From: Bart  Croughs <bart.croughs@tip.nl>
Date: Sun, 18 Aug 1996 03:49:21 +0800
To: "'cypherpunks@toad.com>
Subject: Re: National Socio-Economic Security Need for Encryption Technology
Message-ID: <01BB8C73.39F4E8E0@groningen12.pop.tip.nl>
MIME-Version: 1.0
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	Timothy May wrote:

      >Others have shown how meaningless your repeated calls for a proof are, as
      >so many assumptions must be carefully spelled out.

>To give an example of how hard the situation is to analyze, consider the
>computer and chip industries. (If you argue that your "theorem" is for
>nations in the aggregate, and not any particular companies or even
>industries, then I will maintain that my example holds pretty much true for
>automobiles, pharmaceuticals, chemicals, and so on._

>The computer and chip industries move certain investments abroad, to
>Malaysia, the Phillipines, Indonesia, Mexico, and so forth. But by moving
>these investments abroad, they believe their net market size,
>profitability, shareholder value, etc., will be enhanced. Else they
>wouldn't do it.

>Multiply this by all the industries....

>Now, would "the economy" be "better off" if Intel, say, had not moved
>assembly operations to Malaysia in the 1970s? Perhaps Intel would now be
>bankrupt and gone, as so many of its rivals of the time are now gone and
>barely remembered.
>You see the problem? Who can say what "better off" is, given that we can't
>run history down alternate paths as an experiment.

>Your one-track mind is truly astounding. We've had kooks and oddballs on
>the list before, but never one who has written a dozen or more posts asking
>the same ill-phrased question over and over again.

So you say that my question can't be answered because the situation is too difficult to analyze, "given that we can't run history down alternate paths as an experiment." The situation is indeed hopelessly difficult if you think that economics is an empirical (experimental) science. But, as an Austrian, you should know that economics isn't an empirical science; it's a science that deals with the logic of human action. It starts from the axiom of human action, and all the other axioms of economics follow from this axiom by deductive reasoning. This is called the praxeological method. The answer to economic problems can only be given by reasoning, not by running experiments in the real world. Read Mises (Human action), Rothbard (Man, economy and state) etc. for further information. To prevent you from claiming this isn't true, I will quote Rothbard (in 'The foundations of modern Austrian economics', p. 19, ed. E. Dolan): "Praxeology rests on the fundamental axiom that individual human beings act(...) The praxeological method spins out by verbal deduction the logical implications of that primordial fact." etc.
So, it really doesn't matter at all that we can't run history down alternate paths as an experiment, because the kind of empirical 'data' that such experiments would generate are not very helpful in the first place. Fortunately, situations that are at first sight hopelessly difficult can sometimes be analyzed and simplified by performing a thought experiment. That's what I did when I offered my 'reductio ad absurdum' proof. I didn't use empirical data, I used logic and reasoning; that's the way it should be done in economics. So far, you didn't rebut the proof I offered. You only argue that my proof must be wrong because the situation is too difficult to analyze because of all the empirical data that are lacking. That argument is, as I explained above, not to the point. And the fact that you take refuge in name-calling makes me suspect that subconsciously you don't find it very to the point yourself either.
I understand it's not pleasant to be rebutted every time you answer my posts, but I fear it's something you will have to get used to. Of course, you could also consider making better arguments (after reading the books I suggested), or else stop posting on the subject.

Bart Croughs