Why I am not a Liberaltarian

Will Wilkinson offers what Karl Smith calls “Liberaltarianism in one sentence.”

It’s best to just maximize growth rates, pre-tax distribution be damned, and then fund wicked-good social insurance with huge revenues from an optimal tax scheme.

Karl muses, “A core hope of my engagement with the blogosphere is to determine why there is so much resistance to this idea.”

My resistance to this idea is not aesthetic. Max g sounds good to me, and fair, non-distortionary social insurance would be a great improvement over what we have now. Nor is it based on a priori taxation-is-theft libertarian dogma. I don’t believe in natural rights. My opposition, if you can call it that, to one-sentence liberaltarianism is practical, intellectual, and moral.

My practical objection is, simply stated, “You can’t get there from here.” If you study public choice, the economics of politics, you learn that there is a logic to why we have the institutions and policies that we have. To invert a title from Buchanan and Congleton, we have politics by interest, not principle. Or if you’re a Caplanian, majority rule means irrational rule.

Public choice issues are unavoidable. The interests that influence the government cannot be eliminated without eliminating the government, and possibly not even then. And if we eliminated democracy and therefore irrational voters, they would simply be replaced by irrational subjects, whose irrationality would constrain the dictator as surely as voters constrain democracy. There’s no way around public choice.

Liberaltarians sometimes point to Denmark (or wherever the example du jour is) and say, “If they can do it, why can’t we?” Leaving aside the question of whether Denmark actually achieves the liberaltarian ideal, most of the world is not Denmark. Certainly America will never be Denmark. It is too big and diverse. We could eliminate the federal government and divide into 50 states or an even greater number of city-states, matching Denmark’s size, but the people of most of these polities would still possess broader divergence of interests than Scandinavians do. In practice, the US will never get anywhere near a fair and efficient social insurance system (or max g for that matter), and the sooner we can all accept this, the better.

Intellectually, one-sentence liberaltarianism is better than pure leftism because it acknowledges some parts of economic reality. To maximize growth means to adopt free trade and low marginal tax rates and to drop the preoccupation with all forms of inequality. But it also adopts one of the worst features of leftism, the idea that there is a we that can choose how society should operate (conservatives and some libertarians think this too). Society is not designed. It emerges from our interactions. I can’t fully support any ideological statement that treats growth or goodness of social insurance as knobs on a dial that we can turn.

What troubles me the most, though, about one-sentence liberaltarianism is the moral poverty of the statement as the intersection of libertarianism and liberalism. I support Will’s and Brink Lindsey’s project of bringing modern liberals and classical liberals together for dialog. I think there is something very important that libertarians can learn from the left. Leftism, at its best, draws attention to the fact that there are people who are vulnerable and can be taken from. There is a caricature of libertarianism that avoids this and should not. What I wish would emerge from the dialog is an acceptance by liberals of economic reality—all of it, including public choice and the idea that society is a spontaneous order and cannot be designed—and an appreciation among libertarians that sometimes this vulnerability is a greater threat to well-being than bad economic policy is.

I think the liberaltarian coalition that I would like to see would come out strongly in favor of prison reform and of changes in criminal law. According to a friend of mine who studies these things, if you are sent to a medium- or high-security prison these days, the guards tell you on arrival that you must join the gang of your race because they, the guards, cannot protect you in there. Victimless crimes are prosecuted with discretion that inevitably gets used against the poor and vulnerable. I would like to see discussion of why in the world there should be criminal law in the first place. If all offenses were handled through the tort system, and tort claims were tradable so that the poor could always afford to prosecute, there would be no offense where there is no harm, and justice would be less discretionary.

Liberaltarians should come out strongly for open borders. Few people are more vulnerable than those who are born, by accident, in crappy places. They should be allowed to leave and live peacefully wherever they wish, including next door to me, by both liberal and libertarian principle.

Children are highly vulnerable in our society. Liberaltarians should oppose compulsory schooling, which in many places is hard to distinguish from incarceration. This is not to say that fewer children should attend school (though they should), but that giving them the right to leave would ensure that the worst abuses are avoided.

While I am gratified that liberals are learning about the enormous benefits of free trade and the very real harms caused by occupational licensing, my libertarianism is not primarily about max g. Rather, it’s mostly a moral judgment about how we should treat each other. Neoliberalism and one-sentence liberaltarianism obscure that to the point that I can’t really identify with either, though I’d be delighted for liberaltarians to meet me where I stand.

12 replies to “Why I am not a Liberaltarian

  1. Pingback: Why I am not a Liberaltarian « Why I am not…

  2. Eli Post author

    You could just as easily say that liberals’ insistence on the welfare state causes too many resources to go into the fight over the welfare state.

  3. Matt Simpson

    I think some liberaltarians know their Hayek and public choice and still want some form of social insurance (I’m looking at you Will Wilkinson). I don’t think you’re really engaging their argument, whatever it is.

    Also, libertarians who want social welfare abolished are making the same mistake that you accuse liberaltarians of making (I’m not accusing you of making this mistake!). Social welfare is probably here to stay. The goal should be to improve it within the bounds imposed by political realities.

  4. Eli Post author

    Matt, my point is not that if you know Hayek and public choice that you cannot also want social insurance. My point is that you should acknowledge that social insurance will inevitably be lousy, not “wicked good.” Once that is acknowledged then it is fine to say that lousy social insurance is better than none and to express a preference for it anyway, though that is not my preference.

    I agree that welfare is probably here to stay, though I think that we can all have different goals with respect to it. Some people may wish to be wonkish types and try to improve it, but I think that a dissident approach is fine too.

  5. Adam Ozimek

    Eli,

    It seems that you leave room for all of liberaltarianism with your statement that it is possible that “vulnerability is a greater threat to well-being than bad economic policy is”. Yes, public choice ensures we will never have perfectly efficient social safety nets, and “In practice, the US will never get anywhere near a fair and efficient social insurance system (or max g for that matter), and the sooner we can all accept this, the better.” But it’s still quite possible to accept that and also to accept that an imperfect safety net that is imperfectly efficient is more desirable than none at all.

  6. Eli Post author

    Adam, that’s right. I said as much in the comment prior to yours. If liberaltarians are willing to come out and say that social insurance will never be very good but that they support it anyway, my disagreement would be greatly diminished. I still wouldn’t support social insurance (because, after all, it’s not going to be very good), but I would see the disagreement as mostly about tastes.

  7. Adam Ozimek

    Eli,

    I think that just as surely as welfare and social insurance policies will never be perfect, they will never go away either. This is why I think the project of fighting for more efficient versions of these policies is often more useful than fighting for less of them. Which course is desirable, I think depends on the policies at hand. For instance, I would rather have a decent sized EITC than a small minimum wage.

  8. Eli Post author

    I agree that given a choice between an EITC and a minimum wage, the EITC is better unless the minimum wage in question is so small to not be binding on anyone (e.g. $0.03/hour).

  9. Adam Ozimek

    And given that we will have some welfare policies aimed at raising low-end wages, and given that the EITC is, I would argue, pretty close to “very good” in terms of efficiency (relative to that class of welfare policies), isn’t that a policy you would support?

  10. Adam Ozimek

    My broad point is that if public choice telling us welfare policies will always be imperfectly efficient will prevent you from arguing for the first best (some fair, non-distortionary social insurance) then shouldn’t the median voter theorem telling us we will always have some welfare policies also prevent you from arguing for your second best (no welfare policies)? To put it in your terms, “You can’t get there from here”, and welfare policies are unavoidable.

    So I agree, let’s abandon hope of the first best, which I think we share. But let’s move beyond your second best as well. We should be arguing instead for a third best: efficient welfare policies.

  11. Eli Post author

    No, not necessarily. I agree that in theory, a simple EITC can be very efficient. But in the real world, the EITC is funded with revenue that comes from other taxes, which are not very efficient at all. The income tax has tons of credits and deductions built in, and taxes on capital are highly inefficient. Consequently, the EITC is not particularly efficient, since it requires raising revenue inefficiently.

    Furthermore, as I wrote in the original post, my libertarianism is not about max g (efficiency). How should we treat people? I don’t think it’s right to treat other rich people as a means of helping the poor if that’s not what they wish to do. If that’s going to happen no matter what, I personally would rather support *no policy* at all and say that the whole system is corrupt and I want nothing to do with it. But I understand that other people have different views.

    I guess a one-sentence liberaltarianism that I could get behind is this: Help the poor and vulnerable by removing coercion from the system instead of adding coercion to the system.

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