Ownership As Identification

The Institution of Rightful Ownership Identifies an Economic Value With Its Creator

Stuart K. Hayashi

Though it is not often phrased in this manner, there is an implication buried in economists’ conventional explanations for the origin of the concept of private property rights. The implication is that the main purpose of private property rights is to resolve disputes over competing claims over who should be able to control and consume which resources. This has much to do with the conventional proclamation by economists that the basis of economics in general and private property rights in particular is “scarcity.”



Private Property Rights Are Merely About Settling Disputes Over Control of Scarce Tangible Resources?
“Scarcity,” in this context, refers to the fact that, at any given moment, there is a specific total quantity of units of a good on the market. That there is this specific total quantity means that if, at this very moment, I gain and consume 50 units of this good, those are 50 fewer units available for anyone else at any given moment. My accessing and consuming more units at this moment means fewer units available for everyone else at this moment.

That principle applies even under all of the following three conditions.

1. More units of this good can easily be produced in the near future.
2. There is no danger of any long-term shortage of units of the good emerging.
3. My ravenous consumption of units correctly signals to producers of the units to produce even greater numbers of units in the near future. 

The number of units of the good available are on the supply side. Economists then conventionally continue that human wants are unlimited, and these wants are on the demand side. They thus come to two conclusions.

• Without establishing who privately owns what, a society lacking in recognition of property rights of any sort would devolve into chaos where everyone fights everyone else for “scarce” units of what they need. Insofar as people accept the institution of private ownership, that helps reduce the squabbling.
• The proper value and free-market price of a good are at the intersection of demand and supply, where vendor and buyer agree on how much of the buyer’s own wealth the buyer will give up in exchange for the good.

Both conclusions are mostly correct, but they are far from sufficient. Insofar as this dispute resolution was the major impetus for the origin of the concept of private property, that still leaves an important question unanswered. This “scarcity” might explain why life for everyone in general is more harmonious if different parties control different resources and units of goods. But this “scarcity” is not adequate to explain why it is that a specific party should control a particular resource or unit. In effect, most libertarians and economists conclude that your homestead should be privately owned by somebody, but few libertarians and economists care to elaborate on why it is you in particular who should own the very homestead that you settled.

Conventional economists are largely silent on this issue. Even economists who have reputations for defending laissez-faire enterprise have been lackluster on this. That is ironic. The issue of why a particular person is right to own and control a particular resource was touched upon by two founding fathers of the discipline, John Locke and Adam Smith, though they didn’t write essays that explored this idea to the point where they would take it to its logical conclusion. This essay you are reading is part of my attempt to expand upon the logic of their argument.




Private Property Rights Emerging to Protect a New Economic Value That Someone Has Created
Imagine you’re a homesteader. You go onto wilderness land that was not claimed by anyone. If you were a hunter-gatherer, you might be satisfied with this land in its default condition. But that hunter-gatherers mostly gained their food from foraging and hunting and otherwise did not change the land as much was a big reason why the infant mortality rate among them was 25 percent. As you want the chances for mortality to be much lower for yourself and the children you intend to bring into the world, you know that this wilderness is not satisfactory for your habitation.  For the land to be truly hospitable, you need to change it.

You choose which crops to plant. You irrigate the land so that the crops receive water with greater regularity. Although Karl Marx mischaracterizes this process as if it were manual labor and nothing else, the process actually involves the exercise of a body part other than the arms and shoulders: the brain. You improve the land and make it livable mostly through the plans you devise for it. And, as John Locke points out, the new livability of the land is economic value that was not inherent to the land.

 No, the net increase in the land’s economic value was something that your creative choices had put into it. It is for this reason, note John Locke and Adam Smith, that the homestead has rightfully become yours. As Locke and Smith laid the foundation for this interpretation, I call it the Locke-Smith (“Locksmith”) Theory. When other people come and homestead their own plots, it is proper that they respect that your own plot is rightfully yours to control exclusively.




The Interpretation That Private Property Rights Are Just About Ending Intra-Community Disputes;
or: “I Don’t Care Who Started It!”
Throughout history, many societies have considered any conflict between neighbors to be inherently bad. These societies are unable to cope with intra-neighborhood conflict. Their intolerance of intra-community conflict goes to the point that they would rather there be an unjust resolution to the conflict than for the squabble to go on longer. That applies even if the intra-community conflict extending for a much longer period of time would increase the likelihood of a just resolution. That is, a speedy end to conflict has priority over the attainment of justice.

Here is an example you might have witnessed. Two children begin fighting. An adult authority figure steps between them and breaks it up. One child points to the other and yells, “He started it!” Then the adult authority figure immediately snaps, “I don’t care who started it!” Speaking personally, this attitude seems common among my fellow persons of Japanese descent who reside in Hawaii. Ever since childhood, when I have stood up for myself verbally, some elderly person would say, “Quiet! Nobody cares if you were right or not earlier. We’d rather you just shut up and spare us all this noise!”

Yet when justice is prioritized above conflict resolution, it necessarily matters who started it. If you immediately come upon a woman stabbing a man with a knife, the context that led to this outcome certainly matters. It may be the case that the man started it — he was trying to rape this woman, and she stabbed him in self-defense. On the other hand, it may be the case that this man did nothing to her other than write her into his will. Maybe she had planned to stab him, dispose of the body in secret, and have him declared legally dead after a period of his having been reported missing. It would be for the purpose of inheriting his fortune. In that case, she would be the one who “started” it. In criminal justice, who “started it” is the difference between assault and self-defense.

If a woman stabs a male assailant in self-defense, I don’t think there would be much controversy over who is morally in the right. We do find that there is a lot of controversy over who is right in disputes over private property.

Let us return to the scenario where you have improved a plot of land and therefore gained legal ownership over it. I have contributed nothing to your improvement over the land. But once I see the improvements you have made on it, I decide that that is where I need to stay. I try to squat on your land. You accuse me of trespassing and call the police on me. I then proclaim that you are a greedy overlord trying to deprive me of the amenities I need and therefore deserve. You and I go to court to settle this.

Throughout most Western and even central Asian history, most courts would side with you. But it would not necessarily be because these courts concede that moral right and righteousness are on your side. As I have written before, throughout most of history it was that most societies regarded your private control over your land as nothing better than as a stewardship tentatively assigned to you by society-as-a-whole or by the gods and wilderness spirits.

Pertinent to this discussion, it was not until the arrival of Enlightenment philosophers such as Locke that intellectuals began to recognize that the economic value of your land did not come primarily from the land’s default state or from the gods. It was not until Enlightenment philosophers such as Locke that intellectuals began to consider that the economic value of your land comes from your choices in what to do with the land. It was when people began to entertain the realization that economic value and wealth are created by such intellectual and entrepreneurial effort.

But, generally, the courts would side with you for a different reason: they see the precedent of previously-established private ownership as the easiest, quickest, and most convenient method for settling the dispute. The courts ruling in favor of the private property holder is indeed the morally just ruling. But very few people, even judges who rule on the side of the property holder, understand that. In the scenario where the courts must settle the dispute between you, the homesteader, and me, the trespassing squatter, the courts come down on the side of right largely by accident. In many instances where people side with the property holder, they do so grudgingly.

To the degree that most people are more sympathetic to the property holder than the trespasser, it has less to do with the fact that the property holder earned her property, and more to do with the property holder being seen as more predictable and reliable — and therefore less dangerous to the community. Conversely, the trespasser is regarded as inherently more disruptive and therefore likelier to instigate future intra-neighborhood conflict. Again, the very emergence of strife is considered worse than any injustice that might be inflicted within the squabble or in attempt to end it.

For instance, the same Garrett Hardin who coined the tragedy of the commons writes in the journal Science that the most effective route for settling disputes over who gets what resources is “the institution of private property coupled with legal inheritance.” Immediately upon saying that, Hardin qualifies that, like many other people, he believes that the court coming down on the side of you, the property holder, is the lesser evil, the greater evil being any continuation of our squabble. Hardin goes on,

We must admit that our legal system of private property plus inheritance is unjust — but we put up with it because we are not convinced, at the moment, that anyone has invented a better system. The alternative...is too horrifying to contemplate. Injustice is preferable to total ruin.

That is the attitude of most people in the West, including alleged defenders of laissez-faire capitalism such as Thomas Sowell. The notion is that for a society to put up with the institution of capitalist private property is rather crass and cynical, but humans are too grubby and “fallen” to be able to manage something of higher aims, such as socialism. That is why Sowell says,

If everyone were sweetness and light, socialism would be the way to go. . . . Maybe some day we will discover creatures in some other galaxy who can operate a whole society that way. But the history of human beings shows that a nation with millions of people cannot operate like one big family. . . . 

While my desires for a better life for ordinary people have not changed from the days of my youthful Marxism, experience has taught the bitter lesson that the way to get there is the opposite of what I once thought.

This notion that the institution of private property is nothing better than a begrudging recourse for resolving disputes over the distribution of resources is also found in the arguments of many libertarians.

 That is visible when libertarians argue that all resources that can be privately owned, such as forests and even rivers, should be.  Their main rationale for this privatization that the differing incentives between private profiteers versus tax-funded government employees often result in the privately owned resources being better-conserved and better-managed. Libertarians who advance that argument are not wrong on that point. Still, when that is presented as the main argument for private property, it overlooks the implicit role played by private property that is of far greater psychological significance.

Libertarian attorney Timothy Sandefur exemplifies that approach. Consistent with that approach, he writes that legitimate private property, in contrast to the concept of intellectual property that he tries to discredit, “is naturally exclusive, meaning that if I have it, you simply *cannot*; if I take it, you no longer have it — you have been ‘disseised.’”

Sandefur presents private property as, more than anything, that form of dispute resolution, and simultaneously fails to address who exactly should be recognized by the law as the default owner of a newly created economic value.




Rightful Ownership As Identification
Ayn Rand said, “Existence is Identity, Consciousness is Identification.” That has a two-part meaning. First is that every entity that exists has its own identity, its own specific nature. That means that insofar as an entity can be distinguished as such, it possesses traits that make it stand out from other entities. “Consciousness is Identification” refers to how it is by use of your reasoning mind that you discern the attributes distinguish one entity from others. To translate, an entity has its own identity and it is through your rational faculty that you gain knowledge of its identity. To gain knowledge of something’s identity is to identify it. That is the identification. And an important application of this faculty for identification of anything is the identification of a piece of property with its owner.

Here we find that the notions about private property that I have described above — property as a tentative method for dispute resolution — is, at best, woefully incomplete. To identify a property with its owner is about so much more than identifying who currently has the legal authority to control which resources. We return to the previously imagined scenario of a dispute concerning you, the homesteader, versus me, the trespassing squatter.

Here, to identify the property owner is about so much more than identifying which of the disputing parties is the safer, more reliable party who is less prone to initiate social discord. Nay. To a large extent, to identify a form of wealth with its rightful owner is to identify that wealth with the party that created it. That is a fundamental distinction.

Many judges would say that they rule in your favor because that is just the law. For them, that is the end of it. At least, for them that is the most direct and substantial reason why it is you who should have ownership control over your homestead. It is on account of official legal documents saying so. Judges who are more philosophically inclined, but who tend to be molded by the conventional philosophic consensus, may cite, as their reason for siding with the property holder, that it is the tradition that accords with the big priority that is ending conflicts per se.

In court, we establish that I am the one who trespassed on the plot that you improved. You point out that you were rightfully minding your own business, whereas I took the initiative to intrude upon your life. We get into a fight. Here, “I don’t care who started it!” is the perfect retort from a judge who believes that private property rights are merely about settling disputes over scarce tangible resources. Such a person sure doesn’t care that the economic value over which we are fighting is a value that was started by you and your choices.

The most direct and substantial reason why you are the one who should have ownership control over the economic value of your homestead is that you are the one who created that economic value. The law’s formal observance of you as the homestead’s owner is no more than secondary to that fact. And the law’s formal recognition of you as the owner is merely the law acknowledging, always implicitly though seldom explicitly, that the party that should have default claim of ownership control over an economic value is the one that made it.

Ownership is the means of identifying an economic value with its creator. This identification is what helps the law ensure that, in controlling and enjoying the economic value she took the initiative in producing, a person experiences the logical consequences of her peaceful chosen actions. That identification helps prevent thieves from wrestling away control of the effect (the economic value) from its cause (the value’s creator). This especially applies to intellectual property rights.



If an Economic Value Belongs to Its Creator, How Can I Rightfully Own Units Made By Someone Else?
This principle is not mitigated by the fact that a particular unit’s rightful owner is seldom the same party that produced the unit directly. In most instances where someone resolutely trades away the units she produced directly, she maintains the economic value she had created in the direct production of the units. The economic value she previously had in those units is what she now has stored in whatever good or service she obtained in exchange for the units. Indeed, insofar as this party first produced those units with the intention of trading them away later, she did so for the purpose of maintaining the units’ economic value in the form of good or service she gained in exchange for the units.

When you improve your land, the improvements are what you have produced directly. But when you sell the land for $500,000, you retain the economic value of the improvements. The economic value you produced is now stored in the $500,000. When you exchange the $500,000 for Y, the Y itself was assembled directly by other parties, but the economic value you produced is now in the Y.

Due to natural circumstances, that economic value might depreciate on its own. Machinery can wear down. Food items will rot. The depreciation can also be imposed from government forces, such as in the national government’s treasury and the central bank devaluing the monetary units you saved up. But if the material units you produced directly were traded away for Y, whatever economic value remains with Y is the same economic value created from your production of the original material units.

There is a corollary to this. Note that an extension of the right of the homesteader to the land he improved is his right to sell that land. Thus, the homesteader’s right to the land he improved is applied in the homesteader’s ability to transfer ownership of it to someone else. That does not change the fact that, by default, the first rightful claim of ownership over improved land goes to the homesteader whose planning choices improved it.

That principle applies to manual labor. An extension of the Locke-Smith Principle is the laborer’s right to transfer ownership of his labor. For that reason, it is consistent with the worker’s rights that the worker may forge an agreement with an employer. The worker implicitly agrees that, in exchange for the employer’s remuneration, the employer gains ownership over the product of the worker’s physical labor as that labor is being performed. That does not change the principle that, by default, the first rightful claim of ownership over one’s efforts goes to the person who is performing that effort.



The Right to Ownership Over the Economic Value One Has Created Includes the Right to Bestow It to Heirs of One’s Choosing
Many readers balk at this idea, saying that most of the wealth a person has was not created by she herself, but was what she inherited from elder relatives. They say that especially applies in instances of the heiresses of multi-million-dollar fortunes. The consideration that a lot of people start with inheritances, reply my detractors, demonstrates that most of the economic value a person possesses is not what she created herself.

 More specifically, the proclamation goes that the $300 million that Paris Hilton inherited cannot be the result of her own creative choices. No, goes the proclamation, she is known for being a flaky socialite who made no wise investment other than having been born to the most convenient set of parents. As Garrett Hardin says it,

An idiot can inherit millions, and a trust fund can keep his estate intact. We must admit that our legal system of private property plus inheritance is unjust — but we put up with it because we are not convinced, at the moment, that anyone has invented a better system.

I have refuted that argument in this other post.

I cannot deny that most of us alive today, rich and poor alike, work with economic value that was already created by our forebears. But, as I have written in months past, that reality does not nullify the principle. The fact is that insofar as you are free, the economic value you own and control is still the result of your own productive choices. And that fact does not hinge upon your fortune having been built up from nothing, ex nihilo.

As I have noted in this other blog post, to say that Paris Hilton inheriting $300 million is a reward to her for doing nothing, or for merely having been born, is to overlook something crucial. The member of the Hilton family most germane to this discussion is Paris’s great grandfather, Conrad Hilton, founder of Hilton Hotels. The hundreds of millions of dollars he accumulated were the sum total of what his hotel guests willingly paid him in exchange for his lodging services. And these guests chosen to pay him these prices because they valued the lodging services more than the monetary sums they gave up.

 One of the great motivators of earning lots of money is spending it on oneself in one’s own lifetime, but another is being able to bequeath it to descendants. Paris Hilton’s inheritance is not an instance of some malevolent deity, named Capitalist Inequality, rewarding her for having been born to convenient parents. Nay, her inheritance is the reward to Conrad Hilton from his guests for the services he provided them.

Many people reply indignantly that even if they can sympathize with Conrad Hilton wanting to ensure a comfortable life for his great-grandchildren, it still offends them that flaky heirs and heiresses can frolic in an affluence that the heirs and heiresses themselves take for granted. The reality is that insofar as there is economic freedom, heirs and heiresses hold onto their wealth to the extent that they still exercise responsibility and even productiveness in managing their heritage. Through unwise choices, an heir or heiress truly unworthy of such a fortune will happen to lose it.

At age five, Woolworth department store heiress Barbara Hutton inherited $70 million — $1.372 billion in 2018 U.S. dollars. Not only did she not appreciate her fortune; she did not even appreciate fortune-makers, writing hate poems about how capitalism is venal and corrupting. She did not manage her fortune with much self-care. When she died, she had no more than $3,500 left. Her story is unusual only in its severity — accounts of shrinkage of the fortunes of multimillionaire heirs are less extreme but nonetheless common. When “Commodore” Cornelius Vanderbilt died in 1877, he left behind an estate of $100 million. When his descendants held an official reunion at Vanderbilt University in 1973, not one of them possessed a net worth even as high as $1 million.

Paris Hilton inheriting $300 million does not negate my point that, insofar as people deal peacefully with one another, in the long run a person’s wealth is the stored version of the economic value which that person created. Paris inheriting $300 million is, in principle, about Conrad Hilton having created the 300-million-dollar value and rightfully deciding what to do with it. How much of that wealth Paris will continue to retain in her old age will depend upon her own wisdom in managing and re-investment of this economic value.

Thus, indeed, insofar as anyone acquired it through choices made in freedom and peace, the amount of wealth that someone owns, inherited or otherwise, is the quantity of economic value that he or she created through her choices. And these choices are an important portion of one’s identity. Concordantly, identifying someone’s ownership over wealth that is the result of such choices is a method of identifying important aspects of the owner herself.





Conclusion: Your Economically Productive Choices As Part of Your Identity, As All Your Choices Are
Yes, your private ownership over the economic value you created identifies you with the creative actions you chose to bring that economic value into existence. As I have written earlier, I find so much of “Identity Politics” to be tragic. I feel sorry for political activists talking about one’s race, sex, gender, sexual orientation, or another trait with which someone was born beyond her control, as if those unchosen traits are the main ones that provide someone with an identity. Someone’s identity is most specifically at the individual level. Identity is most specifically that which distinguishes a single person from everyone else, including from many other people that have superficially similar qualities.

My ethnic origin hardly identifies me in separation from the 1.4 million other Americans of Japanese ancestry. It definitely does not identify me among the 130 million other people of Japanese descent. Were it that my identity could be no more specific than my ethnicity, that would hardly narrow it down. And that is just fine for many political activists who try to exalt the social collective over the individual. In the end, what actually identifies me from everyone else is what renders me unique. What makes me unique is the sum total of choices I have made throughout my life.

Point to any one innocuous, whimsical decision I made in my life — such as eating a hamburger at McDonald’s today — and that same choice was probably made by millions or even billions of other people. However, the choices add up over a lifetime. Looking at the entire series of choices a single person has made over his or her lifetime, it is not exactly like anyone else’s series of lifetime choices. To reclaim a noble term that internet trolls have tried to make into a slur, the identity that comes from the sum of your lifetime choices is of a uniqueness comparable to a snowflake.

Many of the more general, more superficial — literally surface-level — aspects of someone’s identity are outside of his or her control, such as the aforementioned ethnic origin or sex-related traits. But the most substantial and specific attributes that distinguish someone are the choices in his or her control. Hence, those choices are the most substantial source of one’s identity, and, well into adulthood, your identity ultimately consists of the results of the choices pertaining to what you have made of it. As noted by Amazon founder Jeff Bezos, “We are our choices.”

And among the choices that make up our identity are those pertaining to finance and economics. I hold no doubt that many people recoil at such a thought. It is a common refrain, “I hate people being materialistic and trying to wrap up their identity in what they own. If the bank forecloses me and I lose my stuff, it doesn’t erase my personality; I don’t stop being who I was before the foreclosure.”

 I readily acknowledge that you are not the belongings that are external to you. You have an identity separate from such objects. Were you to lose a significant portion of your fortune from some unforeseen traumatic event, that loss of money, by itself, would not stop you from being you. Still, the steps you chose to take to acquire anything with which you were not already born do display facets of your personality and are thus part of your identity.

As an institution that is supposed to be helpful in safeguarding you against theft, a document of rightful ownership is a document of identification. It is an identification in several important respects. The deed to your homestead, for instance, is such a document for identification. Consistent with what I have been saying, the deed identifies you with the property you control because it identifies the economic value with its creator.

This is something that cannot be stressed enough. Your identity consists of your creative choices. Your creative choices produce economic value. When the economic value you produce is respected as your private property, that ownership identifies the economic value with its creator. That is, respectively, to identify the effect with its cause. Rightful ownership is thus a form of identification. For someone to steal the economic value you produced is for that person to steal the logical effects of your choices, choices that are part of your identity. On a broad level, all theft is a sort of identity theft.

Are There Forms of Economic Value That Exist As a Default in the Pristine Wilderness, Before Human Entrepreneurship Was Applied to It?

And Might Human Entrepreneurship Ruin This Economic Value Found in the Wild?


Stuart K. Hayashi





I have argued that, since the times of the hunter-gatherer, poverty has been the default for human beings. Most economic value existing today was created by human initiative, where entrepreneurial innovators have devised new methods of producing greater quantities of economic value from ever-fewer and ever-smaller inputs of natural resources.

But I think some people might reply that there are forms of economic value that existed prior to any human initiative, and that entrepreneurial value-creation might have been of detriment to these natural and preexisting forms of wealth. As an example, hunter-gatherers had fresh, breathable air. Throughout the 1800s, industrialization produced many forms of wealth that hunter-gatherers did not possess, but this industrialization infested the atmosphere with toxic smoke. Does a point such as that negate my argument overall?

I concede there are some instances of some natural resources already possessing economic value as a default. Breathable air is taken for granted until particular industrial activities cause pollution that render safely breathable air a scarcity. Although environmental regulations that governments imposed, from the top-down, are inaccurately credited as the main reason for improvements in air quality since the 1970s, much of the improvement is due to market-based factor.

One is the recognition that the breathable air in one’s vicinity is one’s private property, and therefore people whose air is polluted can rightfully sue neighboring air-polluting firms. These air-polluting firms were trying to cut their own costs by declining to make proper and safe disposal of the waste byproducts that went up their smokestacks. This hurt the air-polluting firms’ neighbors. In their civil suits, the neighbors transfer those costs back to the firms.

Hence, air pollution is not the result of laissez faire as much as it is an attempt by firms to socialize and collectivize their own costs. Those costs being transferred back to these firms, by means of the air being recognized as others’ private property that should not be damaged, is the solution. And it is a specifically capitalist solution. Insofar as people are free and peaceful, an entrepreneur cannot forcibly impose her own costs onto other people as an air-polluting firm would.

Every input of natural resources and human labor imposes a cost on the entrepreneur. The entrepreneur therefore downsizes her costs and upsizes her profits insofar as she can devise methods of producing greater economic value from ever-smaller and ever-fewer inputs of natural resources and human labor. Air pollution comes from the waste byproducts of this process. To cut down on this waste is to cut costs. Hence, entrepreneurs who did the most to reduce waste in the inputs of natural resources were, per unit produced, also the ones who cut costs by the widest margins.

Breathable air that can be damaged by some forms of industrialization may be an example of an economic value that already existed in the wilderness as a default. For the most part, though, most economic value comes from market participants applying scientific knowledge to convert objects from the wilderness into an environment more suited to human habitation. Overall, my point still stands. For hunter-gatherers, the infant mortality rate is 25 percent. In the West, it was political-economic liberalization and industrialization that got that figure below 1 percent.

On a net balance, most wealth comes from entrepreneurial development of technology, not from hunter-gatherers simply accommodating themselves to the wilderness in its default condition.

Ludwig von Mises’s Explanation on How Price Changes Contain Information Signaling Shifts in Supply and Demand

Stuart K. Hayashi

Ludwig von Mises; image from
Wikimedia
Commons, which came
from the Ludwig von
Mises
Institute; licensing
permissions informa-
tion here

Many libertarian anarchists, such as those of the Ludwig von Mises Institute, denigrate the institutions of intellectual property (IP) and intellectual property rights (IPRs). This is ironic, as IPRs are important for sending information throughout the economy to the market’s participants. This is similar, in principle, to an idea put forth by that anarchist institute’s own namesake, the economist and non-anarchist Ludwig von Mises.

Mises provided a helpful explanation for how observed changes in commodities’ prices were forms of information that sent signals to would-be vendors on which commodities would need more or less supplying to consumers. Mises also explained how efforts by governments, from the top down, to mandate maximums or minimums on prices would ultimately provide misleading and inaccurate information to the would-be vendors.  The misleading signals sent by governmental price controls thus imposed shortages in some parts of the economy and wastefulness toward resources in others parts. Those shortages and waste would have been more easily avoided if not for the government’s attempt to control prices. The explanation is something as follows.

If the average price of a unit of a good — say, a widget — increases, that indicates, to those watching the market, at least one of two possibilities. The first is that there has been an increase in marketplace demand for the widget. That would mean that people are more willing or more able to trade greater amounts of their wealth for the good than they were before. The second possibility is that there was a reduction in the supply of widgets. That would mean that fewer units of the good are being placed on the market. That could be because there has been a reduction in vendors of this product. It may also be because some increasing cost in the process of placing widgets on the market has made fewer widgets available.

In any case, the price increase transmits to would-be vendors the signal that there is a greater profitability in the supplying of widgets to the market than there was before. This motivates more would-be widget vendors to place additional widgets on the market. That brings the price back down.

Conversely, if there is a reduction in the average price for units of widgets, it suggests the opposite possibilities. It could be that there is a reduction in marketplace demand for widgets. That would mean fewer people are that willing or able to give up portions of their wealth in exchange for widgets. It could also be that there has been an increase in the supply of units of widgets. That would result in would-be widget customers having to compete less fiercely with one another to get every last widget they want. They are no longer bidding the price as high as they were previously. In any case, the decrease in the likelihood of making a big profit from supplying widgets is what signals to would-be widget vendors that this market is saturated. It suggests to them that bigger profits are to be made in supplying units of some other good that is scarcer.

That is why Mises concludes that price changes are important signals transmitted throughout the market to guide participants, informing them of when marketplace demand has increased or when a much-desired good is becoming scarcer and needs to be replenished in stock. And he adds that the freer the market is — meaning the more peacefully that participants interact with one another — the more reliable is the information encased in the price changes. Mises explains that controls in price that governments impose from the top down have the effect of sending misleading information to market participants. Market participants being misled in this manner impedes upon their ability to make well-informed decisions they otherwise would execute.

Suppose you have a store that sells widgets. Due to a shortage of supplies in the natural resources that go into producing widgets, you have had to increase the price of units from $10 to $70 per unit. In an unfettered market this would signal to widget manufacturers that to win back customers, they might need to find some new and cheaper type of resource to produce widgets. But with the new scarcity in widgets, customers know they have to conserve. They must be sparing in their purchases of widgets and sparing in their usage of these units. Now every Sunday, a new shipment comes in of seven widgets, which you charge at $70 apiece. Also every Sunday, I come in and purchase one unit for $70. Previously I would have purchased more than one unit. In fact, every day of the week, a specific customer — corresponding to that day of the week — comes in and purchases one unit for $70.

But suppose the government decrees that the price increase is unfair. The government says that because customers were accustomed to the old price, there should be statutes officiating that the price cannot exceed that. When I enter your store on Sunday, and see the price is back down to $10, the signal that I was to be sparing and conservative has disappeared. I purchase all seven units for the week. Then each day from Monday to Saturday, a customer comes in and finds there is nothing for him or her.

The government-mandated price controls feed misleading information to market participants, upon which they act. That is why, when governments set a maximum price for a product that is far lower than the free-market price, that results in shortages. It is also why, when governments set a minimum price for a product that greatly exceeds its free-market price, the consequence is a surplus of units that would-be vendors cannot unload.

Yes, price changes transmit necessary information to market participants. That is why it is fitting that the ancient messenger god Hermes/Mercury is also associated with commerce. Acts of commerce not only rely on information but transmit it.

What I have written above about price changes is very basic economics-related knowledge to the libertarian anarchists and libertarian economists who seek to downplay the need for IP protection. But these alleged free-marketers have been overlooking an even more basic type of information in the market.  More than that, the far-more-basic information these alleged free-marketers overlook is information that serves as the foundation enabling customers to find vendors and negotiate free-market prices in the first place.  That is a matter I try to explain over here.

Freedom Wants to Be Global

Stuart K. Hayashi



MAGA nationalists throughout white-majority countries have shouted, Admit you can have freedom while borders are permanently closed to economic migrants from the Third World!

There is actually an internal contradiction in their vague notion that freedom originates from the very confines of national borders.

To be free is to be able to do anything possible to you and peaceful without being threatened with violently-enforced constraints, such as those from government. For your peaceful actions to be free of constraint from government is, necessarily, for them to be free of constraint from governments’ geographic borders.

Nationalists would have you believe that the source of freedom from violently-enforced constraints is . . . borders that are violently-enforced constraints.

For the government to put you under lockdown is for it to draw a crude ring around you and say, “You’re free to do what you want with your own belongings — up until the edge of our crudely drawn ring. If you accept other people’s invitations to step foot on their private land holdings, and those holdings are outside the ring we drew, we’re right to use force against you.” That makes as much sense as putting you under house arrest and saying, “You have freedom because you’re still free to do what you want in your own house . . . up until you attempt to step outside peacefully.”

But that is what nationalistic restriction of immigration happens to be — except nationalism is a sort of quarantine that’s intended to be permanent.

And insofar as they cite, as the basis for this long-term quarantine, the “cultural incompatibility” of some peaceful people with others, what the nationalists fear is not that you will infect others with some physically damaging pathogen, but with your ideas.

Stewart Brand famously said something that is seldom completely understood by those who quote it enthusiastically: “Information wants to be free.” I want to borrow a bit from that. More than I am of what Brand said, I am certain of this: freedom wants to be global.

Symbols vs. Illusions vs. Lies

Stuart K. Hayashi


Symbols, illusions, and lies have something in common — they are not Q literally (Q being something in reality) but they are somehow taken, rightly or wrongly, as some mental representation of Q.

1. A symbol represents Q in your mind, but your mind does not respond to it as if it’s literally Q.
2. An illusion — a mirage, magic trick, or artistic depiction — might represent Q in your mind, and your mind might respond to it as if it’s literally Q when your mind should not.
3. A successful lie represents Q in your mind when it should not, and the liar would have it that your mind respond to it as if it’s literally Q.

Sorry, Sargon: Stefan Molyneux Has in Recent Years Continued to Pressure His Fans to Disown Their Loved Ones

Stuart K. Hayashi





Lately I have blogged about a foolish video apologia for white-nationalist cult leader Stefan Molyneux on the part of right-wing YouTube vlogger Carl “Sargon of Akkad” Benjamin. Molyneux put out a tweet dishonestly denying that he has advocated eugenics and white nationalism. Sargon approvingly cited the tweet and took it at face value, as if it were proof that there was nothing to those accusations. You can actually see montages on YouTube that show that Molyneux indeed has a record of promoting eugenics and whitewashing white nationalism. Molyneux has gone as far as saying that “freedom has a eugenics component to it inevitably.” You can see those montages and my blogging about them over here.

Although the denial of Molyneux’s eugenicism and white nationalism was the main topic of Sargon’s video, Sargon did touch on something else that warrants concern. Sargon disapprovingly read out loud a tweet pointing out Molyneux’s long record of pressuring his followers to disown their siblings, parents, and close friends merely for disagreeing with Molyneux’s ideological advocacy. Molyneux was especially known for this practice between 2006 and 2014; we have not heard as much about it since then. Dismissing the tweet about Molyneux’s treatment of his followers, Sargon pronounces, “I think those accusations are probably somewhat overstated, aren’t they? And this, I think, is something that happened a long time ago. And I think it would be fair if we were to ask him his positions on these times now.”

Someone would come away from that statement of Sargon’s with the impression that Molyneux’s practice of dividing families is something that is long past. As I have blogged before, urging his fans to disown their parents and longtime friends over disagreements with him is something that Molyneux has done publicly at least twice since 2017. As of this writing, Molyneux has not shown any contrition over what he has done.

Below are three different cuts of the same montage of Molyneux performing this manipulation in recent years.

There is one cut that is two minutes long and can therefore be embedded in a tweet. Editing it down that short meant cutting out parts of Molyneux’s sentences, though. For the complete sentences, you can watch the 20-minute cut. If you watch the longest cut, you must have some patience for Molyneux’s many ramblings tangents.

15-minute cut

20-minute cut (less of Molyneux’s tangents have been cut out)

2-minute minute that can fit in a tweet (a lot of editing, with some interjections edited out of the sentences; for the complete sentences, watch and hear the 20-minute version)

See also: In November of 2019, Molyneux did an entire video falsely denying he ever said, and meant in a biological context, that not all human beings are the same species. For a montage disproving Molyneux’s denial (which, again, comes in a two-minute cut and a longer cut), go here.

Sorry, Sargon: Your Pal, Stefan Molyneux, Does Promote Eugenics and White Nationalism

Stuart K. Hayashi

4-minute, 44-second cut

6-minutes, 39-second cut

2-minute cut, which can be embedded in a tweet

Last month, the quasi-nationalist YouTube vlogger “Sargon of Akkad” (Carl Benjamin) did a video for his sister channel, Akkad Daily, where he launched a defense of white nationalist cult leader Stefan Molyneux, whose podcast he once did an interview for. Because Molyneux used the MailChimp marketing software for sending out his white nationalist e-mail newsletter, Nandini Jammi, cofounder of the activist campaign Sleeping Giants, alerted the MailChimp company of the uses to which Molyneux was putting its platform. Not wanting its brand associated with the white nationalism, MailChimp ceased providing service to Molyneux. In protest against MailChimp’s decision, Sargon denied in his video that Molyneux had done anything wrong at all, proclaiming, “...I do not agree that Stefan Molyneux is even a white nationalist.”

Early in the Akkad Daily, video, Sargon shows this tweet where Molyneux delivers what anyone who has been following his career for the past five years will be able to spot as obvious lies. Molneux’s tweet pronounces,

1. I oppose eugenics as an egregious State violation of the non-aggression principle.
2. I have interviewed 17 leading scientists on human intelligence - including leftists: http://www.fdrurl.com/IQ
3. I am not a “white nationalist”

1. I oppose eugenics as an egregious State violation of the non-aggression principle.

2. I have interviewed 17 leading scientists on human intelligence - including leftists: https://t.co/OaUVYOXaYW

3. I am not a “white nationalist”

4. What is wrong with “men’s rights”? https://t.co/KSIRaiP0qO

— Stefan Molyneux (@StefanMolyneux) January 14, 2020

Point 2 of Molneux’s is dubious. The link in his tweet is one that goes to a playlist of seventeen videos, but two of the videos are with the same interviewee (Kevin Beaver), which means “17 scientists” is not even the correct numeric figure.  Before sending out the tweet, Molyneux did not even bother to count the people on his own list.  One of them, Nicholas Wade, is not a Ph.D. scientist but a well-known science writer whose education goes no farther than a bachelor’s degree in natural science.

Moreover, two of the interviewees — James Flynn and Eric Turkheimer — contradict Molneux’s claims and have, subsequent to those interviews, identified Molneux’s claims as charlatanism. The main interviewee listed whom Molyneux cites in his claims about race and IQ is Charles Murray, and Eric Turkheimer directly contradicts him here and here, strongly implying that the very same talking points of Charles Murray repeated by Molyneux are racist. With respect to James Flynn, following his interview with Molyneux, he directly called Molyneux a hack and a waste of time: “I wouldn’t think of going within a mile of him if he talked. These people [Molyneux and his minion Lauren Southern] are just coattail-hangers. They don’t have anything new to contribute to the debate...”  In the tweet, Molyneux cites Turkheimer and Flynn as if they corroborate his propaganda. In actuality, they disprove it, and yet Molyneux continues name-checking them under the pretense that their findings are consistent with his racism.

As for four of Molyneux’s interviewees in particular — Charles Murray, Linda Gottfredson, Helmuth Nyborg, and Jason Richwine — the work for which they are best-known is not well-respected anywhere in the academic community except for a very insular and discredited circle I will discuss further below.

 Points 1 and 3 of Molyneux’s tweet are outright lies, though the dishonesty of Point 3 is more obvious.  Since late 2015 this blog has cataloged the evidence of Molneux’s support for white nationalism.  However the term eugenics remains much more obscure than “white nationalism.” For that reason, eugenics requires a deeper explanation.

The point on eugenics is of interest to me for several reasons. First, long before I heard of Molyneux, I was already interested in the topic of the ethical ramifications for eugenicist theory.  I had taken an interest in the topic because I wanted to see where it did or did not apply to a possible medical procedure in the future where parents engineer the embryos of their children, immunizing them against inheritable diseases or even adding enhancements in aptitudes. More pertinent to the topic at hand, though, throughout February this Stefan Molyneux has, as in the above tweet, ludicrously talked of eugenics as if it were a practice he has never advocated.




What Was, and Is, Eugenics?
Eugenics studies formally began in the late 1800s by Sir Francis Galton, a fellow scientist and cousin to Charles Darwin. Galton had noticed that many accomplished people came from the same family. He suspected that so many of members of the same family being so skilled and accomplished had less to do with their having grown up under the same environmental conditions than with their each having inherited those traits biologically. Sir Francis theorized that if (rich) people with the most “desirable” physical biological traits had children with one another, that would result in even “better” children. Sir Francis named his own theory eugenics. Eu- is Greek for “good”; eu-genics means “good seeds/origins/genes.”

Always connected to eugenics was a personality trait that was of special importance to Sir Francis, one that he considered to be inborn rather than the result of conditioning or one’s own choices. That trait was intelligence. Ironically, for all of his own brain power, Sir Francis himself was unable to devise a method that he found satisfactory in quantifying intelligence. The purported solution to Sir Francis’s problem would come from an unlikely source. And there was another gap in his theory that had to be filled.

Besides their blood relations and their mutual interest in biological inheritance, Galton had something else in common with Darwin.  Although both of them correctly inferred that there must be some sort of mechanism by which one generation transmits its biological traits to the next, neither Galton nor Darwin could identify what that mechanism was.

That task was left to a quiet Benedictine monk named Gregor Mendel.  It was Mendel who, through his experiments on pea plants, discovered the mechanism of the gene, and who discovered the principles behind dominant and recessive alleles. Although Mendel mailed his monograph to Darwin for comment, Darwin tragically never opened it, apparently occupied by other matters going on in his life. Hence, Darwin went to his grave not having this valuable piece of information that would further integrate his theory.

Mendel’s discoveries could easily have been lost to history if his writings were not discovered by three scientists of the early twentieth century who were tackling similar problems — Carl Correns, Hugo de Vries (who coined mutation), and Erich von Tschermak. Providing a further integration was William Bateson, who coined genetics.

Despite the two gaps in his theory that the respective works of Mendel and Binet would fill for him, Sir Francis went ahead with his eugenicist movement, undaunted. Deciding that his theory should be applied in practice, Sir Francis proposed that some governmental body should determine which people possessed the most desirable physiological traits, and then pay them taxpayer funds to incentivize them to breed with one another. In this suggestion, Sir Francis introduced an idea that is common in — though not a requirement for — eugenics advocacy. That idea is that the government should intervene in human interactions that will increase the likelihood that people will have children possessing the most “socially desirable” inborn traits, especially above-average intellectual ability.

As Sir Francis failed in developing a plausible measure of intellectual ability, the French psychologist Alfred Binet worried about children. He noticed that some children had learning disabilities.  This made him worry that the longer these disabilities remained unidentified, the more these children would fall behind in their development. He needed a method to identify which children were struggling with their learning.  It was for that reason that he devised the IQ test.

Whereas Sir Francis conceived eugenics as the perfect rationalization for his desire to elevate his own class and marginalize others, he had failed where Alfred Binet succeeded.  The IQ test that would be the salvation to Sir Francis’s theory was originally developed with the intention of lifting up the very same people whom Sir Francis and other eugenicists were working hard to marginalize.

Once they had learned of the discoveries of Mendel and Binet, it was the task of Sir Francis’s successors in leading the eugenics movement — such as mathematician Karl Pearson in the United Kingdom and biologist Charles Davenport in the United States — to incorporate Mendel’s genetics and Binet’s IQ test into Sir Francis’s overall social movement. Once this integration was performed, the movement of eugenicism had developed two main planks.

1. Theory: Free will is nonexistent at worst and unimportant at best. Free will was so unimportant to eugenicists that they did not even acknowledge it, saying that in the philosophic question over what made an adult who she is, and gave her the character she has, could only be a question of nature versus nurture — an idiom derived primarily from phrases Sir Francis Galton himself had used in writing on eugenics. In eugenics theory, the main factor in causing someone to be different from everyone else — the main factor causing her behaviors and choices — is inborn biology. 

Incorporating Mendel’s discoveries into eugenics, the theory is that if someone is more successful at business or military operations than other people, it was because of his genetics. Eugenicists would not simply say this person has superior genetics and leave it at that, however. Eugenicist theory is also collectivist. What matters is the collective. In eugenicist theory, this person with allegedly superior genes is duty-bound to transmit those superior genes to future generations. 

2. Practice: Agreement with the theory above was sufficient to make someone a eugenicist, but most eugenicists went further. Eugenics was not merely supposed to be descriptive; most eugenicists expected this discipline to be prescriptive as well. As they saw it, it was not sufficient that people be free to choose to marry and have children with whom they want. Such choices were “selfish” in that people who married and had children were making such choices without consideration for how such choices affected the gene pool of the wider society at large [see page 157 over here]. 

For this reason, the second plank of eugenics is that some genetics-savvy third party — which was usually the government, but did not always have to be — would have to intervene on people’s private fertility choices and provide them guidance. This guidance would come in the form of reminding romantic couples that in their choices with whom they had children or even interacted at all, their personal happiness must not be prioritized over actions that would provide a net benefit to their germlines and race as a whole. 

A play in a 1913 issue of The Fortnightly Review attributes this to Sir Francis’s eugenicist protégé, Karl Pearson: “As far as the elementary principles of right and wrong are concerned, what in the world can they be if they are not what is or is not expedient for society? What is social is moral, and what is social is right, and there is no safe definition of right beyond that.”

More briefly, eugenicism is defined by two beliefs. First is that genetics, not environmental conditioning or your own choices, is most decisive in determining your actions and personality traits, including those that distinguish you from others. Second is that rather than leave people alone in whom they meet, marry, and have children with, there has to be a third party that can oversee these activities.  This third party must discourage some pairings and births and approve others. All of this is for the alleged well-being of some social collective.

Note that all those planks can be believed by people of any race or ethnicity.  Therefore, a person can try to apply eugenics to any race or ethnicity, or even all of them at once. The famous writer and activist W. E. B. Du Bois, for example, urged that black families practice eugenics for the betterment of genes among blacks. For these reasons, someone can theoretically be a eugenicist without being a white supremacist. However, it is not an accident that eugenics is often associated with white supremacism. Beginning with Sir Francis himself, most eugenicists have been white and have conflated alleles associated with white skin with superiority. If one made a Venn diagram where one circle was “eugenicists” and the other was “white supremacists,” the point of overlap between the two circles would overtake the “eugenicist” circle almost completely.  It would leave but a tiny sliver to account for eugenicists who were not also white supremacists.

It is true that Mendel’s discoveries concerning alleles can greatly conflict with white supremacists’ premises. Mendelian genetics itself shows how genetics conflicts with the idea of “race,” “race” and skin color being much more superficial than genetics — literally. Because the genes for dark skin, dark irises, and dark hair are dominant, whereas light skin, blue irises, and blonde hair are recessive, the child of a black man and blonde woman will usually have dark skin. This leads many white supremacists to think of the child as being more “black” than “white.” Yet the geneticist recognizes that whatever the child’s outward appearance — “phenotype” — a look at the child’s genetics, genotype, shows the mixed-race child is not any more closely related to his father than he is to his mother.

But racism is not about rationality but rationalization. It is less concerned with science than having a veneer of scientific respectability to reinforce its preconceived conclusions. For that reason, eugenics has mostly been used as an intellectual tool of white supremacists.




Eugenics As the Originator of the Racist and Anti-Immigrationist Talking Points That Molyneux Uses
There are two main methods whereby eugenicists can shape a society’s gene pool to their liking. The first, “positive eugenics,” involves the eugenicist third-party rewarding the “right people” for procreating, thereby reinforcing and encouraging more of that behavior. That is consistent with Sir Francis’s first eugenicist policy proposal. Again, this third party does not always have to be the government.

In the 1980s millionaire optometrist Robert Klark Graham, inventor of the shatterproof eyeglasses material that would pave the way for polycarbonate glasses lenses, privately founded the Repository for Germinal Choice. This was a sperm bank where, initially, both the men donating the sperm and the women receiving it would have to have higher-than-average IQs. (Graham’s failure to attract enough people led to him lowering his standards later.) Graham was explicitly inspired by the eugenicist propaganda of the Pioneer Fund (more about that below) and he was directly helped by three known eugenicists — Garrett Hardin, who coined “the tragedy of the commons”; Nobel Prize-winning geneticist Hermann Müller; and William Shockley, co-inventor of the transistor. The last of those three was explicitly a white supremacist as well. As the sperm bank was a wholly voluntary matter, it was an example of private institutions enacting positive eugenics, the private sperm bank being the third party.

The second method, “negative eugenics,” is more well-known. As suggested by the name, negative eugenics is involves the eugenicist third-party taking action to discourage or prevent particular people, those deemed undesirable, from being able to procreate and transmit their “inferior” genes to future generations. The most well-known and horrifying means of doing this was mass murder. The Third Reich outright murdered people of ethnicities it deemed defective. Another method was for state governments in the USA to impose compulsory sterilization of people they judged unfit — mostly epileptics and other persons with psychiatric disorders and low IQs.

In a February video where he disingenuously denies ever having any sympathies for eugenics, Stefan Molyneux pretends that murder and compulsory sterilization were the only forms of negative eugenics that governments employed. Molyneux conspicuously omitted mention of two other violent method that governments employed to “protect” the white population from being polluted and “replaced” by allegedly genetically sub-par races. The first of these was miscegenation laws — ordinances and statutes penalizing interracial marriages. This is of interest in that Molyneux has repeatedly direly cautioned his audience against interracial couplings. The second method was immigration restriction. For multiple reasons — not just because this immigration restriction is something that Molyneux has long advocated, and on the basis of the original eugenics movement — this omission of the role eugenics has historically played in the enactment of immigration restrictions is very convenient for Molyneux.

An organization that played an especially role in the eugenics movement, not merely in the USA but even in Germany under the Third Reich, was an American not-for-profit called the Pioneer Fund. The Pioneer Fund was founded in 1937 by Wickliffe Draper, the heir to a vast textile fortune. The aims of the Pioneer Fund were then explicitly eugenicist and racist. Even this early in the organization’s history, it was already developing a racist theory that, with some minor alterations, Molyneux would be approvingly repeating from 2015 onward.

Latching onto Alfred Binet’s IQ test, the Pioneer Fund scholars noticed that IQ was a stronger predictor than other factors in predicting how financially successful someone would be in life, and that, on average, some “races” scored higher on IQ tests than others. There is a lot of evidence that someone’s IQ is strongly influenced by the level of living standards under which that person grew up. Anticipating that that might become the accepted explanation for disparities in IQ scores between people, the Pioneer Fund sought to convince the public that inborn genetics, especially genetics relating to skin color, was the primary driver of IQ.

Among the recommendations the Pioneer Fund made for public policy was the restriction of immigration into the United States on the basis of race, genetics, and IQ. Just as many members of the Alt-Right do today, eugenicists associated with the Pioneer Fund, such as Madison Grant and Charles Davenport, bemoaned the influx of impoverished immigrants into the USA who were of ethnicities they considered culturally and genetically different from themselves. Foreshadowing the very same rhetoric from today’s Alt-Right, they predicted that these ethnic-alien immigrants would come to the USA and reproduce.

Either these alien immigrants would marry native-born WASPs, which would produce hybrids the eugenicists considered a net decline in quality for the population, or the ethnic aliens would keep to themselves in their own enclaves and ghettos, having too much sex, and eventually out-breeding the native-born WASP population. As today’s Alt-Right screams about a great replacement of whites causing a “white genocide”, the eugenicists of the late nineteenth and early twentieth centuries proclaimed that a failure on the part of native-born WASPs to obstruct the immigration of these impoverished aliens would lead to the replacement of the native-born WASPs.  Eugenicists referred to this as the WASPs’ own “race suicide.”

However, the impoverished immigrant ethnicities the original eugenicists feared most were not the exact same ethnicities about which Stefan Molyeux and his Alt-Right cronies howl today.  Whereas Molyneux and the Alt-Right of today demagogue against Latinos, Arabs, and Africans, the fashionable fears of the 1920s were directed toward another set of ethnicities. Eugenicists had already barred the immigration of Chinese people through the Page Act of 1875 and the Chinese Exclusion Act of 1882, and, with eugenicist Theodore Roosevelt successfully pressuring the Japanese government in 1907 to take on the task of preventing its own Japanese citizens from migrating to the continental USA (but not Hawaii, then a U.S. territory).  With Asian immigration restricted, eugenicists turned their ire toward people who are usually considered white today:  southern and eastern Europeans.

It was the immigration of these people that was restricted in the Immigration Act of 1924. This law, signed by President Calvin Coolidge, imposed national origin quotas that were explicitly racist and eugenicist in intention.  The quotas favored immigration from northern and western European Protestants and curbed immigration from southern and eastern European Catholics and Jews.

Here we find an interesting irony in Molyneux’s white-nationalism advocacy. Molyneux has twice praised Poland as a model for other white nationalists to follow. Of his trip to Poland, Molyneux first said disingenuously, “First of all, I’ve always been skeptical of the ideas of white nationalism, of identitarianism, and white identity.” Then, to the extol the virtues of what he considers to be a whites-only society, he continued, “However, I am an empiricist, and I could not help but notice that I could have peaceful, free, easy, civilized, and safe discussions in what is essentially an all-white country.” In another video, he pronounced,

You know, I go to Poland — what is it, 99-percent white? I don’t need any security. The streets are incredibly clean. Crime is almost nonexistent. Nobody gets called a racist. There’s no talk of white privilege. No identity politics. No endless diversity-nagging. You know, I’ve spoken against white nationalism, but I’m an empiricist. I’m an empiricist! I went to the country. I saw how it was like. . . . I’ve spoken out against white nationalism, but I’m am empiricist. I’m listening. I’m listening to my experiences. Can’t argue with the facts. Can’t argue with the reality.

Yet this same Molyneux praises the very same national origin quotas that the original eugenicists championed and enacted, national-origin quotas that were finally removed in 1965 with the Hart-Celler Act. (Contrary to Molyneux and his followers, the Hart-Celler Act was not the huge opening up of the borders they call it. The national-quotas were replaced by the current visa system, which places caps on the number of visas issued to each country. No more than 7 percent of the recipients of visas each year can come from the same country, but, because Mexico adjoins the USA, over 23 percent of visa applications understandably come from Mexico. This disparity, which anti-immigrationists such as Stephen Miller and Rep. Tom Cotton refuse to rectify through any liberalization, is a major reason why so many people have to resort to immigrating covertly.)

In misrepresenting the 1965 Hart-Celler Act as some anarchic opening up of America to all the nonwhites of the world, Molyneux mourns the repeal of the openly-eugenicist national origin quotas. He tells one caller, “First of all, America from 1925 to 1965 had a virtual moratorium on immigration. And, by the way, it was in fact one of the more prosperous times — if not the most prosperous times — in American history.” In calling this duration such a prosperous time, Molyneux overlooked that the Great Depression fell in the middle of it.  He likewise snivels to Peter and Anita calling in from Sweden,

Sweden decided in 1975, with no public consultation, to become a multicultural nation in the same way America decided — the Democrats in 1965, with no public consultation, and with specific lies told to the public about the effects of these policies — changed the Immigration Act to cut off immigration from Europe [big lie from Molyneux] and open it up to the Third World, to decide to become a multicultural nation.

Here is the irony in that: unlike Molyneux, the crafters of the Immigration Act of 1924 not only did not praise Poles for their whiteness, but did not even consider Poles to be white. They reviled Poles as congenitally penurious people who would pollute the gene pool of the United States if they migrated here and had children here. The consequence of the same national-origin quotas that Molyneux defended, reports the New York Times, was that in the USA, “the arrival of Italians and Poles fell by 90 percent” in 1924. As Daniel Okrent discloses, “There were more than 3.5 million Jews in Poland in 1939. Under the National Origins law, the 1939 quota for the entire nation allowed only 6,524 Poles, Jews and non-Jews alike, to enter the United States legally.”

Of special note here was how the Pioneer Fund and its major backers, such as Madison Grant and Charles Davenport, strongly supported the restrictions against Polish immigrants, especially those who were trying to come as refugees from Naziism. The Pioneer Fund’s complicity in this historical travesty extends far beyond its success in preventing the Third Reich’s victims from finding refuge. The Pioneer Fund’s contributions to the Third Reich’s power were much more direct, even friendly.

During the 1930s, American scholars financed by the Pioneer Fund, including Grant and Davenport, communicated directly with “race scientists” of the Third-Reich government: Hans K. F. Günther, Erwin Bauer, Fritz Lenz, and Eugen Fischer. (Yes, someone named Eugen was an expert on eugen-ics.) These were not racists who merely happened to live in Germany when Adolf Hitler was chancellor. They were employed directly by the Third Reich government for the stated purpose of advancing the Aryan race at the expense of Jews, Roma people, and any other ethnicity the Nazis disliked. As his employees, they ultimately answered to the Führer himself. In Europe, the Third-Reich race scientists cited the experts of the Pioneer Fund. In turn, the Third Reich sent its propaganda movies about its eugenics program to the Pioneer Fund, and the Pioneer Fund got these films shown throughout the United States in high school science classes and even churches. In the duration of the thirties and up until U.S. entry into World War II, the Pioneer Fund provided apologetics in America for the Third Reich’s eugenicist measures.

It was only when Americans confronted the atrocities the Third Reich committed, taking eugenics to its only possible conclusion, that the discipline of eugenics in general fell into a well-earned disrepute throughout the Western world. This was not, however, the end of the Pioneer Fund itself, which underwent a re-branding. Henceforth, the Pioneer Fund and its adherents had to discard the term eugenics, which had deservedly gained a negative stigma. Moreover, on account of the civil rights movement, white supremacism had gained a deserved stigma as well. Henceforth, advocates of the Pioneer Fund’s propaganda would refer to it as “race realism” and the science of “human biodiversity.” But while its self-designations had changed, the Pioneer Fund’s overall mission had not. It had to become more covert in its methods for promulgating eugenics and white supremacism.

Now being more discreet, the Pioneer Fund had to make its racist argument through indirect means. It did this by stressing average IQ. The argument arrive by means of syllogisms deduced from shaky premises. This is the first syllogism, which is stated explicitly.

• Differences in living standards are caused by differences in IQ.
• The “races” have differences in living standards.
• Therefore, the “races” having different living standards is caused by differences in IQ.

Once that syllogism is accepted, Pioneer Fund cronies introduce the next premise: Differences in IQ are a factor that is biologically inborn and immutable.

When, in the privacy of your mind, you apply that new premise to the above syllogism, this is the next syllogism you are to deduce, one that the Pioneer Fund is relatively careful about not making too blatant.

• Differences in IQ are a factor that is biologically inborn and immutable.
• The “races” having different living standards is caused by differences in average IQ.
• Therefore, the “races” having different living standards is caused by a factor that is biologically inborn and immutable.

This is a roundabout method for saying that insofar as there are unequal living standards between members of different races, this is mostly explained by inborn, congenital differences between those races, differences that no public policy can rectify. Because he is less clever than most people associated with the Pioneer Fund, Stefan Molyneux has stated openly his reason for choosing this set of syllogisms as his explanation for poverty among nonwhites in the West.  You can hear him give that reason in this 1 minute, 12-second-long clip video:

1 minute, 12 seconds

Molyneux assumes that if he rejects this eugenicist rationalization for unequal living standards between ethnic groups, the only alternative is the accept the popular left-wing idea that the poverty of blacks and Latinos relative to whites is mostly explained by pervasive systemic and institutionalized racism toward nonwhites.  This is a type of racial inequality that, convenient for his demagoguery, Molyneux conflates with an accusation that whites generally hate nonwhites and generally choose to act toward them out of malice.

This demonstrates how, as much as he touts himself as a genius, Molyneux possesses a weak and uncreative imagination. The situation is more complex. Even after slavery and Jim Crow have been vanquished, they have made such a powerful difference the circumstances of many people that even with slavery and Jim Crow gone, their geographic, political, and psychological after-effects can continue to have an impact. And though Molyneux and many other white supremacists talk about welfare payments as if those are the only governmental program that can discourage or impede entrepreneurship among nonwhites, Richard Rothstein and his book The Color of Law provide much more plausible explanations for how governmental programs have deprived many blacks and Latinos of access to the same capital markets that are more accessible to whites.

As an example, the New Deal and the Truman administration subsidized affordable housing for whites to an extent far greater than what was done for blacks and Latinos. And insofar as later government programs from the Lyndon Johnson administration onward have attempted to help blacks and Latinos catch up, the benefits that white families had already received decades earlier were “grandfathered” in and had a better chance to perpetuate themselves.

In any case, as I have argued before, the Pioneer Fund syllogisms that Molyneux has adopted and propagated are based on faulty assumptions. It is true that IQ is a better predictor than many other variables when it comes to predicting who will have high living standards as an adult. But, as psychologist Gena Gorlin has pointed out to Yaron Brook, this is not because IQ is a good predictor in its own right. Rather, IQ is a weak predictor, and it is rated a better predictor than the other variables because those others are even weaker.

Moreover, though living standards and IQ correlate, it does not follow that an ethnic group starts off with a high average high IQ while in poverty, and then grows prosperous. Rather, rises in average IQ for an ethnic group follows that ethnic group’s rise in living standards. In a flimsy attempt not to appear racist, Molyneux and the Pioneer Fund propagandists stress that East Asians, on average, score higher on IQ tests than whites and are often richer than whites. But, contrary to their insinuations, it is not the case that East Asians having a higher average IQ than whites was the default.

The same James Flynn whom Molyneux had interviewed, only for him later to express disgust toward Molyneux, has looked at the historical administering of intelligence tests to Asian-Americans. Flynn found that when the data are standardized, as recently as 1975, Chinese-Americans had a lower average IQ score than white Americans. Those of East Asian descent began to outpace white Americans in average IQ only subsequent to their having outpaced white Americans in terms of average wealth.

Subsequent to World War II, and among several others, four scholars connected to the Pioneer Fund and its race-realism propaganda rose to prominence. Those four are Charles Murray, Linda Gottfredson, Helmuth Nyborg, and Jason Richwine. As you will recall, these four are among the “17 scientists [sic; 16 interviewees]” whom Molyneux cited in his tweet as if they prove he is not a eugenicist or racist.

It is thus interesting to note how, in their eugenicism, Molyneux and the Pioneer Fund are parasitic off of two scientists in particular who probably would have abhorred their aims. First is Gregor Mendel, who was reputedly a gentle soul whose quiet life was in great contrast to the aggressive domination that Molyneux and the Pioneer Fund seek over nonwhites. Second is Alfred Binet, who devised the IQ test as only a means of helping children who were marginalized.  It is easy to imagine that Binet would have hated how his invention is used, by bigots, who could not equal his achievement, in their attempt to perpetuate the marginalization of the sort of vulnerable people whom he had sought to help.




Conclusion: Sargon’s Convenient Denial of the Message Molyneux Has Routinely Spouted for the Past Four Years
As in his February 2020 video, Molyneux can unconvincingly deny as much as he wants that he ever promoted eugenics. In reality, his propaganda about race and IQ, and against impoverished immigrants, comes from an organization that was openly eugenicist from its founding to World War II.  And it is from an organization that, until the war, partnered with the Third-Reich government in openly eugenicist advocacy.

Assisting Molyneux in that denial is Sargon of Akkad. Sargon concludes his January 2020 apologia for Molyneux by proclaiming his doubt that Molyneux ever spoke well of eugenics or white nationalism. To anyone who identifies Molyneux as the eugenicist and white natinonalist that he is, Sargon challenges, “When did he say that? Where’s the clip? Where’s the quote? Like, prove what you have asserted.”

Sargon, challenge accepted. Below are the clips of Molyneux. Molyneux has explicitly announced his evaluation that white nationalism makes good points that are gaining his sympathy. And although, at the start of this year, Molyneux has dishonestly claimed never to have voiced support for eugenics, there was a time, when he first started promoting the Pioneer Fund’s propaganda about race and IQ, where he was more honest and let it slip that he knew that this is all eugenics. Then more openly favorable toward the topic, Molyneux told Bill Whittle that as much as he may deny that he is talking eugenics, he still believes that “freedom has a eugenics component to it inevitably.”

4-minute, 44-second cut

6-minutes, 39-second cut

2-minute cut, which can be embedded in a tweet

Postscript: The Freedomain Cult Splitting Up Families
In that same pro-Molyneux video, by the way, Sargon tries to downplay the notion that Molyneux should face any culpability for his long history of pressuring his fans to disown their parents, siblings, and longtime friends if these people do not agree with ideological points Molyneux has espoused. This is a practice Molyneux has started at least as early as 2006, and he received much more attention for it in 2014, when he lost a major portion of his anarchist following. It was then that the major ideological focus of Molyneux’s podcast stopped being “anarcho-capitalism” and instead “race realism.”

Of Molyneux’s emphasis on trying to split families apart, Sargon says, “I think those accusations are probably somewhat overstated, aren’t they? And this, I think, is something that happened a long time ago. And I think it would be fair if we were to ask him his positions on these things now.”

Although Molyneux received the most attention for this practice in 2014, it does not mean it has stopped. Rather, it has continued in more recent years. As I have blogged before, Molyneux has done this at least twice publicly since 2017. Below are two long montages showing this, and a greatly-edited two-minute version that can be embedded in a tweet.

15-minute cut

20-minute cut (less of Molyneux’s tangents have been cut out)

2-minute cut that can fit in a tweet (a lot of editing, with some interjections edited out of the sentences; for the complete sentences, watch and hear the 20-minute version)

On Thursday, July 16, 2020, I shortened the sentences and changed the grammar a bit.

Imagination Is About Reality

Stuart K. Hayashi

• I could eat something that kills me. But, for the most part, I eat to live. Eating is for survival.



• I can use language to tell a lie. But one relies on language to tell the truth and to learn it in conceptual detail. More than not, language is the tool for learning and transmitting the truth.



• I can use my imagination to indulge in, and transmit, delusions. But all deductions rely on imagination; rational decision-making relies on imagination. Imagination is the tool for comprehending and living in reality.