The STEEL-cameralist Manifesto Part 7: The Three Cameralist Systems and the Art and Science of Statecraft.

Fred

 Which was exactly the problem. Once Parliament decided that John Company was no more and India must be run for more ethereal reasons than mere profit, the fate of India as a colony was sealed. Once profitable government becomes charitable government, Third World status is only a matter of time. Like private companies, all countries disintegrate into bloated mush when run continuously at a loss.

Thus, colonialism cannot be restored by any mere subterfuge of rebranding. Its death was part of the slow decline of Western government, in which all institutions become larger and weaker. The postcolonial Third World state is a colony – in the sense of its political, military and/or economic dependency. It is just a very bad colony. It is bound no less closely to the West. All that has changed is that it is run as inefficiently as possible, which may cause some heartburn for its burgeoning army of Western managers – but certainly does not produce any hardship for them. The worse the business, the more managers it needs.

But we must remember colonialism, because colonial governments provided some of the highest-quality government in history. And, as Seeley points out, they worked on completely different principles than the democratic regimes from which they sprang. Froude once said that if Ireland could be made a Crown Colony, it would outshine England herself. He didn’t say what would happen if England was made a Crown Colony – but perhaps he was thinking it. Yes, my niggaz, there are lessons here.

From Cromer to Romer and Back Again: Colonialism for the 21St Century. Mencius Moldbug.

 

1: Introduction.

2: Cameralism, Neocameralism and STEEL-cameralism Compared and Contrasted.

3: Summary.

 

1: Introduction.

Imperial Energy has no time for ethereal reasons, only imperial ones.

In this post, we will compare and contrast the original cameralism with neo and STEEL cameralism.

The original cameralists purported to offer a body of practical knowledge, wielded by a cadre of professionals, in the art and science of statecraft. The primary reason that monarchs, such as Frederick the Great, had in developing cameralism was the need to have a strong and prosperous economy in order to raise enough  revenue so that they could wage war. Given our earlier look at how war drives the development of the state this is not surprising.

STEEL-cameralism, like the original cameralism, also shares this fundamental premise which is that the state is primarily organised for war and this final end (as it where) fundamentally and systematically conditions the entire state in terms of proximate goals and necessary means to ultimate ends.

Thus, one of the core principles of STEEL-cameralist statecraft is that economics is a matter of national (or state) security. STEEL-cameralist economics is heavily informed by “geo-economics” and councils that a state like USG must protect, develop and manage key, strategically important industries, for prosperity, power and peace.

STEEL-cameralism will thus have plenty of work for accountants, bankers, stock-brokers, entrepreneurs and corporate executives, as well as labourers, engineers, scientists, doctors and shop-keepers.

Peace here is understood as security. In order to become secure, one must become strong and in order to become strong, one must become wealthy.

In order for a state to become wealthy, it helps to be blessed with good geography and good or at least capable people; however, the most important thing is political and legal stability, predictability and responsibility.

What this means in detail will be explored and examined over the next several posts. Here, we begin by looking at all three cameralist systems and see how they resemble and differ from each other.

 

2: Cameralism, Neocameralism and STEEL-cameralism Compared and Contrasted.

The following extracts which describe and explain the original cameralism is from Christopher Hood’s  the Art of the State: Culture Rhetoric and Public Management chapter 4 part 3 the European State-Builders: Cameralism and “Policey Science”.

What follows is a compare and contrast exercise. First, we begin with the original cameralism, as described by Hood, and then neocameralism (NC) and finally STEEL-cameralism (SC). There are 14 points to cover.

 

1: Cameralism is a second set of classic ideas about the art of the state which broadly fits into a ‘hierarchist’ frame. The term denotes a body of European public-management ideas and practices which developed from the early sixteenth century and flourished up to the early nineteenth, after which much of it suddenly disappeared from view. It is particularly associated with the German states in the era of Christian (largely Protestant) absolutism, but also developed in Sweden, Austria, and Russia.

NC is explicitly based on rejecting imperium in imperio – a state within a state (multiple centres of political power and authority). NC is also premised on the assumption of the unification of ownership and control which is supposed to ensure political, legal and financial responsibility.

These two assumptions, according to Moldbug, are best realised in the design of a modern, for-profit corporation for that allows shareholders to hold CEOs responsible via selecting and supervising a board of directors who select and supervise, and if necessary sack, the CEO. The purpose of the CEO is to maximise revenue by providing “good customer service” via their power, which is quasi-absolute because they are  ultimately responsible (responsive) to the board and shareholders.

NC is, therefore, “hierarchist” and based on authority.

Arguably, a neocameralist state could not only be said to already exist but, in actual fact, pertains to the entire world and has done so for quite some time.

What might this be?

Answer:

The World Bank, which sees various nations’ voting power for board positions based on how many shares they hold. Furthermore, the current Chief Economist and Senior Vice President of the World Bank, Paul Romer, has advocated for “charter cities” that would be run in a similar fashion to a neocameralist state. Moldbug called Romer’s ideas “UR Lite, very lite.”

Mission complete then?

Well, not quite but it does offer one more political possibility proof (along with Singapore and Liechtenstein).

(In passing, one should point out that certain anti-Semitic charges against Moldbug’s positive proposals are unfounded, given that cameralism is of European “Protestant” origin and that the joint-stock corporation was first created in a Protestant nation (England) and came to fruition in the first, explicitly created Protestant nation (America).)

SC, like NC, also rejects imperium in imperio, but the expression of the concept here is that of unity of command and control. SC, therefore, is a marriage of the military and corporate structure. Perhaps the best way to understand SC is to view it as the offspring of a Private Military Company (PMC), and the British East India Company.

 

2: Cameralist ideas about public management came largely from practitioners—those who worked as councillors, advocates, and chancellors .

NC rejects the public/private distinction for the state is a business that owns a country and thus has a “primary property right” over all the land, property and equipment. Residents or “customers” have secondary rights. Essentially, they are renting from the state (this is one of the reasons why Moldbug described NC as a giant real estate enterprise).

Moldbug says very little as to the kinds of people he would consider worthy to wield power, except for some positive references to Steve Jobs. However, he also once mentioned Marc Andreessen and once (perhaps as a half-joke) recommend David Petraeus for president and once positively mentioned Erik Prince.

SC also rejects the public/private distinction and government is still a business; however, the chief idea of SC is tailored to a specific country, in a specific historical, political and economic situation. Ideal practitioners of SC would be the military , security and commercial elites – generals, strategists and military-techno- industrialists and, of course, lawyers. 

 

3: Cameralism is conventionally regarded as the first attempt in modern Europe to systematize the study of public management and to try to develop ‘principles’ of administrative science.

Moldbug’s work was an attempt to reason out a system and a set of principles from scratch. The topics covered involved war and diplomacy; economics and trade; education and the press; law, the judiciary and basic scientific research. Above all, however, Moldbug emphasized personal rule and judgement over abstract protocols and principles. Essentially, find the right person for the job and put them in charge.

SC is a modification of NC. SC recognises that a structure already exists and one must work with that structure; officers already exist and possess many – though not all – of the principles, expert knowledge, understanding and experience necessary for governing.

 

4: The three main elements of cameralist ‘science’ were economics, public finance, and ‘policey science’ (policeywißenschaft). The word policey (later polizei, and conventionally translated as ‘police’, although that word has narrower connotations in English) is said to have been drawn from Aristotle’s ideas about the conditions for promoting good order in society.

The main elements of NC correspond rather well to the above principles. NC economics are a synthesis of the ideas of Ludwig von Mises and Frederick List. Its key idea of public finance is to tax at the laffer curve via a Georgist tax; rejection of fractional reserve banking and a return to the gold standard; finally, NC places a high premium on order and also personal but not political liberty. NC is a police state – where modern technology and Victorian ideas are used to minimise criminality and violence – yet, the relationship between the state and the customer is based on a voluntary, legal contract (pacta sunt servanda.)

SC is a specific variant of NC in that it is a security state, with an emphasis on the concepts of imperial grand strategy and geo-economics. One way of conceptualising the difference between SC and NC is that NC is the state at peace but SC is the state at (permanent) war.

What about NC’s “voluntary contract”?

To draw from Kant, we can say that NC’s voluntary contract principle is a constitutive principle, one that actually obtains in the same sense that a marriage is constitutively successful if it has, in fact, lasted until death. With SC, however, the contract is a regulative principle; in other words, within SC, the idea of contract is a principle that regulates and guides practice, though the reality may never match the ideal. For instance, not all marriages last, though each person in the marriage acts as if it will.

In short, the ideal is to render, as much as practically possible and prudent, informal, involuntary relationships so that they are explicit, formalized and voluntary and therefore legitimate relationships.

 

5: Early cameralists, like Melchior von Osse, Christian Friedlieb, Dietrich Reinkingk, and Ludwig von Seckendorff, took a view of ‘good order’ as denoting harmony among the various unchanging ‘estates’ of society achieved through feudal justice. But, paradoxically, considering its conservative social origins, cameralism later came to develop a quite different view of policey emphasizing the state’s overarching role in transforming society, promoting general social welfare through state-led development linked to the extension of the state’s administrative, economic, and military capacity.

The NC state is very, very powerful, but also very small. Its goal is to maximise profit via the provision of political and legal security, stability and predictability for its customers.

One of Moldbug’s most distinctive claims is that the various problems of today are not social, cultural or moral in origin; the various problems of today (apathy, corruption, hedonism, and irreligion say) all have as their root cause a malformed political structure (Imperium In Imperio).

According to Moldbug, one must first fix the structure and then society will, as a result, be changed for the better.

Lastly and again, cameralism was explicitly linked to the state’s need for a robust military; NC, meanwhile, somewhat plays down that connection; however, SC makes that element central again.

 

6: Cameralist economics, which were essentially mercantilist, were supplanted by liberal economics in the nineteenth-century German universities. Cameralist public finance, on the other hand, largely survived and developed. Even today in German public authorities the word Kammer still means the all-powerful finance department. But cameralist ideas about ‘policey science’ and the associated principles of good public management altogether disappeared from the vocabulary from the mid-nineteenth century, as a law-dominated Rechtstaat approach to government became the new received vision of good public management (paralleling the demise of absolutism).

NC economics is also, if necessary, mercantilist. SC, however, is more explicitly and unapologetically mercantilist because the current circumstances require it.

 

7: Like Confucianism and the Chinese imperial system, cameralism and policey science helped to provide an intellectual underpinning for a particular type of regime—in this case, a state whose Christian princes aspired to be ‘God’s official’ and whose fragile legitimacy rested heavily on their administrative and military capacity.

The legitimacy of the NC state is based on the fact that it works – that it exists because it does and it continues to exist because it is profitable; it is profitable because it offers “good customer service” which is “good government”. Good government is strong, stable, rational, coherent and responsible government. Good NC government means confident investors and a growing base of customers; thus, NC is legitimate in the same way any major corporate entity (in theory) is.

The intellectual underpinnings of the NC state reduces, in the final analysis, to corporate governance – a system that does not presuppose any substantial background in a metaphysic, a philosophy or a religion.

The legitimacy of the SC state is exactly like that of NC. However, SC is particularly concerned with the material composition (manpower) of the state:  who is worthy to exercise power and authority? What is the most reliable, trustworthy, competent institution that currently or potentially can provide unified, coherent, responsible governance? The answer for SC is the military-industrial-security apparat.

The intellectual underpinnings of SC have already been worked over to a certain extent here, here, here and here  and will be further elaborated upon in subsequent posts.

 

8: It was no accident that the word ‘cameralism’ originates with fiscal management. Just as fiscal pressure is often held to be a key ‘driver’ of public management reforms today, raising taxes and managing state apparatus and property was the central administrative problem for the struggling seventeenth-century German states, impoverished by thirty years of war between 1618 and 1648, much poorer than their wealthy Dutch neighbours, and vulnerable to military intervention from neighbouring great powers like France and Sweden.

 It was also no accident that fiscal management was linked both to economics and ‘policey science’, since taxability is linked both to economic prosperity and to the governability of the populace (not just in general contentment, but also in administrative infrastructure, particularly in the form of accurate population registers). The revenue-hungry governments of that time needed to develop an administrative technology for exploiting the public estate (in the form of mines, farms and forests) and for collecting taxes, especially duties like the octrois (town-entry taxes) which monarchs could raise without approval of the estates.

The attraction of ‘policey science’ in such a context was that it purported to offer a design for the promotion of economic development (in the form of increasing wealth to underpin military strength) and for the construction of administrative systems which did not rely on the doubtful competence and loyalty of the traditional landed gentry.”

NC is a theoretical “design” that does not rely on the “doubtful competence and loyalty” of the university educated, “creative class” of academia, the media and the broader civil service.

In addition, NC asset management essentially comes down to three things: 1: Land; 2: Equipment; 3: People.

SC, however, favours “West Point” and “Wall Street” (with some “Silicon Valley” thrown in) over “Harvard”.

 

9: Policey science’ itself had several components—including very broad principles of constitutional or policy design (Verfassungslehre), tactical ‘advice to princes’ (Staatsklugheitslehre), and more specific ideas about government and administration (Staats- und Verwaltungslehre).

This is also true of NC. Its key principle of constitutional philosophy is the rejection of imperium in imperio and quasi-absolute, personal rule subject to a responsibility mechanism (the board of directors). NC (or UR at least) also purports to offer “tactical advice to princes” and broad principles of statecraft. For example, Moldbug recommends a non-interference foreign policy.

One crucial difference between NC and SC, however, is the recognition of a geo-political environment which is increasingly Hobbesian and Darwinist – one that decades of USG’s Wilsonian “democracy promotion” is largely responsible for bring about. Thus, “isolation” is not an option.

Secondly, and as regards “constitutional design”, SC takes as its premise the existing structure and explores how that structure could be adapted. Two areas of focus are the need to centralise power within the executive and to bring the governance of the states within its ambit, while preserving the freedom and spontaneity of the basic, federalist design.

 

10:  The last component, most central to public management, involved a broadly ‘professional’ and proto-bureaucratic vision of government.

Good public management in this vision involves staffing the state bureaucracy by permanent salaried middle-class professionals, recruited by examination rather than by patronage or sale of office (as with the adoption of civil service examinations in Prussia from 1770), and with a college training in economics and public management.

Professionalization goes with formalization, for good public management needs mechanisms for making sure that public officials carry out their duties properly and according to law.

NC not only is extremely critical of modern bureaucratic government and the salaried middle-class professionals who staff it but rejects this “vision of government” in its entirety.

Nevertheless, Moldbug said very little as to where a new “staff” might come from and how they might be trained. However, looking for such a thing is perhaps a mistake. Moldbug once described the role of the sovereign CEO as a “contractor of contractors”. Many talented people already exist and are capable of governance “straight out of the box” so to speak; thus, the task is to find them and given them enough power and responsibility to do what needs to be done.

SC, however, theoretically explores the training, experience and selection of such a staff which is similar to the Roman “course of honours” of antiquity. (The following is a good “data point” to consider.)

 

11: But much of cameralist ‘science’ rested on four key assumptions about state and society

First, the foundation of a strong state was assumed to lie in its degree of economic development, in the sense of overall wealth and the application of science and technology to agriculture and industry.

Economic development was stressed because of its link with fiscal power (taxability), and also with what would today be called the state’s ‘human capital’. Thus Frederick II of Prussia wanted to improve the health of his peasants, not just out of royal benevolence, but to sustain an army whose strength and stamina would match that of its French, Russian, and British counterparts. Such concerns led naturally to a preoccupation with diet, agricultural development, and a general view of government as a scientific ‘estate manager’.”

Both NC and SC agree with these assumptions, though SC places more emphasis on the end goal of military strength.

For SC, the state should be very strong and to be very strong it needs to very wealthy. To be wealthy, it requires having the right structure, human capital and a strong industrial, scientific and technological base.

Economics, national security and imperial power are thus inseparable.

 

12: Second, cameralists assumed economic development and social order does not happen spontaneously, but requires active management by government.

NC somewhat agrees with this principle, but in SC it is much more explicit. The American economic and industrial potential under the Hamiltonian system (often referred to as the “National system”) was not just left to chance – America’s key infant industries were protected and developed.

 

13: Third, it was assumed that to be equipped to promote development successfully, government needed a professional public service, unbeholden to any particular lobby or status group, and thoroughly schooled in the appropriate expertise—the sciences of public management and economic development.

Hence the route to professional administration was claimed to lie through ‘accredited’ college classes rather than on the job (in contrast to the view that public management skills cannot be learned from books and that it is better to recruit highborn people to public and military service than the money-grubbing and politically unreliable middle classes).

NC, as we have already noted, rejects this premise wholesale.

SC, on the other hand, premises itself on the claim that the senior executives and managers should primarily be from the military and from senior corporate management positions in the armament, manufacturing and energy sectors (and from other for profit corporations). The reliance on the lower to upper middle classes as technocratic managers of the state has proved a historical disaster. SC believes that America should be run by Alexander Hamilton’s “natural aristocracy” – men of proven ability from the military and commercial sectors who have some financial and emotional “stake” in the state.

 

14: Fourth, economic development was assumed to be a ‘positive sum’ game, from which everyone would benefit, not a process in which the gains of the winners come at the expense of the losers. As with the Confucian vision of good government, the society was portrayed as a family, indeed as a family farm, from whose development all the ‘family’ would benefit. Hence there could be no fundamental conflict between the ‘managers’ and the ‘managed’, and the interests of the two groups could not be separated.

NC also accepts this principle – at least in theory – that the self-interest of the state and the interest of its customers can be reconciled. SC, however, is more pessimistic on this score.

The bottom line is that the state needs money, manpower and machinery and the best way to achieve that is to, as much as possible, give people want they want – so long as they pay for it and assume the consequences of their imprudent choices.

The Art of the State: Culture Rhetoric and Public Management chapter 4 part 3 The European State-Builders: Cameralism and the “policey science.” Christopher Hood.

 

3: Summary.

The following is a summary of the main ideas of STEEL-cameralism.

1: It is a philosophy and science of statecraft.

2: It assumes the need for a professional elite who rule and not just follow rules.

3: This elite, unlike in the original cameralism, are not to be drawn from the university per se, or trained to be part of a permanent, technocratic civil service. SC moves away from “credentials” and “expertise” to experience and proven competence. The sources to draw upon are from the military and private sector.

4: All three cameralist systems are hierarchical. The first was in a context of absolute monarchy; the second, that of a joint-stock corporation and the third that of the military. All three have a philosophy of constitutional design. The first premise is the rejection of Imperium in Imperio or no structurally permanent competing power centres within the state. More specifically, it means getting the relationship between Elites and Essentials right.

5: STEEL-cameralism, unlike neocameralism, works with the materials it has and not with the materials it wants. Thus, the currently existing structure is the premise from which any theorising concerning a “restructuring” must begin with. Nevertheless, much remains the same: the view of constitutions or charters as voluntary, legal agreements and not “holy scripture”; support for legal formalism; a focus on profit and financial responsibility and not moral responsibility.

6: The first two cameralist systems emphasise “public fiancé”; however, the reason for this, in the first cameralism, was to support a professional military, this is downplayed in the second cameralism. With STEEL-cameralism, however, this link between economics, finance and warmaking is central once more.

7: STEEL-cameralism shares with neocameralism, though gives more emphasis to, mercantilist trade policies which spring from geopolitical and geoeconomic realities.

8: STEEL-cameralism adopt a self-consciously realist view of statecraft. However, “political realism” is a much maligned and misunderstood philosophy and subsequent posts will attempt to set out what is meant by our use of it.

9: STEEL-cameralism is an attempt to translate the ideas of the first two cameralist systems to an American context. The background assumption of STEEL-cameralism rejects “isolationism”, Liberal Internationalism (Tranzism) and its close cousin “Neoconservatism”.

10: STEEL-cameralism is a philosophy and groundwork for a science of statecraft for the American empire in the 21st century.  It is a political (anti) formula, one that will attempt to coherently rebut both Liberal and Conservative formulas and confusions as they currently exist. STEEL-cameralism is the fourth strand for neoreactionary thought, one that synthesizes earlier conceptions but develops its framework from the caste premise of a “soldier” and not a priest or a merchant as other strands of neoreactionary thinking have done.

Nrx is not dead or at least not quite, maybe it is becoming Srx (STEEL-reaction).

Next Time.

In subsequent posts, we have more to say about STEEL-cameralism. Next  time, we will have a real magnum opus for you where we take a look the nature, function and purpose of the sovereign in STEEL Sovereignty.

Questions and comments from readers are welcome.

Advertisements

21 thoughts on “The STEEL-cameralist Manifesto Part 7: The Three Cameralist Systems and the Art and Science of Statecraft.

  1. >NC economics is also, if necessary, mercantilist. SC, however, is more explicitly and unapologetically mercantilist because the current circumstances require it.

    You (and Moldbug) keep using that word, but I don’t think you know what it means. Mercantilism doesn’t mean “state maintains control over goods of strategic importance” or “state makes sure to achieve independence/expansionism and thus tweaks the economy to ensure that” or “state ensures there’s no unemployment because idle hands are the devil’s workshop” (indeed, the premier mercantilist power in the world, the French Monarchy had 8 million unemployed (!!!) on a population of 25 million, and keep in mind that back then unemployment wasn’t what it is today). Mercantilism means “do everything in your power (monopoly grants, exorbitant taxes, maximum wage laws, etc.) to ensure maximum extraction of money from the world at large.” Mercantilists prevented imports and encouraged exports, ultimately, not to employ people, or strengthen local industries, or whatever, but to prevent the flow of money from the country. Namely, mercantilists didn’t believe that wealth could be created (thus total disregard for consumer goods), and they believed that trade isn’t gain-gain, but gain-loss (the side that gets money wins, and the side that gains stuff loses).

    Like

    1. Four posts from now we have a major piece on economics and hopefully it will all be clear by then. We will be sure to be as clear as possible with what we mean by “mercantilism”. Our own working definition of “mercantilism” was “increase gold stocks” so perhaps, for the post to come, we could re-name it as “neo-mercantalism.”

      Like

      1. > “neo-mercantalism”

        That one’s already taken too. 🙂
        And so is neo-developmentalist.
        Politics really has a problem with severe lack of words.

        Like

      2. >STEEL-cantalism

        I like it. It’s consistent with your naming conventions, and doesn’t unintentionally associate to something else.

        Like

    2. “A general survey of the items of mercantilist policy shows that the champions of the mercantile system took their stand upon a high estimate of the importance of money, but that they did not esteem money as an end in itself; they valued it as a means to the promotion of commerce and industry, they valued it on account of its productive effects. “Money begetteth trade”, writes Thomas Mun, the mercantilist, “and trade encreaseth money.” Another member of the same school, Charles Davenant, puts the idea tersely as follows: “[Foreign] trade brings in the stock; this stock, well and industriously managed, begets land, and brings more products of all kinds for exportation ; the returns of which growth and product are to make a country gain in the balance.” * Colbert says the same thing from the outlook of the State financier: “If there be money in the country, the universal desire to turn it to advantage makes people set it in motion, and the public funds benefit thereby.”
      – Othmar Spann, “Types of Economic Theories”

      Like

      1. >they valued it on account of its productive effects

        Well, sort of. Mercantilism was first born when Spaniards brought gold from the New World and people witnessed the inflationary boom following it. However, mercantilists were against real productivity i.e. productivity enhancing technology — the established merchants already held the monopoly position, thus they had no need to increase productivity to increase their profits and new technologies if not in their hands meant competition for them. This famously lead to French Monarchy issuing a ban on new things, such as weaved buttons, printed calicos, etc. eventually leading to a mini civil war where literally thousands died in struggles over printed calicoes.

        Like

      2. I don’t deny that was the historical context that surrounded it, however, the views of the Mercantilists themselves seem to contradict the claim that Bullionism was the most central or primary element of Mercantilism.

        I would also argue that many chartered corporations and crowned corporations were what Peter Thiel calls “dynamic monopolies”, which seek to expand business and increase profits. I see no reason why there would be no need for technological innovation in this respect, as that could just be another way to cut costs.

        Alexander Hamilton was himself influenced by the mercantilists (often labeled a soft mercantilist), just as many protectionists were, and saw an explicit need for technological development in the manufacturing sector. And it was in the tradition of Colbert and his “grand projects” that High-Tech Colbertism was born.

        Like

      3. Ah, but ‘dynamic monopolies’ don’t need charters, that’s the reason they’re dynamic.

        New technology requires investment. It also requires new skills, which, of course, bothers the craftsmen with the old (thus new technology is quantitatively equivalent to cheap imports).

        Like

      4. Just because dynamic monopolies don’t need charters doesn’t mean they can’t have charters. The incentive to cut costs and increase profits is still there. You are right though, often times the old guilds of feudalism were threatened by the rising chartered and crowned corporations of absolutist imperialism.

        I would also argue that speculation and competition can often undercut growing economies of scale by pumping up newer businesses in the short term, despite their inability to decrease costs at the same rate in the long term. Such speculation leads to waste and debt being generated and results in a market of many smaller firms which can’t afford to maintain a lower marginal cost to the same extent as a monopoly could.

        Like

      5. Artist-Tyrant.

        Been reading some your recommendations. We read the Berlin essay; the letters on the Inquisition and the Hume chapter from Considerations.

        Sounds like quite a man. What is fascinating is his rational irrationalism. Much to agree with.

        However, just want to point out that his recommendation to Russia that it not develop science and commerce is, while understandable, a long-term looser if another power (such as the USA) is doing the opposite.

        Simply put, nations that do pursue science, technology and commerce, are going to be richer and stronger and it is they who are going to dictate terms.

        Despite that, there is a good deal to like to far.

        Like

      6. It’s interesting, because that’s one area of de Maiste’s philosophy that I don’t agree with. I agree with his analysis on sovereignty primarily, as well as his views on political violence, but I don’t necessarily agree that rationalism necessarily leads to individualistic chaos or that religions are essentially irrational, nor do I agree with his concession that Rousseau’s views are rational even if unrealistic. I definitely agree with your remarks on his suggestion to Russia. I also disagree with his support of free trade, though I’m not sure if he was referring to trade between colonies or nations in regards to his views on a favourable balance of trade, so I can’t be too resolute in that judgement.

        What strikes me as ironic about de Maistre is the way he lays down violence as a sacred and divine foundation in a slightly rationalist manner (as a justified true belief), and he builds a sound framework off of that. One thing worth noting is that Saint Simon (the first socialist) and de Comte (the first sociologist) were both influenced by de Maistre looking for the origins of power in a more secular conception of sovereignty instead of in the archetypical theological appeal to the divine right of kings (granted, these two conceptions are not mutually exclusive).

        Like

      7. > Such speculation leads to waste and debt being generated and results in a market of many smaller firms which can’t afford to maintain a lower marginal cost to the same extent as a monopoly could.

        Yes, monopoly is far more efficient than the market in case you need it to do known thing under known conditions. However, adaptability and error-correcting mechanisms of the market, despite inefficiencies arising from them, enable it to operate in complex and changing conditions.

        Like

      8. I don’t know if I would agree with that. I think that monopolies can invest their monopoly profits in R&D to a much greater extent than a smaller firm can, giving them a greater degree of dynamic efficiency, but also, giving them the opportunity to innovate and branch out into new markets (there’s something to be said for the homogeneity of profit in a perfectly competitive market where high time preference is permitted, and the volatility makes such a preference desirable (i.e people gravitate towards what makes them the most money the quickest, and that kind of capital gain sets the standard on wealth). Even indirectly, it is on the backs of major players and on the shoulders of giants that society at large has the purchasing power and leisure time to innovate in such a way that seeks to undercut major players. Frankly, on this topic, I don’t see why the state (as the strongest monopoly of them all (in theory)) couldn’t mediate relations between larger and smaller firms in order to create cartels, share information, and distribute profits.

        Like

      9. >I think that monopolies can invest their monopoly profits in R&D to a much greater extent than a smaller firm can, giving them a greater degree of dynamic efficiency

        They can, but experience teaches us that it is more likely it will be spent on bling when not under pressure of “market forces.” Furthermore, merely pouring money into it does not guarantee success. Two heads are smarter than one.

        Like

      10. I think that all depends on the kind of model of growth being pursued by the monopoly. I also think there are other ways to make sure monopolies stay competitive (like state incentives and punishments, as well as the risk of loosing privileges to another potential bidder if things don’t go according to plan).

        Like

Leave a Reply

Fill in your details below or click an icon to log in:

WordPress.com Logo

You are commenting using your WordPress.com account. Log Out /  Change )

Google+ photo

You are commenting using your Google+ account. Log Out /  Change )

Twitter picture

You are commenting using your Twitter account. Log Out /  Change )

Facebook photo

You are commenting using your Facebook account. Log Out /  Change )

Connecting to %s