Saturday, February 27, 2016

David Sloan Wilson on Evonomics: An Agenda Cloaked in Science

After David Sloan Wilson wrote the article, The Road to Ideology: How Friedrich Hayek Became a MonsterPeter Boettke invited him to give a seminar at the F.A. Hayek Center for Advanced Study in Philosophy, Politics, and Economics. On February 11, 2016, Wilson presented the seminar, which is summarized here with a link to a video that incorporates a recording of the seminar and the slide presentation. I suggest that those interested in Austrian economics or coming from a non-leftist position watch the presentation as it will give you a clear idea of what we are up against. Make no mistake, Wilson and his comrades at Evonomics are heavy hitters and have an agenda that you won't like. Having listened to the presentation once, I have a few thoughts.

First, Wilson alleges that laissez-faire has its roots in the Christian worldview of universal harmony. Doing so is an attempt to discredit it as mystical and unscientific, and rob it of its roots in the Enlightenment. The reality is that Christianity was the home of top-down, unrelenting authoritarianism until it was tamed by the realization that markets tended to reduce or eliminate the antagonisms between religious groups. The resulting intellectual movement, in which those such as Voltaire argued that religion and aristocracy should be de-emphasized and commerce elevated, was probably more of an influence on Christianity than the other way around (see Jerry Z. Muller, The Mind and the Market, p 23).

Wilson goes on to state that progress came from the societal suppression of "disruptive, self-serving behaviors," rather than the realization on the part of individuals that cooperation was to their advantage in achieving goals that would have been difficult or impossible for them on their own (see Ludwig von Mises, Human Action, p 143). This view results in a bias toward top-down (coercive) rather than bottom-up (evolutionary) thinking. Wilson is definitely pushing methodological collectivism. He believes societies were successful because they dragooned their members into following the rules, not because they had rules that helped individuals flourish, thereby attracting and keeping members. Group selection is a reality, but only in the context of the feedback of individual selection that makes one group prosper over another.

While wanting to speed up group selection, Wilson fails to realize that the state suppresses selection by bypassing the feedback mechanism of profit and loss, and even imprisons its victims within its boarders, preventing the possibility of "voting with your feet." Failing the latter, there may be an effort for governments to form cartels or impose rules through a world-wide body, eliminating the possibility of selection still further. After all, if there is only one body, we are done with selection. The feedback of money profit and loss in an environment of open competition is superior, and the only objective method I can see that can facilitate group selection.

When watching Wilson's slides you will see that he believes the Earth is being destroyed by human activity. The Evonomics agenda is to reverse that perceived destruction by imposing an "intelligent design," cloaked in science, that has no possibility of effective criticism or reversal--of negative selection. Only by critically developing our own arguments and pointing out that their approach is actually anti-evolution can we succeed in defeating their effort.

Wednesday, February 03, 2016

The Economic Calculation Debate: Misunderstanding Mises and the Austrians

Andy Denis, a Senior Lecturer in the Department of Economics at City University London (see his home page), has written a paper, Economic calculation: private property or several control,
 that disputes Mises's requirement of private property to permit economic calculation.
First of all he suggests that several property, or multiple ownership, is to be preferred to private property and that control is to be preferred to ownership. These preferences, in Denis's opinion, take a socialist or planned economy out of the realm of impossibility, at least in terms of Mises's argument.

As I see it, Denis completely misses the point that the owners of private property, singly or severally, value it and are at risk when purchasing or investing. Without the risk of loss -- what Nassim Taleb calls an 'absence of "skin in the game"' -- prices are simply wild guesses and do not reflect the values or opportunity costs of market participants.

Denis does mention the principal-agent problem, in which owners are subject to the will of managers, talking as if this process amounts to expropriation.  Certainly this situation is a problem in a publicly held, bureaucratically run, stock corporation; but he fails to recognize that owners may withdraw their property from the managers if they are dissatisfied with the results. If there are no owners, there is no one to value the results, and hence no one to withdraw the property. If the benefits and costs of control are added to his system, he arrives at the a point where it is hardly different from that of private property.

Perhaps Mises fails to adequately stress the connection between the ownership and valuation of property, leading Denis to misunderstand the thrust of the argument. But it is also possible that Denis, in his eagerness to upend the Austrian/Misesian argument, has a great incentive to ignore or misinterpret it.