Anthony Wants To Kill The Messenger

On Jul 24, 2008, at 10:43 AM, Anthony wrote:

John,

I blame you for my newly found fascination with economics, a topic I found agonizing in high school. I've asked myself a half a dozen times why I'm even interested in the topic. I don't have a good answer. An awakening of sorts. I don't consider myself a big thinker, but rather a pragmatic tradesman (soon to be merchant). I like to apply knowledge vs grinding away studying theories.

Anyway...


Is there a big difference in the ideas of Chicago School of economics and the Austrian School of economics? What is your view, and or the Libertarian view of Milton Friedman?

***The differences are profound... Read transformation of American Law, 1780-1860, by Morton Horwitz to get an explanation of what went wrong... how come big biz/big govt got into bed together... how come pollution happened, war etc... why small biz became hated... the changes to 1860 caused tremendous problems, which were solved by worse policies... and chaos... the chaos serves the big boys, bd boys, but it was very clear it was bad... so along comes Ronald Coase in the 1930-1950s to offer a way to rationalize the status quo. Check out his book The Firm, The Market and The Law. The Chicago school is the heart of this system, and they call themselves the Chicago school, of which monetarism is a cousin. Friedman (his book Free To Choose) calls himself a Libertarian, but his "Freedom" is in the service of efficient government. I am an anarchist so my views are not libertairan. Austrian economics starts with nonagression. Then it views humans as actors. Human motivations are ordinal, not cardinal. Austrians think anyone who tries to make a mathematical science out of human action (all public policy is based on this today) is nuts. Humans do not act as though all water is $1 a bottle, the act as though under certain circumstances, if thirsty, a human will pay $1 for a bottle of water, and then not care about the second bottle of water, at any price. Austrians recognize you cannot reduce humans to a formula. It is the only school of economics to do so.***

I've heard Naomi Klein on several left leaning radio stations in the past month or two. Klein said we should be worried about Barack Obama having been influenced by the "Chicago School" or "Chicago Boys" of economics. Klein wrote this book:

http://www.amazon.com/Shock-Doctrine-Rise-Disaster-Capitalism/dp/0805079831

***Klein is regular on govt owned media. Don't worry about Obama, Hillary will be president. But Hillary will be "chicago" too.***

She blames Free market economics for several 3rd world disasters (like Chile and Pinochet). For example, on NPR, she linked the Iraq mess to free market policy. That the policy of Paul Bremmer and other war architects (citing Paul Bremmers declaration that Iraq was, "Open for Business" shortly after the invasion) was a disaster. There was no regulation...hence the mess. She points out the Chicago School had influence on the architects of the Iraq invasion. No one challenged her assertions, she blabbed on for an hour.

***Right, Chicago also spawned the neocons... Hmmm.. Saddam hussein had free market policies? the invasion of a country is a free market event? Free markets bomb customers? Fact is, Iraq is an example of massive government intervention. Bremer said an occupied territory was "open for business" to us big biz. Blackwater, Halliburton, KBR are free market entities? I've seen countless videos of USA military taking action against free marketers on the street selling gasoline or other goods. Always the military destroys the means of production or distribution, and too often the kill the merchants. Understand, USA military operates on socialist theory. Iraq needs free markets. Yes, there was no regulation, but that misses the point. Post invasion chaos is short on regulation, isn't it? hardly a free market failure. the second part is we do not need regulation, we need agreements and property rights. Klein blames the results of socialist/neocon evil on the active good of free markets. I am sure she blabbd on for an hour without contradiction, govt owned radio sees to that.***

There was nothing free about the Iraq market. I seem to remember several stories where small US contractors were denied access to business in Iraq even though they were very qualified. You had to be with Halliburton, or KBR, or some other politically connected business to get access to Iraq. Even other countries were denied access, like France (remember, it was some kind of punishment for France's opposition to the war). How is that free? Tell me Naomi, How is that free?

***OOOhh.. you are drinking the Kool-Aid!***

Also, she has a particular distaste for Milton Friedman.

***Friedman is a gateway drug... read him and you'll end up libertarian, then off to anarchy eventually... but IRS withholding was Friedmans innovation early in his career... the wicked school- voucher idea is his... (flawed, because it is exactly what we already have...!) Friedman repudiated just about his entire life work before he died, so he is loved by those who loved his bad stuff, and loved by those who hated his bad stuff... ***

John

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