Archive for March 31st, 2020

About three weeks ago, when the coronavirus crisis was becoming a big deal, I explained the libertarian viewpoint.

  1. Governments should focus on protecting life, liberty, and property. That includes fighting pandemics.
  2. A big sprawling federal government will be less capable and competent when responding to a real crisis.
  3. International evidence suggests greater government control of the health sector is not a good recipe for success.
  4. Domestic evidence indicates that bureaucracies such as the FDA and CDC are exacerbating the problem.

Unsurprisingly, there are still plenty of people claiming the crisis shows why libertarianism is impractical and misguided.

Henry Olsen opines for the Washington Post that the time has come to put libertarianism on the ash heap of history. But much of what he writes cries out for correction.

It is difficult to underestimate the influence of libertarian principles on Republican economic policy. Nearly every economist or economic journalist revered by the party advocates for policies that are derived from libertarian impulses. …Let people do what they want, the story goes, and they will cure poverty, bring world peace and do better at managing social discord than any centrally planned government act can ever hope to accomplish. …Pure libertarianism…is, of course, almost nonexistent in party circles… Even libertarian icons such as Sen. Rand Paul (R-Ky.) or Rep. Justin Amash (I-Mich.) publicly support much higher levels of government activity than do many of the thinkers and activists who sing their praises.

There are two huge problems with the above passages.

First, it’s nonsensical to claim that libertarians have a big influence on GOP economic policy. Just look at the mixed-to-horrible track records of Nixon, Bush I, Bush II, and Trump.

Ironically, Henry actually contradicts his own assertion by noting that libertarianism is “almost nonexistent in party circles.”

Second, what he’s really criticizing is the notion of limited government. Yes, libertarians believe in small government, but so do many conventional conservatives (remember Ronald Reagan?).

So is the notion of small government wrong? Henry argues that people want “strong government.”

Trump…grasps what they do not: People love freedom, but they love security as much or more. Time and again, people draw together in support of strong government to protect them from something fearful they cannot handle on their own. War and civil unrest are classic events that persuade people that strong mandatory measures are necessary; the current pandemic is another. …The modern social welfare state is grounded in the idea that some measure of economic security, opportunity and equality are necessary parts of a decent life. Policies designed to achieve these goals all impose on individual liberty through taxes and regulation. …a supermajority of Americans approves… They do not believe that liberty is the one true god before which all should bow. …The pandemic’s aftermath will see….conservatives…try to right this imbalance in the name of national security and general welfare, even if it means curtailing the liberty to trade. As the pandemic continues, it will be much easier for Republican voters and politicians to cast off the rose-colored libertarian glasses they have worn for far too long.

Let’s explore whether the notion of small government is inconsistent with the idea of strong government.

Writing for The Week, Bonnie Kristian explains how libertarian principles apply. Yes, government action is appropriate, but in ways that are consistent with other principles.

…pandemic-era libertarianism is emerging, and it remains distinctly libertarian. Here are the trends… Praise for the free market’s role in keeping day-to-day life functional. “That gallon jug of hand sanitizer delivered to your front door less than 48 hours after you ordered it online? It didn’t show up because Trump tweeted it into existence or because the surgeon general is driving a delivery truck around the country,” Reason‘s Eric Boehm wrote… Condemnation of counterproductive regulations and lack of transparency. Why is the United States so far behind other countries in testing for coronavirus cases? For weeks, the FDA and CDC wouldn’t let medical workers and academics move forward with COVID-19 tests they’d developed without lengthy processes of federal approval. …Rejection of corporate bailouts and price controls. Trump is exploring plans for corporate bailout loans and other economic stimuli which libertarians generally oppose. …Insistence on temporary changes. Fierce opposition to expansions of the surveillance state to fight the novel coronavirus is likely widespread among libertarians in no small part because privacy rights, once lost, are very rarely recovered. But the risk of this pandemic permanently expanding the power of the state will shape the libertarian view on every proposed solution.

These are solid principles. And very desirable.

Now let’s specifically address whether we need a “strong government.”

In a column for the National Interest, Andy Craig addresses that issue, most notably with his observation that responding to a pandemic is a legitimate exercise of government power, but also that government incompetence has worsened the crisis.

…there has been snark from some quarters about the current crisis somehow catching libertarians flat‐​footed. …Libertarianism, properly understood, encompasses certain core functions as the proper role of government. It is not the libertarian view that government should be ineffective at protecting individual rights or dysfunctionally paralyzed in the face of a massive threat to people’s lives. Government has a role to play in responding to the pandemic in much the same way it is the government’s job to prosecute murderers or defend the country from invasion. …Libertarian criticisms of bad regulations have proven especially prescient. A crucial government failure has been…inflexible and heavy‐​handed bureaucracy, which has held up tests and prevented thousands of private and academic labs from quickly increasing testing capacity. …Another example of a libertarian response to the pandemic has been the quick need to suspend many occupational licensing restrictions, such as by letting doctors practice interstate and upgrading the permissions of nurse practitioners and doctors’ assistants. Even mundane and trivial regulations…have suddenly been cast aside. Two months ago, who would have thought it an urgent concern to suspend alcohol regulations so that restaurants can serve beverages to go for home delivery by rideshare drivers?


I’ve documented (in Part I, Part II, and Part III) how big, blundering, bureaucratic government has hindered an effective response to the crisis.

Sadly, it’s quite likely that politicians will use the crisis to expand government power.

That’s certainly consistent with what we’ve seen through history. Professor Don Boudreaux of George Mason University has a new column about the insights of Robert Higgs.

…a book that I’ve lately been pondering quite a lot: economic historian Robert Higgs’s 1987 volume, Crisis and LeviathanIn this richly documented work, Higgs convincingly shows that with each national crisis government power ratchets up. The crisis might be fully genuine or inflated or utterly mythical; it matters not. Whenever there prevails widespread belief that a crisis looms, people turn to the state for help. …additional powers granted to – or seized by – government during each crisis shrinks somewhat when the crisis passes. …But never do such additions to state power fully disappear. …the likelihood is that the ideology of the holders of power prompts them, not to keep their power in check, but to expand it. And as power expands in a ratcheting-upward way, power becomes ever-more valuable and intoxicating to possess.

In a column for the U.K.-based CapX, Helen Dale discusses the role of a limited but competent state sector as a key to classical liberalism.

…liberalism needs a strong state. Yes, state. Not strong supranational organisations like the EU or UN or IMF. …Liberalism needs a state powerful enough to collect taxes and pay for police forces, courts, prisons, and the military. Only powerful states, it emerges, can strong-arm their citizens into the rule of law: that is, a system where like cases are treated alike, contracts are enforced…the modern nation-state is the only way to produce liberal tolerance at scale. …If liberalism needs a strong state, that state must also be a constrained one for liberal forms of governance to persist. Johnson and Koyama speak of a “shackled leviathan” rather than a “despotic leviathan”; that is, powerful states require institutional constraints because without them you get modern China or, historically, Nazi Germany and the USSR.

She’s highlighted a key issue, which is how you give government power to do good things without simultaneously giving it power to do bad things (hint: a good answer is the U.S. Constitution’s limits on the scope of government, at least back in the days when the Supreme Court cared about Article 1, Section 8).

Professor Michael Munger of Duke University makes the all-important point that a bloated public sector will be less competent at doing the few things we want from government.

I see the proper domain of the state as sharply circumscribed… Given that we have a state, it must have the capacity to carry out the functions… A key part of the justification for the existence of the state is the duty to manage property rights and institutions…the state needs to have sufficient capacity to protect individual rights… the key variable is the scope of government, not its size. A relatively small government that arbitrarily sets prices, nationalizes private property, and controls the media is the archetype of the authoritarian regime, as is the case in Turkmenistan or Chad. A large government that accepts constitutional and customary limits on its domain of action can be an archetype of personal freedom, as is the case in Denmark and Sweden. …The state needs the capacity to carry out public health functions, but those powers must be effectively limited to that domain, not available to be hijacked for socialist boondoggles. To my friends on the left: If you had been responsible enough to keep government in its proper, limited role we would have plenty of resources and capacity to carry out the functions we now find lacking. …We need a state that is good at a few things, not your state which tries to do everything and fails at all of it.

There’s lots of good stuff in the above excerpt, including the fact that fiscal policy is only a small piece of the puzzle when measuring the extent of free enterprise (which is why there’s far more economic liberty in, say, Denmark compared to every single country in the developing world).

The last sentence from the excerpt tells us everything we need to know. Indeed, a version of this insight is my Seventh Theorem of Government.

The bottom line is that we definitely don’t want big government.

What’s needed is not really “strong government,” but rather limited, competent, and effective government. Think Singapore, which does a much better job of providing core public goods while spending much less money.

As I noted when correcting Henry Olsen, this is not a libertarian-only principle. It also works for small-government conservatives, an important distinction since Singapore isn’t libertarian (high scores for economic freedom are offset by weak scores for personal freedom).

And I’ll close by observing that there’s plenty of academic and empirical literature supporting this Theorem.

Robert Samuelson and Mark Steyn have made the same point.

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