Factual Free-Market Fairness

By On June 16, 2012 · 404 Comments · In Economics, Liberalism, Symposium on Free Market Fairness

[Editor's Note: This essay is part of a symposium on John Tomasi's Free Market Fairness. For an introduction to the symposium, click here. For a list of all posts in the symposium, click here.]

To a discussion by political philosophers a mere fact woman like me, an economic historian trained in the 1960s as a transportation economist, has really only one thing to contribute.  It is, to slightly modify Cromwell’s imprecation to the Scottish Presbyterians in 1650, “I beseech you, in the bowels of Christ, think it possible that you may be [factually] mistaken.”

Factually.  I realize that Kant laid it down that what humans are factually like, or what their history factually was, is forbidden to play a part in ethical reflection.  We are supposed to be looking for principles that any Rational Creature would adhere to, whether a six-headed being in outer space or the man on the Clapham omnibus.  As an economist I can see the charm in assuming a character Max U, or Rational R, and then proceeding.  And I know that most social psychologists (I except among the younger generation Jonathan Haidt, for example, or, Mike Csíkszentmiháyli of my generation, or Jerome Bruner of an earlier generation) find it charming to believe that ethics starts with their own earliest experiments.  Such models and experiments are a lot simpler than reflecting in addition on art and literature and philosophy since the Rig Veda and the Epic of Gilgamesh.  But the modern cleverness after Hobbes and then Kant and Bentham and now with the fierce modernists of freakonomics and hedonic measurement seems less relevant to human experience—which is after all why we would want an ethical theory in the first place—than the virtue-talk of the ages.  We can’t, and shouldn’t, stop being humans, who were once children, and will die, and who reason and love and hope in human ways.  As Will Wilkinson puts it, “if hammered into reflective equilibrium with the help of clever thought experiments and modeling assumptions” of the political philosophers since Hobbes, we nonetheless, and even (Will observes) in the very rules of our reflections, “are also going to be, to a very large extent, creatures of our environment.”  Kant’s decision to omit anthropology (which he in fact taught every Saturday in term) was a human and rhetorical choice, not written in the starry heavens.

So: I’m from economics and history, and I’m here to help you.  In the factual background assumed in the elegant contributions here by Elizabeth Anderson and Samuel Freeman there’s a very particular story (less so in Richard Arneson and not at all in Wilkinson), embodied since the late nineteenth century in what Tomasi calls High Liberalism.  The High-Liberal political philosophers such as Anderson and Freeman and Dworkin and Nussbaum rely, against Kant, on a factual story which they take to be so obvious as to not require defense.  I claim that on the contrary their master narrative is mistaken, as anthropology or economics or history.  You can hear versions of it every night on MSNBC (you can hear other mistaken master narratives on Fox News, so understand I am not recommending that). 

The story is, in a few brief mottos to stand for a rich intellectual tradition since the 1880s:  Modern life is complicated, and so we need government to regulate.  Government can do so well, and will not be regularly corrupted.  Since markets fail very frequently the government should step in to fix them.  Without a big government ee cannot do certain noble things (Hoover Dam, the Interstates, NASA).  Antitrust works.  Businesses will exploit workers if government regulation and union contracts do not intervene.  Unions got us the 40-hour week.  Poor people are better off chiefly because of big government and unions.  The USA was never laissez faire.  Internal improvements were a good idea, and governmental from the start.  Profit is not a good guide.  Consumers are usually misled.  Advertising is bad.

Thus Anderson: ”Externalities, asymmetrical information, and other collective action problems are . . . pervasive in economic life.  Countless ways of conducting business reap gains for some while imposing unjust costs on others.  Create a cartel.  Stuff rat feces in sausages.”  Thus Freeman: “It is a truism to say that in order to achieve the benefits of an efficient market economy (increasing productivity, greater economic output, increasing productive capital, etc.), the basic rules of property, contract, and exchange must be structured [by government] to realize efficient market relations.”

No.  The master narrative of High Liberalism is mistaken factually.  Externalities do not imply that a government can do better.  Publicity does better than inspectors in restraining the alleged desire of businesspeople to poison their customers.  Efficiency is not the chief merit of a market economy: innovation is.  Rules arose in merchant courts and Quaker fixed prices long before governments started enforcing them.

I know such replies will be met with indignation.  But think it possible you may be mistaken, and that merely because an historical or economic premise is embedded in front page stories in the New York Times does not make them sound as social science.  It seems to me that a political philosophy based on fairy tales about what happened in history or what humans are like is going to be less than useless.  It is going to be mischievous.

How do I know that my narrative is better than yours?  The experiments of the 20th century told me so.  It would have been hard to know the wisdom of Friedrich Hayek or Milton Friedman or Matt Ridley or Deirdre McCloskey in August of 1914, before the experiments in large government were well begun.  But anyone who after the 20th century still thinks that thoroughgoing socialism, nationalism, imperialism, mobilization, central planning, regulation, zoning, price controls, tax policy, labor unions, business cartels, government spending, intrusive policing, adventurism in foreign policy, faith in entangling religion and politics, or most of the other thoroughgoing 19th-century proposals for governmental action are still neat, harmless ideas for improving our lives is not paying attention.

In the 19th and 20th centuries ordinary Europeans were hurt, not helped, by their colonial empires.  Economic growth in Russia was slowed, not accelerated, by Soviet central planning.  American Progressive regulation and its European anticipations protected monopolies of transportation like railways and protected monopolies of retailing like High-Street shops and protected monopolies of professional services like medicine, not the consumers.  “Protective” legislation in the United States and “family-wage” legislation in Europe subordinated women.  State-armed psychiatrists in America jailed homosexuals, and in Russia jailed democrats.  Some of the New Deal prevented rather than aided America’s recovery from the Great Depression.

Unions raised wages for plumbers and auto workers but reduced wages for the non-unionized.  Minimum wages protected union jobs but made the poor unemployable.  Building codes sometimes kept buildings from falling or burning down but always gave steady work to well-connected carpenters and electricians and made housing more expensive for the poor.  Zoning and planning permission has protected rich landlords rather than helping the poor.  Rent control makes the poor and the mentally ill unhousable, because no one will build inexpensive housing when it is forced by law to be expensive.  The sane and the already-rich get the rent-controlled apartments and the fancy townhouses in once-poor neighborhoods.

Regulation of electricity hurt householders by raising electricity costs, as did the ban on nuclear power.  The Securities Exchange Commission did not help small investors.  Federal deposit insurance made banks careless with depositors’ money.  The conservation movement in the Western U. S. enriched ranchers who used federal lands for grazing and enriched lumber companies who used federal lands for clear cutting.  American and other attempts at prohibiting trade in recreational drugs resulted in higher drug consumption and the destruction of inner cities and the incarcerations of millions of young men.  Governments have outlawed needle exchanges and condom advertising, and denied the existence of AIDS.

Germany’s economic Lebensraum was obtained in the end by the private arts of peace, not by the public arts of war.  The lasting East Asian Co-prosperity Sphere was built by Japanese men in business suits, not in dive bombers.  Europe recovered after its two 20th-century civil wars mainly through its own efforts of labor and investment, not mainly through government-to-government charity such as Herbert Hoover’s Commission or George Marshall’s Plan.  Government-to-government foreign aid to the Third World has enriched tyrants, not helped the poor.

The importation of socialism into the Third World, even in the relatively non-violent form of Congress-Party Fabian-Gandhism, unintentionally stifled growth, enriched large industrialists, and kept the people poor.  Malthusian theories hatched in the West were put into practice by India and especially China, resulting in millions of missing girls.  The capitalist-sponsored Green Revolution of dwarf hybrids was opposed by green politicians the world around, but has made places like India self-sufficient in grains.  State power in many parts of sub-Saharan Africa has been used to tax the majority of farmers in aid of the president’s cousins and a minority of urban bureaucrats.  State power in many parts of Latin America has prevented land reform and sponsored disappearances.  State ownership of oil in Nigeria and Mexico and Iraq was used to support the party in power, benefiting the people not at all.  Arab men have been kept poor, not bettered, by using state power to deny education and driver’s licenses to Arab women.  The seizure of governments by the clergy has corrupted religions and ruined economies.  The seizure of governments by the military has corrupted armies and ruined economies.

Industrial policy, from Japan to France, has propped up failing industries such as agriculture and small-scale retailing, instead of choosing winners.  Regulation of dismissal has led to high unemployment in Germany and Denmark, and especially in Spain and South Africa.  In the 1960s the public-housing high-rises in the West inspired by Le Courbusier condemned the poor in Rome and Paris and Chicago to holding pens.  In the 1970s, the full-scale socialism of the East ruined the environment.  In the 2000s, the “millennial collectivists,” Red, Green, or Communitarian, oppose a globalization that helps the poor but threatens trade union officials, crony capitalists, and the careers of people in Western non-governmental organizations.

Yes, I know, you want to reject all these factual findings because they are “right-wing” or “libertarian.”  All I ask you to do is, once in a while, consider.  Don’t believe everything you read in the papers.

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  • Brian

    Where is the evidence that all your claims here are “factual”?  This seems a rather fact-free post!

    • Mark Pennington

      The evidence is documented in considerable detail in Deirdre’s books – The Bourgeois Virtues, and Bourgeois Dignity. The point she is making is that contributions like those of Anderson to this symposium don’t even bother to consider such evidence – or if they do and they  disagree with it to set out the reasons why. They prefer instead to resort to Arneson’s tactic – contenting  themselves with assertions that any empirical claims for classical liberalism are just ‘right wing’ rhetoric .

      • Brian

        It would be surprising if her books could really support many of the claims here, some of which are obviously controversial, many of which are just silly. But the real point is someone who arrives on the scene with a high-handed lecture about facts should adduce actual evidence, with support, not just regurgitate the dogmas of the pseudo-science of Chicago School economics.

        • Deirdre McCloskey

          Dear Brian,
          Name a single “silly” one and, in accord with your own impossible standard, tell me the evidence against it: you get one sentence to do so. That you are willing to use such a word as “silly” makes my point: that you have not considered, in the bowels of Christ or of anyone else, the possibility that your factual assumptions about what happened in history or how the economy works mght be mistaken. You move instead to personal abuse. It is the sign of an ill-stocked mind.
          Your sneer at Chicago School economics is more of the same. Do you actually know what you are talking about? I was for 12 years on the faculty there, and disagreed with many of my colleagues on many issues. But there were more real economic scientists at Chicago 1968-1980 than anywhere else I have encountered.
          You do not appear to have looked into the evidence for your prejudices. Some of them might prove to be correct, even. It would be good for your soul to do the homework. Then you would be entitled even to some sneering. It is called scholarship and science. Give it a try.
          Sincerely,
          Deirdre McCloskey

          • Brian

            (1) “Minimum wages protected union jobs but made the poor unemployable.” As you know this is contested by lots of other “economic scientists.” So it is silly to assert this as though it is as well-established as the Second Law of Thermodynamics.
            (2) Accusing me of having “an ill-stockied mind” is an example of “personal abuse.” So too is suggesting that I need to give “scholarship and science” a “try.” I simply said some of your claims were silly, and all of them were undocumented.
            (3) I teach at the University of Chicago, and some of my good friends are economists. I admire their smarts and their willingness to pursue an intellectual agenda carefully and systematically. But economics is not a “science” in any sense that would accord epistemic credence to its claims. Alex Rosenberg’s book, “Economics: Mathematical Politics or Science of Diminishing Returns” is instructive on this subject.
            Qua rhetoric, your response does confirm my initial suspicions, as does your exchange with Professor Bertram, above.

          • russnelson

            I have extensively studied the minimum wage, @43a79a8f0a419c3ec42f21a38123e901:disqus . Either the minimum wage is set low enough that it has no effect on the market (or no discernible effect, but isn’t that the same thing?), or else it *does* raise prices doing so at the cost of forcing the least productive workers to become permanently unemployable. The latter two are effects of a single cause (shifting the price curve for labor). You cannot have one without the other.

            Is there much evidence of this? No, because politicians aren’t stupid when it comes to getting re-elected. They raise the minimum wage when nearly everybody is already earning it. This makes people like you, happy with the politician whilst not actually causing massive unemployment. This leaves some leftists unhappy because they would prefer to double the minimum wage, but the politician is indifferent to their opinion because they would NEVER EVER vote for his opposition.

            If you care to take the time to dispute me, then include an explanation for McDonald’s “french fry loader” which is compatible with your theory. It is a machine which performs the task of filling a fry basket with a quantity of french fries. It’s a job that could surely be done by a human, but only at a labor price lower than the amortized capital cost of the machine. Such a labor price is unavailable in the USA.

          • david3368

            Depends on the elasticity of labour demand near the bottom, as I’m sure you know. It can behave quite oddly or Card-Krueger wouldn’t be such a puzzle.

          • TGDonlan

            Consider the possibility that Card-Kreuger isn’t a “puzzle.” It could be bad social science methodology. They ignored the fact that most of the fast-food restaurant
            workers in their study were receiving more than the minimum wage, the
            fact that the restaurants were located in diverse economic and
            demographic areas, and the fact that the people interviewed at the
            restaurants were not necessarily well-informed or responsible. They did not include
            McDonald’s restaurants in their survey, they acknowledged that McD’s managers
            tended to be unresponsive. This is like the Literary Digest predicting
            the election of Alf Landon in 1936 based on a telephone poll. Richard B. Berman, executive director of the Employment Policies
            Institute in Washington, noticed other problems with Card and Krueger’s data. He called up franchisees in
            New Jersey and Pennsylvania and persuaded them to share their real wage
            and hour data. These numbers showed that employment growth in New Jersey
            was slower than in Pennsylvania after the increase in the New Jersey
            minimum wage.
            Card and Krueger dismissed Berman on
            the grounds that the Employment Policies Institute is partially funded
            by the restaurant industry, grinding out study after study on the
            disadvantages of high minimum wages. But if Berman used real
            payroll records and the franchisees signed affidavits, his prejudice scarcely matters.

          • Deirdre McCloskey

            Dear Mr. Donlan,
            I’ll look more closely at their sampling methods. I do think that the success of their book (it is mistaken, if successful, as much of science, after all, has to be, or we would already be at the Last Judgment) opened up survey research as allowable in High Economics. But I’m not too surprised when you tell me that they didn’t do a verry good job. An economist using surveys (as Dr. Johnson said in his sexist way) is like a woman preaching: one is not surprised to find it done poorly; one is surprised to find it done at all.
            Sincerely,
            Deirdre McCloskey

          • http://www.facebook.com/les.nearhood Les Kyle Nearhood

            RussNelson, Thank you for making this statement which I have rarely seen others make. Minimum wage laws are mostly mythical, The lying politicians pander to the ignorant with minimum wages but set them so low as to have almost no effect. Because they know that if they did set them high enough to have a noticeable effect, then they would harm the economy. On those occasions when minimum wages are increased above the prevailing actual wage rate, it does no one any good as prices are simply raised to offset the higher costs. This is possible because all vendors have exactly the same rise in costs.

          • Deirdre McCloskey

            Dear Mr. Nearhood,
            Yes. Russ Roberts at George Mason has a club which he invites people to belong to (I forget the name, but it is characteristically sweet and funny, such as “The Real Economics Club”). Russ has one rule for membership. If you believe that the minimum wage is a good idea because the unemployment effect is outweighed by other, good effects, then you’re in, and also if you believe it is a bad idea because the facts are the other way around. But if you believe it is a good idea because of its symbolic value, or because it makes High Liberals Feel they are doing good, you aren’t allowed in the club.
            Sincerely,
            Deirdre McCloskey

          • Deirdre McCloskey

            Dear Professor Brian,
            I wish you would stop hiding behind “Brian” and tell me who you are. Continuing to snipe at me from beyond a curtain does not add ethos to your remarks.
            Let’s make a deal: you stop throwing around words like “silly” when they are not justified at all and I’ll stop calling your mind ill-stocked, and set to one side the question of whether the label is justified or not.
            It is “silly,” you say, to claim in a long list meant to draw people’s attention to propositions that they take as settled, obvious, old-news, not worth considering, that the minimum wage causes unemployment. On your own criterion—that many reputable economists affirm it—my claim is justified. I did not say “proven beyond a shdaow of a doubt,” just worth considering in an environment in which people think it’s settled that minimum wages are something all Good People should advocate. I never said that no reputable economist denied it. In my other posts to this oddly frenetic blog I have said so, and even mentioned some of their names: my fromer colleague (at Chicago) Richard Freeman at Harvard; my present colleague and friend and fellow faculty union member Joe Persky at UIC.
            I think the silliness is on the other side. Oh, wait: sorry.
            As to the scientific standing of economics, taking Alex as an exclusive guide is a poor idea, Alex, though admirably energetic, is a highly conventional, positivist thinker, as was for example that wonderful but misled man the late Mark Blaug. Maybe you sign on to that sort of thinking. But I don’t, and I and dozens of other writers on the philosophy of science give ample reason not to. For one thing, the word “science” means in all languages except English since the middle of the 19th century (sense 5b in the OED: look it up) “systematic inquiry,” and one can hardly deny that economics is such an inquiry. But it’s a long story, and you have to read more than one book to get it.
            Sincerely,
            Deirdre McCloskey
            Sincerely,

          • Brian

            Professor McCloskey, this is my second attempt to post a reply.
            Hopefully this one will succeed.
            Professor Zwolinski tells me the first one disappeared into cyberspace.

            (1) I am not “hiding.” Each of my submissions contains
            my full e-mail address, as Professor Zwolinski, the organizer of the symposium,
            can confirm. I had assumed, it appears incorrectly, that as the author of the
            blog post you could view that information.
            This is how I customarily post blog comments, and at least on most
            blogs, everyone knows who I am. In any
            case, I am sorry that was not the case here. I am Brian Leiter, and I stand
            behind everything I have had to say.

            (2) I of course know the original meaning of “Wissenschaft,”
            and it is one that includes history and classics, as well as economics, and
            what distinguishes it is not simply that inquiry is “systematic,” but that it
            employs certain methods that are supposed to lend epistemic credence to its
            results. The Anglophone version of “science”
            is continuous with that thought, even though it treats as the core case
            deserving the honorific the natural
            sciences, but it does so precisely because their methods are more epistemically
            robust (perhaps that is what you mean by “positivist”). It is, of course, that sense of “science”
            that economists usually invoke (you being the exception). The distinctive “methodology” of economics,
            in Milton Friedman’s classic and influential formulation, is one that admits
            unrealistic assumptions (e.g., that individuals are instrumentally rational in
            pursuit of their satisfactions) on the grounds of their predictive power. But as Rosenberg, Daniel Hausman and everyone
            (other than economists) who has considered the matter has concluded, economics
            is so predictively poor as to have no claim on being a successful science, as
            opposed to a failed one. On the one
            hand, it generates no quantitatively precise and accurate predictions; on the
            other hand, its qualitative predictions (about the existence or non-existence
            of states of affairs) are betrayed by the proliferation of ceteris paribus
            clauses whose parameters are not defined.

            (3) Someone who merely
            claimed that economics was a Wissenschaft in the classic sense, on a par with
            classics and history, would not seriously think to adduce a parade of “facts”
            and pseudo-facts, and suggest that because they arise from one version of the
            Wirtschaftswissenschaft, they warrant a skeptical inductive inference to the
            conclusion that state interventions in markets are pernicious and not necessary
            for human well-being. Someone committed
            to the thought that economics was a successful science in the sense described in
            (2) might, which is why I so interpreted your original pronouncement. But once again, there seems to be rhetorical
            sleight-of-hand at work.
            (4) All this is made worse
            by the fact that your high-handed intervention in what was previously a mostly
            serious intellectual discussion between scholars consists of a cherry-picked
            lists of facts and pseudo-facts meant to support the skeptical induction, and
            excluding from notice all the cases where state intervention was successful in
            improving human well-being—from improved public health and sanitation measures
            that reduced disease and increase longevity, to state-fundedd public education
            that improved literacy, to social insurance schemes that reduced poverty among
            the elderly and increased health outcomes throughout society. All these are also lessons of the 20th-century
            as well. So the serious scholarly
            question is why your cherry-picked list of facts and pseudo-facts is the
            relevant one. And absent some
            explanation, your entire intervention here is just a waste of time.

            Best wishes,

            Brian Leiter

          • Deirdre McCloskey

            (2)
            I of course know the original meaning of “Wissenschaft,” and it is
            one that includes history and classics, as well as economics,

            What you do not “of
            course” know is that the science word in every language (I have inquired into
            Japanese, Tamil, Finnish, and all the Indo-European languages, for example)
            means “systematic inquiry.”

            and what
            distinguishes it is not simply that inquiry is “systematic,” but that it employs
            certain methods that are supposed to lend epistemic credence to its results.

            But your extension,
            though a common one among non-physicists inspired by physics envy, is not true,
            and it is well known in the history and philosophy of science (your reading of
            which seems modest) that it is not true.
            Look at Nancy Cartwright, How the
            Laws of Physics Lie, as one example among scores.

            The
            Anglophone version of “science”is continuous with that thought, even though it
            treats as the core case deserving the honorific the natural sciences, but it
            does so precisely because their methods are more epistemically robust (perhaps
            that is what you mean by “positivist”).

            I see. So evolution is more “epistemically robust”
            than, say, the economic history that you scorn.
            Do you realize that Newtonian physics as a model for Science is quite
            different from Darwinian evolution as a model, and that the first has
            “predictions” (sometimes) and the second does not.

            It is, of course, that sense of “science” that
            economists usually invoke (you being the exception).

            What do you actually
            know of my work on the philosophy and rhetoric of science? I have written three books and sixty or so
            articles on it.

            The
            distinctive “methodology” of economics, in Milton Friedman’s classic and
            influential formulation, is one that admits unrealistic assumptions (e.g., that
            individuals are instrumentally rational in pursuit of their satisfactions) on
            the grounds of their predictive power.

            No one who has
            serious acquaintance with the philosophy of science takes Milton’s paper
            seriously. That lets out most
            economists, who take it as the Gospel.
            Milton himself (who was a colleague of mine for many years) didn’t much
            like the paper, and was astonished by its “success.” In his actual scientific work he did not
            follow it. One has to understand the
            context he was writing the paper in, against the (then) Harvard-Cambridge
            (England) view that one could dismiss “perfect” competition (that unhappy
            coinage) by noting that there are not, say, and infinite number of
            competitors. No, said Milton. We use approximations here, being empirical not
            philosophical scientists, and if flat demand curves facing suppliers are roughly so, that is enough, and might
            justify the approximation of exactly
            so for some scientific purpose.

            But
            as Rosenberg, Daniel Hausman and everyone(other than economists) who has
            considered the matter has concluded,

            So Alex and Dan (whom
            I have known for decades and most of whose works I have read) are your
            sources. Oy. You need to get out more, into the
            library. These are not bad scholars by any means. I admire both of them. But they are rigorously conventional in their
            philosophy of science.

            economics
            is so predictively poor as to have no claim on being a successful science, as opposed
            to a failed one.

            Back to
            evolution. Evolution is “predictively
            poor.” So what? You have one idea of “science,” which I have
            pointed out is not applicable outside the recent English-speaking world, and
            Newton is its prophet. If Newton was bad
            at predicting the coming of Halley’s comet, it would “fail,” to be sure. But if Darwin was bad at predicting the
            future biology the human race, or for that matter if geologists were bad at
            predicting earthquakes (as they admittedly are), would would you conclude? Not “science”? Pretty silly, right?

            On the one hand,
            it generates no quantitatively precise and accurate predictions;

            That’s sometimes true
            and sometimes not. If the central banks of the world increase the money
            supply by a factor of four in 15 years, as they in fact did in the 1970s and
            1980s, then an economist would predict that the world’s price level would also
            increase by a factor of four. It
            did. If a tax is imposed on cigarettes
            (as Quinn wants to do) the effect on consumption can be predicted pretty well.

            on the other
            hand, its qualitative predictions (about the existence or non-existence of
            states of affairs) are betrayed by the proliferation of ceteris paribus clauses
            whose parameters are not defined.

            I agree with you that
            qualitative theorems, such as Paul Samuelson and Kenneth Arrow recommended we
            specialize in, are not science. (If you
            knew anything about my work on the philosophy of economics, instead of merely
            adopting a sneering pose against someone so obviously beneath you in
            scholarship, you would know this. You
            can find a simple introduction to the point in “The Secret Sins of Economics”
            (#3 of the Prickley Paradigm Press pamphlets from the U of Chicago Press),
            which is available free on line. Your
            point about ceteris paribus, though, is amateurish, the usual criticism that
            people who do not understand economics make.
            To understand the role of ceteris paribus you’ll need to learn some
            economics. I recommend The Applied Theory of Price.

            (3)
            Someone who merely claimed that economics was a Wissenschaft in the classic
            sense, on a par with classics and history, would not seriously think to adduce
            a parade of “facts”

            What are you talking
            about? Natural philosophy, from which
            evolution emerged, is a “parade” of
            facts. What’s your problem with fact
            parades? Or do you have some Method that
            obviates them?

            and
            pseudo-facts,

            What do you actually
            know about the economic history involved?
            Not much. As my former dean
            Stanley Fish entitled a paper attacking (as I recall) Dworkin, “Don’t know much
            about the Middle Ages/ Look at the pictures and turn the pages.” Every one of my facts is based on serious
            studies, some of them by your colleagues at the Law School (the ones you won’t
            talk to because they don’t agree with you politically, such as Bill Landes)

            and suggest
            that because they arise from one version of the Wirtschaftswissenschaft, they
            warrant a skeptical inductive inference to the conclusion that state
            interventions in markets are pernicious and not necessary for human well-being.

            That’s silly. You make your task easier by attributing to
            me the view, on no evidence, that no “state intervention . . . is
            necessary.” Where in my writings, the
            present one or any other, do you find such a position? States are good for enforcing inoculation,
            for example, or defending us from Canadian invasion, or issuing drivers’
            licenses (I have driven in Belgium before they had such, and it made me a
            convert to that particular state intervention; though tort laws, as you well
            understand, could achieve perhaps a similar level of care),

            Someone committed to the thought that
            economics was a successful science in the sense described in (2) might, which
            is why I so interpreted your original pronouncement. But once again, there
            seems to be rhetorical sleight-of-hand at work.

            Since no one of sense
            thinks that economics is or can be or should be a Science Like Newtonian
            Physics, I don’t see the point.

            4)
            All this is made worse by the fact that your high-handed intervention in what
            was previously a mostly serious intellectual discussion between scholars

            For Lord’s sake, I invited to “intervene”! What’s “high-handed” about responding
            amiably to an editor’s request to “intervene”?
            And, what, am I not a “scholar”?
            You need to try me out before you use that sneer (but I have noted
            before that you do not seem to have much pre-frontal lobe control over your
            rhetorical impulses; I’d worry about it at your age). I know more than you do of a scholarly sort
            about economic history (as I suppose you would concede) and philosophy of
            science and economic theory, to mention a few areas where I have claim to be a
            “scholar.”

            consists of a
            cherry-picked lists of facts and pseudo-facts

            Of course they are “cherry
            picked.” That is the rhetorical
            point. “Here are some scholarly findings
            that High Liberals ignore, if they have heard of them at all.” If I was seeking to give a balanced case for
            what level of government intervention makes for the best society I would do so,
            and in fact do so in courses to undergraduates, say. But I thought we were engaged in a serious
            intellectual discussion. If you can’t
            answer the picked cherries, I am saying, your unexamined case for increased
            government intervention is in trouble.
            Yes?

            meant to
            support the skeptical induction, and excluding from notice all the cases where
            state intervention was successful in improving human well-being—from improved
            public health and sanitation measures that reduced disease and increase
            longevity, to state-funded that improved literacy, to social insurance schemes
            that reduced poverty among the elderly and increased health outcomes throughout
            society.

            See above: I never
            said that governments never did anything good.
            The Good War. The Interstate
            Highway System. You, again, make your
            case easier by claiming that I made an argument of Evil Government. That allows you to avoid finding out if my factual
            claims are true or not, and you can rest tonight in your sneering and your indignation
            and your High-Liberal conviction that you are a Good Person Among the Bien-Pensant.

            All these are
            also lessons of the 20th-century as well. So the serious scholarly question is
            why your cherry-picked list of facts and pseudo-facts is the relevant one. And
            absent some explanation, your entire intervention here is just a waste of time.

            That’s nice: back to
            the fevered adolescent. You really ought
            to have some therapy, and learn to act like a grown man.

          • Brian

            I see you were unable to resist the return to “personal abuse,” even though I identified mysef and expressed myself clearly and directly, which I thought you wanted. So I guess we are done, and you have shown your true colors. I will make three small points: first, your citation to Nancy Cartwright is irrelevant in this context; second, parts of evolutionary biology do indeed generate predictions, but since no one, except Friedman in the aforementioned paper, is committed to the view that predictive success is the sine qua non of a science, I’m not sure who you’re arguing against; third, I am mystified by the reference to my esteemed colleague Bill Landes. He is retired. He spends the winter months in a warmer climate. He rarely attends workshops anymore. I am hardly the only one who doesn’t “talk” to him, since we hardly see enough of him anymore. But, again, your pointless aside on this score is revealing.

          • Deirdre McCloskey

            Dear Professor Leiter,
            All right, you give up. The true colors that you have shown are that you are ignorant of the philosophy of science and of the economic history that I bring forward for the attention of High Liberals. As to Bill: perhaps you are familiar with the figure of speech “part for whole” (synecdoche); Bill is merely an emblem to stand for your inability to listen, really listen.
            Sincerely,
            Deirdre McCloskey

          • Deirdre McCloskey

            I reply to your post at length in the extra link cited at the bottom. I’ll try here to post it.

            (2)
            I of course know the original meaning of “Wissenschaft,” and it is
            one that includes history and classics, as well as economics,

            What you do not “of
            course” know is that the science word in every language (I have inquired into
            Japanese, Tamil, Finnish, and all the Indo-European languages, for example)
            means “systematic inquiry.”

            and what
            distinguishes it is not simply that inquiry is “systematic,” but that it employs
            certain methods that are supposed to lend epistemic credence to its results.

            But your extension,
            though a common one among non-physicists inspired by physics envy, is not true,
            and it is well known in the history and philosophy of science (your reading of
            which seems modest) that it is not true.
            Look at Nancy Cartwright, How the
            Laws of Physics Lie, as one example among scores.

            The
            Anglophone version of “science”is continuous with that thought, even though it
            treats as the core case deserving the honorific the natural sciences, but it
            does so precisely because their methods are more epistemically robust (perhaps
            that is what you mean by “positivist”).

            I see. So evolution is more “epistemically robust”
            than, say, the economic history that you scorn.
            Do you realize that Newtonian physics as a model for Science is quite
            different from Darwinian evolution as a model, and that the first has
            “predictions” (sometimes) and the second does not.

            It is, of course, that sense of “science” that
            economists usually invoke (you being the exception).

            What do you actually
            know of my work on the philosophy and rhetoric of science? I have written three books and sixty or so
            articles on it.

            The
            distinctive “methodology” of economics, in Milton Friedman’s classic and
            influential formulation, is one that admits unrealistic assumptions (e.g., that
            individuals are instrumentally rational in pursuit of their satisfactions) on
            the grounds of their predictive power.

            No one who has
            serious acquaintance with the philosophy of science takes Milton’s paper
            seriously. That lets out most
            economists, who take it as the Gospel.
            Milton himself (who was a colleague of mine for many years) didn’t much
            like the paper, and was astonished by its “success.” In his actual scientific work he did not
            follow it. One has to understand the
            context he was writing the paper in, against the (then) Harvard-Cambridge
            (England) view that one could dismiss “perfect” competition (that unhappy
            coinage) by noting that there are not, say, and infinite number of
            competitors. No, said Milton. We use approximations here, being empirical not
            philosophical scientists, and if flat demand curves facing suppliers are roughly so, that is enough, and might
            justify the approximation of exactly
            so for some scientific purpose.

            But
            as Rosenberg, Daniel Hausman and everyone(other than economists) who has
            considered the matter has concluded,

            So Alex and Dan (whom
            I have known for decades and most of whose works I have read) are your
            sources. Oy. You need to get out more, into the
            library. These are not bad scholars by any means. I admire both of them. But they are rigorously conventional in their
            philosophy of science.

            economics
            is so predictively poor as to have no claim on being a successful science, as opposed
            to a failed one.

            Back to
            evolution. Evolution is “predictively
            poor.” So what? You have one idea of “science,” which I have
            pointed out is not applicable outside the recent English-speaking world, and
            Newton is its prophet. If Newton was bad
            at predicting the coming of Halley’s comet, it would “fail,” to be sure. But if Darwin was bad at predicting the
            future biology the human race, or for that matter if geologists were bad at
            predicting earthquakes (as they admittedly are), would would you conclude? Not “science”? Pretty silly, right?

            On the one hand,
            it generates no quantitatively precise and accurate predictions;

            That’s sometimes true
            and sometimes not. If the central banks of the world increase the money
            supply by a factor of four in 15 years, as they in fact did in the 1970s and
            1980s, then an economist would predict that the world’s price level would also
            increase by a factor of four. It
            did. If a tax is imposed on cigarettes
            (as Quinn wants to do) the effect on consumption can be predicted pretty well.

            on the other
            hand, its qualitative predictions (about the existence or non-existence of
            states of affairs) are betrayed by the proliferation of ceteris paribus clauses
            whose parameters are not defined.

            I agree with you that
            qualitative theorems, such as Paul Samuelson and Kenneth Arrow recommended we
            specialize in, are not science. (If you
            knew anything about my work on the philosophy of economics, instead of merely
            adopting a sneering pose against someone so obviously beneath you in
            scholarship, you would know this. You
            can find a simple introduction to the point in “The Secret Sins of Economics”
            (#3 of the Prickley Paradigm Press pamphlets from the U of Chicago Press),
            which is available free on line. Your
            point about ceteris paribus, though, is amateurish, the usual criticism that
            people who do not understand economics make.
            To understand the role of ceteris paribus you’ll need to learn some
            economics. I recommend The Applied Theory of Price.

            (3)
            Someone who merely claimed that economics was a Wissenschaft in the classic
            sense, on a par with classics and history, would not seriously think to adduce
            a parade of “facts”

            What are you talking
            about? Natural philosophy, from which
            evolution emerged, is a “parade” of
            facts. What’s your problem with fact
            parades? Or do you have some Method that
            obviates them?

            and
            pseudo-facts,

            What do you actually
            know about the economic history involved?
            Not much. As my former dean
            Stanley Fish entitled a paper attacking (as I recall) Dworkin, “Don’t know much
            about the Middle Ages/ Look at the pictures and turn the pages.” Every one of my facts is based on serious
            studies, some of them by your colleagues at the Law School (the ones you won’t
            talk to because they don’t agree with you politically, such as Bill Landes)

            and suggest
            that because they arise from one version of the Wirtschaftswissenschaft, they
            warrant a skeptical inductive inference to the conclusion that state
            interventions in markets are pernicious and not necessary for human well-being.

            That’s silly. You make your task easier by attributing to
            me the view, on no evidence, that no “state intervention . . . is
            necessary.” Where in my writings, the
            present one or any other, do you find such a position? States are good for enforcing inoculation,
            for example, or defending us from Canadian invasion, or issuing drivers’
            licenses (I have driven in Belgium before they had such, and it made me a
            convert to that particular state intervention; though tort laws, as you well
            understand, could achieve perhaps a similar level of care),

            Someone committed to the thought that
            economics was a successful science in the sense described in (2) might, which
            is why I so interpreted your original pronouncement. But once again, there
            seems to be rhetorical sleight-of-hand at work.

            Since no one of sense
            thinks that economics is or can be or should be a Science Like Newtonian
            Physics, I don’t see the point.

            4)
            All this is made worse by the fact that your high-handed intervention in what
            was previously a mostly serious intellectual discussion between scholars

            For Lord’s sake, I invited to “intervene”! What’s “high-handed” about responding
            amiably to an editor’s request to “intervene”?
            And, what, am I not a “scholar”?
            You need to try me out before you use that sneer (but I have noted
            before that you do not seem to have much pre-frontal lobe control over your
            rhetorical impulses; I’d worry about it at your age). I know more than you do of a scholarly sort
            about economic history (as I suppose you would concede) and philosophy of
            science and economic theory, to mention a few areas where I have claim to be a
            “scholar.”

            consists of a
            cherry-picked lists of facts and pseudo-facts

            Of course they are “cherry
            picked.” That is the rhetorical
            point. “Here are some scholarly findings
            that High Liberals ignore, if they have heard of them at all.” If I was seeking to give a balanced case for
            what level of government intervention makes for the best society I would do so,
            and in fact do so in courses to undergraduates, say. But I thought we were engaged in a serious
            intellectual discussion. If you can’t
            answer the picked cherries, I am saying, your unexamined case for increased
            government intervention is in trouble.
            Yes?

            meant to
            support the skeptical induction, and excluding from notice all the cases where
            state intervention was successful in improving human well-being—from improved
            public health and sanitation measures that reduced disease and increase
            longevity, to state-funded that improved literacy, to social insurance schemes
            that reduced poverty among the elderly and increased health outcomes throughout
            society.

            See above: I never
            said that governments never did anything good.
            The Good War. The Interstate
            Highway System. You, again, make your
            case easier by claiming that I made an argument of Evil Government. That allows you to avoid finding out if my factual
            claims are true or not, and you can rest tonight in your sneering and your indignation
            and your High-Liberal conviction that you are a Good Person Among the Bien-Pensant.

            All these are
            also lessons of the 20th-century as well. So the serious scholarly question is
            why your cherry-picked list of facts and pseudo-facts is the relevant one. And
            absent some explanation, your entire intervention here is just a waste of time.

            That’s nice: back to
            the fevered adolescent. You really ought
            to have some therapy, and learn to act like a grown man.

        • Counsellor

          @43a79a8f0a419c3ec42f21a38123e901:disqus
          Read (at least ) the two books and see where McCloskey departs from what you refer to as the Chicago School. I have read both, researched many of the references (often outside “economics”).
          Congruence rather than “support” is what one should look for in developing perpectives of human actions.

      • Deirdre McCloskey

        Dear Mr. Pennington,
        Exactly. (Though again I do not like the use of the ancient and honorable word “rhetoric” in the sense you have used it!)
        What we need to do is to shift the burden of proof.
        Sincerely,
        Deirdre McCloskey

    • Deirdre McCloskey

      Dear Brian,
      Be reasonable. I had two pages, and in fact refer to scores of facts, proven or at any rate plausibly argued in hundeds of books and articles, some by me, some by people like Art Carden or Lynne Kiesling (to mention two serious scientists on such matters who are participating in this discussion), in order to alert you to the their existence. You probably did not know of most of them, right?
      For example, I’ll bet you did not know that protective legislation “for” women in the 1920s neatly prevented women from holding supervisory positions in factories, by limiting their hours of work. Supervisors come early and leave late. Am I right? You didn’t know that, did you? Be honest.
      Then stop complaining that I do not bring out the dozens of citations to the literature showing it to be a fact.
      Sincerely,
      Deirdre McCloskey

      • Brian

        You are, as you well know, representing partisan opinion *even in the economics literature* as established facts. They are not, and you also know that, so the whole exercise is mostly one of rhetorical sleight-of-hand. Your comment here is iillustrative: what could be the relevance of the fact that states legislated based on sexist assumptions in the 1920s? What is it supposed to show? It’s presumably not your hypothesis that absent such laws, factories would have all employed women as supervisors. Sexism was not an artifact of legislative action. So what is the relevance? That we should be cautious about the role of prejudice int he actions of public and private actors? No one disagrees, of course. But you adduce this, and other similar examples, in the context of suggesting that those who favor government regulation as a response to market deficiencies are guilty of a kind of generic mistake. But this is a non-sequitur.

        • russnelson

          I know of only one paper (Card & Kreuger) which claims that raising the minimum wage increases employment. Pretty much every economist laughs at them, because their data is the plural of anecdote. Rather than actually *measuring* anything, they called up restaurant owners and asked them if their employment had increased or decreased. Pathetic, and laughable.

          • Deirdre McCloskey

            Dear Russ Nelson,
            Oh, I hadn’t noticed that. That’s interesting. It’s more evidence that economists need education in data gathering and serious confrontation with facts beyond more and more econometric techniques. I think it was virtuous of Card and Kreuger to consider asking, but I agree that just asking, without checks, is not so hot. Ziliak and I nailed them for a naive use of statistical significance, in our The Cult of Statistical Significance.
            Sincerely,
            Deirdre McCloskey

        • http://www.facebook.com/people/Bear-Nichols/9626357 Bear Nichols

          The point is easy to miss. Laws have unintended consequences even if their intent was benevolent. Passing laws to protect women can in fact harm them, even if unintentionally. I believe this is all the author is claiming and nothing more. It’s hard to find anything partisan about such a claim. Many on the left have no difficulty seeing this in times of war. “The only consequence of war is unintended consequences.” Just because someone is partisan does not make one wrong.

          Facts are chosen. They are subject to confirmation bias. If we know this, then we should be very skeptical of anyone who claims to have them.

          And if nasty things are a product of the times or culture, how can you be sure that your ideas are not deficient in the same manner? This is the whole point of liberalism – to have humility and to understand that our knowledge is severely limited.

        • Deirdre McCloskey

          Dear Brian,
          I’ll be glad to enter into a discussion with you about the relevance of what you consider “partisan opinion”—which I suppose does not characterize the opposite views, such as that protective legislation was a good idea and sincere and a wonderful example of how sweet the government [run by men] is, none of which is true, at any rate in the opinion of many historian of women.
          But I’m going to make a New Rule, which applies to you alone. Unless you tell me who you are, I’m not going to answer you any more. I find it repulsive that you continue to hide out and sneer while I put my opinions out under my name for people to challenge, here and in my books and articles. What kind of a man are you? You say you teach at my beloved University of Chicago. Good. In those halls people say what they think, out loud, with their names attached, They take responsibility. Until you do, I can’t be bothered.
          Sincerely, more in sorrow than in anger,
          Deirdre McCloskey

          • purple_platypus

            Why? What is with your bizarre obsession with whether people use their real names in a context like this?

            You seem reasonably intelligent otherwise (though oddly reluctant to demonstrate it by actually ENGAGING with the arguments of anyone who’s actually critical of you in any serious way). So surely you realize that’s of no relevance whatsofuckingever to the actual arguments. So why keep attempting to drag the conversation onto that particular tangent? You keep proclaiming your self-evident intellectual superiority in a way that is, frankly, incredibly off-putting, but whatever you might do in your books, this thread so far contains, in the novel-like volume of words you’ve produced, not the slightest evidence that you even understand the concept of logical argument, much less are any better at it than anyone else here.

            By the way, I’ll be charitable and assume your habit of formatting your comments like formal letters is meant to be polite, but it comes across as nearly the opposite – haughty and superior – especially given the tone of much of what is between those “dear”s and “sincerely”s. At best, it’s pointless redundancy.

          • brotio

            but it comes across as nearly the opposite – haughty and superior

            Yet, here you are, replying to the “haughty and superior” host with a sneering and condescending comment of your own.

            BTW, I prefer to use an internet handle when commenting on political blogs because Statists are not nice people, and are often quite willing to use violence against people and the property of people who disagree with their socialist views. It’s not perfect, and if some socialist bomb-thrower wanted to work hard enough, I’m sure they can find my info, but it is a buffer against the Muirgeos of the blogosphere, and they greatly outnumber the smart Statists out here.

            However, if Ms. McCloskey asks for me to reveal my identity via private email, I will happily honor her request.

          • purple_platypus

            This is the same sort of irrelevant drivel I just finished criticizing in my previous post. Shall I count the ways?

            First of all, as already pointed out, the use or non-use of pseudonyms is of no relevance to any topic of interest here. Presumably even you agree, as you’re also using one. So why is it even worth discussing?

            Secondly, there’s no such thing as a “Statist”. Nobody, but nobody, thinks of state power as an end in itself. Some people think it can be used for good (in fact, in an *extremely* careful and qualified way, even Professor McCloskey thinks this), while disagreeing wildly about when and to what extent, while a very, very small minority think this is impossible or too risky to be worth it.

            Thirdly, tarring all “Statists” as you define the term as nasty and violent people is a completely ridiculous smear that I’m probably giving undeserved credibility by commenting on at all. You don’t see me or anyone else here smearing all Libertarians as selfish jerks incapable of seeing past the ends of their noses – and make no mistake, that DOES accurately describe a not insignificant number of them, but of course, by no means all.

            Fourth, your Tea Partyesque misuse of the term “socialist” bespeaks a level of ignorance that almost *has* to be culpable. When garden-variety conservatives engage in this same misuse, I can pretty safely assume they *are* that ignorant, or are pandering to a base that is, but I would like to think Libertarians, as a group, are a little more intellectually responsible than that. Fortunately, your standing as a counterexample doesn’t reflect on the other contributors to this blog, who, while I don’t always agree with what they have to say, at least make a point of understanding the meanings of the terms they use.

          • brotio

            My definition of Statist is socialists, fascists, American liberals, and progressives – collectively.

            I
            will admit that I used the term “socialist” imprecisely. As Dr Sowell pointed out, American progressives and liberals are more fascistic than socialistic.

            I agree that ALL violence against people merely for expressing opinions is bad, but stand by my assertion that it is a tactic far more often employed by the Left than by conservatives or libertarians.

            I’ve seen the bricks thrown at people crossing picket lines (and at their cars). Or, the death threats issued at those same strike-breakers, along with signs on their front yards stating, “We know where you live”. The property damage caused during any “economic” summit is invariably caused by Leftist rioters. The vandalism in Oakland by the Occupy crowd has no Tea Party equivalent. The Occupy protests are so dangerous that “Rape-free zones” are set up to protect the women. Such zones are unnecessary at Tea Party rallies.

            BTW: My comment about your sneering condescension was aimed at your “haughty and superior” paragraph. I should have simply referred to it as, “snotty”.

          • brotio

            One more BTW: I intended to write, “… MOST Statists are not nice people…” but forgot the modifier.

            You might not be one of those Leftists who would key someone’s car for having a Bush/Cheney bumper sticker on it, but until I know better, I’d prefer you not know where my car is parked.

          • http://www.facebook.com/people/Jorge-Emilio-Emrys-Landivar/37403083 Jorge Emilio Emrys Landivar

            “BTW, I prefer to use an internet handle when commenting on political blogs because Statists are not nice people, and are often quite willing to use violence against people and the property of people who disagree with their socialist views.”

            While it hasn’t happened to me, I know people who have had meatspace violence done to them due to expressing “right-winged” opinions online.

          • purple_platypus

            I won’t say it never happens, but at least in the current US political climate, it’s FAR more dangerous to express what pass for “left-wing” opinions in the US right now (even those that would be center, mainstream ones almost anywhere else) than to express “right-wing” ones. Jorge and Brotio, can we agree that ALL violence against people merely for expressing opinions is bad, or do you feel that only applies to the ones you agree with?

        • muliolis

          Brian: Are you one of those who continues to believe the liberal propaganda that the Great Depression was caused by Herbert Hoover’s laissez-faire policies? Read Hoover’s own memoirs, which are readily available online in PDF format. You will learn that his policies were nowhere close to laissez-faire. Many of the other myths you have been taught are equally false.

          Saulius Muliolis
          “The Free Market’s Alibi”

      • http://www.facebook.com/colin.downes Colin Downes

        Presumably your interlocutors aren’t unaware of the claims you recite here. I’ve heard the bulk of them before, and I’m far from a scholar. More likely and more charitably they just disagree with you as to their truth or have a different view of their implications for policymakers.

        • Deirdre McCloskey

          Dear Mr. Downes,
          Ah, another person who actually signs his name. Congratulations: you are now a member of my personal Serious Bloggers Club. I plan to have it registered in the State of Illinois. The dues are derisory.
          Maybe Everyone Knows. But what they do not know is that the claims I recite are seriously argued by serious people and have commonly a good deal of logic and evidence, metaphors and stories, to back them up. The left thinks that most such claims are “silly.” Evidence? See “Brian” (who does not, I’m afraid, belong to our Club).
          Sincerely,
          Deirdre McCloskey

          • purple_platypus

            Personally, my standards for which bloggers to take seriously have a LOT more to do with whether they actually USE that “logic and evidence” you keep claiming the existence of, yet actively avoid actually including in your posts, than whether they sign their real names to their posts. The silliest thing of all here is the amount of importance you attach to the latter.

          • purple_platypus

            Personally, my standards for which bloggers to take serious have a LOT more to do with whether they actually USE that “logic and evidence” you keep claiming the existence of, yet actively avoid actually including in your posts, than whether they sign their real names to their posts. The silliest thing of all here is the amount of importance you attach to the latter.

          • Deirdre McCloskey

            I don’t know how. Sorry.

  • Jason

    It’s not clear to me that interventions, regulations, and so forth described here are the ones that Anderson or Freeman believe would be efficacious in dealing with the externalities, asymmetrical information, and other collective action problems they discuss. (In particular, the civil rights violations that McCloskey associates with “the State” have nothing to do with the issues raised by Anderson and Freeman.) 

    Few deny that Soviet-style central planning and state-owned industries are bad ideas. We cannot leap from that fact to the sweeping conclusion that all market interventions at all times will have disastrous results. To do so is to engage in the same sort of fact-free rationalism that McCloskey sneers at earlier in this post. There are specific contexts in which markets deliver results that anyone (well, anyone except for a libertarian dogmatist) would regard as undesirable. We know a lot more about these, now, than we did 50 or 100 years ago. What we need is a discussion of (economically informed) remedies for these specific market failures. Liberals need to bear in mind that such remedies must be judged on the basis of their actual consequences. But libertarians need to be open to the idea that, while there are always costs associated with interventions, some of these interventions may be “on balance” preferable to the status quo. There is no cosmic guarantee that markets will always be the better option, especially given the quirks of human nature unveiled by some of the authors whom McCloskey mentions in passing. 

    • Deirdre McCloskey

      Dear Jason,
      Your sober and sophisticated words are correct. As I said, some state action is desirable. I lived in England in 1959 as the laws against soft-coal burning were taking effect, and there is no entity but a state that could have achieved such a good compulsion. But good compulsions are much rarer factually than people think who talk of “services” or congresspeople who talk of “programs,” and that’s most people these days. It is why I lean against.
      It is wrong to put the issue at the “cosmic” level. That after all was my point: let us get down to the facts, if facts is what we are assuming.
      But this much is true in the cosmos: states have monopolies of violence, and use them; markets and gifts do not. Of the three realms of state, market, and grace, I want every time, acknowledging in the style of Ronald Coase that we can’t do this analysis on a blackboard, to see the actual evidence that violence is necessary before I sign on to using it to achieve “actual consequences.” I have a bias towards markets and what Boulding called the grants economy (“grace” I am calling it here, theologically speaking: caring for children, loving your friends, feeding the poor), and I have a bias against monopolies of violence, so easily tempted to be used to enrich ones friends and tyrannize over the poor and weak.
      I repeat what I said to Brian: I do not understand the reflex to defend the massive modern state. As Hayek said, the more complicated the society the worse is the argument for top-down Reason as the way to organize it.
      Sincerely,
      Deirdre McCloskey

      • Ben Kennedy

        I’m surprised you say that. I expected “we leave in clean, pollution-free neighborhoods because of environmental protection laws” in your excellent list of Things People Believe

        • Deirdre McCloskey

          Dear Mr. Kennedy,
          I listed the things they believe that maybe ain’t so. As Mark Twain said, that’s the stuff that does the most mischief.
          Sincerely,
          Deirdre McCloskey

          • Ben Kennedy

            My point is to challenge you from the nonarchist side. A lot of people believe that laws against pollution are the reason that there is, in general, not a huge amount of it. It is the same mindset that thinks that laws against child labor are the reason there is no child labor. Yet, we know that the real reason there is less pollution and less child labor over time is because human innovation has increased our productive capacity. We no longer (in the US at any rate) need to rely on the income from child labor, or energy from the most polluting fuel sources. This is why child labor is rampant in Bangladesh, despite the fact it is illegal. Government doesn’t bring progress, entrepreneurs do. Now, I know that you know all this, which is why I’d like to see you go all the way – monopoly use of force just isn’t necessary in a free society

          • Deirdre McCloskey

            Dear Mr. Kennedy,
            I have at times agreed with you, and still have a nostalgia for Prince Kropotkin, whom I discovered age 14 in the local Carnegie Library in Wakefield, MA. Which rather makes your point, and Graham Peterson’s: that the revolutionaary writings of a pacifist anarchist prince of the Russian Empire could be found in a library built with funds from Andrew Carnegie (speaking of entrepreneurs), and in the 11th edition of the Britannica, suggests that grace and exchange do the trick. Matt Ridley is fond of evoking the character of his home town in the coal-mining northeast of England in 1800 as hive of voluntary and market cooperation, before it became a ward of the 20th-century state.
            And I certainly agree—it is apparent in the state-loving rhetoric of many of our colleagues here—that giving the state an inch it is likely to take a long mile. Give the state the FDA and it embarks on prohibition of recreational drugs. Give the state driver’s licenses and it starts stopping people for DWBs (driving while Black).
            What to do, what to do? Let’s start by telling our High Liberal friends that they history they believe is obvious ain’t.

    • Christian Coopersmith

      “There is no cosmic guarantee that markets will always be the better option.”

      Reductio ad absurdum is generally not the best way to make arguments on the social sciences or in economics. When the RAA is laced with ambiguity (the “better option”) they are even less useful. Moreover, many of the names mentioned here would not argue that government intervention is never a preferred option. Milton Friedman, for example, allowed that government could probably serve better than any other option the needs related to protection from foreign violence (military), protection from domestic violence (police) and enforcement of private agreements in the event of dispute (courts). He even allowed that some environmental regulation could be justified.

      But the problem he grappled with, and that anarchists attack him for, is how do you limit government once you let it out of its bag? And this is a very real problem and one that Friedman took extremely seriously. Government grows like an out-of-control weed. Friedman thought that it was necessary to amend the constitution to place strict and inviolate limits on the growth in government spending from year to year. That he thought a constitutional amendment was necessary suggests how intractable he saw the problem of government metastasis to be.

      As to your contention that there is no “cosmic guarantee” that the market will be the better option — without getting into what “cosmic guarantee” means, I think we can say that the thrust of that statement is wrong. The cosmic guarantee that makes markets, rather than governments, usually the best guarantor of economic and political liberty is that in markets power is highly distributed among people and decisions are made continuously, not occasionally, compared to governments. The cosmic guarantee, therefore, is competition. He who is best at satisfying the needs of consumers wins. The moment someone else is better, that someone else wins. The only way to succeed is to better satisfy the consumer of your product or service. The cosmic guarantee is radical meritocracy.

      Against this truism liberals have long made arguments as follows: Everything can’t be reduced to money. Competition is cold and heartless. Meritocracies don’t take care of the weak and are no guarantee of “fairness.” What about people who don’t start with equal advantages? What about big powerful corporations that grow gargantuan and game the system?

      Space does not permit, but all of these arguments have been dismantled in one way or the other. The simple version of the story is that whenever a government agency is put into place to introduce “fairness,” it must fall to some komissar or committee to decide what is “fair.” That requires the making of arbitrary distinctions and allocating other than according to who values the allocated good the most. Take Hurricane Sandy for example. There were gasoline supply disruptions and there were long lines at gasoline stations. The supply disruptions were the work of the Hurricane. But make no mistake about it, the long lines at gas stations were the work of the NJ state government. As the storm was about to hit, Governor Christie pointedly reminded folks that the State would vigorously enforce the “anti-gouging law” that limited the ability of vendors to raise prices of certain commodities in “emergencies.” As a result, gas stations could not raise prices to reflect scarcer supply. Since allocation could not be on the basis of demand and willingness to pay, it was made on an arbitrary basis. Were the people who got gas the ones who needed it the most and therefore would pay the most? Were they the ones with the emptiest tanks? No, the people who got gas were the ones who had the most time on their hands and could afford the time needed to wait in long lines. Often people who have the most time available to do nothing are not the most productive members of society to whom scarce resources should be allocated.

      Had prices been allowed to rise to meet the supply disruption, prices might have transiently spiked at $10 a gallon or so for a day or two. But as they rose, other alternatives would quickly have arisen to fill the void. Those who had gas would have been incentivized to turn their cars into taxis to get people around (if it were not for licensing laws that made it illegal for them to do that). People who ordinarily drove only for their own personal use would have been incentivized to sell transportation in their vehicles to other. Gasoline refiners would have been incentivized to try to restore supplies faster. These substitutes, had they been allowed to develop, would have then moderated and reversed the price rise.

      Thus, the right reaction on the part of Governor Christie to the emergency would have been, far from threatening to enforce price controls, to declare a regulation holiday — to suspend any regulations on gas prices or transportation licensing as long as supplies were tight.

      Had he done that, the storm would barely have been noticed for its effect on gasoline supplies.

      Markets may not come with a cosmic guarantee, but they are infinitely more supple and flexible than any bureaucracy.

  • http://twitter.com/geoffarnold Geoff Arnold

    Hmm. A breathtaking series of arguments from assertion, cast as universals which betray an unscientific lack of humility.  This paragraph is a great example:

    “No.  The master narrative of High Liberalism is mistaken factually.  Externalities do not imply that a government can do better.  Publicity does better than inspectors in restraining the alleged desire of businesspeople to poison their customers.  Efficiency is not the chief merit of a market economy: innovation is.  Rules arose in merchant courts and Quaker fixed prices long before governments started enforcing them.”

    “Publicity does better.” No contingency there, no allowance for contextual influences.  Is it true in the face of media monopolies and cartels? Doubtful. In fact the final sentence provides a perfect example of how governance and enforcement has changed over time.

    • Mark Pennington

      Try reading Deidre’s books – The Bourgeois Virtues, and the more recent Bourgeois Dignity to see the evidence set out in compelling detail. This is a blog post responding to a series of totally unsubstantiated claims by Anderson and Arneson. Deidre is one of the best economic historians out there -so check out her work first and then come a judgement about whether she lacks ‘scientific humility’

      • http://twitter.com/VelizCF CFV

        Mark,
        Within the standard libertarian literature, I haven’t been able to find any discussion of the “efficiency wage hypothesis”. If the efficiency wage hypothesis is true, minimum wage laws do not figure in the explanans of (unvoluntary) unemployment.

        Maybe the efficiency wage hypothesis is false, but some libertarians are not careful enough, and out of hand of their ideological commitment against minimum wage laws, they disregard the factual evidence.

        Check also: http://press.princeton.edu/titles/5632.html

        • http://www.sandiego.edu/~mzwolinski Matt Zwolinski

          Ben Powell and I include a brief discussion of it in our recent paper on sweatshops.
          http://papers.ssrn.com/sol3/papers.cfm?abstract_id=1947569

        • Mark Pennington

          Check out some of the articles in the Crampton and Cowen volume ‘Market Failure or Success’ (2002) for a discussion of the efficiency wage hypothesis. There is also an excellent summary of the debate on the effect of minimum wage laws by Glenn Whitman in Critical Review a few years back.
          From a Hayekian perspective, though one couldn’t rule out in principle the idea of a minimum wage regulation having no impact on unemployment for ‘efficiency wage reasons’ – regulators are unlikely to know what the ‘right wage’ is. They are not subject to a competitive process which can mobilise dispersed knowledge and it is hard to drive mistaken regulators out of business, so to speak, because they do not operate within a profit and loss constraint.

          • russnelson

            This matches my understanding as well. There *is* a perfect minimum wage which will not cause any unemployment. Similarly, there is a perfect allocation of goods to households. But given that we’re pretty sure that P != NP, knowing that perfection exists is NOT knowing how to achieve it.

        • 3cantuna

          The employer made a right move, or at least more right than not, if she makes a profit. There is no other way of judgment but analysis by what price is fetched post-effort. So there may be instances where comparatively higher wages produce better output enabling a market advantage– but it might not. An employee’s motivation is subjective. So is the employer’s. The key here is “ceteris paribus”: All things being equal (given a set demand) minimum wage laws that push rates above the market will effect involuntary un- under- employment. Of course, there could be a minimum wage law that has almost no effect because the real market rate is already above it. An economic law is in play when the empirical circumstance emerges. Economic propositions are not ideological, at any rate.

          • Deirdre McCloskey

            Dear 3cantuna,
            Nicely put. But if laws could make the poor richer, I would join the clamor for a rise in the minimum wage. It seems like magic, and a magic that has to work now, and noot before or later, if you see what I mean.
            Anyway, I think we can all agree that the South African minimum wage is a massive catastrophe for the poor of South Africa.
            But all propositions are “ideological,” dear. You need some increase in your philosophical sophistication,I think.
            Sincerely,
            Deirdre McCloskey

          • 3cantuna

            Dear Prof. Deirdre,

            I guess I would rather be right than sophisticated. I meant economic law in the Austrian (sans Hayek) theoretical sense, not legislation. It is here that Mises trumps your Hayek and Friedman on the nature of evidence in economics. I will cite Boettke if you want a reference on the necessary component of reality: theory laden social facts. Hayek’s compatibility with Popper is unfortunate. More unfortunate if you followed the empiricist strategy to back up your long and admirable list of government failures. Facts do not speak for themselves, especially ones caused by human purposive action.

            If an economic proposition is true, it is not an ideological statement. Unless you mean that people believe what they want to believe, regardless of the reality of the situation.

        • http://twitter.com/VelizCF CFV

          Thanks for your responses.

          Mark: I wasn’t able to find Glenn Whitman article in Critical Review. I I will check Cowen/Crampton. Your second point is more subtle. But, as far as I can see, it is not an argument against minimum wage laws per se. And all the regulators would have to know (to not to cause unemployment) is that the minimum wage laws they enact is below the efficiency wages paid in this or that sector or within the economy as a whole.

          Matt: I haven’t read it carefully your article, and I will do it in the foreseeable future. However, at first glance, your discussion seems to be different: you (and Powell) put into question if sweatshops could pay according to the efficiency wage hypothesis (and your answer seem to be negative). But you do not discuss the effects of minimum wage legislation. Now, suppose two industries: A and B. In A wages are paid according to EWH: $5. In B wages are paid at $2. A minimum wage law of, said, $4 will have no effect in unemployment (provided that’s the equilibrium price).

          3cantuna: I don’t know how Austrians could make a meaningful contribution to an empirical controversy, when they claim that economics laws are synthetic a priori. For them, there is no factual evidence to even bother to consider in the first place: all we have to do is to apply our knowledge of praxeological propositions.
          Maybe you would want to read this piece? http://econfaculty.gmu.edu/bcaplan/whyaust.htm

          A more general comment: I need to check this more carefully (Ashton?), but if my memory is not fooling me now, during the industrial revolution in England in the XIX there was very high unemployment and no minimum wage laws. The unemployment was due to a fast technological change.

          • 3cantuna

            CFV,
            I could be wrong. But here is my 2 cents anyway.
            The logical positivists, as well as their cousin Popper, threw out the baby with the bathwater. Yes, historicism and metaphysical pronouncements are troublesome for science. But it is just that ‘synthetic a priori’- often maligned as metaphysical–that gives economics its unique place. Economic propositions, derived deductively, refer to the empirical situation because they are about acting man. Can you get more realistic than this? Are we not creatures that intentionally use means in effort to reach ends? What is a minimum wage law? Why wouldn’t there be logical implications?
            At any rate– it is a lot easier to list events– as Prof. McCloskey has in grand fashion– than to discover the economic logic that explains events: and even identifies the rational framework by which the events themselves were recognized and selected in the first place.
            So, actually, some of McCloskey’s critics on facts here are partly right. But not for the reason they think. It is that McCloskey is too positivist that makes her claims weakly defended.
            What’s more remarkable, the colorful use of fireworks, or their actual discovery?

          • http://independent.academia.edu/DannyFrederick Danny Frederick

            Popper opposed logical positivism; he even claimed to have killed it; and he was dubbed by Neurath (of the Vienna Circle) ‘our official opposition.’ Popper argued that science begins with metaphysics and that the big advances in science develop out of metaphysical speculation. He even proposed his own indeterministic ‘metaphysical research programme.’ It is a mistake to read secondary sources on Popper, since very few of them have the first idea of what Popper was about. Read the man himself; but avoid the temptation to think that he can’t mean what he says and then go and interpret him as some kind of positivist. Pick almost any unquestioned assumption in contemporary philosophy – Popper rejects it (and rightly so). Apart from the claims for a priori self-evidence, Austrian economics sits very well with Popper’s philosophy. Kirzner on entrepreneurship sounds like a dedicated Popperian.

          • 3cantuna

            Thanks Danny,
            I look forward to reading your fine comments. You are the second person of note to warn against secondary sources on Popper. I have my marching orders.
            My initial impression has been this:

            Logical Positivists: Seeing is believing. Science is induction.

            Popper: It is impossible to prove by seeing because all instantiations of a proposition can never be observable (induction is out). Hence, the Popperian solution to the problem of demarcation between science and non-science: A statement must at least be falsifiable– essentially act as though if 100% observability were possible then the truth would be discovered.

            Of course, it goes way further than this. I am just beginning to ever so slightly grasp Kuhn v. Popper, realism v. naturalism, probability, problems of induction, Bayesianism… maybe will never get there.

            The rejection of the Misesian a priori is a giant issue, it seems to me, and one that Popper inherits from the positivists. no? This might even be the spot where more hardcore apriorists criticize Kirzner. Not sure.

          • http://independent.academia.edu/DannyFrederick Danny Frederick

            Thanks for the compliment. I’ll just make some brief comments.

            All observation statements are theory-laden and might eventually be discovered to be false. A universal theory cannot be verified by any finite conjunction of observation statements, even if the latter were known to be true. There is no such thing as induction: possibly-mistaken theory precedes observation and informs it, and the only way to get to a new theory from observations is to make a guess. The best thing we can do with a guess is to criticise it, including empirical criticism (experiments). Our guesses are not usually testable: they need a lot of development, including development of related ‘auxiliary’ hypotheses, before they yield a prediction which.conflicts with a conceivable observation statement (and is thus ‘falsifiable’). In the face of all this, the way to avoid epistemological nihilism is to make some decisions and adopt some procedures (‘methodological rules’). Although this should allow us to make progress, it may not get us to truth, and even if it did, we would never know it. In any case, it is more plausible that all our theories are false. But the history of science shows that, with methodological discipline, perseverance and imagination, we can get better theories than we had previously. Nothing like positivism there!

            I am a big fan of Kuhn as well as Popper. The difference between the two is much exaggerated; it is more a matter of emphasis. Lakatos was a step backward from both of them (though he tried to fuse the two).

            I think Popper’s rejection of the synthetic a priori was a consequence of the Einsteinian revolution. Even Newton’s theory, which Kant thought he could prove a priori, turned out be refuted empirically.

            For me, on the other hand, the crucial thing is Russell’s paradox. Frege thought he could derive the whole of arithmetic from a priori self-evident axioms. Russell showed that Frege’s fifth axiom was, not only false, but self-contradictory. Prior to this discovery, Russell had thought, with Frege, that the whole of maths could be proven from logic. After this discovery, Russell thought that even logic was hypothetical. Recent developments in logic have borne this out: there are all manner of mutually inconsistent logical systems available nowadays: some deny the law of double negation, or the inference of p from p-and-q, or modus ponens, or even the law of non-contradiction. If this is the situation in logic, who in his right mind could maintain that economics is a priori self-evident? That, at least, is my view.

          • 3cantuna

            I commented before spotting this entry.
            On Russell, Frege and the possible undermining of traditional logic, all I can say is that I am in total awe- and rather unprepared to comment. This is part of the fun though, right?
            I can imagine that a defense of apriorism in economics will accept the criticism of a rationalism that looks like it descended from Descartes. After all, econ is about human action, and its deductions necessarily refer to real world human events in the way that math does not. The subject is a human being which, uniquely, happens to be the essence of the observer too. Whether the law of non-contradiction has been nullified for human action purposes is an open question. Mises et al. never claimed that apriori certainty in the social sciences was applicable to physics or ‘all knowledge’. Quite the opposite. Mises was a rationalist minus the contructivism, if I use the latter term appropriately.

          • http://independent.academia.edu/DannyFrederick Danny Frederick

            Yes, it is all part of the fun: discovering just how little we actually know for sure. But it is only a small minority of logicians (dialetheists) who reject the law of non-contradiction. I am not one of them. I think the law of non-contradiction is true. But the fact that expert logicians have argued, on logical grounds, for systems in which some self-contradictions are true, does show that the law of non-contradiction is not self-evident.

          • 3cantuna

            That Popper recognized metaphysics as inspiring scientific discovery still does not solve the issue of demarcation concerning Austrian theory. Tyler Cowen, e.g., has even posited that much of Misesian thought should be viewed as akin to poetry and other non-scientific but meaningful nonetheless knowledge.

          • Deirdre McCloskey

            Dear 3cantuna,
            One last remark to what seems to be a within-GMU-Austrian discussion. My suggestion, meant to be helpful: get out more, and in particular get outside the Popperian framework, which is only a halfway house out of the self-contradictions and lack of sociological or historical grounding of a logical positivist approach to science.
            Just a grumpy old lady’s suggestion.
            Sincerely,
            Deirdre McCloskey

          • 3cantuna

            Dear Grumpy,
            At first I was impressed that you took the time to reply to so many comments. But now that you have condescended twice and revealed a preference for quantity over quality, I am not sure. I am indeed currently reading on the philosophy of science— which you might have gleaned if you actually read my comment– not merely Popper. You really want to lose me as an ally? Probably because my criticism of your empirics sticks, hmmm? You can dispense with the ‘I am sorta Austrian now’ running for office speech too. I might not be sophisticated but you might not be streetwise.

          • Deirdre McCloskey

            Dear 2cantuna,
            All right. If you do not want me as an ally, turn to personal abuse. That usually does it.
            Sincerely,
            Deirdre McCloskey

          • 3cantuna

            Grumpy,
            I hate psychiatry– so please don’t give them ammunition with your projections.

          • Deirdre McCloskey

            Dear Mr. Frederick,
            I’m getting the two of you confused, but are you the one who spoke favorably of Feyerabend? If so, you surely can’t take Popper as The Last Word on philosophy of science. “Who killed Logical Positivism?/ ‘I,” said the Popper, ‘with my little chopper/ I killed logical positivism’.” [My take on a chapter in in autobiography.] But it’s not so. He saved a version of positivism, beyond which we have long got.
            Sincerely,
            Deirdre McCloskey

          • http://independent.academia.edu/DannyFrederick Danny Frederick

            No, there is only one of me, Deirdre. We differ in our interpretation and/or evaluation of Popper. I agree that the vast bulk of contemporary philosophy (and economics too) is still bedevilled by positivism. But that is in spite of Popper, who rejected just about every assumption of the positivists. As for Feyerabend, all that is best in him was lifted from Popper, while he simultaneously misrepresented Popper’s views in order to present Popper’s views as his own. In addition he gave Popper’s views an irrationalist and relativist twist which robbed them of their power. But he did make good use of Popper’s ideas in his historical studies and he did develop them constructively in some respects. I think the case study of Galileo in ‘Against Method’ was probably his best piece of work. I’ve read most of his stuff, much of it several times over, but I am ambivalent toward him.

          • Deirdre McCloskey

            Dear Mr. Frederick,
            I too have read much of Feyerabend (I fouind just now to my surprise that I own fully nine of his books: some, disgracefully, I’ve only pecked at) and I see what you mean by saying that his analysis of Galileo is his best work. Those passages stay with me (I feel the same about Lakatos’ Conjectures and Refutations), whereas “Fairwell to Reason” and all that seems contrived. Finocchiaro is my guide here, such as in The Galileo Affair (1989). You persuade me to think again about my attitude towards St. Paul.
            Sincerely,
            Deirdre McCloskey

          • http://independent.academia.edu/DannyFrederick Danny Frederick

            Typo: ‘Proofs and Refutations.’ Yes, that was probably Lakatos’s best work.

          • Deirdre McCloskey

            Dear Mr. Frederick,
            Oh, yeah—I should have got up ad checked it, but we old people . . . . Proofs and Refutations was his PhD thesis, but published after his much more conservative and cautious book that most people read.
            Sincerely,
            Deirdre McCloskey

          • David R. Henderson

            Deirdre,
            I’m Lakatos intolerant. (I couldn’t resist.) Great post, btw.

          • Deirdre McCloskey

            Dear 3cantuna:
            I feel I am intervening in a private conversation between you two! I’m glad you are educating each other about the actual philosophy of science.
            I’m not a positivist. But most people are. So in trying sweetly to persuade them it is wise, and fair, to address their sense of wie es eigentlich gewesen. There’s nothing tticky or dishonest or philosophicall inconsistent about coming on to other people’s (alas, misled) grounds of “Just give me the facts, Ma’am.”
            Sincerely,
            Deirdre McCloskey

          • 3cantuna

            I have read the Caplan piece before. It is on my hard drive actually.

            Btw, how would one actually carry out a lab-like test of minimum wage laws? There are too many factors out of the control of scientists. How would the human mind be made constant? How would changes even be observable? (Even observation depends on a prior knowledge.

          • http://independent.academia.edu/DannyFrederick Danny Frederick

            You raise some difficulties here for empirical testing. But the proper response to the difficulties is not to throw up your hands in horror but to work out practical ways of overcoming them. That is what the physical scientists do. Here’s a simplified example.

            Newton has a simple abstract theory concerning the laws of motion and gravity that is supposed to explain happenings not only on earth but also in the heavens. How do we test it? To derive a prediction about, say, the motion of Jupiter from Newton’s theory we need ‘initial conditions’ concerning the mass, position and velocity of Jupiter and the Sun. These initial conditions are highly theoretical. Further, if these are the only initial conditions we use, our prediction may be very precise, but it will be far from accurate. For the motion of Jupiter is affected by the gravitational forces of all the other planets (amongst other things). So a great deal of background knowledge (i.e., further speculative theories) about the masses and velocities of these objects will need to be invoked.

            But this will still not give us any empirical prediction. For that we need information about the Earth, our position on it, and how we discover the motions of the planets. The empirical prediction will be tested by some person looking at a spot of light through a telescope. How much, or what aspects, of the image that he sees is due to distortions introduced by the telescope, and how much is due to the condition of the light from Jupiter at the point at which it hit the first telescopic lens? We need a theory of how the telescope works. (To appreciate the seriousness of this problem, see Feyerabend’s case study of Galileo in ‘Against Method’.) And what about the light? We can only compute the position of Jupiter from the properties of the light when it hit the lens if we know how fast the light travelled and on what trajectory. What is the speed of light? And how was the speed and path of the light affected by the media through which it travelled (so-called empty space and the Earth’s atmosphere)? Indeed of what are these media composed? And what is light? Is it a wave, a particle or something in between? And how is it affected by gravitational forces? There are a large number of complex and disputable theories about all this stuff; and without assuming such background knowledge, we get no empirical prediction. This is the Duhem problem (see his ‘Aim and Structure of Physical Theory’).

            Nevertheless, despite all these problems and complexities, physicists work out practical ways of testing theories and are even able sometimes to show that one theory is better than another given the current state of our knowledge. They do this by making assumptions, taking decisions, using approximations, idealising, using one thing as a proxy for another, etc. Social scientists can, and should, do the same. For a discussion of this in relation to Social Science, see Gordon Tullock’s ‘The Organization of Inquiry’ (which can be downloaded for free at Liberty Fund).

          • 3cantuna

            I do understand that Einstein’s moment was Popper’s inspiration. How fortunate for Einstein’s claims that Eddington’s expedition to- and observation of- the solar eclipse in 1919 was even possible? Hence Popper’s adjustment away from the logical positivists to falsifiable statements. As I slowly absorb philosophy of science it is becoming apparent that science is not a settled matter. That said, I will not be too conclusive by saying physics and method will never advance to the point of observing human action. Yet for now I remain firmly attached to the Austrian insight that even the physicist/observer must have meaning in hand in order to even identify ‘evidence’. Further, ultimate causes in natural sciences are still unknown and may never be discovered. In the social sciences, especially economics, human intentionality is the given ultimate cause– already in hand. Why this rather fundamental point is rejected is a rather fascinating subject.

          • http://independent.academia.edu/DannyFrederick Danny Frederick

            Popper also thought that human action could not be (fully) explained by physics. He subscribed to evolutionary emergence and free will; and he thought that social scientific explanations were in terms of intentional action and the rationality principle. The reason for the ‘(fully)’ is that what actions we perform depend upon physical laws: to explain fully why I switched the light on we need to refer not only to my intentions but also to the laws of electricity, the laws of motion (the force from my finger flipped the switch), etc.

          • Deirdre McCloskey

            Dear 3cantuna:
            I recommend Knowledge and Persuasion in Economics (1994), but I’ve gotten a little beyond it by now, to the very matter of meaning you mention: “the physicist/observer must have meaning in hand in order to even identify ‘evidence’.” “Having meaning in hand” is the task of the humanities, which means that we need a humanomics. I am a near-Austrian by now, ad think that integrating language and meaning into economics is a natutal extension of the Austrians (especially the George Mason branch).
            Sincerely,
            Deirdre McCloskey

          • http://independent.academia.edu/DannyFrederick Danny Frederick

            I should have mentioned that I have a forthcoming paper on Popper’s approach to social science, which is available here:

            http://independent.academia.edu/DannyFrederick/Papers/1269685/Popper_Rationality_and_the_Possibility_of_Social_Science

          • Deirdre McCloskey

            Dear Mr. Frederick,
            You make eegantly the point that I made at length in Knowledge and Persuasion in Economics (1994) and earlier works, right down to the use of the admirable Feyerabend. My way of putting it is to say that science is rhetorical, whicch is merely to say that it is a human argument. Duhem’s Dilemma has not yet been grasped by most economists who think they follow Friedman’s 1953 essay. Not grasped after a century.
            Sincerely,
            Deirdre McCloskey

          • russnelson

            There is no need for empirical testing. That horrorshow has already happened. In the 1930′s, a minimum wage law was accidentally applied to Haiti as well as the continental U.S. The wage rates were considerably lower in Haiti, so this increase had the effect of doubling the minimum wage. Consequent to this, none of the employers making hand-tatted lace could afford to pay their workers. They had to move away, and most of the lace industry workers became unemployed.

            We KNOW that minimum wage laws cause unemployment, as if such a thing needed proving. The only thing currently unknown is: what’s the largest increase in a minimum wage law that can be passed without causing any discernable unemployment.

          • Mark Pennington

            ‘all regulators would have to know is that the minimum wage is below the efficiency wage level in this or that sector or in the economy as a whole”. That’s the point – this would be a massive informational problem! The market is imperfect but the competitive process generates its own mechanisms to deal with efficiency wage dynamics (a couple of papers in Cowen and Crampton are v good on this). The market generated price for labour is unlikely to be the ‘right price’, but given the countless different factors that affect what the ‘right price’ is to clear the market, it is more likely to be in the ball-park than attempts to centrally impose prices by regulators and politicians – even assuming that the latter are acting with benevolent intent. In practice of course, the process that determines the minimum wage as is the case with many other regulations, is also likely to reflect special interest bargaining and political grandstanding.

          • Deirdre McCloskey

            Dear Mr. Pennington,
            You say it well. It is an empirical question, and there is to put it mildly no guarantee that the US Congress or the Illinois Legislature will set the wage correctly.
            It goes back to the issue of “workplace democracy.” Just the worst place for majority vote and logrolling is inteference in mutully advantageous exchanges.
            Sincerely,
            Deirdre McCloskey

          • Deirdre McCloskey

            Dear CFV,
            It is devilishly hard to make such comparisons, but no, unemployment was not higher in the nineteenth century.
            The efficiency wage stuff strikes me as speculation unbackeed by science. Of course one can make up a theoretical possibility that, say, demand curves slope upward or that exactly 16 angels can dance on the dead of a pin. So what? The speculation sounds like the unanchored existence-theorem “economics” that I and Ronald Coase and the (alas) late Eleanor Ostrom and other fact people have tried to stop. You cannot proe anything with statistics, contrary to the proverb. But you can indeed prove anything with “theory” unattached to fact.
            Sincerely,
            Deirdre McCloskey

          • russnelson

            I’m not familiar with anyone, present or not, who argues that all unemployment can be laid at the feet of minimum wage laws. Beat that strawman harder, Mr. V.

        • Deirdre McCloskey

          Dear CFV,
          I’m going to let Mr. Pennington answer, who is much better informed about the detail here than I am, but let me tell you a story. Joe Persky, a brilliant and left-wing colleague of mine here at UIC, and I proposed to the National Science Foundation to get together a group of people with differing priors and politics about the minimum wage to settle the issue. It certainly deserves to be settled. The money spent to do so would be a hundredth of the cost of the next space telescope, and gigantically more valuable for human welfare. The rule would be that you had to change your mind if the evidence said so, and you had to specify in advance what evidence would cause you to change your mind.
          No dice. Academic life wants people to go on casting grenades at each other over the parapet, not actually settle a Fact. (This is not a criticism of what I regard as a Good Government “Program,” the NSF. I can think of a hundred worse ways to spend tax money.)
          Sincerely,
          Deirdre McCloskey

      • Deirdre McCloskey

        Dear Mr. Pennington,
        Thanks. The point deeper than my Magnificent Standing, though, is, I think you realize, that our colleagues have not thought it possible that they may be mistaken. I dearly wish they would.
        Sincerely,
        Deirdre McCloskey

    • Deirdre McCloskey

      Dear Geoff Arnold,
      I am getting tired of being accused of a lack of humility when I have written many, many books and many, many articles giving in tedious detail the humble facts.
      In the case in point: What, Mr. Arnold, do you suppose most prevents MacDonald’s from poisoning you with its next hamburger, the few inspections the city gives, or the fear of lost business if you die and your death is reported in this blog (the idea that “media monopolies” therefore justify the greater monopoly of violence in a government is at least something you ought to think through)?
      I am gesturing towards a large literature. Perhaps you should read it before waxing indignant.
      Sincerely,
      Deirdre McCloskey

      • russnelson

        Somebody should try poisoning Tylenol. Again.

    • russnelson

      Geoff, I AM a Quaker, and I can verify that Deirdre’s version of events is accurate, at least as far as I know my Quaker history.

  • Todd Seavey

    The greatest blog entry ever written.  Thank you.

    • Deirdre McCloskey

      Dear Mr. Seavey,
      Good Lord, I think not! But thanks: authors live on such remarks, sparse though they are!
      Sincerely,
      Deirdre McCloskey

  • Jessica Flanigan

    Hooray! I enjoyed this post.

    I mean, I’m basically a kantian, so I also don’t really care too much about how the facts go. If a community of freedom and respect had less happiness or whatever, (i.e.. if paternalism and regulation really would make people happier) I don’t think that’s what matters because I don’t think that freedom is justified in the service of happiness or any other values.

    That said, I agree that Anderson and Freeman seemingly do care about these outcomes, and they are writing with empirical premises that are probably not justified. Still, my intuition is that your take on the facts is also probably not the unbiased one. After all, don’t we all think that in some important respects Scandinavian government has better outcomes than the US? I don’t mean this to be the heresy that the anti-UBI commenters will surely accuse me of. Many european welfare states rank higher on the heritage foundation’s index of economic freedom than the US, so libertarians and high liberals should agree at least on that real-world point about which institutions are better.

    Once we leave the realm of ideal theory, my guess is that an all out free market type system wouldn’t ::necessarily:: have the best outcomes, you could be wrong about the consequences too. But then if such a system is more free, who cares?

    • Deirdre McCloskey

      Dear Ms. Flanigan,
      I admire your unconditional attachment to liberty. But as you point out, much of political philosophy in fact relies consequentially on factual premises, many of which are not examined. I do not claim to be “unbiased,” merely to have an idea of what my biases are. I do wish my High Liberal friends knew their own (factual) biases!
      As to Scandinavia, I have an unpublished piece “Sweden is Capitalist,” against the biases of the left uncritically in favor of or of the right vehemently hostile to a country I know and love (I teach their yearly), and making your point.
      Sincerely,
      Deirdre McCloskey

  • http://pulse.yahoo.com/_A57XFCQO6XNUHFAVZOYXVPQ56Y David

    You know, I’ve occasionally remarked that libertarians sometimes demonstrate an inability to disaggregate the state and its various functions in a way that distorts their analysis and thinking. I’m bookmarking this post for the next time someone tells me that’s a strawman. D.M. doesn’t bother to make an argument for her extremely odd view that there’s no reason to think about Belgians in the Congo and, say, OSHA as conceptually distinct in any relevant ways because THE STATE. In the context of a post exhorting others to render their historical accounts more sensitive to factual intervention. I’ve long been a pretty big fan of McCloskey’s scholarship; this is so hackish it’s difficult for me to imagine it was authored by the same person who wrote The Rhetoric of Economics.

    • http://www.facebook.com/profile.php?id=503269236 Lynne Kiesling

      David, please see Mark’s reply above for the lineage behind Deirdre’s argument in this post.

      • Deirdre McCloskey

        Dear Lynne,
        Less, “lineage” is just the word. As I said above, I rely also on the work of colleagues, such as Lynne Kiesling.
        Love,
        Deirdre

    • Tkwelge

       I think that you missed the point entirely.  DM doesn’t argue that all state interventions are wrong.  She simply argues that it is impossible to say that the government is a slam dunk solution to the problem of externalities and asymmetries of information.  After all, governments have created more asymmetries of information, not less.  How much do you understand all of the rules and regs in your own town alone?  And history has revealed that the government is much more likely to failure “societal efficiency” over any one victim of an external aggression time and time again.

      • Deirdre McCloskey

        Dear Tkwelge,
        Exactly.
        Sincerely,
        Deirdre McCloskey

        • http://www.facebook.com/profile.php?id=1091737052 Chad Horne

          “Externalities do not imply that a government can do better.”

          That’s not correct. Externalities don’t imply that a government WILL do better, and in fact often a government won’t do better. But the existence of an externality does imply that a government CAN do better.

          • russnelson

            It does?? I would give you “MIGHT”, but never “CAN”. All I need to do to disprove you is show one instance in which there are externalities which a government cannot improve upon.

          • http://www.facebook.com/people/Jorge-Emilio-Emrys-Landivar/37403083 Jorge Emilio Emrys Landivar

            Incorrect.
            “But the existence of an externality does imply that a government CAN do better.”

            Think about what an externality is. An externality is when someone not involved in the transaction bears a cost for a transaction. By that definition just about everything the government does /is/ an externality.

          • http://www.facebook.com/people/Jorge-Emilio-Emrys-Landivar/37403083 Jorge Emilio Emrys Landivar

            Furthermore, the existence of an externality does not imply that rectifying that externality is positive. (In order for it to be so, you have to make certain assumptions about interpersonal utility comparisons that are silly.)

            Example:
            A person who is quietly racist against hispanics faces an externality from my mere existence. Does this mean that taxing me and giving the money to the racist would be more efficient? NO! It would actually make the problem worse, and encourage racism.

    • Deirdre McCloskey

      Dear David,
      You have clearly not read enough of my books, which is a terrible sin! I wrote two very long books recently documenting such matters (The Bourgeois Virtues [2006] and Bourgeois Dignity [2010]) , so you can hardly fault me for not backing up my claims: I had two pages here to do what 1000 pages did, not to speak of the hundreds of books and articles by colleagues on whom I rely.
      Of course I do not regard OSHA and King Leopold II as being on the same level of evil. But there is no “distortion” involved in thinking that both have not done what they should have done (namely, abolish themselves; stop doing what they are doing).
      I do not know why my leftish friends—especially the US-nomenclature “liberals” who think of themselves as middle-of-the-road, moderate, non-ideological, practical—are so tender towards the state, which does the varied things, evil or merely stupid, that I listed, and could easily be relieved of the good things it does (education, roads, most courts, most police). When James Scott, the political scientist from Yale, gave a talk to 150 people this spring at UIC called “Two Cheers for Anarchism” I asked him why he and I were the only (2/3) anarchists in the room. My colleagues were startled, and rushed up to me making arguments about internal improvements in the 1830s and the like. Jim was not startled, I think, since he’s thought through historically the many reasons not to think well of state action. He and I think well of: Compulsory innoculations. Defense against Canadian invasion. Laws against force and fraud. That’s about 2% of what the US state now does.
      Sincerely,
      Deirdre McCloskey
      Deirdre McCloskey

      • russnelson

        Arguing in favor of internal improvements??? Sorry, Deirdre, but what the hell?? Do these people not know that New York State had had enough of “internal improvements” to make funding of private corporations unconstitutional in the middle 1800′s? And for good reason, because millions were wasted on canals and railroads that were not profitable. The Chenango Canal didn’t even pay for its capital cost much less its operational cost. The Canajoharie & Catskill was so incompetently run that its sole locomotive was trapped behind a collapsed bridge, for which funding to repair was never made available and the locomotive had to be scrapped in place.

        • Deirdre McCloskey

          Dear Mr. Nelson,
          You see to know a lot that I don’t, and are therefore a very good person to listen to. But, yeah, my American historian colleagues always mention internal approvements in the Age of Jackson and beyond as evidence that we can’t get along without a lot of govt.
          The story of the great cross-Sweden canal, I just learned last month, is similar. It was built mainly with, of all things, conscripted soldiers! You can well imagine how profitable it was, and had the problem that all such Glorious Projects had in the era, of coming unhappily just before railways.
          Sincerely,
          Deirdre McCloskey

  • http://www.facebook.com/profile.php?id=503269236 Lynne Kiesling

    Brava, Deirdre. Well said.

  • Greg G

    No Professor McCloskey, I don’t “want to reject these factual findings because they are ‘right-wing’ or ‘libertarian.’ ”   To the extent that I want to reject them (only a little) it is for other reasons.  I do often lose interest in right-wingers when they sound intolerant.  And I do often lose interest in libertarians when they simply whine about every policy dispute being a violation of their rights.   You seem delightfully free of those vices so thank you for that.

    It’s not so much that I disagree with your “factual findings”; it’s that they leave out so much.  Absent from your quick tour of 19th and 20th century history and economics is the very thing we care most about.   On the whole, we are living in the most free and prosperous society in human history.  This is not something you should lose sight of when lecturing people on a lack of historical perspective.

    Now some of this improvement is because of government and some of it is in spite of government.    Those of us who believe that government action is to sometimes be defended do not believe that government “will not be regularly corrupted” as you characterize us.  Many of us believe that all human activities will be regularly corrupted but we should soldier on anyway.

    When people become more prosperous they demand more services of all types.  Like it or not, that includes government services.    

    • Deirdre McCloskey

      Dear Greg G,
      I do ask you to read my books before assuming that I overlook that we are living in the most free and prosperous country in human history. (Your flourish in what is otherwise a thoughtful intervention is a good example of what is unattractive about such conversations: people in the blogosphere feel impowered [which is all to the good] to sound off about things which they have not read anything about or devoted much thought to [which is all to the bad].)
      Yes, people “demand” services from government, whether or not the government is competent to “provide” them, and whether or not the “services” are worth having (education better provided privately; subsidies to this or that member of the upper middle class; endless wars; drug raids in the middle of the night). Mencken put it well: “Democracy is the theory that the people should get what they want, and deserve it good and hard.” That is the puzzle of keeping our liberties even when we want to be “protected” (say) from the extremely remote chance that the Grand Union in St. Albans, Vermont will be soon attacked by Muslim radicals.
      Sincerely,
      Deirdre McCloskey

      • Greg____G

        Professor McCloskey,

        It was only this blog post, not your books or your more general knowledge, that I criticized here. I thought I made that clear by referring to my remarks as applying to “your quick tour of 19th and 20th century history and economics.” Sorry you found that “unattractive.” I am aware you have produced an extensive body of scholarship I have not read. Perhaps your understandable irritation with other commenters has spilled over here. I find your suggestion that I “have not devoted much thought to” the things I am sounding off on to be unattractive as well. But, by the standards of the internet, this is all extremely polite, so I guess we should be thankful for that.

        I am glad you mentioned your contempt for democracy because that is the very thing I find most wrong with libertarianism. For all its many faults, constitutional democracy is one of mankind’s greatest achievements. It is quite literally a marketplace of ideas and political solutions. It is ironic that the most ardent defenders of market economics do not see that more clearly.

        Libertarians are quite understandably irritated when they are charged with expecting the market to solve all problems. They naturally reply that that they simply think that, despite their shortcomings, market solutions usually work far better than the alternatives.

        I make the same claim for constitutional democracy. Yes, it has all the problems that plague every form of group decision making. Why would we expect otherwise? Sometimes we have to make decisions as groups (nations, cities, families, corporations) and sometimes we need to make decisions as individuals.

        Those of us who think that political freedom is even more foundational than economic freedom (which I do usually favor) do so because of our historical perspective. Constitutional democracy allows people to settle their disputes peacefully. It always gives you another bite at the apple when you get it wrong. And it is very highly correlated with good economic outcomes.

        Greg G

        • Hume22

          “Those of us who think that political freedom is even more foundational than economic freedom (which I do usually favor) do so because of our historical perspective. Constitutional democracy allows people to settle their disputes peacefully. It always gives you another bite at the apple when you get it wrong.”
          You must possess a very weak normative conception of “democracy” and “political freedom” if you think that the modern regulatory nation state permits “we” and “us” to set “our” disputes. The United States is a particularly egregious example of a morally bankrupt “democratic” regime (single-member district system, vague and vast ‘delegation’ of policy-making and law-making power to unelected administrative officers, two-party system, etc. etc.).

          • Deirdre McCloskey

            Dear Hume 22,
            Precisely.
            And note that if you scratch a sweet High Liberal you find an authoritarian Rousseauian underneath—that is to say, someone with great affection for “programs” that “we” do. I do not need to mention Stalinist collective farms or Maoist cultural revolutions to make the point, so I won’t.
            Sincerely,
            Deirdre McCloskey

          • Greg____G

            Professor McCloskey,

            You quite understandably object when people make uncharitable assumptions about your motives (such as suggesting you are not a nice person or don’t care about the poor). That is a good thing. You should call them on that.

            And yet you write as though being naive, authoritarian or unwilling to think independently, exhaust the possible reasons someone might disagree with you.

            So which government interventions serve to minimize violence and maximize liberty? Reasonable and thoughtful people can, and do, and always have, disagreed about such matters. Settling these disputes is not simply a matter of “fact” finding. Different people have different values and judgments which the reason we need liberty in the first place.

          • russnelson

            But Greg, Deirdre is pointing out places where the leftist narrative describes goal X, and yet result Y is achieved. She intends that this should create alarm, and yet you seem complacent. Your words seem to suggest that a different goal other than X should be sought, but, really, that doesn’t change the fact that Y happens.

          • Greg____G

            Russ,
            Yes, shit happens. Or as you say “Y happens” despite the fact that the leftist (and/or the rightist) narrative intend some other goal. I am not complacent about that but it is entirely possible I may not be able to summon the level of alarm you require.

          • Deirdre McCloskey

            Dear Greg G,
            I point out an authoritarian strain in left thought. There is nothing original about the point—consult Edmund Wilson, To the Finland Station. There is an authoritarian strain in right thought, too. And, to come to the present case, in the middle of High Liberalism. I’m from the government I know how to make you happy (see my essay in this week’s New Republic)
            Yes, you are right. Facts alone will not settle all the issues. But I suppose you agree that it is relevant for determining if, say, the invasion of Iraq by the government of the US is (or was) a good idea to look into facts, and to draw the ones found relevant to the attention of people (e.g the bush administration) who seem to be ignoring them.
            Sincerely,
            Deirdre McCloskey

          • Greg____G

            Professor McCloskey,

            So anyone who wants the government to do more things than you do is dismissed as an authoritarian. We get to choose between being 2/3 of an anarchist or an authoritarian. Rothbard called Milton Friedman a statist. And so it goes. Yawn.

            There are plenty of people who oppose compulsory vaccination and would consider you authoritarian for wanting to force them into such a program. There are a few people who would prefer to hire their own private security rather than be taxed to have the state protect your possessions from theft. And so it goes. This is exactly why libertarianism doesn’t really ever progress beyond righteous indignation.

          • ThaomasH

            More on the anatomy of the “High Liberal.” It might even be true if the species exists or not confined to a few academic zoos.

          • Greg____G

            Hume22,

            Just curious, if “The United States is a particularly egregious example of a morally bankrupt ‘democratic’ regime” then which are the more routinely morally upright regimes?

        • Deirdre McCloskey

          Dear Greg G,
          I did not say I have contempt for democracy. I quoted with amusement Mencken, who did. On the contrary, I regard democracy (an essentially contested concept: I would go with Tomasi’s definitions) as the worst system. . . except all those others that have been tried from time to time. I am a practical democrat, more so, it seems to me, than many of my High Liberal friends, who take such a dim view of “consumerism” and other vulgarities of hoi polloi. I teach at state universities, I who had tenure at the University of Chicago. I am a progressive Christian, who tries to treat the least of my brethren with respect. And so forth. (Like you High Liberals, in other words, I am a Really Nice Person.)
          “Making decisions as groups” means, of course, “reaching for the monopoly of violence.” Unless you have a Rousseauian notion that somehow the volonte general emerges and we all agree, evry one of us, violence is what group decisions imposed on everybody are about. I of course favor discussion, and voting, and compromise, and try to follow them in my life. But I want as many matters as possible to be markets or morals, exchange or grace; and as few as possible to be rules and taxes enforced by the DEA or the IRS. Don’t you?
          Sincerely,
          Deirdre McCloskey

        • Wilson263

          GregG,

          Democracy is a market in which one does not pay for one’s choices, and often does not receive the product of one’s choosing at all. Which is to say, democracy isn’t a market.

          • Deirdre McCloskey

            Dear Wilson263,
            Yes. There are three ways of acquiring goods and services: exchange, gift (such a from parent to child), and violence. Government is the realm of violence. That’s not always bad. If someone doesn’t want to get vaccinated I want government to use violence if necessary to get her to do it, since if she doesn’t do it I get sick (say” my biology here seems a bit unsteady). If someone wants to steal my computer I want government to use violence to stop him. But if it’s not always bad, it’s often bad. Very bad.
            Sincerely,
            Deirdre McCloskey

          • Mendizale

            Interesting, Wilson–I bet that for every choice made in a market, I or you or another of my many betters could find a (reasonable) way in which the chooser did not pay fully for the choice (or, did not benefit fully from it). At their best, open democracies offer the hope of making these choices and trade-offs explicit, though. And I don’t think this hope is exclusive to any one political philosophy, although there are certainly some that do not share it. Obviously, none of this is to say that open democracies are always at their best–but you would be hard-pressed to show that unregulated markets are, either. I think this duality is the main point of Deirdre McLoskey’s long but much-needed rant*…Long because government interventions and actions have produced many (un)intended, harmful effects, and much-needed because the litany of free market criticisms constitute the norm in much of our public discourse. I got away from myself here. The point is that you may be correct–democracy may not be a market–but this is definitely not proven by implying that choices are paid for in a market. It is not only a non sequitur, it speaks neither to the argument nor from the evidence. *I’m not sure what the right word is here. “Rant” captures the long, list-y quality of the post, but not its dispassionate, evidential qualities. Either way, not meant as a criticism.

          • Wilson263

            @mendizale:disqus No doubt one could, but do you really mean to suggest that the externalities generated from, say, buying a loaf of bread (or any other normal market transaction) are greater than the externalities of voting for this or that policy? That seems self-evidently absurd.

            I deny that open democracy makes any such trade-offs explicit; quite the reverse, in fact. Since an individual vote has essentially zero value in determining the outcome of an election, individuals themselves face no relevant trade-offs when deciding how to vote. And as such, democracy cannot be a “marketplace of ideas and political solutions”, as GregG said.

          • Mendizale

            I’m sorry Wilson, I mean no disrespect, but these things you mention are not persuasive arguments—not in theory, in logic, nor in fact. A few examples of what I mean, starting with your bread reference. “Bread” is a fairly differentiated product: there’s Wonder bread, artisan bread, gluten-free bread, multi-grain, heritage grain, organic, fair-trade, bio-dynamic, local versus far-flung, et cetera. My choice to buy one type on a particular day is a function of many things, including my preferences, ability to pay, and information/awareness. And this bread purchase on this day sends market signals (to purveyors as well as producers) about what to sell and to make that at the margin may be weak, but that in aggregate may be very strong indeed. The rise of Whole Foods, locavory, and farmers markets illustrate how markets respond to powerful and growing demand signals for more sustainable food (or at least for food that is perceived to be more sustainable). While I never suggested that the consumption externalities are greater than those of voting for something, it is certainly not self-evident that this is impossible in some cases. For example, the petroleum market is highly distorted for a dizzying number of reasons (some of them governmental), but it is clear that the price of gas does not reflect it’s true cost, as our microeconomics texts suggest that they would in an ideal market. Part of this cost gap (true cost minus market cost) is made up of externalities (environmental, health, et cetera); proper government intervention has the real possibility of improving market efficiency by intervening. Of course, this intervention could be bad if it’s poorly laid out, inflexible, and not up-dated frequently to reflect new realities. But it’s still important to remember that markets and governments have effects, some of these are externalities, some of these are negative, and whether positive or negative depends on where you sit in the transaction. I think one of McCloskey’s main points is that it is not enough to be aware of market failings, we need to also be diligent/vigilant about governmental failures, and that both theory and history have a lot to tell us about both. Now, you’re second paragraph/argument suggests the following logical chain: since (1) an individual vote is essentially worthless in effect, (2) a voter faces no real trade-off, therefore (3) a voter’s trade-offs are hidden (not explicit), therefore (in conclusion) (4) democracy (or a vote) is not like a marketplace (or a purchase). Before responding to this, it would be helpful to know if it’s a fair characterization of your thinking (and I hope that it isn’t).I’ll leave aside the perplexing question of how, in your view, a vote is both worthless in effect and yet greater in impact than a market transaction.

          • Wilson263

            Nothing you wrote about bread seems to undercut anything I wrote – when you buy something you want in a market the benefits (and costs) go primarily to buyer and seller. Where’s the bread externality? How much of the total value of the transaction is external? How does that compare to the value of voting (where the only value is your limited ability to use force against others – a 100% externality)? Not favorably, if you’re trying to make the case that democracy is like a market in forcing trade-offs.

            Since voting is effectively a pure externality, it’s impossible be less of a market transaction. Can you think of a normal market transaction where basically all of the value is external? I can’t.

            Your summary is basically accurate.

          • Mendizale

            I’m sorry, I seem to have failed entirely–my writing on bread was intended to show, among other things, that the benefits and costs of the bread purchase are not (at all) limited to the buyer and seller. The transaction, at the margin and in the aggregate, ripples through to the distributer, the farmer and her practices, the transportation sector, the seed growers and savers, Monsanto, genetic researchers, synthetic/organic fertilizer/pesticide producers, and more. Nowhere on this flow are the costs or benefits completely reflected in the price, and so it follows that they are not reflected in the final price of whichever bread type is in question. One problem is that the externalities of wonderbread– such as industrialized monoculture (with many weird subsidies), soil depletion, nutrient depletion/relocation and application of synthetic additives (fertilizers, pesticides) the magnitude of whose health and environmental effects are hard to measure (but whose +/- sign is not), and health effects of eating sugary white refined bread (diabetes, etc)–are mostly negative. The externalities for organic whole grain bread are both fewer, and mostly positive. These are empirical questions, and benefit-cost and other analyses with rigorous, transparent methodologies exist for many of them.

            To the other point, simply saying that voting is valueless (as you did in the earlier post) doesn’t make it so, nor does asserting that its value lies in (limited) coercion, and that this is a 100% externality, make those things true. Assuming the voter is rational and reasonably well-informed (both stretches, but stretches still made in much economic modeling as well) and that the voter is a resident, he will have to live with the policies he is voting for. Not an externality. Exceptions exist, but they’re mostly when voting for moral issues (the old white Christian guy voting for what what women can do with their bodies, or with who is fit to adopt children (certainly not gays or folks with atypical gender identies, oh my oh no). And a strong case can be made that that old white christian guy really isn’t a “resident” in the policy area he’s influencing.

            So voting isn’t typically a total externality, whether negative or positive. And voting isn’t valueless (as you’ve claimed it is) in the margin or in the aggregate, and if it were (which you’ve claimed it is), then it can’t be worse than a market transaction. And since a voter will live with the results of the policies he or she votes for, there is in fact a trade-off, and in open democracy there is an attempt to make these trade-offs clear. These points have a strong bearing on the 1-4 logical morasse mentioned above (whose premises are incorrect, and whose form is questionable).

          • Wilson263

            So did you want to stipulate that for a purchase of bread all of the marginal value is external? I bet not. Even the “externalities” you listed (e.g., soil depletion, obesity) accrue to people in the market supply chain for the product (the farmers, the consumers). That is, they’re not even actual externalities.

            Can you point to the marginal value of a vote? How much would you be willing to sell your right to vote for a single election for?

            Voters aren’t rational specifically because democracy isn’t like a market – they face no trade offs based on their individual vote. Suppose there are three voters (among millions) in the same hypothetical election and they would all prefer the same candidate (he’s preferred by 80% of the electorate); one votes for his preferred candidate, one votes for the candidate he likes the least, and one doesn’t bother to vote at all. How or whether they vote is irrelevant to the outcome they receive.unless their vote is the deciding one. The lower the probability of having the deciding vote, the less value their vote has. Since in any typical election the chances of having the deciding vote are essentially zero, the value of any individual vote is also essentially zero.

          • Counsellor

            Democracy is a process, not a condition.
            It is a process often perceived in terms of the conditions necessary for its constituent actions.

      • Counsellor

        May I suggest that what is occuring when people “demand services of the government” they are actually seeking to use the mechanism of government to impose obligations on others or to avoid the burdens of obligations on themselves.
        ID: R. Richard Schweitzer
        b. 1924
        U.va. Col ’51; Law ’53
        s24rrs@aol.com

        • good_in_theory

          You could suggest it, it just wouldn’t make much sense insofar as people propose the imposition of obligations for which they would bear the burden.

          • Counsellor

            How now, if some are seeking services, would they go to the governmental mechanism to have that obligation to serve assigned to themselves? Non-sequitur?
            Does not “to be served” require the provision of service by others?
            Performing the obligations to provide “services” to one’s self (or one’s own) is contra-posed to “seeking” services through the mechanism of government.

          • good_in_theory

            “bearing the burden” does not equal specific performance. But thanks for the boring pedantry.

    • vidyohs

      “When people become more prosperous they demand more services of all
      types. Like it or not, that includes government services.” I’d like to see that backed up as something other than opinion, much less as proof that “wealthier” people demand more government services (which is what is implied). The wealthy people I know, and my own middle class self may want more services than I might find in a peasant village in outer Mongolia, but they/I do not want government services, I want market oriented services because they/I can negotiate terms and exercise critique over what I am buying. With government services it is a one size fits all, as is, deal and no rational person makes that the first choice when there is a market for the same services

      • Greg____G

        vidyohs,
        Pick any western democratic country you like and compare it with where it was 100 years ago. You will find that the residents there are now much more prosperous, and the voters there tend to expect many more government services than they did 100 years ago. I understand you would prefer that they don’t, but most do anyway, despite the anecdotal evidence about your circle of friends.

        • http://independent.academia.edu/DannyFrederick Danny Frederick

          We need to distinguish two claims:

          (1) as societies get wealthier, citizens demand their government to provide more services;

          (2) as societies get wealthier, citizens demand more of the services that happen to be provided by government.

          For example, as people get wealthier, they spend more on health services. In the UK, the bulk of health services are provided by the government. Thus (2) applies. But if health services had not been largely supplied by government, (1) would not have applied, unless rising wealth went hand-in-hand with a demand for nationalisation of health services. It might be that (1) is in general true. If it is, the explanation may lie in the rent-seeking that is inseparable from politics and in the spread of rent-seeking that accompanies greater wealth in democratic societies.

        • vidyohs

          Let’s see, you offer anecdotal evidence for your claim, but when you see the opportunity to criticize me for doing the same, you try to sting me with it. Sorry, that fails. It is not anecdotal to observe that most people become wealthy by exercising free choice and when they have succeeded they are rarely inclined to turn that choice over to a another party. They become wealthy by making their own way and they like to live by choosing their own lifestyle, even when it means paying twice for it.

          • Greg____G

            vidyohs,

            Yes, most people become wealthy by exercising free choice but some achieve financial independence by contracting with the government to provide the kind of military operations that taxpayers are coerced into paying for whether they approve of them or not.

            Which makes a pacifist libertarian like Professor McCloskey a particularly problematic ally for you.

      • Deirdre McCloskey

        Dear vidyohs,
        Yes, that’s the problem: it’s the one-size-fits-all problem with government that makes it clumsy when the item is not naturally a public good, such as education or hack licenses. Though come ot think of it, government is also and often pretty clumsy when the item IS a public good—witness the grotesque growth of military spending when we stopped calling its branch the Department of War; or the “public good” of Native-American policy.
        Sincerely,
        Deirdre McCloskey

    • LibertarianGrump

      Asserting one’s rights constitutes a whining vice? I’ll assume that’s a complaint about presentation and not content, to which I would only say that the 7 or 8 people who still care about human dignity find such whining at least somewhat persuasive.

    • miles tracy

      Soldier on to that gov. Grant like a good soldier. Completely removing morality from your actions. Soldier on good soldier. You clearly lack a classical education. Soldier on. You don’t need to know history.

  • http://www.facebook.com/profile.php?id=546092083 Terry Mcintyre

    It is not enough to point to “market failure” – the proposed solution must actually be an improvement; it is not logically permissible to wave a wand and say “a miracle happens, and a politician emits the Perfect Solution which Fixes Everything.”

    Politics suffers from market failures and information asymmetry at least as bad as markets do. A market consumer suffers directly from a market failure. The old adate “fool me once, shame on you, fool me twice, shame on me” applies. But when it comes to political failure, consumers are fooled over and over and over again.

    • Deirdre McCloskey

      Dear Mr. McIntyre,
      Spot on. The argument that “externalities imply the government should intervene” is a century old, from Pigou through Samuelson to the present. Never is the efficacy of the “solution” questioned. Sometimes the government is the ticket—by all means, let’s have the government prevent the burning of soft coal for heating. But again and again, as you say, the proposed solution is worse than the disease.
      Sincerely,
      Deirdre McCloskey

      • russnelson

        Some problems are simply difficult. Seeing that the market cannot solve, or solves badly, a problem, is not evidence that the government will do any better. There is a certain stickiness to government solutions, so even if, for a period of time, a government solution is better than a market solution, once that time passes, the government solution remains.

        • jhodapp

          This is such an under discussed point! I like to tell my friends who prefer government solutions, that if, government solutions could be tried and removed frequently, then it’d be a little easier for me to accept trying a government solution to a problem. The fact that it’s nearly impossible (at least in the U.S.) to get rid of a government implementation of anything, is a reason for great skepticism before allowing it to be implemented.

          • Deirdre McCloskey

            Dear jhodapp:
            Indeed. It took dynamite to close down the Interstate Commerce Commission (I mean fiigurative dynamite; I’m not THAT kind of anarchist, merely a 2/3 anarchist, Christian and pacifist.
            Sincerely,
            Deirdre McCloskey

        • http://www.facebook.com/people/Jorge-Emilio-Emrys-Landivar/37403083 Jorge Emilio Emrys Landivar

          Agreed, actually, its often evidence that the government also won’t be able to solve the problem either.

      • http://www.facebook.com/william.heasley.56 William Heasley

        Dr. McCloskey:
        Is it the proposed solution that causes the disease -or- is it the politico with notional proposition in hand that purposely creates the disease through first stage economic consequences to match the political time horizon. Stated alternatively, is the process purposeful rather than random?

        • Deirdre McCloskey

          Dear Mr. Heasley,
          Without supposing that all politicians are rats (that way lies fascism), I agree that there is a big, big problem of time horizon. Apres moi le deluge. We see it in Chicago right now, in which Mayor Daley and the governor and the powers in the Legislature sold the farm.
          Sincerely,
          Deirdre McCloskey

      • Reason Liberty

        I thought you guys at BHL were supposed to be the moderates, yet you hit us with “Never is the efficacy of the “solution” questioned.”

        which is clearly wrong, as Pigou himself noted this:

        “It is not sufficient to contrast the imperfect adjustments of unfettered private enterprise with the best adjustment that economists in their studies can imagine. For we cannot expect that any public authority will attain, or will even whole-heartedly seek, that ideal.”

        From http://www.econlib.org/library/NPDBooks/Pigou/pgEW31.html

    • http://www.facebook.com/profile.php?id=503269236 Lynne Kiesling

      To amplify this point: isn’t this point a market failure application of Kant’s “ought implies can” principle? In other words, that in order for an action to be moral, it must first be feasible … which substantiates the argument for studying history, political economy, and cognitive science when formulating moral theory.

      I thank Steve Horwitz for reminding me of this principle yesterday in a discussion we were having about this thread. Thanks to all participants for the thought provocation.

  • artcarden

    As I read what is above, she is summarizing the facts as we know them (and as she has laboriously documented in some of her books) in order to counter the assumptions and mistaken “stylized facts” of what she calls “the master narrative of High Liberalism.”

    As Mark Pennington has pointed out in a few comments below, Professor McCloskey has gone to the trouble of writing a couple of book-length treatments of the themes she discusses in this post. Here’s the Google Books Preview of Bourgeois Dignity.

    • Deirdre McCloskey

      Dear Art,
      As the French say, “you have reason,” as usual.
      Love,
      Deirdre

    • russnelson

      The canonical version of that reply is “I would have to write a book to adequately respond to your concern. Fortunately, I have: [Amazon URL].”

      • Deirdre McCloskey

        Dear Russ, if I may,
        Yeah. The other one is, “When I want to read a good book . . . I write one.”
        Sincerely,
        Deirdre

  • Jim Johnson

    Just a quick question. What do you mean by “fact”? Just wondering how it differs form any of the unpersuasive ways that Putnam sketches at the start of The Collapse of the Fact Value Dichotomy …? For, if not, then your assertion – and claim to the empirical high ground – is simply rhetorical. That may not bother you. But if we cannot draw a sharp fact-value distinction because it is difficult to define ‘fact’ in some non-question-begging way, I am wondering where this list of “facts” gets us.

    The point is simple – market failures do not automatically countenance the conclusion that government s will do things better. But nothing here countenances the contrary conclusion that we’d all be happy as clams in the utpoian world of ‘free’ markets. Sorry.

    • Deirdre McCloskey

      Dear Mr, Johnson,
      If you wish my views on epistemology you can have them, at length, in Knowledge and Persuasion in Economics (1994). You are using the word “rhetorical” in an unhappy way, as a synonym for bullshit. To cure you of this particular sort of anti-bullshit bullshit I cannot recommend enough a reading of The Rhetoric of Economics (1985/1998) and If You’re So Smart (1990).
      The list of “facts” gets us to asking whether High Liberals have thought through the scientific basis for their convictions. I didn’t say anything about happiness of clams, but I have written on what you call (I note the learned scare quotes) “free” markets at length, historically and, in theory, but I hesitate to add to your reading list.
      Sincerely,
      Deirdre McCloskey

      • Jim Johnson

        Ms. McCloskey,

        You’ll be surprised (perhaps) to learn that I’ve not just read your books but own a good number of them. They are invariably smart AND entertaining – perhaps a unique combination in my library! I have learned from you and your work. In that sense I was using “rhetorical” in ironic way. We, none of us, are exempt.

        What I’d like to know is simple. How do you differentiate, as you put it, between rhetoric and bullshit? I do not think that all of what you write above fall into the latter category; in fact I never said that any of it does. But as a rhetorical move – here in this post, not in your collected works – you are claiming the empirical high ground, in ways that presume the persuasiveness of various sorts of philosophical/theoretical claims, such as:

        (1) That your notion of “fact” is defensible in non-bullshit terms – Putnam makes clear in ways that you perhaps find persuasive that the concept of fact is thoroughly steeped in philosophical presuppositions. So asserting one’s command of facts is neither simple nor uncontentious. It surely does not automatically get you very far in grounding the authority of what you advance as the “scientific basis” of your own position.

        (2) That markets are best or most commonly defended in terms of innovation not efficiency. This is a conceptual decision about justification. Innovation (creativity) surely does not presume markets, and markets are defended (by actual economists of various sorts) in terms of things like efficiency (e.g., virtually all current Chicago-types) or freedom (e.g., Sen) … So your conceptual assertion is just that. And some fo us fiind that unpersuasive.

        We might go back and forth about some of the empirical claims you make above. But that set of disagreements would be framed by these sorts of philosophical/theoretical claims. Put otherwise, I don’t buy your self-desription as “a mere fact woman”; things are not nearly so simple as that.

        Best,
        Jim

        • Deirdre McCloskey

          Dear Jim,
          True: the mere fact woman has also written a bit on epistemology. As I said, if you want a full response where I defend my philosophy you’ll want to read my three books on rhetoric, and especially the most philosophical one, Knowledge and Persuasion in Economics (1994). I say there that asserting one’s command of facts is neither simple nor uncontentious. That is, science is rhetorical all the way down.
          If you want a full response to justifying a society of small governments and free markets (supplemented by grace) on the basis of innovation, not efficiency or liberty (nice though both of them are), you’ll want to read The Bourgeois Virtues (2006) and Bourgeois Dignity (2010), and put in an early order (hurry, hurry!) for The Treasued Bourgeoisie: How Innovaation Became Ethical, 1600-1848 (forthcoming U of Chicago Press maybe 2013, deo volente).
          Sincerely,
          Deirdre McCloskey

  • http://www.facebook.com/profile.php?id=193112608 Chris Bertram

    “Regulation of dismissal has led to high unemployment in Germany and Denmark”

    Is that a “fact”. Well how come unemployment in regulated Germany is lower than in the “at will” US and unemployment in Denmark is about the same?

    • http://whakahekeheke.tumblr.com Cal

      Your question would only be a good one if McCloskey had said regulation of dismissal were the only factor affecting the unemployment rate.

      Denmark has “at will” dismissal and more overall economic freedom than the US and Germany’s unemployment program consists largely of the government paying firms to keep unproductive employees working, which may or may not be better than the US unemployment schemes but it changes the unemployment numbers significantly. International comparison requires a complicated analysis of many potential factors affecting outcomes. Longitudinal data on single countries is more amenable. And it’s a strong ceteris paribus argument that making it harder to dismiss increases labor costs, increasing deleterious unemployment.

      It’s likely that McCloskey is referring to the rise in unemployment in Denmark in the late 80s and early 90s (above 10 percent) before the Danish neoliberal reforms of the 90s re: “flexicurity” which removed virtually all regulation of dismissal (while providing unemployment benefits which have recently been dramatically cut) and gave way to decreases in unemployment. Overall, Denmark is now more free-market than the US or roughly the same. Consult the indices of economic freedom and similar comparative work.

      Germany’s recent and dramatic decline in “unemployment” is a bit dubious insofar as programs like Kurzarbeit directly subsidizes “employment” by paying the wages of employees who would otherwise be laid off. It’s cheating and ultimately suboptimal inasmuch as it just unemployment by another name. But it’s still probably a better policy than most in many regards. And the lower rate of youth unemployment and high ratio of women employed part-time is very likely the result of the lack of a national minimum wage.

      • http://www.facebook.com/profile.php?id=193112608 Chris Bertram

        Sorry, simply can’t take you seriously if you can’t get the facts right. Danish employees have legal protection against unfair dismissal and rights to compensation if unfairly dismissed. It isn’t possible to enter into an “at will” employment contract in Denmark. In the US, by contrast, employees can be terminated for no reason whatsoever.

        • http://www.facebook.com/profile.php?id=193112608 Chris Bertram

          See here for example:
          http://www.ilo.org/dyn/eplex/termmain.showCountry?p_lang=en&p_country_id=185

          Prohibited grounds (for dismissal in Denmark) marital status;
          pregnancy; maternity leave; filing a complaint against the employer;
          temporary work injury or illness; race; colour; sex; sexual orientation;
          religion; political opinion; social origin; nationality; age; trade
          union membership and activities; disabilities; parental leave; ethnic
          origin

          • http://volokh.com/ Jonathan H. Adler

            And look at the list for the United States from the same source:
            http://www.ilo.org/dyn/eplex/termmain.showCountry?p_lang=en&p_country_id=164

            Prohibited grounds: pregnancy; maternity leave; filing a complaint against the employer; race; sex; religion; age; trade union membership and activities; disabilities; parental leave; whistle blowing; adoption leave; raising occupational health and security concerns; performing jury service; genetic information

            And it does not account for the existence of more stringent rules in some some states and local jurisdictions, or the fact that even most of those states purporting to be “at-will” jurisdictions recognize numerous exceptions beyond the list above created by federal law. It is simply not the case that throughout the US employees can be fired for any reason whatsoever.

        • Deirdre McCloskey

          Dear Mr. Bertram,
          The pot calling the kettle black? You make much of rates this year. You slide past the dressing up of unemployment in subsidized wages. If I were you I would leave off the indignation button.
          Sincerely,
          Deirdre McCloskey

        • http://whakahekeheke.tumblr.com Cal

          Perhaps you should read more carefully? The point was that Denmark removed “virtually all” of its previously comparatively harsh regulation of dismissal, making it comparable to the characterization of the US regulation as at will. … You’re unambiguously wrong about the US, as you would know had you even bothered to read the source you quoted! Another good overview of US dismissal regulation is here.

      • Deirdre McCloskey

        Dear Cal,
        Thanks for your much better informed perspective than mine!
        I and Milton Friedman and James Tobin and the French state have long advocated a minimum INCOME—not wage. The wage-by-edict is painless to politicians, because they don’t have to pay it out of state funds. But I am a Christian libertarian, and my Savior said, “As you treat the least of my brethren so you treat me.” I am willing to be taxes to give a minimum income to everybody.
        Sincerely,
        Deirdre

    • Deirdre McCloskey

      Dear Mr. Bertram,
      Unemployment over long periods is in fact higher in Denmark and Germany than in the USA (or in the Netherlands, where “uitzendburos,” that is, temp agencies, make it easy to get around the equally crazy employment laws there). But of course the USA is hardly unregulated: terrible drug wars destroying poor neighborhoods, minimum wages.
      Think of the logic. If a minimum wage at current levels is good for the poor, why not $40 an hour? It should make you uneasy.
      Sincerely,
      Deirdre McCloskey

      • http://www.facebook.com/profile.php?id=193112608 Chris Bertram

        Oddly, I didn’t even mention the minimum wage or drug wars. I did, however, notice that employees in Denmark, Germany and other civilized countries have legal protections against being fired for arbitrary reasons unrelated to their work performance (such as their sex, race, bust size, political opinions etc).

        • Deirdre McCloskey

          Dear Mr. Bertram,
          The drug laws are relevant because they destroy inner cities and their families, which makes for unemployment, and unemployability on a shocking scale in the ghettos of the USA.
          Sincerely,
          Deirdre McCloskey

        • http://www.facebook.com/people/Jorge-Emilio-Emrys-Landivar/37403083 Jorge Emilio Emrys Landivar

          You can still fire them for such, it just takes more work and some amount of lying.
          All it ends up doing it reducing hiring of certain groups of people, because they are more likely to win a case against the firm for discrimination.

  • Edward Caskar

    While there is much that is appealing in this narrative, it
    runs into a few problems. The first, as has been noted, is that it conflates
    too many things. Private sector trade unions are surely not the same thing as a
    communist government, Lenin even condemned “trade union consciousness.” The
    other more serious problem is that it is incomplete or even purely
    idiosyncratic to Deirdre McCloskey. Most folks who follow this narrative also
    seem to be apologists for American South during the Civil War, condemners of
    Lincoln, and those who trivialize slavery as a moral problem and cause of the
    Civil War. Following along this, there are also tends to be hostility to civil
    rights and civil rights legislation for minorities and women, certainly the
    1964 Civil Rights Act and Brown vs. the Board of Education are condemned as
    statism or “political correctness.” There tends to be hostility towards giving
    women the vote in the US, and indeed towards democratic procedures in general. Colonialism/imperialism is either denied or
    trivialized or decent people who opposed it like Gandhi are condemned, in this
    case as “opposing innovation.” The other thing I have noticed is that all those
    who disagree with this kind of narrative are labeled socialists or fascists.
    This is ironic given that Ludwig von Mises, who surely embraced this kind of
    narrative, explicitly praised fascism as the savior of Western civilization in
    his book Liberalism. Now most of these failings cannot be attributed to Deirdre
    McCloskey, but the failure to deal with them undermines the purported moral
    force of this narrative.

    • Mark Pennington

      This is an astounding post – Von Mises thought that fascism was a species of socialism, he was not an advocate of it. And I think you’ll find that nearly all of the Libertarian contributors on this site are fierce critics of state imposed attacks on the liberties of gay people and other minority groups. While many libertarians do oppose state enforced measures to stop private people from discriminating against various groups they do so because they wan’t to minimise access to the uniquely dangerous powers that the state possesses. While it is possible for anti-discrimination laws to help free people from forms of private oppression – more often than not, the state is itself the originator of such oppression (look at the history of state enforced, racist zoning codes). If it is a democratic state and a significant enough proportion of the population believes in persecuting various groups, then persecution is what you will get. The lesson of history seems to be that while we may not be able to eradicate discrimination entirely, if we want to minimise the potential scope for its exercise we should limit the ability of the state
      to intervene in people’s private choices. The market was responding to the interests of minorities such as gay people – commercially run bars etc. decades before the state started to repeal various oppressive statutes.

      • Deirdre McCloskey

        Dear Mr. Pennington,
        I am sorry to be so boring in my response, but yes, again, I entirely agree.
        Sincerely,
        Deirdre McCloskey

    • 3cantuna

      Ed,
      The troll light is blinking. Any idea why? Here is the passage from Mises’ 1920s work, Liberalism:

      “It cannot be denied that Fascism and similar movements aiming at the
      establishment of dictatorships are full of the best intentions and that their
      intervention has, for the moment, saved European civilization. The merit that
      Fascism has thereby won for itself will live on eternally in history. But though its
      policy has brought salvation for the moment, it is not of the kind which could
      promise continued success. Fascism was an emergency makeshift. To view it as
      something more would be a fatal error.”

      You realize that Bolshevism and its murderous destruction was a major development across Europe at the time? Anyway, Mises’ despised fascism for its violence. You would know this if your actually read any of Liberalism. Here is another snippet:

      “The great danger threatening domestic policy from the side of Fascism lies in its complete faith in the decisive power of violence. In order to assure success, one must be imbued with the will to victory and always proceed violently. This is its highest principle.”

      In add, here is Mises on colonialism, also from Liberalism:

      “It may be safely taken for granted that up to now the natives have learned only evil ways from the Europeans, and not good ones. This is not the fault of the natives, but rather of their European conquerors, who have taught them nothing but evil. They have brought arms and engines of destruction of all kinds to the colonies; they have sent out their worst and most brutal individuals as officials and officers; at the point of the sword they have set up a colonial rule that in its sanguinary cruelty rivals the despotic system of the Bolsheviks.”

      • Mark Pennington

        I have read Mises Liberalism, and I do not recall that passage – shame on me for that! It hardly follows though that the argument advanced by Deidre should somehow be disqualified or even questioned because of a few dubious passages from one particular author. I can think of no political theory, liberal, socialist, libertarian or progressive, some of whose advocates have not said dubious things at various points and I can think of no political theory whose ranks haven’t contained at least some people of dubious repute (the trade union movement has often between distinctly dubious in its attitude to people from racial minorities). So, what has your comment got to do with the substance of Deidre’s argument? As for the quotation on colonialism I’m not sure why you quote it (old fashioned reference to ‘natives’ aside) – it seems to oppose colonialism – unless you think
        that is a sleight?

        • 3cantuna

          Reply was for Ed, having to do with Ed’s comment.. Unless I misunderstood what he was saying, it sticks.

          • Mark Pennington

            Apologies – got our wires crossed. MP

    • Deirdre McCloskey

      Dear Mr. Caskar,
      That I have “idiosyncratic” positions is not, I hope, an argument against them. I am a Christian libertarian or, as we say here, a bleeding-heart libertarian (I am not implying that only official Christains have bleeding hearts). You are vexed that I do not fall into the simple category you of the High Liberal persuasion have devised, “cold-hearted conservative.” I know it makes you feel virtuous to tsk-tsk over your second capaccino while reading the Times, but consider that other people, even those wretched conservatives, and certainly we bleeding heart types, have ethical views, too, and imagine themselves to be Good, like you.
      Sincerely,
      Deirdre McCloskey

  • Pingback: Around the Web, Kinda « Notes On Liberty

  • http://www.facebook.com/profile.php?id=1091737052 Chad Horne

    “Efficiency is not the chief merit of a market economy: innovation is.”

    That’s an odd sentence to find in an article arguing that the state has no role to play in promoting well-functioning markets, since the main ways our society promotes innovation–patent law, copyright, etc–are all impossible without the state. In the state of nature, when you innovate, I copy. No one would invest significant capital in developing welfare-enhancing innovations if there was no guarantee they would benefit, or if anybody could just take the idea and run with it!

    (Not to say our current regime of patent law is perfect. Far from it. I agree with the libertarian argument that the current regime is too friendly to entrenched interests and has the effect of stifling rather than promoting innovation. But I don’t think anyone seriously suggests the solution is to get rid of patent law altogether, do they?)

    • Nathan Scott

      Unfortunately history is also against you on this one. The classic example of the success of Intellectual Monopoly, the steam engine, is a textbook case in political capture and obstruction.

      James Watt, the son of a wealthy mother, and a politically connected father, made his important insight, to separate the condenser from the boiler, in 1765. He paid no royalties to any previous inventor who had been toiling on the steam engine for hundreds of years. His initial improvement was marginal and the engine still was not readily viable for all but the most specialized uses. He received a patent initially which was quite costly and under dubious circumstances later had it extended to the year 1800.

      Meanwhile, Johnathan Hornblower, began building a similar machine for coal mines throughout England while ignoring the patent, thinking it unenforceable. Rather than produce a better steam engine, Watt and his business associate Matthew Bolton, spent their time suing everyone they could. Trials took several years, and cost a large majority of the potential profits available from building new engines. Litigation was ultimately successful, but not until 1799, and the patent expired a year later.

      Eventually Richard Trevithik made yet another innovation that made all previous versions of the engine virtually worthless. Trevithik, while having a patent for his improvement, never attempted to enforce it against anyone, and even assisted in creating a publication dedicated to discussing newer improved versions of the engine. Between 1810 and 1835 the power, size, and efficiency of the engine all increased by several factors, when before, under Watt’s control, they had remained virtually stagnant. Builders of the engines, rather than sue their competition, invested in mines who were the chief beneficiaries of their inventions. Engineers began charging fees for their time rather than seeking to “own” every permutation of their inventions outright.

      History is littered with examples similar to this one. Patents breed monopolization and oligopolistic control while enriching politically connected allies and law firms and leaving inventors broke.

      • me again

        ditto the Wright Brothers

    • russnelson

      I’m intimately familiar with the effects of patents on software production (e.g. having been the creator of prior art). The solution is to get rid of patent law altogether. It is not possible to fix it, because the concept of patents and software are immiscible. I expect that experts from other fields (were they present) would chime in that patents are bad for their fields also.

      So yeah, I think and suggest that the solution to patent law is to abolish it.

      • Deirdre McCloskey

        Dear Mr. Nelson,
        I myself am willing to sign on to the idea, and forego my (pathetic) royalties from my writings.
        Seriously. I entirely agree. The idea of intellectual property is hideous on its face (or its tongue or its brain), and mostly bad in its effects.
        Sincerely,
        Deirdre McCloskey

    • TracyW


      since the main ways our society promotes innovation–patent law, copyright, etc–

      This is doubtful. How about the promotion of innovation by freedom of speech, widespread literacy, universities, trade secrecy, etc? On what basis do you assert that patent law and copyright are more important than those other ways?

      • Deirdre McCloskey

        Dear TracyW,
        Yes. As Joel Mokyr has persuasively argued, patent loaws were obstructions to innovation in 18th-century England. And consider the Mickey Mouse Law, which the Disney Corp got by going to Congress and buying it (for a surprisingly low price).
        Sincerely,
        Deirdre McCloskey

    • vidyohs

      ” since the main ways our society promotes innovation–patent law, copyright, etc–are all impossible without the state.” That is conflating innovation with the promotion of innovation. Do you seriously believe that innovation will not happen or will be rare without government protection via patent and copyright? As the gentleman said below, history is against your idea.

    • http://www.facebook.com/people/Josh-Strodtbeck/12902155 Josh Strodtbeck

      Copyright and patent are different. Patents tend to stifle rather than promote innovation. Copyright at one time enabled the production of media works that require large investments of capital. However, modern technology has made the legal enforcement of copyright very difficult, so the media industries have turned to technological means like phone-home software and DRM.

    • Graham Peterson

      Mr. Horne,

      Your view, while common, is incorrect. Technology, or the corpus of useful knowledge, is a public good indeed, but not the sort you are concerned won’t be produced without artificial excludability guaranteed by the government. It’s what’s called a network externality public good — language is another example of such a good, for which there is ample supply.

  • http://twitter.com/vpostrel Virginia Postrel

    Much of this debate appears to reflect a confusion of time scales and thus level of detail. Viewed from the perspective of centuries, the contemporary U.S., contemporary Sweden, and the U.S. of the pre-New Deal industrial period look more-or-less the same, as hard as it is for either libertarians or modern liberals to acknowledge it. They are all bourgeois, commercial societies in which having and producing economic value is culturally considered a good thing, with the positive consequences that has for both individual flourishing and economic growth. They all present a sharp contrast to the cultures prior to what Deirdre McCloskey identifies in her important book as the rise of Bourgeois Dignity. John Tomasi’s book can be seen in this context as an argument that liberals of all varieties need to recognize the insight contained in Bourgeois Dignity (the concept as well as the book): that controlling one’s property is important to the creation of a meaningful life. This insight strongly constrains meddling with property rights–not absolutely, but certainly in determining the burden of proof–but it also suggests some sort of Rawlsian minimum and paths toward upward mobility. As McCloskey writes in her recent New Republic essay; “Parallel with the stirrings of democracy and its accompanying welfarism, advocating for hospitals and free public education, was a new bourgeois dignity and liberty.” (http://www.tnr.com/article/politics/magazine/103952/happyism-deirdre-mccloskey-economics-happiness )

    Deirdre’s point above, however, is a simple empirical one: government isn’t magic. She reminds me of a comment Ronald Coase made in an old Reason interview (http://reason.com/archives/1997/01/01/looking-for-results/singlepage ): “My views have always been driven by factual investigations. I’ve never started off–this is perhaps why I’m not a libertarian–with the idea that a human being has certain rights. I ask, “What are the rights which produce certain results?” I’m thinking in terms of production, the lives of people, standard of living, and so on. It has always been a factual business with me. I discovered that municipal operation didn’t work as well as people said it would, and nationalization did not either….I don’t reject any policy without considering what its results are. If someone says there’s going to be regulation, I don’t say that regulation will be bad. Let’s see. What we discover is that most regulation does produce, or has produced in recent times, a worse result. But I wouldn’t like to say that all regulation would have this effect because one can think of circumstances in which it doesn’t.” Philosophers, I realize, generally hate talk like that. It isn’t about end states but, rather, about what happens on the margin.

    Regardless of the time-scale issue, what the Bourgeois Dignity line of analysis does not leave open is the contempt, common on the left and not altogether absent on the right (and even found among libertarians when they don’t like the results of market processes) for commercial culture. Bourgeois Dignity implies looking at commerce not through the lens of manipulation and false consciousness but with an appreciation of individual agency and the legitimate economic value of meanings (and pleasure) as well as function. That takes us far afield from John Tomasi’s book and from philosophy, into economic sociology, anthropology, and media studies. When you start looking around, you find that the people who share this perspective tend to be American libertarians and (for reasons that seem to be rooted in working-class female experience and the austerity of postwar Britain) left-wing British feminists.

    • russnelson

      I’d be happy to admit that the “socialist” Sweden and “free-market” US are run in substantially the same manner. Sweden taxes its residents too highly, and the US regulates its markets too highly. But other than that, things pretty much proceed identically when viewed from the other side of the Dignity gulf.

    • Deirdre McCloskey

      Dear Virginia,
      Exactly. But I always say that about your writing, such as your brilliant new book forthcoming.
      When “we” start implementing “policies” we start crushing that individual agency that lies at the heart of complaints about Stalinist Russia inside the place, or about the feminine mystique inside the gender, or about arrogant bureaucratism worthy of France in the 18th century (and still) inside the business.
      Love,
      Deirdre

    • http://www.facebook.com/hidalgoj Javier Samuel Hidalgo

      This is a wonderful comment. But I think it is a serious mistake to conclude that we can resolve moral disputes simply by looking at the empirical consequences of public policies (unclear whether Postrel actually endorses this). No reasonable moral view would deny that consequences are important. But, on my view anyway, no reasonable moral view would say that only consequences are important and that we should ignore rights, fairness, desert, etc, and this is where philosophy comes into the picture. I doubt that most economists believe otherwise when they just think through their commitments for a moment.

      • Deirdre McCloskey

        Dear Hidalgo,
        Yes. The point of my argument is simply to observe that IF you are a consequentialist you had better get the consequences right, and not assume that because a government “program” is “designed” to help the poor that it actually does.
        If you are not a consewuentialist then the considerations that John Tomasi emphasizes are highly relevant.
        Sincerely,
        Deirdre McCloskey

    • William O. B’Livion

      Lady, You Da Man.

      • Deirdre McCloskey

        Thanks!

  • david3368

    As a side note, on the Internet, when pressed to elaborate on a dubious argument, it is generally considered profoundly rude to say “aha – now watch this hour-long video or borrow this book and all will be made clear!”. It is even worse to add “and if you refuse to consult this ten-thousand-page tome, you are completely unentitled to say that I have not bothered to provide any evidence for my case”.

    And worst of all is, naturally, when the video turns out to be a mail-order DVD and the book turns out to be written by yourself and offered for sale at this low, low price. I trust that the reasons why these might be acceptable norms in state-subsidized and heavily gatekeepered academe but not the Internet are obvious?

    • Deirdre McCloskey

      Dear David3368,
      Thank you for advising me on how to be a superficial scholar. That’s helpful. And I suppose it’s also considered profoundly polite on the internet to hide behind a handle such as David3368 instead of venturing as a grown-up into serious intellectual conversation about serious matters. Still, I wonder how anything can be found out, or how ideas can be tested for veracity or good sense, if we are not to read and not to consider seriously and not to reveal who we are.
      Sincerely,
      Deirdre McCloskey

      • david3368

        Yes, it is in fact considered normal to use pseudonyms on the Internet. As for superficiality – well, it’s your choice whether or not to summarize the relevant part of the book. Rather than argue that any argument in good faith requires buying said book. God forbid that any non-superficial scholarship might be susceptible to tawdry concerns like “conflict of interest”.

        • Deirdre McCloskey

          Dear David3368,
          Instead of revealing your name you continue cloaked! It may be the custom, but I say it’s cowardly. Aren’t you ashamed of being a coward?
          I did summarize the parts of my books. But books are complicated—try reading some and you’ll see what I mean. So I can’t summarize 500 pages of argument in a snappy form that you will grasp instantly yet see everything I wanted to say.
          If you think I recommend people read my books because of the royalties you do not know much about books. A tiny percentage of writers—the Steven Kings among us—make 99% of the royalties. For the rest of us it’s hardly worth cashing the checks, believe me. We write for Truth, not for money.
          Sincerely,
          Deirdre McCloskey

          • david3368

            “If you’ve got nothing to hide, you’ve got nothing to fear”? Really?

            I think your idly brandishing your privileged existence in a society that politely accepts your identity – which you have changed, as a reminder – is incredibly arrogant and there are many good reasons why someone might desire a pseudonym.

            As for conflicts of interest, what sort of academics do you typically work with where “no, no, we work for Truth, not for Money, so please ignore the money” is considered a defense?

          • http://www.facebook.com/people/Jorge-Emilio-Emrys-Landivar/37403083 Jorge Emilio Emrys Landivar

            “If you’ve got nothing to hide, you’ve got nothing to fear”?
            Many people have a lot to hide, and for good reason. Anonymity is one of the last protections that honest people still have.

            Note: I am not anonymous but I respect the right of others to be so!

          • Rahul

            I’ll just say that it is indeed fairly common across blogs to use pseudonyms. I won’t judge the philosophical or moral merits of either option but for many commentators a pseudonym does seem the pragmatic option. Not everyone has an employer who’s cool about their private opinions, and there’s other conflicts of interests etc. Add in the difficulty of making it known that your opinion is not the same as your employer. Living in an academic environ for too long sometimes makes one a bit insensitive to these aspects.

            Overall I find that Pseudonyms in 90% of the cases make for a more frank and open debate though I won’t deny that there is yet a 10% that abuses the privilege.

            My humble suggestion to Ms McCloskey would be to focus on the subject matter of the comments; the ideological fight against pseudonyms is distracting and probably futile. You stand a better chance achieving a regulation-free society even!

          • TGDonlan

            That frank and open debate permitted by pseudonyms very often degenerates into name-calling, which then ruins the frank and open debate. Allowing pseudonyms here will soon be the death of it.

  • http://twitter.com/NevilleMorley Neville Morley

    It’s a truism of historical theory that historians select certain ‘facts’ and ascribe significance to them according to pre-existing frameworks of interpretation (even as, normally to a lesser degree, they modify those interpretative frameworks in the light of external evidence); neither the facts nor the overall narratives are ‘given’. In what sense is this narrative – this apparently random selection of assertions about events from more than a century of global history – ‘better’ than the other narratives than can be told about the same period, other than its coherence with pre-existing ideological commitments?

    The argument that we should not believe in state intervention as the magic bullet that will always, in every circumstance, solve every problem and make everyone’s life better, is entirely banal; has anyone ever believed that? But the rhetorical effect of this litany of examples is to imply that state intervention, of any kind, is always a bad thing – without ever actually committing to that view explicitly. With any other author, this might be dismissed as naivety or poor writing, but Prof McCloskey’s expertise in the field of rhetoric suggests that it is an entirely deliberate tactic.

    • Deirdre McCloskey

      Dear Mr. Morley,
      I thought I replied before lunch, but it apparently didn’t get digested. As an old person I am depressingly incompetent at electronic wonders. The Smart Phone, for example, is too smart for me.
      Briefly:
      You accuse me of dealing in “truisms” and “tactics,” which suggests that you have an attitude toward rhetoric, common since the 17th century, that there’s something nasty about trying to persuade.
      There is nothing “random” about my examples. Each comes from an investigation, usually by other scholars, into the facts of the matter. Gabriel Kolko, a man of the left, showed for example long ago that the Intersate Commerce Commission was captured soon after its formation by the indystry it was meant to regulate, namely, transport.
      The magic-bullet view may be heard nightly on MSNBC (understand: another and equally dubious one may be heard on Fox News). But my purpose was not to show that government is to be abolished. It was to suggest that many of the factual assumptions on which the massive governments of modern times are defended are dubious, and at the least not considered by those with great affection for the State.
      Sincerely,
      Deirdre McCloskey

      • http://twitter.com/NevilleMorley Neville Morley

        Not at all; any and every use of language is rhetorical, even if (as you yourself have shown for economic writing) it adopts an ostensibly unrhetorical rhetorical style, like social-scientific jargon or ‘call a spade a spade’ common sense. What matters is what kinds of rhetoric a piece employs, the particular ways in which its language works to persuade over and above the substantive content of the argument; and that is where, I am afraid, I found your approach rather crude, from the “I’m just a naive historian bringing a little common sense to all you clever philosophers’ opening onwards.

        • http://www.facebook.com/people/Jorge-Emilio-Emrys-Landivar/37403083 Jorge Emilio Emrys Landivar

          So?

        • Deirdre McCloskey

          Dear Mr. Morley,
          I suggest you have your irony detection equipment checked over.
          And the main point of the piece, after all, is the IF one thinks (as High Liberals do) that the consequences show their positions to be correct, maybe they had better, in the light of massive actual scholarship on such matters, think again.
          Sincerely,
          Deirdre McCloskey

          • ThaomasH

            I simply do not recognize the “High Liberal” idea set as presented for criticism. Perhaps it’s because I don’t watch MSNBC, but then, not many people do.

          • Deirdre McCloskey

            Dear ThaomasH,
            You need to read The Nation, or for that matter the New York Times, to get its routine presentation. Such publication s are by no means contemptible. But they do have a history in mind, such as that Unions Caused the 40-Hour Week. The history is often —not always, but often—mistaken.

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    Bravo!

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  • Mike Sproul

    Let me add a sentence to Prof. McCloskey’s superb essay:

    “Central banking has created inflation and recession worse than anything known in episodes of free, unregulated banking.”

    • Deirdre McCloskey

      Dear Mr. Sproul,
      Yup. The worldwide inflation of the 1970s and 1980s was by far the fastest (world-wide, remember: individual countires such as post-WW I Germany did worse) in history, a quadupling in about 15 years. It took a hundred years to quadruple in the so-called “Price Revolution” of the 16th century.
      Sincerely,
      Deirdre McCloskey

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  • T T

    Prof. McCloskey,

    Have always liked your work (esp. your rhetoric on different topics – econometrics, economic thought, law) but this piece seems less-than-convincing.

    I assume that by High Liberals, you are referring to the American High Liberals, for I doubt any political philosopher or scientist worth his or her salt actually claim or believe that government does better than the market. And politicians are not social scientists, though some pretend to be.

    1. For every example you give of government harming the people (of which there are certainly many), there remain rather stellar successes. How would you explain the rise of Taiwan, South Korea, and Singapore in the 1960s-70s? They were authoritarian planned economies, albeit unlike the Soviet/Chinese style economies, but are nonetheless planned. Indeed, Singapore remains a planned free market economy today, economically free but politically unfree.

    2. What about the varieties of capitalism literature in comparative politics? Do you think there is only one form of capitalism and that any government intervention would render that society non-capitalist?

    3. What do you think about Karl Polanyi’s arguments in The Great Transformation? I ask because hardly any academic economist seems aware of Polanyi’s work (“He’s not an economist, and is therefore irrelevant.” is perhaps the most common response I get) and I would expect that any one claiming to be a libertarian would at least be familiar with his arguments.

    4. Back to the bountiful examples you give of government gone wrong. While I do agree with most (but not all) of them, those presuppose the existence of a strong state, that is, a state capable and willing to use coercive power to get what it wants. What if the state is weak? What if government is incompetent, ineffectual, and what you have are groups of merchants (broadly defined) clamoring for power and wealth?

    5. Finally, the age-old question: what is the role of the state then, if any?

    • Deirdre McCloskey

      Dear TT (I wish I knew your name, btw; I wish everyone here would sign their names, forthrightly, and forthwritely),
      Yes, “groups of merchants” are what terrifies the left, and rightly so. Country-club Republicanism says that Our Crowd ought to run things, and not surprisingly when they do the country club prospers, often at the expense of free markets and free minds. But to the left terror of Monopoly I cannot improve on Macaulay’s response in 1830 to Robert Southey, who would suggest
      that “the calamities arising from the collection of wealth in the hands of a
      few capitalists are to be remedied by collecting it in the hands of one great
      capitalist, who has no conceivable motive to use it better than other
      capitalists, the all-devouring state.” We need to keep states small, so that they are not worth corrupting, or so that their corruption is comparatively innocuous. Modern states, whether in Sweden or the USA, are gigantic, monstrous, and well worth spending a few billion to bend to the purposes of the country club.
      I have written a good deal about Polanyi, whom I admire in one way (his argument that the economy is embedded) and do not much admire in another way (his understanding of economic history). He was an admirable pioneer, and apparently a sweetie; like Rawls, he was much beloved. In that dawn of the early 1940s he is not to be blamed for getting economic history so very mixed up (e.g. there were no labor markets, he said, until after 1800). His followers, however, have no excuse, since they have slid by the decades of evidence that his economic history and his anthropology are mistaken.
      I think there is basically one form of capitalism, evident in Sweden and Singapore and Korea and France and the USA: let people start businesses; let them keep their profits; let them go to the work they want at that price. Korea and the rest were nothing like centrally planned—look at Hong Kong, which grew as fast or faster with not a hint of planning. It’s doubtful that the ill-advised subsidies to exports made Korea rich. Innovation and an insane devotion among Korean mothers to education did it.
      Sincerely,
      Deirdre McCloskey

      • david3368

        What’s with your obsessive opposition to pseudonyms? Do you really think that people are not entitled to define that much of their identity? Or should I call you Mister McCloskey?

        • Michael2057

          Despicable. Unlearned. Foolish. False. Irrelevant. What’s with your obsessive opposition to obsessive opposition to “false names?” All pseudonymous comments should be banned, beginning with people who include numerals in their assumed identities.

        • Deirdre McCloskey

          Dear david3368,
          I am inexperienced in the blogosphere, and merely struck by the cowardice and the appalling impoliteness encouraged by anonymity. Your present remark is an excellent example, bringing up my gender change in such a way. You have no honor and no respect for other human beings, and I am not going to respond to you in future.
          I suggest that other people follow the same policy–in a spontaneous order like this the only protection against immoral acts is to cease dealing with the person. We cannot call in the State to punish you, thank God.
          Sincerely,
          Deirdre McCloskey

        • 3cantuna

          Bad show, david3368.

          • david3368

            She rightly expects that other people respect her choice of identity, yet feels entitled to label other people as cowards for choosing their own. It is no incivility to point out just how hypocritical this is.

          • Deirdre McCloskey

            Dear David,
            You are not “choosing” your identity by hiding it, even as late as today. I did not hide my identity. I did my change of gender, alas, in public. Your wild seizing on my change as a way of attacking me is sad. If it is “right” as you say to respect my change, then why use it as a weapon? You need to apologize. But someone as immature as you have shown yourself to be does not know the value of apology. You’d do well to learn it. It heals both sides.

          • John D

            David, gender change is not a path toward anonymity for anyone who lives publicly (like widely-read academics). Choosing an identity and Withholding one aren’t analogous, either. Withholding identification is an abdication of responsibility – totally distinct from choosing a new one in public. One wonders how you could have made such a thoughtless mistake, and one answers: Because you wanted to insult Deirdre in as personal a way as you could. This practice of finding a tender spot before striking is habitually employed by children and adolescents, and often they lose friends afterward. You might have lost friends, too, had you signed the post with your full name. Perhaps you were trying to demonstrate her point.

      • T T

        Dear Prof. McCloskey,

        Thank you for a well-reasoned response, and indeed, the fear the left has of “groups of merchants” is matched only by the terror the right has of “groups of workers” (in which I’d place academics and intellectuals). The increasingly hostile climate the right has steadily cultivated against academics since the eve of 2012 is testament to this.

        I’m not familiar with the Macaulay-Southey response (will have to search for it since it piques my interest) but from the quote, I’d imagine Macaulay, writing in the 1830s, is quite right to be concerned about the power of the predatory or “all-devouring” state. It seems perhaps that at the back of his mind, he was concerned about the extension of the franchise and suffrage, which would empower workers and create incentives to cater to this new constituency. It is also possible, of course, that some capitalists are more privileged than others, and the state, beholden to some interests but not others, will act accordingly. In any case, it is quite a prescient response, in that it describes today’s advanced industrialized states rather well. Thanks for sharing!

        I concur with the need to keep states small and that the influence of the country club – both the left and the right – has reached unprecedented levels. As a scholar of authoritarian regimes, I do think that one major distinction between democratic and authoritarian regimes is the variety of country clubs. In authoritarian regimes, one country club reigns supreme (pardon the Iron Chef pun); such a predatory state has a single motive – serve the capitalists (or religious elites, or military elites), for cash permits both coercion and coopation, and regime survival. The key attraction of democratic regimes, in a practical sense, is the inclusion of other country clubs into the mix _and_ the introduction of a mechanism that allows a rotation of power among different country club representatives (“We, the people” is an ideal). I’m not sure if this always leads to an enlargement of the state, but the nature of the democratic process is such that it will occur, simply to accommodate the increased number of interests.

        All this is to say that a small state runs the risk of becoming an authoritarian state. Authoritarian in the sense that it must necessarily respond to some interests but not others, which imply that some groups will be privileged over others. One, of course, can argue such a state is preferable to one with overarching power that seeks to dominate all aspects of life.

        I’m also glad to know we share the same sentiments about Polanyi; I was and remain quite taken with his notion about the economy being embedded and his development of the state-market-society relationship; I see his argument as a worthy counter to Hayek, which is why I tend to get shocked when libertarians claim not to have heard of him. I wish I knew scholars who built on his work but alas, I don’t, and from what you’ve written, it seems that they have not done him justice. I think if you agree that the economy is embedded, and that the market cannot survive without the state, then the state does play a role; at the very least, it ought to be a mediator of interests, ideally beholden to none.

        On there being essentially one form of capitalism: I do agree with your description though it is a very minimal one. As for S. Korea and the other “Tigers”, I beg to differ. While the “insane devotion” or what some in my field call “cultural factors” certainly played a role, governments in those countries did make enormous investments in education and infrastructure (why these authoritarians regime did so but not others is the subject of my research). There was also selective encouragement of industries – Taiwan did not become the world’s largest motherboard and video card manufacturer out of chance; neither did Singapore become a bio-tech and financial hub for the Asia-Pacific.

        Ultimately, I suppose there is no “optimal” size of government, and arguments that purport to do this, either through the mathematics of economic theory or the rhetoric of philosophy, miss the critical role of context.

        Sincerely,
        Terence Teo

        • david3368

          No need to engage in speculatory counterfactual there. The Park government of South Korea grew much faster than the postwar Rhee government due to actual policy differences, even though it was not plausibly more liberal in any classical sense. It was merely more centrally cronyist, and growth gave Park ways to control his cronies and minimize subordinate corruption in a way that Rhee could not.

          Hong Kong always had vigorous housing and education intervention; those slums did not disappear by chance. Singapore had all that and even more, of course.

          • Mark Pennington

            No one has ever claimed that Hong Kong is a pure laissez faire system – pointing to two areas where it has been relatively more interventionist isn’t sufficient to counter the large swathes of economic activity where it has been relatively one of the least interventionist regimes – little or no public ownership of industry, no regs on prices or wages, very low tax to GDP ratios and almost complete free trade. In the post war period Hong Kong consistently outperformed the other east Asian countries. Look at Deepak Lal’s discussion of the South Korea – if import substitution style interventions were the cause of growth – as opposed to being either irrelevant or perhaps harmful – then why did growth improve following the abandonment of these policies and the move towards a more neutral trade regime? Finally, Ben Powell has an excellent article in the Review of Austrian Economics – it compares all of the East Asian countries on a basket of ‘economic freedom’ indices and finds that while none have been ‘pure’ market economies – Hong Kong and Singapore have consistently ranked in the most liberal category and East Asia as a whole has been more economically liberal than the rest of the developing world.

        • Deirdre McCloskey

          Dear Professor Teo,
          We have substantial agreements, and some disagreements, but not so far that we can’t mutually educate each other. I like your point about competing country clubs—we’re seeing in today’s headlines from Egypt, for example, in which the military countru club is determined that there be no others.
          The “selective encouragement of industries” always worries me. Maybe the selection is good. But how many cases are there in which it was a disaster (thus Indian focusing on the old indusries like steel and not noticing its comparatove advantage in computer services).
          I do build on Polanyi. The economy is, I say, embedded. It’s just that his economic history, in which he put such great store, is mistaken, and his leftist conclusions are mistaken, too.
          Sincerely,
          Deirdre McCloskey

      • http://www.facebook.com/people/Jorge-Emilio-Emrys-Landivar/37403083 Jorge Emilio Emrys Landivar

        Dear Prof. McCloskey, not everyone can sign their names, due to harassment and possible harm in meatspace for internet-space actions.
        I know individuals who have lost their jobs over these sort of discussions.

        -J. Emrys Landivar

        • Deirdre McCloskey

          Dear Mr. Landivar,
          It that case I withdraw my criticism. But I wonder if it generally true, and wonder if anonymity is not mainly a cloak for intemperate yelling.
          Sincerely,
          Deirdre McCloskey

  • http://www.facebook.com/les.nearhood Les Kyle Nearhood

    Dr. McCloskey, Thank you for this marvelous encapsulated argument. I think some people may be arguing with you on the basis of reading your statements as absolutes. If one does that then one would get the impression that all government is always bad and no law involving economics can ever be helpful. But that (as I read it ) is not your argument.

    Your argument as I understand it is that one ought to consider carefully the real world results of government economic policies because they have been historically more harmful than good. . Or in other words, let us apply the Hippocratic principle to all government solutions. First do no harm!

    • Deirdre McCloskey

      Dear Mr. Nearhood,
      At last, someone with the courage of his convictions, who signs his name!
      Yes: consider carefully. Listen to history. Stop talking about laws “designed” to have this or that effect and then walking off, satisfied that one’s journalistic or citizenly duty is finished.
      I reckon that if we did it, government bureaus would be a smaller part of our lives, and grace and exhange and creativity a larger part.
      Sincerely,
      Deirdre McCloskey

      • muliolis

        Problem is, most of them have a very distorted view of history. Not even reading Herbert Hoover’s own memoirs of his interventions into the economy will persuade them that they are mistaken that laissez-faire caused the Great Depression.

        • Deirdre McCloskey

          That was my point, to get the High Liberals to stop and read and think.

  • Adam

    “Externalities do not imply that a government can do better.”
    Than what?

    • Deirdre McCloskey

      Than an unregulated market

      • Adam

        Is that a fact-based statement? Or is it an example of abductive reasoning? There being no unregulated market societies for you to compare to, only “less or more” regulated, and / or “better or worse” regulated.

        • Major_Freedom

          “Is that a fact-based statement? Or is it an example of abductive reasoning?”

          It can be both.

          • Adam

            It can be, but that kind of defeasible, non-demonstrative reasoning is not in accord with claims that people in disagreement with the author are “mistaken factually”, which seems to be the main thrust of this piece.

      • http://twitter.com/JimNichols JimNichols

        An “unregulated market”, to paraphrase Ha-Joon Chang, is just one where all parties involved accept the government intervention as given. Free markets don’t exist.

  • Rahul

    I will admit I haven’t read Ms McCloskey’s books and I do know she’s a very accomplished researcher. Yet I am tempted to be brave and ask:

    Do you really think the world would be a better place without *any* building codes and worker-protection laws? What’s your opinion on the exploitative world painted by Dickens, Upton Sinclair etc. Would things have improved without regulatory intervention?

    There’s definitely regulatory overkill in many cases, but some of your criticisms seem to indicate *all* regulation as bad. Just curious if this is indeed what you mean or am I misreading you.

    • Deirdre McCloskey

      Dear Rahul,
      You should take your economic history from economic historians, not from novelists—which is not to say that nothing can be learned from novels, merely that they by themselves are poor guides to how things actually were. Charles Dickens, on whom I have written a bit, hardly ever ventured north of London, and understood industrialization exceptionally poorly. Upton Sinclair, besides being a not very good novelist (try it and I think you’ll agree), was part of a generation of Progressives who ventured into capitalism pre-persuaded of its evil.
      I ask you: what do you think prevent MacDonald’s from poisoning you? The government?
      Sincerely,
      Deirdre McCoskey

      • Adam

        So is all regulation bad, or is he misreading you?

        • Deirdre McCloskey

          Dear Adam,
          No. Only most of it. Regulations against force and fraud are a good idea. And certain rare cases of genuinely public goods. Very rare. Regulation is usually pointless, giving jobs to bureaucrats. Get to know the details of meat “inspection” for example and you will be amazed that we are not all dead—if the inspection was the only thing between us and bad meat.
          Sincerely,
          Deirdre McCloskey

          • muliolis

            I like your blog post a lot.

            Where can I find out more about meat inspections?

          • Deirdre McCloskey

            Dear Muliolis,
            Go to agricultural economists and ask. They have some hair-raising stoires to tell!
            Sincerely,
            Deirdre McCloskey

          • B

            Care to be any more specific?

          • Deirdre McCloskey

            I’m sorry, but I can’t do the research for you. I assure you that any agricultural economist could put you onto the studies of the astonishingly shallow “inspection” of meat, for example.

          • Rahul

            What other regulations do you think are good?

            Which of the following would you say can be done away with: building codes, fire codes, traffic laws, FAA, EPA, FDA, OSHA, medical licensing, driving licensing?

            I’m trying to imagine how a world without any such regulations would look like. Outside of fiction, has such an experiment ever been tried and has it succeeded? What makes you so sure it would succeed?

          • Deirdre McCloskey

            Dear Rahul,
            All of these could be closed tomorrow with little effect. When people pollute, and violate criminal laws again pollution (I don’t say there should not be such laws), the matter should be handled by the police and the courts. Medical licensing is a catastrophe—we would have much cheaper and better medicine in the US if foreign doctors could practice here. I once knew a brain surgeon with 500 operations to his credit who was blocked from practicing here.
            And at the least such regulations should justify themselves. If justified on grounds of Safety First they should at least have to show that they work: the FDA does not, for example.
            And at the very least the High Liberals should do their scientific homework, instead of rejecting any criticism of government as “conservative,” and getting indignant and angry, as many hav on this site. It is a sign of the dominance of High Liberalism in intellectual circles that no one at The Nation thinks it’s worthwhile to stop and think. (The Natonal Review is no better.)
            Sincerely,
            Deirdre McCloskey
            Sincerely,
            Deirrre McCloskey

          • ThaomasH

            But is The Nation the epicenter of opposition to allowing more highly skilled immingrants? the war on Drugs? application of cost benefit analysis to regulation?

          • Deirdre McCloskey

            Reasonable point. The Nation is a sophisticated version of High Liberalism, I concede. But I can’t quite credit your claim that there’s no such thing. If there isn’t, why does, say, Reason magazine find so much material, carefully cited?

          • http://twitter.com/Sammykaine Samuel Kaine Wheeler

            Regulations against force merely mean the state has a monopoly on force. You dislike monopolies surely? And force has an important social effect. If I am starving and you have a full purse you’re more likely to help me voluntarily if you know that your refusal could merit me taking it, which I have every right to do since my right to life trumps your right to property.

          • Deirdre McCloskey

            Dear Mr. Wheeler,
            I don’t see the force of your remark. I see no alternative to having some entity, called the state, with a monopoly on the legitimate use of violence. The extortion you seem to be advocating in the last sentence is a use of private violence which I do not approve of, and either would you if it were widely exercised—that is, if a reputable state did not have a monopoly of violence.
            Sincerely,
            Deirdre McCloskey

          • http://twitter.com/Sammykaine Samuel Kaine Wheeler

            How is it any more extortion than a food producer demanding I give him my labour in return for the bread I need to live? Or the owner of land demanding I pay her rent merely for standing upon the soil she did nothing to create? Both wealth and strength are simply different forms of power, whose relative importance depends upon the society in which one finds themself. If I am poor and strong, and you rich and weak, why is it ok for you to exploit my biological imperitives for food and shelter to make me do what you want, but not alright for me to exploit your biological desire not to have pain inflicted upon you to make you do what I want?

            The ‘libertarian’ view of the state is simply that the power of government should be used to preserve their ill-gotten gains while restricting the one power the poor might have, their numbers and muscle, to redress the balance.

          • Deirdre McCloskey

            Dear Mr. Wheeler,
            Your view has an honorable lineage back to Rousseau. What I think you’re missing is that property is necessary for human progress. The notion that Property is the Problem rings through social thought in the West, and has had disastrous results. Our skills and land and whatever are badly used if not private. I went to Cuba in 2001. The houses of the former rich had been taken over by whomever wanted to squat in them, so multiple families lived in them. The result was that the houses were collapsing, so one taking the responsibility to fix the roof, say. While incomes per head in the Caribbean and Latin America all around it doubled in real terms 1959 to the present, Cuban income has stagnated.
            Sincerely,
            Deirdre McCloskey

          • http://twitter.com/Sammykaine Samuel Kaine Wheeler

            But surely that makes two critical assumptions. The first, that an increase in income per head means more people are better off, rather than a small number of people becoming far more wealthy. Second, that notions of social status (for we are social animals) are secondary to economic absolutes. Once we’ve met our immediate biological needs, much of the rest of our expenditure is about status; flashy cars, trendy clothes, various trinkets. This is not a moral judgement upon them, I like trinkets too, and indeed from the business suit to make-up many are in fact essential to be a part of Western societies. But if I live in a society where conspicuous consumption is unnecessary, indeed counter-productive, than am I necessarily any worse off for not being able to afford things I don’t need and subsequently no longer want?

          • Deirdre McCloskey

            Dear Mr. Wheeler,
            I think I answered this already (such is my confusion), but briefly: the poor were the main beneficiaries of growth (question: how much do you think your g-g-g-grandfathers made per day; and conspicuous consumption is not what drives us (question: does it drive you?)
            For the full argument you’ll have to read those wonderful books by D . N. McCloskey.
            Sincerely,
            Deirdre McCloskey

          • http://twitter.com/_Srijit Srijit Sanyal

            Just a couple more points to Deirdre’s. You are ignoring all the symmetry here. Trade is mutual “exploitation” – the consumers of what you produce (for the employer is merely a vehicle) “exploit” your need to eat to get their shoes, just as you “exploit” their need for shoes to get your food. And it would make no sense to have all producers catering to the very bottom of Maslow’s Pyramid.

            Of course, the term “exploitation” gets its force from the insinuation that the exploiter harms the exploitee – acts directly to make them worse off. And so we come to the main point: it is not “extortion” for a food producer to demand labour for bread (leave aside that you could enter a subsistence economy and feed yourself, instead of a cooperative exchange economy where everyone is paid their marginal contribution to the catallaxy), as it is not his fault that you need bread to live. He never took anything from you, yet you would take from him – a perfectly normal blameless individual like the rest of us. I wonder, would you be comfortable with the full implication of your dogma, than anyone who was starving, if endowed with sufficient force, could take from you and your family no matter how you left them alone?

            As to your last point, how are “their” gains any more “ill-gotten” than anyone else’s? Indeed, how are they ill-gotten at all? On a not wholly unrelated note, do you ever feel that your two working eyes are ill-gotten, when some are born with none? You only really need one. (I won’t even mention your kidneys.) Apparently $25 can restore sight – how many times have you done that, instead of paying for lavish meals or to see movies that would never have existed without capitalism?

          • B

            Care to give a link?

          • Deirdre McCloskey

            I don’t know what you mean: I apologize for my technological idiocy!

          • Graham Peterson

            “Link” is short for “hyper-link,” which are the underlined text that point to another location in a document, another file on a computer, or another file on a network (the internet, say). So to ask for a link is to ask for a citation, or a breadcrumb to follow.

          • Graham Peterson

            “Link” is short for “hyper-link,” which are the underlined text that point to another location in a document, another file on a computer, or another file on a network (the internet, say). So to ask for a link is to ask for a cite, or a breadcrumb to follow.

      • Rahul

        Apologies about learning from novels than historians; if only the later were as interesting to read. I hate to speculate but I doubt a
        McCoskey work is as much fun as Dickens! After all, not all of us do this as a career……..

        I have to disagree about Sinclair; my literary tastes are nowhere as refined as yours probably; yet I must say I enjoyed both Jungle and King Coal.

        I’d never say it is *only* the government that saves me from McDonald’s; but it plays its (small) role in the grand scheme of things.

        I think there’s a (fairly low) optimal level of regulation in society. I agree we are mostly over-regulated. Your point that’s hard to digest is that you (seem to) insist that this optimum is close to zero.

        • Deirdre McCloskey

          Dear Mr. Rahul,
          No, I do not prejudge the question of where to set the regulation meter. I am a follower in this of Ronald Coase. I just want people to realize—as you do—that setting it at 85% (whatever that might mean!) is not always a good idea.
          It’s a lot easier to reject a libertarian who says that the meter always be set at 0%. But nothing is gained in treating the empirical quewstion if we leave our rejection of libertarianism (or for that matter Swedish welfgare statism) at the choice between 0% and 100%, right?
          Sincerely,
          Deirdre McCloskey

  • Pingback: johaneriksson.se » Blog Archive » Recommended Reading: McCloskey On Government And Markets

  • Hm

    Eradication of smallpox, hundreds of millions lifes saved.

  • Mike Sproul

    Let me add one sentence to Prof. McCloskey’s superb essay:
    “Central banks have created worse inflations and recessions than anything known under free banking.”

  • Mike Sax

    Hello Prof. McCloskey! Pleasure reading you. Now when you say:
    “How do I know that my narrative is better than yours? The experiments of the 20th century told me so. It would have been hard to know the wisdom of Friedrich Hayek or Milton Friedman or Matt Ridley or Deirdre McCloskey in August of 1914, before the experiments in large government were well begun. But anyone who after the 20th century still thinks that thoroughgoing socialism, nationalism, imperialism, mobilization, central planning, regulation, zoning, price controls, tax policy, labor unions, business cartels, government spending, intrusive policing, adventurism in foreign policy, faith in entangling religion and politics, or most of the other thoroughgoing 19th-century proposals for governmental action are still neat, harmless ideas for improving our lives is not paying attention.”
    You say a lot. So I will respond to at least some of those things. I admire your healthy egoism-I say that sincerely. I love the way you’re able to speak of “Friedman, Hayek, and Deidre McCloskey..” I’m no fan of false modesty. It’s interesting though that Friedman are so easily lumped together-it would seem they disagree on some very consequential points. In any case that’s how most Austrians make it sound.
    As for the idea that all these things you list have been disproved by the existence of these listed authors, I guess what you’re saying is the argument is so well known and universally accepted as not to require going through one more time. And that huge list of yours covers so many things I doubt there’s anyone who simultenously rejects all of them. Certainly we know imperialism wasn’t rejected-as we got the Neocons and Bush.
    I’m not for a lot of those things but think that labor unions or government spending fit s very well with colonialism and the Nazis or indeed the Soviet Union. The USSR actually came down harder on the unions than even Scott Walker could dream of.
    “Minimum wages protected union jobs but made the poor unemployable”
    Really? Why did we have about 3 decades of near full employment after the MW then? I don’t see how you can deny that the 40 hour work week cut down hours-prior to that and other labor legislation we had long hours and things like child labor.
    Some of what you say about proponents of regulation quite misconstrues the premise. “Publicity does better than inspectors in restraining the alleged desire of businesspeople to poison their customers.”
    It’s not that “businesspeople” want to poison their customers but that sometimes in certain industries making sure they are not poisoned is not “efficent” enough for them-that is too much money.
    It also doesn’t mean that you are assuming customers are brain dead in calling for reasonable consumer protections.

    • Paul Feldman

      Perhaps “unemployable” is not the right word but the minimum wage was intended to, and for quite a while succeeded in, preventing the movement of industry from the unionized north to the non-unionized south. In a campaign speech for the Senate from New York, Robert Kennedy urged voters to elect him because he would fight for raising the minimum wage to prevent New York factories from moving away to the south. Now, unions demand that foreign countries impose minimum wages, clearly to prevent foreigners from competing with higher wage (unionized) American workers.
      The result of the minimum wage was not to produce three decades of growth, it was to prevent the development of higher wages in the US south.

      • Deirdre McCloskey

        Good point. One should always ask, “Cui bono,” to whose good?

    • Deirdre McCloskey

      One has to go back to the scientific studies on which my listing was based. The 40-hour week, for example, was not an accomplishment of unions. 40 hours became the standard for all industries, unionized or not, when people got rich enough to want lower hours. (And including my name with Friedman and the rest was a self-deprecating joke, not vanity: I am not worthy to eat the crumbs from the table of such people.)

      • Don Boudreaux

        Well, Deirdre, here you are wrong (about eating the crumbs, that is).

        • Deirdre McCloskey

          Dear Don,
          You are too generous!
          Love,
          Deirdre

  • Pingback: On the « The Myth of Sisyphus

  • Mike Sax

    “Federal deposit insurance made banks careless with depositors’ money”
    It also ended bank panics as a regular feature in American life.

    • Major_Freedom

      100% reserve banking would have done the same thing, at lower cost.

      Deposit insurance is only perceived as necessary/beneficial with fractional reserve banking.

      • Mike Sax

        Great Major now you’ve followed me here. Is there any empirical evidence of this? And why even if it were so would it necessarily be lower costs?
        There’s a sense where I think this demand for 100% reserve banking is like the ‘no true Scottsman Fallacy”

    • http://www.facebook.com/people/Jorge-Emilio-Emrys-Landivar/37403083 Jorge Emilio Emrys Landivar

      “It also ended bank panics as a regular feature in American life.”
      Considering we just had bank panics all over the united states… I disagree.

      • Mike Sax

        Ok I should say bank runs so you can’t misconstrue it.

        • http://www.facebook.com/people/Jorge-Emilio-Emrys-Landivar/37403083 Jorge Emilio Emrys Landivar

          Um, there have been bank runs too. Many, many smaller banks went under in 2008 as a result of people withdrawing their funds.

          • Mike Sax

            No matter how you try to quibble we don’t have the threat we had prior to FDIC. If isolated small banks had runs we don’t see anything like the panic of 1837 or 1908

  • Mike Sax

    “Europe recovered after its two 20th-century civil wars mainly through its own efforts of labor and investment, not mainly through government-to-government charity such as Herbert Hoover’s Commission or George Marshall’s Plan”
    Actually in the case of the Marshall plan this is mistaken. Without it Europe would have been in the wilderness for decades.

    • Major_Freedom

      What is the basis of this counter-factual claim?

    • TGDonlan

      Germany received $1.4 billion of Marshall Plan aid; the U.K. received $3.2 billion. Germany deregulated its economy, significantly but not completely, while the U.K. nationalized numerous industries and imposed heavy taxation. In 1950, German per capita GDP was 75% of the U.K.’s; German had caught up by 1960. I doubt the Marshall plan was the most important element in either nation’s postwar economics, but it’s clear that tightening state control was less successful than loosening it.

    • Deirdre McCloskey

      Actually, I think not, though I know it is widely believed. Look at the magnitudes. The entire Plan amounted to less than one year of European investment. And look at the history.

  • http://www.reddit.com/r/CafeHayek/ Invisible Backhand

    I think D. McCloskey should not be lecturing anyone else about how confused they are.

    • Deirdre McCloskey

      What is that supposed to mean? More trans-bating?

      • http://www.reddit.com/r/CafeHayek/ Invisible Backhand

        Is that like red-bAIting? Because that’s what you’re doing.

        This sentence:

        “Publicity does better than inspectors in restraining the alleged desire of businesspeople to poison their customers.” is ludicrously simple-minded and ahistorical. You’re a foxnews freakshow.

        http://www.reddit.com/r/CafeHayek/comments/vci3o/d_mccloskey_doesnt_understand_that_when_you_use/

        • Graham Peterson

          And you’re immature, but let’s stick to the argument: McDonald’s for instance, responded to widespread, privately-sponsored advocacy for transparency about how bad its food is. Informational asymmetry solved, no government intervention.

          On the other hand, Michelle Obama uses tax money to travel to Indian Reservations and persuade children to not become fat alcoholics. It warms my heart, but it’s the government.

          Or is it? The peaceful, civil persuading of children and other vulnerable groups constitutes very, very little of the government’s daily to-do list. It is however, almost chiefly what decent human beings do with one another every day — with or without Uncle Sam in the room.

        • Deirdre McCloskey

          You apparently feel it is just fine to attack people for changing gender, right? Is that a High Liberal principle?
          And you do not have much of a grasp of how business works. Food inspections are a minor part of protection of the food supply—by far the largest, especially for the big chains, is reputation.

      • http://www.reddit.com/r/CafeHayek/ Invisible Backhand

        You deleted my reply. Good thing I take screenshots:
        http://i.imgur.com/dJK3L.png

        • Rusty Shackelford

          No you twit. All the comments remain,

  • false seriousness

    Libertarians make me want to vomit.

    It is a juvenile, dishonest intellectual philosophy, much admired by poseurs. It’s easy to sloppily list a bunch of things you don’t like that are an expression of a universal part of human experience, and then claim that, somehow, things would be different if only poor misunderstood libertarians held sway.

    Yet, libertarians are incapable of answering *why* things have evolved as they have. Upon which modern state do juvenile intellectual poseurs like Dierdre McCloskey want to model America? They can’t solve problems, so they just sling crap against a wall (which is why this post is a stew of cliche and absurdity), and think, wow that all sounds bad. But is cherry-picking really a sustainable intellectual theory?

    I can’t imagine how people can read this post by McCloskey and be remotely persuaded of anything. For me, the more I read from libertarians, the more pathetic they sound.

    The last two substantive paragraphs are particularly rich with foolishness.

    For example: “Arab men have been kept poor, not bettered, by using state power to deny education and driver’s licenses to Arab women.” There are so many objections to this stupidity, it’s hard to know where to start. But someone has to:

    1) It’s a Godwin level argument, and is part of a cynical pattern of listing “bad” things, and attributing them to anything that doesn’t fit what Deirdre McCloskey wants to be described as libertarian. Only good things can fall into the description – which is why I call this a juvenile philosophy. As a corollary, she dumps whatever she doesn’t like into the liberal bucket. It’s a strategery that would make Sean Hannity proud.

    2) Women everywhere for much of human history have encountered discrimination. What does “libertarianism” have to do evolution of their liberty? Why, pretty much nothing. Is the modern liberal society, expressed through governmental action and evolution of law, responsible for the advancement of rights? Why yes, it is. In fact, “liberals” can more fairly claim credit for the liberalizing of rights – certainly as has developed in the “first world”. But consider that a cornerstone of our own jurisprudence was “the husband and wife are as one and that one is the husband.” A better post would address why and how this theory changed. But such a post would not appeal to the narcotic of condescension, nor would it be helpful to McCloskey’s theories. But heck, what’s a little intellectual integrity between friends!

    3) How do clumps of people chose how they will live? They make governments, which is only an expression of how people are choosing to be governed – either actively (like democracies) or passively (like NK). What should governments do? What should they not do? Again, the accusation this is a juvenile philosophy is correct because fundamentally the complaint is, “if people weren’t like people, then we wouldn’t have problems!” People are imperfect creatures, and their imperfections will manifest. Libertarians think they have an answer to this? By disempowering people from selecting their own governmental arrangements? Ironic.

    And once you accept government, what do they do? Is McCloskey suggesting that governments can’t regulate driving? What government wouldn’t have the power to do that? True libertarians let drunks and 6 year olds drive! But of course the down side in governmental regulation is that bad choices will be made – like discrimination against women. But there is nothing about libertarianism that would have led to a different result – unless you apply a juvenile standard (bad human action goes into one bucket; only good human actions go into the libertarian bucket).

    Beyond this foolish example, libertarianism is really just a cynical method of opposing modernity, and promoting feudalism in the form of deference to corporate governance. Once the power of the state is gutted, what check is there on the corporate citizen? So the problems inherent in the human condition become worsened, not lessened when checks are gutted in favor of corporate power. If libertarians supported unions, which should have a strong role in a libertarian theory that had integrity, I would take them more seriously. But they don’t, so I don’t take them seriously.

    I suppose the tone of this response will be considered objectionable. But then I read stuff like…

    “Precisely.
    And note that if you scratch a sweet High Liberal you find
    an authoritarian Rousseauian underneath—that is to say, someone with
    great affection for “programs” that “we” do. I do not need to mention
    Stalinist collective farms or Maoist cultural revolutions to make the
    point, so I won’t.”

    Remember the juvenile term I used earlier? Wonderful manifestation here. If you like Social Security and have affection for that program, why that’s just like a Stalinist collective or a Maoist cultural revolution.

    • Deirdre McCloskey

      Such abusive talk doesn’t warrant a reply. You should consider why you get so angry. I suggest that it is because you speak from a position of dominance, the High-Liberal dominance of US intellectual life. You are simply outraged by disagreement.

      • false_seriousness

        Have you assessed your own tone and sneering? Why are you using weird labels that are obviously intended to be derisive and dismissive (“sweet High Liberal”)? Mission accomplished! You are offensive, and I even provided an example of your bile in my response.

        I believe you are an intellectual poseur because your whole schtick is to cherry pick unintended consequences and regulatory capture, while ignoring progress and improvement, as if unintended consequences and regulatory capture are not manifestations of universal human imperfections. Nothing about your philosophy addresses either in any respect. I believe the human condition would be far worse, because you are like a doctor who treats a patient with warts by shooting him between the eyes. I guess you fixed the warts, but you have a dead patient on the table with a hole in his head.

        In fact, all your “philosophy” is an expression of Deirdre McCloskey’s preferences. Big deal. You simply have your own continuum of acceptable governmental actions and anyone who deviates from your preferences is labeled, insulted and marginalized.

        • Contemplationist

          Mr. False.

          Your response is exactly why I loved McCloskey’s bang-up post. You have nothing but contempt and bile for those who oppose with facts your New Deal Consensus garbage which has been refuted most thoroughly.
          Let’s see you object to at least one factual assertion in McCloskey’s piece, and lets see if you have any substance behind your opinions.
          It’s like Santa Claus has been taken away, hasn’t it? WAAAAH!

          • false_seriousness

            I think you should actually read my post before pretending like you have something to contribute. You see, I actually read what McCloskey wrote.

            Had you read my post you would have noticed that I selected McCloskey’s assertion that, “Arab men have been kept poor, not bettered, by using state power to deny education and driver’s licenses to Arab women.”

            In reality, it’s like shooting fish in a barrel, because her “theory” is nothing more than an expression of her preferences. And what she doesn’t like, she labels in some odd way. There is no there there.

          • Deirdre McCloskey

            Let’s get one thing straight: of course I “cherry picked” historical findings. That is the point—that there are many examples of beliefs by High Liberals (their own and Tomasi’s label, not my invention) about the goodness of government that ain’t so. What the balance is of good and bad is a separate issue. But surely you agree that we need to strike a balance on the basis of facts, not fairy tales.

          • false_seriousness

            You do more than just cherry picking. Frankly, I’m astounded that you have had a distinguished academic career, because I’m certainly not impressed.

            One core issue is that you selectively conflate human failings with failings of specific “High Liberal” institutions (whatever the hell that actually means) that you happen to disagree with. So while discrimination is a base human failing associated with our primal need for tribal connections (whether race, nationality, gender or even sports team), you accuse unions of being responsible for racism, and ergo, unions are evil. But, unions were merely reflections of people and society at that time. Apply your balance standard to them too.

            And you go further, because you ignore the positive things that are associated with those institutions and you assert – wholly lacking in evidence (however much you say that you have evidence) – that changes would have happened anyway. It’s always the magical “the bad things would have gone away anyway” argument with libertarians. Liberals changed societal rules on justice, not libertarians.

            Here’s an example of the quality of your thought:
            1) Slavery was bad
            2) Governments approved the use of slavery, ergo
            3) Governments are bad

            You make variations of this argument constantly. The problem is, it’s faulty logic. Governments will always exist, in some form or another. There is no vacuum in human governance. There is no idealistic period or place where people operate without governance. You can’t say, government is the problem, so we’ll eliminate it. You may eliminate a structure, but something else, doing the same sort of thing, will fill the void. Vacuums only exist in space; not in the sphere of human interactions. The downside of course is that governments are manifestations of human failings because we are imperfect creatures. We are capable of great good, but certainly wickedness and evil as well. What we can do is strive to improve, and to apply the Golden Rule to one another. Social Security is not tyranny, and it’s not a vehicle to a Stalinist collective or mass murder and it has made millions of lives vastly better for decades.

            You repeatedly concede, as you must, that there must be government, and that government must regulate certain things, but then you just fling random thoughts around — coalescing on the wholly unoriginal thesis that there must be a balance. Gee, people get tenure for that?

            As I said in my first post, boiled down your philosophy is simply your own set preferences on a continuum. It has no more value anyone else’s set of preferences, but you pretend otherwise.

            And what kind of serious intellectual says stuff like, “They (those High Liberals again) believe that everything unions did (oppose immigration; exclude blacks and women) was good.”??? Nobody thinks this, not even unions. It’s an ugly tactic, and has no proper intellectual role.

            Frankly, the more you post, the worse you sound.

          • Deirdre McCloskey

            What to say to your rage?
            Let’s take one point. I don’t think unions are evil. I wish Scott Walker had been recalled. I belong to a faculty union now, and as a kid briefly to the National Maritime Union. Would I join an evil entity? No way. My grandfather, uncle, and cousin were union electricians in Michigan. I like to joke that I’m the only person in most groups who could become an apprentice electrician in Michigan, because only union relatives could do so.
            And that’s part of the bad news (along with the good: worker dignity, say). Anyone will know the bad news who knows the history of American unionism (I was in the 1960s a student of John Dunlop, the leading scholar on the matter, later Secretary of Labor, and for many years the chief negotiator for the US building trades). She will know that unions have in fact closed apprenticeships against Blacks, women, and non-relatives. After all, if a union is to be effecctive in raising wages it has to cut the supply. And unions have of course been against free immigration, for the same reason. Right now many unions are. And it is notorious, well known by any historian, that unions were racist.
            Or, sometimes, anti-racist: as you observe, out of the crooked timber of humanity no straight things was ever made. You are correct, to use another image, that we are fallen creatures, and so unions, and governments, and armies, and markets, are going to be imperfect.
            The only point I was making in my piece was that the Wonderful Fairy Tales out of the left (I could name a matched set out of the right, and have elsewhere), which you can hear nightly on the Ed Show or Rachel Maddow (both of which I admire and watch more or less nightly), are historically erroneous, according to a mass of serious scholarship since the 1970s.
            There’s no need for you to get angry. It doesn’t do the left’s case any good to shout it.

          • false_seriousness

            I’m sure no one is reading this anymore, but I’m not the “left”, I’m not a Borg, and I’m not a spokesman or a PR person for the “left.” I know you love labeling people, but I’m just a guy expressing my frustration at what I perceive to be sloppy arguments.

            You are clearly, and selectively, conflating universal human failings as associated only with specific “High Liberal” institutions. Actually, you’ve started to back-track a little and say the Right does it to, but all your examples and argumentation are targeting the “sweet High Liberals” who are apparently, in your view, nasty authoritarians.

            For what it’s worth, I appreciate your expression of moral concern for people. I am contemptuous of many libertarians (like the bloggers at Volokh) more broadly because I don’t think they share that at all.

            And hey, you didn’t ban me, like those hypocrites at Volokh. So I respect that.

  • Alan Moran

    This is a great blog.
    For those of us taking the view that regulation is generally always bad
    it would be useful to start thinking of areas where it may be a Good
    Thing.

    Tariffs, quotas and barriers to new entrants have been the
    more egregious types of regulation. Their
    substantial reduction over recent decades has been the kernel of the
    deregulation program that has propelled economic growth throughout the world. Wage legislation, requirements to negotiate
    an unfair dismissal requirements are similar economic regulations with negative
    effects. And industry policy from Japan
    through South Korea has largely been cosmetic and where it had teeth it had
    negative impacts.

    Nor is there any case for preventing monopoly, even of “essential
    facilities”, not least because, as Adam Smith recognised, it resolves itself because
    the cartelisers, absent government support, will undermine their own agreements
    even if newcomers don’t arrive.

    So what areas of government intervention, outside of
    policing and protecting property rights and life and limb might be legitimately
    regarded as having had proven value?

    Deirdre has nominated the banning on coal burning in England,
    clearly an unambiguous benefit which would be difficult to have been achieved
    without regulation. Noise limitations on
    vehicles might fall in this category. She
    has apparently rejected patents, copyright, (trade marks, the right to obtain
    individual benefits in a mineral discovery?) and other extensions of
    traditional property rights that I would consider to have been, on balance,
    beneficial.

    Areas in consumer law where regulations might have had
    positive effects have been suggested to include, flammability of nightwear, slat
    sizes in cots where the risks were small and producers/customers might not have
    recognised them.

    Some areas like machine guards might also qualify even
    though safety has been subsequently used as an avenue for unions to seize
    control over enterprises.

    It seems that requiring portability of phone numbers has increased
    competition and provided benefits of the non-Schumpeterian kind.

    One area that, ostensibly, should clearly be ruled out is
    discriminatory taxes on sin goods (which actually soak the poor). They, like taxes on fat food taxes are an intolerable
    intrusion onto individual liberty. While
    “second hand” smoke from tobacco is a furphy, the regulations that have almost illegalised
    cigarette smoking around the western world have forced half the adult
    population to stop smoking, almost certainly to their benefit.

    Assembling a taxonomy of areas where regulatory intrusion by
    the state might be useful would clearly be challenging but is an area that is
    not explored except by those favouring big government.
    Alan Moran

    • Deirdre McCloskey

      Yes, I entirely agree. It’s an empirical matter, an should be approached as a matter of fact in any particular case. I just don’t see what we gain by dogmatism

  • Lavaux

    The fatal flaw in the case against capitalism is that its aim is to produce better outcomes than competing economic systems. Wrong. Producing better outcomes is the aim of statist economic systems competing with capitalism, with “better” usually defined as “fair” or “social justice”. Capitalism’s purposes cannot be measured by the fairness of its outcomes because it doesn’t aim for fair outcomes. Rather it aims for economic liberty, the rule of law and lawfulness. Even so, it still outperforms all statist competitors in terms of productivity, efficiency, innovation, and wealth creation, but this is not the aim or purpose of capitalism.

    The fatal flaw in the case for statism is the assumption that a capitalist or mixed economic system will create enough excess wealth to seize and redistribute to satisfy statist goals. Wrong again, as Europe’s PIIGS are now demonstrating. The trouble with statism is that the state eventually runs out of other people’s money after creating an entitlement/dependency culture disdainful of the capitalist virtues of honesty, hard work, thrift and charity.

    Self-interest improperly understood, i.e. greed, provides an insufficient motive to capitalist enterprise. The aforementioned capitalist virtues must also be attained and applied to enterprise if it is to succeed. Statism kills these virtues. Hence the fatal flaw in the case for positive law, that is, that masterminds can devise laws that force and promote economic activity producing better outcomes without considering the virtues that must motivate underlying economic conduct. Prof. McCloskey’s extensive catalog of examples demonstrates how time and again positive laws not only failed to achieve their goals of fairness but made matters worse. Much worse.

    We now have a federal government mismanaged by career politicians catering exclusively to special interests whose greed is untempered by any other virtue. This is why we are $16 trillion in debt, nearing insolvency and economic collapse, and wondering how the heck we dig ourselves out of this hole. My recommendation: Let’s get back to basics: Economic liberty, the rule of law, lawfulness in commerce, and the cultural elevation and practice of the capitalist virtues.

    • Deirdre McCloskey

      Dear Lavaux,
      I of course agree. It’s put best by the Two Cow jokes (google them and see):
      CAPITALISM, AMERICAN STYLE: You have two cows. You sell one, buy a bull, and build a herd of cows.

      BUREAUCRACY, AMERICAN STYLE: You have two cows. The government takes them both, shoots one, milks the other, pays you for the milk, then pours the milk down the drain.

      AN AMERICAN DEMOCRAT: You have two cows. Your neighbor has none. You feel guilty for being successful. You vote people into office who tax your cows, forcing you to sell one to raise money to pay the tax. The people you voted for then take the tax money and buy a cow and give it to your neighbor. You feel righteous.
      AN AMERICAN REPUBLICAN: You have two cows. Your neighbor has none. So what?
      Regards,
      Deirdre McCloskey

      • WhoGives?

        The joke is funny, but lets not forget that Conservatives give 4x as much to charitable causes (“their neighbors”) as Liberals.

        • citationplz

          Source?

          • Deirdre McCloskey

            Google “three-cow jokes”

          • econstudent

            just curious, is that stat mean conservatives give 4x as more as a percentage of their wealth or 4x the amount?

        • Damien S.

          http://www.realclearpolitics.com/articles/2008/03/conservatives_more_liberal_giv.html

          “Although liberal families’ incomes average 6 percent higher than
          those of conservative families, conservative-headed households give, on
          average, 30 percent more to charity than the average liberal-headed
          household ($1,600 per year vs. $1,227).”

          “People who reject the idea that “government has a responsibility to reduce income inequality” give an average of four times more than people who accept that proposition.” (Note: relative incomes of these groups is not given.)

          Problems: do liberals live in higher tax states and cities, or states and cities with higher cost of living, and therefore have less real disposable income?

          What’s being counted as charity? Tithing to churches and donations to wealthy colleges, or only donations to help the needy?

          Is donating less out of pocket, but voting for higher taxes on yourself, being less charitable? After all, the latter is creating a right for someone to take money out of your pocket.

          http://www.nytimes.com/2008/12/21/opinion/21kristof.html?_r=1

          “It’s true that religion is the essential reason conservatives give
          more, and religious liberals are as generous as religious
          conservatives. Among the stingiest of the stingy are secular
          conservatives.” Whoops.

          “According to Google’s figures, if donations to all religious
          organizations are excluded, liberals give slightly more to charity than
          conservatives do. But Mr. Brooks says that if measuring by the
          percentage of income given, conservatives are more generous than
          liberals even to secular causes.”

          I can’t find anything on how much *libertarians* give to charity. Though from Haidt’s moral foundations research, I’d guess less than conservatives.

          • econstudent

            very thoroughly responded. thank you.

    • Counsellor

      Capitalism can be described but not defined. It has no program of “purpose” or ideological objectives. It is a *resultant condition* of human interactions brought into existence (though not with the same periodization) by the same factors that form the social orders in which it provides the operating formats for what are designated as “economic activities.”

      • miles tracy

        Capitalism? Capital must exist and can not exist in two places at the same time. Or it doesn’t exist and then this is defined as theft. Capital must be invested. Ie. exchanged.

        • Counsellor

          We must be considering different relationships. You seem to be referring to some type of material substances that you label as “capital.” When we describe “capitalism,” as the observable procedures of human interactions, the greater part of those interactions are comprised of “services for services” (read, Bastiat) in which A does something for G, who does something for T who does for still another until it comes back to A as things done for A as a result of services to A from P,Q & R. Material substances may be required or may facilitate the services, or in combinations (restaurants-food, cooking, serving, cleaning, the deliveries , etc.).
          In addition to the material substances that function in the exchanges of services, there is also trust, more often referred to as “credit,” which has many of the same functions as the material, and “credit” like services can be, and is, dispersed, the same utlimate trust reliance being used in many transactions (places) at the same time.
          Think again. Per Jacobi “invert, invert, invert!”

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  • Major_Freedom

    Dear Deirdre:

    I apologize for the anonymous username. I don’t have a blog but I promise you I am not here to antagonize.

    I enjoyed this blog post, because it is very approachable by persons of all ideologies. It’s how I don’t write very often.

    My question is this: Have you read Hoppe’s critique of Rhetoric and Hermeneuticism, in his article “In Defense of Extreme Rationalism”? I am tremendously interested in what you think of it. If you have read it, did you write a response? If not, would you consider a response?

    Thanks very much.

    Major_Freedom

    • Deirdre McCloskey

      I replied to Hoppe at the time, and it is reprinted as a chapter in my Knowledge and Persuasion in Economics (1994)

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  • Sandy Bracy

    Dear Dr. McCloskey,
    “Publicity does better than inspectors in restraining the alleged desire of businesspeople to poison their customers.” Agreed.
    What is the role of media in your view? You have taken on MSNBC, NYT and Fox, and in the thread, Sinclair and Dickens. What type of publicity then is “market approved”?
    Also, if no regulation exists, such as in references to meat inspection and McDonald’s in this thread, what should be the recourse for the consumer who is that 1 in 10 million to actually be poisoned? Our current regulations do not benefit the consumer but rather shelter industry and limit liability. Would not a few murder convictions of food handlers lead more efficiently to safe practices? (I’ll add that I am not trying to disparage the food industry, simply referring back to your use of “poison” and references from other posters in this thread.)
    Thank you,
    Sandy Bracy

    • Deirdre McCloskey

      I have been told not to use letter form, so I’ll stop with that old-fashioned courtesy.
      If MacDonald’s kills one person, MacDonald’s is finished. That’s why chains are such a successful innovation: the big companies are terrified that they will screw up; Ma’s Eats has less at stake.

    • http://independent.academia.edu/DannyFrederick Danny Frederick

      I don’t know that the notion of ‘market approved’ publicity makes any sense. In an open market, anyone can say anything, and anyone can criticise what anyone else says. The resulting debate enables people to assess the various positions and rate them as better or worse (which is not to say that everyone behaves in that rational way). In this process, reputations are made and broken; and sensible people who are not experts in a particular topic will tend to pay more attention to people who have acquired a good reputation in talking about that topic than to people who have acquired a bad one. ‘The market’ does not pronounce a judgement on who is right: there is no ‘official’ position. Given that the experts can be counted on to disagree amongst themselves, this is a desirable state of affairs. Each person has to decide what to think for himself, and different people will decide in different ways. Having an opinion on anything is always risky, especially if you are going to act on the opinion.

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  • http://www.facebook.com/people/Paul-Marks/1266358046 Paul Marks

    A good article.

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  • http://www.facebook.com/dwayne.stephenson Dwayne J. Stephenson

    I like how the argument is just “look at these bad things states have done,” as if we have some baseline to compare what history would have been like if we had all just imbibed the libertarian tea at the turn of the twentieth century. The real question is, “how could this have been better than it was?” While this is a question I think we can all get enthusiastically behind, actually answering it is much harder than the author makes it out to be.

    • Deirdre McCloskey

      Dear Mr. Stephenson,
      I was merely raising warning flags, “cherry picking,” as Brian Leiter indignantly said. I don’t think most left-wingers, or many right-wingers for that matter, have a sound grasp of What Happened in History. They believe that everything unions did (oppose immigration; exclude blacks and women) was good. They believe that Robber Barons were bad for ordinary people (Carnegie caused the price of steel to fall to 1/3 of its price in the 1870s). They believe lots of things that ain’t so.
      I never said that no government action was desirable. Traffic lights. Murder investigations. The Good War.
      But, I implore you, think on some of the terrible things that even our relatively benign US government has done: the War on Drugs; the Iraq invasion; support for Jim Crow; Cook County hospital until recently.
      Conclusion? Step carefully when recommending extensions of the realm of compulsion. Markets and grace are nicer. Not always better, but always nicer.

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  • Alessandro Carraro

    I think it’s difficult to disagree with the basic statement that each law and regulation should be subject to a rigorous cost/benefit analysis. But in an uncertain world this is a less useful suggestion than it actually sounds. It’s often not possible to perform such an analysis. Most of the time the result depends on individual preferences which are almost impossible to evaluate and that can easily change.

    But I have a deeper objection to any proposal which is far from the status quo. The current economic system is the result of a freely evolving economic system. The state is the result of free will of the overwhelming majority of the population. There are people who reject such compact (be they criminals or revolutionaries), but they are generally a small minority. Surely biology teaches us that, the species we observe are best adapted to that environment. Obviously evolution sometimes takes the wrong turn and needs to re-start from previous templates, so it’s possible we will transition to a much lower level of state control, but surely it’s unlikely that a large change would produce a big improvement.

    All freely evolving markets develop internal rules. These rules are very similar to official regulations. The current set of commercial law evolved from freely developed conventions. I fail to see what external agent has constructed the current system, but the natural evolution of human behaviour.

    This is not to say we shouldn’t try to change things and see if the change produces a better result. I am just doubtful radical change is a priori the best course of action.

    • Deirdre McCloskey

      Dear Mr. Carraro,
      What a wise and penetrating statement! You are making an argument for gradual improvement like that advocated by the Scottish (as against the French) Enlightenment. But you and I might agree that it was a good idea to drop laws of resale price maintenance started in the 1930s; or to let lawyers advertise (hmm: not sure on that one!).
      Sincerely,
      Deirdre McCloskey

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  • Forstena

    DMcC’s arguments are cogent, consistent, and convincing, but
    could be strengthened even more by adding insights from collective choice and
    public choice theories. I’ll take a stab
    at that.

    There is no social welfare function that can be
    representative of people’s preferences in a large, diverse society. “Maximizing welfare” is therefore an empty
    concept. Under simple majority rule,
    decisions cannot be transitive, and collective decisions are neither
    representative nor stable. Welfare rules
    can then only be imposed, at the cost of individual liberty and ultimately the
    viability and legitimacy of the system.

    Therefore, when someone says “it takes a village,” run for
    the exits, for “village” is just a code word for collective imposition of the
    will of a temporary majority. Such a
    village is destructive of the small-group representativeness that is possible
    on a village green, with unanimity as the decision rule. You are then free to choose your village, and
    true villages will differ, thrive, and multiply. In a free society, you must be
    free to choose your village, and no central authority can be empowered to
    homogenize them.

    Bureaucratic rule making is not representative of collective
    values but of bureaucratic self-interest.
    Bureaucracies are self-perpetuating.
    They epitomize the Rule of Unintended Consequences that is endemic to
    agency. Agencies, whether private or
    collective, cannot, by their very nature, be adequately controlled by the
    interests they are supposed to represent.
    Ultimately, they will undermine the rule of law.

    “Social justice” is neither but another code word that
    stands for Big Brotherhood. It is an
    imposition of a moral code founded on some fuzzy concept of “collective
    morality” – a misleading notion that deliberately obfuscates the necessity of
    using force to impose a particular ethic on a minority. This cannot be moral, by definition. Good behavior must be taught, not enforced by
    police power, for a just society must be built on individual volition. Force only creates resentment and
    disobedience. Forced redistribution of
    wealth or the suppression of talent destroys individual morality, for both
    forced donor and dependent “beneficiary.”
    The result is a gulag, not a free society.

    Ethical behavior cannot be built on “rights,” but must have
    as its foundation individual acceptance of duty and virtue. High Liberalism and socialism are destructive
    of both duty and virtue, and therefore cannot create a just society. These are also facts of some relevance.

    Carl J. Dahlman

    • Deirdre McCloskey

      Dear Carl,
      You know I agree with you. The core problem with compulsion is that it relies on a notion of the General Will (Rousseau again).
      Regards,
      Deirdre

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  • Gepap

    I am sorry, but how can historical supposition be claimed as fact? History happens once. How can one claim that Soviet central planning retarded economic growth in the areas covered by the Soviet Union as fact when we have no actual opposite to compare it to? One can make the arguement that this would have been true, but it is logically impossible to claim it IS true.
    Also, this essay seems to imply that we should include the study of anthropology in our examination of our world – to which I ask, can Prof. McCloskey point to any agricultural society that has advanced past a bronze age technological level that lacks government and the accompanying regulatory system of life (be it forcing the tanners outside city walls, or making certain acts like eating certain types of animals forbidden and thus making their rearing illegal)? Has any human group achieved the same level of wealth and well being currently achieved by liberal social democracies absent a government? The professor spoke about history as an experiment, which is fine, but I would posit that the fact that all technologically advanced, rich societies that have come into actual being historically have governments shows that government is a basic HUMAN instituion, withouth which advanced economic life is utterly impossible.

    • 3cantuna

      This is where the Austrians, especially Mises, trump the empiricists (Friedman, University of Chicago types) when it comes to economics and history. Yes, of course– great point– no real testable comparisons can be made. Human events are always a one-off and utterly complex. Empiricists would have to be mind-readers with a time machine to back up their methodological claims. However, economic propositions, logically sound via aprioristic deductive method, apply to man regardless of time and place. If McCloskey had backed her data with Misesian insights– then you would see that (most of) what she claims is indeed true; assuming that she gets the basic facts right too (which is difficult in itself).

      Even with economic tools– the enormity of the past requires ‘understanding’, a non-scientific term covering all of the uncertainty and asymmetry your comment acknowledges.

      E.g. Timeless economic proposition: Inflation, ceteris paribus, leads to watering down the purchasing power of the monetary unit.

      Wouldn’t this statement hold true– whether in Ancient Rome or 2015 USA? Same for minimum wage, etc etc etc

    • Scott Vonasek

      All technologically advanced nations have crime. Their are no exceptions, does this mean that crime is a basic HUMAN instruction, without which advanced economic life is utterly impossible?

      • Gepap

        Crime can only exist in the presence of Law (crime being defined as breaking the law), so anywhere the concept of legitimacy comes into existance, its opposite must as well. So, YES. Humans aren’t angels – they tend to have disagreements, many on the basis for what is legitimate or what is right. Humans also have emotions and passions and desires, some of which may be considered by others as illigitmate, or lead to violent acts.

        • Scott Vonasek

          It is true that crime can only exist if behavior has been catagorized into acceptable or unacceptable. The existence of law as you have called it does not require government. Highly effective private courts have existed in the past. Merchant courts in Europe where an example. None of this means that crime is necessary for prosperity.

          So back to your original question. Are governments necessary for prosperious society or are governments a parasite that emerge to pet on the wealth creating process? Just because both processes are associated don’t assume cause and effect.

    • Deirdre McCloskey

      Dear Gepap,
      One more time . . . It does not say anything about the desirable size or powers of government to say that we need a little of it. We need water. But if we drink 20 gallons all at once we willdie, yes? You see my point.? No one wants “absent a government,” and so it is unhelpful to keep saying “But we need a government.” I agree. It’s a basic human institution, like war and marriage, both of which we can have too much of, yes?
      I suggest that you think through your love of governmentds, in light of their abuse—we are seeing it today in the lynching [a carefully chosen word] of the Attorney General. Government, with its powers of violence.
      Sincerely,
      Deirdre McCloskey

      • Gepap

        Prof. McCloskey:
        Saying that we want less “government” and creating a working system by which conflicts between vastly different private aims, desires, values, and ideals can be resolved are two different things. You made the claim that private market action would be better at stopping the harm caused by externalities than government action – my question to you would be what would the mechanism be that could make that happen? Can you honestly tell me that one could design a “free market” system by which a relatively powerless or poor individual could seek relief from the acts of a powerful or rich individual on anything even remotely approaching an even field? And yes, 99% of the time, ‘government’ will be on the side of the powerful already, but modern social democracy has been one of the few systems that has been able to deliver a little bit of balance between powerful and powerless private parties.
        I will also add professor that it does not make for an open or good debate to make assumptions of the intentions of others – I seriously doubt you read minds, so you have no basis other than pre-conceptions and prejudices to claim I “love” government based on my statements.

        • Deirdre McCloskey

          Dear Gepap,
          I nowhere say that “private market action would be better at stopping the harm caused by externalities,” always. I say “sometimes.” You insist that I say “always,” which of course makes it easier to disagree with me.
          99% of the time the Golden Rule holds—those who have the gold, rule. Yet you wish to expand (that’s what I mean by “love”) government.

        • Graham Peterson

          “my question to you would be what would the mechanism be that could [make the] private market … stop the harm caused by externalities?”

          Note that just about every externality gets identified first in the private sphere – the lobbying of the government to do something about it comes after. So if we let “privately, peacefully behaving adults” = “the market,” we begin to see that the market in fact *does not* fail in any real sense. The market in fact identifies its own suboptimalities. (This kind of argument sounds absurd to those who equate “the market” with “guys in suits and jets,” but consumers do a lot of talking, ergot have a lot of market power.)

          So how do you correct externalities in the private sphere? Lobby the private sphere, that is — one another. And that’s not just a plausible alternative to carbon and cigarette taxes, it’s indeed the way *most* bad behavior has been mitigated anciently — through gossip.

          McDonald’s does not post that a Big Mac contains the grams of fat recommended for three days because they are required by law — it is a case of successful, peaceful, civil persuasion among educated and consenting adults.

        • Graham Peterson

          And in the event that the immediate counter is “but the guys in suits and jets own the media,” consider that in the case of A) advertising, no one had to be brainwashed to want a better product to, say, clean something the whole family defecates into every day — and in the case of B) fictional and non-fictional story telling, a majority of that telling happens among coworkers, families, and friends, even accounting for the four-some loony hours of television the average industrialized person now watches (a number that is dropping now that people watch online and with advanced cable boxes and can be selective).

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  • Graham Peterson

    There is a third-way here, that governments, unless *extremely* large and oppressive, have very little influence on markets or any other social institution, because people aren’t inherently knaves and are genius at solving-regularly, collective action problems, bargains, moral dilemmas, negotiations, and disagreements.

    Everyone has got their underwear bundled about politics because they are usually fundamentally arguing over whether or not we ought to care about one another, try to help one another, and try to get along — with one side accusing the other of revealing an ethical vacuum of all of the aforementioned.

    Politics is ethical pageantry. If one wants bickering siblings to go away because there is important work to be done, one must ignore the bickering children.

  • Bjorn

    “How do I know that my narrative is better than yours?”, well, you don’t. There is no way to settle empirically 100% the effect of the various policies regarding unions, various regulations,
    “family-wage” legislation, externalities etc so it boils down to a value question. You can always find empirical support for you view.

    As a citizen of a heavily taxed, big government, oil rich (with state owned and dominated oil sector which does not benefit the people ), strong unions, state provided health care and education, generous unemployment benefits etc etc (the country is Norway), it is a miracle we are one of the riches countries in the world with record labor participation and productivity should your narrative be “factual”.

    Of course we could maybe have been even more rich and productive..

    • Deirdre McCloskey

      Bäste Bjorn,
      I think you are too pessimistic about the possibilities for scientific history and economics. There are indeed ways to settle empirically—maybe never 100%, but what science can do that?—the effects of, say, the effect of Norwegian trade unions in shipping on the ethnic composition of Norwegian-owned ships, and then on Norwgeian incomes. Norway has one of the lowest numbers of hours worked in the OECD, yet almost the highest income ($147 a day, as against $127 in the USA)—which says to me that to sneer at social democracy from a merely allocative point of view is not intelligent; but that what matters are the conditions of innovation, which are favorable in Norway. France is a similar puzzle to economists devoted to the erroneous claim that “perfect” static allocation is what makes a country rich. Henry Kissinger liked to say that France was “the only succcessful communist country.” France is innovative to this day.
      Vänliga
      hälsningar,

      Deirdre Nansen McCloskey
      Vänliga
      hälsningar,

      Deirdre Nansen McCloskey

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  • James Woodward

    As others have said, Dr. McCloskey, excellent post. Coincidentally, I checked your book “Knowledge and Persuasion in Economics” out from the library shortly before I came across this post but have not had time to read it yet. I saw passing mention of Upton Sinclair in the comments and wonder if you are too quick to dismiss some of his insights. As you imply, The Jungle is a novel and was not actually intended to bring about reform in the food industry, even if that was the effect and what it is remembered for. The irony was that he was trying to illustrate the barbaric nature of packing plants toward workers and instead everyone focused on hygiene, a fact Sinclair lamented. The book was also widely rejected before he finally found a publisher.

    I’m not a socialist (far from it), but I am starting to think that he may have had some insights into how capitalism functions America, mainly with regards to the “flow of information”, so to speak. He wrote the “Dead Hand” series of books about what he saw as structural flaws in capitalism. I’ve yet to read any of them at length so I can’t really comment further but they don’t seem to be very well known so I thought I would mention them. Based on what I have read, he was particularly prescient about the consequences of “capitalist” journalism, for example. I wonder if his naive endorsement of socialism was, at least in part, a knee-jerk reaction against whatever might have passed for mainstream (economic and otherwise) thinking at that particular time. As prosperous as the Industrial Revolution period was for the US, it doesn’t seem like society much resembled the one Adam Smith envisioned. If it was “sold” as such to the public, then it is no wonder that Sinclair would write so many books condemning a distorted view of the “invisible hand”.

    • Deirdre McCloskey

      Dar Mr. Woodward,
      Thanks for your judicious and openminded post. If Sinclair spotted some badness in meatpacking and oil drilling (There Will Be Blood is the movie from his book Oil), the spotting does not imply (as you note) that we can reasonably do anything about it. Slaughter houses are nasty places in the best-run societieis, for example. The trouble with the Sinclair take is that it has no alternative in mind: Soviet factories were worse.

  • zosima

    If we’re going to talk historical empirical examples, it seems like the case for big government is easy to make.

    #1 There are essentially no contemporary examples of effective, productive, and innovative economies that are not structured within a government. We might not take this as evidence that government is good, but we should take this as evidence that government is probably an inevitable outcome of human power relations over time.
    #2 Corrupt dysfunctional economies tend to prevail in areas with weak ineffective governments.
    #3 Regions that have stable governments with reasonable mechanisms for centralization of some functionality tend to be most successful economically.
    Your article tries to make its case by stating examples of failures of governments, which, given the extent of history, there are many. Just as there are many failures of capitalism. We can’t just look at your list of specific government failures and determine that it is sufficient to make your case. We need to be able to generalize. I do that roughly above, but getting statistical would, of course, be better.

    • Deirdre McCloskey

      Thanks for ariticulating the left’s case so lucidly.
      #1: The argument is standard on the left (and in another version on the Burkean right: “Hierarchy is ever with us. So [?] we should honor it and expand it”). It is dubious. No one except the most extreme Steinerian anarchist is saying that we should have zero government, or that many societies have existed without it. The question, which the left’s argument strides by, is whether empirically it’s a good idea to have a government that spends 35 or 50 percent of national income and claims to regulate much of the rest. Be glad, said Will Rogers, that you don’t get the government you paid for.
      #2: Yes, but no one, to repeat, is arguing that zero government is a good idea. And consider the opposite case, too: the Soviet government was by no means dysfunctional. It functioned well in terribly mismanaging the economy: it intended to do so, and did it. The Zimbabwe of Robert Mugabe, which has the lowest per capita income in the world at present, sits beside a pretty well run Botswana, with a low share of government direction of the economy.
      #3 Ditto. As you say, we need to get quantitative about it. My list of government failures were all based on historical studies about claims made by the government-favoring left. They were not random: they were the worst cases for a small-government position; even those show how badly government does. We are rich because of private initiative for profit, not because of governments.

      • Jack Silverman

        “pretty well run Botswana” seems a curious statement. I wonder what kind of rhetoric is involved there. As for your discussion with Zosima, I cannot really get any idea who is right there. If there is less central government in Botswana, then is it not the case that there is thus more local or tribal government, or do they live free and clear without government in Botswana?

      • zosima

        I’m not sure you’re really making your case. Again, a couple of cherry picked examples.(Seriously, how many times has Zimbabwe/USSR been used to make the conservative case for small government, tens of thousands? Hundreds of thousands?)

        Also, you want to focus on government revenue as a fraction of national income, but that is a pretty poor metric. Regulations and government ownership can create an effectively large government even as government revenues are small as a fraction of income.

        Looking at your example of Botswana. Its economy is largely natural resource exports, 62% of those are diamond exports. The largest diamond company doing the exports is half owned by the government. Not exactly what conservatives have in mind when they talk about the night watchman state…and exactly the reason why it is dangerous to generalize from a handful of instances.

        For starters, you might want to stick to examples from advanced economies that are not communist.

        But something like this is even better:
        http://www.imf.org/external/pubs/ft/weo/2012/02/pdf/c1.pdf

        According to the IMF, advanced economies that shrunk the size of their government experienced economic growth below expectation.(See Box 1.1) I’m not saying this is a knockdown argument, but it is the type of argument that will actually prove or disprove your point.

  • http://profile.yahoo.com/OVSIJ4Y7IEFIL75ZBODTTFRNIU lex

    Yesterday I posted a photograph of President Obama eating MY free lunch. He and his cronies will be having my free lunch long into the foreseeable future. Market failure and Market fairness as a popular excuse or cause for their expansion of power over free markets is just a means of putting other people’s food on their table. Marxism for politiicans is like honey for ants. We now have almost 140 years of statistics that show that dictators of the proletariat become obscenely rich and their subjects become destitute. In softer so called socialist countires we see an ologarchy of rich socialist with their feet grounded more internationally than the more common average citizen. There is not excactly any data of Market fairness coming out of places like Norway. You might have read about that crazy guy who went to shoot up Norway’s most elite children who got to spend time on an island—not everyone’s children get that kind of special treatment as future leadership. What is fair about that? There is a class of people in Norway that believe it is only suitable for them to take care of the rest of Norweigen society. sounds great ///everyone gets their fair share according to the people who decide. The article is right about bleeding hearts….have you ever listented to the BBC or Ted Turner CNN talking about the UN Feeding the refugees? feeding programs ……thats exactly what these people want to do to you as refugees of capitalism. The remarkable thing about free markets is that virtually everyone gets fed without government being involved anywhere. Where government could do some good they don’t . we have floods on the mississippi for a number of years and billions of fresh water are wasted, land erroded and damage done. well the army corp of engineers can actually do things to prevent the flooding and provide water for irregation on demand, replenish aquifers, build up the gulf coast with diversion streams, and provide for greater river access/ transportaton ect and in stead it can’t do a thing with bleeding heart wacko enviornmental laws preventing any thing that would enhance human values of government owned riparian values.

  • Jack Silverman

    McCloskey:
    “I realize that Kant laid it down that what humans are factually like, or
    what their history factually was, is forbidden to play a part in
    ethical reflection. …”

    A more Chomskian way to look at that is that the “real wold” is simply so horrible that could not be relevant. Who cares what the “real world” has to say if it is just genocide and death?

    The question is that of how some kind of benefit for humanity, or any kind of improvement at all can come, after such a dismal factual record.

    Planning is a huge challenge but would come on top of all the gains of the free market over the years. And all these gains are very “dismal” and small in a terrible world full of suffering. The day for planning will come – if anything at all comes …

    • Deirdre McCloskey

      Dear Mr. Silverman,
      I realize it is strangely comforting to think that, say, the United States or France are terrible places on account of a lack of planning. And I also realize that it is common in some circles to find merit in, say, Stalin’s central planning, or Mao’s, or Castro’s. But note the direction of migration (for example), people voting with their feet. Or note the gigantic expansion of human scope under capitalist regimes like those of Sweden or California or Japan. You and I are thirty times better off than out ancestors in 1800. Central planning did not achieve it. Central planning sounds good to intellectuals, who reckon that they will be in charge. But consider that under central planning you and I might be assigned to the coal mine, and that coal would be underpriced and therefore rationed, and that cars would be overpriced and available therefore only to members of the party—which we by ethnicity or integrity of politics might be excluded from.
      Sincerely, Deirdre McCloskey

    • Deirdre McCloskey

      Dear Mr. Silverman, I suggest you look soberly at the facts, then come back and tell me whether you still believe we are not spectacularly better off than we were 50 or 100 or 100 years ago.

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  • oli

    “crony capitalists”… sorry to say, that’s the most I know, and you say nor to move on it,will make it worse… for whom? the humiliated are beaten already… for you the priviledge in finance and academia?

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  • Paul Hield

    Don’t just learn from 20th century history, look to 19th century Victorian Britain if you want to see a vision of a Libertarian society with the masses enslaved. It was a reation to the inevitable consequences of Libertarianism enslaving the masses that various means of collective protection had to be created. The collective creations whether government or union may well not be perfect, but they were far better than the virtual slave economy of a Libertarian regime.

    • Deirdre McCloskey

      Dear Mr. Hield, I am surprised that you believe that free labor in the 19th century was slavery. You are channeling in that respect the anti-industry conservativism of Thomas Carlyle, who believed just that, and admired slavery. Consider the possibility that you might not know much about the 19th century.

      • Paul Hield

        Deidre,

        your comment is a little cryptic to me.

        I believe it is widely held that working conditions for the working poor in Victorian Britain were appalling and would have been hard to distinguish from slavery. It was in response to these conditions that many of the laws that protect employees were derived. I would welcome any corrections to that view.

        I am not anti-industry and certainly not pro-slavery so I don’t understand how you have aligned my comments with the views of Thomas Carlyle and concluded that I am anti-industry and pro-slavery.

        If you feel my views are derived from ignorance of Victorian Britain, then it would be more useful to the debate to correct my ignorance rather than merely state that I am ignorant of key facts without giving a clue as to what you allude.

        Kind regards – Paul

  • ThaomasH

    “The story is, in a few brief mottos to stand for a rich intellectual tradition since the 1880s: Modern life is complicated, and so we need government to regulate. Government can do so well, and will not be regularly corrupted. Since markets fail very frequently the government should step in to fix them. Without a big government
    we cannot do certain noble things (Hoover Dam, the Interstates, NASA).
    Antitrust works. Businesses will exploit workers if government regulation and
    union contracts do not intervene. Unions got us the 40-hour week. Poor people
    are better off chiefly because of big government and unions. The USA was never
    laissez faire. Internal improvements were a good idea, and governmental from
    the start. Profit is not a good guide. Consumers are usually misled.
    Advertising is bad.”

    Whether or not this was a good summary of the high(?) liberal tradition starting in 1880, it is a caricature of liberalism at least since the 1990′s and to deny these mottos produces not indignation but suspicion, suspicion that a diametrical argument is being made or insinuated: that markets never fail and that government regulation can never ameliorate the failure, that there are no public goods that can only — so far
    as we know — be provided by the state, that private profit is an infallible guide
    to public welfare, that consumers cannot be misled and that those who make it
    are in the thrall of a libertarian vision no less utopian than that of classical
    democratic socialism.

    • Deirdre McCloskey

      Dear ThaomasH: I do not think you are right about the factual and historical suppositions that most of our left-liberal friends make. Watch MSNBC (I do, a lotl): you will hear from Rachel Maddow and others just such suppositions. Maddow (whom in many ways I admire) has even an advertisement standing in front of (I guess) the Hoover Dam, saying that we need government for such glorious work. And you make your indignation too easy by characterizing my position as saying that “markets never fail and government regulation can never ameliorate the failure.” You can read for example even in my old textbook, The Applied Theory of Price, the case for externalities and government. . . balanced. The lack of balance is on the other foot.

      • ThaomasH

        I no longer recall the exact point I was making that you are responding too.  In general I think that conservatives and libertarians underestimate the amount of overlap in views they have with some liberals.  I at least would disagree with Ms Maddow on many economic issues.  But it seems to me that libertarians fairly often overlook externalities and other market failures, just as liberals fairly often overlook government failure.  I think good public policy making needs people with both biases and bring as many facts to the table as possible.
        If the Hover Dam was a good idea (I suspect benefits exceed costs even though the benefits have been vastly reduced by the failure to properly price the water it allows people to use) then government probably WAS necessary to allow its construction.

  • http://twitter.com/AnotherWayNow M.Bohannon-Kaplan

    Took a course exclusively on Kant at UCB and never really “got” him. Unfortunately my professor agreed.

  • Deirdre McCloskey

    Dear Allen, I suggest you earn to spell “alcoholism” and “lesbianism” before publishing your homophobic nonsense.

  • tim_lebsack

    Will DM’s argument lead to the removal of regulatory agencies or only to those same agencies asking for more funds in order to “improve our performance” / “add additional safeguards” / “prevent our vital services from being diluted” ???

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  • Greg Webb

    Professor McCloskey, I enjoyed reading your blog for its persuasive logic and objective, verifiable evidence. I will have to read your books.

  • Bill

    “How do I know that my narrative is better than yours? The experiments of the 20th century told me so.”

    The first sentence I quoted is presumptuous because you presume to know my beliefs. It’s condescending for the same reason. The entire article is patronizing.

    Writing simple clear prose takes more effort than narcissistic intellectual babble.

    Also, the examples cited are overwhelmingly cherry-picked to support one-side. Many of the issue you mention, unions, energy, financial regulation, are far more complicated than your article implies.

  • Bill

    Note, my previous comments don’t imply you’re completely wrong, you just need to work on your communication skills.