Kant on autarky

Leafing idly through Russell’s History of Western Philosophy, I came across this interesting quote (p 683 in the Unwin paperback edition)

Kant gives as an illustration of the categorical imperative that it is wrong to borrow money, because if we all try to do so there would be no money left to borrow

Russell seems to see nothing wrong with this, but it is obvious that the same argument applies to trade of any kind. If I engage in trade, I must be a net buyer of something, say bread. But if everyone tried to be a net buyer of bread, there would be none left. Hence the categorical imperative requires everyone to be self-sufficient.

I assume this constitutes a reductio ad absurdam for Kant’s argument against borrowing. But is it possible to reject the argument against borrowing while accepting the categorical imperative from which it is derived? Any Kantians among the readers of this blog are invited to set me straight on this point.

Update In the comments thread, James Farrell points out that, contrary to the quote from Russell, Kant was talking about borrowing money without the intention of repaying it.

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This piece in the NYT reports that Warren Buffett is making a countercyclical move into manufactured housing. Until recently, at least, this form of housing (pejoratively referred to as ‘trailers’) has been very significant in the US – around 20 per cent of all new houses, and up to 50 per cent in rural areas.

This raises a number of questions. First, why there is no comparable development in Australia, where manufactured units are typically used only as holiday accommodation? Is it a matter of building regulations, and if so should we be changing these regulations to bring down housing costs? Or, as the NYT story implies, does this kind of housing degenerate rapidly towards slum status. The rapid decline in the manufactured housing market during the boom of the late 90s seems to support the view that this is a last-resort option.

There’s also a bigger question which I’ve been puzzling over for some time. Real incomes for the bottom 40 per cent or so of US households haven’t risen since the 1970s. At the same time, ownership of items like TVs and washing machines has expanded significantly. That’s not surprising, since the relative price of these items has dropped. But that implies that other relative prices have risen, and housing is an obvious candidate. Has housing quality declined for low-income Americans? If consumption of all items has increased, while income has been constant, the implication is obviously that savings have declined, presumably because of the availability of new forms of credit, and the story also hints at this.

I’d be very interested in any comments and grateful if anyone has useful references on the points I’ve raised.

Monday Message Board

I’m on the road for a couple of weeks, first on a short visit to the Snowy Mountains, and then going to the Economists’ conference in Canberra. So postings may be infrequent and erratic (that is, more erratic than usual). I hope readers will fill the gap with their views on any topic (as always, civilised discussion and no coarse language please).

Honest, or effective?

In the comments thread for my post on Lomborg, I’ve been presented yet again with the widely-reproduced quotation in which Stephen Schneider is supposed to have advocated scientific dishonesty in the interests of environmentalism. In fact, the history of this quote proves exactly the opposite of the point intended by those who use it.

The original quote, was in an interview by Discover Magazine in 1989, where Schneider discussed the problems of dealing with the media. (I’ve looked in vain for the full interview, so I’ll make my usual appeal for help on this).
The relevant paragraph is

On the one hand, as scientists we are ethically bound to the scientific method, in effect promising to tell the truth, the whole truth, and nothing but – which means that we must include all the doubts, the caveats, the ifs, ands, and buts. On the other hand, we are not just scientists but human beings as well. And like most people we’d like to see the world a better place, which in this context translates into our working to reduce the risk of potentially disastrous climatic change. To do that we need to get some broadbased support, to capture the public’s imagination. That, of course, entails getting loads of media coverage. So we have to offer up scary scenarios, make simplified, dramatic statements, and make little mention of any doubts we might have. This ‘double ethical bind’ we frequently find ourselves in cannot be solved by any formula. Each of us has to decide what the right balance is between being effective and being honest. I hope that means being both.

The first public use of this quote against Simon was by the late Julian Simon (of whom Lomborg is a big fan). Here’s the version he printed, in the APS News, March 1996

Scientist should consider stretching the truth to get some broad base support, to capture the public’s imagination. That, of course, entails getting loads of media coverage. So we have to offer up scary scenarios, make simplified, dramatic statements, and make little mention about any doubts we might have… Each of us has to decide what the right balance is between being effective and being honest. (emphasis added)

The section in bold is a complete fabrication and the remainder of the quote has been distorted by omission of key sentences, notably the final one. Schneider demanded and received the right to print a correction.

One might think that having been caught out in this fashion, Simon and his friends would either avoid using this quote or be careful to get it right. Not a bit of it. Both Simon and his numerous followers have continued to use distorted versions of this quote. (I should note that Lomborg used a short version but was careful enough to give the full quote in a footnote). Here for example is John Daly

To capture the public imagination, we have to offer up some scary scenarios, make simplified dramatic statements and little mention of any doubts one might have. Each of us has to decide the right balance between being effective, and being honest.

Note that critical sentences have been omitted or run together with no indication of what has been done.

What’s really interesting about this episode is that Schneider’s opponents are committing exactly the offence of which they accuse him. They are convinced he is a dangerous scaremonger who needs to be exposed in the interest of “making the world a better place”. Unfortunately, their best piece of evidence has a lot of “ifs, ands and buts”. So rather than “tell the truth, the whole truth and nothing but”, they extract the “simplified dramatic statements” and serve them up to “capture the public imagination”. Indeed, “each of us has to decide what the right balance is between being effective and being honest”, and for not of all us does it mean being both.

UpdateAs regards my own reaction to Schneider’s views, I’ll restate what I said the first time I discussed this. “Iâm not a huge fan of Schneider – I find him overly prone to alarmism, and even in the corrected version I think this comes through. But that doesnât justify reproducing quotations from obviously hostile sources without the simple precaution of a Google check.”

War is bad for health

Not long after the fall of Baghdad, I wrote a piece for the Fin pointing out that the

The total budget of the USAID, the main US agency for development and humanitarian assistance is $8.7 billion for the coming year. That is, the money already spent on the Iraq war could have doubled USAID’s budget for the next five years.

It seems certain, however, that the war will herald a sustained increase in military expenditure of at least $US100 billion per year. A more reasonable comparison, therefore, is the ambitious proposal of the Commission on Macroeconomics and Health, led by Harvard Economist Jeffrey Sachs. The Commission aimed to achieve, for all a poor countries, a two-thirds reduction of 1990 child mortality levels, a three-fourths reduction of 1990 maternal mortality ratios and an end to the rising prevalence of major diseases, especially HIV/AIDS.

As the Commission pointed out, in addition to the humanitarian benefits of saving as many as 8 million lives per year, reductions in mortality are directly correlated with a reduced frequency of military coups and state collapse. These provide the breeding ground for terrorism and dictatorship and ultimately lead, in many cases, lead to US military intervention. The estimated cost for the Commission’s seemingly-utopian program over the next decade is estimated at between $US 50 billion and $US 100 billion per year.

Now, via Tim Dunlop, there’s a piece fromÊSachs himself saying

The cruelest twist, though, is that the all of the talk about US and UK compassion is accompanied by indifference where compassion is truly needed. Nine months ago, Bush spoke movingly about the tragedy of millions of people with AIDS turned away from African hospitals, because they were too poor to afford the drugs. During those nine months another two million or so Africans died, and the United States accomplished absolutely nothing to change the situation. The president’s much vaunted $15 billion five-year program for AIDS is on paper only.

This year Bush asked for only $200 million for the Global Fund to Fight AIDS, TB, and Malaria, a sum equal to 1.5 days of spending on the US occupying forces in Iraq. The US annual contributions to fight malaria are less than the costs of one day’s occupation, and as a result, 3 million Africans will die needlessly from that preventable and treatable disease.

But who is talking about $87 billion for the 30 million Africans dying from the effects of HIV/AIDS, or the children dying of malaria, or the 15 million AIDS orphans, or the dispossessed of Liberia and Sierra Leone, or the impoverished children of America without medical insurance?

As Atrios notes in the comments thread, Sachs has certainly shown a side of his character no one would have suspected when he was prescribing shock therapy for Russia.

Lomborg, yet again

As I won’t be able to make Lomborg’s IPA address, I’ll repost, with marginal changes, an earlier piece setting out my views on him.The only thing that’s changed in the interim is that Lomborg has dropped his earlier pretence of being a leftwinger and repentant greenie, which was, as it were, his unique selling point (thanks to Dave Ricardo for this neat way of putting it). Anyway, here’s my piece.

This will, I promise, be the last thing I post in relation to Lomborg and Kyoto for some time. I want to explain a bit about the development of my ideas and why I’m so strongly pro-Kyoto and anti-Lomborg. I didn’t as ‘Robert Musil’ suggests, reach this position in some kind of green-liberal cocoon. Anyone who knows the ANU economics department, the Australian Bureau of Agricultural and Resource Economics (ABARE) or Townsville, to name a few of my influences, will find this idea laughable.

Rather, I am an environmentalist for the boringly straightforward reason that I love natural environments and want to see them preserved. My favorite environments, reflecting the places I’ve lived most, are the Australian Alps and the Great Barrier Reef. If we get the kind of global warming that seems likely under ‘business as usual’, both will be destroyed or at least radically transformed.

In this context, I think it’s important to take some modest actions now so as to prepare for the need for more substantial reductions in CO2 emissions once the scientific doubts are resolved. If, as is possible but in my view unlikely, it turns out that the problem has been greatly over-estimated, and we have incurred some small economic losses (less than 3 months economic growth) needlessly, it will in my view have been a worthwhile insurance premium. In this context, Kyoto is far from ideal, but it’s the only game in town. The US Administration has given up pretending it has an alternative – it’s talking about adapting to climate change. This is fine for agriculture in the developed world and maybe even in the developing world, but it’s not an option for the Alps or the Reef. So, I’m 100 per cent for Kyoto.

On most other issues, I am, to coin a phrase, a ‘sceptical environmentalist’. That is, I accept the need to take substantial action to control pollution, make agriculture sustainable and so on. But I’ve never believed in the kind of doomsday scenarios postulated in the 1970s by the Club of Rome.

I’m also sceptical in the sense that I try to evaluate each issue on its merits, and to reach my own conclusions, rather than accepting or rejecting environmentalist claims holus-bolus. For example, I’m happy to eat GM food, provided it is properly labelled so I can make my own choices. Similarly, while I doubt that nuclear power is ever going to prove an economically viable energy source, even in the presence of high carbon taxes, I have no problem with mining and exporting uranium, subject to the usual environmental safeguards needed for mining operations in general.

With this background, I began with a very positive attitude towards Lomborg. He seemed to be taking a sensibly optimistic attitude towards environmental problems, pointing to our successes in fixing up pollution problems, the ozone layer and so on, rather than focusing on doomsday scenarios. Then I gradually realised that Lomborg only endorsed past actions to address environmental problems – whenever any issue came up that might involve doing something now, Lomborg always had a reason why we should do nothing. In particular,he came up with an obviously self-contradictory case for doing nothing about global warming, and gave a clearly biased summary of the economic literature on this topic, which I know very well.

After that, I looked at his story about being an environmentalist reluctantly convinced of the truth according to Julian Simon. As I observed a while ago, I first heard this kind of story in Sunday School, and I’ve heard it many times since. It’s almost invariably bogus, and Lomborg is no exception. You don’t need to look far to find errors in Simon’s work as bad as any of those of the Club of Rome, but Lomborg apparently missed them. Going on, I realised that Lomborg’s professed concern for the third world was nothing more than a debating trick – otherwise he wouldn’t have been so quick to dismiss emissions trading with poor countries as politically infeasible.

There’s nothing I hate more than being conned. Lomborg tried to con me, and, for a while, he succeeded. That’s why I’m far more hostile to him than to a forthright opponent of environmentalism like Simon.


Poor old Paddy McGuinness, still living somewhere in the twilight years of the Syndey Push, can’t seem to shake the addiction to the politics of victimhood that characterises so much of the Australian (and even more the American) right. In his recent column in praise of Keith Windschuttle and Bjorn Lomborg, he asserted “

Lomborg will not be speaking at any university campus, since these have become hotbeds of political intolerance where unpopular views are shouted down and the speakers often physically attacked

He doesn’t seem to have noticed that Windschuttle (whose quasi-racist views that the Tasmanian Aborigines were responsible for their own extinction by virtue of their degraded morals are far more offensive than anything Lomborg has to say) has repeatedly appeared on University campuses in debates that have been extensively reported in the blogosphere.

More directly to the point, his claim that Lomborg won’t be speaking on Australian campuses is false, a fact which was certainly known to Lomborg’s sponors, the Institute of Public Affairs, which obviously supplied McGuinness with his information. Lomborg will be speaking at the University of Queensland on October 1 (unfortunately, I’ll be in Canberra, at the Conference of Economists). When challenged on this blatant falsehood by Paul Norton of Griffith, the SMH provided the following response

Dr Jennifer Marohasy who provided some of the information about Lomburg to Paddy had the following experience when arranging for him to speak. PAddy did not have this most recent information when he wrote the article. An extract of Dr Marohasy’s email is included here.

When I (Jennifer Marohasy) first broached the idea of him (Lomburg) speaking in Brisbane at the University of Queensland campus my contacts in the Life Sciences Faculty were unhelpful and uninterested – and concerned that such a lecture would be controversial and divisive! Thus we were to hold the lecture at Custom’s House, a University property, but in the city.

However, given the nature of Bjorn Lomborg’s work and the relevance of it to those studying ecology etcetera I ended up going back to the Life Science’s Faculty accusing one of my old PhD supervisors along the lines of your article – and it was throw back at me that I now work for a right wing organisation, politically motivated etcetera etcetera. However, in the end the University did agree to host the lecture and on campus.

The quibble about the Customs House is nonsense. This is the University’s standard venue for speakers of general interest – in the year I’ve been here I’ve attended half a dozen university events there, and spoken at a couple of them. Marohasy knew when she briefed McGuinness that Lomborg could speak at UQ if he wanted to. As Norton points, out in an email, Griffith University wasn’t even asked, although it has regularly hosted speakers whose views could be presumed to be unpopular.

Reading McGuinness’ piece as a whole, the striking feature is the implicit assumption that while it’s OK for Paddy and his friends to dish out the vitriol, it’s blatant victimisation when they get a serve of their own medicine.

Krugman interview

If you haven’t already, you should read Calpundit’s interview with Paul Krugman. For regular readers of this blog, there’s nothing new – unsustainable Bush fiscal policies imply financial crisis partly by resolved by inflation, with a consequent increase in interest rates, frequent mention of Argentina etc. But Krugman says it better than I do, and Calpundit shows new possibilities for blogging with a rare instance of primary newsgathering.

Managerialism and professionalism, again

Linking back to my last post on this topic, Leaderlog has an interesting piece on Why managerialism trumps professionalism. Key point:

Where professionalism at its best is meant to be a mechanism for making things happen with the least interference (which makes a lot of sense in a period of expanding public health and education), when political pressure swings around to preventing things from happening, an internalised ethos is no match for promises of transparency and control.