Bryan Caplan writes that Tyler Cowen’s Cato essay, which I addressed earlier, may be the worst advice ever given to libertarians. To wit:

But what about Tyler’s argument that prosperity and the growth of government are a “package deal”? Again, it’s hard to make sense of this. There’s got to be more to being a “package deal” than the fact that two things both happened. …

With statist preferences, more wealth brings more government. How is that a reason to quit arguing against statist preferences? You could just as easily tell an atheist that more wealth brings more religion — and he’d naturally respond, “It wouldn’t if people knew the truth — and I aim to tell them.”

I wonder, by the way, whether Cowen would accept Michael Tanner’s list of Dubya’s contributions to the welfare state as part of the package deal that libertarians ought to just get over.

(Also posted to Sinners in the Hands of an Angry Blog.)

Tyler Cowen is a brilliant, brilliant man and one of contemporary libertarianism’s brightest lights. His scholarly and bloggerly contributions are far above my poor powers to add or detract. Which is why it comes as a surprise that his mini-essay contribution to the Cato Unbound discussion of Brian Doherty’s “Radicals for Capitalism” is shockingly, embarassingly bad.

I can only imagine that the giant holes with which he so generously littered his contribution were left unplugged due to the enforced brevity of the Cato Unbound format. Cowen begins by correctly noting the movement of policies in a more libertarian direction (lower inflation, less confiscatory tax rates) and the death — or at least persistent vegetative state — of many of our bete noires (Marxism, central planning) in the last 30 years.

Then, bizarrely, he unfurls the so-called “libertarian paradox”:

Those developments have brought us much greater wealth and much greater liberty, at least in the positive sense of greater life opportunities. They’ve also brought much bigger government. The more wealth we have, the more government we can afford. Furthermore, the better government operates, the more government people will demand. That is the fundamental paradox of libertarianism. Many initial victories bring later defeats.

I am not so worried about this paradox of libertarianism. Overall libertarians should embrace these developments. We should embrace a world with growing wealth, growing positive liberty, and yes, growing government. We don’t have to favor the growth in government per se, but we do need to recognize that sometimes it is a package deal.

The old formulas were “big government is bad” and “liberty is good,” but these are not exactly equal in their implications. The second motto — “liberty is good” — is the more important. And the older story of “big government crushes liberty” is being superseded by “advances in liberty bring bigger government.”

Libertarians aren’t used to reacting to that second story, because it goes against the “liberty vs. power” paradigm burned into our brains. That’s why libertarianism is in an intellectual crisis today. The major libertarian response to modernity is simply to wish that the package deal we face isn’t a package deal. But it is, and that is why libertarians are becoming intellectually less important compared to, say, the 1970s or 1980s. So much of libertarianism has become a series of complaints about voter ignorance, or against the motives of special interest groups. The complaints are largely true, but many of the battles are losing ones. No, we should not be extreme fatalists, but the welfare state is here to stay, whether we like it or not.

The germ of a decent idea — or at least a position that could be cogently defended — is buried in here somewhere, but Cowen goes off the rails pretty quickly. Yes, it is true that greater wealth is usually accompanied by greater welfare spending but it must not necessarily be so. (And it is more accurate to say that government growth is accompanied by … the spinning of the globe. Always and everywhere government has grown; it is the rare exception when the friends of liberty succeed in rolling it back a little bit.) Even if we concede that some form of welfare statism is appropriate, if we accept it as part of the “package,” left undetermined is the contours of that welfare state.

There is a difference between government growth in the sense that we pay more each year for certain programs in order to keep up with inflation and, say, expanding Medicare to cover prescription drugs (price tag: $1.2 trillion). There is a meaningful, important distinction to be drawn between limited, state-run welfare programs for the sick and the poor and the who-needs-means-testing-and-long-term-fiscal-sustainability-anyway federal behemoth we have today. What should we accept as part of the package, exactly?

What difference would it make to the economic growth rate if we could cut government spending by half, and taxes by half? (This is not to mention the boosting effect of a libertarian program of deregulation and tax simplification.) What if our growth rate were reliably 7% or 8% instead of 3% or 4%, thanks to those changes?

There is a pretty direct correlation there between “big government is bad” and “liberty is good” — that smaller government and a faster-growing economy means more money in the hands of individuals would surely add to the “positive sense of greater life opportunities.” Otherwise, why not just be France?

Furthermore, there were certainly a heck of a lot of folks back in the ’70s who — before stagflation, Reagan and Greenspan proved them wrong — thought that “modernity” indeed meant super high tax rates and wasteful stimulus spending and price controls and all the rest. Why wasn’t that part of the package? Why weren’t those losing battles?

A time of crisis caused by big government policies came, and libertarian ideas helped ease that crisis and the make the world a better place. Cowen argues that the next crises are not likely to break down along such neat libertarian lines: global warming, natural disasters and contagious diseases, and nuclear proliferation. He may be right, and he certainly has a case in arguing that those are the kinds of issues that governments are uniquely suited to addressing and that libertarians ought to take them up with vigor and with an ideological blank slate. (That said, his Russian roulette argument on global warming is beyond facile. See this excellent Glen Whitman post to learn why.)

But while those are issues may some day hurt us in a big way, we know that a huge welfare state, oppressive regulation, a godforsaken tax system, failing government schools and an irredeemably stupid drug war are hurting us right now. (Oh, yeah, and Iraq.)

Moreover, the next crisis most likely will be the impending bankruptcies of Medicare (2019) and Social Security (midcentury at the latest). If we libertarians follow Cowen’s suggested course on the welfare state — like it or lump it, suckers — we could again wind up with confiscatory tax rates in order pay for dwindling benefit packages that will leave the poor destitute in old age and with inadequate health care. The most devastating effect of all will be on economic growth — you remember, that force that always seems to drive welfare spending.

Cowen is aware of all of this, I know. I will assume he was just being a little too glib in his essay. Not much else could explain it.

(Originally posted to Sinners in the Hands of an Angry Blog.)

Brian Doherty’s 741-page “Radicals for Capitalism: A Freewheeling History of the Modern American Libertarian Movement” was a long time coming, but it is well worth the wait. Doherty says the idea was first suggested to him by Chris Whitten — founder of the much-mourned Free-Market.Net — back in the early 1990s. The decade-plus Doherty took to research and write the book was well spent, because it not only brings to life the visionaries, oddballs and enigmas who built this country’s libertarian movement but it unearths material that is likely to surprise even the old hands. Doherty’s years in the archives at the Foundation for Economic Education, the Hoover Institution, the Institute for Humane Studies and more did not go to waste. The footnotes alone — almost 100 pages — are nearly worth the book’s purchase price!

After a somewhat perfunctory chapter summing up the precursors to America’s modern freedom movement — Jefferson to Nock, more or less — Doherty dives right in with Mises and Hayek as the first two of the five giants he views as having molded 20th-century libertarianism. The other three — Rand, Rothbard and Friedman — come as no surprise and yet Doherty’s decision to frame the book this way was an excellent narrative decision. He drops storylines as appropriate — there’s that 14-year gap between “The Fountainhead” and “Atlas Shrugged,” for example — and picks them up later without so much as a hiccup.

A boatload of other characters come shining through in Doherty’s telling. There’s Leonard Read’s mystic free-marketeering, Robert Lefevre’s peculiar pacifist libertarianism, David Koch’s enigmatic philanthropy, and Karl Hess’s back-to-the-woodshed leave-me-the-hell-aloneism. There is so much more, and Doherty covers it all with grace, color, and evenhandedness. We know Doherty writes for Reason magazine, for example, and not Backwoods Home Magazine, yet he doesn’t obviously pick a dog in the various internecine battles he chronicles.

Nonetheless, he seems to take the most delight in chronicling Murray Rothbard’s never-ending search for a purist cadre of believers who won’t sell out to the allure of mere Friedmanism, all the while searching for a larger political movement through which he could smuggle his brand of anarcho-capitalism.

The book is imperfect, as by nature it must be. Jeff Riggenbach spots a few minor errors at this extensive personal take in Rational Review and says Lefevre is the one person who doesn’t get a fair shake. I, for one, hope future editions include photos of the major players and a corrected index.

“Radicals for Capitalism” is a great read for libertarians, though I’m a little mystified by who else would enjoy reading it. I don’t know enough to say whether political scientists, anthropologists or whomever would find this useful as a study of fringe 20th-century American political movements. But for libertarians, it is not only a fascinating peek into our past but a chin scratcher too.

Doherty bookends his tale with Dubya’s early 2005 push to inject some choice into the Social Security system. To start the book, it’s a sign of how far the libertarian movement has come. Our idea to remake and perhaps eventually remove the New Deal’s tragic legacy was getting a prime-time sales job from a newly re-elected president. How far we had come from the dark days of the Depression when anybody who cared about freedom corresponded with every other person who thought the same. These men and women were out of place and out of time. To close the book, the dismal failure of Dubya’s push — whatever its cause — is a heartening lesson (as if we needed one) of how much farther we have to go.

Still, today, we are looking for a place. We are no longer comfortable with the increasingly theocratic, war-mad, anti-immigrant, big-government right yet uneasy and unwelcome with a left that hikes the minimum wage at first blush and whose leading presidential candidate’s biggest accomplishment by libertarian lights is that she succeeded peerlessly at making the idea of nationalized health care a political dead end.

Doherty ends with a quote from Rothbard, who says libertarians “should remain of good cheer” because “history is on our side.” I am not so optimistic as that, though it is obvious that we ought to take a long view of things if only because the short-term view is too depressing. Each of us American libertarians is lucky to be where we are, when we are. We stand on the shoulders of giants, Doherty’s fine history makes plain. And we have so much work left to do. We might as well whistle while we work.

(Originally posted at Sinners in the Hands of an Angry Blog.)

Megan McArdle writes that even though she and her fellow hawks were “100% wrong” about the likely consequences of the elective U.S. invasion and occupation of Iraq, she won’t engage in the ritual self-flagellation that “doves” demand because as wrong as she was about what a success it would be, the anti-warriors were just as wrong about how it would fail.

That may not actually be true, as Julian Sanchez and his commenters point out. Let’s take me, for example. I’m a dim bulb in the libertarian/noninterventionist/anti-Iraq war firmament, but back in April 2002 I rehearsed what seemed to me at that time to be pretty straightforward, common arguments about why spreading the war on terror to Iraq was unnecessary and unwise (i.e., wrong and stupid).

But, as Marge Simpson says, no one likes a gloater. Now is not the time for folks who opposed the Iraq war to brag that they were right about how things went awry in this paricular foreign adventure, but for those who supported it to reflect on how things can go disastrously awry in any foreign adventure. And, given that, avoid adventurism at all costs! Once upon a time, this quaint notion was known as conservatism.

My crystal ball was cloudy, too, by the way. What I feared most was not a quagmire in Iraq, but the triumph of “an overarching ideology of American messianism which is inherently dangerous to American liberty.” So, I was wrong about that. The idea that pre-emptive war is a sensible foreign policy — Dubya’s fluffy talk about Iran and Syria aside — is dead.

The thing about elective wars is that they’re all good and dandy until you screw one up. Unfortunately, we got an administration so incompetent that it struck out with just one swing of the bat [sorry for the baseball analogy, Tim].

(Cross-posted to Sinners in the Hands of an Angry Blog.)