What is free-market capitalism? Allan Meltzer, an economist at Carnegie Mellon, a Hoover Institution scholar, and onetime advisor to President Ronald Reagan, offers a classic definition. “As long as you engage in actions where your actions don’t impinge upon other people, you’re free to buy and sell anything you want,” he says, adding that free-market capitalism protects private property. Thomas Coleman, a hedge-fund veteran heading up an economic-policy shop at the University of Chicago, adds another key element: free-market capitalism functions best when people and companies can trade “without systemic distortion of prices.” Deirdre McCloskey, until last year a professor at the University of Illinois, and author of the recent book Bourgeois Equality, says, “I don’t like calling it capitalism, anyway, which was a word invented by our enemies. … I call it instead market-tested betterment, innov-ism. … That’s what’s made us rich.” McCloskey says that the heart of “betterment” is Adam Smith’s ideal of “every man to pursue his own interest in his own way” — and that “doesn’t mean a large government sector,” she emphasizes.
Free-market capitalism isn’t the same thing as radical libertarianism. Stan Veuger, an American Enterprise Institute scholar and economics lecturer at Harvard, dismisses what he calls “the anarcho-capitalist ideal”: an economy with no regulations and zero taxation. “There are places like Somalia that score well” on such purist definitions of free markets, he points out. To work well, capitalism needs “an environment where people can concentrate on being productive,” rather than, say, having private armies to assure personal safety. Free-market capitalism requires laws and rules, more than ever, now that more people live in close proximity in dense cities than ever before. Human activity leads to disputes, and disputes can be solved, or at least moderated, by resolutions that govern behavior. We often forget that markets don’t make broad public-policy decisions; governments do. Markets allocate resources under a particular policy regime, and they can provide feedback on whether policies are working. If a city, say, restricts building height to preserve sunlight in a public park, free-market actors will take the restricted supply into account, raising building prices. This doesn’t mean that the city made the wrong decision; it means that the city’s voters will risk higher housing prices in order to preserve access to sunlight. By contrast, a city that restricts housing supply and restricts prices via rent regulation is thwarting market signals — it takes an action and then suppresses the direct consequences of that action.
Nicole Gelinas, “Fake Capitalism: It’s not free markets that have failed us but government distortion of them”, City Journal, 2016-11-06.
September 14, 2018
QotD: Free market capitalism
August 15, 2018
Robert Heinlein – Highs and Lows – #2
Extra Credits
Published on 14 Aug 2018Heinlein’s novels made science fiction mainstream and even contributed to modern libertarianism. His novels vary widely in the philosophies they explore, but ultimately they all reflect how Heinlein saw himself: as the self-reliant “competent man” protagonist of his stories, despite glaring inconsistencies.
August 9, 2018
Robert Heinlein – Rise – Extra Sci Fi – #1
Extra Credits
Published on 7 Aug 2018Before we delve into Robert Heinlein’s famous works, let’s look at an overview of his writing career and the philosophical ideals he was known for: particularly his libertarian worldview, although even this is still hotly debated.
July 10, 2018
QotD: Epicurean philosophy
Epicurus was born in 341 B.C., only six years after Plato’s death. He was 18 when Alexander the Great died. This event conventionally separates the classical Greece of independent city-states from the Hellenistic period, when Alexander’s generals and their dynasties ruled vast kingdoms in the former Persian Empire. He set up his school in a Garden in the outskirt of Athens. There is very little that survived from his many books. But fortunately, the work of his Roman disciple Lucretius, who lived in the first century B.C., De Rerum Natura, or On the Nature of Things, was rediscovered in the 15th century.
Through this work, Epicureanism had a major influence on the development of science in the following centuries. Epicurus had borrowed and refined the atomic hypothesis of earlier philosophers, and De Rerum Natura was studied and discussed by most scientists and philosophers of the West. The physics of Epicureanism, which explains that worlds spontaneously emerge from the interaction of millions of tiny particles, still looks amazingly modern. It is the only scientific view coming out of the Ancient World that one can still read today and find relevant.
Those influenced by Epicureanism include Hobbes, Mandeville, Hume, Locke, Smith, and many of the British moralists up to the 19th century. They not only discussed the Atomic theory, but Epicurean ethics, his views on the origin of society, on religion, his evolutionary account of life, and other aspects of his philosophy.
To me, Epicureanism is the closest thing to a libertarian philosophy that you can find in Antiquity. Plato, Aristotle, the Stoics, were all statists to various degrees, glorified political involvement, and devised political programs for their audiences of rich and well-connected aristocrats. Epicurus focused on the individual search for happiness, counselled not to get involved in politics because of the personal trouble it brings, and thought that politics was irrelevant. His school included women and slaves. He had no political program to offer and one can find no concept of collective virtues or order or justice in his teachings. On the contrary, the search for happiness implied that individuals should be as free as possible to plan their lives. To him, as one of his sayings goes “natural justice is a pledge guaranteeing mutual advantage, to prevent one from harming others and to keep oneself from being harmed.”
Martin Masse, “The Epicurean roots of some classical liberal and Misesian concepts“, speaking at the Austrian Scholars Conference, Auburn Alabama, 2005-03-18.
June 11, 2018
L. Neil Smith on the Koch brothers and the libertarian movement
In the latest issue of the Libertarian Enterprise, L. Neil Smith discusses his experiences working with the Koch brothers:
It says here that David Koch is retiring. In case you don’t know, he is the younger of two oil billionaire brothers associated with the libertarian movement who bankrolled the Cato Institute, and whom “progressives” love to hate, automatically blaming them for what little they don’t blame Donald Trump for.
Genuine libertarians and conservatives don’t like them much, either, for a variety of reasons. My own first is that I served on the 1977 Libertarian Party National Platform Committee with Charlie, David’s older brother and found him to be a timid, unimaginative soul, more concerned with credibility and respectability than with truth or principle. At the time, the think-tank he and his brother created was attempting to turn the LP into a wholly-owned subsidiary (David ran in 1980 for Vice President with Ed Clark), and I didn’t like that, either.
The Koch brothers are also open-borderists, siding with establishment Republicans like that smirk-weasel Paul Ryan who want an imported servant-class they can abuse. I’ve changed my mind on that issue for good and sufficient reasons, and they ought to be good and sufficient for the Koch Brothers, too, if they were really libertarians. American culture is unique and wonderful; I do not want to see it changed or destroyed as the cultures of Sweden and England are being, by uncontrolled mass immigration. Letting a lot of Third Worlders into the United States of America is like letting a lot of Californians into Colorado. Pretty soon it’ll be just like the mess they made and left behind.
We have a saying here: “Don’t Californicate Colorado”.
David is retiring, it says here, due to an extremely long bout with prostate cancer. It does not say what his prognosis is. My own father, whom I miss every day, fought prostate cancer for six ghastly years and died. I’m sorry David has it now; I would not wish that fate on anybody.
But the reason I’m writing this is to speak the truth, to a great big pile of money, if not to power. The Kochs don’t have power because they don’t have a clue how to spend money politically, and, among other counter-productive follies, they threw their dough away with all four hands, supporting a think-tank incapable of reaching the people by the millions the way Donald Trump has. I have never known anyone who read a paper produced by the Cato Institute or listened to a lecture given by one of their wonks — except other wonks.
June 3, 2018
“[Libertarians] are the great optimists of the world”
At Catallaxy Files, Australian senator David Leyonhjelm has a guest post, covering the contents of his maiden speech:
When I became the first overt libertarian to be elected to the Australian Senate in 2013, I thought I would use my maiden speech to try and sum up my world view. In this speech, I outlined why I believe the role of governments should be limited to the protection of life, liberty and private property. I tried to highlight the importance of personal responsibility, the dangers of creeping government interference, and the fundamental right to be left alone so long as we’re not harming anyone else.
If I were to give an elevator spiel to someone who wanted to know more about libertarianism, I’d simply tell them that “a libertarian believes you should be able to keep more of your stuff and be left the hell alone”. It sounds too simple to work, but it does, and that’s what is truly great about it.
When you look at nations that slash government red tape, protect private property rights and safeguard civil liberties, you see societies where opportunity abounds, people escape from poverty, and civil society flourishes.
In fact, these policies have done more to lift people out of poverty than any government program anywhere. Free markets and free trade are responsible for one of the most remarkable achievements in human history: from 35% of the world’s population living on US$1.90 or less in 1990 to 10.7% in 2013, according to the World Bank.
As I see it, those who believe in a limited role for governments and the promotion of personal freedom, aka libertarians, are the great optimists of the world. An optimist would never dream of dictating how and when someone else should do something unless it was to prevent harm to another person. An optimist would never look at someone more successful and seek to grab some of their income or wealth. An optimist would never want to see more restrictions on our everyday lives.
Conversely, people who seek to control others, to take more of their earnings, and to redistribute it according to their values, tend to have a pessimistic view. Only a pessimist could look at society and think, we need more control over the daily lives of others. Only a pessimist would think their better off neighbours should be taxed more heavily or that their hard earned should be used on even more government programs.
A lot of the people who fall on the left side of Australian politics will probably decry the fact that I think they’re pessimists. They’ll say they’re the ones with a true and caring heart, and that redistributing wealth is a lofty goal because it helps those in need. This is demonstrably false, as all the evidence shows, but I will happily admit that such people have a heart, if not brains. The old saying, “if you’re not a socialist at 20 you have no heart, but if you’re still a socialist at 40 you have no brains”, still explains a lot.
May 25, 2018
Leaving the Left – Part 3: Penn Jillette
Economics in the Media
Published on 17 Jun 2016New series on Economics in the Media
It recently occurred to me that many thinking people were once on the political left, but I could not recall having ever heard of someone starting out as a thinking person and subsequently moving to the left.
In this new series we explore some of the people who escaped the left and how they did it.
Original Video:
Penn Jillette at the Cato Institute Benefactor Summit
May 7, 2018
April 12, 2018
Alex Tabarrok profiled in the Washington Monthly
Alex Tabarrok is a friend-of-a-friend (does that make us “friends once removed”?) I’ve read lots of his blog posts and watched many of his videos, but I’ve never actually met him in real life, so this profile was quite interesting:
Tabarrok came by his libertarianism early. When he was growing up in Toronto, his family would debate political and ethical issues over dinner every night. One evening the Tabarroks were debating the moral value of rock and roll. “I said, ‘Well, look at this band, Rush: they even quote this philosopher Ayn Rand in their songs,’ ” he recalled recently. “My mother said, ‘Oh yeah, you’d probably like her,’ and I felt embarrassed because I was using this in an argument and I actually hadn’t read any Ayn Rand before.” Tabarrok thinks his mother probably regrets her suggestion to this day.
Tabarrok made his way to the U.S. for graduate studies at George Mason, returning there as a professor in 2002. He now directs its Center for Study of Public Choice and is the economics chair at GMU’s Mercatus Center, a research institute heavily funded by Charles Koch and cofounded by Richard Fink, a former Koch Industries executive. The center, which boasts ties to prominent right-wing groups like the American Legislative Exchange Council, funds research to promote free-market policy solutions and the rollback of regulations. (Mercatus is Latin for “market.”) The Wall Street Journal has called Mercatus “the most important think tank you’ve never heard of.”
A few years ago, Tabarrok got a new toy to play with. Until recently, there was never great data available for researchers who wanted to empirically study the effects of regulation. But, in 2014, two other Mercatus Center research fellows developed a new public-use database called RegData, which captures everything published in the Code of Federal Regulations each year. Measuring regulation has always been surprisingly tricky, because when an agency puts out a rule, it can contain any number of new individual legal requirements. RegData addresses that problem by scrubbing the Code for key words such as “shall,” “required,” and “may not.” The theory is that this more accurately measures the number of regulations than simply counting the total number of pages in the Code, as past studies tended to do. RegData also uses artificial intelligence techniques to predict which industry each regulation will affect. The upshot is that, for the first time, economists could more confidently measure federal regulations over time and by industry. In theory, that would make it easier to build the case that regulations were hurting the economy.
March 22, 2018
Libertarian Dad Jokes
ReasonTV
Published on 21 Mar 2018In homage to Dad Joke videos everywhere, Reason‘s Andrew Heaton and Austin Bragg try their hand at one-liners, cornball punchlines, and “comedy.”
Written and produced by Austin Bragg, Meredith Bragg, and Andrew Heaton. Shot and edited by Bragg and Bragg. Starring Andrew Heaton and Austin Bragg.
Music: “Quirky Dog” by Kevin MacLeod
March 3, 2018
5 Great Libertarian Movies!
ReasonTV
Published on 2 Mar 2018Forget the Oscars! Here are five great movies made over the past quarter-century that any libertarian will (must?) enjoy.
_____The Incredibles (2004)
This Pixar film directed by Brad Bird is so full of speeches extolling individualism, it sometimes sounds like an Ayn Rand novel (in fact, Rand is clearly part of inspiration for the character of Edna Bird). Even the supervillain in The Incredibles is a creature of self-invention and self-improvement. While the Incredibles are born with their powers, Syndrome is a normie who worships Mr. Incredible and is desperate to be his sidekick.
Like an animated version of Richard Nixon, Syndrome’s ambition ultimately gets the best of him.
The Barbarian Invasions (2003)
Québécois director Denys Arcand’s brilliant sequel to The Decline of the American Empire is the single-best depiction of the depredations of socialized medicine. Canada’s health-care system is so sclerotic that the movie’s protagonist, a retired academic named Rémy, cannot even score the drugs he needs to commit suicide until his estranged son, a banker, buys them on the black market.
Even more disturbing is the moment when the terminally ill Rémy and his former colleagues admit that their intellectual faddishness led them to embrace every awful left-wing “ism” of the past 30 years despite their massive human toll.
Dallas Buyers Club (2013)
Set in the 1980s, Matthew McConaughey plays Ron Woodroof, a boozey roughneck who is given 30 days to live after being diagnosed with AIDS. Faced with a death sentence, he schools himself on a wide variety of treatments, first in Mexico and then all over the world. With the help of a cross-dressing party girl named Rayon, Woodroof skirts FDA prohibitions against importing, using, and selling unapproved drugs by creating a “buyers club,” in which members pay a monthly fee and assume all risks.
The depiction of official indifference to patient suffering and the bureaucratic quashing of medical freedom even for people who are certain to die is inspirational, especially now that even Donald Trump has endorsed “right-to-try” legislation that would allow terminally ill patients access to non-approved medicines.
Joy (2015)
Jennifer Lawrence became a mega-star playing the anti-government rebel Katniss Everdeen in The Hunger Games movies. While there’s no shortage of libertarian sentiment coursing through that trilogy, it’s actually a quieter movie starring Lawrence that embodies libertarian virtues of hard work, commercial innovation, and entrepreneurship.
In Joy, Lawrence plays real-life “Miracle Mop” inventor Joy Magano, who helped make cleaning your floors easier while making herself rich. The film is nothing less than a paean to capitalism’s genius at allowing self-expression and self-fulfillment.
In a dramatic scene with Bradley Cooper, who plays an executive at a home-shopping network, Joy summarizes in a few sentences what it took Joseph Schumpeter, Friedrich Hayek, and Milton Friedman whole books to say.
As former Reason Editor Virginia Postrel wrote, the film “acknowledges the wealth-creating value of incremental improvements even in the most mundane items.”
Ghostbusters (1984)
Released in 1984, Ghostbusters quickly became one of most successful comedies in film history.
The movie was perfectly in synch with the Reagan Revolution’s valorization of business and demonization of government. Ghostbusters begins with a team of paranormal investigators getting kicked out of Columbia University and starting a ghost-hunting business. But even though New York is literally being invaded by evil spirits, the real villain of the movie is not the otherwordly demon Gozer but an Environmental Protection Agency bureaucrat named Walter Peck, who shuts down their operation and puts the city at risk.
Well, what do you think? How far off the mark are we? What great libertarian movies would you add to the list? Let us know in the comments.
Produced by Todd Krainin. Written and narrated by Nick Gillespie.
February 23, 2018
Timothy Sandefur’s Frederick Douglass: Self-Made Man
Jonathan Bean responds to a negative review of Sandefur’s new biography in the New York Times:
Frederick Douglass, whose bicentennial birthday fell on Valentine’s Day, is one of the great figures in American history, a hero whose legacy is celebrated even by those who might otherwise contest his actual ideas.
Illustrating this truth, the New York Times marked the occasion by publishing a largely negative review of Timothy Sandefur’s new biography, Frederick Douglass: Self-Made Man — a book that depicts the African-American ex-slave and social reformer as a classical liberal who championed individual liberty based upon natural rights, self-reliance, and Rule of Law.
The book reviewer, Yale University historian David W. Blight, criticizes Sandefur and other “conservatives” for “co-opting” Douglass. (Sandefur is a self-described libertarian, but in Blight’s mind, ‘libertarian’ and ‘conservative’ are distinctions without a difference.) In making this complaint, Blight demonstrates his confusion as to the meaning of “the Right” and classical liberalism.
Blight concedes that Douglass was a “radical thinker and a proponent of classic 19th-century political liberalism” who “loved the Declaration of Independence” and “the natural-rights tradition.” On these issues, Blight’s view is consistent with Sandefur’s libertarian interpretation of Douglass.
Yet, Blight goes on to protest that the libertarians (or conservatives — he conflates the two groups) are wrong to co-opt Douglass because the great abolitionist “believed that freedom was safe only with the state and under law.”
But this view of freedom’s security is not one that libertarians would dispute. To say otherwise is to make a classic straw man argument.
[…]
Blight’s review gets two things about political classification especially wrong. First, classical liberalism is neither Left nor Right. Throughout history, classical liberals have extolled “unalienable Rights,” individual freedom from government control, the U.S. Constitution as a guarantor of freedom, color-blind law, and capitalism. These values distinguish classical liberalism from left-wing liberalism, with its emphasis on group rights, equality of outcomes, and hostility to free-market capitalism. They also put classical liberals squarely in opposition to nativists and white supremacists who used the law as a weapon to exclude “undesirable” immigrants or separate the races in the American South.
Second, “libertarianism” — the modern descendant of classical liberalism — is not and never has been a “do-nothing” philosophy. Classic liberals (or libertarians) were activists for abolishing slavery, eradicating segregation, defending immigrants’ rights, passing anti-lynching measures, and much more. Indeed, although they recognized the role that law played in protecting the exercise of liberty, it was the law that so often violated the inalienable rights of Americans. Classical liberals fought slavery, segregation, pernicious immigration quotas, internment, and “affirmative action” because these government measures denied individuals equal protection of the law.
Blight’s conceptual errors may account for why he sometimes badly misreads his subject. He claims, for example, that Douglass loved “the reinvented Constitution — the one rewritten in Washington during Reconstruction, not the one created in Philadelphia in 1789.” This is a gross mischaracterization of Douglass’s views.
February 6, 2018
February 2, 2018
Trump Diminishes the Power of the State in Our Heads: Wired Co-Founder Louis Rossetto
ReasonTV
Published on 1 Feb 2018Louis Rossetto, co-founder of Wired magazine, on politics, the dot-com bubble, and his new novel, Change Is Good: A Story of the Heroic Era of the Internet.
—————-
“Trump is a refreshing reminder that the guy that’s in the White House is another human being,” says Louis Rossetto, the co-founder of Wired and author of the new book Change Is Good: A Story of the Heroic Era of the Internet. “The power of the state is way too exalted [and] bringing that power back to human scale is an important part of what needs to be done to correct the insanity that’s been going on in the post-war era.”In 2013, Rossetto was the co-recipient of Reason‘s very first Lanny Friedlander Prize, an award named after the magazine’s founder that’s handed out annually to an individual or group who has created a publication, medium, or distribution platform that vastly expands human freedom. Rossetto is also a longtime libertarian who knew Friedlander personally.
While still an undergraduate at Columbia University, Rossetto co-authored a 1971 cover story in the New York Times Magazine titled “The New Right Credo — Libertarianism,” writing that “[l]iberalism, conservatism, and leftist radicalism are all bankrupt philosophies,” and “refugees from the Old Right, the Old Left and the New Left, they are organizing independently under the New Right banner of libertarianism.”
Reason‘s Nick Gillespie sat down with Rossetto to talk about his new book (the paper version was lavishly designed and crowdfunded on Kickstarter), the 1990s tech boom, and why Trump “diminishes the power of the state” in our heads.
Interview by Nick Gillespie. Edited by Ian Keyser. Cameras by Paul Detrick, Justin Monticello, Zach Weissmueller.
Machinery by Kai Engel is used under a Creative Commons license.
Photo Credits: Chris Kleponis/ZUMA Press/Newscom – Jonathan Ernst/Reuters/Newscom – Abaca Press/Douliery Olivier/Abaca/Sipa USA/Newscom
January 30, 2018
“Libertarian brutalists” … yet another name for the alt-right
At Catallaxy Files, Jeffrey Tucker identifies two very different kinds of libertarian:
Why should we favor human liberty over a social order ruled by power? In providing the answer, I would suggest that libertarians can generally be divided into two camps: humanitarians and brutalists.
The humanitarians are drawn to reasons such as the following. Liberty allows peaceful human cooperation. It inspires the creative service of others. It keeps violence at bay. It allows for capital formation and prosperity. It protects human rights of all against invasion. It allows human associations of all sorts to flourish on their own terms. It socializes people with rewards toward getting along rather than tearing each other apart, and leads to a world in which people are valued as ends in themselves rather than fodder in the central plan.
We know all of this from history and experience. These are all great reasons to love liberty.
But they are not the only reasons that people support liberty. There is a segment of the population of self-described libertarians — described here as brutalists — who find all the above rather boring, broad, and excessively humanitarian. To them, what’s impressive about liberty is that it allows people to assert their individual preferences, to form homogeneous tribes, to work out their biases in action, to ostracize people based on “politically incorrect” standards, to hate to their heart’s content so long as no violence is used as a means, to shout down people based on their demographics or political opinions, to be openly racist and sexist, to exclude and isolate and be generally malcontented with modernity, and to reject civil standards of values and etiquette in favor of antisocial norms.
These two impulses are radically different. The first values the social peace that emerges from freedom, while the second values the freedom to reject cooperation in favor of gut-level prejudice. The first wants to reduce the role of power and privilege in the world, while the second wants the freedom to assert power and privilege within the strict confines of private property rights and the freedom to disassociate.
To be sure, liberty does allow both the humanitarian and the brutalist perspective, as implausible as that might seem. Liberty is large and expansive and asserts no particular social end as the one and only way. Within the framework of liberty, there is the freedom to love and to hate. At the same time, they constitute very different ways of looking at the world — one liberal in the classical sense and one illiberal in every sense — and it is good to consider that before you, as a libertarian, find yourself allied with people who are missing the main point of the liberal idea.
In my experience, most of the people who espouse these “brutalist” notions are not people who have ever identified as libertarians.
