Bjørn Stærk blog - Hayek: The Creative Powers of a Free Civilization

Gill Doyle, California | 2005-02-03 02:03 | Link

Here I find Hayek to be fascinating and his ideas very appealing. He seems to be arguing for a go-slow approach to social engineering. It has taken us hundreds, if not thousands, of years, he says, to fashion the social relations and economic system that we have today. It would be foolish to presume that a man or a committee could sit down and reinvent a society that is as successful as what we have already achieved. What we have today is the product of generations of accumulated wisdom. We have achieved what we have through painful experience, through trial and error, and we should beware of revolutionary change. Consider what Pol Pot and his Khmer Rouge did to Cambodian society. Intoxicated by Marxist-Leninist ideas that they picked up as students in France, they went home to Cambodia, where they attempted to throw out everything that had gone before and remake Cambodia in the image of some rationalist dream of the Perfect Man. The result was a nightmare.

Hayek says that there were in Europe two eighteenth-century versions of liberty -- a British empirical version and a French rationalist version. (This is in Chapter 4.) "We have had to the present day," he says, "two different traditions in the theory of liberty -- the first based on an interpretation of traditions and institutions which had spontaneously grown up and were but imperfectly understood, the second aiming at the construction of a utopia, which has often been tried but never successfully." Hayek says that there is a difference in the practical conclusions to which these different approaches lead, and he quotes a colleague who describes that differnence as follows: "One [tradition] finds the essence of freedom in spontaneity and the absence of coercion, the other believes it to be realized only in the pursuit and attainment of an absolute, collective purpose." Hayek appear to see a direct descent from the French Revolution to the Communist fiasco of the twentieth century.

I think there is merit to what Hayek says here, and his thoughts about French retionalism and its influence conform also to what I have personally observed in my travels. I have noticed and often wondered about the popularity in Europe of philosophical systems -- of ideologies. Marxism, fascism, existentialism, and now anti-Americanism -- all have been more eagerly and thoroughly embraced in Europe (especially on the Continent) than in the English-speaking world. Why is that? Why do philosophical systems hold more appeal for Continentals than for English-speaking peoples? The only philosophy that we Americans have managed to launch is Pragmatism -- a kind of anti-philosophy that encourages a willingness to modify attitudes as circumstances change. Hayek identifies French rationalism as a likely progenitor of socialist ideology. I don't know that we can blame the French for all of the various reductionist philosophies that have warped European thinking in this last century, but I'd like to think that we might.

While Hayek advises us to beware of utopian attempts to completely remake civilization and tells us to value the accumulated wisdom of our ancestors, one mustn't grow too conservative, either. Hayek is not a conservative. In fact, his postscript to this book is entitled, "Why I Am Not a Conservative." Hayek does believe in progress, though some of what he says -- about socialized medicine, for example -- can sound reactionary.

Geronimo, USA | 2005-02-03 06:38 | Link

I found the following quote from Richard M. Ebeling, the Ludwig von Mises Professor of Economics at Hillsdale College, Hillsdale, Michigan, and serves as vice president of academic affairs for The Future of Freedom Foundation

Hayek's good fortune was that he lived to see his ideas proven right and those of his opponents shown to be relics of a bygone era. Not only has socialism and the planned society been shown to be theoretically untenable, the collapse of communism has demonstrated the practical impossibility of the social engineer's designing fantasies. The world, with the help of Hayek's ideas, may finally complete the task of rising up from serfdom.

The more I read of Hayek I've become impressed with his ability to defend the freedoms that were granted to man in a world where so many find justification to harness and limit those freedoms for selfserving purposes.

Jan Haugland, Bergen | 2005-02-03 09:45 | Link

That was just brilliant.

I must read Hayek, obviously.

Herbie, New York | 2005-02-03 18:04 | Link

Hayek is appealing, but according to him the government should never set up any social programs nor provide any form of safety net. That may make logical sense in an idealized world, but not in the real world. I am of the view that government does perform and should certain functions. Among them are education, aid to those who are no longer capable of fending for themselves. As I read Hayek he would not approve of such functions becuasae it is nt efficient. The short answer is that many forms of private activety are not efficient either. However that does not mean they should be dispensed with

Petter, Lillestrøm | 2005-02-03 20:20 | Link

I agree with Jan that the article was brilliant, but unlike him, I'll probably never read Hayek. I do plan,however, to read Raymond Aron, beginning with his classic _The Opiuum of the Intellectuals_. I came across Aron after reading a Robert Conquest piece (linked by Arts and Letters Daily) on democracy.
Here's a link to an article on Aron:

http://www.newcriterion.com/archive/19/may01/opium.htm

From reading what you've written about Hayek and the little I've known about him from before (huge influence on Milton Friedman and the Chicago School, etc.), it's clear that he and Aron are covering much the same territory.

Somewhere in what I've read on Aron in the last couple of days, is a short synopsis of the diffence between Utopian visions of the Grand Systemic Thinkers (sic), and the views of Aron and, from what I can gather, Hayek.
The differences between the two is : The Utopians are optimistic about Man (read humanity) but not men (read individuals). For Aron it was the opposite. Faith in the collective, versus faith in the individual.

Regarding the complexity of the world and our inability to comprehend it whole, Aron's view would be that we should be humble, striving always to find a better solution because the Best is never available.

Gill Doyle, California | 2005-02-04 03:58 | Link

Herbie writes: "Hayek is appealing, but according to him the government should never set up any social programs nor provide any form of safety net."

Herbie, I haven't finished reading Hayek's book, and so I can't say for sure that you're wrong in what you say here about Hayek. But let me quote from Chaper Seventeen, in which Hayek attacks what he calls "the welfare state": "All modern governments have made provision for the indigent, unfortunate, and disabed and have concerned themselves with questions of health and the dissemination of knowledge. There is no reason why the volume of these pure service activities should not increase with the general growth of wealth. There are common needs that can be satisfied only by collective action and which can be thus provided for without restricting individual liberty. It can hardly be denied that, as we grow richer, that minimum of sustenance which the community has always provided for those not able to look after themselves, and which can be provided outside the market, will gradually rise, or that government may, usefully and without doing any harm, assist or even lead in such endeavors. There is little reason why the government should not also play some role, or even take the initiative, in such areas as social insurance and education, or temporarily subsidize certain experimental developments. Our problem here is not so much the aims as the methods of government action."

"The reason why many of the new welfare activities of government are a threat to freedom . . . is that, though they are presented as mere service activities, they really constitute an exercize of the coercive powers of government and rest on its claiming exclusive rights in certain fields."

Gill Doyle, California | 2005-02-04 04:10 | Link

Does this sound familiar?: "But because circumstances are always shifting, truths need constantly to be restated if they are to maintain the grip, the purchase of truth." It comes out of the New Criterion article to which Petter referred us. Petter, thanks for the tip. I had never heard of Raymond Aron. He does sound interesting. I'll take a look at his work.

Øyvind, Leuven | 2005-02-04 09:02 | Link

To claim that other societies than the so-called socialist societies is not planned is quite laughable. Are there no plans in the United States? Do not the concervatives in France plan? Is it not true that huge multinational and capitalist companies, I work for one myself, plan?

An idea of an unplanned society is purely utopical - and those who cling desperately to utopian ideas will get in problems.

The idea of an unplanned society is purely utopical - and those who cling desperately to utopian ideas will get in problems, regardless of what colour the very own Utopia has. This is the greatest flaw of socialism. And it is a flaw that comes with other Utopias as well.

Bjørns attack on socialism sadly seems to be a giant strawman attack.

- The mistake of the economic planner is to see society as something that can be understood, and thus controlled or redesigned, by a single human mind, he writes and then he tells us that Hayek sees society as a "vast distributed system of knowledge, where no one person is aware of more than a fraction of the whole, and where the success of all our actions depends on knowledge we don't have, but others do".

As a matter of fact, few socialists would disagree.

Surely, there has been those who has tried to rule everything in a society - totalitarian regimes with their own private ideas of Utopia, differently coloured and often with private agendas more important than the stated beliefs in for instance a classless society. But even socialists learn from history.

Modern socialists do not want to gather all power, all incentive, in the hands of one man. Modern adherents of economic planning do not believe that everything can be planned, from what colour people want on their clothes to what shoesize they should have. Modern socialists believe, just like Hayek, that society is a vast and complex system, too vast and too complex for a single mind to understand. But we still believe that this system can and should be changed.

I have not read Hayeks book. What I have read from it and about it, though, suggests that he could have called it "The Limitation of Freedom" instead.

Bjørn says: "Only when individuals are allowed to act on their own knowledge is economic progress possible. Instead of attempting to plan economic, social and institutional discoveries, we should thus provide opportunities for individuals to make them on their own".

The question is obvious.

Does a capitalist society provide this? Truly? Fully? And for everyone? If you look at statistics for social mobility, for instance, I would dare question that it does.

Bjørn Stærk | 2005-02-04 10:58 | Link

Øyvind: Are there no plans in the United States? Do not the concervatives in France plan? Is it not true that huge multinational and capitalist companies, I work for one myself, plan?

You're playing with words. I clearly mean economic planning in the sense of attempts by the government to control the economy in detail to reach specific goals, through taxes, regulations, tariffs, monopolies, private-public projects, etc. All governments do this, not always unjustified, but the further left you go, the more eagerly politicians embrace the illusion that they have the knowledge to do such planning well.

The good kind of economic planning is the general kind: Adjusting the parameters and legal foundations of the economy so that it works better. This is "planning", but it doesn't presume specialized knowledge about particular aspects of the economy.

As for companies, they have detailed control over internal affairs, but there are many of them, so bad decisions are not disastrous for society as a whole. At worst the company pulls down a few others with it, but at least the mistake is discovered and corrected - this is much less likely to happen when the government makes economic mistakes. Working together is a good thing, everyone working together on the same team is not. Basic eggs-in-one-basket problem.

An idea of an unplanned society is purely utopical - and those who cling desperately to utopian ideas will get in problems.

The question is where the planning should take place, and with what resources: Should I plan how to apply my resources to circumstances I know best, in order to reach my own goals, or should a central authority plan how to apply my resources to circumstances it doesn't understand, in order to reach its own goals? Which is more risky, and which is more likely to lead to economic discoveries?

Modern socialists believe, just like Hayek, that society is a vast and complex system, too vast and too complex for a single mind to understand. But we still believe that this system can and should be changed.

Like I said, I don't believe modern socialists are totalitarians, and I believe Hayek was wrong about socialism being incompatible with democracy. Nor do I believe that socialists intend to control every single aspect of the economy. But they do intend to control many aspects of it. It's a question of attitude. Socialists are eager to interfere. They have a high amount of confidence in the ability of the government to solve specific problems. That confidence is unjustified and dangerous.

Does a capitalist society provide this? Truly? Fully? And for everyone? If you look at statistics for social mobility, for instance, I would dare question that it does.

If you define a capitalist society as one that "provide[s] opportunities for individuals to make [economic discoveries] on their own", of course it does this. But that's a circular argument and not very interesting. The question is if such a society reaches the goals we want it to reach. You measure success by social mobility. Very well, show us your statistics.

Other ways to measure success are general wealth, equality, minimum living standards. How you prioritize them is partly a question of values. Individual freedom is not a good way to ensure economic equality, but then I believe that general wealth and eradication of poverty is more important than equality. Individual freedom gives us wealth, and government welfare can ensure minimum living standards. The question is: Which level do we disagree on? Do you disagree that wealth is more important than equality, or do you disagree that individual freedom leads to wealth?

Herbie NY | 2005-02-04 13:07 | Link

PETER, I TAKE YOUR POINT AND AGREE. HOWEVER THAT IS NOT HOW HE IS COMMONLY INTERPRETED

Øyvind, Leuven | 2005-02-04 13:28 | Link

Bjørn:

Actually, I am not playing with words. My point is that all economy is planned. When you talk about the planned economies of the former Eastern bloc you, what you are really talking about is centralized economies.

The problems of centralized economies, including lack of incentive and other examples, can happen regardless of whether this economy is socialist or capitalist in name. Few economies have been more monopolized than the ones in the Soviet Union, but the free market is also monopolizing itself. In my opinion, the question we should ask ourselves, Bjørn, is not the question you seem to be asking; it is - instead - how do we achieve a decentralized economy and maybe also; how do we achieve a decentralized society.

I doubt that the liberties of the classical rightwing will give it to us, as these liberties are limited. I also doubt that the classical leftwing can give us these liberties, since socialists still seem bent on centralization far too often. But does this mean that a "planned economy" takes incentive away and leads to what you refer to as ignorance?

Hardly. It depends, as you say - where the planning does take place. However, it also depends who takes part in the planning. If planning is limited to the board rooms and the parliaments, it is centralized. No matter what happens with wealth development, no matter what happens with minimum living standards. Incentive will disappear. People will become alienated.

Such limitation in power - and indeed in freedom - can, will and does indeed also lead to politics that are economically beneficial, but environmentally, socially, etc. non-beneficial. The world is full of examples of toxic waste dumped in rivers, of labourers being exploited, etc., etc. - and not seldomly it happens in the name of freedom.

The only way to avoid this, as far as I see, is increased democratic control over the economy. That is moving control over "the means of production" into the hands of us all to a larger degree than today. Many would call that socialism.

Øyvind

Øyvind, Leuven | 2005-02-04 13:31 | Link

Correction: Such limitation in who has power - and indeed freedom - ...

Geronimo, USA | 2005-02-04 17:22 | Link

It is very disappointing that Kofi Annan will appoint impeached former President, Bill Clinton, to oversee tsunami reconstruction efforts. How so, you ask?

http://www.cnn.com/2005/US/02/01/clinton.tsunami/

This is part of a larger effort by former President Clinton to become the General Secretary of the United Nations. Keep in mind two excellent chess players in the world of politics are Bill and (Senator) Hillary Clinton. Not because they are good statesmen, but because they are so good at politics (interpretation: lying). As part of his effort last year, Clinton's non-profit Clinton Foundation formed a partnership with the UN. Imagine this, Hillary Clinton making a run for President of the United States in 2008 while Bill Clinton is General Secretary of the UN?

This is yet another of several reasons most Americans want out of UN. If you thought the misappropriation of billions of dollars in the oil for food scam, and other humanitarian aid siphoned off by dictators, politicians, despots and corrupt UN officials, is disgraceful, you’ve not seen anything until “Bill’s” been put in charge. He is not known as the “Teflon Don” for his ability make omelets. That’s French, isn’t it? Oh yes, who will grease who’s skids, Hillary or Bill. Why folks, this is a two way street! These two share many values with the corrupt UN officials and their "Bash America" agenda, but they don't have the slightest bit of shame when it comes to scamming you out of power and influence. This is “NOT All” about money you must realize.

What we need to see is a new organization to replace the UN comprised only of freedom-loving countries, and this will not happen unless we first get the UN out of the US (visa versa works too) and halt America's funding of this now corrupt organization. I hope my European cousin’s are listening!

Herbie NY, NY | 2005-02-04 17:35 | Link

This is really the best, from the London Times

"Kofi Annan, the UN Secretary-General, said today that he will discipline the former head of the UN oil-for-food programme after it emerged that he had secretly negotiated with Saddam Hussein over the awarding of oil contracts"
* * *
"Mr Sevan is now retired, though he continues to serve the UN on a dollar-a-year contract"

I can see it now. With great fan fare Annan will announce that Sevan's $1 a year contract has been terminated and he no longer will have dining room privileges.

Gill Doyle, California | 2005-02-04 19:42 | Link

Øyvind writes: "If planning is limited to the board rooms and the parliaments, it is centralized."

"The only way to avoid this, as far as I see, is increased democratic control over the economy. That is moving control over "the means of production" into the hands of us all to a larger degree than today. Many would call that socialism."

Øyvind, how do you reconcile the two statements you've made there? If by "democratic control", you mean socialism, then you would have government managing your economy, would you not? Are you proposing an economy that is government-run, but not centralized? If so, what would that mean?

Couldn't one say that a more capitalistic society is a more democratic society, since the means of production are privately owned? If, by democratic control, you mean transfer of the means of production from private to government hands, then aren't you really advocating government monopoly? I don't see that that would give me, personally, a bigger say in how the means of production are utilized. Right now, in America, I can choose a different phone company if I don't like the service I'm getting now. I can choose a different electric company if another company offers a lower rate. If I don't like my doctor or my local hospital, I go elsewhere. Etc. It seems to me, that by allowing government to manage all these services (if, that is, you intend that government should have a monopoly), you deny us the opportunity to provide any of these services to the consumer, should we choose to go into such a business, and you deny us, as consumers, the opportunity to choose a competing service. That sounds to me like a less democratic society that what I've got now.

I'm not saying government has no role at all. Some agency has to enforce standards, and some minimum of medical care, education, and sustenance has to be guaranteed -- else certain individuals become a burden on society.

But substituting a panel of government bureaucrats for a board of directors doesn't guarantee that the individual citizen will have a greater say in how a business is managed. And if government control means monopoly, then efficiency and quality of service may actually decline.

I think the trend in America and in Europe is for less government, not more. Europe's welfare system is on the way to becoming unsustainable, isn't it? On this side of the Atlantic, we have realized that our Social Security System is on the way to bankruptcy. Partial privitization of pensions is one option that we are considering as a remedy.

Herbie NY, NY | 2005-02-04 20:02 | Link

Oyvind says "If planning is limited to the board rooms and the parliaments, it is centralized". I fear that he has no idea what he is talking about. Boards of directors set broad general policy, and seeks to insure the integrity of the business model and little more. If government was limited to that all would be well and good. However, in government since there is no calculus to determine if something is working and "profitable" the only measure is that made by the recipient - less than an objective judge t say the least.

Øyvind, Leuven | 2005-02-04 20:40 | Link

"Are you proposing an economy that is government-run, but not centralized? If so, what would that mean?"

Both yes and no.

I want more of the economy to be governed by representatives of the people or - ideally - by the people itself. At the same time I do not wish for centralization.

In other words, what I want is decentralized democratic influence over decisions - something that can, in my opinion, be best achieved through local municipalities, through the use of direct democracy and/or through local chosen representatives.

I want a society where both the state and corporations are weakened compared to what they are today.

Over-simplified, you could say that electricity production in Norway used to be based on these principles. Of course, different local powerplants cooperated, but municipalities had a great influence over their own power plants, and prizes for electricity where locally set.

It was indeed a monopoly, but it was a democratically run monopoly - since city councils etc. could influence the politics of the power plant industry. Today, while still being government-owned to a large degree, power plants are "de-monopolized".

Suddenly we have seen power crisis as a result of underproduction, though the problem has not always been a lack of rainwater for the hydropower plants, but rather that the dammed lakes have been emptied at low-demand times (summer) and the electricity produced sold abroad, resulting in power shortage and higher prizes at high-demand times (winter).

This is profitable for the companies that are now run after commercial principles, but is it positive for society as a whole?

A part of the story is of course that some companies still find themselves in a position which is close to a monopoly, but are now run according to principles of profit, not of delivering a service to the people.

"Europe's welfare system is on the way to becoming unsustainable, isn't it?"

It depends who you choose to believe. If you choose to believe those who want to shut it down, the answer is yes.

Øyvind

Øyvind, Leuven | 2005-02-04 20:41 | Link

Uh, and by the way, I do not really see what Kofi Annan and Bill Clinton has to do with all of this.

Herbie NY, NY | 2005-02-04 20:57 | Link

Oyvind you say "what I want is decentralized democratic influence over decisions - something that can, in my opinion, be best achieved through local municipalities, through the use of direct democracy and/or through local chosen representatives."

I submit that you idea does not work beyond a local level. Certainly the transfer of tax revenue from an area of a country that does not need it as badly as another area is a good example. There is no incentive to do so except -- perehaps morality.

As for Kofi Annan and Bill Clinton one of them is really dumb, but rather then engage in a critique of affirmative afction I will leave it at that

Geronimo, USA | 2005-02-04 22:25 | Link

Øyvind,

After the 1/26/2005 announcement that French President Jacques Chirac calling for a tax to finance the global fight against AIDS, which would/could be administered through the United Nations, while we’re talking about The Creative Powers of a Free Civilization, and you don’t get the connection? This organization is trying to poise itself for control over your government and mine. It has totally lost its purpose when first established in 1946.

http://www.un.org/aboutun/charter/

The ambitions of some of the third world countries and “Johnny-come-lately” nations pose to usurp the sovereignty of the wealthier nations by successfully imposing international rules that are in conflict with our own constitutions. Surely you get the connection?

Bjørn Stærk | 2005-02-04 22:39 | Link

Øyvind: My point is that all economy is planned. When you talk about the planned economies of the former Eastern bloc you, what you are really talking about is centralized economies.

I'm not sure I've mentioned the Eastern bloc - Western European social democracy is more relevant. But there are degrees of planning, and at its most extreme it does involve the state controlling every aspect of the economy. The point here is that economic planning in general is risky, because we're uncurably ignorant of the detailed workings of the economy we hope to influence. If you still insist that "all economy is planned", well, then you're playing with words again, because I've already defined what I mean by economic planning (detailed control towards specific ends). If you don't agree that planning is a good word for this, you're free to use another word, but at least you know what I mean.

the free market is also monopolizing itself

Maybe, but I think you should give some examples. Many have strange ideas about what a monopoly actually is. (Microsoft, for instance, is not one.) When true monopolies form, however, and this isn't caused by economic planning, I agree that it's a problem, and that we should look for ways to break them. But rejecting individual freedom alltogether because it sometimes leads to monopolies, economic depressions, and corruption and other bad things, is like rejecting the human body because it sometimes falls ill. The question is not if individual freedom never leads anywhere bad, but how often it does, compared to the alternatives, and how difficult the problems it leads to are to fix.

In my opinion, the question we should ask ourselves, Bjørn, is not the question you seem to be asking; it is - instead - how do we achieve a decentralized economy and maybe also; how do we achieve a decentralized society.

But what do you mean by a decentralized economy? A free market without monopolies? If so, maybe we agree about the essentials, and disagree only about how we interpret monopolies.

I doubt that the liberties of the classical rightwing will give it to us, as these liberties are limited.

Limited how? I hope you read the entry on defining freedom. Two people can talk for hours about "freedom" and mean two entirely different things by it. If you take individual freedom to an extreme, then clearly that particular form of liberty is not limited, but others are. So it's not very meaningful to discuss if capitalism leads to "freedom". The right way to put it is that capitalism is an economic system that prioritizes individual freedom over other kinds. It "leads to" individual freedom only in the sense that individual freedom is the core component of capitalism. Without it, you can't have capitalism.

But does this mean that a "planned economy" takes incentive away and leads to what you refer to as ignorance?

I only mentioned incentives to downplay their significance - social democracies reduce incentives by taxating towards equality, but I don't think this is a very important argument against it. There are better reasons why we need rich people than that they provide everyone else with something to strive towards. And I haven't said that planned economies lead to ignorance - ignorance is an inherent aspect of complex society, as the uncertainty principle is in physics. The challenge is not how to avoid it ignorance, but how to live with it. Distributing the power to act on knowledge to the very people who posess it is the obvious solution to that challenge.

Hang on - you're mixing separate issues here. Allow me to modularize:

1. The validity of environmental threats. Are environmentalists correct in identifying a certain environmental problem? Sometimes yes, other times no. This is primarily a scientific question, ideally unconnected with politics.

2. Assuming the problem exists, what do we do about it? This depends on the extent of the problem, and the cost of solving it compared to solving other problems. On one side you have global warming, which may be caused by human activity, but is prohibitively expensive to halt. On the other you have traditional tragedies of the commons - toxic waste in drinking water, excessive exploitation of natural resources, etc. These cases are not "economically beneficial" except in the short term, and government interference is justified in order to introduce a long term perspective.

3. Exploitation of workers. This rests largely on your definition of "exploitation", another one of those words people throw about in debates as if they have a clear meaning. What is often meant is "companies making excessive demands of workers", where excessive is defined as long working hours, bad working conditions, or low salaries. That definition is fine, as long as you keep in mind that this form of exploitation is only possible where there is general poverty. So which is the larger problem, the poverty of the overall population, or the exploitation of those few who have jobs with powerful companies? The poverty, of course. Now, what if solving poverty requires a period of exploitation, or what if limiting exploitation means that ending poverty will take more time? That is our dilemma. Nobody wants exploitation, but talking about exploitation without considering the context of poverty is meaningless.

(Oh, and everyone else: Keep the Kofi/Clinton/off-topic stuff to a minimum. This is not a general open forum.)

Dean Esmay | 2005-02-06 09:40 | Link

Actually if you look at highly capitalist economies you find that income mobility is quite good. The U.S. is much more capitalistic than Norway, just for example, and our income mobility is extraordinary. Despite claims that the wealthy 1% control so much of the wealth, if you look carefully you'll see that almost all people regardless of social status rise beyond poverty and do well as they get older; the only people who this is not true of are single mothers who have children at home to care for, and very recent immigrants who do not speak the language. Even then, most do fine. Despite what you may read, the truth is most people really do succeed and prosper here.

It's also the case that the "gap between rich and poor" is mostly a shell game, since most of "the poor" are merely young people who are still in school or are starting entry-level jobs. Take them out and you're not left with a lot. Also, if everyone's income rises at about the same rate (and it does) then the "gap between rich and poor" will always increase even as absolutely everybody grows more wealthy and prosperous.

Read Gregg Easterbrooke's "The Progress Paradox" for more on all this--and by the way, Easterbrooke is no right-winger or libertarian ideologue.

njet | 2005-02-06 20:44 | Link

473

Socialism in respect to its means. Socialism is the visionary younger brother of an almost decrepit despotism, whose heir it wants to be. Thus its efforts are reactionary in the deepest sense. For it desires a wealth of executive power, as only despotism had it; indeed, it outdoes everything in the past by striving for the downright destruction of the individual, which it sees as an unjustified luxury of nature, and which it intends to improve into an expedient organ of the community. Socialism crops up in the vicinity of all excessive displays of power because of its relation to it, like the typical old socialist Plato, at the court of the Sicilian tyrant;11 it desires (and in certain circumstances, furthers) the Caesarean power state of this century, because, as we said, it would like to be its heir. But even this inheritance would not suffice for its purposes; it needs the most submissive subjugation of all citizens to the absolute state, the like of which has never existed. And since it cannot even count any longer on the old religious piety towards the state, having rather always to work automatically to eliminate piety (because it works on the elimination of all existing states), it can only hope to exist here and there for short periods of time by means of the most extreme terrorism. Therefore, it secretly prepares for reigns of terror, and drives the word "justice" like a nail into the heads of the semieducated masses, to rob them completely of their reason (after this reason has already suffered a great deal from its semieducation), and to give them a good conscience for the evil game that they are supposed to play.
Socialism can serve as a rather brutal and forceful way to teach the danger of all accumulations of state power, and to that extent instill one with distrust of the state itself. When its rough voice chimes in with the battle cry "As much state as possible," it will at first make the cry noisier than ever; but soon the opposite cry will be heard with strength the greater: "As little state as possible."

11. In 388 B.C. Plato visited the court of the Sicilian tyrant Dionysius the Elder in Syracuse, where he returned in 367 and 361 B.C., hoping to realize his political ideals there.

http://www.publicappeal.org/library/nietzsche/Nietzsche_human_all_too_human/index.htm

Herbie NY, NY | 2005-02-07 20:58 | Link

No one has posted anything for a while, the title of this is "The Creative Powers of a Free Civilization"

Compare and contrast :-)

Secretary Rice to a European audience: "There cannot be an absence of moral content in American foreign policy," she says. "Europeans giggle at this, but we are not European, we are American, and we have different principles."

On the other hand, George Orwell once said "Some ideas are so stupid that only intellectuals could believe them."

Gunnar, Maryland | 2005-02-08 04:50 | Link

Also, if everyone's income rises at about the same rate (and it does) then the "gap between rich and poor" will always increase even as absolutely everybody grows more wealthy and prosperous.

great point. Another point that bolsters yours is that the members of the so called "rich" are always changing. Unlike Europe, in the US, there are always people with new money, while the old rich quickly lose their money, unless they go into politics to keep it. :)

Øyvind, Leuven | 2005-02-08 10:37 | Link

I just wrote a long post to reply to you, Bjørn, but somehow your site hanged upon me. Therefore I will just write a short summarization.

First of all, notice that I do not talk about monopolies in the market economy, but of monopolization, a tendency to move towards less competition and greater entities - and thus more centralization. Microsofts market role and their use of this is an example of the problems connected with this process, although Microsoft does not have a true monopoly.

My point is that all economy is planned, including capitalist economies, where there also exists "detailed control towards specific ends". The difference is who does the planning. To me a more important difference is how many has the chance to take part in the planning, I want a decentralized economy - but an economy which is also regulated by the society, something we both agree is necessary. You have spent to much time around computers when you try to modulize environmental issues away from capitalism - a free capitalism provides greater freedom for capital than a regulated capitalism, but it does take profit considerations before all other considerations. Interference from society is needed.

Furthermore I think some key services should be provided by society-run enterprise, this includes hospitals, schools etc (like today), but also other services (like some basic production). That does not rule out private alternatives, but it does enable society to set prizes etc. politically and to plan better from several considerations outside the classical profit perspective of capitalism. To ensure a democratic control over what is regulated I suggest a more local and more direct democratic form of society.

Bjørn: Exploitation of workers. This rests largely on your definition of "exploitation", another one of those words people throw about in debates as if they have a clear meaning. What is often meant is "companies making excessive demands of workers", where excessive is defined as long working hours, bad working conditions, or low salaries.

Exactly.

Bjørn: That definition is fine, as long as you keep in mind that this form of exploitation is only possible where there is general poverty

Really? Would you say that the United States have general poverty? Or are you saying that "long working hours, bad working conditions, or low salaries" does not exist in the States? You could pick several Western European countries, and that would also be an odd claim... Norway is quite good. Norway has a healthy dosis of socialism. I want that health to continue, and some new medicines might be invented too.

Bjørn, your picture of capitalism as an economy that necessitates freedom is all nice and good.

But your capitalism is the capitalism of the visionary and not of the managing directors. Freedom of religion does not have to exist for capitalism to do so. Freedom of speech does not have to exist for capitalism to do so. Freedom of capital does have to exist, but this freedom can and often is limited to a small upper class, that is in reality. Capitalism is an economic system, not a political system. There are numerous examples of capitalist and unfree countries, like Pinochets Chile.

Øyvind

Kim Sook-Im,US | 2005-02-08 13:54 | Link

"Freedom of religion does not have to exist for capitalism to do so. Freedom of speech does not have to exist for capitalism to do so."....oh Oeyvind you forgot to mention -'Singapore' would be a goooood example - it is a somewhat horribly capitalist society that is horribly and totaaaaly undemocratic ( a la freedomm Huis)...but whose citizenry enjoy a rather comfortable,civil and satisfying life quaintly kontented with their Konfucianistik tradition of social harmony which westerners interpret as undemokratik ( as kompared to lilberal and libertine Norweejah ). Assumedly foooly demokratiiik Mali is also a kapitalist society. Interestingly this Freedum-House-democratique kuntry is also one where the democracy only extends insofar as the majority parties are ikkklsamist LOL....and incidentally, the much touted demokrasi in Mali-land is fast unravelling thanks to the benign nature of your demokracy-friendly Ikkkslam LOL

-->http://www.freedomhouse.org/religion/news/bn2003/bn-2003-10-16.htm

http://www.worthynews.com/news-features-2/mali-evangelism.html

( funny...in freedomm-house-demokratikkk Mali, there is much fear of persecution of religioius minorities like christians as mentioned in the above article. In kontrast, "democracy"-challenged Singapura permits the free practise of religion without fear and persekkkution......hmmm i wonder why? )

Øyvind, Leuven | 2005-02-08 16:21 | Link

Sook-Im:

If you want me comment on the threat against democracy in Mali, there is no doubt that it exists - Mali, especially northern Mali, is a battle ground in the fight against extremist Islam. Of course, and this you seem to forget, Muslims fight on both sides in that battle.

For this discussion all that is of course completely irrelevant, and it would be nice to stick to topic, for once. Thus, I am going to comment on your other example - Singapore. Why? Because it is actually an excellent example.

Few would deny that Singapore is a capitalist country - maybe not according to ideals, but in reality. By Southern Asian standards it is a wealthy country.

But... while being far from "totally undemocratic", as you seem to dream that I think it is (I am thankful you fantasize about me, Sook-Im, but you do not need to publish those fantasies on the web), Singapore is not fully democratic.

Its human rights record is not the best I have seen: http://web.amnesty.org/library/eng-sgp/index

Actually, freedom of religion is not full in Singapore either. Jehovah's Witnesses has been de facto banned since 1972 and the Unification Church since 1982.

This shows that capitalism does not equal liberty. The only freedom guaranteed is the freedom of capital. Historically, that was a freedom that had to be fought for. Other freedoms also have to be fought for, and personally I think some of them are even more worthy.

AlanC | 2005-02-08 17:17 | Link

Oyvind,

Your main problem is that you do not understand the nature of economic liberty.
And you do not understand the nature of capitalism. Capitalism is a theory which is descriptive of a particular economic condition, free flow of capital and labor. Unlike a prescriptive system such as communism. There is NO completely capitalistic society in the world because it is impossible to meet all of the criteria, specifically the transparancy and universality of information. The theory is that goods and services are best distributed by uncontrolled interaction between ALL members of society entering transactions for their own personal benefit, rather than through some government or oligarchic planning process. This is why so many large monopolistic companies fold when their monopoly is broken.

This assumes that each actor has all the same information as every other actor. Of course this not only can't happen, it is beneficial to some to constrain information. This is the reason that there are laws against insider trading. Information is kept from the mass of investors to their detriment and the benefit of those with the info.

Now, vis a vis labor you said: "Would you say that the United States have general poverty? Or are you saying that "long working hours, bad working conditions, or low salaries" does not exist in the States? "

You need a few more definitions here....
1) how low is too low?
2) how long is too long?

You see, in a capitalistic society each person is their own most important asset and they are responsible for investing themselves wisely. How much is your "human capital" aka labor worth? Who sets that price? In a free society each and everyone of us gets to negotiate their own value.

Now, in any transaction there are two sides, and while I might think that I'm worth $1 million a year, that doesn't mean anything unless I can find someone that 1) agrees with me 2) will pay me that much.

This simple fact is what makes me laugh at the typical conversation about how this or that actor, athlete, CEO, etc. is not worth the money.
Well that person IS worth that much ipso facto. If someone didn't agree they wouldnt get it.

This is where Bjorn's poverty comes in...if the general economic condition is such that peoples labor is not worth much then they can be "exploited" BUT the people are still responsible, in a free society, for their own exploitation. No one forced them to work long hours for low pay except their own circumstances. After all you can always start your own company and exploit yourself via long hours and low pay as so many thousand have done. They're called entrepreneurs and most all of them worked very long hours for very little money till they started to "make" it, or failed.

Petter, Lillestrøm | 2005-02-08 19:20 | Link

This is what happens when you contribute to a thread and get a couple of responses and then go away for five days. Not that anyone’s interested but I’ve been in Sweden (former poster boy for Social Democracy). To stay within the galaxy of the topic of this thread; food, alcohol and tobacco (gave up the last some years ago…COPD) is a lot cheaper in Sweden than in Norway, which says something for Norway. The way it works in the Nordic Countries is that the Norwegians shop in Sweden, the Swedes shop in Denmark and the Danes shop in Germany. After that it gets weird.
The thing is: Norway is outside the EU. So unlike the other above mentioned, Norway has fairly tight (using “tight” fairly loosely) border and custom control. Get busted taking in more than your (ridiculously miniscule) quota of meat or alcohol…or tobacco…wheeze, wheeze, you get a hefty fine. So driving back over quota is a tight gut crossing. For you Americans, imagine that you could buy…hmmm…fireworks, the real kind, Cherry bombs and M80’s and shit across the border and you load up and as you cross back into your own state, you’re pulled over in a mass Highway Patrol action and asked if you’ve got any fireworks in the car. It’s that kind of a deal.

Gill. You’re welcome for the tip. I’m glad I came across Aron myself. Never heard of the guy before.

Herbie: Not sure who you’re referring to here? Hayek or Aron (or someone else)?
PETER, I TAKE YOUR POINT AND AGREE. HOWEVER THAT IS NOT HOW HE IS COMMONLY INTERPRETED
Kim: Are you familiar with the Japanese band Shonen Knife. They got a tune called Ah, Singapore_. Lyrics include:
You can’t buy chewing gum anywhere in Singapore,
But you can buy peppermint candy
Cause you eat it til it’s gone
Singapore, ah, singapore

Bjørn Stærk | 2005-02-08 20:32 | Link

Øyvind: I just wrote a long post to reply to you, Bjørn, but somehow your site hanged upon me.

I'm sorry about that. I've burned myself on this a few times, in my own and other blogs. My advice is to write comments in a text editor, and keep a copy there until you see that has been posted.

Microsofts market role and their use of this is an example of the problems connected with this process, although Microsoft does not have a true monopoly.

How? I'd appreciate if you were specific. Microsoft has many customers. They have good products, and strong competitors. They also throw their weight around, using whatever means available to make money, often in ways that are unethical. Which in my view makes Microsoft a good case study of the robustness of a free market. When even Microsoft is unable to eradicate its competition by market power alone, I believe that is a good sign.

I won't idolize Microsoft (success => moral superiority) or pretend that the market is perfect. I see the flaws, but I also see that they're not fatal, and I believe that to solve such problems with government interference is risky, for all the reasons discussed above. Perhaps in addition to explaining why Microsoft is a problem, you should provide som ideas of how that problem could be solved.

My point is that all economy is planned, including capitalist economies, where there also exists "detailed control towards specific ends". The difference is who does the planning.

Yes - is it done by people who posess the knowledge they need to succeed? This takes us back to the problem of complexity and ignorance. You talk about decentralizing control of the economy, but as long as you rely on the government, you rely, in effect, on a small number of experts making decisions based on their limited understanding of a complex system. Doesn't matter if there is a separate group of autonomous experts for each city, even a local economy is complex, (not in the sense of "difficult to understand", but in the sense of a non-linear system.) What about regional and national issues? And what will prevent the national authority from influencing local matters, like it does today?

It is possible that you have thought through all these issues already, and can account for how you intend to solve them, but I haven't seen any sign of it, and I suspect that what you have is an idea of how you want things to work, not how they realistically can work, or can be made to work based on what we have today.

You have spent to much time around computers when you try to modulize environmental issues away from capitalism - a free capitalism provides greater freedom for capital than a regulated capitalism, but it does take profit considerations before all other considerations.

You misunderstand what I mean by modularization. Modular design does not mean that modules are isolated, but that their relationships are clearly defined, and that borders are drawn to keep what's unrelated unavailable, and to minimize the cost of replacing one module. Of course capitalism is relevant for environmental issues. It's relevant in the form of the tragedy of the commons, which is a known problem, with at least two known solutions: Tweaking the market so that short-term cost reflects the long-term cost, or by making undesired behavior illegal. As long as this is done through legislation, (ie. not at the whim of bureaucrats), and is based on good science and sensible priorities, I'm all for it.

You may believe that right-wingers are flippant about threats to the environment, but that's beside the point. For environmental problems to be a fatal, inherent flaw of a free market, there has to be no practical way to solve such problems without abandoning individual freedom. But there are. We know that these solutions works, they have been tested with various flavors of capitalism over the world for decades. So reality does not agree with you.

Really? Would you say that the United States have general poverty? Or are you saying that "long working hours, bad working conditions, or low salaries" does not exist in the States?

I would say that poverty and exploitation are proportional. The US has some poverty, and also some exploitation. But you avoid my dilemma: If exploitation is both a product of poverty and the way out of it, then we should consider both together, and not exploitation alone. If not we risk undermining our own efforts, (as when third world children are chased from factories to prostitution or starvation by well-meaning Westerners). Remember that I use "exploitation" in a clearly defined sense, without the unspoken assumption that fighting it takes priority over everything else, (which is how most people use it, like "freedom", something vague and inherently good/bad.) Just pointing out that exploitation exists doesn't lead anywhere. Discussing it is meaningful only in the context of the greater problem of poverty.

Bjørn, your picture of capitalism as an economy that necessitates freedom is all nice and good.

It wasn't intended to be nice and good. Capitalism is by definition an economic system based on individual freedom. The more individual freedom, the more it is capitalism. That's all I mean by it. Individual freedom is not an obvious good, and I'm not trying to appeal to the positive associations of the word "freedom". Individual freedom is good if it leads to good things, and it is bad if it leads to bad things. As simple as that.

Capitalism is an economic system, not a political system. There are numerous examples of capitalist and unfree countries, like Pinochets Chile.

As I wrote two weeks ago, pro-market authoritarianism is a threat because it grants some of the benefits of freedom while allowing an elite to stay in power, making it a tempting alternative to liberal democracy. It's just as naive to believe that markets require democracy as it is paranoid to claim that democracy is incompatible with socialism. But compromises must be made in both cases. There's nothing pro-market about the way the Russian government has acquired an effective TV monopoly. And powerful individuals who stand above the law are a large threat to any market, because their behavior is so unpredictable.

There are benefits to allowing people to do business in such an unpredictable environment, according to the random rules of a power hungry elite, (it's better than socialism), but you gain even more benefits when you grant people true individual freedom, protected by rule of law.

You insist on limiting this discussion to economic affairs, (which is why you talk about capitalism, and I talk about individual freedom), but what is really the difference? Society is a complex system also apart from the economy - think of science, ideas, institutions, and social networks. Centralized planning is bad in those areas for the same reason it is bad in the economy: because they are complex systems. Which is why this isn't really about markets and companies, but about 6 billion individuals who interact with each other, and how best to exploit their combined abilities.

I'm not pretending that you can't analyze complex systems. I highly recommend Critical Mass by Philip Ball, who looks at what we're beginning to learn about complex, interaction-based systems. All such systems have certain features in common, whether the interacting entities are atoms or people, and that allows us to apply insights from physics to society and the economy. Exciting stuff. So you can analyze complexity, and learn how to tweak the circumstances to optimize particular behavior. What you can't do is analyze it in detail, and make predictions about the specific effects of specific actions. So while we may discover how the government can better set the right conditions for a free economy, what we won't discover is that it is qualified to control the economy in detail.

Øyvind, Leuven | 2005-02-09 10:42 | Link

Bjørn: My advice is to write comments in a text editor, and keep a copy there until you see that has been posted.

Øyvind: That would be the smart thing to do yes.

Bjørn: Microsoft has many customers. They have good products, and strong competitors. They also throw their weight around, using whatever means available to make money, often in ways that are unethical.

Øyvind: You gave an example yourself. Microsoft has not been able to eradicate the competition, but these days they are almost sovereign when it comes to personal PC operative systems.

I work for a helpdesk for customers buying printers, cameras etc. from one of the major producers of such hardware. I get many calls a day. On a daily basis I hardly have more than one Mac-related call, and Linux we do not even support.

This sovereignty Microsoft has been using to gain the upper hand in other fields. Sometimes in an unethical matter.

You say government interference is risky. True. But so is the lack of government interference. My point is that government interference is needed on a number of fields, and here we seem to agree. When it comes to software I do not have specific ideas on how to do this, mainly because I am no expert on the field. I love that discussion to those who know better. On other fields, like energy production I have more specific ideas. For instance I think energy production, water deliveries and other basic infrastructure should be delivered by society-run companies.

Bjørn: You talk about decentralizing control of the economy, but as long as you rely on the government, you rely, in effect, on a small number of experts making decisions based on their limited understanding of a complex system.

I do not rely on the government. I rely on the society. I want to include more not less people in the process.

Bjørn: It is possible that you have thought through all these issues already, and can account for how you intend to solve them, but I haven't seen any sign of it, and I suspect that what you have is an idea of how you want things to work, not how they realistically can work, or can be made to work based on what we have today.

I have discussed these things quite extensively in study circles etc, but the limitation of this debate type might make it difficult to fully explain what I think. Furthermore, I do not have a roadmap for reform, as I do not believe in making a complete setup for society that is going to go bing and then work.

Society is too complex for that. I am sure you agree.

Obviously, however, everything can not function on a purely local level. The way to stop central government interference where central government should not interfere is obviously the same as stopping the risks of the free market. Through legislation.

Is my model riskfree? Absolutely not. Is your model riskfree? Absolutely not. Is my model without problems? Absolutely not. Is your model without problems? Absolutely not. They are models. Models does not fully work in real life, its like trying to run an old printer on a new computer system - it can lead to all kinds of errors.

On many areas both regional, national and international cooperation is necessary. Some of this cooperation will happen as a result of private initiatives, others as a result of society initiatives. But basically, I think a decentralized and more direct democratic system can be introduced to reforming the current system. Thus we will see what reforms work and not. For the democratic reforms, I picture the introduction of more referendums and a system where the people is also involved in for instance the budget process, like in Puerto Allegre in Brazil.

For reforms in the economy, we could start by blocking new privatization efforts in fields that should be under society control, like the privatization of water resources we see some places in the world.

Then we could start deprivatizing important local infrastructure companies, for instance in power production. Gradually, local authorities should be given the power and ability to create new companies it other central areas where their offers are of a type that should be available to anyone regardless of economy etc. Personally, I can think of several areas the society should engage more in, but obviously this should be a result of a democratic process and not of my dictatorical voice.

In short: What I suggest is to keep the healthy dosis of socialism the western social democracies have, not to abandon it. Further I suggest to decentralize these societies. Lastly I suggest to introduce new fields to society control, on areas where democratic control over the economy would be more beneficial than it would be slowing, ineffective or even inachievable.

Bjørn: As long as this is done through legislation, (ie. not at the whim of bureaucrats), and is based on good science and sensible priorities, I'm all for it.

And there we agree. I am not sure we agree what is good science, though, but that is a discussion for the democracy again.

Bjørn: So reality does not agree with you.

Yes, it does. My point is not that capitalism and environmentalism can not coexist. My point is that for it to coexist environmental goals must be placed above profit goals, something that can be assured through legislation - that is limitation of the freedom of capital. My point is that capitalism is an utopical ideology, just like other ideologies, and thus that it is a question of what Utopia to choose. I prefer another one.

Bjørn: But you avoid my dilemma: If exploitation is both a product of poverty and the way out of it, then we should consider both together, and not exploitation alone.

I disagree with your description. I do not see exploitation as a way out of poverty.

Bjørn: Capitalism is by definition an economic system based on individual freedom.

No, it is based on freedom of capital.

Bjørn: You insist on limiting this discussion to economic affairs, (which is why you talk about capitalism, and I talk about individual freedom), but what is really the difference?

The difference? The difference is that I do not disagree with you on any of the fields you talk about there. I do not propose centralized planning for for instance science. I propose a decentralized socialist society. In my opinion, such a system would provide for individual freedom in a far better way than capitalism and especially than centralized capitalism, which is the de facto capitalism of today.

Øyvind

Kim Sook-Im,US | 2005-02-09 12:07 | Link

petter wrote:

"Kim: Are you familiar with the Japanese band Shonen Knife. They got a tune called Ah, Singapore".......

.........Yes the Lyric about chewing gum has some truth...the singaporean government can get a bit draconian over silly things like chewing gum..i understand there is a modest fine for littering with chewing gum. However i like their airport..where smokers have to walk a hefty distance to use the designated smoking area ! No more COPD Inducing 2nd hand smoke to bother me in public places LOL

Herbie NY, NY | 2005-02-09 13:24 | Link

Oyvind I have reread your latest posting several times and still do not see a rational for what you propose. For example, what is the measuring tool you use for more government involvement? It would seem to me, in the first instance, that the best tool is whether a service can be given (no pun intended) more efficiently and cheaply then the alternative. If it cannote then it would also seem that you must provide a convincing rationale for government delivery of such services.

Totoro, U.S. | 2005-02-09 15:07 | Link

Oyvind . . .

Hmmm, that's odd. I'm writing you on a Mac iBook. How can that be if Microsoft owns everything?

Totoro, U.S. | 2005-02-09 15:14 | Link

Oyvind . . .

I'm sure you've heard the story about the helicopter pilot lost somewhere in a fog near Seattle with his radio malfunctioning. Passing by a tall building, he held up a sign asking, "Where Am I?" Soon came the answer from sign in a window: "You're In A Helicopter."

Using this info, the pilot plotted his course to the nearest airport. Asked how he could do this, he replied, Where else but the Microsoft Building would you get such precise but useless information?"

Øyvind, Bergen | 2005-02-09 15:42 | Link

Totoro:

Oh, yes, it would be if I said what you dreamt that I said. But I did not. Go back to start.

According to OneStat.com this is the stats for operating systems of Internet users: 1. Windows 97.46% - 2. Macintosh 1.43% - 3. Linux 0.26%

http://www.onestat.com/html/aboutus_pressbox10.html

By the way, I personally belong to the third of those groups.

Øyvind

Øyvind, Leuven | 2005-02-09 16:04 | Link

Of course, Linux is doing better on the server market (read: computer geek market):

http://www.itfacts.biz/index.php?id=P2438

And the Penguin is storming ahead.

Øyvind

Øyvind, Leuven | 2005-02-09 16:05 | Link

Totoro:

Thanks for giving me a good laugh, anyway :). Made my day here at the helpdesk somewhat better.

Øyvind

Kim Sook-Im,US | 2005-02-09 17:33 | Link

Yes i am against the death penalty and Singapore like the US are countries that still execute people fo various crimes. This is most regrettable and certainly pressures should be placed on those countries that still use the death penalty ( based on outmoded psychology) as a deterrent . With regards to the use of cruel and unusual punishment one is immediately reminded of such practises that abound in islamist countries world wide LOL and curiously it is in these category of countries where there is a deficit in economic well being and a dearth in capital...could there perhaps be a cause-effect relationship between religio-cultural backwardness and economic depravity???? Such observations certainly lend credence to Hayeks premise of the creative powers of free civiilizations as opposed to the destructive and constrictive nature of societies upon which are imposed a draconian fatalistic theocrato-
fascistic system ....to wit - Islam as a prime example ( the gross GNP of several failed islamist states do not even approximate that of a 'as yet' free civilization like that of France - Oui ! Oui! )

Nevertheless the fact that Singapore has 'disinvited ' the Jehovah's Witness and the Unification church ( both of which in reality are Cults , albeit not in the genre of viciousness comparable to that of Ikkkslam )is quite trivial in comparison to the large scale persekkkution and even slaughter of religious minority in supposedly 'freedom-house-democratikkk' societies in which Ikkkslam prevails ( namely our much vaunted exquisite freedom-house-approved republic of Mali).Our erudite Mr.Oeyvind's genteel attempt to besmirch the good name of Singapore by comparing a rather benign act of disinvitation of two reknowned and annoying cults like the Jehovah's witness and the Moonies cannot be very successful in view of the fact that poster-boy Abdul MALI of Freedom House is fast becoming unravelled in it's experiment with Democracy....again proving that where the destructive and constrictive ideology of Islam prevails there can be no Democracy a la Freedom House or otherwise LOL.

I for one certainly wish the Malians well and fervently hope that theirs will culiminate into a full blown democracy with all its advantages. Nevertheless despite the wishful thinking of many apologists who would like to believe that Islam can engender much less support Democracy , they should think twice if they would familiarize themselves with the basic tenets of this Cult. The resurgence of Islam bodes ill for Freedom House Mali ---->

http://www.worthynews.com/news-features/spread-of-islam.html

Sister Ayesha Kim

Bjørn Stærk | 2005-02-09 19:40 | Link

Øyvind: Microsoft has not been able to eradicate the competition, but these days they are almost sovereign when it comes to personal PC operative systems.

They are large, yes - large and often unethical. We already agree on that. What I'm curious about is what the problem is, why you think it is serious enough to intervene, and how you believe that should be done. How does Microsoft's popularity restrict your options as a computer user? Does it prevent you from buying a Mac? Does it prevent you from installing Linux? Do they harm you in other ways? Again: Be specific.

You work with computers, so you must know that Linux is a formidable desktop alternative to Microsoft, as is open source software for Windows. The elementary school my mother teaches at switched to OpenOffice a while ago. Saved them a lot of money, works great. Now they're experimenting with a Live-CD distribution of Linux aimed at schools, Snøfrix. Easy to use (no installation), all kinds of useful software. I won't be surprised if they switch entirely to Linux within a couple of years. There are few reasons for a regular user to strongly prefer Windows over Linux, and it has become very easy to switch. One of the reasons left is gaming, but in that market Microsoft faces an even stronger competitor in Sony. Then again there are few reasons for a regular user to strongly prefer Linux over Windows, which is why inertia favors Microsoft. This is not the same as Microsoft abusing its market dominance.

There are several ways for you to prove that Microsoft has become so large that it undermines the freedom of the market. One way is to show that Microsoft effectively eliminates its competitors, (it doesn't). A more indirect way would be to show that they feel so secure about their position that they no longer bother to be competitive or innovative, that they're just cashing in on old success, safe in their knowledge that they can hold on to their users by sheer market power. But that is not the case. Take Windows, their flagship product. Over the last 12 years, I've used MS-DOS, Windows 3.1, Windows 95, Windows 98, Windows NT4, Windows 2000 and Windows XP. Every single one of those upgrades has been worth it. Do you remember how buggy Windows 95 was? Do you remember how long bootups used to take before XP? And look at everything they did to overhaul XP security with SP2.

Then there's the part of Microsoft I see as a developer. I remember when any serious Windows software had to be written in C++, and required intimate knowledge of the Windows API. That changed with Visual Basic version 5 or so. Visual Basic 6 was an improvement, (I wrote web components in it for three years), and Visual Studio .Net a minor revolution. Trust me: those guys aren't complacent.

There's one exception: Internet Explorer. Although superior to Netscape 4, (which is why Netscape died), the functionality of IE6 is essentially the same as in IE4. Now they're paying the price. Use of Mozilla Firefox has exploded over the last year, and deservedly so. Which tells us than even when unusual circumstances allow a company to maintain a 99% market share by dominance alone, their position is unstable, and unlikely to last very long. In the OS market, Microsoft has accomplished this only by taking its competitors seriously. You can't bully people to use an inferior product.

I do not rely on the government. I rely on the society. I want to include more not less people in the process.

The number of people is irrelevant. What matters is the number of people acting independently. You talk about decentralization and democratization as if they were two aspects of the same idea, but they are in fact contradictory. Democratization centralizes decisions by delegating them through a small number of elected politicians. So where you had 4 million individuals making their own decisions about which power company to use, after your reforms there will be no more (and probably far less) than a few hundred decision-making entities.

My point is that for it to coexist environmental goals must be placed above profit goals, something that can be assured through legislation - that is limitation of the freedom of capital.

Yes, but I'm curious where you got the idea that capitalism must prioritize profit over anything else. That's certainly not the capitalism I'm describing here. There are utopian libertarians who believe such things, but anyone who lives in the real world sees the need for pragmatism.

Herbie NY, NY | 2005-02-09 20:41 | Link

Bjorn you say "I'm curious where you got the idea that capitalism must prioritize profit over anything else"

Well it does. That is its nature. So what? The fact that it does does not mean that it does not take into account other issues. I've sat on the boards of several large companies. I've found that most, if not all of the board members I've interacted with have a highly developed sense of morality. The only issue they need to know is "what are the rules". The fact that they set policy in a competitive market place that injures others, e.g. others lose, is a measure of the fact that they do their job well. Their job is to produce a superior product and legally force others out of the market. That, it seems to me, works to the benefit of the market and the consumer. If societyis to advance -- at least materially -- then the market should weed out poor competators and allow for the retraining of the woerk force.

Totoro, U.S. | 2005-02-10 01:27 | Link

Oyvind . . .

Now I'm confused. Are there two Oyvinds--one in Bergen and one in Leuven?

Bjørn Stærk | 2005-02-10 07:55 | Link

Herbie: Well it does. That is its nature. So what? The fact that it does does not mean that it does not take into account other issues.

Yeah, that's what I meant. I wouldn't say it prioritizes profit as such, though, because individual freedom is so much more than that. The blogosphere is a wonderful example of what individuals can do without coordination, but profit plays only a small role in it. There are fundamental similarities between writers forming a network of blogs that can think up and distribute ideas, and companies forming an economy that can invent and distribute products. Just different aspects of the same freedom.

Øyvind, Leuven | 2005-02-10 08:56 | Link

Totoro:

Sometimes I am homesick. That is all.

Kim Sook-Im:

Since your last post is completely off-topic I have answered on the open thread about Islam.

Øyvind, Leuven | 2005-02-10 13:31 | Link

Microsoft obviously is not all bad, and they have got many excellent programmers. But they have used their sovereign market position pushing competition over the line, and I do not agree with your description of what happened in the Netscape / IE-competition.

I think the factor that IE started coming as a standard on computers is the most important factor, and this was achieved through Microsofts superior position on OS for brand-new computers. I see similiar tendencies when it comes to other Microsoft products, that are used more than their quality, in my opinion, justifies. An example is their Media Player.

Is these problems with MS serious enough to invervene? Yes.

How to intervene? As mentioned, I do not feel I have enough knowledge on this to give you a model for intervention. Legislation and judicial processes is one alternative, already followed in the States. I also regard closed sourcing a problem on many fields, and the best way to intervene here is of course to do as the people on your mothers school - go for open sourcing instead. In the present day situation the Norwegian government should seriously encourage schools, public offices, libraries, etc. to change to open source software like OpenOffice and swapping to Linux might not be a bad idea either (though there is a need for more software).

The Electronic Frontier Foundation might have some other good ideas: http://www.eff.org/

Then for another discussion.

Sometimes democratization and decentralization will, as you correctly point out, work against each other, at least if you simplify the matter. Putting power plants under democratic control and ending competition will mean that the choice of the free market disappears.

However, when put under democratic control this means that the very same people that can no longer choose amongst different providers are given more influence over the politics of the power plant. A choice is to be made; influence only through the market, or a another influence through direct or indirect democracy.

If the market is chosen invididual have more freedom to choose between different providers. That is A individual freedom, but it is not THE (only) individual freedom. If society control is chosen the individual may lose the choice between different providers, but he gains more freedom to influence political choices that are today exempt of popular influence. That is also A individual freedom. Which one do you choose?

If the latter one is chosen more people will be involved in the process of deciding matters that are important for a societies development. That is both democratization and decentralization.

When power suppliers became - formally - privatized; things like the prize of electricity, that used to be politically set, was no longer under political control. The question is obvious: Should it be? Should one type of individual freedom - the one given through the freedom to choose between two different power suppliers - be considered superior to another one - the freedom to influence prizes on electricity politically from for instance social or environmental factors? Should decisions that are important to society be left to private persons with profit interests, merely because society is complex?

"Yes, but I'm curious where you got the idea that capitalism must prioritize profit over anything else"

Because profit, Bjørn, is the central tenet of capitalism - not individual freedom. For capitalism to even survive, economic profit is needed. Of course, any given company owner can choose to prioritize other issues, but then she risks losing in the competition against other and more ruthless participants in the market.

The only way to force environmental issues, for instance, to the top of the agenda is through legislation, that is through limiting free enterprise.

The European welfare states has been created not only through their economic success, but also through these very limitations. Yet some seem to strive to abandon these, regarding them as limitations on invididual freedom, when in fact they are there in defense of OTHER individual freedoms.

Øyvind

(Sorry about the lack of HTML-code in my recent posts. The keyboard I am writing on is not familiar to me and I can not find the right tags).

AlanC | 2005-02-10 14:48 | Link

Sorry Oyvind but I've got to call you on this one:

"Because profit, Bjørn, is the central tenet of capitalism - not individual freedom."

Profit IS individual freedom!!!!!!!!!!!

The whole idea of economic liberty is that the owner of a resource gets to set whatever price THEY want and the buyer gets to buy it or not. If a seller consistently over-prices his commodity competition will eat him alive.

All economic activity has its beginning in one, two sided concept. Private property and ownership of your own body aka labor. Just because economic development has gotten so large that these connections are now complicated doesn't mean that they don't exist. There is no "... freedom to influence prizes(sic) on electricity politically... ". Since all politics rests on the base of force ( don't obey the law the police come with guns ). There is NO, ZIP, ZERO, ZILCH right for anyone to effect anyone elses property or what they choose to do with their labor.

Obviously the right to private property has been compromised by force to some degree in every society. In the US its called Eminent Domain. Various levels of government have been abusing this concept and certain court decisions have started to redress the problem. But, make no mistake Eminent Domain has nothing to do with freedom or liberty. Price setting is nothing more than virtual Eminent Domain coercion. The owner is coerced into doing something he wouldn't do himself with his own property!!!!!!!!

This is similar to restrictions on a more widely recognised right; the right to Free Speech.

We have agreed that certain speech can be curtailed like the non-controversial prohibition on yelling "FIRE!" in a crowded theatre. From that clear case you get foggier and foggier.

Same thing with property rights. Almost everyone agrees with seizure of private property, with fair compensation, for critical public purposes. For example, building a dam to prevent catastrophic flooding. BUT, this is STILL coercion if the owner of the property didn't want to sell.

Capital and labor are both property to the owners there of and the government should not be allowed to force the owners of either to sell or rent their asset for terms that the owner doesn't agree with. No price control or wage control is liberty no matter how many people vote for it.

Democracy can easily become a tyranny of the majority in economic matters.

PS Oyvind I sympathize with your keyboard trouble, I've had to type on a German keyboard....now that was fun 8^P. From your "prizes" I assume that the z and c aren't quite where you expect.

Øyvind, Bergen | 2005-02-10 16:34 | Link

Alan,

Actually, the "prizes" is just a silly typo. Repeated several times.

We can agree that the right to make profit from ones own property is about individual freedom.

The question is, however, whether some kinds of enterprise should be society-run, to ensure democratic rights to influence them, instead of private-run. I am sure most of us can think of some types of "business" that should be society-run. Even the dreamy libertarians think that police and military should be society-run. Most of us can also think of things that should not be society-run. Even some of the nuttiest commies.

Although, I have to say, I have encountered people claiming to want for a system without private property whatsoever...

Personally, I think the question should not be what people are entitled to do with their own property - I do not have the same utopic fantasies as those mentioned above - but rather whether important infrastructure companies, for instance, should be common property, and what areas society (state, province, city, county) should run companies in and what fields it should stay out off.

In my opinion a number of areas should be governed democratically through the use of common (actually, communal) property.

"Democracy can easily become a tyranny of the majority in economic matters"

True. It can easily become a tyranny of the few in all matters. But it is the best system we have got, and in my opinion that is true also for a number of matters considered to be economic matters. One way to try and avoid tyranny is through the decentralization of power.

Øyvind

Øyvind, Leuven | 2005-02-10 16:37 | Link

"tyranny of the few" was of course meant to be "tyranny of the many".

Bjørn Stærk | 2005-02-10 17:49 | Link

Øyvind: I think the factor that IE started coming as a standard on computers is the most important factor, and this was achieved through Microsofts superior position on OS for brand-new computers.

That was the trigger, but remember that IE really was superior to Netscape 4. It was less buggy and faster. It wasn't so much better that 99% of the world's Netscape users would have gone to the trouble of downloading it, but it was sufficiently better that anyone who had both installed on their computer would be likely to switch to IE. You might say that Microsoft bought the attention of internet users with their ability to have it automatically installed, but they convinced them to switch only by offering a better product.

In the present day situation the Norwegian government should seriously encourage schools, public offices, libraries, etc. to change to open source software like OpenOffice and swapping to Linux might not be a bad idea either (though there is a need for more software).

I'm all for that. Many parts of the government rely on platform-dependent software, (often designed particularly for them by small companies, because there's no generic market for such products), but those who don't should be encouraged to try Linux, or at least replace MS Office with OpenOffice. But the government should not forbid or punish use of Microsoft products elsewhere, nor should the US government punish Microsoft for merely being popular. Because that's what they're guilty of. People like Microsoft products. They're not always superior in the views of everyone, (expert users have more advanced needs), but they're always good. There's nothing lazy about XP, .Net, or Encarta.

I thought we were above hijacking words for their feel-good value. Isn't it clear to you that you're describing two different kinds of freedom, and that they need two different labels? Fine, call the second kind "individual freedom", then I'll call the first "foobar". The problem with "individual freedom" is that decisions are made through slow and unreliable political organs, run by often cynical or dogmatic politicians, who are elected by a majority that is often victim of hysteria and ignorance; who in practice are often controlled by media image concerns and highly visible special interest groups; and who often delegate considerable authority to unelected bureaucrats. Even if you start with a good idea, it is likely to be corrupted by the time it has gone through the political pipeline. The strength of "foobar" is that the individuals whose interests in the end we're promoting, make decisions based on their intimate knowledge of their own needs and resources, which directly and immediately affect the market without noise.

(I'll go back to calling "foobar" individual freedom, but for the purpose of our discussion I encourage you to mentally switch the words while you read. I honestly don't care about feel-good terminology squatting, I just want precise definitions.)

For capitalism to even survive, economic profit is needed. Of course, any given company owner can choose to prioritize other issues, but then she risks losing in the competition against other and more ruthless participants in the market.

For companies, profit is essential. For individuals, there are all kinds of motives. There's nothing wrong with profit, but an analysis of capitalism that deals entirely with profit is superficial. The freedom of companies to make money is just a subset of the freedom of individuals to use their own resources, skills and knowledge towards their own personal ends. This may not be "real" capitalism to you, but I don't see a difference.

The only way to force environmental issues, for instance, to the top of the agenda is through legislation, that is through limiting free enterprise.

Your map doesn't fit the terrain. Your map tells you that this must be so, that environmentalism is incompatible with capitalism, but the reality is that environmental laws have been introduced in every form of capitalism we know about, from Sweden to the US. (The real disagreement is over science and cost/benefit, which is a logically separate issue.) If this in your view means that the US hasn't implemented "true" capitalism, then you're making the same mistake as islamophobes who believe that only Islamism is "true" Islam. That makes you the utopian, not I. Everything I've written above deals with the real world, with ideas we already know, from decades or centuries of experience, actually work.

"tyranny of the few" was of course meant to be "tyranny of the many".

Though it easily becomes that too. ;) Government by the experts, for the experts.

AlanC | 2005-02-10 17:51 | Link

Oyvind,

I figured your Z / C mixup was keyboard related cause the German keyboard I used had the Z in a different spot and I got Zs in the weirdest places. Typos I'm VERY familiar with regardless of the keyboard 8^(

You are, of course, right that once you remove the extremes everything becomes a question of where to draw the line. The canonical absurdity on the Libertarian side was a discussion I had in college (oh so many years ago) about how lighthouses should be private and how you charge for the service they provide. Even the most fanatical Libertarians agree that Police and Military should be public. After that it gets fuzzy.

The problem is that with a public enterprise there is no motivation for cost savings and control of quality or price unless there is competition. Since there is no other government to compete with, you have to compete with private enterprise, but, if you have competitive private enterprise, why do you need the public one?

A great example of this issue is postal service here in the US. The US Postal Service was a government agency that had a legal monopoly. It became fat, bloated, costly and inefficient. In an attempt to solve some of these problems it became a quasi-private government agency run on the basis of profit motive, but, with gov't subsidy. Then along came FedEx and challenged the monopoly. Freight hauling was always private, but, what's the difference, in principle, between a truck load of pipe for a warehouse and a single book for a house? So, the government agency now had competition and everyone's choices improved and prices generally went down. The only way the Postal Service continued to survive was that there was still a distinction drawn between mail and freight and mail is still a USPS monopoly.

The issue that causes most problems is that private enterprise might not serve ALL the people with a service that is deemed critical. Using the USPS example again, the USPS delivers mail to anyone anywhere. A private carrier might not have an economic reason to do so. If you live in Montana where there are 100 people spread out over a thousand square miles, it ain't real profitable to deliver mail. So, if mail is seen as a critical need and if private enterprise won't fill the need for some people, should the government step in? Of course if you say that yes the government should step in on critical issues you can have all sorts of fun deciding what is and is not critical.

The major cases that you can make for public enterprise are all in the infrastructure area, though true Libertarians will argue all of them...roads, mail, fire dept, airports, electrical grid, rail road tracks and terminals NOT trains themselves, water, sewage, phone and maybe a couple more. Now, technology is allowing some of these to become competitive. Sometimes the government does the same thing as private enterprise in my Montana example, e.g. I have my own well for water and my own septic system because it was not cost effective for the town to extend the town water and sewage out to my little corner of heaven.

There is little need for government involvement in phones anymore. There is competition in electricity. That's the direction we should keep moving in, NOT increasing government regulation or ownership. There is nothing as sure to be a disaster than a mix ( See California electricity "deregulation". They deregulated the cost structure, but kept the price structure. Costs went up, price didn't, companies go bankrupt, consumers don't get electricity, ooops)

Capitalism is by far the most efficient and effective way to generate and distribute goods and services. All your innovation and best prices come from the profit motive. Unfortunately it is up to PEOPLE to perform capitalism and too many of them have some other uses for the profit motive, like getting filthy rich in any way shape or form. These people are not above using coercive methods either getting government to be their thug or hiring private thugs (see the pre-1930 robber barons and the labor movement) to build their businesses. Of course LABOR has done the exact same thing once they got powerful.

This is not a case of poor exploited labor and greedy capitalists, it is a story of greedy power hungry people trying to fatten up in whatever ways are available.

The role of government has to be that of rule maker and enforcer and not player. Once government becomes a player it will start playing its own side of the power equation to the detriment of "the people".

Paolo Riccardi | 2005-02-10 19:35 | Link

I had a question ,a group in Venezuela(www.petroleoparaelpueblo.tripod.com) is promoting a proposal to transfer public property from oil Industry(Pdvsa,Citgo,Veba Oel),that is State owned to people through mutual funds and social security, at large in that country;them says it is based upon a Norwegian Model,¿This is truth? is Oil Industry in Norway owned by people? This is no suposed to be a State corporation(Statoil),I have reads there are an Oil Foundation there in order to finance social projects,but the norwegian model is for real? or it is a scam?.

Gill Doyle, California | 2005-02-10 20:12 | Link

Americans are used to a more capitalistic society, in which government is always suspect (a heritage maybe of our experience with British tyranny), while Europeans are now used to a society that relies on government for many of its services. Since each side is pretty well satisfied with what it's achieved, neither is convinced that it needs to change what it's got. And so we find Herbie and AlanC and other Americans here arguing for what they're used to (and even, maybe, less government control than what they've got now), while Øyvind is inclined to promote government control of services that an American might prefer to see left to the private sector. I don't think that either side sees an urgent need to change its approach to government, though each can be expected to tinker with their systems. I am convinced, for example, that the U.S. will someday have a form of universal government-insured health care. The Europeans, on the other hand, may decide (as England did some years ago), to reduce government control in certain areas.

What we have to try to avoid, I think, is bias -- that is, an unreasoning attachment to one view or the other. And so, when Øyvind argues that government ownership of industry will somehow enhance the democratic experience, I suspect that it is democratic fervor, rather than a need to solve real practical problems, that accounts for his preference. We Americans, on the other hand, should consider the possibility that a small country, like Norway, may have practical reasons to rely more on government for services like mail and transportation. When a country's population is small, it's no doubt more difficult to raise capital, and competion will be limited. While Norway is a small country that might, for good practical reasons, have turned to government for solutions that private enterprise could not provide, France and Germany are large countries that have no good excuse. The preference in France for socialist solutions is more religious than practical.

Rune Kristian Viken, Oslo | 2005-02-10 20:16 | Link

Paolo Riccardi: I'm no expert on the subject, but I'm a norwegian.

Statoil is indeed owned by the Norwegian State, but it's not the only company operating platforms in the North Sea. There are several companies, which are privately owned.

However. There is one very important twist to this. The oil companies pay taxes. Heavy taxes. If I'm not greatly mistaken, the taxes the oil companies pays on their oil is around 80% of the profits. In other words -- most of the money goes straight to the state.

I've not heard about the "oil foundation" that finances social projects. On the other hand, we've got an "oil fund" - which is a quite large fund which in the future will be used for pensions and so forth. It's Norway's "savings account" - sort off.

So - in other words - Norway has both state owned and privately owned oil companies. All pay _extremely_ large taxes on their produce, which again goes into the oil fund. This again, is norways savings account for the future.

Hope that answered your question.

AlanC | 2005-02-10 20:36 | Link

Gill, you are of course right about the differing systems and the background of societies that implement them.

The topic of the thread, however, leads me to discuss the economic system in terms of Liberty.
If you believe, as I do, that all rights adhere to the individual then you must look at economic systems that fall most heavily on the side of individual liberty. State ownership doesn't cut it in that sense and, in fact, it has been proven throughout history that capitalism is the best system for delivering goods and services to everyone.

That is IF your definition of best includes most efficient, most effective and most innovative. If you definition relies primarily on most egalitarian result then capitalism doesn't come out so good. But, is poverty forcibly distributed evenly superior to having different levels with only a few in poverty?

Øyvind, Leuven | 2005-02-10 21:20 | Link

Bjørn:

Word squatting? To me it seems like you are trying to monopolize the very concept of individual freedom. But what kinds of freedoms are not individual? In a previous post you talk about spiritual freedom, physical freedom and then individual freedom.

But is not the first an individual freedom, and is not the second? Does the powerless person have invididual freedom? Has not the person whose spiritual freedom has been taken away from him through the use of coercion and forbidding books and songs and art lost individual freedom? When someones political freedom is taken away, is that not invidivual freedom stolen, too?

In that previous post you also wrote about freedom as absence of coercion - "independence from the arbitrary will of another". Now, how should democracy be classified? As mob rule? As anti-liberty? No? Didn't think so...

Of course, you say that individual freedom will be limited, even that it has too be limited, but that individual freedom should always be the ideal. Fine. What individual freedom? Can you not see that different individual freedoms are sometimes in conflict with each other (and this even without including some mystical inner freedom, cocaine and Norwegian tobacco laws in the equation)? Pretending only one individual freedom exist does not work for me.

You quoted Hayek: Whether [a person] is free or not does not depend on the range of choice but on whether he can expect to shape his course of action in accordance with his present intentions, or whether somebody else has power so to manipulate the conditions as to make him act according to that person's will rather than his own.

Freedom thus presupposes that the individual has some assured private sphere, that there is some set of circumstances in his environment with which others cannot interfere

True. But does a society-owned postal service take away this private sphere? Hardly. Does a society-owned power station? A library? Or even, do I dare say this, a society-owned bakery? Or, to take an even more extreme example, factory? Does the existance of common property endanger the existance of "an assured private sphere, [...] a set of circumstances in [which] others cannot interfere"?

Oh, yes, a society having none of its factories on private hands could get all kinds of problems and would be ripe for many societal illnesses - ignorance and alienation undoubtly being amongst them. But is the lack of an assured private sphere one of them too? Or are there other factors than community-owned factories that kill of this sphere? Like heavy centralization of power, regardless of economic system? Or totalitarian rule, equally regardless of economic system?

Having a society-owned postal service does take away a range of choice, yes, and it can even lead to bloated bureaucracy and other bad stuff as Alan points out. But it does not per se take away individual freedom, unless we choose to reduce individual freedom merely to a discussion about how many different kinds of toothpaste are available at how many different supermarkets.

Somehow, you seem bent on making the freedom of capital the equivalent of individual freedom. But it is not. The freedom of capital is freedom of capital. No more. No less.

When I s