Reform, Regulation, and the Liberaltarian Turn*

Peter writes:

Well, one possibility is that the right uses social issues and national defense not as wedge issues but as ways of gaining the trust of the middle class, and then learns how to govern on the domestic front in a way that’s roughly acceptable to the middle and lower-middle class. Libertarians won’t like this much, and those on the far left will of course be frustrated, but there’s at least a potential for a coalition there.

I don’t think this is Peter’s intention, but this is how some would characterize the reformist politics advanced by Yuval, Ramesh, Ross, yours truly, and a number of others. And I think it’s not an entirely sound characterization. In Grand New Party, Ross and I spend a good deal of time talking about frameworks that are pro-market and thus opposed to corporate collusion and the cozy big government-big business axis that libertarians rightly and adamantly oppose. Peter suggests that conservatives choose healthcare as the first domain of an anti-corporate turn. That’s an area we cover at length, and I think Peter will (mostly) like it. I’d caution only that the history of the politics of deregulation offers some valuable insights — frankly, Ted Kennedy and Stephen Breyer were smarter about deregulation than the Reagan White House, and the differences in their respective approaches are highly instructive.

My main concern is framing a pro-market politics that connects with a broad majority of voters because, like Virginia Postrel, I am a dynamist — a believer in an open, creative culture undergirded by an open, creative economy. And like Will Wilkinson, I think Hayek’s understanding of the welfare state was right. In fact, I was particularly struck by this post, in which Will and I achieve near-total consensus.

At this point, I’m not sure where I really stand, though I think I’m tilting in favor of Heckmanesque early childhood programs as part of the liberaltarian package, which also would include wage subsidies and beefed-up unemployment benefits together with a radical deregulation of the labor market and the economy at large.

The main difference between the two of us is, as Will noted, is that I’m far more accepting of, or even friendly to, conservative moral intuitions, whether or not I share them. I think that’s right. Also, Will is more coherent than I am, but that goes without saying.

What Will calls liberaltarian welfare statism was a key part of my political self-definition. Michael Lind was the first person who introduced me to the idea that Hayek defended the idea of a basic social minimum, and that piqued my interest in the pro-market right. I first encountered the Heckman-Carneiro work on human capital development in 2003, which I then pressed upon anyone who’d listen. I read Edmund Phelps’s Rewarding Work around the same time I read Christopher Jencks’s brilliant The Homeless, still one of the best books I’ve ever read. Though neither Phelps nor Jencks can be described as conservatives — certainly not Jencks, who is probably my favorite egalitarian liberal — I think both books accelerated my undergraduate self-understanding from the political left to the political right, which is, biographically speaking, a little off. I think most campus conservatives are motivated by what they perceive as political correctness run amok, etc., but that sort of thing never exercised me all that much. But what both the Jencks book and the Phelps book do is complicate an overfamiliar picture: the plight of the homeless is not, as Jencks explains, is real, but it doesn’t work the way most of us think it works. Similarly, Phelps explains that economic exclusion is the main driver of poverty. These are powerful ideas, which are entirely compatible with a certain kind of center-left reformism. The trouble is that center-left reformists are, in my experience, too dismissive of the agency of individuals. I realize that this is a pretty sweeping claim!

This past weekend I spent a lot of time both with elite-educated, ambitious young people at a wedding full of unfamiliar people and also with a few people working in tourist-dependent sectors who’ve been buffeted by the economic downturn. I hesitate to talk about my conversations in too much detail, because I know we tend to see things through prisms that interpret evidence to reinforce what we already “know” to be true. I obviously don’t “know” a damn thing about any of these people, in any profound sense. Yet my family was pretty chameleon-like, and spent a good deal of time at various points along the economic spectrum, so I like to think that I’m unsentimental and good at absorbing social data osmotically. Let’s just say that I was struck by the particular facts of the individual stories I kept coaxing out of people, and by how values informed life choices. That is, a taste for freedom and autonomy led to more risk-taking and thus to sharper fluctuations in economic outcomes. The quality that propelled some people forward, affluent and less-affluent, was a sense of having control over one’s life.

Is this sense of autonomy a fiction? I don’t doubt that it could be, though of course my instinct (as a paradigmatic anarchist and Posner-aping nonconformist) is that it’s not. But I certainly sense that it is at the very least a useful, happy-making fiction, and that it ought to be cultivated.

I’m in the Bay Area during what is likely the most beautiful week of the year. Everyone tells me that I shouldn’t be misled into believing that the weather is generally like this, and I feel correspondingly very fortunate.

  • Let me just note that the title of this post is truly miserable.