Comment Rescue!

In Russel Saunders’s “We Are The State” essay, there was a delightful exchange that deserves to be highlighted.

Impavid commenter Snarky McSnarkSnark points out:

I made the following observation a few days ago in another post, but I think there is a notion among our conservative and libertarian friends that the “State” is a monolithic object: something all-consuming, and with tentacles that reach into every little crevice of society.

And because “it” is so large, and so pervasive (and therefore powerful), it is something to be necessarily feared and mistrusted. But I don’t think that this conceptualization is very useful, and the outlook leads to a number of fundamental preconceptions with really harmful consequences for policy and society.

There are many roles played by government entities: virtually all because there is no other possible actor with the resources of the “whole” society, or who don’t otherwise have terminal conflicts of interest in exercising these roles. As a non-exhaustive list of such broad societal interests, I would include:

Infrastructure. I think this is the role where all parties can best agree. Someone has to be responsible for building the roads and bridges, the electrical grids, the national defense, and so on.

Rule-setting. Markets do not spontaneously arise: it is in the interest of market players to constrict them (read Adam Smith–he was well aware of this). Rules establishing enforcing the fundaments of a healthy marketplace can make markets more functional and more efficient, and more “fair” for all parties. When there is transparency, accountability, and competition, markets can do a lot that benefit everyone. When these are missing, they often result in perverse incentives that are broadly destructive.

Protection. Of course we need an army, and a police force. But we also need protection from the more rapacious and less ethical members of our own society. We may not, for example, all agree on the way that OSHA rules are implemented, but I think there is a pretty fair consensus that workplace rules that protect worker safety are a generally good thing.

Arbitration. Business exists to make money. Goverment exists to… what? To protect the general interest. We designate the government as the “decider” in many cases because its fundamental mandate is the general welfare. That is not to discount the libertarian critique of bureaucratic entrenchment and rent-seeking, and we should always be on guard for these. But our court systems, and political processes are there, in large part, to make disinterested decisions when we need them. How else would we deal with such issues as global warming, environmental versus resource trade-offs, and the like?

Culture building. I’ll find a lot of disagreement here, I suspect, but I consider it a fundamental public sector responsibility to encourage the best of the society: civility, a common language and culture, the promotion of the ideals and underlying values that undergird any healthy culture. This is especially true now, when the competing instruments of common culture all come from corporate entities: the MTVs and HBOs and Fox Newses.

Outcome mitigation. Although many consider the outcomes produced by a marketplace to be–by definition–fair, it is pretty clear that market rewards are only tangentially related to social worth. Our society rewards a certain kind of person in an outsized way: the risk-taking, socially-connected, organizer–the entrepreneur. That’s all good to the degree that the benefits of commerce is widespread. But–let’s be honest–Bill Gates, or Warren Buffett, or Rupert Murdoch, may be a fine and upstanding citizens, but each has assets that are one million times (or more) that of the median citizen. Each of them makes more in an average week than an average person makes in a lifetime. And because human nature is what it is, they still want more. The social programs you wrote about (Social Security, Medicare, etc.) fall mostly in this category.

Only a government can construct a set of common rules that promotes widespread prosperity, equity, and “fairness.” It would be great if these outcomes could come about spontaneously, but there is really no other party that has the reach and incentives to achieve this.

But I don’t think that it’s really very useful conceiving of “the government” as a single thing. Social Security and National Defense are different things, as are market maintenance, adjudication, education, or public health promotion. They are all “government” roles, only because there is no one else that can reasonable assume them.

By lumping all of these together, and decrying that they are all vested in a single powerful and overwhelmingly powerful “interest,” many conservatives see the government as something frightening. But it is no more a single entity than the marketplace is. It is not competing with the private culture, or private enterprise–it undergirds it.

In response, bodacious commenter Roger rejoins:

Snarky (and those agreeing with him),

I really disagree with the emphasis of your admittedly thorough comment.

“I think there is a notion among our… libertarian friends that the “State” is a monolithic object: something all-consuming, and with tentacles that reach into every little crevice of society. And because “it” is so large, and so pervasive (and therefore powerful), it is something to be necessarily feared and mistrusted.”

I would disagree.  The problem with the state is that it is a coercive, monopoly which attempts to solve problems top down even if better solved decentralized, voluntarily or bottoms up. If making it larger makes it more efficient and effective, I am all for it. In brief, the problem is not size, it is that it is used inappropriately even where not needed.  It can forcefully crowd out superior solutions. Let’s discuss this one at a time…

Infrastructure.  National defense could be a minuscule fraction of what we label defense. Bridges, roads and utilities frequently are provided by private parties. Where government can supply these better than other institutions, I will support doing so.  My number is a very small fraction of the current number though.

Rule setting  Markets do spontaneously arise.  You are right that good rules are necessary, but you are wrong that they can only be provided by government entities. We do need simple, consistent rules, and governments CAN provide these. In reality we have been getting out of control arms races of rent seeking regulations and red tape.  Again, if you were arguing for one thousandth of the rules we actually have, I would agree.  You aren’t though, are you?

Protection. There needs to be protection against predators and parasites, yes. These are often handled well by government entities.  The danger is in extending too much power and rule making to government agents, which attracts the predators and parasites to government office or influence. Again, the danger is in too much government. and you are promoting too much government.

Arbitration. 

“Business exists to make money. Goverment exists to… what? To protect the general interest. We designate the government as the “decider” in many cases because its fundamental mandate is the general welfare.”

You are completely conflating personal and institutional goals here, Snarky.  Businesses exist to solve voluntary consumer problems.  Government exists to solve a class of problem for citizens which cannot be handled voluntarily due to various collective action problems. Employees and investors specialize in voluntary problem solving for consumers in order to make money and achieve status and other life goals.  Politicians, administrators, govenment employess and bureaucrats enter government to make money and achieve status and achieve other life goals. 

Governments do not make disinterested decisions. Obviously we’re all interested in our environment and the costs taken to address them. We often just disagree dramatically. Coercive majority representation is not necessarily the best way to address all these issues.

Culture building. Which cultural values should be promoted? In a winner take all system such as democracy, fractured interest groups will do anything to ensure that their values reign supreme and can be coercively shoved down their enemies throat. The better response here is that the range of top down values needs to be extremely thin and isolated to issues which we overwhelmingly agree. 

Outcome mitigation. 

“Although many consider the outcomes produced by a marketplace to be–by definition–fair, it is pretty clear that market rewards are only tangentially related to social worth.”

In a voluntary, mutually agreed to interactions, which are the sphere covered by markets, rewards to both parties of any interaction are by definition value creating for both. Money is made by workers, entrepreneurs and investors by cooperatively solving problems better than those they compete with. They compete to optimize social worth with the latter term defined as consumer preference or utility.  Market rewards in an appropriately working market are not tangential to social benefit. 

“Our society rewards a certain kind of person in an outsized way: the risk-taking, socially-connected, organizer–the entrepreneur.”

Free markets reward risk takers and creative types and organizers that actually manage to solve problems for fellow men better than others. Risk is not rewarded. Successful risks that make our lives better are rewarded. Work is not rewarded.  Successful, efficient, creative work that contributes to consumer needs is. 

You then make a strange shift to criticism that some make millions of times more than others (so?), so we need social transfer programs.  Huh?  I agree we need social safety nets, but these are irrespective of whether Gates is super rich or not.  Again though, the real question is which social programs need to be coercive and top down monopolies, and which need to be voluntary and less centralized.  

“Only a government can construct a set of common rules that promotes widespread prosperity, equity, and “fairness.” It would be great if these outcomes could come about spontaneously, but there is really no other party that has the reach and incentives to achieve this.”

Governments have existed for ten thousand years in countless societies and basically never managed to deliver widespread prosperity or fairness.  Never.  The key to prosperity and fairness is good institutions and cultural values. Government is just one such institution, and if too monolithic and meddlesome, the larger institutional and cultural system will become dysfunctional. 

I do agree that government should do things that it can do better or more efficiently than other entities or institutions.  We need to debate what this list is.  The problem classical liberals have with progressives and conservatives is that we believe your answers to this question are wrong.

Stuff like this is why I come here.