Blood and Soil, MacLean, and Buchanan

Last week, at the Mises Institution, President Jeff Deist gave a speech on broadening libertarian appeal.  He concluded the talk thus [emphasis added]:

In other words, blood and soil and God and nation still matter to people. Libertarians ignore this at the risk of irrelevance.

Many libertarians objected to the phrase “blood and soil,” because of its historical context and ties to Nazi Germany and fascism (for example, see this piece by Steve Horwitz).  Others claim that the phrase is taken out of context and that it was referring to a Jeffery Tucker piece written earlier that month (personally, I find this explanation a bit problematic, but I won’t go into that here).

Also this summer, libertarians have taken aim at the book Democracy in Chains by Nancy MacLean, a highly erroneous account of the intellectual life of James Buchanan, founder of the Public Choice school of thought.  MacLean’s thesis is straightforward: despite the value-free wording of  Public Choice, James Buchanan and the Koch Brothers are working on a vast conspiracy to overthrow democracy and establish an oligarchy.  Despite lots of footnotes, she provides no hard evidence for her claims (as noted by various reviewers and fact-checkers, the sources cited in the footnotes tend to either be incorrect, incomplete, or downright contradictory).  And yet, she pushes on, undeterred and several on the left jump on board.

At first, I wondered how she could get away with this.  But then, I realized libertarians, and in particular, the methods espoused by Jeff Deist, aren’t doing ourselves any favors.

A quick history lesson is necessary (for a more complete, and probably more accurate than my retelling here, account, see here): back in the 80’s and 90’s, there was a movement within libertarians, lead in particular by Murray Rothbard, Lew Rockwell, and Ron Paul, to recruit as many people to libertarianism as possible, particularly as a conservative-libertarian fusion and oppose the left, which was becoming more socialistic, on cultural grounds.  Of course, this strategy appealed to many people who were of decidedly anti-democratic nature (white supremacists, Neo-Nazis, anti-foreigner, etc).  Whether or not recruiting these specific people was the goal of the policy is irrelevant; it was the consequence.  Many of these groups, which were now broadly calling themselves “libertarians,” were decidedly anti-democratic and decidedly racist and decidedly elitist and all the charges levied by MacLean against Buchanan.

One cannot fault MacLean for not knowing this history (although perhaps were she doing a better job on her book, she would have researched the matter).  I, who have been in the libertarian movement for about a decade, am just learning much of this.  But it does make her accusations, at least prima facie, more understandable.  Buchanan’s work is used in a lot of libertarian economics (although to call him a major influence is a bit much), he got money from the Kochs (who are libertarians), Stormfront and alt-right leader Richard Spenser have called themselves “libertarians,” therefore Buchanan and the Kochs must share similar goals as Spenser and Stormfront and others.

Jeff Deist may think he’s doing libertarians a favor by trying to make libertarianism have a broad appeal.  But, if you cast a wide net, you also risk dragging up rotten fish which can ruin the whole bunch.  This is the wrong strategy for winning people over.  Rather than admit libertarianism is weak, unable to face challenges of the day, and thus must turn to other areas and places (or, abandon our principles in the face of things like “immigration” and “feminism”), we must show that libertarianism and classical liberalism is still relevant.  If we continue to cast a wide net and drag up rotten fish (unintentionally or not), then we will continue to stink.

Taxation Is Not Necessarily Theft: A Rejoinder to Libertarians and Anarchists

Taxation, by its nature, is not necessarily theft.  Likewise, taking something and not giving something in return is not necessarily theft, either.  The circumstances are what matter.

By way of example: two men meet on the street.  One is selling apples.  The other man has money.  They agree to an exchange: one man gets $5, the other gets a bushel of apples.  The two go on their merry way, happy as can be.  No theft here.

A similar circumstance: two men meet on the street.  One is selling apples.  The other man has money.  While the apple seller is distracted, the other man takes an apple and leaves no money.  Now, a theft has occurred.

What is the difference between the two stories above?  In the first, there is consent between the two parties.  In the second, there is no consent.  Consent is what makes an action theft or voluntary.  There would be no argument whatsoever on this point.  So, the question becomes, can one never consent to taxation?  Is taxation inherently non-consensual?

The answer to that question is “no.”  Taxation is not inherently non-consensual.  It can be agreed upon; it can be consented to.  Let’s say a group of people get together and decide to pool their resources for some public good (let’s say, common defense).  Depending on the structure of their arrangement, they all agree to provide some annual contribution to this goal.  This is, in essence, taxation.  Furthermore, it is consensual taxation.

But if taxation can be consensual, doesn’t the use of (or threat of) force for compliance necessarily mean that taxation isn’t consensual?  Isn’t that evidence against my thesis?  Again, not necessarily.  Yes, the thief may use force to get what he wants, but even consensual agreements may carry a threat of force.  Contracts contain provisions in case one person reneges on his deal.  These are voluntary agreements that contain elements of force if certain conditions are not upheld.  So, the existence of force is not in and of itself a sign that the agreement is involuntary.

The real question, the one we should be discussing and thinking on, is “what constitutes consent?”  If governments “derive their just powers from the consent of the governed,” what constitutes consent?  At what point does government “become destructive to these ends”?*  Yes, this is the interesting question and one I will not be discussing in this post.

*A quick aside on this point: using the same logic as above, it can be shown that merely being in a minority, losing an election, or not having things go your way in politics is not necessarily a sign of oppression or malfunctioning government.

Everyday Economics: Bioshock Edition

On my recent trek between Virginia and Massachusetts (and back), I listened to an audio version of the book Bioshock: Rapture by John Shirley (If you’re looking for something light to take your mind off of things, this is a good book).  The book details the rise and fall of Rapture, a massive underwater city built by Andrew Ryan (a not so subtle jab at Ayn Rand) to escape the “parasitic” governments of the world and build a society dedicated to freedom and free markets.  While the initial goal of Rapture may have been freedom and free markets, as the novel (and the video game that the novel is based on) details, Rapture becomes a totalitarian police state with an extremely wealthy (and often sadistic) upper class, and extremely poor low class, and no one in between.  Some see Bioshock as a refutation of Randian philosophy, however, I will not address that here as I am no expert in Ayn Rand (for an excellent discussion, see The Value of Art in Bioshock: Ayn Rand, Emotion, and Choice by Jason Rose).  I’ll leave that to people far smarter than I.  Rather, I want to address the economic situation of Rapture and discuss, briefly, how that contributed to the downfall.

A few quick disclaimers before I begin:

  1. As far as I know, Bioshock: Rapture is not canonical.  However, it is the only detailed source I can find thus far on the days of Rapture that take place before the video game (which is canon) so I will operate on the assumption that my source material is canonical knowing full well everything I write here could become completely worthless insofar as discussing canonical information (the lessons gleaned from this book are still important, however).
  2. Nothing in this essay should be taken as implying the rise or fall of Rapture is purely economic.  There are many other factors involved (social, political, medical, psychological, etc).  I skip or gloss over these not because I think they are unimportant (quite the opposite, really), but because I simply lack the expertise to discuss them with any confidence.
  3. I will be avoiding using direct quotes in this version of this essay.  The reason for this is simple: I have the audio book, not the book itself.  I can’t easily do verbatim quotes and attribute them to proper pages for citations.  Therefore, the reader should be aware that I am doing this partly out of memory (although I did scribble some notes) and further the reader should assume that whenever I describe what’s happening in Rapture, that is a reference to the work of Mr. Shirley.  The only original material will be my analysis.  Any inaccuracies, either to details or analysis, belong to me and me alone.

The short version of what follows: Rapture cannot be classified in any meaningful sense as a “free market.” It suffers from several deficiencies that prevent us from labeling Rapture as a free market: lack of property rights, lack of free trade (autarky), lack of labor mobility (autarky in the labor market), rejection of altruism, widespread and institutionalized fraud (this issue is speculative based off of interviews with characters within the book but not substantiated by details), and censorship (indirect at first, but more direct later).  In Andrew Ryan’s Rapture, “free market” and “laissez-faire” were not much more than dishonored buzzwords.  It can best be described, in the words of James Buchanan, as “moral anarchy,” (see Moral Science and Moral Order, especially page 190 and Limits of Liberty, especially Chapter 7).  These factors, coupled with other psychological, social, and other factors, lead to the decline, civil war, and eventual fall of Rapture.  Continue reading

Institutional Magic

Don Boudreaux and Bryan Caplan have an interesting exchange regarding Caplan’s question on why no libertarian/Progressive alliance has formed on key issues of agreement.  Caplan’s original post is here.  Don’s comment is here.  Caplan’s reply to Don is here.

Both Don and Bryan are people who, when I disagree with them, I think long and hard about why.  Bryan never hesitates to put his money where his mouth is and Don’s reputation of being a careful thinker is well-earned.

That said, I wonder if there isn’t an explanation that is compatible with both their arguments as I understand them.  That explanation comes from magic.

Gordon Tullock explains:

Most traditional institutions are surrounded with what anthropologists call “magic.”  They are thought of in unrealistic terms, the lack of realism having the effect of making us more satisfied with our environment by convincing us that it is better than it really is.  the courts are no exception.  The view that an outcome of the judicial process is “true” is widely held.

The above quote comes from The Logic of the Law as reprinted in Volume 9 of the Liberty Fund’s Collected Works of Gordon Tullock, page 39.

I wonder if it is possible both Don is right that Progressives don’t necessarily see/believe in spontaneous order and that Bryan is right that Progressives see the value, but don’t like the corruption and whatnot that spawns.

Using Tullock’s language from the above quote, I wonder if Progressives are more susceptible to the “magic” of government, seeing it as better than it truly is and are less susceptible to the “magic” of markets, seeing it as worse than it truly is.  And the same is true of libertarians: they see markets as “magic” but government as less so*.  As such, Progressives may be more likely to oversell the benefits of government and the flaws of markets and undersell the value of spontaneous order, even if they know it is there.  Conversely, libertarians may oversell the benefits of markets and flaws of government and undersell the value of government, even if they know it’s there.

I wonder if, at the extremes, Don is right (extreme Progressives, being completely absorbed with the “magic” and seeing spontaneous order as the antithesis of government, completely reject the notion of spontaneous order (and vice versa for libertarians)), but the more moderate/intellectual in both camps see the benefits of each but are still under a “magical spell”.

Perhaps the issue here isn’t that Progressives are simply anti-market or that they simply do not see the benefits of spontaneous order.  Perhaps the issue is the two groups simply have different kinds of magical attunement.

*For the record, I don’t think either Don or Bryan are under such magical spells.

Social Welfare and Unanimity

Like James Buchanan, Jean-Jacques Rousseau, and many others before me, I invoke the “unanimity” condition whenever talking about social welfare (aka “the Greater Good”).  The reason for this is simple: only through unanimous agreement can something truly be said to be for the greater good; that it improves social welfare.

Welfare economists (and others) will call me crazy for such a claim.  “Of course that’s not true!” they say.  “Simply look at the benefits the beneficiaries get, the costs the payers pay, and if the benefit is higher than the cost, then it increases social welfare.”  This kind of cost-benefit analysis is important, I’ll grant that, but for the individual, not society as a whole.  Extrapolating to the societal, or collective, level gets messy.  The reason why is simple: valuation of costs and benefits are subjective.  For any given individual, the valuation of the benefit of Good X is likely to be different from the valuation of the cost of Good X.  Aggregating those valuations gets very very tricky and it ultimately leads to judgement calls by the analyst/policy maker.

If we want to make the claim that a collective action benefits the greater good, and we want to be able to say this positively and not normatively (that is, to eliminate judgement calls), then we need to apply the same standards as at the individual level, the most important of which being unanimity.  In an individual action, all parties agree to interact; if there is no unanimous agreement, the interaction does not take place.  If one disagrees, then we can conclude he does not stand to benefit from the interaction.  Extrapolating this to collective action (that is, more than two people interacting), then the only way to positively claim the action benefits the group as a whole is if it is chosen unanimously.

At this point, I provide only assertions and light reasoning.  An upcoming blog post will go much more in depth and I will attempt to prove my assertion, using the reasoning of James Buchanan and Gordon Tullock.  However, this post is long enough as it is and I will bore the reader no further.

Emergent Order vs Imposed Order

In my recent post on the law, I had talked a little bit about law as an emergent order.  Commentor Greg G responded:

You have fallen into the trap of simply using the word “emergent” as a compliment for those emergent processes you approve of. Millions of voters select hundreds of thousands of representatives at different levels of government. Different levels of government sometimes make laws that conflict with each other. The elected representatives select many thousand of bureaucrats who participate in determining what the law is. Every single one of these agents has their own decentralized complex set of motives and goals which include calculating to what extent they need to satisfy the desires of the voters.

Greg’s comment deserves a response.

Is the formation of a government an emergent order?  Yes.  If we go with the classically liberal view of government, government was formed in order to protect individual rights in cases where collective action is the least costly action (other theories of government will work in this same manner; we’ll just change the justification.  The only theory that might now work is government by divine right, as that would indicate not an emergent order by human interaction but rather divine intervention).  Government emerged to satisfy certain needs in the same way a firm emerges to satisfy certain needs.

Emergent order arrives peacefully; consensually.

Imposed order, on the other hand, is non-consensual.  It is imposed by force.  Libertarians and classical liberals tend to identify government as the perpetrator of imposed order.  While government is a perpetrator (and perhaps the largest), the problem is not isolated to government alone.  For example, a man who mugs another is imposing order: he is imposing the forcible transfer of goods/currency from one person to another.

When it comes to government, we must be very careful about how we apply classifications.  It’s a complex question, and I’m not sure I understand it fully.  For example, let’s say that, on a constitutional level (that is, when designing the government), the group unanimously agrees that any legislation passed only needs 51% approval.  So, we have an emergent order on how things work.  Using that simple majority, the government makes rules.  Are these rules emergent order or imposed order?  I suspect there is a justice element to the answer.  I also expect there’s a discussion on whether or not the decision-maker is exceeding his mandate.

As with my piece the other day, these are rough ideas which I will need to fill out going forward.  Comments appreciated and encouraged.