by Will Wilkinson on March 11, 2010
From Two Cheers for Capitalism, 1978:
And what if the ’self’ that is ‘realized’ under the conditions of liberal capitalism is a self that despises liberal capitalism and uses its liberty to subvert and abolish a free society? To this question Hayek — like Friedman — has no answer.
And yet this is the question we now confront, as our society relentlessly breeds more and more such selves, whose private vices in no way provide public benefits to a bourgeois order.
There. And now you can say you’ve read every past and future David Brooks column about libertarianism.
by Will Wilkinson on March 11, 2010
Somehow I’ve failed to blog a result about libertarians in one of Jonathan Haidt’s recent papers (with Jesse Graham and Brian Nosek, 2009 — you can request a copy here) on the relationship between political ideology and his five foundations theory of moral sensibility and judgment. (You can read up on that here.)
So here’s some background on the study. Haidt et al have set up a number of online surveys to test their hypothesis about the foundations of moral judgment. This one concerns a survey titled “Sacredness Survey: What Would You Do for a Million Dollars?” During registration, participants reported their political identity. An unusually high number of self-identified libertarians (over 1000 out of a sample of a bit more than 8000) took this survey, so they were able to say something about how libertarian moral judgments differ from conservatives’ and liberals’.
The survey asks participants to do the following:
Try to imagine actually doing the following things, and indicate how much money someone would have to pay you (anonymously and secretly) to be willing to do each thing.
They go on to say that you should assume nothing bad will happen to you and that you can’t use the money to make up for your choice. The survey asks how much money someone would have to pay you to kick a dog in the head, renounce your citizenship, get a blood transfusion from a child molester, and so on. Participants were given these options: $0 (I’d do it for free), $10, $100, $1,000, $10,000, $100,000, a million dollars, and never for any amount of money.
All right? So Haidt et al found that the results supported their hypothesis about liberals and conservatives. Liberals care most about the Harm/care and Fairness/reciprocity foundations and accordingly largely refused to make trade-offs on the items that reflected these concerns, but were more willing to perform actions that violated the three “binding” foundations — Ingroup, Authority, and Purity. Conservative concern was spread more evenly over the five foundations, and they were less willing than liberals to violate Ingroup, Authority, and Purity for money.
What about libertarians? Here’s what they say:
Because we had a large sample of libertarians, who are usually ignored in political-psychological research, we compared their sacredness reactions to those of liberals and conservatives. Overall, libertarians showed less refusal to violate the five foundations for money that did liberals or conservatives. Each of the five average never scores for libertarians was lower than the corresponding score for conservatives, and each was lower than the corresponding concern for liberals.
Further down they report:
A further novel finding of the present study was that libertarians had the lowest sacredness scores on all five foundations. This finding supports Tetlock’s predictions [see here] that free-market libertarians would be the least outraged and most open to contractualizing moral violations. The differences were particularly stark between libertarians and conservatives on the three binding foundations. Libertarians may support the Republican Party for economic reasons, but in their moral foundations profile we found they more closely resemble liberals than conservatives. [Emphasis added]
This supports what I’ve been saying for a while now: libertarians are liberals who like markets.
An interesting feature of the Sacredness Survey is that the set-up seems to assume that Purity/sanctity dimension is recruited to reinforce the other dimensions of the moral sense. When we come to find it disgusting to, say, kick a dog in the head, we’re using the Purity/sanctity foundation to amplify the force of our Harm/care judgments. It stands to reason that those with the least tendency to make judgments on the basis of the Purity/sanctity responses would also be least likely to find it intolerably profane to bring moral considerations into the cash nexus.
by Will Wilkinson on March 7, 2010
Daron Acemoglu and Pierre Yared find that:
increased nationalist and militarist sentiments, measured by military spending and size, are negatively associated with trade. A country is less likely to open up to neighbours if the country is also becoming more militarised, and trade between two countries grows less rapidly when both countries become more militarised.
I wonder if this supports the idea that bilateral trade increases between countries if both free-ride off the military spending of a third benevolent hegemon.
by Will Wilkinson on March 7, 2010
Classy, in an “I’d Rather Be Partial-Birth Aborting” sort of way.
by Will Wilkinson on March 7, 2010
Read Daniel Larison:
Whenever possible, I refer to the Iraq war as a war of aggression, because that is what it is and has always been. One thing that has often puzzled me about the reflex to declare victory in Iraq, as a Newsweek cover storydid recently, is that I don’t know what it could possibly mean to achieve a victory that anyone would want to celebrate as the result of a war of aggression. Tens and hundreds of thousands of Iraqis and thousands of Americans are dead. Tens of thousands of Americans are injured, some of them severely, and Iraq now boasts one of the highest percentages of disabled people in the world. Millions of Iraqis were turned into refugees or displaced within their own country. All of this has come about because of a war that did not have to happen. All of this has come about because of a war we started. It is bad enough that our government unleashed this hell on people who had never actually done America any harm, but it is unconscionable that any of us celebrate what has been done as if it were something good and worthwhile.
Bbbbbut Saddam! Later in the same post, Larison observes that the new regime seems to be reverting to the oppressive ways of the old one.
Every now and again the neocons chide the decadent American culture for encouraging perpetual adolescence. We are a nation of kidults! We should be more serious. We should act more grown up. Well, the adult thing to do in this case, the serious thing, would be to admit that our government, with the blessing of popular opinion, made a huge mistake and is guilty of an immense moral crime. But no. To recognize the war for what it is is to hate America. Why do you hate America, Larison? Why have you hardened your heart, Will? A heart open to love, a heart whose colors don’t run, would know the warm truth: that it is better to be homeless and legless under an unstable, externally imposed democracy than to walk around your house under Saddam Hussein. We did those people a big favor. Even the dead people. Even the people with one eye. Good for us! Sometimes you give and you give and you give and nobody acknowledges how generous you are. No one is grateful. That’s OK. We’re cool with that. At least we recognize our generosity. And at least we’re grateful for us. Greatest f*%#ing country in the world. Long may we reign.
by Will Wilkinson on March 6, 2010
I endorse the general gist of Bryan Caplan’s post on “Why Cronyism Doesn’t Explain the Free Market’s Unpopularity,” but I want to dwell a bit further on some things the post suggests.
Bryan writes:
I’ll admit that [the "hard left" is] often aware of the unholy alliance of business and government. But it’s naive to conclude that their real beef is with cronyism, not the free market. Strange as it seems, the hard left sees the unholy alliance of business and government as an argument for government.*
The asterix marks a footnote wherein Bryan continues:
The hard left argument, I guess, is that the weaker business is, the less able it will be to corrupt government. But can’t government be corrupt all by itself?
I’d say that the “hard left” argument is that the logic of business is the logic of exploitation and that unless there is a countervailing power, people will be exploited, which is very bad. So let’s have government act as the countervailing power. My puzzlement has always been this… If the government is already part of an unholy alliance with business, how is strengthening the hand of government supposed to help?
What I’ve found striking recently is the fact that public choice types and progressives often have very similar ideas about the unholy alliance, but have polar opposite ideas about democracy. The hard public choice view is that democracy all-but guarantees the unholy alliance. The hard progressive view is that only true democracy can prevent or defeat the unholy alliance. At least one of these views is wrong!
For my part, I think that though the public choicers do us a great service in pointing out many of the flaws of democracy, they tend to underestimate democracy’s overall value. As for the progressives, they tend to overestimate democracy’s potential because their theories of true democracy tend to be ridiculously demanding. True democracy ends up requiring something like equal shares before it can get off the ground. Which means that progressives either come to admit that true democracy can never get off the ground (true democracy just is socialism, and socialism is a beautiful but impossible dream!) or they develop an enthusiasm for distinctly non-democratic means of equalizing shares, such as revolution followed by the rule of right-thinking, well-meaning experts. But such means, as a matter of historical fact, have tended not to equalize shares or make democracy more likely.
An interesting commonality between the most extreme public choicers and progressives is that both see the logic of the status quo democracy driving us toward disaster. For the progressive, the unholy alliance generates widening inequalities bound to end in plutocracy. For the public choicer, the unholy alliance leads to the slow strangulation of the productive economy by the ever-swelling predatory state.
But the “mixed economy,” cronyism and all, works rather better than all that. Decent democracies are remarkably robust. My incredibly boring view is that the advanced liberal democracies work pretty well, but could certainly work a lot better. There are degrees of unholiness. The existing alliances between markets and the democratic state are only moderately unholy and could be made less unholy still. There’s ample room for improvements in constitutions, voting systems, the design of legislatures, and whatnot. Anyway, we aren’t doomed by the very logic of democracy, or by the failure of our democracy to much resemble a utopia of egalitarian public deliberation. I think if you develop reasonable expectations about human social life, you’ll see that democracy at its actually-existing best really is pretty terrific and that we’re doing just fine.
by Will Wilkinson on March 5, 2010
Despite my post about the troubles with GDP below, GDP per capita remains a very useful rough estimate of a country’s standard of living. In my happiness research paper, I included a section defending economic measures like GDP against the charge that measures of money reflect especially “materialist” priorities. On the contrary, I argued, measuring the money at peoples’ disposal is a way to not take sides in arguments about which values ought to granted the highest priority. Because money is not intrinsically valuable, but can be converted into countless things that people do value, income proxy measures like GDP honor the plurality of values by standing relatively neutral in debates about what we should care most about.
While reading this post by Adam Ozimek on Philly’s proposed soda tax, it occurred to me that the fact that taxes on soda and cigarettes seem paternalistic while taxes on income (i.e., taxes on paid work, mostly) don’t seem so paternalistic is a data point in favor of the idea that GDP stats are relatively value neutral when compared to, say, national happiness stats.
Of course, when you think of income taxes as taxes on paid work, they seem pretty perverse. The idea is just to collect money at the source, to take a cut of the individual’s overall annual haul to help finance government. The idea’s not to discourage people from working, or to compensate society for the externalities of working, in the way that soda taxes are meant to discourage soda consumption and compensate society for the externalities of soda consumption. But here’s a thought. Maybe when supply-side economics forcefully emphasizes that income taxes act as a kind of penalty on labor effort , it actually encourages soft-paternalist taxation by challenging our normal assumptions about the relative value neutrality of money-making. If we want to not discourage money-making effort, then what do we want to discourage? Carbon emissions? Sugar consumption? Luxury consumption? The tax money’s got to come from somewhere.
Suppose it’s correct to see the income tax as a not-really-neutral sin tax on labor effort. In that case, doesn’t an income tax then function as counterproductive and badly designed (because accidental) form of soft-paternalist intervention? Wouldn’t it be better to be more explicitly paternalistic and tax soda and transfats and carbon emissions?
Or would some other general tax, a consumption tax maybe, do better at raising adequate revenue while for the most part staying neutral on the question of how people should live? Or is the meddlesome part of the income tax its progressivity, which a flat income tax could avoid?
I raise these question not because I have well-thought-out answers, but because it is clarifying to me to try to raise them clearly. What do you think?
by Will Wilkinson on March 1, 2010
A lot of people are saying government is broken. They’re mainly saying it because the Democratic health care bill isn’t going to pass in a form that gives most Democrats what they wanted. The argument, in its general form, goes like this: There is this huge problem! My team’s favored solution to the problem is politically infeasible. So, politics is broken! When you put it like that, it’s evidently a pretty silly argument.
To get a better grip on the debate behind the debate I think you need to understand that big entitlement politics is about enacting policy that generates a kind of lock-in effect for a new power-shifting political equilibrium. Savvy political operators know that big entitlements, once established, create their own political demand. That’s why, for example, it was so important for the left to kill Social Security reform.
Regarding the sustainability of the American public old-age pension scheme, moving to personal accounts was and is an excellent idea. But it was so attractive to the pro-market coalition in large part because it was believed that widening the investor class to include everybody would, by giving the public a more direct stake in economic performance, limit the discretion of legislators to support growth-hampering regulatory and redistributive policies popular on the left. (Whether it would actually have this political effect or not is an open question, but lots of folks both left and right thought it would.) In any case, defeating the reform proposal was easy enough, since Social Security was pretty effectively designed to be democratically untouchable.
Similarly, it is widely believed by folks both left and right that a huge new health entitlement, once firmly established, would generate its own support, and shift the balance of public opinion toward more a thoroughgoing social democracy (i.e., toward socialism) and away from limited government and relatively free market institutions (i.e., away from liberalism, properly construed). From this perspective, the fact that a party decidedly but temporarily in the minority is able to defeat a measure that would have profound, long-term effects on the basic structure of the United States’ institutions is very good evidence that the system works! The unsustainable path of Social Security and Medicare goes to show just how dangerous this kind of large-scale policy lock-in can be, and how important it is to have a system that does not produce fundamental changes to the de facto constitution with each peak and valley of the political business cycle.
If you’re worried that the Democrats’ current inability to convert control of the Congress and the presidency into massive structural reform means that our political system can’t do anything at all, you just need to relax and wait until Obama is forced by the large forthcoming GOP gains to set his sights lower. You may be pleasantly or unpleasantly surprised by how much can be accomplished when a more conciliatory strategy is the only option.
And, as Reihan reminds us in an intelligently hopeful new Forbes column, government is not the solution to everything. So even if the political system is broken, America’s entrepreneurial culture (our greatest asset, IMO) may be able to route around the damage. If we let it.
by Will Wilkinson on March 1, 2010
David Henderson has an excellent essay on “GDP Fetishism” up at EconLib. Of the problem of valuing government spending, he writes:
Take the first inaccuracy—the valuing of government-provided goods and services at cost rather than at market prices. Many government programs actually destroy value rather than create it.
This highlights the fact that knowing how much the government spends (as a percentage of GDP, say) is to know something of questionable significance. Henderson talks about the waste created by the TSA. More generally, the United States spends a spectacular amount of money on war ships, fighter planes, and bombs. Most of this is simply unnecessary for the security or defense of the United States, and so amounts to little more than a combination of upward wealth redistribution and throwing money in a hole. That’s domestically. (I’ll pass over the problem of bringing the lost lives of bombed foreigners into the equation.)
Now, we dynamist market-liberal types are right that the government does many things, such as primary education, that competitive markets could do better and more efficiently. If all government spending on education became equivalent private spending overnight, GDP would stay the same (in the short term, before gains in education quality started to pay off in terms of higher productivity), though people would be better off. However, government spending on education, as inefficient as it may be, is giving people something they want and directly benefit from. Much (most?) military and security spending is not like that. My sense is that, despite the U.S.’s historically relatively modest level of government spending, the composition of U.S. spending is such that U.S. taxpayers get less of value in return for their tax dollars than do taxpayers in many places with higher taxes and higher levels of government spending. Which is to say that when using GDP per capita as a proxy for welfare, the U.S. comes off better than it should relative to, say, Canada or Sweden.
Now, one could argue that U.S. military spending and hegemonic U.S. military power, makes it possible for the Canadian government to spend on health-care, from which the Canadian people derive some benefit (even if the service is not provided as efficiently as it could be), rather than on aircraft carriers, from which the Canadian people would derive basically no benefit (since the Americans have already taken care of it). I think this is almost certainly true, but it’s just another way of making the same point: Canadians are better off and Americans are worse off than their GDP stats suggest.
If one additionally takes into account things like the U.S.’s unusually high level of spending on keeping its citizens in prison cells (which we could do much less of without getting more crime), it becomes even clearer that U.S. GDP figures overestimates the U.S. standard of living relative to other wealthy liberal democracies. The composition of spending matters.
The U.S. is an notable anomaly in the happiness data. Average self-reported life satisfaction rose with GDP per capita over the last several decades in almost all wealthy liberal democracies, but not so much in the U.S. The idea that the unusual composition of U.S. government spending gives Americans unusually poor value for their tax dollars might help explain this.
by Will Wilkinson on February 19, 2010
That’s my new column in The Week.
I really struggled with space constraints on this one, and I think I may have done a better job laying out the progressive point-of-view than in rebutting it. But that’s okay. I’ll be happy if this helps anyone understand the ins and outs of the issue a bit better.