Technology alone isn’t enough

Listening to technocrats and other people who believe that government should subsidise science, I get the impression they’re unaware of the other requisites for a productive society. See page 205 of The Economic Laws of Scientific Research by Terence Kealey:

Thus non-capitalists will not create commercially-useful technology – witness the old USSR. In the absence of the appropriate culture, technological objects will assume no greater economical importance than objects d’art; when non-capitalists are offered other people’s technology, they fail to exploit it – witness the rusting tractors that litter vast tracts of the Third World.

So the point here is, without other aspects such as education, training, and the vital information of prices – we couldn’t have all these nice things. We need the price system to guide what amount of our scarce resources we should invest into which things, and at which times, and in which ways.

To extend the example above, consider what would happen if you parachuted all this nice capital equipment down into a poor nation. Think of all the other things required:

  • Infrastructure to keep that equipment maintained such as machinery repair.
  • A market in equipment parts to use in the repairs and maintenance.
  • Fuel.
  • Entrepreneurial skill to seek out or create profitable opportunities to use that tractor.

Technology is one thing, but putting that technology to productive use requires commercialisation.

The Essential Hayek by Don Boudreaux

Fantastic book here by Don Boudreaux: The Essential Hayek, published by the Fraser Institute.


This is a short book which introduces the reader to some of Hayek’s key ideas, and the concepts are deftly explained. Hayek can be hard to read, so if you lack the patience, give this short book a try. I really like the analogy in Chapter 2: Knowledge and prices. Don runs through an analogy with putting a puzzle together, as a way of demonstrating the importance of prices and of free market collaboration rather than central planning.

I’m a big fan of Cafe Hayek where Don regularly blogs, I highly recommend you subscribe to the posts. Get The Essential Hayek here, note they have a free PDF version if you don’t want to spend money.

Social change is more important than politics


This post is directed at the people who were sharing/liking the Obama worship videos e.g. this video, that basically attempted to play him up as some cool, bad ass guy (for this, and some other things). But all politicians really do is chase the polls of public opinion and modify their position to match.

Want to see a breakdown of this change in position over time? Facebook page Unbiased America has put together a nifty graph on this:


What’s the moral of the story? If you want to create change, focus on the social aspect of it, and stop worshipping politicians. They don’t deserve the credit.

Main image from Matt Bors

Victim Mentality

A mindset to be wary of is victim mentality. Fundamentally, free will underlies the libertarian view of the world, implying the ability for us to do things to change or influence outcomes. The view of the ‘anointed’ tends to run counter to this.

In The Vision of the Anointed, Thomas Sowell explains this with an interesting example on page 53/54:

As part of that vision, explanations which exempt the individual from personal responsibility for unhappy circumstances in his life are consistently favored over explanations in which the individual’s own actions are a major ingredient in unfortunate outcomes. Thus, the correlation between lack of prenatal care and high infant mortality rates was blamed by the media on society’s failure to provide enough prenatal care to poor women, rather than blaming those women’s failure to behave responsibly – whether in seeking prenatal care, avoiding drugs and alcohol during pregnancy, or in many other evidences of deficient parental responsibility. The fact that there is no such correlation between a lack of prenatal care and high infant mortality rates in groups which traditionally take more care of their children is simply ignored.

A study making comparisons within the black community in Washington found that there was indeed a correlation between prenatal care and low birth weight among infants – but the mothers who failed to get prenatal care were also smokers twice as often as the others and alcohol users six times as often…. Failure to seek prenatal care was a symptom, rather than a cause…. However, this study going completely against the vision of the anointed was almost completely ignored in the national media.

Fossil Fuels save lives

The debate about fossil fuel use needs to be reframed. I can understand where progressives and leftist environmentalists (as opposed to free market environmentalists) are coming from with their aim to preserve the earth. I just think they’re misguided:

  • The earth is not made up of scarce resources that we are continually depleting, we use human ingenuity to create more resources and/or economise on them.
  • The earth isn’t just some pre-existing ‘pristine nature’ thing that was perfect for humans and now the big bad fossil fuels companies are wrecking it. Life on earth without cheap energy (fossil fuels) is extremely harsh and we humans would have a dramatically lower standard of living otherwise. Alex Epstein skilfully points this out in his book, The Moral Case for Fossil Fuels.

The IPA recently released this report: The life saving potential of coal. And if the concern is the impact of fossil fuels use on the environment, we have to also consider the alternative, which is what people will do when they don’t have access to fossil fuel energy:

IPA energy

There is a moral case to be made here:

The things we take for granted in Australia – that our household heating and cooling works when we need it, that our meat and milk is properly refrigerated, that our stoves and ovens don’t release polluted smoke into our kitchen, and even that our televisions and lights are always available for use and mobiles can always be charged – are just not the reality in many other countries. It is just as important to people in India and the developing world as it is to people in Australia that their electricity system is reliable and affordable. The morality of seeking to deny other countries the privileges that we enjoy here, when we have the ability to help out, is deeply suspect.

Matt Ridley also has a great talk here on how fossil fuels are actually greening the planet:

“Everyone should be equal!” Visions of the Anointed: Intergroup Disparities

Thomas Sowell has a great book called The Vision of the Anointed. It reads as a contrast between the ‘anointed’ (people with a statist view of the world) and the ‘tragic’

I like the point he makes here about intergroup disparities on page 33:

Media and academic preoccupation with black-white comparisons permits many conclusions to be reached in consonance with the prevailing vision, but whose lack of validity would immediately become apparent if just one or two other groups were included in the comparison. For example, the fact that black applicants for mortgage loans are turned down at a higher rate than white applicants has been widely cited as proof of racism among lending institutions… But the very same data also showed that whites were down at a higher rate than Asian Americans. Was that proof of racism against whites, and in favour of Asians?

He continues:

In short, numbers are accepted as evidence when they agree with preconceptions, but not when they don’t.

This absurd idea that everyone should be equal in all these arbitrary ways doesn’t align with reality.

Implicit in the equating of statistical disparity with discrimination is the assumption that gross disparities would not exist in the absence of unequal treatment. However, international studies have repeatedly shown gross intergroup disparities to be commonplace all over the world, whether in alcohol consumption, fertility rates, educational performance, or innumerable other variables.

Round up

I love this paragraph by Don Boudreaux in his Tribunal Live column:

An irony that would be comical if its consequences weren’t so dire is that government’s power expands as voters demand that politicians protect them from being deceived and cheated in private markets. Ponder this strange fact: Politicians whose deceptions in elections are readily tolerated are asked by voters to police against possible deceptions by entrepreneurs in private markets. It’s like asking the brute who just robbed you at gunpoint to serve as your personal bodyguard. True, he’s got a gun and isn’t afraid to use it, but why would you trust him to wield his weapon in your interest rather in his own interest?

Also this post at the Freeman is excellent: Health Insurance Is Illegal

What currently passes for health insurance in America is really just prepaid health care — on a kind of all-you-can-consume buffet card. The system is a series of cost-shifting schemes stitched together by various special interests. There is no price transparency. The resulting overconsumption makes premiums skyrocket, and health resources get misallocated relative to genuine wants and needs.

Bitcoin’s march towards mainstream acceptance continues with Xapo announcing three big names as members of the advisory board:

  • Dee Hock – founder of Visa
  • John Reed – formerly Chairman & CEO of Citibank
  • Lawrence H. Summers – former Secretary of Treasury under President Bill Clinton

Lawrence Summers is quoted saying:

“Bitcoin offers, for the first time, a method for transferring value and making payments from anywhere to anywhere, in real-time, without any intermediary. This could mean we soon see many billions of people sending bitcoin everyday as easily as they currently send a text message.”