Why I’m Not Concerned About Climate Change At All

The never ending climate crusade is incredibly tiresome. This week we’ve got heavily indoctrinated adolescent children engaging in a climate boycott ― an issue they almost certainly do not understand and are only doing so because their school teachers have grossly exaggerated the threat.

Of all the political issues I’m concerned with, climate change is at the bottom of the list. Not because I’m a “science denier”, as you’ll see I accept the climate is warming for the most part, but because the severity of the issue is grossly exaggerated for political reasons and because technological progress will make the issue moot in short order.

In this post I want to comprehensively demonstrate just how much the severity of climate change is exaggerated and show that literally “do nothing” should be considered a viable option.

The UBI and a Tale of Two Countries

The purpose of this tale is to illustrate the impact of welfare state policies (including but not limited to the UBI) on the economic outcomes of welfare recipients.

Consider that any taxation of high income earners and redistribution to low income earners will inevitably reduce the economic growth rate. That is, it will reduce the rate at which people’s income grow. Why is this? There are a variety of reasons ― reduced incentive to work, deadweight loss of taxation etc, but here I just want to focus on the impact on investment. Investment is a primary driver of economic growth. It allows us to use resources more efficiently, produce more stuff of value, thus raising real wages.

When we tax wealthy people they either have to reduce consumption spending (think spending on cars, vacations, yachts, etc) or reduce investment spending (think factories, machines, things that increase labor productivity) in order to pay the tax. As a general rule, the wealthier one becomes the larger percentage of their income they tend to invest. And thus the reverse is true, as their incomes go down the lower percentage of their income they tend to invest. Thus taxation (which is a lowering of income) can be expected to be paid primarily out of funds they otherwise would have invested.

Hoppe, Libertarianism, and Immigration Restrictions

Somewhat amazingly there is a relatively big divide among libertarians on the issue of immigration. Libertarianism is traditionally thought to favor free and open immigration policies since restricting migration can only be done through authoritarian government policies which are anathema to the libertarian.

Hans-Hermann Hoppe is probably the loudest voice in the libertarian community calling for restrictive immigration policies and has built up a sizable following doing so. A twitter user recently made me aware of a 1998 article of his outlining his position in depth which I will critique here.

If I can summarize his position it appears to be:

Anarcho-Capitalism and Child Rights

Every now and then the discussion of anarcho-capitalism on the internet comes back to child rights. Often non-anarchists accuse anarchists of holding a grotesque position on child rights. It typically goes something like this (this is from an actual Facebook post):

An-caps, according their own logic, can not interfere when a parent is caught raping their own child, because they believe children are property, and they dont have the right to interfere while someone destroys their own property.

I’m not sure I’ve ever heard anyone express a view this extreme. Murray Rothbard probably came the closest arguing that the isn’t any such thing as neglect as parents must remain free from any sort of positive obligations. But even Rothbard strongly condemned child abuse and never argued that the child is the parent’s property with which they can do whatever they want. His view on neglect, which is probably his most extreme position, doesn’t seem to be widely shared in by many other libertarians or anarchists. At least from my view point.

How Anarchy Would Work

To most people an anarchist is someone who advocates lawlessness. Anarchy is used as a synonym for chaos and disorder. This is a rather unfortunate mischaracterization as most of us who identify as anarchists (at least of the libertarian persuasion) do not, in fact, advocate lawlessness. We believe in law and order and justice as much as the next person. We just believe these things can be provided more efficiently and far more ethically with alternative legal arrangements and institutions. We believe that democracy (or representative democracy) is not the best possible way to provision a legal system and that society can indeed do much better. In this essay I’ll provide a sketch of how an anarchist legal system would work and demonstrate why I consider it to be superior to the present system.

Bitcoin and Gresham’s Law

Another day, another mainstream news outlet showing off its inability to reason about Bitcoin economics. Today we have Bitcoin’s Wild Ride Shows The Truth: It Is Probably Worth Zero in the Wall Street Journal where James Mackintosh informs us that, among other reasons, Bitcoin will ultimately be worth zero because:

Even if bitcoin worked better, it is in a Catch-22 because of Gresham’s law, the nostrum that bad money drives out good. Given the choice of spending inflationary government-issued money or something which holds its value, everyone would spend the bad paper stuff and hoard the bitcoin.

That bad money would drive good money out of the market is a pretty amazing statement if you stop and think about it. Why would this be? In every other instance good products drive bad products from the marketplace. Yet money is presumed to be the exception to this rule. Mackintosh tries to pin this phenomenon on deflation, however this argument relies on poor reasoning is very easy to dismiss. I wont rehash the arguments here but will point you to a couple previous posts of mine [1, 2].

But more importantly “bad money drives out good” isn’t Gresham’s law! To understand the correct version of Gresham’s law, give the following video a watch:

Why Spend Bitcoin?

Nothing causes people to lose their economic sense more than Bitcoin. I’ve had quite a few opportunities to highlight economic fallacies on this blog over the years. This time I’m going to call out Fred Wilson for this comment:

And that point is that you can’t keep spending something that goes up as much as Bitcoin has.

So I don’t spend Bitcoin anymore.

I hold it.

It’s a store of value now.

That much is clear.

The Bitcoin Cash Roadmap

It has been exactly once month since Bitcoin Cash split away from Bitcoin Core and by any reasonable standard it should be considered a success. At the time there was a huge amount of uncertainty. Would anyone support the new fork? Would it trade on any exchanges? Would it survive the initial difficulty adjustment? Would anyone mine it? The answer to all these questions turns out to be yes. And while some of the loud voices in the Bitcoin community went on the record predicting that Bitcoin Cash would be worth “not even a dollar each”, it’s currently trading around $622 and has a $10 billion market cap making it the third most popular cryptocurrency.

So where does Bitcoin Cash go from here? While I’m personally not affiliated with Bitcoin Cash per se, though I did write a Bitcoin Cash wallet, I’ve been following it closely enough to report on what seems to be a growing consensus around it’s long term roadmap. And I have to say, while the roadmap is probably more risky than Bitcoin Core’s, it’s certainly much more ambitious and much more capable of delivering meaningful scaling if successful.

Bitcoin Cannot Be Only a Store of Value

In December I wrote an article, Can Bitcoin Exist Only as a Store of Value?, in response to what I perceived to be an increasing belligerence among some people in the Bitcoin community who argue that Bitcoin doesn’t need any actual use cases because “store of value” is the use case. In that article I attempted to show that there is no such thing as an asset that has no utility except as a store of value. A sentiment recently echoed by Rick Falkvinge on Twitter:

You cannot have something be a store of value, except as a _secondary_ function, where a primary function generates ongoing demand.

— Rick Falkvinge (@Falkvinge) June 7, 2017

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Sadly, the recent run up in the Bitcoin price has caused people to double down on the store of value argument, seriously jeopardizing Bitcoin’s future in my opinion.

So let’s revisit the Store of Value. Maybe I’ll do a better job explaining it this time.

On Craig Wright

I’m probably risking being run out of polite society with this post but I figured I would write up my thoughts on the Craig Wright saga. My purpose here isn’t to argue that Craig Wright is Satoshi Nakamoto, I don’t think anyone can say definitively one way or another, but rather to highlight what I view to be non-critical and/or biased thinking by most people who have commented on it.

Before we start let’s review some epistemology. Often times when we’re evaluating conspiracy theories, 9/11 was an inside job for example, we’re confronted with theories that are not falsifiable and thus we can not employ standard methods to determine truth or falsehood. In the case of 9/11, there is literally no evidence that can disprove or falsify the theory that the U.S. government was behind the terror attack. Any evidence that comes to light that seems to falsify the theory just ends up pushing the conspiracy back one layer. If someone were to testify that they watched Mohammad Atta plan and execute the attack from start to finish without outside influence, well that that guy must be lying! He’s in on the conspiracy too! And thus the conspiracy gets pushed back one layer deeper and can never be falsified.