Does Obama Believe in Big, Government-Directed Breakthroughs?

libertarians throw around the word "government" as an epithet. they are childish to believe that government is inherently bad. of course there is nothing inherently wrong with government or with markets for that matter. government is simply a contract between us. i'll pitch in and you pitch in and so will others, and collectively we will do things that we could not have done alone. we can establish rules, and protect ourselves, and connect ourselves and more. the extent and content of this contract is negotiable and constantly changing. markets in and of themselves are a beautiful thing and are innovative and creative. its just that markets and corporations only have an obligation to the shareholders and are not moral or immoral, but rather amoral. there is some recourse with government and it can be held accountable to the general public. and although what UPS and Fed Ex do is impressive, only the USPS will hand deliver a letter for under 50 cents. libertarians never bring this into the equation. of course government is less efficient, it has other considerations aside from just the bottom line, which is important for the actual human beings that make up these systems. i think sometimes people forget that we are more than numbers or concepts.

the essence of the libertarian worldview is that man is an island. it doesnt take into account the helplessness of all humans at the beginning of our lives and generally at the ends too. as much as we fetishize the idea of the "self made, bootstraps man or woman, in reality life on earth depends to a large degree on communality, brotherhood, and relationships. this is not only true socially, politically, and economically, but spiritually as well. which is why this idea is so potent. the undercurrent is the fundamental connectivity of the human race.

libertarianism many times assumes an arrogance and a "the world and government are holding me back" type attitude. its the man at the pinnacle of his powers and flush with hubris declaring that "these parasites and underlings are chains around my spirit." most humans have learned the hard way that there is no doing this on our own, and the reason most victory speeches include thanks all around for aid is because very little is accomplished in this world in a vacuum by oneself. the john galt illusion tries to build a real person out of 2 dimensions, and 3rd rate philosophy and fails.

ultimately, libertarianism is not only more cruel and selfish than other ideologies, but it is less effective, which is the most important point. my neighbor doing well helps me do well. win-win is the real win. there is no win-lose. because we all lose together.

Cato's Tom Palmer does a nice job defending against the "libertarians think that man is an island" charge here: http://www.cato.org/pubs/policy_report/cpr-18n5...

There's a tremendous deal of libertarian/ Rand bashing so as a libertarian myself I must speak up.

Markets (when left unfettered) do not fail. This does not mean that failures do not occur in an unfettered market.

Government does NOT permit us to exist, but rather we permit it to exist. If economic transactions stopped and there was nothing left to tax, the government would have no income left to finance itself with. We the People created government, not the other way around.

If you beleive that certain areas (ie alternative energy) should be researched by the government then you have the right to contribute your own earnings to the endeavor at your own will. Shouldn't I and anyone else then have the right not to contribute?

Libertarians beleive in the courts, military, and police b/c they protect our rights to life, liberty, and property when acting within the constraints of the Constitution.

I do not live for the sake of anyone else and I will not ask you to live for the sake of my life.

"Markets (when left unfettered) do not fail."

This is a near-perfect example of why I no longer identify as libertarian. Your "market" exists in carefully contrived circumstances in economics textbooks (the authors of the textbooks even know this - they're trying to simplify so they can teach). It's a concept that, the way you think about it, is so divorced from reality as to approach meaninglessness.

People are irrational in all sorts of ways. They don't save adequately for retirement and then they end up poor. In a democracy they have political power, and thus in sufficient numbers can shift their problems on to others (it's happening right as we speak).

Credit markets are sophisticated and weird, and when they fail they pull down your beloved perfectly-competitive fish seller - no matter how good this person is at his job. Insurance is sophisticated and weird. Economies of scale exist and winners sometimes take all, they use money to buy political influence and change the rules. No market will get people to be vaccinated against TB - governments must use force to make public health work (in Bastiat's world, everyone's dead). Specialists have information other market participants don't and you better believe they take advantage of it as much as the law and ethics allow.

Any usage of "market" in actual policy discussions that's divorced from realities like the above is useless. Just because you wish elegant, unfettered markets existed and correlated 100% with that which is good and true doesn't change reality at all.

Steve-

"People are irrational in all sorts of ways. They don't save adequately for retirement and then they end up poor. In a democracy they have political power, and thus in sufficient numbers can shift their problems on to others (it's happening right as we speak)."

-The U.S. Constitution protects us from them shifting their problems to others, however, that document seems to have been thrown out along with reason a few decades ago by our leaders.

"No market will get people to be vaccinated against TB - governments must use force to make public health work"

-Do you value your health? Would you get a Tb vaccination? If you value your health and would get a vaccination is it hard to imagine that others would to?

If you accept that the government must provide us with healthcare because we are too irrational to provide it for ourselves then you probably accept that we are too irrational to provide ourselves with an agricultural industry to feed us, and a construction industry to provide us with shelter, and clothing manufacturers to provide us with clothing. The vast majority of people have all of the above mentioned items, not because government provided them, but because the vast majority of people are rational.

If people are not rational then we should not elect people to govern us.

"The U.S. Constitution protects us from them shifting their problems to others, however, that document seems to have been thrown out along with reason a few decades ago by our leaders."

We got a live one! Hey Bastiat, what's your view on the constitutionality of the income tax?

"Do you value your health? Would you get a Tb vaccination? If you value your health and would get a vaccination is it hard to imagine that others would to?"

Oh dear, hasn't made it to prisoner's dilemmas yet.

And as for rest of the hyperbolic slippery slope stuff, I simply point to every other western-style democracy in the world. Ever visited one? The toilets flush and people have iPods.

"You can enslave some of the people all of the time, and all of the people some of the time, but you can not enslave all of the people all of the time." The middle clause is what makes government a government, versus, say, a group of people who joined, remained and obey the group's rules by choice. All the weight of all the best policy studies can only say "This is what you should agree to, for the reasons given." They cannot say that you can be made to comply by right of the government at hand.

Wow thats a great counter, "everyone other country does it, so should we."

I have visited several western european countries. The plumbing in the U.S. has better water pressure and more people per capita have iPods.

and WRT: "If people are not rational then we should not elect people to govern us"

so wait, let's say we prove to you beyond a shadow of a doubt that people are irrational in many respects. you can run experiments over and over and see that people act clearly irrationally.

Bastiat's answer is we throw up our hands on the whole human-progress endeavor, once it gets the slightest bit complex or muddled, and punish ourselves with - what, anarchy? A nuclear exchange?

My answer is not to "throw our hands up." You say people are irrational so the government should take care of them. That sounds like the blind leading the blind to me. I don't care what political platform you stand on, but both of the mainstream sides have been atrociously irrational.

You seem to be however a rational person, or at least someone who is capable of taking care of yourself. Do you think you should have the option of opting out of Social Security or other government "safety nets?"

Thats my biggest issue with government. People do not have the choice of being more personally responsible for their own well-being. This is an option I would like to have.

Bastiat,

You accept the role for government for police and the military. But why? Why is the government the best entity to supply protection? It's because in the absence of coercion to pay for these things, the free rider problem would make them impossible. Isn't it?

And if so, why aren't you open to the idea that other, similar market failures could exist and need collective action to correct?

Thats a good question.

The answer goes way back to the foundation of government in the first place. I'm about to get a tad philosophical so I apologize in advance. Imagine that no countries, governing bodies, or official societies exist ie there are no formal laws. Would you agree that each of us has a natural right to defend our life. liberty, and property? (I'll assume you do since I'm sure you wouldn't take a person harming your family or your property without a fight).

Life, liberty, and property are the three basic requirements of life, and the preservation of any one of them is completely dependent upon the preservation of the other two.

If every person has the right to defend - even by force - his person, his liberty, and his property, then it follows that a group of men have a right to organize and support a common force to protect these rights constantly.

Here is the kicker: The collective right of a group of men (aka government) to defend each person's life, liberty and property is derived from the individual's right to defend. And since an individual cannot justly use force to infringe on the life, liberty, and property of others, logically the government cannot justly use force to seize/ destroy life, liberty, property of an individual.

This is the exact reason why the U.S. Constitution is so extremely limiting on what it allows the government to do and why libertarians reject the notion that government can do anything but protect our rights; to do otherwise would inherently be an infringement on our natural rights.

Boy, you have read your Bastiat, haven't you? Problem is, not all of us libertarians recognize the validity of "natural rights," or at least think that rights can solve all the tough cases out there. Rather than rehearse the old arguments here, I'll point you to David Friedman's discussion of the problems of deriving libertarianism from simple principles: http://daviddfriedman.com/Libertarian/Machinery.... I think he does a nice job showing why rights theory isn't enough by itself to solve some thorny problems at the edges of libertarianism, and you'll probably find it an interesting read.

Greg-

Thanks for the suggestion, I'll be sure to check it out.

Of course, Will ignores the substance of Hilzoy's comment. So here it is:

"To be fair, Wilkinson does not seem to mean that Obama is a closet Objectivist. He means that Obama, like Rand, believes in "saltative, game-changing, lone-genius invention" rather than "an accumulation of tiny productivity-enhancing innovations" as the driver of economic growth, and hopes to achieve it via government intervention. I don't see that at all: I think Obama's economic policy is driven not by a particular view of the specific types of technological change that drive growth, mainly by quite different ideas: that we need to replace demand to get out of the recession, that we cannot defer dealing with energy and health care without doing lasting damage to the economy, and that we have underinvested in public goods and infrastructure in ways that we cannot afford to continue.

But insofar as I can discern a position on the question "saltative invention vs. an accumulation of tiny enhancements?", I would have put Obama in the second camp. He is, after all, known to be a fan of behavioral economics, with its many tiny tweaks, and his whole history as a Senator is full of small legislative improvements of the sort that no one who cared only for game-changing leaps would have bothered with. But I can't think of a single analog to Galt's amazing static-powered engine in Obama's entire set of beliefs. In any case, I'd be interested to hear Wilkinson's reasons for thinking as he does."

Well, I would be interested in hearing Wilkinson's reasons as well. He's ignored Hilzoy's argument and focused on his made up straw man.

Well, I would be interested in hearing Wilkinson's reasons as well. He's ignored Hilzoy's argument and focused on his made up straw man.

It's a blog-eat-blog world! I dunno if you're ever going to get anyone to actually address someone else's argument.

Why do liberals (non-economists) never defend business, capitalism and markets? They could use many libertarianish arguments without advocating laissez-faire or contradicting liberalism.

Well we're constantly on the defense against libertarians and conservatives who trot out literally stupid Galt arguments, or who have religious hangups like tax-cut Reagan religion.

Some of us just want to fix the damn healthcare system, for example, given the realm of what's politically possible (not entertaining fantastic options that are the equivalent of privatizing the police force - i.e. nice theory, go try it somewhere else). We're totally open to markets and innovation - we all fundamentally agree in an American sort of way on this, but unlike libertarians we recognize that collective action problems exist, market failure exists, and that it's often worth trading in some economic liberty to maximize welfare (well-being).

Some of us have been standing in the same place and the borders have been redrawn such that now we're liberals. For me personally, when I see what's left on the other side of the border these days, I don't mind the label anymore.

Will, I'm a big admirer of your work, but I just don't see what you're getting at here. I mean, do you honestly disagree that investment in science and medical research can lead to "new discoveries" and "breakthroughs" -- meaning, as Merriam-Webster's helpfully tells us, "a sudden advance especially in knowledge or technique"? If you do disagree with this, do you know anything about the science funding systems in place in this country, and how and when they've succeeded or failed?

This post is really quite bizarre. You're skewering a straw man here, and not the rather unremarkable, more-or-less obviously true line from Obama's speech.

Go read my reply above to 'Just Me'.

You are not understanding Will's point.

Blog posts don't need to make sense, they just have to stir up "controversy!"

Government or Private Sector: Which does a better job providing goods and services?

For those in government, survival depends upon re-election which in turn depends upon buying votes and returning favors of powerful donors.

However, in the private sector, survival depends upon providing the best goods and services at the lowest cost to the most consumers.

Government services are funded by coercive taxation, whereas private sector goods and services are purchased voluntarily.

Government functioning requires central planning by a handful of politicians. The private sector is driven by millions of minds motivated to earn a profit by responding to human needs in real time.

Theory is confirmed in practice as we observe the hundreds of consistent economic failures every time government tries to centrally plan an economy as was done in the Soviet Union, Cuba and France.

Until Obama was elected, we had centuries of enormous wealth creation, prosperity and personal freedom in the U.S. which remained true to free market principles and liberty.

Is it really possible that someone writing on the internet (descended from ARPANET, invented by a government-funded program), using the protocol html (invented at CERN, funded by European governments), and being read on a web browser (invented at the NCSA, again funded by the government) believes that government funding won't spur “new discoveries” and “breakthroughs”! Really!?!?!

If government took half the taxes it does, you might have discoveries and breakthroughs that far surpass any of those.

The argument is not that nothing comes from the government. It is that what comes from the government, in general, is going to be less than if you left the money in private hands. There might be a few exceptions to this, but they serve to prove the rule.

However, incrementalism, which Will was talking about has been entirely provided by the private sector: AJAX technology (MS), Flash (Macromedia), High speed internet (Cable and Telcos), Internet search (Google), CDN (Akami/Limelight), Mobile internet devices (various companies), Auction Marketplaces (ebay), free personal ads (craigslist), etc. Additionally, many of the communication access points can be attributed to deregulation of the telcos. I doubt individual ISPs could have cracked the market prior to telco deregulation. The same deregulation brought us: cell phones, cheap long distance, cable modems, call waiting/forwarding, etc. While the gov't can bring about research breakthroughs, the private sector eats its lunch regarding incrementalism. To deny that is to be a free market hating socialist :P

From my understanding, many of the NASA breakthroughs were actually developed in the private sector: Teflon (DuPont), microwave ovens (Raytheon), Velcro (Georges de Mestral), Integrated Circuit (Texas Insrument/Fairchild Semiconductor), Tang (General Foods)! Landing on the moon is something else, but I prefer little things that make my life easier everyday.

No, what Will was doing was saying that statement: "We’ve also made the largest investment in basic research funding in American history — an investment that will spur not only new discoveries in energy, but breakthroughs in medicine and science and technology" was "adolescent faith." I was just pointing out that Obama's statement is true---government spending on science has in fact, on this very planet, spurred new discoveries and breakthroughs. That's a totally separate question from whether or how the private sector improves on those discoveries and breakthroughs.

Well, in part it is "adolescent faith" because you cannot throw money at something and expect breakthroughs. If that were the case we'd have super incredible solar power by now. Look at how many dollars were thrown at that problem, and how little we've gained by it.

And yet government spending on basic research funding resulted in the fundamental discoveries and breakthroughs that made this very conversation possible. It's a quandary!

It's just a fact of history. Many useful discoveries are by-products of wars. That doesn't mean that war is a good thing.

A libertarian can't avoid using government-provided services just as an environmentalist can't avoid using environmentally harmful products. Our society is structured in a certain way and we just have to adjust to it even while we struggle to change it.

There's too much heat in these comments.

The question of government's proper role in research funding cannot be settled by referencing one's ideological commitments, nor even an economic theory. Ultimately, like almost all questions, it comes down to empirical comparison.

There are reasonable a priori arguments on both sides, namely:

1) Pro-government-funding: basic research will be undersupplied without government funding, because knowledge spillovers from basic research are a positive externality (future entrepreneurs can capture profits based on the ideas that come from research). Thus, government should provide sufficient incentive (subsidy) to restore efficiency to the market. Sounds plausible!

2) Anti-government-funding: In practice, government funders do not focus on the right problems as efficiently as do private research firms. Large, long-standing companies do have sufficient incentive to perform long-term research, because they can capture the entrepreneurial gains of this research through novel product development. Also plausible!


What do you do when you have two plausible theories that lead to disagreeing conclusions? You test the theories! I don't have the answer to this question, but I just want to point out that the truth is likely somewhere in between, and ideology is too simplistic to furnish a guaranteed-correct answer. Isn't this obvious?

"an investment that will spur not only new discoveries in energy, but breakthroughs in medicine and science and technology."

I'm not an Obama supporter, but to play devil's advocate here, hasn't government investment in basic research (e.g., through NIH or Defense Department grants) led to breakthroughs in these areas already (e.g., the Internet, advances in robotic medicine technology, etc.)?

In your previous post on Atlas Shrugged, you claimed that you were afraid of too much government investment in "Project Xes" stifling innovation. It seems to me that the larger threat to innovation would be President Obama's plans to nationalize health care, which would invariably lead to de jure or de facto price controls, thus reducing funds for private sector medical R&D.

There is no doubt that government investment in basic research facilitates research breakthroughs but the question is how much society benefits. After all, Soviet Union government investment in space exploration was very successful but few (I hope) would argue that its citizens benefited much. As NIH-funded researcher myself, I often wonder how much the NIH funding benefits the society. One needs to realize that the NIH mission is to improve public health care in the US, not to find out what particular biochemical pathway is involved in cancer. By most estimates, it costs anywhere between $250 and $800 million to develop a new drug and introduce it to market. The NIH annual budget is over $30 billion. That means we should be eventually getting 40-120 new drugs from each year’s NIH funding at the current level. One look at the anemic list of recently FDA approved drugs and what is in the clinical trials will tell you that we are far from those numbers even now. What I’m trying to say is that a lot of governments around the world support science but what this country has always going for it was the ability to make the research breakthroughs into things that benefit everyone. My worry is that the Obama administration will severely damage this system by crowding out private investment.

Suggestion. Quit apologizing for liberals and Obama. We can observe that they are promoting reckless policies that are destroying our economic prosperity and liberty. I will go a step further and suggest that you are acting immature by your comments.

Obama and those who are advocating his policies are destructive. Please stop suggesting we should not question their motives. Their motives are irrelevant. We are talking policies and should evaluate them on their outcomes or potential outcomes.

Government investment in science and technology does in fact lead to breakthroughs. Publicly funded pure research in logic around the turn of the 20th century, for example, laid the conceptual foundations for modern computer science; these concepts were applied by governments in building the first computers. A ton of basic research had to occur before the (ahem) romantic stories of "guys in garages" starting billion-dollar companies could happen. Alternatively, consider spinoffs from NASA research, or the predominance of start-ups in biotech that have grown out of research taking place in labs at publicly funded universities.

For a concrete,specific example in the area of energy and efficiency, consider the case of low-e windows. This is a technology that was further developed and commercialized as a direct result of Carter's energy policy; a policy to which the glass towers now seen in most American cities ought to be seen as a monument, not only in the sense of the pyramid; the passive solar heating of these buildings has saved a great deal of energy, lowering CO2 pollution. We were, unfortunately, significantly set back by ideological opposition to government involvement in promoting efficiency and clean energy. We cannot afford to lose another two decades in the effort to stop changing the climate.

We should not fetishize either government or the private sector as the sole font of innovation. The link on low-e windows provides an excellent case study in how partnership works best, but the principle is illustrated throughout our economy. Basic research is an economic activity that generates positive externalities. Under a hypothetical pure libertarian system of only private funding for research, John might pay Sally to do some basic research in quantum physics. Now there are two options: (1) Sally's findings will be made public, or (2) John will own and keep secret Sally's findings.

If (1), then maybe Phyllis gets a hold of Sally's findings and builds a quantum computer. Phyllis benefits without having put in, a positive externality. This is great, but it shows how the market can undervalue activities that create positive externalities. Private investors have an incentive to put in in proportion to what they expect to get out, so the market based investment in activities with positive externalities will not be in proportion to the benefits.

One expects libertarians to plump for (2). If (2), however, then the flow of basic scientific knowledge to innovators like Sally is blocked, stifling innovation. We cannot have an innovating economy if we have knowledge hoarding. Maybe the libertarian will reply based on some pure economic theory that knowledge hoarding will not occur, that perhaps John will license access to his proprietary basic knowledge to people like Phyllis, but shall we risk testing this speculative theory or continue and intensify the public-private partnership that made America a leading innovator in the 20th century?

Furthermore, knowledge tends to get around to those, like Phyllis, who are intelligent and driven. For this reason, option (2) may not even be feasible and we are stuck with (1). The solution, of course, is public subsidy of economic activities, such as basic research, that are undervalued by the market because the benefits are disperse. Finally, the trouble with the Randian fantasy of all the innovators running off to some island or whatever is that many of the innovators are too busy writing grant proposals to read the fantasies of third rate philosophers.

"Finally, the trouble with the Randian fantasy of all the innovators running off to some island or whatever"

If your theory of public goods is correct, then wouldn't all the innovators run off to some island in a _libertarian_ society, not in a statist one?

So innovators "go Galt" in libertarian societies, in protest against Phyllises. Heh.

5th paragraph, 1st sentence should read "One expects libertarians to plump for (2). If (2), however, then the flow of basic scientific knowledge from researchers like Sally to innovators like Phyllis is blocked, stifling innovation."

"Why didn’t we think of this before? I know, I know. We did. Bush promised us hydrogen powered cars by yesterday "

"New discoveries" and "breakthroughs" are vague and almost inevitable predictions unlike something specific, such as hydrogen powered cars.

You don't make predictions about basic research, you fund it and see where it takes you.

You guys can't possibly be this dumb, and I'm pretty sure you're not arguing in bad faith. Why are anti-government types putting forward such shoddy arguments? Is it that you want to close your eyes and wish really hard that the set of libertarian "principles" in your head matches up with reality?

The problem is that you do make predictions about basic research. You choose what you research based upon initial research and investigations. Once you have done these, you choose what kind of research you want to do based on 1) likelihood of success, and 2) whether you can get funding for it. If the government decides to fund a certain type of research more effort will be put into that research track than otherwise would be. This is fine if it is a good research track. However, it will likely crowd out other research, and the government may have picked it due to political considerations rather than good science. A la ethanol. If the government decided that hydrogen fuel cells were the way to go, then less research would be done on batteries. And vice versa.

And the government often decides who gets funding based on which group or company has the better hookers (I mean 'lobbyists').

AnotherBen's point about ethanol undercuts your arguments Steve C with a real-world example of the government royally screwing things up by picking ethanol as a winner. It's a total loser and has even helped starve children in Africa. Gotta love that government in action.

uknowbetter, are you condemning the idea of basic research based on one (large) failure?

More to the point, this line of reasoning can be much more powerfully employed to prove the failure of market capitalism as of 2/09. Are you prepared to admit that ethanol, as one example of basic research, and therefore a comprehensive indictment of basic research in general, has an analogue in the MASSIVE WIPEOUT OF CAPITALISM in the last few months?

Libertarians should simply admit that they have an anti-government taste preference. This is not a set of beliefs that holds up in the messy world of...the real world. It's not rooted in empiricism.

I would say this is unreal, but I meet people even more clueless than you everyday.

This financial crisis was caused by the government screwing around with the market. How hard is that to understand?

Keep living in fantasy land and lying to yourself. I bet you haven't seen this article:
http://www.thedonovan.com/archives/2009/02/oka_...

I think it depends on the belief. Opposition to minimum wage laws, for instance, is firmly backed by lots of empirical evidence. Because of that, libertarians oppose minimum wage laws. Despite that, most modern liberals support minimum wage laws.

I tend to agree that some of the more radical libertarian philosophy breaks down at the edges, and that foot-stomping, ear-plugging apologetics at those edges is pretty wacky. But most libertarianism isn't at the edges; it really is a "set of beliefs" designed to solve real problems in the real world. And rooted in a respect for empiricism (e.g., that many government programs leave people worse off than they would be in the absence of those programs, and that markets can outperform governments at most things, but not all).

An entirely reasonable outlook IMO.

I guess the best strategy to disprove Will is to point out that the government isn't too bad at completing incredibly expensive, aesthetically pleasing but relatively unproductive projects. Might as well appeal to the Pyramids to point out the incredible productive power of the state.

Best comment yet.

Todd and Urstoff evidently posted this in earnest using the internet.

Do you play the lottery too, since even though the odds of winning are astronomically low, the payout is pretty good?

A telling analogy: write off all datapoints that don't fit into the model - that's libertarianism.

I must have forgotten about the rules of justification where a single outlier is sufficient epistemic grounds for a strong induction.

"I guess I’ve developed that impression from all the speeches Obama has given informing us of his intention to use the state to transform the entire economy into one based on completely different sources of energy."

That will happen anyway, with or without Obama's help. There is 10,000 times more sunlight than we need for the energy needs of the entire planet. Solar power and nanotechnology are advancing exponentially. They are getting cheaper and cheaper. Sooner or later they will out-compete fossil fuels.

It will take longer if government crowds out those developments by picking winners.

'How can we let solar power be successful when we just spent $5 trillion on wind power? That will screw up my legacy, and this president just can't have that.'

On that note, I wish Pickens would shut his hole. If wind power was so awesome, then spend your billions and make money on it. Instead, he uses his money to lobby the government to give him more money. That's just evil.

I got a lot of pushback on something that I think is nonetheless true: when those right of center make "government is the problem" their position, they lost their ability to make effective government.

Their own low expectations kept them from demanding, let alone policing, their appointees. That's how we got "heck of a job, Brownie" out of an entire movement, not just a President.

What you've got in Obama's crew is an opportunity. They might be the sorts that actually demand that government work, that it not get a free pass for non-achievement, and that they will police their actions to that end.

I could go beyond that, as a semi-libertarian, and say that we want Obama's Bizzaro World Randians to run government, but we also want to keep that government small.

Small government... run by people who can actually believe in it.

Wow, you actually believe this crap?

For one, Bush was a big fan of big government:
“We have a responsibility that when somebody hurts, government has got to move."

Two, the gigantic point of many small-government people (from liberals to conservatives to libertarians) is that government should focus on a few key pieces and DO THEM RIGHT. When government does everything, it can't get anything right.

But go right ahead and keep talking to the straw-men in your head if it makes you feel better as a person.

Do I believe it? Dude, you are the one proposing GWB as a model for effective government.

You are the one who described GWB as some sort of anti-government libertarian.

He was not. He was a big government politician just like Obama.

You keep believing that the problem is that the magic wand just won't work unless enough people want it to. The real issue is that there is no magic wand.

Try to get "liberals to conservatives to libertarians" on which "ew key pieces" to focus on, unkow.

National health care?
Defense?
Borders?

Good luck.

Courts, police, defense. If government can't get those right, then it shouldn't be doing anything else. Police and courts are two great examples that further illustrate the point. They could be run so much more efficiently without the non-sense of the drug war.

My point was that small-government people (they come in all stripes, but less likely to be liberals) all want government only to focus on a few things so it can get them right. Those who want government to do everything are the ones who want government to fail.

"Courts, police, defense."

Why? What's so special about them? Why not social safety net, health care and education by government, and police and defense by the private sector?


"When government does everything, it can't get anything right."

Why not? Why should the same people be taking care of, say, education and defense? Just expand government with many independent, specialized departments.

Why not? Reality.

Heard the phrase, "jack of all trades, master of none"?

No entity (aside from some sort of god) can effectively do a million-and-one things. The more things you pile on the government, the worse it will do them.

Government is not a single entity. How can hospitals treat many kinds of disease? Because hospitals have many specialized departments and units. Doctors are not jacks of all trades. There are cardiologists, geriatricians, radiologists etc.

You are basically saying that the institution called a hospital should only treat 2 or 3 diseases because the more things you pile on it, the worse it will do them.

You proved my point. Hospitals focus on healthcare, not healthcare, national defense, immigration, police, courts, education, etc.

Government is inefficient no matter what it does, but the more you give it, the more inefficient it is. Just look at these current bills and earmarks. $7 billion in earmarks couldn't be included if the total bill was $20 billion. It's so much easier to hide waste, fraud, abuse, incompetence when they are spread to all these different tasks.

They involve coercion. It's never been successfully done in the history of the West, the closest approximation being what are otherwise known as "lawless" areas like Sicily, where the mob rules (or used to).

Phew. I used to make these arguments, hard to believe. They ought to be taken exactly as seriously as anarchist utopias.

"Courts, police, defense."

Anti-brown people operations are all that government should do, uknow?

I'm all for small government, but the defense department and it's bloated budget is the first thing I'd chop.

Those are generally the basic functions of the nation-state: to uphold the law against those who violate it, foreign and domestic.

Like nearly all government, I would cut all three.

Yep. "Government is the problem" has been a self-fulfilling prophecy. It doesn't have to be that way. It didn't used to be that way.

great post

Comments thus far prove Will correct and Hilzoy wrong.

Entirely appropriate reaction given that libertarianism in general, and the libertarian argument here in particular, is almost entirely built upon raw assertion. You don't need to tell us what's wrong on substance, you just need wink-wink.

Libertarians might want to consider confronting the eventual empirical issues should Obama be successful. Will he have been lucky, challenging none of your beliefs? Will you say "well we got to 3.5% growth, but had it not been for crowding out and blah blah blah we'd be at 4%!". Or will you have learned something - that challenges a core belief, say - what do you think you will have learned?

This is the same exercise all Iraq war proponents (if they're thoughtful and live with us in reality) ought to have gone through. It might be useful to start now.

Your answer is a fallacy. Whatever government does, that is automatically optimal because to question that is just crazy-talk according to you.

That's insane. For all you know, we might have double the GDP if the government know-it-alls didn't tinker.

"That's insane. For all you know, we might have double the GDP if the government know-it-alls didn't tinker."

For all you know, 4x the amount of intervention and regulatory burden might triple GDP. That's the level of sophistication of your argument.

It can't just be that you FEEL like government intervention in any given case is bad. You ought to examine the details, understand that forces at work (massive drop in demand, peculiarities of the healthcare system, basic research), develop some kind of understanding for the subject - what other countries have tried and been successful at, how the market works, what kind of ends are important socially, etc, then arrive at some minimally informed conclusion.

Reading Reason magazine and Ayn Rand and taking Econ 101 is a nice start, I guess, but it doesn't amount to much.

We know that isn't the case. If so, communism would have been wildly successful. My arguments are from facts and history; yours are from wishful thinking in magic hopey-changey-land.

Even Keynes said that government should only take about 25% of GDP as a maximum ceiling. We are well beyond that once you add up Federal, state, and local spending.

You might want to go read a book or two. I'd start with a few on the 20th century since you seem to know nothing about it.

Looking through this list I don't see any reason to correlate govt spending as a % of GDP and overall well-being:

http://anepigone.blogspot.com/2008/03/governmen...

I think anyone would say that France is a pretty successful western democracy - I'm lucky enough to spend a portion of my year there, I know many french people and have a good understanding of the economic climate, the work culture, levels of affluence, the challenges they face, etc.

I don't think France is something to aspire to, but then I'm not particularly convinced the US is either. You have lots of different models of "success" in the West, most of which involve policies and general political/social models that US libertarians hate, and for instance, people like you would have made hyperbolic statements about communism, predicting failure, etc 40-50 years ago.

The failures haven't happened. But still, libertarians can't help themselves: it's not enough to admit straight out that you have certain taste preferences. You believe so strongly in limited government that you warp your view of the world such that, say, 60% govt share of GDP in France MUST mean France is a failure as a nation/society/etc. They must be either deranged or secretly hoping to be liberated.

And in the face of difficult-to-deal-with argument you trot out the slippery-slope communism stuff. Pretty weak, is that all you got? Must not be much to this little ideology of yours.

France is a free-rider of many things developed in the USA.

From healthcare to other areas, they benefit because we are more free. Do you actually think France is the engine of the global economy?

You do realize, don't you, that the Exxon Valdez oil spill was a net positive for GDP? The money spent on clean up was considerably more than the value of the oil lost so, voila, Valdez was an engine of economic growth!

Point being, even if your counterfactual were true, GDP is a stupid metric. Read the Wikipedia entry on "uneconomic growth" for an introduction to some of the relevant concepts.

Also, if you consider GDP as an indicator of society's "cost of living", there's no reason to think that bigger is better. It's really a question of what color ink you choose to write down the numbers. (If you're reading this Will, the concept of "natural capital" has relevance here--cheers!)

And, in the hopes that you won't dismiss this out of hand as the ravings of a stoopid liberal, I'll throw you a bone: Government is TOTALLY EVILLLL RASSAFRASSA HORRIBLE BUREAUCRATS ARGH!!!!

OSweet's point is well-stated.

Where did I say that GDP was the be-all and end-all? It's one metric used to measure things.

The attitude that 'like, omg, the government HAS to do a billion-and-one things or like there is like chaos' is ridiculous. 90-100% of the dollars the government takes out of the private sector are spent less efficiently. That lowers economic growth. To what degree is debatable, but the general point really isn't.

OSweet's point is well-stated.

If you think that OSweet is disagreeing with me I'm pretty sure you're confused.

Had the spill not happened, the money...would have gone toward productive (non-dead-end) purposes.

I couldn't have said it better myself. The fact that this non-productive waste of money and natural resources is counted as a net benefit to the economy is a textbook demonstration of uneconomic growth and shows that argumentum ad GDP (to coin a phrase) is a fallacy.

As for the rest, yes, MACKINFRACKIN GOVT VARMINTS GRRRR!!!

GDP is one metric. Get a clue.

As for the rest of your beliefs, I can some them up as follows: government is god.

Geez.

Had the spill not happened, the money and other resources that unfortunately had to go to cleanup (not to mention the oil lost) would not have sat still; they would have gone toward productive (non-dead-end) purposes.

Yeah - well - see, here's the thing.

Will seems to think he knows what Obama, and his supporters, think, based on what Obama has said. Mind readers worries me. And I think it might help to explain some of what my more liberals friends think; or at least what they say about what they think. Because I think what this disagreement suggest is something more interesting than "LOL U GAIS THINK GUVMANT IZ KUL BUT ITZ NOT! LAWLS!" or "You juveniles! Don't you understand the shared humanity that unites us all?"

Collective pronouns - like "we" - are really important here. My impression is that Obamican liberals don't share the distinction between "state" and "citizen" that characterizes the libertarian mind-set. Obama's "we" is not "us good non-government people and not those ignorant non-government people". Obama's "we" is more collective. But Obama's "we" is dangerously myopic. Power corrupts. Yielding your autonomy to any collective is problematic.

And that is also the libertarian problem, in my opinion. Nozick et al don't, on the whole, make adequate distinctions between individuals and collections of individuals. Few liberals have a "romantic ... adolescent faith in the generative powers of the state." Liberals see the state as a part of "we". They're opposed to the idea that "we" can't do things - so they oppose the idea that the state is impotent.

Libertarians have a (perverse) faith in non-government "we". But Galt can't build millions of his motors. He can't sell them, nor repair them, on his own. So let him quit. If the physical principles that underlie his genius design are correct someone else will notice them. We all stand on the shoulders of others. Besides -- rewarding his genius will take the combined efforts of a vast number of people.

Anarchists dislike "we". Both letters. The larger the collection of people in your "we", the more compromise, and moral erosion takes place.

We should have laws against "we". In fact we should have a law against that law.

Paul,

I could be wrong here but you seem to be criticizing Will for extrapolating too much from liberal sources to state what liberals think....but...at the same time...you then try to veil a generalized extrapolation of ehat libertarians think based your reading and/or impression of selected sources.

Is that not the same thing?

Not exactly.

In his speeches, Obama does not try to lay out what he thinks in the way a more lengthy conversation might reveal. No one -- not me, not you, not Will -- has brought up to him the famous razor "What you mean, 'we', kemosabe?"

So my observations, not really meant as a criticism of Will. More meant to punt the conversation a little further down the field. Although, as an aesthetic question, the 'paranoid style' in politics, where you maintain a cynical mask with respect to your opponent's motives and integrity? I find that ugly.

Is there a version of Godwin's Law that applies to Bush? I mean, what didn't Bush fail at?

Like or not, governments have succeeded in scientific projects: moon landing, development of nuclear weapons, navigation and shipbuilding, aquaducts, city walls to keep out barbarian invaders, etc. It's not impossible.

Moon landings and nuclear weapons development, shipbuilding, etc. are examples of projects that reflected an urgent national need. Our current administration (and Congress) are attempting to direct public spending at projects that do NOT reflect the urgent needs of the majority. We do not face a national urgency to completely change the sources of energy or the revamping of the education system or even government-run health care. These are certainly areas that require monitoring, "tweaking", and regulating to some degree, but are not the most urgent issues of most consumers. We, as consumers, urgently need government to keep a 'hands off' policy in areas like automobile production, energy development, and the mortgage industry. Most private sector endeavors can thrive and serve consumers honestly under the current laws. Increased government intervention such as CAFE standards on cars and CAP & TRADE laws and CARD CHECK rules will do much damage to an already hurting capitalist system. And it is this capitalist system that made the U.S.A. the greatest nation on earth in the shortest time span ever witnessed.

"Like or not, governments have succeeded in scientific projects: moon landing, development of nuclear weapons, navigation and shipbuilding, aquaducts, city walls to keep out barbarian invaders, etc. It's not impossible."

Landing on the moon or building city walls is very different than managing and directing the entire economy.

Which is not what Obama is proposing. Obama is proposing:

1) A rather small subsidy for research ($15 billion a year is a drop in the bucket compared to the overall economy or even total government spending)

...and I could really stop here, since it's what Will talks about in his post. Also, in his reply to me in the last post Will said that this was what he meant by Obama's faith in the transformative power of the state, and that bringing up cap and trade confused the issue. But here's the other thing Obama proposes:

2) A system of regulation of carbon, to which the economy will have to adapt. But, other than charging a price for carbon permits, the government won't be directing the adaptation. No one is going to be ordered, "You must convert all your electrical appliances to the new Baz Fazz system." Instead, economic actors will adapt in their own way. Maybe some will choose to cut their production. Maybe some will find more efficient ways of using energy, and adopt those. Maybe some will decide that it's so important to them to keep up their levels of carbon production that they'll be willing to spend the extra money it takes to buy up more permits. This is pretty much the opposite of managing and directing the entire economy.

Yes, he wants to regulate the economy, in a way that will hopefully lead to a great transformation of it. That seems necessary because if we don't limit carbon emissions one way or another, we're in enormous trouble. But it's not unprecedented for a big government project to lead to a transformation of the economy as people adapt to the new framework. There's the internet, and the interstate highway system, and electrification, and probably more.

An oft-overlooked (or ignored) truth, Matt, is that there is simply no proven need to regulate carbon output. Climate scientists are steadily moving toward the belief (based on more accurate scientific data) that the earth's climate (temperature) is primarily affected by factors other than human-introduced GHGs. Solar activity and natural climatological phenomena such as PDO (Pacific Decadal Oscillation) have been shown to be the most influential elements in the Global Average Temp (whatever that phrase means...) Formula.

Temperature is not the only thing to worry about.

http://www.newscientist.com/article/dn16518-aci...

http://metamodern.com/2009/02/01/ocean-acidific...

"I believe that this nation should commit itself to achieving the goal, before this decade is out, of landing a man on the moon and returning him safely to the earth. No single space project in this period will be more impressive to mankind, or more important for the long-range exploration of space; and none will be so difficult or expensive to accomplish."
- An adolescent statist romantic

If only government would get out of the way and stop investing in research, we might have that "information superhighway" by now, that Gore wouldn't shut up about.

And think how much faster we'd have LANDED A MAN ON THE MOON if it hadn't all been managed from the top down, crowding out all those entrepreneurs who'd undoubtedly have gotten us there, what, 5 years faster? Oh yes it's a given that no matter what the problem, massive government investment will lead to Randian poverty and Haykeian authoritarianism.

Those are all nice theories formed in the context of a world that took fascism and marxism seriously, but I'm kind of done taking nice theories like those on faith anymore. What have you done for me lately, libertarianism? Or, where are the failed democracies, the broken states and societies in the West that chose entitlements and regulation and rejected Rand and Hayek? Scare me, RTS-style.

One question Will: does being a libertarian as of 1/20/09 require intentional rewriting and disregard of history and datapoints that don't fit into your mental model (that others might understandably mistake for a kind of autism)?

Steve,

The point isn't necessarily that the private sector can get us to a particular point faster than government can (even though that might be the case). Rather, the critique is that the chosen end, e.g., LANDING ON THE MOON, isn't necessarily the most efficient use of resources, and doesn't reflect underlying consumer preferences. Maybe landing on the moon was the most effective use of all the resources directed toward that end, but there's no way to know, right? More importantly, who's to say whether that end was the right one for that time?

Markets are really good at making resources flow to their highest valued uses.As Mises put it, markets tend to satisfy the "most urgent" needs of consumers. Governments aren't as good at that job because "its" resources often flow to the most powerful or best-connected, or to whatever area is going to get an influential Congressman re-elected. And since there's no profit/loss mechanism to tell us whether government's getting it right, we're just guessing. And yes, spending does crowd out private investment at some margin, so government spending on some end means competing ends have to go unfulfilled.

That said, maybe there's no way markets can direct resources to big stuff like the moon landing, but I wouldn't write that off. And maybe there's a compelling government interest in landing on the moon NOW rather than WHENEVER CONSUMERS DEMAND IT, and if I were convinced of the interest I'd be open to that kind of investment.

No reasonable person would ever claim that, in all cases, "massive government investment will lead to Randian poverty and Hayekian authoritarianism," but it's equally silly to pretend that there's no opportunity cost to government spending or that government can just magically guess which ends are most valuable at any given time.

"Rather, the critique is that the chosen end, e.g., LANDING ON THE MOON, isn't necessarily the most efficient use of resources, and doesn't reflect underlying consumer preferences. Maybe landing on the moon was the most effective use of all the resources directed toward that end, but there's no way to know, right? More importantly, who's to say whether that end was the right one for that time?"

What is one to make of this paragraph? There's an underlying premise that economic efficiency is the chief end in life, the virtue algorithm. Then it's abandoned with a question of whether the end what right for the time (??). So what, are markets supposed to answer that? God? A quarter flip?

Maybe in this instance, it was voters in a democracy who ought to determine what was right. Or maybe it was the educated elite (your modern landed men, the kind of people the framers imagined would vote) who thought going to the moon was a great idea and led the way, and screw everyone who doesn't agree. We're going to build ourselves the modern equivalent of Titus's arch just because we can.

What drives me crazy about libertarians is this constant false reduction of everything: every social goal, every aspect of political life, community life - it's all reduced to an economic efficiency question, and how can we jam any given idea or problem into a market-oriented framing. Because markets are really cool and very effective in many circumstances, they...become the end, they tell us who was right and what is good, and this is how you get Galt and the moving-to-Canada childishness that Will commented on.

Markets are a wonderful tool for allocating resources under many circumstances, full stop. They're one good trick in a messy world of complicated problems and - gasp - other good tricks.

I get that there are "other good tricks" other than markets. That's not a gasp-worthy statement. But I am skeptical of attempts to substitute the distributed knowledge and decisions of millions of people in the extended order with those of politicians and bureaucrats.

I've never said, and I don't believe, that markets are "the end," or that they tell us who is right and what is good. What sane person would believe any of those things? Markets are a means to an end, and collective action, when it's appropriate, is another means toward other ends. Because of their ability to create wealth and make people better off, I think markets ought to be the de facto method that we allocate scarce resources. That said, collective action is probably useful when there are clear negative externalities or when free-rider problems prevent the efficient production of some good or service. I agree with Aaron Director, who said, "Laissez faire has never been more than a slogan in defense of the proposition that every extension of state activity should be examined under a presumption of error."

Reasonable libertarians don't think the state shouldn't do anything, or that markets should do everything. We're just more skeptical of state activity, and we need more - what's that word? Right, evidence - that a government activity will outperform the market before we abandon the market in favor of the government.

"I think markets ought to be the de facto method that we allocate scarce resources."

"Reasonable libertarians don't think the state shouldn't do anything, or that markets should do everything. We're just more skeptical of state activity, and we need more - what's that word? Right, evidence - that a government activity will outperform the market before we abandon the market in favor of the government."

I don't see how this isn't the broad outlines of the American economic consensus. You have to go pretty far to the left, way to the right, or get into radical populism before you find resistance to this general idea.

So at this point you're debating about what parameters in general should be used to determine when to bring in the blunt tool of government policy, or what problems of the day merit it. You're not disagreeing with the liberal on bright-line principle. Which gets at a critique I have of libertarians - when they disagree with something, they tend to jump to thinking there's a bright-line principle at stake rather than shades of difference one can compromise on and form coalitions around. This severely limits the reach of the libertarian approach, in my view. Or maybe everyone has that problem and I just feel like libertarians ought to be held to a higher standard.