The value of inefficiency

I think that class, culture, and ideology conflicts among the 99% tend to hurt us and help the 1%. Differences  don’t always have to lead to conflicts. Coalitions can transcend  differences and a coalition of the 99% has many differences to include and transcend.

The positions staked out by the Occupy Wall Street General Assembly all appear to be valid Constitutional, common law, and ethical positions to me.

But perhaps equally important, the 99% movement may offer us an opportunity to help each other to develop and mature psychologically and to evolve culturally.

I’m hoping for the OWS struggle to force us 99% to become more ideology-pluralistic. If we could figure out how to tolerate our diversity and agree to disagree on some issues, maybe we could develop enough common political ground to force the powers-that-be to reform in certain areas.

Beyond that, maybe each ideological group within the 99% can learn to better appreciate the value of diversity and good-faith opposition. Perhaps in some way such diversity and opposition is just a natural “separation of powers”.

In many countries, the principle of “separation of powers” is an important principle of governance.

Quoting from Wikipedia:

“The model was first developed in ancient Greece and came into widespread use by the Roman Republic as part of the unmodified Constitution of the Roman Republic. Under this model, the state is divided into branches, each with separate and independent powers and areas of responsibility so that no one branch has more power than the other branches. The normal division of branches is into an executive, a legislature, and a judiciary. For similar reasons, the concept of separation of church and state has been adopted in a number of countries, to varying degrees depending on the applicable legal structures and prevalent views toward the proper role of religion in society.”

The implicit justification for separation of powers is the goal of a counterpoised balance between opposing forces that leads to a state of stable homeostasis. The point of separation is not to create efficiency but to create inefficiency. If efficiency were the goal, we might get rid of the messy legislature and judiciary and leave all government powers to a unified executive. The independence, equality, and mutual opposition of separate branches of government preserves various values and methods that we want protected. We don’t want one one approach to governance eclipsing the others.

The separation and contra-posed balance between the public and private sectors of an economy may have a similar utility.

I think that progressives err in the false hope that big government will automatically protect them from big business, and I think libertarians err in the false hope that small government will automatically free them from tyranny.

The greatest danger to liberty is not in the balanced opposition between the public and private sector but in their collusion.

In the article “Libertarians to Occupiers: Crony capitalism is the problem | Libertarian Party ” Libertarian Party Chair Mark Hinkle says:

“I have been following the Occupy protesters, who call themselves the ‘99%’, with interest.

“It’s true that 99% of Americans do not enjoy the special benefits of crony capitalism. Crony capitalism is very different from real capitalism. In crony capitalism, government hands out special favors and protections to politically well-connected businesses.

“The TARP bailouts, Solyndra, and the military-industrial complex are all facets of crony capitalism.

“Libertarians love free markets and hate crony capitalism.

I agree about the negative consequences of “crony capitalism”. But is crony capitalism only defined as an unwholesome alliance between government and business? What about unwholesome alliances between businesses? Granted, the state can behave badly. Business can behave badly. Is the libertarian position that business behaves badly only when corrupted by the state? In the absence of state interference, in a “state of nature”, would business regulate itself in a way consistent with the public interest, the general welfare, and the pursuit of happiness by the weakest members of society?

The LP article says “A free market is where the government leaves businesses alone, does not attempt to pick winners and losers, does not stifle competition, does not hand out corporate welfare, and does not absolve businesses of liability for their actions. Most of our economy today does not resemble a free market at all.

Picking winners and losers, stifling competition, handing out corporate welfare, and absolving businesses of liability are things that government generally should not do, I strongly agree. But is opposing and correcting such abuses necessarily the same thing as “leaving business alone” entirely?

It is generally recognized that a free society is characterized by consent of the governed, and that such consent usually includes consent to a system of laws–the rule of law being a lesser evil to the rule of men or the law of the jungle (the “war of all against all” —Thomas Hobbes).

Most people agree that a free market is also a creature of law and not a creature of wild nature or of an oligarchy (a powerful or elite class). In nature, the wild marketplace is very free for the strongest but hardly so for the weakest. A market that is as free and fair for the weak as for the strong is a market of laws. A market of laws is a market with referees.

In libertarian theory, who are the makers of the laws and who are the referees if not the people’s elected representatives?

Human beings don’t live by ideology alone. They must also have peanut butter. The objective metrics of happiness and well-being are better in societies with bigger governments, higher taxes, and less disparity in wealth and income. Those things are not “natural”, nor are they good in and of themselves. We should only measure utility in pragmatic terms, in outcomes judged against our most important values and how well they are served by any particular institution, process, policy, or rule.

Where are the benefits of small government in failed states like Afghanistan, Sudan, or Somalia? Such places are ruled by tribal cronyism and corrupt warlords. I fear that a libertarian revolution would fare little better than communist revolutions have done.

Does that mean there is no room for capitalism in the US? Capitalism comes in many shapes and sizes. Libertarians and progressives can agree on the evils of crony capitalism. But other forms of capitalism also embrace questionable theories about the definition of freedom, the role of externalities, etc. It is all too common for theories of capitalism to incorporate euphamisms for injustice, theft, deception, etc. On the other hand, there are theories such as natural capitalism and cooperative capitalism that try to correct many of those faults. My own terminology for cooperative capitalism is Green Free Enterprise.

An evolving society should be an open laboratory where all economic theories (within reason) can be tested and compared. I would even like to see public and private solutions to providing goods and services compete side by side in the marketplace. Of course, to keep the public sector from taking unfair advantage over private enterprise we would need strict rules of fair play. I explore this in “Why can’t the public and private sectors just get along?

In modern society there is also room for many competing political ideologies, but there is no room for any single ideology to overpower the whole.  The US founding documents were amazingly ideology-agnostic for their time. I would like to see our future become increasingly pragmatic, utilitarian, and ideology- agnostic. But regardless, for the marketplace of ideas to stay open and free requires limits, rules, and honest referees.

A central thesis of mine is that the true backbone of human civilization and progress is not political theory or ideology but actually what is known as “common law“.

From time to time new states are formed (sometimes in revolution as was ours) and old states are re-formed to achieve closer conformity with the global evolutionary progress of common law, which traces back to pre-history, before the laws of Greece and Rome, even before the ancient code of Hammurabi. The common law represents a gradual, case-by-case resolution of tensions between conflicting rights, interests, values, and circumstances. That is the process which has produced those societies that are best and most convivial to live in today. I think that is the only process that is complex and inefficient enough to produce better societies in the future. Revolutions that have tried to establish states based on pure ideologies rather than on a reconciliation with the global progress of common law have failed.

Back to Occupy Wall Street

In the case of the Occupy Wall Street movement, I think we are hearing many diverse complaints, demands, and proposals from many sub-groups. But from the General Assembly I have seen a set of plainly and briefly stated, specific charges of abuses of power. I have not heard a call for revolution or an end to capitalism from the General Assembly. Only a list of obvious crimes and injustices and a call for redressing these grievances as simply and directly as possible.

In the US the right to petition is guaranteed by the First Amendment, which specifically prohibits Congress from abridging “the right of the people…to petition the Government for a redress of grievances.”

The positions staked out by the Occupy Wall Street General Assembly are all valid Constitutional and common law positions.

In my opinion, the Occupy Everywhere Together movement is a kind of social and economic earthquake caused by an increasing fracture between layers of society based on common law and layers of powerful special interests. Those powerful special interests exert their power both upon and through government. The line between the public sector and the private sector is not the primary fault line causing this quake. The central fault line runs between the parts of society based upon thousands of years of civilization and common law principles of justice and equity; and those cancerous parts of our society that have grown disproportionately from special interests over the past few decades.

But the cancer has already metastasized and is widely spread throughout society, as the “Stockholm Syndrome” of the Tea Party and the “53%” illustrate. It isn’t just the 1% who are corrupt. The corruption has flowed into every organ and tissue of society where mass media and popular culture could carry it. There is no simple and efficient way of treating this cancer.  There is no neat, efficient  ideological or structural cure.

We are each going to have to battle this cancer of corruption within our selves, within our own beliefs, assumptions, and lifestyles. The Occupy movement may be a venue for this struggle, not just between the 1% and the 99%, but among and within ourselves. It will be best if the Occupy Movement lasts a very long time, if it burns slowly, and it forces us to get to know our own internal diseases very intimately.

Nothing about this can or should be efficient. Efficiency does not give us the space and the time to explore the hidden corners and crevices of our diversity, complexity, and dissonance.

That is the value of inefficiency.

Poor Richard

Related:

(blog.p2pfoundation.net)

Gideon Rosenblatt and Lawrence Lessig: What to think of the framing of the #OccupyWallStreet movement as a ‘Tea Party of the Left’?

Dave Pollard on the long term prospects of the ‘metamovement’

Tim Rayner on the characteristics of #OccupyWallStreet as a swarm movement

John Robb on Real Open Source Leadership at #OccupyWallStreet

Understanding the Consensus Methodology at Occupy Wall Street

Addendum:

swampland.time.com
Q11. IN THE PAST FEW DAYS, A GROUP OF PROTESTORS HAS BEEN GATHERING ON WALL STREET IN NEW YORK CITY AND SOME OTHER CITIES TO PROTEST POLICIES WHICH THEY SAY FAVOR THE RICH, THE GOVERNMENT’S BANK BAILOUT, AND THE INFLUENCE OF MONEY IN OUR POLITICAL SYSTEM. IS YOUR OPINION OF THESE PROTESTS VERY FAVORABLE, SOMEWHAT FAVORABLE, SOMEWHAT UNFAVORABLE, VERY UNFAVORABLE, OR DON’T YOU KNOW ENOUGH ABOUT THE PROTESTS TO HAVE AN OPINION?

VERY FAVORABLE 25%

SOMEWHAT FAVORABLE 29%

SOMEWHAT UNFAVORABLE 10%

VERY UNFAVORABLE 13%

DON’T KNOW ENOUGH 23%

NO ANSWER/DON’T KNOW 1%

Q12. DO YOU AGREE OR DISAGREE WITH THAT POSITION?
A. WALL STREET AND ITS LOBBYISTS HAVE TOO MUCH INFLUENCE IN WASHINGTON

BASE: FAMILIAR WITH PROTESTS (787)

AGREE 86%

DISAGREE 11%

NO ANSWER/DON’T KNOW 4%

Q12. DO YOU AGREE OR DISAGREE WITH THAT POSITION?

B. THE GAP BETWEEN RICH AND POOR IN THE UNITED STATES HAS GROWN TOO LARGE

BASE: FAMILIAR WITH PROTESTS (787)

AGREE 79%

DISAGREE 17%

NO ANSWER/DON’T KNOW 3%

Q12. DO YOU AGREE OR DISAGREE WITH THAT POSITION?

C. EXECUTIVES OF FINANCIAL INSTITUTIONS RESPONSIBLE FOR THE FINANCIAL MELTDOWN IN 2008 SHOULD BE PROSECUTED

BASE: FAMILIAR WITH PROTESTS (787)

AGREE 71%

DISAGREE 23%

NO ANSWER/DON’T KNOW 6%

Q12. DO YOU AGREE OR DISAGREE WITH THAT POSITION?

D. THE RICH SHOULD PAY MORE TAXES

BASE: FAMILIAR WITH PROTESTS (787)

AGREE 68%

DISAGREE 28%

NO ANSWER/DON’T KNOW 4%

Q12A. IN YOUR VIEW, WILL THIS PROTEST MOVEMENT HAVE A POSITIVE IMPACT ON AMERICAN POLITICS TODAY, A NEGATIVE IMPACT, OR WILL IT HAVE LITTLE IMPACT ON AMERICAN POLITICS TODAY?

BASE: FAMILIAR WITH PROTESTS (787)

POSITIVE IMPACT 30%

NEGATIVE IMPACT 9%

LITTLE IMPACT 56%

NO ANSWER/DON’T KNOW 6%

——————————————————–

Why the Tea Party and Occupy Wall Street Should Cooperate (http://www.theatlantic.com)

“For all their disagreements, they share a belief that the relationship between finance and government needs reforming”

I discuss these questions further with my libertarian friend, Jeff:

Jeff wrote: “There are issues where the two sides could agree — ending corporate welfare, closing at least some overseas bases – to name just two. I think both groups span a broader spectrum than is being recognized. Some of those participating in OWS are actually advocates of less government interference in the economy — interference which invariably favors Big Business. And the TEA Party groups range from sincere advocates of a small, limited government to typical Romney-McCain Republicans.

PR: Well said, Jeff. Ending corporate welfare and excessive consolidation is as crucial to free enterprise as it is to democratic governance. IMO the global financial crisis is not just some random drive-by event, but is part of a criminal strategy of “robber baron” monopoly capitalism. Financial crises = budget cuts = mass privatization = neo-feudalism (global corporate governance). True free enterprise is the antidote.

I am frustrated by the difficulty my friends on the left have in seeing their entrepreneurial responsibilities and opportunities. I am also frustrated by the difficulty libertarians seem to have understanding the threat posed by concentrated wealth and power whether it be in the public or private sector. I think that progressives err in the false hope that big government will protect them from big business, and I think libertarians err in the false hope that small government will free them from tyranny.

It may well be that a cross-pollination between libertarians and progressives is the only way forward out of this mess. That is going to take depolarizing some class war and culture war biases on both sides. I have been as guilty of polarizing rhetoric as anyone, but I am rethinking my biases and trying to figure out how to mend my ways. You may be just the man to help me with that if you can overlook some of my inevitable old-guard-lefty rhetorical lapses.

I understand it is fairly common for libertarians to oppose corporate welfare, but how are libertarian positions spread on the consolidation of wealth and power in the private sector? IMO that is the more serious threat to liberty, fully equivalent to any threat from the state. As a progressive I might add that at least in the case of state power we still have some semblance of popular representation.

Jeff: “I believe a case could be made that most of the outrageous concentrations of wealth occur -because of, not in spite of, political interference in the economy. This is sometimes at the State and local levels, not just at the Federal level — for instance, a State might pass a statute setting such stringent requirements to sell health insurance within that State that only a few insurers can meet them; they then can divide up the market and charge much more than they could have in a free market. At the local level, even such weapons as zoning and sign control can lead to larger competitors getting larger still, and smaller competitors either shrinking or even going under. Note that -thoroughgoing- deregulation, not the faux kind such as the California electricity “deregulation” of several years ago, is almost always fought by the bigger entrants in a given field. Regarding government power, I would prefer to see legislative districts be smaller so that those not backed by Big Business have a chance of winning.

PR: I agree with all of the above except the possible implication that consolidation and concentration might magically disappear if not for the state. I’b be very skeptical of any such theory, but it’s probably moot. The state, like the poor, is always with us. In fact, I think most ideology is moot, since in the absence of a revolution we can never make over the status quo from top to bottom to meet the conditions required to test and either validate of falsify any ideology. Perhaps we can look around the world for real examples that might support or contradict a given theory. If I had to choose between Scandinavian counties where taxes and regulations were high, or African countries where taxes and regulations were low, I’d prefer the former.

Re: Libertarians to Occupiers: Crony capitalism is the problem | Libertarian Party,  (www.lp.org)

‎”It’s true that 99% of Americans do not enjoy the special benefits of crony capitalism. Crony capitalism is very different from real capitalism. In crony capitalism, government hands out special favors and protections to politically well-connected businesses.”

PR: I agree about the negative consequences of “crony capitalism”. But is crony capitalism only defined as an unwholesome alliance between government and business? What about unwholesome alliances between businesses? Granted, the state can behave badly. Business can behave badly. Is the libertarian position that business behaves badly only when corrupted by the state? In the absences of state interference business, in a “state of nature”, will regulate itself in a manner consistent with the public interest, the general welfare, and the pursuit of happiness by the weakest members of society?

The LP article says “”A free market is where the government leaves businesses alone, does not attempt to pick winners and losers, does not stifle competition, does not hand out corporate welfare, and does not absolve businesses of liability for their actions. Most of our economy today does not resemble a free market at all.”

Picking winners and losers, stifling competition, handing out corporate welfare, and absolving businesses of liability are things that government generally shouldn’t do, I agree. But is that really the same as “leaving business alone” entirely?

It is generally recognized that a free society is characterized by consent of the governed, and that consent usually includes consent to a system of laws–the rule of law being a lesser evil to the rule of men or the law of the jungle (the “war of all against all” (Hobbes)).

Most people agree that a free market is also a creature of law and not a creature of wild nature or of oligarchy. In nature, the wild marketplace is very free for the the strongest but hardly so for the weakest. A market that is as free and fair for the weak as for the strong is a market of laws. A market of laws is a market with referees.

In libertarian theory, who are the makers of the laws and who are the referees if not the republic?

Anyway, my own theory is that the real backbone of civilization and progress is not political theory or ideology but actually what is known as “common law”. From time to time new states are formed, as was ours, and old states are periodically reformed, to come into closer conformity with the evolutionary progress in the common law, which traces back to pre-history, even before the code of Hammurabi. The common law represents a gradual, case by case resolution of tensions between conflicting rights, values, and situations. That is the process that has produced those societies that are best to live in.

Jeff: “The libertarian view is that the only “regulation” should be that a business must not engage in force or fraud. Yes, businesses can sometimes for “unholy alliances”, but if they try to exploit that, then others can enter the market involved to compete with them. “Monopolies, trusts, etc. do not last long *if* they are not favored by government. Often, as in the case of the railroads or the phone companies, government will actually force smaller businesses to merge with the larger ones, to form a giant that would never have come about without political interference.

PR: I don’t buy that. What prevents a dominant player from continuing to buy up the competition? That requires neither force nor fraud, and has occurred many times. In fact, it would appear to be almost the rule. Government often gets bribed in to make the process go faster or cheaper for the predator, but is seldom really an essential or necessary accomplice.

Rockefeller and Standard Oil is the classic example where massive consolidation occurred rapidly in a largely unregulated market, but there have been plenty of other examples. Microsoft retarded the progress of computer technology by perhaps 20 years with no help from government. Government corruption often plays a role, but I see the role as secondary. In any case, I see the appropriate solution as eliminating corruption, not eliminating government.

People have a right to have an active, instrumental government and IMO that’s what most people actually desire. No self-sufficient minority will succeed in thwarting that desire very easily. That’s why I think libertarians waste a lot of energy and intelligence that should be invested pragmatically and creatively towards a libertarian sub-economy instead of trying to convert or reform the mainstream. The same goes for anarchists, agorists, mutualists, communists, socialists, etc.

I share your aversion to coercion and I think the mainstream should be forced to provide more “opt out” opportunities wherever practical, especially for taxes on services that someone never uses. One of the ironies I don’t understand is why some nominal libertarians complain about the poor not paying taxes. That whole strata of the economy is pretty libertarian, isn’t it?

Fortunately, despite the US leaning a bit toward central planning and regulation, there are numerous areas of the economy that are still fairly open and free, and I don’t think anyone is trying to exclude libertarians from those parts of the economy or from pursuing self-sufficient lifestyles. That is a route I’ve often taken.

An ideology- pluralistic 99% political coalition might also be used, albeit ironocally, to force the federal government to give each of our ideological subgroups undisturbed domains of the economy and culture within reason. We could almost do that now simply by each group aggregating in its own state, but perhaps we could enact a federally supported relocation program. This might really ease a lot of the tension and conflict between the more extreme or fundamentalist elements of the different ideological camps within the 99% and let the more moderate 78% get on with their lives in peace in the other 46 states.

How about:

  • Democratic Socialism Land: Hawaii
  • Libertarian Land: Texas
  • Commieland: Washington
  • Anarchy Land: Arizona
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4 Responses to “The value of inefficiency”

  1. n8chz Says:

    Anarchyland would be Oregon. Libertarian Land New Hampshire. Texas is The Holy Land. Michigan is Scorched Earth. Ohio is a state of mental health.

    • Poor Richard Says:

      Thanks for the corrections!

  2. Poor Richard Says:

    [Reposting from facebook on behalf of Uri Bekker]

    Uri: Good morning from SA Poor Richard. Just how refreshing i found your site and the discussion with Jeff, is really hard to say. It proves many things to me, first of all that the truth is on a comeback trail, and that it’s neutral and when we seek the truth it finds us and this truth is recognizable by all and sundry, because it’s not an intellectual persuit only, but it’s rich with feeling of goodwill, first and foremost!

    This keen discussion i hope to complement with my own homegrown ideas exhumed from the school of hard knox in which i’m a graduate.

    I did some serious study +- 30 years of Rudolf Steiner and will base my case on his ideas/concepts for a healty socio economic setup as gleaned from the ~human constitution~ ‘…the Kingdom of God is inside you…’ THB.

    In NO way will i impose on anyone these ideas on any religious grounds other than those acceptable to all religions and spiritual cultures. I.e. no dogma.

    Poor Richard: Thanks four your feedback, Uri Bekker. I’m very glad you felt the good will in my post–I’m working hard at that because I have been such an I-know-better-than-thou bastard in the past. I was never able to interpret Steiner’s philosophy very well but I can strongly vouch for his theories of biodynamic gardeniing. Much of my gardening success was based on it: https://almanac2010.wordpress.com/2010/06/13/super-nature/

    Uri Bekker: That seeking of neutrality was wat struck me the first time i read Steiner, and now the same with your very thought provoking site.
    It’s absolutly right to seperate power from one another and this is exactly what RS proposes with his Threefold Social Order. There is also his World Economy that MUST be studied by any serious political science students. I’ll speak in very general terms coz i’m not as informed of the setup in USA and would need your help here.

    The seperation of state from economy and the cultural sphere is the primary requierment for a ballanced socio economic setup. This RS equates to the tree main systems we find in the human constitution. They are;

    1. nerves, senses & brain cold system
    2. heart lung and capillary warmth system
    3. metabollic limb & willpower system

    In the same order he eqates the above to

    1. Economic arena ~ cooperation three groups
    2. State/legal arena ~ equality democracy solidarity
    3. Cultural arena. ~ competition sports schools; meds. agriculture church banking etc

    Poor Richard: Uri, I like this 3-fold order of RS. Is it possible that nerves/brain = state/legal arena and heart/lung = economic arena? That makes more sense to me.

    Uri Bekker: Yes biodynamics, a confirmation of: ‘Let Thy will be done, as above in heaven, so also on earth.’

    I worked on BD farms for a number of years so i can vouch for the validity of that claim.
    When one meets up with RS in a meaningfull way it’s like someone switched on a bright light in a dark room. So glad to hear you are already on this path.

    I also originally felt the need to place the economy with the metabollic/limb willpower system, but it turns out there are deep spiritual reasons for connecting the cultural arena with metabolism. This our gut is where spiritual forces from those deceaced family members work into our bodies. Think how one feels if you embark on a dangerous mission! That uneasy feeling are those beings. If power lacks here, we can do nothing. And food gives power, hence BD farming to stimulate real action.

    The science of economy is one that does not deal with substance/commodities, but price tendencies hence it’s equated to the senses+nerves+brain=thinking And it’s task is to study these tendencies in order to stabalize prices.

    The equting of the legal arena with the heart lung and capillary syst. is that it must operate as that syst. works i.e. with regular intervals depending on the need and absolutly throughout the entire body.

    These are the very basics of the TSO.

    Poor Richard: OK. That makes better sense to me. Thanks for the explanation.

    Uri Bekker: If the full implication of the TSO is grasped then one begins to understand the concept of democray in the true sense of the word. From the above we see that the economy is devided into three groups of people and here is where the principle of democracy becomes real. These groups are the;

    1. workers & producers
    2. transport and distribution
    3. consumers.

    Between these three groups of people legal contractual agreements prevail. Thus a basis is formed for preventing pricefixing colluding monopolies etc. For once the consumer gets a say in what goes. No longer the middleman or destributor. Nobody indiscriminatly jacks prices. This type of action will be met by a complete consumer boycott and or litigation?
    .
    The legal sphere will be responsible for meting out of justice only on an equal democratic basis, i.e. we the people reinstate Common Law. The legal arena cannot stop crime by making ever new legislation but by comming down very hard on criminals!

    I don’t mean to hog your page but we can and must go much deeper into these things to reach a kind of blueprint for a transition/devolution of power.

    [snip]

    The idea is to come to grips with the fact that we cannot get a grip on the economy in toto since that is humanly impossible, but what we cán do is to re-examine current economical jargon in the light of clear thinking alone, not by threadbare economic defenitions that don’t apply to a dynamic economy anyhow.

  3. Quotebag #56 | In defense of anagorism Says:

    […] “I agree about the negative consequences of ‘crony capitalism’. But is crony capitalism only defined as an unwholesome alliance between government and business? What about unwholesome alliances between businesses?”—Poor Richard […]


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