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Boots Dorfman

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Friction vs. Failure: Wasteful Competition and the Lessons of History
By Boots Dorfman   
Rated "G" by the Author.
Last edited: Monday, March 17, 2008
Posted: Monday, March 17, 2008

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This screed was written prior to Sarkozy's victory aqt the polls, divorce, remarriage and current political and economic travails. A full version of this essay may be found at my blog at:

The law of supply and demand is a lot like the law of gravity: Both laws will function with or without our recognition or approval; either law is ignored at one's own peril.

To that axiom might be added the observation that there are two models upon which a civilization may build its economic and political institutions. One is competitive with a bare minimum of authoritarian regulation, the other is authoritarian with a bare minimum of competition.

The thoroughly tragic history of the late U.S.S.R. demonstrates what happens to a modern society which adheres to the latter model. In absence of healthy competition between providers of goods and services (and providers of ideas), a nation is left with the unhealthy competition of warring cliques, each seeking power at any cost, each manifesting a singular disregard for the fortunes of the populations theoretically in their care.

Ayn Rand had an interesting take on this dynamic: She said in the absence of the "aristocracy of money" one could only be left with "the aristocracy of pull." As usual, her terms were carefully chosen and as usual her logic was unassailable.

Consider: In a post-feudal world, the "aristocracy of money" is founded upon creativity and productivity and thrives on competition.

The "aristocracy of pull" is founded on whom one knows, which favors may be called in - leveraged through bribery or blackmail - and whose backside it is advantageous to kiss on a quid pro quo basis. The "aristocracy of pull" rejects competition as "wasteful," then proceeds to squander the wealth of nations in eternal power struggles while the interests of the people languish, indeed, disappear altogether in the fog of perpetual wars between dueling oligarchies.

The result of years of national life under the aristocracy of pull is near-universal repression, barbarity, institutional cruelty on an unimaginable scale and, eventually, economic collapse followed closely by political collapse. So it was with the U.S.S.R. So it will always be in those societies which assume competition is "wasteful" while overreaching governmental authority is "in everyone's best interests," even if "everyone" is unaware of the validity of that spurious supposition.

What does history say about government-protected private competition vs. top-down, command-and-control economic/political systems?

The answer is to be found in Paul Kennedy's landmark work, The Rise and Fall of the Great Powers.

Kennedy posits that the great Mogul Empire of South Central Asia (including most of the Indian subcontinent) and the dynasties ruling China had employed government power to unify their diverse peoples and thereby achieve a high degree of civilization while Europe was mired in the Dark Ages. Those great Asian civilizations had accordingly created better institutions with, on the whole, less internal warfare and greater degrees of progress and societal health.

The future great powers of Europe never had that option. Following the fall of Rome, there was no powerful unifying state to prevent constant competition between the warring kingdoms and principalities. Under those bloody, create-or-die circumstances, each language group and amalgamation of small powers was constrained to compete in military conflicts, and, logically, in the invention and creation of economic/political systems which would foster a maximum of arms-related research and development.

During the beginnings of the modern era, it became matter of brute fact that whichever coalition had the best armaments in a given conflict would have an advantage which, often as not, could not be overcome by substantially larger numbers of warriors fielded by its foe. From the English longbows of Agincourt to the Krupp Works cannon employed in the Franco-German war of 1870 to the American atomic bombs which ended the war in the Pacific Theater in 1945, superior firepower has had a huge influence over the winners and losers in any given conflict.

Manifestly, it was those economic systems which allowed more or less free investment opportunities plus low tax burdens upon the investor classes (especially in England and in the Low Countries), which helped foster the invention of the next generation of more powerful weapons systems.

Thus, even though the Chinese possessed gunpowder and primitive cannon long before, say, England, by the time of the great 18th and 19th century European colonial expansions into Asia, the European conquerors possessed armament of far greater firepower and destructiveness.

Modern parallels?

My own observation, working from Kennedy's historical findings, is that a 20th century parallel to the success of the European "gunpowder empires" over older, better organized Asian empires might easily be identified in the history of Germany's National Socialism and the Communism of the U.S.S.R.

In the case of the Nazis, freethinking scientists and inventors, especially those of despised classes - including but not limited to the Jews of Central Europe - were actively discouraged from engaging in their life's work, indeed, they were persecuted and forced to flee to the West, especially America, where they were essential to the undertaking of creating the first controlled nuclear chain reaction … and the first atomic bombs.

The military research-and-development blunders of the U.S.S.R. were similar, but telling in their differences. Let's look at the U.S.S.R. at the beginning of the Cold War. At that time the victorious Red Army toted back to Stalin, as war trophies, a number of the V-2 rockets invented by Werner von Braun. As it happened, Stalin had on staff a brilliant scientist, one Sergei Korolev, whose understanding of rocketry was considerably more advanced than von Braun's. This scientist begged Stalin to allow him to make improvements upon the V-2 template. Stalin, being Stalin, refused, and demanded the entire thrust of Soviet rocket science be focused upon making lots and lots of V-2s, exactly the way von Braun had designed them.

The Lessons of History Writ Large

History shows, time and again, in century after century, civilization after civilization, that there is nothing “wasteful” about competition. 

To the precise contrary, it is the super-regulatory state which impairs not only advances in societal health via new medicines, labor-saving machines and better understandings of the human condition in the humanities, but which also habitually presents obstacles to a nation-state's security and ability to defend itself from outside aggression.

And since warfare is, in many ways, an illustrative microcosm of all other collective undertakings of a given nation-state, it is reasonable to believe that while a certain amount of government regulation is necessary to discourage theft, fraud, unfair trade practices and the myriad of depredations upon economic liberty which twisted, predatory minds may dream up, the proposition that competition, by creatively harnessing the profit motive, is essential to the survival (or at least the autonomy) of any nation-state, is undeniable.










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Reviewed by Charlie 3/17/2008
And that is undeniably a good point, and very well stated and plotted out. I bleed for the free bird that would not be tamed, who is being tamed none-the-less by those who would weild its power for personal strategies-- by those who do not realize that to weild a tamed bird, is to weild a falicy! Sorry for the rant. Good wrighte.

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