the freeman - 2015 summer (green issue)

8/18/2019 The Freeman - 2015 Summer (Green Issue)

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SUMMER 2015


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EDITOR Max Borders

MANAGING EDITOR B.K. Marc us

COPY EDITOR Amy Font ine lle

POETRY EDITOR Luk e Han kin s

CONTRIBUTING EDITOR Jeff rey A. Tucker

ART DIRECTOR Sara Seal

PUBLISHER Richard N. L ore nc

DEPUTY PUBLISHER James Anderson

FOUNDATION FOR ECONOMIC EDUCATION

PRESIDENT

Law ren ce W. Reed

EXECUTIVE DIRECTOR Wayne Olson

STAFF

Dan iel Bie r

Marianna Brashear

Lau ren Hick s Jaso n Ke lly

Carrie Leggins

Sara Morrison

Carl Oberg

Ian Osta szews ki

Rob ert Ram sey

Jaso n R iddle

William Smith

Jus tin St reif f

El ise Tho mpson

BOARD OF TRUSTEES

CHAIRMAN Roger Ream

VICE CHAIRMAN Harry H. Langenberg

SECRETARY Ingrid A. Gregg

TREASURER Michael S. Yashko

Sarah Atkins

Harold (Jay) Bowen III

Jeff Giesea

Kris Alan Mauren

Don Smith

Chris Talley

John Westerfield

VOLUME 65 | NO. 02

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RECYCLE THIS PAGE

This issue o he Freeman is dedicaed o Moher Earh. We operae

wih he knowledge ha, when i comes o he goals o conservaion

and proecion, wealhier is healhier. Tha is, when he insiuions,innovaions, and incenives are correc, we will no only be wealhier,

bu here will be no conradicion beween ree markes and a cleaner

environmen.

The global warming debae, such as i is, seems o have been purchased

by hose wih power. For all he reting abou he influence o oil

ineress on he debae, public choice heory ells us ha coaliions

o booleggers and Bapiss will accree around any acions by he

governmen o save us rom environmenal caasrophe. O course,

when governmen and indusry collude, ruh becomes a moving arge.

Hyseria goes on aucion. And he people pay he coss.

I doesn’ mater who does he wagging, he ail or he dog. Thereare enough rue believers in climae caasrophe o eed an army o

bureaucras and o line he pockes o a housand special ineress. A

he ron o his incesuous line sand he expers: he climaologiss are

having heir day in he sun (no pun). The economiss are able suddenly

o read he enrails ha ell us wha a warmer uure will bring.

They receive major grans, ame, and saus rom being on he side

o he angels. Unorunaely, proven environmenal problems such as

overfishing ge shor shrif as he grea hyseria nexus keeps everyone

preoccupied wih he climae.

Le us go orward wih his summer ediion hinking warm houghs

abou how he world is geting beter (and greener)—how a creaive,

enrepreneurial people can be good sewards o he environmen, even

wihou (especially wihou) cenral energy planning, green dirigisme,

and he olly o demand-side managemen. There is a long road ahead,

as he road o caasrophe will be paved wih good inenions.

— THE EDITORS

SUBSCRIBE

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and constitutionally limited government. FEE has been publishing the

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IN THIS ISSUE

ETHICS &

PERSONAL GROWTH

OUR PAST &

OUR FUTURE

ARTS &

CULTURE

FEATURES

ECONOMICS & POLICY

21

02 ARENA

MANDATORY VACCINATIONS CAN BE

COMPATIBLE WITH LIBERTY

Randal John Meyer

04 ARENA

MANDATORY VACCINATIONS ARE

INCOMPATIBLE WITH LIBERTY

Robert P. Murphy

16 THE GREEN ISSUE

THE CLIMATE-INDUSTRIAL COMPLEX

STRIKES BACK

Max Borders

21 THE GREEN ISSUE

THE COSTS OF HYSTERIA

Robert P. Murphy

24 THE GREEN ISSUE

POLITICAL RAIN DANCE

Daniel Bier

10

FREEDOM OF DISASSOCIATION:

INDIANA EDITION

Steven Horwitz

14

ADAM SMITH: ZEN MASTER

Sandy Ikeda

28

PICKING PIKETTY APART

Phillip Magness

12

HARRIET TUBMAN

RISKED LIFE AND

LIMB FOR LIBERTY

Lawrence W. Reed

40

THE 7 HABITS OF

HIGHLY EFFECTIVE

LIBERTARIANS

Jeffrey A. Tucker

08

DECENTRALIZATION:

WHY DUMB NETWORKS

ARE BETTER

Andreas M. Antonopoulos

32

ARMED AND BLACK

B.K. Marcus

06

REGULATE THE

DATING MARKET

Julian Adorney

38

STAY PUT?

Sarah Skwire

46

THE NIGHT THRESHER

Devin Murphy

47

LIFE, LIFE

Arseny Tarkovsky


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2 FEE.org

We can ake comor ha modern science can handle

inecious diseases. Quesionable sudies such as repors

linking vaccinaions o auism have been debunked. Despie

he empirically demonsrable efficacy o vaccines, some

people have decided o orgo vaccinaions or hemselves or

or children under heir cusody. Accordingly, liberarians

have been orced o examine heir own enes o evaluae

wheher compulsory vaccinaions are compaible wih he

principles o individual reedom.

I believe hey are.

A major piall or liberarians examining his quesion

is he consideraion o wheher mandaory vaccinaions are

oo paernalisic. Bu because vaccinaions preven harm oohers wih incidenal paernalisic effecs, I argue ha hey

are jusified. Because cerain deadly diseases are communi-

cable rom human-o-human conac, ransmission can be

prevened by using medically sae vaccines.

Vaccines do no always and in every case proec indi-

viduals who receive hem. Baceria and viruses can muae,

prevening vaccines rom conquering hem. And, over ime,

a paricular vaccine can become less effecive. Bu when

given o a large enough populaion and updaed periodically

o couner muaions, vaccines ac like a compuer firewall,

proecing he enire populaion. And i a significan enough

porion o he populaion chooses no o be vaccinaed,

hen he whole populaion becomes more suscepible o an

oubreak. Immunizaion o a criical proporion o he pop-

ulaion in his manner is called “herd immuniy.” Though i

may seem paradoxical, i becomes imporan o ensure ha

he vas majoriy o people ge immunized o preven harm.

Liberarian philosophy holds ha i is jusifiable o

preven unauhorized harm o one individual agains

anoher. Accordingly, even liberarians who have adoped

principles such as he nonaggression axiom or he harm

principle can see ha vaccinaion is a means o preven-ing harm. Moreover, even liberarians who ollow a sric

Rohbardian nonaggression principle consider he prospect

o aggression o be indisinguishable rom acual aggres-

sion. And his is reasonable: prevening imminen harm is

as good as sopping presen harm.

Universiy o Arizona proessor Joel Feinberg has argued

ha “i is always a good reason in suppor o legislaion ha

i would probably be effecive in prevening (eliminaing or

reducing) harm o persons oher han he acor and here is

MANDATORY VACCINATIONS CAN BE

COMPATIBLE WITH LIBERTYBy Randal John Meyer

MANDATORY VACCINES

ARENA

Image credit: US Army Corps of Engineers


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FEATURES | SUMMER 2015

probably no oher means ha is equally effecive a no

greaer cos o oher values.”

John Suar Mill amously noes in On Liberty ha “he

only purpose or which power can be righully exercisedover any member o a civilized communiy, agains his will,

is o preven harm o ohers.”

The quesions o wheher he nonimmunized members

o a populaion pose a risk o ohers—as well as he effecive-

ness o vaccinaions in prevening ha harm—urn on acs.

To address such quesions, le’s ake a look a he disease ha

has led o mos o his recen conroversy: measles.

I one imagines a communiy wih an immuniy rae

o 96–99 percen or measles due o vaccinaion (and mos

saes all below his rae), i is saisically unlikely ha

here will be an oubreak o measles in his populaion due

o herd immuniy. When only 95 percen o he populaion

is vaccinaed, an oubreak is possible. When he percenagevaccinaed alls below 90 percen, he rae o inecion per

10,000 children more han doubles.

I he rae alls low enough, we

can expec pandemics. “Beore

mass vaccinaion was inroduced,

measles used o ollow a cyclic

patern, wih [epidemics occurring

each] period o abou 2 years in

Europe and Norh America,”

according o research by V.A.A. Jansen and N. Sollenwerk.

From 1840 hrough 1990, measles killed nearly

200 million people globally. Bu rom 2000 hrough 2012,

measles deahs decreased by 78 percen afer he UN

sponsored immunizaion. During his period, 68 percen o

he populaions o member counries were immunized o

herd immuniy levels. In he Unied Saes, he vaccinaion

rae among inans was 91 percen, considerably below he

96–99 percen needed or herd immuniy o be mainained.

In ac, in some enclaves, such as he Orange Couny school

disric, he immunizaion rae dropped o 50–60 percen

among kindergareners. This ailure o vaccinae, a leas

in par due o he exisence o he sae philosophical

exempion rom vaccinaion, allowed he measles oubreak

o occur in 2015 in more han a dozen saes.

No individual has he righ o expose oher individualso ha risk.

Alernaively, here is a parallel argumen rom he lib-erarian principles regarding common deense. Accordingo David Boaz in his updaed book, The Libertarian Mind,“mos liberarians” believe ha “governmens should exis…[o provide] naional deense agains exernal hreas.”The enire human race is a war wih microbes, such asviruses, and has undergone massive assauls. Examplesinclude he bubonic plague, smallpox, and polio. Each day,

an individual’s immune sysem desroys numerouspoenial pahogens. Libery-resrain principles allow orcollecivizaion o deense effors agains equally deadly

oes: our immune sysems are no alone in his. Vaccines areinsrumens o ha ongoing war.

People should no be compelled o be vaccinaed or non-

communicable diseases, o course, bu we don’ wan any

o hese serious pahogens o reemerge. Measles, mumps,

rubella, and perussis cases are all on he rise in he Unied

Saes. Polio has reurned in more han 10 counries; he

World Healh Organizaion believes i consiues a global

healh emergency. Childhood vaccines save nearly $40 billion

in direc and indirec coss, in addiion o numerous lives.

I is imporan o noe, as well, ha compulsory vacci-naion can accomplish herd immuniy by means shor oorced procedures. On one level, he civil law could be used

o hold nonvaccinaed aduls and he parens o nonvac-cinaed children financially liable wih puniive damages

or heir role in any public healhemergency. Exclusion romvarious ypes o public space oraciviies could be jusified, yeenorcemen would be difficul,i no impossible, paricularly inurban areas. On a more resric-ive level, he sae could use he

criminal law o impose fines on parens or declare hasuch acion consiues child neglec. Regardless, moreexreme measures or noncomplian aduls would only beappropriae i more resricive means could no achieveherd immuniy hresholds.

Thus, i can be argued ha vaccinaion policy approach-

ing inringemen on individual and parenal choice does no

pose an issue per se wih mainsream liberarian hough,

given he narrowness o he means o vaccinaion (how litle

i imposes on he recipien’s libery) and he degree o rela-

ively cerain harm o ohers ha is hereby prevened.

The harm o nonvaccinaion or serious communicable

diseases poses a significan enough risk or ohers o become

ineced ha i jusifies such small imposiions on personal

libery. A policy o volunary vaccinaion, or he graning o

philosophical excepions o he general vaccinaion require-men, causes much more poenial harm han requiring

people o ge a vaccinaion does.

Randal John Meyer is a Young Voices Advocate and a legal

research fellow living in New York City.

PREVENTING IMMINENT

HARM IS AS GOOD AS

STOPPING PRESENT HARM.


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Mandaory vaccinaions are a gross violaion olibery. On some governmen policy issues—includingmandaory quaranines, airpor checkpoins, and NSAemail scanning—here is a leas a coheren allegaion oa rade-off beween individual reedom and public saey.Bu when i comes o mandaory vaccinaions, here is litlescope or plausible debae.

Mandaory vaccinaions involve a supreme violaion

o libery, where agens o he sae injec subsances inosomeone’s body agains his or her will. On he oher side

o he ledger, even in principle, mandaory vaccinaions do

no offer much benefi in enhanced public welare, relaive

o a ree sociey. When we hrow in

he realisic worries o governmen

incompeence and maleasance,

he case agains mandaory vacci-

naions is overwhelming.

Beore making my case, I will

explain in basic erms how differen

groups are likely o rea he propo-

siion, according o major concepions o he sae’s proper

role. I do his in order o show ha, even i we’re being charia-

ble o he mos inclusive concepions o libery as a principle,

mandaory vaccinaions are sill no jusifiable.

Firs, among hose who hew sricly o a nonaggressionprinciple and a saeless sociey, mandaory vaccinaions are,o course, a nonsarer. Wheher hey ideniy hemselvesas “sric liberarians,” “volunaryiss,” or “anarchocapial-iss,” his group would obviously never condone he sae’sorcing someone o be vaccinaed, because mos believe hesae is illegiimae.

Second, or minarchiss, he proper role or he sae is

ha o a “nigh wachman,” a minimal governmen ha only

proecs he individual rom domesic criminals and oreignhreas. In a minarchis ramework, i is only legiimae or

he sae o ake acion agains someone who is violaing

(or hreaening o violae) he righs o anoher. A person’s

ailure o become vaccinaed is hardly by itself a violaion o

someone else’s righs. Flipping i around, i would sound odd

o say you have he right o live in a sociey where everyone

else has had measles shos.

Third, and mos ineresing, le’s consider a broader

noion o libery, which balances a presumpion o individual

auonomy agains he public welare. In his approach,

here’s no a blanke prohibiion on he sae resricing he

liberies o individuals—even when hey haven’ ye hur

anybody else—so long as such resricions impose litle

harm on he recipiens and possibly preven a vas amoun

o damage. This is he only concepion o he sae or which

he mandaory vaccinaion debae is possible.

Le’s be chariable and assume his more expansive

definiion, under which, or example, even sel-describedliberarians migh no objec o siff penalies or drunk

driving or prohibiions on ciizens building aomic bombs in

heir basemens. How does mandaory vaccinaion are in

his ramework, where we’re no

arguing in erms o qualiaive

principles bu insead perorming

a quaniaive cos-benefi es?

Even here, he case or

mandaory vaccinaions is weak.

Firs o all, he only realisic

scenario where he issue would

even be relevan is where he vas majoriy o he public

hinks i would be a good idea i everyone go vaccinaed, bu

(or whaever reason) a small minoriy srongly disagreed. This

is obvious: i he medical case or a vaccine were so dubious

ha, say, hal he public didn’ hink i made sense o adminis-

er i, hen here would hardly be an issue o he governmen

clamoring o injec hal he populaion agains heir will.

Now, le’s push our analysis urher. We’re dealing wih

a scenario in which he vas majoriy o he public hinks

i would be a good idea or all o he public o become vacci-

naed. In ha environmen, i vaccines are volunary, hen

we can be confiden ha jus abou all o hese enhusiass

would go ahead and become vaccinaed. In oher words, any

“ree riding” would only ake place a he margin, i mos ohe populaion had goten he vaccine and hus an oubreak

o he relevan disease was unlikely.

This is a crucial poin, and i shows why he case or

mandaory vaccines is so much weaker han, or example, he

case or mandaory resricions on carbon dioxide emissions

or mandaory conribuions o he naional miliary.

When a person ges vaccinaed, he primary beneficiary is

himself . And his benefi is all he greaer he lower he rae

o vaccinaion in he populaion a large. In oher words,

MANDATORY VACCINATIONS ARE

INCOMPATIBLE WITH LIBERTY

Social conflict can be resolved through the fuller application of private property rights

By Robert P. Murphy

ARENA

MANDATORY VACCINATIONS

INVOLVE A SUPREME

VIOLATION OF LIBERTY...


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among a populaion o people who all believe ha a vaccine

is effecive, he individual cos-benefi analysis o aking he

vaccine will only yield a empaion o “ree riding” once a

sufficien racion o he populaion has become vaccinaed,

hus ensuring “herd immuniy.”

Unlike oher examples o huge (alleged) rade-offs

beween individual and public benefis, wih vaccinaions

here is no hrea o a mass oubreak in a ree sociey. Wih

vaccines, we have he happy oucome ha when someone

chooses o vaccinae him or hersel, so long as he vaccine is

effecive, hen ha person is largely shielded rom he conse-

quences o ohers’ decisions regarding vaccinaion.

However, he proponens o mandaory vaccinaions

say ha his analysis is oo glib. There are people who can’t

undergo cerain vaccinaions because o medical condiions,

including young people (babies) who are no ye old enough

o receive cerain shos. I is o proec these vulnerable

pockes o he populaion ha some wan he sae o orcevaccinaions on hose who are oo ignoran or oo selfish o

recognize heir duy o living in a communiy.

Noice he irony and how weak he mandaory vacci-

naion case has become. We are no longer being old ha

vaccines are “sae,” and ha anyone who ears medical com-

plicaions is a conspiracy heoris rusing Jenny McCarhy

over guys in whie lab coas. On he conrary, he CDC warns

cerain groups not o ake popular vaccines because o he

healh risks. This is no longer a mater o principle—o he

people on he side o science being pro-vaccine, while he

inoil-haters are ani-vaccine. Insead i’s a disagreemen

over which people should be aking he vaccine and which

people should not ake i because he dangers are oo grea.

Regarding children, social conflic can be resolved

hrough he uller applicaion o privae propery righs. I

all schools, hospials, and daycare ceners were privaely

operaed and had he legal righ o exclude whichever

cliens hey wished, hen he owners could decide on vacci-

naion policies. Any parens who were horrified a he idea

o litle Jimmy playing wih an unvaccinaed kid could

choose Jimmy’s school accordingly.

We have seen ha even assuming he bes o govern-men officials, i is difficul o sae an argumen in avoro mandaory vaccinaions. Ye, he debae ils even morewhen we recall ha hroughou hisory, governmenofficials have made horrible decisions in he name o public

welare, eiher hrough incompeence or ulerior moives.I should be obvious ha no an o libery can supporinjecing subsances ino an innocen person’s body againshis or her will.

Robert P. Murphy (FEE.org/Murphy) is the senior economist

with the Institute for Energy Research.

Unlike other examples of huge (alleged)

trade-offs between individual and public

benefits, with vaccinations there is no threat

of a mass outbreak in a free society.


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REGULATE THE DATING MARKET

A MODEST PROPOSAL FOR ROMANTIC JUSTICE

This year’s Valenine’s Day was disasrous—no jusor me, bu or many ex-couples. Bu as I sa here lasFebruary nursing my broken hear, I realized wha’swrong wih romance oday: no enough regulaion.

The Unied Saes governmen has wisely chosen oregulae mos oher aspecs o lie, rom wha wage youare allowed o work or o wha medicines a paien isallowed o buy over he couner. Volunary ineracions

are all well and good, bu he botom line is ha peoplehave o be proeced rom hemselves. The rade-off

beween libery and securiy exiss no only in privacyand oreign policy: we mus srike a similar balance inhe arena o love.

I propose he creaion o a new governmen organiza-ion, he Commitee o Assure Romanic Equiy (CARE),o bring an end o he curren Wild Wes o romance.Three powerul ses o regulaions would bring much-needed sabiliy o he chaos o daing.

1. WHO’S ALLOWED TO DATE?

Jus as proessionals—rom hair braiders o inerior

decoraors—mus be licensed, so oo he governmen mus

sep in o license daers.

Righ now, he daing marke is overrun wih shoddy

specimens. Sleazy men buy women drinks and sleep

wih hem on he firs dae. Immoral women chea on

heir loving boyriends. Many people lack he discreion

o choose good parners or hemselves, and heir poor

decisions can bring ou he wors in people. Never mind

ha hey someimes have children.

To remedy his siuaion, any daing hopeul shouldhave o submi an applicaion o CARE. A licensingsysem should be se up whereby applicans pay or

classes in order o ceriy boh heir good-hearedness andheir abiliy o rea a parner well. In order o enorcehis sysem, CARE agens would inspec couples, finingor jailing any individual engaged in daing wihoua CARE permi.

This wise sep will remove he riffraff rom he daing

marke and ensure ha good, kind individuals are never

lured ino romances hey’ll regre. And i a ew people find

hemselves orcibly removed rom he daing pool, so wha?

They probably weren’ grea parners o begin wih.

2.DATING TICKETS

I is sel-eviden by now ha ree markes aren’ qualified

o disribue scarce naural resources. Unregulaed capial-

ism causes inense inequaliy.

Today, some men and women have our or five daes per

week. Ohers may suffer dry spells lasing monhs. Furher,

hose individuals who go on many daes have an opporu-

niy o hone heir skills, making hem more atracive and

ensuring even more daes in he uure, while hose whohaven’ had a dae in monhs simply languish. Their skills

deeriorae, making hem less and less atracive.

Such a siuaion is unequal and unair. I highlighs how

unetered markes creae a rich-ge-richer environmen in

which a lucky ew rise o he op while he majoriy suffers.

I proves ha reurns o love capial happen only a he op

o he disribuion, or as Thomas Pikety migh summarize

his heory, r > l, where r is he rae o reurn on love capial

and l is he rae o love growh or he res o us.

To remedy his siuaion, every man and woman

should be orced o submi o CARE he number o daes

he or she has planned each week. I someone has more

han our, one o hose daes should be randomly reas-

signed o a person who hasn’ been on a dae in a monh

or more. This sysem will ensure a more even disribuion

o daes, in which each man and woman ges a air share.(Apps like Tinder and OKCupid will have o be replaced by

a single-payer CARE app.)

3. BREAKUPS

Some people—no o name names—plan a beauiul

weekend geaway or Valenine’s Day, only o be dumped

wihou warning because we’re “oo poliical.” This siuaion

isn’ jus immoral; i ough o be illegal!

The governmen already regulaes who can be fired rom

Julian Adorney writes from Lakewood, Colorado.

Just as professionals—from hair braiders

to interior decorators—must be licensed,

so too the government must step in to

license daters.


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SUMMER 2015

a job and under wha circumsances. We realize, or example,

he ragic consequences o a woman losing her sole means o

income, so we ake seps o proec employees.

Bu is losing love any less raumaic? Hearbreak can

lead o pain, misery, and even deah. Wih his ac in mind,

I propose a ew common-sense resricions on breaking up

wih a significan oher.

Each man or woman preparing o le a parner go shouldhave o fill ou several orms showing due cause. No one

should have o ear being dumped or rifling reasons such as

“oo much” poliical acivism. Wih he guidance o CARE,

relaionships will be susained ha should be susained—

even as hose ha have a jusifiable reason o end will be

allowed o do so.

Similarly, we as a sociey should no longer olerae

breakups ha give no warning. A person seeking o break

up wih a significan oher should have o fill ou a writen

complain, noiy his or her parner, and wai wo weeks

beore he breakup. This noice will give he injured pary

ime o adjus o he new saus quo.

WHAT ABOUT FREEDOM?

Some naysayers complain ha his new CARE will limi

our reedom. Bu reedom is no he only value. We have o

consider he greaer good.Freedom is olerable when exercised in ways ha

serve sociey, bu is excesses mus be curbed o prevenis exercise in anisocial ways. Good, decen people needsome securiy in he romance marke. I ha means a litleless independence or everyone else, so be i. Those whodemand unetered reedom are simply apologiss or hehearbreak saus quo.

Each man or woman preparing to let a

partner go should have to fill out several forms showing due cause.

Image credit: Julia Lorenc


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“Every device employed to bolster

individual freedom must have as its

chief purpose the impairment of the

absoluteness of power.” —Eric Hoffer

In compuer and communicaions neworks, decenral-

izaion leads o aser innovaion, greaer openness, and

lower cos. Decenralizaion creaes he condiions or com-

peiion and diversiy in he services he nework provides.

Bu how can you ell i a nework is decenralized, and

wha makes i more likely o be decenralized?

Nework “inelligence” is he characerisic

ha differeniaes cenralized rom decenral-

ized neworks—bu in a way ha is surprising

and counerinuiive.

Some neworks are “smar.” They offer

sophisicaed services ha can be delivered o

very simple end-user devices on he “edge” o

he nework. Oher neworks are “dumb”—hey

offer only a very basic service and require ha he end-user

devices are inelligen. Wha’s smar abou dumb neworks

is ha hey push innovaion o he edge, giving end users

conrol over he pace and direcion o innovaion. Simpliciy

a he cener allows or complexiy a he edge, which osers

he vas decenralizaion o services.

Surprisingly, hen, “dumb” neworks are he smar choice

or innovaion and reedom.

The elephone nework used o be a smar nework sup-poring dumb devices (elephones). All he inelligence in

he elephone nework and all he services were conained in

he phone company’s swiching buildings. The elephone on

he consumer’s kichen able was litle more han a speaker

and a microphone. Even he mos advanced ouch-one ele-

phones were sill prety simple devices, depending enirely

on he nework services hey could “reques” hrough

beeping he righ ones.

In a smar nework like ha, here is no room or inno-

vaion a he edge. Sure, you can make a phone look like a

cheeseburger or a banana, bu you can’ change he services

i offers. The services depend enirely on he cenral swiches

owned by he phone company. Cenralized innovaion means

slow innovaion. I also means innovaion direced by hegoals o a single company. As a resul, anyhing ha doesn’

seem o fi he vision o he company ha owns he nework

is rejeced or even acively ough.

In ac, unil 1968, AT&T resriced he devices allowed

on he nework o a handul o approved devices. In 1968, in a

landmark decision, he FCC ruled in avor o he Carerone,

an acousic coupler device or connecing wo-way radios o

elephones, opening he door or any consumer device ha

didn’ “cause harm o he sysem.”

Tha ruling paved he way or he answering machine,

he ax machine, and he modem. Bu even wih he abiliy o

connec smarer devices o he edge, i wasn’ unil he modem

ha innovaion really acceleraed. The modem represeneda complee inversion o he archiecure: all he inelligence

was moved o he edge, and he phone nework was used only

as an underlying “dumb” nework o carry he daa.

Did he elecommunicaions companies welcome his

developmen? O course no! They ough i or nearly a

decade, using regulaion, lobbying, and legal hreas agains

he new compeiion. In some counries, modem calls across

inernaional lines were auomaically dis-

conneced o preven compeiion in he

lucraive long-disance marke. In he end,

he Inerne won. Now, almos he enire

phone nework runs as an app on op o he

Inerne.

The Inerne is a dumb nework, which

is is defining and mos valuable eaure.

The Inerne’s proocol (ransmission conrol

proocol/Inerne proocol, or TCP/IP) doesn’ offer “services.”

I doesn’ make decisions abou conen. I doesn’ disinguish

beween phoos and ex, video and audio. I doesn’ have a lis

o approved applicaions. I doesn’ even disinguish beween

clien and server, user and hos, or individual versus corpora-

ion. Every IP address is an equal peer.

TCP/IP acs as an efficien pipeline, moving daa rom

one poin o anoher. Over ime, i has had some minor

adjusmens o offer some differeniaed “qualiy o service”capabiliies, bu oher han ha, i remains, or he mos par,

a dumb daa pipeline. Almos all he inelligence is on he

edge—all he services, all he applicaions are creaed on he

edge-devices. Creaing a new applicaion does no involve

changing he nework. The Web, voice, video, and social

media were all creaed as applicaions on he edge wihou

any need o modiy he Inerne proocol.

So he dumb nework becomes a plaorm or inde-

penden innovaion, wihou permission, a he edge. The

resul is an incredible range o innovaions, carried ou a

Dumb networks

are the smart

choice forinnovation and

freedom.

Decentralization:

Why Dumb

Networks Are Better

THE SMART CHOICE IS INNOVATION AT THE EDGE

Andreas M. Antonopoulos is the author of Masering Bicoin ,a technical book published by O’Reilly Media.


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FEE.org 9

OUR PAST & OUR FUTURE | SUMMER 2015

an even more incredible pace. People ineresed in even he

inies o niche applicaions can creae hem on he edge.

Applicaions ha only have wo paricipans only need

wo devices o suppor hem, and hey can run on he

Inerne. Conras ha o he elephone nework, where anew “service,” like caller ID, had o be buil and deployed

on every company swich, incurring mainenance cos or

every subscriber. So only he mos popular, profiable, and

widely used services go deployed.

The financial services indusry is buil on op o many

highly specialized and service-specific neworks. Mos o

hese are layered aop he Inerne, bu hey are archieced

as closed, cenralized, and “smar” neworks wih limied

inelligence on he edge.

Take, or example, he Sociey or Worldwide Inerbank

Financial Telecommunicaion (SWIFT), he inernaional

wire ranser nework. The consorium behind SWIFT

has buil a closed nework o member banks ha offersspecific services: secure messages, mosly paymen orders.

Only banks can be members, and he nework services are

highly cenralized.

The SWIFT nework is jus one o dozens o

single-purpose, ighly conrolled, and closed neworks

offered o financial services companies such as banks,

brokerage firms, and exchanges. All hese neworks

mediae he services by inerposing he service provider

beween he “users,” and hey allow minimal innova-

ion or differeniaion a he edge—ha is, hey are smar

neworks serving mosly dumb devices.

Bicoin is he Inerne o money. I offers a basic dumb

nework ha connecs peers rom anywhere in he world.

The bicoin nework isel does no define any financial

services or applicaions. I doesn’ require membership

regisraion or idenificaion. I doesn’ conrol he ypes

o devices or applicaions ha can live on is edge. Bicoin

offers one service: securely ime-samped scriped rans-

acions. Everyhing else is buil on he edge-devices as an

applicaion. Bicoin allows any applicaion o be developed

independenly, wihou permission, on he edge o he

nework. A developer can creae a new applicaion using

he ransacional service as a plaorm and deploy i on

any device. Even niche applicaions wih ew users—

applicaions never envisioned by he bicoin proocolcreaor—can be buil and deployed.

Almos any nework archiecure can be invered. You

can build a closed nework on op o an open nework or

vice versa, alhough i is easier o cenralize han o decen-

ralize. The modem invered he phone nework, giving us he

Inerne. The banks have buil closed nework sysems on op

o he decenralized Inerne. Now bicoin provides an open

nework plaorm or financial services on op o he open and

decenralized Inerne. The financial services buil on op o

bicoin are hemselves open because hey are no “services”

delivered by he nework; hey are “apps” running on op

o he nework. This arrangemen opens a marke or applica-

ions, puting he end user in a posiion o power o choose he

righ applicaion wihou resricions.

Wha happens when an indusry ransiions rom using

one or more “smar” and cenralized neworks o using a

common, decenralized, open, and dumb nework? A sunamio innovaion ha was pen up or decades is suddenly

released. All he applicaions ha could never ge permission

in he closed nework can now be developed and deployed

wihou permission. A firs, his change involves reinven-

ing he previously cenralized services wih new and open

decenralized alernaives. We saw ha wih he Inerne,

as radiional elecommunicaions services were reinvened

wih email, insan messaging, and video calls.

This firs wave is also characerized by disintermediation—

he removal o enire layers o inermediaries who are no

longer necessary. Wih he Inerne, his mean replacing

brokers, classified ads publishers, real esae agens, car sales-

people, and many ohers wih search engines and online

direc markes. In he financial indusry, bicoin will creae

a similar wave o disinermediaion by making clearing-

houses, exchanges, and wire ranser services obsolee. The

big difference is ha some o hese disinermediaed layers

are mulibillion-dollar indusries ha are no longer needed.

Beyond he firs wave o innovaion, which simply

replaces exising services, is anoher wave ha begins

o build he applicaions ha were impossible wih he

previous cenralized nework. The second wave doesn’

jus creae applicaions ha compare o exising services;

i spawns new indusries on he basis o applicaions ha

were previously oo expensive or oo difficul o scale. Byeliminaing ricion in paymens, bicoin doesn’ jus make

beter paymens; i inroduces marke mechanisms and

price discovery o economic aciviies ha were oo small or

inefficien under he previous cos srucure.

We used o hink “smar” neworks would deliver he

mos value, bu making he nework “dumb” enabled a

massive wave o innovaion. Inelligence a he edge brings

choice, reedom, and experimenaion wihou permission.

In neworks, “dumb” is beter.


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10 FEE.org

FREEDOM of DISASSOCIATION:

Indiana Edition

Revulsion is not an argument; and some of yesterday’s repugnances are today

calmly accepted—though, one must add, not always for the better.

In crucial cases, however, repugnance is the emotional expression of deep wisdom,

beyond reason’s power fully to articulate it.

By STEVEN HORWITZ


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FEE.org 11

The passage o Indiana’s version o he Religious Freedom

Resoraion Ac has generaed all kinds o commenary rom

boh lef and righ, and mos o i is misguided or overwrough.

I’d like o offer a ew o my own houghs on hesematers, which, I hink, add up o a call or boh olerance and

reedom o associaion—as well as a rejecion o repugnance

as he basis or public policy.

Tolerance lies a he core o he liberarian worldview.

Living peaceully wih each oher means acceping our differ-

ences and allowing ohers o engage in behavior ha we migh

dislike bu ha does no harm hird paries. “Anyhing ha’s

peaceul” is our lodesar, as Leonard Read ofen reminded us.

Such olerance does no require ha we associate wih people

we disagree wih, only ha we leave hem in peace. And his

idea cus o he core o he debae in Indiana.

I, like me, you hink ha gays and lesbians are no doing

anyhing harmul o anyone, and ha hey should be reaed jus like oher human beings, you migh call he behavior

o hose who reuse o, or example, provide phoography

services a a same-sex marriage “inoleran.” Perhaps i is, bu

hose who have such views are no engaged in any atemp o

preven gays and lesbians rom geting married—or anyhing

else—by reusing o provide hem wih a service. They are,

in ac, oleraing hem, bu also reusing o associae wih

hem. Tolerance does no mandae associaion.

Any idea o olerance ha mandaes associaion will

quickly ge us ino rouble. I, or example, you objec o hose

who reuse o sell heir producs or services o gays and

lesbians because homosexualiy runs couner o heir deeply

held belies, would i no be a ar worse orm o inolerance

o make i illegal or hem o ac on heir religious belies?

Afer all, your side is willing implicily (or explicily) o back

is inolerance o religious convicions wih coercion—you

know, guns, fines, and prisons—while he oher side’s inol-

erance involves only he simple and peaceul reusal o sell.

To repea: hose who reuse o sell are no prevening

people rom behaving peaceully; hose who would make he

reusal o sell illegal are.

I, like me, you are bohered by he behavior o hose

who won’ deal wih gays or lesbians, you shouldn’ make

maters worse by using sae power o engage in rue inoler-

ance. Insead, demonsrae how much you really care abouolerance by using persuasion and disassociaion o change

he behavior you find inoleran.

To see how real olerance, persuasion, and disassociaion

in civil sociey can work, consider his sory rom Texas:

a narrow-minded sore clerk objeced o a mom leting her

litle girl wear a boy’s sui. Mom’s riends heard he sory and

hen gave he sore bad reviews online. (And unlike he small,

Chrisian-owned pizzeria in Indiana, no one hreaened he

owners or hreaened o burn down he sore, boh o which

would have crossed he line ha separaes real olerance

rom coercion.) The sore pulled is Facebook page afer

people lef criical commens. Mom was no acually “deniedservice,” because she immediaely declared she wouldn’

paronize he sore due o he clerk’s atiude.

Wha didn’ happen?

No one sued, used violence, called he police, or said,

“There ough o be a law.” People used words, repuaion, and

he power o exi o persuade ohers o who was righ and who

was wrong. This is how i should work. We don’ need a law.

The mom had choices and exercised hem, and he clerk and

sore paid a price or indulging heir views on gender sereo-

ypes. This is peaceul conflic resoluion involving he righs

o expression, exi, and disassociaion—no need o ge he

sae involved. Tolerance, afer all, does no mean we have o

like everyhing everyone else does. I only means we can’ andshouldn’ sop hem rom doing anyhing ha’s peaceul.

Too ofen, we ry o make laws on he basis o our mere

dislike or ohers’ behavior. As a avorie Inerne meme

o mine says, “Everyhing I like should be mandaory and

everyhing I don’ like should be banned.” This sor o

reacion o our repugnance a he behavior o ohers is a real

danger o liberal socieies.

Wheher i involves oulawing peaceul behavior, orced

associaion, or sae-sponsored discriminaion, using repug-

nance as he basis or enacing laws is isel repugnan. Wha

we end up wih, afer all, is poisonous discourse and a social

order ha is increasingly coarse and uncivil.

Why were people hreaening he owners o a small pizza

shop in Indiana who, hypoheically, said hey would peace-

ully reuse o caer a same-sex wedding? Wha underlies

such hreas is he belie ha repugnance (in whaever orm

i akes) jusifies coercion. Tha belie also helps explain why

ohers are so vehemenly opposed o giving same-sex couples

legal equaliy. Wheher i’s repugnance a people’s religious

belies or repugnance a he hough o wo people o he

same sex being married, such an emoion does no suffice o

rump undamenal reedoms.

Sacrificing undamenal consiuional righs and our

commimen o equaliy beore he law isn’ worh he warm

glow o an ephemeral “vicory.” The rade-off is simply ooseep—as is he slippery slope i could pu us on.

Steven Horwitz (FEE.org/Horwitz) is the author of

Microoundaions and Macroeconomics:

An Ausrian Perspecive.



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12 FEE.org

When he day arrives ha a woman’s image adorns

Federal Reserve currency or he firs ime, i migh well be

ha o Harrie Tubman. She’s reporedly on he shor lis. I

may, however, be a dubious honor o appear on somehing

ha declines so regularly in value. Wihou a doub, his

woman would impar more eseem o he

bill han he bill would o her. Her value is

ar more solid and enduring.

Slavery was once ubiquious in he

world—and even inellecually respecable.

Tha began o change in he lae 18h cenury,

firs in Briain, which ended is slave rade

in 1807 and liberaed he enslaved hrough-

ou is jurisdicion in 1834. Beore he 13h

Amendmen abolished slavery in America

in 1865, American blacks risked everyhing

atemping o escape rom heir masers,

who someimes pursued hem all he way

o he Canadian border. Tubman, hersel a

ugiive slave, became he mos renowned

“conducor” on he Underground Railroad,

a nework o rails or escapees rom he

anebellum Souh o he Norh. As many as100,000 slaves risked lie and limb raveling is roues. I was

he mos dangerous “railroad” in he world.

Born Aramina Harrie Ross in 1820 in Maryland,

Tubman survived he brualiies o bondage or 29 years.

Three o her sisers had been sold o disan planaion

owners. She hersel carried scars or her enire lie rom

requen whippings. Once, when she reused o resrain a

runaway slave, she was bashed in he head wih a wo-pound

weigh, causing lielong pain, migraines, and “buzzing” in

her ears. She boled or reedom in 1849, making her way

o he neighboring ree sae o Pennsylvania and is ciy o

broherly love, Philadelphia.

“I had crossed he line o which I had so long been

dreaming,” she laer wroe.

I was free; but there was no one to welcome

me to the land of freedom. I was a stranger

in a strange land, and my home after all was

down in the old cabin quarter, with the old

folks and my brothers and sisters. But to this

solemn resolution I came: I was free, and they

should be free also; I would make a home for

them in the North, and the Lord helping me, I

would bring them all there. Oh, how I prayed

then, lying all alone on the cold damp ground!

‘Oh, dear Lord’, I said. I haven’t got no friend but

you. Come to my help Lord, for I’m in trouble! Oh,

Lord! You’ve been with me in six troubles, don’t

desert me in the seventh!

Tubman bravely venured 13 imes

back ino slave saes o personally escora leas 70 escapees o Norhern saes and o Canada. “I was

he conducor o he Underground Railroad or eigh years,”

she amously recouned, “and I can say wha mos conduc-

ors can’ say: I never ran my rain off he rack and I never

los a passenger.” Those passengers included her aging

parens, her hree brohers, heir wives, and many o heir

children.

Working or he Union Army as a cook and nurse during

he Civil War, Tubman morphed quickly ino an armed

WORKING FOR THE

UNION ARMY AS A

COOK AND NURSE

DURING THE CIVIL

WAR, TUBMAN

MORPHED QUICKLY

INTO AN ARMED

SCOUT AND SPY.

r RISKED LIFE AND LIMB FOR LIBERTY

By Lawrence W. Reed

Image credit: H. B. Lindsley, c.1880


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ETHICS & PERSONAL GROWTH | SUMMER 2015

scou and spy. She became he war’s firs woman o lead

an armed expediion when she guided he Combahee River

Raid, an expediion ha liberaed more han 700 slaves

in Souh Carolina.For her service o he governmen—ending o newly reed

slaves, scouing ino enemy erriory, and nursing wounded

soldiers—she was reaed shameully and shabbily. She was

denied compensaion and didn’ receive a pension or her war

duies unil 1899. She ook in boarders and worked long hours

a odd jobs o make ends mee.

In an Augus 1868 leter o Tubman, amous aboliionis and

ormer slave Frederick Douglass paid ribue o her heroism:

Most that I have done and suffered in the service of our cause

has been in public, and I have received much encouragement

at every step of the way. You, on the other hand, have labored

in a private way. I have wrought in the day—you in the night. I

have had the applause of the crowd and the satisfaction that

comes of being approved by the multitude, while the most

that you have done has been witnessed by a few trembling,

scarred, and foot-sore bondmen and women, whom you

have led out of the house of bondage, and whose heartfelt

“God bless you” has been your only reward. The midnight sky and

the silent stars have been the witnesses of your devotion tofreedom and of your heroism.

Tubman spen her las decades caring or ohers,

especially he sick and aged. She ofen spoke publicly on

behal o women’s righ o voe. For relie rom ha head

injury menioned earlier, she endured brain surgery in

Boson in he lae 1890s. She reused aneshesia, preerring

insead simply o bie down on a bulle. In her words, he

surgeon “sawed open my skull, and raised i up, and now i

eels more comorable.” She died in 1913 a he age o 91—

a real hero o he very end.

In 2014, an aseroid was named or Tubman. In my book,

ha beas a Federal Reserve noe hands down.

Lawrence W. Reed (FEE.org/Reed) is the president of FEE.


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14 FEE.org

According o Eckhar Tolle, he popular auhor o spiriual

books including The Power of Now, happiness is only possible

in he presen, he Now. Pas and uure are beyond reach,

and so “he presen momen is all you ever have.” He wries,

Nothing ever happened in the past; it happened in the Now. Noth-

ing will ever happen in the future; it will happen in the Now.

His message isn’ ha we should orge he pas or

abandon planning or he uure. Raher, he’s expressing a

psychological atiude consisen wih many spiriual and

religious radiions, Easern and Wesern.

Economiss, Ludwig von Mises and Adam Smih among

hem, have writen in similar erms abou he meaning and

significance o he Now.

THE PRAXEOLOGICAL NOW

I’s rue ha Mises’s ocus on he Now isn’ o explainhow o achieve happiness. In ac, in he radiion oCarl Menger ha Mises helped o develop, one o herequiremens or human acion is ha we eel uneasyabou our curren siuaion, and uneasiness isn’ consis-en wih mos conceps o happiness. Bu he relevanpoin or Mises is ha human acion only akes place in hepresen. Specifically, “rom he praxeological aspec [ha is,he aspec relevan o economics] here is beween he pasand he uure a real exended presen. Acion is as suchin he real presen because i uilizes he insan and husembodies is realiy,” he wries.

And he doesn’ quie say, wih Tolle, ha i’s only in he

presen ha we can ap ino realiy. Bu he does say ha

he only ime available o us in which o ac—o apply he

knowledge gained rom he pas o change he uure inaccordance wih our expecaions—is he “real exended

presen.” The Now exiss beween memory and expecaion.

Smih also wroe abou he power o Now, and in much

he same spiri as Tolle.

A SMITHIAN PERSPECTIVE

Smih’s Wealth of Nations, published in 1776, is considered

he firs exended and sysemaic reamen o economics.

Is lessons are sill relevan, and I highly recommend i o

anyone who seriously wans o learn abou economic heory

and economic hisory. Bu i’s no my avorie work by Smih.

My avorie, because o is subjec mater and especially

is beauiul wriing, is Smih’s Theory of Moral Sentiments,

published in 1759. I won’ atemp o summarize i excep

o say ha i concerns he naure and origins o senimens,

such as sympahy, and he role hey play in our social

relaions, similar o wha oday would all under he heading

o “culural economics.”The very firs chaper, “On Sympahy,” begins,

How selfish soever man may be supposed, there are evidently

some principles in his nature, which interest him in the fortune

of others, and render their happiness necessary to him, though

he derives nothing from it except the pleasure of seeing it. Of

this kind is pity or compassion, the emotion which we feel for the

misery of others, when we either see it, or are made to conceive it

in a very lively manner.

I you only know Smih rom The Wealth of Nations, wih

is imporan lesson ha “i is no rom he benevolence o

he bucher, he brewer, or he baker ha we expec our

dinner, bu rom heir regard o heir own ineres,” i may

surprise you o see his opening observaion on compassion.

Personally, I was surprised by he level o psychological

analysis conained in The Theory of Moral Sentiments, espe-

cially he insighs ino human happiness and unhappiness:

The great source of both the misery and disorders of human

life, seems to arise from over-rating the difference between

one permanent situation and another. Avarice over-rates

the difference between poverty and riches: ambition, that

between a private and a public station: vain-glory, that

between obscurity and extensive reputation.

So avarice and misplaced pride and ambiion are he

sources o misery o anyone, regardless o saus or saion. And

he social disincions we make beween people in differen

proessions aren’ due o differences in naure, a poin Smih

makes in a amous passage in The Wealth of Nations:

The difference between the most dissimilar characters, between

a philosopher and a common street porter, for example, seems

to arise not so much from nature as from habit, custom, and ed-

ADAM SMITH: ZEN MASTER

EAST AND WEST CONVERGE ON THE “POWER OF NOW”

Sandy Ikeda (FEE.org/Ikeda) is a professor of economics at Purchase College, SUNY.


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FEE.org 15

SUMMER 2015

ucation. When they came into the world, and

for the first six or eight years of their existence,

they were, perhaps, very much alike, and neither

their parents nor playfellows could perceive any

remarkable difference.

This passage reflecs Smih’s characeris-

ically liberal (in he original, classical sense

o he word) belie ha all persons are creaed

equal. And ha, in urn, leads me o his wise

passage in The Theory of Moral Sentiments:

What the favourite of the king of Epirus said to his master, may be

applied to men in all the ordinary situations of human life. When the

King had recounted to him, in their proper order, all the conquests

which he proposed to make, and had come to the last of them; And

what does your Majesty propose to do then? said the Favourite.—I

propose then, said the King, to enjoy myself with my friends, and

endeavour to be good company over a bottle.—And what hinders

your Majesty from doing so now? replied the Favourite.

How wise! Smih goes on o explain,

In the most glittering and exalted situation that our

idle fancy can hold out to us, the pleasures from

which we propose to derive our real happiness, are

almost always the same with those which, in our

actual, though humble station, we have at all times at

hand, and in our power.

This isn’ merely abou sopping o smell

he roses. Smih is saying ha i’s always in our

power o be happy, whoever and wherever and

whenever we are. Happiness is and can only

be here and now, and never “jus around he corner.” In hissense, he relenless pursui o happiness is he very source o

our misery.

The inscription upon the tomb-stone of the man who had endeav-

oured to mend a tolerable constitution by taking physic; “I was

well, I wished to be better; here I am” ; may generally be applied with

great justness to the distress of disappointed avarice and ambi-

tion.

Tolle couldn’ have expressed i beter.

THE

RELENTLESS

PURSUIT OF

HAPPINESS

IS THE VERY

SOURCE OF

OUR MISERY.


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16 FEE.org


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SUMMER 2015


20/52

18 FEE.org

Climae-change skepic Willie Soon may be an unehical,

corporae-bough climae-change denier—or he laes casualy

o he Climae-Indusrial Complex’s immune response.

The New York Times’ Jusin Gillis and John Schwarz wrie,

He has accepted more than $1.2 million in money from the fos-

sil-fuel industry over the last decade while failing to disclose that

conflict of interest in most of his scientific papers. At least 11

papers he has published since 2008 omitted such a disclosure,

and in at least eight of those cases, he appears to have violated

ethical guidelines of the journals that published his work.

Somehing’s fishy here. Because all researchers ge money

rom somewhere, i’s srange ha none o he “eigh” journals

required Soon o disclose as a condiion o publicaion. Given

his repuaion as a skepic, didn’ hey even hink o ask? And,

indeed, i here really is a universal ehical sandard, aren’ he

journals ha published Soon also in violaion o he ehics?

To find ou wheher Soon aced inappropriaely and

ouside o research ehics, we really have o know wheher

ha disclosure sandard applies across he board. In oher

words, o he hundreds o journal aricles published over he

las ew years, how many auhors disclosed heir unding

sources—public, privae, corporae, or nonprofi?

I here is indeed a known ehical sandard o disclosure

o which he vas majoriy o researchers adhere, hen i

migh be appropriae or he Times o single ou Soon or a

ailure o disclose. (The Times offers no such conex, no such

daa.) However, i a majoriy does no disclose is unding

sources, hen here is clearly no well-defined ehic o dis-

closure and he Times is simply invening an impropriey oruin a man’s career as a scienis.

Now, some migh argue ha people should only be

required o publish heir unding sources i hose sources

are privae or corporae. Afer all, hey’ll argue, governmen

money is used because governmen granors only wan o

find he ruh, whereas privae granors only wan o bias

he process and o obuscae he ruh.

The idea ha a governmen gran comes wih no agenda

should be preposerous on is ace. Afer all, who has more

GREEN ISSUE

THE CLIMATEINDUSTRIALCOMPLEX STRIKES BACK

Was he New York Times piece agains Willie Soon a hi job?

By Max Borders

01


21/52

FEE.org 19


o gain rom “acion on climae change” han he very people

providing he research dollars and heir solar-powered

cronies? The members o he Climae-Indusrial Complex

have enormous incenives o hide he decline, cook he books,and keep he unds flowing ino heir deparmen coffers

and crony projecs. And hose wih axing auhoriy—ha

is, hose who hold he governmen purse srings—have an

even bigger incenive.

To pu his ino perspecive, consider he ollowing,

repored by Climate of Corruption auhor Larry Bell in Forbes:

According to the GAO, annual federal climate spending has

increased from $4.6 billion in 2003 to $8.8 billion in 2010,

amounting to $106.7 billion over that period. The money was spent

in four general categories: technology to reduce greenhouse gas

emissions, science to understand climate changes, international

assistance for developing countries, and wildlife adaptation to

respond to actual or expected changes. Technology spending,

the largest category, grew from $2.56 billion to $5.5 billion over

this period, increasingly advancing over others in total share.

Data compiled by Joanne Nova at the Science and Policy Institute

indicates that the U.S. Government spent more than $32.5 billion

on climate studies between 1989 and 2009. This doesn’t count

about $79 billion more spent for climate change technology

research, foreign aid and tax breaks for “green energy.”

These sums are only wha he US governmen is

spending. Global spending is simply saggering.

More generally, anyone who unds anything is almos

always looking or a cerain kind o resul. Thereore, any

sandard o disclosure mus apply o any and all scholars

equally, no mater he unding source.

Tha governmen money shouldn’ corrup is jus

anoher applicaion o he Unicorn Fallacy so common

among well-meaning greens. Unorunaely, because so

many people are under he illusion ha “public” money is

no a corrupive influence in science, i may be ha hosewho receive i are ar more willing o disclose a govern-

men gran han a privae one—whaever he qualiy o he

research. Or, i migh be ha journal commitees simply

don’ require researchers on he governmen dole o disclose.

(The Times offers us no such conex in he case o he

journals Soon conribued o.)

Here is some more eel-like journalism rom he Times:

Charles R. Alcock, director of the Harvard-Smithsonian Center,

acknowledged on Friday that Dr. Soon had violated the disclosure

standards of some journals.

“I think that’s inappropriate behavior,” Dr. Alcock said. “This

frankly becomes a personnel matter, which we have to handle

with Dr. Soon internally.”

Noice he weasel phrase “disclosure sandards o some

journals.” Some? Isn’ his supposed o be a sandard ha

applies o all? And how should Alcock handle he purpored

violaions o some o he journals? We don’ know because we

are only seeing he par o he conversaion he Times wans

us o see, o iner somehing, ur, uh, “inappropriae.”

Sill, wha i i is boh rue ha Soon violaed acceped

norms o disclosure relaive o peers and ha he did so

because he was araid ha o disclose his sources would lead

o accusaions o bias? Then we have o separae quesions

abou Soon’s inegriy rom quesions abou his research.

In he ormer case, here is an army o anaical cli-

mae-change aciviss ready o pounce on anyone who presens

any evidence ha runs couner o heir apocalypic narraive.

(Remember, proessional climae-change aciviss have a

huge sake in he oucome o his debae, oo. Climae-change

donaions are quie he gravy rain. Those Prius paymens don’

pay or hemselves.) Indeed, i climae-change hereics like Soon

can only ge research unding ouside he Climae-Indusrial

Complex, should we expec researchers wih unpopular

findings o erec billboards adverising heir sources?For us o ask such quesions is no mean o absolve Soon

or anyone else o abandoning generally acceped disclosure

sandards; i is merely o say ha he very climae-change

aciviss who wroe he Times piece know ull well ha his

is he sor o incenive hey creae when hey go on wich

huns or “deniers.” Climae-change science has become

a hosile environmen or skepics. Science isel becomes

he casualy o such hosiliy, which brings me o he later

poin—ha is, he qualiy o Soon’s research.

Even i we ound evidence ha Soon was he mos avaricious


22/52

20 FEE.org

villain and corporae oady he world had ever seen, would any

purpored wrongdoing invalidae his acual scholarship?

Anyone who has ever had a course in logic knows he

unequivocal answer is no. Research is eiher accurae orinaccurae, whaever he source.

Noice ha a no poin in he Times aricle did he

auhors—or anyone quoed by he auhors—acually atack

Soon’s specific scholarship. Sure, he Times makes vague

innuendo, as wih his quoe:

Many experts in the field say that Dr. Soon uses out-of-date data,

publishes spurious correlations between solar output and climate

indicators, and does not take account of the evidence implicating

emissions from human behavior in climate change.

Many expers like whom? The only quoe hey provide is

rom Gavin Schmid o he acivis websie RealClimae.org,who says, “The science ha Willie Soon does is almos

poinless.” In oher words, this Gavin Schmid:

• In 2009, “atmospheric scientist Dr. Hendrik Tennekes, a prominent

scientist from the Netherlands, wrote a scathing denunciation of

Schmidt in which he said he was ‘appalled’ by Schmidt’s ‘lack of

knowledge’ and added, ‘Back to graduate school, Gavin!’”

• Climatologist Roger Pielke Sr. publicly rebuked Schmidt for

“erroneously communicating the reality of [how the] climate

system is actually behaving.”

• Israeli astrophysicist Nir Shaviv has also been critical. “The aim of

[Schmidt’s] RealClimate.org is not to engage a sincere scientific

debate. Their aim is to post a reply full of a straw man so their

supporters can claim that your point ‘has been refuted by real

scientists at RealClimate.org.’”

• And there’s much more … including apologetics about the infamous

Climategate scandal.

We don’ wan, like he Times, o impor an ad hominem

allacy. Bu o all he innuendo, why are we being asked o

believe only ha o he world’s oremos climae aciviss?

Innuendo is convenien, bu i is no conclusive.

Maybe Soon’s research is bad or misleading or somehow

jus wrong. Bu in science, his is where he rubber his

he road. And he Times ails o deliver in demonsraingha Soon’s scienific work is incorrec, wherever he go his

research money. And ha makes his Times piece jus he

sor o agiprop we have come o expec rom he Grey Lady.

Now, wha i Soon is righ, or example, abou he

relaive effecs o he sun (versus humans) on he climae

sysem? There are housands o jobs, housands o repua-

ions, billions in unding, and rillions o uure carbon ax

revenues a sake. You hink hey’re going o le his flea

coninue o irriae he hide o Leviahan?

Bu le us be clear: he poin o he Times aricle was

never o find ou wheher Soon’s research was correc. The

poin is o use innuendo o push a hereical researcher o he

margins o science—or perhaps ou alogeher—so ha he

powers behind he Climae-Indusrial Complex can ge oha mulirillion-dollar po a he end o he rainbow.

The Times goes on o say: “The documens show ha

Dr. Soon, in correspondence wih his corporae unders,

described many o his scienific papers as ‘deliverables’ ha

he compleed in exchange or heir money. He used he

same erm o describe esimony he prepared or Congress.”

The mos apparenly damning evidence ha Soon aced

inappropriaely and was prepared o bias his research or his

corporae masers comes in he accusaion ha he reerred o

his research as a “deliverable,” and ha on anoher occasion,

he reerred o his congressional esimony as a “deliverable”?

As everyone knows, deliverables are work producs.

Someimes deliverables are paid or by companies,

someimes by governmens, someimes by NGOs. Bu as

someone who has worked in he nonprofi secor or a long

ime, I can ell you ha any ime someone gives you a gran,

hey are expecing you o do some work. And, indeed, hey

may speciy jus wha sors o work producs you are respon-

sible or producing as a condiion o receiving he gran. In

oher words, hey will wan deliverables.

Now, does ha mean ha he “deliverable” in quesion

was research ha had packaged ino i a specific, predeer-

mined resul? O course no. We should be under no illusions,

however: i Soon’s deliverables suddenly sared conaining

messages ha did no compor wih wha he granors wan

o hear, he grans migh very well dry up. Bu his is no less

rue or scieniss who ail o produce resuls ha jibe wih

he “consensus” message ha governmen granors and

climae NGOs are ond o. So why should quesions aboufinancial influence only be applied o skepics?

We should very well expec ha he Climae-Indusrial

Complex and is handmaiden, he Grey Lady, will be

looking or blood wherever hey can find i. And i we wan

o alk abou bias being bough and paid or by corporae

masers, one need look no urher han he auhors o he

Times aricle—whose omissions and double sandards are so

bald ha Balance, ha air goddess o journalism, weeps.

Max Borders (FEE.org/Borders) is editor of the Freeman.

Why should questions about financial influence only be

applied to skeptics?

GREEN ISSUE


23/52

FEE.org 21

SUMMER 2015

Suppose he “scienific consensus” on climae change is

righ. Le’s also sipulae, or he sake o argumen, ha he

compuer projecions used by he Unied Naions and he

US governmen are correc, and ha economiss are able o

ranslae hose daa ino meaningul projecions abou coss

and benefis o people living in he uure wih climae change.

Despie wha he public has been led o believe, he

siuaion is no a crisis a all—and cerainly no somehing

ha demands drasic governmen acions o aver serious

damage o he environmen. In ac, implemening he

wrong policy can cause ar more damage han i can preven.

I’s undersandable ha he public has no idea o hereal sae o he lieraure on climae change policy, because

even proessional economiss use uterly misleading rheoric

in his arena. To show wha I mean, firs, le’s quoe rom a

recen Noah Smih Bloomberg aricle, which urges lef-liberals

o suppor he Trans-Pacific Parnership (TPP) rade deal:

One of the bigger economic issues under debate right now is the

Trans-Pacific Partnership (TPP), the multilateral trade deal that

would include most countries in the Asia-Pacific region as well as

the US. Many people both here and abroad are suspicious of trade

deals, while economists usually support them. This time around,

however, the dynamic is a little bit different—the TPP is getting some

pushback from left-leaning economists such as Paul Krugman.

Krugman’s point is that since US trade is already pretty liberalized …

the effect of further liberalization will be small.… I’m usually more of

a free-trade skeptic than the average economist.… But in this case,

I’m strongly on the pro-TPP side. There are just too many good

arguments in favor.

University of California-Berkeley economist Brad DeLong does

some quick back-of-the-envelope calculations, and estimates thatthe TPP would increase the world’s wealth by a total of $3 trillion.

Though that’s not a big deal in the grand scheme of things, it’s one

of the best reforms that’s feasible in the current polarized political

situation. (emphasis added)

To summarize he flavor o Smih’s discussion, he hinks

he TPP is “one o he bigger economic issues” oday, and

ha is poenial windall o humaniy o $3 rillion is “no a

big deal in he grand scheme o hings” bu cerainly worh

pursuing i atainable. Krugman disagrees wih Smih’s

THE COSTS OF HYSTERIAHow economiss are misleading he

public on climae-change policy

By Robert P. Murphy

02

Image credit: NPS Climate Change Response


24/52

22 FEE.org

assessmen, bu heir differences are clearly quibbles over

numbers and sraegies; i’s no as i Smih hinks Krugman

is a “Ricardo denier” or accuses Krugman o haing poor

Asians by opposing he rade deal.We ge a much differen one i insead we look a Smih

discussing climae-change policy. For example, in June 2014,

Smih wroe a Bloomberg piece on five ways o figh global

warming. In he ineres o breviy, le

me simply quoe Smih’s concluding

paragraph:

If we do these five things, then the

US can still save the world from global

warming, even though we’re no longer

the main cause of the problem. And

the short-run cost to our economy will

be very moderate. Saving the world on

the cheap sounds like a good idea to me.

(emphasis added)

Clearly, here is a chasm in he

rheoric beween Smih’s wo Bloomberg pieces. When dis-

cussing he TPP, i’s an hones disagreemen beween

expers over a rade agreemen ha Smih hinks is defi-

niely worhwhile, bu in he grand scheme is no ha big

a deal. In conras, governmen policies concerning climae

change lierally involve he ae o he plane.

A his poin, mos readers would wonder wha he

problem is. Afer all, isn’ man-made climae change a global

crisis? Why shouldn’t Smih use much sronger rheoric

when describing i?

I am making his comparison because according oone o he pioneers in climae-change economics, William

Nordhaus, even i all governmens around he world imple-

mened he exbook-perec carbon ax, he ne gain o

humaniy would be … drumroll please

… $3 rillion. In oher words, one o

he world’s expers on he economics

o climae change esimaes ha he

difference o humaniy beween (a)

implemening he perec carbon-ax

policy soluion and (b) doing absoluely

nohing was abou he same difference

as DeLong esimaed when i comes o

he TPP.To be more specific, he $3 rillion

Nordhaus esimae comes rom he

2008 calibraion o his Dynamic

Inegraed Climae-Economy

(DICE) model. (The numbers have gone up since hen, bu

I sudied his 2008 calibraion in grea deail.) Noe ha

his isn’ some “denier” compuer simulaion, rejeced by

he serious scieniss. On he conrary, Nordhaus’s DICE

model was one o only hree chosen by he Obama admin-

israion when i se up a working group o esimae he

moneary damages o carbon dioxide emissions. To help

Despite what the public has beenled to believe, the

situation is nota crisis at all.

GREEN ISSUE

The wrong climate policy can be much,

much worse than doing nothing.


25/52

FEE.org 23

DICE’S RELATIVE BENEFITS OF DIFFERENT CLIMATE POLICIES

Table 4

in Trillions of 2005 U.S. $

CLIMATE POLICY

Note: PDV = present discounted value. Source: Adapted from Nordhaus 2008, 89.

No controls baseline

Optimal tax

Limit CO2 to 560 ppm

Kyoto with the United States

Kyoto without the United States

Stern Review discount rate

Limit temp. to 1.5°C

Limit CO2 to 420 ppm

Gore’s 90 percent emissions cut

0.00

+3.07

+2.67

+0.63

+0.10

-14.18

-14.44

-14.60

-21.36

22.55

17.31

15.97

21.38

22.43

9.02

9.95

9.95

10.05

0.04

2.20

3.95

0.58

0.07

27.74

27.08

27.24

33.90

22.59

19.52

19.92

21.96

22.49

36.77

37.03

37.19

43.96

PDV DIFFERENCE

FROM BASELINE

PDV OF

ENVIRONMENTAL

DAMAGES

PDV OF

ABATEMENT COSTS

SUM OF DAMAGE

AND COSTS

he reader undersand he rade-offs humaniy aces

when i comes o climae change, le me reproduce able 4

rom my Independent Review aricle (“Rolling he DICE:

William Nordhaus’s Dubious Case or a Carbon Tax,”

14[2]: 197–217), which criically evaluaed Nordhaus’s model.

The able above shows Nordhaus’s esimaes (made in

2008 based on he “consensus” scienific assessmens o he

ime) o he ne benefis o various possible governmenal

climae policy approaches. The firs row shows wha happens

i governmens do nohing. There will be $22.55 rillion (in

presen value erms, and quoed in 2005 dollars) o environ-

menal damage, bu virually no economic coss o complying

wih regulaions, or a oal harm o $22.59 rillion.

In conras, i governmens around he world imple-

mened Nordhaus’s recommended “opimal” carbon ax,

he world would be spared a litle more han $5 rillion

in uure environmenal damage, while uure economic

oupu would be $2.2 rillion lower due o complying wih

he carbon ax. Adding i all up, humaniy would suffer

oal harms o $19.52 rillion, meaning he world would be

$3.07 rillion wealhier wih he opimal, global carbon ax

(because $22.59 − $19.52 = $3.07).Cenral o he economic way o hinking is he concep o

rade-offs. Every possible policy—including a policy o doing

nohing—comes wih coss. Bu he public ends o hear abou

only one se o coss, no he ull array. For example, as he

earlier able shows, he wrong climae policy can be much,

much worse han doing nohing. Nordhaus evaluaed Al Gore’s

suggesion o cu emissions by 90 percen, and esimaed ha

i would make humaniy some $21 rillion poorer compared o

he do-nohing baseline—a ne harm seven imes greaer han

he ne benefis o he exbook-opimal approach.

My poin here is no o rumpe Nordhaus’s numbers

as being gospel. (My Independent Review aricle was a ull-

blown critique o his model.) Raher, I am poining ou ha

even one o he leading models ha underpins he so-called

consensus on climae-change acivism shows ha his is

hardly he planeary crisis ha he rheoric o Smih and

ohers would sugges. The acual numbers are in he same

ballpark as hose o rade deals—and nobody hinks he ae

o he plane hangs on he passage o a rade deal.

More generally, wha even mos economiss have ailed

o convey o he public is ha climae-change policies a bes

will affec hings on the margin. Nordhaus’s able beauiully

illusraes his. The opimal carbon ax doesn’ eliminate

he climae-change damage ha his compuer simulaions

predic. On he conrary, he carbon ax only reduces i rom

abou $23 rillion down o $17 billion. The reason i doesn’

make sense o enac a more aggressive carbon ax is ha he

(marginal) harm o he convenional economy would exceed

he (marginal) environmenal benefi. There are several

policies in he able ha reduce environmenal damage

below he $17 rillion mark, bu hey hur he economy so

much more ha, on ne, hey are inerior approaches.I is undersandable ha noneconomiss would ail o

employ marginal analysis and would engage in overblown

rheoric when discussing somehing as conroversial as

climae-change policy. However, oo many proessional

economiss have also allen ino his bad habi, including no

jus Smih bu also Krugman and many ohers.

Robert P. Murphy (FEE.org/Murphy) is the senior economist

with the Institute for Energy Research.


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24 FEE.org

Caliornia’s gorgeous weaher has urned agains i as

he sae’s ourh year o drough drags on. Looming waer

shorages are leading o calls or raioning and resricions

on waer use. The sae has one year o waer lef—and

35-year megadroughs ahead o i. The New York Times

bleas, “Reservoirs are low. Landscapes are parched and

blighed wih fields o dead or dorman orange rees.”

Why is here a waer shorage? Almos every news sory

I’ve read blames he drough.

This sounds like a reasonable assumpion, bu jus

because he supply has conraced doesn’ mean ha here

should be a shorage. In normal markes, when supply

shrinks, he price rises, and quaniy demanded decreases

o mee quaniy supplied. People naurally use less whensomehing coss more. They conserve and prioriize.

Bu i, or some reason, he price can’t rise, usage won’

change because he price isn’ signaling acs abou under-

lying scarciy and incenivizing differen behavior. Wha

made sense o do wih a resource when i was relaively

abundan—say, 40-minue showers and urning your lawn

ino a lake—migh no make sense when waer is scarcer.

When he price is held down while supply and demand are

changing, you end up wih shorages, raioning, and regula-

ions on waer use.

As Alex Tabarrok poins ou a MarginalRevoluion.com,

Caliornia has pleny o waer. Wha i doesn’t have areprices—or raher, marke prices. Alhough a lo o well-meaning people insis ha waer is a right, I noice hamy “righ o waer” in no way changes he ac I have opay he governmen monopoly or i ($44.91 las monh).So even i here is a righ o waer, here is no nauralrigh o always pay hal a cen per gallon or i regardlesso supply or demand.

The price conrols and subsidies or waer use also have

behavioral consequences, Tabarrok wries:

As David Zetland points out in an excellent interview with

Russ Roberts, people in San Diego county use around 150 gallonsof water a day. Meanwhile in Sydney, Australia, with a roughly

comparable climate and standard of living, people use about half

that amount. Trust me, no one in Sydney is going thirsty.

People in San Diego have lawns and cars and pour ons

o waer on hem—and why no? I’s cheap. Bu when waer

becomes scarcer, raher han raise prices o reflec his ac

and encourage conservaion, Caliornia ciies resor o paer-

nalisic raioning, issuing edics abou when you can waer

your lawn and how much and how clean your car can be.

POLITICAL RAIN DANCE Does Caliornia Need Rain, Raioning, or Prices?

03 By Daniel Bier

GREEN ISSUE

Image credit: Robert Couse-Baker


27/52

FEE.org 25

SUMMER 2015


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26 FEE.org

“Waer conservaion” (by any means necessary—as long

as hey don’ involve prices) is also he basis or he myriad

ludicrous ederal regulaions ha have devasaed our oiles

and showers.

Prices aren’ jus a way o avoid shorages and use

resources efficienly, as Zeland explains in his wonderul,concise book Living with Water Scarcity. Markes rea

consumers like ree and responsible aduls whose choices

acually mater, raher han dicaing o hem wha’s

“imporan” or “essenial” or heir own lives. He wries,

Prices generate revenues and reduce demand, but they also give

customers choices. A regulation on outdoor watering may annoy a

granny with flowers. A desalination plant may annoy environmen-

talists. An education campaign is condescending to some and a

waste of breath on others. A campaign to install low-flow toilets

may install sparkling receptacles in unused second bathrooms.

Prices send a direct signal at the same time as they accommodate

many responses. Customers can choose their own mix of tech-

nologies and techniques. Some will take shorter showers. Others

will install drip irrigation. Some will shower at work. Others will

just pay more. A higher price for water, like a higher price for

any commodity, allows people to choose how much water to

use. Choice is a pleasant option compared to water shortages or

tickets from water cops.

Markes can solve he shorage in Caliornia even i hey

can’ make i rain, while waer raioning won’ do anyhing

o alleviae he real problem because i exemps he bigges

consumers. The use resricions are all a disracion—you couldeliminae all car washes, showers, and lawns and no make a

den, because urban consumers accoun or jus a racion o

Caliornia’s waer consumpion. The Economist noes,

The first rule for staying alive in a desert is not to pour the

contents of your water flask into the sand. Yet that, bizarrely,

is what the government has encouraged farmers to do in the

drought-afflicted south-west. Agriculture accounts for 80%

of water consumption in California, for example, but only 2% of

economic activity. Farmers flood the land to grow rice, alfalfa and

other thirsty crops. (emphasis added)

And while i may be sad ha some o Caliornia’s armsare sruggling, here is no good reason why he res o he

sae needs o suffer o subsidize crops (and inefficien irriga-

ion echniques) ha wouldn’ make economic sense i he

armers had o pay markes raes or waer.

Tabarrok calculaes ha i arms used jus 12.5 percen less

waer, Caliornians could heoreically increase he amoun

available or all indusrial and residenial uses by half.

Does ha arrangemen make sense? Probably no, bu

no planner or regulaor could possibly decide how o weigh

he demands o millions o people or waer or any scarce

resource. All we know is ha we do no have enough waer

o saisy every possible use or i.

Only he price sysem is able o coordinae hosecounless acors, acors, plans, ineress, and indusries.

Maybe when Caliornia regulaors urn on he ap and find

i empy hey’ll realize his.

Originally appearing on FEE.org’s new idea marketplace,

Anything Peaceful, this article was republished in Newsweek.

Daniel Bier (FEE.org/Bier) is FEE’s blog editor.

When water becomes scarcer,rather than raise prices to

reflect this fact and encourageconservation, California citiesresort to paternalistic rationing.


29/52

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Thomas Pikety, he “rock sar” French economis who

dominaed he news in lae 2014, is rying o backpedal on

he claims ha made him amous. While he sicks wih his

core argumens abou he naure o inequaliy, his recen

aricle in he American Economic Review (“Abou Capial

in he Tweny-Firs Cenury,” American Economic Review:

Papers & Proceedings 2015, 105[5]: 1–6) has been widely iner-

preed as a empering o he bold

the freeman - 2015 summer (green issue)

Documents