Wednesday, 18 October 2017

How's This For A Great Piece Of Ingenuity?


There's a Mumbai suburban railway system that carries more than 6 million commuters a day, meaning the task for the authorities to check for tickets is extremely difficult. The system to discourage ticketless travel relies on random ticket checking - but with more than 6 million commuters a day, the chances are that if you travel without a ticket you will escape getting caught more often than not.

However, with everyone aware of this low probability of getting caught, this will likely increase the number of people travelling without a ticket, which then increases the number of people that will get caught in a random check.

So, the story goes, someone in Mumbai came up with a clever money-making insurance idea that seems to benefit all parties involved. It works like this - if you are a daily traveller, then you sign up to become a member of this organisation of local train travellers. You pay 500 rupees (which is about £6) to join this organisation of fellow ticketless travellers. Then, if you do get caught travelling without a ticket, you pay the fine to the authorities and then hand over your receipt to the organisation which refunds you all the money.

It's a neat little idea - however, I cannot help thinking that somewhere in Mumbai there is a ticket-collecting company in the making, to whom the train operators could outsource this work, and both parties could clean up.

Tuesday, 10 October 2017

Ask The Philosophical Muser: On MPs' Salaries


Here's my latest Q&A column - if you have any questions for me, you can message me on Facebook, or email them here j.knight423@btinternet.com

Q) When people have been moaning about our mediocre MPs being overpaid, some people have historically argued the opposite: that if we actually raised MPs' salaries we might attract better quality. My question is, what does economics suggest would be more likely, that higher salaries would attract better MPs or that it would just make our current run of the mill MPs even more overpaid?

A) In all probability it would be both. However, while we can all agree that overpaid mediocrity is a bad thing, I'm not sure that raising MPs' salaries to attract better politicians would necessarily be as desirable as you may think.

The reason being, you have to factor in the opportunity costs of having talented people in Parliament. Opportunity costs are the foregone opportunities that occur as a result of something taking place. For example, choosing to go bowling with the lads costs not just the price of the game, it costs in terms of what you might have done instead; a quiet night in with your wife, or a meal out with your family or a trip to the cinema with other friends.

Similarly there are opportunity costs to having very bright and talented MPs in that what is foregone is whatever they would do if they were not an MP. If a talented businesswoman becomes an MP then the UK must lose out on not having her in the business sector where she would probably create more value for society. If a brilliant male scientist becomes a brilliant politician then the UK may miss out on some important scientific discoveries or beneficial fieldwork.

It is far from obvious that a talented businesswoman and a brilliant scientist would do more good in the House of Commons than they would in their fields of expertise - in fact, my off-the-peg hunch is: almost certainly the opposite. Consequently, then, there may even be a good argument for keeping MPs' salaries low in order to dissuade very talented people from entering Parliament and costing society what they would have contributed instead.

Sunday, 8 October 2017

Theresa May Shows Economic Ignorance Of The Worst Kind



"The UK’s Big Six gas and electricity suppliers saw billions wiped off their stockmarket valuations after Theresa May outlined plans to go ahead with a cap on energy prices."

This is on the back of Theresa May's foolish announcement of a draft bill to impose an energy price cap for consumers in order to “bring an end to rip-off energy prices once and for all”.

Alas, because Theresa May is unapprised of basic economics, she seems to have it in her head that the nefarious energy firms are enjoying excessive profits at the expense of their customers. Here's where she is going wrong (any Corbynites who have the same idea about rent controls should grab a pen and paper too).

The word ‘excessive’ is a strange one when talking about profits, because excessive is a term that is relative to a perceived value or number. If the average height for a woman is 5ft 5in, and your sister is 6ft 2in, her height is excessive compared to the average. But ‘excessive’ profits in the market simply mean higher than expected, where expected means marginal revenues equal marginal costs of the standard textbook order we are more used to (most firms make a lot less profit than you probably imagine).

If an entrepreneur is making higher than expected profits, it indicates that he or she evaluated future projections better than competitors did - or if there’s a lack of competition, it indicates that he or she innovated ahead of others in the market. To do this you need to find a gap in the market that isn’t being filled, or identify better than others scarcity of supply or abundance of demand that are not being matched in equilibrium. Such entrepreneurs are the ones most likely to bid up the prices of goods that are not priced high enough, or not in sufficient supply, and push down the price of excessive outputs.

That’s short term. In the long run, though, we don’t want businesses to make excessive profits above the average cost of capital, because it means there aren’t enough competing forces for price efficiency. Competitors are the ones pushing the boundaries of innovation in order that they obtain their share of the profits, and in doing so they are contributing to increased value, better technology, more efficiency, and greater well-being and prosperity.

And that scenario is pretty much always what you see in a competitive market, because in the short term when profits are higher than expected due to some niche being found, or innovation-based success being enjoyed, there is room for others to enter that part of the market and add more value to society (you can click on my Energy part of the side bar to read why there are quite naturally only a few big players in the energy industry, and how they are not charging 'rip-off energy prices' as our dearly confused politicians seem to think). 

I wish our politicians would bear in mind this next important thing too. Most people don't know what it's like to be a large employer, so they hardly ever put themselves in the position of the corporation. They foolishly think that corporations have plenty of spare capital knocking around that can be confiscated and used to ramp up wages and pay people what politicians and their supporters have avowed that they 'deserve' (price caps are merely an indirect form of confiscation).

But even if it were not the case that corporate profits aren't that high, there is an even bigger picture that has to be factored in. Investors in large capital projects are not just the ones making the biggest risk of no return, they are the ones that stand to lose the most if the venture fails.

Good large scale investment is much harder than it sounds - you not only need a good assessment of the current market landscape, you need a solid eye for future landscapes and the concomitant probabilities that accompany that evaluation. This is even more of a compelling point when you remember that average profits hover around the 5%-7% mark. Time you factor in the large amounts of planning, building, and other capital investment to get the project off the ground, many entrepreneurs face a risk of a huge loss for a relatively small gain.

Given the foregoing, it's also easy to see how government policy designed to cap prices or extract high levels of tax from these companies makes the reckless assumption that the company's income will carry on at the same level - often failing to realise that some way down the line, price fixing and heavy regulatory protocols do a lot of invisible harm to businesses - harm that is off the radar - because, like the butterfly effect, the long chain of events that precede it are not tracked by the naked eye, and engender lots of tangible costs down the line that make prospective investment more precarious that it needs to be.

I wish politicians of all party colours would learn the very basic economic principle that you cannot impose these burdening interferences on the signals of supply and demand without changing a lot of behaviour and creating a lot of market disincentives that will have the knock on effect of harming the consumers they think they are helping. and make the marketplace more unstable for prospective investors. 

Saturday, 7 October 2017

God, Mathematics & Münchhausen's Trilemma


At some point I'm going to do the final edits on my book on the question of what one might call 'is-ness' - a series of chapters that attempt to tackle mathematical and philosophical questions related to the question of why there is something rather than nothing. In the meantime, I'll try to summarise the kernel of the book's content in a short blog post. Here goes:

To attempt a philosophical stab at the big question of existence, I get about as far as I think I can get - which is roughly this. Something underpins reality - by that I mean there is a grand explanation for why existence 'is' - a reason that something exists instead of nothing. From what we've covered in previous blog posts, it's evident to me that physical reality isn't it. This leaves, I think, only two plausible contenders: God or mathematics.

Unlike our interpretations of God and mathematics, physics just doesn't seem to amount to a complexity powerful enough to contain an ultimate explanation. When we think of complexity, we think of a lower level complexity and an upper level complexity. The lowest level complexity would be something containing just a single bit of information. But once we start to think of an upper level complexity, we find that there really is no limit to how complex complexity can get. To me, such a realisation necessitates either one of the following:

A} Mathematics is the reason that existence 'is'.

B} God is the reason that existence 'is'.

Which is most likely to be true - A, B or neither? If it's neither A nor B then we are going to have to think up an alternative - and the trouble is, I don't think we humans have one, or are capable of arriving at one. It seems like it has to be God or mathematics, or possibly a concession that the mind goes blank, but where's the fun in that? So, on the question of whether it's God or mathematics, let's explore further.

Some statements can follow from other statements. If a minute is longer than a second, and an hour is longer than a minute, it naturally follows that an hour is longer than a second. Some statements are verified by having evidence to corroborate them. A 2017 Ferrari's 0-60mph time is shorter than a 2017 Nissan Micra's 0-60mph time, and it would be easy to corroborate this in a race.
 
The classic problem with general statements about ultimate existence is that neither of those qualities apply - that is, there are no further statements that can support them, and there is no evidence to corroborate them.

If there's no evidence for a statement, and that statement also follows on inferentially from any other statements, we run up against the Münchhausen trilemma - which says that we have only three options when providing proof:

1) The circular argument in which theory and proof support each other (i.e. we repeat ourselves at some point)

2) The regressive argument in which each proof requires a further proof, ad infinitum  (i.e. we just keep giving unending proof after proof)

3) The axiomatic argument, which rests on accepted precepts (i.e. we reach some bedrock assumption or certainty)

The circular argument says that X therefore Y, and Y therefore X. For example, if the Bible is the word of God it will say it is the word of God; the Bible says it's the word of God, therefore it is the word of God. If the conclusion is also one of the premises, the argument is a logical fallacy.

The regressive argument is where we have a statement P that we try to explain by P1, which needs explaining by P2, and so forth - carrying on into an infinite regress of Ps. For example, God (P) is the cause of the universe. What then caused God (P1)? What then caused the cause of God (P2)?, and so forth.

The axiomatic argument is an argument that is self-evidently true without recourse to further proof. For example, a whole orange is greater than a segment of that orange. There is no logically valid argument that says a part of something is greater than the whole of that thing.

I've thought a lot about why God or mathematics are our best two ultimate explanations for reality, and therefore our two best efforts at conceiving that which is behind the existence of nature. With God or mathematics I think we give ourselves the best chance of reaching a final theory that may avoid circularity; a final theory that may halt the regression; and a final theory that requires the least amount of difficulty in providing justification.

To see why, consider our studies of biology; we can break down biology into eukaryotes, and eukaryotes into introns and exons, and further into encoding, and further into the physics of atoms and electrons, and further all the way down to mathematics. Breaking down different elements into isotypes is not the same thing, though, as breaking down numbers into different constituents of numbers, because with the latter we never depart from mathematics. To ask what is more primary than chemistry or biology is easy; to ask what is more primary than mathematics is probably to be guilty of asking something insurmountably difficult.  

However, mathematics doesn't help us defeat the tripartite problem found in the trilemma. Regressively mathematics seems to be a self-containing system; and axiomatically it provides a bedrock on which numbers are found. It also has a degree of circularity in that at a human level of perception it is bound up in human minds interpreting our own interpretation of reality. But it doesn't seem to me to satisfy the answer to the primary question of 'is-ness' quite as well as God does, and I think there is a subtle reason why, which I'm now going to explain.

Rather than having to choose between God and mathematics, it makes better sense to me to postulate God and mathematics together, with God being primary and mathematics being a property of that primacy cause. It seems to me impossible to even conceive of the mind of God without mathematics, because mathematics is a primary property of thinking.

This is because sentience involves the concept of quantification - there is nothing thought can do without the involvement of numbers. Numbers to thinking are rather like the property of wetness is to water. By the same logic, it seems to me we can't have mathematics without an up and running sentience to think it.

Consequently, out of the two I can make more of a case for God being the primary cause and mathematics being a necessary part of God's mind than I can mathematics being the primary cause with no sentience behind it. To postulate God as the ultimate cause is not to deny that mathematics is more primary than nature - for mathematics may well be instantiated in the mind of God. As I said, it may not even make sense to talk of God's mind or consciousness without imputing some kind of mathematical framework inhered in those Divine thoughts (if God is triune in nature, as Christianity tells us, then numbers are implicit in God's tri-aspectual personality) .

If the Divine mind is the ‘is-ness’ that contains the primary Truth (capital T) that governs existence, then His is the reality from which there is no sense of beyondness. If God is the creator and the Aseity we are looking for to close down the explanatory protocols, then it would stand to reason that it is His mind that has an ontology whose non-existence would be an impossibility, and therefore the reason there is something rather than nothing.

Tuesday, 3 October 2017

How You Should Buy Wine


An advert from a company called Naked Wines came onto my newsfeed this evening, stating that:

"The average £5 bottle of wine sold in the UK only contains about 40p worth of wine. The rest goes on marketing, duty, shipping and packaging. Spend £10 and you get £2.76 worth of wine - SEVEN TIMES more. That’s because every single extra penny is now going towards the juice."

True or false? Well, while one can acknowledge that this is a marketing ploy from a company that appears to be doing very well, there is some truth in it. Given that a proportion of wine's retail price goes towards marketing, duty, shipping and packaging, you will get qualitatively better wine if you spend a few pounds more.

But only up to a point - you'll get to a stage, probably in prices that exceed around £25, whereby you are trading off additional quality for enhanced brand reputation, and it's not always worth it. As we know from past testing, it’s unclear whether anyone can actually tell the difference between a £2,000 Lafite Bordeaux and a £10 bottle of Merlot, as blind tastings and academic studies demonstrably show that neither nascent consumers nor so-called expert judges can consistently differentiate between fine wines and cheap wines, nor identify the flavours within them. So choose your wine carefully - not too cheap but not too expensive either.

To finish, I want to tell you something in economics that may interest some of you. It's to do with how the ancillary charges attached to wine actually create a surprising truth about who drinks the best wine. Consider Burgundy wine, which is shipped from France to the UK. Now ask yourself this question: where do people, on average, drink better Burgundy wine, France or the UK? The obvious answer is France, since that's where the wine is produced. But like many obvious answers, it is likely to be wrong. In actual fact, there is a good reason why people, on average, may drink better Burgundy in the UK. Here's why.

Let us suppose, for ease, that there are only two types of Burgundy wine - wine A and wine B. Wine A is very nice and wine B is quite nice. In France, wine A is £8 per bottle and wine B is £4 per bottle. The relative price of a very nice wine in France is two bottles of quite nice wine. The opportunity cost of a Brit drinking wine A is not drinking 2 x wine B.

However, in the UK the price of wine involves the price of shipping large quantities of wine. Suppose it costs £4 per bottle to ship wine from France to the UK; A Brit must pay £12 for a bottle of wine A and £8 for a bottle of wine B. The relative price of wine A in the UK is only 1.5 x wine B

In other words, a French person who chooses a bottle of wine A passes up 2 bottles of wine B, whereas a Brit who chooses a bottle of wine A passes up just 1.5 bottles of wine B, making wine B more attractive to a Brit than a French person. Because of this, the average quality of Burgundy wine in the UK will likely be higher than it is in France.

Now on that note, drink and be merry, and enjoy your not too cheap but not too expensive wine!! :-)

Saturday, 30 September 2017

Why There Is No Such Thing As The 'Centre Ground' Of Politics, And Never Has Been!


Jeremy Corbyn thinks the political mainstream has shifted to the left of centre, and that his brand of politics is going to be the barometer for many more disaffected voters in years to come. It's hard to say how accurate Corbyn's hypothesis is because there hasn't ever really been a political centre. At best, the mythical centre ground has been a kind of weighted average of a diverse range of socio-political views that encapsulate both left and right wing beliefs in both the social discourse and the economic discourse.

Here's how the myth of the centre gathered intellectual traction over the years. Because of all the left vs. right wing squabbling, many people have tried to claim themselves to be the more reasonable moderates that sit somewhere in between two extremes - in the proudly occupied 'centre ground' of politics. But it's just not true that the best position on most social and political issues lies somewhere in the middle - life is just not like that in most other areas of objective truth and empirical facts, and it's not like that in politics either (see here for further reading).

One doesn't adopt a middle position about whether it's fine to drop litter, or whether it's good to put diesel in a petrol engine, or whether it's wise to accept astrology as true, so why should anyone expect a middle position on subjects like abortion, same-sex marriage, price controls, assisted dying, environmental issues, the qualities of trade and the harms of retarding it? People have convicted opinions one way or the other - and the judgement about who is right and who is wrong is one for the intellect and the emotional intelligence.

There is not some kind of central ground comprising a reservoir of middle positions. The weighted average of socio-political views that make up our society is not like mixing blue, red, yellow, purple and green paint, it is more like a deep pool of blue, red, yellow, purple and green coloured balls. Consequently, when political parties try to win elections by appealing to the so-called centre ground, you know what they are really doing: they are trying to win a popularity contest a la carte by selling themselves as a weighted average of society's preferences, which is as illusory as it is empty (see here and here and here for further reading)

Given the foregoing, to what extent, then, is there a genuine appetite for hard socialism, and to what extent is Corbynmania merely an extreme cult of personality movement that has been allowed to get out of hand by a mob of credulous individuals?
 
 
To see why I think it's the latter, consider this hypothetical question: It's the eve of the Labour leadership contest in 2015, and Jeremy Corbyn is tragically murdered by a far right extremist. One of the other candidates (Andy Burnham, Yvette Cooper or Liz Kendall) becomes leader, and we have an alternative history in which there is no cult of personality developing around Corbyn, no huge influx of new party members signing up, no barmy shadow cabinet that wants to take Britain back to the economic plight of the 1970s - just a mainstream, unremarkable, business as usual Blairite leader that may or may not have gone on to win the next election.

I think it's pretty evident that under this scenario, without Corbyn, this mass proliferation of hardline socialism, the putrid sense of envy and entitlement from the young, and the vulgar and aggressive intolerance for people that disagree with them would not have become as mainstream as it has - it would have remained within the remit of the fringe lunatics who stand on street corners with sandwich boards declaring that "Capitalism is Dead".

The other main reason I suspect that the rise of hard socialism is really about a cult of personality is that this generation more than any other is a generation in which the anachronisms of Thomas Carlyle's Great Man theory - that history is written by the impact of a minority of charismatic and powerful men - have been well and truly put to bed.

If Corbynmania is an attempt to blow the dust off the outmoded idea that individual humans are good candidates for being put on pedestals - an idea that was already beginning to die alongside the likes of Saul Bellow, Philip Roth, Norman Mailer, Kingsley Amis and Harold Pinter - then the intellectual vacuity of the man and his ideas suggest very much that Corbynmania amounts to a personality cult where the leader's proclamations are uncritically and gullibly swallowed whole by a large group of people that are easily led and easily manipulated into some kind of mass hysteria of nonsense.

Thursday, 28 September 2017

Don't Be Fooled By Mrs May: No Party Is Really On Our Side At The Moment


After the Labour Party has spent this week explaining how they plan to ruin our economy if they get in power, soft-socialist Theresa May has come out today in support of free market capitalism. Quite why she did this is beyond me, because everyone knows she's no friend of the free market, and no one is going to be fooled by any claims to the contrary. Actions, as always, speak louder than words - and her actions regarding our economy show that she is very much part of the socialist wing of the Conservative Party.

But alas, she is not alone - there are no defenders of free markets in mainstream politics at the moment - even the conservatism of Thatcher (and even that wasn't wholly market-friendly) was replaced by the Blairite Cameron government before Theresa May took charge. Voters who understand economics, and are therefore small state, low taxation, pro-market voters, have nobody to vote for in mainstream politics.

Aside from the many ways that politicians are harming our economy, what's also happening is that two other things are making it harder for the average Brit to thrive - one is foreign competition (foreigners being able to do things cheaper than us) and two is that competition success is creating a power law whereby more wealth is concentrated into the hands of the world's best innovators.

However, if you remember that the biggest measure of our prosperity is consumption - that is, what we get to consume - then both those things are actually good for us. Foreign competition is good for us because it helps us consume a more diverse range of things less expensively (a double winner) and competition success is good for us because it means big-scale providers are supplying us with things that we value hugely (Apple, Microsoft, Google, Facebook, Amazon, YouTube, Sainsbury's, etc) and doing so by outcompeting less efficient rivals.

Take Google, Amazon and Facebook - the odds are that when you turn on your computer, if you want to search for some information you'll use Google, if you want to buy a book you'll use Amazon, and if you want to do some online socialising you'll use Facebook.

Now the thing is, the market dominance of Google, Amazon and Facebook is not because there is no competition out there, it's because those three are currently the best at what they do. In 25 years it may be that hardly anyone uses any of those sites - they probably won't if they've been replaced by better alternatives. Or quite possibly, those sites will become even better and they will have increased their market dominance even more. The consumer will decide.

As well as being great at what they do, another reason why big companies have a lion's share of the market is that they are also very good at using competition to their advantage. In a highly competitive industry, there is selection pressure on innovation, and penalties for inefficiencies and complacency, so firms are always looking to improve the quality of the good or service and for a price that's more attractive to customers and potential customers.

When big firms get better, they make better profits, which means power law inequalities widen as more money goes to shareholders and those at the top. However, there's absolutely nothing wrong with that, as I explain here - it's simply reward for merit-based ingenuity.

A common misconception is that if workers are getting slightly less of the economic pie then the way to correct it is for politicians to redress the imbalance by penalising the rich with heavy taxation in order to redistribute the wealth more evenly. But this overlooks two key things - one, that the pie is not fixed, and two, that increasing innovation at the top is what is helping to create jobs for the workers.

Therefore, the best way for politicians to address the concerns of the electorate regarding job creation and having enough money to live on each week is to help make the economic pie grow; and the best way they can help the pie grow is by slashing public spending, lowering taxes and lightening regulations that harm growth. That way you help enable competition to flourish, and as we've seen, it is that flourishing that will help the UK become a haven for economic growth that can benefit from foreign competition, from big business innovation and from a bigger sized economic pie.

Two deep contradictions at the heart of the left
The left really need to get their heads around what they believe about the harms of taxation. Here's a test: next time you're with a lefty, try to pin them down on whether or not they acknowledge that tax affects economic behaviour negatively. If they say yes, then you can watch them try to wriggle out of why they themselves don't argue for lower taxes. If they say no, then you can ask them to think about why tax competition is such a prominent thing for attracting businesses through lower taxes, and why politicians try to be a little bit competitive in looking to be parties that lower taxes whenever possible. They can't have it both ways, which kind of tells you all you need to know about the fact that their motives are not really about what's good for the society and the economy.

The other thing that strikes me as odd is that everyone in Labour's shadow cabinet evidently wants to stay in the single market, because even they realise that trading with Europe tariff-free benefits both agents involved in the exchange. But if they can understand that, why don't they apply the rationale to its next logical level - that if open, low-regulation trade enhances mutually beneficial transaction between nations, it is going to do the same between trading agents within nations (like, for example, Uber and its customers, tenants and landlords, etc)? Alas, I think we all know the answer to that, don't we?  





 

Sunday, 24 September 2017

I Can See Why Socialism Would Be Attractive To A 12 Year Old


I saw a statistic from Thomas DiLorenzo that greatly concerned me. Apparently 43% of Americans under 30 view socialism more favourably than capitalism, and 69% of voters under 30 would vote for a socialist Presidential candidate. This is really disturbing and ought to horrify, probably about as much as it should horrify if a young earth creationist was lecturing in biology at Oxford University, or if an astrologer was appointed as a high school physics teacher.

Things are similar in the UK, with Corbynmania becoming an ever-proliferating personality cult based on the crass distortions and uncritical evaluations of its delusional leader. I've just listened to Corbyn's interview on this morning's Andrew Marr Show, where he is practiced in the art of making statements that are attractive to the credulous, and absurd to anyone with a smattering of intellectual curiosity.

I can well imagine being about 12 years old, and hearing positive political aspirations about making society more equal, paying people a 'fair wage' and 'investing' in our economy. But naïve ideas only survive in the heads of naïve people - and once the linguistic manipulation of these words is exposed, and once one develops even a sketchy understanding of the adverse effects that would occur through the introduction of Corbyn's policies, it becomes very easy to grow out of socialism, and somewhat alarming that there are so many young, so-called educated, worldly people that have not rejected it.



 
Socialism and its more aggressive cousin Communism have the most dreadfully tainted of histories - responsible for repeated legacies of dictatorships, mass killings, state-mandated theft, war crimes, environmental destruction, forced labour, famine, drastic food shortages, housing crises, mass unemployment, disease, totalitarianism, censorship, hyperinflation, poverty, and oppression.

One of the big mysteries of the present age is why so many otherwise intelligent people think that this disease of the mind is so laudable and fashionable - they would never point such approbation in the direction of starvation, mass unemployment and oppression, so why do they extol it so fervently when it goes by another name? They hate the symptoms but love the disease that causes those symptoms.

I think the explanation is fourfold. Firstly, they get fatted up by the lies and distortions of the propagandists; secondly, they think that what is being promised is medicine instead of poison; thirdly, they completely misunderstand and are ignorant of all the basic economics that would help them see the error of their thinking; and fourthly, they believe they are doing good, not bad, so their moral suasion pulls them in the direction of these falsehoods.

They have no realisation that the big things they desire: greater living standards for the poor, a cleaner more environmentally friendly planet, less divisiveness in society, better healthcare and social services, a more even distribution of power, more value for money, job creation for the unemployed and a more educated nation are all provided much more readily by markets than they are politicians. Moreover, with some irony the socialists don't realise that every good cause to which they cleave is paid for by the fruits of free market labour - it is trade and competition that produces the tracks on which the carriages of socialism can travel.

It's not just noteworthy how much socialists are actually unmindful capitalists - and how in just about everything they do they rely on something capitalism has provided. It's also noteworthy how the common tactic in cults like socialism, Marxism and young earth creationism is the tactic of proclaiming problems and proffering no solutions. Criticisms of capitalism and biology largely amount to spurious criticisms of the thing in question – they are almost wholly devoid of their own explanations, they are merely parasites that feed off the efficacy of their host organism. For example, read anyone from olden day Marx to modern day Ha-Joon Chang and you’ll find no theories of viable alternatives.

There is no mention of a system better than the system of a free market where decisions are made to create mutual value for buyer and seller. The anti-capitalist rhetoric fails at every basic reality-check, and offers nothing that gets close to matching Pareto’s principle that a nation will progress with economic growth and value if there is increased specialisation. That is, it makes no sense if nurses make their own uniforms or car mechanics grow their own vegetables – it is far better if individuals specialise in a particular skill and engender a free economy of diverse varieties to match the diverse varieties of human beings.

It amazes me how so many people still cling to absurd and counterfactual ideas about how the state over-wielding its influence is to be preferred over the prosperity of the free market and increase in trade. One of the main reasons it amazes me is because history furnishes us with repeated real life social experiments that confirm beyond any doubt that what causes increased prosperity and happier citizens is free trade, which is underpinned by competition.


If you want a large scale example of the effects of our being back into self-sufficiency from a comparably good market system, you have the collapse of the Roman Empire and the ushering in of the Dark Ages, where free trade was retarded by a mass de-urbanisation process that put us back a few rungs on the evolutionary ladder of social progression.
 
Or perhaps you could consider the alternative paths that Germany took after it was divided into West Germany, a parliamentary democracy that embraced the free market and went on to be the most prosperous economy in Europe, and East Germany, a Communist dictatorship that provided its citizens with economic stagnancy thanks to the Marxist-Leninist Soviet-led influence.

You may like to look at the difference between the dreadfully closed state hegemony of North Korea and the hugely prosperous market-embracing South Korea; or the difference between Hong Kong, one of the freest markets in the world, and other nearby Asian nations that didn’t follow suit. Or, if you get time, read this lovely little IEA article Latin America: A tale of two continents by Diego Zuluaga Laguna about South American prosperity that saw individual nation growth commensurate with each nation’s opening up of freer trade.

All of these examples share a vital piece of wisdom – more trade and less state equals better and more prosperous societies. It’s not rocket science. Why after repeated demonstrations of this does anyone with an ounce of realism still support the woefully misguided rhetoric from neo-socialists who still want to run on about all the things that retard progress, growth and well-being?

The reality is, with the rise of the personality cult of Corbynism we are seeing one of the biggest mass delusions this country has ever seen. And the only way to stop it is by the same method we use to stop childhood guilelessness; by growing up and growing out of it.  

* For additional consideration, if you want more things to read on this matter, in particular how the burden of regulation stultifies growth, Dan Mitchell from International Liberty is well informed about how it affects things like aggregate cost, job losses, time wasted, and foregone growth.

Wednesday, 20 September 2017

What's The Answer To Reality's BIG Big Question?


The biggest philosophical question of all is Why is there something rather than nothing? That shouldn't just mean Why does our universe exist at all? - as it so often seems to have been adapted to mean, it should mean something even more profound: Why isn't it the case that absolutely nothing exists at all?

The most rigorous popular attempts to answer this have been put forward by the likes of Stephen Hawking and Lawrence Krauss, both of whom tried to solve the problem by positing highly spurious notions of what 'nothing' actually means and how 'something' can apparently come from this 'nothing' of theirs (I wrote a response to their dodgy hypothesis in this blog post).

The upshot is, even if we accept the highly dubious notion that universes can somehow arise from nothing, this doesn't give us any clue about why the things that supposedly came from nothing couldn't have been vastly different. Why couldn't there have been no laws of physics, or no things at all that are not 'nothing'?

I think what looks to me to be the most reasonable explanation is that every single thing that can be said to have existed - that is, every thing that is a something and not nothing - is at its most primary essence a mathematical object. Anything that is physical or has any kind of physical laws is made of mathematics (in that it has the fundamental property of mathematics). This means that the primary question - Why is there something rather than nothing? - is really a question about why mathematics seems to have a necessary existence - that, in fact, whatever 'nothing' means in terms of physical things that may or may not exist, mathematics seems to not be able to help existing - it cannot do anything but exist.

On a place like the Internet you will find people who insist that mathematics is a mere human invention that we use to explain theories about the physical world. It's a strange view to have, because it appears to be completely wrong. As an example, consider Fermat’s Last Theorem, which states that a, b, and c satisfy the equation an + bn = cn for any integer value of n that equals at least 3. In other words, if you write four positive numbers and n is greater than 2, the equation an + bn = cn  will never be true.

Fermat’s Last Theorem is not self-evidently true - it took nearly four centuries to prove, and is true based on propositions about the property of numbers, not based on anything physical or on anything anyone has invented. It was true long before we came along to think it, and it would be true in any in universe with any physical laws and properties. Consequently, then, it doesn't satisfy the proposition of being a human invention nor something we use to explain theories about the physical world.

Another reason to believe that numbers exist is that we directly perceive numbers, and we tend to believe that the things we perceive do exist in some meaningful sense. The brown table I'm sitting at seems to exist - I am directly perceiving it. But if I got up and stood at each corner, I would observe a slightly different table from different angles each time. The shading of the colour brown changes according to my relative positions in the room, and my perception changes in accordance with where the light is shining in. The smoothness exists, but its texture depends on my reference point of observation. From a distance I see the table as being smooth, but with a powerful microscope I see lots of pits and crevices.

Nobody who stands next to the table denies that it exists, nor my hands that are rested on it. The apparent reality of the physical world conceals much activity, of which our naked eye is largely unaware. My hand is made up of skin and flesh and bone, which are oscillating molecules, which are an arrangement of bonded atoms, which are an aggregation of particles about one-hundred-millionth of a centimetre. Once we zoom in on the atom its solidity becomes hazier and cloud-like until we encounter its empty space. If we look further we would find the atom's nucleus, around which we would find particles called protons and neutrons and electrons - hundreds of thousands of them within one atom.

If we could enlarge a single atom to measure fifty yards in diameter its nucleus would be about the size of a grain of sugar, and its electrons would be like a few specks of dust circling the nucleus at a distance of about twenty-five yards. That tiny grain of sugar-size nucleus amounts to most of the atom's solidity, yet it only occupies a comparatively small fraction of the atom’s total volume (only about one millionth). 

Given that the table is made of atoms, in what way can the table be said to exist? It exists though our sense data, what Kant called 'phenomena', and it gives its appearance relative to the person perceiving it. Do you still think the table exists - and if so, in what way can it be said to exist given that its existence relies so heavily on sensory perception?

Hold that thought. Let's now turn to Kurt Godel - one of the smartest mathematicians ever, and probably the smartest logician. Here's one of his most well known quotes:

"Despite their remoteness from sense experience, we do have something like a perception of the objects of set theory, as is seen from the fact that the axioms force themselves on us as being true. I don’t see any reason why we should have less confidence in this kind of perception, i.e. in mathematical intuition, than in sense perception."

Godel's position is the right one, I think. If you're going to trust that the reality you perceive is based on things that actually exist, it seems quite a bizarre strategy to believe that objects that change according to sensory perception are the things that really exist, and that numbers, which do not change according to sensory perception, don't really exist. If we're going to believe in the concrete existence of anything, mathematics seems to be the one thing we definitely can believe exists.

Whichever way you cut the cloth, the thing about which we can seemingly be most certain is that the answer to the question Why isn't it the case that absolutely nothing exists at all? is that numbers exist, they always have always will, and they cannot help but exist.

Monday, 18 September 2017

Ask The Philosophical Muser: On Attacking Burglars and Good Gift Buying


Here's my latest Q&A column - if you have any questions for me, you can message me on Facebook, or email them here j.knight423@btinternet.com

Q) What is the economics consideration regarding whether society is better off if house owners can attack burglars that enter their property?

A) Well firstly, I wholeheartedly support a victim's right to defend themselves if a burglar illegally enters their property. I support this on grounds that I think people should be entitled to defend themselves and their family when in danger, and when someone forces their way into your home their incentive not to get caught and arrested is enough to make them a viable threat.

As for the economics, burglary has an immense social cost for the victims (not just having your valuables stolen, but also the sense of being intruded upon), but a relatively low cost for the perpetrators because conviction rates are low, and for many burglars addicted to drugs, life in prison won't be much worse than their current life situation. Therefore, a law that increases the costs for victims and decreases the costs for burglars is a highly questionable one.

The other thing to consider is that the law probably wouldn't do much good anyway. The kind of people that feel sufficiently threatened to the extent that they would use physical force against a burglar are unlikely to be the kind of people that would refrain from doing so because of a law that forbids them from doing so.

Q) What’s good wisdom for mastering the art of great gift buying?

A) You’re asking the wrong person – ask my wife, she’s the best gift buyer I’ve ever met. I, on the other hand, am the world’s worst gift buyer – pretty much every bit of wisdom I’ve picked up I’ve picked up from my wife. She’s so good that she buys me things I didn’t even know I needed, but was chuffed to bits when I received them. That’s the epitome of a good gift.

The other bit of wisdom I’ve distilled is that gifts are well chosen when they are gifts the receiver wants but wouldn’t necessarily buy for themselves.

Good gifts do other things too – they make the giver and receiver emotionally closer, and they help create memories (either experiences or objects) that stay with the receiver long after the gift is given. Great gift-buying exhibits a signal that you understand the tastes, wants and needs of the person for whom you’re buying – making the gift as much about the thought behind it as the thing or experience in itself. If you can perfect all that, you’ll be a) a great gift buyer, and b) mastering something I haven’t yet mastered.

Thursday, 14 September 2017

Richard Dawkins Gets This Argument Entirely Backwards


I caught Richard Dawkins' appearance on Bill Maher the other night, and alas, nothing much has changed - he still doesn't quite get this whole complexity thing. He's always been stuck on the notion that the cause for why there is something rather than nothing must have been something alarmingly simple, because "complex things had to emerge, by gradual degrees, from simpler beginnings"

Not only does Dawkins have this entirely backwards, he doesn't seem to be able to intellectualise the fact that if he turned his proposition around 180 degrees he'd have a much better argument for atheism than his current playpen philosophy. Because it is evidently not true that complex things have to emerge gradually from simple beginnings - the natural numbers are more complex than anything in the physical universe and they don't satisfy the condition of emerging by gradual degrees from simpler beginnings.

Dawkins is desperate to be seen as one of the smartest atheists, yet staring him in the face is the best argument against God he could ever come up with - that the universe doesn't need a creator God because it is the result of mathematics.

Instead of arguing that God does not exist because complex things must begin with simplicity, he would have been better trying to argue that God does not exist because complex things do not have to begin with simplicity, therefore the complexity of mathematics could be behind the universe instead of God. Anyone tempted to argue that numbers don't actually exist can be directed to where I've covered this at least twice before (here and here).

It wouldn't be quite so bad if Dawkins failed at that level of the task - that would be somewhat understandable. But alas Dawkins takes his argument down an even more preposterous cul-de-sac:

"Where does Darwinian evolution leave God? The kindest thing to say is that it leaves him with nothing to do, and no achievements that might attract our praise, our worship or our fear. Evolution is God's redundancy notice, his pink slip."

Oh dear! Biological evolution can't serve God His redundancy notice because biological evolution (at best) explains organisms that evolved with biological properties, and that has never been the ultimate thing that needs explaining. Asserting that biological evolution implies God has nothing to do is as silly as saying that filling a hotel with staff and guests implies that there was nothing for the planners and builders to do in constructing the hotel. 
 
Biological evolution only explains the relatively easy part - that is, once we have the mathematical underpinnings, the laws of physics, and the informational platform, then biological life, once it gets going, is a relatively straightforward step by step cumulative selection process, certainly in comparison to creating a universe and designing the complex physical laws that act as a canvas for the colours and textures of evolution of life.

The hard part is in explaining why the universe is made of mathematics, why there is any mathematics at all, and why anything so complex exists in the first place. The natural numbers show that Dawkins' underpinning premise is wrong: complexity can not arise only from simplicity. You can use just a fraction of the complexity of the natural numbers to encode the entirety of the genomes of every living thing biochemistry has ever created.

So in my view the best argument for the non-existence of God is that there is already something infinitely complex that could explain the existence of nature - numbers and the laws of arithmetic. This does not prove or disprove God, of course, but it does show that Dawkins has this entirely backwards, and cannot even recognise a better proposition for the cause he wants to champion.

Whichever side of the line you fall on - theist or atheist - the most primary fact you have to begin with is the fact that something infinitely complex exists (the natural numbers), that it has always existed, and that it stands outside of the constituents of evolved nature.

Further reading - The Mathematical Bias Theory: Why There Probably ‘IS’ a God – in 20 Steps

Sunday, 10 September 2017

'Schrodinger's Leftist' Simultaneously Misunderstands Both Schrodinger & Leftism


Schrodinger's leftist: a leftist who is simultaneously a cowardly snowflake and a violent thug.

Popular cultural terms alluding to Schrödinger's cat (like Schrödinger's immigrant) can be quite effective because they take a small liberty to reveal an apparent contradiction, while playing on the nature of a superposition of possibility - something that's easy to grasp if you properly understand Schrodinger's thought experiment.

For those less familiar, the thought experiment called ‘Schrödinger’s cat’ by Erwin Schrödinger proposed a scenario with a cat in a sealed box, with its life or death being dependent on the randomness of radioactive decay breaking a container of poison and killing the cat. With the Copenhagen interpretation*, Schrödinger's conclusion implies that the cat remains both alive and dead because neither possibility has any reality unless it is observed.

That is to say, unless we open the box, the cat remains in a ‘superposition’ state of being both alive and dead, because in the everyday world events are governed by probabilities, and whether through decay a radioactive atom will emit an electron is down to probability

So with something like Schrödinger's immigrant, the point being made is that sections of society as a whole are trying to have their cake and eat it by painting immigrants in a 'superposition' state of being bad for the country because they come here to work and take jobs, and at the same time here to laze around claiming unemployment benefits (which is a contradiction - at best an immigrant can work and have his or her pay topped up with benefits).

Those who have been lauding the Schrodinger's leftist meme are not seeing either picture, as there is no contradiction at all between a leftist being both a cowardly snowflake and a violent thug. Once you remind yourself how easy it is for them to be both, it'll be easy to see the defect in the perceived contradiction.

As we're seeing far too often these days, many on the hard left quite seamlessly fluctuate between the two extremes when the matter suits them. When encountering people that disagree with the views and beliefs they are promoting, they become whiny snowflakes determined to take offence, regularly attempting to censor or shut down opinions they do not like. However, when encountering people promoting views they disagree with, they take to the streets in mobs, often becoming intimidating and aggressive towards people that stand in their way.

There is more than enough cognitive dissonance and internal dissension in the average hard leftist for them to house in their cranium cowardly snowflake traits and violent thug traits, and unleash them in whichever way suits their cause. There need be no contradiction at all.  
 

* The Copenhagen interpretation says that because we require photons to detect electrons' positions, and this then alters their momentum, the uncertainty principle is actually a failure of our measuring ability, and an artefact of the observer effect/wavefunction collapse. The ‘hidden variable’ interpretation maintains that there is an incompleteness to our ability to work with quantum systems and that in actual fact elements of reality are sufficiently hidden, prohibiting us from identifying a more deterministic system. With the Copenhagen interpretation there are two levels of uncertainty going on; the uncertainty due to the intrinsic disorder of the system but further uncertainty by our disturbing the system by hitting electrons with photons. 
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