Wednesday, December 31, 2008

Semantic confusion

Occasional Kitchen contributor Martin Kelly is having a bit of a rant about libertarianism over at his own place; it's not entirely unjustified, although I think that he concentrates far too much on the views of Rights Theorists rather than Consequentialist minarchists such as your humble Devil.

However, methinks that he has had a little semantic trouble with this sentence...
If there is no such thing as a free lunch—how can there be such a thing as free trade?

In terms of the "free lunch", Martin links to this definition:
The economic theory, and also the lay opinion, that whatever goods and services are provided, they must be paid for by someone - i.e. you don't get something for nothing.

Now, there are several meanings of the word "free"; in the above quote, "free" is quite obviously being used in the sense of "gratis", "complimentary", "costing nothing".

However, when we talk about "free trade", that is not what is meant at all. It is not about whether the trade costs anything, but whether the participants are free to do it. We are using "free" in the sense of "able to act at will", "not hampered", "not under compulsion or restraint".

There may, of course, be a cost element in debating whether or not free trade is, in fact, "free": trade tariffs or regulations may hamper trade or provide a restraint. But then that is not free trade anymore, is it? And that is rather the point.

Does that answer your question, Martin? Or, since you must be aware of this distinction, were you trying to make another point entirely?

13 comments:

DavidNcl said...

It was me who called him a morally bankrupt parasite (echoing his own description).

I had delete that post which because I though it was true but unkind. I've now reinstated it (as best I could).

On Kelley's latest's rant against freedom and free markets - I can see little to attack in this sort of ranting:

"The year 2008 might just be recorded as the year in which libertarianism, an ideology as doctrinaire as Communism, finally hit the skids, like the light going out of a Terminator's eyes, or HAL being disconnected. Its true-believing cheerleaders (amongst whom I count some with whom I hope to remain on friendly terms), will no doubt continue to sit around singing The Hayek Hallelujah in the same way HAL sang 'Daisy, Daisy, Give Me Your Answer Do', their voices becoming slower and slowweeerrr, until someone turns them off as an act of kindness. When the end comes, one hopes that, for their sake, it is quick.
A philosophy that deserved to be strangled at birth, the intellectual props supporting this vicious, unforgiving cult of the self were finally cut away when Hank Paulson proposed a public sector bailout of the American banking system which could only be described as being fascist in character. The word 'fascist' is often abused by those who seek to discredit their opponents - the one thing upon which even scholars of fascism cannot agree is what fascism actually was. It beggars definition as surely as a flying giraffe. Yet what they can agree upon is that fascist economic policy was once defined by a now long dead Italian, who took a load of abuse from libertarians, as being that profit should be private and personal, loss public and social. That was Paulson's first bailout proposal. That's fascism."


Let just agree that of course it's fascism. But so what? Does this loon think Paulson's a free marketeer or some kind of libertarian? Did I miss the memo from the von Mises Institute on that one?

Or what about:

"If you own a car, you protect it with a deadlock, or one of those things you stick across the steering wheel.
So why shouldn't we protect our economy with a tariff in the same way? What is particularly different about the nature of the economy of which we are all a part that the rules for protecting its security should differ so radically from the simplest domestic precautions"


Not being able to see a difference I what is meant by physically protecting a house, car or some other physical structure and subsidies and taxes in an economy of millions of interacting citizens just because some people call both protection is evidence of a thought disorder not clever argument.

Tom Paine said...

I am sure he meant it as a humorous homage to Lewis Carroll who made essentially the same joke when he wrote that something was "stuck as fast as lightning"

Obnoxio The Clown said...

I think he's been smoking DK's socks.

haddock said...

his website is a good illustration of the problem with words.
the expression for clarity, "to put things in black and white" is no chance thing.
Putting things in white and black doesn't work the same.... in fact it's shite and unreadable to those with little patience.

no longer anonymous said...

"Did I miss the memo from the von Mises Institute on that one?"

Which is the key point here. One could argue that this crisis is an embarrassment to neoliberalism/the Chicago School etc but not to the pure free-market economics of the Austrian School which have yet to be tried. I don't perceive a central institution controlling a country's interest rates and laws making the use of fiat money compulsory to be outcomes of a free market.

Anonymous said...

Kelly's a militant Catholic wank who won't be happy until we're all under the rule of Vatican-approved Franco-style strongmen.

He really has no place in a libertarian environment because his attitude, his mindset and the ethos that he espouses are all so resolutely anti-liberty. He is a totalitarian theocratic blackguard (and blowhard) and hard proof that the libertarian movement must not form alliances with people who do not share our basic beliefs about the value of freedom.

Libertarians can afford to have no Fellow Travellers. When we try, and especially when we try to find common ground with shitbags like Kelly, we simply turn ourselves into Useful Idiots in the hands of totalitarians.

Mark Wadsworth said...

I'd go further and argue that free trade is a good example of a free lunch.

The more people are free to trade, by some sort of miracle, the better off we are, without any gummint intervention or rules or cost to the taxpayer.

ChrisM said...

Bah, I just typed out a comment for his blog, and then found I need a blogger account to do so. As a libertarian, can I take the liberty of posting it here instead.

"1. Where 'spontaneous order' has ever 'broken out' in the absence of government. It has not ever happened, and it never will happen, because all societies are hierarchies of one kind or another and in hierarchies it is incapable of happening. "

Well government sprang from non-government so there's one example for starters. And whilst all governments may be hierachies, not all hierarchies are governments.


"2. Name just one war, just one, that proves Bastiat's maxim that 'if goods don't cross borders, troops will'. Name one. Just one."

Its probably a bit of rhetoric. However I don't think it controversial to say that if goods cross borders, troops are a lot less likely to. This comes from both empirical observation (we don't generally go to war with those we do a lot of trade with), and from simple practical considerations. If we trade with someone, the cost of going going to war with them is a lot greater than if we we don't (all else being equal).

"What really gets to me about free trade is the almost schizophrenic way in which free traders can divorce their personal reality from wider macroeconomic reality. We're all protectionists - if you own a home, you protect it with locks. "

In this case locks are analogous to armed forces, not tariffs!! I may protect my house with locks, but I don't charge visitors to come into my house. I probably would not have many visitors if I did.

"If you own a car, you protect it with a deadlock, or one of those things you stick across the steering wheel.
So why shouldn't we protect our economy with a tariff in the same way? What is particularly different about the nature of the economy of which we are all a part that the rules for protecting its security should differ so radically from the simplest domestic precautions?"


Mainly because tarrifs do not protect an economy, they harm it. There is also the fact that not only is a car (or house) not the same thing is an economy, it is not even analogous to one in any meaningful way. (A car and an ecomnomy are both nouns, but that is about all I can think that they have in common). You may as well ask if an economy is made up of goods and services, why isn't a house made of the same thing (instead of bricks).


"Friedman's Doxology to The Pie in The Sky Fairy that 'there's no such thing as a free lunch' (a phrase he did not coin) breaks down when discussing free trade. It's just like the way that Newtonian physics breaks down at the sub-atomic level - the great principles can only stand a particular level of scrutiny. Look at them under a higher degree of magnification, and the whole bang shoot comes apart. "

If it used to cost me $10 to source a product, and I then find I can get that same product for $5, then I don't know about a free lunch, but I could probably get a free McDonalds value meal. More generally, something can be done more or less efficiently. Doing it more efficiently rather than less efficiently leaves us with a surplus that we would not otherwise have had. This surplus strikes me as being a free lunch.

"If there is no such thing as a free lunch - how can there be such a thing as free trade?"
If a set is a mathematical concept, then how can a badger live in a set? Its because the same word can have many different meanings. (In fact set has more meanings than any other word). Free can mean without contstraints or it can mean with out cost. (It probably has other meanings too). If you rephrase your rhetorical question as "If there is no such thing as a cost free meal, how can you have voluntary trade between parties free of outside interference" I think you can see that one does not preclude the other.

Anyway, Happy New Year to you and all the best for 2009.

James Higham said...

That notwithstanding, have a Happy New year, DK.

Little Black Sambo said...

Pointless to argue with an illiterate.

Anonymous said...

2. Name just one war, just one, that proves Bastiat's maxim that 'if goods don't cross borders, troops will'. Name one. Just one.

- The Opium Wars.

Budgie said...

"If there is no such thing as a free lunch - how can there be such a thing as free trade?"

Are socialists really that thick?

I suppose they must be, because whenever they take over an economy they ruin it.

Socialists are so besotted with micro managing that they cannot understand how humans have been trading with each other, without direct government control, for millenia.

Dr Cromarty said...

Kelly's a militant Catholic wank who won't be happy until we're all under the rule of Vatican-approved Franco-style strongmen.

You spastic. Have you read the political outpourings of any churchman, Catholic or otherwise in the last 50 years? The Lim Dems are about as Franco-style as the Vatican would approve of.

Idiot.