The late historian of Europe, Tony Judt, warns advocates for freer markets against adopting the same kind of ideologically-driven blinders some left-leaning intellectuals adopted during the time of Stalin. Neoliberals, and those of us to whom the label can plausibly be applied, need to take his warning to heart1:
“[T]he market”–like “dialectical materialism”–is just an abstraction: at once ultra-rational (its argument trumps all) and the acme of unreason (it is not open to question). It has its true believers–mediocre thinkers by contrast with the founding fathers, but influential withal; its fellow travelers–who may privately doubt the claims of the dogma but see no alternative to preaching it; and its victims, many of whom in the US especially have dutifully swallowed their pill and proudly proclaim the virtues of a doctrine whose benefits they will never see.
We know perfectly well that untrammeled faith in unregulated markets kills: the rigid appplication of what was until recently the “Washington consensus” in vulnerable developing countries–with its emphasis on tight fiscal policy, privatization, low tariffs, and deregulation–has destroyed millions of livelihoods. Meanwhile the stringent “commercial terms” on which vital pharmaceuticals are made available has dramatically reduced life expectancy in many places.
…[T]here is nothing innocent about Western (and Eastern) commentators’ voluntary servitude before the new pan-orthodoxy. Many of them…know better but prefer not to raise not to raise their heads above the parapet. In this sense at least, they have something truly in common with the intellectuals of the Communist age.
There is much to criticize in Judt’s statements. I have a hard time finding many people who hold even a trammeled faith in completely unregulated markets. Many, maybe almost all, of those accused of “market anarchy” concede the necessity of laws to protect against fraud and courts to adjudicate disputes and enforce contracts and concede the necessity of provision for the less fortunate. And while the benefits of a market economy are sometimes distributed so unevenly as to call its fairness into question, it’s probably not true that supporters of freer markets “will never see” those benefits: prices generally go down, even on necessities, and within a span of years rather than decades, and even pharmaceutical patents eventually expire.
And yet Judt is on to something. One of the many, many problems with those leftist intellectuals who supported Stalin or gainsaid his atrocities seems to have been their choice to regret the bad things done, but say they were caused by capitalism or say they were necessary to bringing about pure socialism (where “socialism” = “good”). They seem to have operated on the belief that only one thing counted–using centralized planning to advance socialism, even if that meant overriding individual autonomy and civil society. They believed in “the one best way” and no other.
All policy preferences involve tradeoffs, alike for the neoliberal and the social democrat, two categories that in my opinion need not be mutually exclusive. And the fact of tradeoffs is not, I believe, what Judt is complaining about. Perhaps he’s more concerned about seeing value only in material plenty, in lower prices, and in the type of choices that markets are best at cultivating. Plenty, low prices, and market-style choices are good things in their own way. But we can’t live on those “objective” truths alone.
And when plenty is distributed unevenly, or prices don’t go down, or people have to choose between least bad options instead of most preferable options, it’s too easy to blame the obstacles that impede the market, similar to how Marxist-Leninists-Stalinists blamed “imperialist” aggression or “rootless cosmopolitans” or Kulaks for their own decisions. I can insist that patent protection is a government grant of monopoly and therefore not an example of freer markets, but I’ll thereby ignore that freer markets require some starting rules and protections and the argument for patents rests in notions of legally enforceable right to intellectual property on which freer markets presumably depend. It’s all part of the cake.
I do believe my faith in markets is more tempered than what Judt criticizes. But that only moves the needle and doesn’t obviate the underlying problem. I generally prefer “the policy that creates more jobs, but bad ones, over the policy that leads to fewer jobs, but good ones.” And while I don’t believe I’m the dogmatist that that preference makes me out to be–and while I get prickly when people focus on the three paragraphs explaining that preference and ignore the four paragraphs and two blog posts outlining its exceptions and weaknesses–I’ve said what I said and haven’t retracted it. And maybe I on some level “doubt the claims of the dogma but see no alternative to preaching it.”