Sunday, January 31, 2016

Clarifying Jeff Jacoby's Misrepresentation of Ayn Rand's Position on Charity

Stuart K. Hayashi

I have long admired Jeff Jacoby of the Boston Globe as a scrupulous columnist; I have often recommended his columns, particularly his standing up for open immigration against the rest of the political Right.

Unfortunately, he has come out with a column on voluntary charity and philanthropy which grossly misrepresents Ayn Rand's view on this topic.  While many of the figures on American generosity are interesting, the inaccurate impression given of Rand taints this work.
For those raised to regard charitable giving as indispensable to meaningful lives and healthy societies, it can come as a jolt to discover not just that some people give little or nothing to charity, but that there are those who actually disparage charitable giving itself. In a 1964 interview, Ayn Rand said that her views on charity were “very simple: I do not consider it a major virtue and, above all, I do not consider it a moral duty.” John Steinbeck, whose political views were as far to the left as Rand’s were to the right, also disdained philanthropy. “Giving is a selfish pleasure, and in many cases is a downright destructive and evil thing,” he railed.

Rationalizations for not donating certainly aren’t hard to find.
One would glean from those paragraphs that Rand was one to "disparage charitable giving itself."

The quotation of Rand omitted additional sentences clarifying Rand's position.  Here is a more complete version of the exchange between Ayn Rand and the author Alvin Toffler (who would later go on to write many bestsellers of his own, such as Future Shock) for Playboy magazine:

Toffler: "Do you consider wealthy businessmen like the Fords and the Rockefellers immoral because they use their wealth to support charity?" 
Rand: "No. That is their privilege, if they want to. My views on charity are very simple. I do not consider it a major virtue and, above all, I do not consider it a moral duty. There is nothing wrong in helping other people, if and when they are worthy of the help and you can afford to help them. I regard charity as a marginal issue. What I am fighting is the idea that charity is a moral duty and a primary virtue." 
Toffler: "What is the place of compassion in your philosophical system?" 
 Rand: "I regard compassion as proper only toward those who are innocent victims, but not toward those who are morally guilty. If one feels compassion for the victims of a concentration camp, one cannot feel it for the torturers. If one does feel compassion for the torturers, it is an act of moral treason toward the victims."
Free-marketers often talk about how, prior to the New Deal, voluntary charity proliferated in the United States in the form of mutual-aid societies.  The idea was that many poor people (usually immigrants) would form organizations together. If one member of the mutual aid society fell on especially hard times, other members would help out that person.  You might be interested to learn that when she lived in California in her twenties, Ayn Rand was a member of a mutual aid society:  the Hollywood Studio Club, which was started by the YWCA.

People with only a straw-man understanding of Rand's philosophy might assume that the young Rand joining a mutual aid society was hypocrisy on her part. For those who recognize that Rand had no quibble with voluntary charity -- which she regarded not as a duty, but as benevolent generosity -- there is no conflict in the young Rand's actions on this matter with respect to her later writings.

Monday, January 25, 2016

Charles Murray's Disingenuous Denial About Advocating Restriction of Immigration Based on IQ or Race

Stuart K. Hayashi


With the late Richard J. Herrnstein, Charles Murray co-authored The Bell Curve.  To my astonishment, some of my fellow Objectivists have arbitrarily denied to me that the book provides a racist and eugenicist argument.  It takes some mental contortions for someone who has read the book to deny its eugenicism, but I can understand how such a rationalization can be made.  The book does not say outright, "Blacks and Hispanics are inferior."  However, the book offers several premises that it purports to prove through rather turgid figures and terminology.  Then, based on those premises, the reader is intended to deduce specific conclusions.  One who follows the deductive chain of reasoning can discern that the book's conclusion does advocate what is, in practice, governmental discrimination against specific people based on their race.  The deductive chain of reasoning is as follows.

1. IQ is genetically inheritable -- between 40 percent and 80 percent.
2. IQ is fixed and congenital -- environmental conditioning and choices cannot reliably change it over time.  [A pedantic reply is offered to the Flynn Effect.]
3. IQ is the main predictor of competency -- that is, people's successes or failures in life.  High IQ directly correlates with high economic productivity.  IQ is inversely proportional to criminality -- lower-IQ people are prone to violent criminality.
4. IQ tests show disparities in races.  Jews and Asians receive the highest IQ scores.  In the middle are most whites.  Lowest IQ scorers are, respectively, Hispanics and then Africans. [This is Stuart's paraphrasing of the book's arguments.]

If you follow the deductive chain of reasoning, what conclusion do the authors expect you, as the reader, to deduce?  The authors expect you to deduce that if blacks and Hispanics have low IQs, and if IQs are fixed over time, and if IQ numbers are congenital determinants of economic productivity or violent criminality, then:

5. The implicit, deductive conclusion of the book: blacks and Hispanics, in aggregate, are doomed to be less economically productive and more criminally violent than other ethnic groups. [This is Stuart's paraphrasing of the book's arguments.]

Then the book puts forth [my phrasing, not the book's]:

6. Immigration policy should be determined by IQ.  The authors recommend that the system of family visas be replaced with a system where those with higher IQs get into the USA more easily and those with lower IQs face more hurdles.  This is not a complete replacement, though, merely a re-orienting, orienting away from the family-visa system and orienting toward an IQ-number-based system. [This is Stuart's paraphrasing of the book's arguments.]

What is the deductive conclusion to draw from this?

7. If points 1, 2, 3, 4, and 6 are true -- if the authors recommend that lower-IQ people be impeded by Government Force from entering the USA, and blacks and Hispanics have lower IQs than other groups, then, in practice, implementation of the policy will necessarily result in an immigration system that becomes more implicitly discriminatory against black immigrants and Hispanic immigrants.  [This is Stuart's paraphrasing of the book's arguments.]

Concerning his protege Jason Richwine -- who makes similar rationalizations about IQ/Race Eugenics -- Charles Murray writes in National Review,

On Wednesday, the Washington Post revealed that Richwine’s 2009 Ph.D. dissertation at Harvard’s Kennedy School had said that, on average, Latinos have lower IQs than do non-Latino white Americans and the nation should consider incorporating IQ into immigration decisions. . . I had disagreements then and now about his policy recommendations, but not about the empirical accuracy of his research or the scholarly integrity of the interpretations with which I disagreed [emphasis added].

Really?  Richwine's policy recommendation, in Charles Murray's phrasing, is that "nations should consider incorporating IQ into immigration decisions."  If they incorporate IQ into those decisions, and if they believe "Latinos have lower IQs than do non-native Latino white Americans," the result will be an immigration policy that does even more to exclude Latino immigration.    Then Murray says, "I had disagreements then and now about his policy recommendations..." meaning Murray is saying he does not agree with an immigration policy that would block immigrants with supposedly lower IQs, which would, in practice, result in immigration policy being even more stubborn in blocking Latino immigration.


What do Charles Murray and Richard J. Herrnstein themselves say on this in The Bell Curve?  This is from page 549:

...we believe the main purpose of immigration law is to serve America's interests [America meaning Americans already in the USA; not those trying to get in --S.H.].  It should be among the goals of public policy to shift the flow of immigrants away from those admitted under the nepotistic rules (which broadly encourages the reunification of relatives) [these are family visas --S.H.]and toward those admitted under competency rules [meaning higher-IQ groups are favored and lower-IQ groups are disfavored; one who agrees with The Bell Curve about specific races being associated with low IQs would deduce that competency rules would, in practice, result in fewer members of specific races entering the USA --S.H.] -- not to the total exclusion of nepotistic and humanitarian criteria but a shift. [Emphasis added.]
The Bell Curve argues that IQ is what determines competency, and some races outrank others in terms of IQ -- meaning some races outrank others in terms of competency.  Insofar as Jason Richwine's Ph.D. dissertation concludes that IQ should be incorporated into the federal government's decisions on who enters the USA and who does not, The Bell Curve is making essentially the same policy recommendation.  Charles Murray's denial does not make sense.

Sunday, January 24, 2016

Thomas Sowell's Double Standard Regarding Mexican Workers and the 'Race to the Bottom' Argument

Stuart K. Hayashi


This is a re-post of a section a much longer post found here.


There is an argument against open immigration that doubles as an argument against free international trade.  First we hear that if we allow open immigration, that is bad because big companies will choose to hire Mexicans within U.S. borders; they will hire the Mexicans for low wages and leave native-born Americans without work.  Secondly, we hear that if we allow free international trade, that is bad because big companies will choose to hire Mexicans still in Mexico; they will hire the Mexicans for low wages and leave native-born Americans without work.  Both accusations stress that big companies will choose to hire Mexicans for low wages and leave native-born Americans without work; the only difference between the two allegations is that in one, the Mexicans are still in Mexico whereas, in the other, the Mexicans are in the USA.

Thomas Sowell shows a double standard here.  He says that in the case of free international trade, there is nothing to fear when it comes to the idea that big companies will hire Mexicans in Mexico for low wages.  In his book Basic Economics (see page 218 here), Sowell correctly states,

As for jobs, before the free-trade agreement was passed, there were dire predictions of a "giant sucking sound" as jobs would be sucked out of the United States to Mexico and other countries with lower wage rates after the free-trade agreement went into effect.  In reality, the number of [native-born] American jobs increased after the agreement and the unemployment rate in the United States fell over the next seven years from more than seven percent down to four percent, the lowest level seen in decades.  . . . What happens when a given country, in isolation, becomes more prosperous?  It tends to buy more because it has more to buy with.  And what happens when it buys more?  There are more jobs created for workers producing the additional goods and services.

That argument is correct.  But, bizarrely, Sowell seems not to notice that it is applicable when native-born Americans reduce their own costs by hiring Mexican immigrants (presently inside the USA!) for low wages.  He makes a frighteningly protectionist argument against allowing U.S. firms to hire Mexican immigrants for low wages:

How often have we heard that illegal immigrants "take jobs that Americans will not do"? What is missing in this argument is what is crucial in any economic argument: price.

Americans will not take many jobs at their current pay levels -- and those pay levels will not rise so long as poverty-stricken immigrants are willing to take those jobs.

If Mexican journalists were flooding into the United States and taking jobs as reporters and editors at half the pay being earned by American reporters and editors, maybe people in the media would understand why the argument about "taking jobs that Americans don't want" is such nonsense.

This is odd, because the same "cost savings" argument that Sowell used to defend the hiring of low-wage Mexicans in Mexico equally applies to the hiring of low-wage Mexicans in the USA.

First, let's observe how Sowell's own retort against hiring low-wage Mexicans in the USA can also be used against his defense of hiring low-wage Mexicans in Mexico.

How often have we heard that, thanks to the free-agreements that Sowell supports, Mexicans in Mexico and Indians in India "take jobs from Americans"?  What is missing from Sowell's argument is what is crucial in any economic argument: price.

Americans will not take many jobs at their current price levels -- and those pay levels will not rise as long as poverty-stricken Mexicans in Mexico are willing to take those jobs.

If U.S. firms were outsourcing information-technology jobs to Mexico and India, and those Mexicans and Indians were earning half the pay that would be expected by American information-technology workers, maybe economists would understand why it's nonsense to let U.S. firms outsource information-technology jobs abroad.

The same defense that Sowell provides to hiring low-wage Mexicans in Mexico applies to hiring low-wage Mexicans in the USA.

Sowell says this is the reason why it's OK if U.S. firms can hire Mexicans in Mexico for low wages, rather than giving those jobs to native-born Americans:  when those U.S. firms save money by hiring Mexicans in Mexico for low wages, they incur cost savings. It's not as if the U.S. firms will just sit on that money.  All money is spent in the long run:  either it is spent for immediate needs or it is saved for a future expenditure.  Those U.S. firms then use that cost savings to invest in new economic activities, or they spend it for immediate use.  Either form of expenditure produces demand for more goods and services.  The increase in demand for more goods and services sends a signal to would-be entrepreneurs that they will profit by supplying such goods and services.  These would-be entrepreneurs then hire native-born Americans.  True, when the USA and Mexico trade freely, this expands the market so that there is an increased supply of would-be employees.  But this is balanced out by a commensurate increase in demand for would-be employees.  That is why, everything else being equal, there is not an increase in unemployment.

Now observe how this argument applies to the labor market within U.S. borders.  When immigrants come to the USA and work for low wages, they increase the supply of available would-be employees.  However, these same immigrants must also consume goods and services.  Thus, the presence of these immigrants also increases consumer demand for goods and services.  And this increase in consumer demand signals to would-be entrepreneurs (native-born and immigrant alike) that they can profit by supplying such goods and services.  These would-be entrepreneurs then hire native-born Americans to assist them in that enterprise.

This is the reason why I say it's OK if U.S. firms can hire Mexicans in the USA for low wages, rather than giving those jobs to native-born Americans:  when those U.S. firms save money by hiring Mexicans in Mexico for low wages, they realize cost savings. It's not as if the U.S. firms will just sit on that money.

All money is spent in the long run:  either it is spent for immediate needs or it is saved for a future expenditure.  Those U.S. firms then use that cost savings to invest in new economic activities, or they spend it for immediate use.  Either form of expenditure produces demand for more goods and services.   The immigrant population earning the low wages also produce consumer demand for such goods and services. The increase in demand for more goods and services sends a signal to would-be entrepreneurs that they will profit by supplying such goods and services. These would-be entrepreneurs then hire native-born Americans.

True, when native-born Americans and illegal aliens trade freely, this expands the market so that there is an increased supply of would-be employees.  But this is balanced out by a commensurate increase in demand for would-be employees.  That is why, everything else being equal, there is not an increase in unemployment.

The same principle also applies to wages.  It explains why, when U.S. firms save money by hiring people for allegedly low wages, that does not necessarily bid down the average wage in the long run.


Friday, January 01, 2016

Ayn Rand Got Social Security? Welfare State As a Prison Manipulating You to Accept It

A common rationalization for the welfare state is that even Ayn Rand had to accept Social Security payments. This is intended to discredit her and all other critics of the welfare state. Indeed, I regularly attend a taxpayer-funded city library. I drive on government roads that taxes pay for. Upon retirement, I intend to collect Social(ist In)Security money. We are then told that if not for the welfare state, we critics of the welfare state would be starving, homeless, and naked. I am told that if we had a liberal republican Night Watchman State without taxpayer funding for social services, I would have no public library for reading and no roads to drive on.   Therefore, it is said, we free-marketers are ingrates.

That entire argument is based on a fallacy. The reason why we free-marketers use taxpayer-funded government services is that the welfare state has manipulated the system in such a way that privately funded alternatives (including private charity) become less readily available -- so much so that, to survive, we free-marketers resort to using the government monopolies.  It does not follow that if the welfare state were replaced with a liberal republican Night Watchman State, there would be no consensually-funded public library for me to attend.

Here I am in a YouTube video explaining this.




And by the way, Happy Stu Year! ^_^
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Clarification of what I said about Noam Chomsky's "libertarian socialism":  It is claimed that what Chomsky wants, in the long run, is a system of limited government, wherein people live on collectivist communes voluntarily, not forced to do so by the State.  In the present, though, Chomsky does advocate expansions of government power, including his praise for the graduated income tax.  I think Chomsky reconciles the two positions as Karl Marx did:  Like Marx, Chomsky would prefer that the State forcibly establish a collectivist lifestyle in which people selflessly toil for the collective community.  As Marx said, it is only after people become accustomed to this collectivist lifestyle that the State can be allowed to wither away.

Also, when I referred to the politician who was the godfather of William Ewart Gladstone, I mistakenly referred to the man as "Thomas Ewart."  The man's name was William Ewart -- William Ewart Gladstone was named after him.

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UPDATE from Tuesday, February 2, 2016: I am told that when people throw around that accusation about Ayn Rand, I should give them this link.

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UPDATE from Friday, February 6, 2016:

I have seen this cartoon circulating on Facebook.


That is intended to ridicule critics of socialism.  Let us examine its points.

Roads. Back in the early 1800s, the USA had an impressive system of roads whose construction and maintenance relied on consensual funding. These consensually funded tunrpikes extended thousands of miles and connected entire cities to one another, such as from Lancaster to Philadelphia and back. These roads were owned and constructed by merchants who wished to make their wares more accessible to customers from outside their neighborhoods. When you look at the books of the road companies alone, it appears the return on investment was only 2 percent. But when you look at the revenues and profits of the other businesses owned by the road companies' owners -- when you look at how much money they were making both before and after the roads were completed and in operation -- the return on investment is greater. What happened, though, is that these merchants wanted to rent-seek: if they could persuade the government to tax everyone to finance roads, that would reduce the costs of the merchants relying on roads. When taxes funded the construction and maintenance of roads, that disincentvized parties to build and maintain roads through consensual funding, as they would "pay double." That is the reason why roads were socialized in the USA.  It is not because there would be no roads if not for the State taxing people to finance their construction and maintenance.

Social(ist In)Security. If not for this system taking money out of our paychecks, we millennials could keep our own money to save for our own retirements.

Veterans' Administration (VA). Have the news headlines over the past three years shown you that the VA has made health care readily accessible for veterans?

GI Bill. That was one of the first programs where the government provided prospective students with capital for funding their higher education. And that's what actually created the present mess with higher education. The more the State helps pay for people's university educations, the more that drives up demand for higher education. That's why tuitions have gone up and millennials are burdened with student debt. And making university education "free" will not reduce those costs. The only way for tuition to go down in the long run is for demand to go down.

40-Hour Workweek. The reason why people enjoy a higher living standard today even as they have shorter working hours is that every input of one hour's worth of human labor has gained in productivity. That actually has to do with machinery and technology making economic production more efficient. For that, we have profit-driven inventors and profit-driven engineers to thank, not labor unions attempting to restrict the output of laborers.


UPDATE from Sunday, March 13, 2016:

Scott Hampton made this meme: