C.W.

Okay, I am going to be one of the first to respond. Great! First, there is no Objectivist “physics”. Theories about the world are either true or false, based upon the evidence. Objectivism is concerned about the nature of evidence, thought, concept formation, theory formation. In the world, according to Objectivist metaphysics, there are things and their attributes (do not be confused by this manner of speaking, a thing is its attributes). Laws, relationships, theories, are conceptual devices derived by induction for the evidence of their senses for the purpose of human understanding of the real world. The laws, relationships, theories, are true to the extent that they accurately represent the interaction of things and their attributes. Life resulted because of the nature of the things that exist. The life that resulted would be different if the things and their attributes were different, if it could exist as a consequence of those things at all. This is the primacy of existence. Others may talk about the laws and that things are following the laws and if the laws of nature were different things would behave differently. This implicitly places the consciousness as the operative power in the universe. Laws are conceptual, not physical. Things exist, not laws. Laws are our means of understanding the nature of things. Things do not act according to laws but according to their nature. To put it another way, life, as we know it is the result of the way things are. If specific ratios of things actually contribute to the way life develops, then we are the natural consequence. The reasoning you site assumes that we are the correct result and tries to reason backward. This is consistent with a variation of the Aristotle’s concept of the Final Cause. But that is not a legitimate reasoning process, especially when applied to the world.

I also liked your blog. Looking forward to more. Both my girlfriend and I have lived in Colorado, where are you, generally?

Regarding your first point, I think you made a good representation of the difference between a person with professional musical training and a music lover. You want to see the nuts and bolts and can understand them and appreciate them. I, being only a high school clarinet player (which was long ago), can read the music (I do have several Dover scores) and enjoy seeing some of the internal supporting instrumental parts, but it really only helps me hear more in the music. That is good if I enjoy the music. I have met professional young musicians who recognized only the technical aspect of their craft. School didn't really teach them how to enjoy the music. They follow, I guess, Stravinsky, whom, I have heard, said that music did not have an emotional element. I will also own up to imprecision. When I said "modest" I was speaking within the parameters of my own personal view of the work. I do respect Beethoven and his creative and technical abilities and would not want to denigrate them. I have seen Fidelio and have one good recording. I am pleased with both. But in relation to other operas, to me it is a modest work. After reading of your regard for “Mir ist so wunderbar” I listened to a copy I own sung by Elisabeth Schwarzkopf, Kristen Flagstad, Josef Greindl, and Anton Dermota. I love ensembles. I am pleased that you mentioned your professional vocation. (If I could sing at all I would sing in the chorus of the Ninth with as equal a passion as I would in the Verdi Requiem. What about the tenor solo there?) Perhaps you could open a new thread and talk about your experiences, points you find interesting, and singers you admire.

Steve, you're right, I know. I was just playing to RS's fire analogy. I probably let that get out of hand.

Whose "actual point"? You responded to my comments and my point, not visa versa. And here is where we have a problem, there are two conflated, separate issues. To name first the one that you mostly address in your last post, kainscalia, is the more academic issue of Beethoven's person, i.e., his outlook, his attitude toward his music, and what he intended to communicate in his music. The other issue is how the listener responds to this music. In my last post, I did not in fact express how I respond to any composer other than to say that I didn't care for much of Beethoven and that I preferred Puccini, among others. You then went off on this totally irrelevant binge about Puccini not being all sweetness and light. Accused me of "dismissing" a piece of music, where I only said that I found that I didn't enjoy it when compared to others. You also threw in an appeal to authority to even things out. My comments in this thread have wholly concerned the point that what a person likes in music is totally personal. That's it. That is what Ayn Rand meant when she said that no one who didn't know her knew what her taste in music was. Taste. But you dismissed my comments because it didn't address what you wanted to talk about. It's okay to not be interested, but not to criticize me for things I didn't say. As for the academic issues, I have no knowledge and no interest. As an outsider, I can only say that you seem to be very upset about what you consider to be a dumb, unprofessional judgment. If someone makes an error, point it out clearly, and go on to something more interesting (sorry, gratuitous advice). From what I can tell, the rest of us are interested in what Ayn Rand meant when she said that she did not care for Beethoven.

Sorry, kainscalia. You didn't pay attention. I am now a strawman. Actually, much of what you said was not in refutation, but supported me. But, it doesn't matter. Apparently you are on a roll, and in spite of what is said, you will continue.

I am sure that we can have a wonderful debate about whose situation is more dire. Personally, I think that the upcoming Social Security and Medicare mess as laid out by John Lewis is more dire than the trade deficit. Obama is just going to bring it closer. (Schiff hasn't mentioned it in anything that I have read.) That will be an entire continent on fire. With that in mind, Japan is at that point already. In spite of your admiration for Japan because of its savings rate, lower government debt (since they have 100 year mortgages, I'm not sure that their private debt is lower), its aging, shrinking population is dependent upon its version of social security pensions. (I don’t want to leave out credit: Japan had a discount rate of less than 1% for years. That was cheap credit!) Its government will be bankrupt in just a few years. From what I can tell, the Japanese are paying less attention to it than we are our own upcoming mess. True, that will only be a relative small island on fire. Really, it isn't debt so much as obligations (oh yes, Schiff has mentioned SS and Medicare unfunded obligations, but that hardly indicates how big a mess that will be). Japan's governmental obligations proportionally make ours look small. Next after Japan comes Italy and then France. They are only the size of modest U.S. states, so the fires will still be relatively small. Regarding costs, I was, of course, speaking relatively (I was speaking of costs, not prices). All things being equal, an area with a higher standard of living will have higher labor costs than an area with a lower standard of living. We have recent experience with that in the U.S. when manufactures moved plants from the North to the South, where the labor costs were less. Yes, the labor laws were also better, but there was a distinct difference in the standard of living, which has since narrowed. Just for fun, take a look at my Flight of Fancy. It won't hurt, I promise.

Sorry, spaceplayer, I should have checked closer.

kainscalia, I am familiar with the Beethoven pieces that you have listed in earlier posts. A couple I like considerably, some I do not. I love Beethoven’s Ninth, think that Fidelio is at best modest, with a couple good tunes (I have over 150 complete opera recordings!), enjoy his Fantasia, and think Wellington’s Victory is a well intentioned mish-mash. I think that I have all of Beethoven’s songs. I have perhaps 600 to 700 songs total, including all of Schubert’s. In spite of that, I have to admit that I have some trouble listening to the songs. But, I would put Beethoven’s near the end of my list of preferences, along with Cui and Wolf. Against all of them, I often prefer Cole Porter. I do not hear or experience what you do. As you can see, I love opera and prefer Verdi and Puccini. Puccini can reach deep inside of me and show me the wonder of life. I don’t really care how he lived. I appreciate that you have an admiration for the life of Beethoven. I suspect that your interest in his life came from your enjoyment of his music. Would you might feel differently if that life was lived by some whose music you didn’t like? Conversely, if Beethoven had lived a thoroughly mundane life, the music would still be the same music (I realize that there was a connection between the life and the music). All of which is beside the point. The point is that the music speaks to you more than it speaks to me. That is perfectly okay. That someone feels that a composer’s music is depressive has no meaning for you or for me or anyone. Art will impact different people differently, even good people. It may or may not tell you anything about a person. My wonderful girlfriend likes music that drives me to distraction, and vise versa. That another blogger felt that a written statement made at a young age was an indication of the life lived is still beside the point. He doesn’t like the music. You may feel he is wrong, but what he finds in the music is what he finds. Your arguments do not touch that point. Beethoven does not need defense. His music speaks for itself. It speaks to each of us. What we hear is our own, our own values, our own personality, our own background, our own self. The best of us do not like the same music. Even with an objective standard of music, we will still like different music. Some rational people will even like music that does not meet the standard. There is an objective standard for art, for example, but many of us like “bad” art for our own reasons. It’s okay.

It speaks no more volumes than it did when Japan was doing the same thing 50 years ago. Now China is doing it to Japan. If Africa were to ever brake out of its insanity, it would do it to China, because China's standard of living may continue to rise and its costs increase. Incidentally, since the Euro block also has a big deficit with China and China can also send this child's toy to them undercutting the European producers, are the Europeans in the same boat as the U.S.? I didn't say that we weren't "bound" by our situation. I said very plainly that we were. I repeat, I said that I didn't disagree with khaight. I said nothing to imply that I thought things were wonderful. Where did this "but" come from? You seem to be pretending that I said something entirely different. Are you saying that no other country is "bound" by the irrationality in their own country? For example, while the Euro is comparably stable, the European central bank is far more political, and its labor laws are far worse than ours. And who wants to be a citizen controlled by the Chinese Communist Central Committee? And what do you mean by "bound". How is that suppose to counter what I said? Your "bound" in no way contravenes my point that people make the best choice they can in their situation. Or that international markets are some protection.

Brian, I don't disagree with your fundamental point. More broadly, every locale or geopolitical entity will have its own issues, and in your comment, drawbacks. But individuals in each country, given what they can do legally and financially, will make the best choice available to them within the worldwide economy. There is no nation in the world today that doesn't have some governmental interference that undercuts their ability to produce and trade in a consistently rational manor. One of the good things about international markets, e.g., commodities and the Internet, is that they are a protection from some of the irrationality at home.

I was in the audience at one of her Ford Hall Forum speeches when a young woman asked Ayn Rand if she liked Beethoven. This was the first time Beethoven was mentioned publicly by Ayn Rand. What I remember clearly is that she said that she did not like his music. She said that she realized his importance to the development of music, which she said in a fairly positive way. She said nothing about the questioner's obvious like of his music or implied something wrong with the questioner. She merely and only stated her preference. Finally, she said that she wished people would not send her recordings. She said that no one who didn't know her personally could know her taste in music. She clearly did not think that her taste had any implication for anyone besides herself. Since then I have had a couple occasions to talk to prominent Objectivists, people who were connected with ARI, about music. One really liked Viennese Operetta and disliked Baroque. Another said that they saw no reason to give up the music they liked when younger, which in this case was Blues. In neither case did we talk about any other music. Neither of these people gave the slightest impression that I should like or dislike according to their tastes. Regarding Beethoven, I have heard from other Objectivists with backgrounds in music that they considered Beethoven in general to have a depressive tendency (my words). I am certain that they didn't mean that every piece was so, but that it was a general tendency. Personally, years ago I bought the DG Time-Life collection of Beethoven, something like 60 LPs. I can't say that I listened to all of it, but I know a lot of his music. There are some pieces that I like a lot. There is a great deal that I don't. Of the things that I like, only two or three do I like enough to listen to very often, given that I have a lot of options. This thread is kind of disappointing. There are overheated defenses. Some have called people names who opposed them and become indignant when their opponent didn't want to put up with it. Take a deep breath.

I would like to know where you get these ideas. I mean, I really would like to know their source. Productive individuals have savings, yes. But the savings are not hoarded. It means nothing to save if the savings are not invested, although having reserves is a good idea, too, the reserves are a constant, and thus not significant. When the savings are invested it means that someone is using those savings for productive activity. Savings are like reinvested profits. For the economy as a whole, in the longer term, you expect savings and investment to balance out. But it is all consumed. The ultimate and only expense in all economic activity is work, including the capitalist, i.e., brain work. Further, we are in a worldwide economy. Ultimately, dividing the U.S. off from the world makes no more sense than dividing California off from the U.S. You really can't consider us in isolation. That is one reason why the service vs. goods aregument doesn't work. But back to the trade deficit. The only reason we have a trade deficit is because foreigners are keeping dollars. That's it. If they were spending the dollars they received when the got them we would have no trade deficit. It is not an issue of our productiveness. They want, based on their own judgment, to keep the dollars. There are so many dollars because the Fed keeps making them, massively. It is like the real estate bubble. The Fed keep making dollars and the mortgage brokers keep loaning them out. International trade is based upon credit. Fed kept (keeps) expanding credit, dollars got shipped overseas. Schiff is correct that the "reserve" status of the dollar is a major reason we could export our inflation. We have ourselves to blame. But it is inflation that drove the massive amounts of money that went overseas. If foreigners had spent that money as they got it, the dollar would have been dropping for many more years, which would have been better for us. It is not an issue of services vs. "goods". Productive vs. non-productive. It is what they did with our inflated dollars. And, yes, they are changing their minds, somewhat. Within a gold standard, there wouldn't be a deficit or surplus between countries, productive or otherwise. There are natural, economic activities within the international arena to automatically bring things into balance. Typically, the reasons for imbalances are financial, not the production of goods. Or maybe changes in the relative value of commodities or goods as the technological foundation of the world economy changes. But, surplus vs. deficit went out with the death of Mercantilism.

Ayn Rand once had an office in the Empire State Building. It was once the center of rationality in the world. What a come down.

Andrew, The first sentence is merely a declaration. Is the second sentence there to support the first? It doen't, you changed for the economy to the standing of the currency internationally. Nor do I think that the second sentence is entirely true, althought I do realize there is importance to being a "reserve currency". "Paper", I take it means exporting dollars. Our exports last year were $1.8 T, our deficit was $600 B. Our paper was 25%. That is very bad, but not death, necessarily. I have looked back over the posts at your comments before regarding our "specialization". Your list of goods is always about two or three, and the same ones. There are actually thousands, and yes, many of them we are the best. But, you know, even if we are the best, we may be too expensive. To be successful in selling your product, it must also be affordable to your market. We still are, in many areas. You must open up and look around. Get away from your compurter and the liberals on TV and look. Americans are very creative, original, and can think of many things to do besides TVs and cars. Again, just because you can't think of them, doesn't mean the things aren't there. So, I don't "know this" because it is not true. Yes, $2 T dollar deficits are going to be very bad for us, and yes, in one form or another, lots of inflation, probably lots of price inflatin, too. Obama is both the best and worst thing to happen in a long time. He is good for the sales of Atlas you know. However, I don't see how your last two sentences have anything to do with Schiff's claims in Crash Proof. And, no, what you said does not add up to a massive depression.

Bruce, Basically, I think that your analysis here is correct. Although the Fed does not actually need any additional government bonds in the system to increase the money supply. You are also right on in noting that it is through loans that the Fed expands the money supply. You might look at the role of the "reserves" in the bank credit expansion, since it allows the Fed to have a 1 to 10 impact via the "reserves". The "reserves" in the "Federal Reserve System" is the key to the massive power the Fed has. I think that your last couple of sentences are really good. Keep in mind that international trade is all done on credit. It is our credit expansion that enables us to finance the international trade deficit. It is the direct export of our inflation that we have seen for nearly three decades. Yet, I am not sure how your excellent analysis meet my objection that our supposed lack of manufacturing causes our trade deficit. Nor do I see how it means that the United States does not product wealth. The Fed can make it more difficult, but that has nothing to do with services vs. manufacturing.

SoftwareNerd, I agree with you. You add in a little freedom, and our prospects can change quickly. I was amazed that Schiff would say what he did. I don't try to figure out what someone means, I take them at what they actually say. Of course, I personally often have to back track, cuz there are gaps between the brain and fingers. But I don't have a book on the market that has gone through editors, etc.

I'll let him tell you, from Crash Proof (p. 38). So, because computers turned out, according to his sources, to be not as productive as promised, there was no increase in productivity. I wonder how he thinks increases in productivity occurred before computers? I mean, he seems to think that only computers could have created more productivity. Or, the productivity increase during the 90's was measured. Schiff has now declared that since computers weren't as important as first thought, the measured increase in productivity doesn't exist. I don't think that this is the only example of Schiff's thinking like this. Another important point, he says, "...why, if it is true that we are more productive than our trading partners, our trade deficit gets bigger, not smaller." I do not understand why he thinks there is a direct connection. There are echoes of this thinking elsewhere in his book and in earlier posts from his supporters. He sees our trade deficit as a result of our needing manufactured goods (no one offers any actual support for this contention). All we really see is dollars going overseas that don't come back, well, at least until recently. We only have to look to the Fed to see the reason. Imports are financed by bank loans. The Fed has expanded bank loans like crazy for decades. We have been exporting our inflation.

Phil, this is an excellent point. Unfortunately, Schiff claims that U.S. increasing productivity is a myth. Sorry. See “The Productivity Myth” (p. 38) in Crash Proof

SoftwareNerd, Schiff says that it is irreversible: “[The U.S.] is fighting a losing battle against trade and financial imbalance that are caused by dislocations too fundamental to reverse.” (p. 1, Crash Proof) A collapse is unavoidable. We are doomed.

The example fails. It merely restates what he has already claimed without support. It merely insults. I do not know why Schiff offers this “example”. Have you shown it to any Americans and told them that you think that way about them? This is not a very smart thing to do. Now you’re saying that his attitude toward the “every-day person” is insulting. That he can’t really explain himself. That the “every-day person” isn’t smart enough to understand the real world, especially today’s mess. Not smart.

Bruce, I know that the first part of your statement is what Schiff says, but I cannot see how that works. Foreign purchases of our government debt do finance government activities, just as domestic purchases do, but how it then connects to services, I don't see. Our services exports are not a large part of our exports anyway, so it his argument is way off. The last sentence about wealth and production is unsupported. Evidence, please. This isn’t supported either. In addition, the sentences are non sequiturs. The first sentence is not what you mean, you meant to say that people need to produce goods. That is a point in dispute, the U.S. does produce. Go look at Thomas Register. Look at actual production figures.

Andrew, This statement just seems to be an unsupported claim. Besides, Schiff does not claim that we didn't have a manufacturing base before we began to "focus" on a service sector. He claims that it went away, and the service sector by itself is not sufficient. Some of the responders on this forum have disputed Schiff's claim that we have no manufactuing capacity to speak of. We do. I think that the trade figures listed in earlier posts support our position. Plus consider that only about 20% of our economic activity is in imports. Such a small percentage would at least suggest that we do a lot of manufacturing, in spite of Schiff’s claims. Please give us Schiff's supporting evidence for his postitions.

Do you consider this “example” is representative of yourself? Does it accurately reflect your friends or relatives? Does anyone you respect or admire fit this example? Aside from some government employees, have you seen anyone who fits into this example. Does any working person, including housewifes fit? What do you think that this proves or illustrates? If Schiff does run for office, his opponent would not have to do anything other than take this “example” to every working person of any talent or capacity, saying that this is what Schiff thinks of Americans, and he would win hands down. I think that if Ayn Rand were to have seen this she would have been outraged. I would expect this “example” from one of our enemies, say Castro. It is insulting. I am insulted. It does not offer any argument or justification to think that the U.S. is in serious trouble. (We are, but the Current Account Balance isn’t the reasons. It is a problem.) It certainly doesn’t offer any reason to think that the crash of the dollar won’t be a crash of the world system.

Bruce, My source for this discussion of Peter Schiff is his book, Crash Proof. It is his big, recent public statement, available in bookstores and libraries around the country. I will soon examine his revised book. Schiff does not say that the dollar is worthless directly. I think that I actually picked up this phrase from Andrew in earlier posts. Schiff says that the U.S. does not produce anything worth buying, as you agree. He says that we cannot pay our debts. If you don’t produce and can’t pay your bills, your currency is worthless. We will experience a “monetary collapse” (p. 2). “The dollar is going to collapse”. (italics in original, p. 6) That is why Schiff says it will crash, and “our purchasing power will be gone”. Examples of his statements about the U.S: "It’s [the U.S.] analogous to a family…whose breadwinners have lost their jobs. To keep up appearances and maintain the same lifestyle, the family resorts to borrowing and goes deeper and deeper into debt.” (p.2) The U.S. has no job, i.e., we do not manufacture anything. “Americans are not saving and producing but are borrowing and consuming” (italics in original, p. 4). This is presented as a dichotomy for some reason. If you are only doing the latter two, then there could be a problem, but generally, all four are okay. The best example from Schiff is the parable is you have quoted. The “American” in the story produces nothing, gives out paper worth nothing. This is Schiff’s view of the American economy. I have some strong things to say about this parable, which I shall save for later. In Crash Proof, the only reason that I saw Schiff offer as to why foreigners were accepting dollars was that the U.S. was pulling the wool over their eyes. There was some allusion to China and its current mercantile policy, but that only pertains to China. I saw no other explanation. My two explanations of why foreigners accept and hold dollars are that the dollar is the only international currency which is a value, and that holding the dollar is often better than holding the domestic currency, are both inconsistent with Schiff’s claims that the dollar offers no value. The dollar debts cannot be paid and there is nothing produced worth buying and, consequently, that it is really one of least valuable currencies on the planet. His advise is to divest yourself of dollars. Schiff says hold gold, hold foreign currencies, hold foreign stock, anything but dollars. I suppose that Schiff might say that there are many currencies that are worse off than the dollar. Perhaps his comments about the rest of the world are meant to refer only to the “Asians”. From his book, it isn’t clear. Schiff rarely says that it will decline over time. He says collapse. He says crash. He says “hyperinflation” (italics in original on p. 6; p. 9). A collapse in the dollar and thus the U.S. economy will hit other countries very hard. By devaluing the dollar to near zero their reserves will be wiped out. The results will be similar to what happened to banks when their reserves were wiped out by securitized mortgage bonds written on sub-prime criteria. The world financial system is based upon the dollar. You see, you consider the U.S. to be a worthless place. Sir, you are wrong. You must realize that the U.S. is actually a country that depends upon international trade to a much smaller amount than any other industrialized country. The trade deficit is only about 5% or our total economy. Trade is about 25%. So we export about only 20% of our production. We aren’t getting all the good stuff from overseas. Go to the library and ask to look at the current edition of the Thomas Register, scan it, then look for your geographic area, and go visit those companies. Learn something about America. Okay, some specifics: The U.S. debt owned by foreigners that has put us into trouble is federal government debt. Of our federal debt, in mid-2008, foreigners held about $2.6 T, or about 24%, the Fed about $600 B, of a total federal debt of about $10.3 T, which means that U.S. citizens, business, and banks held $7 T. Foreigners are said to be financing our debt only because the interest rate would need to be a lot higher to attract the money necessary within the country. (I found my information by Googling. It conflicts with Sniff’s chart on p. 6 which is apparently 2006 information.) The U.S. is a net debtor, meaning that we owe more than we are owed. Foreigners also borrow from us. If you look at non-government borrowing, the U.S. is a huge net lender. Incidently, through most of the 19C we were net borrowers in the private sector. The reason it is bad today is again, that it is government debt, not productive debt.