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Friday, October 3, 2014

The Week's Terrible, Horrible, No Good, Very Bad Blogger

I used to be a print subscriber to The Week; I liked it as a readable, interesting digest of a variety of news sources (including international). Like most mainstream news magazines, it is slanted to a left/center perspective, which dismays but does not surprise me; I often read material challenging my point of view.

I have sometimes taken exception enough to various podcasts (say, a Bill O'Reilly talking point) or op-ed (more recently, Time columnists) to publish a one-off rant. This is one of those cases where the heading itself is so over the top, it basically serves as a lightning rod for libertarian blowback: "Libertarianism's terrible, horrible, no good, very bad idea It's called "spontaneous order." And it's eminently stupid. By Damon Linker". I'm actually in the fusion libertarian-conservative camp, and my purpose in this post is not to eviscerate Linker point-by-point as might an anarcho-capitalist in the Austrian School economic tradition (see here for one such sample critique).  I simply want to make a couple of points: (1) before writing an article like this, an author should be very careful in describing the salient construct (spontaneous order), not creating a straw man that reflects badly on one's competence and credibility; (2) I want to use this as a teaching moment. There are more detailed and rigorous explanations  (I'll provide a sample starting point for the interested reader); I want to provide a more readable, practical introduction to the concept, hopefully without oversimplifying the concept.

It's not unusual that Linker joins a crowd, e.g., of former libertarians bashing the ideology in Salon (here, here, here, and here). The basic theme is that libertarians are dangerous, almost cultlike with naive, oversimplified notions, that we would live in a lawless world of survival of the fittest/wealthiest, where businesses would pollute with reckless abandon, infrastructure would never be built or maintained, etc. In fact, classical liberals like Adam Smith and Herbert Spencer had developed   sophisticated moral philosophies; I talk about the Hofstadter caricature of Spencer's alleged social darwinism here (see also this related discussion). [A typical smear of Spencer is this PBS excerpt: "It was Spencer who coined the term "survival of the fittest," using it to apply to the fate of rich and poor in a laissez faire capitalist society.". In fact, Spencer's relevant work and concept of evolution was distinct from and preceded Darwin's natural selection work; a more correct description (W): "Whereas in biology the competition of various organisms can result in the death of a species or organism, the kind of competition Spencer advocated is closer to the one used by economists, where competing individuals or firms improve the well being of the rest of society."]

"Spontaneous order" is "an order which emerges as result of the voluntary activities of individuals and not one which is created by a government" or "most of those things of general benefit in a social system are the product of spontaneous forces that are beyond the direct control of man." Contrast that with Linker's description: "Simply stated, the idea holds that when groups of individuals are left alone, without government oversight or regulation, they will spontaneously form a social and economic order that is superior in organization, efficiency, and the conveyance of information than an order arranged from the top down through centralized planning." It refers not to the artificial construction of a rational order by human design/fiat (e.g., by some government)  or some natural phenomenon but from from some unregulated but compatible/consistent pattern of voluntary human activities, based on the limited, situationally nuanced perspectives of participants.

I'm not going to describe here the ideas of "spontaneous order" which some (e.g., here) have traced back as least as far back as the Spanish scholastics and have been infamously referenced in Adam Smith's notion of the "invisible hand" and more recently in the work of Hayek. But it is difficult to see how any elite group of people could possibly have the economic, legal, social and situational context knowledge to design such an unknowable master plan, but the net effect of voluntary exchanges among people with limited perspectives is to achieve a mechanism for fulfilling individual/social needs without some preexisting plan, just as farmers were able to grow ample, diverse supplies of crops without top-down marketing orders, motivated by pricing mechanisms.

Now do I think spontaneous order provides better outcomes than the government? Generally, that's true when we implement the principle of Subsidiarity and limit the constraints on the market to things like protection of basic rights, public safety and enforcement of contracts. Government actions often have unintended consequences; for example, in the example of ObamaCare, we've seen some providers scale back their charitable work, many people have found they are paying higher prices even when transitioning to higher-deductible plans, and government program enrollees are finding it difficult to find a provider willing to accept them. We saw the Internet economy boom only after there was privatization of the Internet.   And that's even before we consider the problems of incompetent, inexperienced leadership, political corruption, regulatory capture, mercantilistic populism, etc. The government burden of taxation and regulation unnecessarily constrains voluntary fulfillment of individual/social wants/needs.

Linker's post then pooh-poohs the concept of spontaneous order as "Utter fiction. A fairy tale." Tell that to smartphone users when 30 years ago regulators were obsessed with the long distance wars and the concentration of local phone providers; tell that to IT consumers and web businesses that have developed in spite of, not because of government involvement. Tell that to consumers less dependent on oil from the world's most volatile region and where cheap, abundant natural gas has drastically cut down US generation of C02 emissions, despite of, not because of the current Administration.  Obama's point that "business didn't build that" is "indisputable"? On the contrary: the private sector funded its own infrastructure, built private charities, hospitals, and schools,  provided security and arbitration services, staffed volunteer firehouses, etc. He talks about public safety functions but fails to mention violations of individual rights, he assumes that the Fed's manipulation of fiat currency doesn't result in malinvestments and serial asset bubbles. He talks about our dubious meddling in the overthrow of the dictators of Iraq and Libya as something spontaneous order could have never done; let's be clear: dictatorial regimes impeded spontaneous order, and our meddling never stabilized the situation. If there was a black market to alleviate, say, shortages in a command-and-control economy, you are seeing spontaneous order. When you see organizations and countries sending medical/other volunteers and relief supplies to refugee camps, you are seeing spontaneous order. What Linker is attacking is a caricature.