Bruce Bartlett on Liberaltarianism

An excellent column from Bruce Bartlett. Some highlights:

But even these metro-libertarians tend to be more concerned about economics than social or foreign policy. The Cato Institute publishes an annual survey of economic freedom throughout the world, but produces no surveys of what countries have the most political or social freedom or those that have the most libertarian foreign policy.

Furthermore, economic freedom tends to be determined primarily by those measures for which quantifiable data are available. Since it is very easy to look up the top marginal income tax rate or taxes as a share of GDP, these measures tend to have overwhelming influence on the ratings. As a result, countries like Denmark, which are very free every way except in terms of taxes, end up being penalized. Conversely, authoritarian states like Singapore don’t suffer for it because they have low taxes.

I’d very much like us to try to measure freedom more broadly. The fact that it is an “essentially contested” concept needn’t cause too much worry. What we should try to do is compile a number of different indices that reflect a variety of widely accepted conceptions of freedom. My hypothesis is that we would find most of them highly correlated with another, and with a wide variety of social indicators. The ones that correlate poorly with the others and/or correlate poorly with various indicators of well-being and human development can probably be just thrown out.

More from Bartlett:

At the liberaltarian dinner, many of the liberals persuasively argued that the pool of freedom isn’t fixed such that if government takes more, then there is necessarily less for the people. Many government interventions expand freedom. A good example would be the Civil Rights Act of 1964. It was opposed by libertarians like Barry Goldwater as an unconstitutional infringement on states’ rights. Yet it was obvious that African Americans were suffering tremendously at the hands of state and local governments. If the federal government didn’t step in to redress these crimes, who else would?

Since passage of the civil rights act, African Americans have achieved a level of freedom equal to that of most whites. Yet I have never heard a single libertarian hold up the civil rights act as an example of a libertarian success.

One could also argue that the women’s movement led to a tremendous increase in freedom. Libertarians may concede the point, but conservatives almost universally view the women’s movement with deep hostility. They think women are freest when fulfilling their roles as wife and mother. Anything that conflicts with those responsibilities is bad as far as most conservatives are concerned.

I think part of the problem is that if you hold up the Civil Rights Act as an example of libertarian success, most libertarians will deny that you are one. I think both the Civil Rights Act and the women’s movement did in fact lead to tremendous net increases in liberty. I think Bruce makes an excellent point. Federal intervention, while certainly limiting freedom of association and trumping more local jurisdictions, resulted IMO in an overall increase in freedom. That many traditional libertarian conservatives, such as Goldwater, seem to have been willing to sacrifice a great gain in overall freedom in order to maintain status quo levels local self-rule seems to me to betray a commitment to ancient ideals of liberty as community self-government in conflict with the modern idea of liberty as freedom from coercion.

I think one could buy into all of this and safely maintain libertarian bona fides. But I think that in order to endorse the freedom-enhancing nature of the influence of the women’s movement, you need to accept that cultural norms and social expectations can restrict liberty without the backing of state coercion (though state coercion very often does reflect and reinforce liberty-limiting cultural norms and social expectations). I accept that you don’t need state coercion to threaten liberty. That’s where some libertarians draw the line. But, please note, if one thinks that culture and convention can limit liberty, it does not follow that one must also think that it is permissible for the state to intervene in order to change convention. One can believe that the state may legitimately act only to protect liberty. But that does not imply that the state must do anything in its power that might protect or enhance liberty.

Hansonian Cultural Politics

Robin Hanson replies to my post below on cultural externalities and harm:

When I ask students to justify various subsidies and taxes, they are quick to say “externality,” but slow to identify specific plausibly-related side-effects, and even slower to seek opposing side-effects.  They usually just seek support for pre-existing intuitions.

Like Robert Frank and Geoffrey Miller, Will Wilkinson seems to me a bit too quick here to assume the activities he likes are less deserving of taxes.  I’ve been arguing mostly for consistent application of principles.  If we are to tax positional or unhappy activities, then let’s do that consistently, following our best data on positionality or happiness.   Let’s not just selectively apply a rationale to things we already intuitively disliked.

We have long had a clear theoretical basis for allowing businesses to harm each other via competition, but we have less clear a basis for allowing harm via changing expectations about car standards, female workers, neighborhood race, and marriage legitimacy.  So I won’t rule taxing such things out of hand.  But I will insist we first articulate a clear principle we are willing to apply consistently across a wide range of cases.

First, I think Robin may have missed one of my key points, which is that “negative externality” is not a synonym for “harm” in the relevant sense of the word. It begs the question to just go ahead and talk about various harms as if I had not just argued that they don’t all count as harms just because someone is bothered by each of them.

Another of my key points was that the fight over what is and is not included in the category of harm is to a great extent what “culture war” is about. If Robin wants a clear theoretical basis for who ought to win these fights, then he needs a moral theory. But a clear theoretical basis is different than a decisive theoretical basis–a basis that all are bound to accept on pain of irrationality. I don’t think there is any such basis. To put it another way, there is no clear theoretical basis for selecting a single, clear theoretical basis for determining what does and does not count as a harm. Indeed, no one is rationally bound to accept the normative assumptions underlying the case for economic competition–the clear theoretical basis for “harm” Robin is willing to accept. Many people understand perfectly well that anti-competitive measures such as subsidies or tarrifs buy temporary stability at the price of utility, and they think it’s totally worth it.

Moral diversity and disagreement are ineradicable. Disagreement over what does and does not count as a harm is ineradicable. Something like agreement over various cases and principles emerges through the fight of what I call, following Richard Rorty, cultural politics. Part of the fight is to get intellectual types to agree that your theory of harm is compelling. One way we do that is to push on consistency. So we say to people who lose a job to offshore outsourcing that this is really no different than losing a job to a robot, but we don’t think we should protect workers against robots. But this kind of thing only takes us so far. Most of the fight is to get sufficient buy-in from whatever forces shape public opinion and public attitudes. Natural human conformism takes care of the rest.

Robin might want to consider that moral categorization is by its nature contingently nominalistic. The fact that enough people just do consider one thing and not another thing a harm, due to the local history of cultural change and socialization, might seem to lack theoretical normative teeth, and leave little space for criticizing the actual system of norms. But the actual system of norms has actual normative teeth pretty much by definition. Which is why we work so hard fighting over the norms, whether or not we can come up with a unified, clear, coherent theory that accounts for their authority.

My sense is that Robin wants some kind of theory that allows us to avoid cultural politics. I don’t think there is one. I think Robin complains that I share Miller’s and Frank’s reliance on intuitions about things we happen to dislike because I’m arguing with them from within what I see to be their prior liberal moral commitments, which I share. We’re all liberals, which means we dislike many of the same things. We’re not starting from nowhere. So I’m trying to show that their arguments leave them at a place at odds with something we all like very much: a pluralistic, liberal, open society tolerant of dissent, peaceful cultural conflict, and social change.

Robin wants to argue from a more abstract, culturally disembodied position. What must be true if positional or pro-happiness taxation makes sense, and what do these truths imply if applied consistently? I don’t see this as much different from what I’m after. Geoffrey Miller and Robert Frank clearly endorse certain epistemic norms which make arguments from consistency, like Robin’s, extremely effective. By their own lights, they owe Robin an answer. We’re right to demand that serious intellectuals stick as close to possible to the best norms of rational argumentation, just as we’re right to expect liberals to stick to their liberal commitments.

Anyway, one can’t fault others for failing to cut nature at the normative joints, since there is no such thing. At some point, we lean pretty hard on things we already intuitively dislike, and if enough people agree with us, we win. Robin has a classic rationalist’s skepticism about the authority of our intuitions, other than his intuitions about epistemic integrity, which puts him in the position of a revolutionary, prophethic outsider. This can be an extremely powerful position–if we don’t decide Robin’s just crazy. And we’ll decide he’s not just crazy insofar as we share his intuitions about the the authority of his conception of rationality. That Robin’s so successful at selling his frankly unusual vision of unbiased rationality shows that he’s much better at cultural politics than he gives himself credit for.

Cultural Externalities and Harm

Robin Hanson’s ongoing discussion of positional goods, signaling, and consumption externalities at the new, exclusively Robin Hanson Overcoming Bias has been terrifically stimulating. I have a few thoughts about the relationship between externalities and “harm” that Robin’s discussion has stirred up.

Suppose you’re a Millian liberal devoted to the harm principle, which goes like this:

That principle is, that the sole end for which mankind are warranted, individually or collectively, in interfering with the liberty of action of any of their number, is self-protection. That the only purpose for which power can be rightfully exercised over any member of a civilized community, against his will, is to prevent harm to others.

Now suppose you, like many economists, are inclined to leap a bit hastily from “negative externality” to “harm.” And then suppose you, like Robert Frank, have a strong view about consumption externalities. When I buy a really expensive car, this story goes, it subtly shifts my community’s frame of reference for signals of social status and for judging the the adequacy or socially acceptability of certain vehicles. By diminishing the status signal sent by older and/or less expensive models, my choice exerts a subtle pressure for others to increase spending simply to maintain the constancy of the signal sent by their cars. If we decide to count this kind of effect as a “harm,” then sumptuary taxes pass Mill’s test and therefore do not count as paternalistic. We need not even torture the language and call regulation to reduce consumption externalities anything stupid like “libertarian paternalism,” since it’s not paternalism at all! Sure, the person facing a steep tax on luxury may be helped by a fiscal inducement to stay off the conspicuous consumption gerbil wheel, but that’s by the bye. The point is to prevent “harm” to others through individual consumption choices.

As Robin has been insistently pointing out, how good-looking we are, the quality of our mates, how smart and funny we are when we talk, and the impressiveness of our children’s achievements signals at least as strongly as our cars. If our investments in appearance, mate selection, Bourdieuian cultural capital, and children are not equally harmful, then why not? If you think regulating luxury consumption passes Millian muster, then why wouldn’t regulating extremely impressive feats of oratory or athleticism?

I think this line of thinking can be taken even further. Many so-called “culture wars” are largely about cultural externalities. Consider Linda Hirschman-like arguments to the effect that women who choose to stay at home raising children impose a significant cost on women who wish to pursue professional success by reinforcing traditional stereotypes of women’s relative strengths and by creating rational expectations among employers that firm-specific investments in female employees will have a lower than average expected payoff due to the possibility of maternity leaves or long-term exit from the labor market. The argument that stay-at-home moms ought to be stigmatized, or at least be extended decreasing levels of social esteem, is basically an argument for the cultural version of a tax on choices that have negative spillover effects for others. If the state took a side on this and actually did tax stay-at-home moms, would that pass Millian muster, on the grounds that mothering choices have spillover effects that “harm” other women?

I think that at this point Mill would suggest that something has gone dreadfully wrong. It looks like we’ve defined “harm” so loosely that the harm principle, so understood, could be the basis for the state regulation of any action whatsoever that affects anyone else in a way they don’t like.

Consider pecuniary externalities. If I open a hot dog stand across the street from your hot dog stand, I will take some of your business, or force you to cut your margins, and thereby make you poorer. Have I “harmed” you in some way that requires that you be made whole, or that suggests the wisdom of the state’s preventing future instances of such harm? The law says no, and the law is right. You have no right to local monopoly profits from hot dog sales. Indeed, pecuniary externalities are so valuable that there is a whole body of antitrust law ostensibly intended to promote them.

Now, when a black family moves into a neighborhood of white racists, thereby causing great unhappiness, or when the recognition of the legitimacy of gay marriages causes traditionalists to feel that their traditional marriages have been “devalued,” that’s the cultural analogue of a pecuniary externality. Somebody really is getting hurt in some real sense. But I don’t much care, and Robert Frank probably doesn’t either, if some racists are disgruntled by their neighbors’ color, or if some religious folk feel aggrieved by a perfectly accurate sense that the social esteem afforded their particular type of marriage has fallen in relative value.

Coasean logic focuses us on the duality of externalities. In the land of the deaf, there is no noise pollution. In the land of cosmopolitan enlightenment, there is no “there goes the neighborhood.” Progressive social change occurs through a revaluation of where to locate “the problem.” Is it in the signal or in the receiver? To identify a “harm,” and to invoke the harm principle, the moment there is a complaint, is the essence of reactionary politics. It is to shut down the very possibility of relocating “the problem” from the source of a reaction to the reaction itself. This would be the very opposite of the intention of Mill in On Liberty, which is at bottom a call for the cultural version of dynamic, ideally competitive markets roiling constantly with the hurt of lost market share.

The Caveman Roots of Liberal Democracy?

Stimulating thoughts from Razib (aka “David Hume”):

But a dispositional conservatism serves more than a periodoc brake upon the inevitable march of history toward its final Utopian state.  In fact the empirical record shows some cyclical dynamics in human morals and values. After all, Western liberal democracy is a throwback in many ways to the individualism of the hunter-gatherer phase of human history. I believe that the institutions and norms of communitarian “traditional” cultures were in fact ad hoc kluges which attempted to reconcile our “caveman psychology” with post-Neolithic mass society. Conservative and liberal dispositions seem to be partly hardwired; as humans we place ourselves along the spectrum. It is not simply a matter of conservatives always being a few generations behind liberals along the inevitable secular ascent up toward earthly paradise. Rather it seems possible these different political tribes are like two cylinders which serve as the motive force behind a winding and unpredictable journey.

Why is the journey unpredictable? One reason: Cultural evolution is unpredictable and the content of the beliefs and norms attractive to those with partly-hardwired liberal and conservative dispositions — the parameters of the liberal-to-conservative continuum — at any given time is a matter of the forces of cultural history as they interact with the forces of population change. Ideas and norms can’t stick if our evolved minds are inhospitable hosts for them. So the fixed part of human psychology is a constraint on cultural transmission. If we find liberal individualism at all compelling, it’s because we already have a taste for it. Likewise thick communitarian socialism. Culture wars are wars in part over which tastes to gratify and encourage and which to stymie and treat as a threats to decent civilization.

I agree that our conservative impulses aren’t going anywhere. So, what if people with conservative impulses reproduce at a greater rate? It’s interesting to think about what happens when the cultural parameters of the liberal-to-conservative continuum shifts in a liberal direction faster than dispositional conservatives can breed. And maybe something like this is Razib’s idea. If the stipulated demographic trend continues–conservatives keep reproducing faster–then conservative dispositions will become relatively common and liberal ones relatively rare. At some point, this stalls further liberalization, even if it had a lot of momentum behind it. And then you’d think maybe we slide back in a “traditional,” communitarian, family-centric direction. But I guess this depends on what a native “conservative disposition” comes down to. If it’s a kind of conformist hesitancy to alter the social order, then a preponderance of conservatives may do little more to lock in liberalization, just as today’s conservatives praise to the Heavens the timeless verity of a bunch of extremely radical 18th-century liberal ideals.

Libertarian Ideal Theory as Silent Complicity

Steven W. Thrasher in the NY Times a couple days ago:

In 1958, when my mother, who was white, and father, who was black, wanted to get married in Nebraska, it was illegal for them to wed. So they decided to go next door to Iowa, a state that was progressive enough to allow interracial marriage. My mom’s brother tried to have the Nebraska state police bar her from leaving the state so she couldn’t marry my dad, which was only the latest legal indignity she had endured. She had been arrested on my parents’ first date, accused of prostitution. (The conventional thought of the time being: Why else would a white woman be seen with a black man?)

On their wedding day, somehow, my parents made it out of Nebraska without getting arrested again, and were wed in Council Bluffs, Iowa, on March 1, 1958. This was five years before Nebraska would strike down its laws against interracial marriage, and almost a decade before the Supreme Court would outlaw miscegenation laws throughout the country in Loving v. Virginia.

When the good state of Iowa conferred the dignity of civic recognition on my parents’ relationship — a relationship some members of their own families thought was deviant and immoral, that the civil authorities of Nebraska had tried to destroy, and that even some of my mom’s college-educated friends believed would produce children striped like zebras — our family began. And by the time my father died, their interracial marriage was seen just as a marriage, and an admirable 45-year one at that.

I suppose some of you will say that the “libertarian” position in 1958 was that the state has no place in marriage, and so the libertarian, as such, would have had nothing to say about the refusal of many states to recognize marriages between mixed-race couples. But in the world as it was, this stance would have amounted to an active refusal to resist the law’s codification of racial discrimination and segregation. It would have made one a silent partner in injustice. Those making similar arguments today will have to excuse me if I find this stance disgraceful. Many libertarians think there ought to be no government regulation of the economy, for example, but do not hesitate to take the practice for granted when they loudly opine about the extent and structure of regulation. Few say, “There should be no regulation, and so I, as a libertarian, have no opinion about how it should be carried out.” Yet I hear again and again that, since the state should not be in the business of marriage, one should not, as a libertarian, have an opinion about how this business is to be carried out. Increasingly, I find this an obnoxious and shameful form of moral recusal. One cannot use an ideological image of perfect justice to excuse or ignore an obvious injustice within the actual imperfect system. That these injustices could not arise within one’s vision of the best society does not mean that they have not in fact arisen. That a debate would not occur in an ideal world does not mean that it is not occuring or that nothing morally hangs on its conclusion. To decide to sit out the debate, with an eye on utopia, is not a way to keep one’s hands clean.

Falsity: Not a Hill Worth Dying On

If I read him right, Robert Stacy McCain’s argument for state-enforced marriage inequality (“a hill to die on”!) is that there is a DEEP TRUTH about inequalities between men and women that must continue to be observed:

Feminist ideologues insist that men and women are not merely equal in the Lockean sense — having the right to life, liberty and property — but are radically equal in the sense of being inherently identical.

The differences between men and women, according to the egalitarian view, are so trivial that the law must forbid any recognition of such differences, so that the sexes are treated as interchangeable. As I argued in January, it is from a careless acquiescence to this egalitarian falsehood that Americans have been steadily — one might well say “progressively” — marched to the point where the Iowa Supreme Court mandates gay marriage and anyone who questions that ruling is dismissed as an ignorant, hateful bigot suffering from the mental disorder of “homophobia.”

What did McCain argue in January?

Are men and women equal in the fullest sense of the word? If so, then equality implies fungibility — the two things are interchangeable and one may be substituted for the other in any circumstance whatsoever. (La mort à la différence!) Therefore, it is of no consequence whether I marry a woman or a man.

[…]

This is why so many of those who would defend traditional marriage find themselves unable to form a coherent argument, because traditional marriage is based on the assumption that men and women are fundamentally different, and hence, unequal. Traditional marriage assumes a complementarity of the sexes that becomes absurd if you deny that “man” and “woman” define intrinsic traits, functions, roles.

To declare men and women unequal, however, puts one outside the law — you are guilty of illegal discrimination if you say that there is any meaningful difference between men and women. Yet if you refuse to argue against sexual equality, you cannot argue effectively against gay marriage, and find yourself subjected to lectures about “accessing the positive social norms” with nothing important to say in reply.

I suppose one could say this is refreshingly frank. But let’s think about the argument (setting aside McCain’s risible claims to membership in some legally and socially persecuted class of put-upon sexist homophobes).

Like many conservatives, McCain makes libertarian noises when it suits him, but when it comes right down to it, he believes the role of the state is to reinforce “traditional” social forms though the law. The “libertarian” conservative rarely wants the state to leave people alone. He wants social change to leave state-enforced legal inequality alone, which is, after all, a proud tradition, sanctified by history. As McCain says, “traditional marriage”—and the state that ensures the exclusivity of its privileges—assumes certain “intrinsic traits, functions, roles” for men and women. He wants the state to police these imagined distinctions. And he very clearly recognizes that there is an alternative “egalitarian” view according to which the there is no relevant difference between men and women—as far as a just scheme of laws is concerned. So he recognizes that there is a stark moral disagreement between egalitarians and anti-egalitarians. McCain clearly has no problem with the state taking sides in this disagreement. He demands that the state take sides with anti-egalitarians. Indeed, he thinks the conservative movement ought to be willing to die fighting to ensure the state keeps taking the side of inequality.

Now, the conservative tends to make two arguments in this kind of dispute. First, that the inequality they wish to preserve in law is an inequality that has been there a long time. Second, that the inequality reflects a DEEP TRUTH about humanity. Generally, these are linked. The inequality in question is embedded in law and tradition because it reflects a DEEP TRUTH. So the fundamental issue is the DEEP TRUTH’s truth. McCain seems to accept that everything turns on this. He seems to know that if he’s wrong about this, he has no case against marriage equality.

The problem for McCain is that you don’t need to be a feminist ideologue to see that the alleged DEEP TRUTH is in fact an especially vulgar instance of the naturalistic fallacy. From the point of view of a decent morality, men and women are equal in all morally relevant respects. Marriage is important to men and women. Family is important to men and women. So a morally decent set of laws ought to maintain the conditions under which men and women are able to express their love and commitment through marriage and realize their desires to raise families. The problem is precisely that the law fails to do this. The reason it fails is that the law (in most states; not here in Iowa!) reflects the still-popular but intellectually bankrupt view that biological regularities establish binding moral guidelines.

Now, no two individuals are identical, and differences in capacities and preferences are relevant to differences in individual reasons and plans. The capacities and preferences of average men and average women mostly overlap, but sometimes they starkly diverge. But the divergence in capacity and preference between an average man and an average women is no more interesting morally than the differences between two individuals of the same sex. If I like brunettes and McCain like blondes, so be it. And if I like women and McCain likes men, so be it. The fact that an individual’s capacities and preferences diverge from the statistical norm for their sex has no interesting moral implications, either. 

It is a fact that most men and women find something deeply meaningful in the complementarity of masculinity and femininity. It is a fact that most couples who marry will form families in the usual mammalian way. But recognizing  equality under the law with respect to marriage does nothing to change this. It does nothing whatsoever to keep statistically average men and women from doing what they will do anyway. It is also a fact that the law, as it now stands in most states, prevents certain men and women from enjoying the legal privileges of marriage and protection for their less conventional families. To see the move to rectify this injustice as itself some kind of injustice simply because men are convex and women are concave is an embarrassing absurdity, not a hill worth dying on.

Classical Liberalism Is Not Colorblind

Jonah Golberg argued last week that there is something “unlibertarian” in pointing out, as I did, that 

American drug prohibition and sentencing policies hit poor black men the hardest, devastating already disadvantaged black families and communities—a tragic, mocking contrast to the achievement of Obama’s election. 

Jacob Sullum has replied in much more detail than I could have, concluding:

From a libertarian perspective, the war on drugs would be unjust even if its victims were a statistically precise cross-section of the American population. But the fact that it disproportionately harms members of a racial minority that was long subject to official discrimination in this country is additional cause for concern, especially since the laws it enforces grew out of explicitly racist anxieties.

But I’d like to single out this claim of Jonah’s:

It seems to me that the classical liberal is supposed to see people as autonomous and sovereign moral actors, not identity politics groups.

This sounds to me like Jonah thinks the classical liberal is supposed to play stupid. Jonah is fully aware that this is a country that for most of its history has been dominated by “identity group politics,” if you want to call it that. Blacks have been legal slaves. Jim Crow established legal racial segregation. We’ve not overcome the legacy of this. We live with urban policies that were initiated as thinly veiled attempts to reinforce residential segregation. We live with education policies that create a de facto segregated and highly unequal system of education. And, as Jacob emphasizes, drug policy has never been color-blind. To point out that it burdens blacks disproportionately is simply to point out that American public policy has never stopped being racist, has never stopped reinforcing a shameful structure of racial stratification squarely at odds with the classical liberal ideal of equal freedom under the law. Classical liberalism is not the stupid idea that there is no history. Nor is it the stupid idea that individuals who are members of groups that have been, and continue to be, victims of discriminatory state action are as fully free as individuals who are not. Classical liberalism is the demand that the state treat mature individuals as equally autonomous and sovereign moral agents, which is why it is necessary to point out the disturbingly discriminatory nature of American drug policy.

[Update: Please also see John Schwenkler and Mark Thompson. Update update: Also and especially John Holbo. How did I miss all this stuff I apparently started.]

The Lump of Liberalism Fallacy

That’s what I’m going to call the error I sense lurking beneath a lot of resistance to moderate libertarianism. The fallacy is based on an implicit denial of the fluidity of ideology and political identity. The bounds of “right” and “left” have shifted immensely over the past two generations. Yet political conversation at any time tends to proceed as if the ideological inclinations and cultural assumptions of the “left” and “right” are natural, essential, and fixed. So, just to pick an example out of the air, the argument that the considerable intellectual, cultural, and psychological overlap between moderate classical liberals and market-friendly modern liberals ought to be given more coherence as a political philosophy and political identity is invariably met with the claim that this is compltely pointless because these groups have traditionally been part of different partisan coalitions, and these coalitions are essentially this or that way. So in order to make something liberaltarianism a going concern, you’ve basically got to find enough libertarians and natural Democrats both willing to sell out everything they believe in and good luck with that. It’s basically the same reasoning that says it is impossible to introduce to market a successful new brand of cereal because all the preexisting cereals brands already have 100 percent of the market share. But there’s something pretty obviously wrong with that way of thinking. I’m a big fan of Kashi U

Meanwhile, see Matt Welch’s puzzling piece on “The Liberaltarian Jackelope.” Matt’s argument seems to be that he’s totally a liberaltarian, that it once looked as though some Western Democrats might make some electoral headway by taking on a bit more libertarian flavor, and this excited him. But it turned out that Democrats aren’t even interested in following the Republicans in using fake libertarian rhetoric for political gain. So liberaltarianism is doomed.

The Obama Budget

Clive Crook’s gloss is right-on:

Take this budget at face value, and when Mr Obama talks about “a new era of responsibility” he does not mean: “We are all in this together.” He means: “The rich are responsible for this mess and it is payback time.” Leftist Democrats are thrilled, and rightly so. The budget has three themes: healthcare reform, public investment and unflinching redistribution. This is indeed a new social contract: we get, they pay. 

This is, in fact, one of the reasons I am increasingly optimistic about liberaltarianism. I predict Obama’s unabashed embrace of throwback, dirigiste, soak-the-rich “liberalism” will not prove popular with generally pro-market, well-to-do voters who crossed over for the first time to pull the lever for a Democratic president. Yet the not-very-religious remain repelled by social conservatism all the same. As I’ve said, it doesn’t matter to me whether the Republicans become more liberal on “values” issues or whether Democrats adopt more sensibly market-oriented social and economic policy. Either way, by signaling the desire of contemporary Democrats to move even further left than is feasible in the U.S., Obama draws attention to the unoccupied space in American politics.

Sumner on Free Markets and Liberal Values

Scott Sumner is on my wavelength

So after 1980 “brute facts” about the weaknesses of statism pushed most of the world toward free markets.  But there was (as yet) not enough evidence to abandon the egalitarian systems of social insurance.  If I am right, then countries with more liberal values should have responded to this new information by becoming much more free market oriented, but not necessarily by reducing the size of government.  But how do we measure liberal values?

Then I ran across a paper by two French economists, Algan and Cahuc, which showed that countries with a high level of civic trust (such as the Nordic countries), tended to have generous unemployment compensation and fewer restrictions on firing workers, and countries with less generous benefits tended to have more rigid labor laws.  I realized that their measure of values (a survey question asking “would you accept government benefits to which you were not entitled?”) was perfect for my research.

They found Denmark to have the most civic honesty, but when I used a more complete sample of developed countries, Denmark was just edged out by Malta.  But I also had a nagging worry about self-reports on honesty (”You Maltese say you are honest, but . . . )  Thus I decided to average this self-described civic honesty metric with a more objective survey—the corruption index produced by Transparency International (which was topped by Denmark.)    When the two indices were averaged Denmark moved far ahead of the field—if its score was set at 100, the next three countries were tied way back at 86.  Because of this blog’s growing popularity, I won’t mention how far Malta slipped, as I wouldn’t want to embarrass any readers from that tiny island nation.

I decided to measure neoliberalism by using the (2008) Heritage Institute’s Index of Economic Freedom minus the two “size of government” components (taxes and spending.)  If one simply averaged the other eight components, Denmark edged ahead of Hong Kong as the surprising winner of “most free market economy on earth.”  I was pleasantly surprised by this finding (achieved without any data mining) as it beautifully fit my dialectical approach to neoliberalism.

Even better, I found this index of neoliberal (or free market) policies was strongly correlated with my index of “liberal” (or idealistic) values.  Indeed the correlation is even pretty strong for the unadjusted Heritage Index of Economic Freedom (despite the fact that that index is topped by a country, Hong Kong, with considerably less liberal values than Denmark.  You’re probably thinking, OK, but correlation doesn’t prove causation.  Lots of country characteristics are positively correlated.  And what my hypothesis actually requires is that a place like Denmark only became highly free market-oriented after the changing intellectual climate made liberals less enamored with statist policies.

To get data going back to 1980, I had to use the Fraser Institute’s Index of Economic Freedom, a (surprisingly fierce) competitor to the Heritage Index.  Here the results were even more gratifying.  My first regression showed that the more liberal a country’s values, the more rapidly it moved away from statism after 1980.  How about that, Naomi Klein? Between 1980 and 2005 only New Zealand moved toward free markets more rapidly than Denmark.  My interpretation is as follows.  Free market reforms threaten to erode rents earned by various special interest groups.  Thus after 1980 these reforms were more likely to occur in countries where the civic culture is more oriented toward the common good.  (In other words if you hear that culture is “tribal,” or that “family comes first,” it’s economy is likely to have statist economic policies.)

My initial reaction was that Deirdre McCloskey would love this finding.  I had just published a long-winded 27 page book review of her fascinating (but equally long-winded) The Bourgeois Virtues.  In that book she fires her shots in both directions at once.  She concedes the good intentions of those on the left, but scolds them for not being more open to what I called the economistic worldview.  Indeed many don’t even understand that such a worldview exists.  She thinks people on the right such as George Stigler were right about free markets, but wrong about values.  Stigler had argued that it is a waste of time for idealistic economic researchers to try to persuade policymakers, as the later group is motivated by self interest.  And rent seeking special interest groups are more able to satisfy those interests then are idealistic economic professors.  McCloskey countered that one cannot run a sound economic system on just self interest.

My findings suggest that Stigler is wrong, as the more idealistic a country’s values, the more rapidly they moved toward free markets when statism became discredited.  But to people like Paul Krugman, Joe Stiglitz, James Galbraith and Naomi Klein, the findings are equally inconvenient.  Far from being a right wing plot, the strong move toward freer markets and lower marginal tax rates that occurred in almost all developed countries after 1980 was actually driven by idealistic values, indeed I would argue by “liberal” values. 

Do read the whole thing.