WEBVTT NOTE The Economics and Ethics of Private Property 1 00:00:00.000 --> 00:00:15.000 The book is not an entirely new book. It is just a new edition, an enlarged edition, but I'm sure most people have not seen the book before. 2 00:00:15.000 --> 00:00:27.000 It went out of print many years ago, and thanks to Doug French and Diana Forbusch and the Mises Institute, it just has been reissued. 3 00:00:27.000 --> 00:00:35.000 I just want to say a few words about one of the central themes of the book, 4 00:00:35.000 --> 00:00:43.000 and then make a few remarks about some of the extensions of that central theme. 5 00:00:43.000 --> 00:00:49.000 Economics was once part of what is called a moral science, 6 00:00:49.000 --> 00:00:58.000 And in this moral science, the concept of property was a very important concept. 7 00:00:58.000 --> 00:01:08.000 During the stage of economics being part of moral science, economics and ethics was in a way mixed up. 8 00:01:08.000 --> 00:01:17.000 And in the meantime, the concept of property has almost entirely disappeared from the discipline of economics. 9 00:01:17.000 --> 00:01:26.000 But you can still recognize, of course, that implicitly the concept still plays an important role. 10 00:01:26.000 --> 00:01:33.000 For instance, we could not talk about exchange without having some idea of property 11 00:01:33.000 --> 00:01:39.000 or what is a voluntary exchange that requires us in a way to think about property also. 12 00:01:39.000 --> 00:01:49.000 and even concepts like prices, exchange ratios between different property owners exchanging their property and so forth. 13 00:01:49.000 --> 00:01:57.000 But as a result of economics becoming what is called a value free science, 14 00:01:57.000 --> 00:02:07.000 ethics has more disappeared from the discourse among economists 15 00:02:07.000 --> 00:02:30.000 And despite the fact that even in order to speak about value-free science, we must also presuppose certain values, namely respect for reason, respect for argumentation, the force of arguments, and so forth. 16 00:02:30.000 --> 00:02:41.000 In Mises, you find very little talk about property, especially in his economic works. 17 00:02:41.000 --> 00:02:46.000 You find much more talk about property in Murray Rothbard. 18 00:02:46.000 --> 00:02:56.000 And my book has set itself the task, so to speak, to reintegrate economics and ethics 19 00:02:56.000 --> 00:03:16.000 Without, however, disputing or changing the fact that there is a clear-cut distinction between a value-free positive economics on the one hand and ethics as a normative discipline on the other hand. 20 00:03:16.000 --> 00:03:28.880 And I do this reintegrating of economics and ethics in purely theoretical pieces and also 21 00:03:28.880 --> 00:03:36.060 in a number of applied pieces. What I want to do here in a few minutes is just to say 22 00:03:36.060 --> 00:03:51.060 I would like to say a few words about my writings in the book on pure ethics and then end with a few remarks about applications. 23 00:03:51.060 --> 00:04:05.060 What I try to accomplish in the book is to present some axiomatic foundation of ethics in the same way as Mises presents an axiomatic foundation of economics. 24 00:04:05.060 --> 00:04:28.060 Most of you are familiar with Mises' work where he begins his economics with the so-called axiom or axiom of action and this axiom of action is axiomatic because you cannot not act. 25 00:04:28.060 --> 00:04:35.060 Whenever you try to refute that human's act, you have to engage yourself in an activity. 26 00:04:35.060 --> 00:04:42.060 And so we have, so to speak, a firmly established starting point from which all of economic theory is derived. 27 00:04:42.060 --> 00:04:49.060 And what I do in the book is to show we have in Essex, we have a very similar axiomatic starting point, 28 00:04:49.060 --> 00:04:57.060 which is called the axiom of argumentation or also the a priori of argumentation. 29 00:04:57.060 --> 00:05:13.060 We cannot deny that we can argue, engage in a discussion with each other, because if we would deny this, then we would already be engaged precisely in argumentation. 30 00:05:13.060 --> 00:05:24.060 So we have a firmly established starting point, a starting point that cannot possibly be denied as being a starting point beyond which you cannot possibly go. 31 00:05:24.060 --> 00:05:46.060 And once we have the starting point of, we have to argue with each other, it follows that no statement, no proposition that denies this starting point can possibly be defended. 32 00:05:46.060 --> 00:06:08.060 Or we can also say that whatever must be taken for granted insofar as we engage in discussions with each other cannot again be disputed in terms of its validity because if we would dispute it then we are engaged in what is called a performative contradiction. 33 00:06:08.060 --> 00:06:17.060 The content of our statement would be contradicted by the very fact of making this statement. 34 00:06:17.060 --> 00:06:24.060 And the second thing I do is to delineate what the task of Essex is. 35 00:06:24.060 --> 00:06:32.060 The task of Essex is conflict avoidance or peaceful cooperation. 36 00:06:32.060 --> 00:06:41.060 And we are confronted with the possibility of conflicts because there exists scarcity. 37 00:06:41.060 --> 00:06:51.060 And in order to solve the problem of how can we avoid conflicts, given the fact of scarcity, 38 00:06:51.060 --> 00:06:58.060 it is obviously required that we must have exclusivity rules or rules of property 39 00:06:58.060 --> 00:07:06.060 that assign the right to control scarce resources to one person rather than to another. 40 00:07:06.060 --> 00:07:13.060 So scarcity is one of the requirements of having ethical problems. 41 00:07:13.060 --> 00:07:26.060 And the other requirement for having ethical problems is the fact that we must have rational entities being involved in conflicts. 42 00:07:26.060 --> 00:07:33.060 and other entities that can argue and discuss with each other. 43 00:07:33.060 --> 00:07:42.060 A further requirement for any type of ethics is it must be a discipline that formulates rules which are universalizable. 44 00:07:42.060 --> 00:07:50.060 That is to say, all people, all arguers must be capable in principle of agreeing to these rules. 45 00:07:50.060 --> 00:08:02.060 And a further requirement for any type of ethics is we must formulate rules that allow us to act from the very beginning of mankind on. 46 00:08:02.060 --> 00:08:06.060 That is, we must be able to start right away. 47 00:08:06.060 --> 00:08:14.060 And the solution to this problem is well known in these circles. 48 00:08:14.060 --> 00:08:26.060 That is, we must have self-ownership, we must be owners, exclusive owners of our own physical bodies in order to be able to engage in argumentation. 49 00:08:26.060 --> 00:08:41.060 If I don't own myself and I would not recognize the self-ownership of my opponents in an argument, then obviously we could not possibly engage in I say this, you say something else and so forth, 50 00:08:41.060 --> 00:08:53.060 and arguing back and forth. So self-ownership cannot possibly be denied as a valid principle 51 00:08:53.060 --> 00:09:06.060 without falling into a contradiction. And the second rule is we must have the right to appropriate 52 00:09:06.060 --> 00:09:11.260 Previously Unowned Resources 53 00:09:11.260 --> 00:09:17.980 If we would not have the right to appropriate, acquire the right of exclusive control of 54 00:09:17.980 --> 00:09:23.420 previously unowned resources, then we would all die out. 55 00:09:23.420 --> 00:09:29.660 And if we would all die out, then obviously no ethical problem would exist whatsoever. 56 00:09:29.660 --> 00:09:39.660 So two principles are entirely sufficient in order to come up with a theory of property rights that cannot possibly be disputed by anyone. 57 00:09:39.660 --> 00:09:53.660 The right to own ourselves, our own body, and the right to acquire previously unowned resources and acquire thereby exclusive control over these resources. 58 00:09:53.660 --> 00:09:58.380 And these two principles are by no means just conventions. 59 00:09:58.380 --> 00:10:05.980 Conventions are rules for which we have alternatives, so to speak. 60 00:10:05.980 --> 00:10:17.340 A convention is, for instance, that we use the Latin alphabet when we engage in written communication with people. 61 00:10:17.340 --> 00:10:22.860 And we have an alternative to these conventions. We can also use the Cyrillic alphabet, for instance. 62 00:10:22.860 --> 00:10:35.860 But the rules that I mentioned, self-ownership and ownership in originally appropriated resources, 63 00:10:35.860 --> 00:10:46.860 there is no alternative to them if we understand that the purpose of ethical rules is to avoid any type of conflict 64 00:10:46.860 --> 00:10:51.860 and to allow people to act from the very beginning of mankind on. 65 00:10:51.860 --> 00:11:04.860 No other rules can possibly achieve this result of conflict free interaction except these two rules. 66 00:11:08.860 --> 00:11:17.860 Just a few words about other things that you find in this book, 67 00:11:17.860 --> 00:11:34.860 Besides these purely abstract inquiries about the foundations of ethics, I have a number of applied investigations on money, for instance, 68 00:11:34.860 --> 00:11:44.860 and there I show the importance of the distinction between money as property on the one hand and property titles, 69 00:11:44.860 --> 00:11:53.860 that is, tickets that show you to be the owner of a certain piece of property 70 00:11:53.860 --> 00:12:00.860 and once you introduce the distinction between money as property and property titles 71 00:12:00.860 --> 00:12:11.860 then you come to a correct assessment of the legal quality of fractional reserve banking 72 00:12:11.860 --> 00:12:25.860 Fractional Reserve Banking is nothing else but an increase in the number of property titles without an increase in the quantity of property in existence 73 00:12:25.860 --> 00:12:32.860 which in all other cases would be of course considered to be a fraudulent thing to do 74 00:12:32.860 --> 00:12:38.860 you increase the number of titles to a car without having additional cars available 75 00:12:38.860 --> 00:12:45.860 from which it clearly follows that practices like this should be considered illegal. 76 00:12:45.860 --> 00:12:53.860 I have an investigation about the property status of so-called public goods. 77 00:12:53.860 --> 00:13:07.860 There's a chapter on Marxism and Austrianism showing a certain similarity and yet fundamental differences 78 00:13:07.860 --> 00:13:21.860 For instance about their concept of classes, exploiters and exploited certain parallels and at the same time fundamental differences. 79 00:13:21.860 --> 00:13:35.860 I have a chapter on Keynes where I demolish his theory of money and unemployment and employment. 80 00:13:35.860 --> 00:13:45.860 I have a chapter on Hayek where I criticize Hayek's contribution to the so-called calculation debate. 81 00:13:45.860 --> 00:14:00.860 I believe that the mistake that Hayek makes in contrast to the correct views that Mises espouses is to consider the fundamental problem of socialism, 82 00:14:00.860 --> 00:14:09.860 the fact that certain information is unavailable to people 83 00:14:09.860 --> 00:14:15.860 and that you cannot concentrate all sorts of knowledge in one person's head 84 00:14:15.860 --> 00:14:22.860 and I try to show that the truly fundamental problem of socialism 85 00:14:22.860 --> 00:14:26.860 is rather the fact that there exists no private property 86 00:14:26.860 --> 00:14:37.860 and only because there exists no private property, certain types of information are by definition then not available, namely the information about prices. 87 00:14:37.860 --> 00:15:06.860 I have chapters on the origin of states and the inclination of states or the tendency of states to engage in war and imperialism and in particular also some interesting remarks about what I call monetary, 88 00:15:06.860 --> 00:15:34.860 and Monetary Imperialism, that is the setting up of institutional arrangements that allow some states to exploit the population of other states without going to war through systems such as the Bretton Woods system 89 00:15:34.860 --> 00:15:45.860 and the practice of client states to use the currency of other states as their own reserve currency. 90 00:15:45.860 --> 00:15:57.860 With that I conclude and I give the microphone to my next person. Thank you.