Re: AW: National Socio-Economic Security Need for Encryption Technology

[tcmay@got.net (Timothy C. May)]

At 3:35 AM 8/13/96, Perry E. Metzger wrote:
>Bart Croughs writes:
>> I would be proud if I had discovered this axiom, but alas, I haven't.
>> It's an axiom that is generally accepted among austrian economists
>> (Rothbard, Hazlitt, etc). I don't know who actually discovered it.
>
>The truly hysterical part is that Tim and I are both (from what I can
>tell) Austrians.

Indeed. While Perry and I disagree on some things, the relevance of the
Austrian School of Economics, and its University of Chicago satellite
campus, is not one of them.

If Croughs stays on this list long enough, he will surely see this. (And
find plenty of references to Hayek, Menger, Friedman, etc., in the
archives.)

The problem with the "Croughs Axiom" is not that there is not a _general_
correlation between average national wages and average national capital
investment--there is. A scatter plot of wages vs. capital investment for
the 200 or so nations would almost certainly show that the Ivory Coast has
low per capita wages and low per capita wages, Sweden has both higher wages
and higher capital investment per capita,  and so on. Correlation, of
course, is not causation.

No, the problem was that Croughs invoked this general _correlation_ (which
can arise for various reasons) to support his mercantilist protectionist
ideas. (He also didn't say he was talking of nations, which is why some of
us found the examples we did, e.g., MacDonald's vs. law firms, which have
the opposite correlation he described.)

And the cloud of ideas connected with somehow forcing capital investment to
remain in the U.S....well, the best way to do this is to alter the tax laws
so that America (for example) becomes a magnet for investment. (If one is
looking to help America, that is.)

In any case, the original notion, of somehow using cryptography policy to
support U.S. interests....well, I rather doubt that Menger, Von Mises,
Hayek, Hazlitt, or any of the others connected with the Austrian School
would buy Crough's protectionist arguments.

And I certainly know that jingoistic appeals to "America First!" are
inconsistent with the sentiments of many or even most on this list.

--Tim May

Boycott "Big Brother Inside" software!
We got computers, we're tapping phone lines, we know that that ain't allowed.
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Timothy C. May              | Crypto Anarchy: encryption, digital money,
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