Monday, February 18, 2008

Libertarian Philosophy, Economics, and Hegemonial Free Trade: 3rd in a Series

Introductory Comments 

If you've read the first two articles in this buggy series, you should be well situated to grasp the twists and turns of today's argument.  Divided into two major parts, it explores for the first time the basic philosophical premises of mainstream Libertarian thought --- not just about economics and free-markets, but what the good "society" is (a suspect term, you understand, in Libertarian thought --- a misleading, mystifying collectivity with no anchoring in substantive reality) and the roles of free-markets and limited government as instrumental creations of self-contained, self-centered, wholly self-seeking individuals who use them for their own egocentric reasons. 

The argument unfolds in two parts. 

Part one explores some of the key philosphical ideas of Liberetarian thought, including the ontological assumptions that only self-seeking, fully rational individuals with inherent rights to property and free choices about their lives are the only real social agents with a substantive rooting in existence and what that all means for how Libertarians understand such reified abstract aggregates like the "nation-state" and "patriotism" and the shared rights and alleged "duties" of citizens in a "country" like the "United States" toward one another.  Why the quotation marks around these terms?  To avoid the mistakes of self-deluded muddle-heads who think that these aggregates are anything more than convenient utilitarian coalitions formed by self-contained individuals to serve their specific egocentric purposes and hence nothing more than handy legal fictions.  No need to say anything more at this point.  The argument as it advances in this part should be fairly easy to follow, whether you agree with it or not.

Part two is an elaborate analysis of one recent example of Libertarian thought --- this about free-trade and why an American citizen who prefers buying goods made by strangers in Detroit than made by strangers in Mexico or Japan or elsewhere is, at bottom, nothing less than a racist.  The person invoking this harsh term, as you'll find, isn't some off-the-wall kook, rather a prominent Libertarian economist highly regarded in all mainstream Liberrtarian circles.  Prof bug's aim here is to use this example to highlight some of the intellectual pitfalls and dogmatic rigidities of Libertarian thought, some of which, remember, the buggy guy has admitted to find attractive.

PART ONE: THE CHIEF PREMISES OF LIBERTARIAN THOUGHT

Strange as it might initially seem, a good point of entry into the intellectual complexities and philosophical premises turns out, surprisingly enough, to note that there is actually a tiny movement in American politics called Left-Wing Libertarianism. What? Is that possible without flagrant elf-contradiction? Not in the view of mainstream Libertarian opponents. They think that these left-wing Libertarians are a self-contradictory hodgepodge, a strained and unconvincing effort to link a preference for free markets and limited government to egalitarian redistributive principles . . . the sorts of things associated in mainstream Libertarian thought as collectivist, socialist, and thoroughly dangerous. Understand the mainstream rejection of this left-wing heresy, and you'll begin to get a good working idea of what the core substantive philosophical principles of libertarian thought happen to be.

Posted by gordongordomr @ 09:19 PM PST [ continue ]

Friday, February 15, 2008

Libertarian Philosophy, Economics, and Hegemonial Free Trade: 2nd in a Series

PART ONE: WHAT IS LIBERTARIANISM?
Libertarians, As It Happens, Are Only One of Several Movements
 in American Conservatism

At Least Four Different Intellectual Tendencies Exist

Libertarians, as it happens, are only one  of several intellectual movements with grass-roots followings in American Conservatism these days.  No surprise really.  In effect, Conservatism operates politically as an umbrella term: at least four large distinctive groups, each with its own intellectual theorists and mass grass-roots support, fall under that term's heading.  At times, for all their philosophical differences, these various factional groups coexist fairly effectively.  At other times, their relationship is far more strained and marked by irreconcilable policy positions.  Sometimes, as at present, it is full of frictions and mutual backbiting and recriminations as to what is genuinely Conservative or not. 

The names of these diverse factional movements: Libertarians, Traditional Conservatism of, say, the William Buckley National Review sort, Moral Majority Christians, and NeoConservatives . . . the latter former Liberals who were and remain appalled by the radical cultural changes in American life spawned by the 1960s, by widespread anti-Americanism on the radical left and in universities, the corollary left-wing hostility to American power and behavior in the world, and by constantly failed social policies to intervene in American life that go back to the 1960s as well. 

Focus First on Their Commonalities That Keep the Republican Party from Splintering Apart

Philosophically, what these four distinctive factions have in common derives from a shared ideological hostility, several decades old by now, to socialist and left-wing Liberal philosophies about the different roles of government and free markets in American life. 

  • For many of them, these differences go back to the New Deal era of Roosevelt policies of the Great Depression in the 1930s and, on a theoretical level, to all versions of Keynesian economics. For other Conservatives, their rejections extend back to the mid-1960s and the breakthrough influence of Senator Barry Goldwater and his rejection, vocally and vividly expressed in his failed presidential campaign of 1964, of all compromises with the economic and social policies not just of FDR, Truman, JFK, and Lyndon Johnson on the Democratic side, but also to the coming-to-terms compromises with them of the Eisenhower and Nixon administrations.  Yet another new Conservative breakthrough-movement didn't emerge until the late 1970s and early 1980s among Evangelical Christians, increasingly appalled by the cultural changes wrought after 1968 in American life, almost all of which were at odds with traditional American beliefs and moral codes, themselves partly religious in inspiration --- above all, what can be called rightly the Protestant Ethos and, whether in its religious or secular versions, individualism, self-reliance, and a strong sense of personal responsibility for your life and social behavior.

There are, as it happens a couple of corollary philosophical antagonisms that almost all Republicans generally share that keeps their strained coalition from shattering apart

  • A common hostility to all redistributive egalitarian policies that the Democratic Party has embraced and implemented since 1930s and, more specifically, since the Great Society era of the 1960s.  This powerful, principle-based aversion, observe quickly in passing, flourishes everywhere in Republican ranks no matter how limited virtually all Democratic policies have been in social and economic matters have been, at any rate compared with almost all other industrial democracies . . . especially in the advanced regulatory- and welfare-states found all over the West European continent. 
  • Another mutually agreed upon hostility to their partisan Liberal opponents also goes back to the 1960s.  In a word, even among many Libertarians, the various Conservative movements in Republican ranks have combined to launch a sustained counter-attack against the radical cultural changes in American life that came out of the 1960s --- above all, to be specific, launched against the politically correct dogmas and identity politics that have become powerfully entrenched in American universities since the late 1960s as well as in the mass media and entertainment industries, and that have spilled over into wider American life in diverse ways: most of all, in declining respect for institutionalized authority, in over sexual behavior, and in growing secular hostility to traditional religious mores . . . not to forget over anti-Americanism expressed by the radical left.  As we'll see, not all Libertarians are unhappy with each of these changes --- especially in sexual matters. But they do not usually push their opposition to a rupture-point with the other Republican movements, if only because all Libertarians are appalled by identity-politics and politically correct dogmatism in university life and in the media.

Politically, too, it goes without saying, all this shared intellectual hostility shows up especially in national elections.  As a practical matter, despite their mutual differences and their frequent factional attacks on one another, all Republicans tend to rally and . . .

  • Vote for their party's candidates, whether or not the different factions like, say, the presidential candidate or the party's platforms.  Even then, less unity shows up for the local candidates on the Congressional level.   

Otherwise, Though, Clear Philosophical and Activist Political   . . .

 . . . tendencies separate these different Conservative movements.  The upshot is a loosely united, often unstable, and frequently bickering political party.  If it weren't for these shared basic hostilities to the enemies on the Left, the contemporary Republican Party would probably splinter apart.   And even with these common enemies, the party would probably disintegrate into different political parties if the US had an electoral system similar to West European ones, as, say, in Germany where the political right encompasses Christian Democrats, Christian Socialists (Bavaria), some neo-Nazis (fortunately small in number), and the centrist Free Democratic Liberal Party . . . the latter a swing party of libertarian tendencies, usually in coalition with the Social Democrats on the left or Christian Democrats (and their Bavarian wing) on the right.  Or, again, as in France where four or five different political parties, each with their own leadership, form a loose coalition for national elections and expect to share posts in any government, but otherwise coexist very uneasily with one another.

McCain vs. the Die-Hard Right

Posted by gordongordomr @ 03:37 PM PST [ continue ]

Sunday, February 10, 2008

Do Free-Market Libertarians Understand the Need for Liberal Hegemony? 1st in a Series

A FEW INTRODUCTORY COMMENTS:

Even though Prof Bug has been busy preparing the final article in the series on the revitalized economic performance of the small Scandinavian economies --- all advanced welfare-state systems, with high taxes, high social spending, and extensive market regulations in both labor and product markets --- he decided, earlier this week, to take some time off and post a lengthy comment at EconLog . . . a good libertarian economic blog, run by two economists: Arnold Kling and Bryan Caplan. The subject? Does extensive trade and exchange across borders --- in goods, services, investment flows, technology transfers, and at times mass movements of peoples --- spontaneously occur on its own, unless blocked by governments for a variety of reasons . . . or does it require, especially on a global scale, the existence of a dominant states, a hegemon?

Kling's Brief Answer

Highly unusual for an uncompromising libertarian, Kling --- a University of Chicago-trained Ph.D. and prolific blogger --- argued in his short think-piece that extensive trade does require a dominant state, no two ways about it. His argument was brief, you understand; and it proceeded in a fast, top-skimming manner that showed little grasp of the extensive literature outside economics that international relations specialists have developed for three decades now. Still, give credit where it's due. Kling's swift-moving commentary was laudable, an effort to prod libertarian devotees to be open-minded about something they are largely naïve about: how any extensive global or regional trade-system, whether past or present, depends heavily on the more basic military and security system of hegemony.

More concretely put, if --- to use terms Kling didn't --- a far-reaching system of trade across numerous states in a region or worldwide has ever emerged and lasted for decades or longer, it has almost invariably done so if a dominant state existed and was willing to substitute its superior military forces, diplomatic influence, and economic and financial power for the absence, in international life, of effective, institutionalized world government. A world government has never existed. Very likely, it never will. Someone, though, has to create the public goods --- like the protection of private property and traders --- that only government can do domestically. Hence the need of a dominant state to do this. One way or another --- whether through conquest and colonization or maybe the use of subordinate allied states or by creating international institutions like the WTO today --- the dominant great power will, at a minimum, have to open trade routes and police them against predatory states or brigands or terrorists or pirates, while providing financial and economic inducements to potential great power rivals to play along with the rules that the hegemon has shaped and sought to maintain for its own self-interested benefits.

An Ambiguous Concept

Note quickly that a hegemon is a Janis-faced concept . . . something Kling's article only superficially alludes to. It really refers to two very different ways that a dominant state in a region or world-wide can use it superior military, technological, and economic and financial power to drive ever greater trade in goods, services, investment flows, and technologies across state-borders.

  

 

Posted by gordongordomr @ 02:41 PM PST [ continue ]

Thursday, February 7, 2008

The US Health-Care System, Comparatively Viewed

Introductory Comments 

Busy busy for days now, sedulously running down some more data and preparing some charts and tables for the last buggy article in the series on Scandinavian economic performance, prof bug has taken time off every now and then --- if you want, some R&R for the obsessive, hyper-charged mind --- by posting at a couple of very good economic web sites. 

Where Prof Bug Has Been Posting

One of those economic web-sites you already know: it's the Marginal Revolution where the series on Scandinavia originated in some exchanges prof bug had with some Scandinavian posters in the forums there. The other site, interestingly, is also libertarian and is one of the two most empirically grounded economic blogs that can be found on the web: Mark Perry's outstanding Carpe Diem. A professor of business finance and economics at the University of Michigan, Mark Perry, as it happens, is the former pupil of Tyler Cowen, the wide-ranging, unusually cultivated economist who runs the Marginal Revolution, 

Odd, this coincidence ---no? And odd in another way too. 

Prof bug, you see, is not a libertarian, a designation for those free-market champions who essentially favor a laissez-faire form of free-market capitalism, with any government intervention in the economy that goes beyond the basic public goods that Adam Smith himself signaled out as needing government provision politically motivated and destined to backfire and make market outcomes worse in the long-run, not better.   Smith mentioned four such public goods, which self-interested free-market agents --- workers, consumers, firms, and investors --- wouldn't likely provide on their own, owing to what would now be called "collective action" problems like free-riding: namely, a legal system and police that protect the lives and property of the citizenry, the creation of a military and national defense, the supply of basic infrastructure like city roads and ports, and maybe basic state-run education. No need to elaborate here. The next article --- already done, just in need of formatting for the web --- will deal at length with another libertarian economic blog, EconLog, and the naivete of standard-model libertarianism when it comes to international relations: not just in military, diplomatic, and security matters, but also in trade, investment flows, and technological transfers . . . all of which have, potentialy, large security-spillovers that might alter the distribution of economic and military power between countries. 

So, historically over the millennia and since WWII, trade in goods, investment flows, and technological transfers (if any) have flourished either between long-standing military allies but not others, or when there has been a dominant state --- a hegemon, whether an empire that conquers other countries and colonizes them or, starting only with the industrial revolution and first a limited British hegemony in the mid-19th century and a more extensive one under US auspices since WWII that eschews colonizing other countries, has no territorial objectives, and uses its vast economic, financial, and military power to expand international trade in rule-bound institutional ways: think of the World Bank, the WTE, the IMF, and so on.  We can call such a dominant power a liberal hegemon.

To repeat, though, that's for later.

Enter Today's Subject: the US Health-Care System Comparatively Viewed 

Right now, the buggy comments that follow deal with the problems of the US health-care system, in their own right but also, and more to the point for our concerns, as compared with the Canadian and West European state-run health-care systems. Keep in mind as you start to read through those comments that they appeared in a forum where a couple of dozen others had already posted their own views in reply to Mark Perry's stimulating commentary. Keep in mind too, as the next section heading stresses, that we're dealing with the private insurance system of health care in the US, not that of government-run Medicaid, Medicare, and Veterans' Hospitals and Clinics . . . all of which public systems, surprisingly, account for about 40-50% of the huge medical expenses in this country yearly. To clarify, in the private and public spheres together, we spend about 16% of GDP on health-care. The Canadian and West European systems spend roughly anywhere from 8-11% of their own GDP output.

Posted by gordongordomr @ 07:38 AM PST [ continue ]