David R. Henderson  

Warren Gibson on Bad Libertarian Arguments

Mandela and Communist Villainy... Predicting the Popularity of O...
I'm a dedicated libertarian but my first allegiance is to accuracy. It pains me when I see libertarians making arguments that are inaccurate, irrelevant, or just plain wrong. When they do so, they do themselves and our movement a big dis-service. I list seven such arguments here. More could be added.
This is from Warren Gibson, "Seven Ways Libertarians Sometimes Run Off the Rails." Warren is an economics instructor at San Jose State University. Over the years, as I've gotten to know him, I have come to respect and like him a great deal. I won't repeat his arguments on each of the 7 ways. Read those for yourself. The piece is short and pithy.

I will, though, give, for each of the 7, my number of cheers, with 3, of course, being the maximum, along with, in a few cases, my own thoughts and comments. [Wow, that was a lot of commas.]

1. The Fed is privately owned. 3 cheers.
When I give talks to libertarian-oriented groups, invariably this assertion comes up in Q&A.
2. The Bureau of Labor Statistics disguises the true unemployment situation by excluding workers who are "discouraged," i.e., not seeking jobs. 3 cheers.
3. "Chain-weighted" versions of the Consumer Price Index are politically motivated. 2.9 cheers.
Why the missing 0.1? Because, in a literal sense, the chain-weighted version does have some political motivation, even though it is a better version than the non-chain-weighted. In about 2003 or 2004, I attended an economics roundtable at the Hoover Institution with George W. Bush's head of the National Economic Council, Stephen Friedman. I remember Mike Boskin, who is one of the experts on the issue, laying out the dramatic effect chain weighting could have on Social Security payments over time. I call that a "political motivation." Which doesn't mean he was wrong. If I had thought he was wrong, I would not have commissioned his piece for the Concise Encyclopedia of Economics.
4. The Consumer Price Index is politically manipulated by excluding food and energy. 3 cheers.
5. "Banksters" control the U.S. government. 3 cheers.
This is a subtle public choice insight that I often have trouble getting my students to see. Once I have taught them concentrated benefits/dispersed costs, they start seeing things differently and often go too far. In particular, they miss two of the biggest sets of players in the government: the politicians themselves, who constitute their own interest group, and the bureaucracy, which is its own interest group.
6. Global warming is a myth and a scam. 2.3 cheers.
It's not a myth and it doesn't have to be a scam. But the way it's used to justify some extreme policies is a scam. Warren's 3 basic facts are absolutely correct. But notice that they, in themselves, say nothing about global warming. Warren writes, "This would be a great time for all parties to step back an[d] exercise some epistemic humility. There's a great deal about this issue that we just don't know." That I totally agree with. Which is why I think it's hard to justify so many of the policies that believers in global warming agree with.
7. Let's get rid of the state entirely, and all will be well. 2 cheers.
On this one, I'm torn. I saw David Friedman interviewed on Stossel recently, pointing out that the biggest weakness in his own case for anarchism is that we might not get enough defense. But David pointed out that this is less of a weakness now, with the evil Soviet empire gone, than it was when he wrote the 1st and 2nd editions of his book, The Machinery of Freedom. And, of course, we're talking about whether all will be well in the context of politics and stability. Even if anarchism still led to a much more peaceful world, a conclusion that I am closer to believing than I ever was before, there will still be cancer, some poverty (though less), horrible train crashes, etc.

That's 19.2 cheers out of a possible 21.

Comments and Sharing

CATEGORIES: Economic Education

COMMENTS (17 to date)
Motoko writes:

#7 is a little disingenuous. First, almost no anarchist says that anarchy will have no problems and "all will be well". Second, the objection that another state will just rise up because of human nature is an extremely unsophisticated rendition of an already sophomoric response. Almost all anarchist writers answer this objection preemptively, and almost all statists can mount superior arguments against anarchism.

This is very touch-and-go, and I think not meant to appeal to more thoughtful readers.

David R. Henderson writes:

This is very touch-and-go, and I think not meant to appeal to more thoughtful readers.
Are you referring to all 7 or just #7.

nl7 writes:

Rarely is a person talking about global warming as a nerdy way to discuss the weather. There's always an implicit or explicit understanding that a big enough problem requires an enormous solution. Given that proponents lazily integrate the justification for a solution into the presentation of a problem, it's difficult to entirely fault the opponents for lazily blurring the same distinction.

The mere facts of warming, carbon's involvement, and human causes are not what most non-scientists mean. Most partisans who talk about 'climate change' are implicitly saying other things, like that it's a catastrophic problem, that it can be solved without disastrous costs, and maybe that the solution requires a major restructuring of ethical priorities. The first question is a separate scientific issue. The second question is not science so much as economics. The third question is philosophy and political science, given that climate science can't tell you how to organize your priorities or what rules should govern a society. Partisan opponents are really disputing the political conclusion that an economic restructuring is needed.

Partisans make it about the political side of the issue. Proponents reduce a complex issue to its social and political meaning (evolution is about modernity, GMO is about corporations, etc.). So while it's frustrating that people use the science as a shorthand for the political axe they're grinding, it's hardly unusual.

Jon Murphy writes:

Thank you for linking to this article. I must admit I am guilty of a few of these sins...

Andrew writes:

Do Libertarian's really argue that the Fed is privately owned?

On a side note. Xmas 2012. My cousin, who had just been hired at an entry level position with the Minneapolis Fed, learned during her orientation that the Fed is a private, 'non-governmental' institution. I hung my head in shame for my family and left the room.

Take that for however you want.

James writes:

Re: 1, In 1982 the 9th Circuit Court of appeals ruled that the Fed is a private entity.

In para 5 in the link: "Examining the organization and function of the Federal Reserve Banks, and applying the relevant factors, we conclude that the Reserve Banks are not federal instrumentalities for purposes of the FTCA, but are independent, privately owned and locally controlled corporations."

Feel free to disagree, but this is not just some libertarian fringe view.

Gregory Smith writes:

Demonizing bankers makes us sound like a bunch of communists.

The "end the fed" arguments are boring. We need issues that the average American can get excited about, like passing pro-Second Amendment laws, cutting big government, legalizing marijuana (but let's not make it the only topic of conversation), legalizing prostitution, supporting home schooling and charter schools.

I would also like to see less demonization of the police and the prison system. The average American wants to support law-abiding people, not criminal scum.

I'm not interested in understanding crime, just wanna fight it. If you steal because you're poor, I don't give a crap, plenty of people steal and they're not poor. If you're in jail because you got caught with crack, I don't care, most people don't do crack.

The war for freedom needs priorities, while it's true that a man getting out of prison should have his voting rights restored, this is not a first priority.

David R. Henderson writes:

Interesting. Thanks.

John Becker writes:

Gimme a break. Number One is really tricky. I think that the Fed is best treated as a wing of the government but it has some notional private aspect and was created for bankers by bankers.

David Friedman writes:

With regard to 7.

According to Gibson: "Given the present primitive degree of evolution of our species, a new state will pop up wherever an existing one is overthrown."

We know that various past societies, such as the Commanche indians, the Bedouin, and the northern Somalis, maintained stateless societies for extended periods of time. It would seem to follow that, on Gibson's account, their inhabitants were further evolved than we are.

Or is he claiming some natural law such that, once a stateless society has experienced a state, it can never again maintain statelessness?

Bedarz Iliaci writes:

Given the present primitive degree of evolution of our species

As compared to which non-primitive species?

How exactly is State defined here or elsewhere in libertarian circles?
I may define a State as a particular human community organized for long-time survival and flourishing. There are settled laws and customs and ways to adjudicate disputes and mete out punishments. I wonder, per this definition, has there been any stateless society?

That would be a society in which organization was limited to family level only. But the family is not a self-sufficient entity as Aristotle recognized. A larger level is needed and that level is called a City-State.

Shane L writes:

"We know that various past societies, such as the Commanche indians, the Bedouin, and the northern Somalis, maintained stateless societies for extended periods of time."

My understanding had been that such societies were very violent, rocked by common raids and occasionally massacres*. I had also believed that they were relatively simple societies with small collections of population, little division of labour and so on, not developing cities and industry, and therefore materially poor.

However I'd love to know I was wrong! Can you correct me?

*Lawrence H Keeley's "War Before Civilization"

Chris writes:

Sorry if this makes me a newbie, but can someone explain what is wrong with argument #2 (other than that it is incomplete)?

David Friedman writes:


The Commanche were very violent, although their violence was mostly directed at other people. One of my students just did a paper on the Bedouin (for my "Legal Systems Very Different from Ours" class) and they seem to have relatively low levels of violence--a feud system in which most feuds end up settled peacefully. Saga period Iceland wasn't quite stateless, since there was a legislature and a court system, but there was no executive arm of government, so enforcement was entirely private. As best I can tell, it was less violent then contemporary societies with kings.

A suggestive comparison there is between the conversion from paganism to Christianity in the year 1000, which occurred after conflicts that killed about ten people, and the conversion to Lutheranism some centuries later, when Iceland was under royal rule--which killed quite a lot more people in a smaller population.

I've read Keeley, and he may well be correct that primitive societies had high levels of violence--although the violence he describes is mostly out group not in group. But I'm not sure that correlates with state vs stateless.

David Friedman writes:

Bedarz asks: "How exactly is State defined here or elsewhere in libertarian circles?"

I can't speak to libertarian circles in general, but I discussed the question of what distinguishes a government from other institutions in my _Machinery of Freedom_ and expand on that discussion in one of the new chapters for the third edition, a draft of which is on my web page:


The short answer is that social order is largely maintained by a network of mutually perceived commitment strategies, such that I will respond to what I see as violations of my rights by opposing them even at what, on a simple view, is a cost much larger than the issue is worth. Because other people recognize the existence of that commitment strategy they usually don't violate my rights. I usually don't violate theirs for the same reason.

A government is an organization against which we drop those commitment strategies. Whether or not I approve of the government temporarily enslaving me (draft) or seizing some of my property without my consent, I don't respond with the force with which I would respond to another actor acting in the same way. That is what I meant, back in the first edition of the book, by defining a government as an agency of legitimized coercion, where "legitimized" is not a statement about moral legitimacy but about how people behave and "coercion" is defined not in moral terms but in terms of what people in a given society see as violations of their rights vis a vis other people.

Shane L writes:

Thank you David, very interesting.

Andy writes:

James: the Reserve banks are private, while the Board is government.

Comments for this entry have been closed
Return to top