George Ought to Help

Posts tagged venus project

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On the non-existence of Human Needs

Everyone I know exposes themselves to an increased risk of death in order to satisfy other preferences they hold: Travelling by car, smoking, drinking alcohol, crossing the street, biking, going swimming, giving birth, eating food that hasn’t been pre-liquified to minimise the chance of choking, the list goes on.

Apparently most people do not place infinite value on extending their own life. If they did, their lives would look very different.

This being the case, it’s clear that for most people, those things that extend life are part of the same value scale as everything else; life-extending things compete with´╗┐ non-life-extending things in a single value scale. People choose what to do according to which option they expect to most closely satisfy their preferences at that moment.

So there’s no justification for treating life-extending goods and services as though they are qualitatively different to non-life-extending goods and services. Which is what Venus Project advocates (and most other people) do when they insist that ‘human needs’ are a different kind of thing to ‘human wants’.

Filed under venus project human needs wants subjective value economics david friedman

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Exchange with a ‘resource based economy’ advocate

A response to a Resource based economy/venus project advocate responding to my RBE vid on youtube. I’ll note in passing that I think capitalism is the ‘resource based economy’ par excellence, but these folks have a moneyless, centrally managed system in mind.

If a resource becomes more scarce, its price goes up, and more money is made by those who control that resource.

Don’t forget the corollary of this: as the price increases, more profit maximising firms are attracted to enter the business of providing this good. Assuming a state isn’t propping up a coercive monopoly on the good in question, new firms will make the good (or its substitutes) less scarce, and competition between them will drive its price down. This is how the market price mechanism rationally minimises scarcity, while taking into account society’s aggregate valuations of all potential uses of given resources —the price system makes this comparison/harmonisation and tendancy towards equilibrium possible.

By contrast, without the price mechanism, there would be no special reason (or at least much less of an incentive) for self-interested people to start competitively providing the scarce good to strangers. And the scarcity would persist.

"Money allows trade to happen". So it does, but an RBE is not looking to facilitate trade, just the fair and sustainable distribution of resources equitably to all the planet’s inhabitants.

Unless an RBE can perfectly match a persons (constantly changing) internal value scale to the scare material resources of the world, it’s very likely that people will benefit from trading, and so they will trade. The question is whether this trade will be easy or hard under an RBE order. Money makes it easy. See trade is made of win for more: http://www.youtube.com/watch?v=y0gGyeA-8C4

I think you also understimate the significance of profit/loss accounting. Money is not a perfect proxy for ‘what people value’, but I can’t imagine a better one, and nothing I’ve heard about the RBE proposals indicate to me that one is imagined there either. A profit (under free market conditions) can reasonably by interpreted as a sign that you’ve succeeded in combining resources that society, on aggregate values at X, into something that society values at >X. In other words profit means you’ve created value. Loss means you’ve destroyed value. This is crucially important because absent profit/loss, there’s no way (as far as I’m aware) to know whether your activities are destroying or creating value—and because there are many more ways to destroy than create value, the chances are good that that’s exactly what you’re doing as you fumble in the dark!

6a. “Surveys cannot take the dynamic nature of value scales into account.” Nor do they want to. The value of (say) an apple does not change because its price does.”

Value != price. The price of an apple may change, and the value of that apple to a potential buyer may change. When the value of that apple to him exceeds the value of the money he’d need to exchange for the apple, he’ll buy it. It’s not clear to me how surveys can take into account my constantly changing valuation of an apple (for instance), in determining how much of societies resources be dedicated to producing apples.

6b. “Surveys cannot feasibly take marginal utility into account”. Not really sure what marginal feasibilty is, but it is a term from economics. When I look in my fridge for tomatoes, I don’t take into account their marginal utility, because it isn’t relevant. “

Since you don’t yet know what marginal utility (not feasibility) is, you can’t credibly claim to know that it’s not relevant in this context (it is ;)). Here’s a video that explains it if i remember correctly: http://www.learnliberty.org/content/thinking-margin

I think this point illustrates and sums up the tenor of bitbutter’s position, which I think boils down to “RBE is incompatible with economics, and therefore is wrong”.

The most serious challenges to RBE proposals are derived from economic science. But the simplistic summary won’t do though. You need to understand the challenges in order to appreciate their weight and to begin to show why they might be mistaken.

The assumptions on which both are built have to be tested against real world actual physical facts and evidence, not against the assumptions of a though system like economics.

Empiricism is not always the best approach (especially when it comes to mass human action, which is inherently unfriendly to the control of variables) in these areas it loses out to praxeology (a primarily deductive approach that takes very humble empirical observations as its starting point). http://en.wikipedia.org/wiki/Praxeology

Filed under RBE venus project zeitgeist peter joseph jaque fresco