British Politics Guide

[Ares Land]

Also Macron

Nah. For all his love of big business, Macron is nowhere near being a libertarian!
(His platform wasn't terribly revolutionary; as for its presidency, it's been pretty boring old conservatism so far.)

[Raphael]

Haven't you had them for a while? Like, say, Frédéric Bastiat?

I'm not sure Bastiat counts as a libertarian. He was way too sensible for that

Wasn't he in favour of letting every property owner decide for himself which government should govern his property, or something like that? Sounds like a fairly far-reaching form of libertarianism to me.

Edit: I might confuse him with someone else on that point.

Besides, as far as I know, he's been pretty much forgotten as a statesman; also, his works date to the 19th century -- an entirely different country

Hey, you still have a fair number of Marxists...

[Ares Land]

Wasn't he in favour of letting every property owner decide for himself which government should govern his property, or something like that? Sounds like a fairly far-reaching form of libertarianism to me.

Edit: I might confuse him with someone else on that point.

I haven't read all of Bastiat, so maybe I missed something. But that doesn't really fit with what I read (as far as I can tell, Bastiat's hobbyhorses were socialism - which he hated - and free-trade - he was for it, of course); I don't recall any particular comments on the political institutions, except admiration for the US constitution, entirely in character for progressive French politicians of the time.

[Salmoneus]

It should be noted that Milton Friedman wasn't a true libertarian either. He was a neoliberal on consequentialist grounds: he believed that laissez faire economics was empirically the best way to improve everyone's lives. Accordingly, he supported redistributive taxation to support the poor, government funding of education (funded by taxation), government provision of some public services (funded by taxation), and government interference in monetary supply, and he actively assisted the treasury in increasing taxation in wartime because it was 'necessary'. His objections to what he saw as excessive government interference were therefore pragmatic, not essential commitments.

A true libertarian in the ideological sense is not just someone who promotes lower taxes, but someone who believes that when something is genuinely a person's property, that person has almost unlimited rights over that property, and society has little or no right to interfere in their enjoyment of that property, or, crucially, to take property away from its owner. Coercive taxation in all but the most extreme circumstances - or at least coercive taxation for any purposes other than the necessary protection of the basic liberties of the individual taxed, is therefore for the libertarian illegitimate. For the neoliberal, on the other hand, excessive taxation is merely empirically unwise.

[the ideology conceptually closest to libertarianism may instead be Marxism - both Marxism and libertarianism are centred on the concept of the illegitimacy of exploitation of the individual. But Marxists are worried about the exploitation of an individual's labour, while libertarians are worried about the exploitation of an individual's property...]

Of course, in a loose sense 'libertarian' can be used for anyone non-authoritarian, anyone right-wing, both, or neither. In this sense, Bastiat was certainly a 'libertarian'. I don't know enough to know whether he was genuinely libertarian or merely neoliberal - although his rhetoric appears libertarian, as he refered to taxation as "legalised plunder", which seems to at least imply a legitimacy concern rather than merely a policy efficiency concern like Friedman's.

[dhok]

It should be noted that Milton Friedman wasn't a true libertarian either. He was a neoliberal on consequentialist grounds: he believed that laissez faire economics was empirically the best way to improve everyone's lives. Accordingly, he supported redistributive taxation to support the poor, government funding of education (funded by taxation), government provision of some public services (funded by taxation), and government interference in monetary supply, and he actively assisted the treasury in increasing taxation in wartime because it was 'necessary'. His objections to what he saw as excessive government interference were therefore pragmatic, not essential commitments.

A true libertarian in the ideological sense is not just someone who promotes lower taxes, but someone who believes that when something is genuinely a person's property, that person has almost unlimited rights over that property, and society has little or no right to interfere in their enjoyment of that property, or, crucially, to take property away from its owner. Coercive taxation in all but the most extreme circumstances - or at least coercive taxation for any purposes other than the necessary protection of the basic liberties of the individual taxed, is therefore for the libertarian illegitimate. For the neoliberal, on the other hand, excessive taxation is merely empirically unwise.

[the ideology conceptually closest to libertarianism may instead be Marxism - both Marxism and libertarianism are centred on the concept of the illegitimacy of exploitation of the individual. But Marxists are worried about the exploitation of an individual's labour, while libertarians are worried about the exploitation of an individual's property...]

Of course, in a loose sense 'libertarian' can be used for anyone non-authoritarian, anyone right-wing, both, or neither. In this sense, Bastiat was certainly a 'libertarian'. I don't know enough to know whether he was genuinely libertarian or merely neoliberal - although his rhetoric appears libertarian, as he refered to taxation as "legalised plunder", which seems to at least imply a legitimacy concern rather than merely a policy efficiency concern like Friedman's.

I think this is true of a lot of people who call themselves libertarians, but it's reductionist. Can one oppose the restoration of landed gentry and be a conservative? (Metternich would think so; but we've moved past him).

If libertarianism is a "third branch" of politics, then modern neoliberalism is sort of to libertarianism what One-Nation Tories/Rockefeller Republicans are to the Right or Clintonite Democrats/New Labour are to the Left--a moderate paradigm within the same tradition, asking the same questions, but not straitjacketed by dogma. I would say the key question being asked by reasonable people within the libertarianish tradition is "how can we eliminate rent-seeking?"--where public-sector unions, regulatory capture, untaxed land rents, and even untaxed carbon pollution all fall under the category of "rent-seeking".

I will be the first to admit that there is a massive optics problem to be solved before the once and future libertarianism becomes first in the minds of its adherents.

[Nortaneous]

A true libertarian in the ideological sense is not just someone who promotes lower taxes, but someone who believes that when something is genuinely a person's property, that person has almost unlimited rights over that property, and society has little or no right to interfere in their enjoyment of that property, or, crucially, to take property away from its owner. Coercive taxation in all but the most extreme circumstances - or at least coercive taxation for any purposes other than the necessary protection of the basic liberties of the individual taxed, is therefore for the libertarian illegitimate.

This is, if true at all, a very recent development. I was at least libertarian-adjacent ten years ago and I didn't see anything like that at all.

[Ares Land]

Of course, in a loose sense 'libertarian' can be used for anyone non-authoritarian, anyone right-wing, both, or neither. In this sense, Bastiat was certainly a 'libertarian'. I don't know enough to know whether he was genuinely libertarian or merely neoliberal - although his rhetoric appears libertarian, as he refered to taxation as "legalised plunder", which seems to at least imply a legitimacy concern rather than merely a policy efficiency concern like Friedman's.

Bastiat was a liberal, there wasn't much need to add neo- at the time
If he'd been British I suppose he would have been a Whig.

If libertarianism is a "third branch" of politics, then modern neoliberalism is sort of to libertarianism what One-Nation Tories/Rockefeller Republicans are to the Right or Clintonite Democrats/New Labour are to the Left

I'm not sure about that. To me neoliberalism, Rockefeller Republicans and New Labour amount to the same thing, pretty much.

A true libertarian in the ideological sense is not just someone who promotes lower taxes, but someone who believes that when something is genuinely a person's property, that person has almost unlimited rights over that property, and society has little or no right to interfere in their enjoyment of that property, or, crucially, to take property away from its owner. Coercive taxation in all but the most extreme circumstances - or at least coercive taxation for any purposes other than the necessary protection of the basic liberties of the individual taxed, is therefore for the libertarian illegitimate.

This is, if true at all, a very recent development. I was at least libertarian-adjacent ten years ago and I didn't see anything like that at all.

The key thing, I believe, about libertarianism is that it's not utilitarian - actually, it opposes utilitarianism.

Various political tendancies will want to protect private property and limit taxation because they believe it optimizes general prosperity.
Libertarians will defend private property and oppose taxation, because it's the right thing to do. That is, private property is an end in itself, not a means towards greater property.

There's a lot to be said for the libertarian position on that account. The problem with libertarianism, I believe, is that their definition of coercion is messed up, and their refusal to seriously consider externalities. (I'd like to see a libertarian that is willing to seriously consider climate change.)

[Raphael]

Of course, in a loose sense 'libertarian' can be used for anyone non-authoritarian, anyone right-wing, both, or neither. In this sense, Bastiat was certainly a 'libertarian'. I don't know enough to know whether he was genuinely libertarian or merely neoliberal - although his rhetoric appears libertarian, as he refered to taxation as "legalised plunder", which seems to at least imply a legitimacy concern rather than merely a policy efficiency concern like Friedman's.

Bastiat was a liberal, there wasn't much need to add neo- at the time

I was about to post the same thing. Marx wasn't a neomarxist, either.

A true libertarian in the ideological sense is not just someone who promotes lower taxes, but someone who believes that when something is genuinely a person's property, that person has almost unlimited rights over that property, and society has little or no right to interfere in their enjoyment of that property, or, crucially, to take property away from its owner. Coercive taxation in all but the most extreme circumstances - or at least coercive taxation for any purposes other than the necessary protection of the basic liberties of the individual taxed, is therefore for the libertarian illegitimate.

This is, if true at all, a very recent development. I was at least libertarian-adjacent ten years ago and I didn't see anything like that at all.

The key thing, I believe, about libertarianism is that it's not utilitarian - actually, it opposes utilitarianism.

Depends. David D. Friedman (son of Milton) is a fairly outspoken anarcho-capitalist, and seems to call himself a libertarian, but seems to start out from a cost-benefit rather than philosophically derived "rights" position.

The problem with libertarianism, I believe, is that their definition of coercion is messed up, and their refusal to seriously consider externalities. (I'd like to see a libertarian that is willing to seriously consider climate change.)

Completely agree. As it happens, in my own political beliefs, opposition to coercion as I understand it and support for freedom as I understand it are fairly important - but I completely disagree with what I see as the artificial and overly legalistic libertarian definitions of those things, so I support left-wing economic policies and vote for more or less left-leaning parties and candidates.

(In short, IMO freedom is first and foremost about having options. The more options a person has, the freer that person is; the fewer options a person has, the less free that person is. And by "options", I mean things that a person is actually practically able to do, not just things that a person is theoretically legally allowed to do. I think laissez-faire economic policies usually create situations in which most people have few options, often none of them good, while left-leaning economic policies can sometimes create situations in which the average person has more options, some of which might even be good.)

[mèþru]

the majority of libertarians are not those extremely radical people, but just the American equivalent of what most European countries call liberals. They are generally in favour of both social freedoms (varying heavily between individuals on whether this should be done by law or by lack of law) and a deregulated economy.

[Ares Land]

the majority of libertarians are not those extremely radical people, but just the American equivalent of what most European countries call liberals. They are generally in favour of both social freedoms (varying heavily between individuals on whether this should be done by law or by lack of law) and a deregulated economy.

I know a few European libertarians. They're pretty radical; but then again gun ownership alone alone qualifies as extremely radical in Europe. (*)
I've yet to meet the original American libertarian!

(*) Except in Switzerland. But Switzerland makes Donald Trump look like Bernie Sanders.

[Vijay]

I've yet to meet the original American libertarian!

Same...

Most people I know of who consider themselves "libertarian" here in the US are basically conservatives for all practical purposes.

[mèþru]

I have a libertarian history teacher. He is in favour of greater environmental protection but otherwise wants minimal government interference in the market.

[mèþru]

This is big news!
http://www.bbc.com/news/live/business-45991505

[Salmoneus]

As with all terms, 'libertarian' is used on the ground in many different ways. Originally, it meant anyone opposed to authoritarianism; later it came to be associated particularly with the right, so some people use it to mean just 'right-wing but not authoritarian'. In America, there's the added complication of a relatively old Libertarian Party, so some people use 'libertarian' to mean 'the sort of people who might vote Libertarian'. And since the Libertarians are as much a protest party as an ideological one, that can include all sorts of people.

However, it's useful to be able to talk about actual ideologies, rather than party affiliations. It's also important to distinguish someone's policy positions (what they think should be done) from their ideology (why they think it should be done). Neoliberals and libertarians will often have similar policy positions - but they have very different ideologies. [they can also of course have different policy positions. For instance, true neoliberals oppose monopolies and support, at least in theory, processes to combat them (even if in practice they tend to be far too gunshy about applying those processes). Some libertarians agree, but a lot of libertarians have no objection to monopolies even in theory, and oppose any antitrust rules on principle.]

Why does it matter why people think things? Well for one thing, understanding why people think something is a big part of changing their minds. So if you want to persuade a neoliberal to support state intervention, you generally try to do that by demonstrating that there's an inefficiency in the market that market solutions are unable to solve, but that creates a significant shortfall in public utility, and then by demonstrating that there's a way that the state can intervene that can actually address that inefficiency, and can do so in a way that won't cause even bigger problems. They're likely to be hard to persuade, of course - if they were easily persuaded of the effectiveness of the state, they wouldn't be neoliberals - but almost all of them are open to being persuaded in this way on at least some issues. Milton Friedman, as we've said already, accepted several forms of state intervention in practice. Indeed, it's fair to say that most modern Western government are broadly neoliberal in their politics, albeit a more moderate form than the form Friedman would have called for.

But if you use that argument against a libertarian, you'll get nowhere, not because they're necessarily any more 'extreme', but because they value totally different things. The mere fact of a public utility shortfall is, to them, irrelevant, when fundamental human rights issues are at stake. If you want to persuade them to support government intervention, your best shot is instead to argue that intervention is necessary and proportionate to protect the basic rights - for instance, libertarians will usually support the enforcement of contracts, and in theory they'll oppose slave labour, though they tend to be gunshy on that (in terms of how you can prove that the worker hasn't consented to their work).


It should also be noted that libertarianism is more properly seen as a set of related ideologies that come to similar conclusion, though often for quite different reasons. The core commonality is the idea of consent: people ought not to be used or abused, exploited or imprisoned, without their consent. But there are in turn several reasons to prioritise consent. The main current is Kantian in origin, and comes from the command to treat all individuals as ends in themselves, not as means to some other end. But the same rules can also be derived from a social contract approach (consent is something we all have or would have agreed to, for example, beyond the Rawlsian veil), or from the point of view of democratic legitimacy (where the government violates the consent of some to favour the interests of others, it can be argued to no longer be representing the whole population impartially).


And of course, people can be more or less libertarian, and can be both libertarian AND neoliberal...

----

Bastiat of course wouldn't have called himself a neoliberal. But 'classical liberal' is a historical term that doesnt' map neatly onto modern categories. Classical liberals were all liberal - but some wer neoliberals, some were libertarians, some were liberal egalitarians, etc.

[alice]

This is big news!
http://www.bbc.com/news/live/business-45991505

The Chancellor can say what he likes. It'll all be rendered irrelevant when we leave the EU without a deal anyway.

[chris_notts]

This is big news!
http://www.bbc.com/news/live/business-45991505

The Chancellor can say what he likes. It'll all be rendered irrelevant when we leave the EU without a deal anyway.

He'll have a fun choice. If we leave with no deal then the immediate impact of a sharp cut in demand for our exports will likely be a big drop in the value of the pound, a recession, falling tax revenues, and a rapidly increasing government deficit. Given the deficit fetishism of the Conservatives their natural response would be to do little or nothing to counteract the economic pain, and possibly even cut more in the long run.

The Bank of England, if they believe in their inflation mandate, should also probably raise interest rates, although in the past they've let other concerns override their theoretical mandate. I hope they would be sane enough not to pursue the Volcker strategy. Ultimately it will depend which is more important to them, the real economy or the kind of hard money policies that much of the City would be more likely to favour.

I'm not a believer in the Friedmanite supply of money thinking, but the UK is an open economy that imports a lot of basic necessities, so if exports drop off a cliff and the government runs a big deficit then the likely impact will be significantly higher inflation. But even so, I think tightening to try to maintain the value of the pound would be a big mistake. The issue is that, in the event of a decrease in exports and a recession, the only way to shore up the value of the pound would be a big reduction in demand, i.e. lower wages or fewer jobs via fiscal tightening or higher interest rates. But the UK is such a heavily financialised economy that a shock of that kind would mean a lot of people going broke, defaulting on their mortgages, car loans, etc. and general economic devastation. All reducing demand would do would be to put all the pain on the have-nots instead of spreading the pain across everyone via higher inflation.

Call me a pinko commie socialist if you like, but I think that targeting low inflation at all costs is fundamentally a policy to benefit holders of financial assets (otherwise known as the rich), and that sometimes higher inflation is worth it to maintain high employment and share the pain of tough times more evenly.

[Salmoneus]

He'll have a fun choice. If we leave with no deal then the immediate impact of a sharp cut in demand for our exports will likely be a big drop in the value of the pound, a recession, falling tax revenues, and a rapidly increasing government deficit. Given the deficit fetishism of the Conservatives their natural response would be to do little or nothing to counteract the economic pain, and possibly even cut more in the long run.

It may depend on the politics. Can they blame it on the EU? If not, they may feel the economic pain is too directly attributable to them. I suspect what they'll do is not so much make big cuts as just cancel these modest spending increases.

I don't think it's accurate to describe them as deficit fetishists: let's be clear, the Cameron and May governments have been running much larger deficits than Blair ever did, and they've increased the debt to its highest level since the 1960s. What they are is pain fetishists: they're not inflicting pain to reduce the deficit, they're slowly reducing the deficit as a side-effect of inflicting pain. They've been intentionally holding back the economy and redistributing wealth from the poor to the rich, because they believe that 'austerity' is a moral virtue - economically, they'd have cut the deficit quicker by investing more and thus producing faster growth in tax receipts. Obama, for instance, had a truly massive stimulus, but still got the deficit down quicker than Cameron did.
[quote
The Bank of England, if they believe in their inflation mandate, should also probably raise interest rates, although in the past they've let other concerns override their theoretical mandate. I hope they would be sane enough not to pursue the Volcker strategy. Ultimately it will depend which is more important to them, the real economy or the kind of hard money policies that much of the City would be more likely to favour.[/quote]
Actually, I think the City's fine with the Bank printing money and handing it to them.

I'm not a believer in the Friedmanite supply of money thinking, but the UK is an open economy that imports a lot of basic necessities, so if exports drop off a cliff and the government runs a big deficit then the likely impact will be significantly higher inflation. But even so, I think tightening to try to maintain the value of the pound would be a big mistake. The issue is that, in the event of a decrease in exports and a recession, the only way to shore up the value of the pound would be a big reduction in demand, i.e. lower wages or fewer jobs via fiscal tightening or higher interest rates. But the UK is such a heavily financialised economy that a shock of that kind would mean a lot of people going broke, defaulting on their mortgages, car loans, etc. and general economic devastation. All reducing demand would do would be to put all the pain on the have-nots instead of spreading the pain across everyone via higher inflation.

They won't try to maintain the value of the pound. Indeed, a falling pound would benefit exporters. It'll hurt consumers by increasing the cost of imports, but the government will probably blame that on EU tariffs and border controls. I suppose if it plumets enough, they may try to slow it down.

Overall, though, there's plenty of space to increase inflation (which might actually provide a nice boost to the economy in the short term), and I think the Bank is still quietly terrified of another funding crisis. We're probably heading for a global recession in the next five years anyway, and I don't think the Bank wants to precipitate that by taking away funding. The Bank is explicitly committed to protecting the economy as a whole, not just inflation - and they recognise that inflation is easier to control in a non-crashed economy.

Call me a pinko commie socialist if you like, but I think that targeting low inflation at all costs is fundamentally a policy to benefit holders of financial assets (otherwise known as the rich), and that sometimes higher inflation is worth it to maintain high employment and share the pain of tough times more evenly.

The policy isn't for low inflation at all costs, it's for stable inflation of around 2%, because this grows the economy fastest. Slightly higher inflation can actually help a little in the short term - but the problem is, the ability to control inflation diminishes as inflation increases. It's an exponential process, not a linear one. So the feeling is it's best to hurt a little keeping inflation far down, because if we let it rise it's hurt much more to get it under control tomorrow. The only stable inflation is low inflation - the higher it is, the quicker it rises.

But it's important to note that, no, low inflation is not a policy to benefit the rich. Low inflation hurts the rich, relatively speaking. High inflation doesn't hurt the rich, because the rich don't have much money - instead, inflation is effectively a tax on the middle classes, who are the people who have the money (and the debt).
[The poor don't have money because they're poor, so they're OK with inflation. The rich don't have money either, because they use their money to buy investments, which inflate much slower, or even benefit from inflation in some cases. The middle classes suffer from inflation, because they're the ones who have a) bank savings (which are worth less) and b) bank debt (which is worth more).]

It should also be noted that higher inflation does not lead to lower unemployment, except as a transitory phenomenon - indeed, some research suggests that the the opposite is sometimes true.

[zompist]

The policy isn't for low inflation at all costs, it's for stable inflation of around 2%, because this grows the economy fastest. Slightly higher inflation can actually help a little in the short term - but the problem is, the ability to control inflation diminishes as inflation increases. It's an exponential process, not a linear one. So the feeling is it's best to hurt a little keeping inflation far down, because if we let it rise it's hurt much more to get it under control tomorrow. The only stable inflation is low inflation - the higher it is, the quicker it rises.

But it's important to note that, no, low inflation is not a policy to benefit the rich. Low inflation hurts the rich, relatively speaking. High inflation doesn't hurt the rich, because the rich don't have much money - instead, inflation is effectively a tax on the middle classes, who are the people who have the money (and the debt).
[The poor don't have money because they're poor, so they're OK with inflation. The rich don't have money either, because they use their money to buy investments, which inflate much slower, or even benefit from inflation in some cases. The middle classes suffer from inflation, because they're the ones who have a) bank savings (which are worth less) and b) bank debt (which is worth more).

I'm not so sure about some of this. What's wrong with 4% inflation? It would be hard to prove claims one way or another, since where inflation really causes things to happen is in central bankers' heads; they are eternally terrified of the 1970s and therefore keep economies severely throttled at all times. The post-2008 experience hasn't been a great advertisement for near-2% inflation.

And why would inflation hurt the rich? Your argument seems to be that it's the middle class that are harmed by it... but that doesn't say anything about the rich one way or another. It's certainly suggestive that central bank policy is almost always pro-austerity and anti-inflation. It's a little strange to suggest that that policy is not what the rich want. (The rich may be foolish to want it, but that's another story.)

Also, did you get the bank debt part backwards? Inflation lessens debt, at least if it's fixed-rate. And here, at least, the minimum wage doesn't keep up with inflation, so that definitely hits the poor.

[dhok]

Given the amount of debt that American (at least) households are tied down by, I'm surprised nobody has run on a William Jennings Bryan-esque platform of deliberately engineering a spurt of higher inflation to ease debt burdens. It certainly seems like it would be much less destructive than allowing a wave of defaults or huge amounts of debt forgiveness (which would just create moral hazard long-term, in addition to the cost, if it weren't paired with aggressive measures to keep people from borrowing as much in the future. A cycle of debt bubbles followed by forgiveness would be reckless).

[mèþru]

Inflation comes with its own bag of problems, especially as wages in the US are generally unadjusted for inflation for both middle and lower class jobs. IMO the solution is reducing the price of college, mandatory matching of the minimum wage to inflation and forgiving existing debts. This doesn't have to happen to solve the problem, but I also think public colleges shouldn't charge for classes and rooming.