The Religion of Evolution?

I've been reading Phillip E. Johnson's Darwin on Trial with a scientist's eye toward the practice of a sibling discipline. Johnson is a professor of law and as such, familiar with spotting and exposing argumentative fallacies. Numerous times he's already documented strong evidence that Darwinists are essentially assuming their conclusion in order to provide any criteria for interpreting various physical evidences that come along. In other words: classic circular reasoning.

He offers this biting summary of the state of paleontology and anthropology:

The story of human descent from apes is not merely a scientific hypothesis; it is the secular equivalent of the story of Adam and Eve, and a matter of immense cultural importance. Propagating the story requires illustrations, museum exhibits, and television reenactments. It also requires a priesthood, in the form of thousands of researchers, teachers, and artists who provide realistic and imaginative detail and carry the story out to the general public. The needs of the public and the profession ensure that confirming evidence will be found[.]

I'm only partway through the book, but already it seems clear that even the account presented in university-level courses massively understates the complexity of the issue. It may be that natural selection is at operation, but there is nothing like a mountain of fossil evidence showing a smooth record of gradual development of species throughout history.

That's not quite the dispassionate, skeptical, peer-reviewed society which my high school and university courses hailed as the conscience of science. I don't know why practicing biologists can't summon the professional pride just to say, "We don't know" when asked about a theory which is both theoretically plausible and richly physically documented, to explain the origin of humanity. There's no shame or defeat in that; it's just honest science. Shame would be allowing your personal desires to systematically distort the collection, interpretation, and presentation to the public of biological history with no disclaimer given.

No Soup for You

Last night I made another batch of my bean soup whose recipe has evolved over the last year or so. I was bragging too much about the results, and eventually some peer pressure has convinced me to share the trade secret with everybody...

Hardware

• Large stock pot
• Saute pan
• Medium sized pot
• Large electric slow-cook pot (optional)
• Pepper mill

Ingredients

• 8 ounces dried pinto beans
• 4 ounces dried garbanzo beans
• 5-6 red potatoes
• 6 ounces chopped carrots
• 5-6 pearl onions, diced
• 2 tablespoons olive oil
• 8 ounces frozen stir-frying vegetables (snowpea pods, regular peas, baby corn, etc)
• 2 capfuls Mrs. Dash southwest chipotle seasonings
• Crushed red pepper
• Black peppercorns grinder
• Grated Parmesan cheese

Procedure

Beans: Wash all dried beans and place into stock pot. Cover with water and bring to a boil for 2-3 minutes. Remove from heat and cover for an hour to allow beans to expand. Then add chipotle seasonings and (to taste) crushed red pepper. Return to heat and boil as gently as possible for 2 hours. Check every ~30 minutes to make sure enough liquid is present to prevent scorching (add water as needed).

Potatoes: About 30 minutes before beans finish cooking, scrub or peel the potatoes and cube them as if making mashed potatoes. Place into medium pot and add cold water to cover potatoes. Put on burner and bring to boil, then continue boiling until "fork-tender" (approximately 10 minutes). Drain water from potatoes, season with lots of freshly ground pepper, and cover to preserve heat.

Onions: 10 minutes before beans finish cooking, put saute pan on medium heap and add olive oil. When heated, add onions and crank on lots of coarsely ground black pepper. Sweat for 5-6 minutes.

When beans, potatoes, and onions are finished, combine them into stewing vessel. If electric pot is available, use it; otherwise, the stock pot already used by beans will serve. Add chopped carrots and frozen vegetables. If desired, add some whole peppercorns for additional seasoning. Add enough water to cover ingredients.

Bring the mixture to the lowest boil possible (high if you're using the electric gadget) for about 2 hours to soften carrots slightly. Lower heat to simmer (low on the gadget) and cook for at least 3-4 more hours. Serve garnished with Parmesan cheese.

The result was quite tasty. I think I'll open a restaurant so that I can use the line.

Hit the road, you condemners

Some of the most popularly believed arguments for intervention come from neoclassical economists' identification of several phenomena usually lumped together as <reverberation>market failure</reverberation>. The favorite whipping boys are (a) the need for collective provision of national defense and (b) the necessity of forcing pesky holdouts to sell their property so that "sufficient" numbers of roads can be built. Some other time when I feel like writing up a huge treatise on Hans Hermann Hoppe's essay collection The Myth of National Defense, the former will get its just desserts. On the latter topic a new article, The Mythology of Holdout as a Justification for Eminent Domain and Public Provision of Roads by Bruce Benson, popped up in reviews hosted on the Mises Economics Blog a couple days ago.

The usual statement of the holdout problem goes as follows: to build a road requires the road builder to acquire many adjacent independently owned plots of land. Some or all of the current plot owners may decide to "exploit" the road developer by demanding a much higher price than is reasonable. The developer would be in a poor bargaining position because the marginal revenue of the entire project now hinges on only a few parcels of land, and the stubborn sellers know this. Thus the developer would be forced into pre-emptively abandoning the effort altogether because the needed land cannot be purchased at a price making it [the whole road-building enterprise] profitable. Because the last few potential sellers (the holdouts) are able to demand a money payment far in excess of the normal market price which they could fetch—derailing an otherwise socially desirable project—this breakdown of bargaining is usually called a market failure. In order to guarantee that the socially optimal number of roads are built, the prevailing political-economic dogma calls for the government to require the holdouts to sell their property at a State-decided price.

First, an auxiliary definition: most of the property-condemnation theory which gives rise to the government doctrine of eminent domain refers to a desire to promote the public good. For the purposes of analysis, this is taken to be some cumulative measure of the society's wealth. There are two possibilities in which a transaction where A and B exchange properties can be said to increase society's wealth as a whole:

1. Both individuals A and B voluntarily complete the transaction. In this case, both parties value the items received more highly than the items formerly possessed. This type of transaction is called Pareto superior in the literature. Everybody agrees that society wins in this case.
2. Individual A claims to benefit from the transaction, but individual B claims to lose. If an omniscient observer can know that the gainers gain more than the losers lose, then the transfer is Kaldor-Hicks efficient. Mainstream neoclassical economists generally say that society benefits from forcing this transfer to take place. The Austrians strongly contest this.

Even if the feared bargaining failure comes to pass, no external party (a court, a dictator, etc) can say which stalled road projects would really be in the public interest if only the holdouts would sell at their actual use-value, instead of the inflated one they claim to have. Suppose the land owner is dishonestly over-stating his subjective valuation of the land. Even so, the external observer has no way to know by how much; he knows only that the "true" value of the land is somewhat less than claimed. Because no price has been agreed upon, nobody except the holdout has any clue whether or not the extent of B's losses would outweigh the magnitude of A's gains. Thus any attempt to pick a price and use Kaldor-Hicks efficiency as a "social justification" is pure speculation and just as likely to be dreadfully loss-making as helpful.

It might be objected that one could simply compensate B by forcing a price equivalent to the going market rate for the property. But this forgets two very important things. First, if the going market rate is more than what A offers to the holdout B, then A's attempt to get eminent domain exercised and is blatantly "rent-seeking." Otherwise A must have already offered some price higher than the "going rate" and thus the going rate clearly undervalues the property even by A's own admission. Second, according to the elementary notions of the supply schedules taught in microeconomics, market price is only an indication of how many people are willing to sell a good at some particular price. Equilibrium is not a measure of the justness of a price; even at equilibrium, many suppliers withhold their goods.

But, the objector continues, why is it not legitimate to say that B could sell at the equilibrium price since economics teaches that the market-clearing price is an efficient one? One: the purely voluntary market-clearing price is not an efficient price for every participant; some sellers are excluded because their costs (or use-value) are much higher than this price. Two: coercing presently unwilling suppliers to sell at the present equilbrium "going" price would put downward pressure on the "going" price, thus meaning that the going price is determined partially in terms of the number of forced transactions. But this violates the would-be interventionists' prior assumption that the going price is an unmolested measure of the efficient price. Thus an unfounded circular dependency is introduced between the definitions of voluntary price and intereventionist price. This idea can safely be dismissed as nonsensical.

I think this pretty much smashes the idea that there is any good way for the state to impose a recovery from the the road developer and land owner being at permanent loggerheads. But does this hand-wringing situation really occur so often?

It turns out that Benson shows some evidence that it is the very involement of governments with the land-acquisition phase which is likely to give rise to the holdout in the first place. Essentially, private developers only face a holdout when they're in the final phases of a land-buying deal and then a few of the last selllers get wind of what's going on. The trouble, then, only starts once the developer is unable to keep his plans disguised. This is all theoretically possible, but there are several ways that purely voluntary techniques can be used to make sure that the acquisition succeeds:

• Proxy-buyers can be used. These are known to be effective at masking the fact that one particular party is trying to buy a whole bunch of land. Each seller of land deals with a different proxy.
• Collective bargaining (not the gross labor union kind...) with the homeowners, where a term of the contract with each present owner is that the deal only takes effect once everybody agrees to sell. Several of the few cases in the U.S. where large private highways have been attempted (and no eminent domain was threatened) used this idea successfully.
• It usually happens that there is only one possible route for the road. In this case, the developer informs each group of land owners that they have competition. Then the usual bidding and counter-bidding occurs and an external observer can be satisfied that any holdouts who exist are really just insisting upon a price which is just greater than their current use-values for the land.
• A whole bunch of other things that I don't want to list, or that stuffy academic types like me haven't even managed to categorize yet. Come one guys, it's a market! The people on the ground are going to invent and use strategies long before papers are written about them. On this, Benson concludes:

  Actual market participants have discovered many ways to induce people to reveal their relative preferences in situations imilar to those that would characterize right-of-way purchase by private firms, and this really is the relevant issue, even if theorists do not fully understand how these processes might be refined to accumulate the parcels needed for highway routes. (173)

Ironically, it's government involvement that usually is guaranteed to screw up any attempt at maintaining secrecy, and avoiding the stall becomes impossible. Public hearings to allocate funds must by definition be open-book. City councils (or whatever government body exists) are often prevented by regulations from paying more than officially assessed prices. Government bodies move ponderously—there's no chance to quickly pay off all the individual owners before they realize a coordinated buyout is happening. Politicians have every incentive to leak information about acquisitions to cozy developers who would be more than happy to pay a tax-revenue kickback in exchange for condemned land. Any tears that public officials shed when they are regrettably forced to compel a land sale are crodile eyedrops; the very problem they try to correct is way more likely once the pols step into the scene.

There's a lot more to the paper than this. In particular, Benson spends a huge amount of time discussing the likely unconstitutionality of the ways that modern eminent domain is practiced. A couple years ago, anecdotes about courts slowly eroding what I think was the intent of the property rights clauses in the Constitution would have inflamed me. These days, it's mostly just depressing and anticipated. I agree with prominent theorists Walter Block, (previously mentioned) Hans Hoppe, and Tom Woods that paper constitutions are ultimately not so helpful in protecting citizens against government encroachment—it is, after all, a government court which will be deciding between the expropriator and property holder. We shouldn't be terribly surprised that the trend line shows the state gradually winning that battle.

The full article is a good read for those who are looking for some unconventional thinking about one of those staples of market failure dogma. I give it full marks.

Photos

Time to make good on my promise to provide photos of the jog in (well, around) the park. Kari did manage to snap photos both of me and Georg Jung.

Me looking like somebody's just delivered a big sucker-punch.		Georg wearing an intense look.

Red Cross Charity Run

As Ben Dolezal has already written about, today was the date for a short(ish) fund-raising competitive run based in the stadium (sorry for the imprecise map location) used by Manhattan High School's football team. I've been training as a jogger for about the last year, and I'm finally at the point where I can do respectable distances (>= 5 km) without feeling like I've badly taxed myself. So I entered the 5 kilometer division—the first competitive athletic event I ever did. Well... not counting the B-team golf tournaments I played as a first-year high school student.

I ran the course in 21:03, which is significantly ahead of my earlier paces when I practiced the circuit. If my conversions to Imperial units are correct, this puts me at a 6 minute, 46 second rate per mile. That marks a personal best. But, oh man, I paid for it afterward. "Collapsing" would be a kind description of the minutes following the race. Next time I have the occasion to log a few kilometers for some charity event, I'll have to suppress the adrenaline a little bit.

Even though I was burning through my endurance too fast to have sustained the run any longer than the length of the course, it was nice to notice that I could maintain a good pace up the "back stretch" (a long, uphill section). That made good returns in my relative placing.

I don't have a photo at the moment, but one or two may be forthcoming. I imposed last-minute on Kari Wallentine (married to Todd Wallentine, a coworker of mine and fellow runner) to snap a shot at the finish line. In my stupor immediately after finishing, I didn't notice whether she managed to find me. Rumor has it that some kind of photo is also supposed to be deposited in my email inbox by the event organizers. I'll be sure to post some mug shots of me wearing one of those grand three-digit numeric signs if either of those sources lands a picture.

Other participants whom I know: Ben Dolezal, Todd Wallentine, Adam Dolezal (Ben's brother), Georg Jung, and Jeff (a buddy of Georg).

Silver Hurricane Clouds?

As the level of material destruction in New Orleans mounted, I began to have a horrible sinking feeling that politicians would soon proclaim the hidden blessings of all the rebuilding work that will inevitably be done. This kind of thing (which happened after the last few major earthquakes in California, the terrorist attacks on 2001, and the more recent hurricanes to strike Florida) usually goes as follows: "Yes, this destruction is terrible, but think of all the construction jobs created by the rebuilding effort." Or, think back to the more ominous tones in 1945: "This second World War is an unprecedented exercise of human suffering. But we're lucky it saved us from the Great Depression."

Both of these are examples of Frederic Bastiat's Broken Window Fallacy. It's a parable illustrating how people easily get confused about the deadweight loss imposed by natural or human-made disasters. Suppose a bakery's shop window is broken by a vandal hurling a brick. The baker then has to hire a window glazer to replace the shattered pane. The glazer in turn has to order sheet glass from a supplier, glaze from another supplier, and pay some laborers to cut and install the glass. The sheet-glass supplier in turn can hire somebody to supply sand and fuel for his furnace. And so on throughout the entire network of suppliers. A casual onlooker is tempted to say that the broken window is a net gain; after all, a whole cascade of "new" business has been generated at the price of the baker's window replacement costs.

But this totally ignores the fact that the baker was not going to bury in his backyard the money which now has to be spent on a new window. Perhaps he was about to invest in a new oven (and set of a similar ripple effect along the network of producers who supply the oven). Or maybe he was set to buy a new suit from the tailor across the street. Even if this money was to be saved, the act of saving (through banks, stocks, etc) releases resources for somebody else to use. The possibilities are too numerous to predict, but by definition the baker already had something more urgent planned for that money than window replacement. Absent the vandal's action, the baker would have both a window and the fruits of this other planned use of the money. Instead he now has only a window.

I personally attribute a lot of the confusion here to the fact that people get tripped up by the concept of money. They think that cash changing hands constitutes an automatic gain. In macroeconomic matters, it's often helpful to pretend that money doesn't exist at all. If a disaster comes along and destroys a big chunk of resources (war materials, windows, non-earthquake-proof buildings, whatever...) society is obviously less wealthy than it otherwise would have been.

Getting back to Katrina: my suspicions were validated as I listened to syndicated AM radio news this last week. FEMA talking heads were espousing the benefits of the forthcoming vigorous construction boom. It seemed that we are slipping again into this weird fetish that venerates destruction. Then I saw this story running around on MSNBC pointing out the Broken Window Fallacy. In the mass media! Perhaps we'll be spared the politician's claims of a silver lining this time. I remain skeptical, but less sure than before.

In the Headlines

Liberty is all in the news! Well, sort of... the featured article on Wikipedia for today is "Anarcho-capitalism" (proof here). The timing is impeccable; they must have read my startup entry on this site and decided to promote the entry (thanks go to Jesse Greenwald for this link).

On a more technical note, it's nice to see that I listed more of the important stuff mentioned in Wikipedia's synopsis. I did forget to mention Walter Block as an important author in the area. Block, however, sometimes goes too far and proposes ideas that seem like unintuitive and contrived. For example, he decomposes the abortion law question into two issues of killing versus eviction, and a middle-ground compromise is reached by following the "general libertarian" requirement that defensive force be applied in the most gentle manner possible. Example: if somebody is trespassing on your lawn, you must give them verbal notice of eviction before moving to more robust means of repulsion. The analogue would be that an expectant mother may end the pregnancy at any time (Block says that to do otherwise would be to sanction trespass) but this minimal-defensive-force injunction applies. So if the baby is viable already at moment when its removal is decided upon, then the mother is obligated to submit to a medical procedure which will deliver the baby without killing it. If, on the other hand, it's not viable, then regular termination would be the course.

I hadn't ever heard this obligation of minimal defensive force espoused as a formal requirement before. Now, I'm not quite through reading Man, Economy, and State yet, so perhaps I just didn't get there yet. But I don't remember Mises saying anything about it (this is, however, inconclusive—there are lots of things which Rothbard and Hans Hoppe said more conclusively than Mises; he was more of a trailblazer). This lacks the purity of concept (in either way) that I have come to associate with Rothbard-inspired law theory. I don't intend to weigh-in on this topic, just to point out Block's position. To be fair, Block does have his moments. For example, he gives the best refutation of the "roads-as-a-public-good" socialist position that I've ever heard. And his public speaking skills are very, very good.

Sunk Costs

After several days of watching a catastrophe unfold in New Orleans, I now join some of my friends in commenting.

It's becoming clear now that the proximate cause of the persistent flood in low-lying New Orleans is the enwalling of the Mississippi River for the last three and a half centuries. That delta area slowly sinks if not infused with fresh silt by a naturally meandering course of the river. But the river has been fixed in position for a long time now. The result is that apartment buildings which used to be street level are now subterranean (this last anecdote is courtesy of Jesse Greenwald), and by a good measure. As if the city's slow march to lower elevations isn't bad enough, this arrangement has another source of positive feedback. The method of canal-ifying the Mississippi has also prevented it from carrying the silt out to the Gulf of Mexico. Instead, the induced calmness of the waters makes the sediment load deposit continually in the city-surrounded portion of the channel. Dredging has not kept pace with this action, so the elevation of the water level has trended higher and higher. While the city itself sinks. The result is that large parts of the city sit below the actual level of the Mississippi River.

This is a recipe for trouble. It necessitates expensive, ongoing fortification of seawalls to keep the above-ground waters in their place. Lew Rockwell writes a column discussing lots of ways to fairly say that the government has botched the management of this crisis. He gives lots of reasons to think that, were the risks and costs incurred by flooding in New Orleans not paid for in a collectivist (that is, governmental) manner, the seawall would never have breached, nor would the city's flood pumps have fallen out of operation. I think Lew's right on target in his article.

But what of the prevention angle? How would this be dealt with in a free market order? The first bit of an answer comes from John Stossel's article in reason.com, Confessions of a Welfare Queen. John, a fellow who made a transition from liberal to self-proclaimed libertarian, owned a beach house in North Carolina about 100 feet from the surf. It's a known, predictable risk that flooding will destory some percentage of homes in this position. After a decade and a half, this house was washed away. Unlucky Mr. Stossel? No: the government (that is, all taxpayyers) reimbursed him for the full cost of his home. Despite the fact that all parties knew ex ante that this flooding is a calculable risk. The insurance companies certainly knew it: Mr. Stossel's premiums were affordable only because Congress subsidizes their prices. Now, John has since undergone a bit of an ideological "awakening" he doesn't think this was a good arrangement anymore. The article does a good job of pointing out several ways that government subsidies induce people to engage in risky activities which they otherwise would not:

Why subsidize affluent people like Gephardt and me? Why not let us sink or swim on our own? If my house erodes away, it should be my tough luck. [...] Federal flood insurance payments are like buying drunken drivers new cars after they wreck theirs. I never invited you taxpayers to my home. You shouldn’t have to pay for my ocean view.

Then later:

Farmers argue, "We need subsidies -- because the food supply is too important to be left to the uncertainties of free market competition." But farmers who grow beans, pears, and apples receive no government subsidies, and they thrive. Free markets are best at producing ample supplies of everything. Notice any shortages of unsubsidized green beans, pears, and apples? Me neither.

Yes, some farmers have a tough time. Some will go broke and lose their farms. That’s sad. But it’s also sad when people at Woolworth’s or TWA lose their jobs. Letting businesses fail is vital for the creative destruction that allows the market to work. Those who fail move on to jobs where their skills are put to better use. In the long run, it makes life better for the majority.

So the point is: when people are not made to bear the full costs of their actions, risky and/or unprofitable behaviors will dominate more than on an open market. In economics jargon, they will discount the marginal cost of the behavior and therefore shift their demand for it so that more of the risky behavior is "produced" at equilibrium.

So what has this to do with New Orleans? Some allegations have arisen that the levies and pumps maintained by the Army Corps of Engineers had been allowed to fall into disrepair since the mid '60s. If we paraphrase this to the world of agriculture, this is the same thing as letting the seed corn rot over the winter; the valuable capital is not maintained and depreciates. I sympathize with the Corps on a small matter here though: as a government arm their budget is subject to the same lack of rational allocation as any other tax-funded project. As Ludwig von Mises pointed out famously, prices (private market production) are the only way to be sure that the amount of flood protection (or anything else) produced is in agreement with the desires of the consumers (the potential victims of the flood).

Getting back to the Lew Rockwell post about the flooding there:

Only the public sector can preside over a situation this precarious and display utter and complete inertia. What do these people have to lose? They are not real owners. There are no profits or losses at stake. They do not have to answer to risk-obsessed insurance companies who insist on premiums matching even the most remote contingencies. So long as it seems to work, they are glad to go about their business in the soporific style famous to all public sectors everywhere.

Rockwell is driving home with a sledge the point about public stewardship. In any realistic arrangement, a non-subsidized private insurance organization has far longer scope of vision than government secretaries. It is the insurance company which must find its customers voluntarily. If they do a poor job of estimating risks and charge too little to underwrite a flood-prone property, they make losses and (having no taxpayers of last resort to bail them out) must revise their habits.

This is the crucial bit: the insurance companies have incentive to be proactive. Perhaps, in their capacity as a collective bearer of the flooding risk, they would decide that the properties most near the river should simply be left undeveloped as a buffer zone against flooding. This has two advantages: (1) there's no need to rebuild anything if it actually gets flooded, and (2) no big wall need be constructed around the river — the water just overflows here every now and again. I have gathered some anecdotes that this flood control strategy is used to good effect in other river valleys.

But it seems that this sort of thing has little chance to be tested. Already the clamoring for federal aid to rebuild the city has begun. If this socialized risk-sharing model is maintained, the developers of New Orleans have no reason to change their designs. And, more to the point, the idea of subsidizing the rebuilding of New Orleans in the same place violates a cardinal commandment of rational decision making: Don't throw good money after bad investments. Or, to motivate the title of this post, some costs are unrecoverable (sunk). Don't attempt to save them by throwing more money at the issue. Bad investments such as building a city below the level of the water which it neighbors are regrettable, but once committed they are a fact of history. One must not attempt to justify the errors of the past by funneling more resources at an investment which will, from this point forward, make losses. If New Orleans needs an unrequited infusion of taxmoney from outside in order to rebuild, this is a plain-as-day signal that nobody thinks it's profitable to rebuild.

It would be nice to stop paying people to build houses on top of the San Andreas fault, to stop paying farmers to grow unproductive crops, to stop paying the insurance premiums of eroded beachfront homes, and to stop paying for the flood risk in low-lying coastal cities. Let each person pay her own way.

Open for Business

At long last, I hereby return from the netherworld of data archival. Should I become unhumanly ambitious, perhaps my old posts kindly hosted at the former incarnation of Travis Bradshaw's site can be syndicated here. Until that time, the reader will receive full doses only of this new forum.

A word on the title: Anarkhos (an alternative spelling of the more common anarchos) is not the moniker of my supervillian alterego. It is a Greek word translated into English approximately as "without head or chief." I imagine that the majority of my comments will center on the theory and application of anarchocapitalism.

As one of those strange people who enjoys reading scholarly tomes in his free time, I consider myself an adherent to the Austrian School of economics. I particularly admire the contributions of Ludwig von Mises and Murray N. Rothbard. From this angle, the content here will often be critical examinations of state activities and discussions on how a free market order can efficiently serve consumer wants. I enjoy reading libertarian-oriented legal perspectives such as those given by Professors Glen Whitman and Tom Bell at their site, but I lack the law school training and meticulous knowledge of caselaw needed to write that sort of thing.

And, when I'm in a really lazy mood, I occasionally write about everyday technical things such as Linux, GNOME, and whatever software things on which I happen to be engrossed at the moment.