Aristotle on Mixed Economies


This is an article I wrote some time ago for the Ludwig von Mises Institute.

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A friend recently commented that he has found wisdom in moderation. He said it seems that truth and goodness are found not at the extremes, but at the place of balance between extremes. This can be very true.

As Aristotle wrote in his Nicomachean Ethics, "Virtue must have the quality of aiming at the intermediate." In Aristotle's examples, it is cowardice and recklessness that are the extremes, courage the middle ground. It is drunkenness and uptightness that are extremes, and moderate drinking the mean.

My friend went on from this concept to state that he believed in neither socialism nor capitalism, but in a mixed economy — or what he called a "messy middle ground." There are two main problems with this conclusion.

The first is that statements like this in the abstract are meaningless. To construct a pretend spectrum, and place various actions and beliefs on it and then to choose the "middle" between them does not give meaning to that middle in and of itself. That is, without actual arguments and definitions regarding what that middle choice or belief is, it is simply a made up point on an imaginary spectrum on which other ideas are arbitrarily placed. Using this logic, I could claim that, since the mean is always good, green beans and omelets are both extremes and I prefer the middle ground.

Most often, those advocating an idea simply because it is in the "middle" of their mentally constructed spectrum do so because they lack any real arguments about the idea itself. For the idea of a middle ground or moderation to have any meaning, the extremes must first be defined and understood as opposite responses to a common problem, and must be placed on an ordinal value spectrum, such as a standard of basic morality that always holds falsehood as bad and truth as good.

The second problem with the conclusion that, since even Aristotle recognized moderation as the source of virtue, a mixed economy is better than capitalism or socialism is that it departs from the logic used in the earlier examples of courage and moderate drinking.

Courage and moderate drinking were the mean because either an excess or a deficiency was problematic. However, both courage and moderate drinking are extremes in another sense. Courage is a word that describes the good state of mind in the face of danger. There is no case in which courage itself is bad or not to be desired, since it is by definition the proper balance between cowardice and recklessness — you cannot have too much courage, nor too little, only too much fear or too little. There is either courage or noncourage (cowardice, recklessness), just as there is either truth or falsehood. In this sense it is an extreme.

Perhaps this sounds like a simple matter of definitional difference. There is, however, a fundamental difference here, meant to show that moderation is only good if it is moderating between two bad extremes and to a good mean, and not if it is moderating between a good and a bad. As Aristotle put it:

But not every action nor every passion admits of a mean; for some have names that already imply badness, e.g., spite, shamelessness, envy, and in the case of actions adultery, theft, murder; for all of these and suchlike things imply by their names that they are themselves bad, and not the excess or deficiencies of them. It is not possible, then, ever to be right with regard to them; one must always be wrong.

The midpoint between murder and nonmurder is not the good choice — nonmurder is. However, the moderation between not caring a lick about the actions of another and caring so much you would use violence to control them is a good middle ground — but this middle ground is not to be confused with socialism.

Socialism is a system where government uses force to tell people what decisions they can and cannot make. There may be degrees of freedom within different socialist systems, just as a prisoner may be treated better or worse by different wardens, but if you are not free, you are not free.

Capitalism is an economic system that allows people to make choices free from government intervention. All government intervention is backed by the threat of violence — if it were not, it would not be a government policy, but rather a voluntary recommendation, or a rule of a voluntary association. The fact that one cannot avoid taxation and obedience to a government without physical consequences proves that it is not a voluntary institution, but rather one backed by force.

Advocating a "mixed economy" or a middle ground between socialism and capitalism is nothing more than advocating a middle ground between threatening your neighbor with violence if he doesn't do your will and not threatening him with violence. If he resists, it becomes the same as the "middle ground" between murdering and not murdering. In that sense, capitalism is an extreme, just as courage is an extreme against noncourage.

In another sense, there is a middle ground economically. The middle ground is between caring so much about the economic decisions people make that you would threaten them with murder to control them, and caring so little that you would allow them to harm themselves or others. By definition, you cannot escape the second extreme by application of the first. You cannot care about individuals by threatening them with violence. Such care must come peacefully and voluntarily: by persuasion, not force.

The middle ground in this case is not socialism — or control by threat of violence — but a capitalist system in which individuals voluntarily look out for one another, and peacefully persuade others to look out for themselves and others. Capitalism is not a virtue in the way that courage is a virtue; it is rather a framework that avoids the extreme of violent coercion. Avoiding the one extreme, as a capitalist system does, does not guarantee avoidance of the other extreme, just as not being reckless does not guarantee you will be courageous. But again, avoiding the extreme of neglecting others cannot be achieved by embracing the extreme of coercing them.

The true middle ground is to accept a capitalist system — i.e., avoid the extreme of coercion — and choose personally to care for and about others, and persuade them to do the same — i.e., avoid the extreme of neglect. Since caring for others is a highly subjective, individual concept, no form of coercive economic arrangement can bring it about; one can only allow it to occur.

In one sense capitalism is an extreme in that it is the opposite of coercion. In another sense, capitalism is simply a system that allows individuals to choose the middle ground between coercion and neglect. Socialism, on the other hand, is an extreme in both cases; it is the opposite of freedom and it is not a middle ground between coercion and neglect; it is itself coercion.

Attempting to find a middle ground between coercion and freedom is a bad idea.

Finding a middle ground between coercion and neglect is a good one.

Capitalism is the only system that allows for both of these. We should not stop advocating capitalism, nor should we stop caring about ourselves and others in peaceful, voluntary ways.

I find it no less disturbing when someone says both capitalism and socialism are extreme and they seek a middle ground than if someone were to say both love and cruelty were extreme, and they therefore seek a middle ground. Some vices or virtues are found in moderation; some are found in absoluteness. As Barry Goldwater famously said,

Extremism in the defense of liberty is no vice! — Moderation in the pursuit of justice is no virtue.

Capitalism is just. Socialism is unjust. There is no "messy middle."

Christianity and Freedom


Is there a dichotomy between law and love?

After reading an article I wrote (Palm Sunday and Politics), a friend of mine told me he thought I espoused a sort of dualistic view of Christian life.  As if Christ came only to preach a spiritual transformation as something entirely separate from physical life.

Upon a rereading of the article, I can see how one might draw that conclusion.  That is not, however, what I meant to communicate.  Indeed, I view life as holistic, with all elements – spiritual, emotional, mental, physical – inextricably intertwined.  I view the Christian life as wholly transformative, of the spiritual life as well as the others listed above.  I do not see a dichotomy between the spiritual and physical life as far as my Christianity is concerned.

That said, there was a dualism expressed in the post.  It was not a dichotomy between the spiritual and physical life, but a dichotomy between peace and force - and by force I am referring to the initiation of physical violence, or the threat of it.

The things I believe as a Christian affect every aspect of my life.  My goals in life spring from my theistic view of the world and the resulting actions that view brings.  Things like caring for those in need, learning humility, showing love and offering freedom to others--these are goals because of my acceptance of the Kingdom Jesus preached.

These beliefs and duties are physical as much as anything else.  What they are not is violent.

To attempt to achieve these goals by initiating force against others is antithetical to the ends themselves.  Though physical force may be justified in some instances (such as self-defense, though Christ and many others refrained even from this and chose martyrdom), I do not see any way in which the initiation of violence can be seen as a moral way to advance the work of Christ.  When Jesus taught kindness to the poor, do you think he meant it by first doing violence to the rich or middle class?  When he taught righteousness, do you think he meant making others righteous on threat of fine or imprisonment?

I do not.

If we do not feel justified in using force to advance these goals individually, why should we feel justified doing it as a group, or hiring it out to others?

Everything government does is done by force.  If it’s a new law or regulation, it is backed by threat of fine, imprisonment, or (if you are persistent enough in resisting) force to the point of death.  If it is a welfare program, it is funded by tax dollars, which are not given voluntarily.  Try not paying your taxes long enough and you’ll find that indeed, force is what’s ultimately behind tax collection.  If it were not, funds would be collected by a voluntary association, not government.  Government has nothing to give but that which it first takes, and it takes by force or the threat of it.

If you’ve accepted the Christian life, it should indeed transform your entire being and all your actions.  Far from believing Christ’s example and words regarding righteousness or care for the poor to be merely spiritual commands, I see them as part of the holistic goal of His kingdom, and involving physical actions.  However, I do not see these ends as a justification for violent means.

To attempt to use government to achieve Christian goals is to, ultimately, use physical force.  This not only corrupts government, it corrupts the goals themselves and diminishes the true depth of the work of the Kingdom.  It reduces a life-transforming message delivered by loving believers into a program for political preferences pushed by a religious interest group.

Oh, and it just so happens that the way human nature works, peaceful and voluntary means of helping the poor and promoting moral behavior achieve unimaginably more than any force-backed government initiative ever can.  The genius of creation is manifest in economics – free individuals acting to prosper individually achieve more for their fellow man than mandatory efforts.  What is moral, it turns out, is also very efficient.

Christians should not only daily examine their hearts to see if their goals and actions are in line with the ultimate Truth; they should also ask themselves if the means they are using to accomplish those goals are righteous.  Sometimes a government program would be easier than doing the work of Christ ourselves, or organizing voluntary efforts.  Then again, Christ never said it would be easy.

Palm Sunday and Politics


When He approached Jerusalem, He saw the city and wept over it, saying, "If you had known in this day, even you, the things which make for peace! But now they have been hidden from your eyes." Luke 19:41–42

As Jesus entered Jerusalem on Palm Sunday to shouts of, "Hosanna" and cloaks and palm branches thrown on the road before him, it seems it must have been a joyful experience. But instead of taking joy in the cheers of the people, Jesus wept over the city.

I’m no Biblical scholar or Jewish historian, but what little I’ve studied of the Bible and the history of the time suggests that the kind of savior the people expected was not the kind Jesus came to be. And for their misplaced hopes, he felt pain.

When Jesus came into the city that day the people gathered to see him and many began to think he may be the Messiah that had been promised the Jews for hundreds of years. They were under the control of the Roman Empire and its various local puppet governments. Understandably, when the Jews learned the promises of a savior and King in the line of their great king David, they expected a Messiah who would free them from Roman rule.

When Jesus entered the city they waved Palm Branches and shouted, "Hosanna." History suggests these were significant, even dangerous political gestures. Hosanna was a Hebrew word that meant, "Save, now!" and had a very physical connotation. It was not at that time a cry of spiritual or abstract salvation, but a very real shout for physical salvation, which had specific meaning to a people under Roman rule. The Palm branch was a nationalistic symbol for the Jews, a symbol that had appeared on the last coins made when Israel was free. That is perhaps why the Pharisees told Jesus to "rebuke" his disciples – because to openly praise one they thought came to defy their rulers was politically dangerous.

As the crowd of people saw Jesus entering the city, they saw a political savior; one who might at last rise up and free them from the Romans, and they cheered His arrival. But He wept. He wept because they did not know, "The things which make for peace." He had not come to free them from physical bondage.

Jesus did not intend to be a political figure. He seemed to largely ignore the Romans, and even saved His criticisms and rebukes not for the political leaders, but for the leaders of His own people; their spiritual leaders. When He taught righteousness it was never backed by force. When He told the rich man to give all he had to the poor the man walked away; Jesus did not force him to obey, but instead let him go. He refused to use earthly law to punish a prostitute by stoning; instead he told her, "Go and sin no more," and left her free to decide. He did not come to spread his Kingdom with the tools of earthly kingdoms – force and coercion. He did not come to offer political freedom. He came to offer freedom from something much deeper.

To conflate the work of Christ with the work of worldly politics is to miss the meaning of His life, death, and resurrection. To claim that a Christian must vote for a specific policy or politician, that Christians must use government to enforce our morals – to prohibit bad behavior or to force good behavior – is to reduce the work of Christ to the work of a politician. He is not too weak or insignificant for political battles; political battles are too weak and insignificant for Him. The kind of freedom and righteousness He offers is far too great, too personal, to be advanced by physical force (which all politics boils down to); politics is beneath the spiritual life, not above it.

Physical freedom is a worthy goal. Defending oneself from violence and oppression is not immoral. But as a Christian, to use government to enforce the morality you believe in through law, backed up by the agents of the state, is to contradict Christ Himself.

It is that desire to look to Christ as a way to accomplish political goals that made Him weep as He entered Jerusalem. They looked for peace through a political savior; He knew the peace He brought was much deeper and could be had regardless of the physical conditions around them. Politics is force. Jesus’ entrance into Jerusalem that day had been prophesied by Zechariah, who described Him as, "Gentle."

Let us emulate Him when we attempt to alter the world around us. Let us never forget that the freedom He brings transcends this world, and His peace cannot be attained or spread by force.

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Read the follow-up to this post, Christianity and Freedom.

Mises Dailies Archive


My articles published at the Mises Institute - http://mises.org/articles.aspx?AuthorId=1109

Why I Don’t Follow the News


I rarely follow the news and almost never get it direct from news sources. What news I'm up on tends to find it's way to me through filters - blogs I read, emails from friends, Facebook posts and hearsay.

This is not because of laziness or a lack of concern with being informed.  Indeed, I love information, trivia, knowledge and truth.  However, I found that keeping up on the news, especially reading papers and watching news shows, significantly diminished my quality of life.  It made me angry and depressed more often than not.

This is not because the cold, hard realities of terrestrial life are simply all bad news.  In fact every day billions of people are voluntarily, peacefully co-operating and being made better off through trade, commerce, community, and friendship.  Millions of things are invented, quality of life improves, the creative destruction of the market (in both goods and ideas) brings about untold beauty and opportunity.  Indeed, with a little bit of reflection it is not hard to see how vast, mysterious and awesome life is, even in the smallest tasks of a typical day.

But, probably for rational reasons, the news chooses to focus on those relatively few happenings between relatively few people that are violent, coercive and troubling.  A disproportionate amount of space is devoted to that tiny sliver of our individual and societal existence, politics, and nearly all the rest to all the other dangers and troubles in the universe.

It's not an accurate picture of the world, nor is it particularly useful.  I think it was for this reason (and perhaps the generally bad quality of the writing) that C.S. Lewis warned against frequent newspaper reading.  Mark Twain (I think) said "Those who don't read the news are uninformed.  Those who do are misinformed".

Does this mean we turn a blind eye to reality so that we can be happy?  Isn't that a form of escapism?  Frankly, I think that's the wrong question.

There is a phenomenal scene in The Silver Chair, part of C.S. Lewis's Chronicles of Narnia series, where a group of children and a kindly swamp creature are trapped in an underground world by an evil queen.  The queen has them under a sort of spell and she is trying to convince them that there is no outside world, but only the cavernous underworld.  When they object and say that the outside world is real she asks them what it is like.  They tell her it has a sun, which is much like the lights in the cave only bigger and brighter; it has lions which are much like the cats of the underworld only grander and more fierce, and so on.

The queen remarks that there is no outside world at all, but that the children have simply taken things from the real world and pretended they were bigger and better.  It was a mere game, and the reality was in the caves all along.

The group is on the verge of being persuaded of this sad state when the humble swamp creature proclaims that even if this were true, what would it say about the real world?  What kind of world would it be if children could easily create a make-believe world that was so much better?  Even if the outside world is make-believe, he declares, it's so much preferable to the "real world" underground that he'd rather go on pretending.  At that the spell was broken, hope restored and the deceptive queen's power rendered inert.

It is more than a mere cliche to say that perception is reality.  Expectation is also reality.  Believing a better world is real and possible makes this world better, if for no other reason than that positive, optimistic people are more pleasant to be around.

The evidence also supports optimism.  Who could ever have predicted the kinds of technologies and opportunities we have available today even just 50 or 100 years ago?  The iPhone alone is jam packed with capabilities that were the stuff of sci-fi even a decade ago.

Why then do we listen to the news when it constantly reports on the fearful side of the present and future?  That is only one view of reality.  It's a tiny slice of all that is, and a very unrepresentative slice at that.  If a human can only take in so much of reality at once, why would I focus on the negative in a sea of positive?

I'd rather create my own reality - a powerful, free, beautiful one - than get angry about the false reality portrayed by the news.  If that's escapism, so be it.  Escaping something bad into something better is nothing to be ashamed of.  It's a choice to perceive and embrace reality in a more useful, constructive manner.

It doesn't mean injustice doesn't exist, or that there are not things I am hoping and fighting to change - not least of which are in myself.  It just means there are better ways of doing it and thinking about it.

Instead of letting it be selected for me, I choose each day what bits of news I take in about the vast and wondrous universe.  It beats the hell out of the paper.

The Pursuit


This was written in response to a challenge issued among myself and some good freinds.  We wanted to see who could write the best short story using only 200 words.  My attempt clocks in at 200 words exactly.

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The crinkling of the paper bag brought hope and tension…thankfully there was life inside.  Shep did not hesitate to pull out the store-bought mini pie, half eaten though it was.   They split it.  Any sustenance the two could get was welcome, especially in weather like this.

Until tonight Tad had enjoyed the thrill of the chase.  An outlaw.  Free, yet a slave to stealth.   Their faces were posted everywhere, they were wanted, and for no small reward.  Many days practicing the art of evasion were catching up to the old friends, and they felt it in their lungs and stomachs.  Both had thoughts of turning themselves in and ending the whole thing…not after coming so far.

Neither spoke; neither rested well, both constantly wondered when the other would suggest they continue on.  Both knew they soon must.  It was difficult to think of trading the shelter of the highway bridge for the cold rain.  A moment of daydreaming was broken…Tad’s muscles tensed as he saw light not fifty yards away…

As they fled their shelter the sound of voices echoed behind them, reminding them how close they were to caught:

“Tad! Tad! Shep!”

“C’mon boys, c’mon…”

“Good hunting dogs indeed!”

A Pure Duality


It has come into my mind that you’ve grown frustrated, or confused as to why I have not been in any real sense present in your life. I will not pretend to have an answer sufficient to settle your uneasiness and feeling of loss, but I can perhaps provide a fuller perspective.

I don’t know exactly where I am, or rather where all of me is. Have you ever been two places at once? I don’t suspect so, as I think it is rare among the healthy on earth. Maybe I should start from the beginning…

Late in the fall some twenty years ago I awoke on a typical morning and left for work. I left a wonderful family and a great house, and headed off to a promising job. I don’t remember giving much thought to my life during that short car ride, but I felt somewhere that I had led a good one.

Something happened…blackness…I don’t remember much for a long period of time-like when you know you’re asleep, but you’re not dreaming or thinking, just blackness. This felt like weeks, or months.

As if my eyes were opened, there I was. I was suddenly in a great green field, surrounded by multitudes of rejoicing people. It was a magnificent celebration, and we seemed to be in some beautiful valley on a beautiful sunny day. It was unlike any landscape I’d seen before, unreal in its beauty, yet more real than any solid object.

A wise old man, who seemed one thousand years of age, yet looked not fifty and healthy, stepped out from the crowd and greeted me warmly.

“Welcome! We have been waiting for you for quite some time!”

Thinking I was dreaming I didn’t respond, but just watched and listened.

“Come, walk with me; you have many choices before you.” He said, “You have come here because you are greatly needed…your gifts make you extremely precious in these times, and those to come no doubt. I can assure you it will all make sense eventually, and your every need will be met, you have only to choose whether you are willing, or not.”

“What are you talking about?” I asked.

“Not many are given this choice you know.” He replied.

“What choice am I given? Am I dreaming? Given the choice to wake or continue dreaming, I would gladly wake, and remain sensible.”

“You are in no way dreaming!” He shouted, not seeming in the least amused, “I took you for smarter than one who thinks this is a dream!”

Not wanting to further offend him, but still unsure of the nature if this experience, I did not attempt to defend my statement.

“Now, your choice?”

“Explain to me what choice you refer to, and I will gladly tell you my thoughts on it.” I replied.

“Your thoughts on it? Your thoughts? This surely will not do! This is not a choice but to muse on, or some hypothetical presented for mental exercise or sport! This is The choice! The choice!”

Still confused I was forced to ask again what now seemed a stupid question.

“What choice?”

“Sit down son.” He said, “I can see that you are still fresh in your logic, and your time in the darkness did not cleanse you from your confidence in what you know and have taught yourself to react to. Impressive mind indeed, very impressive.”

Not knowing what kind of statement this was, but choosing to take it as a compliment, I felt proud of whatever it was that my mind had done to slow this process, and necessitate further explanation.

“Your ignorance, at least, is a result of much discipline and so being is quite consistent, and finely tuned, so I shall paint for you a simpler picture, in your undeveloped language.”

I think he sensed my pride after his previous statement, and simply had to let me know that whatever plane he operated on was one higher than mine. At first I grew resistant, but this lasted only a minute, as my curiosity soon overtook my dual senses of dignity and defensiveness, and I listened to what he had to say.

“Here in this realm, let us call it X, for I can only assume by your look that you are comfortable with mathematical terms, there is a great movement occurring in the great war that is ever raging. Though I cannot explain it without giving you references to what you know as ‘time’, try not to focus on the sequential order of these events. Our enemy has hit us with something so twisted, so divisive and confusing, that we petitioned our superiors for an exception. This exception was sought so that we might bring you here, for we knew that to overthrow this plot of our foe, you were our only choice. An exception was granted. Which is what brought you, after a long time in the darkness for purposes of ‘unlearning’, (though now I see perhaps not long enough) out of what we shall call subordinate X, and into X.”

Though not understanding all of this, I moved on to the original question, and repeated it. “Yes, but you have still not told me what this choice is?”

“As with any exception, it is only granted on the condition that you are given the choice of whether or not to accept. You see, without this choice your presence here would be counterproductive and even fatal. By denying you choice, the enemy would have already won, and our need of you to combat his attack would no longer exist. Thus, I have been given the authority to grant you your choice.”

“Yes, yes but again, what is the choice! I cannot see any choice at all, for I am here listening to you speak whether I want to wake up or not!”

“You are incorrect! Even now you are choosing. You do not have to be here, but your willingness brought you, and now your curiosity keeps you here. Do not so underestimate your will. However, I need not go further into this. You are correct to seek an explanation of the choice. You have been pulled, temporarily, from subordinate X to be presented with the situation we are facing in our war, and our need of your gifts. Your choice is, quite simply, whether you want to help us, or return to your family and all that you previously knew (in the simplest sense of the word ‘know’ that is) in subordinate X. “

It suddenly occurred to me that I had a family. Three young children, a beautiful wife, a life that I loved….it suddenly sank in that I was indeed in another place, away from all of that, and that this wasn’t a dream.

“You mean, I must choose whether to stay here and help you, and never return to my family and my life as it was…or to go back, and leave you without whatever of me you are in need of?”

“Precisely.”

“And what of you, if I choose to go back?”

“I know not. I only know that things were desperate enough for me to be granted an exception. This is evidence enough of the nature of our situation for me to implore you with all my heart, please stay! But in any case, please choose soon, for time, as you know it, though not passing here, is growing short in the place from which you come.”

I felt, for no reason I could identify, an urge more pressing that any I’d felt before to stay with this wise stranger and to fight. I knew almost nothing of what I was needed for, or what would ensue, and yet never has my heart desired anything more than to stay and accomplish it. It was what I was made for! I almost shouted out with all my soul that I’d stay, and fight! But suddenly I saw my family again, my three children, my wife, my friends, all that was depending on me for provision, for love, for support and strength….I could not choose!

“Surely there is another way!”

“There is no other way!”

“But I cannot, and will not, abandon my family and my life for this! Yet I cannot and will not run from this place, where I know deep down I was made to serve and fight! No, there is another way, and I choose it!”

“But I tell you, there is not!”

“You? You who tell me all that is unbelievable, all that is profound, you who tell me that you yourself sought and were granted and ‘exception’, now say that there is no way?!?! I don’t believe it! There is another way, and I choose it!”

Suddenly another voice spoke, and thundered with all the urgency and authority in the universe…

“Granted!”

_________________________________

I have been here in X since that one word was spoken. Yet somehow, in some way I know I am also somewhere else. I am two persons, not just one split in half, but two, somehow the same, but entirely different. Neither complete, both lacking something, but each existing where each is needed. I cannot tell you what this means, yet I know, somehow, that this was the right choice. I am here, fulfilling my destiny…yet I know, somehow I am there.

I am sorry you do not see me nor hear me as I once was. But I implore you, do not give up! I do hear you! I do see you! And what you see of me, whatever may be lacking, is me, and yet, not all of me. I am here….and I am there.

A Cigar


Three cheers a man may give to beer,
Or set his watch by Scotch.
But greatest moments surely are
Those when paired with fine cigar.

Isaac Morehouse


Isaac Morehouse is the CEO of Crash, the career launch platform, and the founder of Praxis, a startup apprenticeship program. Isaac is dedicated to the relentless pursuit of freedom. He’s written some books, done some podcasting, and is always experimenting with self-directed living and learning.

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Intellectual Property and Incentives


The standard theory behind support for creating a legal monopoly for certain ideas, processes, and inventions is that absent such promise of monopoly there would be far less innovation.

It has a surface level logic to it.  People respond to incentives.  Legal monopoly means more money for the one who has it.  People tend to like the money incentive.  Therefore, more people will innovate because they have the incentive to capture greater rewards by securing a monopoly on the production or sale of their invention.

The weird thing is it doesn't play out like this in the real world.  Something is missing.

Inventions typically spring from technicians and masters at a craft.  These are the types who are driven by a passion for what they do.  They want to solve problems, discover things, build things, and create things.  So they do.  If they seek a legal monopoly on their invention this happens after the fact.  It is hard to imagine many innovators saying, "Oh wow!  Think of possibility of solving this chemistry problem and discovering an entirely new way to do X!  Wait...get a lawyer in the lab before I go any further.  I refuse to make any discoveries without proof that I'll be protected from competition once I do."

And innovation doesn't look like that.  You can see this by observing areas without the ability to get legal monopolies on their inventions.  Fashion, food, and football are a few of my favorites.  You can copy, borrow, and imitate fashion designs, recipes, and defensive schemes with abandon.  Many people do.  Yet each of these fields is as dynamic as any industry, constantly evolving and introducing new things.  Apparently the innovative offensive coordinator, cook, and designer don't require the promise of monopoly to entice them to innovate.

People do respond to incentives.  This is a fact of life and one that need not be overturned to overturn the belief that IP laws are required for innovation.  Any good economist will tell you that incentives are many, and value is subjective.  The innovators are certainly responsive to money incentives, but 1) legal monopoly is not the only or best way to earn money for inventions and, 2) money isn't the only incentive driving invention.

As for number one, consider how many people are typically working on a similar innovation simultaneously.  With the current IP regime, only one can get the monopoly.  If we want to take incentives seriously, what kind of incentive does this create for all the others?  Furthermore, the one most likely to get the monopoly is the one with all the lawyers and accountants and resources and willingness to take others to court, not the one with the greatest contribution to the discovery.  This would seem to drive upstart innovators away from the task for fear of being sued by the big guys as much or more than it would drive them to innovate for the possible promise of securing a patent.

As for number two, while the promise of monopoly may be the dominant incentive for lawyers and R&D departments, it's not the dominant incentive for inventors.  They innovate first, driven by a passion for the task, the desire to solve a problem, create their dream, help a colleague, or improve their own daily life with some small innovation.  Yes, they want and seek money for the invention once successful, but the absence of a promise of monopoly does not stop them from creating.

Understanding incentives is crucial to really understanding how the world works and how to change it.  But an elementary look at incentives that examines only dollars and cents and only their intended, not actual, beneficiaries will not get you very far.

For more on the problems with intellectual property laws, check out "Against Intellectual Monopoly".  It's excellent.

A Conversation About Ecuador


I joined the wonderful World Wanderers Podcast (hosted by Amanda Kingsmith and Praxis participant Ryan Ferguson!) to talk about our family trip to Ecuador.

I haven't listened to the episode yet, but we recorded it less than a week after we got back from the trip and I remember wondering if I'd even been able to process the experience enough to talk about it sensibly.  I did talk about it (a lot...I think I probably rambled at length...sorry!) and give a sort of quick take on the good, bad, and ugly and some lessons learned.  Still, I'm sure as time goes on we'll form more ideas about our experience.

It was really awesome and also really hard.  It didn't go to plan, but I wouldn't trade it.  A great adventure I don't think any of us will forget!

Anyway, take a listen to the episode if you're interested in hearing one person's take on international travel with kids.  Oh, and listen to other episodes of WWP.  It's a great show!

Here's the episode.

Public Speaking Workshop is Live


*This workshop is not primarily about tips and techniques (though they are offered).  It's about you giving a speech and getting individualized feedback and ways to improve.

We've been doing a public speaking workshop for Praxis participants for a few years, and now for the first time I'm opening it up to the public.  It's a process I learned from an amazing public speaking coach years ago when I was running a summer fellowship program at IHS.

I'll only be accepting 10 people in this course since it demands individual time and attention for each participant to watch your speeches and provide feedback.

Check out the course here.

The course is $149, as cheap as I could get it considering the time required.

The layout is pretty straightforward.  There are a series of ten short videos with tips and best practices for your preparation, props, eyes, mouth, hands, feet, and a few final odds and ends.

After watching the videos you'll record yourself giving a 3-minute speech in front of at least one other person, submit it between May 1-3, I'll respond with feedback within 24 hours, and you'll do a second take and submit between May 4-6, and again I'll deliver final feedback within 24 hours.

The course videos can be watched anytime, as many times as you like, but submissions will only be taken and feedback provided between May 1-7.

This is a pretty awesome workshop I've been through myself, and I think you'll find it valuable.  This open online version is new, and I'm excited to see how it goes!

You can sign up here.

The Secret Weapon Young People Have on the Job Market…


Nothing better to do.

The only things that matter when it comes to succeeding in the marketplace are:

  1. The ability to create value for others.
  2. The ability to persuade others of your value creation potential.

It's not your school, your grades, your network, your knowledge or anything else you may have been told.  Those things are only useful insofar as they help you do #1 or #2.

This should be an empowering revelation.  Value creation opportunities abound.  Yet it often makes young people feel intimidated.  After years in classrooms acquiring few real-world skills and gaining knowledge that is basically an inferior version of what experts possess, how are they supposed to create value for anyone?

Here's where the secret weapon comes in.

Value creation is not about having an absolute advantage over others at some activity.  It's about having a comparative advantage.  This concept, popularized by David Ricardo a few hundred years ago, is a powerful tool to understand and seize opportunity as a young person.  It reveals the secret weapon called 'nothing better to do.'

To have a comparative advantage at something simply requires that your opportunity cost is lower than others.  What you have to give up to engage in that activity is less valuable than what they have to give up.

Young people with few skills and little experience don't have a lot of high value options for how to use their time, so their opportunity cost tends to be very low.  This makes their value creation potential high.

How does it work?

Imagine a CEO who is incredibly organized, detail-oriented, and something of a wizard at scheduling, logistics, travel planning, and utilizing all the best productivity apps and tools.  She's many times better at this than an aspiring 18-year-old.  Yet for every hour she spends planning her travel and meetings, she gives up the ability to spend that hour selling a new client or planning the marketing expansion.  Those are high-value activities, say with the potential to bring in another $30,000 in revenue.  How much is excellent travel planning worth?  Something, but less than that.  Her opportunity cost is very high.

That 18-year-old, on the other hand, has nothing better to do.  Even if it took him three hours to do the travel planning she could do in one, he would be giving up a lot less.  He could no longer browse Facebook, read a textbook, watch Netflix, or play basketball.  There is nothing bad about those activities, but none of them likely have the potential to create $30,000 worth of value for him.

If our 18-year-old realizes this, he has a powerful weapon.  He can offer to take over scheduling for the CEO and free her up to do more valuable work.  She might be reticent because it's possible that he could actually create more work if he's really bad.  To reduce risk further, he can go all in and offer to do it for free and demonstrate his ability by planning one mock trip to show her.

This requires no special skills, just a touch of creativity, persistence, and Googling.  Yet if he lands the gig, even unpaid, he will be exposed to the world of a CEO and probably learn more in a month than he could in a year sitting in classrooms.  He can observe the company and identify other areas to create value - other areas where his opportunity cost is lower than others - and potentiall parlay this into a really cool role there or at another company.  Maybe he can even learn how to start his own.

So few young people try anything like this.  They're stuck spending endless hours and countless dollars getting a piece of paper that makes them identical to every other young person.  They accumulate debt and expectations that make them feel the need to enter the professional world at a level of pay that, frankly, they can't yet justify with their limited skill and experience.  They feel it would be beneath them, after getting an expensive degree, to work for free or low pay to get a foot in the door.  They are completely nuetralizing their greatest asset, their low opportunity cost.

If you're young and have little in the way of monthly expenses or valuable opportunities in front of you, rejoice.  This means you can explore and test and try a great many things.  Your ability to create value is tremendous if you look for places where others have a high opportunity cost and you do not.

Get off the conveyor belt.  Break the mold.  Go do some cool stuff.

If you want a paid apprenticeship with an amazing entrepreneur + rigorous personal and professional development and coaching, check out discoverpraxis.com.

Isaac Morehouse


Isaac Morehouse is the founder and CEO of Praxis, a startup apprenticeship program making degrees irrelevant for careers. Isaac is dedicated to the relentless pursuit of freedom. He’s written some books, done some podcasting, and is always experimenting with self-directed living and learning.

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