Human Nature

Why Darwinian Economics Is so Threatening to Libertarians

How the science of evolutionary competition influences economic outcomes

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By George Cooper

Before Copernicus, mankind knew that the earth sat motionless at the very center of the universe with the sun and stars turning around it. After Copernicus, we knew the earth was just a minor planet orbiting an unremarkable star. He was the first of the scientific revolutionaries, but he was not the last. He has been followed by a long and glorious list of imitators. These copycat revolutionaries borrowed his scientific methods and to a surprising degree also used very similar imaginative tricks to turn their own fields into sciences.

It is worth pondering what Copernicus did and what he did not do. Copernicus did not make any new astronomical observations of significance. His breakthrough did not rely on new mathematics or other astronomical techniques. He did not produce a more accurate astronomical model than the previous Ptolemaic system. He provided no experimental demonstration that his model was superior to the Ptolemaic system.

All that Copernicus did was to describe the universe in a simpler, more logical way. Copernicus provided conceptual efficiency. His triumph was in the elegance of his model, which allowed subsequent workers to think more clearly. What economics needs today is a similarly simplifying paradigm shift enabling us to begin thinking more clearly about the way our economies really work.

Drawing a parallel between the confused state of economics today and the state of astronomy prior to its revolution, I argue that trying to fix the confusion in economics requires that we dig down to the level of paradigms—in the manner outlined by philosopher of science Thomas Kuhn. This article takes the paradigm offered by Darwinian evolution and shows how it can help clean up some of the mess creating divisions among the mutually incompatible schools of thought that splinter the field of economics today.

If we accept, as I suspect most educated people do, that humans are the product of a long succession of evolutionary pressures, then we must logically concede that we have inherited traits from our ancestors. Furthermore, we must accept that our ancestors had to compete with their peers for resources in order to survive and that we are the product of whichever humans happened to be the best competitors. Darwinian evolution is therefore itself the most powerful reason to believe that we have evolved an innately competitive spirit. Certainly we are smart enough to coordinate our decisions into cooperative rather than competitive behaviour, but even this is often to foster competition at a group level rather than an individual level.

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When we were evolving on the planes of Africa into the tribal, social animals that we are today, was it more important that we were able to run fast or that we could run faster than our neighbour? My guess is that when a lion was looking for lunch, the most important thing was not to run fast; it was to run faster than the person next to you. That is to say, it was the ability to compete successfully that ensured survival.

The issues that Darwinian competition throws up for the Neoclassical and Marxist schools of economics are interesting but what it implies for the Libertarian school is positively fascinating. The Libertarian paradigm is one in which the ideal economy will arise out of a social system as close to a natural one as possible. To the Libertarians, a world of minimal government interference – with little or no taxation or regulation – is optimal. In this world everyone is free to get on with their own life, free to do the best they can.

It is a lovely story; I certainly found the idea initially appealing. Unfortunately, there is the nagging problem of the experimental data, which somehow just does not chime with the Libertarian ideal. Afghanistan and Somalia have got little in the way of government and regulation but they are hardly the utopian power houses of economic progress described by Libertarianism. I shall be brave here and boldly state that there is not one example of a successful society run along Libertarian principles on earth today. What’s more, I can confidently state that there never has been and never will be such a society. The reason for this is the darker side of our Darwinian nature.

The neoclassical economists often talk of their models as representing competitive processes and often argue that their theories are built in accordance with the natural competitive forces recognised by Charles Darwin. But when they come to actually do the mathematics, they do not model competition; they model maximisation. There is a very good reason for modelling the economy using the assumption of maximisation rather than competition. Modelling maximising behaviour is trivial, modelling competitive behaviour is fiendishly difficult.

Let’s say, for example, that you want to build a model to predict the next 100 meter time for the fastest human live, Usain Bolt. If you wished to model this as a Neoclassical economist would, you might take the results of his last ten races, plot the results on a chart and take the average. If you wanted to be a bit more sophisticated, you might even fit a line through the points and extrapolate his next result. Either way, all you need to know about is Bolt himself. On the other hand, if you want to model Bolt as a competitor you need to know about everyone he is racing against. If he is racing against the second-, third- and fourth-fastest sprinters in the world, your model should predict a time that is just a bit faster than any of those runners could run. If he’s running against three blokes he happened to meet last night in the pub, the model should predict a much slower time. But then again, if one of the people in the pub happened to be fellow Jamaican sprinter Yohan Blake, the model would have to be adjusted again.

Hopefully the point is clear. Modelling a system in which each of the components are engaged in maximising behaviour is relatively simple, modelling a system in which each of the components is engaged in competitive behaviour is very difficult, and at the level of the economy it is effectively impossible. In a competitive system, the actions of each individual component are dependent on those of all the others. Not only is more data required, but spontaneous complicated group behaviour, feedback effects and herding all become real possibilities.

The core idea of the neoclassical school of economics is to build mathematical models to describe the economy based on fundamental principles. It is worth revisiting those principles:

  1. Individualism: people make their decisions independently of one another based on their own self-interest.
  2. Maximisation: the decisions made by individuals are always designed to maximise their own welfare.
  3. Equilibrium: the result of all of these individual optimising decisions is a stable system in optimal equilibrium.

Consider for a moment what happens if we replace maximisation with competition. Competition, as discussed, is fundamentally a relative not an individualistic process. So the first principle of individual decision making will have to be discarded. But if we introduce competition and discard individualism can we be sure of retaining equilibrium?

So we have a problem with the Neoclassical school of economics that is quite fundamental. The problem lies not with the details of its models but with its core axioms. If we humans really behave as competitors rather than optimisers, all three of the axioms of mainstream economics are simply wrong. Recall that when Copernicus changed only one of the two axioms of Ptolemaic astronomy he ended up changing the whole of the science of astronomy. If we adopt a Darwinian competitive paradigm we have to change all three of the axioms of economics at once.

Making this intellectual shift threatens the school of Neoclassical economics. It also threatens the naïve Libertarianism of economies that operate free from institutional supports (regulation and taxation consistent with human social behavior)—all because of a basic confusion about the difference between competition and maximization.

I believe economics is ready to become a proper science. But first, we’ll have to systematically critique the shortfalls of all political ideologies to show where they are consistent with the science and where science and ideology diverge from each other.

This article draws upon writings in Money, Blood, and Revolution: How Darwin and the Doctor of King Charles I Could Turn Economics Into A Science where a case is made for the field of economics to go through a “paradigm shift” transitioning from pre-scientific confusion to properly-scientific coherence as a field of study. Before it can do this, I argue, resistance will have to be overcome from ideological camps—and particularly, Libertarians, whose views of Darwinian evolution are often misinformed.

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  • Scott Littrell

    Not sold on the Afghanistan and Samalia example. Lots of war, genocide, and theocratic regimes. Henry the 8th had a “small” government compared to today but he had a the power to control the economic, social, and moral lives of his people. I would like to differentiate “small” government from “limited” government. It’s more of a political philosophy than economic policy, meaning its more about freedom of speech, association, etc.

    I do agree that a pure free market is utopian but not all libertarians are anarcho Capitalists or of the Austrian School. Most of us subscribe to a variation of neoclassical economics but with strong Individualist sentiments and skepticism of direct government intervention. The fact that not everyone values individualism as much as libertarians is proof that utopia can’t exist. But the same can be said for Socialist utopia, not everyone values egalitarianism the same as a socialist thinks they ought to.

    I’m also not sure economics can be a science, the foundational observations that become theory are normative in nature, think of Expected Utility. The Statistics used to prove economic theories are a science and the scientific method is definitely taken seriously. But I’m not certain that human behavior, specifically rational choice and self interest, can be a proper science. But I am curious to learn your take on this.

    • The axioms the statistical methods are based on are not taken seriously though. They are simply assumed to be true.

      Statistics is used solely to give the air of respectability to the working. Anything with mathematical formula in it looks scientific. Scratch the surface though and you find people who couldn’t even describe what the required preconditions are to using statistical techniques.

      • Scott

        Totally agree with your statement. Even if one knows the preconditions they are likely to ignore them for the sake of a good result.

    • What is rational and in ones self-interest are based on the values of the person or group that is making the economic choice. Economics is a way to understand the world, the decisions that people make. Within the field of economics, there are certain laws that always work in the real world, simular to what most people think of as science. But even in science there are cases where the normal law of science do an apply, like when you get near absolute zero. Economics can be applied to almost any rational decision where a choice has to be make. What makes economics differcult, is that not all people have the same values as you point out above, so what is “rational” in th eyes of one many not be in the eyes of another. Science cannot explain why gravity works, Hense science can be very limited in what it try’s to explain, Economics have simular issues.

  • Diego Soares Cardoso

    True, but only until you realize that Game Theory and Behavioral frameworks are also mainstream. You will find competition, cooperation and bounded rationality even in very “aggregate” macro models being published in top journals. Careful not to attack the straw man…

  • Dunbar

    An appeal to “science”, namely “Darwinism”, is folly (like all appeals to authority). Human relationships are a complex interplay of ever shifting power relationships. Economics is a human construct, it cannot be separated from power; indeed, it is concomitant with power.

    At the heart of the problem is the notion economics reflects something “natural”, that it is akin to a physical science. Divisions of labour, production and distribution of resources are expressions of power, they are not “naturally” occurring – intrinsically benign – phenomena. If we strip away the overt institutions of power (government, military, police) we are not left with a level playing field of producers and consumers; stark inequalities in power within “civil society” remain, these inequalities inevitably affect the allocation and distribution of resources.

    The subject of economics needs to be rebuilt from the ground up within a wider framework of social sciences, in its current form it provides a dangerously distorted picture of reality.

    • Power is the name of the game where the state allocate resources …. In a free market, or to make some reader happy, in a freer market allocation are made base people wants and abilities. Economics does take into account many social values …. People make their decisions base on various social values they have developed or learned. If one wants to go the BIBLE it is best understood from an economices view point of giving up things of lessor value for things of greater value …. The hard part at times is knowing what is of lessor value and what is of greater value …. Hense, Jesus came to teach us what is of real value in the long run.

      • Dunbar

        No. Control of resources conveys power, regardless of the existence of a state. The anthropological record is testament to this fact.

        • Explain what you mean by “control”? Can a single person control a resource without the support of the state? Abthropologial record indecate that from the beginning of recorded time, that the State has almost complete control of all resource other than the O2 in the air, and those in the seas beyound the international limits. In 1776, the State had control of the tea that would enter North America.

          • Dunbar

            “Control” is the exercise of power. This could be the establishment of taboos and prohibitions via cultural norms, or, control via ritualistic belief systems: used to define the scope of actions individuals can take based on their status or their position within a ritualistic taxonomy (for example, only a shaman or priest can “crack the bread, drink the wine and dwell in the holy place”). In stateless societies individuals control resources through extended kinship networks: clans, tribe, etc…

            One of the most famous anthropological studies of stateless societies was Bronislaw Malinowski’s 1922 ethnography: “Argonauts of the Western Pacific”. Stateless societies still exist to this day in isolated communities in the Amazon rain forest. The state is actually a recent innovation; we have no written evidence of its existence further back than 7000 years ago. For some context, anatomically modern humans have existed for at least 200,000 years.

          • So, if I am in the woods alone, and I was to allocate (an economices decision) my resources (time) as to fishing in a river, or hunting for blue berries. You are saying that is an exercise of power …. If that is the case everything we do is an exercise of power. ……. Economics deals with the allocation of limited resources, and “power” does not always come into play. Since “Time” and personel energy ….. Are both limited resources. As for stateless societies, where there is a chief there is a state (king, chief, etc. are all forms of states) a small family unit would not be a state. So it would be petty hard to tell how many of those 200,000 years people were without rulers. I agree that the city-state and the nation-state are new to the human world.

          • Dunbar

            The scenario you’ve outlined above sounds like resources are held in common (no individual or group limits access to the river or the berries). The question you have to ask is: do your actions limit the access of others to a resource? If so, this is the exercise of power. In economics, where resources are controlled, power always “comes into play”.

            Stateless societies do not necessarily have formal leadership roles, many do not have any entrenched hierarchies at all. Frederick Barth’s classic study of tribesman in the Swat valley on the North West Frontier in the 1950s is a good example. “Leaders” (for want of a better word) must maintain their status in order to retain their “followers”. The latter are at liberty to switch allegiance to a rival leader, or adopt a position of neutrality. Hierarchies in this context are fluid.

          • Much of what you say applies to a corporation …. The CEO serves at the pleasure of the stockholders, and the employees are free to come or go. I served as the CFO of a corportion and I was often at odds with the CEO, had to take my case to the stockholders. ……. It was my job to maximize profits, which any society wants to do, since it means getting the most from limited resources. I established a system where the employees (a resource) would get 1/3 of the profits at year end, and 1/3 of the weekly estimated profits paid out weekly during the year. We did everything we could to limit our use of natural gas (another recourse). The Employees would tell me when they wanted me to hire another employee (which would share in the profits too), and when an employee was not worth keeping. As a result our production grew 300% and our net profit grew 200%. The corporation does all you want ……. except when it comes to resources from the Earth, and with those you have no workable method of allocation. SInce in a way they belong to either to the team that goes after them, or to the people of the world as a whole. Under Free Enterprise the person or team that bring the resource to the market (withing the rules set by the representative of the people) have control.right to the resources: under the system where the resources belong to all the people of the world, how does one ever gets consensus? That’s why I am a conservative, and not an anarchists. ….. You are right that there are a few places where arachist can live, but they too do not allocate resources as per the people of the world.

          • Dunbar

            Your synopsis of a corporation is devoid of any analysis of power.

            In a corporation the CEO has the ultimate power in its day to day running. The power of the stockholders is diffuse and can only be exercised under certain conditions. The CEO is an effective dictator; he can fire any of his subordinates, they cannot fire him. The power relationship is zero sum. At the end of each financial quarter the CEO is answerable to stock holders, who can dismiss him with a majority vote. This is a stark vertical power structure.

            In your “free enterprise system” access to resources is restricted by the legal status of an individual or organization: the legally defined “owner” controls the resource and they can choose how to respond to demand for that resource. There is a stark disparity in power between owners and non owners of resources.

          • It is clear you do not understands life in Corporations, the CEO, has a lot of power, the CFO is the counter balance, and should not be too close to the CEO…..more than once I had to go before the board, never lost a battle 🤗. Money, not ego talks. And even in the Army, performance counts. There more going on in the world, you see things in black and white…..Duty goes beyond the line you see.

          • Dunbar

            The CEO can fire the CFO. The CFO cannot fire the CEO. The power relationship is crystal clear.

          • No, the CFO often answers to Board directly. Like I said the CFO is often the balance to the CEO, and can bring a CEO down!

          • Dunbar

            The CFO is subordinate to the CEO. The CFO can only “bring down” a CEO if he appeals to the collective authority of the Board and stockholders.

            The power structure of a corporation is vertical.

          • The CEO must appeal to the Board too. in the same way. The real power is with the Chairman ….

          • Dunbar

            The power structure is still vertical.

            If the employees could fire the CEO the power structure would be horizontal.

          • The Vertical Structure often start below the Chief level. So the CEO, the CFO, and sometimes the COO are very different function, and play different roles, and for the protection of the Stockholder, the authority of the CEO over the CFO is very limited and some time non at all. Just like the person who makes the deposits should be a different person than the person that record the deposits: and the person who makes up the check should not be the same person who signs the checks …. In corportations at the top there is a check and balance system in place. The Corporation is owned by the stockholders, and the stockholders need to make sure that they are getting truefull information, and not have all of it edited by the CEO.

  • ari9999

    “My guess is that when a lion was looking for lunch, the most important thing was not
    to run fast; it was to run faster than the person next to you. That is to say, it was the ability to compete successfully that ensured survival.”

    This surmise may or may not be true, but conceptually it is poppycock.

    Evolutionary thinking has progressed way beyond simplistic nonsense like assuming, Ayn Rand-like, that “survival of the fittest” always refers to individuals and competition. As modern researchers and evolutionary theorists point out, “the fittest” just as easily refers to human groups and cooperation.

    The entire article seems framed, immersed, besotted in this culturally bound thinking — an outstanding and, I believe, unfortunate example of cognitive linguistics at work.

    “If we adopt a Darwinian competitive paradigm we have to change all three of the axioms of economics at once.” Again, that may or may not be true, but regardless: it ignores half or more of where Darwinian thinking can productively take us.

    Economics might indeed benefit from a paradigm shift. A framing that embraces all of Darwin’s vast and exhilarating legacy might serve us better.

  • David Whitlock

    The correct response to a lion on the plains of Africa was for several humans to pick up long spears and stay together in a tight group. With several people fending off the lion with those spears, a single person could throw fist sized stones at the lion. If the lion tries to get close enough to grab one of the spear holders, the others would poke out its eye. Lions with poked out eyes don’t do very well. Once the lions learned not to mess with groups of humans, then humans could waltz up to a lion’s kill and hack off as much as they could carry back to their camp. Letting humans carry off 50 pounds of meat isn’t worth losing an eye or two.

    Cooperation between puny humans could out compete the “king of the beasts”, 100 out of 100 times. Often enough that lions learn to not even try.

    • Right. Cooperation is the thing that got us to the top of the food chain. Full stop. Competition is only virtuous to the extent that it promotes cooperation.

      • David Whitlock

        Yes. Running faster than your conspecific is the strategy of wildebeest. If that is the strategy that our ancestors used, that is what we would have evolved into.

        Being able to run fast and having sharp pokey horns does deter the slowest and weakest lions, but then they evolve to be faster and stronger. Adult wildebeest eventually senesce and die, surrendering their biomass, enough to support a small population of even slow and weak lions. That small population of slow and weak lions can then evolve to be faster and stronger, and with a large population of eventually senescing wildebeests, has the biomass to do so.

        The modern financial sector is akin to a voracious hoard that consumes all resources in its path, and leaves no resources to support its victims while they evolve. It has now bankrupted children with student debt even before they can earn anything.

        What selective pressures is this “economic Darwinism” causing to evolve? The only thing that matters now is inherited wealth. If you inherit enough, you can hire people to game the economy for you and increase your wealth at the expense of everyone else. If you don’t? Then you can work for minimum wage while on food stamps and welfare, die early from no health care with no children, or with children stunted from lack of food, healthcare and education. Then the hyper-wealthy will be compelled to consume the not-so-hyper-wealthy.

  • Paul van Wijk

    What if survival is not about being the strongest but about being the most adaptive? What if outrunning your mate to prevent being lunch is not that smart and collaboration would be much better? What if it is not the individual competition but the collaborating collective that helps the human race survive? Then how would the economic model look like if we follow the Darwin-approach?

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  • Swami Cat

    “The issues that Darwinian competition throws up for the Neoclassical and Marxist schools of economics are interesting but what it implies for the Libertarian school is positively fascinating. The Libertarian paradigm is one in which the ideal economy will arise out of a social system as close to a natural one as possible. To the Libertarians, a world of minimal government interference – with little or no taxation or regulation – is optimal. In this world everyone is free to get on with their own life, free to do the best they can.

    It is a lovely story; I certainly found the idea initially appealing. Unfortunately, there is the nagging problem of the experimental data, which somehow just does not chime with the Libertarian ideal. Afghanistan and Somalia have got little in the way of government and regulation but they are hardly the utopian power houses of economic progress described by Libertarianism. I shall be brave here and boldly state that there is not one example of a successful society run along Libertarian principles on earth today. What’s more, I can confidently state that there never has been and never will be such a society. The reason for this is the darker side of our Darwinian nature.”

    You are conflating libertarians and anarchists (I am neither, but am at least able to distinguish the two). Libertarians emphasize freedom and non-aggression. In general, this leads them to recommend a minimal state for defense, courts, rule of law, public goods and such. A small branch of more extreme libertarians, including David Friedman, recommends anarchy or the dissolution of the state altogether. In their highly speculative model, they see defense, rule of law, courts and redistribution as being not absent, but built up from voluntary interactions. There are no libertarian anarchist states yet. It is simply an ideal which they believe can be built. I wish them the best of luck in their endeavors, as we can all learn from any models they prove or disprove. To equate Friedman’s ideas with Somalia, is either dishonest or ignorant. I will let you choose.

    “Making this intellectual shift threatens the school of Neoclaissical economics. It also threatens the naïve Libertarianism of economies that operate free from institutional supports (regulation and taxation consistent with human social behavior)—all because of a basic confusion about the difference between competition and maximization.”

    Libertarianish writers have been assaulting these same assumptions since before World War Two. Indeed your argument on modeling is somewhat of a restatement of the knowledge problem which Hayek stressed. Would you like a suggested reading list?

    To be honest, I do not believe there is any mainstream libertarian support for an economy “free from institutional support”. I suppose you can find some lunatic fringe somewhere, but if so, identify it as such, and we can all join in a good laugh at their expense. The mainstream of libertarian thought is that institutions and values are essential to markets. I repeat essential. It is called property rights, contract law, rule of law, courts, and so forth. These are institutions.

    Yes, libertarians believe in less state involvement in these institutions rather than more (with some arguing theoretically for no state involvement). But this and your comment on Somalia just shows you are confused on the issue of institutions and state-supplied institutions. They are not the same thing, though they can and often do overlap (and many and probably most libertarians admit to the need for the overlap).

    My parting thought is that I think you are confusing serious libertarians with “high school students and prog-rock groups who read a couple of absurd Ayn Rand novels.” Can I suggest you stop arguing with straw men and actually send your thoughts to the real people at Cato, or Bleeding Heart Libertarians, or the Mises Society or wherever. I might even join you in the discussion on your side. And again, I am NOT a libertarian or an anarchist. But I am at least informed on their real arguments and positions.

    • David Whitlock

      Markets can only work when their are no unpriced externalities. Markets are completely unable to deal with unpriced externalities because they don’t fit into a market.

      The typical “Libertarian” response to unpriced externalities is to ignore them and deny that they exist (hence the denial of Anthropogenic Climate Change by Libertarians).

      • Swami Cat

        I am sure I can google hundreds of articles and references by serious libertarians on how to address externalities. I have read more than I could ever remember.

        In brief their response is that non market mechanisms should be adopted to deal with these externalities, or that they should be priced by things such as credits which can be traded.

        Can we keep the discussion serious, please?

        • David Whitlock

          So why hasn’t the externality of putting CO2 into the atmosphere been addressed?

          David Koch was the 1980 Libertarian candidate for VP. He is the poster child for AGW denial. He and his brother Charles Koch are responsible for much of the deliberate disinformation put out there on AGW. Charles Koch founded the Cato Institute. Is he a “serious” Libertarian?

          • Swami Cat

            A quick search of the Cato site reveals the following position:

            “Global warming is indeed real, and human activity has been a contributor since 1975. But global warming is also a very complicated and difficult issue that can provoke very unwise policy in response to political pressure. Although there are many different legislative proposals for substantial reductions in carbon dioxide emissions, there is no operational or tested suite of technologies that can accomplish the goals of such legislation.
            Fortunately, and contrary to much of the rhetoric surrounding climate change, there is ample time to develop such technologies, which will require substantial capital investment by individuals.”

            This isn’t the place for a discussion of global warming, but the current questions involve the extent of warming, the impacts — positive and negative (which is dependent upon larger climate trends), the technology necessary to mitigate the release or effects, and the costs and ramifications of the efforts to address it. That seems to be the Cato position, though if you google their web site you can find a debate with competing views and opinions. Sounds like a healthy dialectic to me.

            Personally, I strongly endorse investing in more unpoliticized science and technology until the models can be improved. I would certainly not agree to address something before it is well understood, and I am convinced that this issue is neither well understood nor free from political jerrymandering of the worst type from every side.

          • David Whitlock

            What basis is there for the assertion that “there is ample time to develop such technologies”? Nothing other than the assertion by those (such as the Kochs) who profit from the status quo of no price on emitting CO2 into the atmosphere, and who also fund disinformation designed to trick non-experts into thinking that “there is ample time”.

          • Swami Cat

            And so the conversation goes to global warming…

            Enjoy the warming!

          • There is a great deal of data that CO2 come before warming, and that most of the warming is due to the sun, since Mars and Earths seems to warm and cool more or less together …. However the conservation of non renewable resources is always a good policy, and the use of resources that can not be use later is also a good policy. So the use of solar energy is a good policy. At the same time we should make use of all available labor, since we can not store Labor, so a good economic policy would be to repeal all taxes on employees and employers (becasue we want full employment, and to tax non-renewable energy since we want to conserve it. Global Warming is just a diversion from what is good policy.

          • CORRECTION: Warming comes before the CO2 ….. Like with Coke, if the Coke is keep cool the CO2 remains in the Coke, warm the Coke up, and the CO2 comes to the surface. In our case the warming is due to the Sun, and the CO2 comes from our waters.

          • David Whitlock

            Warming comes before CO2 only in the ice core records. That is not what is happening now. CO2 has gone from ~280 ppm to over 400 ppm in a little over 100 years.

            CO2 in the atmosphere comes from burning fossil fuels. This is extremely well known. The amounts of CO2 track the amounts of fossil fuels extracted and burned, the isotopic composition of CO2 in the atmosphere tracks the isotopic composition of the fossil fuels.

            We have records of how much energy the Sun has been emitting the last hundred years or so, because we measured it. The warming observed doesn’t come from the Sun (which has stayed relatively constant), it has come from decreased infrared emission from the Earth due to CO2 (and other GHG ) in the atmosphere.

            Thermal radiation goes as T^4. The only way the Earth loses heat is by radiation into space. If the radiation is blocked (as by CO2), then the temperature needs to go up for the same amount of heat (from the Sun plus geothermal) to be radiated. The temperature will go up until the Earth surface is in equilibrium with the amount of heat being received equal to the amount radiated.

          • As you pointed out, CO2 came after the warming …. Now there has been no real warming for the past 20 years, back in the 1970s they said that the CO2 was going to cause global cooling …. That did not pan out. However if as you point out the CO2 blocks the radiation from leaving the earth, it can also block the radiation from the sun from heating the earth. Base on the scientist I have read, the truth is they do not know enough about the various factors at play. …… Hense, I relie on economic factors that are more reliable. We know we need tax revenue, we know that we need more demand for labor/employment, so we also know that it is foolish to tax employees and employers. We know the FAIR TRADE benifits both parties, Hense our tax system should be created so that both domestic and foreign goods are taxed the same ….. Which leads us to the FAIR TAX on goods (the FAIR TAX is the name giving to a type of tax), and if we want to conserve energy so that we can use it another day, we can also tax non-renewable energy. These policies do not relie on uncertain data as with global warming/cooling, but on know economic policies. So I am “pro-non-renewable-energy conservation” I am just opposed to trying to scare people into into it. By the way, “Global Warming” has been replace by “Climate Change” which no one can disagree with since that has been happening since the beginning of time.

          • David Whitlock

            You are woefully ignorant of the actual science and are simply spouting denialist talking points (aka lies). There has been warming in the last 20 years. CO2 blocks infrared radiation, the energy from the sun is in the visible. There was never consensus about cooling in the 1970’s in the scientific community. There is consensus now about warming due to CO2 and other GHG.

            Climate change denialist talking points are all debunked here.


          • As you know there in no consensus today, nor is there the science today….if there was consensus you would not have this as a political issue. The consensus is that the Sun is a source of light and heat……

          • David Whitlock

            You are living in a bubble of ignorance and disinformation.

            There is a broad and robust consensus among scientists. As scientific expertise in climate increases, so does the consensus that climate is warming and that the warming is due to CO2 put into the atmosphere by humans, mostly through combustion of fossil fuels.

            For example NASA:




          • Al Gore profits from the CO2 panic.

          • John Michael Crofford

            That argument is weak.

            How much money do you think Al Gore makes off of people believing in climate change? If he weren’t getting paid to talk about climate change, he would be getting paid to talk about something else because of his distinguished history of government service.

            How much money do you think Exxon and the Saudis would lose if world demand for oil were to collapse because we actually took climate change seriously? I’m pretty sure that Exxon would go under (creating a loss of ~$300B for shareholders after the physical assets were sold off) and most, if not all, of the House of Saud would be killed in a civil war.

            Tell me again how the motivated money people are on the side of climate change being real.

          • Why is the ‘NEW” term “global change” ? And not Global Warming? Currently we are still recoving from last mini ice age …. We have not reach the long term average and have not had global warming for twenty years. I have read the top scientist claiming that we do not currently have a good model for forecasting real warming or cooling. What I have read is that those who support Global Warming had to adjust their data, and choose between reading in areas where there has been a lot of change and readings in areas that have not experienced a lot of change. Adjusting the data where there has not been a lot of change to agree with data from cities where there has been lot of change.
            More CO2 benifits many, so why would one expect people to want to stop the CO2?

          • Cameron Murtagh

            I’ll assume you understand the importance of Bloomberg within Wall Street – how about we see what the make of the NASA data.


          • Cameron Murtagh

            Given you’re talking economics -how about we have a look at what Bloomberg makes of the NASA data?


        • David, the Free Market / Free Enterprise have a role for a limited state to provide services that the Free Market does not address, but when talking about unpriced externalities …. Free Market / Free Enterprise system as per Adam Smith (1776) seems to deal with them better that socialist / Fasist systens on the LEFT deals with them.

    • You might want look at Switzerland’s federal government……

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  • An irony: economics may be ready (or not) to become a real science…just before it’s rendered obsolete by accelerating tech. Every single economic system in history and pre-history was based on the management of scarcities. What happens as replication tech ends one scarcity after another after another until everyone can order their replicators to make whatever they want? Economics will vanish on that day.

    • There are always scarcities, only so many people can have a home along a lake, only so many people can have the best seats at the theater. Only one people can own a one of a kind painting. There are only so many people that can go to a given event. Scarcities will be always with us …. What will be the scarcities of any given time will change, but not the fact that there will be scarcities.

  • Individualism: People simply cannot make their decisions independently of others, especially in economic systems, systems based on exchange with others. What true individualism requires is that each person has the power and is not unduly restrained by others in making decisions. Each individual must judge how best to respond to the needs and desires of others effectively in order to maximize their own economic effectiveness. A system in which only a few aristocrats, plutocrats, workers councils, etc., get to make all the decisions is not one that respects the ordinary individual citizen. Nor is it one that can take advantage of the enormous amounts of useful information out there. Hence, individualism is at once highly idealistic and practical.

    Maximization: Individuals may be endeavoring to maximize their own welfare every time they make decisions, but they may fail. There is a learning process. There are things overlooked, things unknown, surprises happen, breakthroughs happen. Design is not a word I’d use to describe maximization.

    Equilibrium: Neoclassical economists believed when markets cleared, equilibrium would be achieved automatically. They failed to take into account the above learning process and the impact of accelerating technology on production and what is being produced. The slightest cursory examination of American history will show the student that the American economic system NEVER achieved equilibrium. It was a genuinely free system that permitted the exploration and production of novelty. Faster and faster.

    These three concepts actually do fit together nicely once they are thought through properly.

  • Timothy Tan

    Economics is not a real science. Science depends on laws, which determine behaviour. In economics, however, we are dealing with human behaviour. Darwinism is well and fine, but it clearly states that the environment is the key determining factor to evolution. When applying to economics, it is the environment that is constantly being ignored by dogmatic economic theorem.
    Rather than follow dogma, more should be done to understand the environment in which the economy operates. And only by using the most basic of economic principles (which apply to all schools of economic thought) in the face of the environment can economics provide sound policies for government to apply.

  • As a libertarian, I don’t know what you mean by “the ideal economy”.

    I can’t believe you brought up Afghanistan and Somalia. Really?
    These countries have suffered for decades under the occupation of government military action and you have the nerve to refer the results to libertarianism!?

    You are definitely cheating in the debate over a political system vs a market system.
    Let’s talk about the problems of a politically managed regulatory system.
    Corruption! Lobbying! Wealthy “defense” industries. War making, killing innocents in other countries as “collateral damage”.

    I know you conceive some “ideal system” where government makes everything work perfectly, but such has never existed and never will. Are you even aware of the problem of the incidence of sociopathy in the human population and the kind of people attracted to power?

  • Russell Spears

    Everything in Economics assumes labor does not have ownership and the data they use is junk. The rise of blockchain technology to record every transaction and store of value and with Workers moving into Democratically Run Worker Cooperatives, exploitation will be removed from all economic models and you will have a truly different model to develop…..

  • ultimativity

    Not convinced that Darwin’s model was strictly competitive. Reading The Natural History of Human Thinking and the human departure from the Great Apes is based on collaboration. (the Apes continue to operate from an individual competitive perspective. It is ironic that the Austrian school, like other theories of economics, makes the same mistake. Even though Hayed, etc. began to understand self-organization, they retained the “agent” or individual actor focus, just as much of economics seems to do today.Self-organization concerns different laws emerging at ascending levels of complexity.It’s why Newton’s laws were necessary but not sufficient

    • It’s not. This would certainly imply that within economics we wouldn’t get steady competition ensuring the lowest price, but cooperation between actors and monopoly. That the lowest price is not the best strategy but the highest price people will pay. — There are clear predictions made by evonomics and they are not strictly the same. That the blind watchmaker is the invisible hand of the market, is important, but missing the implications would be in error. Rather than perfect through basically magic, they are evolved. Evolved systems have a lot of cooperation, monopoly, and parasites. In fact, parasites are one of the most common things to evolve. This would actually lead to specific needs for government regulations specifically to basically domesticate the markets.

  • commiiiiie

    What Libertarian school? I’m a libertarian, so if such a school exists then you would think I would know about it, but to my knowledge there’s no such thing. I know of the Austrian school, but they don’t regard economic agents as utility maximizers.

    Also, speaking of those pesky data:

  • Simon Gramstrup

    An interesting article. I have just a few points I would like to raise here:

    1. This piece still has to much emphasis on our evolutionary ability to compete – that is, how heritage has directed us towards being ‘good’ competitors’. As far as I know, any tribal or even larger group has always used gift-economy or other such sharing-economy.

    What this suggest is that scarcity and in particular ‘artificial scarcity’ is a newer emergent phenomenon, that probably emerged first as a result of tribal scalability issues, and secondly because there’s no market-mechanism that tend to remove scarcity of a product.

    That, in turn, means that we as a species have only had <~8000 years to 'evolve' a competitive edge, as it is understood in the article. I think there's several reasons why this is not enough time to evolve a permanent ability, but that's for another time.

    Bottom line is that we don't need to compete because we are 'built that way', we compete when we are either forced to by scarcity, or for social recreation. On the surface, this is counter to the rebuttal in the article, but wether the competitive behaviour stems from evolution or is forced upon us by the systems we surround ourselves with, doesn't really matter as there's still a basic confusion about the difference between competition and maximization.

    2. What we consider a basic principle of the libertarian free market ideology, is probably up for debate, but I believe the idea of humans as a 'homo economicus' is also a core principle, and that idea also assumes that we all have perfect knowledge about everything related to every transaction. That's the only way to reach that ideological 'perfect' transaction where both parties receives maximum benefit. Of course, any other of the infinite possible outcomes, will leave a win for one, and a loss for the other..

    3. I have to doubt that economics are ready to be a science. the basic assumptions about both the dynamics of our environment and human nature, are unscientific, the whole structure of the field are unsound, from the early ideology of students, to what is taught in schools, the 8-12 different 'economic schools' (belief-systems) and a serious disconnect from the real sciences (there's comparably, less cross-references to real science). There's also an almost complete lack of interest in non-fitting empirical data, where the norm are to shove the data into a specific model, rather than adjust the model, the popular models don't account for how energy, science (knowledge) and a few other things, and finally the imho worst issue, is the inability to recognise the dire behavioural consequences of these theories and systems that they pull down over peoples lives.

    As of now – in general, economist are a mere mix of preachers and ideological 'technicians' – not scientists, and I for one doubt a sudden awakening..

    • It tends to be as much science as most other field, even chemistry acts differently near absolute zero C degrees in ways that are not predictive at normal temperatures. And it is much more rational than many of the other “social” sciences. It tends to be half way between the “hard” sciences and the “solf” sciences …. Which is what makes it so hard for so many people. Economics is also some thing you can apply on a very personal scale, and something that can be applied on a mass scale. If you know the values of a person or those of a people you can forecast what they will do. Hense, in the military, if I understand that my soldiers are individuals, with their own wants and desires, and that they are unlikely to obey my orders just because I want them to; and I understand that I cannot pay them more for more work, I need to come up with a better means of motivating them. So if I set a reasonable goal for them, and tell them whenever the goal has been reached they can have rest of the week off. Well, they became 400% more productive. Most likely while in the US Army I saved the tax payers $3,400,000 in current dallors. That is a lot more than my Penn State Univ. degree in Economics, and my 1LT pay for three years cost. A great return on investment for both me and the US government.

  • jayrayspicer

    Individualism, maximization, and equilibrium are clearly all axiomatically false, regardless of theory, because they are all empirically nonsense. Economic decisions are always affected by a multitude of other human choices, people almost never maximize their economic self-interest even when they try really hard (and they don’t often try really hard), and everything in the economy is a moving target.

    I’m heartened to see the idea of maximization especially held up as nonsense. But I think it is replaced by competition only sometimes. Most times, maximization is replaced by satisficing. I not only don’t need to be the fastest runner ever, or even the fastest runner in the current group, but I usually don’t need to run faster than any competitors whatsoever if I can walk slowly and still get what I want. Why waste the energy? Male lions hardly do any work at all. They don’t have to. They work as much as they need to in order to preserve their position in the pride. Hunter/gatherers don’t work themselves to the bone. They hunt and gather as much as they need to, at a relatively leisurely pace. It’s not like they can store any surplus, after all. Hobbes was just wrong about the “natural” state of humans. He thought living in the wilderness would be a constant existential nightmare, but it ain’t necessarily so.

    Economics is clearly almost completely nonfunctional as a useful “science”, let alone an academic discipline. Apart from a few banalities like the law of supply and demand (which is still too complicated for supply-siders to grasp), the field of economics has almost nothing to offer in terms of guiding public policy or even warning when the economy is about to go off the rails. How can anybody take economics seriously when it can’t even tell when we are in the middle of a bubble, even if that bubble is painfully obvious after the fact? And the reason it utterly fails as a science is that it is thoroughly unmoored from empirically supportable axioms.

    In short, economics fails because people just don’t work that way, and it’s hard to believe that anybody (who wasn’t a sociopath) could have ever convinced themselves that people do work that way. Only Ayn Rand acolytes like Alan Greenspan can be so confused as to think neoclassical economics is useful. It’s certainly incapable of meaningful prediction, which is one of the hallmarks of an actual science.

    I don’t know if scrapping the current axioms of economics and rebuilding it on an empirically supportable foundation will lead to immediate benefits, but it’s not possible for it to be productive until it is married to the behavior of actual humans. It’s a branch of sociology/psychology with whatever evolutionary underpinnings that requires. Until we recognize that, economics might as well not exist. It doesn’t do us any good, and it appears to be doing a great deal of harm.

    • You seem not to know the difference between economic and financial decisions. People may not maximize their financial decisions, but they almost always maximize the economic decisions. Since economic decisions are based on exchanging something you value less at the moment, for something you value more. ….. It may be that some time later you may feel that you made the wronge choice, but that is with hindsight. Economic prove very useful to me in the Army and in the corporate world, Using economics I was able to increase the productivity of my US Army Transportation Company 400%, and when I became CFO of a corportation I was able increase productivity by 300%. Economic work well if you understand it and apply it. You seem to think that economic deals with only monetary issues, Economic deals with issues a simple as “Do you want to make a cake or not” If you think you can take the resources available to you and make a cake that would be valued more than the resources (make a profit), you make a cake, if you feel you can’t you don’t. IF while you are making it you get distracted and the cake burns that is a LOST. When I was studying Economics, I was told that most people can’t think far enought to really understand economics …. It is like CHESS, to be good you have to be able to think many moves ahead, and yes, economics can be applied to chess.

      • jayrayspicer

        All decisions are economic decisions, because all decisions have opportunity costs. No matter what you’re talking about, there’s almost certainly an alternative that would have led to greater economic benefit. It’s pretty much mathematically impossible to maximize the economic benefits of any decision, because all decisions must be tightly constrained to fit within a person’s time budget, despite infinite opportunity costs to consider.
        Whatever productivity increases you made in the Army or as CFO were only productivity increases in the things that you measured. And whatever decisions you made, you only achieved 400% and 300% increases. How do you know that either of those results was maximal? You really can’t. There could well be productivity decreases in things you didn’t measure, just as there could well have been alternatives you didn’t think to pursue that could have resulted in 500% increases in productivity.
        Economic maximization is impossible. One can only ever attempt to maximize the economic benefit from any decision, and that attempt will always fall short. Even if you say that “maximization” really means “maximization within practical limits”, there’s no way to actually know for sure that somebody else in your shoes couldn’t have made an even more optimal decision, whether accidentally or on purpose.
        Even if you are trying to maximize economic benefits, there is only so much time in the day. At some point, you have to pull the trigger.
        And people only very rarely even aim for maximization. They routinely aim for “good enough”, and that is not often beaten by those who aim for “maximization” or even the vague “excellence”. History is littered with the wreckage of better solutions not adopted.
        Decision maximization is a unicorn. And you can’t ride a unicorn to a productive theory. Until economics is firmly grounded in actual human behavior, it can only ever lead us astray.

        • Derryl Hermanutz

          Good points about the absurdity of “maximization”. Steven Keen presents a scenario of a grocery shopper whith $100 to spend, in a store that stocks 10,000 different items. It would take thousands of years to do the calculations to “maximize” your choice of items that add up to $100 of spendable money. So people ignore most of the possibilities, and buy what they want or what they are used to buying. They ‘maximize’ their ease of shopping, not the “economic value” of the basket of stuff they buy.

  • Economics is based on giving up something of lessor value for somethings of greater value to the person making the decision. As for “equilibrium” it is always in the long run. People make decision based on their “TRUE VALUES” ….. To say what Darwin would have done is not science. When economic decisions are made by others for a group, most often the decision that are made are not what the group wants but what a group within the group wants, like Kings making decisions for the “good” of thier subjects. By the way Libertarian/Classical (as per Adam Smith) has a role for government to play, in fact if you read more than just the first section of “Wealth of Nations” read the whole book you will find that Adam Smith wrote the book to guide government policy. Instead of the English government learning from the book, the concepts of Adam Smith were written into our Consitution which is what made us an economic powerhouse quickly.

  • Mike T

    Free markets are an outgrowth of the physical constructal law. This recent discovery has the potential to open new doors within the political and social sciences.

    • Yarwain

      You don’t mean boastful Bejan and the Bejaniacs, do you? Just relax, everything ‘flows’? 😉
      Of course, in his native tongue, a ‘drawing’ doesn’t need someone to have drawn it. It’s a ‘drawing’ without a ‘drawer.’ Thus, it’s easy to propose a covering ‘law’ from physics to psychology and politics. Voila! Stupid western agent-interested philosophers should just change their language and ideology…yesterday at the ‘invention’ of the ‘constructal law’ – the greatest discovery in the history of humanity that only ‘haters’ don’t like because they aren’t capable to understand it?
      Oh, and he’s the smartest person in the world; indeed, he is a Romanian god in the USA. 😛

  • Yarwain

    This article is full of unrealistic and uninformed fantasies.

    “The Libertarian paradigm is one in which the ideal economy will arise out of a social system as close to a natural one as possible.”

    ‘Libertarian’ is not a ‘paradigm’ in the sense of ‘scientific revolution’ proposed by Kuhn. And collapsing social into natural isn’t often the best idea. Civilisation seeks a ‘higher human nature’ rather than the bestial path that Darwin beat out through his own ill health.

    “we’ll have to systematically critique the shortfalls of all political ideologies to show where they are consistent with the science and where science and ideology diverge from each other.”

    Darwinism is also an ideology. You are failing to distinguish evolution from simple biological reductionism, which has no serious basis in social theory.

    Heterodox economics need not fall into such an appalling hole as the one Darwin dug to bury non-humans in. Why are you aiming to bury neo-classical economics by trying to regurgitate a 19th c. thinker in the 21st c.?

    • Ed Buskirk Jr.

      You used some big words, strung together in some nice ways, but what you actually said is unrealistic and uninformed fantasy, to use your own words. You understand neither what a paradigm is, nor what an ideology is (nor what heterodox or reductionism mean, for that matter). You should look all of those words up. Once you understand what those words really mean, you should reread this article without focusing on the specific words at all, but on the concepts they represent.

  • josluizsarmento

    «If we accept, as I suspect most educated people do, that humans are the product of a long succession of evolutionary pressures, then we must logically concede that we have inherited traits from our ancestors.»

    So far, so good. It’s what comes next that’s fundamentally erroneous:

    «Furthermore, we must accept that our ancestors had to compete with their peers for resources in order to survive and that we are the product of whichever humans happened to be the best competitors.»

    We need accept no such thing. We can assume our ancestors had to cooperate with their peers as easily as the author assumes competition; and the most plausible assumption is that the most successful individuals and societies were the ones that achieved the best compromise between competition and cooperation, making us the product of whichever humans happened to be the cleverest compromisers.

  • Aajaxx

    Seems to me to be a straw man argument against libertarians. I’ve never read anywhere in libertarian literature the three “axioms” mentioned here. I can only conclude he is putting words in libertarian mouths.

  • MaxBorders

    This is a fundamental misunderstanding of libertarian theory and it’s intellectually dishonest at best. If you’re going to write, you should be charitable to your opponents positions. You have to know the tradition you are attacking and know it well. At the very least try to pass an Ideological Turing Test before you hit “publish”: “The Ideological Turing Test is a concept invented by American economist Bryan Caplan to test whether a political or ideological partisan correctly understands the arguments of his or her intellectual adversaries: the partisan is invited to answer questions or write an essay posing as his opposite number. If neutral judges cannot tell the difference between the partisan’s answers and the answers of the opposite number, the candidate is judged to correctly understand the opposing side.”