Economic Reasoning
vs
Accounting Fallacies
The Case of ``Public´´ Research

François-René Rideau

http://fare.tunes.org/

This is an adaptation to English of my essay Raisonnement économique contre sophismes comptables, le cas de la recherche ``publique´´, published in April 2003; this translated version was first published in July 2004. Many thanks to Bruno Rouchouse and to Johan Buret for their initial partial translations; however, I am the only one responsible for any bad choice in the translation, and I welcome constructive criticism to improve it.


1 Fallacies Without Any Doubts
2 ``Public´´ Research
3 ``We Owe Everything To The State...
4 ... Especially Our Misfortunes!''
5 Accounting Fallacy
6 Revisiting Fallacies
7 Restoring Accounts
8 Research Corrupted
9 Political ``Efficiency´´
10 Monopolist ``sharing´´
11 Politics vs Liberty
12 False Charity
13 Qualitative Effects
14 The Long Run
15 The Case Of Computers
16 Conclusion: Fighting Fallacies


1 Fallacies Without Any Doubts

I am subscribed to a french-speaking mailing list about zetetics, the art of skeptical inquiry — as applied to debunking pseudo-science and superstition. And from time to time, I receive through this list messages that appal me by the economic fallacies they convey. What is most remarkable is the way that these messages are seemingly accepted with seriousness and solemnity by the other members of the list (at least among those who express their opinions), whereas my debunkings are greeted with repetitions of the fallacies, ad hominem attacks and rehashing of communist propaganda, in a general consensus. Thus, people who are proud of their critical mind, and endowed with a robust scientific training (though admittedly in France) end up defending, in irrational ways, absurd theses.

Self-interest explains part of this behavior: when economic fallacies serve to defend the funding of public research and more generally to defend the welfare state, out of which a scientist lives, believes he lives, or intends to live, it can be expected that the first reflex of said scientist be to defend his turf. Rationality comes second after self-interest — which tears down the myth of scientists and other ``experts´´ as objective, pure minds, rather than as humans primarily moved by their self-interest, like all other humans. But beyond this reflex, the ease with which these fallacies prevail, the almost complete lack of resistance to these fallacies, are the sign that something is rotten deep down in the way that opinions are made, by scientists in particular, and by the public at large.

2 ``Public´´ Research

Thus, being confronted to a petition for the extension rather than the reduction of the public funding of research, I rose against the very notion that there should be public funding of research. Indeed, notice that what ``public´´ means in this context is nothing else but ``managed by the state monopoly of violence´´, as opposed to ``left for free citizens to take the responsibility of organizing it´´. The right term to describe the phenomenon should thus be ``political´´ management of research, as opposed to ``freedom´´ in research. And this freedom includes of course the freedom to choose which research to fund and which researchers to fund, as well as the freedom to decline participation in research endeavours in which one isn't interested. For the public benefits as much or more from research when the funding of research is ``private´´, that is, done on a voluntary basis through donations and contractual exchanges between members of the public than when the funding of research is ``public´´, that is, done on a compulsory basis, with citizens being deprived from taxes that profit to a privileged cast.

The consequences of political management of research are thus as follows: numerous research endeavours are half completed but never finalized, were never made useful for the public; other research endeavours receive titanic credit lines totally disproportionate with their utility; yet other research endeavours remain unfunded; funds are distributed through nepotism, that is, people receive credits according to their relation with committee members rather than to their achievements; researchers are isolated from each other, from manufacturers, as well as from the public; researchers are generally demotivated; the public completely loses any sense of responsibility in research, not having any influence on the allotment of funds (qualitative aspects of the distribution of funds is never the stake of an electoral ballot). Such are the inconveniences of political monopoly, and we may summarize them as: injustice, plunder, responsibility deficit, inefficiency.

Socialists and other statists — proponents of the extension of the state — will claim for sure that ``the private sector is motivated by profit, [and that consequently] only the public sector can possibly take long-term decisions´´. Such an assertion is based on such a sequence of fallacious confusions that long explanations are required to expose all its errors.

In short, the arguments for political intervention, in research as in every other domain, are fallacies [4]. The only position that is at the same time respectful of individual rights and compatible with timely progress in science, the only truly humanistic position, is the (classical) liberal position: That every individual should be free to fund research endeavours of his choice, or any other activities of his choice actually, according to whatever he considers is marginally most useful, entrusting directly or indirectly his money, his time, his resources, to whichever persons of his choice, who appear to him to be most able to undertake or supervise the aforementioned endeavours. And if someone, facing the complex choices being considered, prefers to entrust one's money and to delegate one's decisions to a Minister named by Chirac, Le Pen, Jospin, or any other man or institution of one's choice, who will in turn distribute those funds as he wants, that one's problem! But one may not coerce any other person into entrusting that person's money to such man or political institution, for that would be nothing else but theft.

3 ``We Owe Everything To The State...

Now, the fallacy that comes up most frequently, and by far, and which seems perfectly convincing to all debaters, is as follows; we introduce it under multiple forms:

Do you believe that [such ruinous project, but that makes us very proud about: the Concorde, the TGV, the man on the moon, etc.] which mobilized engineers and technicians during years, would have been achieved without public intervention?

It is thanks to American military credits that computers and the Internet exist. Don't you criticize public research with an Internet-connected computer!

Before criticizing the State, you should pay back for your studies in government schools, your trips on government roads, etc. Pay back for everything you owe to the State!

It is thanks to the State that we have [everything that the State has done for us]; without the State, we wouldn't have any of it. So, do you want to deprive us from [all this]?

Can you, fearless reader, identify which is the fallacy common to all these assertions? Are you capable of demystifying it? I dare you to try out before you read the rest of this article...

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4 ... Especially Our Misfortunes!''

With such reasoning, one must justify the slavery: without it, how would we have had the roads, etc., which were built as of old, and thanks to which our civilization could be built? It is necessary to justify National Socialism: without it, how would they have highways in Germany? It is necessary to justify International Socialism: without it, how would Russia have been electrified? Actually, everything that has ever existed is justified by this reasoning, since whatever exists today exists only through what has been done in the past. It is also necessary to justify every misfortune, poverty, etc.: if it had not been necessary to face them, how would people have made the efforts that have led them where they are today?

If the one who funded the inventors deserves all the credits for an invention, then it also necessary to assign to the Roman Catholic Church (and to the inspiration of the Christ) the works of Mozart, whereas one will congratulate Joseph Stalin for the compositions of Shostakovich, who was official composer of the regime. Without the Roman Catholic Church, would there have been Mozart? Without Bolchevism, would Shostakovich have composed what he composed? Nothing is less certain.

Let us consider as valid the argument according to which I have to repay for my studies before I may have the right to criticize the national education system that offered me my studies free of charge [5]. With the same argument, North Korean citizens, who owe absolutely everything to the totalitarian state where they live [6], in a country where reign terror and starvation, have not the slightest right to complain about their State, until they did repay everything to this State. In other words that this argument completely denies them any right to complain.

On the other hand, why only look at good things? One could as well look at the bad things that follow from the intervention of the State and apply the same reasoning! Public research brought us mustard gas and the atom bomb, anti-personnel landmines and napalm, electronic surveillance, phone-tapping, truth serums, mind control of the masses. Would these projects, that required considerable means, have been developed without the power of intervention of States? Isn't it the States that led to all the wars, small and big, civil and world-wide — and to all the genocides? If we are to have a one-way vision of the State, why shouldn't this negative vision be more accurate?

When a heritage is claimed, one cannot pretend to the assets while refusing to honor the debts. If it were necessary to praise the State for all the benefactions attributed to it, would it not necessary to blame it for all the evils it may have brought as well? In any case, one must assess and compare advantages and disadvantages before one may assert that the balance is globally positive. And among the advantages and disadvantages, one must include the daily costs and benefits as well as the spectacular successes and failures.

Thus, there is something fallacious in the argument according to which ``since the State historically served to do this useful thing, it is useful´´.

5 Accounting Fallacy

Actually, the ``argument´´ being invoked, in the end, sums up as a claim that ``everything that happened is justified´´. But it cannot say anything about the future. Because with the same reasoning applied to the future, we can say that whatever the future will be will be justified, but we cannot say whether on the way to this future, the ``public´´ funding of research will have been extended or abolished.

The elementary reasoning mistake behind each of the above fallacies, is to apply an accounting calculation as the justification of a moral conclusion: events that happened are examined, and rightfully considered as a cause of what is happening now, while insisting on a good (respectively bad) aspect of what is happening, and it is deduced by a non sequitur that what happened was good (respectively bad) as compared to proposed alternatives. An accounting calculation is a comparison between a before and an after. An accounting calculation doesn't consider any alternative to whichever actions did happen, and thus cannot possibly allow to reach any conclusion concerning any such alternatives. To make a choice between alternatives, it is necessary to undertake an economic calculation: to compare several opportunities, several possible futures for a same present, according to choices available at a given moment, and knowing that at most one of these futures can possibly realize, depending on the choice that will be actually made.

Accounting calculation takes an interest only in accounting costs, that is, in property transfers that happen as an operation unfolds. Economic calculation takes an interest in economic costs, that is, in the difference between the outcomes of several operations that may possibly involve the same given resources. (This difference in outcome is also called opportunity cost.) To use an accounting calculation in place of an economic calculation, is an accounting fallacy [7].

It can thus be observed that publicly funded research is (by definition) paid by the Government, — with money taken from taxpayers, — and that an accounting book will thus contain a line crediting the Government with every discovery made through publicly funded research. But does that mean that the same discovery, and even more discoveries, wouldn't have happened, — with a different line in an accounting book, — without intervention of the Government? This is an economic question, and accounting calculation is by its very nature incapable of answering it. Yet, it is this very question and none else that is being raised. To answer it, it is thus necessary to embark in an economic calculation [8].

6 Revisiting Fallacies

Let's apply our debunking endeavour to the preceding accounting fallacies.

Would there be roads in Germany without national-socialism, electricity in Russia without international-socialism, wheat in France without the Common Agricultural Policy, and telephones in the world without any Government-granted monopoly or patent? Well, of course there would! The Nazis didn't invent roads, etc. To what missed opportunity was substituted the construction of motorways by the national-socialist government? To the sane economic development of society, that would have led to building different roads, motorways, railways, etc.; these transportation infrastructures would have been build not only according to a different timeline, but also according to a more satisfying layout; they would have been built to satisfy civilians rather than the military; they would have joined cheaply the industrial centers to the commercial centers, rather than to join expensively the barracks to the borders. Similarly, there would be electricity in Russia without bolshevism, and it wouldn't have cost millions of deaths, Tchernobyl, and all the associated sorrows. There would be wheat in France without the CAP, and rather than there being an over-production of subsidized agricultural products, there would be production of other agricultural products instead that are relatively less favored by the current CAP [9].

Shostakovich was paid by Stalin, but could just as much have been paid by the Czar, by the Republic, by a private foundation, by a record company, by patrons found by an impresario, etc. In all rich countries, there is no shortage of patrons for talented artists. At worst, Shostakovich would have emigrated, like Rachmaninoff did, or would have otherwise found foreign sponsors. Stalin didn't make Shostakovich's talent appear by waving a magic wand; he but corrupted this talent, by forcing it to fit the canons of ``socialist realism´´, by giving him nightmares in the night, by making him insensitive to the horrors that abounded around him, etc. It is impossible to know what Shostakovich would have composed without the victory of bolshevism, but it is sure that he would have composed, and that his sensitivity would have been but greater. Similarly, Mozart would have composed under any regime that wouldn't have forbidden music, and if he wouldn't have composed for the catholic church, it would have been another institution, religious or laical, public or private, austrian or foreign, as long as it would patronize arts.

Let us review the argument ``pay back the Government before you may criticize it´´. According to accounting calculation, North Korean citizens owe everything to their totalitarian State, and slaves owe everything to their master, and Frenchmen owe all of their education to their Government. But before we may conclude that the action of this creditor was positive, we must compare what would have happened if those debtors would have been left free rather than being offered such dubious compulsory benefits. Now, State communism caused the bankruptcy of North Korea, reduced its inhabitants to the most abject famine, despite international help. If international-socialism hadn't destroyed the economic organization of the country, the North Koreans, instead of having the choice of dying either out of hunger or out of a bullet in the neck, would be as well-fed as South-Koreans; and South-Koreans as well as North-Koreans would both be better fed than they currently are, for they would cooperate in creating riches, instead of destroying wealth at waging a cold war. Similarly, slaves, though they owe the little they have to their masters, would be far richer and happier if they could only be free. And the French citizens who are educated by this ever-renewed catastrophe that is the politically imposed national education would be better educated if they were individually free to seek their own education and that of their children wherever they consider it to be best fit to themselves. If someone had to pay back something, it would be the Government officials who would have to apologize and to be condemned to pay back whatever they can for the damages they caused, out of whatever riches they diverted to their own profit.

When a statist accuses libertarians to seek the ruin of the people by abolishing political control, it is as if the socialists were to accuse us of not wanting persons to eat because we do not want the state to raise grain. Quite on the contrary, we think that Government has a negative role, as evaluated in terms of economic cost, of opportunity cost. Government intervention in agriculture has wreaked famine in Ireland and in Ukraine in the past, and wreaks it today in North Korea. We resist the growing of wheat by Government precisely so that men would eat in abundance. And we resist the intervention of Government in research, in education, in the production of security, precisely so that men would invent more and better, so that they would be better educated, so that they would live in a greater and safer security.

Finally, and to take back the proposed argument, why shouldn't state officials, before they may criticize private spending, first have to pay back all the taxes they raised upon taxpayers, and why shouldn't they pay for the damages and inconveniences incurred by citizens due to their action? According to which justification do they claim to have more rights upon the riches they seize than the people who created those riches?

7 Restoring Accounts

We may thus notice that an accounting fallacy always comes accompanied by one-sided accounting[10]: the political fraud shows the one side of political intervention that backs his discourses — the allegedly beneficial spendings of Government — and refrains from ever mentionning the other side of these spendings, that would discredit him — the tax income of Government, that bleed the taxpayers. If he ever mentions these taxes, it will be in an attempt to minimize the idea of them, or to make believe that they rest upon other people than the voters of whom he tries to win the support [11].

It is through such accounting stunts, and only through them, that political frauds can hide the fact that the ``benefits´´ of their action, that are seen can exist but to the detriment of all those prevented actions, that would have employed the resources that have been seized or otherwise controlled by the politicians. To every prevented use of these resources thus corresponds a loss that is not seen. Therefore, the principle of every political deception is verily the fallacy of that which is seen and that which is not seen. Behind their accounting fallacies and their one-sided accounts, political frauds hide the true nature of the Government intervention they advocate: coercive violence, employed to prevent the activities that free men would have found more profitable to themselves [12], and to promote activities meant to please whoever holds the political power.

While reviewing accounts with this notion present in mind, we then become aware that behind every positive point of political intervention, there are two negative points: on the one hand, the levying upon society of resources that correspond to the accounting costs of the positive point (in such a way that even from an accounting point of view, once accounts are unfolded, political intervention creates nothing), and on the other hand, all the costs associated to compulsion, which costs get more important as the intervention necessitates more compulsion, that is, as the intervention is more political [13]. All in all, political intervention will thus confiscate resources that match the amount necessary to pay for the visible benefits through the inefficient means of the public administration, to which must be added all that is needed to feed the political apparatus itself, with its hordes of politicians and privileged courtiers, and the minions at their service, plus the collateral damages in the war waged by the fiscal and regulatory machine against the taxpayers and the citizens [14].

This global quantitative accounting can be refined by a local and qualitative analysis. Political intervention destroys riches, that is easy to observe. But political intervention doesn't destroy in a uniform way: it serves the ends of some people, those who will decide of the use of the confiscated resources, and it repels the ends of other people, those who will pay the bill of political intervention. It makes some people richer, the exploiters, and its makes some people poorer, the exploitees. And that is the very reason why the exploiters, who benefit from it, seek to continue this exploitation, and to have the exploitees believe they are on the right side of the exploitation, or that they may be accepted in it if only they cooperate. By serving some ends and repelling other ends, political intervention will also disturb the priorities of human activities: the ends of exploiters will be privileged, the perverse pleasures of their idle class will be favored, the warrior morality of the parasites will be exalted, the means of their oppression will be developed. On the contrary, the ends of the exploitees will be disregarded, the sane pleasures related to productive self-enhancement will be ridiculed, the peaceful morality of the entrepreneurs will be loathed, the means of creation will be abandoned.

8 Research Corrupted

Let's examine once again the effect of Government intervention on research, from the point of view of economic reasoning.

First, let us consider the case of the TGV (french high-speed train), the Concorde (french supersonic passenger plane), and of other costly researches that are allegedly justified by their direct utilitarian consequences. Either one of the two following affirmation holds. If the TGV isn't profitable [15], then it would be a good thing that it should not have been developed. And if the TGV is actually profitable, then private capitals will without any doubt be in competition to be first to develop and exploit it. Of course, the massive subsidies from Government to automobile drivers, through the relentless construction of roads, plays a large role in the relative lack of profitability of rail transportation. In short — if French people were truly free to fund the means of transportation they prefer, the result would be a profitable combination of means of transportation.

In the same vein, regarding space conquest: it is a cause that has had supporters since the end of the XIXth century. It isn't possible to say at which date a man would have walked on the moon without the intervention of the american government. Most probably, it would be some date later than 1969; maybe the american civil society, aided with foreign donations, would have voluntarily subscribed to this project amounts of money comparable to those that were levied by force upon it; in that case, an american or another westerner would have walked on the moon by 1974 or 1979 rather than 1969[16]; and even were it to happen in 1999 or in 2019, this delay is nothing, in comparison to the respect of individual rights; and that respect also means that resources that were confiscated during the race to the moon would have been used to actually and durably enhance the life of men on earth. In place of that, hundreds of billions have been taken by force and spent so as to send a happy few privileged persons spend vacations in space at the expense of the taxpayer. Actually, in the long run, governmental space agencies (NASA, ESA, etc.) are the greatest brakes to space conquest: their disastrous budget management, the monopoly by which they prevent the emergence of different approaches to space conquest, and even the emergence of different goals to this conquest — it all contributes to the useless dissipation of resources that society is ready to invest in spatial research. In these administrations as well as in other ones, nepotism, corporatism, bureaucracy, irresponsibility, converge into the annihilation of the most beautiful dreams of mankind.

In vain, some will conjure the ``positive externalities´´ of governmental space conquest: all the discoveries that are by-products of research, the industrial applications of initially military and frivolous processes, etc. For economic calculation reminds us that the activities that were prevented by the State intervention would have had no less positive externalities, useful by-products, and various applications, in addition to their direct beneficial effects. It may so happen, and it is even certain, that these secondary beneficial effects would have been different from those of governmental research in space conquest — even though this difference in the end could be mainly but a difference in details and calendar. But there is no justification in claiming that those beneficial effects would be in any way lesser than those of government intervention. In fact, with the rapid increase in prosperity due to the absence of political intervention, an according increase in beneficial side-effects must be expected, out of the general progress of civilization.

In conclusion, we will recall that public research is always done at the expense of other, private, spendings. And this other spendings, by definition, would have had more benefits in the very opinion of those people who had to be forced to contribute against their will to the political intervention. Political intervention, far from being useful to research, is deeply harmful to it. In the domain of research like everywhere else, the best civil services are private services, or more exactly, free services traded on a voluntary basis, as opposed to compulsory services imposed by the coercive ways of political intervention.

9 Political ``Efficiency´´

In the above-mentionned discussion, a statist went to support the State's monopoly on research, with many arguments that are as common as they were false, and that are thus worth a thorough analysis.

Here is one of his arguments, dispensed in a ironic tone: ``Why keep two labs up, for the same study at the same time, instead we could make them work together and advance twice faster?´´ However, the answer is easy. Why demand that they should work together, if this isn't the arrangement they enter naturally and voluntarily? It is never good to put all of one's eggs in the same basket, and that is even truer in the domain of research, where by definition it is never known beforehand which approach will lead to solutions, hence the famous jest ``people who research we find easily but we're still researching for people who find´´ [17]. If, in a free world, some people decide to fund some researches on a same subject along different paths, it's because they each think that their own path is marginally the most promising one. Why should these people be forced to fund only one laboratory? Public monopoly in research implies that methods will become rigid. When the monopoly is complete, the bureaucrats who climb the power ladder, like Lyssenko, can impose their ``official scientific truth´´; then all serious researches are halted, and funded research endeavours are massively led into dead-ends, except for the resources allotted to a rare few brave and upright scientists who will manage to smuggle them away from their official destination [18]. Even if monopoly on research is only partial, even if political intervention is lowered, there will still emerge typical structures from a culture of Political Power: nepotism, and a class of bureaucratic elite. Then, with each member of each committee coopting fellows, electing former students, subsidizing friends, promoting colleagues, all research tracks get filled with people having the same methods, the same paradigms, the same train of thoughts, the same prejudices, the same corporate interests [19]. Hence, the scientific psycho-diversity decreases and disappears all the faster as political intervention increases and gets more durable.

It is interesting to note that this claim of a speed gain through concentration is but a rehash of the communist theses according to which collectivization brings benefits of scale by factoring out redundant fixed costs. But in the case of research, as other domains, this is but a materialistic illusion that completely neglects information costs [20]. For the decisions to be taken are not written; they can't be decided out of objective criteria. The cost of obtaining an informed majority on any given question is extremely high, and the cost of achieving a consensus is incommensurably higher even; The cost of an erroneous decision as applies to an entire country due to a monopoly are not any lower, — and in the absence of competition to compare with, whoever manages the monopoly has no compass, and will inevitabily head into error. Therefore, when details are considered, a monopoly has no possible claim to any ``popular will´´, nor to any ``informed choice´´ nor to any ``empirical truth´´. There is nothing but a tyranny of politicians, bureaucrats and lobbies upon the public, victim of the monopoly. And those tyrants, whom their monopoly make unable to distinguish where lies the interest of the public, can identify perfectly, where lies their own interest, and the interest of their courtiers, friends, minions, etc. [21]. Thus, in a way, monopolies do promote some kind of efficiency: the efficiency of the tyrants able to seize most power, through intrigues, demagoguery, ruthlessness, utter lack of scruples, with self-satisfaction and self-righteous haughtiness.

10 Monopolist ``sharing´´

Another argument of the monopolist was the sharing of results: according to him, public research would allow to share results between everyone, whereas private research would lead to a partitioning of knowledge. As usual, this argument is based on a lot of confusions, that we'll have to unmangle before we can debunk it.

To begin with, let's assume a complete public monopoly on research, as the statists longs for. In such a case of monopoly, would knowledge really be shared? Such an affirmation stems directly from statist mysticism: The ``public´´ nature of research is worshipped, which in actuality means that it be in the hands of politicians, on the ground that these politicians are meant to act in the name of the people, of God, or any other official reason, dogmatically accepted as legitimate [22]. Now, with a monopoly on research, by definition of a monopoly, the monopolists are the only ones who are entitled to use the monopolized knowledge for further research. Those who would try to use these informations outside of the monopoly would have no public funding, but instead endless judicial and administrative trouble if they were to try and find private funding for such research; they are forbidden to do their research but on their own, funding themselves with a day job, being relegated to the fringe of amateur work on projects that require very little capital investment. In fact, ``the people´´ is more effectively excluded from research with a public monopoly than with a private monopoly.

The principle of evil lies in monopoly. It is a delusion to seek a remedy to this evil in a government monopoly, which consists in the concentrating and aggravating this monopoly. However, such is the principle of socialism and statism: statists think of monopoly as a given, and go on to deduce that it must be as concentrated as possible. On the contrary, not only there doesn't need be a monopoly, but if there were to be monopolies, it would be much better that each of them should they be as weak as possible, instead of being able to impose its will upon everyone and everything. It's better that those monopolies should be revokable and subject to cancellation, rather than being protected by laws enacted by the very people who profit from this monopoly.

Let us now rebuke the argument according to which private research would be based on the exclusion of the public from access to knowledge. Clearly, the freedom to engage in research on whatever subject one wants, and the freedom to share the results with the colleagues one chooses do not imply any exclusion [23]. Instead, exclusion happens only when these freedoms are breached into by various taxes, regulations, prohibitions, subventions, who favour the ones, and prohibit, constrain and punish the others. Now, these freedoms are indeed breached into nowadays, and to the benefit of private companies, to which the State grants a privilege called ``intellectual property´´: with the grant of a patent, of a copyright, of a secret, of a trademark, private or public compagnies can claim the help of public force to quell down competition from people who would use the same knowledge and information as they do. Those ``intellectual property´´ ``rights´´ are a kind of information protectionism through which governments grant privileges to industrialists and publishers (actually, to their legal departements), by the legal exclusion of their competition. [24].

Those legal monopolies are now the greatest hindrance to free dissemination of knowledge. ``But,´´ joyfully go the statists, ``intellectual property does profit to private companies, doesn't it? It is private lobbies requesting them from politicians!´´ Once again, statists haven't understood that the principle of racket lies in the nature of politics, and that the question that matters isn't the accounting distinction between ``public´´ and ``private´´, but the economical distinction between politics and liberty.

11 Politics vs Liberty

The distinction between ``public´´ and ``private´´ is an accounting distinction: it consists in asking ``Does the signature that corresponds to this accounting line belong to a government officer or to a civilian?´´ I.e. was this transaction blessed by a blue ribbon or an official stamp? This distinction is irrelevant from an economical point of view. The economically relevant distinction is between ``political´´ vs ``free´´: were the participants in this transaction willing, or was the will of the ones forced upon the involuntary others? If all were willing, then the transaction is free. If the ones have imposed their will upon the others, then these ones have used their political power.

Those who live directly or indirectly out of legal privileges, out of government violence, have no need whatsoever of a document stamped ``civil servant´´ to be political parasites. Feudal lords and highwaymen didn't pretend to serve the public and didn't invoke any official license to commit their political robberies. There are thus private companies, associations, trade unions, entrepreneurs, employed and even unemployed people who live out of political parasitism.

Conversely, not all civil servants are political parasites. Most civil servants and most employees of privileged companies suffer more than other people from legal monopolies: not only do they suffer as consumers themselves, but the monopoly prevents them from finding elsewhere a job that matches their skills they have for the activity being ``protected´´ by a legal privilege. Even most unemployed people, who are maintained in their precarious situation by a legislation that destroys jobs, housings and food, are from an economical point of view the victims of the system, even though from an accounting point of view, they owe everything to public aids.

The question is to determine whether some parasites owe their income to the use of political violence — which income then implies the impoverishment of the rest of the population to their benefit [25]. Patent holders are political exploiters, and so are the holders of official franchises and licenses awarded by various ``regulating´´ institutions, holders of exploitation licenses for a public monopoly, etc. Politicians, high-ranked civil ``servants´´, trade unionists, managers of government-owned companies, government contractors, managers of subsidized associations, etc., are all exploiters [26]. All of them owe a surplus of their income and of their own freedom to legal coercion, to the oppression of citizens, consumers, taxpayers, who are forced to abide willing or not by the whims of these privileged few.

To determine whether a person is verily an exploiter or an exploitee, we should ask one question: Would this person be payed as much or more by freely consenting people to whom this person would render the same kind of services? If the answer is ``no´´, then this person is a political exploiter. If the answer is ``yes´´, then this person is being exploited. Thus, without the government monoply on agriculture, most of the ``civil servants´´ working in North-Korean sovkhozes would still be farmers and would make a better living; and in North Korea, were everybody is a ``civil servant´´, the huge majority is made of slaves owned by the Communist Party. Without a government monopoly on research, those many researchers in public laboratories who are not crooks would also still be researchers, and they would be able to fulfill their calling while getting a better paycheck.

Of course, so as to perpetuate itself, political exploitation will make full use of the accounting fallacy to persuade its victims that they benefit from the system. Thus, victims themselves will participate in the oppression, and will protect the privileges they're suffering from from being revoked. Politicians will try and generalize the welfare State, through which everyone must give a growing share of one's income to the State, while depending more and more on aids, subsidies, privileges, tax cuts, etc., granted by the State; and then there are the wages of civil servants, public contracts, that combine with the fact that everybody will have in his family, among his friends or within his social circle civil servants, people living off the dole, and other people depending on government funds. Hence, Government takes (inequally) on its citizens a growing share of their income, to redistribute (inequally) a part of this income to everyone, on the condition that they should satisfy the requirements of Government. Now, to take everything — by force — and give back a part — to those who obey — is not to gift — it is to enslave. Likewise, to take some — by force, — and to give back a fraction — to those who obey, — is not to gift, — it is to enslave part-time. Thus, political intervention is nothing else but the modern form of enslavement. Or more exactly, enslavement is an ancient and gross form of political exploitation, and part-time enslavement by a social-democratic welfare State is a modern and sophisticated form of same enslavement.

12 False Charity

Statists, and particularly Socialists among them, often invoke feelings to justify the seizure of research by politicians. According to them, research on AIDS, on cancer, on this or that rare disease, etc., would be acts of ``solidarity´´ impossible without government intervention. [27]. There again implicitly prevails the accounting fallacy. For the relevant question, the economical question, is to determine whether ``thanks to´´ political intervention, there will have been more rather than less charity, and whether charity is purer or more corrupted with or without political intervention.

The media hype about the ``necessity´´ and the ``benefits´´ of this or that government research endeavour is but a lure. Why should anyone rejoice at millions being spent in research about a given hyped diseased (AIDS or a rare disease touching children), when these millions are as many millions that are not being spent in other research endeavours that are not any less ``necessary´´ and ``beneficial´´? AIDS research does not deserve any preferential treatment, when many diseases cause more deaths in the world, and cost less to fight, like malaria. It is up to each individual to establish his own priorities as to his own marginal action. If medical research were funded through donations, health insurance, etc., it would spend in fair proportions on diseases that are really important according to those who care.

In France, the private funding of associations (not counting gift in time and in nature) amounts to 46% of the budget of these associations. If the French people, without being robbed of 60% (in the average) of their revenues by the Government, should give the same proportion of their income to associations, they would be better funded. Now, the experience of freer countries, where taxes are lower, is that individuals give in the average a bigger part of their income to charities. This phenomenon is easy to explain: on the one hand, free individuals feel more responsibility than people whose responsibilities are confiscated and taken over by the State, and on the other hand, individuals made prosperous by freedom can give more easily, and at the same time feel more harshly the contrast of the misfortunes of others. Finally, amongst associations, the real free associations, that are actually supported by the people, would be better funded, for all the false parasitic ``associations´´ would disappear that are as many ways by which the fruits of political plunder are privatized through a variety of subsidies.

Some statists, who value democracy, pride themselves on a popular support for their policies. To these statists we can reply that if really most people want to fund this or that research endeavour for a given amount, then the easiest way to achieve it is to leave people free to fund it, and that any political intervention is but a denial of this popular will. Other statists, on the other hand, despise democracy, and claim that ``people´´ are not good enough, mature enough, responsible enough, charitable enough, altruistic enough, etc., to handle such things, and that a political elite must manage this charity. To these statists, we will demand that they should exhibit and justify the titles of nobility by which they extract themselves above the masses they claim to rule [28]. All of them assume that the State magically generates a surge of charity, of justice, or creativity, etc., that doesn't have its source in society, but that descends from the sacred blessing of Power upon the passive masses. Now, if this surge of charity, of justice, or creativity, etc., already exists in men, then it will express itself all the better without political intervention. And if it doesn't exist, then from where will a government made of humans, governing in the name of humans, make it spring?

The question isn't about trusting or distrusting an abstract notion of ``people´´, who would be good or bad, mature or immature, etc. The question is about whether politicians are better than other people, about whether the political system of coercion of the weak by the strong favors the emergence of the good or the bad. The question is about finding out which rules of social interaction are better fit between rules based upon individual liberty and individual responsibility (i.e. upon the principle or individual property and restitutive justice), and rules based upon coercion and generalized irresponsibility (i.e. upon the principle of political power and penal justice).

Now, the way collective choices emerge [29] in presence of rules of political coercion have been brilliantly studied by James Buchanan and Gordon Tullock in their Public Choice Theory, where they took special interest in the case of democracy (which earned Buchanan the Nobel Prize in Economics). And with a very elementary calculus, it can be demonstrated that under the pretense of ``solidarity´´, it is lobbies that get rich to the detriment of the taxpayer, in a con game where each time, new measures are voted that have limited benefits focused on a narrow group that has a marginally high power of political decision at a given moment, while causing an immense nuisance but a nuisance that is diluted on the vaste majority of people and stretched in time.

13 Qualitative Effects

The effects of monopoly, of coercion, of political intervention, are not only quantitative. They are first and foremost qualitative. When the liberty of the ones is denied, and when the responsibility of the others is rejected, the consequences are not only a transfer of wealth from the exploitees to the exploiters, but a transformation of all activities, with the appearance of concepts specific to political intervention, and even of a political ``morality´´.

The system of government-controlled ``public´´ research is based upon the irresponsability of researchers regarding the utility of their research, as understood by those who would be ready to fund them voluntarily. Not only are researchers disconnected from the rest of civil society, they are also subjected to a bureaucracy managed by mandarins; and they are prevented by extremely heaved regulations from using the means they have toward practical applications, or from cooperating with those who have the right and the means to do it. Researchers will thus focus on some research endeavours rather than others: research endeavours that do not have applications and that do not generate administrative complexities; research endeavours that are specifically designed to please to political decision-makers; research endeavours that please their own authors, or to each other member of a group of ``experts´´, but that otherwise lack any public. In the climate of severance between the privileged ``public´´ researchers and the public of ``private´´ users, even potentially useful research endeavours are sacrificed because the dialogue between these two estranged worlds is difficult; because the applicative proficiencies of public researchers and the theoretical proficiencies of private developers are blunted; because administrative and legal barriers, and in particular all of ``intellectual property´´ are hampering the transfer of knowledge, and are encouraging strategies of partitioning.

In a society where reigns freedom, there is a continuity among fields of knowledge, and every human undertaking is verily a research of the means to enhance one's and other people's living conditions: to enhance the means of production and consumership, not just in a material way, but in a spiritual, personal and subjective way, that comprises anything that can make things better. The intervention of politics in research, by contrast, introduces a dichotomy among fields of knowledge, between subdsidized fields and fields that are not subsidized (or that are even prohibited). The former will be the empire of monopoly, forsaken by the ``private sector´´ facing the unlawful competition of the ``public sector´´; or they will be the hunting grounds of companies holding ``intellectual property´´ privileges. The latter will be the business of the free activity of citizens, as long as they will avoid the barriers surrounding the reserved domains of public and private legal monopolies. Hence, in the same way that political accounting introduces a fiscal distinction between ``public´´ and ``private´´ spending, political control of research introduces a regulatory barrier between ``public´´ fields of knowledge reserved to the State monopoly, and ``private´´ fields of knowledge open to citizens [30].

The contents of research, and more generally the object of human activities, is thus greatly affected by political intervention. But this disturbance doesn't consist solely in the inefficacy introduced in the natural interrelationships between humans, the hurdles raised against their commucation and their cooperation, etc. It also consists, and in a much more vicious way, in systematic biases toward efficacy in pursuing a new kind of goals: political goals. Political control upon research has efficiently led to the development of weapons of mass destruction, of means to control populations and individuals, of means of entertainment and propaganda, of techniques of brain-washing and habituation to political fallacies, of cover theories serving as pretenses for political intervention, etc. Under the control of politics, research, like all human activities, will be diverted to the service of the political anti-morality of parasitism and war, rather than to be used economic morality of co-operation and creation.

14 The Long Run

Our statist claimed that in the big private corporation in which he was working, he only ever saw very short term activities. Here is an accounting affirmation that I am readily prone to admit. However, the same statist was using this affirmation as an argument in favor of public funding of research. And this is again an instance of the accounting fallacy, whereby he claims to reach an economic conclusion out of accounting data. Is it true that in a free society, individuals will only freely organize in the short term? Not at all.

Firstly, it is a good thing that most individuals should feel more concern about the short term than about the long run. The hypothetical long run is undoubtedly worth less than the certain present — as says the popular wisdom, ``a bird in the hand is worth two in the bush´´. Indeed the long run won't even exist if a catastrophe happens that destroys civilization in the short term. Actually, the remoter the times, and quite legitimately, the more indifferent we are to these times. Secondly, events in the long run being consequences of all the events taking place between now and then, the study of them becomes more complex as their term gets more remote in time. To understand the long-term implications of our choices requires a great investment in capital, mostly human capital, for a marginal return that goes shrinking. Not everyone has the ability to usefully project oneself on the long run; it is an ability that like all other abilities requires particular affinities and a proper specialization. It is thus a good thing that any random guy shouldn't try to further his ignorant opinions on the topic, all the less through political coercion. That human organizations should care more for the short run than for the long run, is a sane thing. That doesn't mean that no one cares about the long term. It means that the activity of thinking about the long term is a specialized activity and that it is normal and sane that there should be organizations dedicated to this long term activity (research centers, investment funds, etc.) whereas most people should give little if any attention to such topics.

Then, when government monopolizes the money and talents destined to long term research, the necessary consequence is that the same money and talents will be lacking somewhere else. Therefore, any government-funded ``public´´ research has the opportunity cost of both the material and intellectual means of private research and the free and responsible organization of said research. We saw in the previous sections how this translates into a sclerosis in methods, the subjection of scientists, and a diversion of the very objectives of research.

Finally, the main barrier to long term investment (whether through research or not) is precisely the encroachment of legislation on private property, and the legal risk of future usurpations. When investments are burdened with taxes, when the use of profits is heavily regulated, when new legislation is regularly enacted in a socialist perspective, when successful companies are nationalized or suffer from an increased fiscal and judicial pressure, whereas those that experience short term difficulties benefit from a lot of ``aids´´ and exonerations, then long term investment is deterred. What makes it worse is that legal risk is not an insurable risk: it isn't possible to be guarded against future laws, to foresee the extent of future legal plunder, or to pool resources to statistically compensate losses. The only means for a company to put a limit to political plunder is to engage into lobbying politicians: to accept to spend money to court them, so as not to be taken unprepared by future decisions. In other words, this only means is to enter the game of the political racket, and to participate in the rush for the spoils, so as not to be their most complete victim, and to become a plunderer as much as and more than a victim of the plunder.

So that individuals may take long term decisions, liberty and responsibility of the committed resources must be preserved over the same long term; the individual property upon said resources must be guaranteed to the owners and to the heirs to whom they will transmit their ownership (descendents, foundations, etc.). The long term solution to problems is the long term respect of property rights, including the right of bequest (i.e. the right to freely bequeath the entirety of one's property to whomever one wills, without Government confiscating any fraction of it).

15 The Case Of Computers

The accounting fallacy is used to credit american military funding and Government intervention in general with the invention and the development of computers, of the Internet, etc. Now, it so happens that the invention of the computer largely precedes any military funding of it — and indeed, how could the military ever have issued any grant to fund a kind of invention the idea of which wouldn't have existed yet? Did computer science spring forth fully armed from the aching forehead of some non-commissioned officer between two barkings of orders at his recruits? Charles Babbage had launched the idea of computers as early as in the XIXth century, and in the 1930s, a whole lot of research teams, without any military funding, had tackled the fundamental principles of computer science, in theory (Gödel, Turing, Church, Curry, etc.), as well as in practice (Vannevar Bush at MIT, Atanasoff and Berry at Iowa State University, Konrad Zuse in Germany, etc.). In short, the first computers did exist and computer science was heading toward success long before the military ever heard of it. And computer companies never lacked profitable civilian applications: statistics, accounting, engineering, scientific research, etc.

Therefore, if the same billions hadn't been spent by the military, there would still be computers. Statists may claim in vain that military purchases did reduce production costs by increasing volumes, these purchases will also have increased prices by inflating demand; in short, they will have patronized their suppliers without having the least supported civilian uses of computers. On the contrary, by the very nature of any government spending, political intervention in the domain of military computing was done by a displacement of resources to the detriment of peaceful and creative civilian activities. In the end, shell trajectories will have been computed, as well as secret codes, but there will have been a brake to progress in all other activities — agriculture, industry, medicine, education, etc., all the peaceful and creative activities, including civilian computing, — that measures up to the resources that will have been mobilized to finance this military computing activity. Such is the opportunity cost of government-based military research. Was this research useful? Maybe. But in this case, why not let those citizens who are convinced that it is fund this research by themselves, voluntarily? Majority or minority, they have the right to fund it, but they do not have the right to force anyone else to fund it.

As things would have gone, the chronology of discoveries would undoubtly have been different without government intervention: some discoveries would have happened later, other discoveries would have happened earlier. With military funding, the military applications will have been relatively hastened (is that a good thing?), whereas civilian applications will have been relatively postponed (i.e. everything that makes computing something useful to us civilians rather than to the cutthroats at the order of politicians). Even if computer science would have been delayed by three years by lack of political intervention, why not after all? It must be recognized that to this ``delay´´, by assumption, there would correspond a increased generalized welfare in global population.

Lastly, there isn't but one path to computer discovery. Without government intervention, the discoveries would have been different. Instead of computing behemoths, inherited from direct government funding, there would be smaller and more versatile systems; instead of a regressive movement of technology among the public ``received from above in lesser forms´´, there would have been a progressive movement ``growing from below in ever better forms´´; instead of partitioned systems designed to enforce barriers of intellectual property, there would be open systems, designed to provide for efficient cooperative work. In short, government intervention is bad not only from a quantitative point of view, but also and most importantly from a qualitative point of view. Money can't buy happiness; it can't buy good computer science either. Money is a tool, the way to spend it is essential in achieving a good result. Direct and indirect intervention by government in the domain of computing, through public funding of research or through intellectual property, may increase many-fold the amount being spent all the while having a disastrous effect on the quality of produced software and hardware: increased input and decreased output. Such has always been the principle of political intervention in the economy [31].

16 Conclusion: Fighting Fallacies

In France, where the State rules national education and university, economic reasoning is systematically censored. The vast majority of State-sanctioned ``economists´´ are econometricians who would only know accounting reasoning. Marxists and keynesians among them control the teaching curricula, the selection of new teachers, the tracks to promotion, the networks of ``experts´´, the media, etc. Therefore, it is not surprising that even educated people, endowed with a critical mind, would have the reflex of using accounting reasoning, though it may be fallacious.

Actually, the longer they will have been ``educated´´ by the totalitarian brain-washing machine that is national education, the more prestigious their diplomas and the higher-ranked they are in the State apparatus of privilege-granting, and the more they will support the fallacies upon which is based all the ``One Way Of Thinking´´ of socialists and statists [32]. And this is how the Establishment warrants the support of all the moral and intellectual ``authorities´´.

Though they face the adversity of all the united political forces, libertarians nonetheless have a faithful ally, upon which they can rest with full confidence: the innate common sense of every individual when his interests are at stake. For the real world doesn't give a damn about the fallacies of the statists, and when all things are said, it is out of his economic calculations, and not out of his accounting calculations that each one may further his interest and his happiness.


Notes

[1]: Notice how socialists reject the word ``sale´´ by claiming that ``education is not a merchandise´´ — which is but clever trick to arrest thought about the transaction taking effect, and to thus fool the masses.

[2]: On the fundamental principles of salaried work, read by Bastiat, Wages, and by Pascal Salin, The Firm In A Free Society.

[3]: However, monarchy has problems of its own: First, it may work on the long term, but to the benefit of the reigning dynasty, that needn't be a priori coincide in its details with the benefit of the subjects or whomever else — even though thriving and happy subjects can be taxed more easily and more heavily than starving and angry subjects. Then, monarchy creates a single point-of-failure in the person of the monarch, upon whom is concentrated all the political lobbying, all the power vertigo, all the weight of responsibilities, all the demand in proficiency, etc. Whenever the monarch yields to his courtiers, to the folly of grandeurs, to the drain of obligations, or to the difficulty of the task, all of his subjects will suffer. Finally, monarchy raises serious problems with succession: genetical problems for hereditary successions (endogamy in reigning families has had disastrous results — degeneration, haemophilia, etc.), problems of educating whomever is to succeed, problems when the king or his heir educated as a king dies without any properly educated substitute being found (see the end of the ``five good emperors´´ in Rome), etc.

Notice how many of these problems with monarchy are problems inherent with any political power: any person who holds a power of coercion upon others will be in the position of the monarch as far as this power is concerned. And the more extended this power, the more dramatic importance these problems will become.

[4]: See my article Public Goods Fallacies.

[5]: These studies were only marginally free of charge. It is clear that someone is paying — and that globally there is a transfer from those who didn't study to me. But it is also clear that some opportunities were closed to me: if some career was relatively facilitated, other careers were relatively made more difficult. And considering the limitation inherent to resources at any moment, it is clear that some careers were absolutely closed to me or to someone else so that this education could be offered to me. Finally, it isn't clear a priori whether I won anything in this operation. On the one hand, I may pay more taxes afterwards than I would have paid in monthly dues for a loan that would have financed equivalent studies. On the other hand, the careers that were closed to me by government intervention could have brought me greater satisfactions. In short, ``freeness´´ has a very restricted meaning, just like for ``free´´ perks you get when purchasing a car in sales promotion — except that I never got the choice to not be a customer of the State, only the choice to accept or refuse the ``free´´ perk (and only after I was 16 years old).

[6]: Such is indeed the very definition of a totalitarian State: a State that gets involved in everything, that controls everything, that does everything for you — and for which you do everything.

[7]: Note that accounting calculation can serve as a tool to decompose an economic calculation between independent sub-calculations, assuming the decomposition of an action into independent factors. But in such a case, the accounting calculation, far from substituting to the economic calculation, is a tentative factorization that is only meaningful as part of a prospective economic calculation: assuming a given decomposition of an activity into various components, is it possible to easily detect that said component activity costs too much as compared to what happens elsewhere or to what we imagine could be achieved with a given effort, in such a way that it could be replaced by a cheaper substitute or otherwise enhanced? And even as a tool for economic calculation, the decomposition that underlies an accounting calculation isn't absolute and incontestable, but is itself subject to economic calculation: can a refactorization that modifies the attribution of tasks help reorganize the activity in a way deemed to be more efficient?

We conspicuously do not want to dismiss the relevance of any accounting calculation — there are good reasons why such calculations appeared and were perfected throughout millenia. What we denounce is the fallacy that consists in evicting economic calculation as such behind a veil of smoke out of which only emerges the accounting calculation, whereas it is but one step of it (albeit sometimes a useful one), and a step that specifically excludes the essence of economic calculation. For the essence of economic calculation is: the comparison between the consequences of several possible alternatives.

[8]: Some people are filled with an anti-intellectual scorn at any reasoning that involves counterfactuals in past events; but they cannot avoid the necessity to undertake reasoning involving counterfactuals concerning future events: the question of determining what to do? today and what to do? tomorrow cannot be solved without counter-factual analysis. In the end, every decision taken today can only be based upon ideas, principles, abstractions: by definition, future facts are unknown; and past facts themselves are known but through assimilation and subjective interpretation. Thus, the alleged arguments against ``theory´´, against ``lofty principles´´ and for ``practice´´ are but fallacious arguments for some particular practices that do not depend any the less on some theories and on some not-so-lofty principles; they are arguments to defend the indefensible by suppressing reason.

There is an important consequence to the fact that each single decision of each of our lives is taken based upon speculations, upon conjectures, upon partial information, upon an evaluation of possible futures, upon hypotheses that are impossible to check directly because they concern counterfactual futures, upon guesses that may be more of less educated but that are always uncertain as to the best choice among possible futures. This consequence is that in a deep sense, every man is an entrepreneur, and every life is an enterprise: it isn't possible to justify our actions with a ghost of absolute objective knowledge; fundamentally, we can act and commit the resource at our reach but through personal convictions.

That is why the notions of liberty and responsibility are essential in any system of law: if whoever creates some resources is deprived from the liberty of choosing how to spend them, whereas someone else choses the destination of some resources he didn't create without being liable for it, then the ones have been reduced to a state of subjection to the others. For in the end, the resources seized by force or fraud upon the ones will have served to satisfy the personal choices of the others, without any possible claim of serving an absolute good. The coincidence between liberty of choice and responsibility of acts is nothing else but property rights.

[9]: Without the incitation to quantity and then to quotas, without the nationalization of pollution, the current intensive and polluting agriculture would doubtlessly be replaced by a cleaner agriculture, ``biological´´, with less pollutants, etc. Instead of overproducing useless foodstuff, other produces would be grown: products that are currently considered as luxury, or maybe green fuel. And if ever it isn't profitable to grow anything on a given piece of soil, then this ground will be destined to something else than agriculture: a wild-life reserve, inhabitations that offer more space to men, fields of windmills, etc. One can attempt guesses at the way current agricultural grounds would be used in absence of the CAP, but these will ever remain but conjectures, by definition. The actual uses would be ultimately determined by the imagination and preferences of those people who are ready to commit the fruits of their past and future labor in the actual arrangement of said grounds.

[10]: François Guillaumat, by symmetry, calls this one-sided accounting an anti-accounting fallacy.

[11]: The other side of the coin, that is never talked about, also contains all the useful actions that were prevented by the established monopolies and regulations, and here again, the political fraud will strive to cast dishonor upon these actions, to claim that he knows best than the involved people what is best for them, unless he simply confiscates everyone's individual liberties in the name of an elusive common good.

[12]: Note that the word profitable as used above doesn't mean anything else but the fact that the involved people find that the satisfactions they receive out of use of the engaged resources is worth the sacrifice of said invested resources, as compared to any other use of same resources. Not only don't these satisfactions need to be monetary, but ultimately, satisfactions are never monetary — one doesn't clothe in gold, or eat money. The economicist delirium of state advocates, their paranoia in accusing others of what is their own defect, do not change anything about the matter. In the end, what the state adocates claim, is that a politician is a better judge than the citizens of the value of all these non-measurable satisfactions, so that he may compute a macroeconomic average, and take decisions based on such calculations. Really, the satisfactions that are considered, and that include taking the time to do things, developing human relationships, etc., are satisfactions that are eminently personal, and no politician can judge in behalf of any citizen what these satisfactions are worth and which to sacrifice in exchange of what alleged ``common good´´. Once again, the only humanistic stance is the libertarian stance: That every individual should be free to choose which priorities to give to which satisfactions considering the limitated available resources.

[13]: For a more thorough study of this phenomenon that Bastiat called the ``double incidence of the loss´´, see our later article on The Law of Bitur-Camember.

[14]: Thus, from the economic point of view, when administrative intricacies prevent enterprises from being created, all the riches and satisfactions that these enterprises cannot produce are destroyed by governmental intervention; politicians do not make any direct profit out of this destruction, and are vandals rather than robbers, in this respect. Of course, they are also robbers, when they grab the reduced riches produced with their intervention. Moreover, these two aspects, though it can be attempted to account for them separately, cannot be completely divorced: vandalism and robbery are related, and can be grouped under the notion of attempt against property rights.

[15]: See in a previous footnote the meaning to be conferred to the term ``profitable´´.

[16]: Or on the contrary, without States to wage wars, conduct genocides and cause mass destruction, and to impoverish the people with prohibitions, restrictions and regulations, civil society would have been much more prosperous and could have afforded itself to accomplish such dreams much earlier.

[17]: Actually, as we have seen it in an earlier note, this fundamental uncertainty is of the essence of any and all knowledge about our universe, and not the exclusivity of scientific knowledge. That's precisely why any human action is a research of the ways to improve our life. All in all, any pretense to name one adventure as ``research´´ while excluding other endeavours, is but an argument of authority to impose the tyranny of technocrats upon those who have to give up their own research so as to fund on their own earnings another person's research.

To read about these ideas in a larger scale, consult works of libertarian epistemology, including texts from Ludwig von Mises, Murray Rothbard, Ayn Rand, Hans Herman Hoppe, or François Guillaumat. My own contribution to the domain of epistemology is available in section 5 of my article Government is the Rule of Black Magic.

[18]: Happily, except in the case of closed countries as completely isolated as the very worst communist dictatorship, international competition with foreign research makes it more difficult for official scientists to spew their inane drivel: if they make themselves so ridiculous that this would taint their superior, they might face the fate they promise to their dissenting colleagues. Now, concentrating research into continental monopolies decreases competition; The worst that could happen, which would cause the growth and sprawl of Lyssenko-type phenomena, would be concentrating research on a global scale, in UN hands. Once again, the individual freedom to dissent and to do what one thinks is right, is the only rampart against the tyranny of stupidity. As soon as there exists political power, there are politically ambitious people who claw their way hell-bent right to the top, and the striking competence that distinguishes them is neither their scientific creativity, nor their probity, nor their altruism but their consuming lust for power.

[19]: Please notice that in a bureaucracy, there's no need whatsoever for any conscious intention, and even less for any explicit conspiracy, so that power should accumulate into the hands of cliques: it suffices that everybody would promote those whom one truly and whole-heartedly think are the most capable, — that is, those who think like him. Of course, in such a context, probity will play against the virtuous, since they won't be able to grow a powerful clique and they will lose all influence and all fundings to the benefit of those who have less scruples. So it's really the normal operation of a bureaucracy, and not the ``sabotage´´ of it that leads to the reign of cliques, and to the rise of an Establishment.

[20]: This illusion is all the more striking in a domain like research the purpose of which is precisely and exclusively the production of information! However, the production and use of information is a topic that matters in the whole span of human activities, and the regulation of the flow of information is precisely one of the natural outcomes when applying the rules of a free market, as opposed to political ``regulation´´, that actually deregulates and brings chaos.

When they are free, humans can compare and dynamically ajust their expectations and behaviors to the expectations and behaviors of other people. When ones are at mercy of others, masters don't have either enough information to make a discriminate use of their subjects' precise and dynamic aptitudes, nor enough information to act discriminately in their subjects' precise and dynamic interests (should they care the least about it). Even if they were selfless, masters are incompetent in helping their servants. Moreover, these servants would resent them whatever they do, be it good or bad, because the oppression and deprivation of their freedom is the very evil they suffer from; as for the choices they're not allowed to make, the subjects learn not to care about these choices anymore, so as to adapt and not get depressed; instead they focus their interest on whatever freedom remains to them. All the while, powerlust will attract into the race for power the most ambitious and least scrupulous people, at the cost of ruining the lives of anyone on their path or under their power.

F.A. Hayek, in his works, has considerably developped the cybernetic point of view on society, in terms of discovery and use of information by individuals. See for instance his article The Use of Knowledge in Society, or specifically about relationships of political power, his book The Road To Serfdom.

[21]: In such a situation where political intervention is ubiquitous, each administrator, each citizen, each potential grantee of government subsidies, does what he can to save the resources in his reach from the institutional disaster, by scavenging them away for one's own profit, both taking part in the disaster and trying to recover something out of it. It's quite hard to tell which behavior is the most moral or most immoral: to let obtainable resources be destroyed by the system, or to grab them toward a useful end (for oneself at least) before they vanish in the waste of institutional workings. What can be said for sure, however, is that the monopoly system is evil incarnate, and that the ones who promote it become, most often without wanting to realize it, the apostates of evil, the most immoral people that can be.

[22]: Nowadays, ``The People´´ has replaced God, but all in all, the socialist statist mysticism of Absolute Democracy out of Popular Mandate is the same as the mysticism of Absolute Monarchy out of Divine Right. See our previous article l'Étatisme, forme moderne de la magie noire (in French) and its follow-up Government is the Rule of Black Magic (in English).

[23]: Some people will argue that the choice of collaborating with a given colleague rather than another, or of communicating or refraining from communicating constitutes a de facto exclusion of all those who are thus deprived from accessing the results of the considered works. But this is a universal property of any and all human action that it should discriminate between actuality and rejected potentialities; and it is particularly vicious a fallacy to oppose this universal property to free actions when it applies just as much to coerced actions — and that the difference is the evil necessarily unleashed by coercion. Now such a double standard is typical of the double-thinking inherent in all dogmatic believers: they assume their belief to be true as an axiom, as a petition of principle, and exonerate it from having to be justified against any of the arguments they are prompt to invent against competing theories. Their ability to raise these arguments show that they are intellectually plenty developed enough; their problem is thus not a ``lack of intelligence´´, but verily a dysfunction of the conditions in which they use (or refrain from using) their intelligence — it is a mental pathology.

In any case, what interests us is the notion of de jure exclusion as opposed to this (universal thus irrelevant) notion of de facto exclusion. For more about this distinction between de jure and de facto, see for instance our article Microsoft and Government: A Libertarian View On Monopolies.

[24]: Let's note that secret, when it's not backed by legal privileges, is neither a kind of protectionism nor a kind of legal exclusion: the cost of preserving the secret falls down upon those who share it, and is distributed among them through contractual agreements of non-disclosure. Intellectual property, by comparision, makes this cost of preserving exclusivity fall upon the very people who are being excluded. This introduces a negative externality in the enforcement costs, the predictable and observable effects of which is that under a regime of ``intellectual property´´, the lobbies for the protected industries will indefinitely extend the legal restrictions to the detriment of everyone, far beyond what is either profitable to the economy at large or legitimate in the natural law. In a free society, where intellectual property privileges would not reign, there would be exactly as much secrecy as is worth effectively preserving, and not more. See for instance my notes on this conference by Ejan Mackaay (in French).

As for patents, please read my file Patents are an Economic Absurdity. The bibliography of said article's also refers to many insightful articles about copyrights.

[25]: Actually, the crucial question is to determine whether political violence occurs, and who is responsible, even though these criminals might be useful stooges who don't benefit from it, rather than exploiters who live as parasites.

[26]: David Boaz, from CATO Institute, sums up this notion pretty well: ``The fundamental class division in any society is not between rich and poor, or between farmers and city dwellers, but between tax payers and tax consumers.´´ Though the notion can be found in Bastiat, Tom Paine, and probably much earlier.

[27]: ``Solidarity´´ is the communist replacement for charity, denounced as ``bourgeois´´.

[28]: Most of these statists, while openly anti-democratic in the ideas they profess, will flock under the banner of ``democracy´´, out of demagoguery, out of conformity. It would be a mistake to accuse them of being more hypocritical than those who pride of popular will: for in the end, the ones and the others alike will in actual facts behave according to principles that negate popular will as revealed by the free actions of a free people. About true democracy, that is a democracy without politicians, read this anonymous article written in 1962, democracy with a small ``d´´.

[29]: Depending on the accepted rules of social interaction, an order will emerge from the adaptation of each individual's behaviour to these rules: the ``collective choice´´ of society will be nothing else but the result of this phenomenon of emergence. In the case of libertarian rules, where the rules respect the free and responsible choice of individuals concerning their own property, fruit of their creation, the order that will emerge will allow everyone to fulfill their potential in the respect of others, each one adapting to the expectations and behaviour of others, without any aggression being legitimated. In the case of authoritarian rules, where the rules promote the political power of the ones upon the others, the order that will emerge will not be realization of the fantasies of tyrants, but the result of the adaptation of oppressed citizens to coercion: the reaction of the subjects against authority when it opposes their individual will, their costly working around the hurdles imposed upon them by authority, their renouncement of the opportunities closed to them by authority. When all things are assessed, the final outcome of aggressive violence, which is the principle upon which ultimately resides authority, is none else than the suffering inflicted by said violence, the denial of the liberty of the subjects and the denial of the responsibility of the decision-makers.

[30]: It is remarkable how political intervention is perverting the meaning of the words ``public´´ and ``private´´, since whatever is falling under the control of the monopoly gets the name ``public´´, whereas whatever is open to the free activity of all gets the name ``private´´.

[31]: As early as in the 1840s, Frédéric Bastiat demonstrated how all protectionist interventions were based on this principle: to toil more so as to enjoy less. See for instance his article Abondance (in French), or his Economic Sophisms (translated to English).

Thus, the incidence of the intervention of the State, in research and in all other domains likewise, is to increase the amount of resources invested and to decrease the return in terms of useful results obtained, all the while violating the preferences of all concerned persons, except possibly those of the political leaders who impose theirs.

[32]: In France, leftist intellectuals often complain about the so-called ``Pensée unique´´, the One Way Of Thinking, the alleged single ideology that permeates all the Establishment, and supports the evils of Untethered Capitalism. Actually, though conformism does reign in french intellectual circles and in most media and power institutions all over of the world, this conformism is massively statist, with a definite leftist leaning: the consensus in almost all media, all educative institutions, all books, all movies, is that the welfare state is good, necessary and shall be extended, that Government is here to protect people against the wilderness of the Market, that seeking ``profit´´ is evil, that the ``rich´´ exploit the ``poor´´, that a democratic government is a magic solution to all ills, yet that democracy should be ``protected´´ against ``extremists´´, that the collective must prevail over the individual except maybe for a personal sphere that is only ever made explicit when it's irrelevant, that there is absolutely no absolute that may possibly limit government powers, except for trite things such as there being absolutely no absolute, etc. The belief that free-marketeers dominate the Establishment is part of this statist ideology that is the Establishment, and that poses as being rebellious, when it is domineering. Actually dissident discourse is thus made incomprehensible to all but the most perspicacious truth seekers, allowing the Establishment to coopt potential high-profile rebels, and to confuse most of the real opponents.


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