Reclaiming Liberalism

Matt Yglesias responds to Freddie’s post on the dearth of truly left-wing voices in the blogosphere, and lists his own economic goals as a way to illustrate his own views on liberalism:

  • More redistribution of money from the top to the bottom.
  • A less paternalistic welfare state that puts more money directly in the hands of the recipients of social services.
  • Macroeconomic stabilization policy that seriously aims for full employment.
  • Curb the regulatory privileges of incumbent landowners
  • Roll back subsidies implicit in our current automobile/housing-oriented industrial policy.
  • Break the licensing cartels that deny opportunity to the unskilled.
  • Much greater equalization of opportunities in K-12 education.
  • Reduction of the rents assembled by privileged intellectual property owners.
  • Throughout the public sector, concerted reform aimed at ensuring public services are public services and not jobs programs.
  • Taxation of polluters (and resource-extractors more generally) rather than current de facto subsidization of resource extraction.

Tim Lee writes:

What’s striking about the list is that about half of them are straight-up libertarianism (less occupational licensure, fewer subsidies for suburbanism) and there’s only one item on the list (“more redistribution of money from the top to the bottom”) that Milton Friedman would have strongly opposed. One way to interpret this is to say that Matt is a moderate libertarian with a redistributionist streak, but I don’t think that’s the right way to look at it. Rather, what’s happened is that liberalism in general has internalized key libertarian critiques of earlier iterations of liberal thought, with the result that a guy with a largely Friedmanite policy agenda can plausibly call himself a liberal. And actually, this shouldn’t surprise us at all, because Friedman called himself a liberal too.

Liberalism in the 19th century focused on opposing concentrated power and entrenched privilege, whether it was monarchy, slaveholding, or protectionism. In the 20th century, the American left became infatuated with concentrating power in the hands of democratically-elected governments. The libertarian movement arose to counter this trend and defend the original, bottom-up conception of liberalism. Since the fall of communism, the left has largely (though not entirely) backed away from its 20th century infatuation with central planning. And the result is what critics call “neoliberalism”: a left-of-center ideology whose egalitarianism is balanced by a healthy skepticism of concentrated power.

Tim calls this ‘bottom-up liberalism’. You could just as well call it decentralized liberalism or grassroots liberalism. Or you might call it liberalism minus progressivism. And I think this speaks to Freddie’s complaint: certain influential factions within the left have become more and more disenchanted with traditional leftism, labor unions, central planning and so forth. Tehy retain a commitment to broad egalitarian projects, progressive taxation and so forth, but are not recognizably leftist. Classically liberal thought has made major headway in the intellectual left and in the policies of many center-left lawmakers from Bill Clinton to Bill Daley.

Yglesias writes:

Is this a “neoliberal” program? Well, this is one of these terms that was invented by its critics so I hesitate to embrace it though I recognize that the shoe fits to a considerable extent. I’d say it’s liberalism, a view recognizably derived from the thinking of JS Mill and Pigou and Keynes and Maury “Freedom Plus Groceries” Maverick and all the rest. I recognize that many people disagree with this agenda, and that many of those who disagree with it think of themselves as “to the left” of my view. But I simply deny that there are positions that are more genuinely egalitarian than my own.

Neoliberalism strikes me as a bit of an Orwellian term – “neo” is an odd appendage for a movement dedicated to returning to its own classical roots. Neoconservatism works for the neoconservative movement because its proponents do not trace their heritage back to the roots of conservatism at all. Paleoliberalism makes more sense, but is perhaps also more awkward and unwieldy. And so “libertarianism” has been the word we’ve used for decades now to refer to classical liberalism as distinct from progressive or welfare liberalism.

Some have called libertarianism an offshoot of liberalism – an “extremist cult” of sorts. I think there is some merit to this. Certainly libertarianism’s romance with the right has made it hard for libertarians and liberals to speak the same language or to work together to achieve their similar goals even. This in spite of the rise of ‘neoliberalism’ within the Democratic party and liberal intellectual circles. Not that the progressive movement made the left hospitable territory for classical liberals in the many decades following the New Deal – up until really Carter’s deregulation push and then the free-market friendly New Democrats.

The liberal-tarian project can best be understood by understanding the redundancy of its own name. Really, liberal-tarianism is about reclaiming liberalism from the far right and  from progressivism. If right-wing libertarianism is a radical offshoot of liberalism, then left-wing progressivism is similarly divorced from the roots of liberalism. It would not surprise me if social conservatives and economic populists finally ended up on one side of the equation – another uneasy alliance – while social and economic libertarians joined forces on the other. But realignments take time, and this one is not likely so much as it is possible. Politically it seems more plausible than culturally. But stranger things have happened.

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114 thoughts on “Reclaiming Liberalism

  1. Yeah, with the possible exceptions of the bit about licensing cartels and no mention of unions (not surprising, given that private sector unions haven’t really been a force during Yglesias’ adult life), I don’t see how this is all that different from the way the American center-left (liberals and progressives) has thought for at least my lifetime, and from what I can tell, pretty much forever. There doesn’t seem to be anything neo about this. (I don’t know where you see “central planning,” to the extent that phrase means planned economies, in the thinking of any viable version of the American left ever.)


  2. “Liberalism in the 19th century focused on opposing concentrated power and entrenched privilege, whether it was monarchy, slaveholding, or protectionism.” (Tim Lee)

    “…certain influential factions within the left have become more and more disenchanted with traditional leftism, labor unions, central planning and so forth.” (E.D. Kain)

    How does one oppose the things from the first quote (wage slavery/entrenched privilege/) without utilizing forces from the second (labor unions/central planning)?

    Obviously a labor union can be come entrenched privilege like any other organization, just as government can become to centralized and thus a bully all its own, despite direct representation. But is there another way to balance powerful corporate interests if not with labor interests (labor unions) or public interests (government)?

    And so if libertarianism is somewhere between the left and right (is that where you are locating it? As a halfway between radical interpretations of classical liberalism?) where does it (libertarianism) draw the boundaries between competing interests? Where does it position the balance of power between laborer, capitalist, and bureaucrat?


    • The short answer is competition. Also, decentralized regulation. I will have to get back to you with the long answer. Suffice to say centralization of the state is not a sure bet against corporate excess and abuse, and often quite the contrary.


      • Decentralized regulation is a great way to get race-to-the-bottom problems.

        The bank issuing your credit card is charted in South Dakota. The laws of South Dakota are incredibly favorable to card issuers on any number of issues, like usury for example. It is unlikely you can find an alternative.

        Many corporations incorporate in Delaware, because there’s the perception that the court system there is particularly deferential to corporate management.

        Decentralized regulation can work for goods and services which are difficult to move across state lines. But increasingly American businesses are finding more ways to do just that. (Wasn’t there a news story recently about some fast food chain centralizing its drive-thru order taking staff?)

        In general, I would expect that parties with greater economic and political clout would prevail in an environment of competitive regulation. At the federal level at least, the consumer lobby is much stronger than it is in most states.


        • “The bank issuing your credit card is charted in South Dakota. The laws of South Dakota are incredibly favorable to card issuers on any number of issues, like usury for example. It is unlikely you can find an alternative.”

          Checks? Money orders? Cash? Paypal?

          That you automatically reach for your credit card doesn’t mean that it’s the only possible way to exchange money for goods and services.

          And the orthodox Libertarian response is that if those credit-card terms were so onerous as you believe, then there’d already be companies offering more lenient terms, and they’d have plenty of customers. Maybe the “race to the bottom” you decry is actually the market of providers finding the optimum price for the service they provide.


        • Another good example of the “race to the bottom” of decentralized deregulation can be found in the various extractive industries. When one state suggests it might enact legislation embodying any of higher severance taxes, tighter environmental standards, and on, and on, the extractive industries in general and the oil and gas companies in particular threaten to take their drilling rigs and move on to the next state. Industry has been successful at this in a large number of cases. The two where they have not, at least in avoiding taxation, are those two bastions of socialism, Alaska and Wyoming. Of course, in those two cases, there is nothing comparable to Prudhoe Bay oil field in North America, nor comparable to the Powder River basin coal fields.


    • “The short answer is competition. Also, decentralized regulation.”

      So the definitive question that always seems to come up in these circumstances, is competition the natural state of things, or does it have to be artificially constructed? Even minimalist frameworks where govs enforce contracts, etc. still favor certain entities over others. And if left to their own devices, commercial entities, at least theoretically, tend toward conglomeration and monopoly (not much competition). So if the competition starts out slightly rigged in a certain direction, and is always winding down over the time frame of a given scenario to more centralized “winners,” and more decentralized “losers”, who is going to reset the competition, or try to keep it more competitive?


      • People tend to cooperate but also to compete – its clearly pretty complicated. The kind of ruthless zero sum “perfect” competition between people in the same business that would produce socially optimal outcomes in theory, does generally seem to be confined to economics textbooks. As Adam Smith pointed out, you only need to put two people in the same business in a room together and you have a conspiracy against the public. But at the same time, businesses really do compete with one another for revenue even in pretty hidebound industries (P&G versus Unilever, Ford versus GM etc). They just tend not to do so in the way economists think they should, although to be fair to economists, modern models tend to be based on monopolistic competition, in which non-price factors play a more realistic role.

        The “neo” liberal view on this is that we should create regulatory structure to prevent cooperation in areas where we want competition eg. between banks. The libertarian view is that this is a mistake, and that provided there are no property rights violations involved eg. preventing new entrants to the market, we do not need to prevent cooperation.


      • Thanks for this comment. I tried to get at this same question in another recent thread and got no response. I appreciate the way you’ve framed the question, too. Maybe someone will bite.

        I’d just like to understand the libertarian view that competition is an inevitability once government is limited. I think it is more likely that any competition would start out not only slightly rigged, but greatly rigged and the end result will be far from truly competitive. Or to Simon’s point, what is the basis of the presumption that there will be benign cooperation rather than collusion?


        • I don’t know that the argument is that it’s an inevitability.

          I think the argument is just that it’ll be a lot more likely without the barriers to entry created by a government colluding with massive corporations.

          Sure, there will always be economies of scale. Liquor Warehouse will be able to buy the 50 pallets of Corona and get that deal while Pop’s Liquor (Formerly Mom and Pop’s Liquor) will only be able to store the single pallet and they won’t have savings to pass along to the customer.

          But imagine Liquor Warehouse pushing for particular liquor selling legislation… will Pop benefit from this new law? How about the kid coming out of college with dreams of opening his own liquor store? Do you think that the kid will benefit from the new law?

          It’s not that competition is inevitable, it’s just that it’s more likely.


          • Thanks for the response. I have an easier time buying “more likely.”

            So I’m clear, I’m not arguing against more competition and for more government control. I just think the idea that having limited government will naturally bring more competition to be a gross oversimplification. There is just so much advantage cooked into the system by those in the power positions now that I don’t think it is possible to have anything near competitive balance without some leveling of that advantage. And I think government is the only way to achieve that leveling.


            • I think there is genuine concern with deregulatory capture – the power structures erected at this point are as likely to take advantage of deregulation as they are regulation. So everything must be done carefully. No easy answers.


          • Quick! Run! Business and government are colluding! The plutocrats are coming, the plutocrats are coming!

            Yes, government can collude with labor. Businesses can collude with government. Business can collude with business.

            But at least I have the right to vote.


            • “Yes, government can collude with labor. Businesses can collude with government. Business can collude with business.

              But at least I have the right to vote.”

              Heh. Democracy – the opiate of the masses.


            • Yes, that’s why the masses vote so often…

              My point is only that I have at least some semblance of power when it comes to curbing the coercive authority of the state. When it comes to commercial entities, I don’t have even that privilege.

              Of course you could tell me to vote with my pocketbook. But that is only the power to navigate a given commercial landscape, rather than the ability to affect the underlying ways in which that landscape is formed.


              • Jaybird’s point is that without government interference in the market, you would be able to vote your pocketbook.

                There’s nothing stopping M&P Liquor from saying “hey, those Liquor Warehouse guys are jerks, come to M&P liquor! We’ve got higher prices, but we make up for it with better service!” Except, that is, for government regulations regarding liquor stores. Maybe the reason that there isn’t any competition to Liquor Warehouse is that the government has made it illegal for there to be more than one liquor store in a town…

                For real-life examples of this, see Pennsylvania’s laws about beer stores. You cannot have more than one beer store in a town. So if the guy running the beer store is a total asshole, then that’s just too bad.


                  • It’s also worth noting that just because liberals are in favor of regulation as a tool, they don’t necessarily believe in every regulation the same way establishment conservatives oppose any tax increase for any reason.

                    I think you’ll find many PA (and NH, since they have a similar system) liberals who don’t like the state liquor monopoly. It’s a pity we can’t have a serious conversation about our liquor laws without MADD tugging at voters’ heartstrings.


    • I think the term “central planning” gets thrown around in a sloppy and slightly ominous manner that obscures its meaning. If we look at Soviet style central planning that meant some bureau in Moscow directing every detail up levels of consumption and production for the entire country. That is “real” central planning. There is just nothing like that even considered in the US. Then what does central planning mean other then a vague allusion to the USSR: not much. It seems a massive conflation to use the same term for a federal level regulation with Soviet command economies, they just really aren’t the same.


      • Right, but equally sloppy is the way people bandy around opposition to “free markets”. Assuming the term is actually being used correctly, if you oppose free markets you must be proposing to put something in their place, and what’s usually proposed is some kind of market skewed towards the proposers preferred outcomes. Skewing the market towards the preferred outcome necessarily involves some degree of central planning because without it outcomes cannot be controlled. Yes, there’s a long way between this and the Soviet Union, but it does still involve some Bureau in Washington deciding (for a recent example) whether debits that would put an account in deficit should be honored or denied. The bureau is not in Moscow, but there is a clear commonality, isn’t there?


          • But planned quotas and prices are rules by which market participants must abide, and as it happens they’re quite common in liberal regimes – what are agricultural subsidies if not an attempt to regulate prices and quantities?


            • That’s why you won’t find liberal economists defending them. Farm subsidies are a bipartisan disease with supporters along geographical, not ideological, lines. Yglasias isn’t a fan, for sure.


              • Sure. Politics is one thing and policy is quite another, especially the kind of policy economists tend to like. But are farm subsidies central planning? If so, was regulation Q central planning? It it was, then how are the new regulations on credit card interest rates not central planning? I don’t see a sharp, clear line.


            • “Central planning sets production quotas and prices. Liberal regulation sets rules by which market participants must abide. ”

              So central planning is a liberal regulation, but liberal regulation is not necessarily central planning.


                  • I don’t think that it’s necessarily wrong because “Central planning is a liberal regulation if company towns are like free markets.”

                    The company town (in its most pure form) is an example of central planning There is one entity that controls all property (in Pullman, they could throw you out of your home for any reason), there is one source of goods and nobody is allowed to set up shop and compete.

                    In a liberal regulation environment, property is alienable, people can start businesses where they want and charge what they please, subject to certain rules.

                    In the company town, you can’t open a competing general store. In a liberal regulation environment, you can open another general store, but you can’t mislabel ingredients, offer deceptive credit terms or dump waste into a stream willy-nilly.

                    The mistake many libertarians make is that they see liberal regulation and central planning within the same economic system and assume that one leads to the other or that a person in favor of one is in favor of the other.


                    • I see the distinction you’re trying to get at. I would put it this way: Liberal regulation tries to prevent certain outcomes that are seen as having too high an external cost. Central planning tries to mandate certain specific outcomes. I agree its usually clear which is which, but the line does get blurred – at some point you prevent so many possible outcomes there’s really only one left!


  3. It would not surprise me if social conservatives and economic populists finally ended up on one side of the equation – another uneasy alliance – while social and economic libertarians joined forces on the other. But realignments take time, and this one is not likely so much as it is possible. Politically it seems more plausible than culturally. But stranger things have happened.

    Yes, the great, probably illusionary, but intellectually and morally compelling economically socialist/culturally communitarian fusion! I’ll keep hoping.


    • FDRism, Mr. Fox? Seems to fill your bill.

      As for “reclaiming liberalism,” the question is from whom? Recent comments have placed the Democratic Party [minority leader Nancy Pelosi?] as “moderate” and the far-left as “left.” [See “No True Leftist,” E.D. Kain, January 16, 2011]

      [The GOP, of course is “extremist,” and not part of any realistic discussion of politics.]

      With no room in the center since Nancy Pelosi moved in, and the far-left taking up the “left” slot, Matthew Yglasias, come on down! You’re the new right-winger here at the LoOG FunHouse!

      I thought I spoke Liberalese, because I get the LA Times and tune in MSNBC now & then, but I realize now I’m not bilingual like I thought:

      More redistribution of money from the top to the bottom.

      OK, I get that part. That’s the part we’re supposed to pretend doesn’t exist, or else it would be a dealbreaker that Matt’s not a lefty.

      A less paternalistic welfare state that puts more money directly in the hands of the recipients of social services.

      Actually, if you’re not making it on your own, I want the gov’t to be as paternalistic as hell with you spending my tax money.

      If it’s your own money, hell yes, less paternalism. None.

      Macroeconomic stabilization policy that seriously aims for full employment.

      I have no idea what a “macroeconomic stabilization policy” would look like, or even what one is. This was where I realized I don’t speak the language. Fortunately, Google was of help. The gov’t spends more and more money and all of a sudden it rains, which rhymes with “Keynes.”

      Curb the regulatory privileges of incumbent landowners

      Aren’t all landowners “incumbent?” As opposed to erstwhile? Or future? And what are their “regulatory privileges?” Even Google doesn’t speak this Liberalese.

      Roll back subsidies implicit in our current automobile/housing-oriented industrial policy.

      I’ll guess this means no more mortgage deduction. But that deduction’s explicit. Why didn’t he just say so? The automobile part I don’t get. Mebbe writing off your mileage on your taxes. You should be taking the bus. Again, why didn’t he just say so? No writing off mortgages and mileage. Is that liberal or libertarian? Whatever. Higher taxes, yes? No?

      Break the licensing cartels that deny opportunity to the unskilled.

      OK, this one I get. The monks that build and sell coffins but are getting shut down by the funeral home lobby. Then again, there’s that poor lady who got her hair bleached off by an unskilled and unlicensed beautician.

      Much greater equalization of opportunities in K-12 education.

      Education needs to get more gooder. I’m down with that. But “equalization” means if anybody drives a Cadillac, everybody drives a Cadillac. I’m thinking that means more money, unless that means everybody must now drive a Yugo.

      Reduction of the rents assembled by privileged intellectual property owners.

      The Rent is Too Damn High Party! OK, I get this one. The anarcho-capitalist thing. Free downloads!

      Throughout the public sector, concerted reform aimed at ensuring public services are public services and not jobs programs.

      Why does everything go to jargonese and gobbledygook? This must be an attempt to quietly say bureaucrats should be civil servants instead of “special interests.” What a concept. But it would lose the Democratic Party one of its strong arms, patronage and the public sector labor unions.

      OK, the gobbledygook gets a pass here. If he said it in English, the game is up.

      Taxation of polluters (and resource-extractors more generally) rather than current de facto subsidization of resource extraction.

      We extremists on the erstwhile “right” [now filed in the “extremist” file] LOVE polluters. That they create wealth and provide jobs is secondary; we dig poisoning the environment and there seems too much oxygen in the air these days. We need more CO2, a known pollutant.

      Who needs “resource extraction?” It sounds bad.

      I’ll take this opportunity to agree with Chris here, which gets us to a shocking twice in one day. Nothing new here from Yglasias, just a shift in the labeling.

      If this is libertarianism, I want my money back.


      • I’m not sure anyone is “writing the GOP out” of anything, Tom. How about this – what are your economic goals?

        Question number two: How can you have a government and not have redistribution at the same time? Even a flat tax is redistributive.


        • Thx for asking, Erik.

          But you framed this discussion entirely without the GOP, and there I think it should be considered and discussed. I do think Yglasias’ manifesto is an exercise in sophism, not a defense of “liberaltarianism” or anything resembling libertarianism, for reasons given, line-by-line.

          If it helps, I’m not dodging and am not shy about making my thoughts known at the proper time. And although I’m an unapologetic gentleman of the right, I have a sympathy for FDRism. My mom loved him, and I loved her.

          And she won a few of our arguments, dontchaknow. ;-)


          • Tom – I disagree with Yglesias on a number of things; I think I would fall quite a bit to the right of him on most issues. I think redistribution is inevitable when a society decides to have a government that they’d like to keep – even a flat tax would be redistributive. Regressive tax systems can function alongside progressive ones, but not on their own. At least not in the modern age.

            But whatever the flaws of his argument, Yglesias is still illustrative of the libertarian influences on the left and of the various convergences of leftist, progressive, and more classically liberal ideas. The latter, I would argue, comes out pretty strong in his thinking, even if he does place way too much faith in the ability of the state to achieve its manifold other ends.


            • I understood your argument, Erik. “Redistribution” is a fact of political life, if not simply real economic life—in Communist China, Imperial Rome, even the feudal system and “noblesse oblige.”

              Even in America, even before FDR. Adam Smith, that the rich would pay a “carriage tax” and the poor would use the roads for free. Somebody’s got to have some money before you can tax ’em out of it.

              Matthew Yglasias, feh. Class warfare all the way, brilliant ideas on how to spend somebody else’s money. The world is lousy with such folk, and they ain’t libertarians.

              The day he stands up against the Obama Administration’s silly, stupid and ideological bureaucratic delay tactic of opening up offshore drilling again—and the jobs it’ll create—I’ll move Yglasias to center-left, a Bill Clinton DLC [pro-business] Democrat.

              Yglasias is still back at “polluters” as the villains, demagoguing away. I understand you wanting to give him credit for something, but it’s all just talk, and foggy talk at that. Yglasias was just defending his left flank from Freddie to appear “moderate” and make a claim to the center.

              Well done, Freddie. It took a far-leftist to show Yglasias for what he is, still a gentleman of the left. [Not that that makes him a bad person, mind you. But a libertarian? Pish-posh.]


        • I don’t think that Koz is arguing against redistribution, even in theory.

          I think that he’s arguing against non-Paternalistic redistribution.

          Something to the effect of “if you don’t want to be told how to live your life, use your own money”.

          We see this with people wanting food stamps used only for “healthy” food… and welfare checks going towards rent, food, and school supplies rather than marijuana. I dunno whether we’ll see similar attitudes toward public health care but it’s probably the way I’d bet.

          I’ve gotta say, I see the appeal in saying “if you’re using my money, I’m going to have a say in how you spend it”. (And I can hear the counter “argument” now… “so does that mean that I can make the government stop spending money on war?”… so I respond “wouldn’t you like that to be an option?”)


      • FDRism, Mr. Fox? Seems to fill your bill.

        I would delight in another FDR, Tom. The New Deal, despite its shortcomings (and it had many) was nonetheless truly about empowering the non-rich to act against the rich–striving, that is, for an equality not measured primarily in individual income, but in class, community and social power. Ultimately the New Deal gave us the welfare state, but many more of its roots were grounded in populist, progressive, and social justice thought than the usual history tells us.


        • Thx, Mr. Fox. We agree on the value of FDRism, although not on your justifications [perhaps even his]: class warfare.

          I do not believe in “social justice”; I find the idea unworkable if not absurd. I do believe in charity, and I would argue that’s what vitiated FDRism in America, specifically “Christian charity,” as they used to call it before they called it the “social gospel” until they finally bled Christ and the gospel out of it and called it “social justice.”

          I suspect the invocation of “Christian” might poison the well for the modern man, but I am just giving an historical account of how we got here. So let me take a step back: To this [compassionate] gentleman of the right, the question is never if the rich have too much, only that the poor have enough.

          Charity, not justice. We should not mistake them for each other. I think even a libertarian—especially a “compassionate” one—can appreciate the distinction.

          “Compassionate” libertarian? Well, I wish you luck with that, Erik. That riff din’t work so well for Dubya, but I think that’s just what you are, sorry. ;-} You poor bastard.


          • Tom, if I am a libertarian than yes, I am probably a ‘compassionate libertarian’ just like I would likely be a compassionate conservative or a compassionate anarcho-capitalist. I am a softy. I can’t help it. But that is rather informed by my religious beliefs, and my conviction that a stable society is important and cannot be achieved without some social assistance for the poor vis-a-vis the state.


              • Actually, I think I am essentially more of a squishy sort of Burkean conservative who has come to libertarianism via a long series of concessions to my own doubt. Or, rather, I think libertarianism – decentralization, federalism, free markets and so forth – is the best way to implement a more autonomous, stable society at least in a country with few traditions of its own.


            • “But that is rather informed by my religious beliefs, and my conviction that a stable society is important and cannot be achieved without some social assistance for the poor vis-a-vis the state.”

              There was a subtle shift in liberalism that occurred in the 80s without a whole lot of public comment, that the practical effect of the welfare state was to maintain programs to benefit the middle class, not the poor.

              If public assistance was limited to the poor the government would be a lot smaller and we wouldn’t be in as much trouble today.


      • The “incumbent landowners” bit is about restrictive zoning laws and the power of local boards to block liquor licenses and such. Yglesias spends a lot of time on that on his blog because it’s especially bad in DC.

        “The automobile part I don’t get.” Well, we spend billions on highway construction and other infrastructure, often at the behest of developers who want a wider road to the next patch of farmland they want to turn into suburbs/exurbs. In the past, developers paid for their own sewage and even ran their own trains out to developments. In addition, our gas tax is among the lowest in the developed world. Is increasing it libertarian? Not really, unless you consider it pricing externalities.

        Your reply to “taxation of polluters” schtick is just a bunch of sarcasm. Just because Liberal A believes something doesn’t mean that he thinks Conservative B believes the exact opposite.


  4. There is a difference between libertarianism that sees the income tax rates as the only measure of freedom and the libertarianism that cares about freedom.

    For those in the former camp, the title is nothing more than a way to appear a little more well-read and to fit in a few heterodox positions (drug legalization, gay rights) within the old conservative model. No wonder this is where nearly of the criticism of fusionism comes from, with inflexible randian ideologues doing the rest.

    I consider myself mildly libertarian, but I end up voting Dem most of the time because I believe there are more important freedoms than the freedom to keep 3% more of my income.

    That being said, there is a lot of daylight between Yglesias and the Dems on things like licensing and zoning. At least with the two-party system, nobody gets what they want.


  5. This is probably the only thing I’ve ever read that attempts to explain the difference between neo-liberals and liberaltarians. I always got the feeling that neo-liberals were vocally pro-capitalism because it was like a compromise with “bad” money and “dirty” business – not something any of them actually really liked or considered a good thing which helped people.

    The few liberaltarians out there, never gave off that impression to me. And Matt doesn’t give off that impression either.


  6. On an elementary, you can see how this position – and you and Lee and Yglesias are hardly the only one expressing it- is that, from a certain perspective, it isn’t really a critique of my complaint but rather an acceptance of its premise and then an assertion that this is a good thing. Which isn’t out of bounds, of course, but you see my perspective.


    • Freddie, I think that’s exactly right. I think I mentioned as much, at least in passing, in the post itself. No, I’m basically with you on your premise. There is no serious left-wing contingent in the bloggysphere. And I do tend to think that this is a fine thing if it’s occurring organically; if there were some systematic attempt to write that voice out of the debate, I wouldn’t want that – but I think there are just truly not very many leftist voices on the internet in America right now.


  7. MattY’s list of goals was very helpful in making clear what his priorities are. Much more so than any of the labels being bandied about here.

    Everyone should have a list of their own handy when asked to self-describe. It would save a lot of time and effort.


    • You’re right, and I think it speaks to a real problem: the trap that a lot of libertarians get into (Reason magazine, I’m looking at you): pointing at a dumb regulation and saying that anyone who supports any regulation at all wants that particular dumb law on the books or that it must follow that one leads to the other.


  8. I generally agree with all of this of course – the commonalities between mainstream liberalism and libertarianism tend to get lost and I find this frustrating because those commonalities include my most important political commitments.

    But its important that there are still big differences – neo-liberals remain committed to a view of the state as useful and only as malevolent as the people holding office. Libertarians largely see state action beyond the minarchist ideal of protecting pre-established rights as being an unnecessary evil. The tracks are converging – liberals are becoming more aware of the perils of using the state to solve problems, and more and more libertarians seem to be arguing against government action on the merits, rather than from first principles that always put the state in the wrong by definition, but there’s still a long way to go.

    Although neo-liberalism and libertarianism both stem from a common liberal root, they’re both somewhat contaminated with illiberal ideas at this point. Although Socialism never had any real foothold in the US, the Democratic party took on at least part of the role Democratic Socialist parties played elsewhere in the world, and Socialist ideas were assimilated into an otherwise generally liberal political coalition. Its difficult to understand the Democrats affiliation with the labor movement or their commitment to tough regulation of business any other way.

    Similarly, although the bulk of libertarianism is just classical liberalism, there’s a fair chunk of Egoism in there too, which came down to us from Max Stirner via Benjamin Tucker, Ayn Rand and Murray Rothbard. That more radical strand doesn’t consider rights to be fundamental and wants nothing to do with utilitarianism and confines itself to talking about what the unfettered, rational individual would and would not consent to.


    • You might be muddying the issue a little bit. There may be important differences between Yglesias and Freddie but there isn’t an ounce of libertarianism in either one.

      Observations of blogosphere representation aside, there substance of Freddie’s complaint is silly. We can favor this or that, but the problem with radical Left economics is that it can’t deliver on anything and it’s all been tried before. Therefore anyone who claims to favor it has a lot of spadework ahead of them to get any credibility. That’s a much bigger issue than temporary blog-culture alignments.

      The gap between Left-libertarianism and mainstream liberalism is different. Personally I think it has to do with libertarians selling their principles for SWPL class solidarity more than any theory of the state.


  9. Could it be that libertarians and modern liberals are people who agree on positive issues and disagree on normative ones? Both libertarians and modern liberals have absorbed Hayek, Friedman, etc. But whereas libertarians value negative rights and wealth-maximization, liberals tend more to value positive rights [cf. health care], and tend to temper their valuing wealth-maximization by also valuing distributional equity [cf. Rawls].


  10. That list seems a little disingenuous and idiosyncratic to me. I’m sure he thinks he wants to reform public sector employment, but given his tangles with Kaus over unionism and what I recall from him during the stimulus, he means this in a particular around-the-margins way.

    And the same with licensing cartels. Whatever might be said about that, I don’t believe anybody associated with the Left, including Yglesias, cares about that anywhere in same neighborhood as redistribution. And if you believe in redistribution, what difference does it make what you think about licensing cartels.


  11. I have to take issue with one of Time Lee’s points. There are two of those propositions that Friedman would have objected to, the second being creating full employment through stabilisation policy. In fact Friedman won his Nobel for proving that you can’t do this. If you try you get the 1970s.


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  13. I think the way you’re categorizing this is very good and I don’t really have much to say about where Yglesias’s list should go. But, I’ve got to say, my first gut response to those objectives was that they’re some pretty wimpy solutions to pretty serious problems. I don’t know if that agrees with what Freddie’s saying or not.


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  15. I feel like I should have more to say about this than I do. Yes the Democrats (once you scrape the graft and naked political interest of day to day politics off) are much closer to neoliberal or moderate liberal in principal than they are to any of the old leftist/communist shibboleths that the right has been slinging. They’ve been that way my entire political lifetime but then again I was going into my teens as Bill was going into the presidency so go figure. It just seems a bit no-duh to discover this.

    I mean is Obama a communist? No, of course not; or if he is he’s really bad at it because had he been a real closet commy or socialist he’d have nationalized the banks for instance and with the sentiment at the time much of the country would have applauded it (at first at least).


    • I’ve been surprised how much the closet commie bit keeps coming up. He ran on healthcare reform, letting the Bush tax cuts expire and voted for TARP along with a bunch of Republicans. Bush started bailing out Detroit and it was Obama who is selling off the government’s shares in GM. Look at his platform for chrissakes.

      The socialist/commie line is a result of the “America is a center-right country” schtick that gets repeated at every election, no matter the result. It serves to impart a false conciousness on a majority that votes left of center.

      It may be boring if you’re an ideologue looking for a scary domestic enemy, but “they are who we thought they were.”


      • the closet commie stuff is a holdover from the Red baiting years of the Repub party. Along with that people have overused so many words like socialism or communism, etc so much that they no longer have much meaning at all. When called on this most people either can’t define these words or use such ridiculously wide definitions they don’t make any sense. Communism or socialism, nowadays, is any gov. a person doesn’t like.


      • Where would you put the centre exactly? I mean, I’d say that America is a centre right country, but the Democrats are its natural party of government, and draw the obvious conclusions that the Democrats are a centre right party, which in international terms they are.


        • Perhaps compared to countries with similar income levels, we are center-right. However, when you hear the term coming from pundits, it implies hawkishness regardless of context, aversion to taxes and regulations (without any distinction as to which taxes and regulations) and a mild form of social conservatism.

          It doesn’t say much about what Americans are for, just what they’re assumed to be against: whatever Democrats ran on, even if they win.


        • Personally I don’t think any kind of accurate right left spectrum could be applied internationally. Every country has its own variation. A centrist Canadian for instance would be a wacky left politician if transplanted to the US without changing any policy positions at all.


          • I agree there’s no consistent left/right policy spectrum – everyone’s politics are necessarily relative to their own status quo, and while there are common aspects to the status quo, there are also huge differences. But I do think left- and right-wing attitudes are fairly invariant – the right is suspicious of social change, supportive of individual effort, and generally nationalistic. The left is suspicious of private greed and differences in outcomes, supportive of efforts to help the disadvantaged of any kind, and generally internationalist.

            There are left- and right-wing individuals in all countries, of course. I think its actually something pretty fundamental in human psychology that creates this almost-universal difference in temperament. But there’s also the general cultural atmosphere. The zeitgeist or whatever. The assumptions people bring to the table when they start talking about politics. And I do think that in the US those are noticably more right-wing – suspicious of social change, supportive of individual enterprise, and pretty nationalistic.


          • I agree, New Zealand’s left-right spectrum and the US’s are practically orthogonal. And there are temporal changes as well. It’s one of the reasons why trying to place fascism or communism on a political scale are pretty much pointless.


    • I should also say that most American socialists, when such people actually existed, were militantly, vehemently anti-communist. This just accentuated the social democrat/liberal confusion that persists in American politics to this day. Most of those people, of course, went on to become neo-cons. Go figure.


  16. In the updates, Freddie has actually explained everything about why MattY is MattY, why Freddie is Freddie, and why one guy is blogging for a living and why another guy quit and only came back intermittently… there are entire universes in this one paragraph in this update:

    This, actually, is untrue. It’s worth saying that I once had the opportunity, not too long ago, to blog for money– not a lot of money– for a fairly mainstream progressive enterprise. I turned it down for a variety of reasons, not the least of which is my continuing fear that my blogging will come back to ruin my career in the academy, as it may even without professionalization.


    • When I started blogging, I heard plenty of academics say that doing any blogging whatsoever will kill your chances of getting a tenure-track position because it’s seen as unserious in the academy. I don’t know if things have changed since then, but I will say that I’ve never let my colleagues know about my canon project and have no intention to do so. Also, I’d note that nearly all of my favorite academic bloggers are people who already had tenure when they started blogging.


      • > Also, I’d note that nearly all of my favorite academic
        > bloggers are people who already had tenure when
        > they started blogging.

        Most of the tenure-track faculty I know who aren’t tenured yet don’t have the time to blog anyway, they’re too busy trying to get publications so that they can get tenure ;)


  17. More redistribution of money from the top to the bottom.

    There are some readers here who know Matt Y much better than I, but this seems inaccurate. Or, at least, inconsistent with anything he has ever supported in practice.

    As a general matter, American progressives support our existing taxation scheme with a central component of same being that the income tax is the primary revenue generating vehicle for the Feds. Progressives may prefer different levels of taxation (more on the “rich” of course) but a call to get away from the income tax is a rare sound indeed. However, the income tax is the absolute worst method of “redistribution” one could come up with. As a threshold matter, it completely forecloses redistributing anything that was earned, received or accumulated at any time other than the last calendar year. Thereby insuring that the “wealth” you were born into, stays well out of the redistributors hands. Moreover, labor income is the principal means of support for the vast majority of working class people- the same people who should be receiving the redistribution. But such is largely impossible if the vehicle for redistributing only strikes at the working man’s wages and leaves all of the income largely undisturbed, or disturbed at very low levels. Certainly not disturbed sufficiently to allow for any serious redistribution.

    I apologize for not being able to better articulate the argument at this point, but, broadly speaking- and this general concern isn’t necessarily Matt Y related- the progressive preference for the income tax at its current levels is simply incompatible, to my mind, with the stated claims of most progressives in terms of wealth redistribution in that you can’t redistribute wealth if you only (or primarily) tax income. The two things are not the same and are, typically, rather poorly related. Is there any discussion in the progressive world that deals with this or am I missing something?


    • You’re right. However, I think it’s worth noting that the focus on the income tax is a function of political obstacles pro-progressive taxation people face.

      The inheritence tax has been demagogued to death and most people have no idea how few people pay it. The (regressive) payroll tax is split off from the income tax because of the way we structure our budget, though in the end, every dollar is fungible, no matter the source. As a result, most people who don’t “top out” think it’s more or less flat.

      The capital gains tax, however, is the real beast. Why redistributionists don’t go after that, I have no idea.


      • One reason, RJ, is that due to the existance of the corporate income tax any tax on capital gains is objectively double taxation so the politics, merits and incentives are horribly gummed up on the subject.


        • Well, corporate taxation can always be portrayed as double taxation, as people who get paid by corporations are themselves taxed.* However, nobody has successfully explained to me why double taxation is such a horrible thing, assuming we understand it for what it is.

          I buy a pair of shoes, they’re inevitably imported, which means I paid a tariff and a sales tax – that’s two taxes and if the end price is right, I’ll still buy them despite the horrible injustice illegedly done to me. Really ambitious anti-taxers will tell me that I’m also paying taxes levied on the shoe store, the salesman and the manufacturer. It’s an argument that goes on forever.

          * Besides, while the U.S. corporate tax rate is above average, the real rate is far, far lower.


          • I’ll set aside that in most of our free trade systems your shoes probably haven’t paid any tarrifs.
            The double taxation of businesses and corporations is especially problematic because it can be (and is) argued that this particular double taxation directly impacts employment rates and wages. Also it’s generally frowned on by the public to charge two taxes on the same thing. Yes when you buy something you may pay a city sales tax and a state sales tax but it’s understood that these are two seperate entities both taking a bite of the transaction.
            When a corporation earns money it is, in essence, the shareholders (the owners) who earn money. So when the corporation pays corporate income tax it’s paid money for its income. When companies realize income their share values change based on the perceived current value of the company and the expected present value of its’ income stream. So when a company turns a profit its share value increases. It’s paid its corporate income tax already but now its shareholders have to pay a tax again (capital gains) on the increased value. It’s unfair and worse it discourages companies from forming, earning profits and creating jobs. This is recognized by economists, voters and politicians who try very inefficiently to compensate for it which is why capital gains are only taxed at a 50% rate.

            Personally the more efficient and sensible liberal course would be to do away with the corporate income tax rate entirely and dispose of the 50% exemption for capital gains. Not only would the money be taxed only once and at exactly the rate everyone felt was fair but we’d also close the loophole through which hedge fund managers get away with paying much lower taxes and get the IRS out of the business of constantly playing cat & mouse with corporations on questions as to what counts as taxable income or not. The distortions that the corporate income tax creates cause enormous damage and we’d be well off rid of them.


              • Hmm RJ well you learn something new every day. Thanks.

                I agree that lobbyists and inventive corporate tax structuring consultants are excellent reasons to move the taxation collection from a corporate tax to a capital gains tax or, my own preference, a value added tax. Though with a VAT some sort of offsetting mechanism would need to be added to deal with the regressive nature of it.


            • When a corporation earns money it is, in essence, the shareholders (the owners) who earn money.

              ouch. This is just wrong. A corporation is a separate legal entity. The distribution of corporate profits to shareholders as dividends is as much a taxable event as is the distribution of corporate profits (not really the correct term) to employees as salary.

              Eliminating the corporate tax would just lead to everyone forming corporations. Tax avoidance at a personal level would skyrocket. And eliminating taxes on dividends would lead to corporate employers selling certain classes of shares to their employees for a nominal price and compensating them by issuing dividend checks every two weeks.

              Once a government creates the corporate form, complicated tax rules inevitably follow.


              • If shareholders don’t own the company Francis then who does?
                Employees do not get distributed profits as salaries. You can be sure they expect to be paid regardless of whether their company turned a profit in any given year. Also (while my tax accounting is a bit rusty) I do not believe that a dividend payment in itself is a taxable event. Shareholders typically pay tax on the difference in value of their stock between one tax year and the next along with the value of dividends. If the company doesn’t pay out dividends then the share holders will end up simply paying taxes on a greater increase in share value instead.
                While amusing the idea that eliminating the corporate tax would cause people to form personal corporations to avoid taxes strikes me as nonsense on stilts. If I formed North inc I’d have to do a bunch of paperwork and still end up paying the same (or more! As the sole owner of North Inc I’d probably have to pay into all kinds of workers comp and the like fees for my employee) taxes and quite possibly get tax evasion charges on top of it.
                Complex tax rules are not tied to the existence of corporations. Complex corporate tax rules are a result of the government levying a tax on corporate income and thus being required to specifically define what constitutes corporate income.


              • Once a government creates the corporate form, complicated tax rules inevitably follow.

                Personally, this is why I think that only corporations ought to be taxed directly. In exchange for the legal protections, you get to be taxed.

                Add a VAT on that and you’ve got a tax scheme that respects privacy.


                • The problem with taxing corporations directly Jaybird is that you get into all kinds of obnoxious definition questions. Turns out that you can play with “corporate income” a lot without even once being guilty of fraud. So in order to deal with it the IRS has to wade into the definitions and rules and what you can claim as expenses and what you can’t and how much and how long… it’s a nightmare and highly distortionary.


    • There’s a lot to be said for this, unfortunately for the Left there isn’t very much to be done about it.

      First of all, net worth is property and is constitutionally immune from confiscation. In general, capital leaves places where it isn’t secure.


      • Koz quite gets it here. This is capitalism, libertariansm, liberty in a nutshell. In the olden days—pre-capitalism—and even thereafter, it was real estate that wasn’t fungible into mere money. Primogeniture in Britain, that the first-born son inherited, was not subject to market forces.

        When real estate became fungible—just another commodity—man became truly free: liberated from the land, his station in society, and from politics itself. New Money became indistinguishable from Old.



    • Great comment, and great discussion following the comment. Learned a lot (of information whose veracity seems not entirely uncontested, but hey, what information’s veracity isn’t somewhat contested?). Thanks to the commenters.


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