the fundamental? 

Answer: all sorts of craziness. 

The following article is IMO a great example (albeit a spoof) of what can happen if you reverse cause and effect.  Thanks to Michael Sutcliffe for posting this link at the ALS.  Did you know, our climate woes are due to the sudden halt in Aztec human sacrifice? 

Did climate drive the sacrifices?  Or did the sacrifices drive climate?  Which was the fundamental?

Un-examined consequences of banning plasic bags

24 07 2009

Funny story I heard today about shop lifting rates increasing in Adelaide aided by the ridiculous ban on plastic bags in South Australia (which achieves absolutely nothing of real value – it simply makes life harder for all, wastes the money of the innocent and allows some idiot politician temporarily evade the fact that he’s useless and harmful to humanity)

Via Wikipedia: “The increased use of reusable bags has led to an increase in shoplifting as they provide a way to conceal pilfered items. After a plastic shopping bag tax was passed in Ireland and shoppers transitioned to reusable bags stores reported a correlating increase in shoplifting. [8]


“Professional thieves using green bags to conceal theft”:,22606,25020990-2682,00.html?from=public_rss

Checkout staff in bag ban safety plea:,22606,25384878-5006301,00.html

And shoplifting isn’t the only problem.  Obviously there is the extra cost to consumers and supermarkets. 
But did you think of this?
Most reuable bags shoppers don’t wash their bags once they return home and the bags may be leading to food poisoning according to Dr. Richard Summerbell, research director at Toronto-based Sporometrics and former chief of medical mycology for the Ontario Ministry of Health. [6]. Because of their repeated exposure to raw meats and vegetable there is an increased risk of food born illness. A 2008 study of bags showed mold and bacterial levels in reusable bags 300% greater than those considered safe. [7]

John Allison. The Financial Crises: Causes and Possible Cures

24 07 2009

The media, politicians, and even many businessmen have blamed today’s financial meltdown on capitalism. But in this talk, John Allison—the longest-tenured CEO of a top-25 financial services company’argues that this crisis is a legacy of the government’s anti-capitalist policies.

Mr. Allison presents his unique perspective of the financial services industry to support his argument that massive government intervention into the U.S. economy—from the creation of the Federal Reserve in 1913 to a reckless crusade to encourage home-ownership—laid the groundwork for an unsustainable real estate boom. He offers his views on what contributed to the current financial crisis and how the government’s response to the inevitable bust—a frenzied series of bailouts, nationalizations, and “stimulus” efforts—is only making things worse.

Finally, Mr. Allison discusses some of his proposed immediate and long-term solutions for moving us towards a stronger economy. He concludes that capitalism, far from being the cause of today’s crisis, is its only cure.

John Allison is chairman of the board of BB&T Corporation. He began his service with BB&T in 1971, became president in 1987 and was elected chairman and CEO in 1989 (serving as CEO until the end of 2008). During Mr. Allison’s tenure, BB&T has grown from $4.5 billion to $137 billion in assets.

Iran virgin prisoners raped for ‘legal’ executions

22 07 2009

Ahh, the good ol’ religion of “peace” is at it again.,27574,25815969-401,00.html

All religion is bad.  But Islam is the worst of the mainstream religions, and the western world has far too charitable a perception of Islam.  When Islamic law is taken seriously and applied politically the results are disastrous.  Thankfully Christians don’t take a lot of their ridiculously anti-human, contradiction riddled dogma seriously and therefore we have less problems. 

Atheists should be denouncing all religion.  But they should be denouncing Islam the most – and I just don’t see any evidence of this.  All religions are not equal even though they are all bad (because they all involve supernaturalism and blind authoritarianism). 

Just because many people from Islamic dicatorships are losers (with poor science, lower living standards, anti-human life politics and a legal system that has no sympathy towards individual rights) doesn’t mean they deserve any sympathy. 

The famous statue, Lady justice is blind folded for a reason.  Religion and race should not impact one’s  judgement.

So to all those people out there who think Islam is just another stupid religion.  Well, sure that’s correct, but they are the worst mainstream religion by far and don’t deserve any concessions.   The world needs to outspokenly condemn Islamic dictatorship countries and stop sympathising with those that endorse this evil, anti-human way of life.