The Libertarian, the Conservative, and the Progressive
Think of three points on an ideological triangle:
1. Point L, where you believe that markets are effective at processing information and solving problems. This position is to take a radically pro-market view, and to let markets fix their own failures.
2. Point C, where you believe that tradition incorporates the evolved use of information to solve problems. This position is to be very cautious about overthrowing existing institutional arrangements.
3. Point P, where you believe that expert technocrats should be in charge. You are comfortable with throwing out tradition and markets in order to cede power to experts.
I’ll apply this framework to some people and to some issues.Tyler Cowen is a mix of L and C. He is too C to go along completely with the brute logic of Robin Hanson or the bumptious enthusiasm of Bryan Caplan. But Barack Obama has managed to offend Tyler on both the L and C points, as you can see in the latter part of this interview with Matt Welch. I also find myself somewhere between L and C.
Brad DeLong and others on the left of center in the economics profession are examples of point P. They seem to have no doubts that expert technocrats can outperform markets in every situation. In fact, the entire mainstream economics profession is built around point P. When you write a paper, if you don’t include a section on “policy implications” (i.e, how a benevolent technocrat would use the findings in your paper), the paper is considered incomplete.
Take the issue of health care. The left is sure that markets fail and that technocratic government is the solution. Thus, we have the proposal for IMAC, an independent set of technocrats to run the health care system.
I am in an awkward position on health care. My L side wants to abolish health insurance as we know it, and replace it with out-of-pocket spending and some yet-to-emerge form of catastrophic insurance. See my book. However, my C side recognizes that both in the U.S. and elsewhere in the industrial world, third-party payments for medical services are extremely popular. Getting from where we are now to where I would like to go is a challenge.
Or take the issue of the Fed. For a true L, free banking is the best approach. For a true P, a strong independent Fed is best. For a C, we tend to take the Fed as given and the question becomes how best to see it governed and operated.
Finally, take the issue of competitive government. For a P, there is no reason to have such a thing. Concentrated political power is no problem–just make sure that you have the right benevolent technocrats in power. For an L, radical solutions are the answer. Charter cities. Seasteading. Let a thousand nations bloom.
As an L who is also a C, I am skeptical of these radical solutions. Existing cities and communities have evolved considerable institutional wisdom. Although it is difficult to fight entrenched political power, I suspect it is easier to make existing governments more competitive than to launch entire new communities. But I certainly have nothing against the latter approach.