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). Continue reading ‘Kevin Rudd, Gordon Brown, Adam Smith and free markets’
The Obama inauguration: some interesting links
There’s probably literally millions of reactions to Barack Obama’s inauguration on the intertubes today, so I wanted to try to highlight some more specific articles and posts which raise some interesting issues which might otherwise get lost in the crowd. [The text is here.]
Two of the more pressing questions since the election in November have been how Obama will respond to the global financial crisis and from what political position he will seek to govern. Both, in a way, have been answered, but hardly definitively. It’s worth observing in passing – and the point is a crucial one for us here in Australia – that the selective invocation of the mantra “there’s only one President at a time” means that we know very little about what the new administration’s stance on global financial regulatory issues and the governance architecture of the world economy will be. Such decisions as are taken – and paths not taken – will probably be of more lasting moment than how effectively and quickly his fiscal stimulus works to turn around America’s domestic economy. But, in that regard, the addition of tax cuts to the infrastructure investment proposed in his domestic package (to corral in some congressional Republican support, or so it’s being framed) reflects a debate about the composition of any stimulus which is important, and to some degree being played out, in our own context as well. Here, I was intrigued to see Andrew Leonard at Salon’s How The World Works blog suggest that a passage in the Inaugural address shows Obama has come down on the Keynesian side of the argument. (And to see Leonard compare Obama’s eloquence with Keynes’, to the former’s detriment.)
Continue reading ‘The Obama inauguration: some interesting links’