Elites, but with Checks and Turnover, 3/16
Some thoughts on state-capacity libertarianism
Which decisions should be made in the private sector, and which decisions should be made by governing elites? From a consequentialist point of view, I lean toward the private sector, for the following reasons:
Individuals and managers of firms know more about their particular circumstances than do distant officials.
Individuals and managers of firms have skin in the game, which motivates them to conduct potentially valuable experiments.
When individuals and managers of firms make mistakes, they tend to receive feedback that drives them to change or, in the case of firms, to go out of business.
Individual freedom and autonomy are good in and of themselves.
But we live in a complex, highly interdependent society that gives rise to many sorts of conflicts. We cannot wish away the need for governance. Note that governance can be provided by organizations, such as Underwriters Laboratories or the Financial Accounting Standards Board, that are not made up of public officials.
I believe that the United States has become too democratic. The gradual expansion of the right to vote has worsened the quality of those elected to office. The voting public is a collection of FOOLs (Fear Of Others’ Liberty). Voters constantly fall for demagogic exaggerations of danger. The result is a government that is way too large, intrusive, and incompetent.
Any hope that the Internet would produce a better informed democracy has been dashed. Twitter is America’s version of Pravda, but with propaganda provided from the bottom up.
We need governance for our highly interdependent society. But the form that governance has taken is one that relies on independent regulatory agencies. I think we should try to restructure government to account for the regulatory state, as described in my essay.
Decisions made by the regulatory state are best made by experts. But they should take seriously the propositions that I listed above.
When we think of elites, their arrogance is something that, sadly, we take for granted. Instead of elites who pay attention to my four propositions, we get people who manufacture excuses to order the rest of us around.
But the American founders were not like that. They instead were concerned with how to diffuse power. We need elites that are anti-elitist, inclined to respect the judgment of private individuals. Regulation should resolve difficult conflicts, not make nudges or give unwarranted commands.
Because the founders were skeptical about power, the Constitution was written to set boundaries for government. It also included checks and balances to try to make ambitious individuals in one branch of government opposed to power grabs by ambitious individuals in other branches. Unfortunately, the consequence of giving more people the right to vote has been to create a constituency for erasing the boundaries and knocking down the guardrails that the Constitution tries to construct. The response to modern challenges has been to adopt a regulatory state that overrides checks and balances.
I think that elites should be subject to checks. In the context of the regulatory state, I emphasize the function of a Chief Auditor as a way to try to introduce a new form of checks.
Another concern that I have is the need for turnover. When agencies perpetuate themselves, there is little chance for new thinking to emerge. In government, we need to find a way to balance the advantage of institutional knowledge with the adverse consequences of thinking that becomes stale and rigid.
But most of all, we need an overall political culture that does not suffer from excessive faith in central government. Too many well-educated people believe that credentialed experts have all the answers. And too many anti-elitists believe that popular opinion provides all the answers. Skepticism, epistemic humility, and appreciation of my four propositions are all too rare.
"Twitter is America’s version of Pravda, but with propaganda provided from the bottom up."
This continues to be a blind spot for you and a lot of others that I respect. The propaganda isn't coming from the bottom up- it only looks that way because it serves the purposes of those in power for it to do so.
People conflate governance with Government and so it goes, if you don’t have the latter you cannot have the former… therefore chaos. Those rooting for Government are those in it or its cronies. But our early societies emerged under governance (Common Law, moral code, custom, tradition etiquette, interdependence through voluntary exchange) with no centralised Government.
As for the Founding Fathers: they were certainly well informed and thoughtful, but were confounded by their conceit thinking they could write it all down in an elegant document as proof against those who in future would seek power and control and abuse it. They needed only have looked to Magna Carta which King John started to ignore before the ink was dry as did subsequent Plantagenet Kings of England requiring revised charters to be written and signed at the insistance of the Barons of the day. Its wholesale disregard finally resulted in dynastic war. Today not a scrap of it remains in the British Constitution.
Universal suffrage inevitably meant those seeking election/re-election would treat tax revenues as a slush fund to bribe voters; voters soon realised this and elections have become auctions where they sell their votes to the highest bidder. Tax revenues are mostly used for bribery than for delivering public goods efficiently - not that Government is capable of efficiency anyway.
We do need to move provision of public goods into the competitive private sector paid for directly by their consumers with the concomitant reduction in taxation. “The Machinery of Freedom: Guide to Radical Capitalism” by David Friedman explores this transition and is a thought-provoking read.