Responding to “intelligent libertarianism”

a post in which eee_eff will not let certain oxymorons slide on by without notice…

Anytime I see the word “intelligent” close to the word “libertarian” in a recent (since 1993 or so) context, alarm bells start ringing.  So when I see this piece by Tyler Cowen (covering another piece by Matt Yglesias), I have to respond:

Matt Yglesias outlines an intelligent version of libertarianism

Picking up my previous request, Matt responds:

I think libertarianism is best understood as a kind of esoteric doctrine. There’s strong evidence to believe that people who overestimate their own efficacy in life wind up doing better than those with more accurate perceptions. It follows that it’s strongly desirable for society to be organized so as to bolster myths of meritocracy. This will lead to individual instances of injustice and to a lot of apparently preventable suffering, but over the long-term the aggregate impact of growth (which, of course, compounds) on human welfare will swamp this as long as we can maintain the spirit of capitalism.

A separate issue is the welfare of the world’s poorest. Progressive internationalists have this kind of dopey vision of trying to make trade and immigration policy win-win-win for everyone by using redistributive taxation to ensure that everyone shares in the benefits. That sounds nice, but it means that in addition to trying to conquer people’s racist and nationalistic instincts you’re also engaged in a fight to pry wealth out of the hands of the wealthy and powerful. As a political strategy, it doesn’t really make much sense. Why not simply join forces with the wealthy and powerful so as to create a political coalition that’s plausibly capable of overwhelming xenophobia and creating borders that are relatively open to the flow of goods and labor?

That is exactly the kind of response I was hoping for and both points make sense to me.  Here is a related Matt post on progressivism and America.

I would add that Matt’s description is consistent with my belief that the United States should be less progressive than the polities of north and western Europe.  For better or worse, most Europeans are more skeptical of claims of capitalist meritocracy and thus it is harder for them to realize gains by internalizing such an ethic.  Furthermore the non-progressive nature of many aspects of America — by encouraging economic dynamism — helps Europe to be as progressive as it is.  That’s an argument for American capitalism that both libertarians and progressives ought to feel slightly uncomfortable with, yet in my view it is compelling.

First, full disclosure:  I am an unrepentant Europhile, for which I will make no apologies.   Further, as an architect and an urbanist, my perspective is that we are uprooting our society from its traditional spatial and organizational roots, and this grand experiment needs to be called what it is: an experiment, with unknown results.  Libertarian proposals, were they enacted, would only speed this ongoing demolition of the public space.

I am also concerned that the libertarian/capitalist triumphalism stream of thought (cf Thomas Friedman) seems to distill everything down to a purely economic measure, which is exactly what those whom the libertarians worship but apparently very rarely ever read (e.g. Adam Smith, Schumpeter, von Hayek) warn against doing (here’s a post which includes a relevant quote of Schumpeter).   Of course, neither Tyler nor Yglesias stop to actually discuss the criteria or metrics they believe are important, so I’d invite them to clarify that point.

With the disclosure out of the way this is my reply:

Continue reading “Responding to “intelligent libertarianism””

Advertisements
Responding to “intelligent libertarianism”

The Self-Regulating Market requires state intervention

Tim Lee makes a couple of points about what he sees as the puzzling connections between free trade and protectionism, and he stumbles across the point I’d made earlier to one of Jerry Brito’s comments, (yes, the comment that Jerry can’t respond to, and therefore must censor) It’s a simple point that Karl Polanyi made in his excellent book The Great Transformation: that the self-regulating market requires state intervention, both for it’s creation and for its maintenance . So the creation of a self regulating market in copyrighted goods requires state intervention to create and maintain that market. But Tim, being a libertarian, can’t read or understand Polanyi, so he’s confused about why those who support free trade also support certain market interventions:

This is a fascinating question. One of the things I find really interesting about the 19th century political debate is that the opposing political coalitions were more sensibly aligned, perhaps because people had a slightly clearer sense of what was at stake. My impression (which may be wrong in its details) is that the free traders tended to be liberals and economic populists. They clearly understood that protectionism brought about a transfer of wealth from relatively poor consumers to relatively wealthy business interests. In the opposing coalition were a coalition of business interests and xenophobes making fundamentally mercantilist arguments about economic nationalism.

 

Karl Polanyi covers this period in his book The Great Transformation. His perspective is a little different.

First, Polanyi notes that those opposing the liberal agenda there were the defenders of the old order, ultimately derived from the feudal social structure, as well the working urban proletariat. Their interests never coincided and their visions of an alternative to the dominant liberal creed were so very different, it is not surprising that they never formed a united opposition. It is true that once the middle class realized that free trade meant cheaper food they were temporarily won over to its cause. But there were a few others who realized how disastrous free trade would be in the long run.

Second, Tim Lee, as all libertarians do, makes a whole series of informational exclusions about what comes along with liberalism. For example, it cannot be an accident that Great Britain, during the time of the ascendancy of liberal ideals, also maintained a very large colonial empire. Ultimately, adherence to the dogma of the self-regulating market requires state intervention to ensure that the prices of labor, land, and money are all controlled only by economic factors internal to that self-regulating market. When social, environmental, religious or national policies interfere with the operating of that self regulating market, state intervention is required. Case in point: US invasion of Iraq. When political ideals interfere with the functioning of the self-regulating market, state intervention is also called for by supporters of the market. Case in point: the DMCA. From this view, the fact that those who support the self-regulating market also support strong imposed patent, copyright and trademark laws is entirely consistent and unsurprising.

 

The bottom line is: you cannot separate the economic functioning of society from its broader social, political, environmental, national and social contexts, as liberals are wont to do. Human society just cannot be distilled into neatly separate fungible categories. They are all connected. Failure to come to grips with this reality is why libertarianism can only be maintained by making excluding whole categories of information.

Thus the following confusion on Tim’s part:

Today’s free trade debate is much weirder, because there are enough businesses who want to export things that significant parts of the business community are for freer trade. On the other hand, the liberals who fancy themselves defenders of relatively poor consumers find themselves in bed with predatory industries like sugar and stell that have been using trade barriers to gouge consumers. And the “trade” debate has increasingly come to be focused on issues that don’t actually have much to do with trade, whether it’s labor and environmental “standards,” copyright and patent requirements, working retraining programs, cross-border subsidies, etc.

Continue reading “The Self-Regulating Market requires state intervention”

The Self-Regulating Market requires state intervention

Convergence

Amartya Sen had observed that a Free Press is the very best weapon against hunger. There has never been, he asserts, a famine in a modern nation that has both a Free Press and multi-party democracy. I had wondered a while back (in this post: The Free Press, Famines, and Disease Outbreaks) whether a free press might also play a similar role in the prevention of disease outbreaks, especially after observing that China (not free press and and not multiparty democracy) kept SARS under wraps for quite a while, and who knows what else they might be hiding, too (Public Health Issue in China Glossed over (again)?)

It’s clear that I am not the only one thinking about the connection between a free press and disease prevention and their role in politics; both the current US and Chinese administrations have been doing quite a bit of thinking along those lines, too. Only their thinking isn’t the most constructive, they are both suppressing information about public health issues.

Continue reading “Convergence”

Convergence

Not your Father’s Thousand Points of Light

A Process that (very strangely) is under the radar of most right now is the expansion of the Not-for-Profit Sector into fields that were traditionally the exclusive reserve of the for profits. There was an interesting article in The McKinsey Quarterly* a while back that caught my attention with some facts about the Not-for-Profit sector:

1. The NFP sector as of 1997 was the third largest contributor to the GDP, contributing $349 billion to the U.S. economy, dwarfing the $85 billion contributed by the motor vehicle parts and manufacturing sector

2. The NFP/NGO sector employs 1 in 15 of employed Americans.

3. This sector has grown at an average annual rate of 5.1% from 1993 to 1998, beating GDP growth which was 3.1% annually

Continue reading “Not your Father’s Thousand Points of Light”

Not your Father’s Thousand Points of Light

The Free Press, Famines, and Disease Outbreaks

There are so many little nuggets in Amartya Sen’s book Development as Freedom that I really don’t know where to start, as there were so many little post-it notes stuck at passages that I thought were either entertaining or made excellent points, or contained interesting perspectives on points I’d thought about before that I stopped trying to keep track about halfway through the book. But certainly a key observation was that there has never been a famine in a functioning multiparty democracy which also had a working free press.

Continue reading “The Free Press, Famines, and Disease Outbreaks”

The Free Press, Famines, and Disease Outbreaks