Sunday, November 30, 2008

The Two Problems of Thought—Its Content and Its Ideologic Framework

I had another of those discussions, this time with my very liberal neighbor, that topic hops and usually degenerates into argument in which no matter what attempt at clarification one pursues, it seems impossible to agree on any definitions that would distinguish between the Republicans and Libertarians. Apparently for him there are just two categories of political thinking, those policies he and the good guys hold who are Liberals and Obama supporters, and then those anti policies of all others who include those right wing Conservatives, Republicans, Cascade Policy Institute, Libertarians, and the Bush administration. It might seem his position—composed as it is of loose collections of policies based on vague notions without rational definitions— might simply be due to the fact his life is taken up with far different interests and a job that has nothing to do with policy analyst.  He clearly has no time to become a scholar in political economy. Perhaps these definitions rest on such subtle distinctions that they escape ordinary citizens.
But sometimes we find serious scholars who also conflate the various ideological frameworks into the same sort of two-category classification of Liberals and all others. They also lack rational definitions in their analysis. But first, we should be clear in our own definitions.
Definitions aren't some esoteric form of advanced thought; children naturally begin using them during their elementary school years. Definitions are elementary descriptions of classes of objects that consist of a genus and specific difference—defining a noun by its inclusion in a class of objects and naming those specific properties it possesses that distinguish it from the other subclasses: "a fork is an eating utensils with tines."
So, to define political though is simple. Today's liberalism is a pro-government form of thought that believes in the values of social justice through the welfare state and redistribution of wealth through social/economic engineering by government with a heavy dose of environmentalism.
Today's conservativism is also a pro-government form of thought but with different values of security and protection and the preservation of certain traditional values of family, church, life, and country.
Libertarian thought is not a pro-government form of thought. It is a form of limited government thought that values the freedom of individuals in all their diverse forms of constructive activity both social and economic.
So as to these definitions, clearly we have two major classes of political thought, that of the pro-government form that uses central and control by government to achieve valued ends, and that of the pro-freedom form that opposes central planning and control and favors free, non-harmful activity. The pro-government class itself has two subclasses, liberals and conservatives who both use government but for different valued goals. Of course we can define things however we choose as long as the definitions are useful and coherent but define we must since without stable, valid definitions no rational form of thought is possible, and that is what make discussion impossible.
So when we encounter a scholarly work addressing differences among the various forms of political thought, we would expect it to be based on clear, concise, and rational definitions but we can find all kinds of sloppy thinking without clear definitions that confuse the various forms of political thought. We find some who think that liberals should love the policies of President Bush since his administration spent lots of money. Or we find some who think libertarians should love President Bush's policies since under his administration we saw huge benefits given to big business that indicated an unfettered free market at work
To take one example, Thomas Frank in The Wrecking Crew, seems unable to base his analysis on any stable, clear definitions of libertarianism. He is an example of one who conflates libertarianism/free market policies with crony capitalism. He declares that "what makes a place a free-market paradise is not the absence of government; it is the capture of government by business interests." The lack of scholarship is a bit stunning since the free market idea of laissez faire clearly arose out of a critique of subsidies and government-imposed monopolies not by some obscure writer but by Adam Smith himself. He called these the "mean and malignant expedients of the mercantile system," and he clearly described the free-market principles as an alternative to "the capture of government by business interests."
So here in Thomas Frank is a scholar who states that "Governments are instituted among men in order to help one group in society exploit another," a statement indicating he clearly understands how some segments of society use the state to loot other segments but then he refuses to recognize that the opposite exists. The opposite of a powerful state in which the state is captured and used by either liberals or conservatives—or both together when they join forces to bail out business, give farm subsidies, etc.—is exactly what defines libertarianism, and in terms of definitions, it is the complementary class to the pro-government form of thinking.
Now even though on first glance the problem might seems to be a simple error  by Frank or an omission in his understanding of a proper definition of libertarianism and we often try to address it in that manner, there clearly is much more to it, something quite different at work. His notions of libertarianism are not simple errors that might easily be correctable since Frank actually seems intent in refusing to admit that the libertarian alternative is available and is fundamentally different from conservative thinking or the policies of the Bush administration. It is as if he wants to actively avoid seriously engaging libertarianism. There is something about his form of thought that appears to make him oppose libertarianism and see things the way he does.
We have then two problems. The first is simply the content of Frank's or anyone else's thought in which we expect normal sharing of information will correct errors and we will reach rational agreement.
The other is deeper and far more challenging. It concerns the ideological frameworks themselves, how they control thought, how they determine what is observed, how they operate such that they protect themselves and maintain their internal integrity. This problem concerns a different object of thought and analysis. This second problem is to understand how and why a form of thought arises that operates as an ideological framework that in spite of all the history and information available about libertarianism, it rejects or distorts facts and definitions in order to perpetuate itself. Now our topic is the various ideological frameworks.
For Frank's ideological framework how can we explain why it is that we repeatedly find this form of thought in which libertarian free markets are confused with big business and conservatives? Why does it repeatedly point to earmarks for business, outsourcing by government, regulations that protect big business from competition, and sometimes even corruption as defining properties of libertarianism and free markets? And what are the other ideological frameworks and how do they operate to maintain themselves?
At least some of the ideological frameworks include an emotional aspect such as is expressed in their polemical tone. This emotionalism in asserting the beliefs makes at least some of the ideological frameworks appear to be much closer to religious thought than to scientific inquire. Certainly we don't expect people to actually conduct scientific investigation into issues of political economy; we do, however, expect rational and objective discourse even when or perhaps even because someone is ignorant on an issue.
When discussions remain informative, objective, thoughtful, and pursue the formation of clarity in the definition of things under discussion, we can pursue the content of thought.  However, when a discussion degenerates into emotional assertions of belief, we might wonder if an ideological framework is at work. The challenge is to determine whether the discussion raises the first problem of simple content or whether it has moved to the second problem of an irrational ideological framework.

Wednesday, November 26, 2008

In Economic Policy, First Do No Harm


The response of today's politicians to the financial crisis is a kind
of activist government policy that depends on a spend-our-way-to-
prosperity approach crisis and appears consistent with Keynesian
economics. It is an approach that is supported by both the Democrats
and Republicans. President Bush has pushed for huge government
programs and spending of all kinds, and now in response to the
economic crisis the current spending by government will be the
largest in history. In spite of its staggering size, it has amazingly
widespread support.

The total spending the government has obligated is $7.8 trillion. So
far it has spent $1.4 trillion and has guaranteed about $8 trillion
in investments, loans, and deposits. To put this economic stimulus
program in perspective, it is easily larger than all the following
programs, that is, the combined total of all these
programs:

• Marshall Plan: Cost: $12.7 billion, Inflation Adjusted Cost: $115.3
billion

• Louisiana Purchase: Cost: $15 million, Inflation Adjusted Cost:
$217 billion

• Race to the Moon: Cost: $36.4 billion, Inflation Adjusted Cost:
$237 billion

• S&L Crisis: Cost: $153 billion, Inflation Adjusted Cost: $256 billion

• Korean War: Cost: $54 billion, Inflation Adjusted Cost: $454 billion

• The New Deal: Cost: $32 billion (Est), Inflation Adjusted Cost:
$500 billion (Est)

• Invasion of Iraq: Cost: $551b, Inflation Adjusted Cost: $597 billion

• Vietnam War: Cost: $111 billion, Inflation Adjusted Cost: $698 billion

• NASA: Cost: $416.7 billion, Inflation Adjusted Cost: $851.2 billion

This kind of thinking has parallels with the thinking of the 1930's
and 40's. What is interesting is that historically, the theoretic
basis for the general theory and policy of the 1930's and 40's was
discredited mostly by Milton Friedman but other free market
economists as well. They effectively destroyed the empirical and
theoretic basis of Keynesian economics, and supposedly put it to
rest. It was a consumer side type of economics that was hostile to
business, and many economists who have since analyzed FDR's big-
spending and regulating New Deal policies give evidence the New Deal
policies actually prevented economic recovery until after the war
when many of the policies were reversed.

On the other hand, Kennedy and Reagan used "supply side" economics
and applied across-the-board supply-side tax-rate reductions to get
America moving again. These pro business policies emphasized the role
of producers, not consumes, for increasing wealth production.
Increasing production and not increasing consumption produces
prosperity. Now it is hard to suggest that massive bailouts of
business reflects a hostile attitude toward business. However, it is
the activist role of government in managing the economy that the
current approach shares with Keynesian economics. But the basic
reality is that there is no clear evidence in history from any nation
that massive government spending or management helped an economy
recover or prosper. So why exactly does activist government and
Keynesian economic thinking keep arising?

The answer may lie in the more general and controlling framework of
people's ideas of how to explain and produce human progress; it may
be a kind of ideological framework or paradigm that lies beneath
their choice of position on many specific policy issues. It may be
that people don't begin with fact or theory by which to choose a
policy but they can only begin from within their existing framework
of how human society works. It may be this more or less subconsious
which guides their "choice" of facts and theories which they think
reflect the truth as they see it. So the two types of thinking, pro-
government or pro-freedom may represent a deeper framework of
thought, and quite clearly most of our political leadership believes
that solving problems lies in activist government, not the free
activity of citizens.

In formulating public policies, if one believes in government and
central planning the idea of raising taxes and using government to
create jobs, regulating wages and prices by unionization and forcing
producers into cartels, restricting free trade, creating government
regulatory and spending agencies and justifications using Keynesian
economic theory as happened in response to the Great Depression will
have great appeal.

On the other hand if one believes in free market economics in setting
public policies, then tax reductions, increasing rather than
contracting the money supply, deregulation of industries, lowering
trade barriers, promoting the expansion ofd business, and free market
economics will have great appeal.

It appears the pro-government framework may also account for support
of government entitlement programs such as universal health care,
Medicare, Medicaid, Prescription Drug program, Social Security,
welfare programs including education, subsidies such as Ethanol and
farm subsidies, and rent seeking regulations of all kinds that
promote one industry over others or regulations supporting one cause
over others. But it also accounts for foreign intervention, law and
order, military, and issues of morality such as drug enforcement and
pro-life policies. What seems apparent is that there is not one but
two pro-government sub positions. The liberal position seems to
emphasize government activism in matters of social justice whereas
conservative position seems to emphasize issues of government
protection. Each side at least somewhat supports free activity by
citizens in certain arenas but their respective arenas tend not to
overlap. Their fundamental differences seem to lie not in whether
they are pro-government control or pro-free activity of citizens but
in the differences in arenas to which they would apply pro-government
or pro-freedom policies. Thus both modern liberals and conservatives
tend to be pro-government in one form or another. But this
classification is amorphous and appears to change over time. The only
distinction that remains useful for a clear classification is that
between pro-government and pro-freedom—the pro-freedom position
marked by the consistent limitation of government and defense of free
activity in every arena.

As a result, the pro-freedom framework seems to account for choice
and deregulation in all kinds of arenas in order to "use" the free
market to award benefits for value produced and establish prices to
consumers for those valuable products. So this framework promotes
education vouchers, free trade of human organs, removal of trade
barriers and tariffs, protection of tort rights and contracts, and
where necessary entitling the needy directly with negative income
taxes, vouchers for needed services, food coupons, lifting licensing
restrictions for starting a business, disclosure in place of safety
and regulatory standards, all in place of creating government programs.

In discussing issues, these frameworks are seldom analyzed. Each
person mostly argues from within his own framework either to try to
show how things work or how they don't work both of which are
opposite to the views of someone in the other framework. But the
frameworks themselves are not discussed, and th reason may be that
most citizens are unaware of them, they are too abstract, they are
too deep, they take time to get into. Most discussions aren't
sustained inquiries into something. They are one-time discussions.

Yet beneath most policy debates are the fundamental differences
between the two frameworks and those differences are controlling. As
a result almost always debate among citizens or politicians is
limited to arguing within an underlying framework either as reflected
in those who argue for a government response to a problem or in those
who argue against government and for more freedom. One side says
government is the solution, the other says government is the problem;
one side says freedom is the solution and the other side (at least
often appears) to come close to saying free activity is the problem
(as in "unfettered" markets or allowing the rich to get richer and
the poor to get poorer). And both sides find it easy to denigrate the
other's position (as is displayed in the blogosphere). If the two
positions are controlled by an underlying framework, then at heart it
is not the issues or positions we should discuss. We should try to
get at the frameworks themselves, and that, by its complexity, time
required, and demands on the ability to conduct analytic thinking
eludes us.

So as to the current crisis and responses, my hypothesis is that
theory and fact clearly are not controlling or even relevant, the
ideological framework is. The politicians want to do something, think
they should do something, believe in something, that leads them to
act in disregard of how little they actually know of the science of
economics or the history of political economy. As a result, their
continued ignorant and thoughtless conduct means that no matter how
destructive it may be in the long run or how unfair it is, or how
much it costs to we citizens and particularly our children who will
have to pay the debt and live with the consequences they will impose
their "solutions" with utter disregard for the ethical principle,
"first, do no harm."

Sunday, November 23, 2008

The Swings of the Political Pendulum




The recent presidential election sets us on a still largely unknown direction by the nation’s new leadership. In politics and matters of political economy, prediction may look wise in the present but usually look foolish at a later time. Rather than predictions, we might consider some possibilities.

The Rejection of Excess, Not Conservative Principles


The pendulum has swung away from the Republican’s leadership but not necessarily away from principles of conservative governance. Polling shows these remain largely accepted among citizens.

What citizens do seem to have rejected are the unprincipled excesses and incompetence of the current administration, and the current administration’s unprincipled governance seems confirmed by its largely inarticulate and vague explanations and justifications as to exactly how their policies reflect anything of the founding principles that have made it possible for us to construct our advanced society.

If anything the Republicans’ politically pragmatic actions have rejected conservative policies and embraced the excesses of unconstitutional attempts to increase government power under cover of the need to deal with threats to our national well-being.

Superficial Politicians, Superficial Policies, their Goal of Power

When most of our political leaders aren’t rooted in society but are career game players in Washington their goals seem to center on finding a message that will be popular so that they can get elected and gain power. They want to be leaders who promise to take control, run the country, solve big problems. They do not aspire to leadership that subordinates its power to expanding people’s choices, respecting the diversity of citizens’ values, and protecting citizens’ constructive economic and social activities.

Their aspirations seem to focus on gaining more power, not principles of good government, and this focus on power often leads to excesses. Their credentials are political experience, not serious academic training or non-political leadership experience.

And they do not sound like ordinary people; they cannot use normal English to speak about principles to ordinary people. They instead use hackneyed phrases of political jargon, vague, overly general, without nitty gritty substantive meaning. They are not people we could imagine working in our community as an ordinary citizen. They are politicians who want more power so they can take over and run more aspects of our lives all justified by rhetoric of providing strong leadership to solve our problems.

It means the bigger pendulum of history may be driven by what citizens fear from unprincipled excesses in governance and power from either party. It is excesses in striving for power that has led to the wholesale rejection of the Republicans’ governance; the Republicans were not restrained by any deeper conservative principles that in the past appealed to citizens.

Reactionary Change In Leadership


As a result, we now have had an election signaling a rejection of Republican excesses. But the new leadership is still remarkably vague about whether it grasps guiding principles of a theory of governance or even what its policies will be. The new leadership may either contain the seeds of its own excesses if it remains unprincipled or it may develop an understanding of principles that produce a healthy, constructive society and that control the relationship between government and people.

Is this the new administration? If the citizens felt their fundamental problems with the Republicans were the excesses brought on by the Republicans “strong leadership” and that was unfettered by a principled understanding of the role of government, then the voters weren’t reacting to Republican or swinging to the Democrats; they were react to excess that was not born of principle. If the new administration cannot articulate and follow principles sensed to be proper by citizens, the new administration may produce a new set of unprincipled politicians who produce their own kind of excesses born of “strong leadership.”

The New Administration—More Superficial Power Grabbing or Principled Leadership?

So far we have largely had airy rhetoric given to broad, sweeping generalizations and vague promises drawing on the reactionary desire of people to fundamentally correct the current out of control and incompetent government. We need to see more of substance before predicting whether the new administration will eventually produce its own excesses and reaction from citizens.

The danger is that the new administration policies will continue to be composed of the vague goals of a hyper-articulate, hyper-charismatic man gifted in political speech. We do not have evidence yet that the new president actually has underlying principles and explanation of how our constitutional government is supposed to work and its proper relationship to people. He has offered amazing hopes and promises but without any clear analysis of the means to his ends. What tiny clues we have from his past service and voting give no evidence suggesting he understands basic principles of American governance.

Citizens aren’t concerned with principles and theories of governance and don’t take the time or effort to investigate and develop a theory of the relationship between government and society but they can sense excesses. They don't even seem to know what principles are. Even though they do not define the public policies they think proper, they can react to how policies play out. Citizens role is reactionary only and necessarily rather thoughtless regarding the underlying intellectual competence of a politician’s understanding of politician economy. Politicians’ can either help citizens understand the principled nature of their policies or if unprincipled and elected on superficial promises, to suffer rejection for their excesses.

More But Different Excesses or Principled Government?

While the new president may represent a major swing of pendulum, if the swing is not based on a fundamental theory and principled form of governance consonant with the constructive powers of American political economy, it may be only a reactionary alternative to the Republican’s recent excesses in governance and grabs for power. If so, the new administration may itself produce its own excesses. It remains to be seen but if the new leadership cannot articulate a substantive theory of governance, then we might predict another reactionary election. The time still remains ripe for change to be tied to principled governance by an articulate leader.

Saturday, November 15, 2008

The Challenge for Liberals—Defending the Use of Government Force & Its Corruption

The challenge for liberals (or anyone who believes in government as the means to social engineering) is to explain how changing private decisions into government decisions won't result in politics in which the politically powerful take over the decisions.

If one believes in good through government, then one might be able to point to some good things government seems to have done but to be consistent one also has to account for the bad even when the intentions seemed good. One then is in the awkward position of having to defend government actions such as the massive bail outs, tax breaks, and regulatory protections of big corporations and businesses since they too are always justified by good intentions.

The only possible method for justifying government action is to focus exclusively on the ends and ignore the means. The good intentions that justify government action only work as justification if the means of government force and its use by the politically powerful can remain unquestioned and perhaps even repressed.

As soon as government as the means to various ends is questioned as an immoral political method by which one group uses force to take away from another group, then the impossibility of government working as hoped for to produce the lofty goals that are intended collapses into hopes not attainable by government. The problems of the politics of the powerful will always haunt liberals. See this George Will column.

Belief in the Beneficence of Unlimited Government Just Cost Us Another 2 Trillion.

As the economic crisis continues, we're constantly hearing critics blaming America's alleged "laissez-faire economy" for somehow causing it. Tthe New York Times recently declared: "The United States has a culture that celebrates laissez-faire capitalism as the economic ideal."  It's hard to know precisely what such a statement might mean or why the assertion was made.

First, the assertion doesn't fit with the considerable government involvement, some of which reaches back to Hoover's time. There are 15 cabinet departments, nine of which control various aspects of the U.S. economy: the Departments of Transportation, Housing and Urban Development, Health and Human Services, Education, Energy, Labor, Agriculture, Commerce, and Interior. In addition there are many federal agencies controlling many more aspects of our economic lives: the IRS, the FRB and FDIC, the EPA, FDA, SEC, CFTC, NLRB, FTC, FCC, FERC, FEMA, FAA, CAA, INS, OHSA, CPSC, NHTSA, EEOC, BATF, DEA, NIH, and NASA.Second, as to the why, it may be that attempts to blame problems on free markets provides justification for more government involvement. 

Since obviously we are far from a lassize faire economy and with the trend almost constantly toward more government involvement, blaming free markets for economic conditions provides justification for more government involvement. By defining a condition as a problem needing immediate action leads to unlimited government. Here's the response of unlimited government (compiled by Reason magazine) to our current economic condition:

* $29 billion for Bear Stearns
* $143.8 billion for AIG (thus far, it keeps growing)
* $100 billion for Fannie Mae
* $100 billion for Freddie Mac
* $700 billion for Wall Street, including Bank of America (Merrill Lynch), Citigroup, JP Morgan (WaMu), Wells Fargo (Wachovia), Morgan Stanley, Goldman Sachs, and a lot more
* $25 billion for The Big Three in Detroit
* $8 billion for IndyMac
* $150 billion stimulus package (from January)
* $50 billion for money market funds
* $138 billion for Lehman Bros. (post bankruptcy) through JP Morgan
* $620 billion for general currency swaps from the Fed

So far as of November 7, the total is over $2 trillion dollars: $2,063,800,000,000 about $6,800 for every man, woman, and child or about $15,000 per taxpayer given to private firms. The belief in the unlimited wisdom and beneficence of government is responsible for such immoral actions, not the Libertarian ideology of free markets which takes a clear stand for protecting individuals from such hyperactive government action.

The Gates Foundation—Still Stuck Inside the Box


The thinking of the Gates Foundation, just as with so many foundations such as the Oregon Chalkboard Project, is still trapped inside the traditional box of the public school model. As a result of their inside-the-box thinking, their past efforts in tinkering with reducing school size did not amount to much. The Foundation of course wants to learn from the results and adjust its goals but its emphasis is still on improving the existing public schools.

Getting outside the box requires some big idea but for whatever reason, it is not yet ready to tackle the big ideas just yet. Instead it wants to continue its emphasis on successful high-school completion and college-readiness for disadvantaged young people; it wants to add a parallel thrust toward college completion and feature measurable targets for both. It also wants to get into developing national standards and tests to markedly strengthening education data. And of course it wants to enhance research into "what works," accelerate the development and use of education technology, and strengthen teachers across multiple fronts perhaps by performance-related pay and tenure systems.

Wednesday, November 05, 2008

To Discuss Issues of Political Economy

    As a preliminary to any coherent discussions of specific issues of political economy, it is necessary to be clear as to the basics of American political theory. We could begin by asking:

—First, do we accept our history as a given, that the U.S. is rather unique in establishing the first limited government and lasting republican form of democracy, that the most basic expression we have is in our founding documents, the Constitution, the Declaration of Independence, and the writings of the Framers? If we differ in our understanding of American democracy, we do not have a common framework for conducting further discussions. Our form of American democracy is a political means that makes possible  personal economic and social freedom. It was established as a the first form of governance in which we as free people consented to be governed and carefully restricted government powers. We aren't a government that consents to or or determines people's freedom.

—Second, do we accept the principle that the source of the construction of a society, the common good, comes not from government action but from citizens' activities? To do more than to protect citizens' rights to conduct activity freely as in the first principle means that government is acting in the manner in which some citizens use power to forcibly impede, direct, demand, regulate, or redistribute at least some citizens' products or activities. Any use of force, whether by a group using government power or by any other group or individual who lack omniscience, remains an act of ignorance and moral repugnance.

—Third, do we accept the principle that benevolence is a voluntary activity of helping others in need?  Government cannot and is not a source of benevolence.; it cannot solve some citizens' problems except by forcibly taking away from other citizens, an action which enhances some citizens at the expense of others. To forcibly diminish some citizens' to the benefit of others is unjust. Government and government processes whether democratic or not use forcible redistribution and cannot be benevolent.

If we lack agreement on starting principles, we are organizing our thoughts in two different frameworks. The purpose of our exchanges must shift to an investigation into the differences of our two systems of thought as to how they differ as to the constructive powers of human activity.

Human activity, as for all living, is constructive by its own self-regulative powers. Life is form creative, and those external forces that impede activity impede its constructive powers. When governments or powerful people actively attempt to impede free activity, they necessarily impede the development of life. When a group of people by their use government attempts to go beyond the first principle of only using government to protect citizens' freedom, that group of people necessarily is reducing the equality of justice and the constructive power of some citizens' activities in order to give to others. Government is not moral except as it protects someone from forcible harm; life in its constructive powers is moral except as it uses force for private gain. Living activity tends toward cooperation, benevolence, love, creativity and away from arbitrary action imposed on others. People can form governments to protect these constructive powers of living activity but only if they limit the power given to government so that it carries out its activities in an equally just manner for all.

But there are other views of human activity that do not see it as form creative and without inherent self-regulative powers. An investigation those other methods of understanding of how social order is constructed will reveal how these understandings develop and their derivative views on specific political issues. Without agreement as to how things that are of social and economic value are created and constructed, how the common good arises, we can have no basis except a quasi-religious belief in government good and speculative public policies based only on hope. We have constructed a society; we continue to construct a society; and we should first be sure we cause no harm before we forcibly interfere with that constructive process.