Common Sense about Names and about Descriptions

1 February 2016

The entry in Sibley’s Birds for Common Raven begins Uncommon.

This case illustrates the important distinction between names and descriptions. Common raven is a name; it was surely intended to be a name that worked as a description, but it presently fails as the latter while continuing to be the former.

A description can be usefully analyzed. It has components, each of which has independent meaning, and considering those meanings allows one better to understand the thing described.

A name as such is not analyzed; sometimes it might usefully be analyzed; sometimes it cannot be analyzed; sometimes analysis is misleading (as in common raven).

Often, what we call description is no more than naming. For example, if someone points to something and asks What is that?, and I say an urn, then all that I have really done is to provide a name, perhaps trusting the other person to know what urn means. On the other hand, if I say an ancient urn or a ceramic urn or an empty urn, then I have described it (though surely not as thoroughly as it might be described).

Notice that all description is constructed of names. The audience might subsequently ask for descriptions corresponding to names used, but eventually one reaches a point at which the names are of things that cannot be described (though alternative names might be offered).

Occasionally, I read something mocking someone for not understanding a description, such that a more perspicacious observer would recognize that the someone being mocked was treating the description as a name. This error may be no more foolish than wondering whether the common raven is a common bird.

Please Stand By

16 January 2016

The server on which this site is hosted is expected to be down for six hours, begining at 06:00 on 29 January UTC. (In parts of America, that interval begins in the night of 28 January.)

Value Doesn't Work that Way

12 January 2016

Many different conceptions of value are employed in different contexts, and more than one conception is employed in economics. But the notion of value that is most fundamental to economics is that of usefulness.

Usefulness isn’t some attribute independent of context, nor does anything have the same usefulness to one person as it does to another. When context changes, value changes. When a thing that had value is moved, it does not carry its value with it; rather, it takes-on a new value associated with its new context. When a thing that had value moves from being the property of one person to being the property of another, its old value is not delivered to the new person; rather, it takes-on a new value associated with its new ownership.

Prices represent a somewhat different sort of value. Prices are quasi-quantified prioritizations, under which things may be exchanged. But, however prices are formed, they work only to the extent that they promote any exchanges that are useful to those potentially making the exchanges, and discourage any that are not. Ostensible prices that do not do so will be ignored in markets, and bring-about economic failure in other systems of allocation. Market values — prices established by markets — are those that conform to the priorities of the parties who choose to exchange. Market values, though different from usefulness, must be informed by usefulness, and thus must thus reflect the contexts of the things priced.

Prices are first-and-foremost rankings, and treating them as quantifications has limited heuristic value; a thing may be rationally priced at $1000 without its being 1000 times as useful as something rationally priced at $1. And, though the first thing may be rationally priced at $1000 in some context, if the context is changed radically, the thing may cease to have any usefulness, so that its price should be 0.

A great deal of the wealth in to-day’s world is in the form of financial claims that have no meaning what-so-ever outside of the context of a market. If the market is eliminated, then these claims would have no usefulness and hence a rational price of 0. If the markets in which these claims might be used were somehow preserved, but the claims were seized and redistributed, then their new contexts would correspond to greatly diminished usefulness, and their rational prices would then be much smaller.

The great fallacy of popular notions that poor and middle-income people might be significantly enriched by a large-scale seizure and implicit or explicit redistribution of wealth from billionaires or from the 1% or whatever is the notion that the present prices of the seized wealth reflect an intrinsic economic property of the things seized, which property will be delivered with the things as they are transferred. Instead, the old value will evaporate, and the new value will often be 0.

This point is true even in cases in which the assets seized are not financial instruments. Imagine a community given a Lamborghini Diablo. It had more value than a Honda Fit to the millionaire who owned it; but, for the community, the Honda Fit could be more useful than a Lamborghini Diablo. The respective prices prior to redistribution were plainly poor reflections of what would be the values in the new context.

Wealth is destroyed not only when things of value are seized from the very wealthy and given to those less wealthy, but when there is any sort of large-scale redistribution; including that from the lower- and middle-income groups to the very wealthy. But further indiscriminate redistribution, as by income group, will not restore the wealth lost to past redistribution, and even in hypothetical cases in which only actual perpetrators are penalized and actual victims are compensated, there may be further loss of wealth as such.

So, no. There isn’t enough money for the dreams of the Occupation movement nor for the promises made by candidates such as Bernie Sanders, because money doesn’t work that way. And there isn’t enough wealth, because wealth doesn’t work that way. The accountings that claim otherwise are crack-pot.

Theatre of the Absurd

6 January 2016

It is often asserted that the current President runs a continuous campaign; that, even now, when he can no longer be reëlected nor get a Congress more to his liking before his Administration ends, he campaigns.

Well, more generally, his Administration has been theatre. The apparent campaigning is a manifestation of that. And to-day I read that he has produced a trailer for his up-coming State of the Union Address. A trailer. It makes perfect sense, because the Address is theatre. It has long been theatre, but he does theatre as did no President before him.

He’s been concerned to posture and to act in ways that he expects to be made to look good by to-day’s mainstream media and by that bloc of historians who decided, even before he took office, that they would depict his Administration favorably almost without regard to whatever he ended-up doing.

The recent climate accord, for which there was so much build-up and from which nothing came but loose and unenforceable promises, was theatre. The negotiations with Iran, in which many meetings were held to agree that the United States would throw up its hands (something that it could more simply have done unilaterally) were theatre.

Even the Affordable Care Act has become theatre. As costs spiral out of control it approaches its implosion, but it will be portrayed as a Noble Effort, ruined by Republicans and by the inherent wickedness of market forces.

And it was theatre when the man who has killed so many children with his drone strikes wept for the murdered children of Sandy Hook.

Theatre. The cost of the ticket is very high.

Money 101*

5 January 2016

The Nature and Origin of Money

[Read more.]

The Equation of Exchange and the Price Level

[Read more.]

The Inflationary Process

[Read more.]

Commodity-Based Money

[Read more.]

The Nationalization of Money and Fiat Money

[Read more.]

Partial-Reserve Issuance — the Charge of Fraud

[Read more.]

The Effects of Inequality in the Accumulation of Money

[Read more.]


* Years ago, when I had a 'blog at LiveJournal, one of my Friends there had started or was about to start taking an introductory course on macrœconomics. I banged-out an entry from which this one is derived.

Crime and Punishment

31 December 2015

My attention was drawn this morning to What Was Gary Becker's Biggest Mistake? by Alex Tabarrok, an article published at Marginal Revolution back in mid-September.

Anyone who’s read my paper on indecision should understand that I reject the proposition that a quantification may be fit to the structure of preferences. I’m currently doing work that explores the idea (previously investigated by Keynes and by Koopman) of plausibility orderings to which quantifications cannot be fit. I’m not a supporter of the theory that human behavior is well-modelled as subjective expected-utility maximization, which is a guiding theory of mainstream economics. None-the-less, I am appalled by the ham-handed attacks on this theory by people who don’t understand this very simple model. Tabarrok is amongst these attackers.

Let me try to explain the model. Each choice that a person might make is not really of an outcome; it is of an action, with multiple possible outcomes. We want these outcomes understood as states of the world, because the value of things is determined by their contexts. Perhaps more than one action might share possible outcomes, but typically the probability of a given outcome varies based upon which action we choose. So far, this should be quite uncontroversial. (Comment if you want to controvert.) A model of expected-utility maximization assumes that we can quantify the probability, and that there is a utility function u() that takes outcomes as its argument, and returns a quantified valuation (under the preferences of the person modelled) of that outcome. Subjective expected-utility maximization takes the probabilities in question to be judgments by the person modelled, rather than something purely objective. The expected utility of a given action a is the probability-weighted sum of the utility values of its possible outcomes; that is p1(au(o1) + p2(au(o2) + … + pn(au(on) where there are n possible outcomes (across all actions), oi is the i-th possible outcome (from any action) and pi(a) is the probability of that outcome given action a.[1] (When oj is impossible under a, pj(a) = 0. Were there really some action whose outcome was fully determinate, then all of the probabilites for other outcomes would be 0.) For some alternative action b the expected utility would be p1(bu(o1) + p2(bu(o2) + … + pn(bu(on) and so forth. Expected-utility maximization is choosing that action with the highest expected utility.

Becker applied this model to dealing with crime. Becker argued that punishments could be escalated to reduce crime, until potential criminals implicitly regarded the expected utility of criminal action to be inferior to that of non-criminal action. If this is true, then when two otherwise similar crimes have different perceived rates of apprehension and conviction, the commission rate of the crime with the lower rate of apprehension and conviction can be lowered to that of the other crime by making its punishment worse. In other words, graver punishments can be substituted for higher perceived rates of apprehension and conviction, and for things that affect (or effect) the way in which people value successful commission of crime.

The simplest model of a utility function is one in which utility itself increases linearly with a quantitative description of the outcome. So, for example, a person with $2 million dollars might be said to experience twice the utility of a person with $1 million dollars. Possession of such a utility function is known as risk-neutrality. For purposes of exposition, Becker explains his theory with reference to risk-neutral people. That doesn’t mean that he believed that people truly are risk neutral. Tabarrok quotes a passage in which Becker explains himself by explicit reference to risk-neutrality, but Tabarrok misses the significance — because Tabarrok does not really understand the model, and confuses risk-neutrality with rationality — and proceeds as if Becker’s claim hangs on a proposition that people are risk-neutral. It doesn’t.

Becker’s real thought doesn’t even depend upon all those mathematical assumptions that allow the application of arithmetic to the issue. The real thought is simply that, for any contemplated rates of crime, we can escalate punishments to some point at which, even with very low rates of apprehension and conviction, commission will be driven below the contemplated rate. The model of people as maximizers of expected utility is here essentially a heuristic, to help us understand the active absurdity of the once fashionable claim that potential criminals are indifferent to incentives.

However, as a community shifts to relying upon punishment from relying upon other things (better policing, aid to children in developing enlightened self-interest, efforts at rehabilitation of criminals), the punishments must become increasingly … awful. And that is the moral reason that we are damned if we simply proceed as Becker said that we hypothetically could. A society of monsters licenses itself to do horrific things to people by lowering its commitment to other means of reducing crime.


[1] Another way of writing pi(a) would be prob(oi|a). We could write ui for u(oi) to and express the expected utility as p1(au1 + p2(au2 + … + pn(aun but it’s important here to be aware of the utility function as such.

Bear

26 December 2015

When I was between my ninth and tenth birthday anniversaries, my father was transferred to an island in the middle of the Pacific;* my family went with him.

I was instructed to put the things that I wanted to go to the island in one box, and things to go into storage into another. I put my teddy bear into what I thought were the box for the island.

When we got to the island, the teddy bear was not amongst the things delivered there. I was very sorry to think that I’d put it in the wrong box, and that I would not see it until we moved back to America.

Two and two-thirds years later, we left the island. I was then twelve years old, but I looked forward to getting my teddy bear back.

Only, it wasn’t in storage.

I’d put it in the box to go to the island. One of my parents thought it unsuitable for a boy of my age to still want a teddy bear. So my bear had been discarded.


*Kwajalein Island, in the Kwajalein Atoll, in the Republic of the Marshall Islands, in Micronesia.

What Does the Goldsmith Use for Money?

10 December 2015

Irked by an up-tick in nonsense about money, I decided to haul-out a piece that I’d written years ago on some of the basics of monetary theory — Money 101 as it were — rework some of the old sections, and add some material motivated by new annoyances. I would then post it here.

But, in the course of working on that entry, I was confronted by a problem of that theory. I didn’t and don’t want just to ignore it, but the Money 101 entry is already rather long. So I decided that I should write a separate entry on the problem.

Part of the difficulty in writing this separate entry is that the problem vanishes if one makes some of the ordinary presumptions of neo-classical economics. I feel that I need to explain why those presumptions should not be made. But, given my audience, I feel that I need to explain the presumptions themselves. This entry may seem still more awkward than usual, as I try not to make it too abstruse.

You’d be quite correct in thinking that this entry could be much better written than it is — if I’d put more time and effort into its composition. But I want to do other things, and don’t want this entry to be yet another piece on a back-burner.


Money is a medium of exchange. That is to say that people obtain some amount of it by exchange for the purpose of yet further exchange. It contrasts with things manufactured by them for exchange, and with things obtained for use other than in further exchange. Money arises whenever someone is clever enough to accept more of a commodity than he or she would otherwise want (at the given rate of exchange), and uses it in a further trade. What we ordinarily recognize as money is whatever money has become standard in the exchanges that we observe, but any commodity obtained in one exchange, with the intention of being exchanged yet again, and then indeed thus traded, was money.

Historically, commodity money is routinely followed by commodity-based money, with promissory notes circulating as money. There may at first seem to be no real difference between commodity money and commodity-based money, but fractional-reserve banking actually makes that difference very real, with the promises exceeding the stock of the commodity held to meet those promises, so that the amount of money exceeds the stock of the commodity. And, following upon the introduction of commodity-based money, we observe the introduction of fiat money, where notes that make no promises somehow circulate as money.[1]

Economists — not merely advocates of commodity money or of commodity-based money, but economists more widely — have a great difficulty in explaining why fiat money should have any value in a market economy. We can say a great deal about what prices must obtain if people use some given stock of notes as money for exchanges of some given set of stocks or flows of commodities, and have some given available technologies for transferring these notes, but it seems that we cannot fully explain why people agree to make these exchanges using this money, and hence we cannot explain the value of this money.

On the other hand, most economists seem to be comfortable in the explanation of commodity money and of commodity-based money. It is claimed to be the value of the commodity in non-monetary use. That is to say that to explain the value, for example, of an American silver dollar, one would find the persons who wanted to smith the silver or use it for wiring or somesuch, and see what commodities they would and could offer for that amount of silver. (To express the value in other commodities, one would have to follow a chain of offered exchanges.)

However, this explanation of the value of commodity money and of commodity-based money cannot account for the full value of an indefinitely circulating money.


Before continuing the principal discussion, I want to critique some features of neo-classical economics — the mainstream of micrœconomic theory.[2]

Neo-classical economics proceeds almost entirely within a framework of limiting cases; even when a neo-classical theorist makes a move towards greater reälism with respect to some aspect of the framework, most of the rest of the theorizing retains the familiar limiting-case features. The use of these limiting cases often produces models that are defensible on instrumentalist grounds, but certainly not when they cause whatever is the problem principally under consideration simply to leave sight.

In the case of the problem here to be raised, three of the standard presumptions of neo-classical economics that are objectionable are:

  • that preferences are complete
  • that goods and services are continuously divisible
  • that small costs may simply be ignored

The idea that preferences are complete is that, for absolutely every two potential choices, either a person thinks that one is better than the other, or the person thinks that they are, effectively, equally good. Cases in which people instead behave in some meaningfully different way both from treating the one as better than the other and from treating the two as equally good (or equally bad) are disallowed. I’ve attacked the literal truth of completeness elsewhere.

The idea that goods and services are continuously divisible might be attacked on the basis of physical theory — what we know of the properties of matter. But, before we pick such nits, I think that we ought to concern ourselves with how finely the human mind actually divides things. Even the folk who carefully eye bottles of water, seeking to determine which is most full, don’t get below a particular resolution. And if perfectly accurate and precise measures were always available, then we’d be lost beyond some number of digits to the right of the decimal point.[3] (Our limitations in this regard are entangled with the costs of resolution, which might bring us to the issue of small costs being ignored, except that the costs of ever finer resolution can sky-rocket!)

I don’t think that the presumption that small costs may simply be ignored needs much explanation. But note that it can sometimes directly contradict the presumption of completeness of preferences! A cost corresponds to forgone goods or services, and small costs are small variations in the goods or services that one might have had.

I believe that in many other cases, these three presumptions are not a matter of great concern, though they are objectionable in explanation of the value of a money that is a commodity or is based upon a commodity. But there’s a fourth presumption that is relevant and that I do not think is ever justified. Specifically

  • that, when an agent is otherwise indifferent amongst choices, he or she makes that choice which would be required for the theory to work

That is to say that not only does Buridan’s ass choose one of the bails of hay but, if theory won’t work unless he chooses the left bail in particular, then he just does. The weaker presumption, that an indifferent agent (person or donkey) will choose, is usually based on a theory that the agent can and will flip a coin, but the idea that the agent will flip a coin contradicts expected utility theory, the mainstream of the theory of choice under risk. The stronger presumption that the agent will necessarily just happen to choose whatever is needed for the rest of the theory to work is incoherent.


In some contexts, most people understand that, for any person to agree to an exchange, he or she must expect to be better-off if the exchange takes place than if it does not. Most people lose sight of that point in a variety of contexts; some screw their eyes shut so as not to see it. Under the presumptions of neo-classical economics, it can be made to disappear.

Imagine that Ann has some quantity of blackberries, and Bob has some quantity of strawberries, and that Ann would rather have the strawberries that Bob has, and that Bob would rather have the blackberries that Ann has, and that they each feel this way even accounting for the costs of arranging and effecting a trade. In the real world, the trade will take place; and in the neo-classical world the trade will take place. Chances are, the trade would take place even if Ann were offering a slightly smaller quantity of blackberries while Bob offered the same amount of strawberries. In the real world, if we decrease the quantity of blackberries below some point, Bob may still think that the blackberries would have been worth it, except for the hassle of negotiation and transfer; in the neo-classical world, that hassle is usually considered small enough to ignore. So we leave reality behind, and can keep paring-back the offered amount of blackberries. We can do so with infinite precision, because blackberries are imagined to be continuously divisible, and because Bob is imagined to have complete preferences. Eventually, we reach the point at which the offered amount of blackberries is worth exactly as much to Bob as the strawberries that he has. But, at every place up to that point, he would agree to a trade; to put that in mathematical jargon, so long as there is any ε (no matter how tiny) of blackberries greater than the amount at which he is indifferent, neo-classical Bob will make the trade. So the claim is that, at the limit, he will still make the trade, even though he has nothing to gain. Mind you that this is a limit approached from one side. If the epsilons were all short-falls, rather that surpluses, then Bob would have been refusing right up to the limit. Still, neo-classical Bob might work well enough as a model for real-world Bob if short-falls just never occur for him. If they do, it would be quite terrible to claim that the behavior to one side of the limit (by even an ε) is the behavior when approached from the other side, and that Bob both trades and refuses to trade at the limit, or trades both ways (strawberries for blackberries or blackberries for strawberries) at the limit.[4]

The value of an additional amount, more or less, of strawberries or of blackberries relative to other possible changes, doesn’t typically stay the same. In particular, as one has ever more of something, one would increasingly find more of something else relatively more useful; and as one has ever less of something, one would increasingly find more of something else less useful.[5] As a result, under the presumptions of neo-classical economics, one could expect that, by playing with the amounts of blackberries that Ann has, and the amount of strawberries that Bob has, one could produce a situation in which each valued what they had equal to what the other had. Given these presumptions, as soon as Ann and Bob have made a trade, they might be willing to make the inverting trade, so that they end-up where they were! And I’ve seen models in which it is implicit that just this sort of thing happens!


So long as we understand these assumptions as producing imperfect instruments, they may have great value. Newtonian physics has been empirically falsified, and never really held together, but it works fine not merely for much technology, but for investigating the basic answer to various scientific questions. Likewise for some applications of neo-classical economics. But one must not confuse artefacts of counter-factual assumptions with actual answers to whatever questions are at hand.


Imagine three people, Aya, Gus, and Tor. Aya has a pepper but wants strawberries; Gus has strawberries but wants okra; Tor has okra but wants a pepper.

Agent has wants
Aya pepper strawberries
Gus strawberries okra
Tor okra pepper

Aya can get what she really wants by using okra as a medium of exchange (trading the pepper for okra and then the okra for strawberries); or Gus can get what he wants by using the pepper as a medium of exchange (trading the strawberries for the pepper and then the pepper for okra); or Tor can get what he wants by using the strawberries as a medium of exchange (trading the okra for the strawberries and then the strawberries for the pepper).

But if the only potential use that Aya has for the okra is as a medium of exchange, and likewise for Gus with the pepper and for Tor with the strawberries, then it will not make sense for Aya to use the strawberries as a medium of exchange, for Gus to use okra as a medium of exchange, nor for Tor to use the pepper as a medium of exchange. No matter what is used as money, the person responsible for it having value in exchange is also a sink for the money; once it is in his or her hands, it will cease to circulate as money.

One might imagine a larger community, in which the money had to pass through more hands to reach a sink. But the reasoning that launched the money was based upon its value to a person who would be a sink. If the money could not be expected to reach a sink, it could not be expected to reach the person who gave it value. It seems that it must go to a sink to be money.

My model of Aya, Gus, and Tor has only persons each of whom places no value on the item for which he or she could initially trade, except as a medium of exchange; and the trades considered are those in which each person gives all of his or her stock. We can imagine an economy with a large number of people, many or all of whom place some value on various or all of the sorts of commodities that might be used as money. We may presume that some goods and services are possessed by more than one person and that some goods and services are sought by more than one person. For various potential transactions, we might suppose competition both amongst those seeking the monetary commodity (for use as money or for non-monetary use) and amongst those offering the monetary commodity to them. We may conceive that many stocks of goods and of services are divisible.

When stocks of a commodity are divisible it becomes possible (and sometimes necessary) to put some portion to one use and the remainder into another use or into other uses. Various portions may be traded with various persons, and some may be put to use other than in exchange; and these different sorts of allocation of different portions may make sense because (as said earlier) as one has ever more of something, one would increasingly find more of something else relatively more useful; and as one has ever less of something, one would increasingly find more of something else less useful. It certainly becomes conceivable for some people to acquire both stocks of the monetary commodity for use as money and stocks for non-monetary use.

But, even with these added complications, it seems that the persons responsible for the monetary commodity having value in exchange are also sinks for the money; once it is in their hands, it will cease to circulate as money.

Whatever may be their priorities, rational people make only trades that they regard as improving expectations, and do not forgo greater such improvements for lesser improvements. In a neo-classical framework, that improvement might be imagined to be 0, the ghost of a departed ε, but in the real world it must be more than that. Trading with the monetary commodity is no exception to the rule that rational people do not trade unless they expect their priorities to be best served by the trade.

If a person wants a positive amount of the monetary commodity for use in trade, that means that (given his or her priorities) the anticipated value of the use of that portion as money exceeds the anticipated value of that portion in other use; it must be expected that someone will give give something worth more than that other use. We may then consider that next person. Either he or she will put the whole to non-monetary use, removing it from circulation as money, or will reserve some for monetary use. But we cannot indefinitely pass the buck if we are explaining the value of the monetary commodity by its non-monetary use. Eventually, either all of the commodity will have been removed from monetary use, or we will be back to someone whose position has already been considered. If money circulates indefinitely then it must for all participants have a greater value than they place on its non-monetary use!

My understanding of the relevant history is more limited than that of some people, but I think that some commodity money and commodity-based money has enjoyed enough circulation to indicate or at least to suggest that it might well circulate forever, that its value as money is not fully explained by its value in non-monetary use. [Addendum (2015:12/13): The recurring practice of fractional-reserve banking is only sustainable if money circulates indefinitely. Some opponents of the practice may insist that it is unsustainable; but, in any case, the monetary commodity must be fairly far removed from a sink for fractional-reserve banking to work at all, and frequent observation of fractional-reserve banking suggests that money indeed circulates indefinitely.]

If that is correct, then we want to explain the additional value. And, quite possibly, we might find in such an explanation something that will help us to explain the value of fiat money.


[1] At least passing mention should be made of the point that, if what appears to be fiat money is legal tender and there are price controls, then the money may be considered to be backed by the price-controlled commodites, or perhaps by the punishment delivered to those who fail to produce the commodities at those prices when the money is presented.

[2] There is no objection to marginalism here. Although both neo-classical economists and opponents of marginalism often treat them as if conterminous, they are not.

[3] With limited bearing on the problem of money, but of potential interest in other contexts, there is an additional issue of divisibility for commodities that are not simply measures of a substance, of space, or of time. Dividing something such as a car in two is not like dividing water into two containers. If for every proposed fractionalization (a half, a third, a fourth, &c) we could somehow find or construct some car which under natural descriptions had that fraction of each feature of another car (half as much leg-room, half as much cargo space, &c) and such that all persons regarded the corresponding multiplicity of these lesser cars as equivalent to one of the larger cars, then we might have a case for a sort of divisibility. But those conditions cannot be met.

[4] It would be then as if one claimed that, within a range from 0 to π, tan(π/2) were variously positive and negative simply whenever that makes a theory work.

[5] This is the actual law of diminishing marginal utility, though neo-classical economics gets lost in a special case of the principle.

Class Time

3 December 2015

At a site whose content seems intended to entertain, I read of a teacher who is said to have challenged his or her students to explain time and to define time. The words explain and define are treated in the narrative as if referring to the same task, which suggests something about the sort of answer sought. None of the students succeeded in doing what the teacher asked.

While we might perhaps have different conceptions of time, the essential concept of time is not one that we assemble from and with other concepts. Time is fundamental in our experience. Thus, when we seek to define time, the best that we can do is to find synonyms that might seem to put us into loops. For example, The Oxford Shorter English Dictionary defines time with duration, and duration with time. But to define a term is to coördinate it with a concept; so either definition actually works just fine as a definition, on the assumption that we have a concept for the complementary term.

Definitions often involve conveying a concept by showing how to assemble it from and with other concepts; that is perhaps what one expects when asked to explain a concept or a word. But disassemblies that somehow never reached an end would never reach a concept. We must at some stage somehow point to a concept without further use of definition. In the case of time, we have reached a concept that we cannot disassemble; in the case of time, we have found a word for which we can find only either simple synonyms or assemblies in which its concept lurks undisintegrated, even if unrecognized.

Slavery, Slavery, and the Political Left

2 November 2015

While the word slavery gets used in many ways, its core meaning is that of a personal condition of being property of another person or of a group of persons

However, there are recurring attempts to redefine slavery, insisting that a person who reaped only subsistence from his or her labor were by definition a slave. Now, this proposed definition is really orthogonal to any proper definition.

  • On the one hand, a person only reaps subsistence when living with a minimal technological infrastructure in a world of markèd scarcity. Much of humankind for most of history lived with little or no production above surplus, regardless of whether someone else were making ownership claims against them.
  • In some cases, people have had lives of relative material comfort, and yet would have been tortured or killed by their masters had they sought different employment.

(Compounding the problem with the redefinition, people who are consuming commodities far in excess of their needs for survival like to redefine subsist to include various comforts, such as electronic entertainment.)

Perhaps most of the people who abuse the world slave in this manner do so thoughtlessly; but it ties-together with an aspect of left-wing thought to afford them a significant evasion, deceiving others and deceiving themselves. That aspect is a resistence to acknowledging a relationship between wage-rates and the amount of labor employed in an economy.

One sees this failure in present support for an increase in statutory minimum wages. What these laws really say, to put things quite simply — yet perfectly truthfully — is that if an employer or would-be employer is unwilling or unable to employ a worker at or above the statutory minimum, then the employer must fire the worker, or not hire the worker in the first place. Most advocates presume that the employer will neither fire nor refrain from hiring, as if demand for labor were perfectly inflexible.

A rather pure expression of this dissociation of wage-rates from labor employment is found in the economic model of Piero Sraffa.[1] Sraffa’s work is utterly unknown to most lay-people, and unfamiliar to most economists, but to economists on the far left it is an important benchmark, exactly because it claims so much of what they want to claim. However, its persuasive success is largely a matter of subscribers failing to note or to acknowledge a great deal implicit in the model. Perhaps most remarkably, in his model, the very same amount of labor is produced and consumed with absolute disregard for the wage-rate. That is to say that workers deliver the same labor (imagined as a scalar quantity) whether they are offered literally nothing in return (not even subsistence), or all of production is given to them as wages (with the same wage-rate for each worker).

When I look at the Sraffan model, I see workers behaving as if they are slaves. When their wages provide them no more than sustenance, they are as miserable slaves; when their wages provide them less than sustenance, they are as dying slaves; when their wages provide them far more than sustenance, they are as materially comfortable slaves. What makes them seem to be slaves is that they never exercise, and thus appear not to have, any freedom of choice in where they work nor in how hard they work.

(In those states of the United States that allowed private ownership of slaves, slaves were expected to deliver some fixed quota to their owners. They were not typically offered rewards for exceeding these quotas; they were punished, sometimes horrifically, for failing to meet them. I know of no other way, in the real word, to get the sort of labor production that Sraffa describes.)

In Sraffa’s model, whatever production does not go to workers, goes to the owners of the other productive resources — essentially to the capitalists.[2] If one embraces Sraffa’s model or something very much like it, and if one waves-away the proper meaning of slavery and instead uses it to mean one who is paid no more than sustenance, then it is easy to insist that, in a system that most favors a distinct class of capitalists, workers would be slaves, whereäs alternatives decreasingly favorable to such capitalists move workers ever further away from slavery. And if one imagines the workers getting an ever greater share exactly as production is administrated on behalf of the worker, then the movement away from slavery is a movement towards socialism.

However, if one continues to accept a model along the lines of Sraffa, yet restores the proper meaning of slavery, then one begins to see one why it had been doubly convenient to redefine the term. Because, in imagining a world in which workers never, one way or another, exercise freedom of choice in labor regardless of how production is distributed, the left has come perilously close to suggesting that workers, under socialism, would be slaves.

The underlying truth is that labor is one of the means of production. If an economy is fully socialized, then the potential worker must be employed however and wherever the best interests of the community as a whole are served, and his or her interests count no more in this decision than do those of anyone else.

This grim principle has repeatedly been illustrated in communities that have attempted a very high degree of socialism. Sometimes the attempt has been hijacked by leaders with less that sincere interest in communal well-being, but these leaders were able to make the populace their slaves because socialism required slavery of the populace. Trotsky’s observation that

The old principle: who does not work shall not eat, has been replaced with a new one: who does not obey shall not eat.[3]

was true under Stalin because it or something like it would, as a practical matter, have been true under any fully realized socialism.

Meanwhile, as much as many people living in more market-oriented economies like to imagine themselves as slaves to their employers, they’re fully aware that these employers cannot send agents to recapture them should they quit their jobs. To the extent that any group of persons other than ourselves exercises such ownership over us, that group is the state — the very institution usually entrusted to effect socialistic measures.

A movement towards socialism is a movement towards slavery, rather than away from it, and if one is going to bring the subject of slavery into an honest defense of socialism against all alternatives, then it is necessary somehow to make a case for slavery.


[1] The Production of Commodities by Commodities; Prelude to a Critique of Economic Theory (1960).

[2] Note how advocates of higher statutory minimum wages point with outrage at those who amass great wealth while paying workers less that some proposed statutory minimum wage, as if there were a zero-sum game being played between employer and employee.

[3] The Revolution Betrayed, ch 11 Whither the Soviet Union? § 2 The Struggle of the Bureaucracy with the Class Enemy.