We, on the left, are in favour of collective action. The right are against it. Most of them are against it for entirely dishonest reasons – when they call themselves \’principled libertarians\’, you can usually see – beneath the surface – nothing more than a defence of hereditary wealth and ancient power-relations, combined with a determination to co-opt those who manage to naturally-select their way off the lower social tiers.
There is a minor disagreement on the left about how collective action should be directed. The older left tend towards the state, and the newer left (of which I hope I\’m one) tend to prefer it to be organised in a much more dispersed and spontaneously directed way – with strong voluntary, local and regional structures that are capable of taking on and beating more central ones.
Nothing like entirely misrepresenting an argument, is there?
Us "principled libertarians", or perhaps classical liberals is another reasonable description, are all in favour of collective action. No, really, we are. With one and only one proviso. That it is voluntary collective action.
We defend freedom of association just as firmly as we defend freedom of speech, for both are natural rights.
"and the newer left (of which I hope I\’m one) tend to prefer it to be organised in a much more dispersed and spontaneously directed way"
That\’s straight friggin\’ Hayek. What in buggery do you think markets are all about if it isn\’t spontaneous organisation? Why do you think we prefer markets in the first place? That it\’s because they are the only system that allows such spontaneous organisation might be a clue perhaps? The only system that allows (indeed encourages) experimentation with methods of ownership, a point I have repeatedly made at that motherload of "principled libertarianism", the Adam Smith Institute?
Jebus, get a clue people, please. Classical liberals were always of the left (it\’s one of the more bizarre social currents of the latter part of the 20th century that we became seen as of the right) precisely because we really did and do believe that as far as possible, the State (and society, come to that) should bugger off and allow people to trade, associate, get one with things, as they wish. You know, spontaneously.
Never realized you were a leftie Tim.
Tim adds: Very much so: make the poor wealthy, the maximum of personal (both social and economic) freedom consistent with having a society at all, these are classic lefty goals. It’s just that because I argue that these things will be best achieved by markets, by the State buggering off, that no one else thinks I’m a lefty.
This is a classic socialist move though isn’t it – if you want to demonise someone keep repeating the mantra that they are right wing.
In this case because you don’t believe the state is the solution, indeed that it is mostly the problem, you clash with the socialist desire to control our lives through the state and ergo must be a right winger.
I dunno Tim. I’ve often checked back here and it doesn’t seem to be the sort of place that posh people will need to check that they still have their inherited jewellery when they leave.
As far as I can see, most right-wing libertarians seem to exclusively promote the capitalist mode of collective action. The last few weeks have shown us that it is entirely incompatible with representative democracy (because representatives will always be oliged to offer one of those awful safety nets).
So its representative democracy + other modes of collective action OR unregulated capitalism. I know that there are plenty of bloggers who would pick option b, but – outside the blogosphere, I’ve only ever met one person that would make the same choice. And he used to work for the IEA. He was really, really, not a lefty either…..
“most right-wing libertarians seem to exclusively promote the capitalist mode of collective action.”
You can keep juxtaposing the terms as much as you like, but it doesn’t make it correct. (And to do it in the first place is ignorant, to keep doing it when the mistake has been pointed out to you is dishonest rhetoric). Right-wing libertarian is as much an oxymoron as left wing libertrian. A liberatrian generally does not want the state to interfere with their sex life, finacial life, narcotic habbits, diet or any other aspect of their life style – putting them at odds with left and right.
The last few weeks have shown us that it is entirely incompatible with representative democracy
They have?? In what way? If you are referring to the banking collapse caused by the credit crunch, you should perhaps acknowledge that the banks were working in a highly regulated market that was distorted by two players with implicit government backing. Hardly unfettered capitalism.
(By the way, you can deal with your jewellery envy by buying some of your own, you know.)
“So its representative democracy + other modes of collective action OR unregulated capitalism.”
Really? Literally only those two ways of setting up a society? So every society has fitted into one of those two categories? Who knew!
*Inherited* jewellery Stephen,
I’ve not had it ‘pointed out’ to me that right-wing and libertarian are incompatible. I’ve had it asserted to me. That’s different.
Are you suggesting that self-styled “right-wing libertarians (who) seem to exclusively promote the capitalist mode of collective action” are either non-existant or as rare as rocking horse shit?
If so, perhaps a look around will cure you of that.
And I’m not going to get into the old ‘the markets have failed – we need more markets’ argument either. It’s too well trodden, and you would have to conduct a huge and potentially inhumane experiment to prove it. On the other hand, the European model of social democracy – representative democracy + regulated markets – is not an experiment.
It has been tried. It has given participants a good long period of peace and prosperity and a redistribution of inherited wealth, and it looks even more respectable a position than it did a couple of weeks ago.
I think the collective action being referred to is of the “tyranny of the minority/majority” variety, i.e. lefties get together, decide what is best for everyone and enforce it, either through the state or local bullyboy activists. Either way it is contrary to libertarian principles.
Paulie,
Two things.
One: you are confusing *capitalism* – which is a mode of ownership – and *free markets* – which is a mode of exchange. This is an absolutely essential difference and Tim spends much of his life pointing it out.
Two: “the markets have failed – we need more markets”
No: it was *Government Intervention to force people to do things that they would not otherwise do* that failed. So yes, we do need more markets.
The market did not want to lend to the subprime borrowers. But it was *forced* to by the Community Reinvestment Act.
Force is not a trait of markets.
You may counter that markets are not good at lending to people who can’t repay loans and I know that that’s important to your desire for equality of outcome, but that’s not the argument you are advancing.
Oh and whilst we are at it: this is priceless. “Plans don’t work.”
There goes any reason – if there ever was one – for state intervention in markets…
What Cleanthes says.
It’s ‘motherlode’, actually.
Y’see: Paulie slapped again, from all points of the compass. Will it make any difference? Nope.
He’s an obsessive, and a stupid one at that.
DK
“There goes any reason – if there ever was one – for state intervention in markets…”
It also rather buggers up the argument for largish firms of any kind if that’s how you want to interpret that line.
The point I’m making is that the left should be promoting the form of democratic control that works best and then letting those units run things.
Not an argument that all of these new anti-capitalists would be very keen on I expect?
“The point I’m making is that the left should be promoting the form of democratic control that works best and then letting those units run things.”
That would be individuals and families. Never thought that Paulie would admit to being a Thatcherite…
“I’ve not had it ‘pointed out’ to me that right-wing and libertarian are incompatible. I’ve had it asserted to me. That’s different. ”
Well don’t rely on other people’s assertions, use your own skills to find out what the differences are. I would have thought that a regular visitor to this site would be able to see what the difference is between right wing and libertarian is, even if they don’t agree with either position. I don’t agree with lots of positions on the left, I don;t go around pretending that I don’t see any difference between them though.
“Are you suggesting that self-styled “right-wing libertarians (who) seem to exclusively promote the capitalist mode of collective action” are either non-existant or as rare as rocking horse shit? ”
The word seem in the above is doing an awful lot of work.
“And I’m not going to get into the old ‘the markets have failed – we need more markets’ argument either. It’s too well trodden, and you would have to conduct a huge and potentially inhumane experiment to prove it. ”
I am glad you are not going to get into that old argument because the comments above certainly do not consitute a rebuttal of that argument.
“On the other hand, the European model of social democracy – representative democracy + regulated markets – is not an experiment.”
What was that you were saying about assertions? This is the regulation where governments encouraged home ownership – even for those that could not afford it – rather than leaving it to the markets to determine who was a good credit risk and who was not.
“It has been tried. It has given participants a good long period of peace and prosperity ”
Nothing to do with NATO then?
“and a redistribution of inherited wealth, ”
Not just inherited. Someone on 15K a year sees a fair bit of their “wealth” redistributed too. Lucky them.
“and it looks even more respectable a position than it did a couple of weeks ago.”
Not from here.
ChrisM,
“On the other hand, the European model of social democracy – representative democracy + regulated markets – is not an experiment.”
You might also wish to draw Paulie’s attention to continental pension fund deficits. Because if he’s right, this isn’t an experiment – it’s part of the plan.
“It also rather buggers up the argument for largish firms of any kind if that’s how you want to interpret that line.”
No, No, No!! The “argument” for largish firms is that people should be free to asscociate and trade in what ever manner they like and group themelves however they like, large, small, or minute. The efficiancy is neither here nor there, if people want to band together in groups of 100000 for some purpose (eg wealth creation), who or on earth are you to say they should not.
I love it when right wing libertarians (and whatever anyone thinks, that is definately what DK is – someone who went to the most expensive public school in the country and uses it as a platform to defend a future level playing field) proclaims that I’m being ‘slapped’.
Chris, if you follow the thread back, I was criticising right-wing libertarians specifically. That there are other kinds, or soi disant other kinds is a different matter.
There are people who describe themselves as right wing libertarians who do exclusively promote the capitalist mode of production. Plenty of them. There – I’ve stopped the word ‘seem’ working so hard.
As for the rest of it, you guys can keep on asserting that this whole business is because of over-regulation and … oh gawd, I’m losing the will to live.
When a political position has had a very clear message nailed so loudly through it’s forehead as your lot has over the past few weeks, you despair of human reason when a spot of humility doesn’t somehow manage to squeak out a little bit.
“you guys can keep on asserting that this whole business is because of over-regulation”
Its not really helpful to talk about over or under regulation. A market is a collection of institutions and customs; by definition it has rules and is therefore “regulated”. The interesting question is about which regulations are appropriate and which are not.
The source of the current financial crisis is over-valued houses (particularly in the US but also in the UK). A main reason for this is inappropriate regulation and inappropriate government manipulation of the mortgage market.
To look at this crisis and conclude that it deals a killer blow to the case for unregulated markets is both nonsense and untrue. That’s quite an achievement.
“you guys can keep on asserting that this whole business is because of over-regulation ”
Paulie,
This isn’t about regulation. The purpose of regulation is – ostensibly – to prevent irresponsible behaviour. The subprime mortgage problem at the root of all of this arose because banks were forced to be irresponsible.
And the thing that really really irks is that all of this was backed up by the classic leftist ploy of playing the race card.
This legislation was brought in by Carter (Democrat) in 1977 but not really used in anger until strengthened by Clinton (Democrat) in 1995. That is when the rot really started.
Bush (yes that one, Republican) tried in 2003 to warn about the state of mortgage finance, but was blocked by – wait for it – Democrats at every stage.
So, you know what, Paulie, when you say
“When a political position has had a very clear message nailed so loudly through it’s forehead as your lot has over the past few weeks, you despair of human reason when a spot of humility doesn’t somehow manage to squeak out a little bit.” I think of you, the countless millions of people sacrificed on the altar of “progress” and the continuing failure of those on the left to recognise what a shocking failure everything you stand for has always been and will always be.
If you dispute that consider this:
The mortgage lenders were required to issue loans against every basic rule that your wonderful regulation is supposed to prevent.
The only way that this could possibly have happened is because the state compelled others to do things they would not do if they were acting in their own self-interest. That’s why free markets work and state solutions do not.
Shee-eesh! Haven’t you guys ever seen a closeted conservative yearning to be free?
Is this why Repulicans always run up massive budget deficits and Democrats always reduce them?
The most exasperating things about justifications for free-market capitalism is firstly, they’re so inductive: Scratch their advocates and you usually just find another example of a status quo bias. And secondly, that they always ignore the elephant in the room. That huge mistakes will always be made in the confidence that elected politicians will feel obliged to bail them out. A failure to do so will end a political career. That’s how incentives work.
So, if you want to argue for the complete abolition of representative democracy, then go ahead. I’m all ears. And IF you do have the bottle to make that argument, and if the rest of the world were very unlucky and your argument is somehow taken seriously, THEN we are into a massive science experiment.
I, for one, am flabergasted by the overconfidence of so many right wing libertarians about the outcome of that experiment.
“Chris, if you follow the thread back, I was criticising right-wing libertarians specifically.”
There are no right wing libertarians, no left wing libertarians, and most of all, no paternal libertarians.
There are libertarians, then there are people that want to control what other people do in some sphere, to some greater or lesser extent. With the left it tends to be on financial matters, with the right moral matters. Libertarians (this one at least) wish both lots would fuck off and mind their own business ;-).
“That huge mistakes will always be made in the confidence that elected politicians will feel obliged to bail them out. A failure to do so will end a political career. That’s how incentives work.”
That form of moral hazard can easily apply to capitalism, but it’s not a facet of free markets.
I think you’ll find most libertarians disagree with the bailouts, but then that’s because they disagree fundamentally with the – invariably state/govt driven – policies that caused the problem in the first place.
There’s two ways to reduce the amount of money that politicians give away in this – or any other – manner. You can try and put obstacles in the way of the politicians or you can give the politicians less money.
Only the second way is failsafe.
And in the meantime Paulie, would you like to comment on the fact that the subprime debt problem was caused by left-leaning government intervention forcing people to act against their market principles, rather than capitalist greed?
“That huge mistakes will always be made in the confidence that elected politicians will feel obliged to bail them out. A failure to do so will end a political career. That’s how incentives work.”
Hey, if you have a problem with privatised rewards and socialised risk, come sit with us libertarians.
“So, if you want to argue for the complete abolition of representative democracy, then go ahead. I’m all ears. ”
Sorry but this is utter rubbish. Reducing, increasing, or changing regulations in no way entails the abolition of democracy. It is ridiculous to suggest it does.
“And IF you do have the bottle to make that argument, and if the rest of the world were very unlucky and your argument is somehow taken seriously, THEN we are into a massive science experiment.”
Every governement is a “science experiment”. You don’t get to claim your chosen form of government is the default form, and that all others are experiments.
Unfortunately the term ‘liberal’ has been used as a club by right wingers in the US to bash socialists. The term “classical liberal” has nothing to do with socialism.
Tim is right on this point – that the essence of freedom is to allow spontaneity of the people to organize themselves in order to feed, clothe and house themselves through trade of goods, severices and skills in a lightly regulated market. To enforce that organization through government edict is the essence of both socialism and fascism and is, as classical liberals point out, self-defeating and economically perverse.
Paulie: “And secondly, that they always ignore the elephant in the room”
Right now, I can’t think of a phrase more loathesome than ‘the elephant in the room’. You just know whoever said it is a numpty.
“You just know whoever said it is a numpty.”
Or has lost their pachyderm.
The use of ‘numpty’ generally identifies it’s user as a twat in my book Rory.
Paulie, you are such a fucking retard it’s untrue. Not because you refuse to engage with the substantive point, ie legislation such as the Community Reinvestment Act, that it is government action which caused the problem (or at least turned what might have been a problem into a big problem). Ignoring the relevant facts and rattling out authoritarian guff is what lefties are for, after all.
The reason is because you say spastic thing like ‘the elephant in the room’ and your gay reply above.
Rory,
I must disagree:
Iit is entirely because Paulie does not engage with the substantive point that he is a fucking retard.
However, we can at least agree that he is a fucking retard and that his behaviour is extremely irritating.
OK, you one-note almost-non-existent-outside-of-internet-comment-boxes single-explanation for everything bloggertarian tossers, I’ll play then, even though you thick twats don’t understand the point about how the level of regulation that you would advocate is fundamentally incompatible with representative democracy. (Tim gets this, by the way. He argues against representative democracy).
I’m engaging in this argument that – on the basis set out above – that it’s an utterly irrelevant argument unless it’s advocates are prepared to also argue for the removal of politicians from all public policy decisions.
But here goes: This straw that you are grasping at, a piece of legislation that was enacted in the US in the 1970s and downscaled by the Republicans a few years ago has suddenly caused the confidence of the entire banking industry to diminish in each other’s loans.
A few questions:
Why has a piece of legislation that is more than 30 years old suddenly blown up in everyone’s face – four years after it was watered down by a President that was opposed to the spirit of that legislation?
Why didn’t it blow up *before* 2004 when the obligations of the act on the banks were more onerous? Why did a lending bubble arise in the last few years and not before?
Would you say that change in the regulation that allowed lenders to lend to low-income borrowers *outside* of the restrictions imposed by the CRA may have had a great deal to do with this?
Could it be that it happened during a period in which your beloved freebooting capitalists have been allowed to to invent newer, more complex, less productive, more opaque financial products? Products that have, it seems, defrauded the tax-paying public of hundreds of billions of dollars?
Would you say that any of the loans that were too risky were over-leveraged? Oh shit! I remember now! It was those damn socialists that over-leveraged them, wasn’t it? Silly me!
Were the banks that dealt in sub-prime mortgages all subject to the Community Reinvestment Act? Were most of them, even? What % of those loans were entirely made outside the obligations of the CRA? And what % were made mostly outside of those obligations?
Were CRA loans more likely to be foreclosed than non-CRA ones?
Did mortgage firms that were subject to the Community Reinvestment Act make more sub-prime loans than their rivals that weren’t – or fewer? And if they made fewer, I think that even a pair of spastics such as yourselves would be able to concede that … *maybe* – just *maybe* those damn liburuls weren’t the cause of the whole collapse that … er…. we social liberals are having to bail you out of now.
Now say sorry and go and sign this:
http://nevertrustahippy.blogspot.com/2008/09/declaraton-draft-1.html
Dear Tim Worstall
Your point about spontaneous organisation by free markets is a valid one. There is no theoretical reason why socialism could not be organised by free markets in a spontaneous way.
What you have missed is a values problem. As I understand it, libertarians hold that wealth, health and freedom are fundamental values. These are then legally protected to become property and therefore capital in a free market system, which the free market system spontaneously regulates in an optimal way.
Socialists and other groups hold such things as social need, the environment, information and education as fundamental values. For these values to be regulated by a free market, they too must be described by property laws so that they may become capital and be optimally and spontaneously regulated by the free market.
The reason that libertarianism will never produce an optimal system for socialists or these other groups is that libertarians believe they have the right to steal this capital, if they so require, so that they may convert it, if it pleases them, into their own more desirable types of capital. (In this way, it’s also possible to justify taxation in the current system as socialists and other groups reclaiming externalities that liberal marketers have stolen.)
It should also be noted that, for some of these forms of capital, while the free market would regulate things well, the free cooperative would do better, particularly for social capital. The free market and the free cooperative share property rights and price controls in common, but differ in the last assumption that in a free cooperative, people are motivated by a sense of well meaning towards their fellow beings to increase capital as effectively as possible. It is perhaps this point that the extract is describing.
aphenine
Paulie,
I’ll respond on the CRA in due course, but I shall address what *you* consider to be the substantive point – that politicians will always buckle to the demands of popular pressure and that for them not to do so is not compatible with representative democracy.
It’s tosh. If it were true, we would have the death penalty and we wouldn’t be in the EU. Ergo, politicians are quite capable of ignoring popular opinion when it suits them.
You haven’t got a fucking clue what representative democracy is, and how it differs from direct democracy, have you?
You thick retard.
Paulie,
Three things.
1. Representative Democracy.
Here’s what you said: “because representatives will always be oliged to offer one of those awful safety nets”
I dispute this. Either these representatives think that they have to provide a safety net because they think it is the best thing to do or because they are bowing to popular pressure – they have their eyes on the polls.
The first is disputed here heavily. The second has nothing to do with representative democracy. I merely illustrate that representatives are quite happy to do what they think is right in some cases flying in the face of public opinion. They could do this in this case too. In fact, this post is suggesting that that is what they should in fact do.
Either way, I fail to see that you have proved your incompatability.
2. CRA
See this article dated in 2000:
http://www.city-journal.org/html/10_1_the_trillion_dollar.html
It is only because markets work that it has taken this long to surface. A planned system would have collapsed much sooner. They always do.
Indeed, we are finding that it is yet more regulation that is making the problem worse:
http://eureferendum.blogspot.com/2008/10/no-shortage-of-warnings.html
Governments – and regulation in general – cannot respond as fast as markets. If the regulation is wrong, it continues to hurt long after the market would have adjusted.
3. That famed European social model that’s so much better:
http://www.telegraph.co.uk/finance/comment/ambroseevans_pritchard/3118994/Financial-Crisis-So-much-for-tirades-against-American-greed.html
OK. Your point about representative democracy is absolutely right – with one proviso: That the electorate will continually – over a period of decades – select a majority of representatives that will dogmatically apply the kind of autistic untested capitalist libertarianism, regardless of any evidence about how regulated markets are less prone to violent shocks – and that those voters will be committed to your model enough to reassure those representatives that they will be re-elected even though the the impact of those shocks will cause suffering that lasts over a number of years.
There’s no point in arguing with one-note single-explanation-for-everything retards like you. I could write a comment on a bit of paper, and then nail it through the centre of your forehead, and you’d still just refuse to even notice the words written on it.
No representative democracy of any stripe will ever allow markets to go unregulated in the way that you are suggesting. No representative democracy will refuse to provide bail-outs to organisations that pose a systemic risk.
For fux sake, can’t you just do the decent thing and admit that the only way that you can argue for your half-arsed perspective is to argue for the abandonment of representative democracy?
And any time spent reading some bullshit article in the Telegraph about how the European Social Model is not as fair, humane and successful as the alternative on offer in the US is just time that I will never get back.
And – continuing the play-the-man-not-the-ball theme (you gave me a licence, remember, retard?), if you call your blog ‘eureferendum’ you actually have a title that nails your colours to the direct democracy mast.
You are just too thick to argue with.
…………………………………………….tumbleweed
“regardless of any evidence about how regulated markets are less prone to violent shocks”
Repeat after me: the regulation caused the shock. First CRA caused the banks to loan where they didn’t want to. That got the toxic debt into the market. Then the Mark to Market EU regs caused the crash to be much more violent than it might have been otherwise.
“And any time spent reading some bullshit article in the Telegraph … is just time that I will never get back.”
Which roughly translates as “la la la la – I can’t hear you”. I concede to your clearly superior skills of oratory.
We are now finding out that German banks have been much MORE highly leveraged than the UK or US. You may not like it, but it’s true: there’s nothing that the free market can fuck up that state intervention cannot make immeasurably worse.
You are just too stubborn to argue with.
“….the regulation caused the shock.”
Religious fruitcake.