Gestalt, the Libertarian Angle

[Liberal]

Thanks to the excellent arguments made by Spiritus and Erratum in the Gestalt thread, as well as the kindness of strangers at the Why Files, it seems clear now that the scalar/vector duality in nature is not a gestalt from quanta, since Heisenberg’s Uncertainty Principle actually applies in the macro world, but, due to the tiny magnitude of Planck’s constant, is merely insignificant.

But what about Hayek’s Theory of Spontaneous Order. Is a free society not a gestalt? Granted, you can make certain predictions (although not necessarily with much certainty) in strictly planned economies, but in a free-market, how will you ever be capable to predict the whole from the parts. Or, to put it in terms favored by Erratum, how will you ever attribute to each element of society the qualities of the whole?

[Spiritus_Mundi]

Setting asid ethe whole issue of whether things labeled theory in economics have the requisite testing and support to be considered reliable in the scientific context, it seems to me that you are again hanging the gestalt hat upon the state of human knowledge. Before I go further, though, let me ask for a clarification.

Are you saying that a free market is a gestalt based solely upon the idea that we cannot accurately predict the behavior of teh market in minute detail? If so, how do you see this as being a characteristic which is not found in the component parts (people).

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The best lack all conviction
The worst are full of passionate intensity.
*

[Liberal]

Actually, according the the Austrians, you can’t predict any of it. Not in a free market. That’s why F.A Hayek called it spontaneous order.

The characteristic of a free-market, objective order, is not found in the component parts, people, who make their economic decisions praxically based entirely on subjective criteria.

Von Mises argued that a free man, uncoerced, will decide to exchange what he was for what another man has when, and only when, he determines that what the other man has is worth more than what he has. If people exchange one apple for an identical apple, then according to Von Mises, no economic transaction occured.

[Erratum]

Lib, you are absolutely right that many simple interactions produce complex results that cannot be readily predicted, but also have perceptible “trends”, etc. In fact, this is an area of active research. It is the entire reason for being of The Santa Fe Institute. An excellent book on this topic is At Home in the Universe by Stuart Kauffman (should be available at Amazon.com).

I think you are assuming, however, that some mystical agency must be at work here. In fact, complex things arising from a bunch of simple interactions doesn’t require anything as obscure as quantum physics or economic theory. Follow this link, and you’ll see some java examples of this “complexity arising from lots of simple interactions” in very simple mathematical models. There isn’t anything magical or mystical about the math in the models on that page, the fact that complex and dynamic behavior arises when you get lots of simple interactions is just a simple fact of nature.

[Spiritus_Mundi]

Lib:
So, according to the Austrians (a school of which you have claimed membership in the past) it is entirely unpredictable. But acording to Hayek there is an objective order which allows for “some” predictability. Therefore it must be a gestalt?

Mob psychology is generally accepted to be simpler to predict than individual psychology. Does this “lack of complexity” represent a gestalt? I am still not certain I understand exactly what you are saying? Perhaps if you explained to me what objective order is clearly evident in the free marjket but never evident in the actions of individuals.

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The best lack all conviction
The worst are full of passionate intensity.
*

[Liberal]

Spiritus

So, according to the Austrians (a school of which you have claimed membership in the past) it is entirely unpredictable.

Huh? Membership?

Yeah, I guess if saying that I’m an Objectivist makes me a member of the objectivism philosophy, then saying that I’m an Austrian makes me a member of the Austrian School.

But acording to Hayek there is an objective order which allows for “some” predictability.

No, it doesn’t allow for any predictability. That is the whole underpinning of the Austrian School, that data about the elements of a macro-economy can not be organized in any useful way as information. Economic predictions, they maintain, are baseless guesses. Keynesian, and other non-Austrian economists, analyse discreet sequential snapshots of economic data, and make predictions and policy recommendations. The Austrians say this is a waste of time and resources, because the economy is as completely unpredictable as the irrational digits in pi.

Erratum

Yes, I agree that gestalt is natural. I’m assigning no mysticism to it, except to say that it appears to me, owing to its sheer simplicity, to be designed. There is no a priori reason that nature ought to work the simplest way. It just does.

I’m not saying that I believe God is a gestalt (He is a set of One, after all), nor am I saying that gestalt is supernatural. I’m only saying that it is a wonderfully simple way to make the world work.

[Spiritus_Mundi]

I guess I need to ask again.

I am still not certain I understand exactly what you are saying? Perhaps if you explained to me what objective order is clearly evident in the free market but never evident in the actions of individuals.

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The best lack all conviction
The worst are full of passionate intensity.
*

[Erratum]

Libertarian: “* it appears to me, owing to its sheer simplicity, to be designed.*”

Woah, simplicity implies a designer?! That’s a new one. I can understand why people might be might (erroneously, in my view) say “complexity implies a designer”, but simplicity?! Lib, you continue to astound me.

The purpose of your observation now completely eludes me. It reminds me of something one of the students once said in a philosophy class one of my friends took: “I mean just look around… look at that tree… how can you not believe in God?”.

Spiritus Mundi: “Perhaps if you explained to me what objective order is clearly evident in the free market but never evident in the actions of individuals.”

I assume he is talking about things like business cycles or the way inflation affects the economy, etc. The economy as a whole seems to respond to certain stimuli in certain ways, even though it isn’t always clear how each individual is reacting to that stimulus. (I, personally, find it interesting beyond measure that Lib trumpets this effect in an economy, but refuses to believe that a “society” is something that exists and is worth talking about. Societies are just as “gestalt” as economies, or the cellular automata in the page I linked).

[Liberal]

Spiritus

I am still not certain I understand exactly what you are saying? Perhaps if you explained to me what objective order is clearly evident in the free market but never evident in the actions of individuals.

The objective order is the economy itself. There is no objective order evident in single economic transactions, which are strictly chaotic and entirely subjective.

Here’s a nutshell version from one of Hayek’s obituaries:

As an economist, Hayek initially focused his attention on the development of capital theory, business cycle theory and the origin of money in the industrial order.

But his real legacy, which has touched each of us more than we will likely ever know, centers around a rather simple notion of spontaneous order of societal development. Its implications for politics and economics are immense.

Hayek borrowed the notion of spontaneous order from Adam Smith (remember “the invisible hand” of the market from Smith’s Wealth of Nations) and the Scottish natural law philosophers, who argued that society developed from a spontaneous order which was the result of human action but not of human design. Hayek, expanding on arguments advanced by the Scots, wrote that society developed through tradition and reason, concurrently. Both logical and practical, everyday experience influenced man’s advancement. The use of reason, however, was not limitless, being bounded by bias held by an individual or group. This meant that society was too complex to be created piece by piece in a strictly rational, logical manner.

Hayek argued that those who misunderstood or disregarded the notion of spontaneous order did so because they incorrectly divided the world into two categories: “planned” (which implicitly means order and purpose) and “unplanned” (which connotes disorder, randomness and chaos). Hayek argued that society, and its most advanced institution–the market economy–fit into neither category and, therefore, belonged in a third group. Each member of this third group would be bounded by rules, have its own order and increase in complexity in a way that would not be fully understood. Hayek’s best example of this third group would be our language. No single individual or group thought it up. It has its own rules of grammar, and language continues to evolve as mankind advances. Language could not be described in complete detail even if every computer was dispatched to this use.

The political implications of spontaneous order theory are strikingly evident with the recent fall of the Soviet Union. In fact, Hayek’s 1944 book, The Road to Serfdom, foreshadowed what we see and read about daily. No political system could assume, as fascism did on the right and communism did on the left, that men were cogs to be “fit” into the state machine. Tyranny results from government’s attempts to plan the workings of daily life.

The implications for the economy are even more striking. First, the very role of government economic planning comes into question, whether the issue is federal funding for highways or the use of taxes to influence investment decisions. It is only the unabashedly “free” market that can generate the signals for producers and consumers to trade. Any attempt by government to regulate prices, impose interstate or intrastate tariffs, or impose quality standards sends conflicting, inaccurate messages that have a discoordination effect in the market. This equally applies to a society like the former Soviet Union that desired complete planning or the local community housing authority that plans what type of homes will be built.

Second, reliance on institutions that were created through government fiat need to be questioned and reevaluated. Hayek, for example, grew increasingly disenchanted with a central bank as the sole authority for a nation’s money supply and called for competitive currencies that would eliminate monopoly control. A competitive currency would allow for all types of previously untried services for producers and consumers alike in a more uncertain environment. Monetary institutions would then evolve naturally rather than being artificially created by government.

Finally, Hayek would argue that centrally directed institutions neither have the wherewithal to keep abreast of all the relevant economic conditions of “the particular time and place” and be able to fully understand the information received. This means the policymakers may not be able to know all the relevant information to make decisions or may base decisions on old data no longer applicable. Only a spontaneously created market, resulting from hundreds of millions of valuations by individuals, would ensure economic vitality.

Erratum

Woah, simplicity implies a designer?! That’s a new one. I can understand why people might be might (erroneously, in my view) say “complexity implies a designer”, but simplicity?! Lib, you continue to astound me.

Why would you presuppose that God would be inefficient or complicated?

“Thank you, Father, for revealing these things to simple people, and for obscuring them from know-it-alls.” — Jesus

What astounds me is the fact that everything reduces ultimately to an identity, yet there is a pocket of vitality and complexity that thrives amidst the entropy.

I generally use complex and complicated as very different terms. What is complex is still simple underneath, like a crystal or a well written computer program. But what is complicated is unpredictable and chaotic underneath, like a lukewarm bowl of water or a computer program written with spaghetti code.

[Spiritus_Mundi]

Thanks for the info, Lib.

It seems to me that the objective order of teh economy is simply another example of patterns becoming evident only in scale. This is the cornerstoen of probability theory, among other things. After all, the individual economic transactions are subjective and chaotic in specific, but they are influenced and counded by a number of factors. Human beings within a context will reinforce ideas of worth and tend to compete for similar resources. While there is no “rule” that prevents my neighbor from trading me all of his 20’s for my 1’s because he thinks Washington wsa the better president, the sad fact is that it will not happen often enough to create a blip in the national economy.

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The best lack all conviction
The worst are full of passionate intensity.
*

[Nen]

Originally posted by Libertarian:
Why would you presuppose that God would be inefficient or complicated?

A quick question for you Libertarian: Does libertarianism (should that be capitalized?) maintain that there is a god? If not, you can’t assert that gestalt from the libertarian perspective is simple in design because (G)od wouldn’t have made things complex. If so, aren’t (G)od’s ways supposed to be “mysterious.” Bear in mind that I’m not trying to turn this debate into something theological in nature; I’m just not well informed about the precepts of libertarianism.

[Liberal]

Spiritus

It seems to me that the objective order of teh economy is simply another example of patterns becoming evident only in scale. This is the cornerstoen of probability theory, among other things.

But the patterns are not predictors of any arbitrary economic praxis between individuals. More on that in a bit.

After all, the individual economic transactions are subjective and chaotic in specific, but they are influenced and counded by a number of factors.

You’ll need to clear up the “counded” typo because I can’t figure out what you meant from the context, but an single economic praxis is influenced by one, and only one, thing, which I believe I explained, but will do so again, since I am sensing a genuine debate beginning.

(Note: it is well worth clicking the following link, if only to read the reviews even if you don’t order the book.)

In his magnum opus, Human Action, Ludwig von Mises proved that when Mr. Smith believes that what Mr. Jones has is worth more than what he himself has, and when Mr. Jones simultaneously believes that what Mr. Smith has is worth more than what he himself has, and both are free from coercion, and both are rational people who may exercise their volition, they will enter into an economic praxis (i.e., deliberate action or inaction) Their own judgement is the only influence on the transaction, even if the judgement itself is influenced by something else.

Human beings within a context will reinforce ideas of worth and tend to compete for similar resources.

That sounds Keynesian. Can you provide a cite, please? Or else prove it deductively?

While there is no “rule” that prevents my neighbor from trading me all of his 20’s for my 1’s because he thinks Washington wsa the better president, the sad fact is that it will not happen often enough to create a blip in the national economy.

That’s a straw man.

Of course almost no one would make such a trade, but even if they did, there would be nothing economic about it. The man knows (or should know, if he is rational) that he can simply get change for a twenty and have lots of Washingtons.

But real economic transactions are often much more surprising than your example. You need watch just one episode of the Antiques Road Show to get some idea of how arbitrary and unpredictable peoples’ idea of value can be.

[Liberal]

Nen

A quick question for you Libertarian: Does libertarianism (should that be capitalized?)

Only if it begins a sentence.

maintain that there is a god?

Libertarianism posits nothing about any god. It is nothing more than opposition to the initiation of force and fraud.

If not, you can’t assert that gestalt from the libertarian perspective is simple in design because (G)od wouldn’t have made things complex.

I did not raise the idea of any mystical agency. I responded to Erratum’s post about it.

If so, aren’t (G)od’s ways supposed to be “mysterious.”

I don’t think they’re very mysterious, unless you look at them from some frame of reference other than His. But that’s my personal opinion.

Bear in mind that I’m not trying to turn this debate into something theological in nature; I’m just not well informed about the precepts of libertarianism.

Well, click the above link for an excellent introductory essay.

You can find more resources at this site.

[Spiritus_Mundi]

Lib:
“counded” was meant to be “bounded”. The statement is simply a rflection that individual ecomonic transactions, while chaotic and unpredictable in their particulars can be predicted to fall within certain very wide boundaries. The 20’s & 1’s example was not a straw man (I was not posting it as being representative of your position and then knocking it down.) It was simply an example of a “conceivable” economic transaction that we could both agree was so unlikely to occur that it could be dismissed as an element of the overall economic pattern. BTW – I have watched The Antiques Road Show. To me it seems an excellent example of how ideas of value are influenced by the opinions of other human beings within a particular context. Nobody tries to argue that your grandmother’s ugly wooden table is worth $10,000 because of teh quality of workmanship, the intrinsic beuty, teh value of aged teak, etc. They tell you how much it is worth based upon what other people sho are interested in such items have been paying for it recently. If course, the only way to know what it is actually worth is to sell it, and that only tells you what it was worth to the two principals at that perticular instant of time.

Their own judgement is the only influence on the transaction, even if the judgement itself is influenced by something else.

Humans beings do not exist in a vaccuum. Saying that their two judgments are the only factors, though those judgments might be subject to other influences is like saying that the only factors that determine who won a war are the judgments of the negotiators of the surrender. It may be true in some sense, but it certainly fails to convey the complexity of the context. The man selling his house below market value because he is about to lose it to foreclosure has some significant “outside factors” influencing his decisions.

Human beings within a context will reinforce ideas of worth and tend to compete for similar resources.

That sounds Keynesian. Can you provide a cite, please? Or else prove it deductively?

I have never read Keynes, but I am not surprised that this thought has been expressed before. If I track down a reference where Keynes made that assertion would you be satisfied?
I know of no way to prove it deductively, since it is in essence a position based upon observation and deduction. I can cite numerous examples of this trend in my own experience. I can also pooint to price guides which exist for nearly every product that has ever been deemed valuable and/or collectible. Is the Tickle-Me_Elmo craze sufficient? How about Pokemon cards? Diamonds as a precious commodity? Decorative objects within any society? Bound feet in Imperial China (for those who wish focus on teh economic transaction of marriage)? I do not know whether this is seriously an area of contention for you or if you are just tweaking my nose after our exchanges on the Straight Dope Syndrome thread. Either case is fine with me.

The best lack all conviction
The worst are full of passionate intensity.
*

[Nen]

Lib, thanks for the links. I’ll shut up and do my homework.

[Erratum]

Libertarian: “Why would you presuppose that God would be inefficient or complicated?”

I wouldn’t presuppose a god in the first place. Furthermore, I wouldn’t presuppose that efficiency and simplicity were the same thing.

“What is complex is still simple underneath, like a crystal or a well written computer program. But what is complicated is unpredictable and chaotic underneath, like a lukewarm bowl of water or a computer program written with spaghetti code.”

I believe that researches generally refer to these phenomena as “complex”. In Kauffman’s book, he described phenomena as part of a continuum – on one end you have rigid, unchanging things like crystals, and on the other end you have chaotic things completely devoid of order. In the middle, between the two extremes, you have complexity. I believe this usage is in line with other researchers into the topic.

Nen: “Does libertarianism (should that be capitalized?) …”
Lib: “Only if it begins a sentence.”

Or, if you are refering to the school of thought advocated by the Libertarian party (the philosophy advocated by Libertarian on these boards). They (and he) would like you to think that the planks of the Libertarian party platform and “libertarian” thought are the same, but they have not successfully made that case.

[hardcore]

Lib, I have to challenge you on a couple of items.

I’m assigning no mysticism to it, except to say that it appears to me, owing to its sheer simplicity, to be designed. There is no a priori reason that nature ought to work the simplest way. It just does.

Claiming that it appears to be designed certainly sounds like mysticism to me! But I don’t agree that nature always works the simplest way. There is too much evidence of vestigial structures and jury-rigged design. Nature doesn’t work the simplest way. Nature makes do with whatever it has available.

[Liberal]

Spiritus

Spiritus, I’m not sure but what we’re not talking past each other again. This is one of those cases where I don’t necessarily disagree with precisely what you say, but I think I might disagree with what you think is the implication of it. Know what I mean?

The statement is simply a rflection that individual ecomonic transactions, while chaotic and unpredictable in their particulars can be predicted to fall within certain very wide boundaries.

Well, yeah, but very very wide indeed.

So wide that it’s a so what. Each individual economic transaction falls within the universal set of economic transactions. But that’s about the only meaningful thing you can conclude about an economic transaction, that it is one.

You can predict nothing about the larger macro-economy from it, and nothing about its nature, unless it is (1) planned, or (2) coercive. Though I accepted the word for argument’s sake, I don’t think chaotic is the right word to apply to an economic transaction, unless we agree that we don’t mean baseless. It is based on the subjective considerations of the economic parties.

If all the parties in the universal set of parties are left free to exercise their own best judgement and volition, you can predict nothing about the macroeconomy simply because you cannot make extrapolations either fast enough or reliably enough. As Hayek explained, once you’ve examined the data, it is already old. And whatever significance you attribute to the data is entirely arbitrary. That’s why the economy springs so many surprises so often despite the ubiquitous Jeanne Dixoning undertaken by so many Keynesians.

Yeah, they get a lucky hit no and again. Like any blind pig. But if you examine their actual predictions with the actual results, you will see them applying a sort of Nostradamus factor. They attributed the recession of the 80s, for example, to their prediction in the 70s that stagflation (which submarined them entirely) would resolve into either growth or recession. Wow! And they were right!

Saying that their two judgments are the only factors, though those judgments might be subject to other influences is like saying that the only factors that determine who won a war are the judgments of the negotiators of the surrender.

Interestingly, I think that, under certain extremely unlikely conditions, a surrender negotiation could qualify as an economic transaction by Von Mises’ criteria, assuming the two negotiators are free to exercise their own volition. One might think the end to violence offered by the other is worth more than continuing the violence himself, and vice versa. And assuming that neither party is being coerced into the surrender.

HardCore

Claiming that it appears to be designed certainly sounds like mysticism to me!

I don’t see what’s mystical about it unless you begin assigning attributes to the designer.

Just because the designer is a mystery, that doesn’t make it mystical, any more than scientific speculation about the mysteries of cosmology.

The simple statement that a quality set implies intelligent design is no more mystical than the statement that a quality set implies worm holes. Until the designer is know, it is simply a puzzle for philosophers. Until a worm hole is found, it is simply a puzzle for mathematicians.

But I don’t agree that nature always works the simplest way. There is too much evidence of vestigial structures and jury-rigged design. Nature doesn’t work the simplest way. Nature makes do with whatever it has available.

Yep. And that sounds like the simplest way to do it, to me.

Erratum

They (and he) would like you to think that the planks of the Libertarian party platform and “libertarian” thought are the same, but they have not successfully made that case.

That is factually erroneous. Particularly the “and he” part.

You won’t have to search too hard to find my denunciations of the Libertarian party as compromising and its candidates as the least of the evils at best. Harry Browne is a statist. Most party members are actually constitutionalists rather than libertarians. You’d be surprised how many have never even heard of the Noncoercion Principle.

[hardcore]

Lib, you are probably the most adept poster at having it both ways. Are you now stating that evidence for evolution implies a (possibly non-mystical) intelligent designer??!!

The simplest way to catch a mouse is with a mousetrap. Nature evolves a cat.

[Spiritus_Mundi]

Lib:

Each individual economic transaction falls within the universal set of economic transactions. But that’s about the only meaningful thing you can conclude about an economic transaction, that it is one.

And yet you immediately decided that my neighbor trading me 20’s for 1’s was not a “good” example of an economic transaction, and I agree with you. Your point above is technically correct, but in the real world we are safe in assuming that most economic transactions will satisfy other criteria: the restriction of rationality, for example. My point is that these further traits of economic transactions stem from those elements which can be generally applied to the population of the economy in question.

you can predict nothing about the macroeconomy simply because you cannot make extrapolations either fast enough or reliably enough. As Hayek explained, once you’ve examined the data, it is already old. And whatever significance you attribute to the data is entirely arbitrary.

This argument is based upon limits in technology and information flow. I am not saying that a free market might not remain unpredictable even if near-instantaneous data collection and correlation were practiced, but there is nothing in this particular argument to support that conclusion. It seems once again that your example of gestalt is (or might be) dependent upon the state of human knowledge/technical ability.

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The best lack all conviction
The worst are full of passionate intensity.
*