https://youtubetranscript.com/?v=NTh3ci483eM
If ownership means something, it has to mean something like the right to trade the thing you own for other things you want, because why the hell else would you bother owning it? I mean, it’ll produce profit, perhaps, but with that profit, you still want to be able to buy things that you can own, so it’s the same problem. So what we need here, at least to some degree, the reason I’m driving it all of this is because we’re facing a situation in our culture where there are fundamental revolutionary critiques at the first principle level, right? We’re not sovereign individuals. We’re members of a group. We didn’t band together for cooperation. We banded together to maximize our own selfish needs, our own selfish ambitions. And we do that as a consequence of the expression of arbitrary power, that the fundamental relationship between people in a hierarchy is exploitative, that the enlightenment idea of the sovereign individual is nothing but a justification for claims of power for the privileged group. I mean, these are fundamental critiques. They go all the way to the bottom, which is why I’m trying to chase things down to the bottom. I’m also, and I want to go to this too at some point, it’s an attractive set of ideas. It’s an optimistic set of ideas, but it isn’t instilling the same revolutionary fervour among a minority of young people, let’s say in our culture, that these more radical, the more radical critical ideas are. And so we also have to address that problem is that this is kind of a nice way of looking at the world. It’s optimistic. It’s positive, but it’s not romantically attractive and it’s being attacked madly. And so we can’t defend it very well. So, okay, so we’ll sketch that out. Back to ownership. So, so yeah, I think at some point in this, you know, discussion, you know what Mises would stress is to say, hey, let’s not lose sight of the fact that, and just so you know, Dr. Peters, and he Mises was not a natural law theorist, right? So even though plenty of people like libertarians love the work of Mises and people who are very ideological and have views as to like where property comes from and ethically, Mises was more utilitarian or pragmatic. And I think he would just say, you know, yeah, I’m happy to have these discussions about the philosophy and the underpinnings of justice and so forth, but push comes to shove the means of like factories and farmland and crude oil deposits and other minerals and things like that. Those all need to be owned privately too, because you need to have market prices for those things. Because a given business enterprise needs to be able at the end of the accounting period to say, were we profitable or not? And that’s the only way we can know if it’s using scarce resources effectively. Okay, so one reason for ownership is that it’s very difficult to monetize something without that ownership. And if you can’t monetize it, you can’t calculate its value. And if you can’t calculate its value, you can’t use it. Or you can’t know whether you’re using it efficiently or not. Well, but that would be the same thing, essentially, because if you don’t use it efficiently, you’re going to have to stop using it pretty damn quickly. And so to some degree, pricing is the antidote to the tragedy of the commons. That’s another way of looking at it is that. So for example, in the in the oceans, no one owns the oceans, at least not past once you get out 200 miles, it’s free for all essentially. And so the consequence of that is that everyone is incentivized to take every goddamn fish as fast as they possibly can. And that’s exactly what’s happened. And it’s because the fish are free. Right. But they’re not because they’re a finite resource. And so the problem is we haven’t monetized or a problem, a potential problem is that we haven’t assigned a monetized value to the fish. And so once they’re pulled into an economy, there were something but out there free floating, it’s every man for himself. And so that means that without private property, you know, you could make a case that private property leads to the despoiling of the natural environment. Say, OK, well, what about those situations where there is no private property? Well, then you get instantaneous despoiling of the natural environment because there’s no incentive to maintain it. So we could say you need to own things so that your commitment to your specialization is paid for. Right. So I want you to become a brain surgeon. That means I have to give you something. And to give you something means you get to own it to dispose of it as you see fit. And so we’re going to we want to incentivize everyone to specialize so that we can exploit each other with maximal efficiency efficiency. And that’s to everyone’s good. It’s something to that’s in everyone’s best interests. It’s something like that. And so we need private property to manage the incentive. And then you also said to price things properly, because that’s also an important consideration. Right. So historically, even before Mises came along, yet the the critics of socialism warned about the incentive issue and like to say, hey, there are some really productive people. If they’re just getting paid from each according to his ability to each according to his needs, why would a super productive person exert himself so much if he’s just going to get food based on how many people are in his household or something? You know, that kind of thing. So that that was a standard thing. But then the socialists countered that and said, well, no, in a socialist society, there’d be a new socialist man who would just give out of altruism, just to benefit, to be the benefactor of his fellow man. And it’s only when you grow up in a capitalist system that you’re greedy and self-centered because you have to be to survive. So Mises came along and he and his argument, you know, he acknowledged the truth of the incentive issues, but his was more of a calculation or just a. Knowing what to do and saying, you know, even if we stipulate for the sake of argument that all the comrades are willing to do whatever the central planners tell in the central planners truly want the best for their subjects. It’s just you don’t know where should we locate the factories? How much how many cars should we make? Should we build more food distribution centers? Should we have more farms here or there? How many of our incoming of our crop of young scholars should go into these different technical fields? Okay. And the reason the reason that you don’t know that is because in order to know that in order to know the price of one thing, you have to know the price of everything else. Right. Right. That’s the fundamental problem. So and then the problem is worse because well, how in the world can you calculate the fundamental price of everything? Because that’s an insuperable computational obstacle. And the answer is, well, you distribute the computational problem to the maximum number of actors and you try to bring everything under the monetization web. Right. And you and there are places where that where we have real trouble with that where we can’t monetize something accurately. Yeah. So there’s there’s areas where it doesn’t work very well. But in general, yes, if you just think about what does it mean in a decentralized market economy with private property, not just for carpenters owning hammers, but for the whole factory being owned by a small group of people or one person, you know, everything is owned privately. And then, yeah, people have accountants. And at the end, like I say, of an accounting period, they look back and say, how did we do? And if they’re profitable, just think through what does that mean? It means their customers gave them more dollars than they had to spend on the resources to make that stuff, the goods or the services. Well, we could use an analogy. So imagine you’re a carpenter and you want to build a house, but you don’t have a ruler. You don’t have any way to measure length. Right. Well, so maybe you eyeball it. Maybe you get pretty good at that. But for maybe you can’t even do that. So you can’t measure length and now you have to build a house. Well, you can’t because you have to measure. And so then the fundamental principle here is that money is the measure of value and it’s computed as a consequence of a distributed network. And that’s the only reason it works. And each person is pursuing something of value insofar as they’re capable of doing that. And they make some pricing decisions on the basis of their specialized expertise. And then we sum the consequences of that specialized computation. And we have a price for everything or virtually everything. And because we have a price for everything, we can roughly decide what to do. So it’s best to think of this really as a computational enterprise. I believe. Right. Yeah. Yeah. Mises used the term calculation. Yeah. And that was so you’re exactly right. He argued that one of the most important distinctions of modern civilization was the ability to apply arithmetic to human act. Right. Right. Right. Right. Right. Right. So yeah, this is the measurement issue. And so we’re basically making the case that you can’t get anywhere unless you can measure. And money is the measure. And it’s a measure. And so the proposition that central planning will work is the proposition that you can substitute one expert mind for a million distributed expert minds. And that’s just not the case. It’s obviously not the case because each person is going to have knowledge that pertains to their locality that isn’t accessible. And that’s another element of specialization that isn’t accessible to everyone. And so it’s much better to let everyone make the decisions and some of them. And and so we have this this free market society isn’t a mechanism to allow property holders to exploit others. Let’s say it’s a mechanism that the entire human race uses to calculate the comparative value of everything. Right. And it makes thought possible. And then Mies does point that out when he talks about arithmetic is that it enables us to do arithmetic. And we can decide is it worth it.