The Free Market: Now You See It, Now You Don't!
Whenever you point out something particularly bad being done by a corporation or an industry to a libertarian and ask if the free market might have had a part in it, you are told "The free market does not exist: we are living in a world where markets are plagued by a myriad of interventions!"
But this free-market that does not exist whenever one is pointing to a problem, suddenly pops into existence whenever a libertarian wants to take credit for some improvements that have gone on in the world:
"and peaceful solutions (the free market) have emancipated more people from grinding poverty than any other force in the history of the world."
Sorry, the exact same mixed economy that has produced crony capitalism and pollution has produced the economic growth that has lifted people out of poverty, since that is the only sort of economy we have had during the time Woods is discussing. You don't get to call it your beloved free market whenever it produces something good, and disavow it every time it produces something bad, like a mother who, when her kid gets an 'A' boasts about "my son," but when he comes home drunk, berates her husband for what "your son" did.
As an extra, Woods's piece also contained this notable piece of crazed paranoia:
"The conference [on Catholicism and libertarianism at Catholic University] was straight out of Stalin’s Russia. We must smash the deviationists!"
"Straight out of Stalin's Russia": Yes, Tom, that's why there were all those show trials down at Catholic U, followed by executions and exiles to the Gulag and decades of slave labor.
What really happened were no libertarians were invited to the conference. Imagine, some like-minded people organize a conference to discuss their ideas and they don't invite those with whom they strongly disagree! Just like Stalin!
You know what other conference organizer turns out to be just like Stalin, using Woods's "standard"? Well, I've been to a few conferences at the Mises Institute, of which Tom has attended many. And you know what: no leftists are invited! Conferences at the Mises Institute: Straight out of Stalin's Russia.
But this free-market that does not exist whenever one is pointing to a problem, suddenly pops into existence whenever a libertarian wants to take credit for some improvements that have gone on in the world:
"and peaceful solutions (the free market) have emancipated more people from grinding poverty than any other force in the history of the world."
Sorry, the exact same mixed economy that has produced crony capitalism and pollution has produced the economic growth that has lifted people out of poverty, since that is the only sort of economy we have had during the time Woods is discussing. You don't get to call it your beloved free market whenever it produces something good, and disavow it every time it produces something bad, like a mother who, when her kid gets an 'A' boasts about "my son," but when he comes home drunk, berates her husband for what "your son" did.
As an extra, Woods's piece also contained this notable piece of crazed paranoia:
"The conference [on Catholicism and libertarianism at Catholic University] was straight out of Stalin’s Russia. We must smash the deviationists!"
"Straight out of Stalin's Russia": Yes, Tom, that's why there were all those show trials down at Catholic U, followed by executions and exiles to the Gulag and decades of slave labor.
What really happened were no libertarians were invited to the conference. Imagine, some like-minded people organize a conference to discuss their ideas and they don't invite those with whom they strongly disagree! Just like Stalin!
You know what other conference organizer turns out to be just like Stalin, using Woods's "standard"? Well, I've been to a few conferences at the Mises Institute, of which Tom has attended many. And you know what: no leftists are invited! Conferences at the Mises Institute: Straight out of Stalin's Russia.
Have libertarians ever debated air-quality legislation? London used to suffer from deadly smogs and things didn't start to improve until the Clean Air Act of 1956.
ReplyDeletehttp://en.wikipedia.org/wiki/Clean_Air_Act_1956
@Gorilla Bananas: Yes, speaking from personal experience, that point has often come up in debate, and it doesn't pose the difficulty that you seem to think it does. The improvement brought about by the Clean Air Act did not take place against a background of libertarian property rights. The attempt to use this as evidence against the libertarian position is essentially tantamount to saying A>B, therefore A>C.
ReplyDeleteA perfect example of what I am talking about Daniel! Anything good that is happened in economic history happened because of the free market. Anything bad that has happened has happened because we don't have a free-market.
DeleteWoods is really out of sync with the Catholic Church. Where would you place the Church politically? Obviously the left-right spectrum is inapplicable to it, but I'm talking about what label/term would best fit/describe it.
ReplyDeleteDistributist?
DeleteI'm familiar with the term and somewhat with the concept. It's seems like it's at heart about small communities instead of mass society (which isn't necessarily a bad thing). A return to the time before the onset of the Industrial Revolution.
DeleteThe main idea is that property is widely distributed. It fits very well with things like 3D printers and local power generation.
DeleteIt also places property within a social context, right? Like saying that property should be responsive to social bonds or the like.
DeleteWhere would you place the Church politically? Obviously the left-right spectrum is inapplicable to it, but I'm talking about what label/term would best fit/describe it.
DeleteCatholic Social Teaching helped to inspire Distributism. But it also helped to inspire Christian Democracy and (to a lesser extent) Corporatism. I would say that it's hard to place the Church politically because it doesn't have a comprehensive political program so much as it has principles that can be adapted to a wide variety of systems.
I think that Gene is right; the Church, from my meager readings into it, is Distributivist. And I certainly don't think that it is possible to categorize Catholic social teaching in either a 'left' or 'right' political category! I think that this is part of the reason folks are so befuddled by it here in the States; each party has the idea that they have an exclusive access to the Truth, the Whole Truth, and Nothing But the Truth; i.e., Rationalism in Politics.
ReplyDeleteThose medical researchers !
ReplyDeleteEvery time average lifespans increase they claim it down to medical progress.
But every time there is an outbreak of illness they say it all the fault of germs or visrusses !
Bad analogy, rob: those are two different things. The right analogy:
DeleteEvery time average lifespans increase they claim it down to medical progress.
But every time there is an outbreak of illness they say it is because there is no such thing as medical progress.
And medical doctors actually have evidence. There is NO evidence that anarchy or minarchy would beat out mixed economies in wealth production: stateless societies are always very poor, and all wealthy societies in history have had a more than minarchist government.
DeleteSo here is an even better analogy: "Proteinarians" have noticed that people who eat very little protein are sickly. So they keep recommending everyone eat an all-protein diet. Every time health improves, they attribute it to the all-protein diet (even though no one is eating it). Every time there is an epidemic, they attribute it to the absence of the all-protein diet.
Free market advocates might believe
Delete1. Even though markets are not free (so technically we don't have a "free market") , we still live in a world where market mechanisms provide many benefits (such as alleviating poverty)
and
2. The lack of truly "free markets" manifests itself in things such as big business getting away with bad stuff usually because the government allows them too.
I interpreted your post as mocking free market advocates for holding these 2 views when there is nothing inherently illogical in doing so.
It seems very likely that removing privileges from crony-capitalist would be beneficial.
I also think there is quite strong evidence that freeing markets in small ways makes them more efficient. Perhaps these markets would stop improving beyond some levels of free-ness before we get to truly "free markets".
OK: lets stop when we reach that point.
" there is nothing inherently illogical in doing so."
DeleteThat's right. There is also nothing inherently illogical in believing there are gnomes everywhere that can disappear whenever we try to detect them.
Nor is anything illogical in the "Porteinarians" beliefs described above. They are just impossible to prove wrong, and there is no reason to think they are true.
The lack of truly "free markets" manifests itself in things such as big business getting away with bad stuff usually because the government allows them too. … It seems very likely that removing privileges from crony-capitalist would be beneficial.
DeleteOne of the things he's been trying to say is that when you take restrictions off businesses (i.e. "freeing the market"), they will then move to try and establish privileges for themselves through the legal apparatus. Is this really a controversial and surprising result? Why is it that marketeers refuse to recognize the other side of this?
People have a great desire for easy answers. To actually acknowledge the complexity of the world makes those easy answers implausible... so avoid acknowledging the complexity!
DeleteYou're saying that its impossible to prove wrong statements like
ReplyDelete"market mechanisms have beneficial effects"
and
"one of the attributes of free markets is not permitting corrupt business practices"
Which is what I was claiming in my previous comment.
"market mechanisms have beneficial effects"
DeleteRob, pretty much everyone today believes that, libertarian or not, so that really can't be what the issue is about, can it?
"one of the attributes of free markets is not permitting corrupt business practices"
Yes, this is impossible to prove, because what you've done is simply DEFINED "free markets" as not having these practices.
Here is the equivalent maneuver:
Poteinarian: My all-protein diet will bring you perfect health!
Skeptic: No, an all-protein diet will make you very sick!
P: You are quite wrong: one of the attributes of perfect health is not permitting sickness!
So yes, in one sense, the free market "does not permit" corrupt business practices. But it is imaginary! It is no different than saying "the perfect basketball game does not permit missed shots." And then, as a policy, forbid your team from practicing rebounding, as you believe in perfect basketball.
You said "They are just impossible to prove wrong, and there is no reason to think they are true." I
DeleteI assumed you were talking about the statements I made above (and which seem like a fair reflection of what the imaginary libertarian in your post would believe in order to make the claims you attribute to him).
You now say my first statement is commonly thought to be true and the second is a tautology because of the way the terms are defined. Fair enough.
But I'm now confused as to what exactly it is you are saying is " impossible to prove wrong, and there is no reason to think they are true."
The tautology is treated like an empirical fact, and then used to draw policy conclusions. But when the policy conclusions are questioned, there is a retreat into the tautology to protect the theory from falsification.
DeleteE.g.:
Lib-critic: Promoting the free market in Russia resulted in a massive kleptocracy.
Lib: Ah, then that wasn't really free market promotion! See definition!
ALL bad outcomes from free-market policy advice can be deflected by going back to the tautology, so it can never be proved wrong.
It is no different from how Marxists dodge the empirical results of actual communism: "But the wasn't TRUE communism!"
A libertarian might say:
Delete"it is both possible and beneficial to have a market system with a very low level of coercion".
It sounds like you might say
"It is impossible to have a market system without a significant level of coercion".
Neither of these statement is tautological - and which one is true could presumably be derived (in principal at least) from good theory and empirical research.
Well, let's go a little further, and imagine a libertarian who says, "I think we should try to free up markets in more areas and see how that works out, because they have often improved things in the past."
DeleteAnd I would say, "Welcome, brother! What would you care to try first?"
In which case we agree !
ReplyDeleteI agree that the glib approach you outline is completely illogical, but it might be helpful to suggest a more positive approach which makes more sense.
ReplyDeleteIf we can isolate whether the 'government' (public service, certain regulations, institutions), or the 'market' (private firms, stock markets) are creating either a beneficial effect or a problem, then it is feasible we could simultaneously attribute the 'good' to one and the 'bad' to other. For example, we might argue that protectionist measures such as tariffs did not create growth in the sectors at which they were targeted, while sectors with lower tariffs/regulation grew at a much faster rate. This might suggest that the libertarian PoV is correct about growth & poverty.
Not that I'm saying it is, of course!
Practical wisdom. History. Pay attention to the concrete instead of abstractions.
DeletePractical wisdom. History. Pay attention to the concrete instead of abstractions.
DeleteSo basically don't dawdle around in theory all the time?