The study of human institutions is always a search for the most tolerable imperfections.
Richard A. Epstein
The study of human institutions is always a search for the most tolerable imperfections.
Richard A. Epstein
Posted by Georg Thomas on 09/23/2014 at 05:13 PM in 2012 Elections, Books & Media, Congress, Constitution, Current Affairs, Economics, Film, Georg Thomas, Health Care, History Lessons, Liberty Laid Bare, Social Philosophy, Socialism Gone Wild, State/Nebraska Politics, Supreme Court, Taxes and Spending, Technology, Internet, TSA Outrage | Permalink | Comments (0)
| | | |
The logic of modern technology underscores the importance of liberty for the advancement of our civilisation.
In an article well worth reading, Larry Downes argues forcefully that "largely absent from the platforms of Republicans and Democrats" there is an urgent
need for a radical shift at all levels of government, from laws and policies that delay and deflect disruptive change to an agenda that maximizes the profound potential of technological inventions to improve the human condition. [...]
There’s a better and safer way to protect and encourage disruptive innovation. First and foremost, governments must recognize severe limits in their ability to shape the destination, if not the trajectory, of disruptive technologies. Technology and policy run at different clock speeds, and the gap is getting wider. Even with the best of intentions, the most nimble regulatory agency still can’t keep up with the pace of change in consumer markets. When they try, the result, more often than not, is the invocation of the law of unintended consequences, where rules intended to encourage such noble goals as enhanced competition or the public interest wind up doing just the opposite.
A pro-innovation agenda begins instead by recognizing that markets are far more likely to resolve market failures than regulators, and to do so at a lower cost. This is not because markets are perfect, or appropriate subjects of uncritical reverence, but simply because markets react more quickly than do governments to the negative but usually short-term side effects of disruptive innovation. The next generation of technology is far more likely to remedy consumer harms than regulatory intervention can, and with considerably less economic friction. [...]
Americans, especially those under the age of 30, are deeply cynical about the political process. They live in a universe where technology can be counted on to make the world better and more interesting every 12 to 24 months, where life is approached as a series of problems to be solved through clever hacks, where even impractical dreams can be realized in weeks through a successful Kickstarter campaign. Why should they trust policy-makers who don’t live in their world, or share their optimism for its future, and who can’t be counted on to do what it takes to maximize its potential? Even if that just means staying out of the way.
Make sure to read the entire article.
Posted by Georg Thomas on 09/20/2014 at 12:50 PM in A Climate of Changes, American Culture, Books & Media, Congress, Current Affairs, Georg Thomas, History Lessons, Liberty Laid Bare, Media/Media Bias, Pure Politics, Republicans, Social Philosophy, State/Nebraska Politics, Supreme Court, Technology, Internet | Permalink | Comments (0)
| | | |
Contrasts of black and white can be wonderful, but they are not a useful pattern to grasp freedom. Image credit.
As with a number of other ideological staples of certain brands of demagogic libertarianism, I have come to oppose also their contempt of democracy. Like anarcho-capitalism and crypto-anarchism, both of which many libertarians subscribe to, we are dealing here with bundles of attitudes that purport to favour freedom while, in fact, they are incompatible with her.
A free society is unthinkable unless all citizens have access to the processes of (a) government and (b) the control of government. Political participation is as vital to freedom as it is complex, multi-layered, ambiguous and often messy and woefully imperfect. However, these deficiencies are only additional reasons for the need to defend freedom through the political processes of an open, democratic society.
Underlying libertarian contempt for democracy is an unwillingness to acknowledge the presence of political scarcity, i.e. the presence of political ambitions that are fiercely rivalrous, that is: the presence of diverging political values and aims that are intensively desired, yet incapable of being met simultaneously.
There are vast fields of political scarcity in a modern society, in fact, in any type of society. The libertarian conceit is that markets or market-type bilateral and mutually consenting transactions can successfully overcome political scarcity. The fact of the matter is, however, they cannot.
Libertarians of the anti-democratic bent manage to misunderstand both
The often triumphantly evoked fact that the constitutional texts do not contain the word "democracy" is spurious. The American Constitution is a product of democracy, and it is purposefully enmeshed in a network of democratic processes, or as Akhil Reed Amar writes in his magisterial America's Constitution. A Biography:
It started with a bang. Ordinary citizens would govern themselves across a continent and over the centuries, under rules that the populace would ratify and could revise. By uniting previously independent states into a vast and indivisible nation, New World republicans would keep Old World monarchs at a distance and thus make democracy work on a scale never before dreamed possible.
See below Philip Pettit's lecture recently held at University College Dublin, in which he outlines the contours and challenges of republican democracy - the lecture itself commencing at time mark 04:00:
See also my Liberalism - A Manifesto.
Until just over a century ago, the idea that a company could be a criminal was alien to American law. The prevailing assumption was, as Edward Thurlow, an 18th-century Lord Chancellor of England, had put it, that corporations had neither bodies to be punished nor souls to be condemned, and thus were incapable of being “guilty”. But a case against a railway in 1909, for disobeying price controls, established the principle that companies were responsible for their employees’ actions, and America now has several hundred thousand rules that carry some form of criminal penalty. Meanwhile, ever since the 1960s, civil “class-action suits” have taught managers the wisdom of seeking rapid, discreet settlements to avoid long, expensive and embarrassing trials.
The drawbacks of America’s civil tort system are well known. What is new is the way that regulators and prosecutors are in effect conducting closed-door trials. For all the talk of public-spiritedness, the agencies that pocket the fines have become profit centres: Rhode Island’s bureaucrats have been on a spending spree courtesy of a $500m payout by Google, while New York’s governor and attorney-general have squabbled over a $613m settlement from JPMorgan. And their power far exceeds that of trial lawyers. Not only are regulators in effect judge and jury as well as plaintiff in the cases they bring; they can also use the threat of the criminal law.
Posted by Georg Thomas on 09/08/2014 at 03:42 PM in American Culture, Books & Media, Congress, Constitution, Current Affairs, Economics, Electoral Prospects, Film, Georg Thomas, History Lessons, Media/Media Bias, Pure Politics, Social Philosophy, Socialism Gone Wild, Supreme Court | Permalink | Comments (0)
| | | |
At The Library of Law and Liberty blog, Michael S. Greve has an intriguing post on "The German Connection". After the collapse of the Third Reich, there was a thorough rejuvenation of the rule of law (Rechtsstaatlichkeit) in Germany, the substantive notion of the rule of law being strongly committed to liberal (European meaning) principles. At a time when progressives continued in renewed waves to turn over the liberal conception of the rule of law in the US, German courts would stubbornly and successfully defend the newly regained liberal legal regime in Germany.
In the late 1960s, courts and then Congress institutionalized so-called “citizen suits” against government agencies. Unlike regulated parties, citizen plaintiffs don’t have at stake anything you’d recognize as a right; they represent broad, widely shared values. (Environmental groups are the prototype.) The idea was that agencies were routinely “captured” by regulated industries, so there had to be a counterweight—parties with legal entitlements to make executive branch agencies obey the purposes of Congress, as embodied in statutory law. To that end, statutory citizen-suit provisions typically authorize “any citizen” to sue the administrator for failure to perform a non-discretionary duty. So when the statute says that the Environmental Protection Agency “shall” regulate and the agency falls short, environmental groups have a cause of action. They’re equal participants in the agency rulemaking process and in court.
At that time, what was then West Germany was also discovering the issue of protecting the environment. People were apoplectic about pollution. Nuclear reactor sites had to be protected with paramilitary force. A Green Party was beginning to form. And, some lefty law profs trooped to Harvard, learned about citizen suits, and tried to import them into their own country. They penned learned articles about the “enforcement deficit” in environmental law, wrote model statutes, and proclaimed that even Amerika has citizen suits, the better to promote law and democratic participation. Why can’t we have that?
Because you can’t, the West German legal establishment responded. The key argument against citizen suits was not that they would disrupt orderly administration, or invite abuse, or overload the courts. It was: what you people are advocating is Nazi jurisprudence. We’ve thought and worked for decades to get rid of that garbage, and you’re not going to undo our accomplishments just because people get upset about—well, garbage. The citizen-suit trial balloon soon shared the Hindenburg’s fate. There’s no trace of the debate in administrative law to this day.
To be absolutely clear, I am not calling U.S. public interest groups and citizen-suit advocates Nazis. My point is that a legal instrument that well nigh everyone stateside accepted, often with great enthusiasm, went down in flames over there, as an intolerable assault on a liberal legal order. To rehearse the German professoriate’s key argument against citizen suits:
The point of law and especially administrative law (they said) is to protect rights against coercive state interference. To that end, we have independent courts that will perform de novo review on law and facts. If we want to keep that up, we must limit the courts to rights protection. They can’t review the legality of governmental conduct outside that context. A plaintiff who sues for that purpose is asking the court to command the performance of his private idea of how public authority ought to be exercised, and that’s not a right he has or courts can enforce. Likewise, it’s not the business of courts to make government and law more “democratic.” There are institutions, such as political parties and parliaments, to safeguard democracy and participation. Courts, in contrast, guard rights—if need be, guard them against democratic demands.
If you want to mobilize courts as engines of law-enforcement and democracy (the argument continues), they can’t be independent. If you want them to do the will of the people, go make them instruments of that will—and stop the pretenses about individuals’ rights.
Germany took that path once: in 1934, the Reichstag authorized a version of the allgemeine Buergerklage—the general citizen suit. It did so for obvious reasons. The inherited Weimar bureaucracy might not always enforce the new authorities’ race laws with the requisite speed or resolve. What was needed were actions by private informers or Citizens United for the Separation of Jews and State to enhance public participation and ensure obedience to law. That meant, however—and alongside the enormities recorded by history—the end of an independent judiciary. You cannot surrender the exercise of law to “democracy,” nor can you surrender the Staat to a “movement.” Not if you want to have a liberal Rechtsstaat and a judiciary that is institutionally disposed to protect rights.
Make sure to read the entire piece.
Posted by Georg Thomas on 09/08/2014 at 02:30 PM in American Culture, Barack Obama, Books & Media, Congress, Constitution, Georg Thomas, History Lessons, Liberty Laid Bare, Media/Media Bias, National/International Affairs, Presidency, U.S., Pure Politics, Social Philosophy, Socialism Gone Wild | Permalink | Comments (0)
| | | |
Posted by Georg Thomas on 08/31/2014 at 05:29 PM in American Culture, Barack Obama, Books & Media, Congress, Constitution, Economics, Electoral Prospects, Film, Georg Thomas, Health Care, History Lessons, Liberty Laid Bare, Media/Media Bias, Presidency, U.S., Pure Politics, Social Philosophy, Socialism Gone Wild, Supreme Court, Taxes and Spending | Permalink | Comments (0)
| | | |
An excellent book, brief, to the point, a great help in focusing on the essential, and a powerful and incisive refutation of the errors in fashionable/progressive constitutionalism. Though focusing on specific issues like "judicial activism", Sandefur provides a comprehensive account of the basic tasks and features of the Constitution.
Particularly interesting are his accounts of
by giving the federal government "power ... to protect by national law the privileges and immunities of all the citizens of the Republic and the inborn rights of every person within its jurisdiction whenever the same shall be abridged or denied by the unconstitutional acts of any State," [p.63], and
"the Slaughter House Court removed the most potent protection against state overreaching and threw that double security out of balance." (p.70)
I am looking for similar books, preferably not too voluminous, that give the reader a concise notion of the essence of the American Constitution and the arguments behind it. I will be grateful for recommendations in the comment section.
Posted by Georg Thomas on 08/26/2014 at 07:26 PM in American Culture, Books & Media, Congress, Constitution, Electoral Prospects, Georg Thomas, Liberty Laid Bare, Media/Media Bias, Presidency, U.S., Social Philosophy, State/Nebraska Politics, Supreme Court, Taxes and Spending | Permalink | Comments (2)
| | | |
The two major problems with modern liberalism (European meaning) are a lack of
(1) theoretical fortitude to generally deal with the vast fields of contingency and indeterminacy opened up by greater freedom, and more specifically, a lack of
(2) doctrinal maturity to guide it in political participation.
Both deficiencies have a common source. The model of social order underlying modern liberalism is the market. But the market is only a subset within the broader social order.
Hume or Smith were never in danger of reducing the system of liberty to a mechanism that describes free markets. But when Hayek speaks of spontaneous order, he is already propagating the narrower vision.
I do not know when and why it occurred, at any rate, the tragic turn of liberalism looms when sight is increasingly lost of the spontaneous order of society at large.
Why would liberalism suffer such constriction? Maybe because its roots lie in a precapitalist world, and more importantly in a world where government could not possibly be anything but very small by later standards. Maybe because its heyday coincided with the breakthrough of commercial society. Small government and commerce looked like the essence of liberalism. They appeared to offer liberalism's ultimate formula for success.
Now, let me explain what I mean by "the vast fields of contingency and indeterminacy opened up by greater freedom."
(1) Freedom brought about capitalism. (2) Capitalism brought about wealth. (3) Wealth required and enabled mass political participation, and wealth made possible government endowed with unprecedented resources. (4) Mass political participation brought about unheard of demands on the state. (5) Unheard of demands on the state brought about big government.
Freedom brought about big government.
It is useful to think outside the usual box, for a moment, and admit that there are not only silly and objectionable grounds for a larger state to happen. At least from stage (3) on, the delta of implications deriving from mass political participation and unprecedented publicly available wealth becomes much too broad and complicated, too contingent and indeterminate to simply wipe away any consideration of larger government as an expression of base doctrinal dazzlement.
However, this is exactly the error committed by the liberal movement. By its very structure, the liberal doctrine was conditioned, or at least predisposed to heavily underweight political processes and the dynamics of state institutions and government. Liberalism yields to this propensity at a time when these are becoming the most powerful forces in society, next to free markets and civil society, by which latter I mean the growing independence of humans and organisations from the tutelage of the powers-that-be.
The irony, nay, the tragedy is that liberalism becomes a creed of political abstention, just at the time when liberty is taking off in the biggest possible way. This is the dawn of the era of the paradox of freedom. Liberty proliferates and grows all over the world, but liberals hardly participate in shaping her fate. Those among them ready to accompany liberty in the political realm quickly amalgamate with other political schools uninhibited to regard politics as a welcome tool to bring mankind advances that the smaller governments of yesteryear were utterly incapable of. This is the reason why, for instance, the German liberal party has become yet another branch of social democracy a long time ago. A liberal party, a strong liberal force in politics is simply not conceivable under the core paradigm. A liberal must cheat or desert in order to become politically effective.
I must use the word for the third time: it is a tragedy that the audacious vision of perhaps the greatest liberals ever, and the unparalleled success of their political activism have not become the guiding light of modern liberalism. Instead, liberals live estranged from and often embittered by a time characterised by more freedom than has been experienced in any period before ours.
It has been frequently remarked that it seems to have been reserved to the people of this country, by their conduct and example, to decide the important question, whether societies of men are really capable or not of establishing good government from reflection and choice, or whether they are for ever destined to depend for their political constitutions on accident and force.
(Federalist 1, par. 1)
The answer to this puzzle is not a foregone conclusion - it is an ongoing process of political activity producing partial answers.
Posted by Georg Thomas on 08/09/2014 at 06:24 PM in American Culture, Congress, Constitution, Electoral Prospects, Georg Thomas, History Lessons, Liberty Laid Bare, National/International Affairs, Pure Politics, Republicans, Social Philosophy, State/Nebraska Politics, Supreme Court | Permalink | Comments (0)
| | | |
The inequality scam
One of the most destructive popular myths is the idea that inequality is a severe problem and needs to be replaced by some state of enhanced equality - which always turns out to be inequality dysfunctionally rearranged according to the preferences of those with sufficient political clout. Why is the myth so popular? To like it you only need to regurgitate bromides that make you instantly likable and respected; to not like it you must think and look beyond appearances and face distrust and moral outrage.
Be that as it may, to some extent everyone reroutes the flow of information from a lecture like the below one by Richard Epstein through the filters of his personally preeminent themes. For me these were self ownership and first possession, which I happen to do some reading on at the moment.
A reflection on self-ownership
Let us concentrate on self-ownership, which is a concept I find awkward, maybe because one tends to associate ownership with inanimate objects or non-human creatures, and only odiously with humans (slavery). What self-ownership really means is a bundle of rights that legally entitle you to do certain things by applying your mind and body as you see fit. I have discussed the errors underlying the concept of absolute self-ownership in Elementary Errors of Anarchism (1/2) - explaining that self-ownership can have legal and moral meaning only as a relational concept, i.e. one reflecting and defining social relationships, for which reason it will always be constrained and conditional so as to allow for the necessary give and take between human beings. Absolute self-ownership (doing whatever one likes) and no self-ownership (being unable to ever apply ones mind and body as one sees fit) are two extremes that can never serve as modes of structuring social order. So self-ownership lies somewhere on a continuum between these extremes.
The attempt to qualify self-ownership by the so-called non-aggression principle fails. The principle posits never to violate a person's (bundle of rights called) self-ownership unless that person initiates aggression against you - which is why anarchists consider the state illegitimate, as it does initiate or threaten to initiate violence against people who have not initiated aggression against the state or anyone else. But this reasoning is remarkably naive, begging the all-important question: what is to count as illegitimate aggression? First, we have to settle what a person is allowed to do and what not; only then can we discern aggression from non-aggression.
The challenge then is to find a (more differentiated) system of command [a strong term admittedly, bear with me] generating rules that produce optimal outcomes from self-ownership.
It appears that now only three such systems of command remain to be considered:
The first two treat self-ownership as a residual outcome subject to communal or governmental approval, the second is based on a legal framework that seeks to leave as much discretion as possible to the individual regarding what she can or cannot do with the help of her mind and body.
(1) Communal determination of residual self-ownership - i.e. all human beings negotiating instantly and simultaneously with each other the content of self-ownership of each person, as in a Rawlsian world, where talents and other personal advantages that may be ascribed to luck are considered the property of all those not so advantaged, or the task is delegated to
(2) central determination of residual self-ownership - i.e. an authority endeavouring
(a) to approximate either the end specified under (1), or
(b) to impose a regime of rules that purport to serve an even better or morally more valid end, best known to and enforced by that authority.
Instead of self-ownership we could just as well use the term public ownership, as there will always be precepts within the bundle of rights that constitutes self-ownership which reflect public constraints on the individual - even anarchists admit this by conceding the non-aggression proviso. The term self-ownership, I surmise, is chosen to express strong support for a preponderance of decision making options delegated to the individual rather than to public discourse or public authorities.
The best system of command, the liberal would argue, occurs under a strong presumption in favour of
(3) determination of self-ownership under rules that represent a supra-jurisdiction, if you will, establishing in its turn a vast sub-jurisdiction for the individual to determine the content of self-ownership, i.e. the rule of law which enforces individually delegated decision making under common constraints, as opposed to the rule of man which is based on unconstrained decision-making by central authority.
This third approach to self-ownership amounts to an extensive privatisation of law. Rather than approval by the public or authorities, what is needed in order to act in a way covered and protected by the law is compliance with general rules that circumscribe broad areas of discretionary decision making by the individual. In fact, the modern state is the largest privatizer of law ever seen in history, enabling an unprecedented independence of decision making by individuals and organisations from the discretion of rulers - which is what we mean by civil society.
Under a law conceding extensive sub-jurisdiction to the individual, we can achieve more things and achieve them more readily and more peacefully.
Ultimately, the extent of (a) delegation empowering the individual and (b) its benign efficacy are a matter to be empirically established.
The whole belief in individual freedom is only as good as our ability to see where personal liberty ought to be fostered and where it must be enclosed.
Now, this is where Richard Epstein's lecture comes in instructively. He gives an outline of the reasons and conditions that make a preponderance of individual decision making power desirable, and indicates how liberty is strengthened by the very limits we put on her. He also explains how forcing equality damages the common weal brought about by self-ownership.
All in all, the lesson that I take away from thiinking about Epstein's belowlecture is that the key concepts of liberty such as self-ownership or private property must not be treated as conclusive dogmatic tenets but as testable scientific propositions, that in certain circumstances may prove to be incomplete and in need of complementation or contexually dependent suspension.
No such thing as market failure
Incidentally, the term "market failure" [time mark 07:15] is infelicitous, from a liberal point of view: there are things markets are not equipped to deal with, like making your neighbour fall in love with you. It would be just as inappropriate to say Georg fails because he cannot make your neighbour fall in love with you. Of course, Richard Epstein does understand this. Sometimes, however, one yields to linguistic convention. Sadly, "market failure" talk is a conventional habit that reflects the dominance of uneconomic and anti-economic thinking in our societies, and not only among "ordinary people" but very much among economists, too, who make careers by exploiting the market failure myth - like Joe Stiglitz.
Chris Berg of Australia's Institute of Public Affairs discusses "Too Big To Fail", and comes to a different conclusion than I do. He argues that the problem cannot be solved because it is an inherent concern of politicians to protect certain companies or institutions from terminal collapse.
I would argue, that only politics can change the present state of affairs. However, if libertarians are unwilling to participate in politics, eschewing the competition for political dominance of the state, matters are indeed bound to linger on in their unsatisfactory condition.
"Too big to fail" describes financial institutions, mostly banks, which have become so large and so deeply integrated into the financial system that if we let them collapse they would take everything else with them.
If a corporation is too big to fail, then, it follows, taxpayers have to bail them out.
It's quite a problem. A market economy is supposed to be dynamic, full of entries and exits. Firms that add economic value thrive. Those that do not go broke.
So bailing out failed companies makes the economy less efficient. More gallingly, it redistributes money from the poor to the rich. And it creates "moral hazard" - a belief by management that ultimately they won't have to pay for their mistakes.
Moral hazard is a particularly severe problem for banks. Banks trade on risk. A bank's basic job is to transform short-term highly liquid deposits into long-term extremely illiquid loans. Too much of the latter will prevent redemption of the former.
Too big to fail encourages banks to make riskier loans. Why wouldn't they? They're not the ones bearing the cost of failure. Taxpayers are.
So it would be great to get rid of too-big-to-fail. Or at least limit it somehow. The Murray Inquiry has a few ideas: higher capital requirements for bigger institutions, for instance, or new procedures for when banks do fail.
But the question isn't what should we do about too-big-to-fail but what can we do about it.
And the answer to that question is almost certainly nothing.
Make sure to read the entire article.
Hat tip to Sinclair Davidson.
Posted by Georg Thomas on 07/22/2014 at 03:29 PM in Barack Obama, Books & Media, Congress, Current Affairs, Economics, Electoral Prospects, Georg Thomas, Media/Media Bias, National/International Affairs, Presidency, U.S., Presidential Race--Then and Later, Pure Politics, Social Philosophy, Socialism Gone Wild, Taxes and Spending | Permalink | Comments (0)
| | | |