Wednesday, April 20, 2016

Remembering to remember - Pesach 2016

Of all the Jewish holidays that have endured through the secular revolution, Pesach may be the most popular. Jews of every shade of religious observance all over the world gather in homes to celebrate it with the traditional Pesach seder meal, during which the story of the exodus from Egypt, and the lessons to be learnt therefrom, is told.

It is curious that this rather peculiar holiday should have survived. One wonders what it is all about? We are commanded to remember. “In every generation every person is obligated to see himself as if he (himself) went out from Egypt.” Why? Because freedom is to be appreciated, savored, and guarded – never to be taken for granted. Freedom is at the core of our being. To appreciate one’s freedom is to appreciate what those who are enslaved must feel. To be a Jew who appreciates freedom is to be a Jew who treats the stranger well because the Jew was once (and again) “a stranger in a strange land.”

And so we gather, eat smooze and remember. But, although we are supposed to imagine ourselves as the liberated slaves of Egypt, in truth that is not all of it or even most of it. In celebrating Pesach we create our own valuable memories. We remember the remembering because we do it together as families and friends. We are supposed to focus on the children. They will remember the food, the songs, the warmth. And, in time, so will their children.

To the narrative of the proverbial exodus we add the family narrative. We plant roots that will sprout strong trees in every generation committed to the defense and maintenance of freedom. 

Tuesday, April 12, 2016

Socialism is a bad idea and it has killed and impoverished millions

This is addressed to my fellow professional economists, but may be of interest to some lay readers as well.

With Socialism once again respectable, Ludwig von Mises’s classic devastating critique reemerges as highly relevant. Rereading Mises’s Human Action version, two interesting points struck me.
As is well known, he isolates the-knowledge problem from the incentive-problem and focuses on the former, the impossibility of acquiring the necessary knowledge for deciding how to allocate resources to produce known ends. Such knowledge can exist only as the result of a market process.
1. The fact that *ends are given and known* is important. Mises explicitly accepts the 'value judgements' of the decison-maker(s), the socialist planning committee for example. His argument is not that they would choose to produce the wrong things, but, rather, that even if we suspend judgment on this, we can show that they would be incapable of effectively producing according to their own values. This makes it a praxeological (logical) rather than a historical (empirical) argument.

2. I did not see Mises explicitly make this argument, but his setup also implies that if we had a completely benevolent dictator, fully and genuinely committed to the 'public good', who also clearly understood the knowledge-problem and the impossibility of capital-accounting under a socialized system, he would attempt to establish a market economy by guaranteeing private property protections and the rule of law. In other words, he would abandon socialism. Benevolence or understanding or both must go if we are to explain the persistence of the socialist dictator or presidential candidate.