Deirdre McCloskey – Bleeding Heart Libertarians Free Markets and Social Justice Wed, 15 Nov 2017 17:16:21 +0000 en-US hourly 1 Deirdre McCloskey – Bleeding Heart Libertarians 32 32 22756168 Factual Free-Market Fairness Sat, 16 Jun 2012 16:39:57 +0000 [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,...

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[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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Giving a Damn: The Missing Ethics in Political Philosophy Mon, 11 Jun 2012 13:52:04 +0000 [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 post Giving a Damn: The Missing Ethics in Political Philosophy appeared first on Bleeding Heart Libertarians.

[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.]

In a seaside hotel in the Bahamas in spring of 2011 I was chatting with a man I did not know at a convention of 250 or so libertarians.  I remarked in what I thought was a conciliatory tone, and by way of an ethical grounding for our shared libertarianism, and for most other political views, “Well, we all want to help the poor.”  He shot back instantly, “Only if they help me.”

That about sums up the problem that John Tomasi is trying to solve—how to bring along right-libertarian liberals, the fatherly sort like my acquaintance in the Bahamas, and the High Liberals, the motherly sort whom John and I enjoy so much as beloved if politically somewhat predictable colleagues in the Department of Political Science or the Department of English.  Keeping the academic peace is the least of it.  The two sides of the liberal tradition since Locke by now think of each other as idiots.  John says to them: “Neither of you-all are idiots.  Let’s get back to the core liberal conviction, which you share, that ‘society is a cooperative venture for mutual gain between citizens concerned to honor the freedom and equality of one another’ (p. 172).”

John wants especially to test his promising notion of “free market fairness” on deep ethical grounds.  The “level of political philosophy” that he identifies focuses “more on the quality of the regime’s moral intentions (with questions about the practical likelihood. . . being bracketed)” (p. 173).  “By political philosophy,” he explains, “I mean a level of purely moral discourse about political questions” (p. 119).  He is delighted to challenge the High Liberal Rawlsians on their home ground in political philosophy, that is, on “a single dimension of evaluation: the moral dimension” (p. 205).  “Market democracy combines insights from the classical and liberal traditions at the level of moral foundations” (p. 95, his italics).  And so throughout.

I warmly welcome the ambition to moralize our political lives and theories.  Indeed, that is the point of one of my books, The Bourgeois Virtues: Ethics for an Age of Commerce (2006), which argued that a bourgeois life by no means requires the abandonment of ethics.  Rather the contrary.  We right liberals, as John notes, have too often accepted the supposition of the High Liberals that they are ethically elevated (“Help the poor”), while we have on our side only vulgar practicalities (“Maximize income”).  John wants to take back ethics for a society of markets and innovation and growth, which is my project, too.  He and I, with other right liberals like David Schmidtz and Gerald Gaus at the University of Arizona, where John studied, always puzzle and sometimes outrage our leftish colleagues by claiming that one can be ethical and want to help the poor and yet also think that the minimum wage is almost as bad an idea as the War on Drugs.  We market liberals are so graceless as to be unwilling to concede the ethical superiority of High Liberals such as Ronald Dworkin or Martha Nussbaum.  Martha wrote a generous blurb for my 2006 book, but called the book “maddening”: yes, it makes people mad to hear that people they dismissed as idiots have a few thoughts, such as that a market economy can be ethical.

So, by all means, let’s base political philosophy on ethics.  The trouble is that John, though he is I assure you a highly ethical man, hasn’t got an ethical theory worthy of the name.  To the extent a theory can be discerned in a highly theoretical book, he takes his stand with Kant: “market democracy takes a more Kantian approach” (p. 98).  Just as the High Liberals stand with Rousseau and natural-rights libertarians with Locke and classical/Millian liberals with Bentham, the market democrat, John seems to be saying, stand with the maxims of the Sage of Köningsberg.

Well, not exactly.  Nowhere are Kant’s loony conclusions from the Categorical Imperative mentioned, for example, or the rest of the details of his Only-Justice theory.  John is a Kantian merely in the sense that he admires Kant’s at least theoretical devotion to human dignity above all.  The word “dignity” is I think a crux, both in John’s book and in the history of West (for which see the very wise discussion in Bourgeois Dignity: Why Economics Can’t Explain the Modern World [2010]).  But I don’t think it has much to do with Kant specifically.  It has rather to do with the shift around 1700 in northwestern Europe towards notions of liberty and dignity for ordinary people, including merchants and inventors and eventually even the rest of hoi polloi.  In the West’s case, treating ordinary people as ends rather than means made for economic growth and political democracy and all our joy.  In John’s case the emphasis on the dignity of ordinary people constructs an ethical bridge between the High Liberals and the classical liberals/libertarians, requiring the one to admit that without paid work, and the other to admit that without income, no one can be dignified, a “responsible self-author,” as John puts it.

Understand what I’m saying.  John makes many good ethical points, the best being that self-authorship—the startling notion new in 1700 that even poor people should have the scope to flourish, and that pie in the sky when you die does not suffice—involves economic liberty.  Careless interventions such as the High Liberals routinely defend as “designed” to help the poor, such as that same minimum wage, throw away the economic liberty that John and I want to make equal in salience to other liberties: not trumps (as the Lockean libertarians would have it) but a serious card in play.  Most people are not much interested in the sorts of liberties that intellectuals dote on, such as a free press.  But they are very interested in being able to start a new business or to go to another job or to be proud of putting their kids through college, which is exactly what the High Liberal so casually want to take from them and give over to experts.  Tzvetan Todorov quotes the protagonist of Forever Flowing, the posthumously published novel of Vasily Grossman (1905-1964), whom he says was the sole example of a successful Stalinist writer who converted wholly to anti-Communism (“The slave in him died, and a free man arose”):

I used to think freedom was freedom of speech, freedom of the press, freedom of conscience.  Here is what it amounts to: you have to have the right to sow what you wish to, to make shoes or coats, to bake into bread the flour ground from the grain you have sown, and to sell it or not sell it as you wish; for the lathe-operator, the steelworker, and the artist it’s a matter of being able to live as you wish and work as you wish and not as they order you (Todorov,  Hope and Memory, 2000, p. 69f, p. 48).

And John cleverly, and correctly, convicts Hayek (p. 136) and, good Lord, Ayn Rand (p. 135f) of basing their arguments on helping the poor, that is, the “social justice” they so proudly spurn: “Social justice, we might say, gives the [Hayekian, not Lyndon Johnsonian] Great Society its [ethical] point” (p. 160).  So I’m not saying that John misses all the ethical points.  I’m saying that he has no ethical theory.

But he is by no means alone in this.  All modern political theory since Hobbes, the part covered for example in the second volume of Alan Ryan’s brilliant New Sabine, On Politics, lacks a sensible ethical grounding.  It’s no wonder, since the moderns gave up (1.) religion and (2.) virtue ethics, and it’s hard to imagine a sensible ethical grounding without one or both of these.  Martha Nussbaum’s Frontiers of Justice: Disability, Nationality, Species Membership (2006) is a case in point.  It attempts eloquently to add the love of others to the few accepted ethical axioms of political philosophy.  She criticizes on this count the strictly Hobbesian/ Gauthieresque contractarian’s assumption of Prudence Only; or the Lockean/ Rawlsian contractarian’s Prudence-With-A-Version-of-Justice.  In a bumper-sticker version of a complicated project, Nussbaum’s book is about love-adding, bringing in our care for others from the start.

She puts forward:

The Nussbaum Lemma

I think it implausible [she writes] to suppose that one can extract justice from a starting point that does not include it in some form, and I believe that the purely prudential starting point is likely to lead in a direction that is simply different from the direction we would take if we focused on ethical norms from the start (p. 57).

The Lemma is devastating to the project since Hobbes in 1651 of pulling a just rabbit out of a purely prudential hat.  You can’t get virtue J, Justice, from a starting point consisting only of virtue P, Prudence.  Virtue J has to be in from the start.  You have to put the rabbits into the hat if you are going to pull them out.

But the Nussbaum Lemma applies also to her own project in her own book, and now also to John’s.  You can’t stop with prudence, justice, and love of others. It is implausible to suppose that one can extract faith, temperance, hope, courage, the fullness of love—which is connection, including connection with nature or science, or God, or the poor—which are the other virtues beyond Prudence and Justice that make for human flourishing—from a starting point that does not, in Nussbaum’s words, “include them in some form.”  And it seems likely that attempting to do so will lead in a direction that is simply different from the direction we would take if we focused on ethical norms from the start.

What of it?  This: political and economic philosophy needs to be done with all seven of the virtues, not merely with some cleverly axiomatized sub-set.  To characterize people with one or another of the boy’s-own “models” said since 1651 to suffice for theories of justice or politics will not do.

What is required for any political ethics, in other words, is a conscientious moral agent, a virtuous person.  Virtuous: namely, having the seven virtues in some idiosyncratic combination. Kant himself said so.  In his Reflections on Anthropology he praised “the man who goes to the root of things,” and who looks at them “not just from his own point of view but from that of the community,” which is to say (wrote Kant), der Unpartheyische Zuschauer.  The phrase is precisely the contemporary translation of Adam Smith’s ideal character from whom at least the artificial virtues are said to flow, the Impartial Spectator.  Adam Smith’s system in The Theory of Moral Sentiments was the last major statement of virtue ethics before its recent revival in departments of philosophy and especially among female philosophers.  In Part VI of the Theory, added in 1790, he reduced good behavior to five of the seven virtues: prudence, justice, love (“benevolence”), courage (“fortitude”), and temperance (the last two being “self-command”) (Smith 1759/90, p. 236).  Hope and faith and transcendent love are absent, as monkish, but the ideal bourgeois he praises in the early pages of Part VI slips them in anyway, secularly, as Smith did in his own life.

By admitting that der Unpartheyische Zuschauer begins his system, Kant undermines it, since the impartial spectator is not derivable from maxims justified merely on grounds of pure or practical reason.  Kant’s system is supposed to ground everything in maxims that a rational being would necessarily follow.  It doesn’t.  What Peter Berkowitz said about Kant’s political philosophy could also be said of his ethical philosophy, that he “makes practical concessions to virtue and devises stratagems by which virtue, having been formally expelled from politics, is brought back in through the side door” (Berkowitz 1999).

That is, ethics, even the political ethics we call political theory, must start from an ethical person imagined as The Ethicist or The Political Theorist—who turns out to have all seven of the Western virtues.  The rabbits are already in the hat. Think of how impossible it would be to come to the conclusions of Kantian or utilitarian or Sen-Nussbaum or Buchanan-Tullock or Tomasi-Gaus political ethics if The Ethicist or The Theorist did not already have the character Rachels praises of concern, impartiality, carefulness, humility, courage, and so forth.

Frankly, my dear, he wouldn’t give a damn.


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