PP users who disagree with Harry Browne

[doodle]

I'm curious how many PP users here appreciate Harry Browne's unique investing strategy yet fundamentally disagree with his political philosophy?

I spent the weekend listening to many of his political shows that are linked on the crawlingroad.com site. On some of his positions such as his anti war stance I found myself in agreement. However, on the vast majority of his shows and topics I found him to be an ideologue (like many libertarians that I have listened to and read) that dogmatically argues that the solution to every human problem is that we simply need more freedom and less government. I'm sorry, but  only a delusional fool could truly believe that EVERY single issue in our modern high density, complex society is best handled without any government intervention.

In one of his shows Harry Browne challenged his listeners to find ONE...just ONE government program that was effective.
Maybe I'm delusional, but many government interventions into the free market arise specifically because the free market isn't properly addressing certain issues. While I acknowledge (with nuance) that the government does oftentimes overstep it boundaries, or impede in areas that might be better handled with minor tweaks instead of huge readjustments, to make the claim that NO government programs or institutions are effective (or at least an improvement over the situation that existed before) is asinine and an example of the type of absolutist thinking that should repel any free and rational thinking person.

While I acknowledge the wisdom of the PP as an investing strategy, it bothers me that its creator seems so incapable of moderate nuanced thought.

[MachineGhost]

While I acknowledge the wisdom of the PP as an investing strategy, it bothers me that its creator seems so incapable of moderate nuanced thought.

In fairness, HB was a product of the relatively new Libertarian movement at the time.  And back in the 70's, anti-government fervor was at an all time high due to the Great Society, Vietnam War, Nixon/Ford/Carter and double digit inflation.  It got really fashionable in the mainstream.

Usually, in any so-called "market failure", you will find that government intervention was the real root of the problem, like Jim Crow laws.  The Libertarian rank-and-file ideaology is that any and all government intervention causes unintended consequences resulting in further injustice, disincentives and malinvestment, by interfering with the voluntary exchange of goods/services and distorting the price feedback mechanism.  

That may be true in a large majority of causes, but true "market failures" or "moral injustices" is where ideaology/faith meets empirical moderation.  I do not think Libertarianism deals effectively at all with issues of society's losers, behavioral finance, behavioral economics or situations such as the "paradox of thrift" where individual behavior is beneficial but collectively is harmful.  There are also clear areas in terms of law where non-profit, public disincentives are necessary to achieve better justice that simply would not work on a for-profit, non-public basis.

Another way of looking at this is...  just because there are corrupt politicians, bureaucrats and policymakers does not mean that democracy doesn't work.  Vice versa for libertarianism.  But it is foolish to keep thinking the same thing over and over and expecting a different result.

Also, keep in mind that Libertarianism helped shift the economic political center to the right after the 70's:

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In my view, Ron Paul is not a true Libertarian, but a State's Rights Conservative, even though he is closer to Kucinich socially than to anyone else in the Republican party.

MG

[D]

While I acknowledge the wisdom of the PP as an investing strategy, it bothers me that its creator seems so incapable of moderate nuanced thought.

Well, I'd say PP is a proof that he was capable of moderate nuanced thought... PP itself disagrees with his political philosophy... Similar to Ron Paul who is very socially conservative despite pushing socially liberal political stance.

[stone]

Personally I think doggedly trying to follow any ideology will cause problems unless you call respect for each other an ideology. In the UK we were sold as slaves whenever we didn't have much of a government. Before the Roman invasion, we sold each other as slaves to the Romans. Then in the early medieval period we sold each other as slaves to the Islamic world.

West Africans were chosen by slave traders in the 1700s and 1800s because they didn't have much government.

[doodle]

MG,

I agree that Harry is a product of his time but these were shows recorded in 2004...plenty of time to moderate ones stance. I would think that by the age of 60 a truly wise person would learn how ridiculous it is to use words like "always" and "never". If Harry had simply toned things down a notch and maybe replaced these words with "most of the time" and "rarely" my respect for him (and the Libertarian party) would be a lot higher right now.

Harry should have recognized that one of the greatest dangers to freedom is inflexible extremist ideology. Those political shows sully his fine investment advice.

[brick-house]

A good clip from Life of Brian with John Cleese in the role of Harry Browne...

http://www.youtube.com/watch?v=ExWfh6sGyso

I believe in small limited government that is difficult to expand, but am thankful for the aqueduct....

[WildAboutHarry]

I'm sorry, but  only a delusional fool could truly believe that EVERY single issue in our modern high density, complex society is best handled without any government intervention.

There a few examples that show how minimal government has organized or could organize a complex, high-density society: Hong Kong.  Great Britain, the US, and others in the 19th century.  Luna (see Heinlein's The Moon is a Harsh Mistress). 

And I don't think Harry ever advocated no government intervention, just considerably less intervention than we have.  Can anyone imagine that California will be better off with more government intervention?

Someone once said that paying taxes made them feel patriotic, but that they would feel just as patriotic paying half the taxes.  I'm that way about government.  About half as much feels about right.

[dualstow]

I'm curious how many PP users here appreciate Harry Browne's unique investing strategy yet fundamentally disagree with his political philosophy?

i haven't had a chance to study harry browns libertarian philosophy yet but this is my take on libertarianism in general
i tend to view it as a type of very valuable thought experiment, similar to "rational anarchy" or "enlightened anarchy", we will probably never see a world with only rational or enlightened men, but its a informative exercise to try to imagine what kind of government such a world would have or need... and to try to move towards such a world

humans are greedy, corruptible, murderous creatures and we (rightfully) need to have a government to put the brakes on those impulses, so we elect humans who are also greedy, corruptible, murderous creatures to fill that need... the catch 22 in this should be obvious.. we must always be skeptical of government and its intervention in our lives. and we must also be skeptical of giving the free-market to much free reign.. somewhere in all this there is a sweet spot where the two balance out (albeit imperfectly) and government does what is needed, and the people limit government.. (the US constitution is a exemplary attempt to define and solidify that sweet spot) i would call my views libertarian because to me it seems the government has not been properly limited, and has joined forces with the worst of the free market (crony-capitalism)... i think a correction/restoration is long over due..

the solution IMHO is having a better educated, more moral, less corruptible people... without citizens capable of taking responsibility for themselves and resisting the temptations to screw each other over, and citizens who take responsibility for themselves and resist the temptations to screw everybody over when elected.... we are doomed..

fixing our education system, and having men like RP and HB promoting the ideas of liberty and limited government, in a time those ideas seem to have been lost to most, are two important first steps to finding/restoring that sweet spot...

While totally sold on the pp strategy, I have found some of Harry's political ideas tough to swallow. To be fair, I haven't immersed myself in the libertarian concept and until I read a book or two on the subject, I'll reserve judgement.

Still, I just can't wrap my mind around the idea that we could survive without a police force, an army, etc.

[stone]

WildAboutHarry, some current freedoms in the UK were not available in the 1800s. We can now walk about where ever we like over large sections of the UK (right to roam laws). In the 1800s people got beaten up trying to do that. Political demonstrations and strikes were put down very draconianly then. Most of the population did not have the vote then.

Much of the current UK government is just a millstone around everyone's necks but sometimes calls for small government actually amount to calls for government to focus on upholding the power of the wealthiest.

[MachineGhost]

Still, I just can't wrap my mind around the idea that we could survive without a police force, an army, etc.

That's anarchy not minarchism (libertarianism).  But it is possible to privatize those functions too and some day in the far flung future we'll get there, but honestly I believe it'll require a technocracy, because humans are weak and prone to corruption.

What really stops us from going all the way in privatizing everything is issues of accountability, justice and fairness.  So far those still require human reason to reconcile.

MG

[TripleB]

"Giving government more power and money to solve a problem is like releasing venomous snakes in your house to fix a rodent problem." -TripleB ((c) 2012)

A few examples:

Problem: CEO Compensation is too high! It's unfair. Let's pass a law that makes public companies disclose CEO compensation to embarrass them into lowering it.

Result: CEO Compensation goes up 20x within a year of the law because now that the information is public, there's greater competition between companies to retain CEOs.

Problem: Terrorists are attempting to subjugate our freedom here in the US because they hate freedom. Let's pass the Patriot Act and give more money and power to TSA.

Result: Less freedoms then if we let the terrorists blow us up. Now we waste millions of man-hours per year, as a nation, collectively taking our shoes off at airport. Millions of man hours of productivity lost. But we have less unemployment because we took unemployable people and gave them TSA jobs on the government tit.

Problem: Higher education is too expensive. Let's make sure everyone can get federally backed student loans and can afford to go.

Result: Higher education inflation rises to 10% per year due to the high availability of federally backed loans, universities are free to raise rates because the customers (students) have inelastic demand.

Problem: Poor and old people are "dying in the streets" ((c) Left-wing extremist Liberals) because health care costs are too expensive. Let's give them Medicare and Medicaid.

Result: Cost shifting of medical costs to private payors raising private insurance rates sky high, pushing more people into Medicaid. Unnecessary procedures performed because the payor is the government and demand is inelastic. Medical costs become inflated by 10% annually.

Does any educated intelligent person really believe that we'd experience 10% annualized inflation in college and health care costs if not for government intervention? Would we really have less freedom if 0.001% of airplanes got blown up by terrorists instead of 100% of 6 year olds being molested by TSA?

[MediumTex]

I think that Harry Browne was trying to introduce a new way of thinking to a citizenry that has been convinced that the solution to every problem in society is more government.

One of the basic problems with government is that it is always in the mode of expanding its scope and powers, even when it says it is doing the opposite (see Reagan years for a great example of this).  I think that Harry Browne was trying to get people to think in terms of a government that is always contracting its scope and power, and to imagine what a world like that might look like.

I think that any time you are talking about radical change from the current system you must talk about it in broad sweeping terms, even though that's not the way you would actually govern if elected.  For example, I am certain that if Ron Paul was elected he wouldn't do half the things he is campaigning on, even though he sincerely means most of what he says.

[Lone Wolf]

Browne's point is that government performs almost every task poorly and at great expense.  It very frequently makes problems worse (sometimes much, much worse.)  It has very little incentive to perform well, lacks any form of market discipline, and can by definition only act out of coercion.

Thus, if efficiency and an emphasis on cooperation over coercion are priorities, it makes sense to shrink government (particularly the Federal Government) to the minimum necessary size possible.

Simply confining government to the boundaries established by the Constitution would almost certainly be a "good enough" solution and was precisely what Browne advocated.  (So, obviously, we'd still maintain a military.)  I think that many people are unaware of just how small government was (or how prosperous the United States was) before World War I.

The goal of Medicare was to reduce health care costs for the elderly.  It did the opposite.

The goal of the War on Drugs was to reduce rates of drug usage and associated crime.  It did the opposite.

The goal of the War on Poverty was to reduce poverty rates.  It did the opposite.

How about that Patriot Act?  How's Obamacare going?  Don't you just love the TSA?  Ain't that whole "SOPA" thing grand?  How about that Solyndra boondoggle?  Is it helpful that Federal agencies are personally involved in arming cartels with weapons that they've used to kill hundreds of people?

Most human problems are better solved without some ham-handed authoritarian solution.

Does any educated intelligent person really believe that we'd experience 10% annualized inflation in college and health care costs if not for government intervention? Would we really have less freedom if 0.001% of airplanes got blown up by terrorists instead of 100% of 6 year olds being molested by TSA?

Exactly right.  And then the government presents itself as the white knight who will save us from the problems that it has caused!  When you turn that perverse incentive over in your mind a few times it becomes completely unsurprising that government behaves the way that it does.

[moda0306]

doodle,

After reading "How I Found Freedom in an Unfree World," I gained respect for HB outside of his investing strategy... his belief in libertarianism comes from a very strong belief, first and foremost, in the individual and individual happiness, not necessarily thinking about how governments should be organized.

His input is extremely valuable on an individual level (how to find happiness in your life and rid yourself of bad relationships), but I found when he'd break into politics he'd simply be committing the fallacy of composition, among a few other misobservations.

For instance, he talks very negatively about vehicle safety regulation and conservationism, and has extremely simplistic logic to back these opinions up... he even went as far at one point to almost suggest we don't need any government at all, as our governmental structure simply gives our enemies something concrete to attack... so even a military is questionable in necessity.

Most of his lack of confidence is the fact that it's a big "group trap," where nobody's really motivated to do their job well, and it's trying to steal from taxpayers to deliver services to others that they obviously don't want as they've obviously prioritized other things in life.  The description of the group trap I found very useful, but he carries it way too far.  If his assertions were 100% true on the Group Trap, where sharing property & benefits for shared sacrifice never results in good things, then our nations cities would be a nightmare, our freeways wouldn't work, our patent judges would have no idea what they're doing, and our parks would be messy and unappealing.

I think he commits one of his own errors in judging the motivations of others.  He's a self-ascribed lazy, selfish person (I don't mean for this to sound bad... he simply admits it and doesn't think there's anything wrong with that.... and to be honest neither do I).  He warns in the book to assume that others will not want the same things you want, nor will they be motivated the same way, nor will they be easily persuaded.  Therefore, don't waste your energy trying to change their minds... wonderful advice!... but then he goes on to insist that everyone in government is motivated little to do a good job.  This is where I think he's projecting his own motivations onto others.

Patent judges, for some reason, seem motivated to accurately credit property to the deserving individuals.  A lot of our cities and freeways tend to function with amazing efficiency, and for the former, sometimes beauty.  People STILL like living there and pay the higher living costs and taxes.  Our parks, both local and national, can be amazingly well kept and nice to visit.  This shouldn't be possible, given

These things work because there are some elements of the Group Trap that must not manifest themselves the way he imagines them to.  I find it odd that he doesn't explore these areas where Group Traps exist and seem to function extremely well... for millions of people that could choose to leave and live out in the country somewhere with much less dependence on these group traps.  

[MediumTex]

Browne's point is that government performs almost every task poorly and at great expense.  It very frequently makes problems worse (sometimes much, much worse.)  It has very little incentive to perform well, lacks any form of market discipline, and can by definition only act out of coercion.

Under a very generous interpretation of the motives of politicians and bureaucrats, the government still reminds me of Lennie Small in "Of Mice and Men"--dimwitted, strong and unintentionally dangerous to those it purports to care about (though I don't mean to suggest that the government should meet the same fate as Lennie Small).

Imagine if you replaced "the rabbits" with "the taxes" throughout the book, and you will see what I mean.

[moda0306]

LW and TripleB,

There's evidence both ways here that I don't think you guys are acknowledging... The U.S. has very market and local-gov't-centric systems for education and healthcare compared to the rest of the world, and yet, very centralized national gov't systems seem to be beating ours handily in terms of price and quality for the majority of the population.

If you guys were right, you'd be seeing VERY expensive national healthcare systems that delivered piss-poor results.  In most of the developed world, this simply isn't true. The majority of the population received equal or better care at equal or lower price, for the most part.

I don't think it's too hard to imagine why, especially in healthcare... people are simply really bad consumers of the most important forms of healthcare.  First, you have to sign an insurance contract when you know little-to-nothing about the risks that you are faced with, and the insurance company not only knows much, much more (informational assymetry is a relatively simple-to-grasp market failure), but has every reason to try to avoid covering sick people, and avoid covering as many proceedures as it can.  If the customer wants a new insurance company, good luck if you have a preexisting condition.

Then, with doctors, you're faced with the same thing... not only does he know EVERYTHING and you know nothing about the product/service, but you're probably somewhere between moderately and severely sick to boot.  How is any consumer supposed to make an educated decision in this position?  Healthcare is simply a horribly inefficient market... at least as far as I can tell.  

Education may be different, but here it's even more easy to identify that other nationally-based education systems are doing a phenominal job of teaching the math & science that our schools are not.  

I'm not saying all this is proof big government works, but it should definitely give us pause when trying to decide how our systems should be designed.

[stone]

Education is especially hard because it is almost the job of an educator to teach students what they don't want to know. Otherwise why not just read up on it yourself.

What puzzles me is that the US veterans health care system is by some experts' estimation better than any health care program anyone can buy but people on this forum who had come across it had apparently found it extremely unappealing. Perhaps that brings home how gloss and front will can trump genuine quality. Gloss and front are extremely expensive and can actually work against quality health care provision if for instance doctors spend too long with each patient and so don't get enough packed in immediate experience.

[AdamA]

I'm curious how many PP users here appreciate Harry Browne's unique investing strategy yet fundamentally disagree with his political philosophy?

Good topic, Doodle.

I've been listening to the "Rule Your World" audio series, and think about this same topic.

I certainly think his philosophies outside of investing hold up very well for individual people within the context of interpersonal and professional relationships. 

One specific issue I wonder about is whether or not HB's advice on how individuals interact with governments was too passive.
It's one thing to insulate yourself from government shenanigans in the United States, but I wonder what his advice would be to people who live in places like North Korea. 

At some point, I think it becomes difficult to simply insulate yourself from the system.

[Lone Wolf]

There's evidence both ways here that I don't think you guys are acknowledging... The U.S. has very market and local-gov't-centric systems for education and healthcare compared to the rest of the world, and yet, very centralized national gov't systems seem to be beating ours handily in terms of price and quality for the majority of the population.

First, with the majority of health care spending in the hands of the government, it's difficult to argue that this is a "market" in any legitimate sense.  And in the Obamacare era it becomes more of an ironic joke than anything else.

Second, even with its flaws and government dominance, the US health care system gets far superior results when compared to Europe.  With 88% higher breast cancer mortality rates and 40% higher colorectal cancer mortality rate, are you really going to be hopping on a plane to the UK for your medical care?

In terms of price, I completely agree -- US costs are enormous and have spiraled out of control.  With the level of government meddling in our health care system, this comes as no surprise.  Apart from the obvious interventions, the nature of our laws and import restrictions has left the United States subsidizing drug R&D for the entire planet.  We can't afford to keep doing that.

What was once affordable has become much, much less affordable.  It is no coincidence that these prices started to spiral when government chose to "fix" it.

It's one thing to insulate yourself from government shenanigans in the United States, but I wonder what his advice would be to people who live in places like North Korea. 

I think that he would say, "Run."

The trouble for North Koreans is that if you manage to flee, unspeakable things await the family you leave behind.  North Korea is dotted with concentration camps for just such a purpose.

When the state has metastasized to that extent, the prices you pay for personal freedom can be very high indeed.

[stone]

Lone Wolf, the UK quite rightly gets touted as an example of how not to do health care but the UK is not "Europe". The problems with the US system also gets shouted about in the UK whenever anyone says we should move to a Swedish, Spanish, Canadian or whatever type system. I think pointing out how rubbish the UK (or US) system is, is a poor argument against adopting a system such as one from those countries that do have workable systems. Argue against "good" foreign systems not against rubbish ones (such as the UK) if you want to make a compelling case for the US system.

Again, you apparently do have a "good" system right in the USA with your veterans health care system.

[AdamA]

It's one thing to insulate yourself from government shenanigans in the United States, but I wonder what his advice would be to people who live in places like North Korea. 

I think that he would say, "Run."

The trouble for North Koreans is that if you manage to flee, unspeakable things await the family you leave behind.  North Korea is dotted with concentration camps for just such a purpose.

When the state has metastasized to that extent, the prices you pay for personal freedom can be very high indeed.

Well said.  I think trying to get HB's philosophies to withstand a totalitarian scenario like North Korea is like expecting the PP to withstand some freak occurrence like a comet hitting the Earth. 

Nothing works all the time. 

[moda0306]

LW,

The U.S. is signficantly more market-driven in healthcare than most of the rest of the world.  Obamacare simply revamps the regulatory framework to encourage a more universal healthcare system.  A mandate with private insurance is one of the more conservative, free-market ways of accomplishing universal coverage there is.  If the private sector is as dynamic as you say it is, it should be able to function around regulations. 

Are you sure that the US healthcare system, as a whole (not just the care available to the wealthiest) is actually superior to more socialized models?  It's obviously more expensive, and most articles I've read (no time now to seek them out) seem to have multitudes of different measures where other developed countries have much better healthcare outcomes than we do.

Regarding drug subsidization, I definitely agree this could be one area we're getting hosed.  I think that can be dealth with after we acknowledge the realities of where people are getting the highest quality care, though.

[WildAboutHarry]

WildAboutHarry, some current freedoms in the UK were not available in the 1800s. We can now walk about where ever we like over large sections of the UK (right to roam laws). In the 1800s people got beaten up trying to do that. Political demonstrations and strikes were put down very draconianly then. Most of the population did not have the vote then.

No doubt many things were different back then (e.g. surgery, dentistry ).  But I would argue that the intersection of government and individual lives is tremendous today relative to times past.

[moda0306]

WildAboutHarry,

It seems to me, in the 1950's through the 1970's, where much of the time it was illegal to own gold, and top tax rates were 70%-90%, and capital gains weren't given preferential treatment, banking regulations were much more strict, and local/state governments were very often built on a lot of Blue Laws, as well as legal frameworks that worked against minorities, that maybe we have a less intrusive government today than we had back then... but I don't know, it's just one way to look at it.

[WildAboutHarry]

maybe we have a less intrusive government today than we had back then

When I go to the bathroom I use a toilet that has a government-specified tank capacity, when I take a shower I use a government-specified flow regulator, when I remodeled my kitchen I was forced to install florescent lighting, I won't be able to buy incandescent bulbs soon (if incandescent bulbs are outlawed, only outlaws will have incandescent bulbs ), when I fly on a commercial airline I am searched, scanned, poked and prodded, if I want to ride a motorcycle I must wear a helmet, when I drive I must wear seat belts, I can no longer have an overseas bank account without filling out tons of paperwork, my property taxes cover things unimaginable (noxious weed board, et  al.), children must have social security numbers practically at birth, etc.

And the high tax rates back then were ridiculous, but they were combined with "loopholes" galore.  (Although I must confess when younger and I first heard the Beatles line from Taxman - "...if five percent appears too small..." - I assumed that five percent was the tax rate (which didn't seem too bad) rather than the 95% that it apparently was.

As I drove a U-Haul truck into Texas in 1983 I was happily surprised to see someone driving a pickup (of course) swigging a 16 ounce Budweiser.  That was outlawed soon thereafter.  Not Budweiser, driving with an open container of alcohol.

I'm not saying that low-volume toilets and shower heads, florescent lighting, airline passenger screening, motorcycle helmets, seat belts,  being against noxious weeds, or social security numbers are necessarily bad things, but where to stop?  I see no little capacity for self restraint in any local, state, or federal government or agency thereof.