Roxanne meet Joseph??

[colddiesel]

I read some of the political threads and occasionally, perhaps unwisely contribute to them. It has been a great surprise to me that so few writers from the conservative or libertarian side refer to the man I think should probably be their intellectual hero: Joseph Alois Schumpeter 1883-1950ta

Very early, 1909 Schumpeter analysed Marx and concluded that whilst he was a fine economic historian, his political and social idealism were dangerously defective and doomed to inevitable failure and collapse.

However, what makes Schumpeter particularly interesting is that he saw social democratic systems as more dangerous to the future of capitalism than communism. He predicted that as Capitalism succeeded it would enable a large intellectual liberal class to develop which was more interested in the regulation and distribution of wealth than in its creation.They would eventually through their interference and meddling stifle the opportunities for the entrepreneur ( more correctly Unternehmergeist) to make the creative leaps necessary in his theory of "Creative Destruction". The entrepreneur was of course Schumpeter's hero. The stifled social democratic society is perhaps best typified by present day Japan

Schumpeter's criticism of Marxism, social democratic philosophy and Keynsian economics is best known from two books," Capitalism Socialism and Democracy " 1942 and the posthumous "History of Economic Analysis 1954" (because prior to his arrival at Harvard in 1932 he published mainly in German)

Until recently Scumpeter was mainly known as " the father of Econometrics" but now it has emerged that his political and social predictions were surprisingly accurate and way ahead of his time. His reputation is therfore improving rapidly.( fellow Academics thought poorly of him because they of course represented the 'liberal intellectual 'class)

I would be interested to know what other people on this Board think of Schumpeter's work.

Apart from his work Schumpeter also had a particularly adventurous private life.

Trysail made a brief reference to Schumpeter a couple of days ago which prompted me to start this thread

 

[amicus]

Schumpeter was on the 'must read' list for those studying Objectivism, along with Hayek and de Jouvenal, although for me, it was a long time ago, still very much valuable to those seeking to comprehend a free market, free enterprise and the relationship to individual liberty. And I do believe Roxanne made reference to a work of Schumpeter just recently.

Thanks for the heads up...

Amicus..

 

[Roxanne Appleby]

Fascinating, thanks CD. I have not read Schumpeter, but he has turned up often in my studies, and in unexpected places, like poli-sci classes. I will explore and say more when I've done so.

Of course the concept and phrase he's best known for these days is "the gales of creative destruction," a huge feature of the massive increase and accelleration of productivity over the past 30 years.

BTW, I agree with JS's characterization of Marx that you describe - Marx's historical materialism has stood up well and explains much, although it is taken to absurd extremes by marxians (including some here) who apply it to groups in a way that almost entirely deterministic.

 

[rgraham666]

Most people in favour of 'Creative Destruction' like it because it allows them to be destroyers. "See? Schumpeter says it's okay to destroy people and things."

They change their tunes in a hurry when it's their nuts in the vice.

 

[al_Ussa]

Awww... I was kinda hoping that it'd be Joseph as in the Biblical Joseph and Roxanna as in the Sogdianan woman Alexander the Great knocked up... you know, despite them not living in the same part of the world or even time period.

But just imagine the fuzzy babies they'd have...

 

[colddiesel]

Most people in favour of 'Creative Destruction' like it because it allows them to be destroyers. "See? Schumpeter says it's okay to destroy people and things."

They change their tunes in a hurry when it's their nuts in the vice.

You clearly have not read the man's original writing. Schumpeter does not attach a moralising aspect to his observations. He says that entrpreneurial creativity is necessarily causative of the destruction of what prevailed before albeit sometimes with human costs to the progress achieved..

However, if that entrepeneurial creativity is stifled, regulated and limited by the non-creative educated class, stasis will ensue resulting in a slow and inevitable decline of the economy and society.

The suggestion that "Creative Destruction" is something to be liked or not is a nonsense: it simply is....

 

[rgraham666]

As a matter of fact I have read Schumpeter. And I understand what he's saying, the new replaces the old.

Where we part company is whether society has any right to control this process or not. Schumpeter thinks not and and I think it does.

You also didn't read my original post carefully. I did not say Schumpeter believed destruction was a good thing. I said some of his followers misinterpret his work to give themselves license to be destructive. The same way some Christians misinterpret the Bible to shoot abortion doctors. Or some Muslims misinterpret the Quran to fly planes into buildings.

In my opinion, Marx and Schumpeter are cut from the same mold. Both believe that economics is the only important facet of society, they believe that the world they envisaged will come about and they believe it is useless to fight against it.

I disagree with both of them.

 

[Roxanne Appleby]

As a matter of fact I have read Schumpeter. And I understand what he's saying, the new replaces the old.

Where we part company is whether society has any right to control this process or not. Schumpeter thinks not and and I think it does.

You also didn't read my original post carefully. I did not say Schumpeter believed destruction was a good thing. I said some of his followers misinterpret his work to give themselves license to be destructive. The same way some Christians misinterpret the Bible to shoot abortion doctors. Or some Muslims misinterpret the Quran to fly planes into buildings.

In my opinion, Marx and Schumpeter are cut from the same mold. Both believe that economics is the only important facet of society, they believe that the world they envisaged will come about and they believe it is useless to fight against it.

I disagree with both of them.

Bill Gates = Abortion Doctor Murderer
Stephen Jobs = Abortion Doctor Murderer
Cyrus McCormick = Abortion Doctor Murderer
Henry Ford = Abortion Doctor Murderer
Thomas Edison = Abortion Doctor Murderer
Mr. Sears & Mr. Roebuck = Abortion Doctor Murderer
Sam Walton = Abortion Doctor Murderer

Thank goodness "society" has given to our wise leaders the power to stop the destruction these vandalous men may have caused had we not decided that "society" needs to "control this process."

All you buggy whip makers, sickle-wielders, typists, kerosene lamp makers, etc. - don't forget to send your campaign contributions to the planning board incumbents, because to protect your jobs we need to keep these decisions firmly within the political process. As you know every four years there's challengers who want to let things get out of control. (And if you don't pay up, we just might allow the innovation to be produced that costs you your job.)

Computers, motorcars, inexpensive merchandise, lamps that don't require whale oil - the nerve of some people! Where's their compassion?


~~~~

PS. How can you tell that an individual "cares about people?" Because they agree that society must "control this process!" And vice-versa, of course - this is how to tell who are the ones who don't "care about people."

 

[trysail]

I had Schumpeter (specifically, Capitalism, Socialism and Democracy) shoved down my throat as an undergraduate. Believe me, there was plenty of gagging. He is not easy to read.


Luddites, bureaucrats, utopian dreamers and malingerers will never like what he has to say (Luddites, bureaucrats and malingerers don't take risks*). Those who (truly) comprehend E.O. Wilson's "sociobiology" and Darwin's "natural selection by evolution" already understand the social necessity of risk taking (it is unavoidable). Those who do not will never understand. They are forever doomed to futile and stupid efforts at thwarting nature by means of politics.

In the end, economics and biology always trump politics.



____________________
*An occasional utopian dreamer (usually the trust fund variety) will accept risk— that willingness tends to correlate closely with the subsequent evaporation of said trust fund.

 

[Liar]

Bill Gates = Abortion Doctor Murderer
Stephen Jobs = Abortion Doctor Murderer
Cyrus McCormick = Abortion Doctor Murderer
Henry Ford = Abortion Doctor Murderer
Thomas Edison = Abortion Doctor Murderer
Mr. Sears & Mr. Roebuck = Abortion Doctor Murderer
Sam Walton = Abortion Doctor Murderer

Huh? I followed and understood this thread up until that.

 

[rgraham666]

Her fanaticism is of a different, better type than the the cases I cited. She's angry that I made such an unfair comparison.

 

[Roxanne Appleby]

Her fanaticism is of a different, better type than the the cases I cited. She's angry that I made such an unfair comparison.

Not angry at all. Delighted, actually - the comparison speaks volumes.

Trysail graciously and reasonably explains in plain English what I used sarcasm to illustrate.

 

[dr_mabeuse]

Let me know when you find some good Economic Porn.

 

[Roxanne Appleby]

Let me know when you find some good Economic Porn.

Actually, the porn industry is a wonderful model of creative destruction. In the beginning there was Playboy, which was then joined by a legion of sleazy competitors. Then came "adult bookstores," which sold printed photographic porn, 8 mm movies and pulp porn novels (those were better days commercially for porn writers, I suspect).

The "shelf space" devoted to the printed material plummeted in the 1980s with the arrival or porn video on VHS. More recently those tapes have been entirely supplanted by DVD, but with DVD came Netflix-type mail services (BushDVD, xrentdvd and more), which I imagine have put a real dent in the bottom line of the old brick-and-mortar establishments.

So now those places are evolving once again to become more boutique-like, catering to a more mixed audience, selling sexy lingerie, vibrators, a world of lube-jobs and whatever else they can think of. Some don't sell any porn and have names like "The Love Boutique;" customers are weighted toward suburban middle class women who want to be "naughty." Some of the old "adult bookstores" are deempasizing the dvds and catering to the same market.

The porn-by-mail dvd services are starting to feel the heat from on-line pay-per-view, and within a few years they too will probably become his-to-ry.

I think we erotica writers should demand regulations to "control this process;" all that innovation basically took away our bread-and-butter sales opportunity after the 1970s. Why do people really need video, anyway - smutty pulps were good enough for my grandaddy, and it should be good enough for you, damnit!

 

[ishtat]

An Economist for Dr Mabeuse

Let me know when you find some good Economic Porn.

Schumpeter was reputed to have announced himself at his first lecture at Harvard with the comment

" As a young man my ambition was to be the worlds greatest lover , the worlds greatest horseman and the worlds greatest economist.- Alas the cavalry has no place in the modern world"

He did in fact have a decent shot at all three. He was a very fine horseman partly because his step-father was a cavalry general.

As a young man in Vienna Austria he made strenuous efforts to fulfil his first ambition. Later he married an Englishwoman 12 years his senior. In his forties he married a woman half his age possibly bigamously. She romantically? died in childbirth and later he married an American woman who was substantially responsible for his legacy by collating much of his later work for posthumous publication.

I learned about Schumpeter as a naive undergraduate when I elected to complete one year of my course at a German University. We had to do a course outside of our main studies and idiotically I chose one on "The German Contribution to Economics" As a result I read a lot of Schumpeter and the whole of 'Kapital' in German! - and if Trysail thinks Schumpeter is tedious he should try reading Marx. I can tell anyone prepared to listen that I don't give a stuff about Marxism or Communism or any other 'ism but Marx is without peer the most boring man who ever put pen to paper. He is appalling.

I do seem to remember though that Schumpeter's main importance wasn't his development of the idea of 'Creative Destuction' which in any case he pinched from from that joyous little book "Krieg und Kapitalismus" Werner Sombart 1913.

Schumpeter's main contribution was that he taught economists to do sums.
His critique of Keynes was that he, Keynes would assume one or two variables then assume all other related factors in a problem were static and draw huge conclusions from this utterly false structure. Schumpeter said this was nonsense and all the variables had to be considered together. Unfortunately the mathematics for complex economic modelling were not really established until the 1970's which is largely why so much of Schumpeters reputation is only now reaching its height.

Economics really is the dismal science though Joseph Schumpeter was at least, unlike his contemporaries an interesting man.

 

[Roxanne Appleby]

Huh? I followed and understood this thread up until that.

An analogy was made suggesting some kind of equivalence between supporters of productivity-enhancing innovation and Christians who shoot abortion doctors; plus a condemnation of "fanatics" who oppose giving the government control over which innovations are allowed (so as to reduce the disruptions to particular interests that accrue from increases in productivity, notwithstanding gains to society at large). The list of names includes some of the all-time great producers of "disruptive" innovation.