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June 28, 2005

under the big tent (two)

Don Herzog: June 28, 2005

So what do the Oklahoma Democrats have to say for themselves?  They don't have a platform yet, though this May 2003 statement directs the party to develop one:  ah, Democratic disorganization.  Unlike their GOP counterparts, they don't want a flurry of constitutional amendments.  Just one:  they'd like to see the Equal Rights Amendment ratified.  But they do like spending.  Please, no snickering about tax-and-spend Democrats, or I'll remind you of the obvious riposte.

They want public education for all, with no siphoning public funds off to voucher schemes, thank you very much.  (I disagree.)  They call for 'life-long learning" and "affordable higher education," with "increased and equitable funding."  "The Democratic Party of Oklahoma demands that health care, including mental health care, be affordable and accessible for every person."  And they'd like a nationally funded, single-payer system.

But what strikes me is not the usual wish-list of spending.  It's their political economy.  The state Republicans bobbled over free and fair markets.  The state Democrats seem to bobble rather more spectacularly:

We stand in full support of economic freedom for all working people including secure jobs and businesses in a global economy.

In one view, economic freedom is the opposite of security.  Maybe the party should read up on Schumpeter's "perennial gales of creative destruction," or Marx and Engels's passionate insistence that the bourgeoisie revolutionizes everything in sight.  So this makes the party look plain stupid, or as if they want to paper over dumb old protectionism with sexier names, or as if they think their audience is so gullible that they will think contradictory good things go together.  Then again, maybe the party has a more ambitious argument up its sleeve, on which adopting certain restraints opens up new, valuable options.  (Elizabeth Anderson and I have both urged the merits of such a view.)  And they do call for

democratically-governed market economies of “fair market” capitalism.

But they don't even sketch what those nice buzzwords might mean, so it's tempting to infer they're just confused.  Or whistling in the dark.  So too I'm not sure how to sort this out:

We support economic development policies and strategies that expand opportunities for ethnic and racial minorities, innercity and rural residents and other socio-economically disadvantaged people or groups to obtain capital and technical
assistance for sustainable economic and business development at the community level.

If they're worried about poverty, then they can just call for access to credit and the like to be aimed at the poor.  I can't tell how "ethnic and racial minorities" entered the mix here.

Then again they do sound a vintage nineteenth-century American theme (but alas Edward Bellamy's Nationalist newsletter seems not to be available online):  they argue that the "mega-corporation" is the enemy of (little-r) republican self-government.

We believe our democracy is controlled and threatened by mega-enterprises and propose to put an end to this consolidation of power.  We strongly advocate legislation to strengthen controls and to increase penalties for businesses that violate the public trust.

And they have ideas about how to do that.  Their opposition to corporate welfare is shared by some on the right.  (Makes you wonder why it doesn't get done.  Makes me wonder, anyway.)  Another idea is deliriously wacky in the classic populist way:  they would

End the legal fiction that corporations are entitled to rights as persons.

I wonder if they realize just how far-reaching a legal change that would be.  On other legal changes, they oppose what's travelling under the name tort reform and deplore, as I do, "an untenable incarceration rate."

So I disagree with some of it.  But maybe because I sympathize more with much of what they write, I didn't find this statement riddled with contradictions, as I did the state Republican party's.  Partisan readers may now leap to the task of proving me blindly, complacently wrong.  Ready, set....

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Tracked on Jul 3, 2005 12:27:43 PM

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Posted by: D.A. Ridgely

they would

End the legal fiction that corporations are entitled to rights as persons.

Well, we've already ended the 'legal fiction' that human beings are entitled to rights as persons, so why not make a clean sweep of it?

Posted by: D.A. Ridgely | Jun 28, 2005 9:16:59 AM


Posted by: johnt

Maybe because Don H sympathizes with much of it he doesn't want to see the contradictions. Then again if you're a party of power grubbing failed ambulance chasers whose only goal is control as much of an economy and people's lives as possible,not caring how much you muck up,there may be fewer contradictions. Maybe. "Democratically governed market economies of "fair"market capitalism",.Don H says,I'm not sure how to sort this out". Deep breath time! What's there to sort out? They're the Democrats and they will,or want to, govern the economy,they will make it fair. Naturally it will be fairer for them,they're virtually screaming power and control at you. But if naif Herzog is confused by that statement I am at least comforted in the knowledge that he doesn't vote. He couldn't,he just couldn't.

Posted by: johnt | Jun 28, 2005 9:23:18 AM


Posted by: Sebastian Holsclaw

"But maybe because I sympathize more with much of what they write, I didn't find this statement riddled with contradictions, as I did the state Republican party's."

I suspect so, because you quote two radically opposed ideas:

"End the legal fiction that corporations are entitled to rights as persons."

"We stand in full support of economic freedom for all working people including secure jobs and businesses in a global economy."

Unless they know something no major economist I've ever heard of knows, we aren't likely to have secure businesses in a global economy without corporations.

So without even going into the text that you don't quote (which I don't have time to do this morning) we already have some noticeabley contradictory aims.

Posted by: Sebastian Holsclaw | Jun 28, 2005 10:31:18 AM


Posted by: pickabone

"Unless they know something no major economist I've ever heard of knows, we aren't likely to have secure businesses in a global economy without corporations."

That's fine, but no-one has proposed the elimination of corporations. There's a lot of air between eliminating them and ending their enjoyment of the protections of the Bill of Rights.

On its face, I find it difficult to imagine a reasonable case for maintaining this fiction. I cannot imagine the psycho-pathology necessary for someone to fail to distinguish between a flesh-and-blood person and legal entity created to shield executives from liability.

So, Mr. Herzog, please describe "how far-reaching a legal change that would be" and exactly why such a position deserves to be dismissed out-of-hand as "deliriously wacky."

Posted by: pickabone | Jun 28, 2005 11:35:52 AM


Posted by: catfish

Clearly a statement or platform means something in the context of political parties, but to expect it to be coherent is laughable. It's a document created by a committe that is partly a marketing tool, but is mostly designed to throw symbolic bones to noisy constituents. You might be able to deduce the relative power of each subgroup within the party by how much they are able to incorporate their vision into the platform, but that is about all.

Posted by: catfish | Jun 28, 2005 11:46:46 AM


Posted by: Mona

There's a lot of air between eliminating them and ending their enjoyment of the protections of the Bill of Rights.

But corporations don't enjoy those rights. The rights inhere in the individuals in the corporation. For example, it is long settled law that corporations do not enjoy a 5th Am right not to incriminate themselves, and no corporate agent can invoke the right as to the corporation. But the individual may stand on it as to him or herself.

Posted by: Mona | Jun 28, 2005 12:25:08 PM


Posted by: pickabone

Seems I was a bit imprecise (and, fine, a little inaccurate) in implying that corporations currently do enjoy the protection of the Bill of Rights. However, corporate lawyers have been arguing for exactly that for some time, as well as covering corporations under the 14th Amendment.

So, may I rephrase:

"There's a lot of air between eliminating them and preventing their enjoyment of the protections of the Bill of Rights"

I wonder, also, how is "the legal fiction that corporations are entitled to rights as persons" manifest, and how ending it would be such a "far-reaching a legal change."

Some answers to my first question can be found here, but I wonder what the regulars have to say about it.

Posted by: pickabone | Jun 28, 2005 1:06:16 PM


Posted by: AAF

pickabone writes: "I wonder, also, how is 'the legal fiction that corporations are entitled to rights as persons' manifest, and how ending it would be such a 'far-reaching a legal change.'"

I think the OK Democrats were being a little imprecise here, and DH is reading them a bit literally.

The basic legal fiction that corporations (and other legal entities) are entitled to rights at persons consists mainly of their right to enter into binding contracts, their right to own property, their right (and obligation) to reasonable care by (and toward) others (i.e., a tort can be committed against (or by) a corporation, not solely against (or by) its employees or stockholders), and their right to sue and be sued to enforce those rights and obligations. In other words, the ability to function as an independent entity in the economic sphere. This part is pretty uncontroversial, and I don't think the OK Dems seriously mean to change this.

The controversial version of "personhood" rights for corporations would give them free speech protection and other bill of rights protections. This is indeed controversial, and is what I believe the OK Dems are against.

Eliminating the first kind of personhood rights (which is how DH interepreted the stance in the OK Dem position paper) would entail radical changes in the economy, because most transactions are between corporations, or a corporation and an individual, not between 2 individuals.

Eliminating (or preventing) the second kind might not change much at all. It would undercut corporations' participation in politics, as their speech could be directly regulated -- though I wonder how far this could go, as newspapers are pretty much all run by corporations.

Posted by: AAF | Jun 28, 2005 1:47:10 PM


Posted by: Literally Retarded

I guess I don't much care what rules and regulations apply to businesses, as opposed to corporations. I have the feeling, from the context of the platform statement, that OK Dems have only focused their ire on incorporated businesses. The "democracy controlled by mega-enterprises" line is kind of a giveaway.

However, if they are going to promote this, it's only "fair" that all corporations suffer equally, including trade unions, Catholic bishoprics, 527's, etc.

Yet, somehow, that's not the vibe I'm getting from the OK Dems.

Posted by: Literally Retarded | Jun 28, 2005 1:47:42 PM


Posted by: Mona

"There's a lot of air between eliminating them and preventing their enjoyment of the protections of the Bill of Rights"
I don't understand your hostility here. A corporation is naught but a collection of individuals who come together for the purpose of business. If the entity comprising these individuals lacked the right to trial by jury, or to be protected against unreasonable searches and seizures, we would be carving out a group of individuals who in an important area of their lives lack some quite fundamental protections against government abuse.

It makes sense to me that a corporation is held not to have a right against self-incrimination -- a corporation does not go to jail and none of the individual agents of the entity are can be harmed vis-a-vis that interest by withholding that right from the entity. But they can be harmed if the government is free to storm into their offices at will, rampage through their papers, or set up wiretaps for any reason or none, just for a fishing expedition.

Would you really want the government to have those powers?

Posted by: Mona | Jun 28, 2005 2:05:45 PM


Posted by: Chris

It seems very strange to analyze a party committee in order to determine whether it's philosophically consistent (it won't be, since it's a compromise between members of a philosophically diverse group, namely a state-wide political party), and to do so without considering the context. States have issues, and often state party platforms are directed at those issues, even if the language may sound like it comes from national debates. Take, for instance, the following:

We support economic development policies and strategies that expand opportunities for ethnic and racial minorities, innercity and rural residents and other socio-economically disadvantaged people or groups to obtain capital and technical assistance for sustainable economic and business development at the community level.

You say you can't sort this out, but it's really quite simple. Federal, state, and many county and city goverments have minority, women, disadvantaged, and/or small-business programs (which all target the previous groups along with other small businesses), designed to compensate for the very real discrimination and disadvantages that minority-owned (and to a much lesser extent, women-owned) businesses face. However, most states, including Oklahoma, spend very little time and money on these programs, and only remember them when they get sued (which happens fairly frequently). It stands to reason that state Democrats would want these programs to receive more attention and funding, and, in fact, because minority businesses really do suffer in race-neutral systems, would feel that the issue is important enough to include in their platform. It's not that they're just throwing ethnic and racial minorities in their willy-nilly. They're attempting to address a very real problem that is, to a large extent, specific to ethnic and racial minorities.

Of course, this would probably be obvious if the platform were considered in context.

Posted by: Chris | Jun 28, 2005 2:25:20 PM


Posted by: Mona

To quote from the First Amendment Center's site, regarding the Supreme Court's vindication of freedom of association vis-a-vis NAACP, Inc.

When people in an expressive association object to government action on First Amendment grounds, courts consider the extent to which the challenged regulation or statute interferes with the advocacy of the group. In NAACP v. Alabama (1958), the Court concluded that the state could not compel disclosure of the group’s membership list under a statute that required such information from out-of-state corporations. In the tumultuous civil rights era, the Court recognized that divulging the names of NAACP members would expose them to attack and so undermine the ability of the group to advocate its message.

Should the NAACP be denied 1st Am association rights because it has chosen to come together as a legal fiction, namely, a corporation?

Posted by: Mona | Jun 28, 2005 2:52:27 PM


Posted by: pickabone

Mona,

You've mis-interpreted the FAC's quote here, specifically overlooking the portion that reads, "divulging the names of NAACP members would expose them to attack and so undermine the ability of the group to advocate its message." The primary objection is the endangerment of the individual members. The protection of the group itself is secondary, and the group has no standing itself to enjoy free association. Rather, the organization is the result of such protected association by individual members.

"If the entity comprising these individuals lacked the right to trial by jury, or to be protected against unreasonable searches and seizures, we would be carving out a group of individuals who in an important area of their lives lack some quite fundamental protections against government abuse."

This "area of their lives" also comprises a space where these same individuals are shielded from certain liability. There's a trade-off. Otherwise, they'd be carving out a space where they enjoyed certain privileges without being bound by normal legal obligations.

Search and seizure protections would still inhere to the individuals of the corporation, and to their own offices and homes and any such place where the individuals warranted an expectation of privacy. Likewise the right to trial by jury. Nowhere do I advocate the elimination of the rights of personhood for individuals who happen to have formed or joined a corporation.

Posted by: pickabone | Jun 28, 2005 3:41:26 PM


Posted by: noah

Well, we got McCain-Feingold didn't we (restricting the speech rights of corporations except that it didn't work very well)...how many people left or right are happy with it? More big fee work for lawyers and new opportunities to fling charges of hypocrisy against ones political opponents. Whoop tee do.

Posted by: noah | Jun 28, 2005 3:49:48 PM


Posted by: Mona

Offing italics.

Posted by: Mona | Jun 28, 2005 4:09:38 PM


Posted by: pickabone

offing bold.

Posted by: pickabone | Jun 28, 2005 4:15:23 PM


Posted by: Mona

pickabone: You did not answer my question- should the NAACP be required, by virtue of its being a corporation, to give over its membership list? How about only those who have ever sent it so much as a dollar? After all, the NAACP did not have to avail itself of the benefits of incorporation, but it chose to. And if corporations enjoy no protection against unreasonable search and seizure, why should the govt not have simply raided the NAACP offices to acquire everything, including membership lists?

So, do you think the govt should be able to, at will, wiretap the NAACP's fones? Barge into its corporate offices and raid its files? After all, it is only a legal fiction.

Why is it that you think when individuals form into an entity called a corporation, their interests in not being subject to unreasonable searches and seizures at their corporate office should be forfeit? Why should the economic benefits of incorporating render forfeit basic constitutional protections? Do you really think the police should be able to willy-nilly raid corporate offices, and wire tap their fones, whether the corporation is the NAACP or Cleaning Services, Inc. in your hometown?

What is the nexus between the benefits acquired by incorporating on the one hand, and any justification in permitting the govt to behave in ways the Bill of Rights was meant to preclude, on the other?

Posted by: Mona | Jun 28, 2005 4:28:27 PM


Posted by: pickabone

You completely, and I can only assume willfully, ignored my answer to your question and likewise utterly mis-represented my statement. Maybe I should give you the benefit of the doubt and say that it might have been the text formatting that altered your perception.

Here it is again,

"Search and seizure protections would still inhere to the individuals of the corporation, and to their own offices and homes and any such place where the individuals warranted an expectation of privacy. Likewise the right to trial by jury. Nowhere do I advocate the elimination of the rights of personhood for individuals who happen to have formed or joined a corporation."

My objection is to creating a right for the corporation separate from the existing rights of its individual members. Practically speaking, where no individual members rights are threatened, the corporation should not be allowed to avail itself of the protection of the Bill of Rights, the 14th Amendment, or any such provision of the Constitution dealing w/ individual rights. Certainly, corporations rightfully enjoy basic statutory rights of property, which include certain forms of privacy among them, but these can be differentiated (sometimes easily, sometimes not) from individual rights of personhood.

As for your NAACP example, the individuals are either protected by implicit privacy rights or explicit privacy protection agreements offered by the organization. Nowhere do I advocate stripping the corporation of its obligation to uphold its own legally entered upon agreements.

You overshoot the valid aspects of your point by engaging in a bit of indulgent hyperbole, but let me offer a spot of common-ground. Search and seizure protections for the individual do seem to overlap with statutory property rights accrued to the corporation (and most other organizations people form). More divergent are the rights enshrined in the first and fourteenth. Not accidentally, these are the two which the corporate personhood movement seem most interested in having recognzied for corporations.

Posted by: pickabone | Jun 28, 2005 4:58:59 PM


Posted by: Perseus

I wonder how the Oklahoma Democrats plan (and they do like government planning) to create all of this economic development and opportunity while at the same time spend all of this extra money, add a host of new environmental regulations and programs (including ones to bring "an end to suburban sprawl"), support the "family farm" (doesn't Don Herzog dislike subsidizing family farms as well? I don't like it much myself), etc. Though this is just as implausible to me as some of the paleo-con types who seem to have an excessive nostalgia for agrarianism/ruralism (Ugh).

Posted by: Perseus | Jun 28, 2005 7:26:09 PM


Posted by: D Lee

the Oklahoma Democrats ... like government planning ... [which would] create ... a host of new environmental regulations and programs (including ones to bring "an end to suburban sprawl") ... Though this is just as implausible to me as some of the paleo-con types who seem to have an excessive nostalgia for agrarianism/ruralism (Ugh).

Is planning inherently bad, and if so, why? Should we eschew our rational faculties and simply give ourselves over to chaos and anarchy for fear that the plan might go wrong? I would argue planning isn't inherently good or bad, but that specific plans may turn out good or bad (resulting from the "law of unintended consequences" that conservatives so love to point out to progressives, yet resist applying to their own policies.)

If a plan to, for example, slow suburban sprawl is "implausable", the chief reason that it is so is because of people like yourself who believe it is impossible. As long as broad sectors of society give themselves over to naturalism - that is, the belief that the way things are is the way they must be - then it is a self-fulfilling prophecy.

We unconsciously make our beliefs reality; we are, to some degree, in control of our beliefs; therefore, we are in control of aspects of reality that stem from our beliefs. To prefer anarchy to rationalism is a choice. It is grounded in a pessimistic valuation of humans' rational capacities. The irony is that by over-stating the limits of reason many people prevent its' full exercise.

If you disagree with a specific plan, the onus is on you to say why you don't think it will work, or why the goals it seeks to achieve are not laudable. The argument against planning in general, however, is untenable. It generally rests on claims such as "we tried welfare and it didn't work, therefore welfare won't work." The problem with claims like these is twofold. First, they contain a leap in logic from a particular plan to planning in general that isn't warranted (examples of relatively successful planning, such as our system of public roads, are ignored.) But more importantly, it rests on the old mistaken belief that correlation implies causation.

If a welfare plan is in effect while the situation of the poor deteriorates, it does not follow that the welfare program helped cause the deterioration. In order to complete the argument, conservatives make sweeping claims to knowledge about human psychology, such as "receiving a welfare check in the mail induces the recipient to not work." Assertations like these are based on deeply-held assumptions about human nature, assumptions about which humanity is far from being in agreement, and which empirical evidence can rarely answer definitively. (For example: "The poor generally do not want to work." "People like living in the suburbs, so halting suburban sprawl is not realistic.") As long as you take the underlying assumptions to be reality - rather than merely human beliefs - the arguments which follow from them become self-fulling.

Posted by: D Lee | Jun 28, 2005 8:13:06 PM


Posted by: D Lee

Hmm, I could've swore I turned off that italics.

Posted by: D Lee | Jun 28, 2005 8:14:05 PM


Posted by: Jadagul

First, let's see if that gets rid of the italics.

Posted by: Jadagul | Jun 28, 2005 8:43:06 PM


Posted by: Perseus

I didn't say planning in general. I said *government* planning, and I have plenty to reasons to reject such planning on grounds of both limited government (even if I were certain a particular plan would work, it doesn't mean that the government should do it) and efficacy.

The quote said *end* suburban sprawl, not slow it, and they don't put forward a plan on how to end it, so it's not incumbent on me to try to poke holes in a non-existent plan even assuming that the end is justified (and they don't tell us why it's the government's job to try to end it).

As for human nature, yes, many philosophes scoff at the idea, but their historical track record of fashioning a "new man" isn't very impressive.

Posted by: Perseus | Jun 28, 2005 8:56:58 PM


Posted by: Larry

D.Lee: [The argument against planning in general] generally rests on claims such as "we tried welfare and it didn't work, therefore welfare won't work."

No, the argument is more comprehensive and more widely based, and includes, among other things, the idea that manipulating human beings as though they were parts of an engineering project is wrong. But, as just one small aspect of the argument, you might be able to say something analogous to your example -- e.g., the Soviet Union tried planning and is no more; China tried planning and has abandoned it for capitalism; Cambodia tried planning and slaughtered nearly a quarter of its own population in a failed attempt to make it work; North Korea is still trying planning and its people are starving (did make a nuke, though!).

Welfare states also "plan", of course, but they also give varying latitude to the unplanned (i.e., market-based) production and exchange of goods and services -- their economic, social and political records are better than the above horror shows, but would that be because of the planning? Or might it be in spite of it?

As a footnote, what's at issue here is not planning per se -- to plan is a common and indispensible human activity, carried on by indivduals and by groups. The issue here is state planning, which is inherently coercive, and frequently done to serve the interests or values of one group at the expense of another.

Posted by: Larry | Jun 28, 2005 8:58:46 PM


Posted by: Jadagul

Oh, good, they're gone. Now, to respond to your post, D Lee: there are two reasons why planning (government planning, specifically) is typically bad. There are exceptions, but these two reasons imply that government planning is generally a bad idea and should be avoided when unnecessary.

First, plans involve a certain amount of paternalism. As Elizabeth Anderson argued here, any plan that tries to achieve a distribution of goods of some sort requires the government to judge what people should desire and what they shouldn't. Ms. Anderson points out that trying to distribute goods according to merit or hard work requires following people around, deciding how meritorious their actions are, and whether they've worked as hard as they ought.

Similarly, if the government plans to eliminate suburban sprawl, for instance, it's telling people what they should want. I personally hate suburban sprawl; I want to live in the middle of a city, where I won't ever, ever have to drive a car, and rarely will have to get in one. I prefer walking. But I know lots of people who love driving and wouldn't want to walk all over the place. If a government institutes a plan to prevent suburban sprawl, it screws them over. If it institutes a plan to encourage it and prevent dense urbanization, it screws me over. If it plans for a mix between the two, it has to guess how much of each is needed, and where, and in what form and...

Which brings us to the second, stronger objection, which Hayek and von Mises explicated quite well. Specifically, no government, or central planning agency of any sort, can accumulate enough information to make good decisions about most topics. Markets, in contrast, are phenomenally efficient and effective machines for taking up the data of everyone's preferences and figuring out what we should produce and where we should put it. No one has to decide how many suburbs and how many cities we should have; instead, people just try to buy houses where they want to live, and developers try to build the kind of houses people want to live in (Actually, because of zoning etc. that doesn't actually happen. That's one reason that we probably have so much suburban sprawl, and that it's really hard to find a place to live in a denser environment—all sorts of regulations deter developers from creating that kind of density. But that's how it could work).

No central plan can detect and respond to people's individual, myriad preferences nearly as well as a market can; so for the most part it's better to let markets sort out how to satisfy those preferences. The government should only be called in when the market specifically fails, and you can show why a government plan can improve things. So, in short, I guess the answer to your question is that you misplace the burden of proof: "the onus is [not] on [me] to say why [I] don't think it will work," but on you to say why you do.

P.S. Larry and Perseus make good points too—especially the fact that the problem isn't planning in itself, but government planning specifically.

Posted by: Jadagul | Jun 28, 2005 9:02:15 PM


Posted by: johnt

Kelo v City of New London. Let it sink in. I wonder if the Oklahoma Democrats have anything to say about that,being interested in fairness,the little guy and all that mush. Perhaps that's what they have in mind for the big corporations,life being full of surprises. The Ny Times,beacon of fairness,families,and flatulence,thought quite highly of it. So it seems the power of corporations has taken a quantum leap forward despite the efforts of the right wing,reactionary,extremists who sit on the court. Wake up people,nobody did a survey on which resident was a Republican and which a Democrat. The Liberal steamroller is non-discriminatory,it doesn't care who it crushes.

Posted by: johnt | Jun 28, 2005 11:02:51 PM


Posted by: lucky

Markets....are phenomenally efficient and effective machines for taking up the data of everyone's preferences and figuring out what we should produce and where we should put it

Yes, and thus according to consumer-preference designed economies it would seem, at least on the west coast, casinos (if not whorehouses) are what should be produced, and they should be put whereever they can turn a profit, eh, and offer some minimum wage "careers" to the locals.

Posted by: lucky | Jun 29, 2005 12:44:12 AM


Posted by: Jadagul

Caligreen: I started writing a response to you. That was an hour and a half ago. It got a little out of control. So rather than take up an obscene amount of space on the blog Professor Velleman and company have kindly allowed us to comment on, I posted the commentary on my own blog, where I can be exactly as pedantic and long-winded as I like. Hope to see you there!

Lucky: I don't really know why, but people seem to like casinos. They like casinos, but the supply of casinos is artificially restricted because the government most places won't let people build them...so on the rare occasion that someone is allowed to build a casino, he makes a killing. That's what you're seeing in Vegas--a few guys profiting from really silly government interventions.

Now, you could say people shouldn't like casinos, but then you're putting someone in charge of telling everyone what he or she is supposed to like. That's dangerous: what if he decides that no one should like posting on moderate-left political blogs? What would we do? You're walking dangerously far down the Road to Serfdom, my friend.

Posted by: Jadagul | Jun 29, 2005 5:19:43 AM


Posted by: Larry

Caligreen: Attacks on planning and economic controls or market regulations are generally motivated by self-interest and protectionism on the part of the of the wealthy, not on a minimal utilitarian consideration that planning might be more beneficial to larger numbers of people than free market capitalism.

Curious, that. So why weren't those "minimal utilitarians" in the former Soviet Union able to benefit "larger numbers of people than free market capitalism"? There I go again, with the patronizing tone, I suppose. And I don't imagine that either a tone, or reason, or evidence, or anything at all, would shake the fundamentalist faith of the populist crowd, who are reduced now to a visceral "eat the Rich" mentality and mutterings about casinos and "whorehouses". But for anyone else, anyone with the slightest of open minds, you might wonder again why "planning" so often does so badly for the very people it purports to help (e.g., rent controls), and why free markets are so often able to lift entire populations out of squalor. In fact, let me throw out the following bit of subversive heresy: what if it turns out that, contrary to the superficial posturings of both sides, it's precisely planning that really benefits the Rich-and-Powerful, since they're ususally in a position to control it (that's why they're called "the Powerful"), and since it locks in their privileged status; whereas, it's precisely freedom that threatens the RichandPowerful (with, as Don Herzog points out, those uncontrollable gales of "creative destruction"), and most benefits the Poor who would like not remain poor, and all those with nothing to lose but their chains? Hmm?

Posted by: Larry | Jun 29, 2005 6:32:12 AM


Posted by: Larry

caligreen: With no planning, no partnership with the colleges or training providers, there is this glut of IT people.

Only until those extraneous "IT people" stopped whining, and started looking around for something they could do that someone would be willing to pay them for.

Of course, it would be better for them if they could get a bureaucrat to command others to pay them whatever they felt they were worth -- it would just be a drag for, and a drag on, everyone else. And of course, that's only one of the many, many ways in which "planning" could improve the lives of the extraneous IT people. And maybe some others.

Posted by: Larry | Jun 29, 2005 10:08:57 AM


Posted by: D Lee

[Why is that normal HTML tags will turn something on, but not off?]

"in short, I guess the answer to your question is that you misplace the burden of proof: "the onus is [not] on [me] to say why [I] don't think it will work," but on you to say why you do."

I tried to make it clear that I think it's ridiculous to argue about "planning". Narrowing it down to "government planning" gets you a little bit further, until you take into account that governments are all different. Some are more democratic - i.e. responsive to the needs and wishes of ordinary citizens - than others.

Libertarians' disdain for government rests on the assumption that governments are inherently corrupt and inefficient. My argument is that if this is so, the primary reason for it being so is the *belief* that it is so, on the part of libertarians, conservatives, capitalists, and other anti-government types. The belief leads to apathy and becomes a self-fulfilling prophecy. Apathy leads to not paying attention to what's going on in the capitol. No accountability means no incentive not to be corrupt, and suddenly everything you thought was true about government is true.

In my view, the efficacy of a government plan depends much more on the attitude of the citizenry than on the government (the government being, as I just argued, also a product of citizens' attitudes.) If the moment the government announces they are going to attempt a plan to alleviate a problem huge swaths of society have the knee-jerk response of "There goes that damned government again, thinking they know best for everyone," the plan's chance for success goes down.

The old line that private enterprise does things better than government as a rule needs to be laid to rest. Governments do not have a monopoly on greed and corruption. Such vices thrive where the populace is apathetic, and they thrive in more than one environment. Change must happen with the population, and that's what I was arguing. Sweeping claims about government are meaningless. Governments go bad when the people don't hold them accountable. To the degree that the government has the interests of the greatest number in mind, what it does will be virtuous. I am just as ready as any anti-government type to admit that governments rarely have the interest of the greatest number in mind. I just think the solution is not to fight the very idea of government, but to make it more responsive to the people. In short, if more people believed in government it would have much better result.

Posted by: D Lee | Jun 29, 2005 12:16:48 PM


Posted by: D.A. Ridgely

The question is what sort of planning we are considering. Even libertarians want the government to plan whatever it is required to do, so the notion that no one wants government to plan in furtherance of legitimate government functions is simply wrong. Corruption is part of the human condition. It certainly doesn’t exist uniquely inside government, but there are systemic reasons why it is often more difficult to curb government corruption than corruption elsewhere, one of them being the sheer size of the institution, another being the fact that the incentive structure for government personnel is different and less straightforward than for those working in a for-profit environment. (Nonprofits are a mixed bag here, but many nonprofit organizations nonetheless compensate personnel on the basis of performance and with greater latitude than typical governmental personnel systems permit.)

Where government is not merely accidentally or derivatively inefficient but necessarily inefficient is when it undertakes to plan social and economic activities that would otherwise be ‘regulated’ by market forces. Any so-called command economy (that is, one in which the state sets prices, determines quantities, etc. of goods and services that would otherwise be secured through private transactions) will necessarily fail by comparison to its market alternative because it will never have sufficient information nor will it be able to react to that information as quickly as a free market will. What should a pair of shoes cost? How many size sevens should be made? Where should they be shipped for purchase? Etc., etc. No government agency, no matter how much it sought to be responsive to its citizens’ desires, could possibly make decisions about these and literally millions of other supply / demand questions that are routinely decided every minute by prices in a free market, thus no government agency can hope to be nearly as efficient. Now, maybe efficiency isn’t the end-all, be-all of human activity; but as between the state and the market there is simply no question why the latter is preferable to the former whenever some overriding concern doesn’t drive us to be willing to make a sacrifice in terms of efficiency.

Posted by: D.A. Ridgely | Jun 29, 2005 1:35:35 PM


Posted by: Jadagul

D Lee: Mr. Ridgely got it exactly right. Even if you assume away government corruption, and get everyone to wholeheartedly contribute to the common good with no thought for screwing the system, government planning still does not and cannot work. Hayek and von Mises showed quite convincingly that without prices, it is literally impossible to allocate resources with any reasonable degree of inefficiency. Even the Soviet Union only tried true socialism for about two years; it was a complete disaster, and they went back to working with a (really dumb and inefficient) price based system. The only difference was that one 'corporation' owned all the stuff, controlled all the jobs, set all the prices—and had all the guns. That's a bad setup.

Posted by: Jadagul | Jun 29, 2005 2:35:41 PM


Posted by: Larry

D.Lee: Libertarians' disdain for government rests on the assumption that governments are inherently corrupt and inefficient.

"Libertarians", as I understand them (and I'd somewhat reluctantly accept such a label myself), don't disdain government at all -- they see government as a necessary rule-setting institution. They are, however, wary of government (aka the state), and concerned to keep it limited to what it's needed for -- not because governments are inherently corrupt, and not even, or not simply, because they're inherently inefficient (though, for a number of systemic reasons, they are). Rather, the reason for the concern, to my mind, lies in the inherent association of the state with coercion, force, threat, and violence (which is then often enough a primary source of the derivative vices of corruption and inefficiency). Contrast that with the abstract notion of the market, at the basis of which is the trade, which by definition is voluntary and cannot occur without both or all parties believing that they are in some sense benefited by it.

Posted by: Larry | Jun 29, 2005 3:07:14 PM


Posted by: Perseus

"To the degree that the government has the interests of the greatest number in mind, what it does will be virtuous."

I have two problems with that statement. First, doing what's in the interest of the greatest number can just as easily amount to majority faction. Second, even if it does something with the interests of the greatest number in mind (assuming that what it does is a legitimate function of government), it doesn't necessarily mean that what it does will be virtuous. What it does could be spectacularly incompetent or inefficient. Good intentions are not enough.

Posted by: Perseus | Jun 29, 2005 3:19:05 PM


Posted by: pickabone

Jadagul,

I'm straining to see you intrepret this:

"Now, maybe efficiency isn’t the end-all, be-all of human activity; but as between the state and the market there is simply no question why the latter is preferable to the former whenever some overriding concern doesn’t drive us to be willing to make a sacrifice in terms of efficiency."

as meaning this:

"government planning still does not and cannot work."

While Mr. Ridgely's statement certainly leans significantly toward the market, he leaves a tremendous amount of room for debate in the form of a "some overriding concern" exemption to his market-oriented preference. Those of us who have refrained from drinking the Kool-Aid served by the left (viz Marx) and the right (viz Hayek) recognize the folly of sweeping pronouncements about government planning ALWAYS failing or free markets ALWAYS exploiting the masses.

The truth is that markets sometimes fail, and in certain areas (health care, education, energy, transportation, and more), failure is not an option. This is why the gov't has a strategic petroleum reserve, medicare, public schools, and a federal highway system. Most reasonable people see room for, at the very least, the gov't having either a backup plan or a minimum acceptable standard, even in a market-based system. Anyone who doesn't hasn't looked hard enough at history to comprehend the damage a market failure can do. In short, we should (and most do) choose to accept a degree of inefficiency in exchange for protection against total collapse.

Posted by: pickabone | Jun 29, 2005 3:43:34 PM


Posted by: noah

Facts:

1) gotta Wal-Mart in town...they have by no means destroyed jobs as far as I can tell. (At least there are plenty of local businesses which also pay minimum wage that are still open in what has been traditionally a low wage business for non-owners anyway).

2) Microsoft's monopoly is clearly under attack by companies producing better products. Whether Microsoft's flagship OS will ever be displaced is another question.

3) McDonald's clearly has lost market share.

So much horsefeathers so little time. But us cryto-fascists have better things to do.

Posted by: noah | Jun 29, 2005 5:11:11 PM


Posted by: Jadagul

Pickabone: you're right, of course, that I'm indulging in sweeping overgeneralization. When I say "government planning cannot work," I'm referring to top-down, centralized economic planning, intended to replace rather than supplement the market. There are many things the government really cannot do with any reasonable effectiveness, like decide what styles of clothes people want, and how much of each style, and so on (or, per Mr. Ridgely, "No government agency, no matter how much it sought to be responsive to its citizens’ desires, could possibly make decisions about these and literally millions of other supply / demand questions that are routinely decided every minute by prices in a free market"). That's why we can't function without markets.

Of course, there are places where we have government and, I think, should have government. I support a police force, an army, a court system. I think we should have pollution controls, although the specific types we have now are pretty stupid. I'm in favor of anti-fraud regulations, provisionally in favor of some public good provision, and open to persuasion on anti-trust laws and competition-encouraging regulatoins (though those seem incredibly vulnerable to regulatory capture). I'm even willing to allow a (efficient, lean) safety net, though I view that more as a compromise than as a truly desireable policy.

I suspect we disagree about what, specifically, the government should be involved in, but not because of any deep-rooted philosophical differences. I would love it if the government could guarantee everyone a good, solid education. Unfortunately, as far as I can tell, its attempts have led to minimal improvements at best, and arguably made things much worse, at great cost.

Same with healthcare: I'd love to have free healthcare for all, but from what I can tell getting the government even more deeply involved will just make things even worse (and a single-payer healthcare system would only exacerbate the problems caused by our current third-payer system; see Harvard Business Review, June (I think) 2004).

I'd love for the government to solve all our problems. But for very fundamental reasons, it has trouble helping with a lot of stuff. I'm a libertarian because I place a high burden of proof on someone advocating a new plan: you must show that it will work, why it will work, how it's different from all the other plans that haven't worked ("we'll spend more money" doesn't count), and what will make it work (better than the alternative) even if complete incompetents are put in charge (you don't give the government the powers you'd want it to have if you're in charge; you give it the powers you'd want it to have if someone you don't like and don't trust is in charge). Police meet this burden, as does limited environmental regulation, and fraud protection; state-run education probably doesn't.

Posted by: Jadagul | Jun 29, 2005 5:43:09 PM


Posted by: D Lee

I see lots of people arguing against government economic planning, but who was ever arguing for that in the first place? (Forgive me if I overlooked it; I can't re-read every post five times a day.) I certainly was NOT arguing for government planning of the economy.

"The truth is that markets sometimes fail, and in certain areas (health care, education, energy, transportation, and more), failure is not an option."

More importantly, markets often never even try in the first place. No profit, no dice. The government should take up the slack for things that benefit society but cannot be accomplished by the market. Chief among such things are long term concerns (for example, climate change or urban sprawl) that markets do not take into account. Actors in the free market have short-term selfish interests in mind. Governments, in theory, have society's long-term interests in mind.

Again, I don't see anyone arguing that the government can run an economy better than the free market. What I do see is an oft-comitted leap in logic by some on the right: "Because markets are best at regulating commercial activity (i.e. prices, rents) they should, by default, be our preferred mechanism for solving all of society's problems." Such a view is naive at best; there are many things that's markets don't care about and never will care about, but which have profound and far-reaching effects on society - and, indeed, the entire world.

Consumer wants are not the end of the discussion. I don't care what consumers want if they're harming others. We don't indulge some people's "want" to rape and murder because we recognize these acts are immoral. Some of us think that the social and environmental effects of owning a huge house in the suburbs and driving a huge vehicle are also immoral. Markets cater to wants without regard to their moral character and therein lies the problem. Unless you don't believe in morality, you must believe the government has a vital role to play in regulating the economy, among other things.

Posted by: D Lee | Jun 30, 2005 12:08:45 AM


Posted by: Bret

D Lee wrote: "Some of us think that the social and environmental effects of owning a huge house in the suburbs and driving a huge vehicle are also immoral."

And others think that not being Christian and not going to church on Sundays is immoral. Should we therefore become a Christian nation and enforce the laws of the bible?

I'd be very hesitant to advocate that the government should enforce morality. You might not like where that road leads.

Posted by: Bret | Jun 30, 2005 12:43:42 AM


Posted by: Bret

caligreen wrote: "Walmart runs an efficient retail monopoly which efficiently closes all the small businessmen in whatever town Walmart takes root..."

Really? Walmart's been here in San Diego for a long time (several of them), but a quick glance at the 1800 page long yellow pages for San Diego reveals many thousands of other retail establishments. Indeed, there are over 100,000 businesses listed in San Diego. Walmart has a bit more work to do before they "close all the small businessmen" here in San Diego.

Other caligreen claims also defy belief:

  • McDonalds in charge of burgers: has he/she never heard of Wendy's, Burger King, In & Out, Jack in the Box, Carls Jr., etc., and, not to mention my favorite Mom & Pop burger place - Jeff's Burgers at La Jolla shores?
  • Budweiser in charge of beer: has he/she never heard of Miller, Coors, Heineken, Becks, Molson, Corona, etc.?
  • Ford in charge of pickups: has he/she never heard of Chevy, Toyota, Nissan, Honda, etc.?
  • Hustler in charge of porn: well, this one I don't really know (or care), but is Playboy, Penthouse, and the fifty other porn mags that I see at Bookstar and all the Internet porn really all owned/controlled by Hustler?
What planet does caligreen live on where his/her handful of monopolies control things as he/she described?

Posted by: Bret | Jun 30, 2005 1:13:23 AM


Posted by: Jadagul

I would argue planning isn't inherently good or bad, but that specific plans may turn out good or bad...If a plan to, for example, slow suburban sprawl is "implausable", the chief reason that it is so is because of people like yourself who believe it is impossible...If you disagree with a specific plan, the onus is on you to say why you don't think it will work, or why the goals it seeks to achieve are not laudable. The argument against planning in general, however, is untenable.
D Lee, I apologize if I misread you; I took this to mean you 1) supported government economic regulation and planning in some unusual spheres, and 2) thought there should be no presumption against economic planning (yes, the structure of real estate and urban/suburban development is economic). The purpose of my arguments—which may have failed miserably—was to argue there should be a strong (but rebuttable) presumption against government regulation and planning. The presumption is, I believe, handily rebutted in the arena of interpersonal violence; in other cases the decision isn't quite so clear-cut.

First, private market forces certainly are capable of dealing with long-term benefits (check out Xerox PARC, or Bell Labs, or, for that matter, the entire venture-capital and pharmeceutical industries). Still, as I said, I'm provisionally in favor of governmentally provided public goods, in limited circumstances. I'm still kind of waffling.

More importantly, almost all the concerns you list (or can list) fall into one of two categories. First, there are physical externalities, like pollution. I think the government should regulate pollution for the same reason it should regulate the dumping of poison onto someone else's property. Similarly, if someone can show conclusively that

  1. Climate change will have identifiable negative impacts
  2. There's something we can do to prevent these negative impacts
  3. The costs of preventing the impacts are less than the costs of the impacts themselves
then I'm all for it. That burden hasn't been met yet.

Finally, you're making an error common to most people who lack experience in economics (though I don't know whether that applies to you): you separate between economic and non-economic problems. Almost all issues are economic issues in some way; the basic goal of public policy is/should be to satisfy as many preferences as possible without violating rights.

The arguments I've made so far, about the flaws of planning, imply that markets are generally the best way to satisfy preferences effectively, given clear and enforceable ownership titles and an absence of coercion. The government's role is to provide those two services, to ensure rights are protected along the way,and potentially to solve some collective action problems; when it tries to do more its efforts go awry.

For instance, you claim that "owning a huge house in the suburbs and driving a huge vehicle are also immoral." I claim that owning a huge house in the suburbs and driving a huge vehicle are silly; it's much better to live in an ultradense urban environment and walk as much as possible, because driving is an all-around miserable experience and I wince whenever I get into a car (of course, you also want to prevent urban sprawl. I'd like to encourage it). However, many people disagree with me, and for some strange reason they like living in large houses in the suburbs. Now, if they're causing direct harm to others, that's one thing; I kinda like gas taxes, as a charge on the emission of pollutants. But insofar as it causes aesthetic disapproval, it's none of your (or my) business. They live in suburbs and get what they want; I'll live in NYC or some such and get what I want.

So to answer your question, I believe in morality very strongly. I also believe, as Bret so kindly pointed out, that most moral considerations are totally irrelevant, and the government shouldn't touch them.

Posted by: Jadagul | Jun 30, 2005 1:24:57 AM


Posted by: D Lee

"the basic goal of public policy is/should be to satisfy as many preferences as possible without violating rights."

I agree 110%. And often the best way of achieving that goal is to leave the market alone. But libertarian-conservatives arbitrarily place the "right" to retain whatever property one has acquired above the "right" to, say, live free from hunger or asthma. We as a society decide what rights people have, and how valuable they are vis-a-vis one another.

"The presumption [of government interference in individuals' proclivities] is, I believe, handily rebutted in the arena of interpersonal violence; in other cases the decision isn't quite so clear-cut."

You're right, bodily violence is the most clear-cut example of why people shouldn't just get whatever they want; that's why I used it. That having been established, we move on to other, more difficult moral questions. And no, to respond to the person above with the fearful slippery-slope argument, religion is not a moral issue - until somebody chooses to act on it. But that's a debate for another thread.

It seems you are given over to an extreme skepticism where, unless you can see the physical effects of one person's action on somebody else first-hand, you doubt that such effects even exist. But of course they exist. They are simply, as you point out, harder to sort out than cases of "interpersonal violence." But - humor me for a moment - what if the empirical evidence made an exceptionally strong case that suburban sprawl was negatively impacting the physical health of everybody - even city-dwellers who have made the opposite choice? How does "the market" solve this problem, especially when the ones who are pushing their pollution onto others are the ones with more money and, thus, more power in the marketplace?

It seems to me many people are quick to lash out against the power a government overtly exercises, yet have no problem with the covert, de facto power that wealth inevitably bestows on individuals. What some people don't want to recognize is that the state of any market, at a given time, doesn't simply owe to laudable entrepeneurship (alongside "artificial" government interference.) It also owes to the coercive historical events which formed its initial conditions. And I know of no case where those events were not, on the whole, unfair and unjust.

These events have profound and lasting effects. To argue that the poor in a society owe their condition entirely to themselves is to completely ignore history. Once established, the status quo tends to perpetuate itself and resist change. Government may facilitate this tendency or seek to correct it. These absolutely are moral issues, but they have little to do with religion.

None of us live in a vacuum; all of our actions have effects on others, to varying degree. When those effects are harmful or infringe on others' rights you have a moral problem. And as Sartre and Rush both remind us, "If you choose not to decide you still have made a choice!" The pro-market argument generally amounts to an argument for a status quo that is inherently, to some degree, unjust.

Let's not fall into simplistic black-and-white thinking. Neither markets nor governments are entirely just or unjust. The character of specific cases owes to many factors. We should take all these factors into account, clarify our moral goals as a society, lay dogma to the side and use the best empirical evidence available to work out the most likely way to reach those goals.

Like individuals, governments don't operate in a vacuum. I believe citizens' receptivity to government's plans is probably the most important factor determining their success or failure.

Posted by: D Lee | Jun 30, 2005 4:44:45 AM


Posted by: Jadagul

D Lee, I actually think we agree on more than it seems. I agree that suburbanites should pay for the pollution they cause—if it can be shown to exist. If you can show that they're causing harm, through pollution etc. then they should be penalized (preferably with an effluent tax, since that doesn't distort market signals much). But as long as the harm is only aesthetic and philosophical, no sale. That's the sort of thing I worry about with declaring suburban living unethical, and that's where the comparisons to religion come in.

I agree that the argument, "The rich and poor are wholly responsible for their differences and deserve them," is naive and simplistic. Certainly some rich people have earned every penny. Some poor people deserve poverty because of stupid and irresponsible decisions. But many rich don't have a moral claim to be rich, and aren't rich through superior desert. I certainly didn't "deserve" to be born to a well-off (if not exactly 'rich') family. On the other hand, neither did any of the people who weren't. The fact that I don't have a moral claim on all my wealth doesn't mean anyone else has a moral claim on it either.

Instead, I [attempt to] make an almost utilitarian case for markets. Markets are information machines: they collect information on people's preferences, and provide incentives to satisfy those preferences. When the government interferes in the market it distorts market signals, causing resources to be allocated inefficiently. Sometimes the benefits government intervention yields is worth the cost; sometimes it isn't. But any case for government involvement has a heightened burden of proof: it not only has to show that the regulation will do good, but that the good it does outweighs the inefficiencies and deadweight loss. Government programs are guilty until proven innocent.

Finally, I think your last claim is simply false. First, if the government tries to buck the market and violate economic law, it's not gonna work, no matter how hard everyone tries. Rent control, for example: no matter what the government does, capping the price on something leads to shortages. It doesn't matter how cooperative or faithful the citizenry are. Second, your claim seems empirically false; Europeans really believe this stuff should work, and have for a long time, and it still doesn't. The government is no more able than the rest of us to violate economic law.

That said, I'm enjoying having this conversation with you, and I'm very glad that you're trying to engage me rather than giving up in disgust. Thanks for very stimulating conversation.

Posted by: Jadagul | Jun 30, 2005 5:43:00 AM


Posted by: noah

Hey, I have my gripes about Wal-Mart too. For one thing its sexist...everything that guys are interested in are in the back of the store. So if you want a tool or jumper cables be prepared to walk! On the other hand they have so much stuff that what I want is usually included!

Seriously tho, nobody is being forced to work at Wal-Mart.

The MBA types opine that Wal-Mart has transformed retail thru computer controlled inventory, volume buying, just in time delivery (logistics),etc. If you don't like the fact that you can find cheaper goods at Wal-Mart go elsewhere. But stop whining!

Posted by: noah | Jun 30, 2005 5:59:40 AM


Posted by: D Lee

"But as long as the harm is only aesthetic and philosophical, no sale. That's the sort of thing I worry about with declaring suburban living unethical, and that's where the comparisons to religion come in."

I wholeheartedly agree. Aesthetics are purely subjective, as is religion. True morality must be based on empiricism.

"When the government interferes in the market it distorts market signals, causing resources to be allocated inefficiently."

I'm not an economist, but my own experience makes me skeptical of the claim that markets are always more efficient than governments (though I don't doubt that it is usually true.) Isn't that assumption based on economic models that are divorced from reality, in that they assume perfect information on the part of producers and consumers while failing to account for consumer psychology? But assuming that markets are always more efficient, then I think you sum it up well: "Government programs are guilty until proven innocent." But I think many people don't even entertain the possibility that the benefit of a government plan will outweigh the risk. They automatically scoff at such high-minded ideals as valuing public health and safety more than profits and unlimited consumption.

"Europeans really believe this stuff should work, and have for a long time, and it still doesn't."

That's a pretty sweeping claim. Maybe it doesn't work as well for certain ends (e.g. a larger economy, higher rates of consumption) but works better for others (e.g. providing a higher minimum standard of living for all citizens.)

It's not just the government that should weigh costs and benefits. Sure the U.S. has the largest economy, our consumers have the most choices, people drive the biggest cars and build ever-larger homes. But all these things also have costs. It's not enough to say "consumers have weighed the costs and made their choice," because it becomes clearer every day that their choices affect many other people, both in their country and around the world. Capital ignores these costs and caters to consumers' wishes without regard to morality; consumers have selfish motives. Who is left to consider the long-term costs to society but government? A reduction in market efficiency may be an acceptable cost for a whole range of benefits.

Personally I think it would be much better to reduce our energy consumption, negative impact on the environment, and health problems and have a few less choices at the grocery store. Okay, people "want" to drive big cars. But what are the real consequences if they can't? How can we quantify the sorrow that a consumer feels at not getting what he or she wants? It's just coming out that Teflon may be a human carcinogen. How many other dangers are we overlooking because we value the market and consumer wishes so highly, thereby cutting our own throats by not even being made aware of the costs?

If the government did decide to try to affect change in an area like energy consumption, I think it's important to remember it's not an all-or-nothing proposition. It seems to me the key is find the policy which will have the greatest benefit-to-cost ratio. But I'm still not convinced that government regulation by necessity reduces the already-optimal efficiency of a free market. It seems to me that economic theories would apply if consumers had perfect information, but they never do. Sellers almost always have more information and more leverage, giving them power to gouge consumers to varying degree.

I'm well aware that markets are the most efficient mechanism for the transmittal of information on consumer preferences. But that efficiency doesn't extend to all aspects of a market system, does it? Affixing "free" to the market just seems, in my view, to stipulate that the person using that information will be a selfish actor. Once citizens internalize the view that selfishness is "human nature" and the only reasonable candidate for motivation, they act such beliefs out. Yes I'm waxing idealistic, but I believe that if average people started believing that concern for the welfare of your fellow humans can also be a motivator, then many things would become possible that seem ludicrous within the framework of our current assumptions about "human nature".

Posted by: D Lee | Jun 30, 2005 7:25:40 AM


Posted by: Larry

D. Lee: Yes I'm waxing idealistic, but I believe that if average people started believing that concern for the welfare of your fellow humans can also be a motivator, then many things would become possible that seem ludicrous within the framework of our current assumptions about "human nature".

No, D. Lee, you're not waxing idealistic. I don't know about you and the people you know, but for the people that I know, who are as "average" as anyone else, concern for the welfare of others is a motivator, and has always been so. So it's unlikely that that's your problem. Instead, it seems as though you simply have a particular and personal notion of what morality is supposed to mean, and you would like to be able to impose that view on everyone else, using the coercive power of the state if you had the chance. I don't doubt you mean well. I don't doubt others who have thought this way and have had the chance to use the power of the state have also "meant well", at least in their own way. But it's not something that should be called an ideal -- in fact, it's simply a vain, and in certain circumstances dangerous, obsession with one's own high-mindedness. On a meta-moral level, it's, ironically, selfish.

Posted by: Larry | Jun 30, 2005 9:36:54 AM


Posted by: noah

D Lee, this is a test.

I sometimes comment over at TCS about health care reform and have on occasion tried to peddle my own pet solution...it hinges on my beliefs in the market and reciprocal altruism.

Basically it is a voucher system using special debit cards issued to every man, woman, and child with a SS number. The debit card could be used for approved basic health card services (to be determined by the political process). But each citizen could choose to donate any or all of his balance to the debit card account of any other citizen without penalty. Each citizen would receive an equal annual amount added to his debit card balance. At $2000/citizen this would amount to $600 billion/year. Sounds like a lot but it is estimated that government plus private expenditures on health care total $1.4 trillion/year. Additionally the Federal government would mandate that every citizen purchase high deductible health care insurance with subsidies/risk pools for the poor and uninsurable. Federally chartered community organizations would monitor local health care providers and provide a clearinghouse for feedback about quality, access, fraud, etc. This organization would also have a debit card account to pay the bills of those that fall thru the cracks.

Comments?

Posted by: noah | Jun 30, 2005 9:44:10 AM


Posted by: Bret

D Lee wrote: "It seems to me that economic theories would apply if consumers had perfect information, but they never do. Sellers almost always have more information and more leverage, giving them power to gouge consumers to varying degree."

No. Exactly backwards. Buyers have leverage over sellers since the buyer knows exactly his subjective preferences, what he is willing to pay for what, the relative value of competing products to him, etc. and they don't make this information readily available to the sellers. Sellers can only try to deduce this information via price mechanisms.

However, all consumers are also sellers - they sell their labor. Here again, the buyer (employer) does have the advantage. So in this sense it may be argued that businesses do have an advantage over consumers since the businesses are the buyers of the consumers' labor. However, even here, as long as employment is more or less full (i.e. low unemployment rate), businesses end up actively recruiting, including advertising what they're willing to pay, so the employers' information ends up being relatively transparent.

D Lee also wrote: "Aesthetics are purely subjective, as is religion. True morality must be based on empiricism."

Numbers rarely speak for themselves. Someone needs to do a subjective interpretation to balance the cost/benefit tradeoffs. Indeed, the religious right points to data all the time to "prove" that we need to become a theocracy. I don't like their line of reasoning but I also don't buy into your morality that driving a SUV is immoral (though I don't own one myself). If driving an SUV is immoral because it produces CO2 then isn't breathing immoral because it produces CO2? Please start holding your breath. Thanks.

Posted by: Bret | Jun 30, 2005 11:19:20 AM


Posted by: pickabone

Bret:

"If driving an SUV is immoral because it produces CO2 then isn't breathing immoral because it produces CO2? Please start holding your breath."

Thank you for the lovely reductio ad absurdum. Wouldn't it be nice if your opponents really were so simple-minded? SUVs don't just produce CO2, they produce a lot of it, possibly more than the ecological balance can handle (in conjunction with other excessive sources). Furthermore, the amount of CO2 is unecessary given the existence of cleaner alternatives to the SUV. Then there's the issue of crude oil consumption, which breathing generally doesn't require. Oh yeah, then there's the fact that these larger vehicles pose a danger to smaller cars on the road.

Now, it's a tough stretch to apply a strict moral judgement to all SUV-owners. But I'm certainly comfortable criticizing those whose choice of vehicle imposes these unecessary sacrifices on all of us just so they can satisfy their vanity.

Posted by: pickabone | Jun 30, 2005 1:18:16 PM


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