Friday, October 17, 2014

The Administrative State Doesn't Work. Because Hayek

You are a liberal cringing right now at the Keystone Kops routine at the Obama administration over Ebola. It wasn't supposed to be like this. The oceans were supposed to be receding and the planet healing.

Because government is the name of things we do together.

But there's another narrative about government. Start with Charles Dickens and the Circumlocution Office. It was staffed with Barnacles and Stiltstockings, and its motto was "How Not to Do It."

Sound familiar?

I've always understood who the Barnacles were. But now I understand the Stiltstockings. They are the useless spokesmen mouthing stupid platitudes to stupid media.

Then there was Ludwig von Mises. In 1920 he published an article "Economic Calculation in the Socialist Commonwealth." He argued that socialism couldn't work because it couldn't compute prices. It wouldn't know what things cost. Then Mises wrote his Socialism. Then he wrote his Human Action.

Along came F.A. Hayek. He wrote in The Road to Serfdom that the administrator in any government program could not know enough to compete with the collective wisdom of millions of consumers and producers in the marketplace.

Of course the inability of the socialist managers to know enough is the least of their problems. The main problem is that government always ends up serving the needs of its cronies rather than the public interest. Because that's how political power works; it's who you know not what you know.

Today there's a charming piece by John Daniel Davidson, "Ebola and the Failure of the Administrative State." It's about liberal faith in the administrative state.  For some reason there's a lot of incompetence and lack of preparedness in the federal government's response to the Ebola scare.

Who could have seen that coming?

Back in the late 19th century, Davidson reminds us, liberals like Woodrow Wilson were extolling the efficiency of the administrative state. Said the future president:
Administration is everywhere putting its hands to new undertakings. The utility, cheapness, and success of the government’s postal service, for instance, point towards the early establishment of governmental control of the telegraph system. Or, even if our government is not to follow the lead of the governments of Europe in buying or building both telegraph and railroad lines, no one can doubt that in some way it must make itself master of masterful corporations.
The trouble is that liberals have followed Wilson's naive faith in administration for over a century. Without thinking. Without questioning.

And we know why. Liberals have always assumed that the administrators and managers would be people like them. Educated, evolved. Rational. Open to new ideas.

Except that for some reason liberals haven't been open to the ideas of Mises and Hayek. How could that be?

Could it be that, despite their education and evolution, despite their rationality and openness to new ideas, they just could not bring themselves to consider ideas that brought their whole administrative state movement into question?

And we have not brought into the equation the rational ideas of Buchanan and Tullock in The Calculus of Consent. They argue that the way that a legislature works is that a minority that wants to spend government money just bribes enough additional legislators to get a majority. The result is a majority that plunders the minority, as in Obamacare and its Louisiana Purchase and Cornhusker Kickback, simple legislative deals to buy the votes of senators to get the final votes to pass Obamacare.

Nobody can know what the administrative state failures in the Obama era will cost the Democratic Party. Maybe a little; maybe a lot.

But remember this. The liberal apology for liberal power rests on the superior qualities of liberals: their education, their reliance on science and expertise, their openness. Yet liberals have ignored the conservative and libertarian critique of the liberal administrative state for nearly a century.

Who then are the educated ones, the curious ones, the rational ones? Because if liberals can't show themselves as educated, evolved, and rational, then they are just an ordinary ruling class: proud, cruel, corrupt, unjust, wasteful. Just like all the other ruling classes on the waste heap of history.

If that is true then maybe it's time we found ourselves a new ruling class, one that really was educated, evolved, rational, and open to new ideas.

Oh, and maybe the new ruling class would start out with the idea that the power of the ruling class ought to be limited. As in limited government.

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