Monday, January 28, 2013

Ron Paul vs. The Liberal Leadership Race

The Liberal leadership officially kicked off the other week with a debate in Vancouver. The nine contenders didn't offer much in the way of strategy or ideas other than "we won't work with the NDP" and "Stephen Harper sucks." Of course, the language wasn't so direct. Only Joyce Murray was willing to co-operate with the NDP to bring down the Harper Regime.

When Justin Trudeau said, "It’s not enough to replace Stephen Harper with someone else. We need to replace him with a very, very clear vision of where we’re going forward," Murray responded, "Justin, that all sounds very good, but if you want to replace Stephen Harper, where’s your plan?" The only plan Justin Trudeau has is one of a carbon tax. Combine that with his socialist father and elitist upbringing -- the Tory campaign machine would have a field-day if (or when) Trudeau wins.

Clearly, the Liberals are out of ideas. The debate consisted of shots at Stephen Harper and vague notions of electoral reform. However some of these Grits understand the fundamental problem at stake here.

Former astronaut Marc Garneau proclaimed that the Liberal leadership race should be about "ideas." "This race," Garneau said, "must be about defining who we are, what we repressent, and what we stand for,” he said.

Deborah Coyne insisted that "Canadians do want substance, no matter what the cynics say. They want a leader who is not afraid to answer the inconvenient questions."

With views like these, I can't understand why at least one of these Liberals haven't taken note of Ron Paul. He's not "America's true conservative" he's America's classical liberal. Despite being retired from Congress, this principled politician is leading an intellectual revolution. Now I've written at length about this before, here, here, here, here, here, here and here. This post will take a different angle. I won't discuss Ron Paul or the Liberal Party in depth, but rather, the true liberal philosophy and why it is essential that the Liberal Party adopt these principles for a Canadian audience.

Ludwig von Mises, the 20th century's greatest classical liberal and contributor to economics, has much to say about liberalism. He even wrote a book about it. Here some of his thoughts from a life-time of writing, teaching and speaking:

Economic knowledge necessarily leads to liberalism

Liberalism champions private property in the means of production because it expects a higher standard of living from such an economic organization, not because it wishes to help the owners.

That Liberalism aims at the protection of property and that it rejects war are two expressions of one and the same principle.

The only task of the strictly Liberal state is to secure life and property against attacks both from external and internal foes.

Freedom, democracy, peace, and private property are deemed good because they are the best means for promoting human happiness and welfare. Liberalism wants to secure to man a life free from fear and want. That is all.

To the man who adopts the scientific method in reflecting upon the problems of human action, liberalism must appear as the only policy that can lead to lasting well-being for himself, his friends, and his loved ones, and, indeed, for all others as well.

According to Mises, the scientific method in economics and other social phenomena is praxeology. The problem with social liberalism is that the economics it uses ignores praxeology and thus is fundamentally unscientific. This despite the economics mimicking of the scientific method of the hard sciences. 

Liberals that ignore or misunderstand the basic axiomatic principles found in praxeological economics tend to advocate social liberal policies that cause effects counter to their intended aims. This is due to confusions in the definition of words like "capital," "value," "prices" and "utility." Take capital for example: Praxeologically, it is the complex structure of scarce resources - complementary factors - that are a result of savings. The social liberal is usually an unapologetic Keynesian. John Maynard Keynes and his followers insist that savings are destructive and that capital is an arbitrary K found in an equation where no constants exist. The K describes a homogeneous blob of capital goods represented by a number. The deductive reasoning of Ludwig von Mises defines capital by the former definition.

Social liberalism uses words that if taken literally lead to absurdities. The reason for this, as previously hinted at, is the confusion of economics as a social phenomena that can be explained by the scientific method of the physical sciences, such as physics and chemistry. This helps explain why the language would lead to logical fallacies. If economics is instead investigated through methodological individualism, it is revealed as a social phenomena that explains how wealth results from the intentional states that motivate individual actors. For human beings have free will and therefore must be "measured" by different means. Or, free will is an illusion but as human beings, a complete mathematical theory must contain "fuzziness" since it is based on fundamental probability and uncertainty. As human beings the uncertainty principle must apply when we investigate ourselves.

Praxeology, and the methodology it uses, has been criticized by mainstream economists such as Mark Blaug who wrote,

it is helpful to note what methodological individualism strictly interpreted ... would imply for economics. In effect, it would rule out all macroeconomic propositions that cannot be reduced to microeconomic ones, ... this amounts to saying goodbye to almost the whole of received macroeconomics. There must be something wrong with a methodological principle that has such devastating implications. [emphasis mine.]

Many 18th century physicists developed models known as "aether theories" to explain the propagation of electromagnetic and gravitational forces. Prior to Einstein’s special relativity, aether was commonsensical fact. Now it's obsolete. Clearly, there must be something wrong with Einstein's theories that they would have such devastating implications.

Einstein's theories are now empirically proven. But as a science built from the logic and language of human beings, Einstein's theories never needed empirical proof. They were accepted as fact despite their - at the time - untestable nature. The same goes for the early quantum mechanic scientists. They were using the language and logic of math to explain what was - at the time - untestable and supposedly irrational. Praxeology doesn't use numbers, but it follows a chain of reasoning that begins with irrefutable axioms about human action. Praxeology explains observations about economic events like the Great Depression or what happened in 2008.

Classical liberalism is correct on economic issues, that voluntary association and exchange, private property and free markets are the best means for sustainable prosperity. Social liberalism - ignorant to the cause of "market failures" - expanded the state's role by creating a "social safety net." But the act of forcing money from people promotes wastefulness (namely, capital consumption) and is counter to the ethical case against theft. To take a cue from Rothbard's Ethics of Liberty,

Lord Acton wrote that, "Liberalism wishes for what ought to be, irrespective of what is." What ought to be is the natural law of human beings. The very notion of "natural law" has been cast aside as unscientific and many consider it to be a conservative philosophy. Murray Rothbard writes,

How has natural law become generally classified as “conservative”? Professor Parthemos considers natural law to be “conservative” because its principles are universal, fixed, and immutable, and hence are “absolute” principles of justice. Very true—but how does fixity of principle imply “conservatism”? On the contrary, the fact that natural-law theorists derive from the very nature of man a fixed structure of law independent of time and place, or of habit or authority or group norms, makes that law a mighty force for radical change.

If a comparable definition of liberalism is one of anti-conservatism, then clearly natural law should be categorized under the liberal philosophy. This is justified further by the fact that liberalism, at least in a Canadian context, has always championed "facts, evidence and statistics," as opposed to ideology. Natural law is a social science; a scientific inquiry into an objective good.

Leonard Carmichael has indicated how an objective, absolute ethic can be estab­lished for human beings based upon biological and psycho­logical trends:

Because man has an unchanging and an age-old, genetically determined anatomical, physiological, and psychological make-up, there is reason to believe that at least some of the “values” that he recognized as good or bad have been discov­ered or have emerged as human individuals have lived togeth­er for thousands of years in many societies. Is there any reason to suggest that these values, once identified and tested, may not be thought of as essentially fixed and unchanging? For example, the wanton murder of one adult by another for the purely personal amusement of the person committing the murder, once it is recognized as a general wrong, is likely always to be so recognized. Such a murder has disadvantageous individual and social effects. Or to take a milder example from esthetics, man is always likely to recognize in a special way the balance of two complementary colors because he is born with specially con­stituted human eyes.

A social animal, human beings rely on order and cooperation to survive the harsh environments of the planet. Through the division of labour and voluntary exchange of private property, the human race overcomes the harsh poverty of survival. The natural law of human beings is one where reason determines, not the means in which brings about maximum utility, but the ends. Contrast to economics, in natural law, value is objective. A critical analysis of Canadian society should indicate where the natural law is being violated in numerous ways by the "might-is-right" positive law.

Using reason to determine human nature is controversial and for good reason. An "objective good" is a position not everyone adheres to. However, a "subjective good" is a reality of acting human beings. With or without natural law, the logical framework that is economics is a science.

One can label Ron Paul's philosophy as "conservative," "libertarian",  "classical liberal" or even "anarchist." But in reality it is merely the scientific analysis of acting human beings. If the Liberal Leadership hopefuls really adhere to their non-ideological basis for governing, that facts trump dogma and that the Liberal Party is -- as Martha Hall Findlay put it -- "the true alternative," then they need to start reading about Austrian economics and a voluntary social order. If they really care about ideas, then it's time to embrace some. Traditionally, it is the State that opposes the ideas generating from the populace. In this case, it can be the political means initiating ideas for the populace. Either way, Victor Hugo words still ring true: "One resists the invasion of armies; one does not resist the invasion of ideas."

Or as Butler Shaffer put it,

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