There's a new blog in the liberal blogosphere that's made a bit of a splash recently. It's called Bleeding Heart Libertarians and it's from and by a couple of the much speculated upon but rarely seen Left-Libertarian. You know, those are the libertarians that actually mean it when they say that they're socially liberal, as opposed to simply too embarrassed to call themselves republican. That sounds unfair, but what else are we supposed to think when someone says constantly "I agree with you!" and then, just as constantly uses their actions to say "Just kidding!" No, these people actually vote their consciences, but do so from a differing set of premises than most liberals. This does not make them any less wrong when it comes to understanding economics and the domain of appropriateness it encompasses, but it is a nice and refreshing change to see people talking about libertarian ideas without having to put up with the overt racism of the Tea Party. (For those wanting to just skim the article, I've bolded what I think are the important sentences)
A post made by blogger Teson over there came up with the thought that the difference between Left-Libertarians and Liberals is the Liberal's willingness to use expensive signals in order to show support or solidarity. Some good examples of expensive signalling are
- Claiming that Obama is a Muslim - it's demonstrably not true, and it makes you look the fool, but looking the fool to out-group members is vastly less important than showing solidarity with in-group members.
- Ostentatious religious displays - if you can afford frivolities like gilded altars, you must be doing well enough that other people might be interested in joining your in-group.
- In the example given by Teson, supporting minimum wage legislation - apparently it's demonstrably inefficient as a market tool and therefore is classified as a 'costly' signal.
Of course Teson is rather missing the point and he's getting roundly trounced in the comments. Here's my response as posted on his blog:
"I suggest an answer: in the political arena, a person often supports a policy, not because of the effects he thinks that policy will have, but because his supporting it has symbolic value for himself or others."
No.
Ok, let me elucidate:
First: the Modern (non-Classical) Liberal understands that a market is but one tool among many that can and should be used in order to improve the "human condition", however you care to define that nebulous phrase.
Contrast this with the 'rights'-based approach that seems to effectively mandate that markets are the ONLY solution to ANY problem. Why? I dunno, I haven't figured out where the exclusivity comes from.
Markets fail - spectacularly - at many many things. In fact, all unregulated markets will fail spectacularly to improve wealth for everyone at some point: small imbalances in information will inevitably grow into large imbalances in wealth. Disparities in what you know, when you know it, how you came to know it and who you know that can assist you will always immediately unlevel a level playing field with the consequence of concentrated wealth as compounding takes effect.
Markets are good at one thing and one thing only: Finding efficient solutions to not-overly-complex logistical problems. Anything else is asking far too much of such a limited tool. Think about it, markets are essentially a simple evolutionary algorithm set up to find an (not the) equilibrium point where individual actors are the least dissatisfied with the amount of one particular variable in their possession: wealth.
Unfortunately for the rights-based approach, wealth is only vaguely correlated with other variables related to improving the human condition: How do you set up a market for happiness? How do you set up a market for freedom? How do you set up a market for the love of a parent?
The takeaway is this: Markets are an inappropriate tool to use if you want to improve upon anything that doesn't involve moving physical things around, and much of living a good life has nothing to do with physical goods.
That's the intangibles side. The tangible side of the objection is this:
Look around you. Go find some statistics on poverty in the US. The US has relatively unregulated markets compared to other first world nations. It also has higher rates of poverty. Now, look at Europe. Markets in Europe are vastly more regulated than here in the US, yet there is less poverty. Now look at countries that are unable to afford much if any effective regulation at all, even if they wanted to: massive amounts of poverty.
To get me to agree with the premise that unregulated markets fix all, you'd have to find a way to persuade me that when I look in the direction of more regulation and see people who are demonstrably happier, that there's something even better than that in the other direction where all I see is poverty, misery and war. That somewhere past the unregulated paradise of Somalia is a 'true' paradise of human flourishing.
I'm sorry if I don't buy that, but really, I'd have to be as gullible as a conservative christian before I did. When I look dispassionately at the available information, any approach that calls for de- or un-regulated markets sure seems to me to be, at best, begging for trouble - there is a very good reason why the strength of social programs is a very strong indicator of the overall Gini index of a country.
The Post on BHL
Crossposted to Zyx' Mix for those who prefer a quieter discussion.
Edit: I can't spell Criticism apparently.
