26 Mar 2018

“The fraud of classical liberalism”

Libertarianism 21 Comments

I always like to skim articles like this to see how someone could come up with a title like that. In my (obviously defensive) reaction, I would say the author points to things that are clearly not consistent with classical liberalism–like using armies to engage in “free trade”–or he is simply mistaken about historical causality–like blaming the Great Depression on the gold standard.

However, this is surely what a true socialist thinks when reading a libertarian author who documents the horrors of explicitly socialist regimes. So, are we both at fault? Or do I get to say “That’s not what my philosophy entails!” but the socialist doesn’t get to disavow Pol Pot?

21 Responses to ““The fraud of classical liberalism””

  1. Michael says:

    I’ll admit there is a part of me that cringes everytime I see a post or meme attacking leftists because ‘that wasn’t real socialism’ for this exact reason. How many historical figures have paid explicit lip service to the free market while acting in complete contradiction?

    I think its a weak and unnecessary line of attack, especially since it begins the attack based on history – which is just too complicated. As you often say, everyone can point to the historical record and find some way of interpreting the facts to justify their position. The only way to make any progress is to begin with first principles and build common ground from the foundations of shared and agreed-to beliefs.

    If we proceed this way, we can show that socialists are either naive about human nature, or confused about natural rights. The right to property is the worst offender, since apparently no one has the right individually but somehow we all have the right collectively, and invariably that collective right must be administered by some group of specific individuals.

  2. Uffe says:

    I really enjoyed how he argues that classical liberalism let Germany fall prey to Hitler. Especially since the author later on espouses the view that classical liberalism advocated the gold standard and deflation.

    How you can claim the it was liberalisms drive for deflation in Germany that lead Hitler to take power need some rather special type of explanation.

    Especially in light of the german monetary history of 1914 to 1923.

  3. M1798 says:

    I think the difference is that classical liberals/libertarians can at least point to the existing world and note that the most small-l liberalized economies tend to do the best. Additionally, the author conflates classical liberalism with anarchism. Almost every classical liberal of the 18th and 19th century advocated a base level of government to establish property titles, enforce contracts, etc. The author goes on to name a number of other positions that no, or very few, classical liberals actually held. So he has the philosophy wrong.

    Finally, when you are talking about traditional socialism, where the government owns the means of production, Mises defined it as actual socialists would, and then went on to show why it is destined to be a disaster.

  4. AE Hall says:

    I don’t mean to sound like a complete anti-liberal when I say this, but I think a lot of forceful things follow from Classical Liberalism when taken to its logical conclusions. It, like Progressivism, is a syncratism. Which is why I find it weird when any socialist blames classical liberalism for something, because I happen to agree with the Chomsky-ites on the insistence that Classical Liberalism is a foundation for the more anti-authoritarian left.

  5. Tel says:

    So first he explains that all free trade really comes from government, because you cannot have property without government. Then he goes on to blame everything bad in the world on free trade, and say if only we had government to step in and solve these problems. So about that “fraud” issue…

    I’ve read some of Polanyi’s stuff and never been very impressed.

    In the light of recent discussions around here, this quote is kind of interesting:

    The most important one is the idea of the “self-regulating market.” Adam Smith imagined that markets emerged from mankind’s inherent, natural tendency to “truck, barter, and exchange.” (Pre-modern societies turn out to not function in this way in the slightest, but never mind.)

    Now I had previously thought that our Harold was about as lefty as you could get, without going the full BAMN / ANTIFA, putting on the black mask and mugging people in the streets. Yet, it was Harold who was arguing FOR the existence of division of labour in primitive societies and now we have an anti free-trade author attempting to argue that division of labour suddenly popped into existence with “modern” society (not 100% clear which year that happened presumably around 1800 AD, all these people just grabbed tools and learned a trade for the first time.).

    If the author is willing to massively rewrite history, then I don’t accept this as a genuine attempt at an economic theory. There were famines in India before the British came along, and to claim that Winston Churchill’s wartime economy (when England was also drastically short of food, as was nearly all of Europe) is representative of a “free trade” scenario is quite beyond the pale.

    To me it makes a lot more sense that division of labour gradually increased over time, from simple beginnings up to what we now call a modern complex economy. You can find extremely old evidence of barter trade in Europe from the Mesolithic (flint, amber, jade) and Neolithic (manufactured axe heads). Plenty of evidence for international trade in metals later on (copper, tin, gold, silver). There might have been some concept of “government” at that time, but not a whole lot.

    We can start to get into definitional arguments about exactly what counts as an economy and what doesn’t count, but that’s kind of arbitrary. Clearly by the time of the big empires (Egypt, Greece, Rome, Persia, etc) we had very clear specialized trades, and good documentation from the people at the time to prove this. Since government grew up at the same time that trade also expanded and the division of labour became more extensive, it’s impossible to decide exactly which one depended on the other.

    • Geirdriful says:

      Well, supposing someone is unhappy with their government in its current form, wouldn’t trying to fight that government without government of their own be a bit like trying to fight machine guns with bows and arrows?

  6. Harold says:

    ” I had previously thought that our Harold was about as lefty as you could get…”
    In our last discussion I did say ” It seems overwhelmingly more likely that a market will get closer to the “perfect” outcome than a completely controlled system.” I think one could get further left than that. If I am your idea of an extreme lefty I suggest you get out more!

    You are correct, of course, that pre-modern societies did very much function like that, in part. Cooper is making the same mistake Mises made. Persisting in beliefs in myths like these will lead one astray, whichever side one approaches from.

    It is also wrong to say that markets are “created by Governments”. All developed and sophisticated markets that we currently have exist within the framework of governments, but they are not created by Governments. Man does have a tendency to truck, barter and exchange.

    He says “In England, it meant peasants (including women and young children) being forced off the land by enclosure of the commons, and shoved into factory work through the threat of starvation,…”
    Enclosure acts were passed by Govts, not a result of the free market. They did allow agriculture to become much more efficient, which allows our greater standard of living today. It did so in a way that was unfair. It is a classic “how do we get there from here” position. People in power decided to “get there from here” by screwing the peasants. A free market method would in principle have been possible which would have compensated the peasants, but in practice this was not likely to occur due to the complexities of the individual trades. He argues enclosure as an evil of the market, and Bob I am sure can argue it as an evil of Govt.

    What is interesting is the level of equality in hunter-gatherer societies. These are much less hierarchical than say, chimpanzee societies. Peterson is barking up the wrong tree with lobster comparisons, which are essentially meaningless in the context of human societies.

    Wishing way facts about human behaviour will give you problems, whether promoting socialism or free markets. Early societies had much less trade and were much more egalitarian, but they were neither free of trade nor perfectly equal.

  7. Khodge says:

    “This surely is what a true socialist thinks.” This goes to the heart of the media reporting problems.

    I saw a segment of the View after an especially egregious piece of fake news. The View said that it wasn’t “fake news” that they had passed on, merely a mistake the reporter made (that took him half a day to retract.) When you are the purveyor of garbage defining it as art does not satisfy the accusations.

    Your observation is, as always, dead on: Hiding behind definitions and obfuscations is practiced by commentators in all sectors of discussion and is done to score points, not to honestly forward ideas and concepts.

    • Harold says:

      “The View said that it wasn’t “fake news” that they had passed on, merely a mistake the reporter made (that took him half a day to retract.)”

      This almost certainly means it was not fake news. There is a difference between a mistake and fake news. If a retraction is issued as quickly as half a day it is very unlikely to be fake news.

      It is very helpful for those wishing to spread misinformation to blur the boundaries between deliberate misinformation and mistakes. Since everybody makes mistakes this makes it appear that the deliberate misinformers are no worse than genuine reporters. It deligitamises genuine media and whitewashes deliberate misinformers.

      Fake news is defined by wikepedia as “Fake news is a type of yellow journalism or propaganda that consists of deliberate misinformation or hoaxes… Fake news is written and published with the intent to mislead in order to damage an agency, entity, or person, and/or gain financially or politically, often using sensationalist, dishonest, or outright fabricated headlines to increase readership, online sharing, and Internet click revenue”

      Collins had it as word of the year, defined as “Defined as “false, often sensational, information disseminated under the guise of news reporting”.

      Pizzagate was fake news – it was made up and never retracted. If the author retracts it that tells everyone the story was wrong. Fake news does not do this.

      It is possible that the author could deliberately lie, anticipating that they will issue a retraction later but by then the damage will have been done. This is going to be a very limited occurrence for journalists as retractions are damaging to their reputations.

      As you do not say what this particular story was we can’t know for sure.

      • Khodge says:

        It was the Brian Ross story, the one that got him suspended, and the very picture of fake news.

        The problem is not so much the fake news but the same person (in this case, the View) gets to both screw up big time and evaluate his screw-up as significantly less than it actually is; the difference between reporting the news and becoming the news. Or, in Bob’s example, the same person defining socialism while ignoring every actual attempt at instituting it.

        • Harold says:

          Not fake news, but a significant mistake, bad and sloppy reporting. Criticise him certainly, he deserves it, but it is not fake news. When someone purveying what might be considered fake news retracts, apologises and gets suspended it is not fake news but bad reporting. Fake news is designed to benefit the perpetrator, not do them harm.

          Nobody has retracted and apologised in the many actual fake news stories. It is important to maintain the distinction.

          We should not let him off the hook for the error, but we should keep the term fake news for stories that are actually fake.

          • Khodge says:

            Back to what Bob says.

            This could have been handled correctly. Ross could have double checked his sources; the View could have held back – the show was interrupted so Joy could read the fake news on the spot.

            If they were not locked in their echo chamber, if they took the slightest pride in their work, if they followed basic professional standards, it would never have happened. Their confirmation bias makes it fake news, not a harmless little error.

            One does not get suspended for errors. The reputation of both ABC and the View have been trashed by fake news. One should not be able to blow off the example of Venezuela as a harmless little error when, in fact, it is the necessary outcome of a socialist mindset.

            • Harold says:

              “Their confirmation bias makes it fake news, not a harmless little error.”

              You are presenting a false dichotomy. I never said it was harmless or little. I said it was significant and important, bad and sloppy reporting. It damaged the reputations of ABC and Ross. That does not make it fake news.

              I did not say this should be blown off. I said it should be criticised, so I don’t see where Venezuela fits in.

          • Stephen Dedalus says:

            “Fake news is designed to benefit the perpetrator, not do them harm.”

            Um… well, WWI and WWII were *designed* to help Germany. Not everything designed to be beneficial to some actor winds up being beneficial to them!

            • Harold says:

              “Not everything designed to be beneficial to some actor winds up being beneficial to them!”

              That is true. The story put out by Ross did not benefit him as it was intended to do. The difference is that fake news benefits the perpetrators even if they know it will eventually be discovered to be fake. If you know that you will suffer a lot from sending a false story you are unlikely to do so. In this case significant harm was done to the perpetrator within half a day due to their admission of error. That means it was very unlikely to have been made up to benefit the perpetrator.

              Fake news purveyors expect to get the benefit even if they know the story will be proved wrong.

              This is the difference between MSM journalists and fake news merchants. If mistakes are discovered the perpetrator suffers. Who suffered when Pizzagate was found to be made up? Who lost reputation and got suspended? Certainly not the instigators.

              Pizzagate was fake news because the instigators could start the story knowing they would not suffer when it turned out to be total rubbish. They could make stuff up with impunity. MSM journalists cannot do this – they are held to account for their mistakes.

              I may be banging on about this but it is a very important distinction. There are stories that are wrong because of mistakes, and there are stories that are deliberately made up to misinform. The former are not fake news but the latter are.

              We should not say the former are unimportant – of course journalists should check and be sure of their stories, but their mistakes are different from fake news and they are held to account.

  8. Warren says:

    I think the gold standard murdered this guy’s parents given how deranged he is on the subject.

    • Geirdriful says:

      Well, a lot of people have died over the gold standard.


      No one I personally care about, but I’m not going to sit here and pretend that armies were not used to create the world I am fortunate enough to be in a position to enjoy, or that everyone else is as fortunate as I am. There are plenty of people with valid reasons to object to the gold standard, from their own points of view.

      • Tel says:

        So when a man is robbed, you would be inclined to blame the purse of coins that was stolen from him?

        Interesting variation on the “property is theft” theme.

        This would logically imply that when one group of people invades the land of another group, it must be the land itself to blame. After all, that’s what they are fighting over. Therefore in order to end war we simply have to destroy all the land. Pollution is peace!

        • Geirdriful says:

          If any “blame” were necessary, the blame would go on the desire for the coins, and on the willingness to fulfill that desire by means of robbery.

          But why would we want to end war? Without war we all die. Well, maybe not all of us. Perhaps there are a few very simple life-forms, not even single-celled, who could survive without war.

          Myself, I am a bacteria-thirsty war monger. I wish for my own immune system to win against whatever pathogens have decided to invade my body. Go, white blood cells, go!

          I am also hungry. Therefore, I eat. I am sure the various plants and animals I consume would probably rather I did not. Fortunately for me, my side is winning!

          The Great Sioux War of 1876 demonstrates the advantages of being on the winning team. Basically, would you rather be dead, or would you rather end up with the land and gold? Myself, I’d rather end up with the land and gold.

          However, since the Sioux ultimately lost, I’m sure they would prefer it if people on my team had not desired land and gold so much that they had been willing to send armies after it.

          • Geirdriful says:

            That said, I do find it terribly ironic that the author of the blog post above insisted that using armies to engage in free trade was incompatible with classical liberalism, and then proceeded to talk about the gold standard as if he thought that was compatible with classical liberalism.

            I really don’t see how any trade at all is possible without armies, beginning with armies of white blood cells and other parts of our immune systems. However, even if you do not wish to think microscopic, there were definitely armies involved with the American gold standard. Human armies.

  9. Geirdriful says:

    To play devil’s advocate, John Tully, a self-identified socialist, has shown himself to be quite happy to document the horrors, from his own perspective, of the Pol Pot regime himself, withing the book “A Short History of Cambodia: From empire to survival,” chapter 8, “Pol Pot’s savage utopia, 1975–79.”

    And here is a brief passage from that chapter.

    “One is entitled to ask why western visitors to Bali or Java rarely wonder at the massive slaughter that befell those islands in 1965–66, yet define Cambodia by the killing fields. Yet, unfair as the stereotypical image is, we cannot avoid the horror of the Pol Pot years. According to the CIA, the population of Cambodia stood at around 7.3 million in 1975, with other estimates of up to 8 million. Around 1.7 million of these people were to die during the brief period of DK, up to quarter of a million of them murdered as real or imagined enemies of the paranoid regime. The rest perished due to malnutrition and overwork, lack of medical care and sometimes despair and heartbreak.”

    The chapter cannot be considered complimentary. There’s even a Hitler comparison at the end.

    “The Young Turks killed one and a half million Armenians in 1915–16, but Adolf Hitler recognised the human potential for forgetting when he sold his coming Holocaust to wavering generals by asking them ‘who today remembers the extermination of the Armenians?’ Sadly, he was right. Perhaps in the future some other budding mass murderer will ask the same question of Cambodia.”

    So yes, he can disavow the Pol Pot regime and has done so.

    Do you disavow the gold standard as it was practiced in the United States? Have you written anything revealing the history of how your government took land and gold using armies? How millions of Native Americans died as the result of your government’s actions? What about rubber? Have you written a history documenting how many lives have been destroyed in the making of that commodity? John Tully has. The Devil’s Milk: A Social History of Rubber.

    What I am getting at here, is that to disavow something, you must actually go through the effort of disavowing it, or at least, refrain from defending it. John Tully has gone through the effort of disavowing the Pol Pot regime. You seem ready to defend the gold standard. Perhaps you might change your mind. Have you read about the Great Sioux War of 1876? Once you do so, will it make you wish to disavow the particular version of the gold standard used in the United States?

    Personally, I like capitalism, but this is only because by luck of birth I am one of the winners. Had I been born in the Congo or Ghana, I am sure I would feel very differently.

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