Juan Fernando Carpio – The Libertarian Standard http://libertarianstandard.com Property - Prosperity - Peace Wed, 27 Apr 2016 06:16:21 +0000 en-US hourly 1 https://wordpress.org/?v=4.5.3 A new website and group blog of radical Austro-libertarians, shining the light of reason on truth and justice. Juan Fernando Carpio – The Libertarian Standard clean Juan Fernando Carpio – The Libertarian Standard thelibertarianstandard@gmail.com thelibertarianstandard@gmail.com (Juan Fernando Carpio – The Libertarian Standard) CC-BY Property - Prosperity - Peace Juan Fernando Carpio – The Libertarian Standard http://libertarianstandard.com/wp-content/plugins/powerpress/rss_default.jpg http://libertarianstandard.com TV-G 10 economic lessons (that governments would like to hide from you) http://libertarianstandard.com/2015/01/16/10-economic-lessons-that-governments-would-like-to-hide-from-you/ Fri, 16 Jan 2015 07:29:22 +0000 http://libertarianstandard.com/?p=13619 Subtle, JuanFer. Real subtle. :-P10 Lecciones de Economía (que los gobiernos quisieran ocultarle) is the name of my first book (Spanish), available at http://bit.ly/10LeccionesEcon.



Activism for the long run, literally http://libertarianstandard.com/2010/11/23/activism-for-the-long-run-literally/ Wed, 24 Nov 2010 03:16:30 +0000 http://libertarianstandard.com/?p=7214 Our fellow blogger and friend Vijay Boyapati is running 26 miles for the cause of Austrian Economics and Libertarianism. He will match up to $13,000 from the donors (you can donate 5, 10 or 15 dollars an up and he will match your donation) for a total of $26,000 to be donated to the Ludwig von Mises Institute. That is $1000 per mile. The Ludwig von Mises Institute was surprised by Vijay’s spontaneous initiative and so are the rest of us. The donations amount to $7,500 at this time, so to our readers I say “join the campaign!”

Run Vijay, run!

The Instituto Ludwig von Mises Ecuador is born http://libertarianstandard.com/2010/10/18/the-instituto-ludwig-von-mises-ecuador-is-born/ Mon, 18 Oct 2010 16:01:13 +0000 http://libertarianstandard.com/?p=6656 When I embarked upon the task of teaching Austrian Economics at USFQ (as ECN101 and with some concessions to the mainstream such  as teaching their flawed theories before attacking them) I couldn’t predict beforehand if I was going to find either resistance or support from my students and colleagues. I promise to tell TLS readers about the latter in another occasion. Of every class of 30-33 students for ECN101 I end up focusing on the 5-10 that are really into the material. We read a lot of Hoppe, Rothbard, Reisman, Dilorenzo, Kinsella and Block. Of course I tell my students that my class’ purpose is to show them a different point of view, since the “official” one can be found on the MSM of Ecuador and the U.S. and other classes even at USFQ (most PhD professors being either natural science types or liberal arts former hippies that support any soft form of socialism you can imagine there is.)

Of course of this 5-10 (per class, and I teach 3 classes per semester) maybe 2 or 3 become ardent libertarians and are encouraged to attend Mises University and FEE Seminars during the following summer. Last semester, I taught an “Advanced Libertarianism” seminar for the 12 best students from the past two years. Their enthusiasm being at a peak, they decided to do as Helio Beltrao and his libertarian cadre did in Brazil and create a LVMI-Ecuador think tank. My students Esteban Perez, Cindy Aguiar, Esteban Torres, Lizeth Torres, Alejandro Veintimilla, Pablo Mateus, Paul Riera and Lizeth Vasconez are the culprits: they are they driving force for LVMI-Ecuador. I’ll just say you better remember their names, they are very young but I bet they will make the headlines of libertarian and MSM publications later on.

The most exciting thing is that thanks to web 2.0 we can hold board meetings via Skype, promote our articles (60% of mises.ec being the translated Mises Daily articles) and events (this Wednesday we begin with “Cuba and the elephants” a thought-provoking documentary) via Facebook and keep our fixed costs to $40usd a year (for the .ec domain.)

In sum, today I want to share with you the official launch of www.mises.ec as the core service the Instituto Ludwig von Mises Ecuador has to offer the region and country in which it operates.

TLS Q&A: What is Austrian Economics? http://libertarianstandard.com/2010/08/15/tls-qa-what-is-austrian-economics/ Mon, 16 Aug 2010 04:50:54 +0000 http://libertarianstandard.com/?p=4572

Reader Ryan reminded us that not everyone who happens upon The Libertarian Standard will know what Austrian Economics is. Since an understanding of sound economics is so important to understanding the case for liberty, and Austrian Economics just is sound economics, we decided to make this the first question-and-answer for our Q&A series and the first addition to our Libertarian FAQ. Remember, you too can submit questions to us that you would like us to answer, if not for yourself then for the benefit of others. Inspire us!

What is Austrian Economics?

Austrian Economics is paradigm, a way of analyzing economic and social phenomena that is sometimes completely at odds with the “mainstream” of Economics both in academe and among the ruling elites. AE is centered in the acting human being and thus follows a strict causal-realist that -claim its enthusiasts- render a far deeper and truer comprehension of what goes on in human societies.

This tradition or school of thought is the culmination of centuries and perhaps even millenia of (European) continental subjectivist notions that can be traced back to the ancient Greeks and all the way through Roman thinkers, Medievalists, Renaissance and finally modern authors. What makes it distinctive is the focus on human action rather than in objective (materialistic), aggregated additions and substractions of actors and goods (viewing the forest but losing sight of the trees or ignoring them altogether) as well as idealized mathematical and geometrical models (in a supposed desired to seem “more scientific” that otherwise).

The Austrian School’s founder, Carl Menger, wrote his “Principles of Political Economy” as a structured marginalist1 answer to the Methodenstreit (a debate on method) that he was having with the German historicists, who claimed that there are no economic (reality) laws but rather recipes that may or not work depending of time and place. His successor, Eugen von Böhm-Bawerk, used the same marginalist approach to explain capital, savings, investment, interest and time preference. His contenders of the time were the Marxists but also the clearly stuck “Classical” economists of the British islands who were making mistakes as grave as to have engendered -at least partially- the bases for Marxism and Keynesianism. Böhm-Bawerk’s most brilliant student was Ludwig von Mises, considered by many as the best economist ever. Mises predicted as early as in 1921 that socialism was an untenable ideas because it kills the possibility of economic calculation (the final products being more than the intermediate goods and other things spent used to make them) and thus renders the whole of society (qua division of labor) a chaotic and inharmonious cluster of errors.

Mises also demonstrated that economic booms and busts are caused by an easy credit (no previous savings backing it up) policy mainly coming from States. Finally Mises demonstrated the universal character of economic laws as features of human action thus recouperating Economics from the relativistic pitfalls of empirism and historicism once again popular in his time. Mises’ most famous student, Friedrich A. von Hayek was awarded a Nobel Prize in Economics in 1974 in big part due to this work with Mises on the direct threat that Intervencionism and Inflationism pose for free societies. The Austrian School found a Misesian revival after Hayek abandoned Economics to pursue other intellectual interests under the influence of Karl Popper and others, when Murray N. Rothbard wrote his treatise “Man, Economy and State”. Rothbard went beyond his teacher not only on strict Economics matters such as monopoly or Interventionism but mainly he set a foundation of Ethics that would resist any utilitarian attempt to seek anything but freedom because of special considerations of any kind. Other students of Mises that need mention are Hans Sennholz, a prolific writer on the subjects of money and inflation; Henry Hazlitt -the NYTimes Economics editor- who although wasn’t a student of Mises personally, was tremendously influenced by him; Israel Kirzner from NYU, with a clear Hayekian strand of analysis of entrepreneurship and coordination, Ralph Raico a revisionist historian of prime qualities and George Reisman, whose attempts at an Austrian + Classical synthesis are controversial but very interesting nonetheless.

Currently the hotbead of Austrian Economics is Auburn, Alabama where Llewellyn Rockwell Jr. setup the “Ludwig von Mises” Institute to help spread the Misesian-Rothbardian strand of AE. Scholars close to or directly working with the LVMI are prof. Hans-Hermann Hoppe, a radical and pathbreaking thinker, prof. Jörg Guido-Hülsmann who has made original contributions to several subjects including the Ethics of money production, profs. Joseph Salerno, Peter Klein, Walter Block and Thomas Dilorenzo. Today www.mises.org is a world famous source of economic education in the causal-realist paradigm and is in no small part responsible for the revival of AE and its arrival to countries such as Ecuador, Brazil, Spain, Sweden and Chzech Republic among dozens others that are seeing the formation of Misesian centers for thought and education in the tradition of the Austrian School.

  1. Analyzing the whole from the relevant unit added to it instead of analyzing wholes/aggregates 

Manuel F. Ayau (1925-2010), R.I.P. http://libertarianstandard.com/2010/08/04/manuel-f-ayau-1925-2010-r-i-p/ http://libertarianstandard.com/2010/08/04/manuel-f-ayau-1925-2010-r-i-p/#comments Wed, 04 Aug 2010 17:53:15 +0000 http://libertarianstandard.com/?p=3802 Manuel F. Ayau

Manuel F. Ayau (1925-2010)

Today we mourn the passing away of Latin America’s titan of liberty, Manuel “El Muso” Ayau. His life was truly inspiring from being entrepreneurially successful, to having two doctoral degrees (Literature and Law) to founding a school (Universidad Francisco Marroquín in Guatemala City) based on the idea of taking the world back for classic liberal ideas in a continent ridden with defeatist, authoritarian socialist ideas.

To those of us lucky enough to meet him, it was surprising how warm and elegant he always was in any conversation, specially in heated debates. This he probably took from his beloved F.A. Hayek. But he was also frontal, direct and precise in logic. This, in contrast, I guess comes from his deep admiration for Ludwig von Mises.

Alas, it were Mises and Hayek the two thinkers that he wanted his young students at UFM to know about. At this truly unique university, students had to get themselves acquainted with Misesian Economics (i.e. sound, coherent economic theory and history) and Hayekian Social Thought (i.e. spontaneous and evolving social orders that escaped any pretense of social planning). I myself studied my master’s program at Muso’s UFM thanks not only to UFM existing in the first place and being considered a Mecca for Austrian Economics in our region, but also thanks to his direct support and endorsement. He was always able to gather the best Austrian minds in the region (at some point this was undoutedly the Argentinian profesors) and some of us have been granted the resulting opportunities still unmatched in several other regions of the world.

Photocopy we shared of the book the autographed for us

Muso was kind enough to send a video message for the members to the Movimiento Libertario in Ecuador andcopies of his books (brilliant, easy to understand books I have to say) whenever one of us was invited to the Austrian Mecca for a Liberty Fund event hosted by UFM.

This is a very sad day in which Latin American libertarians ought to make pause and reflect upon this great man’s legacy of courage, vision and clarity. It is now our task to multiply his deeds to a point that would make him eternally joyful wherever he now is.

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“I think, therefore I own” – Objectivists as NeoMarxists of sorts http://libertarianstandard.com/2010/08/02/i-think-therefore-i-own-objectivists-as-neomarxists-of-sorts/ http://libertarianstandard.com/2010/08/02/i-think-therefore-i-own-objectivists-as-neomarxists-of-sorts/#comments Mon, 02 Aug 2010 07:37:16 +0000 http://libertarianstandard.com/?p=3690 The usual apology for IP (“intellectual property”) privilege is that effort has to be rewarded in an advanced society if justice is to be made to creators and producers.

Interesting: Marxists say the very same thing. They claim that previous effort (“frozen labor”) is that which gives value to economic goods. Well, Objectivists are doing the same in a more fashionable — yet equally flawed — way. They claim economic value is derived from frozen…thoughts. Yes, frozen thoughts. See, Objectivists consider labor performed inside our heads1 the source of economic value, and thus being the very core of value creation it has to be rightfully protected at all costs, right?

Wrong. The source of value is the customer’s valuation of said good during the time of sale.

Yes, ladies and gentlement, it is sales (that mundane and sordid act) that which generates an income in a free society (i.e. the division of labor). Sales are the only way in which demonstrated preference tells us that which is valuable to others. And if it is, they surrender certain amount of another good by giving it to us in exchange for what they need and want. That good is generally one of general acceptance (the most marketeable one), in other words, money. So in order to make money one has to sell. It does not suffice to sit, philosopher style (see pic), and wait for money to come to oneself. One has to know how to turn the idea into an attractive and/or useful product, which requires a whole different set of skills. Or find able partners for the risk-taking endeavor. Even choosing an adequate partner/team for production, distribution, and sales require entrepreneurial skills far beyond the usual thinker’s.

But in any case, it is not “who thought of this first?” that makes people buy more of brand X. The customer couldn’t care less either way. It is the positioning of brand X in the customer’s mind that creates what we call a true market niche for a product. Thus, it follows that it is opportunity, quality and ultimately demonstrated preference (sales) that determines commercial success. Alas, Capitalism is not the social system of thinkers (nor was Socialism, as it was predictably taken over by power-mongers): it is the social system of merchants. Yes, lowly, mundane, and anti-intellectual merchants.

This, to the despair of (Objectivist) NeoMarxism and Marxism, two philosophies founded  by intellectuals who wanted to highlight the role of people like themselves.

  1. A substantially less sweaty form of labor, of course 

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How one should *not* write a FAQ (Capitalism.org) http://libertarianstandard.com/2010/08/01/how-one-should-not-write-a-faq-capitalism-org/ Mon, 02 Aug 2010 01:37:29 +0000 http://libertarianstandard.com/?p=3677 On the Capitalism.org FAQ we find this jewel of an answer:

Why is “anarcho-capitalism” a contradiction in terms?

Those who attempt to combine anarchism with capitalism, make the error of confusing the peaceful form of competition of capitalism — trade, ideas, and dollars — with the brutal “jungle” form of competition of anarchism — brutality, whims, and bombs.

Have you ever thought what happens when one ‘corporate protection agency’ disagrees with another? By what method do they solve their dispute? They do it by competition not with dollars, but with guns. They seek to solve their dispute by resorting to force against each other, i.e., a perpetual state of civil war. Under such a system, which gang wins? The one that is the most brutal.

Ok let us add the precision it lacks to this sloppy argument.

1) Why or how is it than ancaps (short for anarcho-capitalists) make the mistake of confusing those two scenarios? Are they dumb and they can’t tell one from the other? Are they evil and they want to profit from a deliberate confusion? The FAQ author won’t tell us. Which is quite telling.

2) For an answer a question is foisted upon us: “Have you ever thought…?” but then we learn soon enough the question is merely rethorical for the author has the answer! “They seek to…by resolving to force.” Interesting. He’s omniscient and he knows what they seek. No theoretical or historical means for knowing this are made transparent to the reader. He just tells us “they seek to!” And of course civil war would be perpetual. Because of course physical violence is never tiring, expensive and painful in every possible sense, so it would be “perpetual.” But of course the very idea of a war is one that the author assumes with no previous explanation.

Well, let me ask a question to answer the rethorical question as if it was earnestly asked:1

Have you ever thought what happens when one Chamber of Commerce disagrees with another (please think of each one representing someone from either different regions or just both cohabiting in the same city)? They seek to solve their dispute by resorting to the least costly and prolonged method. That is, a third party which is not involved itself in the dispute and that has enough authority (expert power, the current jargon would say) as to produce a solution that both parties will abide by voluntarily. Under such a system, which Chamber of Commerce wins? The one that serves its client better and allows him to be considered a lawful member of society, worthy of long-term business relationships devoid of legal trickery. By “winning,” I mean, of course, both, insofar as they want to stay in the dispute resolution business.

  1. Objectivists being a NeoMarxist breed never thus ask questions seeking to learn. Why would they, they have the Rand gospels to enlighten them, and any criticism is a just roadblock to Galt’s Gulch at best. 

Purchasing power gains or losses respective to the U.S. of several countries http://libertarianstandard.com/2010/07/09/purchasing-power-gains-or-losses-respective-to-the-u-s-of-several-countries/ Fri, 09 Jul 2010 22:24:44 +0000 http://libertarianstandard.com/2010/07/09/purchasing-power-gains-or-losses-respective-to-the-u-s-of-several-countries/ Market-oriented reforms such as privatization, deregulation and tariff decreases being the clear and unequivocal factors.

In PPP terms, asigning a quotient of 1 to the U.S.

Country         1980     1994     2008

United States      1.000       1.000       1.000
Australia                 .841           .770          .837
Canada                     .905          .818           .843
Britain                      .688          .705           .765
France                      .780          .730           .713
Germany                 .803          .812           .763
Italy                          .756          .754           .675
Sweden                    .868          .777           .794
Switzerland          1.146          .987           .915


Hong Kong            .547          .845           .948
Japan                       .732           .815           .736
Singapore              .577           .899         1.064

Latin America

Argentina              .395           .300          .309
Chile                        .210            .251           .311

Source: World Bank.

Two questions on anti-IP http://libertarianstandard.com/2010/07/08/two-questions-on-anti-ip/ http://libertarianstandard.com/2010/07/08/two-questions-on-anti-ip/#comments Thu, 08 Jul 2010 19:05:28 +0000 http://libertarianstandard.com/2010/07/08/two-questions-on-anti-ip/ As a lecturer of ECN101 at USFQ, Ecuador, I regularly take my students through all the basic tenets of Economic Science. Of course, I have a primordially Austrian approach, but I make sure to give them an overview of the current debates among schools of thought and even within them (did someone say Bizantine arguments ad infinitum?)

Using Googlegroups, I use the email list format to discuss any and all subjects, and last night it was IP’s turn (i.e. so-called “intellectual property”).

After watching this one minute video, the immediate reaction was rejection, followed by two questions I find of interest to TLS readers.

1.- Does copying mean I can plagiarize or make fakes of arts and crafts?

2.- How about the effort the creator puts into his/her work? Doesn’t a copy make the original loose value?

To which I answer through some thoughts on IP in an attempt to answer both questions and discuss some additional angles of the “IP problem”.


The commonly used example of “wrong” copying is movies. But the very same person will have replicas of Rembrandt at home without even noticing the irony of the situation. As a matter of fact people can clearly distinguish between original/legit watches and fakes, and the same goes for anything else. The reason we prefer originals brands is because it ensures quality meaning a sense of authenticity and/or flawlessness that comes from a direct relationship to the brand. And we all know how to buy originals: find a vendor you trust. Preferably, one authorized (perhaps exclusively for a geographical zone) by the producer itself.

When we imitate other people’s behavior (what pyschologists call “modelling”) we know it’s not real (from within) yet it may be a necessary step in personal growth. We grow up imitating. Then, we can modify and create.

So to begin with, we’re all cultural imitators. The amount of work that goes into creating a dance step, recipe or social rite has never in the past precluded people from imitating it faster. Learning implies by necessity a time-saving process where the student uses less time and trial&error (what we call the “learning curve”) to achieve the same. But the teacher does not charge for the content. He charges for his performance. The libraries have always been there for centuries gathering dust, yet we prefer to learn from someone in a structured, stimulating way.

So, to set an arbitrary line and say “now” or “from this point on” what are cultural patterns (copyright over dance steps), painting techniques or styles (aprentices of Manet or Kingman were paid to copy the style to perfection so he sold them under his name), writing styles (ghost writers, fan fiction, fan movies) is a further step down the path of foolishness.

But ok, what about commercial products. They are produced, after all, with the intention of profiting from their sale. But see, we have three components here: production, intention and sales. Some ideas never go into production or are underproduced to benefit producers with high(er) prices at the “expense” of consumers. Some goods are produced without an intention to sell them or with characteristics that render them commercially worthless. And finally, sales are not a certain result of attempts to sell. But in the market as much as in sports, it is neither conception, intention or trying that which wins over the public and serves it better. A long run of score-less matches will scare away most sports fans, in the same way that attempts to sell us things waste our time and patience if they don’t turn into real sales.

So, as we see, it’s not effort but results that which counts in generating welfare for our chosen public. In other words, it’s not effort but sales that which generates income in the division-of-labor. Sales. So it’s quite evident to me that if an inventor doesn’t find a way to hit the market first (remember, the market is a metaphor incarnated in a network of property title exchanges) it’s not only fair but good for mankind that others do serve the public with attractive products derived from his invention, design or recipe.

This of course has nothing to do with fraud and plagiarism. Claiming a Picasso is original when it isn’t or claiming you wrote “A Hundred Years of Solitude” is clearly deceiving. It has to be punished by the legal system but even if it isn’t, the market itself has exclusion, bad reputation and boycott mechanisms used all the time. And they would be even more intensively used if the State didn’t provide us with a fake sensation of security in that (and dozens of others) field. But a replica, a cd copy, an mp3 handed over to you is a very different thing. It takes nothing from the producer, and the only one who gets less value (if that is the case at all) than when buying original is yourself.

Last but not least: the fakes do not decrease the sales of the original good. They don’t in the absolute sense whenever both were available to be chosen instead of the other, but they don’t in the relative sense either: a bad pricing policy for lower income segments or regions of the world should always be blamed on the seller, not the unwilling customer. If Microsoft sold Windows 7 in low monthly installments in Latin America, the trend would start to change towards having the company’s support and other original product advantages. The same goes for $18 usd music albums from Virgin when besides a pretty box, there’s no profit (like memorabilia or a poster or anything of the sort) in not having just the mp3 version.

To those companies I say: Give us enough value for the price you ask, and we will prefer you over pirates. Meanwhile, piracy is your best ally or you would never know how badly you’re handling it all.

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The graphic display of U.S. financial health http://libertarianstandard.com/2010/05/14/the-graphic-display-of-u-s-financial-health/ Fri, 14 May 2010 20:54:33 +0000 http://libertarianstandard.com/?p=1716 With the U.S. displaying characteristically Third World national stats, and average households deep in financial trouble (see below),

(Click to enlarge.)

…one truly wonders if the Obama administration has any sense of proportion at all when proposing a ridiculous 100mm dollar budget cut.  Consider that more than a quarter of the total budget is financed by growing debt (people’s savings, and, by people, I mean Chinese people and other net savings countries like Chile and El Salvador that have been long buying U.S. Treasury bonds and transfering their savings). Click here to see what those 100mm represent with respect to the total budget.