David R. Henderson  

The Aristocracy of Pull, 2

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Inequality of Political Power... One-Party State Watch...

In a December post, I wrote about the aristocracy of pull, that beautifully descriptive phrase that Ayn Rand used in her classic novel, Atlas Shrugged. It refers to the use of government power to allocate resources. Today, my fellow blogger Arnold Kling rightly calls attention to Will Wilkinson's post on a 31-year-old in the White House who gets to make big decisions for General Motors. When I read that, I thought of the aristocracy of pull. As Arnold writes, Will's whole post is worth reading.

I do have one quibble, though. Like some of the commenters on his post, I think that Will, in an attempt to appear even-handed, brought in a red herring. He wrote:

Just as Republican "libertarian" arguments for decentralized government often aim to protect the tyranny of local prejudice, Democratic "egalitarian" arguments about inequalities in wealth and income too often aim at concentrating political power in the hands of people like Brian Deese.

It's not that I think that Will is wrong about the hypocrisy of many Republicans. It's just that I don't see the connection with this issue. One of the commenters on Arnold's post, by contrast, made a much stronger connection between Republicans and Democratics on planning people's lives. "Fundamentalist" wrote:

The Bush administration hired similar young, inexperienced cult followers to manage the redestruction of Iraq. Look at Iraq and see our future.

"Fundamentalist" is wrong, I think, in thinking that anything like the mess in Iraq is in our future. But it is true that the Bush administration had its Brian Deeses who thought they could plan the Iraqi economy just as Mr. Deese thinks he can plan GM. Both have what Hayek called the "fatal conceit."

Note: when I was putting in the links, I noticed that Atlas Shrugged, published over half a century ago, is at #253 on Amazon. Amazing!



COMMENTS (12 to date)
ed writes:

Trying to "plan" the entire Iraqi economy is really not the same thing as "planning" GM. GM is a firm, and firms have always been centrally planned, even within a market economy.

Perhaps you've heard of Ronald Coase?

El Presidente writes:

David,

I get the criticism of the personnel decision made by the White House. Good point. Understood. I'm not sure I agree with the central planning argument, but it makes some sense.

Here's what I don't understand, and maybe you can help since you're big on Hayek. In a free-market economy, people are allowed to do pretty much whatever they can persuade others to go along with. In that environment, money is power. So, if it is fatal conceit to think that the use of government power can bring about good, how is it not fatal conceit to think that the accumulation of power through disparate wealth is a good thing no matter what it brings about. To put it another way, at what point does disparate wealth, a form of power all its own, become dangerous if ever? What about the aristocracy of aristocracy? What about the dominance of oligarchs? Both of those words are perhaps too strong for what we see in American society today, or maybe not, but I think my question is clear enough. I just don't understand why one form of power is taken as vicous and the other as virtuous (except that some people equate wealth with virtue) without regard for the manner or circumstance in which it is exercised. Did I misrepresent your sentiment toward government power?

Brandon Robison writes:

Atlas Shrugged is actually even higher on the Amazon list if you look at the older (cheaper) edition of the book. It's #63.

Mark writes:

I agree with the main post that a better way to have been even-handed would have been to compare right wing control fixations (e.g., with respect to sex and reproduction) to progressive-left control fixations, e.g., on people's finances. Both are examples of the busybody phenomenon that libertarian principles would free us from.

P writes:

I've been reading Jouvenel's On Power recently, and it seems to me this is a misrepresentation of the classical aristocracy, who functioned as a limit on the king's centralized power.

The kings combatted this by elevating commoners to positions of bureaucratic power, so they would owe all they had to the king and not have their own estates to fall back on if the king was displeased. Like a 31-year-old law school dropout, for instance. ;)

Will Wilkinson writes:

I will defend my parallel. The idea is that liberalism is about both freedom and equality. The right tends to use the rhetoric of freedom, even when it aims to limit freedom, while the left tends to use the rhetoric of equality, even when it aims to increase inequality.

I think some libertarians and conservatives are annoyed by my specific example of this pattern because they genuinely think federalism is instrumental to freedom. But one can accept that this is generally true, as I do, while also accepting that arguments for decentralized government are often motivated by the desire to protect illiberal local policy.

John Thacker writes:
But one can accept that this is generally true, as I do, while also accepting that arguments for decentralized government are often motivated by the desire to protect illiberal local policy.

So the ends protect liberty especially in the long-run (mostly through the power of exit), the means protect liberty and use arguments of liberty, but some people might have unseemly motives?

Randy writes:

Great article Will.

Jeremy, Alabama writes:

Boortz is currently re-reading Shrugged, and is providing daily commentary on its relevance today. This may partially explain its popularity.

colin k writes:

presidente: traditional aristocrats are made so explicitly by color of law, while oligarchs almost invariably obtain their wealth through insider advantages conferred by political connections. left to their own devices, the children of the very wealthy seem to prefer lives of leisure, private contemplation, or drug-fueled orgies to the advancement of family wealth.

El Presidente writes:

colin k,

Oh, I see.

Lance writes:

The Bush Administration hardly tried to "plan" the Iraqi economy during the reconstruction phase once the Baath regime was toppled. Calling the professional economists who helped in the transition process "cult followers" is hardly fruitful in securing economic liberty for the Iraqi people.

The economists who worked closely with the Coalition Provisional Authority have an incredible story to tell about the challenges they faced in reforming the institutions of Iraq:

http://papers.ssrn.com/sol3/papers.cfm?abstract_id=887920

http://papers.ssrn.com/sol3/papers.cfm?abstract_id=1284044

We might as well say the Chicago-trained economists who helped Chile transition to a market-based economy attempted to "plan" the Chilean economy.

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