Occupy Wall Street – Bleeding Heart Libertarians http://bleedingheartlibertarians.com Free Markets and Social Justice Fri, 19 Jan 2018 15:05:02 +0000 en-US hourly 1 https://wordpress.org/?v=4.9.2 http://bleedingheartlibertarians.com/wp-content/uploads/2016/09/cropped-site-icon-BHL-32x32.png Occupy Wall Street – Bleeding Heart Libertarians http://bleedingheartlibertarians.com 32 32 22756168 Occupy the Mind — Nozick Edition. It ain’t ideology, it’s institutional analysis http://bleedingheartlibertarians.com/2012/04/occupy-the-mind-nozick-edition-it-aint-ideology-its-institutional-analysis/ http://bleedingheartlibertarians.com/2012/04/occupy-the-mind-nozick-edition-it-aint-ideology-its-institutional-analysis/#comments Tue, 10 Apr 2012 14:05:49 +0000 http://bleedingheartlibertarians.com/?p=2487 On p. 272 of Anarchy, State and Utopia, Nozick writes the following: Economically well-off persons desire greater political power, in a nonminimal state, because they can sue this power to...

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On p. 272 of Anarchy, State and Utopia, Nozick writes the following:

Economically well-off persons desire greater political power, in a nonminimal state, because they can sue this power to give themselves differential economic benefits.  Where a locus of such power exists, it is not surprising that people attempt to use it for their own ends.  The illegitimate use of a state by economic interests for their own ends is based upon a preexisting illegitimate power of the state to enrich some persons at the expense of others.  Eliminate that illegitimate power of giving differential economic benefits and you eliminate or drastically restrict the motive for wanting political influence.  True, some persons will thirst for political power, finding intrinsic satisfaction in dominating others.  The minimal state best reduces the chances of such takeover or manipulation of the state by persons desiring power or economic benefits, especially if combined with a reasonably alert citizenry, since it is the minimally desirable target for such takeover or manipulation.  Nothing much is to be gained by doing so; and the cost to the citizens if it occurs is minimized.  To strengthen the state and extend the range of its functions as a way of preventing it from being used by some portions of the populace makes it a more valuable prize and a more alluring target for corrupting by anyone able to offer an officeholder something desirable; it is, to put it gently, a poor strategy.

What does this say about the outrage that has been expressed about the bailouts directed at Wall Street?  What does this say about questions about the scale and scope of state activity in general? How does it impact the way one must think through the BHL project?

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He Had Moves Like Jagger http://bleedingheartlibertarians.com/2012/02/he-had-moves-like-jagger/ http://bleedingheartlibertarians.com/2012/02/he-had-moves-like-jagger/#comments Fri, 24 Feb 2012 00:55:31 +0000 http://bleedingheartlibertarians.com/?p=2164 While flying yesterday, I began a set of readings for a Liberty Fund conference on Bastiat (thanks Matt!).  I haven’t read Bastiat in a serious way since grad school.  My...

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While flying yesterday, I began a set of readings for a Liberty Fund conference on Bastiat (thanks Matt!).  I haven’t read Bastiat in a serious way since grad school.  My reaction to the first set of readings recalls the (perhaps apocryphal) story of when Eric Clapton first heard Jimi Hendrix play.  Supposedly Clapton said “that’s it, I have to go home and burn all my guitars.”  Or in a more recent cultural reference:  “I am not worthy!”  I mean that literally, in that I was recently mentioned in a conversation about modern-day Bastiats.  I thought that was excessive flattery at the time, but after this morning, I really am not worthy.

Even after more than 150 years, I’m not sure any economist has ever combined really good economic content with the style, panache, and passion of Bastiat.  There are so many examples even in the limited reading I did, but one stood out from the first chapter of Economic Harmonies from 1850.  The long extracts below could have been written today about Occupy Wall Street and related issues, but no one has done it with quite the style and clarity of analysis that Bastiat brings.  I’ll insert some commentary along the way.

But now the great masses of the people, downtrodden, oppressed, exhausted,  stage their revolution too…They become a pressure group;  they [like those they oppose] insist on becoming privileged.  They, the masses of the people, imitating the upper classes, cry in their turn for privileges.  They demand their right to employment, their right to credit, their right to education, their right to pensions.  But at whose expense?  That is a question they never stop to ask.  They know only that being assured of employment, credit, education, security for their old age, would be very pleasant indeed, and no one would deny it.  But is it possible?  Alas, no, and at this point, I say, it is no longer detestable, but illogical to the highest degree.

All fair enough, then Bastiat appeals directly to them.

Privileges for the masses!  People of the lower classes, think of the vicious circle you are placing yourself in.  Privilege implies someone to profit from it and someone to pay for it.  We  can conceive of a privileged man or privileged class;  but we can we conceive of a whole nation of privileged people?  Is there another social stratum under you that you can make carry the load?

Note the argument that it’s the richer classes who use privileges from the state to exploit those below them, rather than the other way around. There’s something of a libertarian class theory there.

Will you never understand the weird hocus pocus of which you are the dupes?  Will you never understand that the state cannot give you something with one hand without taking that something, and a little more, away from you with the other?  Do you not see that, far from there being any possible increase of well-being in this process for you, its end result is bound to be an arbitrary government, more galling, more meddling, more extravagant, more precarious, with heavier taxes, more frequent injustices, more shocking cases of favoritism, less liberty, more lost  effort, with interests, labor, and capital all misdirected, greed stimulated, discontent fomented, and individual interest stifled?

This is a classic imminent sort of criticism, suggesting that the means of the poor’s desire for privilege (the state) will frustrate their ends and give them more of exactly what they oppose.  Bastiat’s argument is a fine one against OWS today.  As good as this is, Bastiat recognizes that he might be letting other parties off the hook.

The upper classes become alarmed, and not without reason, at this disturbing attitude on the part of the masses.   They sense in it the germ of constant revolution, for what government can endure when it has had the misfortune to say:  “I have the force, and I shall use it to make everybody live at the expense of everybody else.  I take upon myself the responsibility for the happiness of all?”

Now he goes in for the kill:

But is not the consternation these classes feel a just punishment?  Have they themselves not set the baneful example of the attitude of mind of which they now complain?  Have they not always had their eyes fixed on favors from the state?  Have they ever failed to bestow any privilege, great or small, on industry, banking, mining, landed property, the arts, and even their means of relaxation and amusement, like dancing and music – everything, indeed, except on the toil of the people and the work of their hands?  Have they not endlessly multiplied public services in order to increase, at the people’s expense, their means of livelihood:  and is there today the father of a family among them who is not taking steps to assure his son a government job?  Have they ever voluntarily taken a single step to correct the admitted inequities of taxation?  Have they not for a long time exploited their electoral privileges?  And now they are amazed and distressed that the people follow in the same direction!  But when the spirit of mendicancy has prevailed for so long among the rich, how can we expect it not to have penetrated to the less privileged classes?

KA-BLAM!  Bastiat was a rhetorical ninja right there.

It’s is a terrific substantive and rhetorical point that I think has largely been overlooked in the contemporary libertarian commentary on Occupy Wall Street, yet Bastiat had it 160 years ago, and with style and panache.  Bastiat may not have made any real contributions to economic theory, but no one in the history of economics has been a better economic rhetorician than he was.  He knew how to take ideas and put them in a form that was persuasive and memorable.  It is a skill more economists could use as we continue to try to push back during a time when bad ideas we thought were dead are reappearing, zombie-like, across the landscape.

Oh for some contemporary Bastiats, for I am not worthy.

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The Morality of Occupying Private Property http://bleedingheartlibertarians.com/2011/12/the-morality-of-occupying-private-property/ http://bleedingheartlibertarians.com/2011/12/the-morality-of-occupying-private-property/#comments Wed, 21 Dec 2011 13:31:21 +0000 http://bleedingheartlibertarians.com/?p=1626 So as the Occupy movement switches tactics to occupy foreclosed homes, I pose the following questions for my colleagues here at BHL and the commentariat: 1. Given that many of...

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So as the Occupy movement switches tactics to occupy foreclosed homes, I pose the following questions for my colleagues here at BHL and the commentariat:

1. Given that many of those homes are the property of the very same banks who were bailed out with their/our tax dollars, is there any reason to object to Occupiers simply reclaiming property that we could argue, with some strong moral force, actually belongs to “them/us” anyway?

2. And given the questionable legality of the foreclosure tactics banks have used, isn’t there a legitimate question of whether those homes really belong to the banks?

In answering, one might think about Rothbardian and Nozickean theories of just transfer, Hernando de Soto’s work, and the Ragnar character from Atlas Shrugged. The tensions between deontological and consequentialist approaches are very fascinating here too.

I posed this on Facebook recently and a long and interesting discussion ensued and I was curious what the BHL crowd would say.

Finally, I don’t have a clear answer to either question myself, but I don’t think it’s clear and obvious that these attempts to occupy foreclosed houses are wrong on libertarian grounds.

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Ron Paul: “Read The Law, by Bastiat” http://bleedingheartlibertarians.com/2011/12/ron-paul-read-the-law-by-bastiat/ http://bleedingheartlibertarians.com/2011/12/ron-paul-read-the-law-by-bastiat/#comments Tue, 06 Dec 2011 20:29:34 +0000 http://bleedingheartlibertarians.com/?p=1580 This past weekend at the Huckabee Presidential Candidate Forum, Ron Paul was asked what one book he would suggest every American read.  His answer was that they should read The...

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Frederic BastiatThis past weekend at the Huckabee Presidential Candidate Forum, Ron Paul was asked what one book he would suggest every American read.  His answer was that they should read The Law, by Frédéric Bastiat.  (Video here, at about 10:40)

This was a great answer, and I heartily second Paul’s endorsement.  If you haven’t read it yet, you should.  Though Bastiat was a French economist writing in the early 19th century, his prose is still highly readable and extremely relevant.  And The Law is widely available free online: HTML, Kindle, audio, and PDF versions can all be found on this page.  (Those of you looking to go even deeper into Bastiat’s thought can find an immense wealth of resources at David Hart’s incredible website here)

The Law is about what legal systems should be, and how they have been perverted.  The true purpose of the law, according to Bastiat, is the “collective organization of the individual right to lawful defense” of the natural rights of life, liberty, and property.  But, unfortunately,

The law has been used to destroy its own objective: It has been applied to annihilating the justice that it was supposed to maintain; to limiting and destroying rights which its real purpose was to respect. The law has placed the collective force at the disposal of the unscrupulous who wish, without risk, to exploit the person, liberty, and property of others.

Instead of protecting our rights, the law has turned to plundering them.  The main causes of this plunder, in Bastiat’s eyes, are two: “stupid greed and false philanthropy.”

Bastiat’s discussion of the role of greed in promoting plunder is especially relevant today, given ongoing concerns about corporatism and its relation to capitalism as expressed by both libertarians and certain segments of the Occupy Wall Street movement.  Bastiat presents a clear and simple diagnosis of the root cause of corporatist plunder:

When they can, they wish to live and prosper at the expense of others … Man can live and satisfy his wants only by ceaseless labor; by the ceaseless application of his faculties to natural resources. This process is the origin of property. But it is also true that a man may live and satisfy his wants by seizing and consuming the products of the labor of others. This process is the origin of plunder. Now since man is naturally inclined to avoid pain—and since labor is pain in itself—it follows that men will resort to plunder whenever plunder is easier than work. History shows this quite clearly. And under these conditions, neither religion nor morality can stop it.

How can we identify and stop plunder?

Quite simply. See if the law takes from some persons what belongs to them, and gives it to other persons to whom it does not belong. See if the law benefits one citizen at the expense of another by doing what the citizen himself cannot do without committing a crime. Then abolish this law without delay, for it is not only an evil itself, but also it is a fertile source for further evils because it invites reprisals. If such a law—which may be an isolated case—is not abolished immediately, it will spread, multiply, and develop into a system.

And in Bastiat’s time, he saw that plunder had developed into a system, where any merchant, guild, or special interest with the resources to do so would struggle to gain influence or control over the coercive power of the state in order to twist it to serve its own private ends.  The result: a system of universal plunder sustained by the “delusion” that the the law can be made to “enrich everyone at the expense of everyone else.”

Not all plunder, however, has its origins in nefarious motives.  Some has its origins in a genuine desire to help the less fortunate.  And Bastiat was one who believed that charitable aid to the poor was an important virtue.  But the purpose of the law is justice, not charity.  And to use the law to achieve charitable ends inevitably perverts justice.

You say: “There are persons who have no money,” and you turn to the law. But the law is not a breast that fills itself with milk. Nor are the lacteal veins of the law supplied with milk from a source outside the society. Nothing can enter the public treasury for the benefit of one citizen or one class unless other citizens and other classes have been forced to send it in.

Such a view might appear cold-hearted – suggesting that the needs of the poor are of so little moral weight that they cannot justify even the most trivial infringement on the liberties of the well-off.  Does Bastiat think that society has no obligation to the least well-off?  No.  This charge, says Bastiat

confuses the distinction between government and society. As a result of this, every time we object to a thing being done by government, the socialists conclude that we object to its being done at all. We disapprove of state education. Then the socialists say that we are opposed to any education. We object to a state religion. Then the socialists say that we want no religion at all. We object to a state-enforced equality. Then they say that we are against equality. And so on, and so on. It is as if the socialists were to accuse us of not wanting persons to eat because we do not want the state to raise grain.

Bleeding Heart Libertarians like myself might take issue with some of Bastiat’s claims about the defensibility of social justice and the exact nature of a state’s obligations toward the poor.  But even if you don’t agree with him 100%, you’re sure to find much in The Law to enjoy, ponder over, and admire.

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Dear Left: Corporatism Is Your Fault http://bleedingheartlibertarians.com/2011/11/dear-left-corporatism-is-your-fault/ http://bleedingheartlibertarians.com/2011/11/dear-left-corporatism-is-your-fault/#comments Tue, 29 Nov 2011 16:24:15 +0000 http://bleedingheartlibertarians.com/?p=1560 I’m not usually one for polemics. But sometimes polemics is called for. Here goes. Dear members of the moderate left, America is suffering from rampant, run-away corporatism and crony capitalism....

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I’m not usually one for polemics. But sometimes polemics is called for. Here goes.

Dear members of the moderate left,

America is suffering from rampant, run-away corporatism and crony capitalism. We are increasingly a plutocracy in which government serves the interests of elite financiers and CEOs at the expense of everyone else.

You know this and you complain loudly about it. But the problem is your fault. You caused this state of affairs. Stop it.

Unlike we libertarianish people, you people actually hold and have been holding significant political power in the US over the past 50 years. What have you done with this power? You’ve greased the corporatist machine every chance you’ve gotten. You’ve made things worse, not better. Our current problems are your fault. You need to stop.

We told you this would happen, but you wouldn’t listen. You complain, rightly, that regulatory agencies are controlled by the very corporations they are supposed to constrain. Well, yeah, we told you that would happen. When you create power—and you people love to create power—the unscrupulous seek to capture that power for their personal benefit. Time and time again, they succeed. We told you that would happen, and we gave you an accurate account of how it would happen.

You complain, perhaps rightly, that corporations are just too big. Well, yeah, we told you that would happen. When you create complicated tax codes, complicated regulatory regimes, and complicated licensing rules, these regulations naturally select for larger and larger corporations. We told you that would happen. Of course, these increasingly large corporations then capture these rules, codes, and regulations to disadvantage their competitors and exploit the rest of us. We told you that would happen.

It’s not rocket science. It’s public choice economics. You recognized, rightly, that public choice economics was a threat to your ideology. So, you didn’t listen, because you didn’t want to be wrong. Public choice predicted that the government programs you created with the goal of fixing problems would often instead exacerbate those problems. Well, the evidence is in. You were wrong and public choice theory was right. If you have any decency, it is time to admit you were wrong and change. Stop making things worse.

You spent the past fifty years empowering corporations and the most unscrupulous of the rich. You created rampant moral hazard in the financial sector. You created the system that socializes risks but privatizes profit. You created the system that creates a revolving door between Obama’s staff and Goldman Sachs. There’s a reason why Wall Street throws money at Obama. It’s because you, the moderate left, are Wall Street’s biggest supporters. Oh, I know you complain about Wall Street. But your actions speak louder than your words.

You balk: Isn’t the problem the regressive pro-market post-Reagan politics? Please, people. Let’s be serious a moment. Reagan used a bunch of pro-market, pro-liberty, anti-big government rhetoric, but the man was no libertarian, and he did little to make the country more libertarian. Reagan spent and spent, and thus ran up the debt. He doubled the number of imports with trade restrictions. He pursued militaristic foreign policy. He increased rather than decreased the size, scope, and power of government. Reagan ramped up the war on Americans civil liberties drugs. He wasn’t even a big deregulator—that was Carter. Look past rhetoric to reality. Reagan was in practice just a more militaristic version of one of you. (More militaristic? Maybe I’m giving you too much credit. While we spent Black Friday shopping, Obama spent it having his military murder innocent Afghan children.)

Point your fingers at yourself. You did this.

Now, here’s the good news. Unlike we libertarianish people, you members of the moderate left will continue to hold and exercise power. So, learn some public choice, and use what you learn in practice. I’m ready to forgive you, if you’re ready to change.

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Does Inequality Matter? http://bleedingheartlibertarians.com/2011/10/does-inequality-matter-2/ http://bleedingheartlibertarians.com/2011/10/does-inequality-matter-2/#comments Mon, 31 Oct 2011 18:49:56 +0000 http://bleedingheartlibertarians.com/?p=1428 A common theme among the Occupy Wall Street crowd and its supporters is that inequality in the United States has skyrocketed over the last thirty years.  Often, statistics about increasing inequality – and income...

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A common theme among the Occupy Wall Street crowd and its supporters is that inequality in the United States has skyrocketed over the last thirty years.  Often, statistics about increasing inequality – and income inequality in particular – are put forward as examples of self-evident injustice.  In this post, I want to suggest that things are not this straightforward.  Recognizing that much more could be said about each of these points, here are a few thoughts to bear in mind when thinking about the relationship between inequality and social justice.

  • There is very little reason to think that inequality of outcome is necessarily unjust.
    • Sergey Brin makes more money than I can ever hope to make.  Is this unjust?  I don’t think so.  He made his money by making the world a much, much better place than he found it.  Ken Lay’s wealth was a very different story.  In general, whether inequality is unjust seems to depend on how the inequality came about, not just (not at all?) on the absolute magnitude of the inequality.
    • My sense is that the position I express here is a non-idiosyncratic – perhaps even the dominant – position among political philosophers.  For example, very few philosophers today are simple egalitarians.  Many more are luck egalitarians.  But luck egalitarianism is distinguished from simple egalitarianism just by holding that inequality of outcome is not per se morally objectionable – only inequality that is the product of brute luck is.

  • Often when we think inequality of outcome is bad, it is because we are confusing inequality with insufficiency – we are confusing having less than someone else with not having enough for a decent life.
    • Would income or wealth inequality be troubling in a society of people who all had the purchasing power of billionaires?
      • (Aside: isn’t this exactly how the United States looks to most of the rest of the world today?)

 

  • Even if inequality of outcome as bad, there’s no good reason to think that income inequality is the right way to measure it.  Why not inequality of wealth?  Or inequality of consumption?  Or happiness?
    • After all, if income matters morally, isn’t it because of the way it contributes to our overall wealth?  Is there anything morally objectionable about a society in which very wealthy people have very low incomes?
    • Even wealth, though, is just a means to an end.  If wealth matters, it’s because of what it can buy us.  And if Aristotle was right, then what we can buy matters only insofar as it contributes to our happiness.  So isn’t happiness inequality what really ought to trouble us.
    • While income inequality has arguably increased dramatically over the last thirty or so years, however, inequality of consumption and happiness have not.
      • (Aside: Some people think relative wealth makes a bigger difference in people’s happiness than absolute wealth.  Does the relatively flat trend of happiness inequality combined with the relatively steep increase in income inequality tend to undermine this claim?)

 

  • Even if income inequality does matter, it’s not clear that we are measuring it correctly.
    • I’m no economist, but the message I get from listening to them is that a lot depends on the details – whether we’re measuring income before taxes and transfer payments, or afterwards.  Whether we’re tracking households or individuals.  Or whether we’re correctly adjusting for inflation.

 

  • Even if income inequality matters, and even if we’re measuring it correctly, none of this is relevant unless we take into account economic mobility.
    • Here’s a scary-looking fact: between 1975 and 1997 the wealthiest 20% went from receiving 43.2% of the national income to receiving 49.4% of it.  The bottom 20%, in contrast, went from receiving 4.4% to receiving 3.6% (US Treasury Dept., via Steve Horwitz)
    • But this is much less scary once you recognize that the people who constituted the bottom 20% in 1975 are by and large not the same people who constituted it in 1997.  In fact, most of the people who were in the bottom quintile in 1975 had moved out of it by 1997.
    • (It’s even less scary when you take into account economic growth.  4.4% of the total national income in 1975 is probably a much smaller figure than 3.6% of the total national income in 1997.)
    • For more on mobility and economic growth, take a look at Steve Horwitz’s excellent short video here.

None of this is to suggest that the OWS crowd is wrong in thinking that there are serious injustices in our political/economic system.  And it’s certainly not meant to cast doubt on the claim that much of the inequality that we actually find in the United States is the product of injustice – of processes that would be identified as unjust, moreover, but almost any political theory, libertarian, Rawlsian, socialist, or otherwise.  But there’s a sense among the OWS protesters (though it’s common among protesters for other social causes as well) that the nature and existence of the injustice they seek to eliminate is obvious.  An apparent corollary of this belief is that those who disagree with their prescriptions are stupid or evil.  And that all that’s required to make positive change is to develop the willpower to do what we already know is right.

Maybe it’s the philosopher in me, but this kind of attitude always rubs me the wrong way.  Things are rarely so simple.  Here, as in so many other involving complex social issues, there is room for reasonable people to disagree not merely about what ought to be done to correct injustice, but about what really ought to count as an injustice in the first place.

 

UPDATE: My original post failed to include a link to Will Wilkinson excellent Policy Analysis report on Inequality.  Wilkinson actually makes many of the same points I do, though with much more supporting detail and evidence.  My only excuse for omitting the link is that I read it so long ago and found it so compelling that the arguments just slipped into the background of my mind in the set of “things that are clearly true.”

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