The National Socialist wing of the far-Right calls me a “Libertarian” because I have always advocated Libertarian economic thought, since in my view it is the only working model. Capitalism reflects economics; socialism (including National Socialism) attempts to control it.
Its other problems reflect its repression and modernism. Tyranny attempts to control people in lieu of having good people; like r-strategies in reproduction, it is designed for masses of selfish morons.
When you get to the point where you are trying to control the behavior of people in order to influence their minds, you have already lost The Civilization Game. You are trying to make masses of selfish morons behave like humans, when they will not because they cannot. They are ruined. A sane leader tosses out the bad — exile or execution, doesn’t matter which — and then breeds the good like cattle.
Modernism means that you run a bureaucratic society. This provides the root of egalitarianism: there is a line, and someone hands out food packets to everyone who waits in line, and so everyone is “guaranteed” a “regulated” result, even if the packets shrink each time because the people handing out food need to eat — as it turns out, a lot — too.
The humonkey proves disturbingly easy to fool, and most of them think bureaucracy, regulations, and lines are good things because they are “fair.” Everyone gets treated the same. The flaw in this is that people are not the same; Dave over there, for example, has an ulcer, so he needs more potatoes, but if we give him those, every other monkey in the crowd will start wailing. Susan over on the other bench happens to live in a cubicle condominium that gets lots of sun, so she converted her living room into a garden, and now has more food than she can use. It is neither fair to give her nothing, nor to give her the same as everyone else, but the Crowd will only support the former without gnashing of teeth and flinging of feces.
We label a certain science “economics,” which both gives us a topic orientation and limits that topic. This proves unfortunate, since a master science exists. Perhaps it describes fluid motion, balance, or simply the adjustment of complex systems to their context, but it also describes both economics and how political systems work. It, too, will be close to Austrian economics, and I prefer that over the calculus of power that says that if you fool enough humonkeys, you have the power — for how long? no one says — and can do whatever you want. Even if you possess motives that are 100% pure, as some say Hitler did (and not knowing him, who am I to say otherwise?) you cannot use this kind of power for good. It serves only itself, much like economics, and the instant you ram that square peg into that round hole, you will create an equal and opposite reaction that is going to destabilize and destroy your power.
On the other hand, economics and natural selection point to another kind of power which is based in value. That is: some things have more utility than others, and this utility is demonstrated not to other people, but in the context of the environment to which they must adapt. If you are on a boat full of canned goods adrift in the ocean, suddenly a can opener becomes much more valuable than a laptop computer or gold necklace. If you are a small population drifting nomadic between hills and steppes, then good leadership becomes more valuable than ability with trade and socializing.
For this reason, it makes sense to understand Austrian economics, which bases its recognition of economic theory in the following: the intersection of supply and demand alone regulates the voluntary exchange of goods and services for tokens of value (money, hookers), and this means that the values of goods and services are determined by their relative scarcity. If gold rained from the sky every Tuesday, we would not consider it valuable; similarly, if aluminum was found only in the tips mountains wracked by deadly storms, we would all adorn ourselves with aluminum, because it becomes a good token of value since the supply is limited and scarce.
Humans adopt one of two basic economic theories:
We might call the former the Agrarian View and the latter the Shopkeeper-Merchant View. The Agrarian realizes that his crops will sell for a certain price, and if there are fewer crops, that price goes up, so if he is a decent fellow, he does his best to keep supply high.
The shopkeeper (or merchant, a kind of wholesaler and international trader) sees a different view. If suddenly people get a mass craving for asparagus, he will mark it up because he can, even though supply is not yet contracting.
The classic human pattern reveals itself here. Farmer Jonas tells Misses Ransom that the asparagus crop has been just awful this year. He is just making conversation; for her, on the other hand, it means ruined dinners. She rushes off to the markets and buys all that she can, but first she whispers to her friend Mistress Anson that the price of asparagus is going up. Anson hauls off and buys up every stalk in her county.
The merchants see this, rub their little gold-polished hands, and jack up the prices. This sends a signal to other customers: this resource is scarce. They promptly buy it up not in huge amounts, but more consistently, so that instead of one-in-ten customers buying asparagus it is now one-in-five.
At this point, the farmers notice that the merchants are asking for more asparagus and the supply is dwindling, so they jack up their prices; in response, the merchants jack up the price further. This makes asparagus a new form of gold. It serves as a proxy for value. Instead of buying a BMW, you have asparagus in a vase on your desk or something like that. Humonkeys love adornments to signal prestige, because that causes other people to figure that you are Important and get the heck out of your view, which delivers a certain time efficiency and reduced stress/repetition headaches.
We The People, outraged at the price of asparagus and fearing that they will miss the asparagus boat, run to their elected bureaucrats. “We have an asparagus gap with Russia, and the distribution of the stalks is unequal!” Hoo boy. Now we are off to the races. The bureaucrats shift from a supply-based strategy to a demand-based strategy and seize or buy up all of the asparagus, and then divide it into little equal packets. Every citizen gets two and a half stalks.
Of course, everyone sane — a tiny minority of the population — recognizes that this is a gesture, or symbolic act, not a practical one. You can do just about nothing with two and a half stalks of asparagus except mix it into cheaper ingredients and produce an asparagus-flavored something-or-other. In fact, since the flavor becomes more pronounced as it decays, you want to let your stalks rot a little before grinding them into a paste of sour cream, mayonaisse, and cream cheese with salted butter. Soon everyone is eating bad imitation food and talking about how great it is that asparagus equality has arrived. When Pentti Linkola wrote about the low biological quality of humankind, this is what he had in mind; most of them simply cannot think, in the sense of unbounded analytical judgment, and even fewer can tell the difference between a sensible (logical, realistic, and qualitative) assessment and a face-value (optics, popularity, demand, quantitative) one. Something about Shinola goes in here, but we still pretend that this is family-friendly site, so I’ll leave it at that.
By the way, in the meantime, something curious has happened among the wealthy. They look at asparagus now and see something that signals absolutely zero prestige since it is being handed out willy-nilly, sort of like how wealth alone became insignificant after the 1960s, when it became clear that rock stars, movie producers, pornographers, mobsters, and toy sellers were as rich as the founding stock. After that point, since ideology had gripped society, we became a virtue/shame based society, where it was not enough to have money… you also had to save the rainforest, talk to the whales, make ethical products, and help the poor. When you hand out luxury items to the poor, the rich begin to fetishize virtue itself, and so you get people who grow their own artichokes in the ashes of their ancestors and their own bodily waste, proclaiming this the most virtuous way to produce artichokes. Eventually the lower echelon shoppers figure this out and rush to the store for artichokes, but, alas! These are not ethnic artichokes, and so they cannot compete. The ash-feces artichoke has become the new gold, and asparagus, the new potato.
This economic cycle plays out in another way. Suppose that a society has never had asparagus. A bright young lad names Mads Perkins decides to import the seed and begin growing asparagus in abandoned graveyards in upstate New York (do not do this at home). He brings out this new product, the asparagus, to grocery stores. At first, very few pay attention, but a few pioneering cooks find uses for it, and soon the hipster wing figures out that the best way to be different, unique, and iconoclastic is to incorporate asparagus into everything, like they did with avocados in the 1970s. The bored suburbanites, fearing that their lives consist of comfort and nothing else, emulate this in turn, but make these exotic foodie recipes into normal everyday meals like casseroles, dips for potato chips on game day, and salads. The hipsters, outraged, turn their allegiance to quinoa and arugula with a hrrumph! But now a market exists for asparagus, so the big companies send out their MBAs in legions to find seeds… then sic their scientists on the poor gametes to make unique varieties… then buy up local warlords and help them kill off their competition so that they can guarantee third-world production zones… soon asparagus has landed in every store.
At this point, something interesting happens. Competition — increased supply — drives prices down because the scarcity of the good has decreased. What was once a gold-proxy becomes silver, then copper, then bronze, and finally aluminum when you can buy it in cans at any convenience store. This takes about a generation, or thirty-three years in the old parlance, since the new product enjoys exclusivity for about a decade, high-end status for another, and becomes normed in the third, having taken about three years to catch on in the first place. Asparagus was once a high-margin item, meaning that the difference between cost and sale price was rather high, but with competition, knowledge about it increased, so production costs went down but so did prices as it became more abundant thanks to this knowledge. In the third decade, consumers expect asparagus to be as normal as corn and priced accordingly in their grocery stores. The first guy to bring it to market scored big, the companies to follow made a reasonable profit, and no one makes out like a bandit from asparagus; they are on to quinoa and arugula, which they are about to start mass-producing, driving down the price and beginning the cycle again.
Now suppose that a new leader has taken over the land named Barack O’Biden. He favors the demand-based economy like his predecessors in the party he has chosen to represent him, and so he wants to increase the supply of money by giving it out to people to eliminate poverty. In this way, he reasons, he will stimulate the motion of money through increased demand, and consequently, increase the size of his economy, making his government more powerful. He mandates that government mail out checks to every citizen, and that it lower interest rates — the monthly charge for borrowing money — so that people can borrow more and thus, buy more and spend more, “priming the pump” of a Keynesian economy.
What will happen? We now enter into a domain where face value separates from effective value, and consequently, package sizes shrink:
Many major ice cream makers, hit by higher dairy costs, have shrunk their standard containers to 1.5 quarts from 1.75 quarts, about 1 cup less. The industry downsized from the traditional half-gallon (2 quarts) five years ago. In both cases, only the package shrank, not the price.
The humonkey can watch one factor at one. Price, normally the factor they watch, sets off a panic if it rises. However, relatively few of them will notice that a package is fifteen percent smaller. Those that do will recognize immediately what is going on and shift their buying habits. Dessert will be sherbert this week, kids. They recognize what is going on because they are probably doing the same at their jobs. Activation fees, transfer fees, monthly fees, penalties, and shipping costs all go shooting up, mainly because in each of these the company makes some profit, enough for it to claim that its prices are merely responsive to inflation and COLA (cost of living adjustment) instead of rising rapidly because the currency has lost value.
To your average person, the idea of money — a token of value — having value in itself proves baffling. To them, money means money; more is better, and so if the price goes up it is bad, but if salaries go up, it is good. To them, they just got free money in the mail, so now they will be able to buy more stuff, but they forget that the context of an action adjusts to that action. When fourteen hundred dollars is the new zero, any amount below that will be worthless, so the manufacturers have adjusted the price so that every pallet of ice cream they ship will generate fourteen hundred dollars more. It turns out that the supply-demand curve applies to money itself, too, and so as the demand for money drops because there is more floating around, so does supply.
In other words, once you start handing out free asparagus, the only real value comes from artichokes, so the smart people — those who already have the money — quickly convert their asparagus into artichokes (this sounds like the basis for a terrible meal). They get you to pay them in asparagus, then use that asparagus to buy artichokes, which they hoard. In a O’Biden style economy, people stick their money into homes and stocks, knowing that these will retain value and can be unloaded later when a Republican gets in power and they can cash out; this is unrelated to the current boom in home pricing caused by White Flight to the suburbs since the inner cities are burning again with diversity riots. Demand-based economies reduce the value of money and increase the price of everything, which benefits those who already have things worth selling. Supply-based economies increase the value of money and reduce the price of everything, which benefits those who spend less money on small things and spend more on things which produce more money, like farmland, tools, and education.
This tells you what to expect in the O’Biden economy. Your home will become more valuable; you will spend more money on everything else. The more government spends, the more this will increase, until at last you have a Jimmy Carter style permanently sluggish economy, simply because it costs to much to do anything differently or change direction — this same factor blights large corporations — and so everyone just keeps acting predictably, which increases political stability but erodes the wealth and potential of society because it cannot respond to changes in its environment, therefore by Darwin’s law is heading to extinction.
Tags: austrian economics, demand-based economics, keynesianism, libertarianism, supply-based economics