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

Backward Stumble in Laissez-Fairyland

Ron Paul and the TP are fond of saying you can’t spend your way out of debt. Or you can’t borrow your way to prosperity. There is a huge error hidden in a small truth there.

You can’t “spend” your way or “borrow” your way out of public debt crises, but you cannot cut or save your way out of them, either. You have to INVEST your way out of them. That’s how real capitalism is supposed to work. If you can’t borrow your way to prosperity, how did most of the now-thriving businesses in the world first get started?

Austrian/libertarian/laissez-faire/Tea-Party economics is wrong. Ron Paul is wrong.  But the Koch brothers hope you buy the deregulation, government is baad (ok?), every-man-for-himslef part of the story.

What progressives want to do is invest in new industries and enterprises that will create millions of good jobs and get revenue flowing into households first and then into the public treasury. The old, vested-interest money doesn’t want competition from green energy, local organic food, credit unions, housing coops, or any of that stuff, and that’s why they bankroll the libertarian/TP laissez-fairyland movements.

I think, I hope, that many in those movements just haven’t thought it all the way through. Some TP’ers only seem to think in terms of bumper-sticker slogans and sound-bite sized ideas. Others are extremely smart but may have arrested personality development (i.e. they are sub-clinical sociopaths).  A lot of young people seem to fall into that category. Self-absorbed and with chips on their shoulders to start with, they want nothing from the busy-bossy, self-absorbed establishment.  Some have conflicts between their financial interests and the better angels of their nature. Some are just decent, ordinary people who have been sold a huge load of crap. They are mad, but may not know who they should really be maddest at.

On the other hand, it doesn’t take a rocket scientist to see that we went from a budget surplus at the end of the Clinton administration to where we are now entirely under GOP leadership. . .

Note: If you hold some of the Laissez-Fairyland beliefs but don’t think you fit any of those categories above, please let me know. I am open to finding common ground.

Poor Richard

Related PRA 2010 posts:

Libertarian Fundamentalism

Green Free-enterprise

Economical Bestiary

At Other Blogs:

Critiques Of Libertarianism

A great web site with the following topics and much more:

A Non-Libertarian FAQ [More...]

A general introduction to discussion with libertarians, with an extensive discussion of arguments commonly used by libertarian evangelists. This is the original FAQ, little changed from when it originated in 1994.
What Is Libertarianism?
Twenty views of the big picture of libertarianism.
Notorious Failures of Libertarianism
Claims widely adopted by libertarians that are spectacularly wrong.

(many more topics)

October 9, 2011, 3:14 pm

IS-LMentary

A number of readers, both at this blog and other places, have been asking for an explanation of what IS-LM is all about. Fair enough – this blogosphere conversation has been an exchange among insiders, and probably a bit baffling to normal human beings (which is why I have been labeling my posts “wonkish”).

[Update: IS-LM stands for investment-savings, liquidity-money -- which will make a lot of sense if you keep reading here]

———————

The following web site has some examples of how the super-rich pay for phoney academic opinions and propaganda to support their fraudulent financial schemes. (Entire universities are becoming little more than hired PR firms.) ~PR

———————

Brad DeLong and Paul Krugman school Tyler Cowan

There is a huge demand for rebuttals to Keynesian arguments about how to fix the economy. Anti-government right-wingers and libertarians oppose Keynesian interventions, and they have vast wads of money to throw at such issues.

Tyler Cowan, at the George Mason University Economics Department, is employed by the Kochs for just that purpose. Apparently, one of his jobs is to undermine rival economists’ arguments.

Now, it is well known that no economics model is perfect, and it is easy to assemble a list of problems and a list of people describing those problems. But the fallacy is to use this list to denounce an imperfect model in favor of worse models or none. Voltaire wrote “the perfect is the enemy of the good”, meaning that we should not discard effective solutions for pie-in-the-sky perfectionism.

It is interesting to note Cowan’s typical strategy, which like most public relations strategies is not aimed at “proof” but at convincing onlookers with incessant repetition of ideas such as “problems with IS-LM”. Cowan throws a bombshell, and then echos supporters without answering any questions about his own position at any point. A ploy to attempt to retain academic credibility in the midst of vigorous dog-whistling. He wishes to use his academic authority without being responsible to the academic community.

It looks to me as if Cowen has won. He has achieved his goal of repeating his memes numerous times and showing that there are other academic supporters of his criticisms. Basically, this is a variant of the tarbaby strategy from Uncle Remus. Trick your opponent into a fight with a tarbaby. The opponent may get in all the good licks and totally destroy the tarbaby, but afterwards you are exhausted, helpless, coated with goo, but the rabbit that set up the tarbaby is untouched and laughing.

(this web page has many links for the technically inclined)

Private Property, Taxation, and Corporate Personhood

Dear cons, neocons, and libertarians:

Your notions of private property and taxation seem a little naive to me.

I am not a lawyer but I know something about the laws of real property (real estate law). I proposed and lobbied for the Tennessee Conservation Easement Act of 1981 and some TN legislators and lawyers considered me one of the state’s best experts on property law at the time. While my legal, historical, and philosophical knowledge of property ownership mainly concerns real property, many of the same principles apply to personal property, too.

I am a progressive, but several of my close friends have been Ayn Rand Libertarians, “lazy-unfair” capitalists (thanks to Natural Lefty for that turn of phrase), and free-market fundamentalists. If I  mis-state any of your beliefs please correct me.

The arguments I have seen  in support of absolute private property ownership fall into two categories: appeals to natural law and appeals to utility.

I. The appeal to “natural law” and “natural rights“. Libertarians and some conservatives view private property rights as the foundation from which all other natural rights extend. There are several problems with this:

 

From The Jungle Book by Rudyard Kipling. (Click image for full quotation)

 

A. Despite the musings of many erudite (if old-fashioned) philosophers, in the state of nature there is but one right: “might makes right” (Vae victis). Any other right can only be the result of imposing positive (artificial) law.

B. In the state of nature there is but one law: “might makes right” (Vae victis), again. Any other result can only be:

1) another case of imposing positive (artificial) law, or

2) the “law” of unintended consequences (this includes all biological and physical laws such as gravity, etc.)

C. In nature, possession is 100% of the law. The only private property is that which one can take and hold by force. If you can take it from someone else it becomes yours. If they can take it back or induce you to give it back it is theirs again. Natural social behavior might seem to introduce more laws, such as in the “law of the pack” and “pecking order”, but in nature these are simply either:

1) proxies for force which must be regularly backed up by force–there is no court of law, or

2) they are the product of genetically encoded, involuntary, instinctive responses to chemical or physical signals as in the case of social insects and bacteria.

D. Without the rule of law, predictably and impartially managed by society, property is nothing but a temporary possession maintained by private force. If the existence and persistence of private property depends upon a public legal infrastructure, then private property as we know it is a public creation. The public, which creates the “privateness” of the property and preserves it by force of law, always has a proprietary interest in any such property–by the principle of natural law! If this is too hard to wrap your head around, consider this–in any contest between private force and state force, the state wins. The only exception is a successful revolution or coup (Good luck with that!).

E. Many of the philosophers who have argued for “natural law” have conflated it with divine law, nature simply being a proxy for the divine creator. This attitude has passed by inheritance to modern-day conservatives and libertarians. Property, once the divine right of kings, is now the divine right and manifest destiny of whoever has the latest legal claim. In this tradition, the owner has an absolute (thus divine) right to his property which supersedes all other claims. The public interest, the interests of future generations, or the survival of the planet be damned. There are two problems with this argument:

1) This is thinly veiled religion which, in the possible absence or indifference of the necessary deity, amounts to little more than anarchy.

2) This “absolute” natural right can be magically dissolved by signing a piece of paper, just as any other so-called natural right of man can be signed away or even automatically abdicated simply by accepting casual employment. This reveals that the natural right, just like the natural man (the supposed “king of his castle”), is actually nothing more than chattel (from the word cattle–in law, any movable property; also used to refer to slaves, wives, and minor children).

 

Many of the categories above include additional rights or attributes not listed. (Click image for article on "Bundle of rights")

 

II. The appeal to utility

A. Proponents of the absolute right to private property claim that it promotes the common good in the same way that greed supposedly promotes the common good in the “free market”. They rely on an  “invisible hand” to make everything work out for the best even if each person acts purely out of greed, ambition, paranoia, malice, delusion, or any other form of vice, depravity, or pathology.

B. To be fair, they assert that an owner will always act in his own best interest and that the utility of absolute private ownership follows from this (with a little invisible helping hand still required). They assert that an owner will rarely fail to act in his own self-interest. However, only if every property owner acted in his fully enlightened self-interest could the appeal to general utility succeed. That test is clearly unmet. Most owners are not only unenlightened they are predictably irrational. The “rational agent” theory has been fully discredited in psychology, sociology, neuroscience, and even in economics (which tends to fall somewhat behind the curve in theories of human behavior).

C. Science has debunked the invisible hand  for failing to deal with irrational agents, externalities, and information asymmetry:

1. Nobel Prize economist Joseph E. Stiglitz wrote:

“Adam Smith, the father of modern economics, is often cited as arguing for the “invisible hand” and free markets: firms, in the pursuit of profits, are led, as if by an invisible hand, to do what is best for the world. But unlike his followers, Adam Smith was aware of some of the limitations of free markets, and research since then has further clarified why free markets, by themselves, often do not lead to what is best. As I put it in my new

book, Making Globalization Work, the reason that the invisible hand often seems invisible is that it is often not there.

Whenever there are “externalities”—where the actions of an individual have impacts on others for which they do not pay, or for which they are not compensated—markets will not work well. Some of the important instances have long understood environmental externalities. Markets, by themselves, produce too much pollution. Markets, by themselves, also produce too little basic research. (The government was responsible for financing most of the important scientific breakthroughs, including the internet and the first telegraph line, and many bio-tech advances.)

But recent research has shown that these externalities are pervasive, whenever there is imperfect information or imperfect risk markets—that is always.

Government plays an important role in banking and securities regulation, and a host of other areas: some regulation is required to make markets work. Government is needed, almost all would agree, at a minimum to enforce contracts and property rights.

The real debate today is about finding the right balance between the market and government (and the third “sector”—non-governmental non-profit organizations.) Both are needed. They can each complement each other. This balance differs from time to time and place to place.[11] (Wikipedia: Invisible Hand)

 

(click image for article on "Invisible Hand")

 

2. Noam Chomsky, while acknowledging the intelligence of Smith’s thesis, wrote:

Throughout history, Adam Smith observed, we find the workings of “the vile maxim of the masters of mankind”: “All for ourselves, and nothing for other People.” He had few illusions about the consequences. The invisible hand, he wrote, destroys the possibility of  a decent human existence “unless government takes pains to prevent” this outcome, as must be assured in “every improved and civilized society.” It destroys community, the environment, and human values generally—and even the masters themselves, which is why the business classes have regularly called for state intervention to protect them from market forces.[12] (Wikipedia: Invisible Hand)

3. The political economist E.K. Hunt:

[Hunt] criticized markets and the externalities emerging from market exchanges as being a route for self-advancement at the expense of social good. Hunt helped contribute to the literature on heterodox economics, helping to coin the term “invisible foot” in contrast to a presumably beneficient “invisible hand”. Hunt wrote:

“If we assume the maximizing economic man of bourgeois economics, and if we assume the government establishes property rights and markets for these rights whenever an external diseconomy is discovered [the preferred "solution" of the conservative and increasingly dominant trend within the field of public finance], then each man will soon discover that through contrivance he can impose external diseconomies on other men, knowing that the bargaining within the new market that will be established will surely make him better off. The more significant the social cost imposed upon his neighbor, the greater will be his reward in the bargaining process. It follows from the orthodox assumption of maximizing man that each man will create a maximum of social costs which he can impose on others. D’Arge and I have labeled this process “the invisible foot” of the laissez faire … market place. The “invisible foot” ensures us that in a free-market … economy each person pursuing only his own good will automatically, and most efficiently, do his part in maximizing the general public misery. “(Wikipedia: Invisible Hand)

 

 

D. Without an invisible hand, the only interested party left around to represent the common good, the public interest, future generations, and the planet, and “to promote the general welfare” (as per the Preamble to the US Constitution), is (no big surprise to progressives) the public. The public interest is a proprietary interest in a portion of the bundle of rights which make up ownership. The public owns this proprietary interest by virtue (as stated before) of natural law!

E. For the appeal to utility to succeed, owners must put their property to its “highest and best use”. This condition is clearly not satisfied. The proponents of absolute private property rights often argue that it is government interference, (zoning, environmental regulation, nuisance laws, etc.), which prevents private owners from achieving the highest and best use of their property, and that such interference is a “taking” of their property. There is law on both sides of this argument and owners are free to file their claims in the proper court of jurisdiction– the venue which they argue is the only proper source of remedy.

Corporate ownership of property

Corporations are chartered by state law. Originally, the justifications for corporate existence were 1) to carry out a specific, narrow set of activities which the state agreed would serve a public need, and 2) to limit the personal legal liability of the investors and operators which might otherwise inhibit achieving  that public good for which the corporation was chartered. Classic examples are the early railroad corporations and hospitals. These served fundamental public needs and the liability issues acted as serious impediments to private developers and operators.

Today, the typical corporate charter includes a catch-all “or for any other legal purpose” article. Now, if corporations were intended to operate “for any other legal purpose”, the entire idea of a charter listing the intended purposes is entirely superfluous. Obviously, a corporation was originally intended to operate only for a very limited set of explicit, pre-defined purposes and those purposes were expected to serve an explicit, pre-defined public need, not simply any private purpose that a corporation might improvise from day to day.

In addition to limiting liability (thus removing a disincentive to meeting a critical public need) the state grants certain other privileges (not rights) to the corporation which are essential to conducting its business:

1. The privilege of acting as a party to such legal contracts as may be necessary for the conduct of its explicit, pre-defined business activity.

2. The  privilege of owning such tangible and intangible property (such as cash, real property, and intellectual property) as may be necessary for the conduct of its explicit, pre-defined business activity.

Now, unless an explicit pre-defined public need is to be served, what is the incentive for the state to specially limit the normal legal liabilities of the corporate investors and operators, including the liabilities incurred by its power to enter into contracts, and to grant it the privilege to hold property in perpetuity without any of the taxes that natural people and families must pay to transfer property among themselves and their successive generations? There are none. Such a charter, uncoupled from any explicit, pre-defined, compelling  public need, would serve no legitimate purpose for the state, and could only be considered a form of fraud, graft, or corruption.


Any extra grant of rights to a corporation beyond those described above, or any post hoc, improvised expansion of its scope of operation, is a direct contradiction of the core raison d’etre of corporations and is blatantly contrary to the public interest.

The privilege of corporate property ownership is subject to an explicit lien held by the state in the form of the corporate charter and the explicit Constitutional duty of the US Government, whose boss is the We The People,  to serve the public interest and to promote the general welfare.

Nevertheless, over the years government was motivated to liberalize the purposes for which a corporation might be granted a charter because it could impose double taxation by taxing both the corporate income and the dividends paid to investors. This was little more than institutionalized bribery–the state granted perpetual property ownership and limitations of liability in exchange for double taxation.

It has not been a fair exchange. In the intervening years since chartered purposes were broadened to include such things as “making shit loads of money” and “any other legal purpose”, corporations have grown increasingly powerful and the contribution of corporate taxes to the public treasury have steadily eroded away.

The Corporate Tax Dodge

By Cassandra Q. Butts, April 10, 2004

The news that more than 60 percent of U.S. corporations failed to pay any federal taxes from 1996 through 2000 when corporate profits were soaring and that corporate tax receipts had fallen to just 7.4 percent of overall federal tax revenue in 2003 – the lowest since 1983 and the second-lowest rate since 1934 – is an outrage. But it should come as no surprise to anyone who has been paying attention to national tax policy over the past few years. The General Accounting Office (GAO) report also found that an astonishing 94 percent of corporations reported tax liability of less than 5 percent of their total income during the same time period…

With Tax Day (April 15) fast approaching and the Bush administration continuing to make the case that the Bush tax cuts have benefited American families, the GAO report could not be timelier in painting a far less rosy picture. Both the GAO study and the historical record support the conclusion that any benefit working families have received from the Bush tax cuts has been more than offset by the additional tax burden they must bear because corporations no longer pay their fair share of taxes.

As the GAO study documents and the historical record proves, corporate tax dodging is directly linked to the reduction of corporate tax revenues. Corporate tax receipts dropped from an average of 4.8 percent of GDP during the 1950s to 1.3 percent of GDP in FY2003. Treasury Department figures show that actual corporate income tax revenues fell 36 percent from FY2000 to FY2003. And while the statutory corporate income tax rate is 35 percent, the effective corporate tax rate – the actual share of corporate taxes paid on corporate profits – has averaged just 26 percent since 1993, according to the Congressional Research Service…

Estimates of the cost of corporate tax loopholes have been projected at upwards of $50 billion a year, according to Citizens for Tax Justice.

As corporate tax receipts decreased, payroll taxes, the most regressive of all taxes, increased dramatically. Specifically, payroll taxes increased from 1.6 percent of GDP in FY1950 to 6.8 percent of GDP in FY2002, surpassing both corporate income taxes and excise taxes in their contribution to total federal receipts. This rise in payroll taxes represented a 30 percent increase in the contribution of payroll taxes to overall federal revenues.

At the same time, individual income taxes also increased in the past half century as both a percentage of GDP and in their relative contribution to total federal tax receipts. Individual income taxes rose from 5.8 percent of GDP in FY1950 to 8.3 percent of GDP in FY2002.

During the Bush-Cheney years, the largest corporations (now transnational entities with no allegiance to the US) completed the process of taking the US Government (at its own invitation) captive, as both Thomas Jefferson and President Dwight Eisenhower had predicted they would.

The original reasons for corporate existence and corporate privileges have gradually dwindled away. The only justification that remains, according to conventional wisdom, is jobs. That justification is false. The corporate enterprise has no inherent advantage as a creator of jobs other than its advantage in destroying unincorporated employers and self-employment by leveraging its special advantages of perpetual life, limited liability, market monopolization, and corrupting political influence to force out competition. This is diametrically opposed to the long term public interest and maintaining a balance of power between popular sovereignty (democracy) and rule by the wealthy (plutocracy).

“The word plutocracy is derived from the ancient Greek root ploutos, meaning wealth and kratos, meaning to rule or to govern.”

“Before the equal voting rights movement managed to end it in the early 20th century, many countries used a system where rich persons had more votes than poor. A factory owner may for instance have had 2000 votes while a worker had one, or if they were very poor no right to vote at all. Even artificial persons such as companies had voting rights. In the US, it would take until 1945 before persons living on welfare and persons in personal bankruptcy would get voting rights.” (Wikipedia)

Michael Moore’s recent movie, “Capitalism – A Love Story” mentioned secret reports that Citigroup circulated to their wealthiest clients explaining a concept they called “plutonomy” –a blend of pluto- (wealth) and economy. A plutonomy is a system in which economic growth is both powered by and consumed by the rich. In other words, a plutonomy is a society of the rich, for the rich, and by the rich.

The Secret Citigroup Plutonomy Reports:

“We [Citigroup]… posit that:

➤ The world is dividing into two blocs – the plutonomies, where economic growth is powered by and largely consumed by the wealthy few, and the rest.

➤ We project that the plutonomies (the U.S., UK, and Canada) will likely see even more income inequality…”

Full report:  Citigroup-Oct-16-2005-Plutonomy-Report-Part-1

“Revisiting Plutonomy: The Rich Getting Richer

➤The latest Survey of Consumer Finances, for 2004, has been released by the Federal Reserve. It shows the rich continue to account for a disproportionately large share of income and wealth in the US economy: the richest 10% of Americans account for 43% of income, and 57% of net worth. The net worth to income ratio for the richest 10% of Americans increased from 7.4x in 2001, to 8.4x in the 2004 survey. The rich are in great shape, financially.

➤We think the rich are likely to get even wealthier in the coming years. Implication 2: we like companies that sell to or service the rich – luxury goods, private banks etc. Favored names include LVMH and Richemont.”
➤RISKS — WHAT COULD GO WRONG?
Our whole plutonomy thesis is based on the idea that the rich will keep getting richer. This thesis is not without its risks. For example, a policy error leading to asset deflation, would likely damage plutonomy. Furthermore, the rising wealth gap between the rich and poor will probably at some point lead to a political backlash. Whilst the rich are getting a greater share of the wealth, and the poor a lesser share, political enfrachisement remains as wasone person, one vote (in the plutonomies). At some point it is likely that labor will fight back against the rising profit share of the rich and there will be a political backlash against the rising wealth of the rich. This could be felt through higher taxation on the rich (or indirectly though higher corporate taxes/regulation) or through trying to protect indigenous laborers, in a push-back on globalization — either anti-immigration, or protectionism. We don’t see this happening yet, though there are signs of rising political tensions. However we are keeping a close eye on developments.

According to Jamess at the Daily Kos Blog on 10/04/09

“Those [Citigroup] reports, since leaked, plainly discuss the power of the Plutonomy in America, and how it would only strengthen, as long as the “the rest us” (the non-plutonics) could be kept in the dark about the Plutonomy existence, its role, and its over-arching control in the American Economy”

Even though the Plutonomy (the top 1%) control over 50% of the net worth in America — they don’t control the Votes!

The thing they most fear is the principle of “one person — one vote”.

You see despite their extreme wealth and power, they only have 1% of the vote; “the rest us” control the other 99% of the votes.

We, the People

Plutocracy and plutonomy are not the same as democracy and they are not compatible with democracy. They are antithetical to democracy and the liberty of  “We, the People“.

The Preamble to the US Constitution reads:

“We the People of the United States, in Order to form a more perfect Union, establish Justice, insure domestic Tranquility, provide for the common defence, promote the general Welfare, and secure the Blessings of Liberty to ourselves and our Posterity, do ordain and establish this Constitution for the United States of America.”

Plutocracy and plutonomy produce ever greater concentrations of wealth (private property) in fewer and fewer hands. If one wanted to design a system or process by which a democracy would gradually be subverted and transformed into an aristocracy or oligarchy, (society dominated by small elites) plutonomy would be perfect for the job.

Wikipedia: Oligarchy

The word oligarchy is from the Greek words “ὀλίγος” (olígos), “a few” and the verb “ἄρχω” (archo), “to rule, to govern, to command”…  Oligarchies have been tyrannical throughout history, being completely reliant on public servitude to exist. Although Aristotle pioneered the use of the term as a synonym for rule by the rich, for which the exact term is plutocracy, oligarchy is not always a rule by wealth, as oligarchs can simply be a privileged group, and do not have to be connected by bloodlines as in a monarchy.

Economic Inequality

Economists and political scientists tend to agree that a certain amount of economic inequality and disequilibrium is good for a society. It stimulates fluidity, creativity, competition, and motivation. Most economists and political leaders have also come to agree that too much inequality is bad. Monarchy, monopoly and plutonomy represent too much inequality.

Beyond some point, the greater the disparity of income and concentration of wealth (private property) in a society, the greater the degree of servitude of the masses. Mass servitude is not what the US was founded for. That was not the original meaning or original intent of the Constitution. No version of originalism dares claim such an intent.

At some point, the greater the inequality of income and concentration of wealth (private property) in a society becomes, the less healthy, happy, and free the people of that society are.

A study published in 2009[1] has shown that negative social phenomena such as shorter life expectancy, higher disease rates, homicide, infant mortality, obesity, teenage pregnancies, emotional depression and prison population correlate with higher socioeconomic inequality. (Wikipedia: Economic Inequality)

Thus, almost every aspiration expressed in the Preamble of the US Constitution is directly thwarted by the unlimited concentration of wealth.

The principle tool the public has to prevent the excessive concentration of wealth is taxation.

Taxation

 

Law and Taxation: balancing public and private interests

 

The natural, proprietary interest which the public retains in all private property is the basis of the people’s right to tax income, property, and inheritance. If tax rates are too high, the burden may stifle economic activity. If rates are too low, especially in the top tiers, concentrations of wealth may grow large enough to stifle activity in the lower economic tiers (plutonomy). Democracy can not endure if we abuse the power of taxation, nor can it  endure if we use this power too little.

At big holiday gatherings at my grandparents’ house, meals were eaten at two tables–the grown-ups’ table and the kids’ table. There is a social parallel:

At the kids table, political conversations are ideological–ideals are black and white and principles are expressed as simplistic clichés, such as “Government is not the solution, government is the problem”, and “Taxation is theft”. For every complex problem there is a simple solution.

At the grown-ups table, ideals are tempered by reality, complexity, and  pragmatism. Simplistic ideologies and sophomoric theories are subjected to historical and empirical criticism. Black and white values become shades of gray when seen in terms of complex trade-offs between various competing interests. At the grown-ups’ table, the social confiscation and redistribution of wealth through taxation is not an evil in and of itself. It is founded on natural law and it can be used to establish justice and balance. It is an evil only if carried too far.

The potential for evil lies equally in taxing too much or too little.

Well-regulated taxation is as fundamental to the preservation of democracy as the rule of law.

Corporate Personhood

The 14th Amendment of the US Constitution says:

Section 1. All persons born or naturalized in the United States, and subject to the jurisdiction thereof, are citizens of the United States and of the State wherein they reside. No State shall make or enforce any law which shall abridge the privileges or immunities of citizens of the United States; nor shall any State deprive any person of life, liberty, or property, without due process of law; nor deny to any person within its jurisdiction the equal protection of the laws.”

Corporations are neither born nor naturalized and thus are neither people nor citizens. They are also not citizens in that they are not issued passports and they do not have the right to vote.

If corporations were persons, then by virtue of the “equal protection” clause of the 14th Amendment, all rights and privileges afforded to corporations, such as immortality and limited liability, would have to be extended to all natural persons as well.

Corporations are not persons. They may act as artificial or virtual persons for the purpose of contracts and holding property, period. This is a limited, artificial, legal device created by statutory law–not one created either by natural law or the US Constitution.

There are a few narrow ways that corporations may act similar to persons. But there are many ways in which corporations, special interest groups, and rich persons are all very different from ordinary working persons.

As the Citigroup plutocracy reports correctly point out, the money is on one side and the votes are on the other side. To remain free and democratic, we must steer the bus of state between the ditches of public tyranny and private tyranny.

Anyone is free to argue, with their speech or their vote, that any particular exercise of taxation, zoning, environmental regulation, or other public-interest restrictions on the absolute ownership of private property are bad public policy. However, the argument that all such exercise of law is categorically evil is patently absurd and has no place at the grown-ups’ table. And when wealthy corporations, big associations, or rich people bribe or buy politicians or spend millions on propaganda designed to trick average working Americans into acting against their own enlightened self-interest, that kind of behavior is un-American.

That is not speech. That is not democracy. That is information warfare, and those who commit such acts are enemy combatants.

Poor Richard

Related:


Libertarian Fundamentalism

“When plunder becomes a way of life for a group of men, they create for themselves, in the course of time, a legal system that authorizes it, and a moral code that glorifies it.” – Political economist Frederic Bastiat, The Law [1850]

Such a code is laissez-faire or “free-market” capitalism and libertarian fundamentalists are its zealots. Anti-competitive, predatory, monopoly capitalists and robber-barons in the USA promote this ideology because the word libertarian resembles the word liberty and US Americans have a cult of individualistic freedom.  The crux of libertarian fundamentalism (or extreme libertarianism) is how differently it treats the issues of coercion and tyranny in the private and public sectors.  The ideology asserts (on theoretical rather than empirical grounds) a natural bias towards freedom and justice (and against coercion and tyranny) in the former and the opposite in the latter; and it generally turns a blind eye towards the concentrations (and abuses) of power in the private sector that can be observed in weak states just as often as in strong ones.  Libertarian fundamentalism asserts, again without empirical evidence, that courts of law are more dependable regulatory mechanisms of social and economic justice than democratic legislatures. Many of the most powerful promoters of libertarian fundamentalism are themselves unscrupulous crony capitalists who gain advantage by corrupting and manipulating our legal and political institutions.

Look, I’m all for liberty, freedom, individuality, etc. but on some level these are optimized under a regular order of some kind. Rules. We have these even in war and football. The solution to cronyism is not smaller government, fewer rules, fewer referees. The best alternative to corrupt government is not no government, its uncorrupted government. Solutions are those that reduce corruption and increase accountability.

“Though the principles of the banking trade may appear somewhat abstruse, the practice is capable of being reduced to strict rules. To depart upon any occasion from those rules, in consequence of some flattering speculation of extraordinary gain, is almost always extremely dangerous and frequently fatal to the banking company which attempts it.” — Adam Smith

Taxes

adam smith on taxes“The subjects of every state ought to contribute toward the support of the government, as nearly as possible, in proportion to their respective abilities; that is, in proportion to the revenue which they respectively enjoy under the protection of the state ….[As Henry Home (Lord Kames) has written, a goal of taxation should be to] ‘remedy inequality of riches as much as possible, by relieving the poor and burdening the rich.’” — Adam Smith

 

Individual responsibility

When I was a schoolboy,  back in the day when “civics” and “social studies” were taught, we heard over and over that freedom or liberty always came with responsibility. But that is too nebulous. As the final words of the US Declaration of Independence solemnly affirm, we must “mutually pledge to each other our Lives, our Fortunes and our sacred Honor.”  Individualism must be tempered with an equal measure of cooperation and service to the community of life on earth. We owe a debt to all that has come before and all that will follow. Individualism without an equal measure of formal, committed cooperation and service literally has no place in the modern world. This is the pathology and poverty of the libertarian fundamentalists’ one-sided individualistic position.

Libertarian fundamentalism’s “rugged individualism” is almost impossible to espouse without hypocrisy– at least not without becoming grotesquely Machiavellian and sadistic, as when Tea Party fans cheered Ron Paul for suggesting that uninsured sick people should seek help from the church or shut up and die:

———————-

Susan Grigsby’s brother Steve died a painful death fighting for care as an uninsured American. Susan watched, horrified, as the GOP Presidential Candidates on CNN’s Tea Party Debate stood silent when the the audience cheered for the idea that we as a society should just let an uninsured man die. Now Susan wants an answer from each and every GOP candidate.

——————–

Mike Huben writes at the Critiques Of Libertarianism blog:

“That’s what freedom is all about: taking your own risks”

That’s how Ron Paul described his campaign manager’s early, uninsured death.

However, “When he died on June 26, 2008, two weeks after Paul withdrew his first bid for the presidency, his hospital costs amounted to $400,000. The bill was handed to Snyder’s surviving mother…who was incapable of paying. “

This is a classic case of libertarians claiming that they are taking their own risks, but somebody else ends up having to pay.  There is a simple reason why libertarians routinely lie this way: their ideology claims they are independent, but the reality of human socialization is that we are interdependent in many ways.  Through families, churches, friendships, professional associations, employment, etc.  We routinely and informally assume responsibility for each other.

Another example from among the hundreds that might be found is this:

“In an interview on Hardball With Chris Matthews on MSNBC, Republican Senator Mike Lee of Utah admitted that he wants to bring America to its knees if an amendment is not passed in Congress that would force Americans to live under conservative governance despite which party the people elects. Here is the transcript.

Its too bad for these libertarian fundamentalists that Niccolo Machiavelli, the Marquis de Sade, and Ayn Rand were not among the founders and philosophical progenitors of the United States.

Another error of libertarian fundamentalism, American style, is to abhor the capacity for tyranny in the state and ignore the capacity for tyranny in its alternatives.

Our libertarian fellow travelers are especially fond of asserting, as a characteristic of that entire American school of thought, that governments are awful. In this they are largely correct, since governments exist to serve the needs of those who can afford to constitute them, run them, maintain them and benefit by their operation. Unfortunately, this libertarian willingness to generalize about the organization of governments as thinly disguised protection rackets does not extend to the necessary and inevitable concentration of power, wealth and bad faith in those successor organizations which would follow the collapse of the state-as-Leviathan. Intent as they are upon dismantling and escaping one obvious despotism, libertarians at the same time rather studiously ignore the more direct consequences of the weakening of the welfare functions of the states we have now; chief among those ramifications is the accelerated transfer of wealth, armed staffers, expertise and training functions to corporations, transnational exchange regimes and market affiliations, a one way flow which would result in the eventual reconstitution of states and state-like hierarchies from within corporate associations. (Crow, No Escape)

Naturally there are values and ideas  in classical libertarian thought that I share, but its seductiveness can’t be explained by these alone  (or I guess I might be a libertarian). This post mostly talks about libertarian fundamentalism the way it is found in the US today. It might better be called neo-libertarianism, juvenile libertarianism, or euphemistic libertarianism . As Noam Chomsky explains in the following brief video, a US libertarian fundamentalist is the opposite of a libertarian in the rest of the world, where much of  what we call libertarian fundamentalism might be called neo-liberalism.

Like fundamentalists of all ideologies, libertarian fundamentalists are the unwitting dupes of “the powers that be” (TPTB). Despite their claims to idealism, they are at best the inadvertent enablers of oligarchy.

THE POWERS THAT BE (click image to enlarge)

The main problem that I have with libertarian fundamentalists is that underneath the faith-based, laissez-fairyland dogma they are often (naively or accidentally) anti-democratic, anti-social, anti-scientific and even un-American. Their proposition that all taxation amounts to theft by a corrupt, rogue state does not square with the views of  prominent American Revolution patriots.

Libertarian fundamentalists are also unintentional anarchists.

In their single-minded preoccupation with the very real dangers of state tyranny, they would leave the door open and unguarded against private cartels, robber-barons, and warlords. The power of concentrated mass media (in the “invisible hands” of private puppet masters) to persuade the public against its own self-interest would be unopposed by any representative of the collective public interest.

Ship of Libertarian thought slips over the edge

Scholars have observed “Libertarianism began with some pretty radical thinkers.” Yes, and I have some resonance with  early libertarian thought, but since in all the intervening years they haven’t managed to substantiate any of their theorizing with empirical evidence or real-world examples, their ship has listed sideways off the edge of the real world. Where is an example of a successful fundamentalist libertarian society? The Sudan? Somalia?

Libertarians will protest that their Austrian & Chicago schools of economics have produced a great deal of scientific economic theory in support of free markets, the invisible hand, the rational agent, etc. The problem is that much of this is propaganda, in support of the ruling corporate regime, wrapped up in academic-sounding jargon. It is science fiction, fantasy, and half-truth. Some of this economic mythology is debunked in the Economical Bestiary. Other rebuttals can be found among the links below.

Some libertarian fundamentalists also display the character traits of both Narcissists and sycophants, seeking to garner unearned authority, importance, or financial gain by associating themselves with business leaders, corporate think tanks, or eccentric cult figures such as Ayn Rand who pose as maverick philosophers. Rand devotees accumulate points towards sado-masochistic favors from the mistress in the afterlife by endlessly carping at everyone else in the public square (which they want to privatize). They should never be seated with the adults.

(click image to enlarge)

Poor Richard

Related:

Covering  the following topics and much more:

A Non-Libertarian FAQ [More...]
A general introduction to discussion with libertarians, with an extensive discussion of arguments commonly used by libertarian evangelists. This is the original FAQ, little changed from when it originated in 1994.
What Is Libertarianism?
Twenty views of the big picture of libertarianism.
Notorious Failures of Libertarianism
Claims widely adopted by libertarians that are spectacularly wrong.
What Is Wrong With Libertarianism
Libertarianism is based on bad arguments. Here’s a list of some common problems with libertarian arguments.

Dispatches from Libertopia: An Anthology of Wingnut Chestnuts and Democratizing Remedies (Amor Mundi)

——————

Gallery

(click or hover over images for sources)

Follow

Get every new post delivered to your Inbox.

Join 642 other followers

%d bloggers like this: