Tuesday, May 04, 2010

Quote of the Day/Century

"The champions of socialism call themselves progressives, but they recommend a system which is characterized by rigid observance of routine and by a resistance to every kind of improvement. They call themselves liberals, but they are intent upon abolishing liberty. They call themselves democrats, but they yearn for dictatorship. They call themselves revolutionaries, but they want to make the government omnipotent. They promise the blessings of the Garden of Eden, but they plan to transform the world into a gigantic post office. Every man but a subordinate clerk in a bureau. What an alluring utopia! What a noble cause to fight!

Against all this frenzy of agitation there is but one weapon available: reason. Just common sense is needed to prevent man from falling prey to illusory fantasies and empty catchwords."

From
"Bureaucracy" by Ludwig von Mises (1944)

54 Comments:

At 5/04/2010 10:45 AM, Blogger James Fraasch said...

Genius

 
At 5/04/2010 10:46 AM, Blogger W.E. Heasley said...

Progressives over the last 100 years solve every possible problem with more and more government intervention in the form of regulation, government programs leading to addition bureaucrats, and unfunded entitlements.

To understand this perpetual phenomena more fully, you have to understand progressives within the political class (democrats and/or republicans). The progressives within the political class are the anointed/intelligentsia that know what is best for the common man/woman. The progressive political class wants to paint the world in their own self image. They paint the world with "notions" that are not based on empirical evidence. These notions (the way things ought to be) are then argued through verbal virtuosity of moral obligation. Basically the political class argues that the producer class has a moral obligation to the recipient class. This moral obligation takes the form of transfer payments from the producer class to the recipient class.

Along the way, the progressive political class learned that they could build a constituency group, a voting block if you will, based upon the recipient class. The conduit of power is the "transfer payment" from the producer class to the recipient class. The power of the progressive political class is the transfer payment.

However, with any good scheme comes overreach or what some refer to as going a bridge too far. You see, the progressive political class made a major error in painting the world in their own self image through notions of the way things ought to be. The error is that the way things ought to be, in the long run, exceeds the summation of all possible transfer payments. Opps!

In other words, the accumulation of all the progressive political class actors over time and the accumulation of all their notions leading to all the schemes over time, go bust when the transfer payment from the producer class equals 100% to the recipient class.

 
At 5/04/2010 10:51 AM, Anonymous morganovich said...

perhaps a briefer summation is:

"liberals" are too conservative to embrace capitalism.

 
At 5/04/2010 11:20 AM, Blogger Steve said...

Power and wealth in the hands of the few is just as bad whether instigated by communists or corporatists.

Extreme libertarianism leads to the same result as extreme central planning - the distant few moving the levers of the economy & government to maximize the benefit to themselves at the expense of the long-term good of society.

A eye-opening diagram from Jesse's Cafe Americain shows the continuum between individualist and statist, how those relate non-exclusively to 'liberal' and 'conservative', and how excessive movement in either direction winds up at the same terrifying place.

A WELL-REGULATED free market is necessary to lift the human condition.

Aren't some rules necessary? Aren't some goals the proper purpose of government?

 
At 5/04/2010 11:21 AM, Blogger Steve said...

"The champions of libertarianism call themselves free-marketeers, but they recommend a system which is characterized by rigid obedience to conquering every market, and by a resistance to every kind of improvement of the market system that would deliver the benefits of such a free market to the most. They call themselves classical liberals, but they are intent upon abolishing liberty, instead promoting a subservience without check to the corporate interests. They call themselves republicans, but they ignore that this implies a 'res publica', a 'public affair'. They call themselves promoters of a better society, but they want to make the government impotent in every aspect of society. They promise the blessings of the Garden of Eden, but they plan to transform the world into a gigantic dark alley run by crooks and the powerful. Every man but a subordinate consumer in a shop, there but to deliver profits to the owners of capital. What an alluring utopia! What a noble cause to fight!

Against all this frenzy of agitation there is but one weapon available: reason. Just common sense is needed to prevent man from falling prey to illusory fantasies and empty catchwords." Spouted by people from every political/economic philosophy.

 
At 5/04/2010 11:23 AM, Anonymous Anonymous said...

That quote only makes sense when the world actually faced a threat from Communism and Socialism.

Today this quote seems rather quaint now that Communism has collapsed and China becomes more capitalist. The comments so far on this blog have been standard conservative drivel. Democracy reins and capitalism has no equal. When Costa Rica privatizes their pensions. When Sweden privatizes their pensions. When the formerly socialist Labor party leans right and accepts capitalism. Even in Brazil Lula a former socialist isn't trying to create a utopian paradise. Even in Greece the rubes will to face reality and cut the public sector even though they are a socialist government (it was the conservatives that lied about the budget) Conservatives now rule Canada and Mexico. Even with the silly rhetoric Obama is not a radical.

Conservatives and fake libertarians just like to feel that they are under attack from ignorant people. In that respect they are just like whiny west coast liberals. Face it even during the worst recession the world has faced since the 1930's no one is demanding we abandon capitalism. Liberalism won and you do not even know it.

 
At 5/04/2010 11:27 AM, Blogger Benjamin said...

Utopia?
I thought that was the Bush vision for Iraq and Afghanistan. "We are bringing democracay to the world," Bush said.
Utopian visions of conquest and liberation, and, incidentally, oil geysers.
Well, we are in for nine years in Iraqistan. Utopia takes longer than social do-gooders think, I guess.
In the USA, we have been subsidizing farmers for generations, and still they cannot stand on their own two feet. Socialism has created an entire weakling industry, enfeebled at the federal tit, mollycoddled in all forms.
End socialism at it core--in rural America.

 
At 5/04/2010 12:45 PM, Anonymous Anonymous said...

Judging by Steve's hyperventilating gibberish, I'd say von Mises remarks hit home. There is nothing more fun to watch than a leftist confronted with the simple truth. It's like watching a vampire writhing after being splashed with holy water.

 
At 5/04/2010 1:05 PM, Anonymous Anonymous said...

Conservatives and fake libertarians just like to feel that they are under attack from ignorant people.

Perhaps, that's because they are. Communism and Socialism did not simply collapse of their own weight, they had to be confronted and engaged. For decades, western leftists made common cause with liberty's enemies. It was conservatives, like Reagan, and "fake libertarians", like von Mises and Hayek, who took up the defense of free-markets and individual liberty. If socialism in Costa Rica, Sweden and Brazil is in retreat, you can thank men like them.

Liberalism won and you do not even know it.

You must mean that "classical liberalism" has gained a temporary upper hand against the collectivist "liberals" of the left. Unfortunately, there is no winning in this struggle. Leftists simply reorganize and repackage. Instead of openly declaring their intent, they use slogans, like Hope and Change. They openly praise free-markets as they nationalize huge swaths of the economy.

What von Mises so eloquently and devastatingly said about the socialists then is still true today. We must always heed his advice and be prepared to man the ramparts.

 
At 5/04/2010 1:10 PM, Anonymous Anonymous said...

Thanks, "Benny", for reposting that insipid little screed. Where would we all be without your deep insights into "rural America"? It makes so much more sense the hundredth time you read it.

 
At 5/04/2010 1:17 PM, Blogger Paul said...

Benji,

"End socialism at it core--in rural America."

Better: don't vote for socialists like Obama, as Benji did.

 
At 5/04/2010 1:18 PM, Anonymous Anonymous said...

Hmmm, Ludwig von Mises vs. "Steve". Close call. What does Janeane Garofalo think of von Mises argument? I mean if we're calling in the big guns ....

 
At 5/04/2010 1:21 PM, Anonymous Benny The Man said...

Anon-

The continual mollycoddling and subsidy of American farmers outrages all true free marketeers.

It is socialism defined!

It has created a dependent class of enfeebled fat-snufflers, surviving only on the dole provided by other, productive taxpaying businesses and workers.

Why does my business pay taxes, and why do farmers get subsidies--and this has been going on for generations!

Proof that socialism is a failure: The American Farmer.

 
At 5/04/2010 1:22 PM, Blogger Redbud said...

Champions of socialism MUST call themselves other than they are in order to gain their power. Duh!!!

In reality, even communism works great in a small enough group with strong ties, like a family. But in large groups, not so well. Not too many of us want to sacrifice dearly for strangers, especially ones who are deadbeats.

 
At 5/04/2010 1:35 PM, Anonymous Anonymous said...

Proof that socialism is a failure: The American Farmer.

It has been pointed out to you, time and again, that the average American farmer receives little or nothing in subsidies. Most farm subsidies are paid to large corporations or celebrity "farmers", like newscaster Sam Donaldson or the communist and bigot Ted Turner. Apparently, you are just to enfeebled and stupid to process these facts.

 
At 5/04/2010 2:18 PM, Anonymous Anonymous said...

It is encouraging to read that fewer people appear to fall for that old "all or nothing" argument. There is a whole world of difference between socialism, where the means of production is owned/operated by the state and a regulated free market system.

I find it ironic that Americans accept as perfectly natural that football would have rules of play and salary caps...but start ranting as soon as someone suggests that those same concepts should apply to business. Do rules "ruin" the game of football??? Is football socialism now??? LOL

 
At 5/04/2010 2:25 PM, Blogger Paul said...

"The continual mollycoddling and subsidy of American farmers outrages all true free marketeers."

And now note the difference in tone Benji The True Free Marketeer exhibits when it comes to his boyfriend Obama: "Oh well, get over it, we have Obamacare. I can thik of worse things."

 
At 5/04/2010 2:33 PM, Blogger Benjamin said...

Paul:
I can think of worse things: The mollycoddled American farmer.

 
At 5/04/2010 2:41 PM, Blogger Paul said...

Benji The Very Selective True Free Marketeer,

So take it up with your boyfriend who was cheating on you with Big Ag throughout his entire legislative career.

 
At 5/04/2010 2:52 PM, Blogger Ron H. said...

This comment has been removed by the author.

 
At 5/04/2010 3:03 PM, Blogger Ron H. said...

Steve

You seem to be having a problem with definitions. Your understanding of libertarianism is way off.

>"Power and wealth in the hands of the few is just as bad whether instigated by communists or corporatists."

This is absolutely true. BOTH involve the use of force by central government. They are at one end of a scale of a measure of liberty, not opposite ends.

As to the little circular diagram you link to. Do you understand that libertarianism is right at the front where we read "Rights of the Individual, Respect for Property, Decentralized Power, and Market Based Economy"?

>"A WELL-REGULATED free market is necessary to lift the human condition."

This is an oxymoron. You can't say "well regulated" and "free" in the same sentence about markets.

>"Aren't some rules necessary? Aren't some goals the proper purpose of government?"

The correct role of government is clearly defined here.

>" "The champions of libertarianism call themselves free-marketeers,..."

You begin this comment with a ". are you quoting, or these your own words?

In either case this is pure drivel. You need to get a clue here.

5/04/2010 2:52 PM

 
At 5/04/2010 3:07 PM, Anonymous Anonymous said...

I find it ironic that Americans accept as perfectly natural that football would have rules of play and salary caps...but start ranting as soon as someone suggests that those same concepts should apply to business.

No one favors "rules" more than the corporatist, as they invariably act to restrict competition by imposing costs on his competitors, resulting in the entrenchment of the corporatist's position.

 
At 5/04/2010 3:08 PM, Blogger Ron H. said...

Dr. Perry may have hit on a real hot button. It seems that most comments eventually evolve to this very discussion.

 
At 5/04/2010 3:12 PM, Anonymous morganovich said...

farm supports have been 1% of the federal budget.

healthcare is already 19% and obamacare will drive it up another 20% at the least just covering the new patients, meaning a 4 point swing in share of federal budget, or 4X the size of the entire farm subsidy.

i'm not in favor of the farm subsidy, but it's far less damaging, expensive, and distortionary than obamacare.

ideally, both ought to go away and take ethanol requirements with them.

 
At 5/04/2010 3:15 PM, Blogger Ron H. said...

>"That quote only makes sense when the world actually faced a threat from Communism and Socialism."

Do you mean like now?

 
At 5/04/2010 3:41 PM, Anonymous morganovich said...

anon 3.07-

that's an extremely misleading analogy.

football imposed it's own salary cap for a reason - the NFL wanted to make the game more entertaining by making the teams more even and thereby drive viewership and profit. it makes the pie bigger. they made a choice to drive growth.

the NFL is the business. the teams are franchises. this was a business making a choice for itself. it's like setting a budget for divisions. there was no government compulsion. the teams do not exist without the NFL any more than a mcdonalds franchise can exist without license from mc-corporate.

doing the same to all business effects all of our livelihoods. we do not work because we want parity and excitement, we do it to feed our families and get the things we want. we and our businesses are not franchisees of the government (though you wouldn't know it to listen to DC these days)

even if we leave rights aside, such government fixing of salaries and redistributionist taxation SHRINKS the pie. you take from the productive and give to the unproductive. that's what progressive taxes do. that's what salary limits do. it hurts us all. there's a reason why socialist countries grow less well and communist ones shrink.

your example of NFL salary caps is really an argument for letting businesses set compensation as they see fit. that's what happened there, you are just mistaking a franchise for the business. if GS wants to cap salaries, then can, but they'll lose all their best people so they pay them what they're worth instead. pretending that the government is a better judge of employee value that their employer is indefensibly stupid.

if someone told the NFL that it could only make so much money, then it would stop trying so hard to make the game more exciting. why work hard and create growth for no compensation? revenue and the game would stagnate.

governmental price fixing never works.

 
At 5/04/2010 4:02 PM, Anonymous grant said...

Brazil sends industrial spies to all parts of the planet to steal other countries technology in every field. Lulu is a sleeping socialist on the prowl to devour loose talking fools.
Lulu is currently trying to purchase jet fighters from the US France and Sweden.
Lulu is playing one country off against the other so that the sale of these jet fighters hinges on who is prepared to transfer the technology to Brazil to build them there.
Forget the x-socialists they are still authoritarian stand over men.Wolves in sheeps clothing.

 
At 5/04/2010 4:40 PM, Anonymous grant said...

~~~COMPETITION DRIVES INNOVATION~~~
Not any type of private markets or government intervention so stop whingeing and get out and innovate because this is what made America great.

 
At 5/04/2010 4:46 PM, Anonymous Anonymous said...

Hayak stated,,,, over 60 years ago
"Democracy is the equality of LIBERTY,,,, Socialism is the equality of RESTRAINT,,,and SERVITUDE

J Kelley

 
At 5/04/2010 5:42 PM, Blogger sonofeire said...

" . . . no one is demanding that we abandon Capitalism . . . "

If you believe that, you obviously have not been paying attention to the political currents.

 
At 5/04/2010 5:46 PM, Blogger sonofeire said...

And NO, I am NOT one of those making a demand for abandoning Capitalism . . . but there are plenty of fools out there who are.

 
At 5/04/2010 6:08 PM, Blogger toe said...

Do you seriously believe that we've arrived at the dire point we're at today because of too LITTLE government intervention?

If this is what passes for insight in your estimation, Dr. Perry, then I'd have to conclude that maybe tenure isn't that hard to come by after all.

 
At 5/04/2010 7:03 PM, Anonymous Anonymous said...

The thing no one here seems to recognise is that "government" has become merely a front for corporatist interests.

Big business "owns" the supposed representatives of the people - think of banks, big Pharma, health insurance, agri-business, the military-industrial complex etc. The legislators are clueless (do you believe any of them actually read and understand the stuff they rubberstamp?) and follow the directions given by the specialist lobbyists who fund their campaigns.

The US today is neither socialist not capitalist in the libertarian sense - it is corporatist, a perverted and dangerous aberration of capitalism and so-called free markets.

If you have any doubt about this read "Gangs of America: The Rise of Corporate Power and the Disabling of Democracy" by Ted Nace. It is downright scary.

 
At 5/04/2010 7:16 PM, Blogger PeakTrader said...

Questions for big government:

Kaliopi Margomenou: "This country has faced many difficulties, but now for the first time ever I don't feel proud to be Greek," she said. "I am humiliated because we always thought the IMF was for incapable, corrupt countries. That's what we are, incapable and corrupt, at least those who governed us in recent years."

Retired lawyer Maria Papaspyrou, 69, said she has always paid her taxes and is angry that her pension is being cut. "Where did the money go? Who took it? Why should honest people pay this terrible price?" she asked.

Marios, a 35-year-old bank employee who asked that his last name not be used. "How is any of this my fault? I am seriously thinking of going overseas."

 
At 5/04/2010 7:52 PM, Anonymous Anonymous said...

Ludwig von Mises stands above or equal to all great economists. It is a shame that he is not afforded the respect that his work deserves. We are all the poorer for not following his teachings! The Austrian School is well worth studying as well as a visit to www.mises.org

 
At 5/04/2010 9:15 PM, Anonymous grant said...

PT? Doesn't this get back to what you were saying in a previous post "That America needs to bring in 1 million young skilled workers a year because the ageing represent too large a percentage of the total US population" Currently are there enough young taxpayers to support the retired into a medically possible longer life span. Maybe Greece in supplying those migrants and therefore is also an ageing population when the young ones leave.

 
At 5/04/2010 9:25 PM, Blogger Ron H. said...

>"Do you seriously believe that we've arrived at the dire point we're at today because of too LITTLE government intervention?"

Did you get that impression from the post? If so I can only conclude that earning a high school diploma no longer requires the level of reading proficiency it used to. I would suggest that you reread the post carefully, or better yet read the entire conclusion of this highly acclaimed book by von Mises at the link provided at the end of the post.

I understand that von Mises is sometimes not the easiest material to read, as his intended audience was mostly well educated people like himself, and he often uses big words.

If you learn more about von Mises, you will realize that he, of ALL people, wasn't advocating for MORE government interference.

 
At 5/04/2010 9:45 PM, Blogger Ron H. said...

ANON @ 7:52

I couldn't agree more. I think that the Austrian economists aren't more popular with policy makers and politicians, because they basically call for less government.

Keynes, on the other hand, calls for massive government intervention in the market. A much more popular idea.

 
At 5/04/2010 11:52 PM, Anonymous Anonymous said...

Big business "owns" the supposed representatives of the people ...

No, big labor owns the representatives of the people. Spend a little time at opensecrets.org.

 
At 5/04/2010 11:58 PM, Anonymous Anonymous said...

America needs to bring in 1 million young skilled workers a year because the ageing represent too large a percentage of the total US population ...

Anything to perpetuate the entitlement Ponzi schemes put in place by the Democrats.

 
At 5/05/2010 2:39 AM, Blogger PeakTrader said...

Grant, I believe, Greece has an older population. It may be a prelude of what'll happen in the U.S. when the last of the Baby-Boomers (born between 1946-64) reach 65 in 2029.

Anon states: ""government" has become merely a front for corporatist interests."

Government has become the senior partner and may or may not cooperate with firms, households, or individuals.

In Denver Colorado, government and business work together to complete major projects (e.g. three pro sports stadiums, an international airport, a convention center, a light rail system, renovation of lower downtown, a central library, etc.).

In San Francisco or Oakland California, government and business don't work together, and no major projects have been completed in many years (some projects remain incomplete, because of cost overruns).

 
At 5/05/2010 8:21 AM, Anonymous Anonymous said...

We all agree that liberalism or communism is self destructing. The problem is that once it holds power it takes at least 50 years to destroy itself. Let us pray that the US has the character and wisdom to enable a quicker turnaround.

 
At 5/05/2010 2:41 PM, Anonymous grant said...

PT? Wasn't the imbalance in the population really caused by the introduction of the birth control pill in 1960 when women could choose whether they conceived,postponed,or became barren fem4males.I think what is needed on this is concise population data. Maybe MP's can post this also.

 
At 5/05/2010 4:03 PM, Blogger juandos said...

Anonymous @ 5/04/2010 11:23 AM says: "Today this quote seems rather quaint now that Communism has collapsed and China becomes more capitalist. The comments so far on this blog have been standard conservative drivel"...

Let me guess, maybe you think the present President is a 'free marketeer', right?

"Conservatives and fake libertarians just like to feel that they are under attack from ignorant people"...

Is that you pseudo benney?

 
At 5/05/2010 9:38 PM, Blogger Ron H. said...

>"In Denver Colorado, government and business work together to complete major projects (e.g. three pro sports stadiums, an international airport, a convention center, a light rail system, renovation of lower downtown, a central library, etc."

PeakTrader-

Business and government working together is almost always a bad idea. Invariably either consumers or taxpayers or both take it in the shorts.

Ask yourself why, if the above examples were good ideas, they weren't built privately without any government involvement.

In the projects you list above, ask who benefited from them and who paid for them, or is still paying for them. They aren't always the same people.

For some great discussions on government planning and rail systems in particular, check out The Antiplanner blog.

One of the worst examples of this unholy alliance is This one. as you probably know, Pfizer never built anything on the property, and it is now vacant land. All of that for nothing.

How many people in Denver do you suppose were forcibly displaced by the renovation of lower downtown, and who benefited?

 
At 5/05/2010 11:24 PM, Anonymous grant said...

"business and government working together is almost a bad idea"

YES because oil rigs approved by government and built by private contractors are collapsing into the gulf of mexico.

 
At 5/06/2010 12:10 AM, Blogger PeakTrader said...

Ron, you should ask yourself why Oakland California can't produce major projects that benefit its people. One reason is government hostility towards big business.

Exxon wanted to build a refinery in California. After being threatened with lawsuits and its reputation attacked, Exxon concluded it would be out of its mind to build the refinery (in part, because the return wasn't high enough to compensate for the risk).

City improvements in Denver increased real estate values substantially. It seems, everyone in Denver benefited, while Oakland, in comparison, remains a dump.

 
At 5/06/2010 12:20 AM, Blogger PeakTrader said...

Grant, the population imbalance may have begun with the Civil War.

 
At 5/06/2010 2:05 AM, Blogger toe said...

> Ron H.

Ron, THANK YOU for pointing out the mistake in my post: I meant to say "Do you really believe we've arrived at the dire point we're at because of too MUCH government regulation?"

If I'm going to launch an ad hominem attack, I should at least proofread the comment I dash off in the heat of the moment...or suffer the consequences.

That said, please address the substance of what I meant to ask:

Do you really think the problem here is too MUCH gov't. regulation?

If so, kindly put the crack pipe down and try to point out ONE SINGLE ECONOMY in which Mises' ideas have been successfully realized.

 
At 5/06/2010 3:06 AM, Anonymous grant said...

PT? You know I never thought of that but now you mention it I think you may be right or on the right track Thanks!

 
At 5/06/2010 4:53 AM, Blogger Ron H. said...

>"Do you really think the problem here is too MUCH gov't. regulation?

If so, kindly put the crack pipe down and try to point out ONE SINGLE ECONOMY in which Mises' ideas have been successfully realized."


Yes, toe, I absolutely think the problem here is too much government regulation and interference.

Don't you see Obamacare, Cap & trade, government takeovers of AIG, GM, and Chrysler, bailouts of other businesses as problems?

Where would you want to see MORE regulation? Please don't say banks. You must understand that they are already the most highly regulated businesses in the US.

The Austrian school of economics (von Mises) would define the role of government as providing basic institutions that protect the liberty of individuals to pursue their own economic interests, thus resulting in greater prosperity for the larger society.

Would Hong Kong come close to your requirement to show a successful, relatively free market economy based on that definition?

It's likely the closest we'll find in the World today. Government there plays a passive role, pretty much leaving direction of the economy to market forces and the private sector.

On the other hand, there are plenty of examples of excess government control causing misery.

North Korea, Cuba, and now Venezuela are a few, and of course you'll remember that the great experiment in total government, the former Soviet Union, failed. Tens of millions of people died when an ideology was forced on them, that ultimately didn't work out.

 
At 5/06/2010 5:04 AM, Blogger Ron H. said...

>"YES because oil rigs approved by government and built by private contractors are collapsing into the gulf of mexico."

Well, you can thank government (Coast Guard) for that. They pumped it so full of water, it could no longer stay afloat.

 
At 5/06/2010 6:11 AM, Anonymous Jean said...

you americans should really think twice before getting all worked up on an obvious quote.

how relevant is this quote today? What is exactly the point of highlighting the fact that Marx and whoever were right or not?

Don't you have anything more interesting to think about... Quote of the century? really?

 
At 5/06/2010 3:56 PM, Blogger juandos said...

"If so, kindly put the crack pipe down and try to point out ONE SINGLE ECONOMY in which Mises' ideas have been successfully realized...

Man! oh man! If had been paying property taxes that were where toe went to school I'd be demanding my money back...

 

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