Sorry, Nick, but if you give Literature R Us an opening for a cheap shot, we’re going to take it. Nick incautiously let his guard down last month with a post in Reason, “The Libertarian Movement Needs a Kick in the Pants”, in itself a riposte, as it were, to Tyler Cowen’s thought-, if not indeed outrage-, provoking initial volley via “Marginal Revolution”, “What libertarianism has become and will become — State Capacity Libertarianism”. As Tyler put in his opening paragraph,
Having tracked the libertarian “movement” for much of my life, I believe it is now pretty much hollowed out, at least in terms of flow. One branch split off into Ron Paul-ism and less savory alt right directions, and another, more establishment branch remains out there in force but not really commanding new adherents. For one thing, it doesn’t seem that old-style libertarianism can solve or even very well address a number of major problems, most significantly climate change. For another, smart people are on the internet, and the internet seems to encourage synthetic and eclectic views, at least among the smart and curious. Unlike the mass culture of the 1970s, it does not tend to breed “capital L Libertarianism.” On top of all that, the out-migration from narrowly libertarian views has been severe, most of all from educated women.
Okay, I’m not really sure what a “hollow” flow is, but you get Tyler’s drift: libertarianism is running like a dry creek. Not only that, it’s getting harder and harder to meet chicks, particularly smart ones.
Nick’s response, in brief, is that something is ailing us libertarian folks, for sure, but “State Capacity Libertarianism” ain’t the cure, and I would agree with Nick on both counts, though as a non-libertarian I’m not all that impressed with his “cure” either, or his vague call for giving this whole thing a lot of thought.
There are a lot of other libertarians who were apparently riled by Cowen’s piece, and are no more excited by “state capacity libertarianism” than I am, which does sound a lot like “dynamic centralism”, or perhaps “centralized dynamism”, a sort of whiling around a poorly defined armature to little effect.
Additional skeptics included Ilya Somin, of the “Volokh Conspiracy”, who blossomed forth with two intelligent critiques, “Tyler Cowen on "State Capacity Libertarianism" I: Is it the Wave of the "Smart" Libertarian Future?” and “Tyler Cowen on "State Capacity Libertarianism" II: Is it the Right Path for Libertarians to Follow?”, answering “no” on both occasions.
Somin helpfully links to additional replies to Cowen in both his articles, and I have, to my credit, I must say, since I’m not a libertarian, read all of them, finding Jeffrey A. Tucker’s “If Libertarianism Hollowed Out, Why?”, which can be found at the website of the American Institute for Economic Research, to be the most interesting.
I particularly liked Jeff’s piece because he was the only one to expand a bit on Tyler’s brief reference to “less savory alt right directions, to wit:
Even at the time [when interest in libertarianism was, you know, flowing], I suspected that it was a bubble. It was as early as 2008 when I first saw a YouTube of some rally of political activists claiming to be libertarian. The message was all about taking the red pill, screamed from podiums. The ethos was populist anger – a purely negative message about who we hate and why. There was something about the aesthetic that bugged me: the rationality, calm, and social feeling that Ludwig von Mises said must characterize the liberal movement was all but absent. It didn’t feel right. I was glad not to be part of it. But I wondered what this hot mess would become over time, after their savior [Rand Paul, I guess] failed to gain power.
Frankly, everything about an aesthetic that consists of screaming about taking the red pill bugs me, but, well, I’m not a libertarian. Even Jeff doesn’t bother to ask himself where this “populist anger” came from, and, clearly, doesn’t bother to notice that much of the appeal of libertarian ideas has been about “who we hate and why” for a long time. Reading the comments page from Reason’s “Hit and Run” page, it’s easy to guess that at least half the people who say they hate “big government” really hate only “welfare”, and, in fact, only hate those welfare programs that help the people they hate, those goddamn illegal immigrants and those goddamn blacks (only the lazy ones, of course). The rest of the supposed libertarian agenda—free trade, unrestricted immigration, elimination of budget deficits, restrictions on arbitrary governmental power, even free speech—none of that seems to matter much any more. “Big stick” government is in, the bigger the better, as long as Donald Trump is swinging it.
In the past, principled libertarians—like the ones who write for Reason—were always infuriated by the charges leveled by mainstream liberals like Jonathan Chait and Paul Krugman that libertarians were racists. How embarrassing to find out that the damned liberals got it at least half right!
It was Barry Goldwater and Ronald Reagan, of course, who “weaponized” libertarian ideas as a way of attacking the whole liberal effort to integrate American society, an attack that lacked traction until the brutal race riots of the late 1960s, and the massive increase in violent street crime committed by blacks (often against one another, of course) that followed, coupled with efforts of the federal government to overcome “covert” segregation in the North, particularly related to housing and employment. Although Barry and Ronnie always talked about how they hated all "big government", in practice they limited their attacks to programs that only helped “them”, and not those that helped “us”, like Social Security, Medicare, agricultural subsidies, etc., and lesser hypocrites like Newt Gingrich and Paul Ryan followed in their wake.
Yet the transformation of small government libertarians into blood and soil True-Trumpers, depressing as it must be, is only half the problem, and in fact the lesser half. During the recent unpleasantness, also known as the Great Recession, libertarian economists—the University of Chicago “fresh water” school, more or less—were unanimous in their assertion that President Obama’s Keynesian fantasies were going to turn us slap damn into Greece, without a doubt. Reason in particular ran endless doom n’ damnation pieces throughout Barack’s first term, with a protracted diminuendo running throughout his second, pretending not to notice that in fact the U.S. came through the Great Recession in better shape than virtually any other major economy. Worst of all, even with the economy approaching full employment, Trump massively increased deficit spending, as everyone knew he would, and the big crash never came, and still hasn’t come. And, as grumpy Paul Krugman continues to point out, “fresh water economists”, as he likes to call them, have never bothered to ask themselves why and how they got it so wrong for so long. The answer, of course, is that they can’t bear to admit that they got it wrong—and, in fact, none of the libertarians whose discussions I’ve reviewed for this piece have dared to wonder if the “hollowing” of their movement might be due at least in part to the fact that they don’t seem to know what they’re talking about.
Of course, if they had asked themselves why they got the Great Recession so wrong, they would have run smack up against the most interesting, and most vital, question of all: Is libertarianism “true”? Because if it is true, the fact that libertarian candidates routinely get trounced at the polls, or that educated chicks at parties won’t give you the time of day, is irrelevant. Truth is just truth, n'est-ce pas? You can’t argue with truth. Since they didn’t reach that question, I’ll have to answer it for them.
My answer is that libertarianism isn’t true, that the notion that there are immutable economic laws enshrining “natural rights” is false. There are no such rights, and no such laws, laws that, libertarians imagine, if allowed to function unimpeded would automatically create ever-increasing prosperity—a world, where, pace Dr. Pangloss, everything really is for the best in the best of all possible worlds, a world where “defying” the laws of economics is like trying to defy the laws of physics: you land flat on your ass. Unfortunately, it was the libertarian fantasy that free markets are inherently self-policing that landed flat on its ass in 2008. The mass insecurity that the market collapse and subsequent Great Recession have spread around the globe have prompted the most unfortunate popularity of both the “nationalist socialism” of Donald Trump and the “socialist socialism” of Bernie Sanders here in the U.S. and even more unfortunate authoritarianism abroad.1
I don’t believe there are “natural laws”—because if there were everyone would agree on what they are, and nobody does. I don’t believe there are any natural rights that precede the organization of society, rights whose defense are the purpose of government. Private property, the “god” of the libertarians, is the creation of government, and, prior to government, had no meaningful existence, determined only by the “right” of the stronger. In other words, Mr. Jefferson, with his supposedly “self-evident truths”, got it wrong, and so have his followers.2 As the frequently but not always wrong Jonah Goldberg has argued, in his both fatuously and dubiously titled tome, The Suicide of the West, “Capitalism is unnatural. Democracy is unnatural. Human rights are unnatural. God didn’t give us these things, or anything else. We stumbled into modernity accidentally, not by any divine plan.”
The odds are extremely high that formal governments, coming into existence thousands of years ago, had as their purpose the institutionalizing and perpetuating of a conquest of one group by another, for, as the history of empires throughout all “pre-modern” history indicates, conquest paid. And the arts of civilization, such as writing, arithmetic, architecture, painting, and sculpture, were largely created to either finance (by keeping track of who owed what) or glorify a tiny ruling class, usually clustered around a ruler considered at least semi-divine.
The “dream” of libertarianism is enticing, because free markets—painfully out of fashion these days—really are one of the greatest human inventions of all time. Free markets, coupled with modern science, are the great source of modern prosperity, the only force in history that has allowed the great majority of human beings to live as “human”, that is, free to live lives largely uncoerced by want or disease.
Not only are free markets wonderful, government is often terrible—constantly interfering, always threatening to kill the goose to get at the golden eggs, constantly enabling rent-seeking and, most of all, engaging in rent-seeking on its own account, for the first goal of every bureaucracy is its own perpetuation and indeed expansion. Wouldn’t it be wonderful if we didn’t need government at all?
Yes, it would. But none of these articles dares to directly confront the issue of the validity of the libertarian “construct”. The whole point of what I might call “hard libertarianism” is that human civilization is ultimately built on the notion of contract: people working out agreements of exchange that are mutually satisfactory—because otherwise why would they make them?—what Adam Smith called humanity’s natural “propensity to truck, barter, and exchange one thing for another”. This propensity Smith declared to be uniquely human—suggesting, in fact, that it makes us human, an argument whose recent restatements were summarized by Dan Sanchez, writing at the Foundation for Economic Education, “Trade Is What Makes Us Human”, citing recent books by Yuval Noah Harari (Sapiens) and Matt Ridley (The Rational Optimist: How Prosperity Evolves). Friedrich Hayek’s immensely influential argument that the exchange of information via free markets automatically creates order out of chaos—related, of course, to Smith’s equally famous “invisible hand”—is cited endlessly by libertarians in opposition to any government planning today. The problem is, Smith cheated, putting the bunny in the hat, as lawyers like to say, and all the subsequent libertarians cheated as well.
Smith’s “propensity” probably goes back, in rudimentary form at least, for tens of thousands of years, even before the agricultural revolution. But such activity is not at all the same as a true free market, as Smith, and his followers, slyly encourage us to believe. All of history points us in exactly the opposite direction. Slave markets go back at least 5,000 years, in every “classical” civilization, but free markets never appeared anywhere on earth until sometime in the late fourteenth century, or maybe a century or two later, depending on how you slice it, and only along the English Channel, between England and the “Low Countries”. Here, and only here, were markets with large numbers of buyers and sellers, dealing in basic commodities like grain, cloth, timber, salt, and (perhaps) preserved herring. Free markets expanded in Europe and eventually spread across the Atlantic in North America, but this never happened anywhere else in the world until very modern times, because the Europeans took advantage of their unique power to establish empires—considered the “true” source of wealth at least until World War I—whose precise purpose was to prevent free markets, via exploitation—the colonies would “sell” raw materials and agricultural products at prices set below the true market value by the “mother” country and buy finished goods from “home” at above market prices. Dealer wins and winner deals!
One of the many things I did not think about in high school was economics, and yet, remarkably, I believe I managed to come up with a pretty impressive economic thought, all on my own, to wit: Why didn’t Aristotle write The Wealth of Nations? After all, the Stagirite was interested in everything else. Why not economics?
Because there wasn’t any. Back in 1970, the illustrious classical historian Moses Finley wrote an influential book, The Ancient Economy, arguing that, regardless of all the barter, truck, and trading that occurred in the ancient world—perhaps most spectacularly in Athens, the city of trade par excellence—easily surpassed in longevity by Venice but not in cultural importance3—the vast majority of economic activity was kept firmly under the control of landowning elites, who usually though not necessarily formed a military elite as well. In 1990 a group of scholars contributed a follow-up, The Ancient Economy Revisited, filled with interesting essays, not to mention a map showing all the olive presses in Roman Africa, all saying basically, that yes Finley got it right.
Milton Friedman’s famous statement, “The greatest advances of civilization, whether in architecture or painting, in science and literature, in industry or agriculture, have never come from centralized government,” got it almost precisely backwards. Until the emergence of the Dutch “bourgeoise” prosperity in the mid 17th century, almost all of “civilization” was the product of “centralized government”—virtually all the great architecture, painting, science, and literature was done under the direction and patronage of either “centralized government” or organized religion or great landowners, all three benefiting from mandatory financial payments—taxes, tithes, rents, fees, etc. Even the Dutch prosperity was largely dependent, not on the free market, but overseas monopolies in the East and West Indies, won and maintained by military coercion, and often dependent on slave labor—and the slave trade itself was, of course, quite lucrative and endlessly fought over. One can point out that the White House, Monticello, and Mount Vernon were all built, at least in part, with slave labor. Even Friedman’s beloved (one assumes) University of Chicago was and is dependent on “centralized government” because of the special privileges it enjoys as a non-profit corporation (exemption from taxation, ability to receive gifts that reduce the donors’ tax liability, etc.), privileges that are not at all “natural”, only assumed to be so because they are result of centuries of empirical cultural experience. Learning has always been subsidized, and no doubt always will be.
Finley’s arguments in The Ancient Economy have been greatly expanded in a recent book by Walter Scheidel, a professor of ancient history at Stanford, published Escape from Rome: The Failure of Empire and the Road to Prosperity, to include the entire classical world, arguing that all the great non-European civilizations of the world—China, India, Persia, the Byzantine, the successive Moslem empires of the Middle East, and the Meso-American empires as well—prevented the development of free markets through taxation, confiscation, and regulation. Whatever achievements these cultures produced were, almost invariably, the products of “centralized government.” In all cases, the system “worked” in that it allowed the existing elites to remain in power, which is all they ever cared about. That no empire ever escaped from the Malthusian trap, well, the poor were supposed to be poor! That was the way God wanted it! It kept them in line!
According to Scheidel, “Europe” was unique in being unlikely, in geographical terms, as the site of an empire. The Romans made it happen against the odds, but no successor state even came close. It was Europe’s division, the good professor says, that, preventing oppressive consolidation, set the stage for competition between states that encouraged rather than suppressed experimentation and innovation, allowing “progress” to happen as it could not have happened anywhere else, and did not happen anywhere else, using a large number of counterfactual “thought experiments” to bolster his case—pointing out, for example, that, since Roman times, no European “conqueror” came close to dominating Europe, and, in fact, the two “pan-European” empires, of Napoleon and Adolph Hitler, collapsed in a mere matter of years, whereas, in other regions, the opposite was the case. Dynasties rose and fell, but a system of strong, independent, competitive states never arose.
Scheidel barely mentions many of the “traditional” explanations for the “Rise of the West”, including the secularization of learning during the Renaissance, the invention of the printing press, the Protestant Reformation, or “Arabic” numerals, introduced to the West by Arab scholars but actually originating in India. However, he does give substantial weight to one factor that many other scholars emphasize as well, the vast influx of gold and silver from the New World extracted by the Spanish conquerors. But for this great unearned treasure, Scheidel contends, western economies probably would not have developed much further than the rest of the world, remaining stuck at the “Smithian” levels of development—that is, the sort of economies prevailing in Europe and Asia when Adam Smith wrote his famous work. All the “progress” that we so largely take for granted never would have happened—free markets never would have happened—and the whole world would still be stuck in repetitive Malthusian cycles.
This, to me, undersells the uniqueness of western civilization at Smith’s time. After centuries of thinking that “the West” defined “Civilization” with a capital “C”, there is a tendency to move in the other direction and assume that it was only the Industrial Revolution, and the steam engine in particular, that moved the West “ahead”, a sort of “good taste” that goes out of its way to praise non-western civilizations, and China in particular. Yet if there had been no “New World”—whose discovery Smith himself regarded as the most important event in the history of humankind—by Scheidel’s argument, at least, there might have been no Adam Smith.
It was the unique advantage Spain obtained through its equally unique overseas empire that ultimately resulted, one can argue, in the existence of economics as a field of study. Other nations sought both to emulate and despoil Spain. The real pirates of the Caribbean—about whom libertarians wax so strangely romantic4—were largely English, French, and Dutch sailors tacitly encouraged by their respective governments to steal as much Spanish gold as they could. The Dutch, breaking away from the rule of the Spanish Hapsburgs, who also ruled Portugal, conquered much of Portugal’s overseas empire, while first France and then England provided support for Portugal’s successful effort to free itself from Spanish rule. As the Dutch supplanted Spain as the most affluent of European empires, without attempting to lay claim to large territories, both England and France sought to despoil their empire as well, leading to three Anglo-Dutch wars, followed by a long series of wars conducted by the France of Louis XIV against an Anglo-Dutch coalition that ultimately resulted in the defeat of France and the triumph of England, with the Dutch being too weakened to ever again aspire to the role of a major power.
It was this struggle for power, the efforts to discover the “secrets” of first Spanish and then Dutch prosperity—the 17th century Dutch in particular often regarded as the first society to achieve “bourgeoise” prosperity—that led to the “invention” of economics—the study of the wealth of nations. The French physiocrats, who were Smith’s forerunners and the fathers of laissez-faire, developed their theories in opposition to the policies of Jean-Baptiste Colbert, Louis XIV’s minister of finances, who sought to force the French economy to mimic Dutch prosperity, though, appropriately enough from the libertarian point of view, almost all of Colbert’s schemes were failures, though Louis certainly deserves some of the blame for his addiction to war. Colbert wanted to emulate the Dutch, while Louis wanted to conquer them.
Smith was writing during the heyday of “natural law”—The Wealth of Nations was published, appropriately enough, in 1776—concepts that are, of course, enshrined specifically in the Declaration of Independence and implicitly in our Constitution, which has encouraged the growth of “libertarian law”, particularly constitutional law, aka “originalism”, aimed at “proving” that Smithian/Hayekian (and, what the hell, Friedmanite) concepts make up the warp and woof of the Constitution, and thus also proving that almost all the “liberal” legislation enacted since the advent of FDR’s New Deal is unconstitutional. The only problem with this “theory” is that, as I said earlier, there is no natural law. (In the “hard” version of originalism, it doesn’t matter if natural law is true or not. The “Founders” thought it was, and we are bound by their thought, even if it’s wrong, as we are bound by their primitive views on race and sexuality—though not, apparently, headdresses.)
In fact, the “theory” of natural law was invented, like all “laws”—for as Burke said, “art is man’s nature”—invented as a result of the enormous political-religious-cultural power struggles set off, principally in western Europe, as a result of the Protestant Reformation, and as a result of the ultimate failure of either the Protestant or Catholic confessions to triumph over one another, which ultimately convinced “thoughtful” men like Hugo Grotius, Thomas Hobbes, Spinoza, and John Locke, that revealed truth, on which western civilization had depended for a good 1500 years, was no truth at all. If there was “truth”, it lay beneath.
Locke had to “prove” his contract theory, resting on natural law, by first refuting the notion that government rather obtained its sanction from divine law. As his fairly well known, the first of his famous Two Treatises of Government is a literally line by line “refutation” of Robert Filmer’s Patriarcha, or The Natural Power of Kings, which argued for the theory of divine right favored by the Stuart kings of England, who were being in the process of being forced out because James II’s unrepentant Catholicism was unacceptable to the great mass of the English people.
Government by contract was common in Europe at that time. Many kings were elected rather than “ascending” by birth, and they were usually forced to sign contracts guaranteeing that they would respect the “ancient liberties”, whatever they were, of the “estates”—always the aristocracy and the “church”, whatever it was, and sometimes the “people”, in the form of the tax-paying bourgeoise (people who didn’t pay taxes weren’t people). But Locke, and others, invented a state of nature in which society was created, for the first time, by hitherto solitary humans, to better protect their interests, among them being life, liberty, and property. The fact that, for thousands of years, and all around the globe, men had actually lived under arbitrary rulers whose authority was regarded as at least semi-divine didn’t matter, just as the free markets soon to be imagined by Adam Smith were a very minor exception to a generally oppressive rule.
Of course, these “imaginary” markets proved in fact one of the very greatest , and most powerful, ideas in history, and I am confident that the current infatuation on both the left and right with “managed” economies will fall by the wayside in time.5 Liberalism was denounced for almost the entirety of the twentieth century, only to triumph over the virulent monstrosities of both fascism and communism, and the bungling inefficiencies of democratic socialism, though I am certainly hoping to be spared both another world war and a massively wasteful and corrupting 40-year arms race. “Thatcherite-Reaganite neoliberalism”, so despised today, will, I think, emerge anew, but with more respect for, yes, John Maynard Keynes and his successors. Libertarians need to recognize that their beloved private property, which is indeed necessary to freedom, is still a construct, a creation and product of government, rather than a somehow “pre-existing right”. In a real state of nature there is no right but the right of the stronger, and the weak have no rights at all.
Afterwords
Two of the leading advocates for libertarian thought are the Reason and Cato Institutes, both funded by those leftist bêtes noires, the Koch Brothers. Both institutes do excellent work, and I’m glad the Kochs fund them, but sometimes, I think, the brothers get it wrong. The Kochs first got into partisan politics in a big way after the Bush administration pushed through the expansion of Medicare to cover prescription drugs prior to the 2004 election. The Kochs were supposedly horrified by an unfunded increase in federal spending of about $70 billion a year. Yet in the first year of the Trump administration, the Koch organization actively, and successively, lobbied to turn Paul Ryan’s supposedly revenue-neutral tax “reform” package into a budget buster that added over $150 billion a year to the federal deficit. The Kochs objected to the taxes Ryan planned to add to balance out the cuts. Well, fine, but why didn’t they propose alternatives if they were so concerned about the deficit? And why didn’t Ryan refuse to pass the bill without equivalent increases if he was? Because neither “conservatives” nor libertarians were ever really concerned about deficits, but only who would benefit? Common people bad, rich people good? Makes you think, doesn’t it?
For a nice libertarian take on economic history, try Vincent Geloso’s Five Great and Recent Books on Economic History for the American Institute for Economic Research, which is both recent and excellent, even though I disagree with a lot of his conclusions.
1. Bernie would be a disaster as president, because his ideas are so terrible, but he wouldn’t corrupt our government the way Trump is doing, because he isn’t personally unscrupulous and blatantly authoritarian, the way Trump is.
2. What does it mean to “hold” a truth to be self-evident? If it’s actually self-evident, you don’t have to announce it to be so. One can also mention the “self-evident truth” so self-evident that Jefferson forgot to mention it: that men and women are not created equal.
3. The freedom that some of the citizens of these famous cities enjoyed was heavily subsidized by conquests abroad. Athens also drew on wealth from silver mines, worked, of course, by slaves.
4. Libertarians talk, a lot, about the “rule of law”. But pirates lived by theft, rape, and murder. What’s “libertarian” about that?
5. Free markets, after all, have “deep pockets” defenders (most of the time). The prospects for resistance against the appetite, again, both on the left and right, for “managed free speech” is, sadly, less assured.
