Update: amended links for public read access.
This afternoon, I am presenting five books which illustrate that ideas are more powerful than armies at the Young Briton’s Foundation conference. Here are the slides:
Click for slides
Or browse here:
Via LearnLiberty.org, another superb video, this time on liberty and community, which reinforces Mises’ argument that “Society is cooperation; it is community in action”:
Via LearnLiberty.org, a great project from the Institute for Humane Studies, Dr Nigel Ashford explains classical liberalism, the doctrine of freedom:
The ten principles from the video are:
Dr Ashford’s short book Principles for a Free Society is highly recommended too.
Occupy London 6 by Nathan Meijer (click for source)
As CNN reports, the V for Vendetta-style Guy Fawkes mask has inspired Occupy protesters around the world. CNN points out:
Ironically Fawkes, far from being the anti-establishment hero he has come to be seen as in the years since his death, was a monarchist who merely wanted to replace the Anglican king with a Catholic queen.
A transcript of his trial with co-conspirators is available here. It’s hard reading for one not accustomed to 17th century English but, in relation to the matter of the conspiracy:
As concerning the second, which is the Matter conspired; it was,
First, To deprive the King of his Crown.
Secondly, To murder the King, the Queen, and the Prince.
Thirdly, To stir Rebellion and Sedition in the Kingdom.
Fourthly, To bring a miserable Destruction amongst the Subjects.
Fifthly, To change, alter, and subvert the Religion here established.
Sixthly, To ruinate the State of the Commonwealth, and to bring in Strangers to invade it.
It’s all far from an answer to the contemporary corporatism which oppresses and impoverishes the majority of us and yet Fawkes inspires those who protest the obvious failures in our present system. Having visited the protest, I believe most protesters are peaceful. I shouldn’t think they are volunteering for the punishment decreed for Fawkes and his conspirators: it included, amongst other things, having their genitals cut off and burnt before them.
The protesters’ use of Fawkes masks is surely far less to do with Fawkes himself and far more to do with the fantasy of revolution against state tyranny that is V for Vendetta. The film, like the protestors, errs in eulogising Fawkes, a traitor and terrorist, but it is not without wisdom.
In particular, in his broadcast speech, V says of the dystopian state of Britain:
How did this happen? Who is to blame? Well certainly there are those who are more responsible than others, and they will be held accountable, but again, truth be told, if you are looking for the guilty, you need only look into a mirror.
And so we should. Each of us, over several generations and with the best of intentions, has voted for parties which offered doctrines of state power, not freedom.
If the banks and other large corporations oppress us and manufacture injustice (and they do), it is because they enjoy privileges granted by the state, privileges which – like deposit insurance and bank bailouts – were meant to protect us. Corporations do not have coercive power: states are territorial monopolies on the use of force. The privileges granted to corporations and the consequent injustices are the tragic result of attempts by democracies to provide what people want: security and prosperity.
In the mid-nineteenth century, Alexis de Tocqueville set out the kind of despotism democratic nations have to fear:
Above this race of men stands an immense and tutelary power, which takes upon itself alone to secure their gratifications and to watch over their fate. That power is absolute, minute, regular, provident, and mild. It would be like the authority of a parent if, like that authority, its object was to prepare men for manhood; but it seeks, on the contrary, to keep them in perpetual childhood: it is well content that the people should rejoice, provided they think of nothing but rejoicing. For their happiness such a government willingly labors, but it chooses to be the sole agent and the only arbiter of that happiness; it provides for their security, foresees and supplies their necessities, facilitates their pleasures, manages their principal concerns, directs their industry, regulates the descent of property, and subdivides their inheritances: what remains, but to spare them all the care of thinking and all the trouble of living?
And so the Government worries about wellbeing in a thoroughly technocratic way and brings you Mindspace: Influencing behaviour through public policy. The state today spends over half of GDP: can anyone seriously believe that this is limited government and a free society? Communist China spends less: 2010 GDP was $5.93 trillion and state spending $1.33 trillion – 22% of GDP .
In The Road to Serfdom, Hayek explained that technocratic government would crush Parliamentary democracy, just as it has done, and lead to tyranny through its own failure. In Capitalism, Socialism and Democracy, Schumpeter made the case that the success of capitalism, in the context of democracy, would lead to corporatism and the fostering of values hostile to entrepreneurship. Capitalism would be replaced by some form of socialism through a tendency, which we have seen, of electorates to return parties of social democracy. Schumpeter believed the intellectual trends of society would destroy the capitalist structure.
And so it has come to pass. In Living with Leviathan, David B Smith writes (as I have blogged before):
New Labour’s so-called ‘third way’, and the prevalent economic paradigm in much of ‘Old Europe’, appears to correspond to none of these categories [free market, socialist and 'Butskellite' mixed]. Instead, it appears to be a system under which the private sector maintains a nominal legal control over its capital and labour, but the returns on these factors of production are so heavily influenced by tax and regulation that the public sector ends up effectively controlling such returns. This sham form of mixed economy, which needs to be distinguished from the British mixed economy of the 1950s, has traditionally been associated with fascist regimes – for example, the gelenkte Wirtschaft (supple or ‘joined-up’ economy) that Goering implemented in Nazi Germany in 1936.
The awful truth for many who protest our present social system, calling for greater democratic control over more extensive state power in the general interest, is that we already live in the system which is the inevitable, predictable consequence of their demands. It is that statist system which is manufacturing injustice, eroding freedom and impoverishing us today.
In the film, V says,
People should not be afraid of their governments. Governments should be afraid of their people.
Indeed, and when people demand liberty over licentiousness and security, their freedom from state power and the dignity to determine their own destiny within a fixed moral framework, no doubt politicians will arise who will give it to them.
I look forward to the day.
I look forward to speaking on the Euro crisis tomorrow at the People’s Pledge Congress. In preparing, I rediscovered this:
…the ideas of economists and political philosophers, both when they are right and when they are wrong, are more powerful than is commonly understood. Indeed the world is ruled by little else. Practical men, who believe themselves to be quite exempt from any intellectual influences, are usually the slaves of some defunct economist. Madmen in authority, who hear voices in the air, are distilling their frenzy from some academic scribbler of a few years back. I am sure that the power of vested interests is vastly exaggerated compared with the gradual encroachment of ideas. Not, indeed, immediately, but after a certain interval; for in the field of economic and political philosophy there are not many who are influenced by new theories after they are twenty-five or thirty years of age, so that the ideas which civil servants and politicians and even agitators apply to current events are not likely to be the newest. But, soon or late, it is ideas, not vested interests, which are dangerous for good or evil.
Via Keynes’ General Theory. He wasn’t all wrong.
The Times is running two letters under the heading, Should the Upper House be a Senate? (£). The first letter calls for a federal senate with equal representation for each nation of the UK. (Quite why the smaller nations should be disproportionately powerful, I do not know.) The second calls for a chamber of representatives from “leading professional and other expert bodies such as the Law Society, the British Medical Association, the Institute of Chartered Accountants, the Royal Institution of Chartered Surveyors, and so on.”
In either case, the call is for representatives with special interests, whether regional or professional. This is an old and wrong-headed idea.
Mises’ 1927 book Liberalism: The Classical Tradition deals with this in chapter 4, section 3. (Ah – recess reading!) Amongst other things, he writes:
A parliament composed of the supporters of the antiliberal parties of special interests is not capable of carrying on its business and must, in the long run, disappoint everyone. This is what people mean today and have meant for many years now when they speak of the crisis of parliamentarism.
As the solution for this crisis, some demand the abolition of democracy and the parliamentary system and the institution of a dictatorship. We do not propose to discuss once again the objections to dictatorship. This we have already done in sufficient detail.
A second suggestion is directed toward remedying the alleged deficiencies of a general assembly composed of members elected directly by all the citizens, by either supplementing or replacing it altogether with a diet composed of delegates chosen by autonomous corporative bodies or guilds formed by the different branches of trade, industry, and the professions. The members of a general popular assembly, it is said, lack the requisite objectivity and the knowledge of economic affairs. What is needed is not so much a general policy as an economic policy. The representatives of industrial and professional guilds would be able to come to an agreement on questions whose solution either eludes entirely the delegates of constituencies formed on a merely geographical basis or becomes apparent to them only after long delay.
In regard to an assembly composed of delegates representing different occupational associations, the crucial question about which one must be clear is how a vote is to be taken, or, if each member is to have one vote, how many representatives are to be granted to each guild. This is a problem that must be resolved before the diet convenes; but once this question is settled, one can spare oneself the trouble of calling the assembly into session, for the outcome of the voting is thereby already determined. To be sure, it is quite another question whether the distribution of power among the guilds, once established, can be maintained. It will always be–let us not cherish any delusions on this score–unacceptable to the majority of the people. In order to create a parliament acceptable to the majority, there is no need of an assembly divided along occupational lines. Everything will depend on whether the discontent aroused by the policies adopted by the deputies of the guilds is great enough to lead to the violent overthrow of the whole system. In contrast to the democratic system, this one offers no guarantee that a change in policy desired by the overwhelming majority of the population will take place. In saying this, we have said everything that needs to be said against the idea of an assembly constituted on the basis of occupational divisions. For the liberal, any system which does not exclude every violent interruption of peaceful development is, from the very outset, out of the question.
If there was a “crisis of parliamentarism” in 1927, how much more so today. Our slow abandonment of the classical British doctrine of liberty has indeed created a Parliament which disappoints everyone. Moreover, we have mostly abandoned policy making by elected representatives in favour of rubber-stamping the work of officials, whether national or international.
What is required is a Parliament which works in the general interest, not one through which particular groups try to advantage themselves by force of law. That means a Parliament committed to the ideals of liberty under the law, which in turn implies a public persuaded that we cannot all live at everyone else’s expense.
However we proceed, special interests will continue to have their opportunities to lobby: they do not need to be elected. It would be crass to make this old error.
No man deserves his freedom or his life
Who does not daily win them anew.
From Goethe’s Faust, quoted in Mises’ Liberalism – The Classical Tradition as “the last word of wisdom”. It appears in the discussion of anti-liberalism’s roots in resentment and neurosis.
Via The Austrians Were Right, Yet Again, Jeffrey A. Tucker sets out the way it is in the USA:
After three-plus years of floundering around, a consensus has finally arrived that we are back in recession. Growth is not happening. The meager statistical growth of the past few years — no one dared claim it amounted to full recovery — was probably illusory.
He goes on to catalogue the government interventions which have been a failure before quoting some of the many Austrian-School commentators who explained why that would be so. Finally, he writes:
Why does anyone continue to take Krugman and company seriously? In fact, why does anyone take seriously those who warned that unless we tried the Keynesian plan, the world would end and we would miss an opportunity for a glorious recovery? It’s not just the New York Times; it’s also the Wall Street Journal and the entire financial press that continues to be enthralled with the absurdities of Keynesian theory.
Let’s rub it in a bit more: The Austrians were also correct that the boom before 2008 was unsustainable. See “The Bailout Reader.” There is no joy in being right here. It is pathetic really that any informed observer of events would not be correct in light of experience and the common-sense observation that government can’t make prosperity appear no matter how many kabuki dances Treasury officials do.
On the winning team are those who understand sound economics. On the losing team are those who keep thinking that poison can cure the patient. So we say again: the stasis and depression will continue until the system is allowed to correct itself.
I’m glad to see Douglas Carswell MP making the case that the mainstream commentators have comprehensively failed us. I explained some of the reasons why they do so on ConservativeHome in December: they lack an adequate theory of capital, amongst other things.
No single school of thought has an absolute monopoly on correctness, but when one school is consistently closer to correctness than another, maybe it’s time to look at the relevant ideas. For example, given a robust theoretical understanding of money, it’s possible to produce a measure of money supply growth which gives a good basis for analysing monetary effects on the economy:
The rate of change of the supply of Sterling
That astonishing precipice in money supply growth happened before Lehman Brothers’ collapse and the tightening of credit conditions. That doesn’t justify QE, which redistributes wealth towards those who receive the money first, or further artificial lowering of interest rates, which further distorts the structure of the economy. It does illustrate the importance of having the right theoretical equipment when analysing practical events. Without that, how can we expect good quality policy recommendations?
A primer on the Austrian School is here and these are some of the better blogs:
Click for PDF
Yesterday, I gave a presentation which sets out:
We went on to discuss what Conservatives can and should do now to reshape our country and make gains in this long-running battle against the rise of the state.
The slides are available here. I have added some additional slides on debt, debasement, monetary factors and the spectrum of ideas.
In connection, I can thoroughly recommend browsing the Conservative Poster Archive: from 1909:
CPA poster 1909/10-14
From a transcript of a lecture given in 1965 by the founder of the Foundation for Economic Education: How to Advance Liberty – Leonard Read .
There would be no need to work for liberty were liberties not being lost. Most Americans are unaware of a decline in individual liberty, and the reason is obvious: the decline rarely takes the form of sudden personal deprivations but, instead, takes the form of unnoticed erosion, and thus we come, as do the Russians, to regard whatever state we are in as a normal condition.
No one can possibly be expected to give a top priority to the advancement of liberty unless he is keenly aware that liberty is important, and that it is in jeopardy. Each individual must make his own assessment but here is my appraisal of how precarious our situation is: While the returns of our own socialistic revolution — devolution is a more accurate word — toward political omnipotence are incomplete and the full extent of the blight far from evident, the devolution itself is a fait accompli, water over the dam. It is no longer an event of the future to be feared; it is a catastrophe of the past to be remedied — and remembered.
In short, the devolution was; that is, the socialistic objective has been achieved. Few people seem to appreciate the terrible fact that, already, we are subject to a centralized government of unlimited power. There now hangs over our economy a political apparatus with the authority to exercise control over the life and livelihood of every citizen; it can confiscate every dollar of our income. The principle of statism is accepted national policy; short of a successful intellectual and moral counterrevolution, all that remains is to await the filling in of the authoritarian details and to suffer the consequences.
The author goes on to develop a quite surprising approach to advancing liberty and I recommend reading the article in full.
