Archives for category: Public Policy

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Congress is back in session next Tuesday. The days in session? Twelve. If Republicans don’t rush through cannabis legalization, they will have missed the biggest opportunity for political success — on the order of Democrats’ huge error in opposing the Tea Party (for the stupid, tribal reasons they did).

Missed opportunities are hard to track. But this opportunity, still open, is pretty easy to see. Trump would sign such legislation. He has said as much. And Republicans could (a) express solidarity with the majority opinion on the subject and (b) gain traction with young people, who are especially likely to be against sending marijuana users to jail and ruin their lives by interdiction and prosecution and dispossession.

But, being the Stupid Party, the GOP will not do it. Right?

(Facebook, yesterday)

“Conservatives” and “progressives” are perhaps best seen for what they are on the issue of drugs. For it is here that these two brands of progressivism — socially conservative and socialist/technocratic — come head to head for a kind of weird bipartisanship.

It was the socially conservative progressives (SCP) who needed the illiberal, anti-Constitutional method of the socialist/technocratic progressives (STP), for the old federalism stood in the way of prohibiting alcohol. To get this, the SCPs pushed women’s suffrage and the income tax. These two allowed Prohibition to go national, which was the SCP flagship policy. It was a disaster, of course. And was later repealed in Progressives’ even greater debacle, The Great Depression (yes, it was caused by their policies).

But the STPs had what they needed, the foundations to develop the welfare state and the therapeutic state. That is, the welfare state and the therapeutic state were built, both, on the basis of the female vote and the income tax, and the cultural excuse that Prohibition gave — though Prohibition was ended by constitutional amendment, the general policy was secured at every level, including federal; there would be no real pushback from SCPs (who came to call themselves, with some but not much justification, “conservatives”). And the general progressive mindset allowed them two world wars, and the two wars allowed experiments in “war socialism,” which in turn paved the way for federal regulation and the full panoply of the Administrative State, plus vast programs of redistribution, including Social Security and much more.

And, with all these programs that pleased the STPs so much, there remained the psychoactive drug prohibitions, as a sop to the SCPs. And, of course, the STPs let the states regulate alcohol, in a pretense form of federalism, as a vestige of Prohibition.

I could go on and on, but you see the general tenor. The Republican Party is the SCP party, and the Democrats make up the STP party. Progressivism has triumphed, and Republicans are so ineffective because they do not realize that they embraced the progressive meme long ago, and that it corrupted their souls. And their politics.

(from LocoFoco.us on Facebook, yesterday)

A bill is in play. But it is bipartisan. Republicans should have made it partisan. Or must it be bipartisan because there are enough Prohibitionist in the GOP? What an idiotic coalition the Republican Party is. Even social conservatives and religious Christians have reason to support decriminalization (I prefer full legalization at the federal level). But this group of people are the second least politically astute group in the country.

A friend responds:

You underestimate the buy-in they have on the drug war. Two-thirds of the Republican voters have a Jeff Sessions level religious anti-pot mindset (shared by 1/2 of the democratic voters). Polling will have shown them that any caving on the drug war is going to result in more blow back from their base.

There are certain things each political party cannot do no matter how much political sense it makes. An outsider can come in with these issues and run as an R or D and get independent voter support, but someone who has come through the ranks can’t.

I volley back:

For the same reason the Democrats “had” to attack the Tea Party — not because it was ideologically required or good politics in the long run, but because it was a culture war thing. This is why I hate the two parties.

(Facebook, yesterday)

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Why rob banks? Cuz that’s where the money is!

This principle, er, old joke, helps explain a recent Republican brainstorm: how to secure for Americans that very European subsidy, paid “parental leave.”*

The new idea is to pay for the desired time off with Social Security funds.

Social Security is, after all, a ginormous funnel through which a huge percentage of nearly every worker’s wealth gets “redistributed”: from young workers to retirees, from today to a distant tomorrow.

So, siphoning some largesse off for this wish-list item strikes some folks as natural.

Who are these geniuses?

Well, The Hill reports that “Sen. Marco Rubio (R-Fla.) is working with Ivanka Trump to craft a paid family leave plan that will appeal to fellow Republicans,” and cites Sen. Mike Lee (R.-Ut.) as with Rubio in that endeavor.

“Such a proposal,” The Hill elaborates, “would address concerns of Republicans who don’t want to raise taxes to pay for family leave.”

Shikha Dalmia, writing at Reason, expresses the obvious concern: “it isn’t like Social Security has a ton of spare cash lying around to dole out to people other than retirees.”

But, not so fast: Republicans have given the notion a tincture of plausibility: they’ve pitched the program as a way to “take control of one’s Social Security account.” The “paid leave” would be treated as early withdrawals from Social Security, offset by postponing retirement.

Unfortunately, we don’t have real accounts. Each participant has a list of tax payments and a schedule of promised benefits — legally changable at any time. The proposed offset would itself be offset by the bringing forward of Social Security insolvency.

The willingness of politicians to rob the Social Security “kitty” is, apparently, something we can always count on.

Which makes Social Security itself something we can count on even less.

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* Remember when the idea was just half as big? That is, when it was mere “maternity leave”?

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I have friends who are entirely dependent upon the State for their livelihood — and I am not just referring to elderly retirees. Most of these aid recipients have received disability retirement pensions from the Social Security system. These folks are not in any way anomalous in American life. You might be surprised to learn how many disability recipients there are.

More interesting, however, is this fact: no small number of these folks — indeed, most of my friends on state aid — are not die-hard Democrats demanding vast increases in the size and scope of the welfare state.

Not a few are conservatives — one of my closest friends is an authoritarian conservative of the Bill O’Reilly sort — and they rail against lazy people and welfare queens and all the rest.

Yes, they think and vote this way even though they are mostly or entirely dependent upon the taxpayers.

What is going on here? This strikes many people as paradoxical. Many are the Democrats who think that “being a Democrat” is precisely what these state aid recipients should be: grateful, die-hard supporters of the welfare state, devoted to its expansion.

After all, the Democratic Party is the party most enthusiastic about state aid programs like this. And Democrats expect fealty.

What is the matter with Kansas? asked one prominent leftist scrivener. So many Kansans would be so much better off if they voted Democratic and siphoned more special favors off the state — ultimately, off of producing Americans — and “as a matter of right.”

Vladimir Gimpelson and Daniel Treisman, writing in the Washington Post a few years ago, expressed their wonder as to why the very poorest of the poor in our country are so lax in their demands for more redistribution — for programs and handouts that (our querists think) would be “in their interest.” The two professors’ think piece (a summary of an allegedly scholarly study) is entitled “Why don’t democracies take from the rich and give to the poor?” and it presses the question, seeking answers:

Since the time of ancient Greece, political theorists and observers have feared that inequality leads to instability. The greater the income gap, the more the poor have to gain by taking from the rich. In democracies, the thinking goes, inequality should predispose voters to demand government redistribution. In dictatorships, the rich, fearing Robin Hood policies, should resist democratization. And the poor, locked out of power and wealth, should be more tempted by revolution.

Though these arguments have been around since Aristotle, it’s hard to find evidence for them in the real world.

And they cite some recent scholarship on this. Democracies do not turn revolutionary.

Why? Scholars have suggested a variety of things that might derail political unrest. Belief that the economic system is fair, or the hope of being rich someday, or even organized religion might reconcile people to the gap between rich and poor. Or it could be that, with their assets hidden in Swiss bank accounts, the rich these days have just become too hard to expropriate.

But there’s a simpler possibility: Maybe inequality fails to trigger the expected political consequences because most people just don’t know how large the gap is between the wealthy and the rest of us.

“If people don’t know how much they stand to gain and at what cost,“ they conjecture, “why would they take political action?”

Amusingly, that “if” premise is only half-interrogated:

We looked at eight cross-national surveys to see what people believe about inequality. Time and again, large numbers of respondents had no clue what the income distribution looked like in their country, how it had been changing recently, and where in that distribution they personally fit.

The authors conclude that while “Americans still seem relatively relaxed about income inequality,” that may very well “be changing.”

Right. But though the subject of the (in)elasticity of demand for redistribution is interesting for several reasons, my concern is different. Indeed, I wish to begin by interrogating the part of the premise the professors take for granted: do the poor really have anything to gain by increased redistribution of wealth?

As present, after all, the fifth and lowest quintile of market income earners in America do not pay federal income taxes. They are, in fact, net tax consumers. Maybe the poor do not demand more because they have an inkling about how much they get now.

Actually, I suspect that the poorest grossly underestimate the levels of their subsidy. Indeed, I suspect that Professors Gimpelson and Treisman — economist and political scientist, respectively — would underestimate the current levels of subsidy. You see, our professors at the Post are only interested in “income inequality” and how it is perceived, and how these two things stack up against the demand for further redistribution that they have somehow measured. (Maybe I will carefully read their paper, but I haven’t yet, and nothing they write suggests to me that they are onto something very important.)

So, what is the level of subsidy in America? Well, after-tax, after-subsidy incomes show that the lowest income quintile in these United States have an effective (net) negative tax rate of over 200 percent:

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That is, they do not pay taxes, net of the full panoply of state benefits (SNAP, SSI, Section 8 housing, etc.). They get subsidized to the tune of 213 percent.

This is a huge amount of handouts. Sure, too many businesses receive subsidies in America — far too many — and some rich folk make a lot of money off the government, but, evened out, it is the poor who right now do get the lions’ (or pigs’) share of redistributed wealth.

And it is rather astounding that our two professors of egalitarian studies (for that seems to be their real profession, here) nowhere indicate that the poor right now are living off of the rich. Our professors just assume that “the poor” should demand even more.

Now, I could spend many paragraphs explaining the complexities of income statistics, the slippery nature of the “increasing inequality” meme. Because it tracks statisticians’ artifacts — a five-fold division of society by incomes — and the amount of wealth that changes in these quintiles, and not the majority of individuals who do indeed move from one quintile to another and then back again as they navigate the arcs of their lives, all this inequality talk is mostly confusion and error. But I am going to let others handle those niceties. I am going back, doggedly, to that basic query: why don’t the poor demand more?

Yesterday, on the YouTube show Right Angle, Steve Green, Scott Ott, and Bill Whittle offered some possible answers — responding to the Post piece:

  1. “There aren’t enough poor people” in our country to actually vote themselves more — America is richer than you think, says Steve Green. While the professors think the poor overestimate their wealth levels, Green in effect says that the professors overestimate the number of the poor — and in a democracy, numbers count.
  2. And Green offers another reason for lack of egalitarian envy: “even our poor people are kick-ass Americans.”
  3. Bill Whittle suggests that our poor Americans have more than a hunch that, by world standards, they are rich — and yes, our poor are richer than many another country’s poor. It would be ungrateful to demand more. And perhaps (Whittle moves on quickly) our poor have a broader perspective — and more “moral fiber” — than our professors.
  4. Whittle also wanders into the point hinted at above: this talk of income quintiles obscures the truths of income mobility. The American system of merit “allows people to move up and allows people to move down.” Given this reality, it would be stupid for the poor to scuttle their best way out.
  5. Scott Ott notes that, as a general rule, the folks most exercised by income inequality are people far above the gutter. The suggestion here is that maybe talk of income inequality does not really serve the poor. Maybe it serves a class or classes of the better-off. Alas, Ott does not explore this latent idea in his answer, but goes on to speculate that America’s low-income earners just do not buy into the solution as a workable feature to rise out of their ruts.

To explore the notion that Ott skips over too quickly, you might best turn to netizen-philosopher Stefan Molyneux, who talks about “languasites.” In a world of Makers and Takers, these “language parasites” find tricky ways to assuage the fears (and other anxieties and insecurities) of the Makers and thus leech off of them. A grand example can be found in Lucian of Samosata’s Hermotimus, or The Rival Philosophies, in which we encounter an earnest student of Stoicism milked of his wealth and diverted from his youth in the vain pursuit of . . . enlightenment . . . which is translated as “Happiness” in the edition I own, Marcus Aurelius and His Times: The Transition from Paganism to Christianity (1945), Irwin Edman (introduction), p. 172.

This idea of the linguasite (“tongue parasite,” with some loose construction — but surely better than “languasite”) is awfully pregnant, and it might be useful to prod Molyneux further on just who does and does not fall into that category. But the idea is fairly clear. And in the context of the income inequality obsession, what we have here are the second-hand dealers in ideas who F. A. Hayek wrote about. More importantly, we have a class idea, here. Many members of the cognitive elite somehow find themselves ensconced in key positions in the welfare state. Might not they develop a natural class interest in promoting the idea no matter its effects on the poor themselves? College professors, for instance, are consulted by bureaucracies and legislators, and teach many future government functionaries, lobbyists, lawyers and journalists who make their livings transforming society away from the ugliness of consumer-determined merit and into “rationally-determined” social justice.

And here we come to the interesting aspect of the welfare state: the establishment of classes based on state redistribution.

Now, we have to forget Marxian analysis, for his simple oppression/exploitation theory of class was based on a misconstrued of the nature of trade and productivity in a market economy. And we can glide right over the classical liberal class theory (very interesting, and not entirely irrelevant) that Marx pilfered to concoct his grand farrago. We should turn to Joseph Schumpeter, instead.

imageClasses form around perceptions of success, wrote the great economist in an under-appreciated study. “What makes a subgroup of society,” I wrote in the Laissez Faire Books edition a few years ago, “‘organically’ related enough to qualify as special, as constituting a class?” The answer can be found in “social factors like honor, which was, after all, the basis of the first major governance system of civilization. And honor depends on — is, indeed, obsessive about — success. It is not failure but success that ‘exerts a continuing effect’” that forms a class. But let us turn to Schumpeter for a fuller picture:

[S]uccess brings in its wake important functional positions and other powers over material resources. The position of the physical individual becomes entrenched, and with it that of the family. This opens up further opportunities to the family, often to an even greater degree than to the successful individual himself, though these positive factors are to some extent offset by the deadening effect on the original impetus of exalted position and security, by the diversion and complication of interests, and perhaps also by the sheer exhaustion of energies which everyday experience shows to be not uncommon. Coordinate families then merge into a social class, welded together by a bond, the substance and effect of which we now understand. This relationship assumes a life of its own and is then able to grant protection and confer prestige.

I speculate that one of the great triumphs of the modern welfare state has been to reroute the mechanisms of class away from natural groupings like family and clan and into the artificial, state-bounded and -funded institutions like the Academy.

And maybe one reason professors promote redistribution, in their writings and lectures, more enthusiastically than the poor do, with their votes, is that the subsidized poor serve as trophies of the cognitive elites. Perhaps increasing state redistribution is not advocated by the elites because it really helps the poor, but because it is emblematic of class success, and thus class cohesion and prestige. The poor do not gain prestige by sucking up more taxpayer-funded resources. But boy, members of the cognitive elite do!

But is that all there is to it? Class interest?

I think not. I suspect, anyway, a bit of economic rationality going on here. I suspect that not a few normal people look at the demographics of redistribution and become alarmed. My wards-of-the-state friends are dependent upon continued support. Increasing the ranks of the recipients, or even the amounts generally redistributed, does not make the system they depend upon more secure.

Do you see the incentive here? No small number of state aid recipients oppose expansion of the programs that support them. And while socialist ideologues might think that these clients of the State are somehow naturally beholden to a robust welfare state ideology, and that by voting Republican (or worse, Libertarian) they are “voting against their interests,” this is simply not the case. People “on welfare” have a very compelling interest to not support the increase in the size and scope of the programs that supports them.

Let me restate why: increasing the number of recipients of such aid programs could very well jeopardize the financial stability of those very programs, endangering the livelihood of current recipients.

This is a very basic point. To not notice this point is to miss something about the nature of economic redistribution: that it depends on a larger population of contributors putting wealth into the system than taking out of it. The more recipients of taxed funds we add puts a strain on those taxed, especially if the ratio gets out of hand. On pure economic grounds, it makes sense to be a member of a small group gaining at the expense of the majority than a large group gaining at the expense of a minority.

We cannot all live at the non-reciprocal expense of others.

One might call this perspective common sense. But it is not “folk economics” — it is theoretically sound; the rationale works out in extended analysis. Indeed, one of the problems with the sustainability of Social Security in the United States — and of similar programs throughout the West — is that the ratio of contributors to recipients is getting smaller. The trend line is foreboding. It is the reason we are at last taking Social Security off the proverbial “third rail” and contemplating reforms such as raising the retirement age and raising the income ceiling for FICA contributions, er, taxes.*

What is astounding to me is that this elementary fact of redistribution — that it cannot be complete, that socialism itself is a fantasy never capable of delivering on its promises, for we cannot all be Takers. There must be Makers. And there should be a reasonable ratio between them to make the programs sustainable.

That this notion of redistribution has seemingly evaporated from the public conversation strikes me as odd. I do not even hear libertarians, the strongest critics of government redistribution of wealth, bring it up very often, and cannot now think of an instance where it became part of a general theory of redistribution. But the more I think about this, the more basic it seems.

Indeed, it applies to criminology, too: the more theft going on in society — and remember, theft is merely the illegal redistribution of wealth — the more crime would drag society down. It is in the interest even of criminals to discourage crime generally. Perhaps for this reason (if not this reason alone) criminals rarely oppose laws against theft and murder and the like. They realize social systems cannot be stable where everyone plays criminal. They simply make an exception for themselves. They try to bet against the house, hoping to squeak through the cracks of the system and gain “rents” that would evaporate if too many criminals tried to game the system. It is instructive to recognize the fact that criminals themselves rarely even try to take up the pretense that theft and murder are good ideas to spread around. It is as exceptions to the rule that criminals’ livelihoods make any sense at all.

That is perhaps one reason why, when crime becomes “organized,” territory and limitation of criminal acts according to “honor” and other codes, become common. It is also one reason why police often are deferential to organized crime: a monopoly of a service limits the supply of the service, and criminal monopoly is better than no such monopoly, which would mean more crime. And thus greater the threat of unsustainability. Yes, crime can serve as an excellent example of “market failure” — that is, for situations where the criminals, acting in their separate self-interests, yield themselves a net detriment, not benefit.

All of this reiterates one basic thesis: leftism is parasitic upon the system it despises. Nearly all leftists I have ever met abhor the idea of “profit.” They consider business activity necessarily “dirty.” They are distrustful of markets, and see in markets only internecine competition and, in fact, predation and parasitism.

This view of social life I regard as obviously and completely at odds with reality, the inverse of the truth. Redistribution is parasitism. Leftism is the philosophy that parasitism via State redistribution is good in and of itself — perhaps better than production in the market. And socialism is the bizarre notion that “we can all be parasites” — though of course socialists do not state their doctrine in such a bald, unvarnished way. Instead, socialists cook up shaky theories purporting to show that market distribution is not productive, that the rich who gain so much by trade are in fact “exploiters” of the poor, and that the poor would be better off without the rich . . . or at least better off were the rich sucked dry.

It used to be understood among old-fashioned Progressives and FDR/LBJ-style “liberals” that one could go too far in redistributing wealth. But by earnestly grinding through their rationales for taking from some to give to others, modern progressives have lost sight of the basic realities inherent in the system they propose. And so they cannot see — or at least countenance talking about at any length — any point in emphasizing those limits.

This can be clearly seen in the cultural divide between The Tea Party and the Occupy Movement. The Occupiers characteristically demanded more redistribution and more regulation and generally derided the evils of big business. The Tea Party, on the other hand, was concerned with curbing government spending and aiming to balance budgets. Democrats mocked those “tea baggers” who seemed to misunderstand basic realities, such as when signs were held aloft saying “Keep the Government Out of My Medicare.” And that sort of thing is indeed hilarious. But the idea still remains that adding people onto Medicare rolls and under-funding the system does not help people who have come to rely upon Medicare.

So the signs really meant “Keep Progressives Out of My Medicare.”

But Democrats — who now seem almost uniformly “progressive” — have missed the point. They cannot see sustainability as a legitimate issue. Politicians like Sen. Elizabeth Warren have gone so far as to call the conscientious Tea Party activists “anarchists.” It is hard to imagine a more absurd charge. But, when you hold to the crazy idea that more government is always better government, you will tend to say absurd things.

So we exist now at this strange point in history when the Democratic Party has lost its grip on power even though it is the party of special interest promises and Potlatch “generosity.” The last moment of possible turnaround for the Democrats was, I think, when they turned on the Tea Party. Had they embraced the Tea Party, and made a public effort to rein in spending, they would now be dominant and their hold on power unassailble. But that was not to be. They had become so blind to the realities of redistribution and its parasitism upon productive capitalism that they lost savvy people even amongst the recipient cohorts. Sure, leftism has always been parasitic on the system it hankers to destroy. But parasitism only works on a principle of hormesis. It is the hygiene theory of immunity as applied to the body politic. The hookworm is the parasitic drain. Too many, and the host dies.

The idea that progressives now regard contemplation and discussion of this principle utterly verboten says a lot about their divorce from reality. Their fantasy now runs their policy prescriptions. And it may very well be a function of class prestige that is one of the drivers for this. Sure, there are other factors — like the socialist soteriology, or the entelechy at the heart of the left’s other-obsession memeplex — but we should not overestimate the wisdom of the elites or the folly of the poorest among us.

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N.B.  There is, of course, another very basic reason for state aid recipients not to support increasing the register of aid recipients: they may want to think of themselves as deserving recipients, and fear that others placed on the rolls for laxer standards might be seen as unworthy, or as being dangerously discouraged from finding alternate means of support. And the more folks going onto the rolls for comparatively trivial reasons might poison the well politically, and tar all recipients as unworthy of help. To what extent this fear is a rational, moral or merely a petty rationalization, I will consider at another time.

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This is the golden age of clever analogies. Short “memes” get shared online, and many of them are quite good. And then there are the ones that fall apart.

Consider this effort in the Ban The Guns Sweepstakes:

I assume this “phil h” fellow invented it. And the first time I saw it, I thought, “not bad.” But the second and third and fourth time I saw it? I saw the problems.

A lot of my friends immediately objected to the condescension in the example: statists treat us like kids. Children.

But it’s worse than just that. The condescension is double: he talks of “giving” out sticks. As if what people possess were a matter of what they “receive” rather than what they work for, earn. Have by right.

But the most deceptive aspect of the meme comes in Option C: it uses a singular construction, not the plural that would parallel current debate. The gun grabbers mean to take away “all the sticks.” Not just the malefactor’s stick. But by leaving this in the singular, we are subliminally cued to understand this in a more reasonable light. Adults do take away sticks from irresponsible kids. And perhaps use the stick to swat the little malefactor on the behind. That’s nothing like what leftists really are up to. They want all the sticks taken away.

And think again about that “give” and “take away” — this language completely distorts how kids actually acquire sticks. A realistic scenario would reformulate it as “let kids find sticks and play with them” in contrast to “take away all sticks and denude the trees and parks of branches and. . . .”

The authoritarian attitude is just a part of the paternalist/maternalist Family Model of the State. It’s the wrong model, as should be obvious in this debate. And especially in this really pathetic attempt at persuasion.

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The more diverse a people are — the greater the variety of ethnicities, languages, cultures, folkways — the less extensive a government they can peacefully share. Real diversity requires limited government. Only in monocultural societies can robust, Leviathan government remain sustainable for long.

The reasons for this are not hard to fathom. The chief of these is the tragedy of the commons.

A government in the form of a republican State (a “liberal democracy” as it is sometimes called) is conceived of by most of its proponents as a shared resource, established for the good of all — a “commonwealth.” But common resources require regulation to prevent individuals and groups from abusing and over-using the resources — that is, adapting to the common resource opportunities by gobbling up more for themselves than for others. And by “adaptation” I mean altering their behavior and their way of life to enable them to secure more common resources. And, as anyone with a lick of sense knows, self-regulation would be ideal. It’s the least expensive way to maintain the institutions, secure their long-term viability. Hence the importance of a monoculture.

enjoy-capitalismAristotle wrote about this. But I haven’t read Politics in 40 years, so I forget if the great philosopher applied the commons problem idea to the form of government itself. (I will let someone else look it up, or just tell me.) Economist W.F. Lloyd wrote about this in the 1830s, and ecologist Garrett Hardin made it famous in the “tragedy of commons” phrasing in our time. Hardin applied it to environmental resources, but it also applies to State-marshaled resources of any kind, including wealth obtained from taxes. Public Choice economists have been working on these problems for about the period of my lifetime, though Vilfredo Pareto clearly understood it in his critique of socialism at the beginning of the 20th century.

It was this idea that helped lead me to prefer limited government as a general policy in the first place. It should be easy to see that the more similar people are, the more likely they are to forgo overusing public resources. Why? Out of kinship altruism. But this sort of forbearance is harder to generally maintain in diverse populations, so there is a tendency for welfare states to turn into “churning states,” where the web of “everybody trying to live at the expense of everybody else” becomes so complicated that no one really knows who the net benefactors and net beneficiaries are. This leads to poltical strife, and … our present situation.

IMG_2027The Scandinavian states have been moderately successful with a robust redistributive state in large part because they have been so genetically and culturally uniform. And yet, over time, the moral probity that prevented overuse of common resources has waned, and permanent dependent classes have formed. Oddly, these countries have been importing these dependent classes, too, mainly from Muslim countries, so I expect these states to fall or undergo some significant kind of revolution in a generation or two.

Note, then, how wrong today’s progressives are. Driven by liberal piety, they insist upon diversity. And yet their politics is one of class division combined with socialistic government growth, which undermines sustainability. It is inherently contradictory.

More contradictory yet is their internationalism. Nationalism — indeed, ethnonationalism — is the surest sustainable way to keep welfare states going in the long run. So progressives are wrong and the so-called “alt-right” is definitely correct. If you want extensive state action, you need to draw boundaries along ethnic or “racial” lines. And indeed we find that alt-right maven Richard Spencer, after scratching the surface of his poses, has proven to be an ardent supporter of the welfare state.

Now, there are several other ways (serving as alternatives to ethnonationalism) to counter-act this commons-overuse problem. The chief method, in our time, has been consumerism. Consumer culture has broken down ethnic divisions, and can indeed make populationsmore uniform the better to be ruled by — and encourage support for — an extensive “welfare state.” And once again we find progressives utterly on the wrong side, for they pretend to be against consumerism, and their hatred for big business works against the only cultural factor that could possibly make the politics of social democracy work in a diverse population.

For my part, I prefer actual diversity, and believe that a rule-of-law-based polity is the way to go, so I oppose both the pathetic alt-right and the contradictory mishmash philosophy of progressivism.

Yes, I’m a real liberal. I do not just spout liberal pieties, as does today’s left, but I embrace the liberal spirit of tolerance of diversity, which the left, today, does not (their class warfare version is faux-diverse, and in fact promotes commons overuse). And I also wish to establish long-term social institutions, not institutions subject to takeover by special interests and run along exploitation lines. Democracy in a welfare state is as contradictory as a welfare state in a diverse society.

So, you may have guessed it: diminishing the scope of democratic action is another way to control overuse of common resources. On the left this is done by seeking to limit lobbying of government (a basic right under our Constitution) and setting up of complex bureaucracies and guilds of power, immune to electoral shock. On the right we have . . .

Donald Trump.

IMG_1929Trump sure seems anti-democratic, and that is a possible solution to save the welfare state from its most hysterical advocates and its abuse from group interests at the public trough. And, let us admit, that is precisely what modern conservatism is all about: saving the welfare state from the progressives and their insane prodigality. (Conservatives do talk about building down the welfare state, but that’s just their piety; it does not seem to be a real goal. Demonstrated preference tells us this.)

Since I’m not a conservative, you see why I dislike both political parties and the major factions within them. And why I don’t get on board with Trumpism.

I can find Trumpism funny, however. Why? Because modern ideologies are so incoherent that Trump serves as the cutter of Gordian Knots; he’s the Mule (as I’ve said any times); he’s the Loki figure. Whether this will save the welfare state, or bring it down faster, I do not know. While we wait to see what happens, Trump’s bizarre antics entertain.

He and we fiddle as the Empire burns.

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Written for but not published on Facebook*:

I just learned that a few years ago Germany’s Merkel had asked Facebook’s Zuckerberg how he was working on suppressing dissent from her immigration policies.

This is the nature of government, and of “the left” today. Center-leftists are the new conservatives, suppressing and molding thought and discussion to bolster their policies in the name of their values, not the values of an open society, much less the principles of free speech.

F9A994CB-3822-4302-8BAB-32A6D15A8D4AAnd I know, I listen to my left-leaning friends here* on Facebook: on the whole, you folks (oh, ye of much faith … in government) don’t dissent from the suppression of free thought and the expression of ideas and values and policies you do not like. Indeed, you cannot imagine someone having a different thought from you on obviously controversial policies (such as what you think of as the obviously correct and quite simple implementation of anti-racist and anti-sexist agendas) and that they could possibly be valid.

This doesn’t make you “edgy,” it makes you conservative. Retro. Reactionary. Sure, your policies are not associated with “conservative” “principles,” but your methods are conservative. You are shoring up Progressive Era institutions, and trying to extend them. But you do not want to upset the establishment. You are the establishment.

4CD881E5-1B34-412D-9FB1-0E412F3C2E3BAnd believe me: you are just as overbearing as conservatives seemed when I was young.

For the record, I find your ideas, analyses and regular outbursts of moral umbrage to be, for the most part, ridiculous.

Sure, the nominal conservatives “on the right” are ridiculous, too. But they are obvious goofballs and cretins. You folks still pretend to yourselves — and manage to pull off in public — a farded-up public face that still almost passes for sophistication.

But your mascara is running, and your imperial clothing is being pointed out to be non-existent. Soon, three-quarters of the world will be laughing at you.

No wonder you are desperate. And no wonder your desperation is showing.

twv

* I chickened out. I did not see the point in insulting half of my friends and family. Though they deserve it, sure.

C101AD62-2830-4978-8F58-AF94D3EF73A6

Three decades ago, I was briefly involved in a campaign in Jefferson County, Washington State, to prevent nuclear warheads from being stored within its borders. I knew it was a hopeless endeavor — there seemed zero chance for local government, spurred by idealistic citizens, to prevent the U.S. Navy from using nearby Indian Island as a maximum security repository for missiles and warheads taken from submarines scheduled for maintenance at Bangor Trident Base — but it did introduce me to the leftist activists in the northern parts of the Olympic Peninsula.

The fit was not always comfortable. Among many interesting moments with these people, I remember most clearly my first encounter with an angry feminist. And with clueless feminists.

FD110687-98A7-4289-95AC-B972EE0200C6But the biggest difference may have regarded our different ethical approaches. I was not prone to the same sort of moralism that they were, for one thing. Or Utopianism. I also had become convinced that MAD was a successful policy, on the whole, and that the traitorous Rosenbergs may have inadvertently served as the saviors not only of America but also of humanity. So I occasionally said things more than a tad out of place amongst the activists.

One of the odder moments of mutual incomprehension concerned the reasons to oppose the bomb storage. I offered a NIMBY argument, and mention the threat of terrorism. “Indian Island is a target.” The activists looked at me blankly. They were uninterested in terrorism. Terrorism was not on their radar, except, I suppose, as a tactic that they could imagine themselves using, push come to shove.

I remember Bob the bookseller looking at me, puzzled, having caught the implication of my logic. “Where do you want the bombs stored?” he asked. “And how many do you think we need?”

“How many nuclear bombs would you like?” That last question was rather pointed.

I had no idea, of course, so I shrugged. I am generally not good at prescribing for an institution I am not in any way responsible for.

C431E517-A2BF-4990-A419-D3BF9FF48CFCHonestly, I thought terrorism was the wave of the future. A few years later, after Bush’s invasions of Panama and Iraq, I was more confident yet. Sure enough, my suspicion proved increasingly savvy over the years, constituting one of two sets of prophecies that showed me not a complete nutball. I felt satisfied, I confess: I understood some things about the way the world worked that most people did not seem to. At all.

Yup, terrorism and the price of gold. I was right, way back then.

Now, I have no idea what is going to happen next. My hunches are all over the place, between financial Armageddon and the Singularity!

twv

N.B. Pictured are three Google maps of the area in Jefferson County where I lived at the time. Circled in red are where the offices of Liberty magazine were listed with the Post Office (the Polk Street apartment building I lived in) and (at bottom) they were actually located, on top of the hill. One of my first jobs for Bill Bradford, Liberty’s publisher, in my first year or two working for him, was Community Plenipotentiary. That is, I would get involved in community activism so he would not have to! Yes, he paid me to do this sort of thing. Thankfully, it did not take up much of my time, and arguably I did it on my own time. I was not being paid by the hour.

I try to read the MoveOn emails I receive several times a week. Yes, I try. But they are very trying.

Just this morning I got an email from “Bernie Sanders” . . . which began “Hi Timothy — I just wanted to make sure you saw my message from the other day.”

Must be important.

So what does “Bernie Sanders” say?

Well, he pushes what he (or his copywriter) call “the progressive agenda,” which is dead set against the “corporate giveaway” in the new tax reform bill. Here is how he begins:

Throughout my political career, I have asked us all to imagine what our nation’s future could be: a country with a minimum wage that is a living wage; with students graduating college without crushing debt that stifles their ability to pursue their dreams; where health care is recognized as a right for every man, woman, and child; and where we lead other nations in the fight against climate change.

I have asked us to believe that we could level the playing field and create a vibrant democracy where the billionaire class would no longer be able to buy and sell our candidates and elections.

I will always believe in that vision of America — even as I watch Republicans try to pass a tax scam that is literally the opposite agenda of what you and I have championed over the years.

A tax scam. I wonder: does it increase taxes on the poor and the proverbial “middle class”? I doubt it, but I honestly do not know. The only “fact” about the tax bill given is that it decreases taxes on the wealthy.

I assume by that he means decreases tax rates on the wealthy. There is a difference between rate and revenue. The difference should affect the way we talk about taxes. Somehow, it almost never does.

Bernie, if you could help me on this, please explain. Comments are open below.

Lacking many specifics from this pitch letter (and, after all, that is what most MoveOn emails are, pleas for funds — the only other regular pitch being calls for action, usually to complain to my congressperson), I wander back up to the top. Bernie Sanders imagines an America with “a minimum wage that is a living wage”; with college students not starting their remunerative careers buried in debt; “health care” treated “as a right” for all; and the country leading the world “in the fight against climate change.” Each point is worth thinking about. But I am going to avoid the “climate change” issue entirely, focusing, instead, on the climate-of-opinion change regarding matters nearer at hand.*

The Ass Ceiling

Minimum wage laws were one of the two big issues regarding economic policy that turned me away, forever, from Bernie’s brand of politics. The first time I heard someone assert that minimum wage laws hurt some low-skilled workers while helping competing workers with higher perceived skills, I got really interested in economics. As a science. I wanted to see how this could be the case, if it could at all.

I learned two things right away: one must move beyond slogans and look at what laws are at base, and then what their effects are beyond the policy’s immediate targets.

At base, minimum wage laws proscribe hiring people at a rate lower than set by the “minimum.” A minimum wage regulation does not require businesses to hire anybody at that rate. Such regulations prohibit businesses from hiring anybody below that rate. So, by their very nature, minimum wage laws are employment-limiting laws.

That puts the burden of proof on the proponent of the “minimum wage” to explain how it could increase the ranks of the employed, or, at the very least, not decrease those ranks. If employment decreases — either immediately or in the future — then minimum wage laws are not boons to the poor, lifting poor workers out of poverty. Instead, they would constitute mere redistribution-of-wealth schemes: in effect taking from some poor and giving to others, making them less poor.

The import of this idea has yet to hit at least half of the population.

The working out of the wider and long-term effects of wage-rate floors (as economists tend to characterize the regulation) gets complicated. It comes down to productivity — the marginal product, actually — and interesting scientific study can work out the complexities. There are debates to be had.† But what is interesting about political discussion, particularly from Bernie Sanders and his cadres, is that such discussion is never forthcoming. The usual defenses of minimum wage regulations that I hear point to the bizarre Card and Krueger studies, and not as economic explanations, but as excuses, as authority to dismiss economic reasoning entirely — with no more intellectual integrity than nyah-nyah taunting. “My study is better than your study”!

The popular use of these contrarian studies (and yes, most studies of minimum wage law effects disconfirm the stated utility of the regulations) is not to advance knowledge, much less explore how any particular study is constructed, but because it gives an excuse to hold to a policy endorsed for non-scientific reasons.

imageI know this because I felt their pull. The love of “minimum wage” regulations is part of a belief in the efficacy not merely of government but of activists who propound simple nostrums. It is a very religious commitment, and when I looked into the issue, nearly four decades ago, and studied my own psychology as well as economic theory, I concluded that my motives in promoting the wage floor were not pristine.

As always in such issues, it comes back to the Seen and Not Seen. What we “see” is a minimum wage law, and people employed above the prohibited low rates. We do not — and cannot — see the people that would have been employed had such regulations not existed. The counter-factual world is closed to us. And yet the reality of our experience is entirely encompassed precisely by such counter-factuals, since, when we choose either a job or a policy (or a career or a spouse or a philosophy) we are forecasting two or more possible worlds of effects that would result from a choice one way or the other, and those forecasts are not illusions, but guesses as to possible realities that, after the choice is made and the action (or policy) instantiated, only one of which becomes factual, actual.

By sticking to the Seen effects of minimum wage regulations, the enforced floor’s proponents allow themselves a smug sense of “sticking to the facts” while denying a basic part of reality. Meanwhile, they become acolytes to a particular religious view of life, wherein the State is savior and activism is ritual and prayer.

And, all the while they go about promoting one of their favored nostrums, they ignore the reality: wage floors are worse than the proverbial “glass ceilings” of feminist lore. The floor is raised, hiking the productivity requirements of workers, placing those unable to perform at the set level below the floor, looking up at the . . . feet and asses of those who remain employed. The People Under the Floor have been condemned by the regulation, with no more hope for them other than subsidy.

Oh, sure, they could get more skills, and that is indeed one thing progressives have always insisted upon: that people who want to work go to progressive-run schools where productivity is allegedly taught (it isn’t, for the most part) and the bills are paid from taxpayers. Indeed, unable to work because prohibited from doing so, the likelihood of skill acquisition is diminished for the low-skilled, since actual work is the single most important source for acquiring skills. And, indeed, most of those trapped under the floor are there in no small part because our society’s prescribed basic training ground, the public school, has proved to be ineffective (for a variety of reasons). No wonder, then, that The People Under the Floor turn to black markets and government handouts. That is pretty much all that is left them.

That is what Bernie Sanders and his kind have left them.

I shudder when I think about the People Under the Floor. And I try (often not successfully) not to be angered at the progressives most intent on policies that keep them there.

The takeaway that is so rarely taken, is this: the wage floor is an ass ceiling for the forcibly unemployed.

But Wouldn’t It Be Nice?

The interesting thing about progressivism is its relentless moralism. The subject line of Bernie’s email is “Stop this immoral disaster.” Calling something “immoral” often excuses one from thinking about it in any practical way. Bernie was talking about the tax issue, but his lack of any specifics is just indicative of this sort of mindset.

When I call something “immoral” or “evil,” that means that I have stopped careful consideration of it, too. Them’s fighting words, words of action.

One just hopes that there is some thought upon which that judgment of immorality can be based.

In his earnest (if under-thought) wishes for a debt-free beginning to careers (Bernie himself was a slacker, and then entered Congress in a great binge of living off the system) and for automatic, care-free medical assistance for all, Bernie seems driven by a utopian vision, an Edenic myth, backed only by

  1. activism and
  2. subsidy from the rich

IMG_4679Indeed, this email sums up his whole approach. It is an appeal to activists to support more activism that would (the scheme runs) lead to government action that would take from the rich and give to the not-rich. So no wonder, in all this, it is important to mention the awful spectacle of billionaires “buying and selling” — no talk of renting, interestingly enough — “our candidates and elections.” The big money game in politics is there, of course, because big money is what it is all about. Bernie S. and his fellow B.S.ers demand that “the rich” subsidize them more. Which is about money. Lots of it. The mere presence of the B.S. agenda ensures that those whom B.S.ers wish to plunder will lobby government to keep a bit more of what they have.

This is simply the nature of politics. When it is not about offense, it is about defense. And the more hits in offense a group takes, the more the group will spend in defense.

And by complaining about the rich defending themselves, the B.S.ers are trying to stack the game in their favor. Not only do they think it would be “nice” if other people paid for their college educations and their health care, they think it would be especially nice if those people who pay do not have a say in the “deal.”

How convenient.

Yet they are the ones always talking about “greed”!

This whole approach that they push seems a huge grab from a few to give to the many.

Quite a scheme they got, there.

None of This Is New

Nothing I have written here should strike anyone as in any way novel — except perhaps for a few quips and phrasings. After all, this is a very old debate. As soon as “socialism” became a word on the lips of reformers and revolutionaries, these debates became ubiquitous.

When I was young, the people who pushed the B.S. line were often called “liberals,” but with the rise of Reaganite conservatism, the l-word because a term of opprobrium. The word “progressive” became more popular. When I was younger, I read The Progressive magazine. I have been following this sort of thing all my adult life. But not close enough, apparently, for that magazine still exists. I have not seen it in years.

IMG_4680Indeed, I dropped the rag about the time I helped found Liberty magazine, which was published from Port Townsend until the death of its publisher in 2005. The third issue of Liberty appeared about 30 years ago exactly; the first had hit the mails in July (I think it was) of 1987. Liberty was a libertarian zine, and I had considered myself some sort of a libertarian for less than a decade at the time of its founding. But I had read a great deal of literature in both the individualist and collectivist movements. I had made an informed choice.

Perhaps I was destined to become a libertarian, for my individualism was built into the warp and woof of my psyche. Thinking in terms of groups seemed nuts to me. Indeed, I had interpreted my anti-racism and anti-sexism so big in the decades of my youth as anti-groupthink ethical philosophies. The error of sexism was to judge a person primarily in sex role terms, “by his or her sex” not his or her personhood. What an affront to civility, it seemed to me. And racism? Even less justifiable, for while the differences between men and women, boys and girls, were quite obvious and pronounced on the biological level, and even in psychological terms, the differences among the races were not that large, and from one person to another in any racial category could easily stretch the whole of human diversity.

And yet now the B.S. folks talk relentlessly of groups, of group identity, of one’s personal identity in terms of groups, and of victim groups and groups to be victimized (I mean, “oppressor” groups to be brought down and made “to pay”). Collectivism is alive and well. I have no sympathy for it any more. The whole “thinking in group terms” groupthink strikes me as pure madness.

And why “madness”? Why not use a nicer term? Well, madness is a word we usually use to describe the passionate people who are in some important way unhinged from reality.

The reality I see is that, right now, there are two federal governments: the constitutional government funded by income taxes, corporate taxes, other taxes, tariffs and “fees”; and the extra-constitutional government (consisting of Social Security and Medicare and Medicaid, mainly) funded by FICA and SECA and similar taxes. Interestingly, the unconstitutional government (which I designate as unconstitutional simply because, uh, none of its functions are listed in the Constitution) is basically run on a rough parity, mimic-insurance-contracts “public utility” basis, and what one gets out of the system does indeed depend on what one puts into it. The constitutional part is paid for mostly by the wealthy.

The nature of this tax situation is indeed quite amazing. The B.S.ers often yammer about “making the rich pay their fair share,” but the constitutional government is paid for almost entirely by the rich. This video explains this pretty well:

So when Bernie writes me to warn that current moves by the Republicans are designed to benefit the rich at the expense of “working families,” I am a bit skeptical:

And I’m going on the road again because we have to defeat this bill, too — a tax bill that will slash taxes for the rich, raise taxes on working families, and lay the groundwork for a massive attack on the most vulnerable people in our country.

This bill is an immoral disaster. If it passes, 13 million fewer Americans will be insured, and health care premiums will surge for tens of millions more. Further, the Republican budget cuts Medicaid by $1 trillion over 10 years and Medicare by over $400 billion. In order to give huge tax breaks to billionaires and large corporations, the Republican budget also makes enormous cuts to education, nutrition, affordable housing, and transportation — and will crush college students and college graduates struggling with debt.

In short: This budget will do incalculable harm to tens of millions of working families, women, kids, the sick, the elderly, and the poor. We have to fight this budget and stop it. That’s why I’m hitting the road with MoveOn, and why I’m asking you to support the work that we’re doing.

Then he asks for $3.

Thanks, but no thanks. I will spend $3 on a Coke. Or two. Or three.

Bernie makes no mention of how “rickety” is the current unconstitutional government sector, the Social Security/Medicare/Medicaid division. That is where most of his complaints about cuts are. But if it be unstable, financially unsound, we (if there is a “we” at all here . . . I know I have no power of choice in the matter) have basically two things to do: cut services and/or raise revenues. A normal person would probably suggest doing both, though one could see problems associated with doing either. The consequences of doing nothing? Almost unthinkable, for most people.

The fact that Bernie makes no mention of the problem, just focuses, instead, on the problem he sees with one solution, strikes me as irresponsible. If you want to know why there is such a strong divide, these day, look not merely the rhetoric on both sides, but on what they do not say. Bernie is mum about the secular disorder of the federal government, in which he serves as a prominent leader.

And his solution — make the rich pay more, not less — is even less responsible. He wishes to bail out the unconstitutional system that he himself helped strain (by voting for more benefits in the past) from the constitutional half of government, which already is paid for mainly by the very people he wants to soak further in his bailout.

I just shake my head.

I realize, this rambling blog entry is of little value. I am not really writing to convince anyone of any particular thing. Do I have any hope of convincing the progressives? No. They live in their reality, and its irreality they hope to impose on the rest of us. Meanwhile, we watch the Republicans speak only in half truths, and attempt only half-responsible reforms. I am just venting between jobs. (I have a video project to get to.)

I have never been less hopeful about the political future of the United States than I am right now. And I ascribe most of this to the unwillingness of partisans to deal with reality. Two sides and the middle are caught in a game where not seeing the whole is the most obvious feature.

It looks like the worst sort of game: not win-win; not win-lose; but lose-lose.

twv

 



* The willingness of people to become convinced of governments’ ability to manage the planetary climate while our federal government cannot even balance a budget is so astounding to me that I am, right now, at a loss for words. On that goofy subject.

† One of my readers made an astounding caveat to an earlier expression of mine about the marginal productivity theory of wages, which depended upon what seemed to me like a bizarre misreading of equilibrium theory, and a complete elision of knowledge problems —  but I confess, many of these are beyond my ken.)

IMG_3895

In the wake of the church shooting in which a Christian man, Stephen Willeford, shot a mass murderer after a car chase there has, of course, been much discussed on social media. I have tried not to get involved . . . directly.

So, “indirectly,” there is this: what I would have said on Facebook had I said anything on Facebook. . . .

img_0452Friend:

No matter what you might think on the subject, many Christians pray after a tragedy not because they are virtue signaling, but rather because they are praying for the repose of souls.

It is an act of mercy.

I can’t fathom why this would upset people.

Stranger:

What I’m seeing in this issue is on one hand, people sick and tired of seeing news of another mass shooting, and on the other hand, politicians and other “leaders” sending prayers and thoughts instead of doing their jobs. I understand that you don’t want to get involved in a political debate, but trying to redefine the problem as apolitical only muddies the issue further. You may as well be burying your head in the sand. I really don’t think anyone is bashing the average person of faith who is horrified and wants to help and can’t think of anything better. The criticisms are aimed squarely at theocrats who send thoughts and prayers instead of doing their jobs.

Me:

Politicians “doing their jobs” on this issue have, on a state-by-state and city-by-city basis, seemingly done more harm than good. So, the issue is political, sure, but not in a good way: “the job” to be done may be much harder than anyone thinks.

In politics, it all becomes religion pretty fast. The amount of faith in government as an institution that is shown by earnest people demanding that politicians “do something” or “their jobs” is contra-indicated by facts on the ground.

Reasonable people remain skeptical, and unimpressed with people who turn from prayer to promoting pointless and problematic action.

And as for “thoughts and prayers” — it is just something people say when there is nothing they can really do. Give people a break. Getting angry and expressing it politically is hardly the wisest social reaction — especially to grieving and distraught people. That is the reaction of dangerous fools.

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This post first appeared on Wirkman Netizen, September 16, 2008:

The cure for statism is not more statism. And yet that seems to be the general approach of mainstream government policy.

What drives current government economic policy? Fear. Fear that letting a big institution fail would spiral everything out of control, leading, ineluctably, to chaos.

The problem with this fear-based policy is that it seems to so insulate the market-directed institutions from their normal feedback loops that such policy actually exacerbates the situation, only in a longer cycle. To prevent a near-term disaster, government bolsters up a particular company. Then, perceiving that responsibility has been undermined in the feedback system, market actors behave less responsibly, leading, down the road, to a bigger crisis than would otherwise have occurred.

I am thinking about the automobile industry and the mortgage industry, right now. Other industries provide evidence for this general perspective.

But always you have politicians intervening in the feedback systems, weakening those systems and making matters, in the long run, worse. The Rx in each case seems like only a slightly bigger dose than has gone on before, but its repercussions spread wider with each administration of the “cure.” The system becomes parasitic itself, dependent upon such cures being given at increasing doses and with increasing frequency.

It is not wise medicine. It is fear-based medicine. If people could just get over the fact that companies die just as individuals do, we would not have such nonsense. Indeed, the ruling fear of the day is fear of business death. The funny thing about this fear is that it is so amazingly inegalitarian. Some companies (big companies) are more important than others. Tens of thousands of small businesses die per year. But have one large company go, and politicians of both parties vie to save it, prop it up.

The belief that some companies are more important than others is a classic “pro-business” economic policy model. It is similar to the belief that some taxpayers are more important than others. (Democrats appear to appear to believe the broad wash of consumers are most important for “the economy”; Republicans believe that richer consumers, who invest, are more important.) What is interesting about the theory of company size importance is how bipartisan this theory is.

You can see the reasons for believing the theory. A big company goes down, and a whole bunch of people become unemployed. But you raise the minimum wage, and unemployment goes “unexpectedly” up. You raise taxes on businesses, and unemployment goes up. You increase regulation, and unemployment can go up, too. In all these other cases, though, the employers and employments are more widespread than when one single large business goes down. So, it is a matter of parallax. If you only notice the one kind of bad effect, but not the more common and widespread others, you consistently skew the system.

This sort of policy also increases the advantages that big companies have over small ones. In a freer market, smaller companies often outcompete big companies. But when you start subsidizing big companies when they fail, you basically foster a plutocratic system, since it is often the case that it is the big, wealthier companies who can afford to rent politicians at a rate that crowds out the input of smaller companies. You end up (not surprisingly) with higher concentrations of wealth.

This is rather like what Karl Marx predicted, only not free-market insolvencies in the business cycle spurring the wealth gap, but government doing so.

It is, of course, great for those people who ensconce themselves within the ranks of the big companies. Thus it is and was that Ivy Leaguers and the like keep their positions in society. The Old Boys keep their network, and keep their nodes operating, while, in the freer part of the market, the unsubsidized part, nodes pop in and out of prominence daily.

The policy of preferring big companies over small ones — of giving special treatment to the large in effect at the expense of the small — is an ancient way of conducting the state. It is not new. It is not sophisticated. It is based on systematic illusion and it is at one with how ancient empires were run, how mercantilist kingdoms were run.

It was common practice when leechcraft and bloodletting were all the rage.

It is laissez-faire that is new and sophisticated.

It is time for the advocates of laissez-faire to chuckle and rib the simpletons and their vain policies of favoritism. There is no reason for advocates of dirigisme  to get away with any sort of intellectual high ground, or any cultural pre-eminence. They should be ridiculed in a similar manner that they have ridiculed laissez-faire, for over a century. And for every jibe, offer a bit of reason to show why the high ground is where it is, in freedom’s quarter.

Statecraft is leechcraft not merely for its game of draining the blood of the market order. Statecraft is leechcraft in that it is based on out-moded notions of what makes society healthy. Freedom makes it healthy. Statism cripples it, the better to feed the insatiable demands of partisans of the state.

twv

http://wirkman.net/wordpress/?p=415

Orang malu

N.B. A few alterations of the above post have been made in this re-posting, to fix typos and remove some infelicities of style. No new thoughts have been introduced.

This is just another hastily-made rehash of my basic views of government and society, something I still do on a fairly regular basis; I repost it here mostly because I like the title. And that one of the themes, of long-cycle instability, just does not get enough play in policy discussion. (Though now that Western civilization approaches crisis, this sort of thing is increasing, no?)