The only function of economic forecasting is
to make astrology look respectable

Last week, I chaired what turned out to be a passionate, courageous and grounded debate between three intellectuals from each point of the political triangle: conservative, classical liberal and social democrat.

Dr Mark Pennington set out the inescapable reality of imperfect knowledge and incomplete rationality in human actors in defence of markets. Richard Murphy argued for a “cappucino” of state and market, flat rejecting neoliberalism. Jesse Norman MP critiqued the flaws in the theories of neo classical economics and completely disagreed with Richard. You can find the video here:

The Future of Political Economy from Steve Baker on Vimeo.

It was a huge pleasure to introduce a fascinating, pugnacious set of presentations and to chair a lively Q&A. I know everyone present appreciated such a rigourous, frank and challenging yet good-natured conversation.

In the end, I was encouraged that all speakers were united in their desire to promote human flourishing. We may disagree about ways and means, but there seems to be no disagreement that the objective is a prosperous and fulfilling society. 

I am extremely grateful to the speakers for taking part.

Biographies

Dr Mark Pennington is the author of Robust Political Economy: Classical Liberalism and the Future of Public Policy. He is Reader in Public Policy and Politial Economy at Queen Mary University London and a winner of the Atlas Institute for Economic Research prize for “contributions to the understanding of spontaneous order”. His speciality is the implications of Hayekian and public choice concepts for the evaluation of social-economic systems.

Richard Murphy is presently completing The Courageous State: Rethinking economics and the role of government for publication later this year. Richard specialises in tax and he is Director of Tax Research LLP. He is the principal author of books including “Tax us if you can”.

Richard has worked for the TUC and others on the tax gap in the UK. He has written extensively on tackling the UK’s deficit without imposing cuts on the most vulnerable in society.

Jesse Norman is Conservative MP for Hereford and South Herefordshire and author of The Big Society – the anatomy of the new politics. Educated at Eton and Merton College, Oxford, Jesse left his job with Barclays in the City in 1997 to teach at University College London.

Jesse was selected to stand for Parliament at an open primary in 2006.

From bella gerens, an excellent explanation and defence of libertarianism:

The truth is that advocates of freedom are found all over the political spectrum, but the only true libertarians are the ones who advocate it at all times in all circumstances, from the bedroom to the wallet – who believe that ‘freedom from’ is the only state of being consistent with the dignity and majesty of humankind.

‘Freedom from’ is the most important part of that ideology. Freedom from coercion. Freedom from interference. Freedom from oppression.

‘Freedom to’ is where the misunderstandings enter. People on the right think libertarians are advocating freedom to burgle, rob, rape, murder – because they read ‘freedom’ to mean ‘freedom to do whatever you please.’

People on the left think libertarians are advocating exploitation, pollution, callousness, and the primacy of making (and keeping) money above all else – because they read ‘freedom’ to mean ‘freedom to do whatever you please.’

And both sides think libertarians consider the laws we have prohibiting these activities to be a restriction on freedom.

When will they realise that they don’t understand?

It is now undeniable that a century or so of managerialism — of thinking the state knows best and is entitled to trespass on your private property for your own good and for that of your fellows — has succeeded in creating a segment of society within which anything goes and from which it is increasingly hard to escape: a segment populated by libertines who torment themselves and others despite a state which tries desperately to care for them at vast expense, an expense it forces on everyone, including those of meagre means.

Of course, the approach has now also succeeded in ruining us all, though not all have yet realised it, while delivering a state with tremendous power over our lives, and virtually every aspect of our lives too. Consider:

The state now looms far larger in many parts of Britain than it did in former Soviet satellite states such as Hungary and Slovakia as they emerged from communism in the 1990s, when state spending accounted for about 60% of their economies.

The question now is not how state power should be used to save us, but how state power can be gracefully dismantled so that we can save ourselves and one another from a system which plainly does not work.

What should now follow is a social system of mutual cooperation based on private property and the rule of law. Whether such a system comes to pass is up to us.