Monday, December 17, 2012

Fifty Years of "The Calculus of Consent"

The bible on political is The Calculus of Consent by James M. Buchanan and Gordon Tullock, first published back in 1962.

Wow!  That means that we are celebrating its golden anniversary.  I wonder why I wasn't aware of this until today.  It's not as if people haven't been celebrating.

But I have been reading the book, so you don't have to.  No sex, no plot twists, you see.  Nothing to keep the reader's attention, except a devotion to learning.

In Calculus Buchanan and Tullock analyze the behavior of electors and politicians using the normal economic assumption that people seek to maximize utility, and with occasional resort to game theory.

Since I've just finished the chapter on special-benefit legislation using general taxation and the chapter on general-benefit legislation using targeted taxation, I thought you'd be interested to know what Buchanan and Tullock have to say.

In the case of special-benefit legislation, (e.g., getting the whole county to pay for a few peoples' road improvements) the average individual voter is going to get screwed unless he is able to bargain for compensation from the majority.  Since this is usually called "corruption" except when legislators do it informally in the process known as "logrolling" you can see that special benefit legislation is a bad deal for the average person.

In the case of general-benefit legislation, let us just quote from the book:
If the dominant majority is able to impose the full costs of general-benefit projects on the minority, it follows that all projects yielding any benefits at all to the majority coalition members, and costing no more than the maximum taxable capacity of the minority, will be adopted without question... [F]or all such projects a member of the majority coalition may secure some net benefit without cost to himself.(p.166-7)
As in "the rich pay a little more" Mr. President.

So Buchanan and Tullock judge that: "There is nothing in the operation of majority rule to insure that public investment is more 'productive' than alternative employments of resources".

An interesting claim in Buchanan's and Tullock's analysis is that "side payments" (or logrolling or graft or bribes) tend to reduce the amount of over-investment.  In other words, when the majority has to pay off the minority in order to get its project passed, then the value of the project to the majority is reduced, and the less "productive" investments won't get passed.  This seems to go against common sense.  You would think that, if side payments were forbidden, that it would be harder to pass special interest legislation.

But you can see why limited government is a good idea.  If there is no identifiable benefit from public "investment" then maybe we should all get together and limit the ability of organized minorities and dominant majorities from imposing costs on their fellow citizens.

Try telling that to President Obama.

Thursday, December 13, 2012

The Canon of Limited Government

The foundation of the human condition is simple.  Humans are social animals.  We are groupish; we do things together.  In that we are like the chimpanzees, where the males work together to defend a food-bearing territory, and we are unlike the orangutans, where males are solitary except during the mating season.

It is said that if you put a group of Americans into a room to solve a problem they will do so, and they will solve the problem by trying to take care of everyone's concerns.  My own experience bears this out.  When I was sent into a room years ago with eleven other Americans to try a man for first-degree murder the question turned on two female teachers that weren't quite ready to go "beyond a reasonable doubt."  It took gentle persuasion to get to unanimity, helping the two holdouts to agree with the rest of the jury by satisfying their own doubts about the defendant's guilt.

But there is a serpent in the garden.  "Men like power and will seize it if they can," writes Nicholas Wade in The Faith Instinct.  Humans are not just social animals, from the Latin "socius" or companion.  Humans are political animals that like power.  So it is that politicians are dividers.  You can put a group of Americans into a room together, and they will likely work out a solution to their problem.  It follows that it takes a politician to keep Americans divided and get them to fight.  That is what an election is all about, to reduce the seizure of power from a real civil war into a civil war by other means, a vigorous exchange of insults and anathemas between two political armies arranged on the field of battle.  But of course a political election has winners and losers, unlike the consensual persuasion of Americans-in-a-room, and the winners get to occupy the seat of government and impose their will on the losers.

Which reminds us that government is force.  The word comes from the Latin "gubernare," to steer.  It is not true, as a video at the 2012 Democratic National Convention proposed, that "government's the only thing we all belong to."  We all belong to the human race; we all belong to society; we all belong on the Earth.  We belong to the government in the same way as soldiers belong to the army: both have the power to force us to do things.  Is that the best that we can hope for?  To belong to an organization with power over us?  Of course not.  We have another name for the "thing we all belong to" when you remove the force: we call it society: from the Latin "socius."  Thus David Cameron's catchphrase: "There is such a thing as society; it's just not the same thing as the state."

Let us return to Nicholas Wade and complete his maxim about men and power: "But if they can't rule, their next preference is that no one rule over them."  That is the calculus of power.  It's great to rule, and men like it when they can get it.  But if they can't rule, nobody else should either.

But how can you decide: between power and the absence of power?  The answer is that government should be limited.  There's nothing remarkable about that.  If we don't like other people seizing power over us, the solution is to go into a room together and hammer out a social contract that limits everyone's power over others, and limits the power of every group over other groups.

And as we know, humans are social animals; we are groupish.  If you put humans into a room together to solve a problem...

Wednesday, December 12, 2012

Internal Colonialism in America

No, I am not talking about slavery or the Trail of Tears.  I am talking about the colonial regime of today's liberals, ruling class of the administrative welfare state.

Nor am I channeling some way-out right-wing whacko.  I am amplifying what Jürgen Habermas and James C. Scott have written.  And they are good card-carrying global lefty academicians.

The idea of "internal colonialism" is that the modern administrative welfare state acts towards its native citizens the way that colonial regimes once acted towards their "natives."  It treats them like children that aren't really competent to decide their own affairs.  It organizes the education of the nation's real children, because what about the children of illiterate parents that can't make the right decision for them?  It organizes unemployment relief because who can expect the workers to do it for themselves?  It organizes health care for grannie and pensions for grandpa--after all, who can trust their health care to insurance companies or their money to the Wall Street casino?

The reality, of course, is that nobody looks after other peoples' money--or anything else--better than they look after their own.  So the administrative welfare state is in the process of degenerating from a paternalistic welfare state into a naked grab for loot.

But how does the welfare state really compare with a real colonial regime, like the British in India?

The British started by establishing trading posts in the early 18th century, and then started meddling in local politics, because, after all, commerce may not be interested in politics, but politics is interested in commerce.  By about 1800 Britain was a real power in India and Edmund Burke had made a scandal of Governor Warren Hastings and his looting of various Indian princes.  So we may say that 1800 marked the transition from a buccaneering era into a more avuncular era.  But then came the Great Mutiny of the Indian Army in 1857 that was experienced by the Indians as the Great Uprising.

The Great Uprising failed, let us say, because India was not yet a nation.  It hated the British, but it was not unified and organized.  But 1857 marked the beginning of the end, as the British became simply imperial overlords, expert in keeping India divided and subservient--for a while.

At the turn of the 20th century the Indian National Movement started to become a real power.  It was led by men like Mohandas Gandhi, a man from Gujarat who traveled to London to become a British barrister.  Then there was Jawaharlal Nehru; he went to Harrow, the same British public school as Winston Churchill, and then university at Cambridge.  When these men returned to India they understood the British through and through and they led the Indian National Movement to victory; they knew how to make British power in India into a worldwide scandal and an embarrassment to the British.   It was political idealism at its very best: that is why Gandhi's brilliant non-violence tactics have been emulated across the world.

When you look at liberal colonialism in America, it is clearly a horse of a different color.  It begins not in the messy buccaneering of Clive and Hastings but in a political ideal: to reform political corruption and make US politics more rational.  That is how the Progressive movement at the turn of the 20th century experienced itself.  America should have a proper central bank, progressive income taxes, and a social safety net, they said.  Ordinary Americans just couldn't do that on their own.

But then came the 1930s in which the Progressives utterly failed to make the central bank mitigate the Crash of 1929.  And then they administered the US into a ten year Slough of Despond by waging war on business.  A disaster like that requires a world-class coverup, and the Progressives became liberals, converting the failures of Franklin Delano Roosevelt into wonderful successes, and cementing their dynastic power by combining their movement with the big-city machines into a nation patronage operation.  So now the Progressives had graduated from being rational reformers into a ruling class with an agenda of maintaining their power.

The 1970s were a serious reverse for the liberal ruling class.  Their civil rights agenda ended in urban riots, their adventures in Vietnam into an unpopular war, and their social revolution into serious backlash.  So Ronald Reagan got to be president and show that it didn't need to be that way.  Anyone with eyes to see could tell that there were unintended consequences of administrative liberalism that even the liberals didn't see coming.  Liberals might think of themselves as the evolved, the educated people.  Others weren't so sure.

So liberalism entered its third phase.  The first Progressive phase was one of idealism and high-minded reform, the second New Deal phase one of benevolent dictatorship.  But in 1990, after the Reagan revolution, liberals opted for trench warfare and would do anything to keep their cultural and political power.  The party that passed the civil rights acts in the 1960s became the party that whipped the black vote into a monolithic bloc.  The party of the working man became the party of universal entitlements.  The party that urged us to rise above small-town narrowness cynically divided America any which way to win the next election.

Obviously, when a political class has descended to trench warfare to hold onto its power then it is entering a period of strategic retreat.  The only question that remains is whether its retreat is accompanied by scorched earth, whether it wrecks the nation in the process of losing its power.  In the Anglosphere the last two transitions of power have been benign: the landowners gave up power without a fight, and the bourgeoisie surrendered power to the working class even as it mucked up the economy.

But will liberals do the same?  Will they give up their internal colonial empire without a knockdown drag-out fight?  That is the great question as we head past the current "fiscal cliff" to the badlands of sovereign default and economic ruin.

Friday, December 7, 2012

"Internal Colonization"

Marxists may be terminally annoying, but they continue to produce compelling critiques of modern society.

Whereas liberals are totally useless.  Being the ruling class, liberals produce nothing but shoddy apology.

So let us look at Jürgen Habermas, a neo-Marxist who has brought the old Marxist idea of alienation to fruition.  The old Marxist idea was that modern labor under capitalism was alienating because labor was no longer social labor, working to create use value, but abstract labor, working to produce exchange value.

On top of that, Marx claimed, the actors in the capitalist market "reified" their activities.  They did not think of their relations as person-to-person, but thought of their activities in terms of thing-to-thing, an exchange of commodity for money.  That is what he meant by "commodity fetishism."

Habermas restates all this in terms that make sense to the average bear like me, by dividing the world up into "system" and "lifeworld."  Instead of abstract labor we have System.  Instead of social labor we have Lifeworld.  System is the market, and Lifeworld is the person-to-person relation.  More than that, System is the world of rational and strategic action.  You do almost everything in the market for gain, and it is very rational: sell, buy; make, create; up, down.  But the Lifeworld is not like that.  It is social, cooperative; it is language based, not reason based.  It is not up or down, but tries to create a consensus, a sharing.

Following Horkheimer and Adorno in A Dialectic of Enlightenment Habermas makes another important step.  He understands that the state, just as much as capitalism, is a rational system.  Both systems are based on "instrumental reason," trying to make things happen in the world by rational means.  And that means that government and business are both trying to "dominate nature and other men."  This means that government's project is the "internal colonization" of society.  Just as the European nations of the 18th and 19th century went around the world colonizing less powerful societies, so the modern state attempts to colonize its people with its experts and its bureaucrats, its regulation and its spending.

This is a punishing critique of the modern state, and a warning about its power.  We should be just as careful about government power as about business power.  Conservatives tend to worry about government power; liberals worry about corporate power.  But Habermas warns about all system power.

There is a difference between the two systems, beyond the analysis of Habermas.  It is that government is all about war.  When we say that government's primary job is to defend against enemies foreign and domestic we really mean that it is government's job to wage war on enemies foreign and domestic.  In other words, government is at loose ends unless it has an enemy to fight.  William James famously articulated this truth just before World War I when he advised that, since war was now unlikely, we would have to gussie up the "moral equivalent of war" to mobilize people to do important things.  We can see the truth of this in the periodic campaigns that government comes up with: War on Want, War on Poverty, War on Drugs, Whip Inflation Now.

But this gives conservatives and limited government advocates an opening.  When deciding whether to start a new government program we should ask ourselves: is war the best way to do this?  Because every government program is about force.  It does not say, wow, saving for retirement is really a good thing, why don't we all save from our wages!  It says you must pay 15 percent of your wages to the government in return for a pension, or else.

So then you ask: if saving against a rainy day is a natural human thing to do, why do we force everyone to save?  If insuring against sickness is a natural thing to do, why do we force everyone into Obamacare?  If everyone can see the importance of getting an education, why force everyone into a compulsory government plan?

The answer comes easily from Habermas' idea of "internal colonization."  Because we, the ruling class, want to rule.  We don't want you running off and saving your own money; we want to force you to bank the money with us.  We don't want you running off educating your kid according to your crazy ideas; we want your kid indoctrinated with ruling class ideas.

But why do people put up with this?  Simple: there is an obvious attraction to colonialism.  If you go with the colonial masters you get to enjoy the free stuff, and maybe sup at the master's table--below the salt, of course.

But for some reason the colonized peoples of the 19th century didn't like the overall package.  They preferred to rule themselves according to their own way rather than truckle to their European colonizers.

The question for us is whether we continue to truckle to our native-born internal colonizers in return for all the free stuff.  Or whether we rise up and declare that we would rather live in our own way, backward and flawed, rather than ape the ways of our colonial masters.

Of course, today the question is moot, as President Obama takes us into the miasma of internal colonization on steroids.

But when the Obama years, "the years the locusts have eaten" are over, we will visit the internal colonization question again.

Nobody knows what answer the American people will give.