As Kevin Rudd joined Gordon Brown in decrying “the false god” of “unfettered free markets” in London’s St Paul’s Cathedral, Janet Albrechtsen got her apoplexy in early, lamenting the fact that Kevin Rudd doesn’t read Hayek (apparently Ayaan Hirsi Ali has offered to tutor the Prime Minister in the guru of “economics and the rule of law”).
Albrechtsen tied herself in a series of knots trying to find the “gotcha” moment in Rudd’s ideological discourse. In point of fact, it’s quite possible to reconcile fiscal conservatism with being a social democrat, but the Hayek worshippers seem stuck in an age when there was supposedly a slippery slope between any view that markets are social institutions and socialism itself.
Here, it’s perhaps interesting that Gordon Brown chose to invoke Adam Smith on several occasions, a thinker to whom the authors of Hayekian dribble pay only occasional and meaningless obeisance:
Now, let me put markets in context. They can create unrivalled widening of choices and chances, harnessing self-interest to produce results transcending self-interest. When they work, they will fulfil the promise of Adam Smith that individual gain leads to collective gain, that even when people are pursuing private interests and private wishes they can nevertheless deliver public good.
But as we are discovering to our considerable cost, the problem is that, without transparent rules to guide them, free markets can reduce all relationships to transactions, all motivations to self-interest; as Jonathan Sacks has said, they can reduce all sense of value to consumer choice, all sense of worth to a price tag. So, unbridled and untrammelled, they can become the enemy of the good society.
And we can now see also that markets cannot self-regulate, but they can self-destruct and, again, if untrammelled and unbridled, they can become not just the enemy of the good society; they can become the enemy of the good economy. Markets are in the public interest but they are not synonymous with it.
Gordon Brown, a former university lecturer with a History PhD from Edinburgh, perhaps has a better claim to public intellectual status than Kevin Rudd. His whole speech is worth a read, and the full text is here (as is Rudd’s).
So why was Brown conjuring up the spirit of Adam Smith (aside from the Scottish angle)?
In 1960, Maurice Merleau-Ponty referred to Marxism as a body of thought that no longer had life, but felt that liberated Marx himself to speak more clearly. That’s a sentiment echoed by many – and Marx as a philosopher enjoyed something of a revival after the demise of Soviet Marxism in 1991. Something similar might be happening to Adam Smith. The body of practices, and the free market ideology underpinning and supporting them, which invoked Smith as a founder, are now in rapid decay. We can now read Smith for what he says, rather than for what ideologues have made him say, and that gives his insights much more contemporary force.
In this context, I’d gesture again to the fact that “free markets” are not identical with capitalism. A recent student of Smith, the Italian-American economist and historical sociologist Giovanni Arrighi, argues:
One of the major problems on the left, but also on the right, is to think that there is only one kind of capitalism that reproduces itself historically; whereas capitalism has transformed itself substantively—particularly on a global basis—in unexpected ways. For several centuries capitalism relied on slavery, and seemed so embedded in slavery from all points of view that it could not survive without it; whereas slavery was abolished, and capitalism not only survived but prospered more than ever, now developing on the basis of colonialism and imperialism. At this point it seemed that colonialism and imperialism were essential to capitalism’s operation—but again, after the Second World War, capitalism managed to discard them, and to survive and prosper. World-historically, capitalism has been continually transforming itself, and this is one of its main characteristics; it would be very short-sighted to try to pin down what capitalism is without looking at these crucial transformations.
Writing in the New York Review of Books, the Nobel prize winning economist Amyarta Sen makes a complementary point:
What are the special characteristics that make a system indubitably capitalist—old or new? If the present capitalist economic system is to be reformed, what would make the end result a new capitalism, rather than something else? It seems to be generally assumed that relying on markets for economic transactions is a necessary condition for an economy to be identified as capitalist. In a similar way, dependence on the profit motive and on individual rewards based on private ownership are seen as archetypal features of capitalism. However, if these are necessary requirements, are the economic systems we currently have, for example, in Europe and America, genuinely capitalist?
All affluent countries in the world—those in Europe, as well as the US, Canada, Japan, Singapore, South Korea, Australia, and others—have, for quite some time now, depended partly on transactions and other payments that occur largely outside markets. These include unemployment benefits, public pensions, other features of social security, and the provision of education, health care, and a variety of other services distributed through nonmarket arrangements. The economic entitlements connected with such services are not based on private ownership and property rights.
Also, the market economy has depended for its own working not only on maximizing profits but also on many other activities, such as maintaining public security and supplying public services—some of which have taken people well beyond an economy driven only by profit. The creditable performance of the so-called capitalist system, when things moved forward, drew on a combination of institutions—publicly funded education, medical care, and mass transportation are just a few of many—that went much beyond relying only on a profit-maximizing market economy and on personal entitlements confined to private ownership.
Sen goes on to discuss Smith:
Indeed, early advocates of the use of markets, including Smith, did not take the pure market mechanism to be a freestanding performer of excellence, nor did they take the profit motive to be all that is needed.
Even though people seek trade because of self-interest (nothing more than self-interest is needed, as Smith famously put it, in explaining why bakers, brewers, butchers, and consumers seek trade), nevertheless an economy can operate effectively only on the basis of trust among different parties.
There’s a clear echo there in Brown and Rudd’s rhetoric.
Sen also observes:
It is also worth mentioning in this context, especially since the “welfare state” emerged long after Smith’s own time, that in his various writings, his overwhelming concern—and worry—about the fate of the poor and the disadvantaged are strikingly prominent. The most immediate failure of the market mechanism lies in the things that the market leaves undone. Smith’s economic analysis went well beyond leaving everything to the invisible hand of the market mechanism. He was not only a defender of the role of the state in providing public services, such as education, and in poverty relief (along with demanding greater freedom for the indigents who received support than the Poor Laws of his day provided), he was also deeply concerned about the inequality and poverty that might survive in an otherwise successful market economy.
It’s probably time – along with Arrighi and Sen – to reread Adam Smith as well as Keynes. And it is time to recognise that Hayek was much more of an ideologue than a serious thinker, providing a range of justifications for a particular form of capitalism – now dubbed neo-liberalism – rather than making any real contribution either to public welfare or to economic policy. Geoffrey Barker:
Keynes was, moreover, hostile to the general equilibrium assumption of the laissez-faire advocates. As early as 1926 he wrote: “It is not a correct deduction from the principles of economics that enlightened self-interest always operates in the public interest.” Perhaps most significantly, he did not he see economic planning as an encroachment on “freedom.” In 1944, two years before his death, Keynes wrote to Friedrich Hayek about his book The Road to Serfdom, which argued against economic planning. While acknowledging that he agreed with most of the book, Keynes took Hayek to task over his attack on planning.
“You agree that a line has to be drawn somewhere, and that the logical extreme is not possible,” he wrote. “But you give us no guidance whatever as to where to draw it… [A]s soon as you admit that the extreme is not possible, and that a line has to be drawn, you are, on your own argument, done for, since you are trying to persuade us that so soon as one moves an inch in the planned direction you are necessarily launched on the slippery path which will lead you in due course over the precipice.”
Keynes’s logic, of course, is impeccable; his judgement is mature and balanced. The question is not whether or not Keynes is “back” but whether today’s politicians can put together packages for economic and financial recovery with similar logic and balance.
You are aware that “The Wealth of Nations” is five books, so there is a lot of reading to set yourself here.
Isn’t all this a bit ironic given that Brown was one of the architects or and champions for light touch financial regulation? Indeed, he made a career out of lecturing the Europeans on why their regulatory systems were inferior and is still standing in the way of an effective European financial supervisory regime because he doesn’t want UK banks to be subject to external oversight. Brown’s credibility on these issues is non-existant and his apparent Pauline conversion is less than convincing. I can only interpret it as another desperate attempt to retiain some electoral credibility….Brown’s fiscal credibility is also shot. Not only did he undermine his own golden rule in the lead up to the crisis, but the UK is likely to run deficits of over 10% of GDP over the next few years and public debt will almost double to around 80% of GDP. At the same time as he is trying to convince the Europeans of the need for new stimulus packages the Governor of the BoE made it very clear that he thinks such stimulus is unlikely to be affordable.
I’d pay a bit more attention to what Gordon does than what Gordon says….
@1 – yes, Terry, I know! But then I did wade through Capital and the Grundrisse!
Oh, and all of Gibbon’s Decline and Fall.
It is funny that both Keynes and George frickin Orwell were quite positive in their criticisms of Road To…, while in return the free market purists go as far as to say every aspect of Keynesianism should be buried.
I currently haven’t the time to pick up The Wealth of Nations or JMK’s General Theory, but recently I was reading Nugget Coombs memoirs, and I could swear I heard some of the old man’s philosophy in what the two Reserve Bank officials Ric Battelino and Guy Debelle said yesterday.
It’s important to understand what Brown and Rudd are actually talking about. Their St Paul’s performance was the equivalent of the band playing “Nearer My God to Thee” on the listing deck of the Titanic. It was a remarkable gesture of public piety but it was never intended to prevent the ship from sinking.
Rudd and Brown know that the Washington consensus has struck an iceberg and is going down. Moreover, much of the institutional superstructure of the financial systems of both Britain and Australia will either be swept away or will undergo major revision.
Thus, the Rudd/Brown St Paul’s double act was a gesture to the future and a plea to posterity to order the economic, social and moral affairs of their countries in more sustainable ways.
And the measure of that sustainability will be whether or not their whiggish, non-conformist, limited government traditions can withstand the challenge of China.
But all that is in the future. The task now is to persuade China to save what is salvageable of the global system without also demanding conditions that will destroy the traditions that Rudd and Brown have so recently purported to embrace as core to their moral vision of the future.
But Rudd and Brown are frightened hypocrites. Rudd and Brown are like schoolboys at some ghastly Edwardian academy waiting outside Headmaster China’s study for a jolly good thrashing. They’ve been caught thieving from the tuckshop. And now they are hoping against hope that their expressions of piety will spare them a few cuts of the cane.
But it won’t. Whacko.
We’re watching the farcical death throes of the whiggish world.
@2 – I’m interested in what he has to say in its own right, LO, because I think he makes some compelling points which have force independent of his own past actions or present intentions or dispositions.
I also wouldn’t rule out Brown’s practice in Treasury as having been his own contribution to what the “New Labour” mindset suggested should be done. There’s evidence to suggest his priorities were different from Blair’s and I think the degree to which Brown was a free agent is usually overstated.
Additionally, I don’t know why it would be a fault rather than a virtue for a politician to have learned from experience.
Yes, Brown’s priorities weren’t identical, but Blair had nothing to do with designing the financial regulatory/supervisory system. And his response to the crisis so far, at a time when he is unambiguously in charge has been poor. The government have lurched from one poorly thought through measure to another and as I said he is still standing in the way of more effective European regulation. So if he has really learned something from the financial crisis, it isn’t really clear yet that it has translated into more effective policy. Rhetoric is cheap.
Brown’s performance as a crisis manager isn’t really the focus of my interest in writing about all this, LO, but I do wonder if there are any governments of nations at the heart of the crisis which didn’t lurch from “one poorly thought out measure to another”. I’d argue that the latest Geithner plan is one, for instance. Barker’s thoughts at the end of the post might be worth signalling here.
What I do think is a hopeful sign is some recognition that more is at stake here than a technical fix.
“It is not a correct deduction from the principles of economics that enlightened self-interest always operates in the public interest.”
That has been the view of mainstream economists and policy officials for decades now. Gordie would have said the same thing a decade ago. The basic principle has underpinned Australian public policy for a long time. Unfortunately, as always, the really difficult questions involve determining under which circumstances enlightened self interest does and does not operate in the public interest and how precisely markets should be regulated to best serve the public interest. Clearly that will also vary across sectors of the economy. It is here where the real public policy debates will occur both in Australia and overseas, not abstract debates about the relevence of Hayek. I mean come on, I’d be shocked if more than 5% of senior public servants, politicians, influential academics or journalists in Australia genuninely subscribed to Hayek’s political philosophy.
Well, precisely, and that’s sort of Keynes’ point. But the reason why the word “Hayek” is tossed around is that it’s code for a preferred model of regulation. Sen additionally makes the point that “capitalism” as it’s imagined in the free marketeers’ world does not (and cannot, he might add) exist. What we have operating under the guise of an ideological dispute or an argument about “freedom” is in fact a self-interested preference for a set of policies which advantage some at the expense of others. It’s important that this be understood – the apostles of the free market are peddling ideology, and nothing else.
I might add, though, that what the public interest constitutes is also a matter (properly) of some contention.
It is a bit more complicated than that Mark. Some form of ideology is at the heart of almost all of our views on the right way to organise society and our public institutions.
I don’t disagree in the slightest, LO. What I object to is ideology masquerading as truth. Jabbering on about “economics and the rule of law” implies a set of value preferences which are naturalised through their occlusion. I’d much prefer people to be upfront about their ideology, and “where they want to draw the line”. A whole heap of nonsense about “freedom” shouldn’t be permitted to obscure the fact that the Hayek mob are actually arguing for social arrangements which deeply advantage those who are already advantaged.
And it does this through the mechanism of progressive taxation. It is progressive taxation that delivers the social outcomes, not private profit. One of the major thrusts of Reaganomics has been the flattening of taxes, or the reduction of the tax rates for the wealthier classes. In the US they are about 25% I think. That’s pretty low. In the 1950s they were around 90% if I’m not mistaken. The US Congress recently discovered that they could recover 95% of the bonuses they stupidly gave out to the bankers through special taxation, but this was a one-off. Time for socialists to rise up and demand very high tax rates on the uber-wealthy.
When people describe Kevin Rudd as a “social democrat,” what could they possibly mean?
And, of course, that’s a statement unstained with ideology, Mark.
I note, with great – though unsurprised – interest that you chose not to quote this part of Brown’s speech:
I suppose “open markets, free trade, private capital and a flexible, inclusive and sustainable globalisation.” are ALSO reconcileable with “social democracy”.
Not that anyone should get too worked up over anything Gordon Brown says publically. As LO noted, he has an election to win, and it’s going to be pretty hard to blame the other guys (like our own hypercrite Rudd) when he was Chancellor for the decade leading up to this recession.
Brown and Rudd are serving up hypocritical, populist pap. Your attempt to dress it up as something intellectually meaningful speaks volumes about your own ideological peddling.
“A whole heap of nonsense about “freedom” shouldn’t be permitted to obscure the fact that the Hayek mob are actually arguing for social arrangements which deeply advantage those who are already advantaged.”
.
“What we have operating under the guise of an ideological dispute or an argument about “freedom” is in fact a self-interested preference for a set of policies which advantage some at the expense of others. It’s important that this be understood – the apostles of the free market are peddling ideology, and nothing else.”
.
When I read these two passages I was made to wonder if you are convinced that the Hayek mob always operate with ulterior motives? So the supporters of free markets are actually just using this as cover for selfish wealth accummulation?
In the current crisis the accummulation of $62 trillion of now worthless credit default swap obligations has crippled the banking system.
The loss of confidence in the solvency of banks has stunted trade as few entities have faith that their counterparties (or their banks ) are financially solvent.
On cue we now have a collapse of capital investment and general economic contraction, rising unemployment and the need for the governments around the world to soften this decline in economic activity by targeted spending.
.
If this simplified explanation is acceptable at what point is new governement intervenation going to be useful? As you have asked people to be upfront about their ideological biases my preference is for a regulated free market. Must this be a contradiction? A system which allows self interested activity doesn’t have to be malicious to others by default rather if there is inadequate or antiquated regulation then the negative aspects are allowed to emerge.
The regulations supervised by APRA appear to have been adequate for Australian institutions ( minus the Allcos, Storms and their like ) to continue to perform their functions. Extend this to cover Ratings agencies ( they may already be included and if so they need to be strenghtened ) and one of the well springs for the latest imbroglio is removed.
One part of this current crisis which hasn’t attracted the sort of attention I think warranted is the corruption which had been overlooked or even passively accepted. Where regulations have been broken there doesn’t appear to be any agency pursuing the perpetrators . Why not? Not the done thing ? It is here that enhanced regulation will be positive for the future functioning of the markets which emerge in time.
And apart from that – what Katz said! How people still have confidence in the same people who presided over the recent economic collapse being in charge now is stunning.I know Mark Latham isn’t flavour of the month on this site but as he commented recently Mr Rudd was a keen enthusiast for light regulation and freeing up government oversight when he pitched himself as Shadow Treasurer.
It is a pity that we aren’t all more sceptical towards these neoliberals now cloaking themselves in the dull blue garb of Mao suits and sympathy for the hard done by .
Mark says:
Gordon Brown’s father was a Presbyterian minister and “a strong influence on Gordon”. Brown’s old-fashioned moralism stems from the Scottish Enlightenment’s fusion of religious faith and civil freedom. So it is no surprise that he invokes the name of his compatriot Adam Smith who was primarily a moralist, not an economist.
I agree with Mark that Smith’s work deserves revival. But it is wrong to dismiss Hayek in the same breath. Hayek, like Smith and Durkheim, understood that the enforcement of individual rights in a modernist secular society depended upon the acceptance of duties derived from pre-modernist religious communities.
Smith’s whole work was dedicated to resolving the tension bw economics and ethics. He argued that whilst the economy was motivated by self-regarding actions (“wealth of nations”) the society had to be motivated by other-regarding actions. (“theory of moral sentiments”). Crudely speaking, the professional relations of firms run by egoistic greed, whereas personal relations of families/friends run by altruistic love.
This looks like a contradictory theory of human nature but Smith resolved the contradiction by pointing out that it was in the self-interest of each to act in the interest of other like-minded fellows whom we owe some sympathy. Wikipedia:
Durkheim came to a similar conclusion, religion – by instilling communal mindedness – helped self-regarding individuals mirror others in their own consciousness:
Hayek is much harder to pin down since he sometimes seems to be a hard-line economic liberal (when churning out for think tanks) and at other times seems to be supportive of traditional moral verities (when composing door-stop sized treatises). He betrayed his personal sympathies in his last book:
THis is important in political economy because professional contract relations have be embedded in a broader culture where the values of fair play and honesty are respected. These values are frequently not in the egoistic interest of market players. Yet markets cannot run properly without them.
That is why most modernist liberal theorists, such as Smith, understood and promoted traditional Christian moral values. WHy businessmen sent their kids to Christian schools (eg Scotch) and liberal parties tended to ally with religious or nationalist parties eg L/NP.
But that started to change in the past generation. Post-modern liberals ie libertarians worship self-gratification and self-service over self-denial and self-sacrifice. And Smiths object of study – modern industrial capitalism – degenerated into post-modern financial capitalism. Which further abstracted professional exchange from personal relations.
Since it is no longer possible to rely on a spontaneous religious ethic in order to get people to do the right thing we now have to resort to litigation in order to properly assign individual rights and institutional duties.
This is whats known as moving from the sacred to the profane.
The only social democrats in this game are the allegedly “right wing” French and German leaders who’ve just called for far tougher regulations on hedge funds etc.
Meanwhile, perfidious centre-left Albion sits around just hoiking money at the same old dysfunctional system, socialising toxic debts, not demanding any new rules, and boring all and sundry with empty rubbish about ‘false gods of unfettered free markets’.
Fetter them with massive cash handouts!
#9 – Hey, is that you Micheal?
# 16 Jack Strocchi Apr 2nd, 2009 at 8:48 am
I forgot to add that post-Cold War CIS provides a perfect case study in what happens when you try to impose a capitalist market economy on top of an de-religioned secular society. Something comparable happened when in the post-Whitlam era when inidigenes got to sample the delights of post-modern cultural liberalism.
In both CIS Russia and remote indigenous communities the secularists (commies, capitalists or new liberals) derided and destroyed religious-based moral institutions. The churches were nationalised or vandalised in Russia. Missionaries were moved off the Aboriginal reservations in Australia.
This created de-moralised society creating anomie amongst the young. This catastrophic social dysfunction was predictable based on Smith-Durkheim theory: higher suicide rates, alcoholism, drug-addiction, child-abuse, broken families, plagues of STDs, criminal gangsterism.
Thats what happens when post-modern liberalism (ie amoral differentiation) is unleashed on a society not founded on pre-modern “corporalism” (ie moral integration).
I think the public, quite rightly, wants a lynching and no politician without a death wish will say anything other than what Brown and Rudd are intoning.
But I agree with others here that our ‘social democrat’ leaders’ sudden re-embrace of their long discarded ideological wardrobe looks a little undignified.
I think we also need to be wary of extending a quite justifiable need to crack down on excessive leverage, opacity and irresponsible risk-taking in the shadow banking system into a free-for-all on open markets, free trade and globalisation.
So we need a few sacrificial lambs (the ratings agencies would be a good start), we need to turn banks back into the utilities they used to be and we need to strengthen the retirement savings system so individuals are not bearing all the risk.
Debates about Hayek are irrelevant.
If only it were that simple, Mr Denmore. There is no gradualist path back to the benign normality that you outline. The world, especially that part of the world that relies on the leverage made possible by the Washington consensus, will necessarily endure many rude shocks in the near future. Needless to say that Britain and Australia are trapped in the coils of that consensus. The G20 aren’t about to give such countries a leave-pass from the approaching season of suffering.
See here.
This refers to exposure only of US banks. These banks are the five biggest. The derivatives mentioned are largely credit default swaps of the kind issued by AIG. As every schoolboy knows, AIG is insolvent and is being bailed out by the US government. Taxpayer funds raised to cover AIG are being paid to AIG’s creditors (overwhelmingly the biggest five US commercial banks and some large European banks). Yet the US government is slinging only multi hundreds of billions at AIG — chicken feed. When that money runs out, then the rest of these derivatives (about $199 trillion worth) become toxic.
There is absolutely no prospect of the US government (or anyone else) being able to raise funds sufficient to cover that shortfall. AIG’s (and others’) commitments to these banks cannot be covered. Therefore, these banks will be bankrupt.
It’s little wonder that Brown and Rudd are prepared to be seen as deathbed converts to the power of prayer.
Mmm, but Katz, who are the counter-parties to this $200 trillion with a T derivatives exposure?
If they are mainly other US banks, then they just start writing off losses against each other on paper. A complicated accounting exercise, no doubt, but not one that poses a fundamental threat to the banking system itself.
If the counter-parties are not US financial institutions, things get more interesting.
LolKatz doesn’t understand netting, Paulus. Unfortunately, he hasn’t done his homework, yet again.
Wrong. Do your reading and try again.
http://www.creditwritedowns.com/2008/10/lehman-brothers-primer-on-credit.html
.
A blog site with an explanation of the CDS market. The contracts are usually illiquid , not easy to trade and as they are made between 2 private parties the contracts aren’t subject to external scrutiny.
Charming as ever.
I’m upfront about my ideological stance. And I do welcome a perspective which correctly makes markets into a mechanism or a tool subservient to social needs rather than an end in themselves.
This deal stinks. As I read it, the proposal is that the US taxpayer effectively insures toxic debt, which will be sold to private industry with 90% of the risk underwritten by Joe “Born to Lose” Public.
What does the public get out of this deal again? Talk about rewarding failure. We let these bozos have virtually free rein, they loan en masse to hi-risk borrowers, and then they fell over. Now these free marketeers want us to save their sorry asses. Well, sorry – next! If the state has to march in, where’s our cut? Do we get the profits for services? Why dont we get to own the shit we just bought?
Above all, why are we propping up a failed model? When did Yeltsin start running the show here? What IS wrong with people saving money, instead of riding this credit bicycle economy till it falls over sideways, dead?
Interesting post Mark. I’ll get back to it tomorrow but this:
Is shakey. At the very least in one instance because neo-liberalism didn’t exist when Hayek was writing. He wrote The Road to Serfdom when liberal economics was thought preposterous. To seriously advocate and well what is direly unfashionable is one mark of a truly serious thinker. In another instance because you yourself thought a bit more of Hayek than you seem to now.
.
There’s a certain ideological hardening on those who advocated Neoliberalism. I’ve issued some acerbic commentary on Catallaxy about this and it’s fallen on the deaf ears of the wounded. However it seems to me that just because laissez-faire might be the manna of false prophets doesn’t make the Neo-Socialists correct.
.
And it doesn’t render false the central thesis of the aforementioned book.
No, no, I’m sure he understands perfectly well that the netting is what one uses to do the fishing.
Adrien – to clarify – his ideas were among the building blocks of neo-liberalism. He was there at the genesis, so to speak. I’m not saying he is a worthless thinker. Some of what he has to say about spontaneous order has value – though I’d argue not in the way he thinks (or his epigones have adopted). And, as noted in the Barker article, there was some common ground between him and Keynes.
My point really is that he’s not as significant a thinker as Keynes or Smith (or Marx) – more of a reactionary in a couple of senses of the word. And the weird cult like aspects of his legacy on one hand, and the invocation of his name as an ideological code word on the other, are worthy of analysis imho.
In fairness, Hayek is relatively good compared to everything else they’ve got. Has anybody tried to read Rand?
RAND Corporation, or Ayn’t She Grand?
Hey, weren’t Bush and Blair mocked constantly by the left for their public religiosity? Can you get any more publicly pious than giving sermons at St Paul’s cathedral in which you appropriate theology to sell an ideological agenda? Rudd and Brown make Sarah Palin look like an aloof agnostic.
Hayek is certainly a better writer – he has quite a nice style!
Rudd the Christian Keynesian who deplores the greedy dehumanisation of the little people.
Kevin Rudd loses temper over in-flight meal.
What Adam Smith or Fred Hayek would said when confronted by the current schemozzle.
“Conservatism in power means larger, not smaller government, not only because the extreme inequality it favors must be defended by coercive force but because the economy requires huge amounts of government spending to stay afloat in the face the perpetual demand deficit created by that same inequality. What you end up with is less like a virtuous Republic and more like an Eastern Roman Empire, a militarized state dominated by functionaries, not entrepreneurs.”
I wish I could source that quote. Anyway in the meantime “Cathay delenda est!”.
“Has anybody tried to read Rand?”
Yes. And don’t bother. A seriously crap prose stylist who makes Heinlein read like Bellow.
And appalling simplistic polemics mounted like gimcrack desert castles that even Flank Lord Right wouldn’t stoop to bury.
“There are two novels that can change a bookish fourteen-year old’s life: The Lord of the Rings and Atlas Shrugged. One is a childish fantasy that often engenders a lifelong obsession with its unbelievable heroes, leading to an emotionally stunted, socially crippled adulthood, unable to deal with the real world. The other, of course, involves orcs.”
And when I was fourteen, the two books that really left an impression, if not an actual scar, were “The Once And Future King” and “Justine (Or The Misfortunes of Virtue)”.
Jeez, talk about Rudd Derangement Syndrome. Some people really do need a bex and a nice lie down.
Swapping teenage books? “1984″ scared me witless. Orwell was a better influence than Rand, I think. The religiosity of PMs Brown and Rudd, foraying into preaching in a (!!!) church, doesn’t worry me.
So much of political rhetoric has a large moral flavour (and in UK & Australia that still has enormous resonance with Christian traditions and the social teachings of Popes and Archbishops). Some political discourse has “religious” tonesss ["millenarian socialism" anyone?] Let’s recognise that residuum. Let’s use it for good. Let’s compare it with other religious traditions.
OK, there’s a logical flaw: ‘post hoc propter hoc’. Just because the religious way of thinking came before the political philosophies doesn’t prove the politics borrowed or adopted or adapted the religion. Suppose there’s a deeper fund of feelings and ideas…. BOTH religions and (some) politics draws on that same fund. Ergo, they may sound similar. Doesn’t mean the politics borrowed the religion.
The most heated atheist may express his ideas of human betterment in language and thoughts appearing very close to Christian terminology. (Hence the heat?)
Heh. You’d know, Mark:
Pot, kettle, und so weite.
But not “peddling” it?
Sheesh. “End in themselves”? I’d welcome a perspective which doesn’t involve giant strawmen.
“und so weite”
Stick to the Frawg, dawg.
You don’t peddle ideology, I’d have thought. It’s assumed. Speaking of which, Jack, in your comparison of post-1991 Russia to remote Aboriginal communities:
You tell me who the alcoholic drug addicted criminal gangster was in Russia after 1991. I’ll give you a hint: he wasn’t very young.
Was he someone I blogged about on the occasion of his death two years ago?
Yes, there is that. Another (I’m sure unintentionally) funny thing about Strocchinino’s spray earlier on is that he thought the noteworthy feature of the USSR was its secularism. Forget 70+ years of hard-core bolshie command-economy socialism – that shit’s obviously irrelevant. No, where the commies really went wrong was in their nastiness to the Orthodox beardos.
Man, the Strocchiverse is a weird place – like the Hotel California, but with only one station on the cable TV. Fox News, most probably. Or Disney.
Good thread, that, Norto. Klassic Katz Quibbling.
Mind you that’s just me—once a commentist, always a commentist.
“Man, the Strocchiverse is a weird place”
Hardly surprising. When the rhythm is the bass, and the bass is the treble, shit’s bound to get weird.
So it’s not permitted to discuss what role markets should play?
Liam @ 47, you forgot the link
Is that what you were doing? It looked to me like you were slagging off a strawman*.
* That sounds kinkier than I meant.
P.S. Tovarishch Stoushenko, your link was incorrect. Try this one.
A fetish built on straw?
Or a friend of Dorothy?
Sorry Brian. It’s this one.
Ah! Beaten to the punch.
An invisible hand behind the curtain, clearly. Pay no attention to the invisible hand behind the curtain!
Are you cleaning up these rap lyrics on purpose Hoges?
Biggie and Tupac are turning in their graves.
Standing at the bus stop sucking on the agitprop,
Once he gets pumping its hard to make the Hogie stop.
Nahhh, baby, I like it raw, ooh baby I like it raw.
Now:
This is word, Mark. And it’s the answer to DJ Bazarov’s question about the reconcilability of free-markets-and-globalisation with social democracy; you reconcile them by freeing the market from crude instruments, like tarriffs, then regulating the living hell out of it, with subtle instruments, like financial services legislation backed up by the threat of jail fines. Rudd and Brown would be more correctly termed Sarbanes Oxley Socialists.
Or something.
Jail terms and fines, that is.
“you reconcile them by freeing the market from crude instruments, like tarriffs, then regulating the living hell out of it, with subtle instruments, like financial services legislation backed up by the threat of jail fines.”
Word.
As it turns out the word was ‘and’.
According to the wife of thr Russian President, Marx is a best seller in Russia again. Well, its sort of G20.
And Paul,
Now that the Russian folks are fairly clear on the parts of Leninism, Stalinism, Brezhnev asleep on the job, and Yeltsin, that they abhor… what do you think Marx has to offer them?
Will it be like thousands of Westerners buying “A Brief History of Time” by Stephen Hawking a few years ago, but not getting much out of the book?
Well, it’s a word. “Tosh”, to be precise. And largely because of the deliberately ambiguous and shyly obfuscating terminology: “social democracy” and “social institutions”. Well, of course democracy is social; the anti-social kind doesn’t exist. Likewise markets are always “social” in the sense that they involve multiple participants. Of course, we are expected to understand the subtext: “social democracy” means half-arsed socialism. Then we get this strawman malarkey that followers of Hayek ignore social context. Of course they don’t.
Of course! It’s so simple! We should regulate financial services and impose fines and gaol terms! Except we already do, of course. Banks are amongst the heavily regulated companies in the Western world and neither that regulation nor SOX prevented the GFC. Think again.
The only people stuck in ages past are those recalcitrants out there who still think socialism works and that the system we have now is based upon “unfettered free markets”. Ridiculous tosh.
He must be offering them something, comrades, ’cause they’re reading him. And its not exactly accurate to confuse the 300 year old Russian tradition of absolutism/police state/etc etc with Marxism. Now, if Friedman was a best seller, I’d really be worried.
I understand that you’d want to disavow brutal repression and murder, Paul.
But when Lenin and the Bolsheviks triumphed, I don’t recall that their rallying cry was:
“the 300 year old Russian tradition of absolutism/police state/etc etc” will continue, comrades!!
I think it was more like: “land! bread! socialism!!” inspired by Marx. It’s a cliche to say Marx predicted proletarian revolution in industrialised nations (Germany, France, England) but history served up agrarian, feudal examples in Russia, China, Cuba etc.
But my questioon remains: even allowing that Marx’s ideas were distorted in Russia, …. after all those decades of history, experience and bloodshed, what do you expect today’s Russians will conclude after they’ve read Marx?
[Distortion of a shining ideal is not of course exclusive to absolutist political rulers, let alone those leading in the name of Marx - look at the bloodcurdling acts of "Christian" autocrats centuries ago. Hard to recognise baby Jesus there.]
I believe 2Pac’s treatise on the all-consuming pursuit of brassicas, and the tendency to lose one’s humanity in same, could be of relevance here:
“Niggas be actin’ like they savage,
they out to get the cabbage”
A sad tale of self-interest gone mad, and the attendant breakdown in social institutions. But wait…
“I got nothin’ but love
for my niggas livin’ lavish.”
Maybe it’s not as simple as we thought, and Pac seems happy to let the ambiguity stand. So we must turn instead to the fable of Cabbage Jack, his overbearing boss Lavender MacDade, and their attempts to enslave the innocent children of the cabbage patch. Jack:
“Cabbages, cabbages, yum yum yum
Cabbages, cabbages, gimmee some.
Cabbages for breakfast, cabbages for lunch
Cabbages all the time, munch munch munch”
Won’t someone think of the children, Fyodor? Will there ever be “laughter in the cabbage patch again”?
Ambigulous, or “we will impose democracy on Iraq if we have to kill every last Iraqi to do so”. Political philosophy will only get you so far, or in military terms “no plan survives contact with the enemy” (paired, of course, with “we have met the enemy and he is us”).
The current combination of international capitalism with national regulation seems to me to be the problem. We just don’t have an effective way to deal with multinational entities on any level, whether that be the World Bank paying billions to dictators or Union Carbide killing thousands in India. When the system works it can be great for everyone, but capitalism absolutely requires effective regulation to prevent disaster. Like, say, AGW.
Fortunately it’s starting to look as though we might get a little bit.
True, very true. All I’m asking for is a bailout.
Won’t someone think of the socialists? No? Oh well. For those recalcitrants out there who still think socialism works – fortitude, it will come around again, until then – till the day we meet again
till the day we meet again I said
Right Liam. And if the first handout doesn’t work…
More!
Well, I laughed.
Thanx Casey!
i luv that song i always cry cos i think about my cat who died u kno?
so sad but i feel heapz beta afta LOL
Yes moz, life is complicated and politics even more so. Philosophy stubs its toe against daily life and winces. Scurries back to the library, or learns from the pain, revises theory. Cheers.
Oh wow FDB. But I win the terrible songs for dead cats contest hands down. My partner used to get so upset, cause when we broke up that time, it was my dead cat I thought of when I heard this and not him. Like, hello????
Like, hello???? indeed.
Hey – what rhymes with excrescence?
“Oh, that’s easy Professor FDB!”
Oh yes, I declare Casey the “winner”. But here’s my late entry.
Thats your dead cat song Liam? “Feeling together – believing whatever?”….just what the hell did your cat die of exactly?
No I dont want to know. You can win with that. You are the I cry for my dead cat with an embarrassing song winner. You are weird though.
Good Lord that’s awful Liam.
A shame the big fella carked it before he had a chance at a Missy duet.
Yeah, Haiku. What up, homeslice?
My dead cat song is this.
What? He was a grey, wolf-sized killing machine who was always hungry.
Oh thats just Nabakov having a night in.
I visualise Nabakov having a night in, being more like this (coincidentally also featuring Bruce Campbell).
Mark – My point really is that he’s not as significant a thinker as Keynes or Smith (or Marx) – more of a reactionary in a couple of senses of the word.
. You gotta be careful old bean. People remember what you’ve written and some of ‘em will pull it out.
.
Oh, so you were being hyper-bolus?
.
Alrighty. I’m not sure how you rank significance. It’s a little like art, yes? Hayek was probably the originator of ‘neo-liberalism’ but like Marx it’s important to distinguish what he wrote from what people actually did with it, don’t you think?
.
Hayek wrote The Road To Serfdom at a time when centrally commanded economies were thought inevitable. Even the Tories were resigned to ‘em. And, as Orwell acknowledged, to centralize economic activity is to create a monolith which will attract the power hungry like ants to a sandwich. It troubled Orwell a great deal because he thought the thesis was correct and pondered how to design a ‘socialism’ that either was not based on the command model or somehow managed to preserve social liberties anyway.
.
People naturally would argue that the Social Democratic corporatism does such a thing. However I’m not convinced that Hayek’s thesis is entirely irrelevant. The corporatism I see developing across ideological lines and throughout the developed world worries me because there’s a technocratic apparatus that is capable of frightening modes of control and in light of personal liberties and a democratic ethos which is erroding because taken for granted by a self-indulgent population I think we could see something very much like a return to totalitarianism some time. Just one with markets managed and controlled by multinational institutions.
.
This is Foucault’s concern: the conflict between technocratic apparatus and individual sovereignty.
.
I don’t think the rhetoric about ‘small government’ or ‘freedom’ is taken seriously by a lot of people who advocated neo-liberalism dogmatically. The freedom they were interested in was freedom to do as they pleased economically and by ‘they’ we are talking of various corporate elites. You may be able to transfer your factory from Iowa to Mexico because of the NAFTA but a hot dog stand owner in Tihuana can’t set up another in Houston with the same ease. And naturally many advocates of neo-liberalism screamed blue murder when Congress denied them their welfare cheque – funny that.
.
In my opinion these things; this dispartity between what was said and what was done is something sincere advocates of classic liberalism should confront now that they are suddenly unfashionable. But I also believe that the conflict viz economic regulation and such between liberals and socialists in democracies feeds a much darker beast that persists in being ignored.
And the weird cult like aspects of his legacy on one hand, and the invocation of his name as an ideological code word on the other, are worthy of analysis imho.
.
Weird cults grow up around all sorts of intellectuals, Marx is the World Heavyweight Champion of weird cult as intellectual progeny. But you can’t really blame him for it can you?
.
In fairness, Hayek is relatively good compared to everything else they’ve got. Has anybody tried to read Rand?
.
I’ve never read her. I don’t think many people at Catallaxy take her seriously either.
.
Anyone who craps on about freedom and proceeds to dictate peoples’ tastes and choice of sexual partners to them is, um, a lot of things none of which are pleasant.
.
I’ve been trying to get a copy of Rothbard’s The Sociology of Libertarianism which went into the Randoid weirdness. Anyone read it?
Jeez, what a party pooper.
Get over it Adrien. I don’t think anyone gives a flying f*ck what the misfits who inhabit Catallaxy think about anything.
Although to use the word think to describe most of what they spew out is perhaps over generous.
Get over it Adrien. I don’t think anyone gives a flying f*ck what the misfits who inhabit Catallaxy think about anything.
.
Get over what?
.
At Catallaxy they’ve quoted Mark singin’ Hayek’s praises. Whether you care what the ‘misfits’ think or not doesn’t alter the veracity of that information.
.
But that aspect of my comment was an aside. Just because neo-liberalism is dead we can all come out of the closet and admit we were socialists all along. Well the relegation of Hayek to the dustbin because of the policy mistakes of his ‘followers’ offends me for the same reason as someone who refuses to read Marx because of what Joe Steel and Mousy Tongue did.
.
It’s not about ideology but about ideas.
.
Hayek had the courage to promote his views when it was highly unfashionable to do so. It will be interesting to see some people who formerly avoided openly advocating socialism now doing it because suddenly it’s not a dirty word anymore. And amusing if they subject Hayek to nefarious connotations like Mr Rudd seems to like doing.
.
BTW Belabelling persons with whom one disagrees ‘misfits’ makes one think of the likes of Andrew Bolt. In fine company you are.
Adrien, don’t make the mistake of thinking that the fact that I disagree with them causes me to use the word misfit.
Sorry, I have to laugh when I seem Rudd and Brown mentioned together. They star in these South Park type videos:
))
http://www.youtube.com/watch?v=ZjQzXOwl0ws
Oops, sorry, I posted the same one twice. The second one is here, starring Obama too:
Ambigulous @ 66,
Well, I wouldn’t suggest current day Russians who haven’t got rich off privitisation of state assets would think their present day society is a shining example of successful “compassionate conservatism.” So maybe that’s why they’re reading Marx.
I won’t dignify the comment about disavowing brutal repression etc with a reply.
Sorry I took so long to reply. I forgot I posted on this thread.
Adrien, don’t make the mistake of thinking that the fact that I disagree with them causes me to use the word misfit.
.
Okay Adrian. Why did you? It was an easy ‘mistake’ to make.
Thanks Paul,
I had asked “what do you expect today’s Russians will conclude after they’ve read Marx?”
I can see that many Russians today are likely to be unhappy with their system and nation. Fine. But what do you think Marx’s writings can offer them in the here and now, given that their grandparents lived in a system nominally Marx-inspired, under which many lives were brutish, nasty and short?
I’m genuinely curious. For example, why might Russians not gain valuable ideas by reading other giants of politics and history? Giants whose writings were unavailable in the old Soviet days, except perhaps in samizdat form.
[a small non-Russian example: a friend who grew up in old Czechoslovakia had never heard of Karel Capek. Not a giant, I grant, but what a shrivelled mental life for those Czechs and Slovaks..... under State controls!]