Video: The Conversation

From the Foundation for Harmony and Prosperity (hat tip EPJ)

Amidst Hyperinflation, Venezuelan Government Decrees a ‘Happiness’ Ministry

In Venezuela, “happiness” will now be imposed by fiat.

The Venezuelan government has announced a new bureaucracy called the Vice Ministry of Supreme Social Happiness

From Telegraph/AP

A new Vice Ministry of Supreme Social Happiness has been created by Nicolas Maduro, the Venezuelan president, in an attempt to coordinate all the "mission" programmes created by Hugo Chavez to alleviate poverty.

"I have decided to create this Vice ministry and I have given it this name to honour Chávez and Bolívar," Mr Maduro announced on Thursday in a televised speech made from the presidential palace. He said that the Vice ministry aimed to take care of the most "sublime, vulnerable and delicate, to those who are most loved by anyone who calls themselves a revolutionary, a Christian and Chavista."

Oil-rich Venezuela is chronically short of basic goods and medical supplies. Annual inflation is running officially at near 50 per cent and the US dollar now fetches more than seven times the official rate on the black market.

The creation of the ministry sparked widespread mirth and mocking in the streets and on social media.

In a state of hunger, shortages and hyperinflation, the Venezuelan government will force their citizenry to be “happy”. Maybe frowning, sulking or crying in public or in households will be prohibited.

In reality, the only entities who will be "happy" are the political leadership and the bureaucracy who will be spending more of other people money, and who will virtually dictate on lives of their constituencies to conform with the conceit of their leaders. “Be happy! Or else….”

Well in my view this fits Australia's Walk Free Foundation definition of “modern day slavery” which according to the Los Angeles Times, takes many forms, and is known by many names. Whether it is called human trafficking, forced labor, slavery or slavery-like practices … victims of modern slavery have their freedom denied, and are used and controlled and exploited by another person for profit, sex or the thrill of domination." (bold mine)

Happiness can never be imposed. Happiness is subjective and comes from the individual's inner self. 

As the great Austrian economist Ludwig von Mises explained, (Liberalism p.46)  [bold mine]

Whoever wants to see the world governed according to his own ideas must strive for dominion over men's minds. It is impossible, in the long run, to subject men against their will to a regime that they reject. Whoever tries to do so by force will ultimately come to grief, and the struggles provoked by his attempt will do more harm than the worst government based on the consent of the governed could ever do. Men cannot be made happy against their will

Happiness as a social policy is an example of the height of statist lunacy.

But as Mises warned Venezuela’s Happiness Ministry will eventually "grieve" or have its pretentiousness exposed.

Quote of the Day: The Spurious Idea of Measuring Value

The basis of modern economics is the cognition that it is precisely the disparity in the value attached to the objects exchanged that results in their being exchanged. People buy and sell only because they appraise the things given up less than those received. Thus the notion of a measurement of value is vain. An act of exchange is neither preceded nor accompanied by any process which could be called a measuring of value. An individual may attach the same value to two things; but then no exchange can result.

This is from the great Ludwig von Mises from his magnum opus Human Action Chapter XI Section 2 p.204. (hat tip Mises Blog)

This is in accord to yesterday’s quote of the day where Professor Deirdre McCloskey bashed the notion of using mathematical formalism to measure “happiness”.

Quote of the Day: The Folly of Measuring Happiness

What the economists could measure pretty easily, though, was the money you have for buying sandwiches or paying the rent. Income is not your happiness and doubling it will not make you twice as happy—but it does measure your capability for action.

That’s from a lengthy critique, by Professor and author Deirdre McCloskey, on experts who fallaciously attempt to “engineer a happy society”

Poor and Middle Income Countries are ‘Happier’?

Based on self-reported happiness, poor to middle income countries have reportedly been happier than their rich counterparts

So says the Economist,

DESPITE the economic gloom, the world is happier than it was before the financial crisis set in (according to a recent poll from Ipsos which surveyed 19,000 adults in 24 countries). 77% of respondents describe themselves as "happy", three percentage points higher than in 2007. Those countries who report themselves as being the happiest tend to be in poor and middle-income countries, while the gloomiest are in rich countries (the figures for Italy and Spain were 13% and 11%).

Reasons? Again from the Economist,

Two conclusions emerge. Large, fast-growing emerging markets do not share rich industrialised countries’ pessimism. The already large “very happy” cohort rose 16 points in Turkey, ten points in Mexico and five points in India. Even rich-country pessimism is uneven. The share of “very happy” people rose six points in—of all places—Japan, defying tsunami and nuclear accidents. But growth amid global misery does not explain everything: the biggest falls in happiness also occurred in large emerging markets, in Indonesia, Brazil and—a perennial misery guts—Russia.

The second conclusion challenges the received notions of mankind’s moods. A tenet of political science is that happiness levels rise with wealth and then plateau, usually when a country’s national income per head reaches around $25,000 a year. “The richer a country gets,” argued Richard Wilkinson and Kate Pickett in “The Spirit Level”, an influential book of 2009, “the less getting still richer adds to the population’s happiness.” Many on the left have concluded that pursuing further economic growth is pointless. Even right-wing politicians such as Britain’s prime minister, David Cameron, and the French president, Nicolas Sarkozy, have set up projects to study “gross national happiness”.

I am tempted to say that polls like this seem to justify the political economy of fascism—since people are happier by being poor, then maintain their happiness by continued immersion to poverty. This by handing over economic opportunities to politicians and their cronies through “special interest group captured” political institutions.

Happiness is subjective or signifies an individual's state of mind or represent personal value scales expressed through expectations.

If the above account has some grain of truth in it, then I’d say that reference point matters: Poorer nations may have relatively lower expectations than those of rich economies. And trajectories of economic growth have been changing the underlying dynamics of expectations

With globalization (measured by trade volume and Industrial Production) at record highs (chart from Professor Mark Perry) economic opportunities have been brightening up for emerging markets compared to debt plagued developed economies.

In other words, optimism, for people who have been jaded or inured to poverty, have likely been derivative from increasing trade opportunities (through liberalization or more economic freedom) that has rewarded their drudgery.

Economic growth favors emerging markets; chart from another 2009 Economist article

Whereas people used or conditioned to living lavish lifestyles funded by intractable debt will have to face the realities of rebalancing their finances. So again, changes in expectations from base points seem to be shaped by the economic developments

There is another aspect: the welfare state. People in rich countries, many of whom are dependent on the welfare state may have seen a reduction in the essence of personal values; particularly family, responsibility, and value of work.

As economist Vedran Vuk writes at the Mises.org,

The agenda of the state is to break up the family. The more you depend on the state, the more you justify its existence, and the larger it grows. The idea that people can provide things for themselves either individually or through the family frightens the state. It delegitimizes its role. The role of the family is dangerous to its survival.

In contrast, the rewards in economic growth have not only been benefiting one’s material welfare, but importantly are magnified through personal values (again family, responsibility and work ethics) in lesser welfare dependent economies.