Right Reason

Some Thoughts About Casuistry and Healthcare Policy

 

One of the fundamental problems with talk about healthcare in politics today is casuistic: Commentators start with the hard cases and try to craft policy based on hard cases that pull at the heartstrings, rather than straightening out the easy cases of daily life first. Americans should be more concerned, say, with the fact that the word 'insurance' has lost its economic meaning in healthcare, that laws require, for instance, women to still have expensive prescriptions to purchase birth-control pills, and that a command-and-control regulatory structure stymies entrepreneurial experiments in healthcare, both in medicine and in its organization, than in Jimmy Kimmel's son.

 

The former three are problems that millions of Americas deal with in their daily lives and are the "easy cases" having to do with an efficient allocation of resources and technologies that make the most out of the scarce wealth people have. The latter case is the hard case about what happens when an individual's wealth is overwhelmed by catastrophe. However, when we start off with the hard case of when a person's wealth isn't enough, we immediately assume away matters of trade-offs and efficiency that should inform any market and therefore make ourselves entirely unequipped to grab reality with both hands.

 

How we approach policy is going to be determined by the questions we ask and the tools we use to answer them. Concerns for beneficence must follow after concerns for justice, lest we get our principles into a muddle. If we cannot count on our principles, then we are entirely lost here. The fact is is that our emotions are simply not adapted to solving the problems of achieving an efficient allocation of resources and technologies in a complex society. Instead, of first tackling issues of life and death, American healthcare policy needs to first address issues of daily convenience, lest we get policy that, despite working for no one, still achieved the goal of receiving moral approbation when it was passed.

The Eternal Political Question

Parag Khanna has a new book coming out: Technocracy in America: Rise of the Info-State. I have not read the book yet. I am looking forwards to doing so in the upcoming months. However, I liked his previous book, Connectography, quite a bit actually. One of my principal complaints about Connectography was that the ideas in the book could have been communicated in a much shorter amount of words. Alas, such is life, most books should be articles and most articles tweets.

Mr. Khanna is a thinker who deals in big ideas. Those big ideas must be confronted because our opinions about many smaller matters will depend on how we react to those big ideas. The themes of Connectography brought out the significance of different types of unseen geography to the prosperity of the international division of labor and how it’s those de-facto connections, rather than the de-jure ones we are more familiar with, will determine the fate of our species for generations to come. I await to see what themes he offers in his new book.

However, there is a sneak-peak. With the new release, Mr. Khanna has quite the interesting interview with The Washington Post, in which he discusses many of the significant themes of Technocracy in America.

One of the themes that concerns me is the fact that Mr. Khanna seems to believe that there are clear and defined rules by which we should evaluate the success of policies when he discusses technocracy. He defines ‘a technocrat’ as being: “a meritocratic, utilitarian civil service personnel.”

The definition rings too praising for me. Mr. Khanna is already stacking the deck in technocracy’s favor based on merely how he defines the word ‘technocrat’. It doesn’t seem that there is much space in that definition for a technocrat to err and, in his hubris, to become a man of the system. There also doesn’t seem to be much space in that definition for technocrats to be illegitimate. What is one then to make of Mario Monti, who was Prime Minister of Italy from 2011-13. He ruled in an explicitly technocratic fashion, yet did not rise to his office by any meritocratic process, but was instead invited to form a government by Italy’s president.

Later in the interview, Mr. Khanna doubles-down on his definition of a technocrat as a road forwards:

This new technocracy has to be meritocratic, and it has to be utilitarian. Maybe there’s no more important word that needs to be reintroduced into the American political conversation than utilitarianism. It’s a quantitative measure of how fair and decent leaders are.

From my own reading, it seems Mr. Khanna seems to be arguing that we can simply collect the facts, put them into a utilitarian algorithm and be able to calculate how well technocrats are performing.

Alas, I don’t think that is possible. One of the problems afflicting democracy in America today is that there is no such agreement about such an algorithm. All facts exist in a shared perspective of the world. Without that shared perspective, those hard facts themselves dissolve into much softer theory-laden discussions. Hence an honest attempt to imitate successful methods in the hard sciences merely glosses over the more philosophical and humane nature of the problems at hand. Even generations after they die, historians shall debate over “how fair and decent” our leaders have been.

Mr. Khanna’s proposal would have its best chance of working in a nation in which people have basic agreement about the perspective politics should face. I am dubious that Americans live in such a nation today.

 

However, Mr. Khanna clearly has in mind something more of a constitutional moment than a piecemeal reform when elucidating his ideas. One constitutional reform that he certainly has in mind is the idea that the government should matter less and that technocrats should, by and large, go unnoticed, apart of the national furniture, so to speak:

I’m a technocrat in my heart of hearts. I’m much more interested in institutions and policies than in specific people. I just don’t care who is president. I really don’t. I just want to see a better structure. There’s this line we use in other fields: Bad process, bad outcome. When you have a bad process, surprise, surprise, you get a bad outcome. So I want to see a better process, as I have in all these other countries.

I do agree with the overall sentiment that Mr. Khanna expresses here. To quote John Adams, the object of constitutional design should be a government of laws, not of men. However, it is difficult to imagine personalities not mattering during a constitutional moment. America, for instance, was quite fortunate to have the statesmen it had during its own Revolution. For example, the United States could have evolved to be a vastly different nation if George Washington decided that he wanted to be king.

 

One enthusiasm that I share with Mr. Khanna is a fascination with Singapore and the belief that Singapore has mutated quite the efficient government. The creation of more Singapores would be a great victory for the prosperity of the human species.

Allowing people to create and to immigrate to cities that experiment with different legal régimes might be a means of lifting millions out of poverty and of discovering the best means of generating prosperity in foreign lands. Achieving prosperity is not a problem of getting to Denmark, as if the laws of political development are clearly defined.

Instead, achieving prosperity is a matter of discovering a means of becoming the best India, China, Kenya, or Indonesia. It is more a process of experimental evolution and less a process of rule-following ontogeny. More city-states would allow for more laboratories for technocrats to experiment with different ideas for how to achieve prosperity. Unlike centralized nation-states, dispersed city-states provide humanity with optionality; we can select the best and have people imitate and immigrate to them.

However, it is important to remember that Singapore is an accident of history. It is former British colony that retained Common Law post-independence that has retained its independence from surrounding nation. Hong Kong is another example of such a city-state. Moreover, both aren’t just accidents of history, they’re relics of a colonial past. The only reason that they exist is because a foreign people were able to claim both islands for themselves and impose their own law on those lands. I don’t think there is a similar path for city-state creation in the world we live in today and such thoughts can bring us frighteningly close to an imperialistic mindset.

The technocratic institutions that Mr. Khanna lauds all need to be created. Unfortunately, in their creation, it quite matters who the architect is and here is one of the central ironies of the belief that the state needs to matter less: For the state to matter less, it needs to make itself matter less—and it needs to be strong enough to make itself matter less. 

The problem is, as it has been for millennia: Quis custodiet ipsos custodes?

 

The Difference Context Makes

In philosophy, I’ve always thought that those who abstract the value of human life across different contexts are very much not to be trusted. Ethics and politics are necessarily strategic. When we abstract from context, we lose the details that should inform our conduct.

The excellent Bill Vallicella argues such a point in his rebuttal, “Why some think that terrorism is no big deal,” to Bryan Caplan and Nathan Smith’s views that people fret too much about terrorism because so many more people die other preventable events, they pick the example of automobile accidents. While I certainly think that the statement that people fret too much about terrorism should go without saying. However, I do not believe that their argument is all that convincing and agree with Mr. Vallicella when he writes:

But this sort of reasoning involves vicious abstraction. It is highly unreasonable to consider merely the numbers on both sides while abstracting from the motives of the terrorists and the societal impact of terrorism. With very few exceptions, drivers do not intend to kill anyone, and when their actions bring about deaths, those deaths involve only themselves and a few others.
Suppose a drunk driver unintentionally causes the death of himself and a family of five. Total deaths = 6. Other people will be affected, of course, but not many. (The wife and children of the drunk driver will now have less income to get by on, etc.) The effects are confined to a small circle of acquaintances and the effects are not additive in the way that the effects of terror events are additive.
One cannot reasonably abstract from the political agenda of terrorists and the effects even a few terrorist events have on an entire society. Ask yourself: has your life changed at all since 9/11? It most certainly has if you travel by air whether domestically or internationally. And even if you don't. Terrorists don't have to kill large numbers to attain their political goal and wreak large-scale disruption. The Tsarnaev attack on the Boston Marathon shut down the city for a few days. Same with Paris, San Bernardino, Madrid, London, etc. That had all sorts of repercussions economic and psychological.

Deaths due to terrorism have wider effects than deaths due to automobile accidents. Mr. Caplan gets that point right in a follow-up to Mr. Vallicella’s remarks, writing:
"This boils down to complaining about the reaction to terrorism. But that's ultimately my and Nathan's point: Popular cures for terrorism are far worse than the disease."

He is right, but then he fails to recognize what, I believe is Mr. Vallicella’s point: That the deaths due to terrorism will have a qualitatively different effect as deaths due to tragedies people consider mundane. As much as intellectuals, such as Mr. Caplan, may be right in arguing that popular cures for terrorism are worse than the disease, his saying that won’t have much impact on whether those cures are implemented. I don’t think that the voting public will ever think after a terrorist attack: “Well, these things are bound to happen and we are safely within the acceptable level of deaths.” They should, and they may come to such an opinion when time passes and cooler heads prevail.

Nevertheless, in thinking about policy, the public response to terrorism must always be factored in when thinking about terrorism strategically. Policy-makers should adjust their actions based on how they believe voters and commentators alike will respond to terrorist attacks because those responses will have definite effects, just like the terrorist attack.

We shouldn’t be romantic about how people will respond to terrorism. If we take reactions to terrorism attacks, such as those that happened in Istanbul last week or Paris a couple of months ago, as given, terrorism will generally have the cost of creating public uproar to stop terrorism. As much as that public uproar may be unproductive, it shall still be there, and a wise statesman should take that into account. Not stopping a terrorist attack therefore might have a second-order effect in causing anti-terrorism panic.

Ultimately, Mr. Vallicella is right. If we care about civil liberty, we do need to take seriously the fact that terrorist attacks have adverse consequences for those freedoms. Going on to pretend that a serious terrorist attack won’t empower those who desire to mitigate our civil liberties in favor of harsher anti-terrorism measures is nothing less than a romantic view of politics.

A Grain of Truth Amidst the Circus

Another year, another state-of-the-union address. Except this year, it's President Obama's last. For one party in Congress, the spectacle is a much-need exercise in calisthenics; for the other, an exercise in biting one's tongue and remaining silent for an hour or so. I pity anybody who actually watched the thing, reading the transcript is more than enough pageantry for me. Imagining having to sit through all of the obligatory standing ovations and all of the That said, people do love a circus, especially political junkies. As Hunter S. Thompson once wrote, politics is a guilty addiction.  

In her rebuttal of Mr. Obama's speech, Governor Nikki Haley said that "tonight President Obama spoke about grand things. He is best when he does that." Alas, such grand things are meaning for people without any meaning, friendship for those without friendship, religion for those without religion. The grand vision promises that we might matter if our nation is great and, more importantly, if our particular faction is in ascendance. All too many political junkies care more for electing their grand priest to lead the ceremonies than the costs and benefits of their political program. It is they who think that the greatness of the nation can be expressed in whether we—there is always some 'we'—have put a new piece of metal out in space. Yes, because having a man walk on the moon has really made people's lives better. Alas, the delusion that we are somehow better people for being citizens of a great nation will save us neither from death nor our own misery. At least actual junkies tend to only hurt themselves.

Still, there is much to learn from an event planned two-fold as a exhibition of Washington's ruling court and as a much needed hit for those hopelessly addicted. One does have to admire rhetorical flourishes such as: " Food Stamp recipients didn’t cause the financial crisis; recklessness on Wall Street did." That sentence alone is a good reason to learn the tools of rhetoric, lest one be persuaded by such nonsense. Food stamps and the financial crisis have nothing to do with each other, still the pairing of the ideas can keep one's head nodding until its sheer ridiculousness becomes manifest. I dare anybody to find a similarly catchy retort. Unfortunately, pointing out that the two ideas are entirely disjoint will not do. Much like those under the influence of some substance, sometimes it's best to just wait before discussing ideas with those under the influence of rhetoric.

 

Among the many insidious effects that a state of the union has on its listeners is the tribalistic reflex to defend one's own side. To either immediately point out how this address is the culmination of one of the worst presidencies known to man or to argue how it is the ultimate politic mic-drop. Let me do neither and point out something that I actually liked, despite not being of the president's political tribe, and that is his declaration he will close Guantanamo Bay. In the speech, Mr. Obama reemphasized his determination to close that monument to the excesses of American foreign policy in a post-9/11 world, something he had promised to do in his first year eight year ago, saying: "leadership depends on the power of our example. That is why I will keep working to shut down the prison at Guantanamo: it’s expensive, it’s unnecessary, and it only serves as a recruitment brochure for our enemies." That action is long overdue.

On the topic of Gitmo, I am reminded of a quote by William Ewart Gladstone, who wrote in 1845 of the British treatment of Ireland in a letter to his wife: "Ireland, Ireland! that cloud in the west, that coming storm, the minister of God's retribution from cruel and inveterate and but half-atoned justice! Ireland forces upon us these great social and religious questions. God grant that we may have courage to look them in the face and to work through them." In a misguided War on Terror, the United States has been the agent of great evil in the world. American policy has run the gamut of horror: From apathetically snuffing out individual lives from 50,000 feet without noticing to toppling a nation without much thought for the future.

Life is enough of a Greek tragedy for us to expect that even a well-intentioned delay from transferring the last prisoner from that shadowy fortress will result in some retribution. 

Let Greece Go!

 

 

Greece owes  €317 billion, about 175 percent of its GDP. Those numbers are meaningless by themselves. For a vibrant economy, such as that of Germany or the United Kingdom, a similar debt wouldn’t be such a problem. But it’s neither Germany nor the United Kingdom that we’re all thinking about now. Instead, it’s Greece, a dysfunctional nation whose economy has been in recession since 2008. 

It’s looking increasingly likely that Greece will default on that debt this summer. Let’s not kid ourselves, whether Greece would default on its debt has been clear since the Euro Crisis began in late 2009. Since then, Greece has teetered on the brink of default with increasing amounts of cash being given to the Greek government to keep it going—and compliant. The question has been when not if. That time seems to be upon us. Despite technocrats’ efforts to steer Greece to calmer waters, with capital controls on Greek banks being the most recent attempt, Greece is far from them. Rather, the inescapable currents of change, hiding right beneath the surface, continues to drag the Greek ship of state further from coast.

 

Really, the trend of Greek politics over the past half decade or so has been the story of captain after captain fighting against those currents. Greek’s economic and political nature cannot be recast from Brussels or even Athens. Recent concern about Greece failing as a state if it were to default misconstrues the predicament the nation finds itself in. Greece won’t suddenly fail as a state as a result of defaulting on its debts. Rather, Greece has been a failed state all along. Greece has had a long history of political corruption, economic inefficiency, and the systemic failure of its institutions. It was only able to gain admittance to the Euro Zone by cooking its books. Wall-street designed financial instruments could only cover up the mess that was Greece’s fiscal situation for so long. 

The nation has to reform, that much is true. Economic liberalization, and yes austerity, need to occur if Greece is going to prosper. Greece is stuck in an equilibrium of leisurely inefficiency that the Greek people are deluded to think can continue. It cannot, but the teethed reform that can actually change Greece structurally is a point that cannot be pursued as long as Greece holds onto its current debt. Paying back that debt is currently such a drain on the Greek economy that reform simply isn’t politically feasible. Moreover, the point of the troika’s bail-outs have never been to liberalize Greece, but to preserve Greece as a member of the European Union. 

 

Throughout the Euro Crisis, the important decision makers within the European Union have been interested in their own political projects. As self-interested politicians, their interest in Greece has largely been restricted to how Greece fits into a scheme of European unity and they have been more than willing to sacrifice Greece on the cross of European ambition. 

Last May, when giving a speech during the award of the Charlemagne prize for furthering European unity, Chancellor Angela Merkel warned that if the Euro fails, then “then Europe and the idea of European union would die.” Yet, Chancellor Merkel knows to let no crisis go wasted: "We have a common currency, but no common political and economic union. And this is exactly what we must change. To achieve this—therein lies the opportunity of the crisis."  Jean-Claude Juncker has yet to show a whiff of sympathy for Greece and has instead gone out of the way to state that he felt betrayed by Greece in the latest negotiations over Greece’s debt. To European leaders and Eurocrats alike, Greece is just a means towards their end of a centralized Europe, not an end in and of itself.

 

The crisis calls for an empathetic point of view that genuinely wants what is best at Greece. Policy makers should want to best for everybody involved in any political question. Looking at the crisis merely as a moment in the history of the European Unions inextricable march towards unity or as a threat to the world’s financial stability ignores many of the political dimensions that define the crisis.

For instance, merely looking at the financial consequences of Grexit overlooks how the strain of Greek debt has prevented any political progress in Greece. Syriza rose to power by speaking out against the demands put on Greece by the European Union and the troika. The party’s policies may be the last thing that Greece needs, but these are the policies that Greece will inevitably get as long as the troika meddles in their politics. The Greeks understand that the European Union care little for their plight. According to them, Greece needs to stay in the European Union, no matter the Greek costs. 

Greece has borrowed beyond its means, yes, but the banks have been there as enablers. They should have lent money with their eyes wide open. The banks that have lent to Greece made bets that haven’t paid off. The losses of those who haven’t already been bailed out will be certainly extreme, but so have the loses of the Greek people. The interests of the financial sector shouldn’t be made sacrosanct as the expense of the Greek people. Obsessed with the standard of economic efficiency, policy makers have been blind to the concerns of justice and equity involved when the banks get themselves into trouble. Nevertheless, policy choices today can put the developed world back on the right political track. In a world where finance has increasingly made the world fragile, a Greek default could help signal to the world that policy won’t play favorites for the financial sector, as it has done in crises past. 

If Greece is guilty of an irresponsible fiscal policy, the nation’s culpability must be balanced by the irresponsibility of those who lent money at close to near-German rates to a very non-German nation. Creditors and debtors alike are at fault. Greece alone cannot be isolated as the only guilty party who deserves to suffer the costs of the fact that they cannot pay back their loans. Just like almost all the other rich nations, those of Europe need to demonstrate to the financial sector that their interests are no more special than those of ordinary people’s. Letting Greece default on its debt without back-room negotiations to ensure that the banks get paid on their imprudent loans would be a small improvement on that margin.

 

The creation of a euro was an ill-conceived policy, informed more by the fantasies of politicians and eurocrats alike than the fundamentals of their societies. Reality needs to reassert itself. European leaders need to admit that Greece cannot prosper as part of the Euro Zone. The slogan of the hour needs to be: Let Greece go! 

Greece will still be in an unenviable predicament, but it will be in a position to decide on their own policies. If political reform fails, the Greeks would deserve to suffer a catastrophe of their own making. Today, they deserve relief and an opportunity to pursue reform on their own initiative. 

Nirvana Libertarianism

All too many libertarians aren't actually interested in libertarian policy. That's fine insofar as they don't hurt libertarian policy, but there exist in the world a brand of not-so-serious libertarians that can't accept anything but perfect policy on issues such as the Trans-Pacific Partnership. In doing so, they hold back any hope of the evolution of libertarian policies.

Matters of policy are always going to be about the adjacent possible. They’re going to be about making marginal changes that accumulate over time. In this sense, states do evolve. They do accumulate tiny variations, whether useful or not, and their forms are changed across the generations as a result of that accumulation of variation. The point of good public policy, or statesmanship if you will, is ensuring that the best marginal changes happen.  

For libertarians, policy should largely about choosing the policy that ranks higher in liberty. As a political program, libertarianism can largely be collapsed into a single principle: The liberty principle, exhorting people to support the policy that ranks higher in liberty. Yet for many libertarians, that isn’t enough. Instead, they only option that can be considered is an option that ranks 100% in liberty. For them, politics is about utopia or nothing. 

 

N. Stephen Kinsella is one such libertarian. In “Trans Pacific Partnership is about Control, Not Free Trade,” Mr. Kinsella argues that the “TPP is just the latest instance of the US federal government employing its post-WWII dominance to advance the interests of the music, movie, and pharmaceutical industries in the US, at the expense of US consumers and foreigners.” He argues that the only acceptable libertarian position would be unilateral trade:

A real free trade policy would amount to a couple of sentences, not thousands of pages: one nation announcing that all imports and exports to and from that nation are to be exempt from duties, controls, quotas, tariffs. That is free trade. Instead, we have the managed trade of the last 60-70 years.

However, Mr. Kinsella seems to be utterly blind about the state of free trade as an issue in America. A large chunk of the population don’t even like slightly open trade. Unilateral free trade is simply not attainable in the nation Mr. Kinsella and I live in. Curse out the people for that, try to educate them and do whatever else one may desire to do, unilateral free trade is suddenly not going to become a policy any politician can successfully commit himself to. Barack Obama, normally an enemy of libertarian reform, has had to work quite hard and defy his own party to get the reform that’s on the table right now. Yet, because it doesn’t correspond with Mr. Kinsella’s ideal, he rejects it. 

 

Normally, libertarians are very good at calling out when other people use the nirvana fallacy in support of government encroachment, but they tend to be as utopian as anyone else when talking about what they like. Harold Demsetz coined the term ’Nirvana fallacy’ in his paper, “Information and Efficiency: Another Viewpoint,” writing: “The view that now pervades much public policy economics implicitly presents the relevant choice as between an ideal norm and an existing "imperfect" institutional arrangement. This nirvana approach differs considerably from a comparative institution approach in which the relevant choice is between alternative real institutional arrangements.” 

The libertarianism of Mr. Kinsella falls victim to such a view. Rather than thinking about how policies affect liberty on the margins, he merely considers 100% cases. His libertarianism is a Nirvana libertarianism and it actively hurts any chance of libertarian reform in the world people live in by preventing marginal reforms for liberty. 

 

Overall, as attested to by “Trans Pacific Partnership is about Control, Not Free Trade,” Mr. Kinsella isn’t a very serious libertarian. He may write on libertarian policy, but he fails to grasp the basic fact that all matters of policy are about marginal changes. It’s about evolution and the accumulation of slight variations that drive any evolutionary process. It’s a shame that such not-so-serious people tend to dominate the discussion about liberty. 

When Removing Government Requires Government

 

Whatever you think of them, reform happens at the margins of politics.

 

Free trade has always been a tenet of libertarianism. After all, the unimpeded movement of goods across borders may be a paradigmatic example of the libertarian maxim of ‘Anything peaceful.’ It is then with trepidation that many libertarians have looked on at the debate surrounding free trade today. For them, the Trans-Pacific Partnership doesn’t look anything like free trade. Instead, it looks like just another arrangement between governments bestowing benefits upon their favored cronies at the expense of the rest of society. Yet, for whatever its controversy, if it is passed, the Trans-Pacific Partnership would be America’s largest trade agreement in effect and would thereby represent a marginal liberalization of trade across the region.

 

The Trans-Pacific Partnership, then, is an example for a central irony to libertarianism: Although libertarianism advocates anything peaceful, it is often in need for politicians to advance its agenda. Very frequently the very act of de-governmentalization itself requires government. What a government erects can very often only be demolished by a government. Although, many new technologies have and will emerge that can disrupt regulations and thereby increase the overall liberty of society by creating a space that has yet to be interpreted with, such disruption isn’t always possible. In the case of trade, new technologies may make certain tariffs and quotas irrelevant to the lives of consumers, many more will remain and, in some way, harm consumers.

 

No Uber-like company will emerge that can allow American consumers to find a way around the United States’ protection of domestic sugar producers. Doing that would require government. However iron-clad the arguments for free trade may be, to actually get free trade requires a government eliminating its own obstructions, just as the peaceful enjoyment of alcohol required it to repeal the Eighteenth Amendment. Bargaining, interviews, negotiations and speeches are all necessary parts of the process. Without political acumen, trade reform would go nowhere. Free trade needs crafty politicians who are aware of when the political stars align and who can seize the initiative to advance liberty-enhancing reforms at the margins.

 

Libertarians worry about whether the Trans-Pacific Partnership would advance crony capitalism, not free markets. Cronies have certainly taken an interest in the treaty. That much is indisputable. As The Guardian reports, for ever ‘yea’ vote tallied in the Senate to give the White House fast-track authority, the US Business Coalition for TPP gave an average of $17,676.48 to it. That negotiations of the Trans-Pacific Partnership is being kept secret, contrary to standard operating protocol, only compounds those suspicions.

 

Although President Obama has said that there is nothing to worry about with the secret negotiations, certainly the president is not unaware of how ironic it is for him to assert that while still keeping the supposedly innocuous records out of the public eye. The old quip, quis custodiet ipsos custodes, looms large. Combined with the amount of money that businesses have spent, the secrecy surrounding the Trans-Pacific Partnership is bound to pique the suspicion of many libertarians. Those opponents of the Trans-Pacific Partnership are, then, right enough since there certainly is plenty of crony capitalism in the Trans-Pacific Partnership.

 

Nevertheless, a sober assessment of the treaty and particularly its impact at the political margins of liberty should inform us that these are acceptable costs to a policy that will lead to an improvement of the overall liberty of all involved. It’s true that the Trans-Pacific Partnership wouldn’t lead to a system of perfectly free trade and, in doing so, would plenty of room for each nation’s particular cronies to prosper. But we don’t live in a world where such a system of perfectly free trade is attainable. We live in a world where the treaty is on;y an improvement at the margins and where those improvements are going to have to be made in a way that placates each nation’s many cronies. The Trans-Pacific Partnership promises just that: marginally freer trade, with all the benefits that marginally freer trade would have. The Brookings Institute estimates that the global gains that marginally freer trade would be in the vicinity of at around $295 billion each year.

 

By being self-aware that any liberalization of trade would require government action, libertarians can be very open about the costs of the treaty while at the same time confident that it will have a beneficial overall effect. To remove the barriers to trade that exist across the Pacific requires an act of government. That alone would introduce some cronyism to the reform. Worse, it requires an act of many governments, all with their own particular faults. Nevertheless, that any progress towards liberalization in trade is possible is itself a miracle. A miracle that is only possible because of crafty politicians in government today. It’s not everyday that their actions would have a liberty-enhancing outcome and so the opportunity shouldn’t be squandered by comparing our imperfect world to a libertarian utopia.

 

Overall, the Trans-Pacific Partnership reveals an irony in any hope of libertarian reform today: However much libertarians may properly distrust politicians, free-trade reform will only happen if the politicians in power are able to negotiate the restraints away. On this issue, the cause of liberty, therefore, is in the precarious and inextricable position of relying on government to remove government. Maybe they shouldn’t stop worrying, but libertarians should start to give the Trans-Pacific Partnership the modest love it deserves.

RIP Boris Nemtsov

 

Laws, like houses, lean on one another.

-Edmund Burke, Vindication of a Natural Society

 

Is there any good news coming from Russia these days? Whether it’s Russia’s involvement, to say the least, in Ukraine or the social slip towards ever greater kleptocracy, every word of news seems to be tinged by suffering as Russia becomes ever more totalitarian. In an interview with Anthony Bourdain, Boris Nemtsov quipped that “Unfortunately, existing power represents Russia of 19^th century, not 21^st  century.”  Last Friday, February 27^th, Mr. Nemtsov became a victim himself of that existing power when he was gunned down in Moscow, within sight of the Kremlin. In its coverage of Mr. Nemtsov’s death, The Economist  christens the man a liberal martyr. 

Like all good liberals should be, Mr. Nemtsov was a outspoken critic of corruption and cronyism in his home country. He was Vladimir Putin's gadfly. From his criticism of the Sochi Olympics to his work for fair elections, Mr. Nemtsov had always been one could look to in Russian politics to have some hope for a free Russia. His assassination on Friday is a blow to that hope. Even worse, in a world that sees Russia increasingly taking a belligerent stance towards the outside world, it’s supposed to be.

 

Those who assassinated Mr. Nemtsov were no amateurs. If they were, they couldn’t be to get away with the deed in sight of the Kremlin. The assassins know that we all know the conclusions that will be extrapolated from the event. To speak of Mr. Nemtsov’s death as a murder would, therefore, be a shameful unwillingness to address the political dimensions that the assassins knew Russians and, perhaps especially the outside world, would take from the event. As Mr. Nemtsov himself remarked in his interview with Anthony Bourdain: “Everybody understands everything in this country.” 

Just as Vladimir Putin, and even Boris Yeltsin, inherited the organs of their government from the Soviets, so too did the Soviets from the Tsars. Plus ça change, plus c'est la même chose. However small the machine of terror surrounding Vladimir Putin today may be when compared to either the KGB or Okrana, it’s still there. Assassinated journalists are an all too common event in Russia today. The assassination of Mr. Nemtsov is not much different from the use of terror in Tsarist Russia and the Soviet Union. Contrary to what Mr. Nemtsov suggested, the Russia of the 21^st century is still frighteningly like the Russia of the 19^th  century.

 

The Russian people, just like any other nation, cannot escape their history. As much as Boris Nemtsov is, indeed, a martyr for liberalism, he is on the wrong side of history. Mr. Nemtsov’s liberal optimism that the Russia of the 21^st century can be more like the United States of the 21^st  century than the Russia of the 19^th century ignores the importance of the evolution of social order in cultivating, and constraining the cultivation of good policies.

In Federalist No. 1, Alexander Hamilton offers the question of “whether societies of men are really capable or not, of establishing good government from reflection and choice, or whether they are forced destined to depend, for their political constitutions, on accident and force.” Hamilton has the ratification of the American Constitution in mind as deciding that question. 

Hamilton thought that the establishment of a new United States, one and federal, could prove that human beings weren’t tied to the governments they lived in, that they could come together for a better, brighter alternative. The words are full of the Enlightenment optimism about democracy that, should’ve at least, died a bloody death by Robespierre’s guillotine.The American Revolution itself wasn’t progressive, nor was it even a revolution proper; rather, it was a conservative war of independence. 

 

Russia is another illustration of why Hamilton’s words misrepresent how to get good government. Whatever hope and promise there may have been in the new Russian Federation of liberal reform, by now, are snuffed out. The exact causes of much too complex to explore in a short book, let alone here. Nevertheless, the conclusion that good government can be established “from reflection and choice” has been dashed. Intentions, themselves, aren’t enough. Nor is technical knowledge. To find success, all reforms have to work through history, that is through the complex process of all of human society coevolving with itself across time. Russia shows just how hard it is to establish a liberal society when all one has to go back on is a very, very illiberal history. I cannot escape the conclusion, then, that Mr. Nemtsov's campaign for a liberal Russia is, at the end of the day, tilting at windmills. Russians liberals can respond that they need to be apart of the change if it is to ever occur, but I then wonder where the realistic avenues for liberal change are. 

The nations in the former Soviet Union in Eastern Europe often do have a real choice: Look westward of eastward. The mutually exclusive visions for society ultimately represented by Washington DC and Moscow are very real. The Cold War happened for a reason, so did former Soviet Republics asking to join NATO ever since the scarlet banner was brought down from the Kremlin. 

Mr. Nemtsov’s death demonstrates that even amidst the institutions of tyranny, people’s desire for liberty still burns ardent. Alas, it also demonstrates that an ardent love of liberty isn’t enough to create liberal governments. Institutions aren’t create by people all pulling at once and choosing at a single moment to create them; rather, institutions grow across history. In formulating reforms, policy-makers have to keep that history in mind. All too often that history excludes the possibility of the desired reforms. 

 

As for Mr. Nemtsov being a liberal martyr. At least in my eyes, the struggle for liberalism in Russia, however Quixotic I may take it to be, seems to be much purer than the struggles for liberalism elsewhere. The reason for that is that Russian liberals actually face Søren Kierkegaard wrote that the truest Christians are those who had to suffer for their beliefs. Without that element of suffering, a Christian, Kierkegaard argued, couldn’t claim to be a true Christian. There is wisdom in that notion. It’s impossible to give a belief lip-service when one might become a target for it. Only those who have had to suffer a worldly cost for their beliefs can really be sure of how valuable those beliefs are. 

Liberals in Russia can be sure that liberalism is valuable and that their faith is pure. Liberals elsewhere cannot be so sure, which is troubling since, at its best, liberalism is a fight against the privileges that would lead one to give a political belief lip-service for personal gain. 

Liberalism Need Not Be Based In Consent

We may become the makers of our fate once we have ceased to be its prophets.

-Karl Popper, The Open Society and Its Enemies

 

In “Classical Liberalism: Contemporary Voices,” Patrick J Deenan stumbles upon one of my political pet peeves: The insistence that liberalism need be rooted in consent. He argues:

The affinity between liberalism and democracy is found most fundamentally in liberalism’s insistence upon consent as the only basis for legitimate power and authority. While in theory liberalism can accept any form of government, including a constitutional monarchy, from the very beginning, the architects of classical liberal regimes decided that periodic consent was the best means of ensuring ongoing legitimation. While John Locke speaks of the theoretical possibility of “tacit consent” as an ongoing basis on which to ground claims of legitimacy, as a practical matter, it is difficult for people simply to pull up stakes or foment a revolution when they decide that their tacit consent no longer suffices. Elections solve a practical problem, and liberalism became wed to democracy.

 

Especially when Mr. Deenan is advertising the rather lengthy and rambling essay to be a seminar about liberalism, to ignore the streams of liberal thought that have no relation to the idea that legitimate government is based on consent. The mistake is a compounded conclusion of a similar mistake about identifying the authors from whom the liberal tradition flows. Most important is whom he fails to consider.  

In his earlier article, “Liberalism Sources and Themes,” Mr. Deenan had boxed himself into that erroneous conclusion by arguing that that Locke and Paine are the fonts of classical liberalism. But what of David Hume and Adam Smith? David Hume had provided a timeless criticism of theories of government based on consent in “On the Original Contract.” The Scotsman even went so far as to write: “When we assert,that all lawful government arises from the consent of the people, we certainly do them a great deal more honour than they deserve, or even expect and desire from us.” 

Hume is certainly one of the font heads of liberal thought, so where does he fit in Mr. Deenan’s narrative. Short answer, he doesn’t and Mr. Deenan’s narrative therefore doesn’t capture the breadth of liberal thought.

 

The idea that any government, legitimate or not, is based on the consent of the governed is a laughably absurd idea and deserves to be shamed as such. As Hume writes in “On the Original Contract”:

The face of the earth is continually changing, by the encrease of small kingdoms into great empires, by the dissolution of great empires into smaller kingdoms, by the planting of colonies, by the migration of tribes. Is there any thing discoverable in all these events, but force and violence. Where is the mutual agreement or voluntary association so much talked of? 

Liberalism deserves to be taken seriously. By couching it in social-contract talk, we, almost by definition, fail to take it seriously. The social contract is an intellectual fraud. It fails to take into account that governments have a focal nature to them which, when legitimate, can properly demand the obedience of those in its jurisdiction. It doesn’t ask, it forces. 

Liberalism seeks to minimize that superior-inferior relationship that governments introduce into society, and to seriously go about that practice liberals cannot think that people have agreed to take the inferior role. Instead, they are there largely as a consequence of historical accident. Historical accident and fortunate violence, not consent, are what have formed the political institutions today. Any stream of political thought that contends otherwise doesn’t deserve to be taken seriously for the same reason that any biologist who believes that Genesis is the factual creation story doesn’t deserve to be taken seriously: Neither are true, neither conform to their given objects.     

An All Too Easy Target

 

Leave it to a physicist to butcher the economic point of view. In “Explaining How Economists Explain”, at Bloomberg View, Mark Buchanan takes an all too easy target in attacking economics for the unreliability of economic predictions. Despite the obvious target, Mr. Buchanan quickly strays from the truth of the situation by suggesting that economics needs to learn more from physics rather than accepting the limitations of its domain:

 Academic economists, they say, use the term "explanation" in a way that other scientists never would. Instead of developing realistic and testable theories like those in biology or physics, they often aim only to develop "theoretical cases" -- imaginary mathematical worlds with their own rules of cause and effect.

 

The notion that economists just choose not to make their theories testable and that they should choose otherwise, as Mr. Buchanan suggests, betrays a lack of appreciation of the demands placed upon economists. Today, economists are all too often employed as political engineers who are supposed to provide precise predictions for the course of different policies. One only need to look at The Job Impact of the American Recovery and Reinvestment Act, published on January 8^th 2009 to defend the then President Elect’s economic policies, to recognize that economists pretty much must fail at the task they are expected to fulfill:

 

A bit embarassing. No?

Christina Romer, a plenty capable economist, put her name on that prediction as the designated head of the President Elect’s Council of Economic Advisors. If she wasn’t in that position, in which she had to use economics to provide scientific oomph to Barack Obama’s politics, I doubt that she would’ve seen such a prediction as credible. But as an official of the elected government, Ms. Romer had to defend its policies and policies like the American Recovery and Reinvestment Act can’t be defended with humility. Promises are needed and economists are looked to give economic promises.  

So while economics has failed public policy again and again, it’s reasonable that it has. Too much is expected of it in the public sphere. Think about that the next time a talking head on TV makes a proclamation about what next quarter’s job growth is going to do. Yet, Mr. Buchanan falls into the same boat when he asserts that current practice of economics is “no way to design policies that affect the livelihoods of millions of people.” The correct point of view? Friedrich Hayek gets to it in The Fatal Conceit when he writes: “The curious task of economics is to demonstrate to men how little they really know about what they imagine they can design.” Rather than designing policies, the economic point of view can only demarcate the limits of what we can expect from policy.

  

To return to the methodological concern, economics does need to become more historical, but obsessing about testability won’t lead there. Emphasis placed on the made-up word ‘empirics’—a genuine butchery of the English language—passes over the problem that economists have to genuinely be interested in the social ecosystem they study. From that historical point of view, to simply suggest that the truth of a theory can be divined from some regression is to ignore just how causally dense an ecosystem is.  

Mr. Buchanan misses an opportunity to point out that whereas physics is based on necessity, economics, as well as biology, is based on contingency. Like the evolution of a biological ecosystem, the evolution of a social ecosystem is based on one accidental event after another. Just as the goal of biological science cannot possibly be why the evolution of an elephant was necessary, so too the goal of an economic science cannot possibly be why the Great Recession was necessary. The physicist may cry out in horror, but that’s simply the truth. Per Bak and Maya Paczuski take on this topic in their under appreciated 1995 paper, “Complexity, contingency, and criticality”.