Speak the Truth, as Long as You Don't Think It's Persuasive

Three groups are filing an FEC complaint against the folks putting out the SwiftVets ad. I think the ad is extremely effective. I have no way of independently verifying any of the claims therein, but it hits the right buttons and made me pretty willing to believe that Kerry plays with his war record to suit his political aspirations.

So, naturally, the ad, and the “soft” money that paid for it, is being interpreted as an attempt to influence the presidential election. This is, I understand, illegal. However, Mike Rusell from Swift Boat veterans for truth maintains:

The ads are not meant to influence the presidential election. The ads are meant to tell the truth about John Kerry's service record so people can make their own decisions.

Now, surely this is a lie. The ads ARE meant to influence the election. The point is, Mike Russell shouldn't have to lie about this, but McCain/Feingold makes him a liar.

No doubt the ads “are meant to tell the truth about John Kerry's war record.” Suppose you are one of the men making a claim in the ad and you speak truly. The difference between what you know and what Kerry claims may be sufficient ground for thinking Kerry disqualified for office, and, suppose, on this basis, you wish for him to lose the election. You believe that if others had your information, then voters might wish to alter their estimation of Kerry's fitness for the presidency. The people with whom you have shared your knowledge about Kerry's record and who have financially supported the ad campaign share your desire that your knowledge of the matter be made available to broader public.

Isn't it just disturbing that this may in fact be illegal? If I publish a scientific article that cites empirical data in order to refute a competing theory, I also intend this to have some impact on the opinion of the scientifc community. I intend to influence their beliefs about what theory to support. This may in fact be my main motivation for gathering data in the first place: I want to persuade. This is, of course, OK.

But, strangely, in the political arena, which relies on argument and the free play of claims and counter-claims for its proper function, publicly airing what one believes to be true can under certain circumstances be illegal. Doesn't it seem that if one want to tell what one believes to be true, it shouldn't matter where the money comes from?

I want to see the counter-ads. I want to see other vets saying that Van O'Dell and Jack Chenoweth are liars, and telling me why. I want to hear eyewitness reports about the time John Kerry saved the life of a dying child with one hand while fending off VC with a machine gun in other, all while shouting brilliantly improvised orders despite the blood running into his eyes. Even if it takes soft money to do it.

Anyway, was it really Kerry's best idea to push his stint in Viet Nam (or Cambodia, or wherever he was) to the front? Sadly, I think it was.

  • You’re probably just going to make fun of me for this, but I find this sort of post to be indicative of more religious-style faith in the capitalist enterprise. I’m enough of a capitalist to believe that it’s the best system currently, and certainly preferable to the failed attempts at creating a Marxist state of the 20th century. But, look, capitalism is an organic, human system; it has no access to extra-human power or certitude, and I think that unless you believe that the system is somehow ordained by God, there has to be room within your ideology to say that capitalism has failed in one fashion or another, or at least that it has created an undesirable outcome. And not merely that it’s failed because we aren’t faithful enough to it, either; it is libertarian holy writ that the economy can’t fail on its own, but only because the government manipulates it too much. You get a kind of evangelical zeal from people proclaiming that, no matter how little the government interferes, the fact of any government interference at all means that undesirable outcomes can be blamed merely on impediments to free markets but not to the markets themselves. And that kind absolutism, it seems to me, is contrary to the nature of human systems and reality.

    To your great credit, you are willing to admit to less desirable outcomes currently, and I think are less doctrinaire than a lot of your ideological comrades. But I still find a dismaying fidelity to the idea that the free market, on a large enough time span, produces no wrong, and again– that’s theology. Discrimination and our critical capacity tend to rule out those kind of blanket rules. I also find the standards of evidence for judging the capitalist model to be very different from those used when judging un-capitalism. This is something Megan McArdle (who I care for a great deal) does constantly. She’ll point to poverty in Havana as evidence that command economies don’t work; but poverty in Baltimore is just the system working itself out. One is dispositive of failure in the entire system; the other is just a hiccup– and probably one caused by liberal attempts to correct for that poverty. The problem becomes that you end up so bent on finding the way in which capitalism is ultimately the path to justice and socialism the path to misery, you become blind to contrary evidence. I think Megan has a great and discriminating intellect but I question whether there is any evidence that could compel her to think “In this situation capitalism has failed.” But then, that’s just me.

    Of course, like all teleology, the truth of your philosophy will probably come out someday. Just not in our lifetimes.

  • Freddie, I just don’t see how you get a kind of religious commitment to capitalism out of this post. I don’t think markets just exist. I think markets exist in the context of cultural, legal, and political institutions that define the rules of the game. I’m an institutionalist, and I think that came across in the post. (My positive political economy is Hayek + North + Coase + Buchanan.) Not only do I think economies can fail on their own for lots of reasons, I think one of the biggest problems in the world is that the cultural and institutional antecedents of complex capitalist markets never develop at all. Capitalism depends on a complex and precarious institutional structure. My point in this post is that elements of our economic system have indeed been failing, and some of them are markets, and these markets are largely defined and bound by regulation. I don’t think our extremely advanced financial markets can even exist in the absence of a web of regulation, and these markets generate enormous wealth. Markets can work better or worse, and I am wholly open to regulation that creates markets that might not otherwise exist, or improve the functioning of preexisting markets. I just don’t think I believe what you think I believe. In the case of the current series of small disasters, I think the case that ill-considered regulation has shaped the relevant markets in perverse ways is extremely strong. There is no one “capitalism,” just as there is no one “democracy,” and some of versions work better than others. I am in favor of a well-but-lightly regulated, and therefore dynamic and flexible, entrepreneurial capitalism, and against managerial dirigiste forms of capitalism. The evidence in favor of this, in terms of wealth creation, is overwhelming. I simply don’t understand your insistence on treating well-grounded social scientific conclusions as theology.

    • Greg N.

      “(My positive political economy is Hayek + North + Coase + Buchanan.)”

      Gary North? I’m disappointed, Will.

      • Duh. Peter North.
        http://www.peternorth.com/

      • I’m pretty sure Will meant Douglass North, but the Peter North thing was funny.

      • Greg N.

        Gil,

        Oh, DOUGLASS North! I thought he meant Christian Reconstructionist and Y2K wacko GARY North! Thanks for clarifying.

  • Craig

    ” . . . as if the story is that dissatisfaction with a kind of laissez faire we do not have may be generating demand for basically the kind of dirigisme we’ve already got.”

    Brilliant – best thing I’ve read all day.

    On the bigger picture, free markets require a public that sees them as both efficient and moral. The latter I think is much the more important part of the equation.

  • Dain

    The American’s committment to the free market seems weak at the abstract and operational level, when confronted with survey quesitons, etc. But at the personal level, i.e. the rich cousin or the friend who runs a business, Americans are fairly sympathetic to these “ideal types” and their perspectives, and enmeshed in a system they don’t really mind when all is said and done.

    Or so it seems.

  • I agree with Craig. An excellent post in many ways.

    Forgive me if this comment seems more akin to what you might see on Flikr. 🙂

  • muirgeo

    “When these markets stumble, it’s just a rookie mistake of political economy to see that as problem with markets, per se, rather than as a problem with the way regulation and government institutions happen to have structured those markets and thereby structured the incentives of the individuals and firms that act within them.” WW

    I think Joseph Stiglitz states what we see too often coming from the “free-marketeers” side of the debate as exemplified in your post; “…but that is partly the point: free-market rhetoric has been used selectively – embraced when it serves special interests and discarded when it does not.”

    From his “THE END OF NEO-LIBERALISM? ” paper.

    In other words all the good stuff that happens in the economy is because markets work but when something goes bad it’s obviously an issue of overregulation.

    But the facts are the Republicans have generally controlled the big picture economy issues ever since Reagan. Regulations (Glass Steagall Act ) have been cut not increased. Governmental functions (the Fed being the big one) have been privatized. And it’s been a relative disaster and IMO unfair as these inflationary policies tend to favor wealth accumulation on the top.

    And as our system is set up decreased regulation and oversight sends the free marketeers to actually seek MORE governmental favors and treasury dollars and favorable policy. ( See: The Argument for Preemptive Redistribution
    July 17th, 2008 by Will Wilkinson)

    So bottom line is people are losing faith in the idea that simply deregulating the markets or privatizing government functions is a good idea. I think they are understanding that GOOD regulation is better then NO regulation.

    And finally if the media really reported how the economy is run, how it is influenced by wealthy and how the privatized feds inflationary policies have not only transfered what wealth we do have to an elite minority but also bankrupt our country they’d be PO’d and they’d be calling for nationalization of our monetary system.

    http://www.monetary.org/

    “Money exist not by nature but by LAWS”
    Aristotle

    “So lets make good ones!”
    me

    Oh yeah and one other thing… Damn why the super small script?

    • Renato Drumond

      I think Joseph Stiglitz states what we see too often coming from the “free-marketeers” side of the debate as exemplified in your post; “…but that is partly the point: free-market rhetoric has been used selectively – embraced when it serves special interests and discarded when it does not.”

      So you think Will’s defense of free market simply serves special interests? Seems like ad hominem to me. You can’t conceive that someone defend free market on good faith?

      “In other words all the good stuff that happens in the economy is because markets work but when something goes bad it’s obviously an issue of overregulation.”

      I don’t see anything like this on Will’s post. He observes that we don’t live on a ‘pure’ free market economy, and to understand this is important to make a realistic analysis of american economics .

      “Governmental functions (the Fed being the big one) have been privatized.”

      What do you mean by saying that Fed was privatized?

      “And it’s been a relative disaster and IMO unfair as these inflationary policies tend to favor wealth accumulation on the top.”

      Here isn’t the better place to discuss monetary policy, but some points:

      1- Inflationary policies are policies, and policies are government decisions.

      2- The inflation rate of United States isn’t high since Volker’s stabilization plan:

      http://www.miseryindex.us/irbyyear.asp

      3- In general, but not as a rule(sse, for example, Paul Vocker) free-market oriented economists are more concerned about inflation than ‘interventionist’ economists. So I don’t see your point here.

  • muirgeo

    “,,,so that we can pinpoint the most likely institutional causes of the recent gloom and effectively focus our reforming zeal.” WW

    So what IS wrong? Which regulation busted the bank? Tell me one. What other possibilities are there? Was it over taxation… nope those were cut. Was it under-spending…. nope that was increased. Was it over-saving… nope that’s been almost negative. Was it increasing federalization … nope if anything way more government programs have been privatized.

    Here’ s my answer to a big part of the puzzle; easy credit/ fed policy/ deregulation of the finance and banking industry… those are the big issues along with generalized incompetency, corruption and graft exploding under the current administration.

    http://en.wikipedia.org/wiki/Image:Components_of_the_United_States_money_supply2.svg

  • muirgeo

    “Here isn’t the better place to discuss monetary policy, but some points:

    1- Inflationary policies are policies, and policies are government decisions. ”
    Renato

    So you kinda make my point. Any policy is a government policy so even if it’s a policy pushed for by the “free marketeers”, their lobbyist or the Republicans it’s always the governments fault. Obviously a bogus argument.

    That is basically the Republicans policy to get in there and destroy government bureaucracies to show how poorly they function… and to make a killing in the process of doing so. And as I’ve always said why would you want some one who doesn’t believe government can work running it?

    I guess I’m saying the argument is kinda like me saying, “well we’ve never had TRUE COMMUNISM so you can not argue that communism failed.”

    Free market failure is an abstraction because free markets are an abstraction. As soon as you have a money system there really are no free markets. The goal of the “free marketeer” is to approach as free a market as possible…. the faith people have lost in the “free market” is that moving towards that goal is always a good idea as over and over again the results are not so good.

    People realize that markets need oversight. Allowing banks to offer complex financial instruments and unlimited credit is not a good idea. It was a policy decision, (actually under Clinton) but it was one the “free marketeers” argued for.

    Here’s my solution. Let there be both “free markets” and well regulated ones. Let Wall Street firms have complete freedom with the one requirement that they have NO backing of the US government or Treasury in any way what soevery except for the usual access to infrastructure and courts etc that their taxes pay for. They have to raise their own capital, insure themselves, oversee themselves ect. Let people dabble in those markets and exchanges as they wish. But let there be another one where banks have the backing of the FDIC and where very strict rules and protocols are followed and good oversight is the rule.

    Put those two side by side and you will see which prospers. You will see why we are a nation of laws not of men. You will see why we are a nation of rules and not of anarchy. And regarding money you will understand why Aristotle claimed, “Money exist not by nature but by LAWS”.

    So Will is right in one sense blaming free markets is bogus as the concept itself is bogus but the idea of blaming policy is likewise bogus because there must always be policy and the debate ultimately is a relatively boring one about which policy and which laws and which regulations works best. And people are figuring out that what’s important is not the quantity of policy but the quality. Less is not always more.

    • Renato Drumond

      “So you kinda make my point. Any policy is a government policy so even if it’s a policy pushed for by the “free marketeers”, their lobbyist or the Republicans it’s always the governments fault. Obviously a bogus argument.”

      It’s not bogus to point out that a government policy is government’s fault. What’s bogus is to say that it’s free market’s fault to achive something that is government’s function.

      “That is basically the Republicans policy to get in there and destroy government bureaucracies to show how poorly they function…”

      I don’t buy manicheistic argument that put some side as ‘evil’, without conceding good faith. I’m pretty sure that corrupt Democrats exist too.

      (Classical) liberal tradition is about institutions that make politicians to act on certain way, not about picking the right ones.

      “And as I’ve always said why would you want some one who doesn’t believe government can work running it?”

      Good government function isn’t about believing it will function, it’s about make it function well. And to believe that something which doesn’t work will not work is actually a good thing.

      For example, a very sick person who’s not afraid to die and because of this never go to the doctor is probably on a worse situation thant someone that don’t ‘believe’ he will resist and because this starts a treatment. It’s true that we can have some positive feedback because of our beliefs, but it doesn’t mean that because we want that something will be true, that thing will be true.

      “Free market failure is an abstraction because free markets are an abstraction.”

      Yes, it’s true that free markets are an abstraction, but it doesn’t mean that it isn’t a useful concept. To call some situation as ‘free market’ and ignoring that it isn’t doesn’t help to solve anything.

      “As soon as you have a money system there really are no free markets.”

      You’re right about fiat money, but it’s not true on early stages of money development. Even today, money is a phenomen that governments control very poorly.

      “The goal of the “free marketeer” is to approach as free a market as possible…. the faith people have lost in the “free market” is that moving towards that goal is always a good idea as over and over again the results are not so good.”

      The only free-market thinkers that procede this way are Rothbard and its followers. Neither Hayek, Adam Smith, Friedman, Buchanan or even Bastiat talk like this description.

  • goof chewy

    Will Wilkinson said: “Gosselin maintains that “most people” in the U.S. think there is something out there called “the free market” that operates without “government meddling. I’m not really sure that most people think that, but it seems Gosselin does…”

    You’re evidently unaware of such pro-free-market books like Larry Kudlow’s “American Abundance: The New Economic & Moral Prosperity” and Brink Lindsey’s “The Age Of Abundance: How Prosperity Transformed America’s Politics and Culture”, both of which argue that the alleged “great” American economy of the past 30 years was the result of the American public’s support of free market policies. (Brink Lindsey, btw, is, like yourself, a member of Cato’s staff).

    Will Wilkinson said: “We are lucky, I think, to have intelligent, highly professional planners…but the housing ‘bubble’… and the historically high price of gas, which is to a large extent a function of the low value of the American dollar, probably has had a lot to do with the policies chosen by our monetary central planners. Failures of government planning don’t discredit free markets. Rather, they suggest free markets might be worth trying some time.”

    Holy cow, does this need to be explained all over again? It was the deregulatory legislation of free-market towel-boys like Phil Gramm, aided by the free-market think tanks (repeal of the Glass-Steagall Act; the passing of the Commodity Futures Modernization Act) which allowed those “intelligent, highly professional” Fed Reserve planners to destroy the entire economic system in the first place. Do these words from free-marketeer Alan Greenspan ring a bell? “The Federal Reserve chairman, Alan Greenspan, urged Congress today to encourage the growth of complex financial contracts known as derivatives…United States laws impede its development, Mr. Greenspan said in testimony…” (http://query.nytimes.com/gst/fullpage.html?res=990CEED7103EF932A25751C0A9669C8B63)

    We have deregulation to thank for the cheap, easy credit which led to the collapse of the housing market. We have deregulation to thank for Enron, as well as for the probable speculative abuses of today’s energy markets. We have free-market suck-ups who wag their pompous fingers to society on the “virtues” of globalized cheap labor, yet who apparently lack the basic intelligence to figure out (or rather, the basic honesty to admit) that closed-border nations like India and China don’t practice “free markets”, and that globalized cheap labor exists to enrich the global capital elite at the expense of everyone else.

  • sumant

    I’m a little intimidated by the intellectual firepower on display but I’d like to pose two questions about the nature of markets.Does Minsky’s thesis on the instability of financial markets suggest that despite regulation financial crises are a natural phenomenon and like other natural disasters difficult to predict and prevent ?Or to paraphrase Churchill markets are the worst systems for organising economic activity till you examine the others?

  • sumant,

    I suspect that what you suggest is close to the truth. There may be some helpful regulations along the lines of increased transparency and disclosure, but what we’re likely to see resulting from current calls to do something will not be an improvement.

    I think we’re likely to fall victim to the Politician’s Fallacy:

    1) Something must be done.
    2) This is something.
    3) Therefore we must do it.