Bryan Caplan  

Ayn Rand Villains Walk the Earth!

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Last night I was part of a John Stossel panel of bailout/stimulus critics.  It's supposed to air a week from Friday; you'll definitely see my face, but whether you'll hear my voice is up to the editor.

During the session, I occasionally thought that other panelists were over-stating the sinister intentions of the Obama team.  So what do I read this morning?  A line worthy of an Ayn Rand villain:
Rahm Emanuel, the incoming White House chief of staff, has said, "You don't ever want to let a crisis go to waste: it's an opportunity to do important things that you would otherwise avoid."
I'm still not convinced that Obama will be the next FDR.  To riff off Samuelson, scary quotations by high-ranking officials have forecast nine of the last five transitions to socialism.  But I am convinced that many people in high places have bad intentions.  If we avoid the worst, we will have gridlock - not our leaders - to thank.


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COMMENTS (33 to date)
John Thacker writes:
If we avoid the worst, we will have gridlock - not our leaders - to thank.

Didn't you see the election results? Gridlock? Hah.

Richard writes:

Emanual said that about three months ago. Bryan, where have you been?

Les writes:

I certainly agree with Bryan that "... I am convinced that many people in high places have bad intentions. If we avoid the worst, we will have gridlock - not our leaders - to thank."

But, as previously pointed out, the blessing of gridlock is no longer available. The Rahm Emanuels are tossing free enterprise out and bringing in socialism at warp speed.

Zachary Skaggs writes:

Forgot that you were on the Cato ad. Woulda stayed late to bug you had I known you were coming!

Dan writes:

Where is Naomi Klein when you need her?

scott clark writes:

Yea, Dan,

Klein looks brilliant at this point. By promoting the concept of disaster capitialism, she forced capitalist thinkers to argue against disaster capitialism, rather than actually fighting against disaster socialism.

Elvin writes:

Bryan:

Hanlon's razor: Never attribute to malice that which can be adequately explained by stupidity.

Grey's law: Any sufficiently advanced incompetence is indistinguishable from malice.


El Presidente writes:

Bryan,

But I am convinced that many people in high places have bad intentions.

I love it when other economists engage a philosophy of ethics. Is it that their intent will produce outcomes you believe are bad in a hedonistic utilitarian sense, or that their intent itself is bad in a Kantian deontological sense?

I generally think they have good intentions and they are more than competent to most of the tasks of their offices . . . but you know what they say about the road to hell. Makes me wonder where the road paved with bad intentions leads. :-)

My fear is that their actions are overdue in terms of the ideal timing to affect the outcome they seek and premature in the sense they are not yet sufficiently coordinated to identify and engage the causal mechanism that will produce their desired outcome. Measurement is gonna be a booger.

Zac writes:

On the one hand, our leaders are terrible people with terrible intentions. On the other hand, evidence suggests that Average Joe is even worse, and is unhappy with the current, low level of oppression. The tools for bad policy are there, and there appears to be no reason why those same tools couldn't be used to enact even worse policy. I can only assume our leaders are afraid to give the people the bad policy they want, and will continue to be so. I have little doubt things will get worse, but once they start to get really, truly bad (don't kid yourselves fellow libertarians: things are not really, truly bad right now) I believe our leaders will start to be afraid again. When people are really poor and really suffering, they will blame those who are in power.

Anyone citing the relatively large margin (by recent standards) by which the democrats won this election, and using that as evidence that there is just no check to our precipitous decline into serfdom, look at the presidential election of 1964. The large margin of victory there was definitely a mandate for socialism, and of course we got many many bad policies, but somehow we got by and did not become a socialist dictatorship.

The idea that the election of Barack Obama is the end of capitalism is just overblown. Events thus far simply do not warrant statements like "Obama is the next FDR" or "Obama is worse than FDR" or "Obama is the next Hitler". Yet.

Jeff H. writes:

"Only a crisis - actual or perceived - produces real change. When that crisis occurs, the actions that are taken depend on the ideas that are lying around. That, I believe, is our basic function: to develop alternatives to existing policies, to keep them alive and available until the politically impossible becomes politically inevitable."

-Milton Friedman

Is this sentiment much different from Emmanuel's?

8 writes:

I think Friedman is thinking that politicians in power will ask, what's the best policy for this crisis? Emmanuel is saying, we have a crisis, best policy be damned. We'll do what we want. In that case, the policy is a totally random outcome based on where the voter dial stopped last.

Randy writes:

Our leaders seek power - the ability to enforce their will at our expense. That's bad. So their intended use of that power once obtained is irrelevent. Now, if they were offering their services on a voluntary basis, a free exchange of value for value, that would be different. Then their intentions, their marketing, would mean a great deal.

Lee Kelly writes:

El Presidente,

I love it when philosophers try to engage in the philosophy of ethics. The results are calamitous.

RickC writes:

El Presidente,

You have a lot more faith in the abilities of politicians than I do. To paraphrase Mencken, "The urge to fix the economy is almost always only a false-face for the urge to be in total control of it."

On bad intentions, I think one should always start from the position that politicians always have the worst of intentions, and make them earn their way into our good graces. I'm still waiting to have one prove me wrong. And before you start, the first measure for me of a good president would be if he didn't break his oath to uphold the Constitution, especially in relation to staying within the enumerated powers given him.

El Presidente writes:

Lee Kelly,

I love it when philosophers try to engage in the philosophy of ethics. The results are calamitous.

I agree. I think that's usually because they're doing it wrong.

This is the best functional model I've seen: http://www.mcb.unco.edu/ced/index.cfm

The problem is typically that they cling to one or another characteristic of ethical behavior, often at the expense of all others. There are at least three defining elements of ethical behavior: conscience, material consequence, and relationships. Consideration of each one individually is necessary and insufficient for a universally recognizable ethic. Place equal parts Kant, Hume, and Aristotle in a blender and set on high for two minutes. Voila!

Plato rightly acknowledged the insufficiency of human perception and I extend that to the study of ethics. We can be, at most, moral agents, and then only in conjunction with a moral authority. All the more reason why studying ethics by describing and pursuing the elements of morality that we perceive and can articulate is a worthwhile exercise . . . frequently in economics as well, if you ask me. It's philosophical constrained maximization, so to speak. :-)

El Presidente writes:

Rick C,

On bad intentions, I think one should always start from the position that politicians always have the worst of intentions, and make them earn their way into our good graces. I'm still waiting to have one prove me wrong.

The one's I've known aren't trying to prove you wrong. It would seem to be an exercise in futility. You'll be waiting a long time, and yet you are already wrong with respect to many of them. Anatol Rapoport and Robert Axelrod might disapprove of your strategy as it is likely to invite hostility in kind.

I empathize with your sentiment, but I don't think your suggestion is likely to bring about your desired effect, which I presume is to have a politician that has something other than the worst of intentions. I occasionally question why I chose to have anything to do with government. It's hard enough to do the job. Being anonymously distained by the general public for kicking against the pricks is like opening my front door to a flaming bag of poo. Sometimes I'd like to say, " 'Scuse the hell out of me for trying to help." But, of course, a good public servant would never say nothin' like that.

RickC writes:

El Presidente,

"Government is not reason; it is not eloquent; it is force. Like fire, it is a dangerous servant and a fearful master." - G. Washington

"The greatest danger to liberty lurks in the insidious encroachment by men of zeal, well meaning but without understanding." - Louis Brandeis, Surpeme Court Justice

Throw in a little Hayek on the "fatal conceit" and the pretense of knowledge.

Whether rightly or wrongly, we are all judged by the company we keep. And I'm sorry, but you cannot look at the monster we call federal government today and feel very positive about its ever increasing role in our lives.

I'm also sorry that even on this and most other "libertarian" flavored sites, the discussion about reversing the explosion of government is hardly ever mentioned. It is more about nitpicking whatever grand solution government agents have dreamed up to "fix" that abstraction we call "the economy". The only real solution is to cut the monster off at the knees. That is the argument that needs to be repeated over and over, and supported with good research and argumentation.

Jim Glass writes:

See Rahm Emanuel's lips move, hear the words emerge:

http://www.youtube.com/watch?v=_mzcbXi1Tkk

[Comment edited for rudeness. Please do not engage in name-calling on EconLog.--Econlib Ed.]

Troy Camplin writes:

If I wanted to foster a crisis in help for people in need in general, and in the health care system in particular, the first thing I would do would be to try to get rid of tax deductions for charitable giving and make it impossible for religious hospitals to stay open. Obama has proposed doing the first -- or, at least, to cut it in half -- which has managed to find opposition from a few Democrats, causing him to (temporarily) back down from it. Abortion legislation just passed, making it illegal to refuse to perform an abortion no matter what your beliefs (which I'm pretty certain violates the 1st Amendment), will cause Catholic hospitals across this country to shut down.

Don't think that any of this is an accident.

The attempt to reduce the tax deduction for charitable giving is intended to cause a reduction in charitable giving -- during a time when charitable donations are down anyway, due to the economy. Such a move would be the final death blow to perhaps most charities. The result will be less private sector aid for people, meaning the government will have to step in to fill the gap -- with the added benefit of being able to claim that the private sector has failed in the realm of charity.

The abortion law is also intended to have a similar effect. Regardless of your position on abortion, I would hope that you could agree that nobody should be forced to perform abortions if they don't want to do so. This legislation is designed to run off doctors and to cause religious hospitals to shut down. You cannot tell me that the people who passed this legislation didn't know that the Catholic church couldn't run a hospital that performed abortions. Why would they want to pass legislation that would shut down hospitals? Well, religious hospitals are often charity hospitals, meaning they provide inexpensive or even free health care to poor people and those without health care. If these hospitals shut down, it will actually create a health care crisis in this country. This will make it even easier for the government to nationalize the health care system. And, again, they will be able to point to the "failure" of the private sector to provide health care to the poor and uninsured.

Regardless of whether or not you agree with nationalized health care, you have to agree that such tactics are highly unethical. If bad action is doing something bad in ignorance of the good, and evil is doing something bad knowing what the good is, and choosing do to the bad anyway . . . Well, I'll let you decide the moral state of this administration.

El Presidente writes:

RickC

Whether rightly or wrongly, we are all judged by the company we keep.

Wrongly then. Is that was passes for scientific inquiry or academic integrity?

And I'm sorry, but you cannot look at the monster we call federal government today and feel very positive about its ever increasing role in our lives.

I don't see it that way.

The only real solution is to cut the monster off at the knees. That is the argument that needs to be repeated over and over, and supported with good research and argumentation.

If it was backed up by good research and argumentation I would be very intereted in listening and I doubt you'd need to tell me twice. Until it is, it's a waste of breath. I could give you the best evidence to make that case and yet I know first hand that it would still be a fallacious argument. I would be the Johnny Cochran of public choice, making a false argument that nobody in their right mind ought to believe but doing my damnedest to make sure they do. Whatever justification you might have for presenting it makes it neither true nor constructive for the rest of us.

Starve the beast is a tired old mantra that needs to die a long overdue death. If we identify goals and then rationally deliberate on how to achieve them, I couldn't care less what amount of government spending and employment we end up at so long as our actions are well designed to meet the goals on which we agree. Just be rational, that's all I ask. Your argument does not seem very rational. Government likewise often seems quite irrational. I'm working to make government more rational. Would you do the same for yourself?

Arnold likes to riff on the size of government too, so I'll pose the same question to you that he has so often declined to answer: what is the right size of government? Tell us in terms of employment or spending or both what size is optimal. Smaller is not a size, it is a direction, an inequality. Tell me when it will be small enough and why and I might entertain the possibility that you have a reasonable basis for your sentiment. Until you can do that, you're like a lost man saying we all must go East but knowing neither where we are nor where we are likely to end up and all the while insisting we must move. Is that what you intend to be?

Randy writes:

"[W]hat is the right size of government?"

The size that people are willing to pay for in a voluntary exchange of value for value. In other words, the answer is exactly the same as if the question were about any other product or service.

We'll never know, of course, but it seems pretty obvious to me that there is a serious overproduction of government due to its ability to require the population to pay for its so-called "services".

Randy writes:

... unless, of course, we're talking about a government whose purpose is to exploit, in which case, the right size is that which produces the maximum amount of revenue to the exploiters.

Jim writes:

[Comment removed for supplying false email address. Email the webmaster@econlib.org to request restoring this comment. A valid email address is required to post comments on EconLog.--Econlib Ed.]

RickC writes:

El Presidente,

I seriously can't tell if you're joking or not. If not, your faith in the reasonableness and rationality of government is heartwarming, but it is not based in reason or on the wealth of knowledge gleaned from history.

A quick survey of modern history, for instance, reveals a period when millions of people worldwide put their faith in reason and the state, only to have that faith crushed by two world wars, well over 100,000,000 people dead, millions of others rounded up into gulags, re-education camps and plain old death camps. All the while, the people's "leaders" and their sycophants were expounding on the infallibility of the new political and economic sciences. Just trust us, they said, we're reasonable and will bring about a fresh new world with "new men" to populate it.

As for the reasonableness of my own argument in support of limited centralized government, I offer nothing new. I simply side with Washington, Jefferson, Adams, Madison, Lord Acton, John Taylor of Carolina, Mises, Hayek, Mill, and a whole host of others that make up the list of defenders of the classical liberal view. Maybe you should ask yourself why they so feared an unlimited centalized power.

El Presidente writes:

RickC

I'm not joking. Now you know.

[Y]our faith in the reasonableness and rationality of government is heartwarming, but it is not based in reason or on the wealth of knowledge gleaned from history.

How do you know that I have said faith, and how would you presume to know what it is based on?

Maybe you should ask yourself why they so feared an unlimited centralized power.

I might, if one were in the offing. Then again, I wouldn't have to because I already know. I've read them. You could have asked, but you didn't.

I'm not interested in your assumptions about me. I was interested in your argument . . . until you posted that.

RickC writes:

El Presidente,

I say you have faith because you said, "I'm working to make government more rational." I say there is no way you can do that if you mean expanding the role of central government and I even question whether making the federal government more "rational" is a worthy goal.

To support my position, I offered as evidence the 20th Century's massive death and destruction brought about by true believers who thought they could, through reason (as defined by themselves) and the new social, political and economic "sciences," change humans for the better and create a more perfect and just world. You responded with nothing of substance as to why you think you can make government more rational and less destructive of life, wealth and liberty than history has shown it to be.

Of course, you can't because government doesn't and never has worked that way. And you can apply all the reason and good intentions you want but in the end you will still suffer from something similar to Hayek's "knowledge problem". In the case of national programs for instance, no government agents or experts can know for certain beforehand that their machinations will lead to the specific outcomes they desire. Nor could they know that their interventions would accomplish these goals while having no unintended or adverse consequences which could exasperate the problem they were trying to solve in the first place or create new, more serious problems. There are numerous historical examples of this fact.

As if on cue, here's German Interior Minister Schauble commenting on the current economic crisis this week.

“We thought we were not as stupid as speculators in the 17th century who traded in Dutch tulip bulbs and annihilated everything,” he said. But, he added, “we have been just as stupid.”

In point of fact, Minister Schauble could be speaking for the vast majority of government officials and experts around the world. He's just wrong about stupidity being the cause. The real cause is hubris. I see it everyday in government officials and so-called "experts" whose knowledge and "science" was unable to predict this crisis, but who nonetheless feel completely confident in offering up their own advice for how to "fix" the problems. If they couldn't accurately predict the crash, they have no real understanding, if they have no real understanding then of what value are their prescriptions for its cure? You'll forgive me if I choose not to trust them.

Then you say, "I couldn't care less what amount of government spending and employment we end up at so long as our actions are well designed to meet the goals on which we agree." Quite frankly, that is just not very smart and it was so weak I almost chose not to respond. It is also a statement of faith.

I presume to say this because your statements lead me to think you suffer from the progressive faith in "experts"; that intelligent and well-meaning "experts" can and eventually will design a system which will function just as you hope it will. I say there is no centrally devised and managed system, no matter how many experts take part in its design, that will accomodate the goals of 305,000,000+ people spread out over a geographic area the size of the U.S., and living in diverse socio-economic settings.

The signers of the Constitution recognized this, hence the limits they placed on federal powers.

I suspect however, that you and I will just have to agree to disagree as to the proper role of the central government. I'll stick with the limited role first envisioned by Jefferson, Adams, Madison, Washington and company.

As for my suggesting you should ask why so many in the classical liberal tradition warned of centralized power, I ask you to understand my confusion. You had just stated that you cared not for how big or expensive the federal government grows during this crisis and that if you heard a good argument for why the Federal government should be downsized you wouldn't have to be told twice.

So none of the writings of those people I listed, and which you profess to have read, give you not a moment's pause about advocating such a massive expansion in the central government's powers? Their warnings had no effect on you? You found their arguments weak and without merit?

RL writes:

Not only are Atlas Shrugged villains walking the earth, but Atlas Shrugged heros are nowhere to be found. It's as if they vanished, holed up in some secret community somewhere... :-)

El Presidente writes:

RickC,

I say you have faith because you said, "I'm working to make government more rational." I say there is no way you can do that if you mean expanding the role of central government and I even question whether making the federal government more "rational" is a worthy goal.

You sorely misrepresent my intent, and you seem eager to do so.
We certainly seem to disagree about goals.

Then you say, "I couldn't care less what amount of government spending and employment we end up at so long as our actions are well designed to meet the goals on which we agree." Quite frankly, that is just not very smart and it was so weak I almost chose not to respond. It is also a statement of faith.

Perhaps you should have gone with your first instinct. When I say I do not care what size, I mean exactly what I say. I would be just fine with making government smaller if it was done to accomplish a shared goal. But I would be equally willing to make it bigger if that is what we choose in an informed, deliberate way. I don't care. Rationality can only be defined with respect to an objective. What is the objective? I don't know that it can be stated more clearly and I can only conclude from your response that you don't understand the English language or you are spoiling for a fight. Either way, it bores me. Smart? Please.

I've read Hayek and I am familiar with his critique. Funny thing is that I work in government and I do things every day that bring about the outcomes I intend. So, boogymen aside, it would seem that 1.) Hayek is wrong; 2.) absolute knowledge is unnecessary; or 3.) I am exceptionally lucky or delusional. What is your pleasure? No, wait, I can guess.

You are the one who stated a preference (smaller government), and yet you do not articulate where that preference leads and why we ought to go there with you except that you read about it in some works written by famous people. You wrote a lot but you haven't answered my central question to you: what is the right size of government? If you don't answer, I won't ask again. I'll just assume you have no idea how to go about deciding on such a thing and that you do not know what would please you. It would therefore be a fool's errand to try. I won't even feel bad doing so since you seem so eager to assume all sorts of ridiculous things about me and then criticize me for them as though they were true.

See, while Randy and I occasionally disagree about the propriety of government compulsion and prohibition, at least he articulates an alternative, one worth considering and not altogether without merit. That's what I like about Randy. Even so, he can't say what size government would be, though he gives an indication of how we can know when we have achieved the right size: nobody will feel compelled or prohibited by government against their will. Incidentally, this isn't so much a function of a particular size but rather an agreement about government's proper size. Under Randy's system, if we all agreed to have a bigger government that would be fine. So, the reality that some of us would like it smaller is the only reason that it would need to be smaller; not because smaller is necessarily better. But, at least he has offered an alternative. You could learn from Randy . . . or, maybe you can't. How would I know?

Ray G writes:

I just quoted this to my neighbor, and he thought that perhaps it was a good thing. (To use a crisis to push radical legislation that would otherwise not stand a chance.)

We kept talking, but the conversation was pretty much over.

Randy writes:

El Presidente,

"Under Randy's system, if we all agreed to have a bigger government that would be fine."

Just to clarify, what I have in mind is a government organized under the moral principles of the productive class. That is, only real contracts are necessary, not any kind of social agreement. Those who want something from government would pay for what they want.

So yes, under such a system the government could be quite large. If, for example, it offered some sort of social insurance program that hundreds of millions wanted and were willing to pay for, it could become huge, wildly popular, and turn a massive profit. But no one would be forced to participate, and competition for the service would be allowed. So government could also be quite small if its services could not compete with free market alternatives.

My guess is that under such a system government would shrink to roughly a fifth of its current size, as most of us working class types would find no value whatsoever in paying for foreign involvements, and would find far more efficient methods of caring for ourselves in old age, obtaining healthcare, determing product quality and safety, getting ourselves back and forth to work, etc., than the restrictive and self-aggrandizing methods that the best minds in government have been able to imagine.

Current events; President Obama is talking about creating a government run healthcare system that would compete with existing private providers. I have no problem with this, as long as it is completely voluntary and completely self contained - no subsidies of any kind.

Randy writes:

Since I'm awake...

The system describe above could only be implemented under a government of agreement. More precisely, a government that is truly representative. More precisely still, a government in which any significant minority had the ability to veto proposed legislation.

I propose that a way to achieve this would be to allow anyone who receives 25% of the popular vote to take office. That is, each office could have up to 4 office holders, all of whom would have to agree before their shared vote would count.

...Of course, a system of agreement is not what we have, which to me is solid evidence that the purpose of our government is exploitation.

El Presidente writes:

Randy,

...Of course, a system of agreement is not what we have, which to me is solid evidence that the purpose of our government is exploitation.

Well, there would be no guarantee of agreement if we went with the electoral approach you propose. So, I guess I wonder if the effect isn't merely to make the threshold for government action higher and therefore to curtail further government action. My roots are in political science so it occurs to me that a parliamentary system might be more along the lines of what you'd prefer, a la Woodrow Wilson. That would tend to produce more moderate and more broadly supported policies, or rather to frequently preclude those that are not. How does that strike you?

Randy writes:

You had it right the first time. I favor a system that would greatly curtail government action. The 25% threshold would allow minimalist elements to block nearly all legislation. But even a 40% threshold would be a considerable improvement, as there would be a Republican and a Democrat in nearly every office, and they would have to agree to pass any new legislation. Hell, in a perfect world, all existing laws would have to pass a review, and those without agreement would be eliminated.

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