1. The welfare state is not going away. But it is imperative that we avoid Western European levels of taxation through the explosion of Medicare liabilities…
2. What recipes lead to both strong markets and decent governance?…
3. We face a variety of critical issues involving decentralization: how to deal with pandemics, natural disasters, or terrorists with nuclear weapons, to name but a few. None of these are areas for laissez-faire. Yet for all the squawking about the need for government, most of the real solutions “on the ground” will emphasize voluntary action and the private sector…
Overrated classical liberal ideas are privatization (sometimes useful, but it often replicates old problems in a new regulatory guise) and abolishing foreign aid.
Here are my thoughts:1. We need to emphasize the middle ground in between the welfare state and individualism. We can be for helping the poor and providing public goods, and still be against government.
2. I believe quite strongly in the importance of the institutions of civil society. Take away families, churches, civic groups, community associations, standards bodies, charitable organizations, and others, and you are left with either individualism or government. Conversely, the more you strengthen government, the more you tend to weaken the elements of civil society.
3. A classical liberal in this century should be relatively apolitical, in the sense of not rooting strongly for a political party. Instead, encourage the nongovernmental components of civil society, particularly private schools and private forms of saving and insurance.
4. Private forms of support for intellectual property, in the form of patronage, should be allowed to substitute for the legalistic approaches of patent and copyright. In fact, I hesitate to use the term “intellectual property” and would prefer the term “patronage goods.”
5. Above all, a classical liberal needs to identify, expose, and counter the marketing strategies and tactics that are used to expand government. Both political parties play up fears in order to sucker us into ceding money and power. Just as certain citizens’ groups are known for exposing the false advertising of corporations, we need to expose the false advertising of politicians.
READER COMMENTS
Omer K
Jul 9 2006 at 3:48pm
“We need to emphasize the middle ground in between the welfare state and individualism. We can be for helping the poor and providing public goods, and still be against government.”
Words of a dreamer. Why should we be “helping the poor”? Why are the “poor” poor? A big chunk of the reason is a faulty work ethic and desire to mooch off of others for life and sustenance. America is such a rich country that even working in the lowest of the low jobs allows a decent standard of living and then some for savings.
But to do so requires them to forego luxuries, its a hard choice not to spend part of ones meager savings on disposable goods instead of saving for the future or old age. But its a choice which will be made in the absence of a welfare state.
What Im trying to say is
1) Theres very few poor people who actually need help rather than a dose of reality. We’ve been talking about the “poor” for so long we have forgotten that the welfare state is all about the subsidizing of their expectations more than anything else.
2) Most people know this.
3) Given the incentives and reality of the situation, there is no “middle ground”, simply a political game where the lazy try to take from the industrious, or the industrious try to maintain their liberty.
Omer K
Jul 9 2006 at 4:03pm
4. Private forms of support for intellectual property, in the form of patronage, should be allowed to substitute for the legalistic approaches of patent and copyright. In fact, I hesitate to use the term “intellectual property” and would prefer the term “patronage goods.”
Quick thoughts (though not comprehensive).
Even assuming a somewhat moral people, people would be unwilling to patronize with their hard earned resources simply because its not a fair world.
If someone is taxed 40% of all he makes and furthermore that money goes to fulfil goals that the individual does not belive in, then the thought that that person will not (at least eventually) consider it his right to leech someone elses resources is idealistic. As they said in the old Soviet Union, “Everything belongs to the state, and the state belongs to me, therefore everything belongs to me” (read that in Thomas Sowell’s Basic Economics)
My point is
In an unfair world, the incentives change to make individuals themselves unfair. If we mentally posit over this inherent biological inequities, it really is out of our hands. What you are arguing for is simply asking a group (the people who are patrons) to subsidize another group (who get the stuff free of charge). AKA Socialism.
Theres nothing wrong with having “patronage” and “copyright” work side by side, but in this case most producers would opt for copyright. Just like in politics, in the United States, anyone can start a communistic commune AKA this country is not capitalistic nor communist in nature. But there arent any communes because in a free market of competition between ideas, capitalism provides a better life over communism for its members.
There already is limited patronage in existance, in my experience in the form of paypal donations to myriad software producers. I myself have donated to Mozilla (FireFox), Spybot (Anti ad software) etc.
secret asian man
Jul 9 2006 at 4:43pm
Federalism is the answer. Socialist states inevitably fail as they cannot attract talent and capital and they cannot adequately use the talent and capital they have.
Passing federal legislation that makes social programs completely the responsibility of the states will bring this about.
This is also why liberals always fight at the national level and why Mass. didn’t pass socialized medicine.
They know they’ll lose.
Dan Landau
Jul 9 2006 at 7:42pm
You are too pessimistic saying, “The Welfare state is not going to go away.” The process has already started. In education, the WSJ recently reported a second generation of for profit universities. Today’s parents, even if they use public schools, spend large sums sending their children to after school and weekend private for profit classes in art, dancing, etc. In medical care, my doctor dropped Blue Cross, I didn’t switch doctors, I am paying $60 per visit. In retirement, half the working population has supplemental retirement accounts.
The fall of the welfare state will come sooner than we could hope for and will surprise many people just like the fall of communism did. The process will include the starting of private substitutes, even as the welfare state continues, and a decreasing supply of welfare state goodies due to rising costs. The second process is starting in many European countries.
Brad Hutchings
Jul 9 2006 at 10:25pm
(3) I would like to agree, but the problem is that the Dems offer no hope of ever wanting a private solution to anything. The Republicans occasionally offer some hope, though not much. The Dems are still stuck on an September 10 worldview. The Republicans seem to have lost most of their backbone on Iraq. When Dems and Reps actually agree on something related to terrorism or law enforcement, the results are usually pretty damned scary. Witness all the regulation of the net being pondered in the name of eliminating child porn on the net. On balance though, I feel a little safer with Republicans in charge.
(4) The transition to patronage will still need copyright and patents as legal bases. More and more software firms of all sizes are discovering that giving something away for free gets market power and enables other services to be sold. The ability to sell advertising will still depend on “owning” the underlying information or process.
Matt C
Jul 10 2006 at 12:19am
This reminds me of something I read recently. Some apparently-well-known libertarian was arguing for a VAT, on grounds that the battle against entitlement growth was already lost, and it was time to look for the least destructive means of financing. Gaaack!
Yes, the welfare-regulatory state is not going away. But it can probably be pushed back in places, and the line can be held in others. Who is going to argue for this if the libertarians won’t? Does being a “classical liberal” mean anything more than a big forehead and a detached appreciation for economic efficiency?
Fight the good fight.
Patri Friedman
Jul 10 2006 at 1:27am
I definitely agree on 3 & 5. Sort of depressing that the right way to express a political belief would be apolitically, but that’s what we’re stuck with.
purpleslog
Jul 10 2006 at 7:08am
Omer…there is a big gap between “mooching” and a legit social safety net.
RogerM
Jul 10 2006 at 9:08am
I hate to sound like a pessimist, but I don’t think there is anything we can do. Advertising and PR research suggests that the only emotion appeal that the public pays attention to is fear. The left, and politicians, have known and practiced this for a very long time, as Arnold notes. As a result, the welfare state may suffer minor setbacks, it will continue to grow until a major crises hits.
DavdMeleney
Jul 10 2006 at 4:13pm
RogerM’s pessimism seems consistent with the growth of governmental powers in the US for so many decades… and consistent with point #3 which suggests we avoid political parties….
But around the world most people now live in substantially more freedom than they did just 20 years ago…. and most of this change was effectively championed by political parties and the “freedom lovers” who often acted thru them.
I suggest point #5 be taken seriously, and if so, we need more powerful citizens groups that can garner publicity to expose the fear tactics of big government folk. While the Libertarian Party has often been too philosophical, too anarchistic, or too amateurish to serve this function well, at the national convention last week most of the platform was repealed for these very reasons. A party dedicated to gaining the support the 40% of Americans who do favor substantially smaller government, (rather than just the most radical 2% among us), seems to have been born. Check it out at: http://reformthelp.org/index.php
The Caucus claims to represent:
— Moderate libertarians who want to shrink government.
—Radical libertarians who realize that to shrink government a lot, we must first shrink it a little, and
—Anarcho-capitalists who realize that to eliminate government, we must first shrink it.
If countries with the bad politics of China, Russia, Indonesia, and India (circa 1985) could make such progress, who are we to look at our political realities and just give up? Lee Kwan Yu was a Marxist when he first gained power in Singapore, Deng and Gorbachev were far,far,far from perfect when they started to drive their political parties in better directions.
If you can come up with presentations that are suitable to present to your customers and co-workers and neighbors…. to your barber and your minister and your auto mechanic…. then we can create a political party that can win consistently. 40% of Americans is more than enough to do it.
But if we don’t try to win….we’ll never know.
mvpy
Jul 10 2006 at 5:52pm
“Above all, a classical liberal needs to identify, expose, and counter the marketing strategies and tactics that are used to expand government”.
But, lets face it, its economists who bear much of the responsibility for this. Its very much in the self interest of economists to ask for more government, since thats what will empower them (via the design of gov programs, advice to governments etc). In a free market, theres little role of the advice of economists.
In reality, this is the equilibrium we see. Arent the majority of academic economists liberals, and hence pro interventionism? And the textbooks, courses etc are replete with lengthy discussions of market failures, without rarely any allusions to the entrenched political failures, which, in my view, are much worse.
When a student leaves a course in economics today, he’ll typically say something like this in response to an issue – “Oh, I learned there are myriad market failures, so we need government to correct externalities etc. Plus, the pressing issue of inequality that Prof X was so concerned with. And when we have more government expenditure, we’ll get those miraculous multiplier effects to boot…”
On the whole, the classic liberal view is completely downgraded in conventional economics courses; and the virtues of the free market belittled.
Mr. Econotarian
Jul 11 2006 at 4:14pm
“We can be for helping the poor and providing public goods, and still be against government.”
Unfortunately, most people believe that “helping the poor” means raising the minimum wage to the point that the poor are unemployed. Or taxing the non-poor to the point that growth is slowed for everyone.
What we have here is a failure to communicate economics. The poor are almost always better off in countries with higher economic freedom.
RogerM
Jul 11 2006 at 5:00pm
I welcome the change in the Libertarian Party. The problem is that most economists are very poor communicators. We need to educate journalists, who although they’re ignorant on economics, are experts at getting the attention of the public and selling their positions.
Folk-Marxism still frames and drives the current debate. Marx was a genius at scaring the pants off people and making them pay attention. He scared people into believing that free markets create monopolies, are volatile, and cause huge inequalities.
To succeed as well as Marxism has, it’s not enough to counter those fears. We have to come up with more powerful fears. We had an advantage during the Cold War; we could scare people by telling them the USSR was hiding in the closet. But that bogeyman is gone.
One place we might start is showing people that Big Govenment is the friend of Big Business, not Average Joe. The American Spectator has a review of a book that claims to do just that. Maybe we can soil the reputation of government by associating it with what laymen fear most–Big Business.
Swimmy
Jul 11 2006 at 6:37pm
RogerM: I don’t think people are nearly afraid enough of small business.
Glen
Jul 11 2006 at 11:16pm
Economist who reach the upper levels in government are political shills. They take the proposed policies that their politcal masters want to implement and spray economic perfume on those policies. They take the proposed policies of their political masters’ enemies and spray economic stink on them.
RogerM
Jul 12 2006 at 9:14am
Swimmy, I wish they were as afraid of government as they are of large corporations.
Cyberike
Jul 13 2006 at 9:02pm
Omer K:
Why should we be helping the poor? Because inequality exists. There is unfairness in our political and economic system. This is real whether you choose to believe it or not.
The injustice (or lack of justice) leads to anger, leads to frustration. Some respond to those feelings with violence. If it costs something to help prevent violence, robbery, or murder, then it is in our rational self interest to pay those costs. We pay because it is easier to pay than to solve the underlying problems.
Omer K
Jul 15 2006 at 12:04pm
If it costs something to help prevent violence, robbery, or murder, then it is in our rational self interest to pay those costs. We pay because it is easier to pay than to solve the underlying problems.
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Spoken like a true socialist! Bravo!
Probably will never read this as its old now but..
Explain to me how it works before the 1960s? Before 1913? Anarchy and bloodshed on an unparalleled scale…right?
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