One of the more problematic concepts of human consciousness is the idea of ‘representation’: While the evolution of perception enables us to make distinctions of the structural changes we undergo in interacting with our environment, language allows us to categorize these distinctions as external ‘things’. We call them objects and henceforth treat them if they had an existence of their own, independent of our perception through the senses and conceptions of the mind which constructed them in the first place. In this way we often create traps for ourselves.
For example, we tend to believe that what we see or photograph is a truthful representation of an object existing as an ‘original’ in the ‘real’ world. A long line of philosophers and biologists have tried to demonstrate that what we call reality cannot be more than the sphere of constructions of our minds in language, because we have no access to the world independently of our senses and not integrated in the linguistic schemas of our mind.
The concept of representation is so deeply entrenched in Western thinking that we do not usually question it. But representation requires a direct reference to the original which is represented. The perceived ‘original’, however, is already a concept of the mind. The map is the territory. We have, however, no direct, independent or verifiable access to the territory. All we have is maps and the assuring notion that beyond this map-reality there must be something like a universe. 'Observing' cannot describe any direct access to this universe independent of the senses of the observer, but relates to the changes experienced by the observer within himself while interacting with his environment. This seemingly radical empiricist approach is dampened, however, by evolution itself which has encoded many experiences into ‘hard wired’ expectations ensuring that new experiences are interpreted according to these expectations -or otherwise ignored. The notion that what happened before will happen again, or that distinct effects have distinct causes, or that the horizon is horizontal are such hard wired 'pre-judgements'. Thus we have an evolutionary ‘rationalist basis’ encoded as a priori of our experience. Although language can free us from most if not all of these ‘presets’, we always need to seek some balance between what we rationally expect and what empirically fits. In the domain of language, logic helps us find this balance, in the domain of action, our senses reinforced by an occasional bruise are supportive. So the rational approach needs empiricism, the empiricist approach requires rationality. They are not mutually exclusive but interdependent.
Intelligence has to do with how well human beings are able to navigate their linguistic reality in such a way that it helps them to operate (survive) successfully in their environment. I prefer this definition over many others, because it brings language into play and points to the fact that every human being capable of language also has intelligence. Intelligence in this definition is completely personal and individual, although it can only evolve in interaction with others and the environment. It is what today is called an "emergent phenomenon", not a tangible object, nothing you can find by dissecting the brain, staring at brain waves or MRT images. It is like a rainbow that emerges from certain physical conditions, but only as a phenomenon to be observed.
Because we also cannot have direct access and thus reference to the ‘original’ intelligence of an individual, intelligence cannot be represented – neither by a computer nor by another human being. This simple fact has tremendous consequences: It means that a group can never claim more intelligence than each of its members. A political leader, a government or a central committee cannot represent the intelligence of the many they govern, but only their very own. Intelligence is always individual and can only be expressed by individual action.
The intelligences of the several individuals cannot be aggregated into a single operational collective intelligence which then could be exercised by a leader, a group or a government. Collective intelligence again is an emergent phenomenon that only emerges from the actions of many cooperating individuals.
Collective intelligence cannot even be articulated, just like a rainbow cannot be touched. Whatever is articulated flows from the intelligence of the one that articulates it. He might have made use of many other articulations from other intelligences to get there, but the result, as authors usually insist in their acknowledgements, is "the writer’s own responsibility". Political concepts of a 'general will' that can be represented by a government or parliament are highly dubious for the very same reason.
When many individuals each exercise their own intellectual and physical potential, chances are that there will be more collective intelligence emerging as a result than if all just follow the orders of one and thus only act in accordance to just one single intelligence. This is the secret of markets in the broadest sense: free competitive markets of ideas, of values, of individual plans, of local individual knowledges, firsthand experiences and opinions. Of course markets hardly ever are completely free. But they are the only way to bring forth a maximum of intelligence. Every attempt (and there are many) to restrict, regulate or even 'stimulate' markets will make the outcome less intelligent.
The trouble with many intellectuals and most politicians is that they see themselves as more intelligent than markets. After all, a market is not even tangible, has no college education and does not read books. It cannot even make plans. Intellectuals and politician can, and they thrive on plans. They think that if people follow just one good and big central plan the overall outcome will be more intelligent and far superior than if everyone follows his own little imperfect plan and the outcome is just an emergent phenomenon. This is the core mistake of political thought.
The logic of political intervention is based on some tirelessly repeated myths about areas where markets and voluntary cooperation supposedly “just don’t work” and have to be helped along by coercion. Here are some of the most common ones and the arguments used to defend them:
The true values of goods
'Since market values are expressed by money, the “true value” of goods is ignored and the commons subsequently spoiled. Therefore, so the logic goes, government has to interfere and set prices representing true values.'
A value is an expression of a relation between a preference one has for a good over other goods in a certain situation. Values expressing human preferences cannot be quantified for three reasons: they are intrinsically personal, they are dynamic and they are ordinal, they can mathematically expressed only by ordinal numbers dynamically changing with circumstance: My first preference in situation A might be X, but in situation B might become Y. Complex systems with dynamic ordinals principally cannot be mathematically modelled and thus quantified. (This is why human behavior, the stock market and even the climate cannot be quantitatively modelled).
In economics, the closest we can get to expressing values are prices. Since all goods requiring human labor prior to consumption or which have another owner necessarily are scarce goods for consumers, the willingenss to pay and accept a price in a voluntary exchange contract is the only way to determine value. Again, markets allow finding emergent values (prices) of goods in letting producers and consumers freely arrive at prices where both seller and buyer see an advantage for themselves. This process is driven from the end, the 'marginal utility' of the final consumer and the result is as true to any “real value” as you can possibly get. In a free, competitive market, increased or decreased scarcity, changes in demand or preferences immediately find expressions in prices and give decisive signals to production. And because all parameters are continually changing, prices fluctuate, preferences and values change. The idea of a “true value” is self-contradictory: value is not a characteristic of a good, but a characteristic of the individual consumer desiring it. And since every individual is very different, has different plans, preferences, ideas and tastes, goods are valued differently by different people at different times. The idea of a "true value" suggests that value exists independent of the human evaluator. This is paradoxical, because even looking for a "true value" is a human evaluation process arbitrarily setting a value.
The famous ‘tragedy of the commons’ is a result of the fact that they have no producer or owner who attaches his own values to them as a basis for transactions. This is why privatization of the commons is the best way to preserve them, although this idea sounds very alien to those who believe in governments and their representation of collective intelligence. In the “public domain” nobody is or even feels responsible, everyone tries to grab a piece and nobody needs to care about what happens after…
Monopolies
'Free markets necessarily lead to monopolies because they are Darwinian institutions where the strongest dominate at the end.'
Even if we accept for argument’s sake the metaphor of biological evolution (which is problematic when taken literally, because humans are intentional ‘teleological’ actors pursuing individual plans, goals and long term ends), and even if we further accept the common misinterpretation that evolution means the survival of the strongest (Darwin was talking about the survival of the fittest – with survival itself being the ultimate proof of fitness), evolution has not lead to monopolies but rather to diversity. The `law of the jungle` - or in politically more correct terms the `law of the rain forest` is the law of diversity and interdependence, not of dominance and monopoly. In free markets, monopolies rarely form and even then they turn out mostly beneficial at the end. They form when someone has sole control or ownership of a resource, a production method, a technology, or a market. Such a unique position can, for a while, lead to higher prices and lower quality due to lack of competition or alternatives. But in a free market monopolies cannot be upheld by force and coercion. Therefore their abuse provides a growing incentive and opportunity for innovation, new technologies and alternatives. An abused monopoly is usually quickly ended by new market forces. Only government monopolies can be lasting, because they are protected and defended by physical force and coercion. Behind every monopoly today one will find a government rule, regulation, law, protection clause, custom, quota etc. Government itself is a monopoly and all its abuses can be traced directly to this very fact.
Standards
'How can a society function without standards? We need government to set them.'
Every market sooner or later evolves standards. Language itself is such a standard (of communication). Money is a standard of exchange media. Measures, weights and even laws and rules are standards. Standards have always spontaneously evolved in free markets, long before governments tried to monopolize this process also. Modern industrial standards were originally developed by industry, just as most of them are today. In this way, they are much more stable and efficient than when governments set them. Behind the Ten Commandments is not the desire of someone to ask a higher authority for guidance and new standards of behavior, but the fact that such standards existed already but people wanted to preserve them by codifying them into written rules with some supreme authority. Moral standards, like respect for other people’s lives and property evolved as basic social standards long before anyone thought of government -and governments since have done more to destroy them than to uphold or encourage them. In fact, not only have governments made a mockery of monetary and moral standards, they also keep destroying legal standards, which in all times have set standards of justice in human relations as ‘common laws’ or ‘natural laws’. Since governments and parliaments have assumed the role of ‘law-makers’, the ‘rule of law’ standard has been replaced by arbitrary ‘laws of rule’, disconnecting legitimacy from legality and effectively destroying law. The bad reputation of lawyers today is just one result of this ongoing process of the destruction of standards…
Money
'This necessary evil should be controlled and regulated by government.'
Both the platonic intellectual and the power seeking political mind believe that any emerging result of an economy guided by the 'invisible hand' of collective intelligence processes can and should be replaced by an economy guided by central plans, designed and executed by an omnipotent government. Money, which has evolved as a medium of exchange over a long period of time, in the hands of government becomes an instrument of regulation and control that can be created immediately out of thin air by just activating the printing press. But people very early on found that tying money not only to the goods it represented as a medium, but also to a scarce good itself (kauri shells, cattle, camels and eventually rare metals) is the basis for a stable market economy. For centuries, the gold standard kept money stable and reliable by automatically restricting the money supply and making sure that investments and credit were based on prior savings. Once governments incrementally got rid of the gold standard (the final blow was dealt by Richard Nixon in 1973) and replaced it with political goals set by governments and central banks, the printing and supply of money became a political issue and a means of arbitrarily intervening in financial markets. The results are the same as in every other similar intervention in history: loss of value of the currency, loss of savings of the public followed by reduction of savings, gigantic speculation and distortion of markets, production and consumption. Instead of reducing insecurity of markets (as was promised and expected), another factor of insecurity was added. The results are all too visible today: With cheap short term credit the US Fed first flooded the credit markets, inflated real estate and encouraged a huge bubble that consequently was ended again by the Fed through raising interest rates. And while banks and speculators are rescued by the Fed through more cheap money, hundreds of thousands of house buyers will lose their properties and savings. As the US$ exchange rate documents, these policies have just in the last five years destroyed 20% of the wealth of Americans. Here we see true government standards at work…
Freedom is Utopian
'Human beings need to be stopped by coercion from killing, robbing and exploiting each other.' Proposing that individual freedom and its expression in free markets provides the most intelligent way to solve problems is not utiopian. It is in fact the very opposite, because utopias are based on positive plans of action. Utopias usually either require or propose a new, more ‘perfect’ human being. The demand for freedom and free markets, however, does not require any interference or intervention, but rather non-interference and non-intervention: it is based on ‘laissez faire’, a concept and wisdom as old as Lao Tze. He already understood that if individuals are allowed to follow their own plans, they will find better ways and means to cooperate peacefully and successfully. Free markets and laissez faire do not require a new type of human being, they do not need a grandiose central plan to save mankind, they do not encourage utopian thinking based on benevolent dictatorships. They follow the schools of thought and religious belief that consider man to be first and foremost a creative, cooperative and essentially peaceful being, not a wolf only out to kill and enslave his fellow wolf…
The doctrin of freedom and laissez faire also does not require everyone to follow it first before it can be employed. Free trade, for example, was implemented unilaterally by some nations (like Great Britain in the 19th century) even though their trading partners did not follow at first. Setting an example and demonstrating its benefits has always been the most convincing way to achieve progress. If we want peace we can start right away by being peaceful and not supporting war, coercion and forced intervention. If we want freedom, we have to practice it and respect the freedom of others. If we want changes in behavior, we have to start with ourselves. If you do not believe in beating your children, you just stop beating them. You would not wait until everybody stops childbeating. If you think smoking is unhealthy, you will stop smoking, but not continue until everyone gives up.
The dream of enlightenment has always been to end coercion and violence in human relations. If we want a better, more peaceful, just and caring world, we can never achieve it by coercion, violence or force. If we let our ends justify our means, we will end up with just the means, because great ends are like rainbows on the horizon: you can approach them, but you will never completely get there. Anyone promising to reach these ends by big collective plans based on coercive government laws and regulations is only taking us further away from the goal. Although this is probably one of the oldest truths of mankind, in every generation there are some who believe that their plan, their government and their coercion will be different…
