One Liberty To Rule Them All


Dave has an interesting post, including our different definitions of liberty: cosmopolitan, religious, utilitarian, and libertarian. While they are indeed "mutually contradictory," it's a big selling point that by pursuing the libertarian idea of liberty, you get decent dollops of the others, if you want them. We could call this the "one ring to set them all free" theory.

Libertarian liberty (LL) does pretty well at achieving cosmopolitan liberty. Say you care about absolute wealth not at all, only about equality of opportunity (EO). While some tribal societies accomplished a remarkable equality of result, EO was never a feasible political program before the IR and capitalism enabled us to afford massive wealth redistribution. Otherwise, you just alternated between feudalism and occasional retaliatory decapitation (England 1381, France 1792). Maybe there was EO in Sparta, if you don't mind militarization or infanticide. Oddly enough, though, most leftists do.

Fast-forward to today. Now, if you want EO down your throat, all you have to do is learn Swedish. Or if you're Rawls, and care only about the poorest in society: well, they might better off in Sweden than America, but they're way better off here than in India. So some capitalism is still good, and even better the more you care about absolute wealth.

And LL does all right for people who want liberty to conform to a discovered ideal, at least as long as it's a Western religious one. Why? Any religion that puts value on free will (most Western religions) must, to be consistent value systems, allow people to do the wrong thing without harming, morally or spiritually, others. In short, people must be free to sin.

Take the Amish. Before the decision to be be baptized, teens are permitted to go into the wider world and experiment. It’s not smiled upon, but is permitted. After being baptized, they must shun such influences. But the Amish offer what is vital in any non-Calvinist Christianity: the choice to accept God, or not.

So if doing wrong is a sin, but people should be free to sin, what are optimal laws? I don’t think “we should ban porn and prostitutes” is a necessary conclusion; I think it’s just the zealous legislating their own – excuse me, God’s – preferences onto others.

My perspective? To paraphase an old libertarian parable, if soldiers enter your home and force you to pray to Mecca (Jehovah, Shiva) daily or die, you aren't free to be a Muslim. You can only be a true Muslim (Christan/Jew, Hindu) when they quit harassing you and you get to decide for yourself. Unfortunately, I don’t think many of my co-religionists see it this way.

And libertarian liberty aces the test on utilitarian liberty. The free market is the greatest good for the greatest number, in the long run at least. So maybe minus one. (IMHO, Confucianism belongs in the previous category)

More into the orgins of GGFGN: whatever the tendencies of JS Mill towards elitism (see Sowell), his political program is squarely libertarian. And Hayekian traditionalism - the idea we should lean toward accepting what is because it was shaped by processes smarter than any one person or group, meanwhile strengthening such weeding-out forces through the free market and decentralization - is rule-utilitarianism par excellence.(yes, hair-splitters, I know utilitarianism was too rationalistic for Hayek's tastes. the general point stands.)

So if you pursue libertarian liberty, there are some trade-offs after a point, sure. But that's far from it being contradictory to the others.

And of course, something else we can use as a selling point is decentralization. Alabama has its liquor laws, Scandinavia its cradle-to-grave welfare. Libertarians don't like either, but we (should) prefer the status quo to a scenario where either or both population was forced to change its laws by a higher governing authority. Thus, if you adopt one of the other definitions of liberty, legislating your preferences causes the least harm possible, by confining it to a mostly supportive community. Unsurprisingly, none of the other perspectives agrees here.

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Rawls?

A very enjoyable post Sam, but will you be reading A Theory of Justice any time soon? If you do, you'll find that saying Rawls 'cares only about the poorest in society' is a mischaracterisation in two ways. First, the difference principle, to which I'm guessing you are referring, is subordinate to a liberty principle which guarantees equality in the distribution . Second, the difference principle - that deviations from strict equality have the effect of making the least well off better off - is, as you point out, entirely consistent with a market economy, even if it's probably inconsistent with unfettered capitalism. Rawls does seem to think that a just society is one that attends to the least well-off first, but that's different to saying he only cares about the least well-off.

Apart from that, implying that it's ok that the poor are better off in Sweden than they are in the US because they're better off in the US than in India just doesn't wash. It's like saying that it's OK that I beat my kids with a rod because the guy across the road beats his with a tyrejack.

And, while I agree that some capitalism is good, I can't for the life of me see how the (itself flawed) Sweden-USA-India logic is a reason some capitalism is good. I've been to Sweden and lo-and-behold, it does have a market economy. India also has a market economy, and it seems strange (when it would be easier to point elsewhere (to give one pretty strident example)) to think that India is poor simply because it's somehow capitalist enough.

India, Sweden, US

India also has a market economy

Even the Soviet Union had a market economy, if you lower the cutoff enough. Since everybody has a market economy to some degree, however minuscule, a better question than, "does it have a market economy", is, "how much of one does it have", or in other words, "how much economic freedom does it have?" That's what the Index of Economic Freedom is for.

2007 Index of Economic Freedom

Scores: (higher is freer)

United States 82.0

Sweden 72.6

India 55.6

China 54.0

Admittedly the current freedom is only a small factor. The wealth of a country depends on its history, and only slightly on the present day. So let's look at an earlier slice:

1995 Index of Economic Freedom

United States 76.6

Sweden 63.9

India 46.4

China 52.1

Keep in mind that 1995 is after India abandoned socialism, so it does not reflect the longer term situation. That abandonment is briefly mentioned here.

As one Indian put it, rather smugly: "The news these days from Pakistan is of jihadis blowing themselves up, often in distant lands. The news from India is of call centres taking jobs away from people in distant lands. A big change from the past."

Until about 10 years ago, when India, under World Bank pressure, opened up its economy and abandoned socialism, it was Pakistan, more wedded to the free market, that was ahead economically. Its per capita income was higher and its elite freely able to travel abroad, flushed with foreign exchange money.

To date India's abandonment of socialism more closely:

The group quickly entered new businesses after 1991, when India abandoned socialist policies and allowed private firms in sectors reserved for state-run firms or were exclusive domains for select private companies granted licences by the government.

A country's wealth takes several decades to build up, so that the economic policies of a country ten or twenty or thirty years ago will still have an impact on the country's current level of wealth. So it is reasonable to say that India's socialism prior to 1991 is probably still a significant factor in its relative poverty, on top of its relatively low level of economic freedom today. However, as we move further into the past, the influence of the past on the present wanes. So it may be stretching it to blame India's current poverty on British colonial rule, which ended 60 years ago.

 

As Johan Norberg puts it

As Johan Norberg puts it about Sweden. How do you make a small fortune? Start with a big one.

Apart from that, implying

Apart from that, implying that it's ok that the poor are better off in Sweden than they are in the US because
they're better off in the US than in India just doesn't wash. It's like
saying that it's OK that I beat my kids with a rod because the guy
across the road beats his with a tyrejack.

I guess I wasn't being clear: I was saying that if you only care about the poorest, then some capitalism (Sweden) is better than very lttle capitalism (India). And whatever the current rankings, the relevant issue is capitalism in a historical context, btw; India's grown by leaps and bounds in the last decade and a half but that can't make up for the rest of its history.

Re Rawls, you're right, thanks for the correction. He's on my reading list - perhaps in a couple of weeks when I head back to school.

Also, thanks to whoever added the graphic...

India

 

Nothing strange in thinking that India is poor because it isn't capitalist enough. To an extent its true, to an even greater extent India is poor because in the past it market was even less free. Both points together aren't the ONLY reason India is relatively poor, but together they are the biggest reason.

Well, if you will read the

Well, if you will read the Telegraph...!

India's abandonment of socialism as the DT has it is much like describing Thatcher's ascent to power in the UK as marking the British abandonment of socialism. Which is to say, something somewhat different to, say, Romania's abandonment of socialism. In other words, if everything that isn't unfettered capitalism is socialism, what's the point in the term?

On the Economic Freedom index, it's interesting alright, but I don't think it's entirely helpful in characterising market/non-market economies. More bureaucratic and a bit rubbish states verus less bureaucratic and less rubbish states. At least, that was always my understanding of their methods.

Finally, I started writing because of my irritation at Sam's (passing) remark about Rawls. Arguments about the status of India aside, I assume my response there still stands...

and Reuters

Well, if you will read the Telegraph...!

and Reuters. I find Reason magazine generally credible. They write:

India became the poster child for post–World War II socialism in the Third World. Steel, mining, machine tools, water, telecommunications, insurance, and electrical plants, among other industries, were effectively nationalized in the mid-1950s as the Indian government seized the commanding heights of the economy.

Other industries were subjected to such onerous regulation that innovation came to a near standstill. The Industries Act of 1951 required all businesses to get a license from the government before they could launch, expand, or change their products. One of India’s leading indigenous firms made 119 proposals to the government to start new businesses or expand existing ones, only to find them rejected by the bureaucracy.

The government imposed import tariffs to discourage international trade, and domestic businesses were prevented from opening foreign offices in a doomed attempt to build up domestic industries. Foreign investment was subject to stifling restrictions.

But the planners failed. Manufacturing never took off, and the economy meandered; India lagged behind all its trade-embracing contemporaries. Between 1950 and 1973, Japan’s economy grew 10 times faster than India’s. South Korea’s economy grew five times faster. India’s economy crawled along at 2 percent per year between 1973 and 1987, while China’s growth lept to 8 percent and began matching rates for Hong Kong, Taiwan, and other Asian tigers. Even as that reality became clear as early as the late 1960s and early 1970s, India’s policy makers refused to give up on economic planning. Experts and elected officials settled for what they called the “Hindu Rate of Growth,” which, according to official figures, was sluggish at about 3 to 4 percent per year. That would be respectable for a developed country like the United States or Germany, since they start from a higher economic base. But for a country like India, it’s abysmal.

Attitudes finally began to change in the 1980s, as India’s persistent budget deficits forced austerity measures in the middle of the decade. A foreign exchange crisis in 1991 precipitated major shifts in public policy thinking.

And so on. It seems well settled that India was strongly socialist and has become less so since 1991.

is much like describing Thatcher's ascent to power in the UK as marking the British abandonment of socialism

It seems obvious that Indian socialism was a lot more socialist than British socialism. It also seems obvious that the policy shift that eventually arrived needed to be, and was, much deeper, simply because India has so much farther to go.

if everything that isn't unfettered capitalism is socialism, what's the point in the term?

I've been talking about degrees, not about how to classify India. India has been substantially more socialist than either the US or Sweden from 1995 to today. On the years before 1995 there does not appear to be any information from the Index, at least not from the paper I was using, but recall that around about the time the Soviet Union collapsed, India's economic policies shifted, which means that however socialist India was in 1995, it was very probably substantially more socialist in the eighties (and seventies and sixties and fifties, as is clear from the Reason article).

Your point about where to draw the cutoff between socialism and capitalism does not affect this point at all, since it's not about classifying, it's about degrees. It doesn't matter whether you decide to classify eighties India as "capitalist" or "socialist". It is still substantially less capitalist and more socialist than the US regardless of how you choose to classify it.

More bureaucratic and a bit rubbish states verus less bureaucratic
and less rubbish states. At least, that was always my understanding of
their methods.

They are measuring economic freedom. Are you talking about something other than economic freedom? Remember that this blog entry is about liberty. If you think that the index is not doing a good job, feel free to propose a better measure of economic freedom.

I assume my response there [about Rawls] still stands...

I haven't addressed it, and don't intend to.