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Markets Are Breaking Down India’s Caste System, Turning Untouchables into Millionaires – Article by Malavika Nair and G. P. Manish

Markets Are Breaking Down India’s Caste System, Turning Untouchables into Millionaires – Article by Malavika Nair and G. P. Manish

The New Renaissance HatMalavika Nair and G. P. Manish
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This year marks the 25th anniversary of liberal reforms in India that led to the dismantling of many socialist economic policies and the end of the draconian License Raj. Liberalization has changed life for many in India over the past couple of decades, although much more remains to be done. Just the middle class alone has exploded from 30 million people in 1991 to 300 million in 2014.

So this is a good occasion to tell the story of perhaps the most unexpected beneficiaries of these reforms: the rising Dalit millionaires. In recent years, many thousands of so-called “untouchables,” or Dalits, members of the lowest group in the Indian caste order, have risen out of poverty to become wealthy business owners, some even millionaires.

By taking advantage of the greater economic opportunity brought about by market reforms, these Dalit entrepreneurs provide us with an important example of the power of markets, not just to bring about economic emancipation, but to fight deeply entrenched social discrimination.

The Plight of the Dalits

The Indian caste system is an ancient and complex social order that divides society into groups based on a somewhat rough division of labor. The Dalits belong to the lowest group, below the four-tiered hierarchy of priests, warriors, merchants and artisans. Traditionally, Dalits were relegated to a life of doing “dirty” jobs such as cleaning floors and toilets or handling garbage: hence gaining the name “untouchable” as others would refuse to come into contact with them.

Since one’s caste was determined by birth, and it was impossible to switch castes throughout one’s life, being born an untouchable meant a lifetime of being trapped in a low income “dirty” job with very low social status. Marriages would only take place among caste members, and hence one’s children would be faced with the same hurdles brought by the untouchable identity, leading to systematic discrimination locked into place for generations.

It isn’t surprising that the Dalits consistently rank near the bottom of poverty statistics in an already poverty-ridden country. The term “poorest of the poor” would be an apt description of their socio-economic status in general. For decades, this made them the targets of several affirmative-action programs as well as many a politician looking to champion a cause.

While affirmative action has helped some get ahead, it has by no means been a panacea. For as long as all industry was state-controlled and subject to extensive licensing, the state effectively made all production decisions and awarded licenses to a few chosen oligarchs. This meant that opportunities for entrepreneurship and business were slim to none, and affirmative-action programs only served to redistribute pieces of a fixed pie from one to another.

Slumdog Millionaires

But there is a new heartwarming trend of entrepreneurship and self-help among Dalits since the liberal reforms in India, especially in urban areas. A visit to the Dalit Chamber of Commerce website (see also the Facebook page) reveals slogans such as “Fight Caste with Capital” and “Be Job givers, not Job seekers” as well as a spokesperson who favorably cites the invisible hand, a la Adam Smith! This voluntary Chamber of Commerce, set up in 2003 to bring Dalit entrepreneurs together, currently has 5,000 members whose enterprises jointly boast over half a billion dollars in sales revenue. The actual number of entrepreneurs in the population is much higher.

To what do they owe their success? Fascinating new qualitative research that tracks the life stories of several of these Dalit entrepreneurs reveals a common thread. The opening up of production processes to market forces created new opportunities like never before. Starting small and scraping together resources and capital, many of these Dalits now run business empires that actually provide employment to upper caste members.

There is Thomas Barnabas who was born into a family of bonded laborers, all eight of whom lived in a one-room house. Thomas recalls being thrown out of an upper caste friend’s home as a child after eating and drinking there because he was “untouchable.” They then proceeded to purify and wash the floor where he sat and threw away the dishes from which he ate.

Thomas now owns an industrial waste recycling and disposal business that has an annual sales revenue of $2.3 million and employs 200 people (including many upper caste members) outside the city of Chennai. He strove to fulfill an unmet demand for the processing of industrial waste generated by large corporations like Samsung, Dell, and Mercedes that set up manufacturing facilities in India after liberalization.

Or there is M.M. Rao, who was just one of two children to get an education in a family of bonded laborers with eight children. His family was so poor that they could not afford to buy shoes. His mother and sister were forced to walk barefoot to work in a nearby town.

Rao now owns a group of companies that specialize in construction, especially in the telecom sector, with a sales revenue of $7.4 million in 2010 alone. He was able to use his education as a civil engineer to start a small sub-contracting business laying telephone cables for large companies after the liberalization of the telecom sector. Owing to the quality of his work as well as his business acumen, he was able to grow that small sub-contracting business into what it is today.

Sushil Patil grew up in a 200-square-foot house in a slum, and his father was a laborer in a factory where he was discriminated against for his low caste status. Sushil was able to complete his engineering degree only because his father had to request the college dean to waive the fees that they could not afford to pay. He recalls, “I can never forget my father bowing before the dean, that hit me hard.” He now owns a construction and engineering company with revenues of $45 million a year. His main business is to handle the construction of power plants for major power companies. He has friends who still live in the slum that he grew up in and hopes to construct a charitable hospital that will offer medical services free of charge to the poor.

Markets Break Down Barriers

These stories constitute but a tiny sliver of many thousands, if not more. They lead us to an interesting question: how is it exactly that markets fight social discrimination? Markets work in very different ways than the obvious and visible hand of state-driven policies. While the state seeks to outlaw and abolish caste identity by making discrimination illegal, markets work in quiet and invisible ways by making caste identity irrelevant.

Competition brings about the existence of meaningful and relevant alternatives that raise the opportunity cost of discrimination for everyone participating in the market. It is in an entrepreneur’s economic interest to hire and contract with those who have the highest marginal productivity regardless of their caste identity. For if he does not, his competitor might potentially steal away profits that he could have earned. The more open and competitive a market, the more true this holds.

Once liberal reforms were put in place, they created choice and opportunity for many like never before. Market forces unwittingly brought about economic and thus social progress for society’s poorest and most discriminated against.

But can we go as far as saying the caste system has withered away? Not at all. It is unfortunately alive and well, especially in the rural areas where 68% of the population still lives, despite its being legally “outlawed” for decades.

Can we say that discrimination melts away in a market setting? Not necessarily. Anyone is free to discriminate on the basis of caste identity, even in a market. However, the greater the economic opportunity out there, the greater the chance that the cost of discrimination will be borne by the discriminator himself, not the one being discriminated against.

This is not true under socialism. When the state has a monopoly over all production and its chosen oligarchs (employers) sell to a captive market, discriminating against a certain group of people does not have negative economic consequences for the employer, but only for the ones being discriminated against. Naysayers claim that this rise among Dalits is marginal and not representative of Dalits as a proportion to the total population of the country. Some are getting ahead, but most are still left behind.

While this may be true in terms of numbers, the fact that this has happened at all is nothing short of marvelous. It’s not a coincidence that there were no Dalit millionaires emerging under socialism. It is a direct consequence of the underlying institutional setting. The Dalits exemplify the theory of the so-called poverty trap: being locked into a low-income equilibrium for generations. And yet, given a little opportunity and choice, we see many leaving a life of poverty and social discrimination behind to become well-respected business leaders and philanthropists.

Most encouraging is the recognition among them that it is the invisible hand of the market that has been instrumental for social and economic progress in their community. It is a step in the right direction for the future of classical liberalism and its role in alleviating poverty at a time when many who are more fortunate seem to be forgetting or ignoring its importance.

References

  1. The unexpected rise of Dalit millionaires: Swaminathan Aiyar
  2. Capitalism is changing caste much faster than any human being: Shekhar Gupta
  3. Defying the odds: The Rise of Dalit Entrepreneurs: Devesh Kapur, D Shyam Babu, Chandra Bhan Prasad
  4. Capitalism’s Assault on the Indian caste system: Swaminathan Aiyar, Cato policy paper
  5. 5. Dalit Chamber of Commerce website: www.dicci.org.

Malavika Nair is an Assistant Professor of Economics in the Johnson Center for Political Economy at Troy University. She is also an associated scholar of the Ludwig von Mises Institute.

G.P. Manish is an Assistant Professor of Economics in the Sorrell College of Business and a member of the Manuel H. Johnson Center of Political Economy at Troy University.

This article was published by The Foundation for Economic Education and may be freely distributed, subject to a Creative Commons Attribution 4.0 International License, which requires that credit be given to the authors.

The Strengths and Weaknesses of “Atlas Shrugged: Part III” – Video by G. Stolyarov II

The Strengths and Weaknesses of “Atlas Shrugged: Part III” – Video by G. Stolyarov II

The New Renaissance Hat
G. Stolyarov II
September 16, 2014
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Mr. Stolyarov reviews the final installment in the “Atlas Shrugged” film trilogy.

Although Mr. Stolyarov favorably reviewed the first two installments, in his view the third film fails to do full justice to the culmination of Ayn Rand’s magnum opus, where one would expect to witness the coalescence into an integrated worldview of all of the philosophical and plot pieces that Rand meticulously introduced during the first two parts. Atlas Shrugged: Part III is not without its merits, and it is inspiring in certain respects – especially in its conveyance of Rand’s passionate defense of the creator-individualist. However, the film is also not a great one, and the creators could have made Rand’s source material shine consistently instead of glowing dimly while occasionally emitting a bright flicker.

References

– “The Accomplishments of ‘Atlas Shrugged: Part I’” – Article by G. Stolyarov II
– “Rejecting the Purveyors of Pull: The Lessons of ‘Atlas Shrugged: Part II‘” – Article by G. Stolyarov II
– “The Strengths and Weaknesses of ‘Atlas Shrugged: Part III’” – Article by G. Stolyarov II

The Strengths and Weaknesses of “Atlas Shrugged: Part III” – Article by G. Stolyarov II

The Strengths and Weaknesses of “Atlas Shrugged: Part III” – Article by G. Stolyarov II

The New Renaissance Hat
G. Stolyarov II
September 13, 2014
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In my reviews of Part I and Part II of the Atlas Shrugged film trilogy, I expressed largely favorable reactions to those films’ message and execution. Naturally, I was eager to see Part III and the completion of the long-awaited Atlas Shrugged trilogy. After I watched it, though, my response to this conclusion is more muted. The film fails to do full justice to the culmination of Ayn Rand’s magnum opus, where one would expect to witness the coalescence into an integrated worldview of all of the philosophical and plot pieces that Rand meticulously introduced during the first two parts. Atlas Shrugged: Part III is not without its merits, and it is inspiring in certain respects – especially in its conveyance of Rand’s passionate defense of the creator-individualist. However, the film is also not a great one, and the creators could have made Rand’s source material shine consistently instead of glowing dimly while occasionally emitting a bright flicker.

Strength 1: There is now a complete film series spanning the entire story arc of Atlas Shrugged. What Ayn Rand herself and many successive filmmakers could not achieve, producers Harmon Kaslow and John Aglialoro have been able to bring into existence. For decades, admirers of Ayn Rand’s work have lamented that no Atlas Shrugged movie had been made. The fact that this particular lament is obsolete constitutes major progress for Objectivism (where the rate of progress is admittedly extremely slow).

Weakness 1: Part III is, in my view, the most poorly executed of the three Atlas Shrugged movies, even though it had the potential to be the best. The extreme brevity of Part III – a mere 90 minutes, compared to 102 minutes for Part I and 112 minutes for Part II – orphaned many of the events of the film from their contexts, as compared to the meticulous rationale for each of Ayn Rand’s decisions in the novel. John Galt’s speech – which received some 70 pages in the novel – had been cut to bare bones and lacks the deep, rigorous, philosophical exposition that Ayn Rand saw as the substance and culmination of the novel.

Strength 2: As was the case with the previous installments, the film’s creators conveyed a plausible sense that the events of Atlas Shrugged could happen in our own world, or at least in a world that greatly resembles ours, as opposed to the world of 1957. In this sense, the film’s creators succeeded in conveying the universality of Atlas Shrugged’s moral message.

Weakness 2: Changes in directors and the entire cast for every single one of the Atlas Shrugged films greatly detract from the continuity of the story, especially for viewers who may watch the films back to back, once all of them are available on DVDs or other media.

Strength 3: The reactions to Galt’s Speech by Ron Paul, Sean Hannity, and Glenn Beck added authenticity and relevance to the film and reinforced the message that the conflict between value-creators and “looters” (cronyists or purveyors of political pull) is very much present in our era. In addition, whether one agrees or disagrees with these notable figures, it was amusing to see them in a dramatization of Ayn Rand’s literary world.

Weakness 3: The film fails to do justice to many important plot elements in Part Three of the book. Hank Rearden – my favorite character from the book and the most compelling character in Part II – barely makes an appearance. Cheryl Taggart’s suicide is only expressed in retrospectives of her realizations that drove her to this desperate act – while she is not actually shown taking any steps toward it. The fate of Eddie Willers at the end of the film is almost completely unaddressed, with a mere intimation that the protagonists have another man in mind for whom they plan to stop – but no validation that this would indeed be Eddie Willers. The treatment of Eddie Willers in the novel is ambiguous; Ayn Rand leaves him beside a broken-down Taggart Transcontinental train engine, abandoned by the railroad workers. He might be rescued, or he might perish – but he has not yet been invited into Galt’s Gulch. The film creators neither pose the ambiguity nor attempt to resolve it. For me, the fate of Eddie Willers – a sincere, moral, hard-working man who respects the achievements of heroic individualists but is not (according to Rand) one of them – is a key concern in Atlas Shrugged. I think Rand treated him with undeserving harshness, considering that people like Eddie Willers, especially if there are millions of them, can be tremendous contributors to human flourishing. The film creators missed an opportunity to vindicate Eddie and give him some more serious hope of finding a place in the new world created by the inhabitants of Galt’s Gulch. In Galt’s Gulch, the film shows Dagny explaining her plan to have a short railroad built to service Francisco d’Anconia’s new copper mine. But who would actually physically build the railroad and do the job well, if not people like Eddie Willers?

Strength 4: The film’s narrator does a decent job at bridging the events of the previous two installments and the plot of Part III. The events in the film begin with Dagny Taggart crash-landing in Galt’s Gulch, and even those who did not read the book or watch the preceding two films would be able to follow how and why she got there. The film is also excellent in displaying the corruption, incompetence, spitefulness, and callous scheming of the crony corporatist establishment that Rand despised – and that we should despise today. The smoky back-room scene where the economic planners toast to the destruction of Minnesota is one of the film’s high marks – a memorable illustration of what the mentality of “sacrificing the parts” for the whole actually looks like.

Weakness 4: While moderately effective at conveying narratives of events and generally decent in its treatment of ethics and politics, the film does not do justice to the ideas on metaphysics and epistemology also featured prominently in Atlas Shrugged. Furthermore, the previous two films were generally superior in regard to showing, in addition to telling, the fruits of the creative efforts of rational individualists, as well as the consequences for a society that shackles these creators. In the Part III film, many of the scenes utilized to illustrate these effects seemed more peripheral than central to the book’s message. Much of the footage hinted at the national and world events that take place in the book, but did not explicitly show them.

Amid these strengths and weaknesses remains an opportunity to continue the discussion about the undoubtedly crucial implications of Ayn Rand’s message to today’s political and societal climate – where there looms the question of how much longer the creator-individualists who power the motor of the world can keep moving forward in spite of the increasingly gargantuan obstacles placed in their way by legacy institutions. Any work that can pose these questions for consideration by wider numbers of people is welcome in an environment where far too many are distracted by the “bread and circuses” of mindless entertainment. Atlas Shrugged: Part III is a film with intellectual substance and relevance and so is worthy of a relatively short time commitment from anyone interested in Ayn Rand, Objectivism, philosophy, and current events. However, those who watch the film should also be sure to read the novel, if they have not already done so, in order to experience much greater depth of both plot and philosophical ideas.

All You Need Is Toleration – Article by Max Borders

All You Need Is Toleration – Article by Max Borders

The New Renaissance Hat
Max Borders
January 28, 2014
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Truth carries within itself an element of coercion.
Hannah Arendt

Identity politics has come to the freedom movement. But does it fit?

Many newly minted libertarians have come out of America’s indoctrination factories feeling a mix of guilt and sanctimony. They’re still libertarians, but they admonish you to “check your privilege” and caution that you may unwittingly be perpetuating a culture of oppression.

Libertarianism alone is not enough, they say.

Our tradition, they urge, needs now to find common cause with various fronts in the movement for “social justice”—struggles against racism, sexism, ageism, ableism, weightism, classism, and homophobia. In that movement, the unit of injustice is the group. Still, joining up means libertarians can attract more young people while forging a more complex, ethically rich political philosophy.

In short, we ought to hitch our wagons to what one might call the “victimhood-industrial complex.” If we don’t, some warn, the millennials will all run to progressivism.

Now if you don’t think this victimhood-industrial complex exists, ask Jonathan Rauch. In his 1993 book Kindly Inquisitors, he argued that free speech was quickly being lost to politically correct censors—especially in higher education. Twenty-plus years later, Rauch says, free speech in the academy is virtually dead:

Unlike most workplaces, universities are at the heart of intellectual life, and so the bureaucratization of speech controls there is more disturbing. In American universities, the hostile-environment and discriminatory-harassment doctrines have become part of the administrative furniture.

And for their student bodies, so also have diversity training, sensitivity seminars, and entire majors devoted to inculcating the victimhood ethosall of which allows victim groups to justify a dangerous promiscuity with power. That’s one reason libertarians should take caution.

Prime Virtue

To take any moral high ground on matters of subjection, we don’t need to adopt the language or agenda of the victimhood-industrial complex. Indeed, that complex (double entendre intended) is part of progressive intellectuals’ designs on power. It is intended to fragment people along contrived, collectivist lines. And we can do better.

I normally don’t make arguments based on ideological purity, but here’s an area in which pragmatic and philosophical considerations prompt us to look to our own tradition for answers. That is, we libertarians already have a virtue that works. It captures the best of our humane concern for others and discards the bromides, the claptrap, the unearned guilt of the dangerously collectivist “social justice” movement.

That virtue is toleration.

Toleration is what separates libertarianism from competing doctrines, at least when it comes to society and culture. If some principle of non-harm orients our political compass, toleration is a moral guide. I realize that might sound a little funny to anyone who’s spent five minutes on Facebook with a rabid Rothbardian. And, of course, self-styled progressives bandy the term about, too. But the classical liberal form is the original—and most resilient—sense of toleration (or tolerance), because it does not carry with it any baggage that might corrode the rule of law, or the freedoms of expression and conscience.

What has liberated great swaths of humanity is not just the idea that people should be as free as possible; it’s the idea that in order for this great pluralist project to succeed, we have to embrace a virtue that allows us to coexist peacefully with others who may not share our particular ideas about the good life (values, religion, ethnicity, culture, or lifestyle preferences). Classical liberals have always accepted the idea that people are seekers and strivers looking for something. Of course there are a billion paths to happiness, life meaning, and well-being. Accepting that, we have to put the pursuit of happiness first, which requires admitting that we’re all different, one to the next, and we will take different paths.

Toleration starts with conscientiously agreeing not to obstruct another’s path.

Our toleration is also dispositional. A more robust toleration involves a mien of empathy, respect, and open-mindedness. It requires us not just to leave other people alone in their pursuits, but also to consider their perspectives and circumstances. The toleration of social justice is often not so tolerant. It requires conformity, censorship, and consensus.

So, if by “check your privilege” one means try to imagine what life might be like for someone in different circumstances, then great. If by “check your privilege” you’re accusing someone of being part of an oppressor class just because she hasn’t been designated a victim, then you’ve thrown toleration out with the bathwater. This formulation seems to mean your rights and opinions are invalid and you have no real complaints or suffering because you belong to X group. Or, more to the point: You are obligated to pay because people who look like you in some ways did bad things at some point.

The Apparently Perfect vs. the Good

So what does it mean to coexist peacefully with others? And doesn’t toleration have limits? Toleration does not come without its paradoxes, real or apparent. It may be difficult to tolerate the intolerant, for example. But radically free speech and a thick skin are about the best we can do—though such may include fiercely criticizing others for their intolerance in a world without any bright line between disrespect and disagreement. As libertarians, we might draw our own line and not tolerate those who regard themselves as “entitled to force the value [they hold] on other people”—and we can use any peaceful means to thwart them in their attempts to disrupt others’ life plans.

No, toleration is neither a perfect virtue nor the only virtue, but it does the work of peace.

What Liberal Toleration Is Not

Our conception does not require envy or guilt to operate. Nor does it require state censorship or wealth redistribution. It doesn’t require that we adopt cultures and communities we don’t like, but rather acknowledges that those communities and cultures will emerge. Our conception of toleration requires only acknowledgement of differences coupled with that disposition to openness.

Our conception of toleration does not accept the murky idea of victim classes. The problem here is the term “class.” Some member of a class may not be a victim at all. Besides, and more to the point, accepting the idea of victim classes implies that there are perpetrator classes—that if group X has frequently been discriminated against, or abused outright, then all members of group Y are liable for those actions (and, indeed, it’s fair to assume their perspective is tainted).

What’s more, the common acceptance of the idea of a victim class can perpetuate a psychology of victimhood among the members of that class, which holds people back. Some theories of social justice go as far as to require that non-members of the victim class accept that they are victimizers by default. While it is possible to institutionalize mistreatment of a group, justice requires us to dismantle the rot in that institution and to stop putting people into groups at all, not to violate other groups for the sake of abstract redress, or to handicap the excellent, or to reward something irrelevant such as someone’s race.

Proponents of the idea of victim classes view “social justice” as a vague cluster of goods, words, and opportunities to be filtered and apportioned equally among people by an anointed few. What isn’t vague, though, is the power they demand and the privilege they mean to extract. By contrast, proponents of liberal toleration require only that you treat individuals with respect, and first, “do no harm.”

Our conception does not hypostasize or collectivize people—treating them as automatically deserving either special consideration or zealous sensitivity, which is supposed to accrue by virtue of the ascribed group membership. Such collectivism lobotomizes individuals. It robs them of their identities and pushes them to accept identities fashioned by others. It strips them of their individual circumstances. It thins their sense of personal responsibility. And it ignores the content of their character.

Our conception does not demand a perpetual pity party, nor invent reasons to be offended, nor cause one to contrive an invisible latticework of injustice that extends up and out in every direction. Instead, our conception embodies the liberal spirit of “live and let live.” The more people who think that way, the fewer victims—real and imagined—there will be. Toleration needs neither rectitude nor guilt, so demonstrations of piety are also unnecessary. It’s a position that can be held by those who think all people are basically good, or that all people are basically lousy. But that means setting aside the business of sorting out victims (the righteous) and oppressors (the sinful).

Finally, as our conception does not require the ubiquity of injustice, it allows for the flourishing of real community. Real community needs real toleration, free speech, and the inevitable frictions that come along with our colliding perspectives. It is from those frictions that better ideas and more favorable consensuses can emerge—at least if you believe John Stuart Mill and Jonathan Rauch.

Taking Back Toleration

The old adage says: To a hammer, everything looks like a nail. To someone who has been educated in the victimhood-industrial complex, everything looks like social injustice.

Toleration might ask more of us sometimes, such as that we not only acknowledge the differences among people but to try to see things from others’ perspectives (empathy). Taking on that view helps us consider how we might reduce all the frictions and figure out the kind of people we want to be. This is not a political doctrine, however. It’s more like remembering the golden rule. It’s about respecting one’s neighbor—be he Sikh or freak or breeder. It’s about acknowledging what evil, intolerant people have done in the past, but also moving on from it.

Toleration even requires us to put up with—politically, at least—the ugliest forms of expression. As Rauch reminds us, “The best society for minorities is not the society that protects minorities from speech but the one that protects speech from minorities (and from majorities, too).” And that’s hard. One has to listen to different voices, taking into account the circumstances of time, place and person, as opposed to treating people as caricatures. Whatever one’s intentions, we must remember that a lot of evil has flowed from forgetting that people are individuals.

Of course, none of this is to argue that racism or sexism or homophobia doesn’t exist, or to deny that people have been mistreated throughout history for reasons that seem arbitrary and cruel to us. It is not even to deny that people are mistreated to this very day—often for those same arbitrary reasons. Rather, my argument is intended to show that a libertarian principle of respect for persons requires toleration, not identity politics.

The great thing about libertarianism is that it is a political superstructure in which most other political philosophies can operate. No other political philosophy features such built-in, full-fledged pluralism. The other basic political philosophies have built-in asymmetries. Progressivism does not tolerate libertarians living as they wish, but libertarianism tolerates progressives living as they wish (with all the caveats about voluntary participation.) And as Hayek said about the conservative: “Like the socialist, he is less concerned with the problem of how the powers of government should be limited than with that of who wields them; and, like the socialist, he regards himself as entitled to force the value he holds on other people.”

So progressives are intolerant of economic freedom. Conservatives are intolerant of social freedom. Only libertarianism maximizes varying conceptions of the good. Nothing under libertarian doctrine precludes embedded communities of any political stripe, and in a free society, we ought to tolerate these clusters as long as they guarantee a right of exit. Indeed, our only requirement would be that if any such community is to persist, it should do so in a matrix of persuasion rather than of coercion.

If we take back toleration, we have a moral high ground that is both appealing to younger generations and works to the benefit of all people. We don’t have to live with the contradictions of progressive social engineers or with conservatives’ half-hearted deference to individual liberty. By practicing real toleration, we can dispel all the various “isms” while leaving people their life plans.

And that’s good enough for libertarianism.

This article was originally published by the Foundation for Economic Education.

Max Borders is the editor of The Freeman and director of content for FEE. He is also cofounder of Voice & Exit and the author of Superwealth: Why we should stop worrying about the gap between rich and poor.

Economies are Not Destroyed in a Day – Article by Nicolás Cachanosky

Economies are Not Destroyed in a Day – Article by Nicolás Cachanosky

The New Renaissance Hat
Nicolás Cachanosky
October 26, 2013
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Earlier this month, Argentina’s leading conservative paper, La Nación published an unsigned editorial comparing the economies of Argentina and Venezuela. The editorial concluded that as economic freedom declines in Argentina, and as Argentina adopts more of what Chavez called “twenty-first century socialism,” it is becoming increasingly similar to Venezuela. Is this true? Will Argentina suffer the same fate as Venezuela where poverty is increasing and toilet paper can be a luxury?

The similarities of regulations and economic problems facing both countries are indeed striking in spite of obvious differences in the two countries. Yet, when people are confronted with the similarities, it is common to hear replies like “but Argentina is not Venezuela, we have more infrastructure and resources.”

Institutional changes, however, define the long-run destiny of a country, not its short-run prosperity.

Imagine that Cuba and North Korea became, overnight, the two most free-market, limited-government countries in the world. The two countries would have immediately gained civil liberties and economic freedom, but they would still have to accumulate wealth and to develop their economies. The institutional change affects the political situation immediately, but a new economy requires time to take shape. For example, as China opened parts of its economy to international markets, the country started to grow, and we are now seeing the effects of decades of relative economic liberalization. It is true that many areas in China continue to lack significant freedoms, but it would be a much different China today had it refused to change its institutions decades ago.

The same occurs if one of the wealthiest and developed countries in the world were to adopt Cuban or North Korean institutions overnight. The wealth and capital does not vanish in 24 hours. The country would shift from capital accumulation to capital consumption and it might take years or even decades to drain the coffers of previous accumulated wealth. In the meantime, the government has the resources to play the game of Bolivarian (i.e., Venezuelan) populist socialism and enjoy the wealth, highways, electrical infrastructure, and communication networks that were the result of the more free-market institutional realities of the past.

Eventually, though, highways start to deteriorate from the lack of maintenance (or trains crash in the station killing dozens of passengers), the energy sector starts to waver, energy imports become unavoidable, and the communication network becomes obsolete. In other words, economic populism is financed with resources accumulated by non-populist institutions.

According to the Fraser Institute’s Economic Freedom of the World project, Argentina ranked 34th-best in the year 2000. By 2011, however, Argentina fell to 137, next to countries like Ecuador, Mali, China, Nepal, Gabon, and Mozambique. There is no doubt that Argentina enjoys a higher rate of development and wealth than those other countries. But, can we still be sure that this will be the situation 20 or 30 years from now? The Argentinean president is known for having said that she would like Argentina to be a country like Germany, but the path to becoming like Switzerland or Germany involves adopting Swiss and German-type institutions, which Argentina is not doing.

The adoption of Venezuelan institutions in Argentina, came along with high growth rates. These growth rates, however, are misleading:

First, economic growth, properly speaking, is not an increase in “production,” but an increase in “production capacity.” The growth in observed GDP after a big crisis is economic recovery, not economic growth properly understood.

Second, you can increase your production capacity by investing in the wrong economic activities. Heavy price regulation, as takes place in Argentina (now accompanied by high rates of inflation), misdirects resource allocation by affecting relative prices. We might be able to see and even touch the new investment, but such capital is the result of a monetary illusion. The economic concept of capital does not depend on the tangibility or size of the investment (i.e, on its physical properties), but on its economic value. When the time comes for relative prices to adjust to reflect real consumer preferences, and the market value of capital goods drops, capital is consumed or destroyed in economic terms even if the physical qualities of capital goods remains unchanged.

Third, production can increase not because investment increases, but because people are consuming invested capital, as is the case when there is an increase in the rate that machinery and infrastructure wear out.

I’m not saying that there is no genuine growth in Argentina, but it remains a fact that a nontrivial share of the Argentinean GDP growth can be explained by: (1) recovery, (2) misdirection of investment, and (3) capital consumption. If that weren’t the case, employment creation wouldn’t have stagnated and the country’s infrastructure should be shining rather than falling into pieces.

Most economists and policy analysts seem to have a superficial reading of economic variables. If an economy is healthy, then economic variables look good, GDP grows, and inflation is low. But the fact that we observe good economic indicators does not imply that the economy is healthy. There’s a reason why a doctor asks for tests from a patient that appears well. Feeling well doesn’t mean there might not be a disease that shows no obvious symptoms at the moment. The economist who refuses to have a closer look and see why GDP grows is like a doctor who refuses to have a closer look at his patient. The Argentinian patient has caught the Bolivarian disease, but the most painful symptoms have yet to surface.

NOTE: This is a translated and expanded version of an original piece published in Economía Para Todos (Economics for Everyone).

Nicolás Cachanosky is Assistant Professor of Economics at Metropolitan State University of Denver. See Nicolás Cachanosky’s article archives.

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This article was published on Mises.org and may be freely distributed, subject to a Creative Commons Attribution United States License, which requires that credit be given to the author.

Why Mitt Romney Will Not Benefit Liberty – Stolyarov’s Response to Steele – Part 2 – Article by G. Stolyarov II

Why Mitt Romney Will Not Benefit Liberty – Stolyarov’s Response to Steele – Part 2 – Article by G. Stolyarov II

The New Renaissance Hat
G. Stolyarov II
October 25, 2012
******************************

Here, I continue my exchange with Dr. Charles Steele regarding the 2012 U.S. Presidential election and the question of whether either Barack Obama or Mitt Romney have any merit as candidates or whether one can be preferred to the other. In “The Imperative of Libertarian Rejection of the Two-Party Trap”, I addressed the question of whether it can be morally legitimate to vote for a lesser evil, and concluded that it is not – particularly where a fundamentally dishonest and deceptive ticket such as Romney/Ryan is concerned. (Readers can also see the aforementioned article for a list of links to the previous installments of this exchange.) Here, I respond to Part 2 of Dr. Steele’s previous response: “Romney v. Obama: Tweedledum and Tweedledee?”.

I will first say that I have no intention of defending Barack Obama or claiming that his second term would not be “as bad” as Dr. Steele portrays. Barack Obama has, in many ways, been responsible for a massive growth of the American police and surveillance state, as well as an expansion of militaristic interventionism abroad. His economic policies have, likewise, been highly damaging to liberty and prosperity alike. Drone attacks on innocents, molestation at the airports, an escalating War on Drugs, persecution of whistleblowers, attempts to conflate Wikileaks with crime and terrorism, health-insurance mandates, bailouts and subsidies to political cronies, inflationary monetary policy, reckless deficit-spending fiscal policy, support for draconian “cybersecurity” legislation that would fundamentally curtail Internet freedom and subject billions of individual communications to monitoring by error-prone algorithms, continuing maintenance of CIA torture facilities (a.k.a. “black sites”) abroad, and the “audacity” to insists that the President of the United States has the authority to assassinate any American citizen abroad, or indefinitely detain any American citizen in the United States, based on his mere say-so – all that (and more along similar lines!) has been the legacy of Obama’s first term. I have absolutely no intention of defending Obama – except in cases where the accusations against him are simply factually untrue, or where his administration happens to have stumbled upon a decent and reasonable policy.

One important question to ask is, “Why has Mitt Romney not emphasized virtually any of the above tremendous harms of the Obama administration?” At the Free and Equal Third-Party  Debate, all four of the participants (Gary Johnson, Jill Stein, Rocky Anderson, and Virgil Goode) had scathing criticisms of Obama’s administration in some (or, in the case of Gary Johnson, most) of the areas mentioned above. Ron Paul’s criticisms of Obama were similarly severe, and similarly on target. The perceptive observer, then, is left to wonder why Mitt Romney’s campaign completely ignores the actual harms caused by Obama during his first term and instead focuses on criticisms that are trivial at best or disingenuous and dishonest at worst. Is it, perhaps, that Romney would himself perpetrate the travesties discussed above, and perhaps intensify them? Is it, perhaps, that Romney’s political base actually insists that he attack Obama for not being “tough” enough with regard to certain military engagements and infringements on civil liberties?  (One must remember that Romney himself stated during the Republican debates that he would have signed the indefinite-detention provision of the NDAA. Furthermore, Romney expressed strong support for SOPA and the Protect IP Act before reversing his stance once it became apparent that continued endorsement of these bills would be politically ruinous.)

Rather than defend Obama or contrast him favorably to Romney, I will respond to each of Dr. Steele’s points by following a general theme: that Mitt Romney is cut from the same cloth as Obama policy-wise, and is even worse personality-wise. Obama, for all of his erroneous and dangerous views and actions, at least seems to have an ideological system that he endeavors to realize, however imperfectly and however subject to political maneuvering and backtracking. Romney, on the other hand, seems beholden to no principles. David Javerbaum has aptly characterized Romney as engaging in “quantum politics” – e.g., “Mitt Romney will feel every possible way about an issue until the moment he is asked about it, at which point the many feelings decohere into the single answer most likely to please the asker.”

This, then, can be seen as my response to Dr. Steele’s point regarding the “general vision” of the two candidates. Dr. Steele wrote that “This presidential election is not so much a choice between Mr. Romney and Mr. Obama as it is between two competing visions of the role of government.” I respond that the two parties do not represent competing visions, because the Republicans – by nominating Mitt Romney – have shown that they do not represent any vision whatsoever, or at the very least that their “vision” is a blank to be filled by the expediencies of the day. A left-progressive vision, however erroneous or even dangerous in some respects, is at least relatively predictable – though even many left-progressives (e.g., Rocky Anderson of the Justice Party) are themselves disgusted at the course the Obama administration have taken and strike me as a lot more honest and at least capable of doing good in certain areas (e.g., civil liberties), as compared to either the Democratic or the Republican establishments.

I certainly do not see in Romney/Ryan or the Republican establishment the barest shred of “the view that government is limited by the rights of the individual, and that most of civilization is built by free people acting in the market.” Romney’s incessant ads in Nevada about how he opposes Barack Obama’s “threats” to Social Security and Medicare are a case in point; he is just another establishment campaigner who tells various segments of the electorate what they want to hear, and portrays his rival as a terrible menace. But more importantly, the Republican establishment has shown that it not only cares little for individual rights in theory – but it is ready to trample upon them in practice, through the fraudulent and sometimes violent manner in which supporters of Gary Johnson and Ron Paul were effectively disenfranchised during the nominating process and – at the Republican National Convention – were met with a “rule change” (adopted over the loud objections of the delegates) that will effectively bar grassroots delegate selection in perpetuity. The Republican Party, by preventing even their previously most ardent grassroots supporters from rising to positions of prominence in future elections, has closed itself off from any connection with individuals or the free market. It has become the party of oligarchic elites – the party of crony corporatism and entrenched political favoritism. To be sure, the Republican Party does need its “useful idiots” to mobilize mass fervor against the Democrats and win elections. Hence, the Republican establishment fails to quell xenophobic, theocratic, and racist bigotries (e.g., the oft-repeated claims that Obama is an atheist Muslim who was not born in the United States). Even though the Republican elites are too intelligent to fall for such nonsense themselves, they are too callously manipulative and devoid of principles to discourage sentiments that may be politically useful to them.

Dr. Steele writes that “conservatives are far more skeptical of government than are progressives” – but this refers to a conservative movement that was perhaps of this sort some thirty years ago during the Reagan era (in rhetoric at least), but not at all today. While Dr. Steele asserts that “the Republican Party is the party of skepticism about government”, the Republican Party gave us unprecedented expansions of federal-government power during the George W. Bush era. Indeed, a principal observation regarding  the Obama administration’s deleterious effects for liberty is that Obama has built upon the foundation that George W. Bush created, with few material departures. Today’s Republican Party is a mix of neoconservatism, theoconservatism, crony corporatism, and pop-conservatism. Libertarianism is not a material component of the Republican agenda – other than occasional lip service to libertarians during election years – just to get their vote. Every election season, the Republican Party courts libertarians, and every time it has electoral success, it simply discards any pretense at pursuing even a quasi-libertarian agenda. When was the last time that a Republican victory has brought about any policy shifts in a remotely libertarian direction?  In the face of such repeated bait-and-switch tactics, how many times does it take to learn not to fall for them again? How many times do good libertarians need to be deceived by entrenched political elites who have no intention of diminishing the scope of their power?

Dr. Steele contrasts the Democratic and Republican platforms, but even the shreds of pro-liberty sentiment in the Republican platform were hard-won from the establishment by the tireless activity of Ron Paul’s supporters on various Republican committees. These friends of liberty were faced with procedural manipulations and threats from the establishment for attempting to introduce pro-liberty platform planks, and it is certainly salutary that they succeeded. But they were able to plant a few saplings of liberty into extremely hostile soil. The Republican establishment will never accept libertarians and will try, at every turn, to undo these hard-won gains. Attempting to accommodate the Republican establishment will turn libertarians into mere tools for specific establishment aims – as exemplified by the case of Rand Paul, who was largely ignored by Romney after achieving the useful (to Romney) goal of splitting the Ron Paul movement by endorsing Romney. Rand Paul was merely given a speech at the Republican National Convention – but that was largely it in terms of his “gains” from the endorsement. The liberty movement certainly did not gain even that much, as no policy victories were won by Rand Paul’s action. Another potential approach, that of overruling the establishment and “taking over” the party, has become close to impossible after the National Convention, and so the only reasonable course of action left to libertarians is to abandon any connection to the Republican Party and act entirely outside of its confines.

On the matter of free speech, Dr. Steele writes about the threat of Jim McGovern’s proposed “People’s Rights Amendment”, which would overturn the Supreme Court’s Citizens United decision. While this proposed amendment is certainly problematic, I do not see a direct connection between it and Barack Obama. Certainly, some high-profile Democrats support it, but that is no guarantee that it would pass or that Obama would endorse it if he received a second term. As an analogy, numerous Republicans have voiced support for overturning the Supreme Court’s Roe v. Wade decision on abortion (including through the means of “right to life” Constitutional amendments – and Republican candidates for President have often endorsed this course of action far more vocally than Obama has ever commented on the Citizens United decision. Yet Republicans elected to office are virtually powerless to do anything about Roe v. Wade, due to the vestiges of the separation of powers that remain. There are dire ways in which free speech is being eroded in the United States, but campaign finance is one of the least concerning areas in this respect. I am far more disturbed by the violent suppression of peaceful political protests (e.g., the pepper-spraying incident at University of California Davis in November 2011, for which the University has now offered to generously compensate the victims), as well as the overarching surveillance state which is emerging due to the domestic “War on Terror”. Internet monitoring of the sort contemplated by CISPA and the National Security Agency’s planned data center in Utah would surely have a chilling effect on free expression online. Likewise, the intimidation and harassment that some of Romney’s supporters have directed at supporters of Ron Paul and Gary Johnson certainly are not helping the cause of free speech. As someone who personally experienced such attacks, I would certainly not trust the attackers’ candidate of choice with safeguarding my rights under the First Amendment.

Dr. Steele is also concerned about the purported Democratic opposition to the right to bear arms under the Second Amendment. Yet the right to bear arms is one area in which liberty has actually made progress over the past decade – and this progress has largely been untouched by Obama during his first term in office. While the Democratic platform may call for some restrictions on gun ownership, even this language is mild compared to the rhetoric of the gun-control movement in the 20th century (particularly prior to the decline of crime rates in the 1990s).  Due to Supreme Court decisions such as Heller and concealed-carry laws in various states, widespread gun ownership has been subject to fewer legal restrictions in recent times, coinciding with the continued drop in rates of violent crime. This recognition that liberalization of gun laws did not lead to crime increases, combined with the extreme strength of interest groups such as the National Rifle Association, should keep at bay any attempts to limit Second Amendment rights at the federal level – no matter which party controls the Presidency. The greatest threat to gun-ownership rights remains at the local level, particularly at educational institutions that attempt to impose “gun-free” zones where not even teachers and administrators can bring weapons that could deter potential shooters and immediately disable any who are not deterred.

Regarding PPACA/Obamacare/federal Romneycare, Dr. Steele responds to my argument that Romney would not veto it by stating that “the PPACA is much hated by the Republican base (for that matter the majority of Americans dislike it).  A repeal would be extremely popular.  It’s simply incredible to think that a President Romney would defy his party and practically 100% of his supporters in order to save Barack Obama’s hallmark program. “ Dr. Steele “can’t imagine anything else he could do that would make him more likely to lose the GOP nomination in 2016.” This assumes, however, that the political base matters to Republicans like Romney to any greater extent than as vessels for whipping up sentiment and winning elections. It is much more likely that the Republican Party strategists will rely on the perceived political amnesia of the masses and will hope that the public in 2016 will have forgotten any promises to repeal PPACA. Romney has already anticipated this behavior and publicly backtracked on his promise to repeal PPACA and stated that there are many portions that he would retain. Most likely, the worst part of PPACA – the individual mandate – which Obama initially opposed but was persuaded by politically powerful health insurers to include, will be among the parts that Romney – being the representative of corporate cronyism that he is – will retain. It is true that Romney might support some partial reforms to PPACA, but if the individual mandate remains, then these reforms would amount to a mere reorientation of PPACA in an even more corporatist direction, rather than a repeal or a movement toward a more free-market outcome. Under Romney, there might be fewer requirements and restrictions regarding the behavior of health insurers – but, in the status quo, those mandates and restrictions largely have the effect of partially (and, in the fashion of Mises’s “dynamic of interventionism”, with severe unintended negative consequences) compensating for the pernicious effects of the individual mandate. A Romney-style amended PPACA might simply enable health insurers to exploit their new captive clientele with few limitations or checks.

Dr. Steele writes that “it’s not clear that Romneycare and Obamacare really are the same thing, despite a similar basic framework. The Massachusetts bill signed by Romney was different from that which was implemented.  Romney used his line item veto on a number of the more draconian parts of the bill.  The Democratic legislature overrode these vetoes, and the bill was implemented by a Democratic governor who further altered it.  Furthermore, at the time Romney signed the bill, the situation in Massachusetts insurance markets was far worse than perhaps anywhere else in the United States.  In this context, Romneycare – at least Romney’s version of it – was arguably an improvement over the status quo in Massachusetts.  Thus when Romney argues that the reform might have been right for Massachusetts but not for America in general, he’s not necessarily being disingenuous.”

The best way to determine how similar or different Romneycare is from Obamacare is to consult the economist who designed both, Jonathan Gruber, who recently stated regarding the individual mandates of the two systems in particular, that “They are very similar […] They aren’t the same exact mandate, but they have the same basic structure.” Because the individual mandate is by far the most pernicious part of PPACA, this is enough of a similarity to make Obamacare and Romneycare fundamentally more alike than not. It is also appropriate to consider the statements made by Romney. As is typical with Romney, he vacillates on the matter of whether Obamacare does or does not resemble Romneycare, but he did praise Obama for incorporating elements of Romneycare into PPACA. In April 2012, Romney even explicitly praised the individual mandate! The distinctions that Romney makes are that (1) Romney’s plan was state-based rather than federal (as if he had a choice as Governor of Massachusetts – and besides, bad ideas have to start somewhere, and Massachusetts was Gruber’s training ground), (2) that Romney’s plan did not raise taxes (which is false; Alex Seitz-Wald points out that the penalties for failing to purchase insurance, which the Supreme Court has now ruled to be taxes, were higher under Romneycare), (3) that Romney’s plan did not cut Medicare (again, a defense of the Medicare status quo on Romney’s part), and (4) that Romney’s plan did not include price controls (but Massachusetts does impose price controls now, as Ben Domenech points out – and this may have been Romneycare’s logical evolution).

Dr. Steele also writes regarding the possibility that Obama would appoint “democratic constitutionalist” justices to the Supreme Court, which would result in the spread of “the notion that our Constititutional rights should not be considered “absolute” sense, but rather subject to international norms.” Dr. Steele believes that “Romney is unlikely to draw from this crowd, and far more likely to draw from judges with at least some sympathy for the new federalism.” While I certainly prefer the interpretation which Dr. Steele calls the “new federalism” over “democratic constitutionalism”, I see this particular clash of interpretations as too many steps removed from the outcome of a Presidential election. To be sure, the President may appoint Supreme Court justices, but that is all. How the justices subsequently rule is out of the President’s hands. Indeed, it was the George W. Bush appointee John Roberts who cast the deciding vote to uphold the constitutionality of PPACA’s individual mandate. The 2005 Kelo v. City of New London eminent-domain decision was joined by George H. W. Bush appointee David Souter and Ronald Reagan appointee Anthony Kennedy. And, as I previously pointed out, the Florence v. Board of Chosen Freeholders decision of April 2012 was entirely the doing of the “conservative” bloc (including Anthony Kennedy). If the “new federalism” of these judges considers strip searches without criminal suspicion or material risk posed by the individual being searched to be constitutional, then perhaps it is not that strong of a safeguard of our liberties after all. But largely, my point is that any given Supreme Court justice is too much of an unknown quantity upon appointment for one to be able to make any decisions regarding the appointer on the basis of whom he might potentially, conceivably appoint – that is, if a vacancy appears in the first place and if the Senate would confirm that appointment.

Regarding which candidate is more anti-entrepreneur, Dr. Steele writes that “Mr. Stolyarov suggests that Romney is anti-entrepreneur in practice, but it is small entrepreneurs who are most hurt by regulation.  Large established firms have teams of lawyers and accountants and frequently can benefit from gaming the rules; in practice, Obama is a greater threat to entrepreneurship.” But it is precisely the large established firms that will be explicitly favored by a Romney administration – as evidenced by Romney’s support for the various bailouts and “stimulus” plans of 2008-2009. (Incidentally, it was Romney who said during the first Romney-Obama debate that “You couldn’t have people opening up banks in their — in their garage and making loans.” This is clearly a statement of opposition to small entrepreneurship and an expression of desire to protect entrenched large financial firms from competition by innovative startups.) The only difference between Obama and Romney is that, while Obama supports subsidies to “alternative” businesses (and financial firms), Romney supports subsidies to “traditional” businesses (and financial firms) – combined with a heavy dose of mercantilist protectionism (evidenced by numerous Romney campaign flyers sent out in Nevada about how Obama is allegedly “selling out” the United States to China by endorsing foreign-made products). Romney is the candidate of politically connected Wall Street firms and large banks (who also hedge their bets by donating large amounts of money to the Democratic Party). If he is elected, these entities will be free to continue to enrich themselves at taxpayers’ expense, while socializing their losses. Bailouts and labyrinthine federal rules are key to the continuation of this exploitation of taxpayers by connected financial firms – and Romney is virtually certain to encourage the proliferation of such measures.

Dr. Steele writes that “Romney and Ryan have been willing to put forward the idea that entitlement programs as they exist are unsustainable and must be radically restructured.  Obama assures us this won’t happen.” Yet it is Romney/Ryan whose ads continually denounce Obama for “threatening” Social Security and Medicare and promise that Romney/Ryan will not take those benefits away but will rather “strengthen” those programs. Gary Johnson, when observing the first Romney-Obama debate, repeatedly pointed out that the two candidates were in competition regarding who could make more extravagant promises to preserve Medicare. I agree that the federal entitlement programs are unsustainable, but Romney, like Obama, is happy to argue for their perpetual existence as a way of gaining votes in the short term – at the expense of long-term prudence.

On taxation, Dr. Steele writes that “Obama has stated a clear preference for increases in marginal rates on higher income earners, higher corporate taxes, and an increasing number of tax breaks, this last for purposes of social engineering (a.k.a. buying votes).  Romney has endorsed a reduction in marginal rates and a broadening on the base by eliminating deductions and exemptions.  The latter approach reduces the economic distortions of taxation and also returns it to the purpose of collecting revenue, rather than shaping citizens’ behavior to match politicians’ goals.” While I certainly do not support Obama’s approach (or any tax increases at all), it is not at all clear that Romney’s approach is preferable – especially since, as Dr. Steele acknowledges, we do not know quite what it entails, and Romney keeps contradicting himself regarding its contents. What we do know for certain, though, is that Romney’s planned massive increases to military spending are mathematically irreconcilable with any sensible fiscal policy or any description of Romney’s tax plan. If fiscal responsibility is to be the deciding issue of this election, then Obama might even be preferable to Romney because while Obama’s budget plan aims to increase military spending very slightly, Romney’s plan would lead it to skyrocket. Ultimately, unsustainable foreign entanglements have led to the United States’ budget surplus from the late 1990s turning into a massive deficit. Without significantly curtailing American military spending and engagements abroad, resolving the current fiscal mess is impossible. The Economist points out that, more generally, Romney’s statements are mathematically incoherent, and his tax plan, as publicly presented, would not be able to solve the United States’ fiscal problems without significant tax increases on middle-income-earners.

Dr. Steele concluded his essay with some thoughtful caveats, and I would also like to mention a few of my own, though they cannot be said to arise from any virtues on Romney’s part. First, a Romney victory could galvanize Democrats to behave in a manner more reminiscent of the George W. Bush era, during which many of them actually opposed American foreign entanglements and expressed outrage at violations of civil liberties. As Glenn Greenwald points out, Obama’s election has led many of Obama’s supporters to become blind to the administration’s abuses of civil liberties at home and abroad. Perhaps, if the Democrats again become the party of the opposition, the old civil-liberties sentiments could be revived and strengthened (even if only to be used as a tool of political convenience against the Republicans). Second, Romney and Obama might both be mere figureheads of a larger political establishment: the “bipartisan” consensus – implemented by a federal bureaucracy whose operations do not shift due to a change in leadership, and existing to serve elites whose real power arises from connections and does not depend on particular formal titles. If this is the case, then Obama’s or Romney’s individual presence or influence in office might not amount to much at all. Therefore, the outcomes in terms of policy might be the same irrespective of which one of them wins. Third, interestingly enough, a similar irrelevance might be anticipated if Dr. Steele is correct in stating that “If elections and political processes do anything in this regard [expanding liberty], it will be simply to respond to and formalize advances made by civil society.” In that case, a politician who seeks to retain office would have little choice but to succumb to the pressures of civil society sooner or later, and the party in power does not matter so much, except possibly with regard to the timing and tone of that acquiescence. (An example of this is the recent initially reluctant but subsequently strong expression of support for legalized same-sex marriage by Barack Obama, who originally campaigned against it, but whose hand was essentially forced by the public discourse of the issue.)

Yet, with all this said, I can anticipate one major harm of a Romney victory that might outweigh all possible incidental benefits. That harm is the normalization of lying in American politics. As I discussed above and in Part 1 of my response, Romney is a different breed of politician, in that he does not have a shred of consistency on virtually any issue – and is willing to lie even when lying is not necessary to gain him political advantage. A Romney victory would convey a clear signal to the electorate and to political pundits and strategists that facts do not matter and honesty does not matter in politics. Of course it is true that many politicians today make false promises and selectively portray the truth; Romney is far from the first. But the overt factual falsehoods stated by Romney and Ryan are a different and more egregious sort of lies from the false promises, vague generalities, and dissembling characteristic of more “traditional” American politicians. A Romney victory would complete the transformation of American elections into reality shows with much rhetoric and fanfare, but no substance; it would finalize the disconnect between the basis for the people’s decisions in electing a candidate and the actual policies that candidate implements (based, presumably, on consideration of more reliable and accurate information than the nonsense disseminated on the campaign trail). A Romney victory would cement the unfortunate conviction of many on the political Right in the United States that they are entitled not just to their own opinions, but also to their own facts (which may, in Orwellian fashion, morph into their diametrical opposites based on the political agenda du jour). I am reminded here of Mises’s discussion in Human Action of the errors of polylogism. A Romney victory would create a peculiar sort of “Republican logic” or “conservative logic” that employs “Republican facts” or “conservative facts” that differ from the objective facts which, well, happen to be true. Already, the derision aimed at fact-checking organizations by many on the Right today foreshadows this unfortunate possibility – which would render the entire conservative movement (and any libertarians who ally with it) a historical irrelevancy and laughingstock, but not before it inflicts tremendous human suffering in the manner of virtually every major polylogist movement in history.

This brings me to the last point of discussion with Dr. Steele, the matter (discussed in the comments of my Part 1) of whether the Romney campaign has misrepresented the Obama administration’s approach to work requirements for welfare eligibility. I note that this is a matter on which a wide spectrum of sources are unanimous – including The Washington Post (which leans Republican), ABC News, and NPR. PolitiFact (which also leans rightward) has called the Romney campaign’s statements on this matter “pants on fire” lies.

Dr. Steele writes that “Robert Rector, one of the authors of the original reform act, has given a detailed and careful argument for why he considers the move by Obama’s HHS move a gutting of the requirements.” It seems that Rector actually originated the claim that the HHS memorandum of July 12, 2012, would “gut” welfare reform. This is his blog post of the same day, making that claim. It is clear that, akin to the dynamics of the game of “telephone”, the Romney campaign took Rector’s statements and exaggerated them further to claim that Obama’s administration has already “announced a plan to gut welfare reform by dropping work requirements” – when in fact no such plan has been made,  no waivers of any nature have been requested or granted, and the HHS memorandum specifically cautioned against dropping work requirements. Rector (unlike the Romney campaign) at least provides some details for his interpretation, but it appears to be one remote hypothetical possibility among many, at best, and it is at odds with the explicit statements of the Obama administration that work requirements will not be dropped. Another of the authors of the TANF program, Ron Haskins, stated to NPR that “There’s no plausible scenario under which it [the HHS memorandum] really constitutes a serious attack on welfare reform.” The NPR article perceptively observes: “So why continue beating this drum? Partly because people believe it.” This is a prominent illustration of the cynical and manipulative conduct of the Romney campaign. Facts do not matter to Romney and Ryan; the public appeal of any particular message – even if it is factually false – does.

Dr. Steele also writes that GAO has declared that contrary to what the Obama administration has argued, HHS has overstepped its bounds in this matter and by law must submit the proposed changes to Congress.” Yet the GAO letter does not comment on the practical effects of the HHS’s waiver authority on work requirements. It simply states that the HHS’s attempts to exercise such authority constitute a “rule” under the Administrative Procedures Act, and that this “rule” must be submitted to Congress for its approval. Perhaps it must. Yet this is not, per se, support for the contention that Obama has “gutted” welfare work requirements.

Furthermore, the American Conservative Union article linked by Dr. Steele states that “No state has submitted a waiver request. Nor have any been approved. The GAO report has effectively blocked all Sebelius-led changes to TANF work requirements, but what would have it have done [sic]? The specific changes would vary from state to state, depending on whether a state requests a waiver and whether HHS approves the proposed new methods.“ This is precisely the opposite of the Romney campaign’s contention that the Obama administration “gutted” welfare work requirements. First, no actual waivers have even been granted, so any “gutting” is hypothetical only. Second, if any waivers are to be granted, the specific changes would vary by state and would largely depend on what a particular state requests. Again, it is entirely unwarranted to leap from the ability of a state to request a waiver of certain specific methods to the presupposition that the waiver would entail an elimination of work requirements altogether (which elimination is contrary to federal law in any case).

To conclude, I reiterate my question of why Romney is even emphasizing this non-issue so strongly – when there is a myriad of actual atrocious infringements of liberty by the Obama administration which could be used to legitimately denounce Obama’s first term? The only reason that suggests itself is that Romney would commit more of the same infringements, and any differences with Obama are superficial only.

The Imperative of Libertarian Rejection of the Two-Party Trap – Stolyarov’s Response to Steele – Part 1 – Article by G. Stolyarov II

The Imperative of Libertarian Rejection of the Two-Party Trap – Stolyarov’s Response to Steele – Part 1 – Article by G. Stolyarov II

The New Renaissance Hat
G. Stolyarov II
October 21, 2012
******************************

Here I offer the first installment of my response in an ongoing exchange with Dr. Charles Steele regarding the merits (or lack thereof) of various candidates in the 2012 U.S. Presidential Election, as well as the question of whether or not it is justified for a libertarian to prefer Mitt Romney over Barack Obama.

Incidentally, this weekend, I had the opportunity to vote early in Nevada and to cast my vote for Gary Johnson, the Libertarian nominee for President. My hope is that, in this election, Gary Johnson will beat all records in terms of the total votes received by a Libertarian candidate. (See the historical record of votes received by Libertarian candidates here.) This would send a strong signal to the establishment that Americans who love freedom are displeased and outraged at the directions in which both major parties would like to take the country.

For the benefit of my readers, I provide below a list of links to prior installments of this exchange in chronological order.

* “Rand Paul’s Endorsement of Romney Versus Ayn Rand’s and Murray Rothbard’s Historical Grudging Endorsements” – My initial post of September 3, 2012, and a comment by Dr. Steele.

* “Is Mitt Romney Truly a ‘Lesser Evil’?” – My article of September 6, 2012

* “Is It Evil to Vote for a Lesser Evil? Steele’s Response to Stolyarov – Part 1” – Dr. Steele’s article of October 2, 2012

* “Romney v. Obama: Tweedledum and Tweedledee? – Steele’s Response to Stolyarov – Part 2” – Dr. Steele’s article of October 17, 2012

I begin by addressing Dr. Steele’s response in Part 1 to the philosophical argument regarding the impropriety of voting for a lesser evil. In my next installment, I will discuss in greater detail the specific differences between Romney and Obama that Dr. Steele addressed in his Part 2. Dr. Steele stated that most of his questions are not rhetorical, so my purpose here will not be to disagree with any real or perceived implications of such questions – but rather simply to elaborate upon my answers to them and my related views and understandings of the present political situation.

Dr. Steele writes: When we vote, we vote under conditions of uncertainty about what the candidates will do should they win.  Two reasonable people might differ in their expectations over what opposing candidates might do if elected, even if the candidates are truthful.“

I respond: It is true that people vote under conditions of uncertainty. However, a candidate’s historical record of adherence to his or her promises is a decent indicator of whether this candidate will adhere to his or her promises in the future. Furthermore, a candidate’s record of intellectual consistency can serve as a decent indicator of whether that candidate will flip-flop on issues in the future.

Dr. Steele writes: And candidates are often less-than-truthful about what they will do if elected; sorting out what is and isn’t true is not necessarily straightforward.  Consider a presidential election between A and B.  If candidate A wins the election and what subsequently transpires is counter to what the voter in good faith expected, what is the voter’s moral responsibility?

I respond: This is precisely why it is essential not to support candidates with a record of being untruthful, disingenuous, or prone to reversals of their positions. With a candidate like Gary Johnson or Ron Paul, one knows what one is getting, because these men have not materially altered their views or policy recommendations over the course of decades. This is true, also, of certain politicians with whom I have many fewer ideas in common but whom I nonetheless respect for their integrity and consistency – such as Dennis Kucinich, Bernie Sanders, and Ralph Nader. Furthermore, these men have histories of actually trying to put their views into practice. The extent of their success may be outside of their full control (because it is subject to the responses and often the resistance of others), but at least they try honestly, and this is apparent to anyone who studies their records.

Sometimes it may also be acceptable to give an untried candidate (for instance, a young and seemingly intelligent and honest politician with little experience in office) a chance if he or she presents a well-supported impression of competence, knowledge, productivity, and integrity. However, in the long term, the records of those people will also speak for them more clearly than their initial presentations, and they are deserving of continued support only if they show through their deeds that they actually meant what they promised.

 On the other hand, a person such as Mitt Romney has a record of repeatedly changing his rhetoric to directly contradict statements he made in the past. Romney is, in essence, a political “weather vane” – seeking to reflect what he and his political handlers consider to be the predominant attitudinal currents of the particular time and place. Furthermore, Romney has a decidedly un-libertarian policy record as Governor of Massachussetts, a candidate, and a private citizen (in his advocacy of bailouts, Medicare expansion, indefinite detention of Americans, and ever-expanding military interventions abroad). Romney’s problem, furthermore, is not so much that he pursues a non-libertarian set of principles (as some respectable politicians might), but that he does not appear to act on any set of universalizable principles whatsoever. Mitt Romney at time X is quite willing to pursue the opposite set of views and policies from Mitt Romney at time Y. Moreover, RomneyX will deny the existence of RomneyY’s views, and vice versa.  Thus, reasonable observers should not expect him to keep his word, or for his word to be worth much in terms of an indicator of his actual views and planned behavior.

Observation and experience have taught me that honesty and dishonesty are fundamental character traits of individuals. Some people find it extremely difficult morally and even inconvenient practically to lie, as it requires the invention of an entire parallel reality that must continually be kept up in order to prevent others from detecting the lie. Others make lying (in either a blatant form or in the form of half-truths) a way of life. People who achieve a measure of material success by means of lying or presenting false impressions will tend to escalate such behavior until it becomes a pervasive, personality-swallowing, and ultimately self-defeating compulsion.  Occasionally, good people may justifiably lie in order to protect themselves against hostile forces that would use the truth as a tool to unjustly and illegitimately harm the truth-teller. However, such situations are rare in the normal course of events, and good people would lie in such situations as an uncomfortable emergency measure of self-defense whose recurrence it is hoped to avoid.

The mark of a compulsive liar is that he lies even when he does not have to – when telling the truth would be fully consistent with his best interests and even his public image. Mitt Romney and Paul Ryan both have shamelessly distorted facts in their campaign speeches, advertisements, and debate performances. Due to the Internet, these distortions can be readily identified, and the facts can be brought forth to correct them – but Romney, Ryan, and their handlers do not appear to be cognizant of this reality. When their untruths are pointed out to them, they either continue to assert them with a straight face (as in the case of the Romney campaign knowingly using false statements in its advertisements regarding Obama’s non-existent elimination of the work requirement for unemployment-benefits eligibility) or they deny that they made such statements in the first place despite video evidence to the contrary (as in the case of Ryan denying ever expressing praise and admiration for Ayn Rand, or Romney repeatedly asserting that his tax plan either does or does not reduce the tax obligations of the highest income-earners and expressing bewilderment that anyone ever thought that Romney had said the opposite of the assertion du jour). What is astounding is that Romney/Ryan would not have lost an iota of public support by accurately and transparently representing both their own intentions and Obama’s record in office. There are numerous valid criticisms of the Obama administration – enough to occupy any challenger’s time. There is no need to invent facts or engage in distortion in order to address Obama’s genuine blunders in the realms of economic policy, foreign policy, and infringement of civil liberties. Likewise, a full representation of Romney/Ryan’s actual proposed policies would have been far more salutary than a vague set of incoherent and mutually contradictory generic assertions that try to mean everything for everyone.

In short, the problem with Romney and Ryan is not so much what they stand for, but the fact that they can stand for anything and nothing and that integrity and consistency cannot be expected of them based on their campaigning tactics and policy records. More generally, even a halfway-decent judge of character will be able to distinguish between a person of integrity and a habitual liar in politics. All that is needed is a look at the facts – precisely what the habitual liars in politics consider unimportant.

Dr. Steele writes: Further, we also don’t know and will never know what B would have done.  Does that matter?  Might not a vote for what proved to be A’s bad policies have prevented B’s worse ones? In many cases these issues are small, but not always.  And certainly in times of major institutional transitions, or economic crises, or other important changes, they are likely to loom large.”

I respond: This presupposes that A and B are the only genuine alternatives. In fact, since voting is ultimately the result of an aggregation of individual decisions, the conceivable alternatives are numerous, if only people would see them that way. One might consider two-party politics in the United States to be a sort of collective reverse prisoners’ dilemma – in the sense that the political situation would be much better if people simply did not care about how others plan to vote and would simply vote their conscience – based solely on their independent evaluation of the views and records of the candidates running. It is only because voters try to anticipate one another’s preferences and adjust their own accordingly that the two-party oppression of the status quo has come about.

Over the years, the difference between the “greater” and “lesser” evil has become ever harder to distinguish, either in magnitude or in the identity of the “greater” and “lesser”. This is because the strategists in the two parties know that they do not need to present candidates that differ materially in practice anymore. All they need to do is to put up a show and engage in polarizing but utterly vacuous rhetoric – in order to get the electorate to think that enough of a difference exists to justify voting for one wing of the establishment or for the other. The reality behind the scenes is that we are governed by an elite “bipartisan” consensus where there exist occasional minor policy changes because of the shifting dynamics among the myriad pressure groups comprising the elite. However, the fundamental assumptions of that consensus – including massive corporate welfare, systemic restrictions on upward economic mobility for most, the cartelization of much of the economy, various boondoggles for special interests (including military interventions, “homeland security,” and the War on Drugs), and the need to obtain elite permission to make major innovations that depart from the status quo – remain unchallenged within the two-party establishment. This continuity of policy despite rotations of the parties in power has been strengthening over the years. Thus, it has often and justifiably been remarked that Obama’s first term in office is essentially indistinguishable in practice from a third term for George W. Bush.

At the same time, the gulf between the elite consensus and the possibilities of emerging technologies is becoming ever wider – particularly as the elite is composed predominantly of people who do not understand those technologies and try to operate according to assumptions that only work in a pre-Internet world. The elite reaction to the hyper-empowerment of individuals through personal technology is to crack down ever harder. Hence, we have seen in the past decade and especially in the past several years both an accelerating pace of technological improvement and a flurry of bills (COICA, SOPA, Protect IP, CISPA) and treaties (ACTA and the Trans-Pacific Partnership) attempting to restrict Internet freedom. Ultimately, this interplay of trends can result only in the amazing liberation of individuals or a more totalitarian tyranny than any which came before.

With regard to Dr. Steele’s reference to major institutional transitions and economic crises, we are indeed in such a time period, but the essence of the transition is precisely the manner in which technology tends to yank influence away from the power elites (often without an explicit design to do so) – and the essence of the economic crisis is precisely the power elites’ reaction in attempting to entrench old, failed institutions (through techniques such as bailouts, inflation, subsidies, modern-day guilds, and barriers to competition) and bar the majority of people from prospering due to the unleashing of technology’s full potential. Neither Obama nor Romney stands on the right side of the institutional transition. Especially in this pivotal time, it is imperative to side with those who aspire for individual hyper-empowerment and to reject the two-party elite.  A key part of individual hyper-empowerment is to vote independently of one’s expectations of how others might vote. Setting an example through one’s own decisions (and one’s vocal discussion thereof) can persuade increasing numbers of people to extricate themselves from the trap of pernicious assumptions created by the “bipartisan” consensus.

Dr. Steele writes: If one votes for a candidate who wins, does one then share responsibility for everything the candidate does?  When we vote for candidate A, we get the ‘entire package.’  We can’t limit ourselves to voting for her/his positions on some issues but not others.  Suppose one agrees with candidate A on fiscal policy, but disagrees on foreign policy, and conversely supports B on foreign policy and opposes his fiscal policy.  In order to decide between candidates, our voter must judge which issue is more likely to be of central importance in the next term, as well as which one is more important for the voter’s overall vision of what should be done.  For that matter, the voter might think that B’s fiscal policy is a more serious flaw than A’s foreign policy, but also believes institutional barriers (e.g. Congress) will largely block B’s fiscal policy while nothing would block A from pursuing the bad foreign policy, and hence reasonably vote B.”

I respond: While it is true that some degree of unpredictability exists with every candidate, there is a major difference between whether that unpredictability is a result of unforeseen contingencies beyond that candidate’s control (e.g., major external events that change the incentives, constraints, and pressures facing a politician) or whether it is a result of the politician simply never intending to form a strong connection between what he says and what he does. Thus, while a person who supports a particular candidate may not be morally responsible for every particular action by that person in office, that person is responsible for helping to elect either a fundamentally honest person or a fundamentally dishonest one. By knowingly electing a fundamentally dishonest person, one essentially writes a blank check for that person to do as he pleases in office, without much connection to any particular intellectually coherent platform or set of ideals.

With regard to weighing the importance of various policy issues, I agree that this assessment may differ based on a voter’s factual expectations as well as his subjective assessment of various areas’ relative significance. However, a fundamentally dishonest politician cannot be expected either to have the same priorities as any given voter, or to fulfill his promise to address particular issues he represents as priorities. In essence, the credibility of a dishonest politician like Romney in communicating particular priorities has already been shattered, and he is therefore an almost unknown quantity in how he would address issues. I say that he is almost an unknown quantity, because whatever Romney does is likely to be strongly biased toward preserving the perverse dynamics inherent in the status quo – i.e., the political trend toward totalitarianism and the further entrenchment of the pressure groups that predominate in today’s “bipartisan” consensus.

Dr. Steele writes: How much difference does one’s vote make, anyway?  The quote from Mr. Stolyarov suggests that if candidate A wins, a person who voted for him shares some responsibility for what transpires.  But suppose A wins with a very large margin of the vote.  In that case, there’s nothing the voter could have done to stop what transpires.  What is her/his responsibility then?

I respond: While any given voter’s moral responsibility may be minor in this case with regard to any particular outcome, there is still some moral responsibility in the sense that the voter permitted himself to be one of the masses who supported the winning candidate despite strong initial indications that the candidate is  dishonest, prone to engaging in deleterious policies, or both. The greater moral responsibility is not even so much for casting one’s vote a certain way, but for abrogating the independence of thought and fortitude of character needed to cast a vote based on an assessment that does not take into account what “everyone else” is doing. In other words, the moral responsibility is for allowing the pressures of social conformity to determine one’s decision even though the conformity does not entail an element of physical compulsion and the individual is fully free in theory and practice to make an entirely independent decision based on principles. In the United States, there is unfortunately a widespread entrenched mentality of supporting “the winning team” – irrespective of whether that “team’s” agenda is in one’s best interests. All too many Americans are so frightened of “losing” in any area where they have invested time and effort, that they align themselves with their very destroyers simply to avoid being in the minority.

Dr. Steele writes: Conversely, suppose instead A loses, so nothing transpires from the vote and presumably no moral responsibility attaches to the voter.  How does anything differ in these two cases, with respect to the voter’s culpability?  I can’t see that the voter has behaved differently in the two cases; shouldn’t moral responsibility be the same?  Perhaps not, but then why not?  And how would the responsibility differ in either case had the voter instead stayed home and not cast a ballot?

I respond: As a consequentialist, I do not believe that a person can have moral responsibility for hypothetical events; only actual harms count. Therefore, a person who voted for a losing candidate can have no responsibility for the decisions and actions of the winning candidate. However, voting for a losing candidate from one of the two major parties may per se be an imprudent action even if there is no moral fault arising from it – because this action shows that one continues to fall into the two-party trap and to expect a decent outcome from supporting one party or the other, despite a long train of disappointments and broken promises going back for decades.

As an analogy, consider two people who drive at extremely fast speeds on the highway. One person causes an accident, and the other does not. The second person may simply have been lucky in that his reckless behavior did not cause an accident, so I do not think that he should have any criminal or even moral culpability. The first person, on the other hand, is morally culpable because his behavior actually resulted in harm to others. However, it can be said that the second person was greatly imprudent and should improve his behavior and assumptions about the world in order to minimize the risk of causing harm in the future.

That being said, the behavior that a person exhibits while campaigning for or against a particular candidate can result in moral culpability irrespective of the outcome. For instance, the disgraceful, dishonest, and sometimes outright violent ways in which supporters of the Republican establishment have treated supporters of Ron Paul and Gary Johnson render the establishment supporters culpable no matter whether or not Mitt Romney wins the election.

As a general rule, people only have moral responsibility for their active decisions which result in harm to others. Because one part of this two-part test is contingent on external circumstances and events, it is quite possible that the same motivations and even the same physical movements by two different individuals may result in different degrees of culpability (or even culpability in one case and lack thereof in another). Furthermore, inaction, while it may be sub-optimal or even callous at times, does not rise to the level of immorality. A person who does not vote therefore cannot be held morally responsible for the actions of the winning candidate. However, he may also justifiably consider it sub-optimal or imprudent not to vote if he could have had an incremental impact in averting some of the negative consequences of the winning candidate’s victory. For instance, some libertarians believe that they should not vote because they do not want to “legitimize the system” in any way. I do not agree with their view, but adherence to it is not immoral, and libertarians of this persuasion maintain their integrity by behaving in a manner consistent with their view. However, the outcome would have been superior if these libertarians had supported Gary Johnson or Ron Paul – signaling to the establishment that the discontentment with the status quo is more widespread than originally anticipated.

Dr. Steele writes: Similarly, in every presidential election in which I’ve voted, I voted in Montana.  In none of these was the vote close enough for mine to have mattered, but that’s irrelevant.  Montana’s three electoral votes simply do not matter for the national outcome, so no matter what happened, my vote had no connection at all to what subsequently transpired.  Does this mean that I’m exempt of all moral responsibility when I vote in a presidential election?  Why or why not?

I respond: Except in extremely unlikely circumstances, no person’s single vote can make the difference in the outcome of a national election. Thus, one’s vote practically matters only to the extent of contributing to the “pool” of votes for a particular candidate. What is more important is the signal that one’s vote sends with regard to whether one is willing to morally sanction an establishment candidate or whether one is willing to voice one’s independent preferences no matter what the social or media pressures might be. Whether one votes in a “swing state” or in a state whose electoral votes are unlikely to make a difference is not so material to this question. Ultimately, one can only control one’s own behavior, and this behavior should be based on adherence to objective principles, rather than the expectation of what others faced with a similar choice are likely to do.

Dr. Steele writes: It’s clear, then, that Mr. Stolyarov is not committing the Nirvana fallacy.  But I still find his point quite problematic.  It is not always obvious what constitutes ‘incremental good/evil’ on net, or how we identify an overall reduction in liberty.  Let’s simplify this case by assuming there’s only one voter and no uncertainty about what candidates will do if elected, so that there are no disconnects between the vote cast and the political consequences.  Again, the voter faces a choice among presidential candidates, but now her/his vote determines the election and s/he knows exactly what political consequences will transpire. If A’s positions on issues X and Y reduce liberty, and his position on issue Z increases it, how is the voter to weight A’s net effect on liberty?  (Assume for sake of argument there are no other issues.)  Is A automatically disqualified because of his position on X and Y?  Or could his position on Z conceivably be sufficiently beneficial for liberty to outweigh the harm done on the first two?  I would think so, and I suspect Mr. Stolyarov agrees.  (Again, I should note that in some cases any reasonable person should be able to weigh these relative harms and benefits and get the same answer.  But in some real world cases reasonable persons might strongly differ.)

I respond: I agree that it is difficult sometimes to evaluate the net effect on liberty of an honest candidate who espouses mixed principles. For instance, if someone like Dennis Kucinich had run for President, I would be greatly concerned about most of his stances on economic policy, but I could see tremendous benefits for civil liberties (in particular, with regard to “airport security” and the misguided “War on Terror”) and foreign policy if he were elected. Which are more important? Because I so greatly care about the physical integrity of my person and property while traveling (much more than I care about my monetary holdings), I am more likely to focus significantly on the civil-liberties aspect. However, an extremely wealthy businessman (who, in this example, earned all of his wealth legitimately) might be able to afford to travel in his personal airplanes and might therefore not care as much about airport security as he does about his economic opportunities. He might justifiably weigh the benefits and costs differently than I do.

However, all of these sophisticated and reasonable discussions about how to weigh relative benefits and harms disappear when the candidate running for office is fundamentally dishonest and has a record of continually shifting his positions and violating his promises. In that case, attempting to anticipate relative benefits and harms is akin to using a wooden ruler to measure the spatial position and diameter of a tornado.

Dr. Steele writes: But also, doesn’t it matter against whom A is running?  If candidate B is worse, much worse, on all three issues, should not the voter choose A over B, regardless of whether the net outcome from A is positive?  (I would think so.) Alternatively suppose instead candidate B drops out of the race to be replaced by C, and C is superior on all three issues.  Shouldn’t that lead our voter to reverse himself and support C?

I respond: The problem with choosing A over B in a situation where both bring about incremental evils is that this concedes the premise that it is sometimes acceptable for a person to actively participate in an incremental evil, if the alternative is perceived to be even more evil. This is precisely the attitude that, when shared by sufficiently large numbers of people, allows politicians to commit evil in the first place, by creating a false dichotomy in the eyes of the people between a moderate amount of increased evil and a more significant amount of increased evil. My view is that one should compare not two hypothetical futures, but any proposed future and the status quo. If a given proposed future is a marginal improvement over the status quo, then one should support it, despite possible imperfections. However, if the status quo is superior to both of the two “mainstream” proposed futures, then one should refrain from supporting either and seek a third way. The people who vote for third parties are attempting to voice support for such a third way. The people who refuse to vote at all are, implicitly, preferring the status quo over either major candidate’s vision of the future. Either of these non-mainstream approaches is preferable to actively embracing a future that is worse than the status quo.

Dr. Steele writes: In our one voter example, suppose candidate A will take the nation slowly towards a totalitarian state, and B will take it very rapidly.  Would it not be preferable to choose A over B, to buy time for countervailing processes to act? All of these examples suggest – at least to me – that a voter might reasonably and morally vote for a candidate who will minimize damage to liberty, even if the voter has only reasonable expectation of this.”

I respond: I do have some sympathy with this argument, as – especially in a time of rapid technological advancement – enabling innovation to occur more freely for even a few years can make a tremendous difference to how free people are in practice. However, in practice, I do not see the two parties as taking us to totalitarianism at different rates. Rather, I see them as taking us toward marginally different flavors of totalitarianism at the same galloping pace. The Republican totalitarianism is more theocratic, militaristic for purposes of “national glory,” and focused on corporate cronyism toward “traditional” industries (including large financial firms). The Democratic totalitarianism is more politically correct, militaristic for purposes of “humanitarian” intervention, and focused on corporate cronyism toward “alternative” or “emerging” industries (as well as large financial firms). Both forms of totalitarianism entail extreme violations of civil liberties, though the Republican form is likely to be more targeted toward minority groups of whom many among the Republican base disapprove, while the Democratic form is likely to attempt to inconvenience and burden everybody in an egalitarian manner. Both forms of totalitarianism are fundamentally hostile to meritocracy, the enrichment of young people through economic opportunity, and small-scale technologically based institutions rising in a competitive market to replace the politically connected “legacy” institutions. Most significantly with regard to the opportunity for countervailing forces to emerge, the elites of both the Republican and Democratic parties are hostile to Internet freedom and willing to side with totalitarian guilds, such as the Recording Industry Association of America (RIAA) and Motion Picture Association of America (MPAA), to support draconian infringements on indivduals’ use of the Internet. They only subside or backtrack in their support when confronted with massive public outrage.

In this unfortunate situation of competing totalitarianisms, a valid defense of a divided government might be made. If enough friction can be introduced between the two wings of the elite, then neither wing may be able to fulfill its totalitarian vision. In some respects, this is a reason why the march to totalitarianism was slowed somewhat after the election of a Republican House of Representatives in 2010, creating a disconnect with the Democratic Senate and the Obama administration. It has certainly been more difficult for federal legislation of any sort (including the destructive sort) to be enacted in 2011-2012 than in 2009-2010.

Dr. Steele writes [regarding my strategic argument of sending a credible signal of refusing to play along with the establishment]: Maybe so.  I certainly hope so.  But note that this is a strategic argument and quite different from the argument about a voter’s moral responsibility.  I find the moral argument to be unhelpful in this discussion.”

I respond: I see the two arguments as at least somewhat interrelated, in that a voter’s perception of his moral responsibility may constrain and shape his practical choices in terms of strategy. For instance, if a person is held captive by a totalitarian regime – does he choose to appease his captors or to escape? If he believes that he has a moral responsibility not to give into his captors, then he will be more likely to plan an escape and to succeed. In the same way, it is more likely for Americans to escape the two-party trap if they believe that they have a moral responsibility to do so and set up their strategies for doing so accordingly. While the moral and strategic arguments are technically separate, embracing one may aid in the efficacy of implementing the other.

Rejecting the Purveyors of Pull: The Lessons of “Atlas Shrugged: Part II” – Article by G. Stolyarov II

Rejecting the Purveyors of Pull: The Lessons of “Atlas Shrugged: Part II” – Article by G. Stolyarov II

The New Renaissance Hat
G. Stolyarov II
October 13, 2012
******************************

Atlas Shrugged: Part II is a worthy successor to last year’s Part I, and I am hopeful for its commercial success so that John Aglialoro and Harmon Kaslow will be able to release a full trilogy and achieve the decades-long dream of bringing the entire story of Ayn Rand’s Atlas Shrugged to the movie screen. The film is enjoyable and well-paced, and it highlights important lessons for the discerning viewer. The film’s release in the month preceding the US Presidential elections, however, may give some the wrong impression: that either of the two major parties can offer anything close to a Randian alternative to the status quo. Those viewers who are also thinkers, however, will see that the film’s logical implication is that both of these false “alternatives” – Barack Obama and Mitt Romney – should be rejected decisively.

While the cast has been replaced entirely, I find the acting to have been an improvement over Part I, with the actors portraying their respective characters with more believability and emotional engagement. Samantha Mathis, in the role of Dagny Taggart, showed clearly the distress of a competent woman who is ultimately unable to keep the world from falling apart. Esai Morales aptly portrayed Francisco d’Anconia’s passion for ideas and his charisma. Jason Beghe also performed well as Hank Rearden – the embattled man of integrity struggling to hold on to his business and creations to the last.

The film emphasizes strongly the distinction between earned success – success through merit and creation – and “success” gained by means of pull. The scene in which two trains collide in the Taggart Tunnel is particularly illustrative in this respect. Kip Chalmers, the politician on his way to a pro-nationalization stump speech, attempts to get the train moving through angry phone calls to “the right people,” thinking that all will be well if he just pulls the proper strings. But the laws of reality – of physics, chemistry, and economics – are unyielding to the mere say-so of the powerful, and the mystique of pull collapses on top of the passengers.

As the world falls apart, the film depicts protesters demanding their “fair share,” holding up signs reminiscent of the “Occupy” movement of 2011 – “We are the 99.98%” is a clear allusion. Yet once the draconian Directive 10-289 is implemented, the protests turn in the other direction, away from the freedom-stifling, creativity-crushing regimentation. Perhaps the protesters are not the same people as those who called for their “fair share”  – but the film suggests that the people should be careful about the policies they ask for at the ballot box, lest they be sorely disappointed upon getting them. This caution should apply especially to those who think that Barack Obama’s administration parallels the falling-apart of the world in Atlas Shrugged – and that Mitt Romney’s election would somehow “save” America. Nothing could be further from the truth.

If there is any character in Atlas Shrugged who most resembles Mitt Romney, it is not John Galt. Rather, it is James Taggart – the businessman of pull – the sleek charlatan who will take any position, support any policy, speak any lines in order to advance his influence and power. Patrick Fabian conveyed the essence of James Taggart well – a man who succeeds based on image and not on substance, a man who has a certain polished charisma and an ability to pull the strings of politics – for a while. James Taggart is the essence of the corporatist businessman, a creature who thrives on special political privileges and barriers to entry placed in front of more capable competitors. He can buy elections and political offices – and he can, for a while, delude people by creating a magic pseudo-reality with his words. But words cannot suspend the laws of logic or economics. Ultimately the forces of intellectual and moral decay unleashed by corporatist maneuvering inexorably push the world into a condition that even the purveyors of pull would have preferred to avoid. As Ludwig von Mises pointed out, the consequences of economic interventionism are often undesirable even from the standpoint of those who advocated the interventions in the first place. James Taggart is ultimately pushed into accepting Directive 10-289, though his initial plans were much more modest – mostly, a desire to hang onto leadership in the railroad business despite his obvious lack of qualifications for the position. Mitt Romney, by advocating James Taggart’s exact sort of crony corporatism, may well usher in a similar overarching totalitarianism – not because he supports it now (in the sense that Mitt Romney can be said to support anything), but because totalitarianism will be the logical outcome of his policies.

Because, in some respects, Ayn Rand wrote during a gentler time with respect to civil liberties, and the film endeavors to consistently reflect Rand’s emphasis on economic regimentation, there is little focus on the kinds of draconian civil-liberties violations that Americans face today. The real-world version of Directive 10-289 is not a single innovation-stopping decree, but an agglomeration of routine humiliations and outright exercises of violence. The groping and virtual strip-searching by the Transportation Security Administration, the War on Drugs and its accompanying no-knock raids, the paranoid surveillance apparatus of large-scale wiretaps and data interception, and the looming threat of controls over the Internet and indefinite detention without charge – these perils are as damaging as an overarching economic central plan, and they are with us today. While not even the most socialistic or fascistic politicians today would issue a ban on all new technology or a comprehensive freeze of prices and wages, they certainly can and will try to humiliate and physically threaten millions of completely peaceful, innocent Americans who try to innovate and earn an honest living. Obama’s administration has engaged in this sort of mass demoralization ever since the foiled “underwear” bomb plot during Christmas 2009 – but Romney would do more of the same, and perhaps worse. Unlike Obama, who must contend with the pro-civil-liberties wing of his constituency, Romney’s attempts to violate personal freedoms will only be cheered on by the militaristic, jingoistic, security-obsessed faction that is increasingly coming to control the discourse of the Republican Party. There can be no hope for freedom, or for the dignity of an ordinary traveler, employee, or thinker, if Romney is elected.

I encourage the viewers of the film to seriously consider the question, “Who is John Galt?” He is not a Republican. If any man comes close, it is Gary Johnson, a principled libertarian who has shown in practice (not just in rhetoric) his ability and willingness to cut wasteful interventions, balance budgets, and protect civil liberties during two terms as Governor of New Mexico. He staunchly champions personal freedoms, tax reduction, foreign-policy non-interventionism, and a sound currency free of the Federal Reserve system. Gary Johnson was, in fact, a businessman of the Randian ethos – who started as a door-to-door handyman and grew from scratch an enterprise with revenues of $38 million.  And, on top of it all, he is a triathlete and ultramarathon runner who climbed Mount Everest in 2003 – clearly demonstrating a degree of ambition, drive, and pride in achievement worthy of a hero of Atlas Shrugged.

Ayn Rand never meant the strike in Atlas Shrugged to be an actual recommendation for how to address the world’s problems. Rather, the strike was an illustration of what would happen if the world was deprived of its best and brightest – the creators and innovators who, despite all obstacles, pursue the path of merit and achievement rather than pull and artificial privilege. Today, it is necessary for each of us to work to keep the motor of the world going by not allowing the purveyors of pull to gain any additional ground. Voting for Mitt Romney will do just the opposite – as Atlas Shrugged: Part II artfully suggests to the discerning viewer.