Saturday, October 20, 2012

Capitalism and the Self Made Man

So, we are now getting back to all the attacks on the self made man idea.  The attacks are just a softer version of "you didn't build that".  And, really, the discussion is maddeningly stupid.  Why?  Because the statements are all so vague and lacking in definition of terms that people are constantly talking past each other.  Let me explain what I mean.

Each one of us came into this world naked and helpless.  There is no other way to come into this world.  Each one of us was taken care of by someone, usually but not always our parents or other relatives until we could talk, walk, eat on our own.  No one who is a conservative contends that life is any different than that.

Each one of us was supported as a child by a network of adults and other kids.  We are social animals.  We were not raised by wolves in the forest.  And even wolves in the forest are social animals.  No one denies this.

And this is why the current political discussion has become so stupid.  Because the dispute between the right and the left is not about whether there is a social network and whether that social network is necessary for human development.  The dispute is about the appropriate and effective role of government in fostering, changing and affecting the social network.

Government is, of course, part of our social network.  What distinguishes it from many other parts of our network is that the majority of us have agreed to give what we call the government the right to coerce otheres, including ourselves through use of force, through imprisonment and through less physically forceful means like taxation and penalties and other physical restrictions which are, ultimately, backed up by the right we have given the government to literally put a gun to our head if we don't comply with its demands.

The near monopoly of the government on the right to use physical force to achieve its ends makes it different from every other part of our present social network here in the United States.  There are parts of the world still in which the ability of a tribe to simply shun one member is a force majeur because the environment is so hostile that the help of the tribe is needed to simply survive.  That is much less true here in the United States.  Here we have lots of loose tribes and families such that we can reach out and create our own circles of support through friendships and all the ways that people have traditionally been able to create functioning supportive groups.

We have churches and rotary clubs and hiking clubs and small businesses and large businesses and all of these are voluntary associations.  Heck, once you are an adult, your family is a voluntary association.

The question is what role should the government play in the social network.

So let's get back to the self made man.  I am not a fan of Ayn Rand and have never read more than a few snippets of her works and seen a few scenes from her movies.  So I can't really describe what she means by self made man, but I suspect, given the context of her writing, that she is talking about a man who created his own social networks to help him accomplish his goals without the help of a patron or sponsor or family wealth and connections or special government favors.

So, for example, it would be a person who wanted to build a building and went out and borrowed money from people in exchange for promises to repay and hired people who worked for him in exchange for his promises to pay them and purchased materials from others and so on.  Of course we need a social network to build a building.  No conservative would argue otherwise.  And most conservatives, pace Ayn Rand, think that the government should have some role in approving the plans to make sure that the building won't collapse on innocent people who enter it.

But conservatives think that role of government should be fairly limited.  Yeah, we need a building and safety department but its role should be limited to assuring that the building is structurally sound, it shouldn't be deciding if we need a building or what color it should be painted.  And it certainly shouldn't be taking taxpayer dollars to invest in a building intended for private use just because government bureacrats like the design.

I could go into a lot of detail about government's proper role, but suffice it to say at this point that there are certain enterprises like building airplanes and building buildings where the safety issues are sufficiently serious and where it is not cost effective for ordinary consumers to explore those safety issues on their own ( note that I did NOT say that they are not smart enough to do it, its just that they don't have the time and money to check out the safety of every building they enter or every plane they fly on.)  such that the most practical way to assure the safety of everyone is for the government to do it. Having said that I would point out that Consumer Reports and Underwriter's Laboratory are just two of the venerable institutions in our society  upon whom people rely to make recommendations about safety issues and that both are private enterprises.  The libertarians argue that if we did not have a government department of building and safety or an FAA some private organization would spring up to do the job and they may be correct.

So one liners like "you didn't build that" and descriptions like "self made man" simply don't capture what the real debate is.  If we want a debate that produces agreement and policy and is productive of positive change, then we need to talk about the real issue which is the appropriate role of government.  Conservatives believe that government should have a very small role in our social networks and that we should be free to make our own choices to a great extent.

Government certainly has a role in enforcing the rules.  One of the great strengths of our social structure is that we have a government that enforces the business like promises that people make to each other, or  as lawyers call it, the law of contracts.   We have laws that make people pay when they are negligent and cause physical harm to others and conservatives are somewhat in favor of that.  They think that the definition of negligence has slipped way too far and that businesses are being made to pay for harm that they did not really cause, but they do not want to do away with the tort system altogether.

Conservatives believe we need traffic laws and criminal laws and that people need to be able to feel physically safe and protected from other people who would physically attack them or steal their property.

And the devil, as people like to say, is in the details.  Generalizations deteriorate into meaningless slogans.  Conservatives are not opposed to the idea of taxes, for example, but they are opposed to taxes that are so high that they rob people of any incentive to work.  So it is silly to keep speaking in generalities.  Arthur Laffer, for example, believes that a tax rate over 30% tends to dissuade people from working and investing.  It is much more reasonable to look at the evidence of whether he is correct than to talk in generalities about tax rates.

Talking in generalities is like arguing about whether medicine as an idea is good. It's a silly discussion.  It makes a good deal more sense to talk about whether Cipro is the right medicine for a kidney infection.  That is a discussion worth having with someone.  People can actually learn from that discussion.

So the offensiveness of the "you didn't build that" statement coming from Obama is not that it recognizes that all of us are social creatures and benefit or are hurt by the social milieu in which we live and try to grow but in failing to recognize the importance of individual effort in realizing individual achievement.

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