Tag: Anthony de Jasay

Review of Political Philosophy, Clearly in The Independent Review

The spring 2011 issue of The Independent Review features an excellent and informative review of Anthony de Jasay’s latest essay collection Political Philosophy, Clearly: Essays on Freedom And Fairness, Property And Equalities:

Denying that the emergence of order requires either a social contract or positive legislation, Jasay argues that baseline conventions securing social order can, in principle, be self-enforcing…The state is thus inessential…Jasay seeks consistently to avoid reliance on the nondescriptive and nonascertainable. He opts for something like Hume’s noncognitivist reading of foundational moral judgments as embodying reactive attitudes rather than truth-evaluable propositions.

In the case of such a sharp thinker as Anthony de Jasay, it is interesting to see which parts of Jasay’s oeuvre are identified as vulnerable by reviewers. This reviewer, Gary Chartier, questions his (seemingly) unproblematic acceptance of patent protection. From Jasay’s own framework this may indeed be problematic because patent protections “are precisely not the products of convention, but rather legislative enactments that constrain people’s use of just the sorts of property to which stable conventions might be thought to entitle them.”

As far as I am aware, Jasay has not treated the topic of intellectual property in much detail, and it would be interesting to see more attention to this topic in relation to his other views, in particular his views about the use and abuse of utilitarian and free-rider arguments.

The high road to coercion: public goods and forced unionism

There is a striking parallel between the argument in favor of forcing people to contribute to public goods and forced unionism. In both cases, it is argued that only forced contributions will ensure that people who benefit from public goods and collective bargaining pay their “fair share.” Of course, this argument simply assumes that all people who are forced to contribute to the government and labor unions want and appreciate those benefits – which is simply incorrect.

Since it is perceived too costly and impractical to distinguish between sincere opponents and free riders, this distinction is lost in practical politics and labor disputes. In reality, tax payers and employees of unionized organizations are simply treated as “blocks of people” where objections of individuals do not really matter. To sweep individual consent so easily under the carpet is one of the defining characteristics of governments and labor unions.

In his seminal work on private provision of public goods, Social Contract, Free Ride, Anthony de Jasay writes:

“The high road to coercion is the contractarian pretension that acceptance by a person of a share in a benefit he did not solicit is tantamount to his tacit acceptance of an obligation to provide a share of the corresponding contribution in the same way as those who did solicit the benefit.”

In this book Jasay also argues quite persuasively that the prohibition on free riding that is sought in collective good arguments will be undermined by the fact that governments  in turn generate the most formidable opportunities for free riding and parasitism by allowing voters to enrich themselves at the expense of (other) taxpayers.

Advocates of collective bargaining for public sector unions claim that collective bargaining is a “right” or “human right.” It is not clear what is being meant by “right” in this context because one cannot claim a right of this nature without assuming a corresponding obligation of others (companies, governments) to negotiate with you. In the case of public sector labor unions the nature of this presumed right is even more contestable because government employees are not bargaining for a share of the profits of a private company but for taxpayer money. Public sector union members  basically expect taxpayers to refrain from efforts to protect their own money and freedom of choice so that government employees can enjoy more generous compensation and benefits.

There is an ongoing debate about the question of whether public employees are overpaid or underpaid. Compensation in the private sector is, absent government intervention, governed by supply and demand. Compensation in the public sector is governed by supply and demand and majority rule. The role of coercion in paying government employees simply excludes a rigorous test of what these employees are worth to the taxpayer. Education is also a poor proxy for compensation of public employees because, as the growing education bubble makes clear, companies that are operating in a competitive environment are not going to pay an employee for their educational degrees as such. That governments do often pay high salaries to people with degrees that are not held in high esteem in the private sector reinforces the unhealthy relationship between publicly-funded education and government.

A positive-sum game against nature

Whenever there is a major economic event (a rapid decline of stock prices, a spike in the price of oil, high unemployment, etc.) the media can be counted on to feature a person who was predicting these events all along. This should not be surprising because there are so many professional economists and commentators who cannot restrain themselves from making economic predictions that a few of them will turn out to be correct. But what is surprising is that so few journalists seem to be able to distinguish between skill and luck. This is one of the major themes of Nassim Nicholas Taleb’s seminal Fooled by Randomness: The Hidden Role of Chance in the Markets and in Life.

If you are an obscure, but aspiring, economist, what are your options? In the June 2009 issue of The Freeman, Anthony de Jasay writes (p.33-34):

What is left for the 250,000 other, less-distinguished economists to do to gain fame and fortune? They too can offer forecasts and might put them on some record. If they place them in the cluster and the actual outcome is in the cluster, they remain unremarked and neither gain nor lose anything. If they go way outside the cluster and the outcome is in the cluster, nobody will remember the wrong forecast made a year earlier. They will again gain nothing and lose nothing. If their forecast is in the cluster and the actual outcome is way outside it, they will be in the good company of their 500 more-distinguished fellows and will again remain unremarked.

The rational choice for such an undistinguished economist is to make extreme predictions, corroborated with pessimistic scenarios that make such forecasts plausible.  If the economist is wrong, nothing (or little) is lost; if he is right, great publicity and riches can be expected. In technical terms, “he has access to a positive-sum game against nature.” On a more serious note, Jasay writes that “such forecasts are the best method of deepening the gloom, frightening the credulous, and making the worst more probable.”

Pattern junkies and the financial meltdown

In an opinion piece for Forbes, legal scholar Richard A. Epstein draws attention to the political philosophical aspects of the financial meltdown:

Fannie and Freddie didn’t design their horrific lending policies by chance. No, behind this lending fiasco lay the strong collective preference for the “patterned principles” of justice that Robert Nozick attacked so powerfully in his 1974 masterpiece, Anarchy, State, and Utopia.

Public policy makers attribute goals to society and look at its institutions, and ultimately people, as means to produce them. Such a teleological mindset stands in strong contrast to “historical principles of justice, which are content to establish the rules of the game and then let the legal moves by individual players determine the social outcomes.”

Whether “fairness” in the mortgage market or the creation of an “ownership society” is the goal, the underlying premise of society as collective enterprise towards “shared” goals is bound to create winners and losers and unintended consequences (which require additional interventions and so forth).

Epstein’s characterization of Congress as a  “pattern junkie” is very much to the point because, as a general rule, politicians cannot resist the siren song of using the coercive power of the state to overturn contract and spontaneous cooperation. As Anthony de Jasay points out in his treatise on political power The State, not intervening would require that the state has ends that lie beyond politics:

It seems anomalous if not self-contradictory for the state both to have a will and to want to minimize itself. For this to be rational, its ends must lie beyond politics, and be unattainable through governing.

Common political fallacies

In Cato Journal, Volume 28, No. 1 (Winter 2008), the independent scholar Anthony de Jasay reviews four common fallacies (as presented in the works of John Stuart Mill, Ronald Dworkin, John Rawls, and Armen Alchian) that many social scientists and political journalists keep repeating without rigorous analysis.

The first fallacy is that production should be governed by the laws of economics, but that distribution needs to be decided by society. As de Jasay points out,

“Output is distributed while it is produced. Wage earners get some of it as wages in exchange for their efforts; owners of capital get some of it as interest and rent in exchange for past saving. Entrepreneurs get the residual as profit in exchange for organization and risk bearing. By the time the cake is “baked,” it is also sliced and those who played a part in baking it have all got their slices. No distributive decision is missing, left over for “society” to take.”

Although these slices can be distributed again by society, this will constitute a secondary redistribution, usually involving coercion.

The second fallacy is that the aim of public policy should not be equality of outcomes, but equality of opportunity. Such “equality at the starting gate” assumes that equality of opportunity and equality of outcome can be separated. But unless opportunities are equalized at the point where acquired advantages are at a minimum (at birth), maximizing equality of opportunity would require stripping away the advantages people have acquired before the starting gate, and continuous intervention in outcomes to equalize opportunities between generations.

The third fallacy is that in a just society individuals must have a right to the greatest possible liberty compatible with the same liberty for all. As de Jasay has pointed out in detail in his writings, the proviso “compatible with the same for others” is meaningless because it is without substance. In its current form it means that I am at liberty to do anything I want (including violence and theft), provided others have the same liberty as well. Clearly, this is not what advocates of this position intended. More troubling to de Jasay is the fact that liberty is presented as a “right”:

“What is deeply worrying about this thoughtless misuse of the word “right” is that it can be straightened out at a single stroke by simply assuming that every feasible act is prohibited unless we are somehow granted a “right” to perform it, in which case it becomes a liberty. It takes a right to lift it out of the universe of prohibitions.”

The fourth fallacy is that society has a right to modify, transfer and revoke property because property rights are granted and defended by “society.” As has been discussed in the first fallacy about production and distribution, redistributing property would be tantamount to ignoring the fact that all who have helped to produce property have already been remunerated in the process. As in the case of a “right to liberty”, the “right to” part is redundant:

“Like all liberties, the kind we call property exists and is exercised within the rules that prohibit certain wrongs (torts). Staying as it does inside the rules, it needs no separate right to exist and be exercised. Nor does it make sense to think of an obligation imposed on all not to do against property what the rules prohibit them from doing anyway.”

Anthony de Jasay: Parrot Talk: The Repetition of Common Fallacies (PDF)