The October Revolution reaches 100

What have socialists ever done that would make anyone think they care about other people? For myself, I cannot think of a thing. Socialist ideas have never, not in a single instance, not at any time in the whole of its history, improved the lives of the communities they ruled. Other than for its leaders, socialism has only caused misery for anyone who has been trapped inside a socialist regime.

This post is a reminder of what cannot be denied other than by liars or those with not a shred of historical memory, written in commemoration of the 100th anniversary of Russia’s still celebrated October Revolution which was once the centre of a worldwide faith in a glorious future, that is, a glorious future once the tens of millions of regime opponents had been eliminated, driven into the gulag, or terrorised into silence. And while it was the “October” Revolution, that was old calendar, but in the new calendar that is the date we have now reached.

October Revolution, also called Bolshevik Revolution, (Oct. 24–25 [Nov. 6–7, New Style], 1917), the second and last major phase of the Russian Revolution of 1917, in which the Bolshevik Party seized power in Russia, inaugurating the Soviet regime.

Socialists seek political power by pretending they have answers to genuine problems but never do; they only make such problems infinitely worse. We will never be rid of problems, nor will we ever be rid of people who will tell you that if only they are put in charge, our problems would go away. Any community in which the majority of its population are unaware of this massive danger to their future lives is in perennially danger of falling into the abyss of a socialist governing clique taking power.

Here is the reality. The socialist left is filled with people whose lives are driven by envy and hatred for the productive, contended and self-reliant. Ruining their lives makes no one better off but does lay to waste the lives of everyone involved, other than those who take power. No one can any longer be unaware that every socialist so-called solution to our existential and economic problems has been disastrous for everyone but those who seize power. Every socialist leader is a Stasi agent lying in wait.

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Q&A Forum: October 23, 2017

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The public cost of supporting those who game the welfare system

This is how the welfare system works: it is as if someone has moved into your house, uses your kitchen, bathroom and one bedroom, but doesn’t contribute to the groceries or help to pay the rent. There may be reasons to allow this: sick relatives, friends who are down on their luck or because of a charitable streak in the owner of the house. But whatever else, this outlay does draw down on what is available to everyone else and leaves those who offer the welfare less well off than they otherwise would have been.

Most societies have offered welfare assistance to the sick, the disabled, the elderly or others who cannot provide for themselves. But they have also always limited the amounts provided for a number of reasons including the ever-present possibility that some of those receiving welfare could be earning their own incomes and contributing to total output, instead of taking from the earnings of others while putting nothing back in.

I say all this because of an article that showed up on the front page of the Herald Sun this morning: Warning over booming Australian welfare bill. From which:

TAXPAYERS are coughing up $300,000 a minute for a welfare bill that has soared $40 billion in 10 years.

The Herald Sun can reveal that the total lifetime welfare bill for all those currently receiving benefits has been estimated at $2.1 trillion.

The frightening figure emerged as federal government debt reached a record $506 billion yesterday, renewing concerns about the public cost of supporting those who game the system or are locked into a cycle of welfare dependency.

Remarkably, anyone currently receiving government help to study is expected to be on welfare for nearly half of the rest of their lives, costing taxpayers an average of $247,000.

This is the equation showing in miniature how out ability to spend works:

Income Earned – Taxes Paid + Welfare Payments Received

There is no reason in any particular instance that Income Earned minus Taxes Paid will be greater than Welfare Payments Received. Especially if for those receiving welfare are able to keep Taxes Paid to a minimum relative to Hidden Income Earned.

Welfare should not be a way of life, but assistance given when it is needed and only then. But now that Voting for a Living has become a viable alternative to Working for a Living, the constituency to do something about what is shown by these latest studies on our exploding welfare bill may no longer exist.

Not everyone on welfare is gaming the system, of course. But not every payment on welfare is legitimate either.

Posted in Australian Story, Wasteful Spending | 54 Comments

Jeffrey A. Tucker: An Aesthetic of Liberty

Liberty-minded people are doing a lot of soul-searching these days. It’s probably needed.

In case you haven’t heard, many academic and media observers are on a hunt to discover the origin of the bizarre and violent alt-right (Klan, Nazi, and so on) marchers and protesters who appeared in Charlottesville, Virginia, shouting genocidal slogans. Every day new stories appear. To the horror of many dedicated intellectuals and activists in the liberty space, some journalists have tried to link this movement backward in time to the libertarian political movement as it developed over the last decade.

Some of the most prominent alt-right voices in Charlottesville once identified as libertarians. 

It should be obvious that, in theory and contrary to what the socialist left has long claimed, there is no connection whatsoever between what we call libertarianism and any species of rightist totalitarian ideology. One negates the other. As Leonard Read wrote in 1956, “Liberty has no horizontal relationship to authoritarianism. Libertarianism’s relationship to authoritarianism is vertical; it is up from the muck of men enslaving man…”

And yet today, there does indeed appear to be a social, institutional, and even intellectual connection, and migration, between what is called the liberty movement and the alt-right. Some of the most prominent alt-right voices in Charlottesville once identified as libertarians. This fact has been widely covered. It’s a fair question to ask: did these individuals ever really believe in a liberal worldview? Were they trolling all along? Were they just deeply confused?


I’ve been interviewed many times on these questions. How did this come to be? The answer is complex.

The rhetoric at the extremes approaches nihilism.

It was more than three years ago that my article “Against Libertarian Brutalism” raised a conjecture: a libertarianism, rendered simply as nothing more than a “leave me alone” outlook, with no larger aspiration for the good life, could find itself divorced from a historical conception of what the advent of liberty has meant to human life and society as a whole. Without that, we fail to develop good instincts for interpreting the world around us. We are even reduced to syllogistic slogans and memes which can be deeply misleading and feed even illiberal bias.

And where does this bias end up? Where are the limits? I see them daily online. In the name of fighting the left, many have turned the other direction to embrace restrictions on trade, migration, essential civil liberties, and even toyed with the freedom of the press and the rights of private enterprise, in the name of humiliating and eliminating the enemy. Some go further to celebrate anything they believe the left hates, including even odious causes from the authoritarian past.

The rhetoric at the extremes approaches nihilism. The press isn’t really free so why not impose restrictions and censorship? The borders aren’t private so why not prohibit all entry? Some speech doesn’t support freedom so why permit it the rights that freedom entails? Social media companies aren’t really private enterprises, so why not force them to carry and promote some accounts that I like?

Small Mistakes, Big Results

It takes a special kind of circuitous sophistry to justify, in the name of liberty, collectivistic animus and state violence. 

The gradual evolution of language has unleashed all kinds of confusion. Activists denounce “the establishment” without a clear distinction between government and influential media voices. They will decry “globalism” without bothering to distinguish the World Bank from an importer of Chinese fireworks. They promote identitarianism and racial collectivism without the slightest understanding of the illiberal origins and uses of these ideologies in 20th-century history. After all, they say, there is nothing “inherently un-libertarian” about casting down an entire people, religion, gender, language, or race, so long as you don’t directly use violence.

It takes a special kind of circuitous sophistry to justify, in the name of liberty, collectivistic animus and state violence against voluntary association. But the history of politics shows people are capable of making huge mental leaps in service of ideological goals. All it takes is small steps, little excuses, tweaks of principle here and there, seemingly minor compromises, some element of confirmation bias, and you are good to go, ready to make as much sense as the old communist slogan that you have to break eggs to make omelets.

Public and Private

Here is an example of what I mean. I’ve heard many libertarians postulate that public spaces ought to be managed in the same way private spaces are. So, for example, if you can reasonably suppose that a private country club can exclude people based on gender, race, and religion – and they certainly have that correct – then it is not unreasonable to suppose that towns, cities, or states, which would be private in absence of government, should be permitted to do the same.

In fact, it has been claimed, the best kind of statesmen are those who manage their realm the same way a CEO manages a corporation or the head of a family runs a household.

What is wrong with this thinking? It is perhaps not obvious at first. But consider where you end up if you keep pursuing this: there are no more limits on the state at all. If a state can do anything that a private home, a house of worship, a country club, or a shopping center can do, any state can impose arbitrary rules, conditions of inclusion, or codes of speech, dress, and belief, including every manner of mandate and prohibition, the same as any private entity does. Such a position essentially belittles 500 years of struggle to restrain the state with general rules, from Magna Carta to the latest rollbacks in the war on drugs.

How can libertarians again find our center and enliven our mission? 

The whole idea of the liberal revolution is that states must stay within strict bounds – punishing only transgressions against person and property – while private entities must be given maximum liberality in experimentation with rules. This distinction must remain if we are to keep anything that has been known as freedom since the High Middle Ages. Through long struggle, we managed to erect walls between the state and society, and the struggle to keep that wall high never ends. The notion that public actors should behave as if they are private owners is an existential threat to everything that liberalism ever sought to achieve.

This is a case that illustrates how easy it is to get off course through small intellectual confusions. As the old Scholastics said, you get one point wrong, and follow it consistently enough, next thing you know, an entire worldview unravels. Then you are vulnerable to every manner of manipulation and even corruption, even to the point of marching in parades for totalitarian causes.

This type of intellectual confusion is what enabled and encouraged the migration from libertarianism to the alt-right. It was a failure to see the big picture of what it is that human liberty is all about, and this failure, fueled by anger, opened up many people to a dark world they didn’t know or understand.

A Way Out and Forward

How can libertarians again find our center, enliven our mission, feel great about what we do, and protect ourselves from ever again being trolled by evil?

Here is my suggestion: we need a new aesthetic of liberty. This new aesthetic should replace the barren and politically malleable abstractions that have robbed libertarianism of its bigger and larger vision and made people unable to see when a movement turns in an illiberal direction.

We need to form in our minds a beautiful vision of the society and world we want to inhabit, not in its detailed operation like the central planners, and not as an end state like the socialist utopians, but in its ever-evolving institutions that serve human well being above all else. We need to sense it, see it, get to know it in our minds, love it and long for it, and help others see it too, just as our greatest writers and intellectuals in the past have done.

This must begin with rethinking who we are in light of where we’ve been in past ages and form ideological personalities that resist being manipulated by the political actions and reactions around us.

This liberty aesthetic consists of five main parts.

First, we need a bright outlook on human progress. The big picture is that before the age of liberalism, humanity slogged around for some 150,000 years without hope, improvement in living standards, or better or longer lives. Then freedom came. Hope was born. In your own life, you could manage to create improvement. You could live better. You could cause the world around you to adapt to new conditions. You could improve the lives of others. To be volitional meant something for the first time. You could travel. You could earn money and buy things. You could invest, and hope for a better life for your children. To have hope in this world, and not just the next, was the great gift of liberalism to the world.

Formal alliances between libertarians and others have been the source of great mischief for decades.

We cannot and should not give this up. Anger, bitterness, resentment, and hate are just not good substitutes. On the contrary, they are corrosive of the heart and soul. In the days since Charlottesville, I’ve had many discussions with people who are shaking off an alt-right phase. The number one thing they have told me: “I was consumed and blinded by anger. It caused me to lose sight of the beauty of liberty.” This leads me to believe that avoiding this cast of mind could provide some immunization against illiberal thought.

Second, we need to stop believing that the enemy of our enemy is our friend. Formal alliances between libertarians and others have been the source of great mischief for decades. There is nothing wrong with cooperating with people from many sides of the political spectrum for the good of liberty. And there is not much point in regarding libertarians as some kind of hermetically sealed group, protected from outside influence. Formal alliances are another matter. These can tempt people to distort priorities, bury principles, and embrace insidious ideas, all in the interest of preserving the alliance.

This is a particular problem in the area of politics. You hate candidate A and don’t particularly like candidate B. But your loathing of A is so strong that you come to back, even passionately, candidate B. Once having backed B, you continue to confirm your bias by cheering everything he or she does following the election. This tendency can rot the brain and debase one’s principles to the point that you no longer remember what it is you actually believe.

A general preference for peace over violence is not put into some algorithmic theorem that is set apart from real human experience.

Third, we should hope for more peace and less violence. The liberal revolution began with an insight: the costs of religious wars are too high. How about we just let everyone believe what they want to believe providing he or she does not impinge on the rights of others to do the same. And guess what? It worked. This set up a general curiosity toward the uses of peace or violence. Next came freedom of the press, freedom of association, freedom of trade, freedom of movement. It was beautiful and amazing.

Reflecting on this history, F.A. Hayek sought to sum up the libertarian spirit as a preference for peace over violence, whether that violence is from private actors or the state. This is why libertarians have a high regard for the commercial sector of life. So long as there are clean lines of ownership and the possibility of trade, people are in a position to get a bite to eat and put clothes on their backs without having to kill each other. This makes for a better society.

Note that this general preference for peace over violence is not put into some algorithmic theorem that is set apart from real human experience. Nor does it enable some ivory-tower theorist’s perfect insight to solve every human problem. The manner in which the rule of thumb applies needs to be tested according to the circumstances of time and place, and the results judged by a market test.

We will win the day because we have the arguments.

Fourth, we should be wary of mass hysterias and populist agitation. Liberty has been vexed as much by public frenzy – against the greedy bankers, the weird religion, the foreign enemy – as by dictators. Much of the time they work together to curb the liberties of the people, as demagogues use mass movements (or insiders use ambitious leaders) to obtain power. When you see mobs of people gathered and screaming, and some leader behind a microphone yelling, and the anger reaches a fevered pitch, you can have a sense that it is not liberalism at work here.

Ludwig von Mises in 1927 noted this at the end of his great work on the free commonwealth. He said that liberalism can be recognized not by flags, songs, marches, and uniforms but by its reasoning. We will win the day because we have the arguments. I’ve put my faith in the belief that he is right, and only add that Mises himself was never more convincing than when he described in beautiful prose the glorious achievements of freedom in the past and its marvelous potential for the future. 

Fifth, we need a central theme that is beautiful and inspiring. What is the central theme of the aesthetic of liberty? It is this: emancipation. This has been our great contribution to humanity. It was the libertarian idea that brought about emancipation from rule by dynasty, from feudalism, from mercantilism, from theocracy, from slavery, from institutional misogyny, from censorship, from war, from all forms of state control.

The world desperately needs a new and conscious movement that is devoted to a classical form of liberalism.

And what are we working toward? What has been the point of all this progress made toward liberty in the past? It is about the aspiration for universal human dignity. That’s the theme and the test. Does what I believe ennoble human life? Does it create conditions for greater dignity and opportunity for all? Does it make life better for others and myself? These are the questions we need to ask ourselves about everything we believe and do in the name of liberty.

If we get this straight, prefer peace to violence, adhere to principle, and rely on argument and not on noise to win the day, the rest will take care of itself.

A New Enlightenment 

Why does it matter? People are being misled. They believe that the alternative to the left is the right, forgetting that both paradigms emerged from the same anti-libertarian framework that opposes the greatest transformation in the history of the human race.

Actually it’s worse than that: our generation is not entirely aware of what they are buying when they rally uncritically (but understandably) around anti-leftist causes without asking what these causes are actually for. They rally around fashionable memes and follow articulate leaders and, one day, find themselves carrying ethnostate flags and screaming blood-thirsty slogans. Further, they come to imagine that freedom can be achieved through statist means. It has never been so!

None of this has to be. What the world desperately needs a new and conscious movement that is devoted to a classical form of liberalism, applied in the 21st century. This movement (however informal and focused more on ideas than organizing) should be enlivened by ideals. It should optimistically celebrate free enterprise, trade, and peace and recognize that the magic of freedom is revealed most profoundly in its capacity to create harmony out of diversity, strong cultural ties out of spontaneous association, and prosperity from the creative actions of individuals in an open-ended social order. It needs to recognize that liberty is about building a good society in which everyone can thrive in peace.

Such a movement needs to detach itself from the war between right and left, eschew the hatreds and revenge fantasies fueled by today’s political struggles, and instead embrace a liberty aesthetic as a path that transcends modern politics and offers pure light in an otherwise dark world. Let the soul searching begin, and then let us proceed forth to building a better, freer world. 

Jeffrey A. Tucker

Jeffrey A. Tucker

Jeffrey Tucker is Director of Content for the Foundation for Economic Education. He is founder of, Distinguished Honorary Member of Mises Brazil, economics adviser to, research fellow at the Acton Institute, policy adviser of the Heartland Institute, founder of the CryptoCurrency Conference, member of the editorial board of the Molinari Review, an advisor to the blockchain application builder Factom, and author of five books, most recently Right-Wing Collectivism: The Other Threat to Liberty, with a preface by Deirdre McCloskey (FEE 2017). He has written 150 introductions to books and many thousands of articles appearing in the scholarly and popular press.

This article was originally published on Read the original article.

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Monday Forum: October 23, 2017

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Robert Mugabe health envoy

The World Health Organisation is appointing Robert Mugabe, the tyrant of Zimbabwe, as its goodwill ambassador for health. This is absolutely bizarre.

In a meeting held at Victoria Falls of the WHO Regional Committee for Africa, the Director-General of the WHO,  Dr  Ghebreyesus who only took his position in May 2017 said

Thank you for your hard work and dedication to our noble cause. And thank you, Your Excellency President Mugabe, for joining us despite your busy schedule. This shows your strong commitment to health, and we value that, for coming all the way from Harare to join us. Please accept, Your Excellency, my greatest respect and appreciation. … Thank you for accepting my offer to be the WHO’s goodwill ambassador.

The latest reports show that the WHO is ‘rethinking’ its nomination of Mugabe, but the damage has been done. They may as well appoint Kim Jong-Un as a goodwill ambassador.

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NZ the next Venezuela

The stupidity of some people plumbs depths that are always hard to fathom. Is it really all that hard to learn from history? Jacinda Ardern: ‘Capitalism has failed New Zealanders’. Listen to this bewildering idiocy and marvel how someone can remain so ignorant in the midst of a world of socialist horrors.

New Zealand prime-minister-elect Jacinda Ardern has described capitalism as a “blatant failure” in the country, nominating poverty and homelessness as her priorities when she takes office.

Speaking in her first sit-down interview, on TV3’s The Nation, Ms Ardern said New Zealanders were not feeling the benefits of prosperity. Asked if capitalism had failed New Zealanders on low incomes, Ms Ardern was blunt: “If you have hundreds of thousands of children living in homes without enough to survive, that’s a blatant failure. What else could you describe it as?”

“When you have a market economy, it all comes down to whether or not you acknowledge where the market has failed and where intervention is required. Has it failed our people in recent times? Yes.

“Wages are not keeping up with inflation (and) and how can you claim you’ve been successful when you have growth at roughly 3 per cent, but you have the worst homelessness in the developed world?”

Such fantastic ignorance. From the comments, as always starting from the best and working down.

Doesn’t she realise that capitalism gave her a home, a culture and welfare. Capitalism gave her a car, electricity and water. Socialism gives you depression, greed and envy. Poor NZ, descending into an abyss.

“Capitalism is a blatant failure”..Well, goodbye New Zealand, you’ve really done it now.

Heaven help New Zealand if they are her first comments. Capitalism produced the clothes she wears and stopped her from dying from polio and other childhood diseases. Perhaps she should read Alexander Solzenitsyn.

After 9 prosperous years, sure, Capitalism is a failure. What a dope. Of course, socialism has worked everywhere, hasn’t it?

If capitalism is such a blatant failure, perhaps Jacinda could name one socialist or communist country that has done better? Didn’t think so.

The ACT Labour Party has been in office for 15 years. The voters of the ACT keep electing them because the Canberra Times and the ABC continue the narrative that all opposition politicians are hopelessly inept. How the all-knowing left-leaning journalists have determined this is not clear. Regardless, the voters clearly believe the Canberra Times and the ABC. Do you know why am I telling you this? The ACT Government, the most socialist government in Australia, in coalition with the Greens, claims to support the homeless and the poor. Yet the ACT has thousands of homeless, sleeping rough around the city (Civic), begging in the suburbs, sleeping in surrounding bush land, couch surfing. ACTEWAGL has dramatically increased Electricity prices, but this pales alongside their increase in Gas prices. We had a $1,300 Gas Bill this past quarter. Thankfully we could stretch to pay it. But in the coldest capital on the mainland, many families have turned off the electric and gas heating this winter. The ACT had at least one death from influenza this winter. Jacinda Ardern is politically naive to assert that the problems of homelessness and poverty are due to capitalism or conservative governments. Like the ACT Chief Minister Andrew Barr, she lacks real-world experience. Like Barr, she has never had a normal job after university student politics, having worked as a political staffer or adviser before gaining selection for a safe Labor seat. Never run a business, never been an employer, probably never balanced a budget.

Where does she think the money she is about to pour down a black hole of welfare, comes from? Oh man, this is going to be fun to watch.

The problem with Socialism is that you eventually run out of other people’s money.

“The inherent vice of capitalism is the unequal sharing of blessings; the inherent virtue of socialism is the equal sharing of miseries.” Winston Churchill.

God, who cares what this person thinks. Capitalism and democracy has been around for centuries, but Jacinda, barely out of wearing nappies, is a master of the universe?? No doubt she will be highly exalted by the ABC, Fairfax, Guardian, and the rest of the marxist media elite.

Sounds like two generations of debt coming up. Why does any Labor Government equal fiscal vandalism.

Ardern sounds like a really naive and idealistic socialist. She has claimed that she will reduce NZ’s carbon footprint. As one of the biggest contributors to the carbon footprint in NZ is agriculture, which also happens to be a major export earner, it might be time for farmers to sell up and move elsewhere. The damage that an idealistic socialist can do to a country has been demonstrated elsewhere, for example Venezuela.

Wait and see how much poverty you have in a couple of years after you’ve tried socialism.

God help Leninist New Zealand. All the good work of Keys about to go down the drain.

May as well tell us that gravity is a failure because a bridge fell down somewhere. Capitalism is reality and you either recognise it and deal with it or you go the way of Venezuela.

Capitalism a failure? A system that has created wealth and prosperity unlike anything since the dawn of civilisation? Sorry New Zealand but you’ve gone and stuffed it – this mob is going to destroy your economy.

Capitalism does work, the market works. As long as a suitable welfare system is there to support the vulnerable, the genuinely disabled and mentally ill – it is the best system.

Welcome to NZ a once brilliant country now going down the Socialist/ Marxist path of destruction just like Victoria.

Socialism is something you can do when someone else as has saved enough money. Communism is something you can do when you have enough guns. Jacinta is a socialist. She will soon spend NZ back where they came from 10 years ago. Then, like Kevin 07, no one will admit to voting out a perfectly competent government. Carry on KIWI.

Here we go again. The conservatives spend years being prudent, then the public thinks it might be a good idea to vote themselves some free stuff. Ghod help NZ.

Of course, Jacinda has lived in a successful socialist state to provide this comparison? Oh that’s right, there are no successful socialist states, they are just totalitarian.

And so it begins. In an effort to appease all the little people, the taxes will presumably go up on important things like housing and fuel, and those people will be worse off, even if they get a minimum wage increase. By the time NZ labor are booted out of office, id happily wager theyll be in debt.

The siren song of socialism is that it provides lotsa goodies paid for with other people’s money.

Oh NZ you are in for a world of pain!

And that was every comment so far with not a one left out. The only positive is that the NZ example will be a reminder here why socialists should never be elected.

Posted in Economics on the left, Politics of the Left, Socialism | 95 Comments

Roundup Oct 21

The cost, supply and use of power across the states. Coal-fired power Units Planned and Under Construction. China 583, Australia 0. Don Aitkin on the Clayton’s energy policy.

Hot off Jo Nova’s press, the games the Bureau of Meteorology plays with the temperature records. I wonder why? Jo Nova on Malcolm Turnbull’s “game changer“. Strangely unimpressed!

Alternative ideas. Weekly roundup from Heterodox Academy, the organization started by Johathan Haidt of The Righteous Mind. Mission: To improve the quality of research and education in universities by increasing viewpoint diversity, mutual understanding, and constructive disagreement. Intellectual Takeout. Accuracy in Academia. The American Scholar Inside the house that Stalin built.

Dan Mitchell. The impressive record of Ronald Reagan. The left really want higher taxes for middle income earners, not just the rick, they know they cant get what they want from the rich alone. On President Nixon, big on spending and regulation. He kicked off the War on Drugs for example.

The top tax rate on labor and small business income was reduced from 70 percent to 50 percent as part of the Tax Reform Act of 1969. I would have included that law in the pro-growth column, except that was the legislation that also created the alternative minimum tax (for both households and corporations). And there was an increases in the tax burden on capital gains, as well as a more onerous tax regime for new investment. My assessment is that these bad provisions basically offset the lower tax rate.

Local. Mannkal Get Involved! Centre for Independent Studies, Ideas: Thoughts on Gonski, free market solutions for problems and Indigenous service structures. IPA Weekly What Did I Miss?

Books. Abe list of mystery writers. Judging from the comments it seems that a lot of good ones were left out! What about some Australians?

Robots. A piece by Peter Smith on the power of markets to handle the rise of robots.

Sites of Cat threadsters. People who missed out, please complain in comments!
cementafriend Beer Whisperer dover beach Serena at the Pub Carpe Jugulum Millenium Transmissions Bemused

For nerds. The Inner Lives of Markets.

The book is a lively discussion of what one might call the “greatest” theoretical hits of economics. Starting from the early 20th century, Fisman and Sullivan review a number of the major insights from the field of economics. The goal is to give the average person a sense of the interesting insights that economists have come up with as they have worked through various problems such as auction design, thinking about social welfare, behavioral economics, and allocation in a world without prices.

I’ve taken a bit of economics in my life, and I’m somewhat of a rational choicer, so I am quite familiar with the issues that Fisman and Sullivan talk about. I think the best reader for the book might a smart undergrad or a non-economic social scientist/policy researcher who wants a fun and easy tour of more advanced economics. They’ll get lots of interesting stories, like how baseball teams auction off player contracts and how algorithms are used to manage online dating websites.

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What happened to good policy in the ALP?

Sharing some fugitive thoughts before starting the seriously nerdish business of the day and the Roundup Oct 21.

Update, something I couldn’t find this morning, the press cuttings attacking the New Right in the 1980s.

Remember the time when Hawke and Keating and the Cabinet of the time were doing some of the things that the Backbench Dries in the Coalition wanted to see on the policy table? The point of this meditation is to work out how come sensible ideas about economic management never penetrated into the Labor woodwork. My suggestion is that apart from some efforts to explain what had to be done, political rhetoric was directed powerfully against anyone outside the party who looked like an economic rationalist and so the party faithful would have gained the impression that free enterprise and classical liberals were still mortal enemies of the people. Something like that has probably happened in China where the leadership has done some of the things required for economic strength without any audible or visible recognition of the power of freedom and markets.

The rank and file of Labor voters signalled their hatred of economic rationalism when some Labor strongholds fell to the Coalition in Griener’s 1988 landslide. The NSW Liberals may have thought they were suddenly very popular but it was really a big finger from Labor voters for the economic rationalism of their party in Canberra.

For a short time (I wonder how short?) there was a bipartisan stand at the Federal level on some important issues although of someone wrote in CIS Policy that the Labor party only wanted better economic performance to fund their Big Government agenda.

After some heroic policy development in opposition, led by the likes of John Hyde (not in the House at the time of course) the Coalition went to the polls in 1993 with the best policy platform that we will ever see (and possibly most inept leader as well, going a bridge too far with the GST which Keating had once wanted to implement).

That was the election when I first realised the incredible depth and passion of anti-Coalition sentiment in the media at large, and so the Coalition lost the unlosable election. In the aftermath the party walked away from the policies that they worked so hard to develop, as though they had got it wrong and not the electorate. Obviously they had to regroup, but not at the expense of trashing the work they did to develop good policy. (The same thing happened with WorkChoices, which was buried the day after the election, instead of pointing out the way it worked and the dishonest way that it was trashed by the rusted-on Labor supporters in the commentariat.)

At that point in 1993 it looked as though there would never be another conservative government in our lifetime but Keating turned his back on the Labor base and that was just enough to get Howard over the line more than once.

Going back to the ’80s and ’90s which was the starting point for this meditation, looking through my press cuttings from the time, it is amazing to see the passionate resistance mobilized on both sides of politics against the dreaded New Right of the free enterprise movement. A battle had to be fought in the IPA to convert the old guard of protectionists.

I wrote at the time that four groups of people confuse the issues. These are the ‘do nothing free marketeers’, the conservatives, the ‘dries’ in the Labor Party and the socialist intellectuals. Malcom Fraser and Joh Bjelke Petersen are examples of ‘do nothings’ who mouth the slogans of free enterprise but in fact do not open up markets or dismantle controls and regulations. Hence rationalism is discredited before it is even tried. The conservatives do not even pretend to support free markets though they claim to oppose socialism, often while they support de facto socialist policies (i.e. the old rural socialists of the Country Party). The Labor dries share many aims of their Liberal counterparts but they are obliged to be especially severe on the ‘New Right’ to deflect criticism from the Left of their own party. And the intellectuals of the Left are so blinkered by their ideological assumptions that they have not started to grasp what Hayek and the market liberals are talking about. I could tongue in cheek throw in an extra group, the Randoids who I sometimes describe as speedbumps on the road to serfdom because they might put their bodies on the line to defend freedom they will not explain the benefits of free trade and markets in language that the median or even the average voter can understand.

The point is that the people in the street were not getting a straight feed on economic rationalism from any party or influential group even while the Hawake/Keating government was doing some of it. I was particularly interested to see the attacks on economic rationalists from members of the Hawke Cabinet who would have known better. And the NSW swing against Labor in 1988 was a big pointer although I don’t think it was picked up that way at the time.

The bottom line is that we don’t need to be surprised that the Labor party stopped doing economic rationalism, we just need to be amazed that they ever did it. Much the same can be said for the other lot.

Posted in Economics and economy, Rafe | 18 Comments

Open Forum: October 21, 2017

Posted in Open Forum | 1,076 Comments