Supporters of free markets are often attacked for their “Do Nothing Principle” position, which tends to deeply upset policy wonks and media talking heads alike. Obviously this is buncombe, and to the contrary it is these would-be do-somethingers who are intellectually or ideologically incapable of grasping the sweeping scope of necessary changes that free market advocates are calling for.
For example, the charge that “Hangover Theorists” are selfish moralizers who want poor and middle-class families to needlessly suffer during a recession is prima facie incorrect. The interlocutor is simply misled by my yawning enthusiasm for his policy prescriptions into thinking I have no “serious” and “realistic” plan to help society, and that I want to “do nothing.”
Do nothing you say?
To the contrary, I advocate doing a lot, including the complete abolition of the Federal Reserve, the US Treasury, the US Federal Mint, the US departments relating to labor, trade, banking, securities, etc. It is those who want to merely tweak a bit here and there who are hem-hawing over making serious policy changes, and who have the gall to accuse me of advocating to “do nothing”!
There are some seriously mistaken individuals who seem to think so. Take a quote like this:
The recognition of the insuperable limits to his knowledge ought indeed to teach the student of society a lesson in humility which should guard against him becoming an accomplice in men’s fatal striving to control society [and destroying] a civilization which no brain designed but which has grown from the free efforts of millions of individuals.
– F.A. Hayek
They say that Hayek’s insight also applies to libertarians and, for example, our attempts to “force” free trade and unregulated labor markets on “society.”
Guilds, poor laws, and limits on trade also grew from the free efforts of millions of individuals, did they not? Well, no, actually they didn’t — at least not insofar as they attempted to use the state to impose the preferences of some on others by force!
Libertarians, of course, have no quarrel with voluntary associations and such voluntary actions as charity and boycotting. But… guilds and labor unions have tended to employ the state to impose their preferences on others; poor laws were historically and are by definition instruments of state policy; and limits on trade have historically been imposed on us by the state. There is nothing free or voluntary about them.
A few years ago in honor of Arthur C. Clarke’s then-recent birthday, I wrote on my own blog that he must never have read Ludwig von Mises and Murray Rothbard,
because according to this quote cited by Gregory Benford in his happy-birthday letter in Locus Magazine (January 2008), he claims that “there are some general laws governing scientific extrapolation, as there are not (pace Marx) in the case of politics and economics.” Well, far be it from me to disagree that Marx was wrong about a lot of things, but Clarke is wrong here. Sir Clarke, you may be 90 years old now, and happy birthday by the way, but it’s never too late to acquire a firm grasp of sound economic theory.
As disappointing as it is, it’s not surprising that he had a natural-scientistic bias against economics. Sadly, he died only a few months after my post.
In a more recent article in the Sri Lanka Guardian, more of Clarke’s economic ignorance is on display:
While researching for this article I came across a searing indictment by Clarke on the American capitalist system. After observing that the structure of American society may be unfitted for the effort that the conquest of space demands he continued, “No nation can afford to divert its ablest men into essentially non-creative and occasionally parasitic occupations such as law, insurance and banking”. He also referred to a photograph in Life Magazine showing 7,000 engineers massed behind a new model car they had produced as ‘a horrifying social document’. He was appalled by the squandering of technical manpower it represented. All this indeed makes one wonder whether he really was a closet socialist.
Gizmodo has an interesting post about How Ma Bell Shelved the Future for 60 Years. It is an excerpt from The Master Switch by Tim Wu.
Here is the money quote:
This is the essential weakness of a centralized approach to innovation: the notion that it can be a planned and systematic process, best directed by a kind of central intelligence; that it is simply of matter of assembling all the best minds and putting them to work in unison. Were it so, the future could be planned and executed in a scientific manner.
Yes, Bell Labs was great. But AT&T, as an innovator, bore a serious genetic flaw: it could not originate technologies that might, by the remotest possibility, threaten the Bell system. In the language of innovation theory, the output of the Bell Labs was practically restricted to sustaining inventions; disruptive technologies, those that might even cast a shadow of uncertainty over the business model, were simply out of the question.
Cross-posted at Prometheus Unbound.