Browsed by
Tag: value

Heidegger, Cooney, and The Death-Gives-Meaning-To-Life Hypothesis – Article by Franco Cortese

Heidegger, Cooney, and The Death-Gives-Meaning-To-Life Hypothesis – Article by Franco Cortese

Comments 0 Comment
The New Renaissance Hat
Franco Cortese
August 10, 2013
******************************
One common argument against indefinite lifespans is that a definitive limit to one’s life – that is, death – provides some essential baseline reference, and that it is only in contrast to this limiting factor that life has any meaning at all. In this article I refute the argument’s underlying premises, and then argue that even if such premises were taken as true, the argument’s conclusion – that eradicating death would negate the “limiting factor” that legitimizes life – is also invalid, because the ever-changing nature of self and society – and the fact that opportunities once here are now gone –  can constitute such a scarcitizing factor just as well as death can.
***
Death gives meaning to life? No! Death is meaninglessness!
***

One version of the argument is given in Brian Cooney’s Posthumanity: Thinking Philosophically about the Future, an introductory philosophical text that uses various futurist scenarios and concepts to illustrate the broad currents of Western philosophy. Towards the end of the book, Cooney makes his argument against immortality, claiming that if we had all the time in the universe to do what we wanted, then we wouldn’t do anything at all. Essentially, his argument boils down to “if there is no possibility of not being able to do something in the future, then why would we ever do it?”

Each chapter of Cooney’s book ends with a dialogue between a fictional human and posthuman, meant to better exemplify the arguments laid out in the chapter and their various interpretations. In the final chapter, “Posthumanity”, Cooney-as-posthuman writes:

“Our ancestors realized that immortality would be a curse, and we have never been tempted to bestow it on ourselves… We didn’t want to be like Homer’s gods and goddesses. The Odyssey is saturated with the contrast of mortal human life, the immortality of the gods and the shadow life of the dead in Hades… Aren’t you struck by the way these deities seem to have nothing better to do than be an active audience for the lives and deeds of humans… These gods are going to live forever and there is no scarcity of whatever resources they need for their divine way of life. So (to borrow a phrase from your economists) there is no opportunity cost to their choosing to do one thing rather than another or spend time with one person rather than another. They have endless time and resources to pursue other alternatives and relationships later. Consequently, they can’t take anyone or anything seriously… Moreover, their lives lack meaning because they are condemned to living an unending story, one that can never have narrative unity… That is the fate we avoid by fixing a standard limit to our lives. Immortals cannot have what Kierkegaard called ‘passion’… A mind is aware of limitless possibilities – it can think of itself as doing anything conceivable – and it can think of a limitless time in which to do it all. To choose a life – one that will progress like a story from its beginning to its end – is to give up the infinite for the finite… We consider ourselves free because we were liberated from the possibility of irrationality and selfishness.”   –   (Cooney, 2004, 183-186).
***

Thus we see that Cooney’s argument rests upon the thesis that death gives meaning to life because it incurs finitude, and finitude forces us to choose certain actions over others. This assumes that we make actions on the basis of not being able to do them again. But people don’t make most of their decisions this way. We didn’t go out to dinner because the restaurant was closing down; we went out for dinner because we wanted to go out for dinner. I think that Cooney’s version of the argument is naïve. We don’t make the majority of our decisions by contrasting an action to the possibility of not being able to do it in future.

Cooney’s argument seems to be that if we had a list of all possible actions set before us, and time were limitless, we might accomplish all the small, negligible things first, because they are easier and all the hard things can wait. If we had all the time in the world, we would have no reference point with which to judge how important a given action or objective is. If we really can do every single thing on that ‘listless list’, then why bother, if each is as important as every other? In his line of reasoning, importance requires scarcity. If we can do everything it was possible to do, then there is nothing that determines one thing as being more important than another. Cooney makes an analogy with an economic concept to clarify his position. Economic definitions of value require scarcity; if everything were as abundant as everything else, if nothing were scarce, then we would have no way of ascribing economic value to a given thing, such that one thing has more economic value than another. So too, Cooney argues, with possible choices in life.

But what we sometimes forget is that ecologies aren’t always like economies.

The Grave Dig|nitty of Death

In the essay collection “Transhumanism and its Critics”, Hava Tirosh-Samuelson writes:

“Finally, since death is part of the cycle of life characteristic of finite creatures, we will need to concern ourselves with a dignified death… the dying process need not be humiliating or dehumanizing; if done properly, as the hospice movement has shown us, the dying process itself can be dignified by remembering that we are dealing with persons whose life narratives in community are imbued with meaning, and that meaning does not disappear when bodily functions decline or finally cease.”   –  (Tirosh-Samuelson, 2011).
***

She may have provided a line of reasoning for arguing that death need not be indignifying or humiliating (convinced me that death has any dignity whatsoever), but I would say that she’s digging her claim’s own grave by focusing on the nitty-gritty details of humiliation and dignity. It is not the circumstances of death that make death problematic and wholly unsatisfactory; it is the fact that death negates life. Only in life can an individual exhibit dignity or fail by misemphasis. Sure, people can remember you after you have gone, and contributing to larger projects that continue after one’s own death can provide some meaning… but only for those still alive – not for the dead. The meaning held or beheld by the living could pertain to the dead, but that doesn’t constitute meaning to or for the dead, who forfeited the capability to experience, or behold meaning when they lost the ability to experience, or behold anything at all.

Tirosh-Samuelson’s last claim, that death need not be dehumanizing, appears to be founded upon her personal belief in an afterlife more than the claim that meaning doesn’t necessarily have to cease when we die, because we are part of “a community imbued with meaning” and this community will continue after our own death, thus providing continuity of meaning.  Tirosh-Samuelson’s belief in the afterlife also largely invalidates the claims she makes, since death means two completely different things to an atheist and a theist. As I have argued elsewhere (Cortese, 2013, 160-172), only the atheist speaks of death; the theist speaks merely of another kind of life. For a theist, death would not be dehumanizing, humiliating, or indignifying if all the human mental attributes a person possessed in the physical world would be preserved in an afterlife.

Another version of the “limiting factor” argument comes from Martin Heidegger, in his massive philosophical work Being and Time. In the section on being-toward-death, Heidegger claims, on one level, that Being must be a totality, and in order to be a totality (in the sense of being absolute or not containing anything outside of itself) it must also be that which it is not. Being can only become what it is not through death, and so in order for Being to become a totality (which he argues it must in order to achieve authenticity – which is the goal all along, after all), it must become what it is not – that is, death – for completion (Heidegger, 1962). This reinforces some interpretations made in linking truth with completion and completion with staticity.

Another line of reasoning taken by Heidegger seems to reinforce the interpretation made by Cooney, which was probably influenced heavily by Heidegger’s concept of being-toward-death. The “fact” that we will one day die causes Being to reevaluate itself, realize that it is time and time is finite, and that its finitude requires it to take charge of its own life – to find authenticity. Finitude for Heidegger legitimizes our freedom. If we had all the time in the world to become authentic, then what’s the point? It could always be deferred. But if our time is finite, then the choice of whether to achieve authenticity or not falls in our own hands. Since we must make choices on how to spend our time, failing to become authentic by spending one’s time on actions that don’t help achieve authenticity becomes our fault.Can Limitless Life Still Have a “Filling Stillness” and “Legitimizing Limit”?

Perhaps more importantly, even if their premises were correct (i.e., that the “change” of death adds some baseline limiting factor, causing you to do what you would not have done if you had all the time in the world, and thereby constituting our main motivator for motion and metric for meaning), Cooney and Heidegger are still wrong in the conclusion that indefinitely extended life would destroy or jeopardize this “essential limitation”.

The crux of the “death-gives-meaning-to-life” argument is that life needs scarcity, finitude, or some other factor restricting the possible choices that could be made, in order to find meaning. But final death need not be the sole candidate for such a restricting factor.
***
Self: La Petite Mort
***
All changed, changed utterly… A terrible beauty is born. The self sways by the second. We are creatures of change, and in order to live we die by the moment. I am not the same as I once was, and may never be the same again. The choices we prefer and the decisions we are most likely to make go through massive upheaval.The changing self could constitute this “scarcitizing” or limiting factor just as well as death could. We can be compelled to prioritize certain choices and actions over others because we might be compelled to choose differently in another year, month, or day. We never know what we will become, and this is a blessing. Life itself can act as the limiting factor that, for some, legitimizes life.

Society: La Petite Fin du Monde

Society is ever on an s-curve swerve of consistent change as well. Culture is in constant upheaval, with new opportunities opening up(ward) all the time. Thus the changing state of culture and humanity’s upheaved hump through time could act as this “limiting factor” just as well as death or the changing self could. What is available today may be gone tomorrow. We’ve missed our chance to see the Roman Empire at its highest point, to witness the first Moon landing, to pioneer a new idea now old. Opportunities appear and vanish all the time.

Indeed, these last two points – that the changing state of self and society, together or singly, could constitute such a limiting factor just as effectively as death could – serve to undermine another common argument against the desirability of limitless life (boredom) – thereby killing two inverted phoenixes with one stoning. Too often is this rather baseless claim bandied about as a reason to forestall indefinitely extended lifespans – that longer life will lead to increased boredom. The fact that self and society are in a constant state of change means that boredom should become increasingly harder to maintain. We are on the verge of our umpteenth rebirth, and the modalities of being that are set to become available to us, as selves and as societies, will ensure that the only way to entertain the notion of increased boredom  will be to personally hard-wire it into ourselves.

Life gives meaning to life, dummy!

Death is nothing but misplaced waste, and I think it’s time to take out the trash, with haste. We don’t need death to make certain opportunities more pressing than others, or to allow us to assign higher priorities to one action than we do to another. The Becoming underlying life’s self-overcoming will do just fine.

References

Cooney, B. (2004). Posthumanity: Thinking Philosophically about the Future. Rowman & Littlefield. ISBN-10: 0742532933

Cortese, F. (2013). “Religion vs. Radical Longevity: Belief in Heaven is the Biggest Barrier to Eternal Life?!”. Human Destiny is to Eliminate Death: Essays, Arguments and Rants about Immortalism. Ed. Pellissier, H. 1st ed. Niagara Falls: Center for Transhumanity. 160-172.

Heidegger, M., Macquarrie, J., & Robinson, E. (1962). Being and time. Malden, MA: Blackwell.

Tirosh-Samuelson, H. (2011). “Engaging Transhumanism”. Transhumanism and its Critics. Ed. Grassie, W., Hansell, G. Philadelphia, PA: Metanexus Institute.

Franco Cortese is an editor for Transhumanity.net, as well as one of its most frequent contributors.  He has also published articles and essays on Immortal Life and The Rational Argumentator. He contributed 4 essays and 7 debate responses to the digital anthology Human Destiny is to Eliminate Death: Essays, Rants and Arguments About Immortality.

Franco is an Advisor for Lifeboat Foundation (on its Futurists Board and its Life Extension Board) and contributes regularly to its blog.

The Extraordinary Business of Life – Article by Sanford Ikeda

The Extraordinary Business of Life – Article by Sanford Ikeda

Comments 0 Comment
The New Renaissance Hat
Sanford Ikeda
May 25, 2013
******************************

I heard it again from this year’s commencement speaker: the common mistake of thinking economics is just about business and making money. I know I’m not the only economics teacher who every year has to disabuse his students (and many of his own colleagues from other disciplines) of that same error.

Economics is not business administration or accounting. Economics is a science that studies how people interact when the means at their disposal are scarce in relation to their ends. That includes business, of course, but a whole lot more as well.

Where Does That Notion Come From?

Well, for starters, perhaps from one of the greatest economists in history, Alfred Marshall. He opens his highly influential textbook, first published in 1890, with this statement:

“Political Economy or Economics is a study of mankind in the ordinary business of life; it examines that part of individual and social action which is most closely connected with the attainment and with the use of the material requisites of wellbeing.” (Emphasis added)

This definition more or less prevailed until 1932, when another British economist, Lionel Robbins, defined economic science as being concerned with an aspect of all human action insofar as it involves making choices, not with a part of individual action. Economics, in other words, is the science of choice. Its starting point is not the “material requisites of wellbeing” but a person’s subjective valuation of her circumstances. Ludwig von Mises got it, which is why he called his magnum opus, simply, Human Action.

Similarly, Libertarianism Isn’t Pro-Business

An equally common mistake is to think that supporters of the free market are “pro-business” and favor so-called crony capitalism. But a consistent free-market supporter is neither pro-business nor anti-business, pro-labor nor anti-labor. A free market to us is what happens when you safeguard private property, free association, and consistent governance and then just leave people alone.

Part of the misunderstanding here might stem from the term “free market” itself. Since people tend to associate markets with buying and selling, jobs, and making (and losing) money, it’s perhaps understandable that they would think that advocates of the free market must be concerned mainly about business-related stuff: profits and losses, efficiency, and creating and marketing new products.

Indeed, I’ve met quite a few who claim to favor “free-market capitalism” merely because they believe in making as much money as possible in their lifetimes. It’s not surprising that many of these folks do tend to be pro-business and supporters of crony capitalism. I want to ask them not to be on my side.

Connotations aside, the free market encompasses far more than the stuff of business or a money-making scheme. Yes, it does include the essentials of private property, free association, and stable governance. But a dynamic market process that generates widespread material prosperity and promotes the pursuit of happiness would not be possible if it were based solely on the relentless pursuit of one’s narrow self-interest. Markets would not have gotten as far as they have today (with per-capita GDP up more than fiftyfold since 1700) if people didn’t also follow norms of honesty and fair play, trust and reciprocity. Such norms are without question partly the result of self-interest; few would trade with us if we weren’t honest and fair. But, as Adam Smith taught us, these norms also arise in large measure from a sense of sympathy, of fellow-feeling and fairness, that comes from our ability to see others as we see ourselves, and vice versa. This is why in most contexts I usually prefer the term “free society” to “free market.”

Bourgeois Virtue

But I think one good reason the association between business on the one hand and economics and classical liberalism on the other has been so persistent is that business and the free society arose together. That is, the liberal idea—that certain fundamental individual rights exist prior to and apart from the State—sparked one of the most momentous social changes in history: the commercial revolution and the emergence of the modern urban middle class. 

The triumph of liberty, of personal freedom, unleashed the creative potential of people, who found expression in art, religion, literature, but most of all—or at least most visibly—in the Marshallian “ordinary business of life.” The changes that have taken place in the past 500 years—scientific revolutions, religious reformations, political upheavals, artistic rebirths—were driven by the same human propensities as the commercial revolution and fueled by the wealth it produced. Indeed, the social and political changes of the past century—for women, workers, and minorities—would not have been possible without the entrepreneurial pressures of competition and innovation that forced radical changes in conventional thinking and socially conservative attitudes.

Tradition’s Worst Enemy

In short, business is the most dynamic social institution known to mankind. The critical and competitive attitudes that enable business to flourish erode custom and break old ties even as they foster new ones. The products of business tend to offend people whose sensibilities were refined by generations of tradition. The free market is tradition’s worst enemy.

Business has become part of the default mode of modern society. We take it for granted. We don’t realize what a radical, subversive force it is, to the point where it sounds strange to say so. But try to imagine a world without businesses and commerce. A world like the Dark Ages of, say ninth century Western Europe: static, grindingly poor, strictly hierarchical, socially intolerant, and, apart from the occasional battle or beheading, boring like you wouldn’t believe.

So, while it’s still a mistake to think economics and classical liberalism are somehow about studying and promoting business, maybe at a deeper level it’s not such a bad one to make after all. Business is subversive.

Sanford Ikeda is an associate professor of economics at Purchase College, SUNY, and the author of The Dynamics of the Mixed Economy: Toward a Theory of Interventionism.
***
This article was originally published by The Foundation for Economic Education.
The Best Self-Help is Free – Treatise by G. Stolyarov II – Second Edition

The Best Self-Help is Free – Treatise by G. Stolyarov II – Second Edition

Comments 0 Comment

The Rational Argumentator is pleased to announce the publication of the Second Edition of The Best Self-Help is Free by G. Stolyarov II. This 85-page treatise has been enhanced with additional chapters and is available for free download in PDF, MOBI, and EPUB formats.

Cover Art by Wendy Stolyarov

The Best Self-Help is Free – G. Stolyarov II – Second Edition

Cover Design by Wendy Stolyarov

Public-Domain Cover Art by Albert Bierstadt (1865): Looking Down Yosemite Valley

The Best Self-Help is Free is not your conventional self-help book. Instead of leaving you poorer for purchasing it, this book can only benefit you at no monetary cost to you and with no strings attached.  G. Stolyarov II – author, actuary, philosopher, and rational individualist – presents common-sense, reason-based approaches to improving quality of life, enhancing productivity, and clearly perceiving fundamental realities in the face of widespread obfuscations, fallacies, and illusions. Unlike many self-help books, this one will not attempt to diminish you, break you down, or build you back up in the author’s image. Rather, it is written as a set of respectful deliberations on self-improvement from one fundamentally decent, intelligent person to another, based on the author’s own experiences and discoveries of approaches that truly work to achieve results.

This is the Second Edition of The Best Self-Help is Free, made available (of course) for free. The majority of this 85-page treatise was originally written in 2008. The Second Edition includes five new chapters, written in 2009 and 2012.

The Second Edition of The Best Self-Help is Free is available in PDF, MOBI, and EPUB formats.

 

Download the PDF version.

Download the MOBI version.

Download the EPUB version.

 

 

The Rational Argumentator welcomes your reviews of The Best Self-Help is Free. You can submit them to TRA by sending them to gennadystolyarovii@yahoo.com. You are also encouraged to spread the word by reprinting the information on this page or your own comments concerning the book on other media outlets.

Organic Shmorganic – Article by Charles N. Steele

Organic Shmorganic – Article by Charles N. Steele

Comments 0 Comment
The New Renaissance Hat
Charles N. Steele
October 6, 2012
******************************
A study by researchers from Stanford University of “organic” food was unable to find any health benefits, prompting a rant from NYT’s Roger Cohen against organic food.  Finally, finally, finally!  Cohen on track, rather than off the rails!Many years ago I heard Bruce Ames, a cancer researcher and head of College of Public Health at Stanford give a lecture in which he discredited the health claims of the “organic” movement and warned that it would raise costs without returning corresponding benefits.  His main fear was that this would lead people to eat fewer vegetables rather than more.  The second most important thing people can do to avoid cancer is eat more vegetables, he explained (stopping smoking is  number 1).  He based this in part on his own research with with carcinogenic properties of manmade pesticides and naturally occurring ones; the naturally occurring ones were every bit as bad and as prevalent in vegetables, and neither posed a meaningful risk in his research.  (Obviously misuse of pesticides could be a different matter.)  The new Stanford study was unable to find the superior health benefits attributed to “organic” foods, corroborating Ames’ argument.

I’ve also heard agriculture experts discuss the alleged environmental harmfulness of “non-organic” agriculture, something not covered in the Stanford study.  Again, the alleged environmental benefits of “organic” are mostly hype, and in some cases it can be worse.  Chemical fertilizers in particular deserve none of the slander that’s directed at them.  (Again, use them incorrectly and you can poison things… but that’s also true with “organic”.)

I’ve been putting “organic” in quotation marks, because the word itself always meant something different: it refers to carbon-based compounds.  That is, that’s what it meant until the word was grabbed by – let’s be honest – hippie food faddists.  “Organic” was changed to mean “simple, healthful, close to ‘nature,'” (another doubtful word), all utterly unsubstantiated claims.  Next yuppies and similar types jumped on the bandwagon, because it made them feel good about themselves “saving the planet and eating healthier and sidestepping ‘corporate agriculture,’ etc.”

This is a great example of the fundamental role of subjective utility in economic value.  Belief in “organic” is essentially religious faith, unfounded in evidence.  What makes “organic” more valuable is consumer demand, based on perceived, imagined characteristics, not some physical measurable properties.  That’s why big food corporations got into the act. They were slow to enter, and when they did, they were entirely responding to demand.  They would prefer not to produce this way, because it is costlier, but so long as consumers demand it, you give them what they want, or you lose market share.  There’s quite an irony here. Anti-capitalists frequently accuse “big business” of manufacturing consumer preferences in order to manipulate people and reap profits, yet the whole “organic” movement was manufactured by a motley collection of  anticapitalist  mystics from both left and right.

I heard NPR cover this story, and the  reporter concluded that the whole “organic” thing must have been a conspiracy by “big agriculture” (another dubious concept) to hoodwink us and get our money… a completely backwards argument, as most farmers, big or little, would prefer less costly, easier, more productive modern agricultural methods.  It’s quite common to be producing “organic” crops, meat, etc. and have some small step go wrong and have the “organic” label be lost – and even though the stuff is perfectly good, it now can’t be sold for enough to cover costs.  I’ve had farmers tell me about this, and have read of many more examples.

“Organic shmorganic” indeed!

Dr. Charles N. Steele is the Herman and Suzanne Dettwiler Chair in Economics and Associate Professor at Hillsdale College in Hillsdale, Michigan. His research interests include economics of transition and institutional change, economics of uncertainty, and health economics.  He received his Ph.D. from New York University in 1997, and has subsequently taught economics at the graduate and undergraduate levels in China, the Russian Federation, Ukraine, and the United States.  He has also worked as a private consultant in insurance design and review.

Dr. Steele also maintains a blog, Unforeseen Contingencies.

The Importance of Subjectivism in Economics – Article by Sheldon Richman

The Importance of Subjectivism in Economics – Article by Sheldon Richman

Comments 0 Comment
The New Renaissance Hat
Sheldon Richman
October 3, 2012
******************************

After many years, Frédéric Bastiat remains a hero to libertarians. No mystery there. He made the case for freedom and punctured the arguments for socialism with clarity and imagination. He spoke to lay readers with great effect.

Bastiat loved the market economy, and badly wanted it to blossom in full—in France and everywhere else. When he described the blessings of freedom, his benevolence shined forth. Free markets can raise living standards and enable everyone to have better lives; therefore stifling freedom is unjust and tragic. The reverse of Bastiat’s benevolence is his indignation at the deprivation that results from interference with the market process.

He begins his book Economic Harmonies (available at the FEE store) by pointing out the economic benefits of living in society:

It is impossible not to be struck by the disproportion, truly incommensurable, that exists between the satisfactions [a] man derives from society and the satisfactions that he could provide for himself if he were reduced to his own resources. I make bold to say that in one day he consumes more things than he could produce himself in ten centuries. What makes the phenomenon stranger still is that the same thing holds true for all other men. Every one of the members of society has consumed a million times more than he could have produced; yet no one has robbed anyone else.

The Existence of Privilege

Bastiat was not naïve. He knew he was not in a fully free market. He was well aware of the existence of privilege: “Privilege implies someone to profit from it and someone to pay for it,” he wrote. Those who pay are worse off than they would be in the free market. “I trust that the reader will not conclude from the preceding remarks that we are insensible to the social suffering of our fellow men. Although the suffering is less in the present imperfect state of our society than in the state of isolation, it does not follow that we do not seek wholeheartedly for further progress to make it less and less.”

He wished to emphasize the importance of free exchange for human flourishing. In chapter four he wrote,

Exchange is political economy. It is society itself, for it is impossible to conceive of society without exchange, or exchange without society. …For man, isolation means death….

By means of exchange, men attain the same satisfaction with less effort, because the mutual services they render one another yield them a larger proportion of gratuitous utility.

Therefore, the fewer obstacles an exchange encounters, the less effort it requires, the more readily men exchange.

How does trade deliver its benefits?

Exchange produces two phenomena: the joining of men’s forces and the diversification of their occupations, or the division of labor.

It is very clear that in many cases the combined force of several men is superior to the sum of their individual separate forces.…

Now, the joining of men’s forces implies exchange. To gain their co-operation, they must have good reason to anticipate sharing in the satisfaction to be obtained. Each one by his efforts benefits the others and in turn benefits by their efforts according to the terms of the bargain, which is exchange.

But isn’t something missing from this account?

Austrian Insight

Indeed, there is: the subjectivist Austrian insight that individuals gain from trade per se. For an exchange to take place, the two parties must assess the items traded differently, with each party preferring what he is to receive to what he is to give up. If that condition did not hold, no exchange would occur. There must be what Murray Rothbard called a double inequality of value. It’s in the logic of human action–which Ludwig von Mises christened praxeology. Bastiat, like his classical forebears Smith and Ricardo, erroneously believed (at least explicitly) that people trade equal values and that something is wrong when unequal values are exchanged.

Perhaps I am too hard on Bastiat. After all, he was writing before 1850. Carl Menger did not publish Principles of Economics until 1871. Yet the Austrians were not the first to look at exchange strictly through subjectivist spectacles, that is, from the economic actors’ points of view. The French philosopher Étienne Bonnot de Condillac (1715-1780) did so a hundred years before Bastiat wrote:

The very fact that an exchange takes place is proof that there must necessarily be profit in it for both the contracting parties; otherwise it would not be made. Hence, every exchange represents two gains for humanity.

Bastiat Unaware?

Well, perhaps Bastiat was unaware of Condillac’s argument. That is not the case. He reprints the quote above in his book and responds:

The explanation we owe to Condillac seems to me entirely insufficient and empirical, or rather it fails to explain anything at all. . . .

The exchange represents two gains, you say. The question is: Why and how? It results from the very fact that it takes place. But why does it take place? What motives have induced the two men to make it take place? Does the exchange have in it a mysterious virtue, inherently beneficial and incapable of explanation?

We see how exchange . . . adds to our satisfactions. . . . [T]here is no trace of . . . the double and empirical profit alleged by Condillac.

This is perplexing. Clearly, the necessary double inequality of value is not empirical or contingent. Contra Bastiat, the double inequality explains quite a lot, and his questions all have easy answers.

Yet more perplexing still is Bastiat’s statement in the same chapter: “The profit of the one is the profit of the other.” This seems to imply what he just denied.

Consequential Failure

Bastiat’s failure to grasp this point had consequences for his debates with other economists. For example, he and his fellow “left-free-market” advocate Pierre-Joseph Proudhon engaged in a lengthy debate over whether interest on loans would exist in the free market or whether it was a privilege bestowed when government suppresses competition. Unfortunately, the debate suffers because neither Bastiat nor Proudhon fully and explicitly grasped the Condillac/Austrian point about the double inequality of value. As Roderick Long explains in his priceless commentary on the exchange,

[E]ach one trips up his defense of his own position through an inconsistent grasp of the Austrian principle of the “double inequality of value”; Proudhon embraces it, but fails to apply it consistently, while Bastiat implicitly relies on it, but explicitly rejects it. . . .

Proudhon’s case against interest seems to depend crucially on his claim that all exchange must be of equivalent values; so pointing out the incoherence of this notion would be a telling reply. But Bastiat cannot officially give this reply (though he comes tantalisingly close over and over throughout the debate) because elsewhere–in his Economic Harmonies–Bastiat explicitly rejects the doctrine of double inequality of value.

How frustrating! Bastiat has so much to teach. But here is one blind spot that kept him from being even better.

Sheldon Richman is the editor of The Freeman and TheFreemanOnline.org, and a contributor to The Concise Encyclopedia of Economics. He is the author of Separating School and State: How to Liberate America’s Families.

This article was published by The Foundation for Economic Education and may be freely distributed, subject to a Creative Commons Attribution United States License, which requires that credit be given to the author.

Are We Destroying the Earth? – Article by Sanford Ikeda

Are We Destroying the Earth? – Article by Sanford Ikeda

Comments 0 Comment
The New Renaissance Hat
Sanford Ikeda
October 3, 2012
******************************

People often complain that mankind is destroying the earth: that insatiable consumption and relentless production have laid waste to irreplaceable swaths of our planet, and that these activities have to stop or someday it will all be gone.

Which raises the question: What does it means to “destroy” something?

When you burn a log, the log is destroyed but heat, light, smoke, and ashes remain.  It’s in that sense that physics tells us that matter is neither created nor destroyed.  Similarly, cutting down a forest destroys the forest but in its place are houses and furniture and suburbs.

The real question is: Is it worth it?

Value Can Be Both Created and Destroyed

What people usually mean when they say mankind is destroying the earth is that human action causes a change they don’t like.  It sounds odd to say that my wife, by eating a piece of toast for breakfast, is “destroying” the toast.  But if I wanted that toast for myself, I might well regard her action as destructive.  Same action, but the interpretation depends on purpose and context.

When a missile obliterates a building and kills the people in it, it may serve a political purpose even though the friends and family of those killed and the owners of the building are harmed.  The perpetrator’s gain is the victim’s loss.  In the political realm, one person’s gain is necessarily another person’s loss.  You rob Peter to pay Paul; you kill Jack to appease Jill.  It’s a “zero-sum game.”

In the economic realm, however, a thing is destroyed to the extent that it loses its usefulness to somebody for doing something.  Someone may want to bulldoze my lovely home just for fun.  If she pays me enough I may let her do it and be glad she did.  When not physically coerced, a trade won’t happen unless each side expects to gain.  If it does happen, and if the people who traded are right, then all do in fact gain.  Each is better off than before. The trade has created something–value.  If they are wrong they destroy value and suffer a loss, which gives them an incentive to avoid making mistakes.

Profits and Losses Help to Minimize the Destruction of Value

In free markets gains manifest themselves in profit, either monetary or psychic.  (In the short run, of course, you can sustain a monetary loss if you think there’s a worthwhile nonmonetary aspect to the trade that will preserve the profit.)  Now, the free market is not perfect, despite what some economics professors say about the benefits of so-called “perfect competition.”  People don’t have complete or perfect knowledge and so they make mistakes.  They trade when they shouldn’t, or they don’t trade when they should.  Fortunately, profits and losses serve as feedback to guide their decisions.

There’s another source of market imperfection.  People may be capable of making good decisions but they don’t trade, or trade too much, because the property rights to the things they would like to trade aren’t well-defined or aren’t effectively enforced.  In such cases their actions or inactions create costs they don’t bear or benefits they don’t receive.  The result is that their decisions end up destroying value.

If I free-ride off the oceans, if for example I don’t pay for dumping garbage into it, then the oceans will become more polluted than they should be.  If there is a cleaner, more efficient source of energy than fossil fuels, but no one can profitably use it because the national government prevents anyone from doing so (for example by prohibitions or excessive taxation), then again the value that would have been created will never appear.

Aesthetics or Economics?

Our esthetic sense of beauty is part of what makes us human.  If we wish to protect a lake or a valley from development because we think it beautiful, how do we do that?

To some extent it’s possible to do what the Nature Conservancy does, and purchase the land that we want to protect.  But that’s not always possible, especially when the land is controlled not by private persons but by the national government, which makes special deals with crony capitalists in so-called public-private developments.  In any case, even the free market is not perfect.  Economic development and material well-being mean that some beautiful landscapes and irreplaceable resources will be changed in ways not everyone will approve.

Remember, though, that economics teaches us that an action is always taken by someone for something.  There are no disembodied costs, benefits, and values.  In a world of scarcity, John believes saving rain forests is more important than saving the whales.  Mary believes the opposite.  If we are to get past disagreements on esthetics–essentially differences of opinion–that can turn into violent conflict, we need to find some way to settle our differences peacefully, some way to transform them into value-creating interactions.

Imperfect though it may be, the free market has so far been the most effective method we know of for doing that.

Sanford Ikeda is an associate professor of economics at Purchase College, SUNY, and the author of The Dynamics of the Mixed Economy: Toward a Theory of Interventionism.

This article was published by The Foundation for Economic Education and may be freely distributed, subject to a Creative Commons Attribution United States License, which requires that credit be given to the author.

Objectivist Virtue Ethics in Business – Article by Edward W. Younkins

Objectivist Virtue Ethics in Business – Article by Edward W. Younkins

Comments 0 Comment
The New Renaissance Hat
Edward W. Younkins
April 24, 2012
******************************

Virtuous actions can lead to the achievement of values. When one’s context is reduced to business, virtue theory contends that pursuing virtuous principles, strategies, and actions can result in firms realizing their values including their mission, purpose, profit potential, and other goals. Virtuous employees tend to carry out their roles in a competent manner that is congruent with the firm’s goals. Virtues are instrumental allowing a person to act to gain values. When business people conform to the Objectivist virtues, they increase the likelihood of achieving their values and goals. Virtue ethics stresses the importance of each individual employee being able to make contributions of value. Valid virtue concepts are required to describe what it means to be an excellent director, leader, manager, or employee. To be successful, a business needs to espouse a set of virtues that are reality-based, non-contradictory, integrated, and comprehensive.

Virtue theory holds that ethics is an inherent part of business and that it is necessary to integrate moral theory into management theory and practice. The role of the virtues in business is to direct and motivate behavior toward the success of the business. Strategic management and business ethics converge because each area has an explicit interest in the nature and goals of business. In business, the virtues facilitate successful management and cooperation and enable a company to attain its goals. The Randian virtues can provide a moral framework and integrating strategy to guide a business in achieving its goals.[1]

The virtues connect ethics to business positively and provide a sound logical foundation for business ethics. Given the laws of nature and of human nature, there exists a set of virtues that fit reality and that are most likely to lead to success and happiness in business. Ayn Rand’s Objectivist ethics specifically recognizes production as the central human value. In addition, the personal virtues that she advocated have a direct bearing on work: rationality, honesty, independence, justice, integrity, productiveness, and pride. These virtues can be used as guiding forces in a business career and in the management of a business. They define the excellent manager (or other employee) and provide the principles that a corporation should adopt with respect to investors, employees, customers, vendors, and others.

A case can be made that virtue ethics has priority over, and perhaps grounds, other competing ethical approaches to business. In most cases being virtuous will be sufficient for leading a morally decent life in the world of business. Virtue theory is more attractive, positive, unified, comprehensive, and practical than are traditional approaches to business ethics because it is concerned with the type of person that one should be rather than with rules that tell people how they ought to act. Virtue theory is concerned with the cultivation of character and provides a framework through which a person can lead a flourishing and happy life. Moral growth comes from choice rather than from conformity to rules or codes.

Traditional approaches to business ethics (i.e., deontology, consequentialism and codes of conduct) are viewed as formulaic, prescriptive, constraining forces that legislate the form of moral deliberation. Conventional approaches focus on a set of prohibitive principles or rules that tell people how they ought to act. Kantian and utilitarian act-oriented approaches concentrate only on the development of principles while neglecting the cultivation of an individual’s character. Neither deontic nor consequentialist judgments are apt to supply sufficient action guidance for resolving particular dilemmas. Virtue ethics should be viewed as a precondition of, and complement to, moral reasoning based on a deontological focus on one’s obligation to act and on a teleological focus on the consequences of an action. Virtue ethics is more fundamental, and in many cases, preempts the consideration and application of deontic and utilitarian rules. An emphasis on virtuous behavior is motivational because it depends upon a person’s ability to aspire to excellence through virtuous acts. Virtue ethics emphasizes the process of individual moral character development. Above all, virtue ethics is concerned with the flourishing and happiness of the human agent (Mintz 1996, 537-38; Arjoon 2000, 159-78; Whetstone 2001, 101-14).

Virtue theory provides a context in which strategies, plans, tactics, policies, and procedures can be developed to attain a business’s stated mission and other relevant values. Virtues can play a causal role in achieving economic success. Virtues-driven firms tend to maximize profits. However, acting virtuously does not always result in wealth creation because other factors can come into play. Despite such an occurrence, virtuous employees still can experience the internal rewards of pride, self-esteem, and the joy of knowing that they did their jobs well.

The achievement of a firm’s telos, mission, purpose, ultimate end, or ultimate value requires virtuous action on the part of the company’s employees. The ultimate value for a business is financial value. The purpose of a business is to maximize owner value over the long-term by selling goods and/or services. Most corporation mission statements explain this purpose explicitly, or at least implicitly. It is necessary to recognize a business’s distinctive purpose when organizing and integrating human effort into purposeful long-term activities. Purposeful behavior requires a single overarching valued objective function. In a corporation market price per share can be a surrogate for owner value. More specifically, the ultimate purpose of maximizing total long-term market value can provide a criterion for management decisions and choices among competing alternatives, Virtues are instrumental and support a firm’s overall telos.

To accomplish a corporation’s ultimate purpose requires the attainment of a number of goals within a business. It is possible look upon both a firm’s ultimate purpose and its goals as values that need to be achieved. Although technically a value is an object of goal-directed action, in general parlance, the terms, goals and values, are often used interchangeably. For our purposes, we can consider both the ultimate end of a corporation (i.e., the long-term maximization of firm value) and the goals that can lead to the ultimate end to be values.

Goals (sometimes referred to as objectives) are specific quantitative targets that a business needs to meet in a manner consistent with ethical principles in order to accomplish its purpose. Typical goal areas in a business include: profitability, sales, sales growth, return on investment (ROI), profit margin, cash flow, market share (or position), customer loyalty, productivity, efficiency, cost control, research and development, product leadership, employee development, employee attitudes, employee loyalty, expansion or contraction of product and service lines, reducing business risks, and so on. Each and every goal should be analyzed to determine the potential impact on firm value and whether or not they are contributing to the attainment of the firm’s target valuation. Goals whose achievement does not contribute to increasing shareholder value should be eliminated.

To succeed a business must have a superior vision and purpose to work toward and the strategic focus and direction of effort to achieve them. The Objectivist virtues can enable people to direct their actions toward the attainment of a company’s goals and values including the maximization of owner value. Virtuous actions can lead to better customer service, gains in productivity and efficiency, higher employee retention rates, reduction in employee absenteeism, improvement in employee morale, better communications both internally and externally, honest and reliable internal and external financial reporting, the flexibility necessary to adapt to market conditions, increased innovation and the more frequent and more timely launching of new products and services, higher sales and profits, sustainable competitive advantages, greater flourishing and happiness of the firm’s employees, and so on.

Virtuous behavior is required at all levels of a company from employees who realize that business is a natural and moral means by which they can satisfy their needs and attain their actualization as individual human persons. Virtuous employees are energetic, productive workers who: (1) focus on reality; (2) think objectively, rationally, and logically in applying relevant knowledge; (3) ask clear, pertinent, insightful questions and listen carefully; (4) search for facts in their total context before judging and evaluating business situations; (5) use time efficiently and effectively; (6) organize their lives and work toward accomplishing worthwhile endeavors; and (7) set value-producing goals and strive to accomplish them.

A virtuous employee begins by understanding what the facts are and does not evade the distinction between the real and the unreal. Evasion detaches a person from reality. Virtue begins with the effort to confront reality as it is. Given that there is no standardized algorithm for making business decisions, an employee needs to use his reason to make rational, logical decisions based on the facts of reality. One needs to apply conscious, prudent, rational judgments and choices in various business contexts in order to identify, execute, and implement profitable and ethical internal and external exchange transactions.

Much of morality in business falls under the rubric of honesty. Honesty means being in accord with reality. Honesty is basic to the structure of human relationships in virtually all contexts. Dishonesty is self-defeating because it involves being in conflict with realty. Morality in business involves objectively recognizing and dealing with customers, employees, creditors, stockholders, and others as autonomous rational individuals with their particular goals and desires. The trader principle should govern the course of all human interactions because voluntary value-for-value relationships are consonant with human nature.

Honesty is closely related to the virtue of justice. Justice, a form of faithfulness to reality, is the virtue of granting to each man that which he objectively deserves. Justice is the expression of man’s rationality in his dealings with other men and involves seeking and granting the earned. A trader, a man of justice, earns what he gets and does not give or take the undeserved. For example, a virtuous manager must make sure that customers get what they pay for. In addition, he needs to identify employees for what they accomplish and treat them accordingly. Employees should be objectively appraised and compensated based on their contribution toward achieving a firm’s mission, values, and goals. A virtuous manager will discriminate among all those that he deals with (i.e., customers, suppliers, workers, etc.) based on relevant qualities and personal merits such as ability, competency, performance, and character. He will not improperly discriminate based on irrelevant characteristics such as sex, race, nationality, and so on.[2]

Although individuals can learn from each other, the fact remains that each of us thinks and acts alone and is responsible for his own actions. Independence requires the acceptance of one’s intellectual responsibility for his own existence, requires that a man form his own judgments, and that he support himself by the work of his own mind. It is not a corporation’s fault if someone does not attain his goals. Each employee is responsible for his favorable or unfavorable outcomes in a business setting where responsibilities are defined by, and arise out of, his particular role. Of course, a goal may not be completely under one’s control. It may require interdependence with or on other employees who co-contribute to whether or not someone attains a goal. Positive change and innovation in a company are based on the creativity of logical independent thinkers. It is through such employees that a firm discovers and invents ways to improve the fiscal bottom line thereby increasing the firm’s market value.

Integrity is the refusal to permit a breach between thought and action. It means acting consistently with rational principles that will lead to success and happiness. In business, an employee’s rationally-made plans are integrated with his actions in order to bring values into existence. From more of a macro viewpoint, we could say that the integrity of a business is maintained if the purpose for which it was created is followed (i.e., the maximization of owner value).[3]

Productiveness, the virtue of creating material values, is the act of translating one’s thoughts and goals into reality. Productiveness comprises an important existential component of virtuousness and is a responsibility of every moral person. It involves a commitment to creating value and to being self-responsible for bringing what one needs and wants into existence. Workers in a business are committed to producing wealth and bringing about well-being by taking the actions required to achieve the firm’s mission. Profits are an indicator of productive work on the part of people who want to achieve, produce, and improve well-being. Because people differ with respect to their intelligence, talents, and circumstances, the moral issue becomes how a particular employee addresses his work given his facticity, including his potentialities and concrete circumstances. In a business, the Randian virtues (including productiveness) offer a set of principles for getting the most value from one’s work. Rand’s Objectivist ethics recognizes that individuals search for meaning and purpose in the various components of one’s life (i.e., one’s work life, love life, home life, social life, and so on). Each of these is an end-in-itself and a means to the end of one’s life in total. One’s life in total is an end-in-itself and an ultimate value.

Pride, also called moral ambitiousness, is a man’s commitment to achieving the best in his life thereby effecting his moral perfection. Pride is the reward we earn by living by the other six Objectivist virtues. A businessman’s drive for success is a result of his taking pride in the business portion of his life. Each employee needs to work in a way as to be able to be rightfully proud of what he has done. Work is needed not only for sustenance, but also for one’s psychological well-being—it can be viewed as a means by which a man can maintain an active mind, attain purposes, and follow a goal-directed path throughout his lifetime. Through work a man can achieve his highest potentials. Doing work well in accordance with the goals of a firm (which are aligned with the personal goals of the worker) can cause an employee to positively enhance his self-esteem.

Dr. Edward W. Younkins is Professor of Accountancy at Wheeling Jesuit University. He is the author of Capitalism and Commerce: Conceptual Foundations of Free Enterprise [Lexington Books, 2002]. Many of Dr. Younkins’s essays can be found online at his web page at www.quebecoislibre.org. You can contact Dr. Younkins at younkins@wju.edu.

 

[1] Ayn Rand’s Objectivist ethics is specifically related to business and business ethics in Kirkpatrick 1992; Greiner and Kinni 2001; and Hicks 2003.

[2] See Locke and Woiceshyn 1995 for an argument for honesty in business from the perspective of rational egoism.

[3] Paine 1994 provides an interesting perspective on how to manage for organizational integrity.

References

Arjoon, Surendra. (2000). Virtue theory as a dynamic theory of business. Journal of Business Ethics, no. 28: 159-78.

Greiner, Donna and Theodore Kinni. (2001). Ayn Rand and Business. New York: Texere.

Hicks, Stephen R.C. (2003). Ayn Rand and contemporary business ethics. Journal of Accounting: Ethics and Public Policy 3 (1) (Winter): 1-26.

———. (2009). What business ethics can learn from Entrepreneurship. Journal of Private Enterprise 24 (2): 49-57.

Kirkpatrick, Jerry. (1992). Ayn Rand’s objectivist ethics as the foundation for business ethics. In Business Ethics and Common Sense. Edited by Robert W. McGee. Westport: CT: Quorum Books 67-88.

Locke, Edwin A. (2001). and J. Woiceshyn. (1995). Why businessmen should be honest: The argument from rational egoism. Journal of Organizational Behavior 16: 405-14.

Mintz, Stephen M. (1996). Aristotelian virtue and business ethics education. Journal of Business Ethics, no. 15: 827-38.

Paine, Lynn Sharp. (1994). Managing for organizational integrity. Harvard Business Review 72 (March-April): 106-17.

Rand, Ayn.  (1964). Objectivist ethics. In The Virtue of Selfishness. New York: New American Library.

Whetstone, J. Thomas. (2001). How virtue fits within business ethics. Journal of Business Ethics, no. 33: 101-14.