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No doubt, Kirzner is an excellent thinker. However, I do get a feeling that his theory of entrepreneurship is somewhat limited. As an Austrian economist, I do not understand why he necessarily limits entrepreneurial action to decisions following alertness to opportunities. It seems his market process consists of these decisions – but that the decisions are instantaneous. In this regard, Dr. Kirzner seems to escape the effects of time; after all, a decision is not what makes entrepreneurial profit – it is the decision followed by action. Also, since a decision and the carrying out of the action cannot happen instantaneously, there is a possibility for making errors (losses) through bad estimation/judgment or simply because one has limited knowledge of the future. [Read more…] about On Kirzner’s “Competition & Entrepreneurship”

[ad]It seems a lot of the criticism towards myself as well as my attempt to finally “unify” the anarchist movement, through stripping it of the dogmatic, false belief that there are incompatible schools of anarchisms, is based on the uses and definitions of the word capitalism. In endless posts on anarchist forums I have been attacked in person or indirectly through my writings for my being capitalist, while I’ve also been attacked numerous times by statist libertarians (a.k.a. minarchists) and anarcho-capitalists for not being a capitalist.

It seems obvious that both of these criticisms cannot be right, but also that one of them should. In fact, however, they are both wrong. I am both a very strong opponent of capitalism and believe very strongly that capitalism is synonymous with the only true free society.

The reason for this is not an inherent contradiction in my views, but lies solely in the dogmatic view of the critic. Those who criticize me for being a capitalist while “pretending” to be anarchist/libertarian see capitalism as an economic system very much like the one we have today. It is a system of hierarchy based on privileges. Capitalism steals from the poor and gives to the rich; it regulates, oppresses, and exploits those who aren’t in the right networks and those who lack the “right” contacts, and it rewards those who are loyal to Power.

Capitalism is in this sense but a newer version of old-style oppressive feudalism. Instead of local or regional lords with the permission from the monarch to tax and enslave their people, we have huge corporations given the privileges by the State to conduct business and reap profits at tax payers’ expense. These protected capitalists are as privileged as the feudal lords; their privileges are basically the same.

Even though many don’t seem to realize this, such a system is fundamentally based on State power. It cannot survive without a monopoly of violence continuously enforcing and upholding the privileges – there’s nothing inherent in production, trade, consumption or money that creates a privileged wealthy class with a “right” to oppress others. This is a state of things dependent on law, and therefore on the State.

When large corporations establish a new factory, without being concerned with former or neighboring property owners’ rights nor with the environment or whatever, they do so not because it is an inherently profitable move. It is only profitable because they have been given the legal right (privilege) to do so, and can thereby escape most of the costs arising due to the disrespectful choice of location, production process, plant size, etc.

The same is true with the enormous benefits of the so-called economies of scale available to contemporary corporations. There is no reason to believe bigger is always better; in fact, the opposite is often true, the smaller is better fit for a flexible and changing world, has lower costs (no bureaucracy), relies on its direct relationship with customers, etc. But the all-encompassing State continuously subsidizes big business through supplying public roads, free or cheap land and labor, tailor-made legislation and monopolies, or even corporate welfare.

The reason it is always profitable to grow and expand and become bigger is solely because of the State. A huge plant may be able to produce a monstrous quantity of products at a low per-item cost, but only through being able to exploit cheap labor and free or almost free transportation is it a great deal. If corporations were to bear their costs for transportation they would find bigger at a certain point becomes more expensive.

If this system is capitalism, I am absolutely opposed to it. If this is capitalism, I am an anti-capitalist to 100%.

But this is not in any sense what anarcho-capitalist thinkers mean by capitalism. On the contrary, anarcho-capitalists are as strongly opposed to this system of State enforcement and privilege for corporate interests – call it corporatism, capitalism, fascism, or whatever – as I am. To anarcho-capitalists, capitalism is everything the contemporary system is not (even though there are, indeed, a number of ignorant status quo-hailing anarcho-capitalists – just as there are a bunch of utterly ignorant “money is the true evil” anti-capitalist anarchists).

Capitalism to anarcho-capitalists is what individualist anarchists and mutualists refer to as the “free market.” It is the state of things without government, where trade is free and voluntary and something that individuals engage in if they find it in there interest to do so (and they often should). The free market, even though it may include large-scale production, sees no privileges and no special deals for corporations. On the contrary, in this free market capitalism there is no privileged class and also no one to hand out privileges.

Free individuals producing or exchanging goods and services, whether they do it separately or in groups/collectives and in a money or barter economy, do not create a system of privilege. If it were the case that free individuals voluntarily interacting with each other would always, through some kind of inherent nature of interaction, create hierarchies and structures of power there would be no chance for freedom. Ever. So it simply cannot be true that free individuals in voluntary interaction will be destined to create states and exploitative relationships.

Not even the existence of property would cause such a hierarchy, unless property itself is established by the State (and it cannot if there is no State). Property according to anarcho-capitalists is a right to use and control that which you have legitimately acquired – and this can only be done through directly mixing your own labor with that which is unowned and unused and unclaimed. Property, in other words, does not to anarcho-capitalists mean the same thing as de facto property is today. And a free market, even if based on the anarcho-capitalist definition of property, would not make the vast riches of the privileged class possible while keeping others in poverty; it would indeed make people wealthy, but the free market makes everybody wealthy – at nobody’s expense.

I, for one, do not fully share the view of property commonly advocated by some anarcho-capitalists, since I see great problems (philosophically) in the Lockean version of property acquisition that many anarcho-capitalists have basically adopted. Rather, I advocate a use-based approach to property that in a much better way makes use of the scarce resources in this world and also is better at both restricting ownership and allowing for more fair accumulation. It is a “softer” approach to property that literally takes the best of the private property and possession-right theories of ownership.

In either case, the anarcho-capitalist view of capitalism has nothing to do with the capitalism described above and used by the anti-capitalist anarchist schools. It is a seldom-mentioned and little known fact that Murray Rothbard, the anarcho-capitalist icon, was in favor of homesteading from the State – that e.g. workers have the right to take over their factories just like students and faculty have the right to take over state university campuses (see “Confiscation and the Homestead Principle” [pdf]). This should tell dogmatic anarchist anti-anarcho-capitalist folks something.

For the record, however, I do not call myself anarcho-capitalist even though I do use anarcho-capitalism as an example in this post. I am a market anarchist with views fitting nicely within the “triangle” of individualist anarchism, mutualism, and agorism – topped off with a little influence (but only a little) of Stirnerism. This view has a lot in common with much of anarcho-capitalism, no doubt, but it isn’t.

In general, I try to avoid using the word “capitalism” because it is so easily misunderstood, and because it seems a lot of people really don’t want to realize they are using it dogmatically so that they can continue to falsely dismiss people they don’t like (or don’t understand). I am nevertheless fully, completely, and absolutely opposed to capitalism in the former sense above, while a staunch proponent of capitalism in the latter. My views are, even though the same word is used in both the positive and negative, fully compatible. Indeed, since the word is used in two distinctly different ways – where one is almost the direct opposite of the other – it is necessary to be both pro and con capitalism. Unless your view prohibits people from freely and voluntarily interact and exchange favors, goods, and services – but that surely wouldn’t be anarchism.

[ad#righthandside-tall]It seems people generally consider strength as highly correlated with size. Big corporations are much more powerful than small firms or individual entrepreneurs, small states are “at the mercy” of bigger states, big people are more terrifying than small. Yet the wisdom of the ancient giants in structured thinking talk of size and strength as very different, even the Bible show how the “small” David beat the living hell out of the monstrous giant Goliath.

The instinct that size equals strength lives on, however, and seems to be something that we need to learn how to live with. But with size comes a large number of problems – there is a reason the dinosaurs, the giants who ruled the earth some 70 million years ago, died out, just like it is rather unsurprising that insects are generally thought of by experts as the most successful type of species. It would not be totally surprising if future theories of how the dinosaurs became extinct show how they were simply too big – how there simply wasn’t enough space, food, etc. for all of these giants.

The same goes for organizations. Extremely big organizations struggle with problems that almost cannot be solved – collective action and organizing problems, surveillance, control, and overhead costs, etc. A large organization is generally much more vulnerable than a small organization. Just like the case of dinosaurs, a large organization is difficult to change – it is simply too rigid, too inflexible, and too heavy for its own good. Small organizations have no problem, or at least very small problems, totally changing its purpose and internal processes – small firms can easily adapt to quickly changing environments or even move to new markets completely; large firms generally do not have this luxury.

But it is not only levels of flexibility and rigidity that differ between small and large organizations. Small organizations/firms can utilize individual employees creativity and strengths and thereby keep innovate and change, while large organizations usually have very fixed and specific job descriptions and do not encourage (in reality, even though they often do pay lip service) creativity and change – such things are “threats” to “how things are done.” The large corporation is not about production but about calculation – the production process is faceless and anonymous, just like the corporation’s employees. Any worker is but a part of the machinery and can easily be replaced, at least in theory.

Ludwig von Mises wrote about the problem of large-scale attempts to control people and streamline processes, even though the argument was mainly targeting socialism (as it existed behind the “iron curtain”). It is however equally applicable on any kind of large-scale, control-based type of organization, therefore also on the corporation and any other kind of large body of collective action.

According to the calculation problem and the examples given above, we should be able to conclude that small firms, just like any type of small organizations, are more likely to successfully survive than larger firms or organizations. Large corporations are destined to starve or suffocate due to their own size – they will not be able to keep up the change and innovativeness required in a market.

And this would definitely be the case unless large corporations were so heavily subsidized by the state. For instance, Sweden’s large corporations (LM Ericsson, SKF, ABB, Volvo…) usually pay zero taxes and are paid directly by the Swedish state to stay in the country. One would think such a great deal – paying no taxes but getting more benefits than taxpayers – should mean these corporations are highly successful and profitable. And they are, but only periodically – never over long time periods.

Back to the dualism of small-large. It should be noted that the news media often report on large industrial corporations “in trouble” that require government bail-outs to survive; we very seldom (has it ever happened?) hear about small firms having the same problem, or a whole market being wiped out as market conditions change. Part of the reason is that small firms that are unable to stay innovative and meet market demands may disappear from the face of the earth, but the impact of it is at best very small. A large corporation always has an enormous bureaucratic machinery with hundreds if not thousands of people pushing papers with the sole purpose of controlling the corporation’s production process. The impact of a large corporation going bankrupt is therefore greater and more visible.

But the problem here is not that firms go bankrupt – this has been the case since the very first firm was founded hundreds (thousands?) of years ago. The problem is that the regulated market is biased towards big, where the ignorant notion of “big is better” has been built into coercive policies of government – companies aiming to be big are much more interesting to the state than companies aiming to survive and stay innovative.

The reason for this is that the state is the greatest example of the calculation problem – it is a monstrously large bureaucracy trying to “fix” problems (which are usually caused by its very presence or previous policies) through increased control. The state requires the market to be static and oligopolist – it is much easier controlled if it is. A nightmare for political rule would be a true market, i.e. a market consisting of a large number of small firms constantly and continuously taking advantage of creativity, innovation, and using change as a tool to get better and provide better services. Such a market is literally impossible to control, foresee, and calculate.

If the state would step aside we would see the market change rapidly – the large corporations would almost immediately start falling apart and either disappear or implement highly decentralized organizational forms with rather sovereign organizational units. Without the privileges granted corporations by the state they would find themselves in an impossible situation – their costs would be too high, their production processes too rigid and slow, their overhead costs way too large. A freed market would be the end for the large, bureaucratic corporation – only a limited few might be able to survive, but it is unlikely that they would be able to survive for long.

David would not have been able to beat Goliath if the state tied his hands while injecting Goliath with energy. This is exactly what is going on in the market today, where regulations are supporting large corporations working as economic states with departments, policies, and bureaucracies. In a sense, the state recognizes its organizational brothers. But just like David was able to beat Goliath through using creativity and flexibility rather than brute force and reliance on size, the market rewards innovation and ingenuity if left untainted and alone.

Bigger is neither better nor stronger. Something big is much more likely to get stuck and is usually too big to find and take advantage of the multitude of opportunities. And if something goes wrong with something large, it has enormous impact. The fact is, smaller is superior.

[ad]Psychology and “average Joe philosophy” is quite frustrating while at the same time interesting and, to say the least, bewildering. We all have thoughts and convictions that we take for granted are true, and we often react emotionally and with great certainty even though a fraction of a second’s rational thought would prove our reaction dead wrong. Yet a lot of people, if not all, have knee-jerk reactions that are in no way based in rational thought, logic, or even facts. They are nothing but reactions, which seem to hover without being attached to anything of value, floating through space yet being constantly at your service when you need them.

Such a reaction is the terrible yet very common reaction to police brutality. Most people, in this age of dependent – rather than independent – thought, react when they see someone ruthlessly attacked by another person. Even if we do not intervene, we react emotionally internally – we feel disgust, perhaps hatred. Yet this feeling is often dependent on who the perpetrator is. If a person with a badge, let’s call him or her a “police officer,” would ruthlessly attack a stranger most of us would not react.

If a neighbor gets his door broken down and his belongings stolen by someone we feel sorry for him and do what we can to help this poor neighbor. And if we get to see who did it we might react violently. This is not the case if people dressed in fancy militaristic uniforms (costumes?) carrying a badge – they may break into our neighbor’s house, steal his belongings and drag him out in his underwear with arms tied behind his back.

In this situation, the only difference to some other thug attacking someone you know being a badge and a label, how do most people react – “I wonder what he did?”

You might react emotionally to this statement, thinking I’m unfair – and I believe most people reading this blog post would react the same way. You instinctively think it is illegitimate and unfair to compare police officers to any thug breaking down your neighbor’s door in the middle of the night. But why do you react like that? I haven’t said anything to make you believe the situation is different; on the contrary, I’ve described the very same situation and the very same sort of crime. The only difference is who did it.

I claim the action itself, the situation, is what should be morally valued, not “who” did it. Killing a person is wrong no matter who does it, unless perhaps in self-defense, just like stealing is wrong no matter who does it. Or would you say some people have the right to kill, some have the right to steal – while others do not?

I believe you do – I think you condemn some people for carrying out certain actions while you praise others for doing the very same things. I would even be willing to claim most people have come to morally judge people not depending on what they do but depending on who they are. And this is the reason we’re in this unbelievable mess.

Let’s exemplify this thesis, using the same examples as above. Killing and stealing are illegitimate, morally despicable acts – they are simply wrong . Do you agree? I think you do. Then we should morally condemn anyone who kills and steals not depending on who does it, but depending on the act itself and the situation in which the act was carried out. We might have understanding for someone being directly attacked and in desperation and fear for his own life kills the attacker. He is still liable for the act of killing, but his crime was a necessity so we might be willing to let him go – or at least not judge him as hard as if he was the attacker.

The same goes for stealing, where we would consider theft a bad act no matter the situation. We would perhaps be willing to think it okay for someone to “steal back” that which had already been stolen from him. Some would even consider it “okay” for someone starving to steal food or shelter – because of the need in a desperate situation. Along the same lines we would probably be outraged if someone in the middle class would steal from people in the neighborhood, perhaps even more so if it was a rich person.

What if it was systematic theft going on on a day-by-day basis by the richest body of organized crime there is? We would be so mad we wouldn’t be able to sit down. Unless we called that organization a “State.” The same is true for killings – we don’t judge people killing in the name of government the same way we judge others. Some would even go so far as to say people working for the government have a “Right” to kill.

Consider again the thug, or perhaps a gang of thugs, breaking down your neighbor’s door in the middle of the night. They sneak up on your neighbor’s house and smash the door, running in shouting and with guns in their hands. Your neighbor wakes up terrified, reaches for whatever means of protection he has in his bedroom and uses it on the first one to enter the door. The thugs shoot back and literally fill the walls with lead. There isn’t much left of your neighbor.

This would be a terrible crime.

Now imagine the thugs were a lot faster and were able to break into his bedroom and tie him up before he could stop them. He was only able to hurt a couple of them, but didn’t kill anyone. The thugs carry him out in his underwear to their truck and tell all neighbors showing up that there’s “nothing to see” and that there is no need to worry. All they will do is take this neighbor with them and lock him up at their house – they promise he will get “fair” treatment, but since he harmed a couple of them he must be severely punished.

Unfair?

I would say it is. But this is a story that has happened a number of times the last few years in the United States, and every time the neighbors have reacted by thinking their neighbor must have done something wrong and that he “had it coming.” The reason? The thugs were waving badges and calling themselves “police officers.”

The automatic reaction of the neighbors were not “Oh my God! What are they doing!”, which would supposedly be the “normal” reaction, but “I wonder what he did.” The neighbor is not innocent until proven guilty, but rather immediately judged and forgot – by people who have known the person for years. All because the thugs carrying out the break-in were licensed by the State and therefore labeled “police officers.”

In many of these recent cases, which are all available on e.g. YouTube and in the blogosphere, there has been no reason whatsoever for the “police” to storm that specific house. In some of the cases, they have simply misunderstood the address; in others, they had received information from someone saying the person living in the house was committing a crime. In most cases, they suspected the person for having drugs such as marijuana – which obviously is enough reason to break down the door in the middle of the night and attack someone sleeping peacefully in his own bed.

Now you probably wonder what happened to the people involved? In most cases, the person being attacked by the “police” was charged with assaulting police officers, since they were hurt by the person trying to protect himself. The police officers were almost to 100% freed of all charges if they were at all investigated. The only thing we can learn from stories such as these is that the police can do no wrong, not even if they attack you in the middle of the night in your own home without any reason to do so, whereas you are in deep trouble if you try to defend yourself. Next time you are the victim of a burglar (or police officer), make sure to passively accept whatever is coming your way.

Now, this may seem unfair to the “poor” police officers attacking defenseless people in the middle of the night. But this is not an attack on the police or even on any individual police officer. This is an attack on you. The reason these things happen and will go on happening is because people like you react just like you do: when someone is brutally attacked you react in defense of the victim – unless the perpetrator is wearing a uniform.

Murder is wrong and both of us would probably be scared to death seeing a killer on our street, but you would cheer and feel pride if the killer was wearing the State’s uniform. I would not. Assault is wrong and we would be terrified if a gang of thugs would attack us or someone we love or hold dear, and we would take sides with the victim – but you would most likely choose to see the perpetrators as victims if they are wearing uniforms.

What is it with a uniform that makes a vice a virtue? Let me tell you a secret: there is nothing with a uniform that gives you the right to kill, pillage, destroy, and attack. The villain here is not only the person committing the crime – i.e., carrying out the attack – but to a great degree you. You are the problem with this world, for as long as you react not to the crime but what the perpetrator is wearing there is no hope for this world.

As I said, I’m not writing this as an attack on police officers even though they definitely are to blame for a lot of wrongs. This is about you, your crimes, and how your corrupt morality is destroying this world. You are an accomplice to murder, rape, and theft – unless you rethink your morality.

[ad]I get a lot of comments on my articles at the time they are published as well as years after they have been made available. This blog entry is about the comments I receive and why so many of them are supposed to make me look stupid, while they are really making the commenter look stupid.

There are many things one could discuss with respect to the people commenting on my articles (I do appreciate all comments, by the way), for instance that some seem to think they don’t have to mention which article they are commenting on. And it seems to not matter if the article was recently published or was published five or six years ago. I am no mind reader and thus I cannot understand the comments and even less rebuff the criticism (which makes me think that sometimes it is a conscious choice to not tell me, only to not have me respond).

But I would like to focus on a couple of general comments that so obviously miss the target that they make the commenter look really stupid. I realize the comment is itself a rather lame attempt to talk down the article without having to discuss the contents: the details in its reasoning or the arguments supplied. To some extent the comments are definitely made only to make the author of the article commented upon look bad, while in other cases it isn’t as obvious. Let’s have a look at two of the most common comments.

“The article is too black and white”

This could mean almost anything, but the point is probably to say that the article is unrealistic and shouldn’t be taken seriously because it exaggerates the positives and negatives. However, when trying to make a point most authors and debaters exaggerate to make the point clear. After all, the point of the article isn’t the exactness in which it describes details of reality – there is an underlying point that is made, and which is made clear through consciously distorting reality somewhat.

This is not a conscious attempt to deceive the reader, even though this is what the commenter seems to suggest.

“The article doesn’t cover all the arguments”

This is possibly a favorite of mine. It is simply too dumb to take seriously. What does it mean to “cover all the arguments”? And even more importantly: is it possible to ever cover them all? In an article?

Pointing out that there are better arguments is clearly a better approach, even though it too misses the target. The purpose of an article can very well be to present one argument for something so that the argument can be discussed in itself; it might not be an attempt to actually argue at the best of one’s ability for something. But this point is obviously way too advanced for most commenters, since most of they seem to believe an article can only deliver the best of arguments – and if it doesn’t, the article simply isn’t good enough.

But even if “the best” argument is covered in the article, it is still possible to say there is one more argument that can be made and that the article doesn’t discuss. I don’t see how this kind of comment could ever be considered valid criticism. The author of an article is most likely trying to make a point, but he or she might not choose to cover all possible arguments – it might even be better (as in more efficient or convincing) to make a nice point using one argument than covering a whole list of arguments.

Also, there are books written to provide arguments for a certain point that fail to cover “all” arguments simply because adding one argument at the margin does not make the totality of the argument more convincing. And even if one would like to cover all arguments, it wouldn’t be possible simply because there are only so many pages one can write in a book.

Now apply this on an article. If all arguments cannot be covered in a book, can they be covered in an article? It should be obvious that “it doesn’t cover all the arguments” is no real criticism; it is, at best, a poor attempt to talk down the article without wanting to take on its content.

I have commented on this issue of criticism before but it seems the people eager to comment on my articles do not read this blog. Or, at least, they don’t understand what I am saying, which is another point that is pretty clearly communicated through this kind of comments.

I do enjoy feedback. But please spare me the cheap remark; there are more productive uses of my time.