From: phoenix@ugcs.caltech.edu
Date: Fri Jan 15 1999 - 20:29:33 MST
Dick.Gray@bull.com wrote:
> arguments, i.e. it's not only what works, but what's right. Nevertheless,
> market freedom can be, and often is, defended on purely practical grounds
> apart from ethical considerations. The same doesn't seem true of socialism
> (at least not any more).
Socialism, no. That doesn't mean total market freedom is the only
alternative.
Until a few weeks ago I called myself a classical liberal, meaning my
positions were close to libertarian but my reasoning wasn't; the difference
between Hayek and Ayn Rand. Now I call myself confused. The difference was
reading Galbraith's _The Affluent Society_, which is modern liberalism (or
one variety) presented by an actual economist. I will attempt to summarize.
Growth is good. But as with most things, the more we've had of it, the less
urgent the next bit is. Diminishing marginal returns. Decent housing, good
food and clean water are more urgent than mansions and SUVs.
On practical grounds, almost no one likes unfettered competition applied to
themselves. Humans are loss avoiders. People can deal with great inequality
when they themselves aren't worried about the means of existence. When the
market drops people out of the middle class they get agitated. They become
less concerned about the rights to property they no longer have and more
concerned with the right to existence. It's no good telling them they're
being inconsistent.
On practical grounds, shirking is less of a problem when dealing with people
who enjoy their work. The incentives from welfare or unemployment insurance
and from progressive income taxes have less relevance for the teacher or
scientist who has already passed up a high paying job as a doctor or lawyer
than for a blue collar worker whose work is toil. He calls "the New Class"
the increasing group of educated people who like their jobs, value job
satisfaction more than increasing their incomes past a certain point, and
expect both satisfaction and freedom from stress about their basic material
needs. In general, they won't laze on welfare; they'd get bored. In general,
they're not out to steal your yacht; the benefit isn't worth it. And some of
them enjoy automating toil, freeing up workers who can be educated and brought
into the New Class.
So. On practical grounds, private ownership and production are a success, and
vital to any society, and urgent for any poor one. On practical grounds, a
wealthy society does not need to be growing at the fastest possible rate,
which is why its members will be buying insurance and engaged in other
members, not all market friendly, to protect their elemental affluence. A
wealthy society can afford to sacrifice 1% of GDP growth and buy basic social
insurance for all of its members, and to ensure that all have access to basic
food and medicine, and above all to a good education. This will make
people happier; most feel more secure from want, and the rich don't have to
imprison themselves as they're doing right now in Brazil.
He also points out that a moderately managed society might be more productive
than a laissez faire one, in that it would avoid the very severe productivity
loss caused by the deep recessions such as America had frequently in the 19th
century. Lots of people unemployed equals lots of people not producing.
Eh. This'll have to do for now. It's a good book.
-xx- Damien R. Sullivan X-)
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