Misrepresenting Adam Smith

I have recently been told twice, once in conversation and once online, that Adam Smith favored progressive taxation—on the second occasion at least, that he favored a progressive income tax. One passage from The Wealth of Nations was offered in support of the claim by both people, some additional ones by the online claimant. The passage:

The subjects of every state ought to contribute towards the support of the government, as nearly as possible, in proportion to their respective abilities; that is, in proportion to the revenue which they respectively enjoy under the protection of the state.

Taxation in proportion to revenue isn't progressive taxation, it's proportional taxation—in modern terminology, a flat tax. The quote not only isn't evidence for the claim, it's evidence against it—important evidence, since it is the first of the maxims of taxation with which Smith introduces his discussion of possible taxes.

Not only is Smith not endorsing a progressive income tax, he isn't endorsing any sort of income tax. Reading further into the passage, he successively rejects taxes on income from capital, taxes on wages, and taxes on the income of professionals. The only income he approves of taxing is the income of government officials. What he is arguing for is a system of taxation whose effect is proportional to income, not a tax on income.

The online claimant offered a number of other quotes which he thought provided evidence that Smith was in favor of progressive taxation. One of them was actually evidence, not that he favored it, but that he regarded a tax that fell more than proportionally on the rich as tolerable--"not very unreasonable."

But the most interesting one was the following:

It must always be remembered, however, that it is the luxuries, and not the necessary expense of the inferior ranks of people, that ought ever to be taxed.

This was offered as evidence that Smith wanted to tax the luxuries of the rich rather than the necessities of the poor. It was offered in the same words, with the same interpretation, on a Daily Kos web page I found which was making the same argument and using the same quotes.

Here is the full paragraph whose first sentence is being (mis)quoted.

It must always be remembered, however, that it is the luxurious and not the necessary expense of the inferior ranks of people that ought ever to be taxed. The final payment of any tax upon their necessary expense would fall altogether upon the superior ranks of people; upon the smaller portion of the annual produce, and not upon the greater. Such a tax must in all cases either raise the wages of labour, or lessen the demand for it. It could not raise the wages of labour without throwing the final payment of the tax upon the superior ranks of people. It could not lessen the demand for labour without lessening the annual produce of the land and labour of the country, the fund from which all taxes must be finally paid. Whatever might be the state to which a tax of this kind reduced the demand for labour, it must always raise wages higher than they otherwise would be in that state, and the final payment of this enhancement of wages must in all cases fall upon the superior ranks of people.

Note, first, that the first sentence is talking about "the luxurious and not the necessary expense of the inferior ranks of people." Smith is arguing, not for taxing the luxuries of the rich, but the luxuries of the poor. Changing that to "the luxuries, and not the necessary expense of the inferior ranks of people" makes it possible to misread it as "the luxuries of the rich, and not ...  ."

That misreading is impossible if you read the rest of the paragraph. Smith's argument is that a tax on the necessities of the poor will raise wages, hence be paid by the rich, and that one should therefor tax the luxuries of the poor instead. Not only is he not arguing for taxing the rich, he is arguing against taxing the rich.

There is another very popular misreading of Smith which was not made by either of the people I was arguing with, but does show up on the Daily Kos web page and in a variety of other places—the claim that Smith supported public schooling. The web page quotes (from another web page):

For a very small expence the public can facilitate, can encourage, and can even impose upon almost the whole body of the people the necessity of acquiring those most essential parts of education.

Smith has a long discussion of possible ways of organizing and funding education, in the course of which he argues both for and against a variety of alternatives, so it is easy enough to select out a passage which appears to be for government provision, such as this one. For an example on the other side:

"Those parts of education, it is to be observed, for the teaching of which there are no public institutions, are generally the best taught."

His final summary statement on the subject, however, is:

The expense of the institutions for education and religious instruction is likewise, no doubt, beneficial to the whole society, and may, therefore, without injustice, be defrayed by the general contribution of the whole society. This expense, however, might perhaps with equal propriety, and even with some advantage, be defrayed altogether by those who receive the immediate benefit of such education and instruction, or by the voluntary contribution of those who think they have occasion for either the one or the other.

Or in other words, some public funding of schooling is not unjust, but an entirely private system is also not unjust and might even be preferable.

It's also worth noting that the public involvement he is considering is much less than what we take for granted. Thus he writes, immediately after the sentence that the web page quotes:

The public can facilitate this acquisition by establishing in every parish or district a little school, where children may be taught for a reward so moderate that even a common labourer may afford it; the master being partly, but not wholly, paid by the public, because, if he was wholly, or even principally, paid by it, he would soon learn to neglect his business.

Not, I think, an opinion that supporters of our public school system would be willing to endorse.

I find it amusing that the Daily Kos piece starts out with:

"Conservatives love to quote Adam Smith, the Father of Capitalism. But I doubt that many of them have actually read his works."

The author of that also likes to quote Smith—and also has not read his works.

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(added later)

Googling around, I find about the same number of hits for the two versions of the first sentence of the paragraph I quoted: "luxuries," and "luxuriant". Not all of the former sort are from webbed quotes--some are from webbed texts of the book. That suggests that it may be different in different editions. Checking various sources, the third, fifth, and sixth editions all have "luxuriant." The fifth was the last edition published in Smith's liftetime, the third apparently the edition in which errors in the first and second got corrected; those two seem to be the basis for most modern editions.

I haven't yet located a source for the text of the first edition—it's possible that "luxuries" is a mistake there. Or that it was added by some editor or printer in some later edition.

If so, the version I object to is not a deliberate misquote. But reading the rest of the paragraph makes it clear that it cannot be interpreted as arguing for a tax on the luxuries of the rich.

George Orwell v Frank Richards

apropos of nothing in particular ...  .

I've been browsing through the first volume of the Letters and Essays of George Orwell, and came across a particularly interesting and entertaining exchange. It starts with a long article by Orwell, written in 1940, on "Boys' Weeklies," sometimes called "penny dreadfuls" although, as Orwell points out, they actually sold for tuppence.

The Weeklies, of which Orwell identifies ten, produced by two different publishers and including two older series somewhat different from the others, were very popular reading, targeted at boys up to about fourteen or fifteen. All of the stories in the two older ones and many in the others were set in British public schools; Orwell suggests, plausibly enough, that much of the inspiration for the setting was Kipling's Stalky and Company.

Orwell focuses mostly on the two older ones, each of which has a stock cast of characters, a setting that shows no sign of changing for the thirty years over which they had been coming out, and recognizably stylized plots and dialog. He comments that although each claims to be written by a single named author—"Frank Richards" for one series and "Martin Clifford" for the other—it is obvious that a single author could not have done thirty years of weekly stories, and that the stylized writing is in part a way of maintaining the illusion of a single author. 

The essay is interesting both for the detailed, and to some extent sympathetic, description of the weeklies and for Orwell's analysis of their political implications. He thinks they are designed, probably deliberately by the owners of the firms that publish them, to indoctrinate boys with  conservative views—respectful towards the upper classes, ignorantly patriotic, contemptuous of foreigners, blind to the real problems of British society. The essay ends with a somewhat tentative suggestion that someone ought to produce a left-wing equivalent, and a discussion of some problems in doing so.

It is an interesting essay on its own merits. Still more interesting is the response—an article by Frank Richards rebutting Orwell and defending his own work. It turns out that, contrary to Orwell's confident claim, all thirty years of weekly stories by "Frank Richards" were produced by the same person. Further, as Orwell comments in a later footnote to his essay, Frank Richards was also Martin Clifford, so the same person produced, for thirty years, the contents of two different weekly magazines for boys.

He shows himself to be an intelligent and articulate writer. His views are conservative in a general sense; he makes it clear that the setting of the stories is an unchanging 1910 England because he does not think much of the changes since. But he also makes it clear that the reason his stories do not include strikes, unemployment, labor unions, and a variety of other features of the real world is not that he is unaware of such things but that he believes that providing boys an imaginative foundation in a secure world helps equip them to face future difficulties in a world much less secure.

Since Frank Richards' reply is available online, you can see if you agree that both halves of the exchange are well worth reading.

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After posting this I googled for Frank Richards. It turns out that his real name was Charles Hamilton. He wrote not only the two weekly magazine series that Orwell discusses but many others as well. His total output is estimated to have been about a hundred million words, more than 5000 stories, roughly equivalent to 1200 novels of average length; he  is listed in the Guinness Book of Records as the world's most prolific writer.

How to Eliminate the Publishing Industry: Take Two

In a post about three and a half years ago, I wrote:

Publishers serve three important functions:

1. The physical production and distribution of books.

2. Assisting authors in writing books.

3. Filtering books, selecting from the very large number that potential authors wish to write a small number to actually be published.

I pointed out that the first function was no longer necessary, given the ease with which an author can publish his book himself by webbing it (as I have done with several books) or by using an online Print on Demand service (as I am in the process of doing via Amazon's CreateSpace for a collection of medieval and renaissance recipes). If I were writing that post today I would add a third option—selling your work as a Kindle file on Amazon, as I plan to do shortly with my second novel. The second function is useful, but it does not require a publisher. Copy editing at present is largely done by free-lance editors; there is no obvious reason why other forms of editing could not be. The best editorial assistance I ever got came not from my editor but my agent.

That leaves only the third function, and I suggested that there ought to be some way of providing it via decentralized sources of information online, as Google presently provides the analogous function of identifying which pages best match your search criteria. My elder son was, at the time, working for Google; one commenter on the post remarked that when he went home for vacation, all his mother expected him to do was to take out the garbage and shovel the walk. I expected my son to abolish the publishing industry.

It appears that the job is already being done, and not by Google. I recently came across a webbed description of how readers of fan fiction, amateur stories set in the world of Star Trek, or Harry Potter, or other well known works of fiction, solve their problem of sorting out the treasure from the trash.

Munich 2011: Libya and Bahrain

The agreement by which the governments of France and Britain permitted Hitler’s seizure of the Sudetenland is often said to prove the case for an interventionist foreign policy: If only Hitler had been stopped then, it might not have been necessary to stop him, at much greater cost, a few years later. In my view, this reading gets the logic exactly backwards. France and the U.K. had interventionist foreign policies; that was why Hitler needed their permission before invading Czechoslovakia. The lesson of Munich is that countries with interventionist foreign policies cannot be trusted to intervene when they should.

Or not to intervene when they shouldn’t, as illustrated by a bit of history that I learned from Churchill’s account of WWII. Hitler's first attempt to annex Austria was abandoned when Mussolini announced that Italy would not tolerate it and made his point by moving Italian divisions into the Brenner pass. What eventually made Mussolini switch sides was the response of the U.K. and its allies to his invasion of Abyssinia. They sharply criticized the Italian action, took ineffectual steps against it, but stopped short of the actual use of military force. Mussolini concluded, reasonably enough, first that the British and French were not his friends and second that they would not be very dangerous enemies.

The next time Hitler moved against Austria it was with Italian permission. Incompetently executed interventionist policy not only did not prevent the second World War, it helped to cause it.

All of which brings me to the depressing present, with Barack Obama playing Neville Chamberlain to Qaddafi’s Hitler. The consequences of Munich were not limited to the loss of the Sudetenland. Similarly here. It was only after it became clear that the U.S. and its allies were unwilling to oppose Qaddafi with anything more than words that the Bahraini rulers concluded that it was safe to bring in Saudi troops to violently suppress their opponents.

"Deep Spending Cuts"

"A leading Democrat is predicting the Senate will reject House Republicans' deep budget cuts.

...

Senate Democrats has offered a measure that would trim $6.5 billion from domestic agencies, as President Barack Obama has proposed. That comes in response to a House-passed bill that would cut $61 billion from the federal budget." (News Story)

The cuts are in a $3.8 trillion budget. The proposed "deep cuts" of $61 billion are less than two percent of that.

Interesting Piece on Assange

A long article on Assange which links him to the Cypherpunks, an email group which it accurately describes me as having been a fellow traveler of. For the influence of the Cypherpunks, and in particular Tim May, on my views see this piece.

The most interesting part is the description of the tactical theory behind Wikileaks:

The more secretive or unjust an organization is, the more leaks induce fear and paranoia in the leadership and planning coterie. This must result in minimization of efficient internal communications mechanisms (an increase in cognitive 'secrecy tax') and consequent system-wide cognitive decline resulting in decreased ability to hold onto power as the environment demands adaptation.

Hence in a world where leaking is easy, secretive or unjust systems are nonlinearly hit relative to open, just systems. Since unjust systems, by their nature induce opponents, and in many places barely have the upper hand, leaking leaves them exquisitely vulnerable to those who seek to replace them with more open forms of governance.

(From a 2006 blog post by Assange)

I don't know if it will work, but it is an ingenious idea for creating an institution designed to gradually improve the world.

Are City People Rude?

It seems to be a widely held belief, but my own experience traveling does not support it.

My wife likes to claim that the reason to have a map in London is not to actually read it but because as soon as you take it out a londoner will ask you where you want to go and offer to tell you how to get there. I've just returned from a couple of days in New York; the strangers I spoke to, mostly asking directions or checking that I was on the right subway train, were very helpful. The nearest thing to an exception was one crazy bag lady in the subway who yelled at me when I asked another passenger a question. Even in Paris, notorious for bad treatment of visitors, I found no evidence to confirm the reputation.

I Will Be Speaking in New York This Thursday and Friday

I am one of several participants in an event on the subject of privacy at Columbia Law School this Friday, starting at noon. After agreeing to participate, it occurred to me that if I was going to fly across the country it would be worth trying to arrange something more than the hour or so I expect to spend on my part of the event, so I emailed several libertarian friends to ask if they knew of libertarian supper clubs or the like currently functioning in New York City. The result is that I am now scheduled to give two talks:

Thursday evening, starting at 7:00, I am joining Gary Johnson on the podium for the monthly meeting of the Junto at The General Society of Mechanics and Tradesmen, 20 West 44th Street.

Friday evening, starting at 7:00, there is a talk arranged by Todd Seavey at Lolita Bar (266 Broome St. on Manhattan’s Lower East Side; Broome runs east-west one block south of the Delancey St. FJMZ subway stop). My topic will be "The Third Edition of The Machinery of Freedom: A Preview."

As best I can tell, neither talk requires any advance reservation.

Teasing out the Truth

One of the problems all of us face is how to figure what things we read are true and what are false. This has always been a hard problem and still is. But the internet sometimes makes it easier, makes it possible, from information we can obtain at first hand, to judge whether a particular information source can be trusted.

Let me offer two examples, one in scientific controversy, one in political.

I've recently been reading The Seven Daughters of Eve by Bryan Sykes, a book describing research, much of it by the author, that used mitochondrial DNA to investigate human prehistory, questions such as where the Pacific islanders came from and whether modern Europeans are the descendants of European hunter/gatherers who learned to farm or Middle-eastern agriculturalists who spread into Europe.

One of the incidents described in the book involved a clash between the author and a geneticist by the name of Erika Hagelberg who reported results from genetic analysis of the population of a particular Pacific island that appeared inconsistent with the accepted view of how mitochondrial DNA worked, casting serious doubt on the results of Sykes' (and other people's) research. Sykes happened to have some samples from the same island; he analyzed them and failed to find the results she had reported. He asked her for samples to analyze so that he could check her results; she did not send any. Eventually they clashed at a conference; she insisted that her results were correct but offered no explanation of why she had been unwilling to let him check them.

A year later, under pressure from her coauthors, she conceded that the results were bogus, due to a mistake in her analysis.

All of this is Sykes' account of what happened. A skeptical reader should recognize that he is getting only one side of the story and has no way of knowing how accurate it is.

Except, in this case, he does.

Out of curiosity I googled "Erika Hagelberg" and found, among other things, a book review she had written of The Seven Daughters of Eve. Its final paragraph read:

It may seem churlish to criticize a personal story of research in human evolutionary genetics designed to appeal to the public, but the tedious narrations of the lives of the clan mothers, lack of bibliography, and casual treatment of facts, rules the book out of the category of serious popular science. In the context of Sykes's commercial venture, Oxford Ancestors, which markets DNA-based genealogical information to people hungry for roots, the book makes sense as an advertising tool. However, for an accurate account of an inspiring field of science, readers should look elsewhere.

The review contained no mention of the fact that its author was herself was a character in the book and that its portrayal of her was unflattering, facts surely relevant to anyone who read the review and wanted to know whether her evaluation of the book could be trusted. That fact provides me evidence, first hand evidence, about the author of the review, evidence that supports Sykes' version of what happened.

My second example is from the world of political controversy, specifically the recent attempt by various writers to focus attention on the Koch brothers, two very wealthy men who have donated substantial amounts of money to causes the writers disapprove of. One prominent article was by Jane Mayer and appeared in the New Yorker. One of its themes was that the Koch brothers spent their money subsidizing causes that were in their corporate interest, such as opposition to government regulation of business and legislation related to climate change, and that their money was at least in part responsible for the Tea Party movement.

In this case, unlike the first, I actually knew something about the subject. The Kochs have been major funders of libertarian causes for decades. As a libertarian writer and public speaker, I have almost certainly at some point or other been paid money that ultimately came from them.

For the most part, my inside information does not tell me whether Mayer's account is true, since most of it deals with activities by the Koch brothers that I have not come in contact with. It is clear that her selection of facts leaves out things that don't fit her narrative, such as the fact that the Institute of Justice, funded in part with Koch money, has been a leading opponent of the use of eminent domain to seize property and give it to corporations, or the consistent antiwar position of the, also Koch subsidized, Cato institute, or the large contributions that the brothers are reported to have made to an ACLU attack on the Patriot Act during the Bush administration. But none of that tells the reader anything more than that the author has an axe to grind, which is in any case obvious.

There is, however, one minor detail in the article that struck me because it is demonstrably false and the author ought to have known it was false. She writes:

Indeed, the brothers have funded opposition campaigns against so many Obama Administration policies—from health-care reform to the economic-stimulus program—that, in political circles, their ideological network is known as the Kochtopus.

The term "Kochtopus" was coined by the late Samuel Konkin, a libertarian activist critical of the Kochs' influence on the movement, about thirty years before Obama was elected president. That is a fact that Mayer could have discovered with a few minutes on Google or a quick look through Radicals for Capitalism, a history of the libertarian movement that she mentions in her article. Either she did not bother to check her facts, which is a reason to be skeptical of other facts she asserts, or she deliberately transferred the term to a context that better fit the narrative she was constructing, which is a reason to distrust everything she writes.

One virtue of the Internet is that it makes it easier for me to learn, from first hand evidence, something about the honesty and competence of a source of information. A second virtue is that it makes it easier for me to convey my conclusions in a form my readers can check. I have provided links to both Erika Hagelberg's review of Bryan Sykes' book and Jane Mayer's New Yorker article, and enough information about the history of the term "Kochtopus" so that a reader can readily verify my account. And, if you follow my link to the Amazon page for Sykes' book and use their "search inside this book" option to search for the name "Erika," you can check my account of the book's description of the clash between the author and Erika Hagelberg. You thus have all the tools to do for my writing what I did for theirs.