Tim Lee on Patriotism

Tim Lee's response to Tim Sandefur (and therefore to Ilya Shapiro) is spot on. Do read the whole thing.
I especially liked this:

Loving your country because it embodies specific political ideals isn’t patriotism, it’s called having a political philosophy. Patriotism is loving your country because it’s your country, regardless of what political ideals it may or may not embody. Most people would not switch allegiances if they became convinced that another country better embodied their political ideals.

It is not obvious to me that other countries don't better embody the ideals I most care about. Because I do have a particularist attachment to America, I'm quite glad that its not obvious. I do love America (in much the same way I love Iowa and the Cato Institute). But I love liberty, prosperity, and human flourishing first. If another society does better in securing these things, it's a better society, and I would indeed switch my allegiances if it came down to it. That is, I have a political philosophy and I seriously.
Tim's conclusion is especially good:

It’s important to understand the social and psychological processes that lead people to be biased in favor of their own groups in part because it will make us more effective at persuading others to adopt our ideals. Our goal in Iran, for example, should not be to make Iranians patriotic Americans—an impossible task—but to make them (classical) liberals. The way to do that is to convince them that it’s possible—maybe even natural—to view liberalism and Iranian patriotism as compatible. This is one of the reasons I’m a big fan of Tom Palmer’s work to convince people around the world that liberty is not an American invention but the common heritage of mankind. Tom goes out of his way to find home-grown examples of liberty in the various countries where he works—writings of ancient Chinese philosophers in China, Sumerian writings in the Middle East, and so forth. We’re never going to turn Iranians or Chinese into American patriots. But we may be able to help them cultivate a more liberal conception of what it means to be an Iranian or a Chinese patriot.

That's exactly right. If you really care about liberty, you've got to ease up on the Americanism.

Author: Will Wilkinson

Vice President for Research at the Niskanen Center

12 thoughts

  1. What is the mystery here? If you’ll pardon my complete and utter lack of, cough, evidence, I’ve got a perfectly robust theory about the cause of micro-fear (though it’s unclear to me why we ought to be interested in lifetime incomes when a modest revision in next year’s income can prompt drastic revisions in behavior).
    If companies and institutions are hiring – better yet, if they can hardly fill positions and have to compete hard for employees, economic outlooks brighten (since inflation rarely factors in among the broad population’s assessment).
    If companies and institutions are firing and slowing their pace of investment, economic outlooks darken – especially if you were among the recently fired.
    The questions about media manipulation are interesting and apt, if a bit diabolical. On the other hand, our mass media is particularly terrible about contextualizing anything, and it would certainly be welcome if these economic events could be properly historicized.

  2. First off, what Vangel wrote- cubed. It seems to me too that the Austrian School more or less predicted this.
    The last econtalk podcast is with Russ Roberts and Robin Hanson on just this topic. They seem to pretty much acknoweldge that when it comes to macroeconomics most economists are basically just loyal to their side, be it free market or interventionist.

  3. The Keynesian concept of “propensity to spend”, the percentage of income spent rather than saved or invested, is a useful measurement and can be measured under a variety of conditions. So it isn’t necessary to create psychological explanations for whether there are increases in propensity to spend based on certain conditions. Just create certain conditions and see whether propensity to spend increases or not.
    I think the psychological silliness comes in because people want to explain *why* certain actions affect propensity to spend, and then generalize that to new situations that we have no data for. The problem is that the data often doesn’t support their hand-waving and generalizations. But once you get one or two generations removed from the originator of the generalization, people forget exactly how, and why, the generalization was formulated in the first place, and treat the generalization as some law of nature rather than as some hypothesis to explain data, a hypothesis which must be tested against further data in order to ensure its applicability.
    And thus you have idiots hand-waving about how the President making a statement about the economy can suddenly make insolvent consumers solvent and capable of buying again, or some such silliness.

  4. Your description could apply to any number of professions. Economics is no different than investing, medicine, law, etc in that our theories merely guide us, but interpretation can change everything. Further, it’s a “practice” not a profession, so it’s constantly evolving and perhaps never perfect. Many people have lambasted economists in the past year or so because some of our forecasts have been off in this crisis. People are questioning economists because we couldn’t accurately predict this crisis, but what people don’t understand is that economists don’t deal in certainties and we don’t make predictions. We deal in probabilities and as such, the results can change; they are fluid. So, it’s easy to say economists can’t agree on anything, but it’s the same as saying lawyers can’t agree on everything or asking why doctors don’t always prescribe the same diagnostic for a certain illness.

  5. My own personal take is that the truth of the matter is staring everyone in the face, but only the Austro-libertarians are enthusiastic about it because it confirms their critique of Keynesian/neo-liberal “scientistic” economic policy. The embarrassing incoherence also has much to do with what different economists wants to see accomplished. As someone else said, they mostly stick with those that brung them.
    Those who favor liquidation probably envision a systemic cleansing and return to savings/production economy at a lower standard of living after the world gives us our tough medicine by abandoning the dollar. Those in favor of bailouts and large govt. spending initiatives self-evidently want to preserve the status quo on the backs of future generations. It’s obvious they’re just trying to kick the can down the road for another decade or so.
    The Austrians are gloating over the implications of the collapse because it’s intellectual vindication for them and they assume that they will inherit mainstream credibility by default once this latest round of Keynesianism backfires eventually. They’re wrong, of course; we’ll have totalitarian planning and a Soviet-style collapse long before the winds shift to the point where radical liberalization becomes politically acceptable.

  6. Good job of declaring that the emperor is naked! This is not a new problem for economics. I re-read over the weekend O’Driscoll’s “Economics as a Coordination Problem: The Contributions of Friedrich A. Hayek”, available online at the Library of Economics and Liberty. It’s a short book. O’Driscoll wrote in the late 1970’s:
    “The crises are being proclaimed everywhere by pundits and serious economists alike. When Sir John Hicks lends support to this chorus of woes in the very title of his recent book,The Crisis in Keynesian Economics, then truly something is amiss with economics…”
    “None of the above is intended to deny that there is a general crisis situation in economic theory, of which various particular crises, such as that in Keynesian economics, are but manifestations of a more general intellectual malaise. Nor am I entirely out of sympathy with particular “radical” criticisms of orthodox models. I am simply arguing that the crisis has simply not been diagnosed, though its symptoms are now well known. They have been observed in numerous recent works, including Hicks’s and in previous chapters of this book. But no satisfactory diagnosis having been made, it is no wonder that the putative cures are misconceived….”
    “My argument, then, is that the various crises in economics are manifestations of inconsistencies in the neoclassical research program. These inconsistencies are present because of the curious admixture of Ricardianism and neoclassicism present in the modern research program. The inconsistencies were never resolved, though their resolution was in sight in the thirties when it was aborted by the Keynesian revolution. The current situation is the result of forty years of repressed debate over the very fundamental questions that occupied economists in the earlier period. We are now condemned to relive the debates unless we succeed in using the earlier discussion as starting points.”
    “In particular, Mises and Hayek went a long way toward solving a theoretical problem that besets economists today—the integration of monetary and value theory. Whatever else can be said about Hayek’s monetary economics, his work does consist of a monetary theory erected upon a consistent microfoundation. Whatever else can be said about almost any other monetary theory of economic fluctuations, it lacks that consistency. Since an avowed purpose of macro and monetary theory today is to provide a microfoundation for the analysis of economic fluctuations, this alone recommends a reconsideration of Hayek’s work.”

  7. Of course their winging it.we all are.And havent we been living in a propaganda state for the last eight years?Remember the build up to the collapse of Enron?Seem familiare?

  8. Fundamentalist quotes O’Driscoll as follows:
    “My argument, then, is that the various crises in economics are manifestations of inconsistencies in the neoclassical research program. These inconsistencies are present because of the curious admixture of Ricardianism and neoclassicism present in the modern research program. The inconsistencies were never resolved, though their resolution was in sight in the thirties when it was aborted by the Keynesian revolution. The current situation is the result of forty years of repressed debate over the very fundamental questions that occupied economists in the earlier period. We are now condemned to relive the debates unless we succeed in using the earlier discussion as starting points.”
    Ed Dodson here:
    One economics professor I have come to admire, Mason Gaffney (University of California, Riverside) has written very critically on the history of “repressed debate” within the economics community. However, he traces this problem of intellectual subjectivity to the late 1800s and the displacement of the political economy of Adam Smith with neoclassical economic theory that removed nature (i.e., land) as a distinct factor of production with characteristics quite different from that of labor and capital goods.
    Gaffney was early in his career greatly influenced by Harry Gunnison Brown and Henry George (who I would describe as the last of the great political economists). Gaffney’s analysis of the business cycle builds on the work of George and Brown, and he has provided us with a remarkably clear explanation of the interplay of markets for land, land, capital goods and credit. Keynes, for reasons he never explained, merely asserted that concerns about land monopoly expressed by his predecessors and a few stalwart contemporaries (John R. Commons, for example, as well as Brown) were not long an problem.
    What is clear for anyone who looks at the real estate markets during the current business cycle is that credit-fueled speculation in land and real estate is the major problem. Skyrocketing land costs eroded profit margins for businesses and turned the residential real estate market into a casino of property flipping, outright fraud, predatory lending, and the creation of supposedly high yielding financial instruments secured more and more by speculative land values than by actual property improvements. We ignore the dynamics of land markets — and the public policies that drive their dysfunctional operation — to our continued risk of repeated economic collapse.

  9. It’s called the ‘Permanent Income – Life Cycle Hypothesis’ (PI-LCH). This theory has largely been merged from Milton Friedman’s theory of permanent income and Franco Modogliani’s life cycle model of consumption, both of which helped earn their inventors Nobel Prizes.
    Friedman, as you may know, was considered the “father of monetarism”, leader of the so-called Chicago School and has always trumpeted the virtues of laissez-faire markets. Modigliani, was an old-school Keynesian at MIT, important figure in corporate finance and generally favored activist fiscal policy, at least when he wasn’t showering Friedman with exclamations like when he said “now we’re all monetarists”.
    The PI-LCH describes the discounted value of both transitory and permanent income, and destabilizing shocks to these income streams. While it’s an accurate approximation, consumption behavior has developed even further once one takes into account liquidity constraints, myopia, bequest effects, and other time inconsistent preferences with exponential discounting. Oh, and let us not forget Robert Hall’s theory of the random walk of consumption.
    One final note: I’m as free market libertarian as anyone around, but it really is time to denounce Austrian macro. Austrian micro has made a splendid name for itself with its early discovery of marginalism thereby providing a rebuttal to Marx’s labor theory of value, which, by the way, Marx took from early classical economists like Adam Smith and David Ricardo.
    But as I read some of these comments here, and elsewhere, by idiots like Ron Paul, I am struck by the absolute absurdity of Austrian business cycle theory masquerading as anything intelligent and rigorous, which is almost invariably accompanied by a fetish for some gold or other metallic standard.
    —Former Cato intern

  10. I had this reaction a couple of months ago when Thomas Friedman said, on the NYT op-ed page: “The equity crisis made people feel poor and metastasized into a consumption crisis, which is why purchases of cars, appliances, electronics, homes and clothing have just fallen off a cliff.”
    That was when I knew no one actually gets it. The “equity crisis” made people feel poor? How many average Americans were making purchases with equity?
    I don’t pretend to be an economist, but I have a very good education and I’m a whiz at math. It doesn’t take a genius to figure out that the “consumption crisis” was spurred by the rise in gas and food prices that began nearly a year ago. The average American saw the price of essentials–food and fuel–skyrocket. “Middle class” plummeted to “borderline poor” in the span of about four months (May – August 08). Further, as any middle class wage-earner can tell you, that was simply the capper on several years of raises not keeping pace with the real cost of living.
    (That food prices are not included in the inflation rate, and then the inflation rate is used as some indicator of purchasing power, boggles my mind. It’s like calculating a launch of the space shuttle without considering gravity. You want a “theory of the events that predict revisions in an individual’s estimates of her lifetime income”? Start with personal budgets. The amount left over after food, clothing, shelter, utilities, and fuel is paid is directly proportional to how confident people feel about their lifetime income.)
    The economic collapse and rising unemployment at the end of the year was just the roofing on the bunker, eliminating any tendency to spend “future earnings” and increasing the urgency of paying off any current debt. Americans were already pulling back. Now we’re hunkering down in hopes that we’ll get out of this crisis with jobs that pay a living wage.
    Economists need to come out of their ivory towers once in a while.

  11. Typing Correction: It’s Modigliani. I accidentally spelled his name wrong the first time because I absolutely suck at typing, and the “o” key is next to the “i” key.
    But I still firmly stand by the proper castigation I gave to Austrian business cycle theory.

  12. the economists are definitely clueless. Just look at the economy now and the economists have no idea how to bring us out of the trouble

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