Economics

Immigration Points and the Fatal Conceit of Central Planning

(Please excuse the improper spacing in this piece. Weird glitch. Don’t know how to fix it.)

If you think Trump’s (or Canada’s or whatnot’s) points system for immigration is a good idea, you seem awfully confident in the government’s ability to engage in central planning.

 

Now, Trump is a mercantilist with little understanding of economics. But to my surprise, quite a few libertarians and supposed “free market economic conservatives” seem on board with his points plan. But here’s the problem:
Most of you recognize government is too stupid to plan shoe production. You need price signals and competitive mechanisms to tell you what, where, and how to produce. You can’t make a five-year plan for the whole economy because the economic problem constantly changes.

But many people who recognize that flip around say, “Oh, but no worries. We can figure out exactly how many and what kind of laborers the economy needs for the next five years using this artificial points scale.”

 

The best way to know whether “the economy needs an immigrant” is simple: If we allow people to hire the immigrant, do they choose to do so? If we allow people to rent houses or apartments to the immigrant, do they choose to do so? Let them do it, sit back, and let the market do its thing.

Now, granted, the government may have a legitimate worry about being able to afford certain kinds of welfare programs and publicly provided goods which immigrants might consume. But if that’s a worry, then find a keyhole solution. We don’t nationalize guitar production just because we worry about affording public schools for luthiers’ kids; similarly, we shouldn’t nationalize laborer production because of that worry.
Now, if you think the system improves upon the status quo, that’s fine. That’s not an argument that the system is good, just that’s better than what we had before.
Academic Philosophy

The Bourgeois Argument for Freer Immigration

Donald Trump wants to make immigration merit-based. While many people will reject that view on a variety of grounds, some nonetheless think that admitting educated, wealthier persons is preferable to admitting folks who will take low-end jobs.

This idea, however, is mistaken for empirical and moral reasons. Educated middle-class immigrants are not the only ones that create wealth. The economies of California and Arizona, for example, are literally sustained by millions of immigrants who perform low-paid, low-level jobs in farms, restaurants, and factories. Immigrants who take low-end jobs are as beneficial to the United States as those who take high-end jobs. I suppose the numbers are too complicated to compare the benefits of each class, but I have little doubt that the immigrants the president wants to exclude create great wealth (the White House says they receive state benefits, but it does not say that the wealth they create outweighs those costs.)

In addition to these well-known economic reasons, there are moral reasons to reject merit (high education, wealth, and so on) as a basis for immigration. One is this: The state should liberally admit immigrants because they are entitled to better themselves by trading their skills and entrepreneurship with willing trading partners across the border. Those skills may be specialized or non-specialized; the principle applies to all migrants willing and able to work. I borrow the underlying principle, the ethics of trade-tested betterment, from Deirdre McCloskey, who developed it recently (albeit as a historical, not normative, thesis) in her massive volume Bourgeois Equality. She calls it the bourgeois ethics, and for that reason I call my thesis the Bourgeois Argument for immigration. (This post summarizes my contribution to an upcoming volume by CUP, The Future of Classical Liberalism, edited by Todd Henderson).

The idea is that persons who seek to better themselves by offering their labor or entrepreneurship to willing buyers across borders should be accorded the same dignity and respect to do so that natives enjoy. The argument is consistent with, though not reducible to, two standard pro-immigration arguments: the recognition of migrants’ right to free mobility, and the recognition of the immense economic benefits of immigration. McCloskey argues that the enormous jump in global prosperity (the Great Enrichment) between sometime in the early- or mid-eighteenth century to the present day was caused, not by technological advancement or the establishment of property rights, but by a Gestaltic change of ideas originated in Northwestern Europe. She argues, first, that contrary to the conventional wisdom advanced by the intellectual and artistic elite (which she calls the “clerisy”), the middle-class of traders, inventors, and managers, far from being selfishly materialistic, was much more ethical than its critics recognized, and has been so for much of human history. For McCloskey, a radical change in social mores was the real cause of the Great Enrichment. This novel ethical outlook is simply the recognition of a new liberty and dignity of commoners and the activity on which they specialized: the ethics of trade-tested betterment.

I adopt McCloskey’s idea with three friendly amendments. First, I treat the bourgeois ethics as a normative principle, and not just as a historical ethical development that had enormous beneficial consequences (although I largely agree with McCloskey’s account.) The bourgeois ethics is, I think, a proper way to treat others above and beyond whatever relational bonds (compatriots, friends, family) we may have with them. Respecting their right to better themselves through trade is a special case of according them dignity and respect. Second, borrowing the bourgeois ethics does not commit me to accept McCloskey’s controversial claim that institutions had a minor role in the improvement of people’s lives around the globe. I suspect (but will not argue here) that McCloskey exaggerates the differences between her approach and that of institutionalists like Acemoglu and Robinson. Be that as it may, my argument here is ethical, not historical, so I don’t need to take sides in that dispute. And finally, I extend the Bourgeois Argument to immigrants. McCloskey, I think, is content to describe the surge of the bourgeois ethics within nations. It is entirely unclear that those who promoted and practiced the bourgeois ethics were thinking of elevating foreigners to the equal treatment that local traders now enjoyed.

The Bourgeois Argument, I said, is a special case of a principle that mandates treating others with dignity and respect, which means treating them as rational free agents. But the literature offers divergent interpretations of the principle. Ronald Dworkin, for example, thinks that the state has a duty to treat everyone with dignity and respect, and that the way to do this is to erase the unfair effects of citizens’ differing starting points. A redistributive tax policy secures to people the material benefits that erases such unfairness and allows them to pursue their life plans with chances of success. Whatever the other merits of this approach, it treats persons as passive beneficiaries of the transfer of resources. As such, the state’s benefits cannot in itself embody respect for the beneficiaries, since such transfer has at best an indirect relationship with the beneficiaries’ agency, dignity, or autonomy. The thought is that, thanks to the benefit, the beneficiaries’ prospect will be equalized, as it were, and they will eventually be capable of functioning as productive members of society.

In contrast, the bourgeois ethics sees persons as agents, as masters of their own destinies. Instead of payments, individuals receive the recognition of their agency and the encouragement to offer their skills in the market to better themselves and their families. The bourgeois ethics sees persons, not as passive beneficiaries, but as active agents. In contrast to Dworkin’s view, the Bourgeois argument emphasizes ethical equality: the equal freedom of every person, native or not, to offer their skills and talents in the market. For that reason, the bourgeois ethics is, I believe, closer to the core notions of dignity and respect than mainstream egalitarian ethics. It encourages persons to work and innovate, and it discourages resentment and misplaced feelings of entitlement. If McCloskey is right that the bourgeois ethics has been a main factor in global prosperity even with relatively closed borders, then affirming the Bourgeois Argument for immigration portends even greater things to come. This is where the Bourgeois Argument nicely dovetails with the economic findings on immigration. Recognizing the migrants right to better themselves through trade is the right thing to do, and it is also a sure recipe for significant (indeed, massive) increase in prosperity and the corresponding alleviation of poverty.

The bourgeois ethic replaced the old hierarchical ethic that forced traders to remain in their assigned social places. Joseph Carens defends open borders by pointing out that immigrant status is “the modern equivalent of the feudal class privilege.” A person who has immigrant status lacks standing to better herself through trade with the natives. Immigration status means denial of bourgeois status in McCloskey’s sense and it is in that sense, as Carens suggests, a remnant of the feudal hierarchical ethic. Notice that this objection is different from the luck-egalitarian objection given by progressive supporters of freer immigration. The luck-egalitarian argument for free immigration is that someone born in a poor country does not deserve such fate, and therefore immigration controls should be relaxed to undo the arbitrariness of persons’ having been born there rather than here. I do not pass judgment on this argument, although I am generally skeptical of luck egalitarianism. Here I simply notice that the inequality created by immigration laws is a legal inequality, not an inequality caused by the accident of birth. This is why the luck-egalitarian argument is not needed to condemn these laws.  The immigrant’s access  is denied him by armed guards at the border.   It is not that we should grant him access to nullify accidents of birth. Maybe that consideration applies, maybe not, depending on one’s evaluation of luck egalitarianism as the basis of a sound political theory. But regardless, surely every liberal, progressive or classical, will agree that coercively enforced inequality is presumptively wrong.

 

Current Events

The Rhetoric of Libertarians and the Unfortunate Appeal to the Alt-Right

One of my most clicked-on posts here at BHL was this one on Ron Paul’s newsletters and why they still mattered 20 years after they were published. In that piece, I asked the following questions about the way in which racist organizations like Stormfront found Paul worthy of their support:

Even if Ron had never intentionally courted them, isn’t it a huge problem that they think he is a good candidate?  Doesn’t that say something really bad about the way Ron Paul is communicating his message?  Doesn’t it suggest that years of the paleo strategy of courting folks like that actually resonated with the worst of the right?

That was 2011, before the term “alt-right” was in currency and certainly well before the Trump candidacy dramatically reduced the stigma associated with public expressions of nativism, racism, and anti-Semitism.

The paleo-libertarian seed that Ron Paul, Murray Rothbard, and Lew Rockwell planted in the 1990s has come to bear some really ugly fruit in the last couple of years as elements of the alt-right have made appearances in various libertarian organizations and venues. Back in February, alt-right hero Richard Spencer stirred up a fuss at the International Students for Liberty Conference in DC after being invited to hang out by a group of students calling themselves the “Hoppe Caucus.” Hans-Hermann Hoppe, long associated with the Ludwig von Mises Institute as well as a panoply of racists and anti-Semites, is perhaps the most popular gateway drug for the alt-right incursion into libertarianism.

And within the last couple of weeks, Jeff Deist, president of the Mises Institute delivered a talk to students at Mises University entitled “For a New Libertarian.” In that talk, he knocks down an extended strawman of what he thinks constitutes the libertarianism he wants them to reject – what many might call “left-libertarianism,” including, I suspect, many of us here at BHL. For example:

Because while libertarians enthusiastically embrace markets, they have for decades made the disastrous mistake of appearing hostile to family, to religion, to tradition, to culture, and to civic or social institution — in other words, hostile to civil society itself.

Most controversially, Deist, after continuing to argue that family, faith, and the like are the cultural glue that humans need and that libertarians should focus on, decided to end with:

In other words, blood and soil and God and nation still matter to people. Libertarians ignore this at the risk of irrelevance.

For those who know something about the history of the 20th century, the invocation of “blood and soil” as something that libertarians should recognize as a valid concern and should appeal to should be chilling. That phrase, which has a history going back at least to the 19th century, was central to the Nazi movement and was at the core of their justification for eliminating those people who did not have connections to the German homeland. It remains a watchword of the nastiest elements on the right, as a quick visit to bloodandsoil.org will demonstrate, if your stomach can handle it. That phrase, whatever Deist’s intent, would be very attractive to many among the alt-right, including neo-Nazis and other racists and anti-Semites. One click on the Blood and Soil website above will make that appeal abundantly clear.

Perhaps Deist didn’t know all of that. If so, one would expect a decent person to immediately apologize for using that phrase that way in that context. To my knowledge, no such apology has appeared. On the assumption that he is not, in fact, a Nazi, the explanation left standing is that he and his defenders have no problem using rhetoric that will attract those sympathetic to Nazi-like views about nativism and Jews. It’s that lack of concern about engaging in that sort of rhetoric, if not a positive willingness to do so, that is so troubling here, and it is eating away at the liberal roots of libertarianism.

If I may add a personal note for a moment: I have been in the middle of several Facebook debates over that phrase and Deist’s talk, and I’ve taken quite a bit of abuse from fans of the Mises Institute. Let me take this opportunity to clarify what I did and did not say. Contrary to the assertion many are making, I did not call Deist or people associated with the Institute “Nazis.” None of my Facebook posts did that, nor can I find a comment where I said as much. If I did, I will happily apologize as I do not think Deist is a Nazi.

What I did say is the same point I made about the Ron Paul newsletters: the problem with Deist’s talk, and the Mises Institute more generally, is not that they are Nazis, but that they appear to have no problem with making arguments that are appealing to neo-Nazis and the rest of the unsavory elements of the right. That’s the problem here. Why would supposed libertarians want to engage in a strategy and make use of rhetoric that is clearly a signal to those folks? That’s the same question I asked 6 years ago and matters have only become worse since then.

It’s also amusing that I have become the poster boy for the libertine, universalist libertarianism that they attack, for at least two reasons. First, name a libertarian who has written more about the family and its importance for a free society than I have. My book is explicitly a “non-conservative defense of the family.” For the kind of libertarian who is supposedly hostile to family, I sure spend a lot of time writing professionally about how great it is.

And second, again with apologies for the personal stuff, for the kind of libertarian who supposedly doesn’t care about religion or civil society, I sure do spend a lot of time doing volunteer work for synagogues and schools. I was on the board of my local synagogue in New York for a decade, most of which was as Treasurer. My ex-wife and I were heads of the parents group for the music department at the local school for several years. Sarah and I are deeply involved with our synagogue here in Indianapolis. I’m not about to put my tax returns up on the web, but I’m confident that I give at least as much of my time and money to family, religion, culture, and civil society as do any of the folks who nodded along with Deist’s argument.

As I pointed out with the Paul newsletters, all of this appeal to nativism, racism, and anti-Semitism and the like is in deep conflict with libertarianism’s liberalism. It’s particularly in conflict with the liberal cosmopolitanism of someone like Mises. And the use of Nazi language is especially galling as it was the very “blood and soil” crowd who drove the Jewish Mises out of Vienna.

Instead of this sort of nonsense, we need to recapture libertarianism’s progressive roots in the liberal movement of the 19th century. I put it this way in 2011:

What we need right now is Rothbard’s vision of a free society as sketched in For a New Liberty, but we need it defended better.  More carefully.  More richly.  More empirically.  More humanely. More progressively.  More tolerantly. With better scholarship.  And we have to do it in a way that’s immune to the charge that libertarians don’t care about making the world a better place, especially for the least well off and those historically victimized by the color of their skin, their gender, their sexual orientation, or anything else that’s irrelevant to their moral status as human actors.

The writings of the paleolibertarians will continue to stain that project unless and until the rest of the libertarian movement stops trying to apologize for them…

Our history is one of liberal tolerance, universalism, and cosmopolitanism, putting the freedom and harmony of all people ahead of the supposed interests of any parochial sub-group, and especially ones defined by the artificial boundaries of nation-states and their subsets. Libertarians ignore this at the risk of irrelevance.

Finally, one of the most disturbing side aspects of the controversy over Deist’s speech that it revealed how little so many young libertarians know about the Nazis and the Holocaust. I suppose I can understand ignorance of the “blood and soil” reference, but what troubled me more was when I made a joke involving the phrase “work shall set you free” and several commenters had no idea where that phrase came from or why any positive spin on it (as Deist did with “blood and soil”) should be so troubling. Holocaust ignorance is a real problem. And to the degree that young people are attracted to the alt-right out of ignorance rather than pure hatred, combating that ignorance can also serve the purpose of resisting the alt-right incursion into libertarianism.

Because I believe in education, religion, and the importance of the institutions of civil society, and because I believe in putting my money where my mouth is, Sarah and I recently made a donation to the Birmingham (AL) Holocaust Education Center. We made our donation as a tribute to Ludwig von Mises. I invite my fellow bloggers and all of our commenters who share my concerns to consider doing the same. You don’t have to list Professor Mises’s address as the address of the Mises Institute as we did, but you might also consider doing that as an additional touch.

Democracy

Hutt on Constitutional Constraints as Protection for the Politically Weak

Nancy MacLean’s Democracy in Chains has been the gift that keeps on giving. Rather than pile on yet another specific error in the book, I want to briefly address one of the overall themes through a specific thinker and context she raises.

As co-blogger Mike has pointed out, MacLean is an unreconstructed majoritarian throughout the book. The whole problem with public choice is that it wanted to place democratic majorities in chains. She is unwavering in her commitment to that claim. As many have noted, myself included, it’s a strange position to take for a progressive who presumably supports the Supreme Court decisions in Brown, Loving, Roe, and Obergefell, all of which overturned the work of democratic majorities in a large number of states.

MacLean also charges public choice with racism, as she sees its desire to chain those majorities as a way of locking in the privileges of the rich, white, elite by denying the progressive forces of history on the side of the majority from creating the policies and institutions they wish to. She also argued that the context of 1960s Virginia was one in which it was easy for Buchanan and others to signal that racism in subtle ways, hence the way she sees his argument for competition in schooling as opposition to Brown.

At one point, she invokes Buchanan’s invitation to the South African economist W. H. Hutt to spend the 1965-66 academic year at UVA as evidence for her broad thesis by pointing to Hutt’s work that was critical of unions. She sees this as evidence of Buchanan’s defense of the privileges of wealth. What she fails to note, as several others have pointed out, was that Hutt was a vocal and early critic of apartheid and compared it to the segregation in the US south. And part of his criticism of unions was the role that white unions had played in both privately coercing black workers in South Africa and then using the power of the state to put apartheid into law. If Buchanan was really such a racist and defender of segregation, why would he invite Hutt and have him speak on those issues?

During the winter he was at UVA, Hutt published an article entitled “South Africa’s Salvation in Classic Liberalism” in Il Politico (Vol. 30, No. 4, December, pp. 782-795). What’s particularly interesting in light of MacLean is this paragraph where he discusses the origins of apartheid (emphasis mine):

But very soon in the development of the mining industry, fears began to arise that the Africans might one day claim the right to perform many of the tasks which had hitherto been the preserve of the Whites. It is hardly surprising that, in the early years of the present century, the full strength of the white labour union movement came to be used to check a gradual dissolution of customary obstacles to African employment in work involving skill or responsibility. By means of violent strikes, the labour unions demonstrated the private coercive power which the State had allowed them to acquire. The white miners formed an important portion of the electorate; and far from the State taking steps to suppress private coercion, before long it substituted its own coercion for that of the labour union, through the Mines and Works Act of 1911. Known as the first “Colour Bar Act”, it was the first to embody explicitly the principle which has recently become known as “job reservation.” It illustrates, therefore, (a) what the “classic liberal” must regard as the reprehensible passivity of the State when confronted with private coercion by a politically favoured group, and (b) the tendency of the State to discriminate directly in favour of the politically strong (whether majorities or minorities) in the absence of effective constitutional restraints.

What’s worth noting here is that Hutt’s case for constitutional constraints is that they prevent the powerful from preying on the weak, which is precisely the opposite of MacLean’s view. What enabled the powerful whites in South Africa to use the state to oppress the blacks was not the existence of constitutional constraints but their absence. In both of his final observations there, Hutt takes the side of the politically weaker and oppressed blacks against the powerful whites. This is certainly not the picture of libertarianism that MacLean draws in her discussion of Buchanan, public choice, and the Koch brothers.

This is the scholar Buchanan chose to visit UVA in the mid-1960s: a long-time opponent of apartheid who had been hounded for his views and who understood that public choice was an effective tool to prevent the exploitation of the politically weak by the politically powerful. This perspective is consistent with public choice’s description of the role of constitutional rules and Buchanan’s life-long commitment to a world without discrimination or domination.

Nancy MacLean’s overarching narrative of public choice’s call for constitutional constraints as a road map for the powerful to acquire and maintain power over the powerless gets matters completely backward. Hutt’s invitation to Buchanan’s Jefferson Center and the talks he gave and the papers he published while there are further evidence of her complete misreading of her subject matter.

Academic Philosophy

Chris Freiman’s Unequivocal Justice

Christopher Freiman  has just published a fabulous book, Unequivocal Justice, the first book in Routledge Press’s new “Political Philosophy for the Real World” series.

It is a tour de force of philosophical excellence. It may well be the best book of political philosophy published in 2017. I certainly haven’t read anything this year that comes close to competing with it.

Imagine a person said, “I have a solution to the problem of drunk driving. However, my solution works only in a world where alcohol hadn’t been invented.” There’s something deeply silly and incoherent about that.

Well, it turns out that the mainstream of political philosophy over the past 50 years has precisely this problem. The mainline of political philosophy, when it tries to defend or critique various institutions, has largely been a joke, Freiman shows us, though he’s too polite to put it that bluntly.

What Freiman shows is that Rawls, Freeman, Ackerman, Dworkin, and a number of other left-liberal philosophers are making this kind of mistake over and over. His critique is so devastating that you might as well take Rawls’s writings about institutions and throw them in the trash; they are now, thanks to Chris, nothing more than artifacts of historical interest.

Chris starts by saying,

A perfect state is a pointless state.

The point of a state is to mitigate injustice. If Rich would donate his 40% to the poor, the state wouldn’t need to tax his income. If Mimi would buy a hybrid instead of a Hummer, the state wouldn’t need to cap her emissions. But since virtue alone won’t do the job, the state needs to redistribute equitably and regulate efficiently.

…But here’s the problem: the very reasons why the state is needed are reasons why the state won’t work.

 

Rawls writes mostly at the level of ideal theory. But, Freiman shows, an ideal theory of the state is incoherent. (Yes, he responds to Kavka’s argument otherwise.) Under ideal conditions–in which people are stipulated to comply fully with the requirements of morality and justice–there simply is no need for a state, period. There is no need to create an institution which claims a monopoly on violence and which enforces rules through threats of violence. Ideal theory must be anarchist.

Coercion is needed to defend justice only when society is less than fully just. But when society is less than fully just, we cannot stipulate the ideal justness of the state itself. So we arrive at the dilemma for ideal theories of the state: either (i) society is fully just, in which case there is no need for a state, or (ii) society is not fully just, in which we case we may not stipulate the state itself is just.

In order to create a need for a state, Rawls (and his followers) equivocate. They posit bad behavior in the private sector. But then, in order to defend their favored regime and in order to avoid the criticism that the regime itself might be corrupt and make things worse, they imagine away all bad behavior in the public sphere.

For example, Rawls claims that we need to equalize incomes in order to prevent the rich from buying power for themselves. (Freiman thinks that’s a weird argument to begin with; in order to stop people from polluting, we don’t equalize income; rather we regulate pollution.) But here’s the dilemma.

…The only way to ground both (i) the need for regulation and (ii) the stipulation of the regulation’s success is to equivocate in precisely the way Rawls does.

So, to restore consistency, Rawls needs to resolve a dilemma: Either (i) the rich aren’t buying up state power, in which case equalization isn’t necessary, or (ii) the rich are buying up state power, in which case they can subvert equalization by buying up the state power unleashed to do the equalizing. Neither option justifies an a priori demand for equalization.

A few other philosophers, including G. A. Cohen and me, have pointed out that Rawls makes cartoonishly bad arguments like this here and there. But Freiman methodically goes through Rawls and a few others, and finds they make such arguments constantly. Rawls’s version of the public goods argument, his argument for redistribution taxation, his argument for the existence of the state, and so on, all have the same form: He’s giving us a theory about how to solve drunk driving, but his solution can only be stipulated to work in a world where alcohol had never been invented.

In the end, the mistake is that Rawls is trying to make a priori arguments for institutions, regime-types, and rules. These arguments all fail. They are no substitute for doing careful PPE-style empirical institutional analysis. Freiman closes by warning left-liberals not just to presume that empirical analysis will vindicate the exact institutions they were defending on entirely a priori grounds.

Again, the book is a tour-de-force. You should read it. It will make you a better thinker.

Here’s my blurb for the book:

Unequivocal Justice, with its delightful and engaging prose, is a devastating critique of the dominant arguments and methods in political philosophy. It shows that almost everything Rawls and other left-liberals have said about institutions over the past 50 years is not merely wrong, but incoherent. It should–if philosophers have an intellectual integrity–change the field forever.

Strong words, but entirely deserved.