Friday, January 19, 2018

Still the Best Bet


The size of government is shrinking, but never quick enough for my liking. I am a Jeffersonian at heart and entirely endorse the principle that “that government governs best which governs least”. The administrative state of elites, that permanent bureaucracy of busybodies who are not elected but nevertheless wield enormous power over every aspect of our lives, who think they know better than the rest of us, is being routed, little by little, but it won't be enough for me until there is a glut of empty houses in the plush bedroom communities of DelMarVa surrounding the Capitol.

We now have an administration in place that strongly believes in fruits of capitalism and a streamlined, downsized government of fewer regulations and less oversight. For much too long we have been under destructive, naive, and irresponsible leadership that believed that more government was the answer to managing the evolution of modern culture, steering our democratic republic ever closer to a socialist state. The self-righteous intelligentsia has increasingly held sway in the court of ideas with Benito Mussolini's belief that as a society becomes more complicated, individual freedoms need to be increasingly restricted.

Even though history demonstrates time and again that this kind of thinking has never been successfully implemented – never – the dream of a perfect collective world blooms afresh with each new generation. What is it about intellectualism that makes socialism so appealing?

From idealization to disillusionment we can trace the history of the various socialist experiments through an endless string of failed utopias – the Soviet Union, Cuba, China, Yugoslavia, Vietnam, Tanzania, and Nicaragua. It should work, it is reasoned, but it never has. Therein lies the fault of this fatal conceit. There is always a tiny elite in every emerging generation who believe without question that just by imposing their reason the desired outcome of a society that is at once prosperous and equitable as well as orderly and conducive to political liberty should result. The addiction to this conceit, however, has never been more than wishful thinking removed from reality.

One would think that in the wake of the very successful Reagan and Thatcher economic revolutions, capitalism would be embraced. Instead the revitalized capitalist polices of the Trump administration are viewed as maverick and threatening. The history of central planning demonstrates that it is the nursery for the growth of totalitarian policies. What begins as a conviction that for planning to be efficient it must be taken out of the realm of politics and placed in the hands of experts, ultimately ends with the failure of politics and the embrace of tyranny. Socialism always leaches personal initiative by denying personal liberty, very often deceptively disguising its efforts as humanitarian benefits.

Socialism is a version of sentimentality. The socialist, the sentimentalist, cannot understand why, if people have been able to generate some system of rules coordinating their efforts, they cannot also consciously design an even better and more gratifying system. The sentimentalist cannot understand why we shouldn’t favor cooperation (a nice-sounding arrangement) over competition (much harsher), since in any competition there are losers, which is bad, and winners, which may be even worse in their view. It is at this juncture that advocates of a planned economy introduce the word “fairness” into the discussion: Wouldn’t it be fairer if we took money from person A who has more than he needs and give it to person B who doesn't have enough?

Friedrich Hayek (The Road to Serfdom) called free market economics (capitalism) “the extended order of cooperation.” The seeming paradox of the free market, according to Adam Smith (The Wealth of Nations), is that the more individuals are given the freedom to follow their own dreams and means, the more their activities are “led by an invisible hand to promote” means that ultimately aid the common good. In other words, private pursuits advance public benefit. That is the beneficent alchemy of the free market. Hayek’s fundamental insight, enlarging Smith’s thought, is that the spontaneous order created and maintained by competitive market forces leads to greater prosperity than a planned economy - always.

The spontaneous order generated by market forces is beneficial to humanity in unexpected ways; it has greatly extended our lives and produced wealth so staggering that, only a few generations ago, it was unimaginable. The poor are still with us, and probably always will be. Not every social problem can be solved. Capitalism is working, however. Not perfect, but it is working. If there is a better way, I would love to see it. But it is not socialism. Been there, tried that.

Even a sound democracy that is thriving under free markets will suffer shortcomings. When these become most apparent citizens must be most wary of the sentimental appeal to trash the whole system in favor of intelligent central planning and rationalistic hubris. Hitler took advantage of the decay of democracy in Germany and at the critical moment obtained the support of a large enough contingent in society to roll to power supplanting an otherwise workable state with an ideological nightmare.

The urgency with which Hayek condemns socialism is a function of the importance of the stakes involved. As he puts it in “The Fatal Conceit,” the “dispute between the market order and socialism is no less than a matter of survival” because “to follow socialist morality would destroy much of present humankind and impoverish much of the rest.” We get a foretaste of what Hayek means whenever the forces of socialism triumph. There follows, as the night the day, an increase in poverty and a diminution of individual freedom.

The curious thing is that this fact has had little to no effect on the attitudes of the intelligentsia. No obvious empirical development, even repeated innumerable times, seems to spoil the pleasures of socialist sentimentality. This unworldliness is tied to another common trait of intellectuals: their contempt for money and the world of commerce. The socialist intellectual eschews the “profit motive” and recommends increased government control of the economy. He feels, Hayek notes, that “to employ a hundred people is . . . exploitation but to command the same number [is] honorable.”

The Marxist theorist and Soviet politician Leon Trotsky got it right when it comes to summing up the impact of socialism upon any society, observing that when the state is the sole employer the old adage “he who does not work does not eat” is replaced by “he who does not obey does not eat.” As the old Soviet Union struggled desperately to make socialism work there was less and less work and more and more worthless pay. “They pretend to pay us,” one worker said, “and we pretend to work.” The only equality Vladimir Lenin and his heirs achieved was an equality of misery and impoverishment for all but the elite central planners.

The American experiment of the last 242 years is like a boat that is always taking on water. It doesn't want to go down no matter how bad the storm, as other boats around it come and go with the crashing waves. But it sits high enough on the water that no matter how insurmountable its problems appear to be, the passengers know they are going to get there. “She is a good old boat and she'll stay afloat through the toughest gale and keep smiling.” If the sentimentalists all go to one side of the boat in an attempt to upset the balance, we need to send them below decks to the engine room to shovel coal until they come to their senses.

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