Wednesday, April 29, 2009

Economic Skepticism

It's a subject I don't see covered very often, except in threads that tend to attract bad examples of Libertarians. (I'm currently unable to think of a good example of a Libertarian, unfortunately.) I'm mostly familiar with some fairly obvious stuff, like MLM scams and Ponzi schemes, but I'm not all that great at understanding economic problems. Suggestions for websites with good explanations of economic principles and some counter-intuitive things would be greatly appreciated.

6 comments:

Akusai said...

Yeah...Economics. Afraid I can't really help you there. Good examples of Libs, though, are Penn and Teller and Michael Shermer who, in his latest book The Mind of the Market says in the introduction that he's advocating a "nicer" version of social Darwinism. Fun.

Dark Jaguar said...

I'm no fan of libertarianism. There's stuff there I agree with but a lot of it can be taken way too far. Objectivism is even worse and has about as much to do with objectivity as scientology has to do with science. As a general rule, the biggest issues I have with those two philosophies is their preoccupation with the economy, as though economics is the be all end all description of the entirety of human interaction, and really all I care about are results when it comes right down to it, and all these do is just come up with a lot of internal thinking, outside of any actual real world tests or studies, to reach questionable conclusions about how we ALL should behave at all times to have perfect economy.

Good Math Bad Math has done a lot of stuff recently on economics, but that's more of a math blog and the guy writing it says he hates economics anyway, so that's not much of an option.

Dunc said...

I'm currently unable to think of a good example of a Libertarian, unfortunately.John Stuart Mill? More of a small-L libertarian than a capital-L Libertarian, and a good deal more sane and reasonable than most who self-describe as either these days. (I used to self-describe as a small-L libertarian, but the term's been so hopelessly debased that I've given up on it.) The key difference between reasonable libertarians and the usual crackmonkeys is that the former realise that the power of the state is not the only form of power, and that other modalities (such as economic power or social privilege) are equally important. The second difference is that they realise that there's a difference between the absolutely ideal of liberty in the hypothetical sense and what you can actually achieve in reality, and that this difference necessitates a degree of compromise and flexibility.

Dikkii said...

I'm afraid I've been away for too long, BD, but economic skepticism is something that I'd like to see more of myself, given my personal proclivities.

Whilst I like the central aim of Libertarianism, or even anarcho-capitalism (which is similar) we have too much evidence for the phenomenon known as 'market failure' to be ignored.

One of the central roles of government is to step in and solve this problem through legislation and regulations.

Libertarians like to pretend that market failure is either a temporary phenomenon, or it doesn't exist outright. Either way, they're barking up the wrong tree.

I used to describe myself as a small-a anarcho-capitalist until I realised how similar anarcho-capitalism is to Libertarianism, and I largely disown that now. Although I do agree with letting most markets do their own thing: Communism collapsed because communism likes to pretend that market forces don't exist.

(Sadly, they're as real as those forces labelled weak, strong, electromagnetic and gravitational)

Excuse me while I go back and read what else I've missed in the last few months.

Dark Jaguar said...

I think my biggest problem with libertarian ideas on the market is "the market is self-correcting" morality. The idea there is that if companies start abusing their consumers in horrible ways, such as poisoning them, the market will correct for that because no one would ever willingly poison themselves.

I'll ignore the myriad of evidence showing that sometimes the market can't correct, that sometimes people have no choice but to poison themselves, that often people don't know they may be doing so, as that's all been covered before.

Let's assume the market always will correct itself perfectly and these bad practices will always go away. What gets me is that, for these people, the fact that people will be getting hurt IN THE MEAN TIME while the market corrects seems to be an acceptable loss, and tha the idea behind regulation is to PREVENT these people from getting hurt to begin with, to prevent the damage that gets done during a "market correction" from occuring at all. It's not enough to just look at the before and after, the during has value too.

Tom Foss said...

The problem with finding economic skepticism is a lot like finding historical or political skepticism--it's very difficult to tease out the actual skeptical positions from individual political views.

As to libertarianism, I can't stand it. I've called myself a "social libertarian" in the past, but like Dunc said, the term's too loaded (with napalm-intensity burning stupid) anymore. I've got a lot of problems with libertarianism, but the primary one boils down to different ways of perceiving government, the people, and corporations. I see the government as an extension of the people as a collective (ideally/fundamentally), and corporations as extensions of individual people (sort of...I'm kind of having a hard time putting this into words). Libertarians apparently see corporations as "the people," or an extension thereof, and see the government as some kind of external entity.

Kind of to illustrate, I heard Tucker Carlson on the radio the other day talking about the high-speed rail proposal, and saying that he thought it was a good idea, and if it's a good idea--a profitable idea--then people will want it and pay for it, and it should be done by the private sector. My initial thoughts were that not all good ideas were profitable ones (and "profitable" is not a valid measurement of the goodness of an idea) and that if it's a government project, then the people are paying for it. That's what taxes are: the people paying for things.

Libertarians (and conservatives) often accuse liberals of putting too much trust into the government, and assuming that government is the answer to everything; then they'll turn around and insist that "the market" and "the private sector" are the answer to everything, and clearly in the hands of the market, everything works out for the public's best interest.

I simply don't see how a private sector could possibly be considered a better representative of the public interest than the republic is. Our only say in the operations of a company is through our spending habits; our say in the government is through our votes and our elected representatives. The former is an information-poor and unfairly-weighted system which doesn't allow consumers to enact any kind of direct change; the latter suffers from many of the same problems, but at least there's a mechanism for public control and input and influence.

Bottom line, I think the purpose of government is to do for the people what the people can't do for themselves. Government agencies exist to provide services that the people want (and often need) but cannot provide themselves on an individual or small-group level. The purpose of a corporation is to turn a profit. The government has a built-in source of funding (in the form of taxes) that allows it to take on projects that would be prohibitively expensive or insufficiently profitable for the private sector to do, and that allows turning a profit to be a secondary goal.

Given such a system, and given how we've seen deregulated corporations act, and given the current mentality that argues against long-term planning and stability for short-term wealth accumulation, I'm going to put my trust in the entity whose primary goal isn't taking as much money from me as possible.