Here’s something that’s always puzzled me a bit about libertarian thought: Over at Hit and Run, Jesse Walker links an appraisal of the Greenspan legacy by libertarian Baltimore Sun columnist Jay Hancock, who writes:
But I do know that central economic planners tend to mess up. I know that economies are like ecological systems: Intervention that seems to generate great results at first often comes back and bites you on the behind. The unintended consequences of the Greenspan years should be interesting.
What’s interesting here is that leftish greens who’re well attuned to the potential damage that can be wrought in complex environmental systems by benign-seeming interventions don’t appear to have anything like the same sensitivity when it comes to economic systems, and Hayek-quoting free-marketeers who understand the dangers of trying to “tweak” markets seem typically quite unconcerned about the parallel threat of “unintended consequences” in mucking about with ecological spontaneous orders. Is this just a form of blinkered partisanship, or is there some sound reason for thinking that one type of system is less succeptible to negative “unintended consequences”?
12 responses so far ↓
1 Matt Tievsky // Jan 30, 2006 at 6:01 pm
I’ve wondered the same thing myself.
I’ve come up with one possible answer in defense of Hayek-quoting free-marketeers such as myself: The market is composed of individual actors who are each approximately as intelligent as the central planner (and possess the advantage of localized information). I.e., as Hayek said, in the choice between capitalism and socialism, it’s not so much about “will there be planning,” but “who will do it.”
Nature doesn’t plan, though. So, arguably there’s less reason for humility in attempts to plan nature rather than a market.
2 T: Porter // Jan 30, 2006 at 6:14 pm
Matt T – Maybe “Nature” doesn’t plan, but neither does the market. Then you drill-down to market “actors” but don’t do the same for nature. Don’t organisms plan?
Oooh, I see Blake. I get it! Not even a humanities guy!
3 Matt Tievsky // Jan 30, 2006 at 6:48 pm
T. Porter,
I should have been clearer about what I meant when I said “nature doesn’t plan.” I meant to refer to all its constituents. I suppose in some sense most life forms do plan, but not in any way comparable to the complexity of human planning.
4 Matt Tievsky // Jan 30, 2006 at 6:50 pm
Oh, on a related note–even to the extent that organisms plan, they do so in their own self-interest. But most of us are willing to sacrifice the interests of non-humans for humans’.
5 Scott McC // Jan 31, 2006 at 7:38 pm
Good point, Julian. Another aspect of this phenomenon would be those of a certain ideological position strong belief that complexity is a good thing in natural systems (i.e. biodiversity increases the stability of an ecosystem) yet are suspicious of it in economic systems (i.e. globalization is perilously tying us all together and we should strive for “self-sufficiency”). To put a positive spin on the blinders that both groups are wearing, it might provide a way to open their eyes to new ideas, using lessons from their own deeply-held beliefs.
6 M1EK // Feb 1, 2006 at 2:55 pm
I wish more environmentalists understood that the market is a great tool which can be (ab)used for good or evil, instead of an unquestionably evil thing. That said, at least those environmentalists are being HONEST about what they want to do. Half the ‘don’t mess with the market’ folks are just covering up a desire to benefit financially (personally) from polluting.
My course is usually to point out that what we think is a free market today usually isn’t – due to externalities, and subsidies for the status quo (like paying for drivers’ facilities through property and sales taxes, for instance).
7 Jack // Feb 1, 2006 at 11:26 pm
Messing with the market and messing with an ecosystem aren’t even remotely the same thing. The market relies on maintaining consumer confidence, now that printed paper money isn’t really backed by actual assets. Ecology doesn’t allow for cooking the books. It is physics.
If you use all of a resource that isn’t easily renewable, like petroleum, you get diminished returns. If you pollute groundwater, emit carbon, chop down mature (extremely efficient) old growth, you get diminished returns. Likewise if you practice sound ecological sustainability, you will minimize the potential for imbalanced exploitation of resources. Development patterns in first and third world alike that favor land speculation and the right of industrial capital to externalize ecological cost are quite simply incompatible with what is known as environmentalism or ecology.
so Ã? final: the market is less akin to ‘gaia’ than to a giant invisible hand
8 Julian Elson // Feb 2, 2006 at 10:05 pm
At a first glance, there does seem to be a certain resonance between the two ideas, but what concrete bundle of policies would an environmentalist/libertarian propose? I’m having a tough time envisioning it. I’m seeing either consensus, standard environmental-econ measures to internalize externalities (Pigouvian taxes, cap-and-trade measures, etc) which are generally fine policies, but usually don’t protect the environment enough to satisfy real environmentalists and are too interventionist for libertarians (and the more they protect the environment, the less libertarian they are, and vice versa: this is a possibility, but it would be a compromise between libertarianism and environmentalism, not a synergistic relationship between them), or something too far out to really be appealing to environmentalists or libertarians (like, for instance, privatizing the atmosphere, or endowing non-human animals in given ecosystems with collective property rights, being owed compensation if they are evicted for any reason, or requiring individual, fully consensual Coasian contracts between every polluter and anyone effected by the pollution).
9 J. Goard // Feb 5, 2006 at 3:46 pm
Julian,
For me, one big question would be: on what basis ought we rule out politics (or personal force/fraud, for that matter) when considering human social interaction as a system akin to the larger system of life on Earth? Nobody (I think) would try to analyze separately those aspects of an ecosystem excluding animal predation, deceptive mating signals, nest-stealing, and the like — so why should we doubt that the stability and power of the most vibrant human societies has as inevitable components a certain (organically constrained) level of murder, rape, robbery, and political manipulation of markets?
10 J. Goard // Feb 5, 2006 at 3:52 pm
Oh, and I do have something in mind analogous to “artificial” changes in the environment caused by human interference. The everyday “special interest” politics doesn’t quite fit the bill, though; much more analogous would be utopianisms bent on radically transforming society according to a rational plan. And that, I am very much opposed to in a manner that seems strikingly parallel to many environmentalist arguments.
11 Anonymous // Feb 19, 2006 at 3:52 pm
Its all a matter of accepting the risk.
12 Chad Horne // Feb 20, 2006 at 4:32 pm
Hi Julian,
I don’t know if you’re the same Julian I remember from my Cafe-Philo days at Vandy, or if you’re someone else entirely; either way, I wandered over to your blog from Jacob’s blog.
I thought I’d venture an answer to your question. What libertarians and radical ecologists have in common is that both hold the (in my opinion ridiculous) view that whatever the ‘natural’ outcome of a process is, is good.
Of course, if left to their own devices, markets tend toward an efficient outcome. Likewise, if left alone, ecological systems tend toward diversity. But there is no more reason to think that efficiency is the only human value than there is to think that diversity is the only natural value.
Of course, interfering in markets will always produce less-than-optimal outcomes, when measured by the standard of markets. That’s why we interfere in the first place. But the standard of markets is not the only recognizable human standard; to me, it’s not clear that it’s a human standard at all.
I don’t think anyone could give a plausible defense of libertarianism without recognizing this. Markets are not self-justifying. You have to introduce other (moral) values like freedom and equality in order to explain what’s good about markets, what’s good about libertarianism, in the first place. And those values are going to place constraints on how far the free operation of markets can be allowed.
From the other side, it’s not obvious what’s so great about bio-diversity, either. Or, for that matter, how you can make a principled distinction between what “nature” does and what “humans” do to screw things up. (Aren’t humans part of nature?). So to defend radical ecology, too, you have to rely on other values.
So what the two views have in common is this: insofar as they both assume that whatever is, is good, they’re both equally dogmatic.