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The Role of Government, 2

A few centuries ago people in Europe discovered free trade. The market. They got the state to say: go make money, free of any guilds or regulations.  I won’t stop you. Go out there and make money. Compete freely. So people went to make money. Started businesses, factories, mines. In short order we got 2 industrial revolutions, the greatest technological advances in history, and vast, vast, amazing amounts of wealth. Pretty neat.

But. We also found the market isn’t perfect. Yeah it produces wealth. A damn lot of it. But leaving people alone to make money also resulted in other outcomes which weren’t so desirable. For some people, at least. You see, people compete to make money, and the competition can get ruthless, so people start doing bad stuff. These undesirable outcomes ended up being called “market failures”. There’s a whole literature about that. Externalities. Monopoly. Sweatshops. There’s lots of stuff, it isn’t quite clear what is and what isn’t a market failure; but the consensus out there is that there are quite a lot. And that the government should use its power to regulate the market in order to prevent and/or fix market failures. Again, it’s messy business, as tends to happen with government stuff, but that is how it works today. And it doesn’t work that badly. We got clean air and stuff. Which is nice.

So let me do this analogy:

A few centuries ago people in Europe discovered civil rights. Democracy. They got the state to say: go, be free of all legal restrictions in status. No more nobility or medieval ties. You are all citizens, get into politics. I won’t stop you. Go out there and say and read and assemble as you wish. Compete freely. So people went out there and started to do what they wished. Started newspapers, political parties, clubs. In short order we got a dozen liberal revolutions, the abolition of all hereditary privileges, universal suffrage, equality before the law. The first East Asian visitors to Europe in the late 1860s saw how cargo was transported by animal-drawn carts,  never by people, and wrote: pretty neat. This white guys treat men like men, not like animals. The shock killed Confucianism in a decade.

I digress. And there is no but. Only a small minority of reactionaries ever protested against this. Civil rights only got bigger, deeper. The free market produced much wealth. Free societies also produced much good stuff. But surely free societies have also resulted in undesirable outcomes. You see, people compete in society, competition can get ruthless, and people do bad stuff. We might call that social failures.

Surely low natality is a social failure? The education bubble? Youth unemployment? High criminality? Ugly art and architecture? You name it. All caused by the same thing that causes market failures. Competition run amok; too little oversight. Too much competition makes ruthless people take the upper hand, and the little people suffer.

Libertarians have this dream about the market which self-regulates. The market is just Human Action. Well, to a point. The market doesn’t care about what humans want long term. If it did there wouldn’t be Capitalist accelerationists who openly cheer for Skynet.  So it stands to reason that public force is to be used to correct some market outcomes produced by too much economic freedom.

Libertarians also have this dream about society itself, which self-regulates. Hayek pontificating against social engineering. Well, to a point. If society self-regulated perfectly no people ever would have gone extinct. And there’s a ton of social equilibriums, which we may or may not like. Not sure if I want lip plates as standard fashion. So, it stands to reason that public force is to be sued to correct some social outcomes produced by too much social freedom.


30 responses to “The Role of Government, 2

  1. Pingback: The Role of Government, 2 | @the_arv

  2. dnarby May 15, 2017 at 02:32

    “So, it stands to reason that public force is to be sued to correct some social outcomes produced by too much social freedom.”

    Where do you draw the line? Or are you arguing “some animals are more equal than others”?

    FYI the only proper role of government is to PROTECT PROPERTY.

    And EVERYTHING is property.

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  4. Nulle Terre Sans Seigneur May 15, 2017 at 06:39

    The libertarian would of course say to you that (following Franz Oppenheimer) political entrepreneurship and market entrepreneurship are categorically different things.

    It’s kind of funny that people complain about monopoly and sweatshops so much. Not only were chartered monopolies once facts of life, but Tudor poorhouses weren’t exactly light work. Overall, they seem to occur with less frequency in capitalized economies.

    I otherwise agree, though. The trick is how to create “endogenous” interventions, ones that adjust themselves to the planning horizons and calculations of market participants themselves as opposed to being extra-economic barriers. This is very tricky indeed in a regime where equality before the law has been made a rule.

    • Michael Rothblatt May 15, 2017 at 13:21

      It’s rather bizarre to hear reactionaries go all “muh workers,” when absolute monarchies did all in their power to screw the workers–from chartered monopolies, to importing cheap foreign labor, to maximum wage laws. A High Tory in power would go hyper-progressive on the economy. Instead of providing regulatory capture to big businesses while providing a lip service to markets, a High Tory would grant monopolies to corporations directly, given that corporations provide means of socialization of capital, and of social control both.

  5. iI May 15, 2017 at 07:24

    Society self-regulates like the jungle does.

    Surely low natality is a social failure?

    Why and how? This merits something more than that “surely.”

    The education bubble? Youth unemployment?

    Largely the two sides of one coin.

    High criminality? Ugly art and architecture?

    Criminality has consistently dropped… that is, for Asians, Jews and Whites.

    You say ugly art and architecture (isn’t architecture one of the arts?)
    Science, philosophy, … all have gone downhill.
    There was great faith behind all greatness. There can be no greatness, besides destructive greatness, if the ground is the faith in nothing (≠ no faith! A void of faith would be filled quickly. Faith in nothing won’t be replaced quickly or easily.)

    You name it. All caused by the same thing that causes market failures. Competition run amok; too little oversight. Too much competition makes ruthless people take the upper hand, and the little people suffer.

    • Jefferson May 15, 2017 at 13:02

      Wasn’t it competition that made beautiful art, not faith?

      • Jefferson May 15, 2017 at 13:04

        And today’s humans don’t believe in nothing, they believe in themselves. Ego worship is the end result of competitive religion.

        • iI May 15, 2017 at 18:23

          Do the ego worshipers look in great shape, genuinely happy/at peace with themselves… is theirs a positive religion/faith?

          Why does an ever higher number of them run on psychotropic medications? (Yes, I know Big Pharma pushes doctors to give those, but it’s not only that.)

          We can say that even an ordinary upper middle class folks want no offspring in order to pay all their resources (time and money) to ego worship.
          But what about people like nations’ presidents? Hired people could care for their children, if they wanted to have… they wouldn’t be troubled at all, in any way. And still… see the recent post here.

          When everywhere you look you see people neurotically hammering on how “happy” they are, it means their deep egos are aghast.
          So, ego worship is a last resort against the ghastly feeling of universal nothingness..

          We know the girls girl-women posting on how they love their hubby all over social media are usually the unhappy beta-paired, don’t we. It’s just compensation and a defence-mechanism too, and so is for ego-worship.

          Nobody in the first and second world has any idea of what to be happy feels like any more, and least then all that woman posting about her travels to many different countries the blog owner posted about earlier.

          Of course there are very contended simple-minded people, but those aren’t the hardcore worshipers… these one just feverishly compensate.

      • dfordoom May 16, 2017 at 03:58

        Wasn’t it competition that made beautiful art, not faith?

        Do you have some examples to back up that rather extraordinary assertion? It seems to me that as the art market has become more competitive art has become more and more ugly and crass.

    • spandrell May 15, 2017 at 14:20

      If I have to spell out how sub-replacement natality is a bad thing you’re in the wrong blog.

    • rcglinski May 15, 2017 at 16:37

      – Why and how? This merits something more than that “surely.”

      “In the long run we’re all dead” is supposed to be a quip, not a fact.

  6. Jefferson May 15, 2017 at 12:57

    These seem like separate categories, but technological ratcheting and social ratcheting seem linked. A human peasant slaving away on a farm can’t bash his brain against a social ratchet. Density seems necessary for a ratchet of either type to really get moving, and seems to create a feedback loop. I suppose I’m skeptical that any government can impose limits on social competition, since so few people seem capable of even noticing how dangerous these competitions are.

    • spandrell May 15, 2017 at 14:27

      Pre-liberal governments used to put all kind of limits on social competition. In China the government mandated the clothing and hairdo of every single subject.

      It is not hard knowledge; we’ve just forgotten about it.

    • Michael Rothblatt May 15, 2017 at 17:12

      >These seem like separate categories, but technological ratcheting and social ratcheting seem linked.

      Seems kinda obvious that economic liberalism and cultural liberalism don’t go hand in hand. It’s kinda stupid to waste pecious economic capacities on stuff like antiretrovirals and sexbots.

      >I suppose I’m skeptical that any government can impose limits on social competition

      Government shouldn’t impose limits on social competition. It should use it to its advantage. Set the things that are high status according to the direction in which it want to move the culture, and watch the status competition do its job for it. For example, if parenthood were high status, there wouldn’t be sub-replacement fertility.

  7. Michael Rothblatt May 15, 2017 at 13:07

    Actually libertarians would say two things. First, they would deny the possibility of perfect markets, and thus would call some of the failures the least possible evil (e.g. they would say that sweatshops beat begging and prostitution). Secondly, the rest of failures they would attribute to the state, and not markets, for example, they would say that pollution is the failure on the part of the state to protect the property rights. There was that anti-libertarian meme that had a libertarian wanting to nuke his neighbor because leaf blew on his backyard from their neighbor’s backyard. So “self-regulation” is really not self-regulation. It’s microabsolutism.

    • spandrell May 15, 2017 at 14:25

      Libertarians become a cult when they start to play with definitions and imagine a fantasy legal regime where air is privatized. It doesn’t work like that, it never will. I see no need to address the nitpicks of every single wacky cult in the universe.

      • Peter George Stewart June 29, 2017 at 06:34

        I think the libertarian/ancap reply to some of your comments about market failure would be that yes, market failure occurs, but government intervention in the economy in order to solve market failure problems inevitably either prolongs them or makes them worse, and is itself a worse kind of market failure, partly because the State is itself usually the biggest monopoly in the economy. (In economics, qua science of human action, “Market failure” is a metonym, it really applies to bad collective results that come about as a result of the pursuit of individual rationality – your “ruthless competition” – in some cases. Market failure in the actual market is a subset of that broad category, but so is government failure.)

        The free market (as a spontaneous order, the product of human action but not of human design) is like weather, sometimes the weather wreaks havoc, so we have to have some safeguard against that; but for the poor and low-skilled/low-earning (to take them as the ostensible primary concern of much government intervention as a result of market failure), the safeguard should come from, e.g. collective pooling of resources and the creation of self-organized hedging systems (welfare, medical, etc.) – a kind of non-commercial insurance, which is socialist and self-governing at a local level. The development of that kind of parallel social institution to the market is what things like unions and friendly societies were all about in the middle of the 19th century before they got hijacked by Marxists as the vanguard of their silly “revolution.” (There was also a tie to the “social glue” aspect of religion at that time, of course, which helped such forms of self-organization get going.)

        If you’re going to have such a thing as monopoly government at all (and it’s likely to be necessary for a while longer, we’re certainly not psychologically ready for ancap yet, as a species), what it should be doing is facilitating that naturally-arising spontaneous collective safeguarding process (i.e. it should be helping along something that’s going to want to be happening anyway, that people will generally be starting to mobilize themselves to do anyway), rather than trying to fiddle with the market to prevent market failures from happening in the first place (again, because that will always, always, always and inevitably, lead to worse results, often prolonging the problems or making them worse, plus on top of that, it will expand the power of the state, multiply regulations, etc., etc.).

        Almost all government intervention in the economy is counter-productive – but the proposal to engage in it buys votes. It’s that process rather than any genuine need for government intervention that has led to fiat law involvement in economics (as opposed to a much leaner but much stricter regulation qua game rules for genuinely free competition).

        I’m not absolutely gung-ho about this counter-argument, I just lean towards it – I’m just presenting it as what I think would be the general lines of argument in response to your justification of the received wisdom re. the reasons for laissez faire falling out of fashion.

        • spandrell June 29, 2017 at 13:06

          I know this argument, of course, and they have a point. But ancappism is a freak cult. When you’re saying things like “humanity is not psychologically ready yet” you’re doing something seriously wrong.

          The point of market failures is that humans are political animals, and they will always form coercive organizations that hold values which conflict with the market. That’s human nature, and I don’t see why the market is the good part of us while the state is the bad one. We don’t get to choose. Humanity is a package deal.

          • Peter George Stewart June 30, 2017 at 00:13

            Oh yeah, it’s a package deal in that the “rules for rulers” stuff, the SP stuff, demographics, etc., are as operative in the market case as they are in the government case; but so is the logic of instrumental rationality (economics in the broadest sense) as operative in the government case as it is in the market case.

            The myth of “legitimacy” is really the root of our cognitive dissonance in that, while we see quite clearly that monopoly is bad in the case of the market, somehow we are persuaded that it makes sense in the case of government.

            I guess I’m still a universalist humanist at heart, still of the Left at heart – just somewhat chastened and humbled by NRx/Dark Enlightenment reflections. So much so that when I go back and talk to my people, for whom I pass the ant-smell test, I present the aspect of a swivel-eyed Cassandra speaking in tongues :)

            IOW, as a result of encountering NRx/DE, I now think of universalist humanism as more like a narrow “re-entry corridor” type of thing, that we might easily miss, rather than as some inevitable tide that’s sweeping us all along.

            • spandrell June 30, 2017 at 00:41

              We are persuaded that it makes sense in the case of government because there’s a lot to gain by being persuaded. You may not be interested, but some guy is going to take that offer and end up with way more status than you; and so, in the long term, the odds are people will all end up very persuaded of the “legitimacy” of stationary bandits.

  8. rcglinski May 15, 2017 at 16:51

    I think you’ve got a really good point here. We have a word (perhaps unfairly derogatory) for someone who thinks any free market outcome is a good outcome because it’s free market, libertarian. Yes, I know the self-described libertarians would call that an unfair caricature, and sure, yeah, that’s true I guess.

    Anyway, what derogatory term do we have for someone who thinks any free political outcome is good because it was free political?

  9. Dave May 15, 2017 at 17:22

    I see the “free political market” as a circus used by those who hold actual power to distract and mollify the mob. What we actually have in the West is a vast, unaccountable bureaucracy that sits behind a “free political market” circus. Actual government policy is affected by the circus only highly indirectly. The circus is used by the bureaucracy to legitimize policy (“the people voted; elections have consequences, etc”)

    Yet the bureaucracy are not movers; unmoved. In the long run the mob does rule through seeding the next generation of bureaucrats. Venal behaviors move from tolerated to normal to expected.

    Perhaps this is what Moldbug was getting at with his Antiversity idea – what is needed are more moral people seeding a more moral bureaucracy. Such a bureaucracy could bend the “free political market” circus toward more virtuous rather than more vicious behavior. Such bureaucrats would need to be well selected and rigorously proven in their morality and capability. Moldbug’s idea was to just build it and have the people beg to empower it.

    • iI May 15, 2017 at 18:35

      (Moldbug and the Antiversity): in Moldbug model, the circus is shut down altogether. He (I think correctly) believes that, as long as the circus is open, nothing politically “worthy” can come.

      (The “actual power holders”-mob relation):
      In 1996 a paper was published, Ritual Deception: A Window to the Hidden Determinants of Human Politics.

      It might be an illusion that the high-ups rule and the rest is ruled against their will.
      The real rulers are the embodiment of all traits the majority of people admires/would like to have.
      In making the populace obey, they obey the populace’s deep (and unconscious!) desire to be made to obey (by who are the best at grabbing power and deception, that is).

  10. Anonymous May 16, 2017 at 15:37

    “animal-drawn horses”

    Now I’m imagining a pair of oxen dragging a dead horse.

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