Friday, January 28, 2005

Misunderestimating Don't-Call-Him-Fritz

Hayek that is. Not surprisingly we have a mis-use of knowledge in liberal economist bloggerdom:

The claim "I deserve my income," as applied to an individual's pretax income in free market economies, has considerable intuitive force.... But... Hayek explained why free market prices cannot, and should not, track claims of individual moral desert....

Those who actually know their Hayek see through this sophistry immediately, and ask: "Deserve my income, compared to whom?".

And to that, Hayek answers; we can't possibly come up with an answer that undermines the claim of the individual to his own income. Because, as humans, we must be ignorant of the myriad details that went into the earning of that income:

The peculiar character of the problem of a rational economic order is determined precisely by the fact that the knowledge of the circumstances of which we must make use never exists in concentrated or integrated form but solely as the dispersed bits of incomplete and frequently contradictory knowledge which all the separate individuals possess. The economic problem of society is thus not merely a problem of how to allocate "given" resources—if "given" is taken to mean given to a single mind which deliberately solves the problem set by these "data." It is rather a problem of how to secure the best use of resources known to any of the members of society, for ends whose relative importance only these individuals know. Or, to put it briefly, it is a problem of the utilization of knowledge which is not given to anyone in its totality.

The FLUBA Committee on Chutzpah, says: Not Even Close to a Cigar, Fellas.

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