So Fair Trade Might Be Immoral?

And yet, it might not though! I’m not sure which way it goes.

Say you have £10 to spend on chocolate.

You can buy 4 bars of Fairtrade chocolate
which will benefit an average of 4 farmers
to the tune of (£10 divided by 4) multiplied by the fraction of money that goes to farmers.

You can buy 6 bars of regular chocolate
which will benefit an average of 6 farmers
to the tune of (£10 divided by 6) multiplied by the fraction of money that goes to farmers.

Presumably ten farmers getting £1 each is ‘fairer’ than five farmers getting £2. How about ten farmers getting £1 versus one farmer getting £1000? Or ten farmers getting £100 or nine farmers getting £1000? What calculation do we use to cut the cake?

Ceteris paribus buying cheaper-per-weight chocolate pays more farmers, with smaller wages. So Fairtrade means we benefit fewer farmers. My question is, do the gains to each farmer outweigh the losses presented by there being fewer jobs available in third-world farming? Do the majority of farmers, who don’t get the luxury of affiliating with a fairtrade trader, suffer even smaller wages, by there being a surplus of unable-to-get-the-fairtrade-price farmers? A market-wide price-floor on waging for chocolate farmers, per any price restriction, shifts the demand curve. I’m wondering: is this desirable for the good of chocolate growers?

(Perhaps the effect of people being more willing to chocolate given an ethical option increases the demand for chocolate and offsets this?)

This is why I’m not an econ professor yet.

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Not Another Parallel Between Religion and Socialism!

(Part 1.)

A religious person cannot possibly live without a great deal of empirical knowledge. Similarly, socialism cannot exist without being funded by a great deal of capital, generated by a capitalist system. A side effect of having clever scientific brains is that we can afford rationally destructive beliefs like religion. A side effect of having a rich economy is we can afford capitally destructive policies like socialism. Science divorced from faith lies the path to true knowledge; why is capitalism divorced from socialism not the path to a true society?

 

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Review: Carmen 3D

So this is old news for me but I wanted to write something about it.

The other day, I saw Carmen at the cinema in 3D, a recording of a production by the Royal Opera House in London. Carmen’s a famous Opera by Bizet. If you don’t recognise the title or the composer you’ll still recognise some of the music. The Toreador’s theme is pretty well-known, as is ‘L’amour Est un Oiseau Rebelle’, the Habanera. At one point the female chorus seemed to be about to break into Beyonce’s Single Ladies but thankfully (?) that didn’t happen and it was instead just the introduction to the Chanson Boheme. The choreography was very good, augmented well by the cinematography of the filming, and the staging and set design were both beautiful and framed the opera skilfully.

As it was the first opera I’d seen, and I was unfamiliar with the plot, at first it was disorientating watching it as I didn’t know where to direct my attention or understand the broader musical picture of the plot. Watching it a second time was thus much more enjoyable. I recommend opera!

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Some political philosophy (with added links)

This is going to be pretty condensed but I wanted to finally record some of my political/political-phil beliefs.

I’m a consequentialist utilitarian. Any other place to start seems arbitrary. So there is no moral purpose outside of the wants of conscious persons. To maximise this we should therefore hope to construct a societal system that lets the most possible people do and have things that they want (both materially and in every other sense). A priori, if a centralised system turns out to maximise this, we should desire it. Or if a decentralised or any other system maximises this, we should desire that.

People say that public management of a variety of things is good because what is individually good for us is often not good for society as a whole. Democracy is no way to achieve this as given the nature of the amount of people’s votes necessary to institute government control of something, under a capitalist system, due to private ownership of goods and various market mechanisms, such a majority can not only exercise just as much power over the shape of the world, but will often not even need to explicitly state their desires for their effects to take place.  “The result of human action, not of human design.”

For example, black people only won equal rights in America once the majority had been convinced that this was a good thing. Had there not been explicit laws against desegregation before this, we may have seen black people treated with respect much sooner. The fact is, discrimination on irrational grounds is a type of selflessness, and stupidity at best, because any genuine self-interested employer will choose to employ a skilled black man before a less skilled white man, regardless of race. If the majority of people won’t patronise an equal employer of black people, we can’t expect a democratically elected government to do any better. Progress will only be made through capitalism, in this case.

Contrary to poplar conception I think government emphasises near-sighted thinking more than capitalism does, as people vote more carelessly than they invest, they choose what is good for others less carefully than for themselves. Capitalist systems are much more complex and retain the intricate weights of each person’s beliefs and in much more precise terms. When everyone uses currency, everyone’s values and desires are on the same table and have a sort of sacred equality. When government spends money, it is not with a single brain whose future is tied to the effectiveness of that spending. It is with many borrowed brains, many of whom are disinterested in the outcome of the spending, many of whom don’t have any understanding of what their decisions will do.

On a more abstract/philosophical note, selfishness is the source of all good. Superficially, because all actions are necessarily selfish actions (crucially, people do what they want, because if they didn’t want it then they wouldn’t do it). More meaningfully, as almost all ways to further one’s interests also coincide with helping others at the same time; and moreso under capitalism than government. You’d have to be really really clever to be really successfully selfish at the same time as screwing other people over. Whereas under a government system, groups generally seek to prosper at the detriment of other groups. When one group gets a subsidy it is at the direct expense of the taxed. In a genuine free market economy however, one person’s gain in productivity translates to the ability to gain customers by charging a lower price. When the only permitted human interactions are voluntary ones, all benefits must come in pairs. In an economy wealth is generated by production and virtue, not by redistribution and need. Production and virtue are maximised by a self-fuelling loop. In a system that supports redistribution and need, productive people will begin to envy the needy. If you want more poor people then subsidise the poor. If you want to instill the way of thinking that can end absolute poverty, show them a world where their virtue, and ability, and desire to work will be rewarded. (And don’t introduce a law that makes the poor unemployable while you’re at it.)

Common replies to ‘capitalism makes everyone richer’ is that this doesn’t include the poor. This is empirically not true. In the cases where poor people have an awful time, it’s normally due to government intervention. E.g. the minimum wage’s effects on employment, non-free immigration’s effects on other people’s standards of living. Just to state explicitly an implicit premise here, it seems obvious that a society of rich and poor people is better than a society of poor people. Even though under capitalism you may get a minority of lucky investors (or inventors, or artists etc) who have huge amounts of wealth compared to the poorest in society, this is proportional to the good they have allowed for others via the economy. What is not seen is all the investors who made tricky investments and didn’t get that payed off. The huge potential pay-offs of being a great investor are necessary to ensure that investors invest against the risks involved. Not to mention, people who are rich are a great source of charity.

I submit that personal and economic freedom almost always good utility-maximisers (see microeconomics). When they aren’t, it is highly context-dependant what system would even produce a better result (and when a system works in one situation, the same system applied universally would often have a net negative effect anyway). Market failures can quite easily be corrected by voluntary contracts. Government failures are seldom simple or obvious, and are less prone to swift or permanent correction. The negative effects of government policy are frequently attributed to market freedom (e.g. risky investments leading to market crashes being blamed on too much freedom in finance, rather than the bailouts and policy which propagate such behaviour by divorcing power from responsibility).

In terms of the future, I support a swift move to limited government (public operation of contract-enforcement, protection of individual liberties with courts and police forces, and that’s it). From there, movement to voluntary government/courts/police forces seem in theory a good idea but might actually decrease liberty, so decentralisation to a number of competing provincial systems seems a good bet. (The intrusions on liberty would be pretty minimal at this point and the advantages of fuller liberty similarly small, thus my proportionally reduced concern.)

Don’t be convinced by the handful of examples. The empirical evidence here is incredibly selective, for reasons of making the article succinct. But I instead hope you can see how the principles apply to the evidence you’ve already amassed by yourself, and how ideas that don’t necessarily click on first hearing may be linked in a broader way to the mechanics of society.

Follow the links, there are thoroughly consumed, heartily endorsed economics resources (/songs) throughout the page.

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Review: Flowers for Algernon

This American science fiction by Daniel Keyes, published as a short story in the 50s and released as a novel in the 60s (that which I read), depicts the life of mentally retarded Charlie Gordon, subject of a revolutionary surgery to increase intelligence, via a series of ‘progress reports’. Algernon is the mouse on which the surgical technique was tested. Charlie turns slowly during the weeks after the surgery, from being mentally a child, to a genius. We see the memories of his troubled childhood brought back and elucidated under Charlie’s new awareness of the world, coming with it sexual and romantic desires, and internal conflicts with the frightened vestige of his unaware self. His basic cognitive functions improve remarkably leading him, among many other conquests, to eventually take a more vital part in the study of his surgery than his doctors. Later on, the hope that Charlie’s surgery would be permanent is threatened.

It’s a really lovely book. (I’ve been noting that my reviews are all positive: I suspect this is because I intentionally pick books to read that I’m fairly sure I will enjoy, ones for which I’ve heard praise from sources close to my intellectual heart.) The characterisation is well-done, and it’s nice how our knowledge of Charlie as a person unfolds throughout, in line with his own growing self-awareness. The themes, how ‘normal’ people interact with abnormal people, are explored tactfully and, one presumes, insightfully. The relatively rapid transition of Charlie’s also includes interesting ideas about the nature of intelligence and thought. Also interesting is the internal dialogue of a mentally deficient brain trying to figure out the universe with limited resources.

I’m not sure what my next book will be.

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We Need More Government!

Look at the world around us. It isn’t in its current state for a lack of government and control: it’s so clearly out of control. We need as much government and regulation as we can get. Because of this, I would recommend gradually instating in the region of 7 billion new sovereign states to deal with the deficit in responsibility and control we have found ourselves in. With all that centralisation I don’t see how the economy could take another wrong turn.

My point: increasing government control of things decreases total control of things. Decentralisation of power to the atom of the individual human increases the total control that humanity has over nature.

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Review: The Presentation of Self In Everyday Life

So I finished that book by Erving Goffman!

It was cool. It was about signalling (i.e. the actions we perform to make people think we are who we say we are) and the world around that sociological phenomenon. About how we regulate how we act, in order to portray a consistent image or character, be it in a job role in front of clients, or as an individual toward friends and family. Useful for the prolific anecdotal examples of the phenomenon of human relationships, analysed according to the idea of people’s identity being rigorously moderated performances. Not sure what else to say other than if you want to manifest a pair of internal glasses that help you perceive and understand social reality in a different light, read it.

I’m currently in the middle of Flowers for Algernon which will be the subject of my next review.

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