GSO/Guilford Pols

August 2014

Sun Mon Tue Wed Thu Fri Sat
          1 2
3 4 5 6 7 8 9
10 11 12 13 14 15 16
17 18 19 20 21 22 23
24 25 26 27 28 29 30
31            

« SOTU | Main | Crunch time on North Elm »

Jan 28, 2010

TrackBack

TrackBack URL for this entry:
http://www.typepad.com/services/trackback/6a00d8341cc33e53ef0120a81cdd85970b

Listed below are links to weblogs that reference Isn't it ironic?:

Comments

Feed You can follow this conversation by subscribing to the comment feed for this post.

Andrew Brod

The interesting nugget for me is the claim that neoliberalism has led to more government than "Labour collectivism" ever did. (It's worth noting that the British use of the term "liberal" corresponds roughly to that nearly defunct American species of moderate Republican, but perhaps also to some centrist Democrats.)

The U.S. government has certainly expanded over the years, under Republicans as well as Democrats. But much of that is demographic in nature (Social Security, Medicare). The moderate governing consensus that spans the two parties has promoted liberalized markets, but has that really come with more regulation and monitoring? Aren't some of our biggest concerns right now the absence of sensible regulation, for example in financial markets (nonexistent for some products) and food safety (outsourced to China)?

According to this book review, we have a spectrum of sorts. On one end is libertarianism, which advocates for markets with no oversight. In the middle is neoliberalism, which advocates for markets but with oversight. On the other end is collectivism or socialism, in which government owns and operates many otherwise-market-based activities, but its involvement is actually more passive and less invasive than under the neoliberal model.

Even if neoliberalism is fundamentally more government-intensive than socialism (and I'm not convinced), the bigger question is whether the overall result is worse than at the ends of the spectrum.

justcorbly

...in order to inject markets into every corner of social life, a government needs to be highly invasive... (from the review).

The market may be an early and inevitable product of trade and commerce, but a free market --free of the ability of powerful sellers or buyers to manipulate the market toward their own ends, distorting the impact of supply and demand -- is not. A free market can only exist if another, external, player protects it from manipulation by the wealth and power that inevitably accrues to the few. Protests that we should ignore the accumulation of power and wealth by the few because everyone else has a shot at becoming powerful and wealthy ignores the reality that very, very few will actually succeed.

In the end, the market, free or otherwise, is not the appropriate device for managing all aspects of society. So long as resources remain less than infinite, no single approach will be up to the job. The choice comes down, as it always does in issues of governing, to whose rights are restricted in orer to protect the interests of everyone else. Power and wealth, and the willingess to abuse power and wealth, inevitably accrue to fewer and fewer people, absent some external force. This means that any society in which all are always free to do as the choose will devolve into a society controlled by the few.

Andrew Brod

JC, to an economist, saying that unregulated markets are always manipulated by the rich and powerful is just as inaccurate as saying that unregulated markets always do what's best for society. In each case, sometimes they do and sometimes they don't. Some markets can exist and function properly even without that external player, as you put it. Much of economics is studying when things work and when they don't.

But if we replace "market" with "economy" in the above, then I agree with you. An economy can be thought of as a collection of markets, and there's no way that all of them can operate well without oversight. And we've learned that macroeconomic oversight is important as well.

However, whether society benefits from the neoliberal synthesis is a separate question. As a liberal (in the sense previously noted), I disagree with you that markets tend not to work, and it's precisely because resources are finite. Markets are ingenious ways of coping with scarcity. And there's just as much risk--I'd argue more--of society being controlled by an elite when resources are destributed by fiat as by the market.

The benefits of a market-oriented society come with a cost, and that's the part that this book review failed to address. If the benefits outweigh the cost, then the growth of government (if that thesis is true) is worth it.

justcorbly

Andrew, I'm not an economist, so in that area I will defer to those who are. That said, I am not convinced that thinking of managing and governing a society only in terms of markets or an economy is adequate. I tend to think of things in terms of power distribution. From my perspective, success in any economic model is a means to the end of acquiring power.

I hope I did not say that markets tend not to work. That was not my intention. Markets obviously work. But, they also tend to create their own elites that are able to exercise disproportionate influence over the distribution of scarce resources. From the vantage point of concern about the inequitable distribution of power, I don't see any real difference between an elite empowered by government and an elite empowered by the market.

That's also a conundrum for which I have no solution.

Andrew Brod

JC, since we're both speaking in generalities, we might find, say over a beer, that we mostly agree. I certainly wouldn't support policies that organized everything in society as though it were a market.

(For example, some analysts have advocated markets for adopting babies. Hey, they're scarce and markets are good for allocating scarce items, right? And yet the idea is repugnant to me and many others.)

The book review just states that society is more market-oriented than in the past, thanks to neoliberalism.

The comments to this entry are closed.