Monday, February 25, 2013

Max Weber's Economic Framework

Max Weber, he of The Protestant Ethic and the Spirit of Capitalism, developed a three point framework in which to evaluate state economic policy.

Actually, in General Economic History he divided it up into traditional economic policy and rational economic policy.

Under the old tradition, states had two objectives.  First, they wanted money from the land they controlled.  Weber calls this the "fiscal interest."  Second, they wanted to continue the "customary standard of living."  Weber called this the "welfare interest."(p.344)

I think that we tend to underestimate the importance of this traditional economics.  Really, the whole policy of the modern administrative welfare state is to attempt to satisfy the universal instinct to continue in the current ways and preserve the current standard of living.

It is the modern, rational approach to life, instantiated in the progressive businessman, that brands this old idea as a chimera.  In the modern economy--really in life itself--you gotta keep moving.  Otherwise you suffocate and die.

But most people hanker after a cloud-cuckoo land in which their yearning for an uneventful, secure life is realized.  Hence the medieval guild, the modern labor union, the wails from people on "fixed incomes" when anything goes wrong.

The modern era features the rational state and a rational approach to economic policy, i.e., policy based on a theory.

The first modern theory was mercantilism, according to Weber.  Here the state realizes that its revenue depends upon the ability of the economy to yield revenue.  The idea is to treat the state as a business, buying low and selling high.  Here is Weber in General Economic History:
Hence mercantilism signifies the development of the state as a political power, which is to be done directly by increasing the taxpaying power of the population.(p.347)
That's why the mercantilists thought that a country became powerful with a trade surplus.  It meant that specie would flow to the exporting state, money that could be taxed.  Flowing from that was the idea that the trade of the country should be conducted by the merchants of the country, and carried in ships owned by the merchants of the country rather than others.  We can see that this attitude survives today in the notion of crony capitalism and the shuttling of bankers between banks and government.

But the independent class of entrepreneurs didn't like mercantilism, because it shut them out.  And then came Adam Smith arguing that free trade, rather than government managed trade, was the way to riches.  This new thing, pushed in Britain by the Puritans, was "capitalism oriented in relation to market opportunities which were developed from within by business interests themselves on the basis of saleable services."(p.350)

The power of Weber's analysis allows us to see that all three approaches to the national economy are still fighting for influence.  The average person wants only to maintain their standard of living.  The government and the ruling class wants to increase their power.  And the businessmen (crony capitalists excepted) just want the freedom to create and sell products.

Under Ronald Reagan, the state became more powerful because it stepped back and allowed a hundred flowers to bloom.  Under Barack Obama the state becomes less powerful because it insists on controlling everything.  As it says in the Tao:
The ordinary person who uses force,
will find that they accomplish nothing.
Oh well.  Every generation must learn its lesson the hard way. 

Wednesday, February 20, 2013

How Much Freedom Do We Want?

We humans are social animals.  So far so good.  But in our modern era we preen ourselves on our emergence from the Dark Ages into the Light, from superstition into Enlightenment.  Today we are free, whereas people used to live under oppression: feudalism, patriarchy and all that.

But the curious fact about our modern era is the discipline.  Never mind the discipline of the old slave plantations.  What about the discipline of the factory?  Or the discipline of the schools, the government child-custodial facilities?  Or the modern office, with its ranks of dutiful drones sitting in front of their computers?   Construction: everything according to the charts and scratching of the project management plan.  Or the one-size-fits-all entitlement programs.

Do we moderns really want to be free, as the right proposes?  Or liberated, as the left proposes?  Or do we just want to be told what to do in return for our free stuff?

Here I am in this blog, busily damning to hell the injustice, the cruelty of the modern administrative welfare state: government is force, I say; politics is division; system is domination.

Here we have our liberal friends damning to hell the injustice, the cruelty of the modern corporation and the dastardly Koch brothers.

Could both be right?  If so, it could be that our modern society is the most oppressive, exploitative that there ever was.

Think about it.  In the bad old days of the feudal system at least the average peasant could run his day-to-day life without the constant interference from his lord.  Of course, if he didn't show up to do his share of the work on the lord's demesne, or pay his annual share of the crop, he'd be in a whole heap of trouble.  But otherwise, it seems to me, the lord left him alone.

Today the government is intensely interested in the details of our lives.  It makes us "legible."  It taxes us beyond the dreams of the old patriarchs; it wants to tell us what to eat, what to think.  It tells us how to save for retirement; it organizes our health care.  And of course it takes our children away from us to confine them in those government child-custodial facilities.  No exceptions.

Do we moderns really want freedom?  Or do we just want our modicum of free stuff and the luxury of complaining about our rulers as they order us about?

Maybe we just want to go with the flow until our rulers throw us over the cliff.  But then, by golly, we will show them!

Friday, February 15, 2013

The People of the Responsible Self

We conservatives are the People of the Responsible Self.  The responsible self was invented back in the Axial Age in Confucianism, Hinduism, Buddhism, Judaism, Christianity.  And I suppose, Islam.

That's what Robert Bellah suggested in his "Evolution of Religion."  I blogged about this back on 9/11/2012.  Bellah argues that the Axial Age of "historical religions"
highlights the conception of a responsible self, a core self or a true self, deeper than the flux of everyday experience, facing a reality over against itself, a reality which has a consistency belied by the fluctuations of mere sensory impressions... [T]he historic religions promise man for the first time that he can understand the fundamental structure of reality and through salvation participate actively in it.  The opportunity is far greater than before but so is the risk of failure. (my italics)
You can see that conservatives are the people of the responsible self by passing in review Ken Blackwell's sixfold typology of conservatism.

The social conservatives, according to Ken, are people that care about things like judges.  In other words, they are concerned, let us say, with the organization of civil society.  People that act in civil society are people that think they have a responsibility to serve their community.

The Christian conservatives are the "the pro-life and traditional marriage crowd, and are also passionate about religious freedom, home schooling, and raising their children with their beliefs."  If you don't think that approach to life is reeking with the idea of the responsible self, I gotta bridge I want to sell you.

The Second Amendment conservatives are the folks that think people should be allowed to possess the means of defense against the bad guys.  They think that when seconds count, the police are minutes away.  So there is no substitute for the responsible armed citizen that is ready to subdue a breaker of the peace.

The economic conservatives are people that have a  problem with taxes and government spending.  They think that people acting as producers and consumers in the market are the best people to make responsible decisions about economic matters.

The philosophical conservatives are committed to the idea of limited government.  Not much difference with the economic conservatives, except that they are thinking about how to implement and protect the institutions and the processes of limited government.  If the government is limited, then people need to be responsible.

The national security conservatives think that we should be serious about defending our nation in a dangerous world.  They just feel a responsibility to make sure that the US maintains a strong defense.

What unites our liberal friends is the marginalization of the responsible self.  Liberal elitists believe in the educated self, the creative self, the expressive self, the critical self, the compassionate self, but rather sneer at the bourgeois responsible self.

The clients of the liberals, the folks getting all the "free stuff" from the administrative welfare state are what I would call the People of the Pre-responsible Self.  They are people that would be responsible selves by now if only liberals hadn't enticed them into the liberal plantation with promises of loot and narratives of marginalization and victimization.  Liberals encourage their clients to abdicate responsibility and blame someone else.  The one big thing we need to do in America is to introduce the people of the pre-rational self from out of the sleep of ages to the idea that they could be responsible selves.  And transform their lives.

It's not earth shattering, this business of the responsible self, but it explains a lot.

Tuesday, February 5, 2013

The Slavery Issue of Our Time

I've had this argument a couple of times.  The other guy says that Social Security is much safer than having your savings in the stock market.  Take the market of 2008.  You could lose half your money.  How are you going to retire on that?

My answer is, of course, that you have to put your retirement off for a couple of years.  And for a white-collar or professional guy, what's the problem with that?

Because the truth about Social Security is that it is a return to the feudal age.  Under Social Security the young and the poor pay taxes that go to the old and the rich.

Let's make the difference clear.  Under a private system of superannuation, workers save money from their wages and sock it away in banks and mutual funds.  When they have saved enough, then they can retire.  If there is a nasty financial crisis that takes the stock market down, then they have to put off retirement and keep working.  On this system the monkey is on the would-be retiree's back.  If the economy is in the tank you can't afford to retire.  You have to work alongside everyone else to put it back on its feet.

Under the government's system of Social Security you pay taxes according to the government's schedule and then, at a certain age, you get to receive a pension without regard to the economy's ability to pay.  If there is a financial crisis that takes the stock market down you still get your pension at the same time but the government borrows money if there is a shortfall. We know who gets to pay for the borrowed money: not the old 'uns.  With the Social Security system you got your rights, and the government forces the workers, people probably younger and poorer than you are, to pay up.

There is a word for the government's system: Injustice.

Now there are special cases, no doubt, to justify the use of government force.  People with disabilities, genuine ones.  Manual workers, whose bodies give out at about age 45.  Widows, orphans, druggies, you name it.  But the average person these days is a white-collar worker, and that white-collar worker--I am talking about you and me--can usually work a year or two more when things get rough.  Isn't that the caring and compassionate thing to do?  Nobody would want to put the whole burden of getting out of a financial crisis on the young generation, would they?  Would they?

Jeffrey Lord in The American Spectator puts the whole thing in context.  The "slavery issue" of our time is Big Government.  The Democratic Party, for obvious reasons, is the Big Government party, but the Republicans are split on the Big Government issue, like the Whigs were split on the slavery issue in the 1840s and 1850s.  The question is: where does each and every Republican stand on this issue?  Do you stand with the Bushes and the Roves, who want to compromise the issue, or do you want to have it out, like the Reagans?

Jeffrey Lord's argument, of course, is that a Republican Party that is split on the Big Government issue is heading for the exits, like the Whig Party.

But the real problem is my friend, who thinks that Social Security is safer than the stock market.  He's not going to be willing to take a haircut on his nice safe Big Government Social Security benefits until the furnace of default threatens to burn his hair off anyway.  And then it is too late.

Let's face it.  The voters are going to want to muddle through on Big Government until it is too late.  The tragedy of the mid 19th century wasn't the demise of the Whig Party.  Who cares about a political party, anyway?  The tragedy was that the slave power was too wedded to its exploitation system, and wouldn't countenance a path to end its injustice and its disgrace.  So 600,000 young Americans had to die instead.

The same thing applies to the Big Government issue, the slavery issue of our time.  The tragedy is not that the Republican Party might get plowed under.  The tragedy is that the longer we put off reforming Big Government the more people are going to suffer when the end comes and the government goes Greece or Argentina.

Minorities and women hardest hit, of course.  That goes without saying.