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I’m a big fan of Murray Rothbard and have read pretty much everything that he wrote, which was a lot as he was a prodigious author. I came across this article which for the most part was very flattering, but contained these two criticisms.

Unfortunately, Rothbard also sidesteps some difficult problems. The primary argument for having a state at all is that the state can overcome the public goods/free rider problem, while private entrepreneurs cannot. Rather than addressing this argument, Rothbard effectively denies the problem exists, which is no answer at all and certainly does nothing to assuage the doubts of critics. Similarly, in response to the challenge that his proposed private protective agencies would fight among themselves and oppress people, he simply asserts this would be too costly for them and they’d realize peaceful cooperation and trade are more profitable.

Well, no. One could use this logic to “prove” that Al Capone would never order the St. Valentine’s Day massacre of the North Side gang, or that Hitler would never invade Poland. There’s nothing special about whether we call an organization a “state” or not that changes the benefit-cost analyses of the leaders in these matters. Perhaps it’s possible that under certain circumstances an anarchic society could be peaceful and stable, but Rothbard simply ignored the most difficult problems for his theory.

That, to me, illustrates Rothbard’s primary flaw. It seems to me that for him, no argument is too shallow so long as it leads him to a libertarian conclusion. His dedication to liberty is admirable, but as the 19th century French economist Frederic Bastiat warned, “The worst thing that can happen to a good cause is, not to be skillfully attacked, but to be ineptly defended.” In my view, by not taking arguments for a minimal state sufficiently seriously, Rothbard ends up deceiving himself and supposing that the case for his anarcho-capitalism is airtight. I think it is not, and there are other examples of this sort of error in Rothbard’s economic, political, and historical writing.[3]

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In the history of ideas, few theories have had the staying power of the Great Chain of Being—the idea that we live in a universe in which one’s position is fixed by one’s status. For some people, that’s very reassuring. As Mel Brooks observed, it’s good to be the king. If, on the other hand, you’re just a serf, you’re not to worry. That’s just where you’re supposed to be in a Great Chain of Being ordained by God himself. That was Pope’s point in the Essay on Man:

Order is Heaven’s first law; and this confest,
Some are, and must be, greater than the rest,
More rich, more wise.

When people looked to theologians rather than scientists to give meaning to a confused world, the Great Chain of Being offered the consolation of a unified explanation of everything. From God himself at the apex down to mere earth below, all that is or could be has its established and immovable place. Below God there are hierarchies of angels, pure spirits; and below them man, both eternal spirit and fallible body. Still lower are soulless animals with the power of motion, and lower still are immobile plants with the power of growth. At the very bottom is earth, mere matter, that has only the attribute of existence.

Amongst humans there are gradations, too—emperors, kings, nobles, knights, freemen, and serfs—and the Great Chain of Being served the double purpose of insulating those on top from peasants with pitchforks below while reassuring those below that their natural desire to move up was nothing more than a snare. As all this was God’s invention, rebellion was both foolish and impious.

We had thought the Great Chain of Being washed away by the rise of science, by 18th-century philosophes such as Voltaire, by Jefferson and the Founders. But we were wrong. As long as there are elites, there will be people who think they deserve their place atop the greasy pole, that resistance is futile, that the underclass must learn where they naturally belong. And that’s what many of our left- and right-wing elites have come to believe.


For the secular left, the Great Chain needs a bit of reworking. There’s no God, of course, and no angels, but there is a self-conscious progressive elite. In place of God, there’s the academy, itself divided by a class structure as rigid as Burke’s Peerage, and ranked by the decidedly underclass U.S. News and World Report.

Beneath the top schools, like the orders of Seraphim and Cherubim in the angelic hierarchy, are ranged the lesser ones. On meeting each other, the assistant professor at Behemoth State would make a low obeisance to the Ivy-chaired prof, while the Shimer College professor would hug himself with delight if the Yale professor deigned to acknowledge his existence. As a sociologist, James Q. Wilson knew all about the status games academics play. He once told me that he had been a member of three institutions: the Harvard faculty, the U.S. Marine Corps, and the Catholic Church. “I’ll leave it to you to figure out which was the most hierarchical,” he said.

Beneath them, like the serfs of old, are the graduate students, the undergraduates, and then—surprise—lower still is the animal and plant world, and Mother Earth. The non-progressives whom Obama described as clinging to their guns and religion, on the other hand—NASCAR nation, country-music fans, people accounted to be dumb as dirt—count for less than dirt in the eyes of the progressive elite.

If you don’t believe me, look at their policies, in which saving the planet takes precedence over saving ordinary lives. Malaria kills nearly half a million people a year, mainly in sub-Saharan Africa. This can be addressed by spraying with DDT, which never killed anyone. It does kill birds, however, and the progressive worries more about them than he does people.

They’ll tell you it’s because they love the earth. Don’t believe them. One can’t love something that can’t love back. That was the meaning of Cardinal Newman’s motto:cor ad cor loquitur, “heart speaks unto heart.” It’s why you can love your dog but not your goldfish.

One reads about people who’ve married trees, about “eco-sexual” students marrying the Ocean (the Pacific, naturally). It’s all nonsense. It’s as silly as people who tell you they worship an impersonal god. You might as well worship Euclid’s geometry. He might be the ground of your being, but if He’s not a personal God, the God of Abraham, Isaac, and Jacob, not of philosophers and scholars, he’s not a God with whom one can have a personal relationship.

So what’s behind the earth lovers, if it’s not love? Just the opposite. Enmity. Contempt. Derision. The goal is to establish oneself in the pecking order by asserting one’s superiority over conservatives, sincere believers, “white trash,” placing them at a lower level than the plant and animal kingdoms. It’s the ultimate form of passive aggression. It’s the indignation of the social-justice warrior at Yale who asserts her own privilege by asking you to check your privilege. And it’s the product of our factories of hatred, the modern U.S. university.


For right-wing elites too, there’s a Great Chain of Being. At the very top are a few right-wing academics, the fellows at the well-funded think tanks, the writers at top conservative magazines, and especially the NeverTrumpers. That something might be said for the Republican nominee’s policies—for restrictive immigration laws, for better trade deals, for campaign-finance reform—is mostly ignored. More revealing, however, is what those at the top of the chain say about Trump supporters.

For George Will, they were “invertebrates.” For Charles Murray and Kevin Williamson, the story is one of white working-class vice, of drug use, divorce, and unwed births. If the underclass wasn’t working, that was its fault. After looking at one town, National Review’s Williamson wrote, “the truth about these dysfunctional, downscale communities is that they deserve to die. Economically, they are negative assets. Morally, they are indefensible. … Donald Trump’s speeches make them feel good. So does OxyContin.”

Had the likes of Williamson paid more attention to Trump’s message, they might have realized that he spoke to real middle-class concerns. Our immigration laws are a scandal and effect a wealth transfer from poor to rich native-born Americans. Our tax system has done the same, and our schools betray our students. The perfect Republican idiots looked at the evidence of income immobility in America and blamed it on the move to an information economy, as though the highly mobile countries to which the American Dream has fled—Denmark and Canada—are living in the Stone Age. They were foolish to ignore the voters and more foolish still because they failed to recognize that all the barriers to economic and social mobility, to the American Dream, were created by the left. It was the right’s issue, and they gave it away.

Williamson reminds one of the unfeeling strain in contemporary conservatism. It’s something we’ve seen in Mitt Romney, Ted Cruz, Randians, and not a few libertarians. What Romney and Cruz communicated was a perfect fidelity to right-wing principles and an indifference to people.

In 2011 Romney presented us with a 59-point plan and settled back as though he had just proven that he deserved the office. No one read any of it, however. What we heard instead was his notorious line about the 47 percent who are “takers,” a phrase that came out of the American Enterprise Institute and which doomed his presidential campaign. Nearly half of all Americans were spongers, Romney had said, and these presumably were the sort of people whom he liked to fire. By contrast, Obama told us he had our back. That was a bit of an exaggeration, as it turned out, but Romney lost what should have been an easy Republican win.

Ted Cruz too approached the primaries as though politics were nothing more than ticking off a series of right-wing boxes. He had an extraordinarily efficient team of Washington advisors—but, graced with a face that seemed incapable of a human smile and given to embarrassing and showy displays of Evangelical piety, he was hard for most primary voters to take. His biography revealed an inner life that was not without its moments of warmth and self-deprecating humor, but none of that came across in the campaign.

What Romney and Cruz had promised was growth, more growth, a greater GDP, but none of this much appealed to middle-class voters who thought that all of the growth would go to people at the top of the heap, asset-fund managers like Romney or lawyers like Cruz. Defending free trade, for example, Cruz said correctly that this would be great for American consumers. What he left out was how it would affect American producers, the working men and women whose jobs are lost when factories move to lower-cost nations abroad. That’s not to say that free trade is a net negative, but only that policies can’t be judged without taking into account their distributional effects on all segments of the people.


In 1845, Benjamin Disraeli, then a society novelist (as well as a politician), shocked his readers when he announced that England was divided into two nations—the rich and the poor. We also are divided into two nations—the intellectuals and la populace, Big Brains versus Little Brains, with the wealth gains going to the former and the smallest of trickle-down kopecks to the latter. Romney and Cruz were obviously members of the Big Brain nation and that’s to their credit, but now we’ve seen a barrier descend between them and the lower classes, like the one described by Disraeli, two nations

between whom there is no intercourse and no sympathy; who are as ignorant of each other’s habits, thoughts, and feelings, as if they were dwellers in different zones, or inhabitants of different planets; who are formed by a different breeding, are fed by a different food, are ordered by different manners, and are not governed by the same laws.

Our intellectuals—a word invented by the repellant and brilliant anti-Dreyfusard Maurice Barrès—live in a bubble, amongst their own kind. They’ll dress differently, eat very different food, laugh at different jokes, attend entirely different schools, and have wholly different leisure activities. They’re far more likely to be liberal than conservative, but whatever their politics they’ll recognize that they have much more in common with each other than with their ostensible political allies amongst the Little Brain populace.

The sense of belonging to a particular class has given us a distinct literature, enjoyed only by the intellectuals. Amy Chua’s Battle Hymn of the Tiger Mothergave away all their tricks to move their children up the Chain, and for this reason was greedily devoured by them. David Brooks’s Bobos in Paradise did the same for their manners and diversions. Earlier still was Richard J. Herrnstein and Charles Murray’s The Bell Curve, which first described the rise of an intellectual class. But intellectuals read it with a guilty pleasure. “How horrible,” they thought, but hugged themselves in delight to find that they belonged to a special, aristocratic class.

There have always been differences between the quick and the slow, but I rather think they mattered less in the past, or at least that we were less divided. In the public school I attended in Canada as a young child, an imbecilic, hydrocephalic boy was one day brought to class. He could not talk, but from the way he smiled he seemed to be very happy to join us. I imagine his parents felt the experience would be good for him, and that our teachers—Sisters of Charity—thought that the experience would be good for us.

I’d like to report that the students befriended him, but we didn’t. We were six or seven years of age, and a little shy and formal. And worried, too, perhaps that we’d open ourselves to ridicule if we did so. No one mocked him, but then no one sought him out either. He lasted no more than a week amongst us, and I never knew his name or what happened to him, but since then not a year has passed when I’ve not recalled him.

The Sisters of Charity had a special reverence for the Curé d’Ars, St. Jean-Marie Vianney, a French priest of the early 19th century. The Church has had a good many highly intelligent saints, but the Curé d’Ars wasn’t one of them. He was slow indeed, and scarcely able to master the Latin he needed to become a priest. He was, however, a profoundly holy person, and it was that combination of sanctity and slowness that commended him to the nuns. They gave us relics of his cassocks and encouraged us to share their love for his simple gifts.

I mention these little stories to emphasize how deeply perverse they’ll seem to the modern reader (for all this happened many years ago). Worth today is measured on an IQ scale, not a holiness one. Indeed, the very idea of holiness will seem unintelligible to most people today, the idea that merit attaches to a life devoted to the service of God, quietly, humbly lived in a little village, without television screens to celebrate public displays of virtue. As for my hydrocephalic classmate, many will think it a shame he was not aborted. But then I would have missed the message about the sanctity of life, of all life. And he would have missed his life, which I expect had more moments of holiness than mine ever will. I remember his face, but count it a shame I never knew his name.

I have another reason to mention these stories, for I want to distinguish the radical equality that the Sisters of Charity embraced from the divide between the makers and takers of Mitt Romney and the American Enterprise Institute, between Big and Little Brains. The divide is seen in where you live, the school you went to, the clothes you wear, and the food you eat. It’s also a question of religious belief, for most intellectuals on the right draw their inspiration not from the Judeo-Christian tradition but from abstract theories of natural rights that have little need of God. They revere Jefferson, but as Walter Berns once asked me, just what kind of a god is “Nature and Nature’s God” anyway? At most, He’s Descartes’s god, as seen by Pascal, where he appears in Act I of the drama to give the system a “little push” and then departs the scene. But if that’s all He is, why do we need Him?


Romney was a bishop in the Mormon Church. Cruz was given to ostentatious displays of religious belief. Few politicians advertise their unbelief. But dig deeper and you’ll find that many right-wing intellectuals are atheists—the Randians, many libertarians, and some of the leading Straussians. We’ve known all this and had thought it didn’t matter. In part that’s because we’ve adopted the rule of etiquette which demands that religious matters are too private to be discussed (which is an excellent rule for dinner parties). We’ve also observed that our atheist friends adhere to a code of honor and morality at least as elevated as that of the loudmouthed believer. Conscious of our own sins, “O God, be merciful to me, a sinner” is the only prayer one should dare utter.

I still think this, but now I begin to think that things are more complicated. However moral and generous the atheist might be, I suspect he’d have a hard time comprehending how I felt about my hydrocephalic schoolmate. I thought my poorclassmate had presented me with a moral challenge (which I had failed), but I suspect that natural-rights theorists would think this mere sentimentality. And this I think is a failing on their part. By resting their political beliefs on abstract axioms of natural rights they have subscribed to theories of learned heartlessness; and it is a testament to their personal goodness that they’re better than their theories.

One doesn’t learn empathy or kindness from John Locke. Perhaps it’s not something one learns at all. The natural lawyer says it’s written on one’s heart; the evolutionary biologist says it’s coded in our genes, which perhaps comes down to the same thing. But it’s not to be derived from abstract theories. At best it’s a philosopher’s premise, not his conclusion, as it was for Adam Smith in The Theory of Moral Sentiments. We might get it from our families, or be reminded of it by novelists such as Dickens, Hugo, or E.M. Forster. Mostly, however, we get it from religious education and belief.

The libertarian’s free-market principles explain how we can build a society in which both others and I may flourish. What they don’t explain is why I should care about others. Our Judeo-Christian heritage tells me I should, but this has been overwritten by the secular doctrines of today. Even devout Christians will prefer to speak the language of natural law and natural rights, conceding to the secular left the principle that moral and political arguments can be framed only in terms that might appeal to people of other or no faiths. But in so doing they abandon the firmest and most encompassing foundations of our moral language.

The natural lawyer, who is often an atheist, would have you think that the opposite of natural law is anarchy and nihilism. It’s not. It’s revealed law, the law given to Moses and preached by Christ. The natural-rights theorist can tell you what others owe him, but not what he owes to others save for the thinnest of duties: don’t harm others, don’t steal from them or defraud them. Does that sound like a complete moral code? Does that tell me anything about my duties to my hydrocephalic classmate?

Morality within the limits of reason alone is the morality of an efficient insurance contract: I will help you because it is in my interest to do so, because I expect a return favor from you. It is the morality of pay-for-play, of Peter Schweizer’sClinton Cash. It is the debased morality that Alexis de Tocqueville saw at the root of the self-help religion of 1830s Protestant America. But morality is not a means but an end in itself, and the goodness I should have shown to my hydrocephalic classmate was its own reward, if any reward there was. The last chapter of Job, if canonical, might nevertheless be regretted.

Kant sought to prove the existence of God from the moral law. He had it backwards. We more readily can infer the moral law from the existence of God. What I learned from my religion is that we all have souls, that we’re all equal in the eyes of God, that the theologian’s Great Chain of Being was a wicked fiction and a betrayal of Christianity, that the lowest of lives is as precious as that of an Ivy League grad. With their egalitarian principles, that’s something the left claims to understand better than the right, and perhaps they do too. What the right had, in place of political egalitarianism, was religion. But what happens when the salt loses its savor, when religious lessons are no longer learned? What one is left with is what Tocqueville—himself a religious skeptic—called the hardest aristocracy that has appeared on earth.

Ah yes, my atheist friends are generally more moral than I am. That’s a distressingly low bar, however. And even if they are privately charitable, we are permitted to wonder what might follow when mere sentiments are unmoored from a faith tradition. My friends are the inheritors of a religious, Western culture in which they live as illegal aliens, enjoying its harvest without planting the seed. A.J. Balfour, the most intelligent of British prime ministers, predicted all of the 20th century’s atrocities when he saw where this might lead:

Their spiritual life is parasitic: it is sheltered by convictions which belong, not to them, but to the society of which they form a part; it is nourished by processes in which they take no share. And when those convictions decay, and those processes come to an end, the alien life which they have maintained can scarce be expected to outlast them.

My atheist friends who themselves adhere to the highest codes of duty and honor might nevertheless want to consider how often they’ve observed antique republican virtue on display on college campuses or on television. What they’ve seen instead, for the most part, is the detritus of a culture that has lost its religious anchoring and with it any semblance of a moral culture.

They have dispensed with God and for their sophistication ask to be accepted by the intellectuals of the left as fellow members of a privileged elite in our Great Chain of Being. But in abandoning the religious tradition of the West, in their contempt for the invertebrates, the OxyContin sniffers, the takers, they reveal the icicle lodged in the conservative heart.

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My own experience with Unions is that unfortunately, they are a waste of your money. In theory, they are a good idea as certainly the employer holds more power in the employer/employee relationship.

Several of my cases this year have been Union cases where the Union simply was not interested in becoming involved.

One case in particular, which involved the Collective Agreement, which therefore impacted the entire Union….not interested. All they are interested in is taking the Union dues every two weeks on pay day.

There is the example of a disciplinary case, where, the Union recommended dismissal. It turns out there was a viable defence and the employee is now back at work.

As a condition of my employment as a professor at George Washington University, I must pay the SEIU every month. This Labor Day the good news is that I have been appointed as an adjunct professor of economics at George Washington University. I’ll be teaching a seminar in labor economics and public policy. The bad news is that as a condition of my employment, I must become a card-carrying, dues-paying member of the Service Employees International Union Local 500 — or pay the SEIU an agency fee in order to get out of membership.

The letter from Provost Forrest Maltzman tells me that “failure to pay dues or agency fees may result in termination.” My hiring letter includes a form that I am required to sign. On the form, I must give the SEIU my home address, home phone, alternate phone, and e-mail address. In addition to paying dues, I have to give the union personal information such as where I live and how to contact me. Further, I need to “authorize and request my Employer, the George Washington University, and any successor Employer, to deduct from wages hereafter due me, and payable on each available pay period due me, such sums for Union dues, fees, and/or assessments to the Union at times and in a manner agreed upon between the Union and the Employer.”

Not only do I have to give George Washington University permission to deduct dues from my wages, but I also have to give successive employers — whoever they might be — the power to deduct these dues. The SEIU, with almost 2 million members, is one of the largest political players in terms of political donations, according to the Center for Responsive Politics. So far, SEIU’s PACs and committees have spent $10 million on the 2016 election cycle opposing Republicans and supporting Democrats.

The SEIU has spent $5 million against Donald Trump and $4 million for Hillary Clinton. It spent $307,000 each against Marco Rubio and Ted Cruz. Democrat Katie McGinty, who is challenging Republican senator Pat Toomey in Pennsylvania, received $400,000, and Ted Strickland, who is running against Ohio senator Rob Portman in Ohio, netted $900,000. The Local 500 branch had 8,703 members and almost $4 million in assets in 2013 — the latest data available from With me, it will have at least one more. Of course, the SEIU will say that I am not forced to join the union and pay the $36 monthly dues. Instead, I can pay a monthly agency fee of $29.38. But I have to do one or the other. The SEIU might also say that in return for the dues or agency fees, they bargain on my behalf with George Washington University.

I have no need for anyone to represent me. I can represent myself. If GW does not offer me enough to make it worthwhile for me to teach, I can look elsewhere or find other employment. Unfortunately, while the National Labor Relations Board (NLRB) is shrinking the time to vote to join a union, getting out of a union is not an easy matter. In order to decertify the SEIU Local 500, 30 percent of the part-time faculty of George Washington University (the represented group) would have to sign a petition for a decertification election.

This can only be presented to the National Labor Relations Board 60 days before the end of the contract or after the contract has expired. Should a new contract be ratified before a decertification petition is filed, then the clock is reset and no petition can be filed until the end of the new contract. As the GWU union contract expires on June 30, 2018, it means that a decertification petition cannot be considered before May 1, 2018. If the NLRB truly had workers’ interests at heart, the agency would make it as easy for workers to leave unions as it is to join them. Once in place, unions are not required to hold elections for decertification.

A union could have been chosen to represent workers in 1980 and still exist today — even though all the workers who voted for that union have died or quit. That is one reason, according to a new report by Heritage Foundation scholar James Sherk, that 94 percent of workers in union shops never voted to join the union. Sherk concluded that only 478,000 of America’s 8 million unionized private-sector workers have chosen to join their union. If the NLRB truly had workers’ interests at heart, the agency would make it as easy for workers to leave unions as it is to join them.

Just as is the case with public-sector employees in Wisconsin, workers should be allowed to vote once a year to determine whether they want to be represented by a union — instead of being automatically signed up based on the votes of those who are no longer around. GWU students have an opportunity to learn from professors in classrooms. The SEIU adds nothing to the education of these students, but it subtracts from the compensation of teachers. It’s a bad deal for the students and faculty to enrich the SEIU. If new faculty members want to represent themselves, they should be exempt from all payments to the union.

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For a good many years, Tony Lawson has been urging economists to pay attention to their ontological presuppositions. Economists have not paid much attention, perhaps because few of us know what “ontology” means. This branch of philosophy stresses the need to “grasp the nature of the reality” that is the object of study – and to adapt one’s methods of inquiry to it.
5112X+PoJkLEconomics, it might be argued, has gotten this backwards. We have imposed our pre-conceived methods on economic reality in such manner as to distort our understanding of it. We start from optimal choice and fashion an image of reality to fit it. We transmit this distorted picture of what the world is like to our students by insisting that they learn to perceive the subject matter trough the lenses of our method.

The central message of Lawson’s critique of modern economics is that an economy is an “open system” but economists insist on dealing with it as if it were “closed.” Controlled experiments in the natural sciences create closure and in so doing make possible the unambiguous association of “cause” and “effects”. Macroeconomists, in particular, never have the privilege of dealing with systems that are closed in this controlled experiment sense.

Our mathematical representations of both individual and system behaviour require the assumption of closure for the models to have determinate solutions. Lawson, consequently, is critical of mathematical economics and, more generally, of the role of deductivism in our field. Even those of us untutored in ontology may reflect that it is not necessarily a reasonable ambition to try to deduce the properties of very large complex systems from a small set of axioms. Our axioms are, after all, a good deal shakier than Euclid’s.

The impetus to “closure” in modern macroeconomics stems from the commitment to optimising behaviour as the “microfoundations” of the enterprise. Models of “optimal choice” render agents as automatons lacking “free will” and thus deprived of choice in any genuine sense. Macrosystems composed of such automatons exclude the possibility of solutions that could be “disequilibria” in any meaningful sense. Whatever happens, they are always in equilibrium.

Axel Leijonhufvud

The whole basis of Austrian economics is deductivism. The axiom that is relied upon is ‘human action’. That ‘human action’ unarguably is an axiom should be beyond debate.

The Austrian method also uses the ‘open system’ in that acting man is employed to illustrate the economic phenomena being investigated.

Ultimately all economic systems are comprised of individuals. Therefore it is the individual that must be accounted for in any theoretical investigation of economic systems.


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1. “I think if you look at people, whether in business or government, who haven’t had any moral compass, who’ve just changed to say whatever they thought the popular thing was, in the end they’re losers.” Charlie Munger: The culture now is that anything that can be sold for a profit will be. ‘Can you sell it?’ is the moral test, and that’s not an adequate test.” Munger is unrestrained on this point: “I think we have lost our way when people like the [board of] governors and the CEO of the NYSE fail to realize they have a duty to the rest of us to act as exemplars. You do not want your first-grade school teacher to be fornicating on the floor or drinking alcohol in the closet and, similarly, you do not want your stock exchange to be setting the wrong moral example.”

2. “In 1981, at the age of 39, I was fired from the only full-time job I’d ever had—a job I loved. But I never let myself look back, and the very next day I took a big risk and began my own company based on an unproven idea that nearly everyone thought would fail; making financial information available to people, right on their desktops.” Many people are thrust into a situation with significant optionality by losing a job. When you are already in a position where you have little to lose taking a risk with a potentially big upside can be easier to do. Munger has said that he “developed courage when I learned I could deal with hardship. You need to get your feet wet and get some failure under your belt.”

3. “Persistence really does pay off.” Charlie Munger agrees: “Be persistent: Slug it out one day at a time.” On the subject of persistence, venture capitalist Mark Suster has said: “Tenacity is probably the most important attribute in an entrepreneur. It’s the person who never gives up—who never accepts ‘no’ for an answer….what I look for in an entrepreneur when I want to invest? I look for a lot of things, actually: Persistence (above all else), resiliency, leadership, humility, attention-to-detail, street smarts, transparency and both obsession with their companies and a burning desire to win.”

4. “The most powerful word in the English language is ‘Why.’ There is nothing so powerful as an open, inquiring mind. Whatever field you choose for starting a business—be a lifelong student. The world is full of people who have stopped learning and who think they’ve got it all figured out. Their favorite word is ‘No.’ They will give you a million reasons why something can’t be done or shouldn’t be done. Don’t listen to them, don’t be deterred by them, and don’t become one of them. Not if you want to fulfill your potential—and not if you want to change the world for the better.” People who get ahead most in life are invariably lifelong learners. They read, study and are inquisitive. Charlie Munger puts it this way: “In my whole life, I have known no wise people (over a broad subject matter area) who didn’t read all the time — none, zero.”

5. “I’m a very lucky guy.” “You can’t control how lucky you are, you can’t control how smart you are, but you can control how hard you work, so that’s the first thing.” Charlie Munger has similarly said: “Well, some of our success we predicted and some of it was fortuitous. Like most human beings, we took a bow.” Michael Mauboussin points out: “Skill is ‘the ability to use one’s knowledge effectively and readily in execution or performance.’ You can think of skill as a process, or a series of actions to achieve a specific goal. Luck is the events or circumstances that operate for or against an individual.” “Luck, in this sense, is above and beyond skill. Consider luck as a distribution that has an average of zero. By this definition, luck tends to be transitory. Note that many common phrases, like ‘you make your own luck,’ ‘luck is what happens when preparation meets opportunity,’ and ‘the harder I work, the luckier I get,’ do not fit with our definition. In each of these cases, luck is conflated with skill. Think of luck as something in addition to skill.”

6. “Being a plumber is a great job because you have pricing power.” [The plumber father of one of my employees has] got six plumbers working for him, he’s a scratch golfer, he goes around playing golf courses I only dream about. He’s built a business, he’s had a chance to do that. He never went to college.” A business that can raise prices and demand for the product does not drop significantly has pricing power. Some firms have so much pricing power that they can raise prices and demand goes up. If a business must hold a prayer meeting to raise prices it does not have a moat. A business may have factors that may create a moat in the future, but the best test for a moat is in the end mathematical. Munger believes:

“There are actually businesses, that you will find a few times in a lifetime, where any manager could raise the return enormously just by raising prices—and yet they haven’t done it. So they have huge untapped pricing power that they’re not using. That is the ultimate no-brainer. … Disney found that it could raise those prices a lot and the attendance stayed right up. So a lot of the great record of Eisner and Wells … came from just raising prices at Disneyland and Disneyworld and through video cassette sales of classic animated movies… At Berkshire Hathaway, Warren and I raised the prices of See’s Candy a little faster than others might have. And, of course, we invested in Coca-Cola—which had some untapped pricing power. And it also had brilliant management. So a Goizueta and Keough could do much more than raise prices. It was perfect.”

7. “I always give the most difficult and complicated assignment I have to the most overworked person in the company. There’s a reason they don’t have time — work is a marketplace, and it’s telling you this person is good.” What a market does is drench people who want something or make or sell something with feedback says Charlie Munger. Without feedback it is not only hard to respond and adapt to changing conditions, but to figure out who has talent and who is willing to work hard.

8. “None of you are going to be Mark Zuckerbergs. It’s just not going to happen.” As Charlie Munger says about investing: “It’s not supposed to be easy.” If it was easy anyone could do it.” The magnitude of financial success of someone like Zuckerberg or Gates happens extremely rarely. This must be so simply due to the top down math involved. There is only so much profit and revenue to be captured in any given economy given the normal workings of competitive capitalism. Financial success follows a power law distribution.


9. “If you say, ‘Look, my father never existed, my mum had cancer, I’m working five shifts at McDonald’s,’ that’s the person I’m going to hire.” Charlie Munger: “Life will have terrible blows in it, horrible blows, unfair blows. And some people recover and others don’t. And there I think the attitude of Epictetus is the best. He said that every missed chance in life was an opportunity to behave well, every missed chance in life was an opportunity to learn something, and that your duty was not to be submerged in self-pity, but to utilize the terrible blow in constructive fashion. That is a very good idea. You may remember the epitaph which Epictetus left for himself: “Here lies Epictetus, a slave maimed in body, the ultimate in poverty, and the favored of the gods.”

10. “Capitalism works.” Munger has similarly said, after giving the hat tip to Allen Metzger: “I regard it as very unfair, but capitalism without failure is like religion without hell.” Innovation and progress requires failure. Lots of failure. As Warren Buffett said in his 2015 shareholder letter: “Nothing rivals the market system in producing what people want – nor, even more so, in delivering what people don’t yet know they want.” Capitalism isn’t a perfect system, but it is the best one available by far. Markets sometimes fail, but that can be dealt with wise regulation.

11. “I don’t believe that government is good at picking technology, particularly technology that is changing. By the time you get it done and go through democracy, it’s so outdated.” What a politically driven process lacks is the ability to get real feedback in a timely way about the nature of a given decision. Many political systems are created with a set of “checks and balance” which work against efficiency. Munger: “The constant curse of scale is that it leads to big, dumb bureaucracy—which, of course, reaches its highest and worst form in government where the incentives are really awful. That doesn’t mean we don’t need governments—because we do. But it’s a terrible problem to get big bureaucracies to behave.”

12. “Life is too short to spend your time avoiding failure.” Munger puts it this way: “The wise ones bet heavily when the world offers them that opportunity. They bet big when they have the odds. And the rest of the time they don’t. It is just that simple.”

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Ray Kurzweil, the author, inventor, computer scientist, futurist and Google employee, was the featured keynote speaker Thursday afternoon at Postback, the annual conference presented by Seattle mobile marketing company Tune. His topic was the future of mobile technology. In Kurzweil’s world, however, that doesn’t just mean the future of smartphones — it means the future of humanity.

Continue reading for a few highlights from his talk.

On the effect of the modern information era: People think the world’s getting worse, and we see that on the left and the right, and we see that in other countries. People think the world is getting worse. … That’s the perception. What’s actually happening is our information about what’s wrong in the world is getting better. A century ago, there would be a battle that wiped out the next village, you’d never even hear about it. Now there’s an incident halfway around the globe and we not only hear about it, we experience it.

Which is why the perception that someone like Trump sells, could be false and misleading. But more importantly, what actions we take based upon that information. If I respond differently, then my perception has directly changed my actions, which has unforseen ramifications when multiplied by millions.

Brexit could be an example of exactly this.

On the potential of human genomics: It’s not just collecting what is basically the object code of life that is expanding exponentially. Our ability to understand it, to reverse-engineer it, to simulate it, and most importantly to reprogram this outdated software is also expanding exponentially. Genes are software programs. It’s not a metaphor. They are sequences of data. But they evolved many years ago, many tens of thousands of years ago, when conditions were different.

Clearly our genome is not exactly the same. It to has evolved. This may have been through random mutations, in which certain recipients thrived in a changing environment.

How technology will change humanity’s geographic needs: We’re only crowded because we’ve crowded ourselves into cities. Try taking a train trip across the United States, or Europe or Asia or anywhere in the world. Ninety-nine percent of the land is not used. Now, we don’t want to use it because you don’t want to be out in the boondocks if you don’t have people to work and play with. That’s already changing now that we have some level of virtual communication. We can have workgroups that are spread out. … But ultimately, we’ll have full-immersion virtual reality from within the nervous system, augmented reality.

One of my favorite novels is Asimov’s “Foundation” series. The planet Trantor….entirely covered by a city. Is that what we want?

On connecting the brain directly to the cloud: We don’t yet have brain extenders directly from our brain. We do have brain extenders indirectly. I mean this (holds up his smartphone) is a brain extender. … Ultimately we’ll put them directly in our brains. But not just to do search and language translation and other types of things we do now with mobile apps, but to actually extend the very scope of our brain.

The mobile phone as a brain extender. Possibly true for 1% of all users. Most use facebook or whatever other time wasting application, and essentially gossip. A monumental waste of time. Far from being a brain extender, for most, it is the ultimate dumbing down machine. Text language encourages bad spelling, poor grammar etc. So you can keep your brain extenders.

As far as directly connecting your brain to the cloud….that sounds like ‘The Matrix”, which is of course the subject of philosophical musings about the brain in a vat. The potential for mind control would seem to be a possibility here. Not for me thanks.

Why machines won’t displace humans: We’re going to merge with them, we’re going to make ourselves smarter. We’re already doing that. These mobile devices make us smarter. We’re routinely doing things we couldn’t possibly do without these brain extenders.

To date, I would argue that the vast majority are significantly more stupid because of them.

As to robots and AI, imagine a man, Spock, who’s choice making is driven 100% by logic, rather than by 50% logic and 50% emotion. How long does the emotional decision maker last? Most emotional decisions get us in trouble. The market is an excellent example. Politics is another, ie. Trump.


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We have immensely developed our means of locomotion, but some of us use them to facilitate crime and to kill our fellow men or ourselves. We double, triple, centuple our speed, but we shatter our nerves in the process, and are the same trousered apes at two thousand miles an hour as when we had legs. We applaud the cures and incisions of modern medicine if they bring no side effects worse than the malady; we appreciate the assiduity of our physicians in their mad race with the resilience of microbes and the inventiveness of disease; we are grateful for the added years that medical science gives us if they are not a burdensome prolongation of illness, disability, and gloom. We have multiplied a hundred times our ability to learn and report the events of the day and the planet, but at times we envy our ancestors, whose peace was only gently disturbed by the news of their village. We have laudably bettered the conditions of life for skilled workingmen and the middle class, but we have allowed our cities to fester with dark ghettos and slimy slums.

History affords us the opportunity to draw any conclusion we wish.

History is so indifferently rich that a case for almost any conclusion from it can be made by a selection of instances. Choosing our evidence with a brighter bias, we might evolve some more comforting reflections.

So we must first define progress.

If it means increase in happiness its case is lost almost at first sight. Our capacity for fretting is endless, and no matter how many difficulties we surmount, how many ideals we realize, we shall always find an excuse for being magnificently miserable; there is a stealthy pleasure in rejecting mankind or the universe as unworthy of our approval. It seems silly to define progress in terms that would make the average child a higher, more advanced product of life than the adult or the sage— for certainly the child is the happiest of the three. Is a more objective definition possible? We shall here define progress as the increasing control of the environment by life. It is a test that may hold for the lowliest organism as well as for man.

At any point in time some nations are progressing and some are regressing. Adding even more nuance, nations and people may advance in one area and recede in another.

America is now progressing in technology and receding in the graphic arts. If we find that the type of genius prevalent in young countries like America and Australia tends to the practical, inventive, scientific, executive kinds rather than to the painter of pictures or poems, the carver of statues or words, we must understand that each age and place needs and elicits some types of ability rather than others in its pursuit of environmental control. We should not compare the work of one land and time with the winnowed best of all the collected past. Our problem is whether the average man has increased his ability to control the conditions of his life.

The unhappiness of undertakers as a measure of progress.

The lowliest strata in civilized states may still differ only slightly from barbarians, but above those levels thousands, millions have reached mental and moral levels rarely found among primitive men. Under the complex strains of city life we sometimes take imaginative refuge in the supposed simplicity of pre-civilized ways; but in our less romantic moments we know that this is a flight reaction from our actual tasks, and that the idolizing of savages, like many other young moods, is an impatient expression of adolescent maladaptation, of conscious ability not yet matured and comfortably placed. The “friendly and flowing savage” would be delightful but for his scalpel, his insects, and his dirt. A study of surviving primitive tribes reveals their high rate of infantile mortality, their short tenure of life, their lesser stamina and speed, their greater susceptibility to disease. If the prolongation of life indicates better control of the environment, then the tables of mortality proclaim the advance of man, for longevity in European and American whites has tripled in the last three centuries. Some time ago a convention of morticians discussed the danger threatening their industry from the increasing tardiness of men in keeping their rendezvous with death. But if undertakers are miserable progress is real.

It is no trivial achievement that famine has almost been eliminated and many of the viruses that killed millions worry us not. And yet the probability is that our civilization will die. As Frederick asked his retreating troops at Kolin, “Would you live forever?”

Perhaps it is desirable that life should take fresh forms, that new civilizations and centers should have their turn. Meanwhile the effort to meet the challenge of the rising East may reinvigorate the West.

But great civilizations do not entirely die, they leave fragments. These fragments are the connective tissues that bind us together.

Some precious achievements have survived all the vicissitudes of rising and falling states: the making of fire and light, of the wheel and other basic tools; language, writing, art, and song; agriculture, the family, and parental care; social organization, morality, and charity; and the use of teaching to transmit the lore of the family and the race. These are the elements of civilization, and they have been tenaciously maintained through the perilous passage from one civilization to the next. They are the connective tissue of human history.

If education is the transmission of civilization, we are unquestionably progressing. Civilization is not inherited; it has to be learned and earned by each generation anew; if the transmission should be interrupted for one century, civilization would die, and we should be savages again. So our finest contemporary achievement is our unprecedented expenditure of wealth and toil in the provision of higher education for all.

This calls into question the role of education.

None but a child will complain that our teachers have not yet eradicated the errors and superstitions of ten thousand years. The great experiment has just begun, and it may yet be defeated by the high birth rate of unwilling or indoctrinated ignorance. But what would be the full fruitage of instruction if every child should be schooled till at least his twentieth year, and should find free access to the universities, libraries, and museums that harbor and offer the intellectual and artistic treasures of the race? Consider education not as the painful accumulation of facts and dates and reigns, nor merely the necessary preparation of the individual to earn his keep in the world, but as the transmission of our mental, moral, technical, and aesthetic heritage as fully as possible to as many as possible, for the enlargement of man’s understanding, control, embellishment, and enjoyment of life.

The fragments we transmit to the current generation are richer than ever before. We stand on the shoulders of those that have come before us and in assuming the new height, we attempt to allow others to stand on our shoulders. If we see farther, it is because of this.

If progress is real despite our whining, it is not because we are born any healthier, better, or wiser than infants were in the past, but because we are born to a richer heritage, born on a higher level of that pedestal which the accumulation of knowledge and art raises as the ground and support of our being. The heritage rises, and man rises in proportion as he receives it.

History is, above all else, the creation and recording of that heritage; progress is its increasing abundance, preservation, transmission, and use. To those of us who study history not merely as a warning reminder of man’s follies and crimes, but also as an encouraging remembrance of generative souls, the past ceases to be a depressing chamber of horrors; it becomes a celestial city, a spacious country of the mind, wherein a thousand saints, statesmen, inventors, scientists, poets, artists, musicians, lovers, and philosophers still live and speak, teach and carve and sing. The historian will not mourn because he can see no meaning in human existence except that which man puts into it; let it be our pride that we ourselves may put meaning into our lives, and sometimes a significance that transcends death. If a man is fortunate he will, before he dies, gather up as much as he can of his civilized heritage and transmit it to his children. And to his final breath he will be grateful for this inexhaustible legacy, knowing that it is our nourishing mother and our lasting life.

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