Arnold Kling  

The Case for Planning

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We Don't Need No... Your Planners at Work...

James K. Galbraith writes,


The job of discipline belongs to governments. And they must act not only on behalf of today's citizens but of all those yet to come - of those who need clean food and water, of those who need safe cars, appliances and workplaces, and of those will be around the low countries when the ice caps melt. Dealing with problems means thinking ahead, from an independent, forward-looking point of view. This is called planning. It means providing stable, predictable rules for the private sector. This is called setting standards.

...I have never accepted that the United States fits the mold of a "free market economy." If we ever did, that model collapsed in the Great Depression. What was built in its place was a remarkable mix of public and private. There was, of course, plenty of room for enterprise. But it came in a framework, of a government that was, at its best, competently concerned with research, infrastructure, national security, the workplace and the environment, that provided Social Security and a large share of education, health care and housing. Part of the accidental genius of the system was that the public-private mix in those three areas, especially, created "soft budget constraints" that caused higher education, the medical sector and the mortgage market to grow very large - far larger than they ever could have, under either the free market taken alone or under socialism. While many notorious problems remained (especially our lack of universal health insurance), this enriched the middle class and was an immense source of growth.

I don't mind giving him a shot at his planned utopia. Just leave me out of it.

I am willing to let the planners have Europe. I wish that America, or some state within it, could be free to live without the planners. See this old essay.


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CATEGORIES: Political Economy



COMMENTS (12 to date)
liberty writes:

It is interesting how he keeps saying that we need to get other countries to fund us in our adventures. I think he must subscribe to the dependency theory of development. His planning + protectionism + dependency theory puts him square in the target zone of Brian Lindsey's book.

It is hard to know where to begin with guys like him - it is like we speak different languages.

liberty writes:

Excuse me, Brink Lindsey. Excellent book, by the way.

kevindwhite writes:

(I have not yet read the book)

Where do politicians get the incentive to plan beyond their next election?

shayne writes:

To: kevindwhite,
Excellent question, but Galbraith is referring to Emperors (all-powerful and all-seeing), not politicians. As an aside, I have no intention of reading his book. I read the article (linked to above by Arnold) and received from it my full quota of mis-information for calendar year 2008 and beyond.

I do find it remarkable that allegedly intelligent, well educated people (Galbraith and most of his commenter's) still embrace and propose such central-planning nonsense so soon after the Soviet Union voted itself out of existence - for cause. I almost wish their ideal state could be implemented in the U.S. After its inevitable failure - just as in Eastern Europe and elsewhere - perhaps the entire notion of the magnificence of central planning could be permanently rejected. But then again, probably not. Beside which, it's easier to watch the contemporary successes of China and the like as they transition to market-based systems and the failures of the likes of Argentina and Venezuela as they attempt to implement Galbraith's ideal - observing from within the U.S.

mjh writes:

I suspect that I wouldn't want to live in a country like what Galbraith seems to want, I agree with AK: let him try it. Perhaps there is something that this batch of central planners can get right that the previous batch got wrong. And if they do get it right, then more power to them.

Of course, I'm assuming that citizens would be free to move in and out of whatever country they want to live in. If they want to live in the central planned country and it works better for them, great. If they'd rather live in the capitalist country, no problem. What I suspect would happen is that the central planned countries would lose population and eventually cease to exist.

But I don't know. What I like about capitalism the freedom that it affords to try things - things that up front look like they'll fail. For example, 30 years ago, who could have predicted a company like google? They offer a comprehensive search of an enormous amount of data and they offer it to their users free of charge!

Well I take that approach with Galbraith. Let him have his planned country. Maybe he's got something that I'm not smart enough to anticipate. I don't expect to live there. But if he does have something that's really great, then I may find myself changing my mind in the future.

ivan writes:

"just leave me out of it"

That, of course, is not possible. How can the government perform the job of discipline if everyone wants to stay out?

And disciplining what? The private sector probably and the market. The people in other words. On behalve of themselves. Big Brother.

Frigthening and quite depressing. Take global warming. First, the government subsidizes big energy-intensive corporations and transport especially long-distance transport so that we put more carbon dioxide in the air than seems to be good for us. So government creates "the new industrial state", hailed by James father, that is now destroying our climate. And then second that same government must discipline the private sector and today's citizens into proper behaviour. For their own good of course. From the new industrial state to the new autharian state.

Is there anyone who does not want to opt out?

larry writes:

I agree with the commenters above that the planners who will run the country (and all the other big countries as well) will never just leave you out of it. They know they cannot let anyone opt out. If they did, the most productive people would immediately opt out. Then more and more productive people would opt out.

Under the Clinton healthcare plan in 1993 it would have been a crime to get private health care, outside the national system, as it is in most of Canada today. Opt-outs are not beloved by the central planners.

Dr. T writes:

If these are examples of how he thinks, then it appears to me that all his academic positions, chairmanships, panels, etc. were gained by riding his father's coattails. I don't see how anyone can take him seriously.

liberty writes:

Dr. T,
And what is the excuse for listening to his father?

Snark writes:
And what is the excuse for listening to his father?

To recognize the subtle danger of an imprecise gospel.

Todd Kuipers writes:

I agree heartily with Kling on this one (not that I don't most of the time anyway). Galbraith literally holds to a bizarre logic where he hopes that education will improve so that more people will understand so that they will change their utility yardstick so that the government will become more rigorous so that the star chambers that are subsequently created will hopefully be better than the reasonably simple alternative. Truly bizarre. He is the new prophet of the idea that markets/capitalism are second-best - if only we can figure what is and how to implement the best.

R. Richard Schweitzer writes:

Why is it that there is this continuous reification of "government?"

Governments are simply mechanisms operated by humans, each with limited information and limited intelligence with which to turn that information into knowledge.

Think of a government, say, Cambridge,MA., staffed and administered by a dozen Galbraiths; what would they have?

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