WEBVTT NOTE The Austrian Theory of Subjective Value: A Philosopher's View 1 00:00:00.000 --> 00:00:13.000 Let me read a passage, actually a little bit from a comment I made on an article that was recently published in Reason Papers by Nicholas Bergeron 2 00:00:13.000 --> 00:00:26.000 in an essay in which he laments the fact that any libertarians would worry about issues like how do we know what is right and wrong? 3 00:00:26.000 --> 00:00:49.000 Advocates of a certain set of first-order moral views, such as classical liberalism, should cease trying to construct and present arguments as to the meta-ethical basis of these views. 4 00:00:49.000 --> 00:00:56.000 Now, that was a quote that's basically saying that meta-ethics does not matter. 5 00:00:56.000 --> 00:01:05.000 The question of how do you know what is right and what is wrong could be abandoned and nothing much would be lost. 6 00:01:05.000 --> 00:01:09.000 Although, notice there is a little should in this. 7 00:01:09.000 --> 00:01:13.000 They should cease trying to construct and present arguments. 8 00:01:13.000 --> 00:01:22.120 What I ask in a somewhat catty way is, how does he know this to be so that we should do that? 9 00:01:22.120 --> 00:01:28.960 If I, such an advocate, keep being concerned about metaethics, am I doing something wrong? 10 00:01:28.960 --> 00:01:34.720 Because I'm doing something I shouldn't be doing, according to this author. 11 00:01:34.720 --> 00:01:37.680 How do we know that? Does that not matter? 12 00:01:37.680 --> 00:01:41.160 Well, I think it does, and let me just give you a very simple example, 13 00:01:41.160 --> 00:01:46.760 but amongst academicians I think it'll ring at least plausible. 14 00:01:46.760 --> 00:01:53.380 If my students cheat and I fail them and they found out that my belief that they owe honesty 15 00:01:53.380 --> 00:01:59.560 about whether they are the authors of their works is merely something I happen to prefer 16 00:01:59.560 --> 00:02:05.880 but I also believe that someone else could as easily prefer being clever and a cheat, 17 00:02:05.880 --> 00:02:08.980 neither of you is better grounded than the other, 18 00:02:08.980 --> 00:02:14.900 Don't they have a case against me, to the school, to my dean, to my chair? 19 00:02:14.900 --> 00:02:24.100 I have imposed on them a standard I believe there are no grounds for and ruin their academic record in the process. 20 00:02:24.100 --> 00:02:36.060 I am in fact doing something like malpractice in education by applying standards of right and wrong in the classroom for which I have no defense. 21 00:02:36.060 --> 00:02:37.300 I have no argument. 22 00:02:37.300 --> 00:02:40.580 I cannot claim that these are the right standards. 23 00:02:40.580 --> 00:02:45.660 According to this view, therefore, I think we need to rethink that. 24 00:02:45.660 --> 00:02:56.340 And there is a little bit of this that circulates at least among some Austrian economists and social philosophers. 25 00:02:56.340 --> 00:03:02.940 And I want to read you a passage from one such person, Professor Don Bellante, 26 00:03:02.940 --> 00:03:11.900 who in the Austrian Economics newsletter on spring-summer 1989 said the following, 27 00:03:11.900 --> 00:03:21.100 quote, the Austrian approach is most distinct from mainstream economics in its thorough emphasis 28 00:03:21.100 --> 00:03:26.300 on the individual decision-maker as the focus of scientific analysis. 29 00:03:26.300 --> 00:03:32.620 Yet, with the values and motives of individuals being entirely subjective, 30 00:03:32.620 --> 00:03:44.220 It is impossible for an analyst to pass judgment on the optimality of the individual's chosen action." 31 00:03:44.220 --> 00:03:52.220 Maybe this is a bit of an extreme statement, but then why would I bother using a very congenial statement of this position? 32 00:03:52.220 --> 00:03:54.520 I would have nothing to talk about, right? 33 00:03:54.520 --> 00:04:02.220 So here is a position that seems to me to be wrong or at least disputable and controversial, 34 00:04:02.220 --> 00:04:07.420 and it's associated with Austrian economics, and I think it's worth taking a look at. 35 00:04:08.820 --> 00:04:13.720 This claim is what it seems to disturb some moral philosophers, 36 00:04:13.720 --> 00:04:18.720 even among those who otherwise find the Austrian economic approach very appealing. 37 00:04:19.220 --> 00:04:28.220 And this is because, for one, such a subjective value theory would appear, at least at first inspection, 38 00:04:28.220 --> 00:04:37.220 to undermine the idea that free markets are better arrangements of economic affairs than planned or controlled ones. 39 00:04:37.220 --> 00:04:41.220 And obviously this is because of the word better. 40 00:04:41.220 --> 00:04:49.220 There is something amiss here. If we think that something is better but our value theory is completely subjective, 41 00:04:49.220 --> 00:05:06.220 It would appear that we are doing something odd. We are undercutting our own commitment to this supposedly better economic arrangement by declaring that it's no more than a preference, no more than a subjective value for us. 42 00:05:06.220 --> 00:05:15.220 It also seems flatly contradicted by other ideas on ethics and economics that appear to make entirely good sense. 43 00:05:15.220 --> 00:05:32.220 and even amongst many libertarians, myself included, such as the namely that what people do as they act in their capacity as market agents can be morally evaluated. 44 00:05:32.220 --> 00:05:42.220 That is to say by the whole field of business ethics, which I know at least six philosophers with libertarian political outlooks 45 00:05:42.220 --> 00:05:51.220 and great respect for Austrian economics teach regularly at universities, myself included. 46 00:05:51.220 --> 00:06:00.220 Business ethics assumes that people who are in the commercial arena, who are professionals in that, like people in business, 47 00:06:00.220 --> 00:06:07.220 have the capacity to do right things and wrong things and that this can be known. 48 00:06:07.220 --> 00:06:12.220 This is known. This is not just something that we happen subjectively to believe. 49 00:06:12.220 --> 00:06:20.220 We don't look at somebody who acts somewhat dubiously in the marketplace in various ways, 50 00:06:20.220 --> 00:06:25.220 like discriminates against people who have irrelevant traits, 51 00:06:25.220 --> 00:06:29.220 and yet he takes them against, holds against them in the trade relationship, 52 00:06:29.220 --> 00:06:36.220 and say, this is merely my subjective preference, but if you hate blacks, well, that's okay. 53 00:06:36.220 --> 00:06:46.220 Well, that's okay. That's your subjective preference. This doesn't seem to square, at least, even at the most elementary and primitive level with the field of business ethics. 54 00:06:46.220 --> 00:06:50.220 Correct me if I'm wrong, but you can do that later. 55 00:06:50.220 --> 00:07:01.220 Anyway, now let me turn a little bit in a little more detail to this subjective value theory and vis-a-vis political economy. 56 00:07:01.220 --> 00:07:22.220 As I mentioned before, better is a value assessment, and if it were purely subjective, the claim that free markets are better than alternatives would be nothing more than an expression of a subjective personal preference, which it clearly isn't intended to be. 57 00:07:22.220 --> 00:07:36.220 Now, of course, one may say, but all we mean is that by better is that it's more efficient at accomplishing the goals that we want to have accomplished. 58 00:07:36.220 --> 00:07:46.220 However, usually, if it works better, it's more efficient, the question can arise, efficient for what purpose? 59 00:07:46.220 --> 00:07:59.220 Is it better for oppressing people? Is it better for, you know, being slothful, or imprudent, or dishonest, or what is it better for? 60 00:07:59.220 --> 00:08:09.220 And if you say, well, it's better for, say, creating prosperity, or increasing knowledge, or helping to develop the quality culture, 61 00:08:09.220 --> 00:08:20.220 Then you then maybe have to go to a level of discussion in which you have to defend whether those objectives themselves are better. 62 00:08:20.220 --> 00:08:34.220 In other words, once again the question kicks in, have we any grounds for believing that the things for which markets are most efficient are worth being efficient for? 63 00:08:34.220 --> 00:08:41.220 I mean, if the market turns out to be a very efficient place for promoting child molestation, 64 00:08:41.220 --> 00:08:44.220 I don't think too many people would favor markets. 65 00:08:44.220 --> 00:08:47.220 Well, maybe there would be some, but not too many. 66 00:08:47.220 --> 00:08:49.220 Let me put it this way, okay? 67 00:08:49.220 --> 00:08:55.220 So, you cannot really escape some level of value judgment 68 00:08:55.220 --> 00:09:02.220 and then the question of whether it is an objective judgment or merely a subjective preference 69 00:09:02.220 --> 00:09:11.220 as you discussed the merits of free markets as against centrally planned or controlled or regulated markets 70 00:09:11.220 --> 00:09:21.220 which we generally too, many people in the Austrian school not only engage in what might be called pure scientific economic analysis 71 00:09:21.220 --> 00:09:29.220 but they go on from there and say and because of this analysis we ought to have a free market 72 00:09:29.220 --> 00:09:36.200 and that ought would have no standing I would maintain if you generalize the way 73 00:09:36.200 --> 00:09:43.340 Bellanta does the Austrian subjective value theory. Now there is another thing 74 00:09:43.340 --> 00:09:51.700 about protesting coercive interference in market affairs and it probably couldn't 75 00:09:51.700 --> 00:09:56.780 be evaluated as wrong either if it were a matter of subjectivity. What's wrong 76 00:09:56.780 --> 00:10:00.780 What's wrong with someone restraining trade? 77 00:10:00.780 --> 00:10:02.780 Well, I don't like it. 78 00:10:02.780 --> 00:10:05.780 That's not really a very persuasive answer. 79 00:10:05.780 --> 00:10:07.780 That you don't like something. 80 00:10:07.780 --> 00:10:09.780 Maybe I don't like the color orange. 81 00:10:09.780 --> 00:10:11.780 You notice I'm wearing it, and if you don't like it, 82 00:10:11.780 --> 00:10:14.780 I'm not going to say, wow, that's very important 83 00:10:14.780 --> 00:10:16.780 because that's a subjective preference of yours. 84 00:10:16.780 --> 00:10:18.780 This is a subjective preference of mine. 85 00:10:18.780 --> 00:10:21.780 And we usually do not impose these on one another. 86 00:10:21.780 --> 00:10:23.780 We don't think that these are vital enough 87 00:10:23.780 --> 00:10:52.780 The problem is that if you criticize coercive measures taken by others, whether they be the majority, or their representatives, or just some bureaucrats, or whoever, you are making some sort of value judgment. 88 00:10:52.780 --> 00:10:58.780 And here again, the subjective theory would seem to undercut this possibility. 89 00:10:58.780 --> 00:11:06.780 So I want to propose that some kind of an adjustment be made on the subjective value theory, 90 00:11:06.780 --> 00:11:13.780 an adjustment that would not really undermine some of its most valuable aspects, 91 00:11:13.780 --> 00:11:19.780 namely paying attention to individual desires and wants and preferences, 92 00:11:19.780 --> 00:11:31.780 but not be so sweeping as to eliminate the possibility of making moral judgments of people's behavior, conduct, your own and those of other people's. 93 00:11:31.780 --> 00:11:40.780 And I would like to substitute for the notion of subjective value theory something that, by the way, is not terribly original with me. 94 00:11:40.780 --> 00:11:46.780 It has been proposed by others but not necessarily in this particular discussion or this context. 95 00:11:46.780 --> 00:11:55.780 In this context, and I want to call this individualist value theory or as some philosophers would call it agent relative value theory. 96 00:11:55.780 --> 00:12:07.780 When people act, these acts can be evaluated as right or wrong, but most often only if one has a clear understanding of these individuals, 97 00:12:07.780 --> 00:12:17.780 Their Circumstances, Talents, Purposes, and the broader category of entities to which they belong, such as the human species. 98 00:12:17.780 --> 00:12:26.780 Only in the case of rights violating conduct could it be known generally that they're acting wrongly. 99 00:12:26.780 --> 00:12:32.780 I'll give you a little example of how this comes to the fore among some Austrians. 100 00:12:32.780 --> 00:12:49.780 When I first ran across Walter Block's book, Defending the Undefendable, he basically endorses all these rather questionable forms of conduct as perfectly okay because they don't violate rights. 101 00:12:49.780 --> 00:12:55.780 For example, littering is okay, it doesn't violate rights, prostitution is fine, it doesn't violate rights. 102 00:12:55.780 --> 00:13:02.340 Rights. All kinds of things are supposedly morally okay, simply on the 103 00:13:02.340 --> 00:13:09.020 basis of not violating rights. On the other hand, I would say that if my child 104 00:13:09.020 --> 00:13:17.660 was contemplating a career move and decided prostitution is sort of like, you 105 00:13:17.660 --> 00:13:23.500 know, it's a lucrative field, I think I'll embark on it. I'd probably confidently, 106 00:13:23.500 --> 00:13:29.500 without too much subjective worry, would claim that that's a bad move. 107 00:13:29.500 --> 00:13:34.000 That's not what I would recommend, and I would try to raise some more objection. 108 00:13:34.000 --> 00:13:38.000 I wouldn't make it universal. I could see some circumstances in which 109 00:13:38.000 --> 00:13:44.500 prostitution may be an acceptable course of conduct, emergency circumstances, 110 00:13:44.500 --> 00:13:49.200 really strange ones where there's no other way to make a living or something like that. 111 00:13:49.200 --> 00:13:57.000 So I don't want to make it a universal judgment, but it's a sort of a judgment that I think most parents will sympathize with, 112 00:13:57.000 --> 00:14:02.240 and most friends of anybody who might go that way might also sympathize with, 113 00:14:02.240 --> 00:14:09.680 and not say, oh, well, it doesn't violate any rights, therefore there's nothing one can say about these things. 114 00:14:09.680 --> 00:14:12.440 And this is the extreme to which one can go. 115 00:14:12.440 --> 00:14:22.440 And here I am talking about somebody, Walter Block, who is not exactly a tangential figure in the Austrian economic community. 116 00:14:22.440 --> 00:14:31.940 He's a fairly prominent figure and yet at least one of his books seems to perpetrate the kind of redactio ad absurdum 117 00:14:31.940 --> 00:14:38.940 that one can point to in order to undermine this subjectivist value theory. 118 00:14:38.940 --> 00:14:57.440 Now, such a theory, what I call the individualist or agent-relative value theory, does afford us the possibility of making value judgments that are objective, but rarely universal, just as my example shows. 119 00:14:57.440 --> 00:15:05.940 There are lots of cases of this that you know of when you deal with your friends, when you have local knowledge, intimate knowledge of people. 120 00:15:05.940 --> 00:15:17.980 You know that they often do bad things that other people, not in the same circumstances or different attributes or characteristics or history, would not be faulted for. 121 00:15:17.980 --> 00:15:32.640 If a parent, for example, squanders his life or money on adventures and risks his life, you can say there is something wrong with that in light of the responsibility that that parent has assumed. 122 00:15:32.640 --> 00:15:43.140 If you're a single person and you want to do the same thing, maybe that is indeed your telos, your end, your best way of life, and the two are not comparable. 123 00:15:43.140 --> 00:15:47.440 Both, however, can, I think, be objectively evaluated. 124 00:15:47.440 --> 00:15:58.440 It's not a mere subjective preference that one expresses when one says, you know, parents ought really to pay some attention to the upbringing of their children. 125 00:15:58.440 --> 00:16:02.540 This is not just, well, parents have that preference. 126 00:16:02.540 --> 00:16:23.740 So I want to say that we have this view that is individualist enough, and thus serves as a bulwark against those who claim to know the grand scheme of things and pretend to have these universal moral judgments that they'll impose on everybody, 127 00:16:23.740 --> 00:16:29.740 And yet it doesn't give away the game by being extremely subjective 128 00:16:29.740 --> 00:16:35.500 and by ripping the ground from underneath itself in defense of liberty. 129 00:16:35.500 --> 00:16:43.060 There is another bulwark against central planning and regulation in such a theory 130 00:16:43.060 --> 00:16:51.660 and that is that in this particular theory of individual ethics, 131 00:16:51.660 --> 00:16:58.740 There is a certain important and undeniable role for choice. 132 00:16:58.740 --> 00:17:02.420 Choice is the vehicle of morality. 133 00:17:02.420 --> 00:17:06.300 Without choice, morality is just an empty gesture. 134 00:17:06.300 --> 00:17:10.260 It may talk about good behavior or desirable behavior, 135 00:17:10.260 --> 00:17:15.580 but not about gaining moral credit or gaining moral blame. 136 00:17:15.580 --> 00:17:18.820 If you are not free to choose your conduct, 137 00:17:18.820 --> 00:17:29.620 And indeed one of the objections we have as libertarians, maybe not as Austrians, but as libertarians to much of statism is that it shortcuts our moral agency. 138 00:17:29.620 --> 00:17:39.020 It makes it impossible for us to be moral agents since we are under the gun and we have to follow marching orders of other people. 139 00:17:39.020 --> 00:17:46.740 If you, however, admit to this notion that there is a proper role to objective morality in human life, 140 00:17:46.740 --> 00:17:54.460 then I think the idea that the coercers are doing something objectively wrong, 141 00:17:54.460 --> 00:18:02.340 rather than you just don't like what they're doing, gains certain credibility and plausibility. 142 00:18:02.340 --> 00:18:05.620 Now, I will bring this to a close. 143 00:18:05.620 --> 00:18:10.620 Because I don't want to go on too long because I'm sure there will be some interesting questions afoot here. 144 00:18:10.620 --> 00:18:24.620 What about economic analysis, pure and simple, in light of this supposedly revised value theory of individual rather than subjective values for human beings? 145 00:18:24.620 --> 00:18:31.620 Now, economics as such does not require making moral judgments about how people act. 146 00:18:31.620 --> 00:18:36.700 I'm not saying there is no moral component to the economic game because I think that 147 00:18:36.700 --> 00:18:43.260 insofar as economics presupposes private property rights and insofar as private property rights 148 00:18:43.260 --> 00:18:50.700 have a normative component, namely I ought to be in charge of what I own or my resources 149 00:18:50.700 --> 00:18:56.940 and my life and my labor and not somebody else, it's not entirely possible to remove 150 00:18:56.940 --> 00:19:02.780 the normative element from economics, but once that's given, I think the rest of it can kind of fly 151 00:19:02.780 --> 00:19:10.300 without much attention to morality. When one purchases a coat, that is a fact that figures 152 00:19:10.300 --> 00:19:16.940 into economics. Whether one ought to buy the coat is irrelevant. I mean, I might go home and my, 153 00:19:18.940 --> 00:19:25.020 you know, significant other might say, you've got 13 coats, why you buy another one? You idiot! 154 00:19:25.020 --> 00:19:27.020 and blame me for it, you know? 155 00:19:27.020 --> 00:19:30.620 On the other hand, for the economist, that is of no significance. 156 00:19:30.620 --> 00:19:36.820 They don't care whether you go home and you get beaten up by your spouse for being a splurge, you know? 157 00:19:36.820 --> 00:19:44.320 On the other hand, the subjective value theory, when put in the general way that Bellanda puts it above, 158 00:19:44.320 --> 00:19:47.920 rules out all objective value judgments. 159 00:19:47.920 --> 00:19:54.120 And so, this notion that somebody might criticize you for your behavior in the marketplace 160 00:19:54.120 --> 00:20:02.920 and then by a generalized leap of business ethics as such, is kind of wiped clean of it. 161 00:20:02.920 --> 00:20:08.820 Whereas in this view, even though for the strictly scientific economic purpose, 162 00:20:08.820 --> 00:20:16.720 the value judgments don't matter, because you take out this generalized aspect of subjective value theory, 163 00:20:16.720 --> 00:20:21.220 you retain as a social philosopher, maybe not as an economist, 164 00:20:21.220 --> 00:20:32.220 But at least as a political economist or a social philosopher, the possibility of making plenty of room for morality in looking at market behavior. 165 00:20:33.220 --> 00:20:34.220 Thank you very much. 166 00:20:39.220 --> 00:20:47.220 We'll take questions. Before we do, I'm going to take the prerogative as the director, just to correct something that people had said about Walter Block. 167 00:20:47.220 --> 00:21:14.220 I agree with that, and he did do that, but I was still sort of surprised how readily, 168 00:21:14.220 --> 00:21:19.580 sort of, for example, Hayek jumped on the bandwagon endorsing the original version 169 00:21:19.580 --> 00:21:24.620 which basically wiped morality clean out of the whole realm of social life 170 00:21:24.620 --> 00:21:27.340 except for when it was rights violating. 171 00:21:27.340 --> 00:21:32.140 And so I'm mentioning it only in the first edition. 172 00:21:32.140 --> 00:21:38.380 I think there are two conceptions of subjective value that 173 00:21:38.380 --> 00:21:40.700 some Austrians I think have been guilty of confusing. 174 00:21:40.700 --> 00:21:42.860 I think Mises sometimes confuses them. 175 00:21:42.860 --> 00:21:44.860 I think, for example, Rothbard does not. 176 00:21:44.860 --> 00:21:48.860 Once a conceptual subjective value is explanatory, 177 00:21:48.860 --> 00:21:52.860 you want to explain people's behavior, you explain it in terms of the values 178 00:21:52.860 --> 00:21:54.860 and beliefs held by that person. 179 00:21:54.860 --> 00:21:57.860 You don't appeal to your own values to explain what they're doing. 180 00:21:57.860 --> 00:22:01.860 You appeal to their values to explain why they perform the actions they perform. 181 00:22:01.860 --> 00:22:04.860 And then you build up a whole social explanation out of individuals 182 00:22:04.860 --> 00:22:07.860 following their values whatever they happen to be. 183 00:22:07.860 --> 00:22:11.860 And I think that's the core notion of subjective value 184 00:22:11.860 --> 00:22:23.860 that is operative in Austrian economics, I think it's a mistake, and I do think Mises is guilty of this, it's a mistake to slide from that to the view that you're evaluating behavior, 185 00:22:23.860 --> 00:22:32.860 that once again it's just a matter of subjective value, and Mises thought that the only recommendations you could give are ones that simply appeal to the values of what we have, 186 00:22:32.860 --> 00:22:38.860 and you can show them the means to the values, but you can't criticize the values themselves, 187 00:22:38.860 --> 00:22:46.860 And I think that that's not entailed by the first kind of subjective value, but it's confusing that... 188 00:22:46.860 --> 00:22:53.860 Well, it is made often enough, unfortunately. The thing is, of course, that a great many economists, 189 00:22:53.860 --> 00:23:01.860 like almost practitioners of every intellectual discipline, engage in a certain bit of imperialism. 190 00:23:01.860 --> 00:23:04.860 Philosophers have been guilty of that, and so have... 191 00:23:04.860 --> 00:23:20.860 I want to rescue one of the most potent intellectual disciplines and schools 192 00:23:20.860 --> 00:23:26.860 in support of a free society from easy rejection. 193 00:23:26.860 --> 00:23:32.860 So I would like to urge those who are taking Austrian economics seriously 194 00:23:32.860 --> 00:23:39.980 To resist the temptation to make this leap that you and I both agree is an unwise leap to make, 195 00:23:39.980 --> 00:23:42.860 but unfortunately it is a frequent one. 196 00:23:42.860 --> 00:23:48.700 And there are lots of people who are sort of heroes of libertarianism, 197 00:23:48.700 --> 00:23:52.220 like Thomas Sasse, who make leaps like that, you know. 198 00:23:52.220 --> 00:23:55.500 You would say, and I think that this is a mistake, 199 00:23:55.500 --> 00:24:00.620 and especially when you are under besieged as a school of thought, 200 00:24:00.620 --> 00:24:06.220 When you are not riding the tide of popularity at most universities, 201 00:24:06.220 --> 00:24:12.720 you've got to be a little bit careful not to commit these faux pas that otherwise, 202 00:24:12.720 --> 00:24:18.620 for others, might be excused as just overstatements and just a little hot-headedness, you know. 203 00:24:18.620 --> 00:24:27.020 And that's why we are here, sound-minded, wise philosophers coming to visit the economists. 204 00:24:27.020 --> 00:24:38.520 You summarized Block's point as that he portrays the behaviors in The Defending the Inevitable as okay because they don't violate rights. 205 00:24:38.520 --> 00:24:41.520 In the original book, the original edition. 206 00:24:41.520 --> 00:24:56.520 I would say that that's kind of a misinterpretation, even in the original version, in the sense that I think what Block is really trying to point out is that the behaviors that are typically deemed as immoral are in fact well-produced. 207 00:24:56.520 --> 00:25:03.520 I don't know if it's... 208 00:25:26.520 --> 00:25:53.520 I don't think so, not at all. If you understand the individualist ethics as a genuine moral point of view, rather than just some sort of behavioralistic or behavioristic set of guidelines, then you recognize that although you can criticize others, you can implore them to act differently, or try to convince them to act differently, 209 00:25:53.520 --> 00:26:23.520 As a civilized community would hope people would do, when they dislike something about other people instead of going over there with a baseball bat, they would send them an email, you know, which is a far more civilized way of trying to get them to come around to the right way of behaving, but that's not enhanced by saying, oh, this is all subjective, because then when you go over with a baseball bat, that too is subjective and you cannot really condemn it. 210 00:26:23.520 --> 00:26:34.520 So even your move that rights violating is wrong, but everything else is subjective, is undercut by claiming that everything is subjective. 211 00:26:34.520 --> 00:26:43.520 Because frankly, why is it wrong then for someone to try to impose his values on anybody else? 212 00:26:43.520 --> 00:26:50.520 You may say you don't like it, you may say you don't prefer it, but you can't say it's wrong. 213 00:26:50.520 --> 00:26:57.520 And in a way, Block undercuts himself by saying that everything else is subjective except this one thing. 214 00:26:57.520 --> 00:27:05.520 Why that one thing? I have no reason from him, at least not in the original edition of his book, 215 00:27:05.520 --> 00:27:10.520 to accept that there is this little exception where a bit of objectivity is preserved. 216 00:27:10.520 --> 00:27:40.520 seems like Rothbard never makes this mistake in the video, he is always very careful to, and I appreciate Rothbard, because he is so important to Mario, so even if there are mistakes, like I said, Rothbard's influence is so great that he seems to have overshadowed that in so far as, in his work, in his work, in his work, in his work, in his work, in his work, in his work, in his work, in his work, in his work, in his work, in his work, 217 00:27:40.520 --> 00:28:05.520 I don't doubt it. I mean, as I say, if the shoe fits, you can wear it. If it doesn't, then that's fine. 218 00:28:05.520 --> 00:28:09.520 I don't doubt it. I mean, as I say, if the shoe fits, you can wear it. 219 00:28:09.520 --> 00:28:12.800 If it doesn't, then I'm not talking to you, you know. 220 00:28:12.800 --> 00:28:17.760 Unfortunately, there is a tendency in scientific economics 221 00:28:17.760 --> 00:28:24.440 to generalize the explanatory to wipe out the normative. 222 00:28:24.440 --> 00:28:29.880 And this, by the way, is not unique to the Austrian School 223 00:28:29.880 --> 00:28:35.080 or even to economics of a variety of schools of economics. 224 00:28:35.080 --> 00:28:44.440 There is a tendency in much of scientific social analysis to remove the norm of development, 225 00:28:44.440 --> 00:28:49.720 which I think has its consequence, something we observe throughout the country and throughout the 226 00:28:49.720 --> 00:28:57.000 world, of not ever blaming people for anything they do, whether they are lazy or whether they 227 00:28:57.000 --> 00:29:05.000 are angry or whether they are hasty or whatever, but always invoke some sort of a class analysis 228 00:29:05.080 --> 00:29:13.080 or poverty analysis or something that explains their behavior and thus, in effect, if you 229 00:29:13.080 --> 00:29:21.400 put it all together into a coherent picture, exculpates what they do from any moral judgment. 230 00:29:21.400 --> 00:29:27.080 And you do have to, I think, pay attention to these various areas, how they hang together 231 00:29:27.080 --> 00:29:37.880 and make sure that as you defend the subjective theory as perhaps a valuable tool of explanation, 232 00:29:37.880 --> 00:29:47.200 you don't make the mistake of extending it too far so that it wipes out the moral dimension. 233 00:29:47.200 --> 00:29:56.180 Let me just add something here because the idea that it has explanatory value itself can 234 00:29:56.180 --> 00:30:01.180 can, of course, be argued with, and that's one of the reasons that a great many economists, 235 00:30:01.180 --> 00:30:07.220 although not necessarily Austrian economists, talk about revealed preferences, where they 236 00:30:07.220 --> 00:30:17.020 only look at what people do, and so then the explanation has the great tendency to become 237 00:30:17.020 --> 00:30:18.020 tautological. 238 00:30:18.020 --> 00:30:19.620 Why are you doing things? 239 00:30:19.620 --> 00:30:23.940 Well, I'm doing them because I have this preference. 240 00:30:23.940 --> 00:30:27.940 How do we know that that's the preference that you have, is that I'm doing things. 241 00:30:27.940 --> 00:30:32.700 So it's kind of a circular explanation, and I'm not sure how that can be rescued, but 242 00:30:32.700 --> 00:30:34.980 I'm sure you've given that more thought than I have. 243 00:30:34.980 --> 00:30:39.980 Well, let's just scare the fact of scarcity, that is, that there has to be a ranking of 244 00:30:39.980 --> 00:30:40.980 preferences. 245 00:30:40.980 --> 00:30:47.660 In a world where not all human wants can be observed by giving an article, then people 246 00:30:47.660 --> 00:30:49.220 have to write their preferences. 247 00:30:49.220 --> 00:30:54.600 But isn't that the same thing as saying that, well, people will have to behave differently 248 00:30:54.600 --> 00:30:59.280 from how they might wish to behave because of scarcity. 249 00:30:59.280 --> 00:31:04.780 But it doesn't explain their behavior, it is just something we observe. 250 00:31:04.780 --> 00:31:10.380 We can take notice of the fact that people behave in certain ways in markets in light 251 00:31:10.380 --> 00:31:16.860 of scarcity, but is this an explanation or is this just an observation? 252 00:31:16.860 --> 00:31:24.300 I think it's a deduction from the fact that scarcity does exist, people can't have all they want, 253 00:31:24.300 --> 00:31:29.220 each person's resources are limited, and therefore they have to allocate them. 254 00:31:29.220 --> 00:31:37.860 And they're going to allocate them in a way that will, in their view, maximize or optimize their satisfaction. 255 00:31:37.860 --> 00:31:45.260 So at that, they may be wrong, ex post, they may have made mistakes, but ex ante, you know, that... 256 00:31:45.260 --> 00:31:56.260 Let me put it this way, I don't want to get into this whole thing because this opens another area of investigation which we don't have any time for, nor do I necessarily say that I'm the best one to do so, but anyway, you had a comment. 257 00:31:56.260 --> 00:32:05.260 My comment is that Rothbard says that that's not the task of economics is to figure out why we make the choices we make. He specifically says that's the task of psychology. 258 00:32:05.260 --> 00:32:06.260 Well, even that is... 259 00:32:06.260 --> 00:32:11.260 ...as given and then evaluates the consequences of the notion of choice. 260 00:32:11.260 --> 00:32:24.260 If I think his point was deeper than that, even demonstrated preference, as Rothbard would use that term, is tautological according to what he would say, because I'm reading him. 261 00:32:41.260 --> 00:32:44.260 Reframing the Argument for the Free Society 262 00:32:44.260 --> 00:32:48.260 It was published by St. Martin's Press back in 1990 263 00:32:48.260 --> 00:32:51.260 It's available in a cyber edition 264 00:32:51.260 --> 00:32:57.260 You can always put it in and it's sold on the internet as a cyber book by some people who are into that 265 00:32:57.260 --> 00:33:00.260 And it contains a good many of these things 266 00:33:00.260 --> 00:33:08.260 Both the historical analysis, discussions of the neoclassical and the Austrian school and so forth and so on 267 00:33:08.260 --> 00:33:13.720 and so on. So, any of you who really want to get into that and don't mind looking 268 00:33:13.720 --> 00:33:21.980 through my work, you might want to do so. Tabor, this is a subject that we've been 269 00:33:21.980 --> 00:33:29.500 debating for many, many years in different variations and that reminded me 270 00:33:29.500 --> 00:33:36.060 that the quote from Bellanti actually came from the 1980s. Yes, 1989. Yeah, we've 271 00:33:36.060 --> 00:33:55.060 We've been looking at this issue and I think it comes down to the fact that the Austrian schools label their value theory subjective and you label your philosophical approach objective and therefore you have this sense that there is some need to bring them together in some coherent fashion. 272 00:33:55.060 --> 00:34:21.060 Now it's been my position that know that subjective value in the Austrian approach is not meant to be dismissive as if, okay, something is subjective while, you know, it's not as if we're casting off the problem of moral judgment, we're simply leaving it to the philosophers and the theologians to deal with those type of matters. 273 00:34:21.060 --> 00:34:32.060 Now with that being said, you know, with my position being different from yours on the question of is the market better in an ethical judgment sense? 274 00:34:32.060 --> 00:34:48.060 I've actually kind of reversed myself since we last took up this issue in a sense, or in the sense that I think that the market actually is a better ethical, ethically generating system 275 00:34:48.060 --> 00:35:18.060 and all other approaches and the one thing that really changed my mind in this regard or at least got my attention going in that direction was the Enron fiasco where we had several layers of government, many different types of agencies and agents sort of monitoring the behavior of this social entity and none of them really coming up with any solutions to the problem with Enron and it was really the market. 276 00:35:18.060 --> 00:35:47.060 I'm an entrepreneur, an investment analyst and a newspaper person who found the ethical problem and it was the stock market and the marketplace itself that ultimately made the decision and meted out the punishment in that particular case and as I said that case has sort of got my attention drawn to the fact that the marketplace seems to really be better, systematically better, 277 00:35:48.060 --> 00:36:01.060 Well, back in 1983, M. Bruce Johnson and I edited a book called Rights and Regulations for Valentine, which contained a whole bunch of essays, 278 00:36:01.060 --> 00:36:14.060 and some of them indeed made that point way before Enron, that one of the big consequences of government regulation is a demoralization effect, that everything becomes a matter of law. 279 00:36:14.060 --> 00:36:33.620 I had a friend who worked for IBM for years and years and she used to tell me that whenever IBM made a decision as to how it should conduct itself overseas, domestically, vis-a-vis employees, customers, anybody, the only question they ever asked, is it legal? 280 00:36:33.620 --> 00:36:45.780 And then they sent the lawyers to check out whether there is anything in the regulations that prohibited certain avenues of solving a problem. 281 00:36:45.780 --> 00:36:48.780 And if there wasn't, it was perfectly okay. 282 00:36:48.780 --> 00:36:59.700 The notion that they had moral responsibilities was completely wiped away by the fact that almost everything that people in business do 283 00:36:59.700 --> 00:37:10.580 has a regulatory provision written down someplace, either in a city, a county, a state, or a federal, or now even an international guidebook, you know? 284 00:37:10.580 --> 00:37:19.260 When you are that much regulated, you begin not to look upon yourself as having any personal responsibilities at all. 285 00:37:19.260 --> 00:37:28.420 And so it's not a big surprise, at least to those of us who find liberty as a vital element of human life, 286 00:37:28.420 --> 00:37:36.260 that this eventually leads to the demoralization of a society, that's at least, so I agree 287 00:37:36.260 --> 00:37:41.300 with you, only this has come to some of our attention a little bit earlier than Enron, 288 00:37:41.300 --> 00:37:47.220 and so when Enron happened we'd say, oh there we go again, you know, these guys just don't 289 00:37:47.220 --> 00:37:54.800 think in terms of they have a moral nature, they think in terms of they have to dodge 290 00:37:54.800 --> 00:38:23.800 I think one of the things that drove Mises to our death was that he was very suspicious of the notion that moral norms could just be imposed completely from the outside, from some purely objective source that didn't have any connection with the individual's desire to do something. 291 00:38:53.800 --> 00:39:00.440 that at least Rand thinks that she has made to this debate is that her rendition of objective 292 00:39:00.440 --> 00:39:03.520 is not synonymous with intrinsic. 293 00:39:03.520 --> 00:39:09.120 And it's the intrinsicist view that seems to allow, and I had this wonderful experience 294 00:39:09.120 --> 00:39:16.760 of interviewing Milton Friedman back in 1975, Ralph Reiko and I went to Chicago and interviewed 295 00:39:16.760 --> 00:39:22.840 him for Reason Magazine, and I asked him about whether he believes in anything like moral 296 00:39:22.840 --> 00:39:30.200 Right and Wrong, and he said, if you knew that another person is doing something wrong, 297 00:39:30.200 --> 00:39:33.640 you would have the moral obligation to stop it. 298 00:39:33.640 --> 00:39:38.680 And it doesn't mean violating rights, it means anything wrong, like using the wrong 299 00:39:38.680 --> 00:39:41.120 fork for crying out loud, you know? 300 00:39:41.120 --> 00:39:43.040 And why? 301 00:39:43.040 --> 00:39:49.920 Because he too held this notion that right is an intrinsic property, or goodness, and 302 00:39:49.920 --> 00:39:55.820 And then the obligation to pursue the goodness is some sort of an intrinsic property of things 303 00:39:55.820 --> 00:39:58.160 independently of any motivation. 304 00:39:58.160 --> 00:40:04.720 So the objectivity theory that Rand puts forth, which unfortunately I think a lot of people 305 00:40:04.720 --> 00:40:09.880 in the Austrian School are sort of alienated from because she had bad habits and everybody 306 00:40:09.880 --> 00:40:15.800 has bad habits and they then generalize that and say she's worthless like David Gordon 307 00:40:15.800 --> 00:40:22.760 with her books in this least recent list that he gave up just today on Mises.org 308 00:40:22.760 --> 00:40:30.320 that Rand's contribution to the philosophy of liberty is minimal or is 309 00:40:30.320 --> 00:40:34.400 wrong-headed but if they really looked at what she did one of the things that 310 00:40:34.400 --> 00:40:41.880 she secures is the notion that morality is worthless if it's coerced. Morality 311 00:40:41.880 --> 00:40:45.880 She ends, as she used to say, at the point of a gun. 312 00:40:45.880 --> 00:40:52.880 If you make people do these things, then forget about saying they're good people. 313 00:40:52.880 --> 00:40:55.880 Now, back to Mark's point. 314 00:40:55.880 --> 00:41:03.880 This debate between subjective versus objective may sound like a matter of labeling to some, like maybe even you. 315 00:41:03.880 --> 00:41:11.880 But, you know, that runs the risk of having things like coercive versus free being just a matter of labeling. 316 00:41:11.880 --> 00:41:22.880 So, most of the statists maintain that when they extort taxes from us, this is voluntary. 317 00:41:22.880 --> 00:41:25.880 Now, if you say, voluntary? You're nuts! 318 00:41:25.880 --> 00:41:31.880 They say, well, you know, you can label it coercive, we label it voluntary. 319 00:41:31.880 --> 00:41:38.480 So it's a matter of nominal definitions. Well what that does is throw the entire 320 00:41:38.480 --> 00:41:45.320 area of intellectual, intelligence, coherent, meaningful debate into a kind of 321 00:41:45.320 --> 00:41:51.440 a postmodernist, you can mean whatever the hell you want to mean and there is 322 00:41:51.440 --> 00:41:57.800 no coherent objective sense to any of the terms we use. The fact is that 323 00:41:57.800 --> 00:42:10.800 is that subjective in the literature has acquired the meaning up to the subject having nothing to do with any evidence or argument or reasons 324 00:42:10.800 --> 00:42:18.800 it's entirely up to the subject. Just like my preference for orange, I would consider a subjective preference. 325 00:42:18.800 --> 00:42:25.800 If somebody says, why do you like orange? Well, my mother and my father and my sister, none of that matters. 326 00:42:25.800 --> 00:42:32.200 period, end of story. If that's the way we think about ethics and political 327 00:42:32.200 --> 00:42:36.080 principles, we're cooked. 328 00:42:36.080 --> 00:42:53.080 Well, Seymour, it's not a semantic difference, it's a scientific difference in the sense of what do economists do, how far can they go, in their capacity as economists, that's where it stops. 329 00:42:53.080 --> 00:43:01.280 Well, that's what I'm saying when I read to you this line that whether you buy the coat or not is all that matters to the economist. 330 00:43:01.280 --> 00:43:05.840 It doesn't have to be subjective, objective, blue hair, you know, whatever. 331 00:43:05.840 --> 00:43:13.440 You bought the coat, millions of people buy the coat, that will have certain effects on the price of the coat, on the supply of the coat. 332 00:43:13.440 --> 00:43:19.280 There's no need to put subjective in there at all. This is all mumbo jumbo as far as I can see. 333 00:43:19.280 --> 00:43:29.280 There is one need to put it in, and that is because the number of coats any particular person will purchase depends on the marginal utility. 334 00:43:29.280 --> 00:43:36.280 So in other words, there has to be a foundation in subjective evaluations of the usefulness of the good. 335 00:43:36.280 --> 00:43:53.280 And the subjective evaluation changes in predictable ways with the supply that the individual possesses, the supply of the money that the individual possesses, so this is where the term subjectivism came into use. 336 00:43:53.280 --> 00:44:01.280 But do you think it really does any kind of a productive job other than saying, well, when you have enough coats, you don't want more? 337 00:44:01.280 --> 00:44:12.280 Well, for other reasons, because an argument was in the Austrian camp, it may have been better if the people followed Menger's research, who suggested personal instead of subjective, 338 00:44:12.280 --> 00:44:21.280 and I think Ido Holtzman has also suggested individual value versus social value over market price. 339 00:44:21.280 --> 00:44:34.280 Well, this means to be a mind-teasing exercise, so please, now that your mind has been teased somewhat, you can spend whatever time you subjectively prefer on this problem. 340 00:44:34.280 --> 00:44:36.280 Oh, Joe, you're almost tired of teasing. 341 00:44:36.280 --> 00:44:37.280 Thank you very much. 342 00:44:37.280 --> 00:44:39.280 Okay, thank you very much. 343 00:44:39.280 --> 00:44:40.280 Thanks a lot.