DemocracyThe God That Failed Read Online Free PDF

meaning, under the dominant influence of the empiricist-positivist philosophy the term has acquired an altogether different meaning and reputation. According to the empiricist doctrine, normative questions are not "scientific" questions at all, and there exists no such thing as a priori theory. That pretty much rules out grand social theory from the outset as "unscientific." Accordingly, most of what passes nowadays as sociology is not only just plain false but also irrelevant and dull. In distinct contrast, the following studies are everything a good positivist claims one cannot and shall not be: interdisciplinary, theoretically oriented, and dealing with both positive-empirical and normative questions. I hope to demonstrate by example that this is the right approach as well as the more interesting one.

    Hans-Hermann Hoppe
    Las Vegas, Nevada
    September 2000

1
    On Time Preference, Government, and the Process of Decivilization
    Time Preference
    In acting, an actor invariably aims to substitute a more satisfactory for a less satisfactory state of affairs and thus demonstrates a preference for more rather than fewer goods. Moreover, he invariably considers when in the future his goals will be reached, i.e., the time necessary to accomplish them, as well as a good's duration of serviceability. Thus, he also demonstrates a universal preference for earlier over later goods, and for more over less durable ones. This is the phenomenon of time preference. 1
    Every actor requires some amount of time to attain his goal, and since man must always consume something and cannot entirely stop consuming while he is alive, time is always scarce. Thus, ceteris paribus, present or earlier goods are, and must invariably be, valued more highly than future or later ones. In fact, if man were not constrained by time preference and if the only constraint operating on him were that of preferring more over less, he would invariably choose those production processes which yielded the largest output per input, regardless of the length of time needed for these methods to bear fruit. He would always save and never consume. For instance, instead of making a fishing net first, Crusoe would have begun constructing a fishing trawler—as it is the economically most efficient method of catching fish. That no one, including Crusoe, can act in this way makes it evident that man cannot but "value fractions of time of the same length in a different way according as they are nearer or remoter from the instant of the actor's decision." "What restricts the amount of saving and investment is time preference." 2
    1 See on the following in particular Ludwig von Mises, Human Action: A Treatise on Economics, Scholar's Edition (Auburn, Ala.: Ludwig von Mises Institute, 1998), chaps. 18 and 19; also William Stanley Jevons, Theory of Political Economy (New York: Augustus M. Kelley, 1965); Eugen von Bohm-Bawerk, Capital and Interest, 3 vols. (South Holland, Ill.: Libertarian Press, 1959); Richard von Strigl, Capital and Produc tion (Auburn, Ala.: Ludwig von Mises Institute, 2001); Frank Fetter, Capital, Interest, and Rent (Kansas City: Sheed Andrews and McMeel, 1977); Murray N. Rothbard, Man, Economy, and State, 2 vols. (Los Angeles: Nash, 1970).

    Constrained by time preference, man will only exchange a present good for a future one if he anticipates thereby increasing his amount of future goods. The rate of time preference, which is (and can be) different from person to person and from one point in time to the next, but which can never be anything but positive for everyone, simultaneously determines the height of the premium which present goods command over future ones as well as the amount of savings and investment. The market rate of interest is the aggregate sum of all individual time-preference rates reflecting the social rate of time preference and equilibrating social savings (i.e., the supply of present goods offered for exchange against future goods) and social