McCloskey Destroys Sandel

By On August 10, 2012 · 16 Comments · In Book/Article Reviews

Dierdre McCloskey refutes Michael Sandel’s last book here. Worth reading the entire thing.

 
  • Sean II

    “When I talk to friends who think like Sandel I worry that their dispositions will kill, quite unintentionally, the only chance for the world’s poor to achieve the scope for a full human life.”

    I guess it’s important to remain polite even in a scathing book review, but I just don’t see where “unintentionally” enters into it.

    If someone is so revolted by markets, profit, voluntary exchange, self-interested action, prices, etc. that he is willing to let a sick kid go without a kidney, what part of his result in unintentional? If that is his demonstrated preference, shown by supporting the same or similar policies in case after case, then WHO CARES if he throws in a stated preference to the effect that he really wishes that kid could somehow get a kidney for free?

    Take even a trivial example like the rationing of Shakespeare. If someone abolishes the secondary market in theater tickets, and then he walks past the box office and sees a horde of angry people who’ve been baking in a sweaty queue for six hours, what right does he have to say “Oh, no, I never wanted that…”?

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

    McCloskey writes:

    Sandel makes a supporting argument much heard on the left that “market
    choices are not free choices if some people are desperately poor or lack
    the ability to bargain on fair terms” (p. 112). “The law, in its
    majestic equality,” noted Anatole France, “forbids the rich and the poor
    alike to sleep under bridges, to beg in the streets, and to steal
    bread.” Yet an economist could tell Sandel, and France, that
    “bargaining on fair terms” has little to do with how incomes arise, that
    is, how people get into or out of poverty.

    Spot the non-sequitur.

    • prasad

      It’s not a non-sequitur, unless you seek to deliberately misunderstand. McCloskey said that the best way to help bridge-dude attain the ability to make free choices is via the market mechanism. From where I sit, it seems like time after time, the left has shown itself utterly unable to confront the neo-liberal case that poverty eradication in China and India has happened through means that are distinctly non-leftish in tone.

      I’ll also say there’s plenty of convenient ‘exploitation shopping’ on the left. It’s nice and enlightened for you to object to sweatshops, but I do notice that most people who join you in this are looking more to bring those jobs back to the first world than to make them pay more money integrated over the third world. First world labor protectionism masquerading as compassion for the third world is a pretty ugly thing. Besides, faute the frickin’ mieux, I want to say. I don’t see why you *obviously* get to stop exploitative, but mutually beneficial, practices from existing just for being exploitative, without also providing for something better. If the problem is that you can’t sleep at night, take Ambien. Except that the typical First World philosopher is well on the left (but not, in economic matters internationalist enough), I’d say there’s nothing that prevents the academic community from “problematizing” exploitation-talk like this.

    • Robert Gressis

      Yeah, I also found this confusing. Is the point that, though very poor people indeed do not have free choices, the best way to eventually give them free choices is by using markets to help them become less poor? Or is McCloskey not conceding that very poor people’s choices are unfree (in which case, what *is* the point)?

      • prasad

        I thought she very explicitly made the former point in her article, (in fact on the very next lines after Chris Bertram’s quote) :

        “Yet an economist could tell Sandel, and France, that “bargaining on fair terms” has little to do with how incomes arise, that is, how people get into or out of poverty. True, many well-intentioned and bien-pensant folk believe it does. Because they do, most of them accept for example that going down and joining the union made workers better off, by giving them better bargaining power against the bosses, even though the historical evidence is crushing that unionization did not make workers better off (rising productivity did). ”

        and

        “That is, Sandel does not face the actual, moral problem—which is poverty, real poverty, the depths. Instead he recommends that we fiddle with prices and create queues for Shakespeare in the Park. ”

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

          Sandel claims that poor people are rendered unfree by their weak bargaining position. McCloskey replies that capitalism will make some other people (the next generation perhaps) materially better off in the future. Even if what McCloskey says is true, prasad, (as you believe it is) it doesn’t constitute a refutation of what Sandel claimed.

          (Incidentally, McCloskey’s piece is a nice illustration of the way in which those who espouse libertarian positions out of a commitment to neoclassical economics — see for example Tyler Cowen passim — tend to confuse claims about freedom with ones about welfare. Their deontological cousins typically avoid this. Back in the days when socialism was more popular than it currently is, a standard liberal/libertarian jibe against the left was that the left was prepared to sacrifice the freedom of people now for gains in well-being in some future paradise. How ironic, then, that we find McCloskey willing to embrace just such a politics.)

          • TracyW

            I don’t see where the sacrifice of freedom comes into it. As I understand Sandel’s argument is that the poor are unfree now, and McCloskey’s response is that the best way to get them to freedom is to embrace markets. Your criticism would only apply if Sandel was arguing that the poor are freer (despite being poor) without markets, and McCloskey was saying that we should embrace markets even at the cost of a loss of freedom now, in order to get to more freedom in the future.

            And nowadays the embrace of markets makes poor people in a poor country visibly better off within a generation (see China, Japan post-WWII, Hong Kong, Botswana), so I don’t see why you’re talking about “some other people”. (Whether Britain, Sweden, or the USA saw poor people becoming visibly better off within one generation I’m not so sure about, growth was slower back then and I don’t recall any vivid stories).

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

            Sigh!
            If I’m unfree because the superior bargaining power of those richer than me deprives me of effective choices, then a rise in my living standards won’t make me free unless my deficit in bargaining power also goes away. There are lots of things that McCloskey might have said in reply to Sandel on freedom, but saying that capitalism raises living standards simply isn’t responsive. Having my living standards raised doesn’t, in and of itself, make me freer! Freedom and welfare are different things and McCloskey (deliberately, for rhetorical purposes I bet) elides the two. A happy and well-fed prisoner in a cage is just as unfree as an unhappy and hungry one.

          • TracyW

            If I’m unfree because the superior bargaining power of those richer than me deprives me of effective choices, then a rise in my living standards won’t make me free unless my deficit in bargaining power also goes away.

            And the point is that a rise in living standards does make your deficit in bargaining power less. To take the Anatole France example, having a roof over your head (which is a rise in living standards compared with not having a roof over your head) does make you freer to not sleep under bridges.
            Or, to take another example, a peasant who ate their seed corn last year in order to avoid starving to death because the harvest failed is in a worse bargaining position than a peasant who got through the harvest failure without having to eat their capital. A well-nourished worker has more options for making money than one who is weak through prolonged malnutrition. A worker who has friends and family with spare food to share is better placed to walk out of a job than a worker who is the sole support for their extended family.

            Having my living standards raised doesn’t, in and of itself, make me freer!

            Perhaps not. But Sandel apparently thinks it does. To quote McCloskey quoting Sandel: “market choices are not free choices if some people are desperately poor or lack the ability to bargain on fair terms”. If McCloskey’s quote is accurate, it seems fair to read Sandel as implying that market choices are freer if people aren’t desperately poor. Of course Sandel does have this other clause in there about bargaining “on fair terms”, and it’s not clear the relationship between his two requirements, but McCloskey also criticises him pretty thoroughly separately on the bargaining power point and his lack of definition of fairness.

            And I think it’s reasonable of McCloskey to deal with “free” as Sandel apparently defines it. Surely Sandel’s ideas here are more important than quibbling about words?

            <blockquoteFreedom and welfare are different things and McCloskey (deliberately, for rhetorical purposes I bet) elides the two. A happy and well-fed prisoner in a cage is just as unfree as an unhappy and hungry one.

            Yep. But outside cages, freedom is positively correlated with wealth, and happiness. While the correlation is not 100%, and correlation does not imply causation, there are good theoretical grounds to think that freedom in general plays an important causal role in creating wealth (though it’s not the whole of the story!), and that wealth, and freedom in its own right, plays a causal role in happiness (though again not the whole of the story!)

            In the context of a short book review, therefore, it strikes me as reasonble to elide the difference between freedom and welfare. No one can always spell out every underpinning of their ideas and the evidence I cited about the connection between freedom and welfare is widely available.

          • TracyW

            I had better add that some limits on freedom appear to be necessary for wealth, eg limits on resource use to avoid over-exploitation. By “freedom” here I am talking about the difference between, say, North Korea and Denmark.

          • prasad

            “Having my living standards raised doesn’t, in and of itself, make me freer!”

            I guess this exchange (Chris Bertram and TracyW) is illustrative of a
            broader difference in view as to just what the badness (either in
            general, or of such badness as can be tagged ‘unfreedom’) of poverty
            consists in. If you think poverty is bad principally because others are richer than you, then Anatole France’s words mean something very different to you than if you think there’s such a thing as absolute poverty, or a basic basket of goods. Maybe what’s really terrible about the guy under the bridge is that he’s -living under the bridge- not that others have gardens. In that latter scenario, it’s better for the really poor not to be starving or to gain access to basic material preconditions of liberty, like water and sanitation and health and schools, even if inequality rises as a result. To me, it really does seem like ‘inequality’ based arguments only come into play when arguments based on absolute poverty have been exhausted or at least addressed to some large extent.

            “McCloskey replies that capitalism will make some other people (the next generation perhaps) materially better off in the future.”

            If generational compacts in society are just a matter of “other people” being helped, or of robbing Sam to pay Mac, instead of trying to do better by your children and future generations, why yes, I suppose McCloskey’s response will seem rather morally arbitrary! I don’t think this sort of view is very helpful though :)

            “Even if what McCloskey says is true, prasad, (as you believe it is)”

            I do wish you’d not completely ignore the allegation I (and McCloskey) made about how leftists in first world economies seem to have adopted exploitation talk as a mask (and for a cosmopolitan leftist, a rather uncharacteristic mask – at least Sandel is an unabashed communitarian and probably draws his borders with national borders. Rawls does that too, though it seems much less satisfying in his case.) for protecting their own labor markets. Manufacturing migrating to Asia via sweatshops and such has -decreased- not increased global inequality. Even if you think inequality is what ‘embaddens’ poverty, it’s not clear that you should therefore call “exploitative” free exchange bad for that reason. In fact that last point is almost generic – whatever you think of Warren Buffet buying a kidney for 50k, it’s certainly not inequality enhancing.

            (Btw, how does one format text here? I can’t seem to get i or em to work, same for blockquotes)

  • Lower Ed

    McCloskey rules. No doubt about it.
    I imagine a more just world where McCloskey,Tomasi, and BHLs replace the bankrupt Harvard elite. But even here the seeds of future dissolution lay, politics aside. Admittedly, politics is all too often more important than quality in matters of academics. At any rate, the fatal contradiction plaguing this new cadre is inherent to neo-liberalism, neo-classical-liberalism, or Cato libertarianism, what-have-you. To advocate the price system and levy public choice theory’s warnings on the one hand; then to recommend government directed welfare payments on the other; is nothing short of a confusion that could have massively destructive results.

  • https://plus.google.com/u/0/114865618166480775623/posts Russ Abbott

    McCloskey argues that Sandel fails to offer a philosophical framework for deciding when markets should be disallowed. But then McCloskey does the same thing. When would she approve of laws that disallows markets? Surely not all markets are ok. Would she really approve of laws that force compliance with contracts under which one sells oneself into slavery? If not, why not, and when should the force of the law be used (and not used) to uphold markets?

    • Lower Ed

      McCloskey believes that certain individuals claiming state power/authority have a privileged right to violate anyone of their choosing, especially children, with instruments and chemicals, “vaccines” and whatnot. As if somehow, magically, “public health” will not be corrupted by regulatory capture or bad science. What would stop her state from being final arbiter/definer in all contracts?
      Classical liberals always seem to have Thermidorean Reaction built right in to their ideology.

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

    Another thing: McCloskey tries to do a bit
    of know-it-all sneering by writing “It [the veil of ignorance] was
    articulated first in 1962 by James Buchanan and Gordon Tullock and
    popularized by Rawls”. Well if you’re going to do that de-haut-en-bas
    thing you’ve got to get your facts right. Buchanan and Tullock (and
    Rawls) got the idea from Harsanyi.

    • Deirdre McCloskey

      Dear Mr. Bertram, One can’t say everything (I try!) You’re right, but I acknowledged Harsanyi’s precedence in the matter as long ago as 1985, in The Applied Theory of Price.
      Deirdre McCloskey