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Weekend reflections

December 16th, 2006

Weekend Reflections is on again. Please comment on any topic of interest (civilised discussion and no coarse language, please). Feel free to put in contributions more lengthy than for the Monday Message Board or standard comments.

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  1. December 16th, 2006 at 09:13 | #1

    Nicholas Gruen at Troppo has an interesting piece on the quirks of the non-left commentatiat and the way some of them have turned on their former comrades. http://www.clubtroppo.com.au/2006/12/15/conservatives-and-marxists/

    This is a topic that I addressed a while back when people were wondering what the non-left would do after the Fall of the Wall vindicated their position and they had to find some other cause to maintain solidarity. http://www.the-rathouse.com/hayuniting.html

    As the spiritual and intellectual debacle of socialism becomes increasingly obvious to everyone outside the ranks of Western intellectuals, there are signs of increasing tension between various non-socialist schools of thought. For example the IPA Review during 1988 reported a survey of six liberal or conservative columnists on a wide range of issues which yielded unanimous agreement on only three items.

    If these tensions reflect fundamental differences, then the groupings of the ‘non-left’ may fragment into warring factions. No doubt some differences arise from misunderstandings which can be resolved, and some simply reflect the different priorities and interests of individuals. Significant differences are likely to arise in two areas: a) the use of state power to enforce moral principles and b) the domain of economic policy. In each case the nub of the issue is the extent of state intervention that is appropriate.

    Greg Sheridan provided a useful point of departure in considering these issues when he described three strands of right-wing thought and floated the idea of a merger. In The Weekend Australian (July 12, 1986), he pondered the prospect of some masterly theorist effecting a ‘dazzling synthesis’ of market liberalism, cultural conservatism and the thoughts of BA Santamaria.

    He associated market liberalism with the free-enterprise think tanks, such as the Centre of Independent Studies. The conservatives tend to be involved with Quadrant, the Association for Cultural Freedom and perhaps the Institute for Public Affairs. Santamaria does not fit comfortably with either of those groups though he has points of contact with both. He operates in a tradition of Roman Catholic thought which includes Hilaire Belloc and is equally suspicious of capitalism and communism. (This was first written in 1986, Santamaria is no longer a living presence in this debate).

    The synthesis that Sheridan wants to see would combine the economic rigour of the market liberals, with religious and spiritual inspiration, both tempered by the prudence of the conservative. In Sheridan’s opinion, the economic rationality of the market liberals is too narrow in its focus and it lacks moral, cultural and spiritual depth, a view which is often expressed in the comment that economists know the price of everything and the value of nothing. Against this it can be argued that the classical liberal tradition, epitomised by F A Hayek and Karl Popper is not vulnerable to the charge of narrowness. Indeed, much of the work for the dazzling synthesis has been done by Hayek, senior member of the Austrian school of liberal economists.

    Market liberalism aims to protect the private domain of the individual and small groups – including the family – Burke’s ‘little platoons’. This domain is at risk from the hostile activities of individuals and groups who are liable to use brute force or other political means of coercion if they are not kept under control by institutional constraints, a strong liberal tradition and the Rule of Law. In the protected private domain all manner of spiritual and cultural traditions and practices can be nurtured but the barbarism of unchecked power is likely to sweep these things away or else corrupt them by recruiting them to its own purposes, as when Christianity became the official religion of Rome.

    Some economic rationalists may need to be reminded that we do not live by bread and technology alone. Our lives gain meaning and purpose from the myths and traditions which constitute our non-material heritage. At a lower but no less important level our daily transactions are dignified and lubricated by civility and good manners. Both the higher and lower orders of this fragile structure of civilisation are perpetuated by cultural practices and by institutions such as the family and the universities. These, like the private domain itself, are under threat from various doctrines and schools of thought that are also part of intellectual heritage. If we lose the capacity to subject our tradition heritage to imaginative criticism we run the risk that the positive tendencies will be driven out by the negatives. Some would say that this process is well advanced.

    Economic liberals may sometimes appear to have little interest in these spiritual and cultural matters but this is not entirely true and the impression arises from three reasons. First, it is not possible to talk usefully about every social problem at once and economists tend to talk most about the things they know best. Second, they do not speak with one voice on such matters. Third, they do not see these things as part of the agenda of state policy. Here a basic principle is at stake because they do not aim to impose religious or cultural values, instead they wish to sustain ‘a type of order in which, even on issues which to one are fundamental, others are allowed to pursue different ends’, as Hayek put it.

    The Rule of Law is a principle that conservatives might be expected to hold dear. But Hayek drew attention to ‘the characteristic complacency of the conservative toward the action of established authority and his prime concern that this authority be not weakened rather than that its power be kept within bounds. This is difficult to reconcile with the preservation of liberty’. Some conservatives tend to share with socialists a willingness to recruit the power of the state to coerce others where the liberal would allow freedom of choice. Conscription for military service (by the Liberal Coalition Government in Australia) was a case in point and retrospective legislation on tax avoidance was a notable example of the Rule of Law being flouted by another ‘Liberal’ government.

  2. Mike Hart
    December 16th, 2006 at 14:50 | #2

    Well it will be interesting to see where to from here with the Mangy Roo having gone to the private equity barons. I am not sure where they consider the value the ascribe to Qantas in the price per share and I have read all sorts of fanciful explanations as to value to be explored vis a vis the asset being undervalued, well now they have paid a premium where will the savings come from? There is not much left to flog off in the way of assets. Pity the financial hacks reporting on the marvellous brand had not taken the time to really explore the history of Qantas and how it ended up in government hands in the first place. In short a huge investment into a industry in it’s tertiary stage, a slowly increasing fleet complexity (they will be up to 5 or 6 different types before long) and the spectre of the continuing rise in the price of their biggest costs fuel. The more I look at this deal the more it looks like the enthusiastic expansion the Ables undertook with Ansett is in the wind, the results will be the same. Five years max before the Mangy Roo is bust. I will weep no tears and finally Qantas will have to compete out from behind the shelter of government protection. Virgin, Singapore and Emirates probably cannot believe their luck.

  3. Hermit
    December 16th, 2006 at 17:57 | #3

    Dr Nelson seems to have shelved his Hippocratic oath for the meanwhile to welcome the maiden flight of the Joint Strike Fighter, a snip at $A160m apiece. I’m envisioning some kind of Battle of Britain dogfight ‘Aussies versus Al Qaeda’ but I think simple accidents are more likely. By way of contrast I googled Erickson Aircrane helicopters and I gather these proven firefighting tools that save lives are priced around $US15m each. Thus one JSF would buy enough aerial firefighting for the whole country instead we are going to buy dozens of fighters (deposit already paid) and hire the helicopters every summer.

    Since supersonic aircraft are a bit over the top for the Fiji coup plotters I wonder if Howard envisions their use in the northern hemisphere to help out George Bush or his successors. I see GWB has already rejected the recommendations of the Baker committee and will increase military effort in Iraq. Perhaps a call to Kirribilli ended with ‘we’ll support you all the way mate’.

  4. Marcella
    December 16th, 2006 at 23:27 | #4

    Rafe, please; did Quadrant forget your subscription ? “market liberalism… aims to protect… small groups (?)… including the family” WTF.

    ‘Your’ synthesis of market liberalism with the ‘spiritual and cultural’ was well realised with the neo-cons in Amerikkka… so what are you pushing ?

    “As the spiritual and intellectual debacle of socialism(?) becomes increasingly obvious to everyone outside the ranks of Western intellectuals(?)…”

    If by socialism you mean: ‘state intervention’(or heavens forbid: citizenry input) as opposed to ‘virtual parliamentary’ control over decision and policy formation then well; hey, mass-movements finding outlet in left-centrist governments in Latin America seem to beg to differ with your postulation…

    Look, I do not normally respond to such posts but, come on, that post is asking for it.

  5. observa
    December 17th, 2006 at 05:39 | #5

    Hermit, you could of course cancel all your insurance (house, car, life???)and plonk it all into your super fund. It is one strategy in an uncertain world. You are quite right that experiences as diverse as Iraq, Afghanistan, ET, Solomons, Fiji, etc may have enlightened one as to the futility of trying to bring civilised Anglo Saxon ways to areas where there is a strong negative correlation with elected Anglo Saxons. You may wish to shrug your shoulders and say each to his own, until some each decides your own deserve to die, in which case a state of the art JSF might be used to take out an Abu Bakr Bashir as a reminder that they can’t get away with that sort of thinking and action. The strong arm of the law in this case, always needs to be stronger than that of the villains naturally.

  6. observa
    December 17th, 2006 at 06:49 | #6

    Unfortunately Rafe, the price of freedom is eternal vigilance and the communards are gathering afresh again in Mordor. This time under the banner of GW, with their evil eye on the quantity control levers of industry and individual endeavour once more. It will require a strong Fellowship of the Ring once again, to defeat their evil, lying ways.
    Firstly we all need to understand that they are lying about what GW means. If not overtly lying they are deliberately lying by omission. Take Mike Rann and his Govt in SA. He has only just passed legislation mandating GG reductions of 60% of 1990 levels by 2050. (apparently as one of only 3 jurisdictions in the world to do so) Abracadabra, all our problems solved, except for a report on the front page of yesterday’s Advertiser (16/12/06)

    “Electricity generators have warned Premier Mike Rann’s Climate Change Team that plans to cut emissions by by 60% of 1990 levels by 2050 will trhreaten electricity supplies and drive up prices for consumers.

    The Energy Supply Association of Australia which represents coal, gas, wind and solar generators, predicts national electricity demand will grow by more than 65% by 2030.

    This will require generators producing an extra 30,000 MW which are likely to cost $35 bill-even without emission controls or increased renewable energy targets adding to this cost.

    The ESAA study to be released early next year finds that cutting greenhouse emissions by 30% from 2000 levels by 2030 would add another $35 bill to $40 bill to this cost.

    Alternative energy such as wind and solar alone cannot produce enough electricity to meet the rising demand, generators and planning authorities argue, meaning that more GG emitting coal or gas-fired power plants will be needed in the national electricity market.”

    Yes the ESAA is saying what the likes of Mike Rann and John Quiggin are not saying. Did I recall JQ here saying that to tackle GW we would only have to give up a percentage point or two of economic growth? Where on earth do these left fantasists get off? (60% reductions of 1990 levels by 2050 remember folks!!!) It’s time to call these people for their obtuseness or deliberate lies and I have a strong feeling it’s the latter. Industry is beginning to call them on it.

  7. observa
    December 17th, 2006 at 07:05 | #7

    Oh and a typical sample of the communard threat from Mordor
    http://politics.guardian.co.uk/green/story/0,,1969164,00.html

  8. gordon
    December 17th, 2006 at 10:16 | #8

    Brad Setser links to an interesting account of dollar/euro/yen manoevrings by oil producers by the Fin. Times

  9. gordon
    December 17th, 2006 at 10:20 | #9

    Yes, Observa, Mordor has been working overtime on designing a non-emitting, ecofriendly, sustainable Molotov Cocktail for years now. HaHaHaHaHaHa!

  10. Hermit
    December 17th, 2006 at 11:06 | #10

    Observa
    you’ve raised one of my other hobby horses; the economic woes of South Australia. A tiny detail that Rann overlooks is the fact Olympic Dam (Roxby Downs) is by far the world’s largest uranium deposit. The mine needs a coastal desalination plant in order to expand. Why not have a nuclear reactor generating low carbon electricity, fresh water for the mine and surplus water for the rest of the state? At the same time throw in nuclear waste disposal and perhaps enrichment if the technology becomes affordable. As a bonus the mining machinery could run on nuclear electricity so the indirect carbon is lowered also. What SA Saudi Arabia is (or was) to oil SA South Australia could be to reducing not local but global greenhouse emissions. When car manufacturing and wine making fall in a heap crow eaters will realise Rann is holding them back.

  11. observa
    December 17th, 2006 at 13:48 | #11

    “Why not have a nuclear reactor generating low carbon electricity, fresh water for the mine and surplus water for the rest of the state?”
    Why not indeed! Instead we have a total dickhead who wants us to believe in fairy stories that reducing GG by 60%(of 1990 levels would you believe?)would not have a similar corresponding impact on our standard of living. What the hell are national media doing, letting these dickheads get away with motherhood statements like that? It’s high time idiots who believe this crap, as well as it’s OK to mine and flog uranium for others to use (Rudd and Co), are called to account by our media for it. They’re getting a free ride at present. If you belive in GW the simple facts are these- Our lifestle, as distinct from that of our grandparents and the third world is largely predicated upon the use of fossil fuels at present. To cut that lifestyle by 60% you have to have a bloody good reason to do so. GW could well be that very reason EXCEPT, if by reducing our GG emissions by 50%, a country like China simply ate that up in 4 and a half months as they are currently doing with increasing coal fired power stations, then what’s the bloody point? It was called cutting of your nose to spite your face in my day. Short of some amazing international UN Big Brother solution, we may as well let market forces sort it all out in the long run and learn to cope with the changes, the same as we would with an impending Ice Age.

  12. observa
    December 17th, 2006 at 13:54 | #12

    Mind you, would anyone care to argue here that in the absence of nuclear energy, a 60% fall in GG emissions would not require a fairly similar quantum fall in consumption/living standards? I’m all ears.

  13. December 18th, 2006 at 15:43 | #13

    Perhaps people can enlighten me: is there an accepted way to do benefit-cost analysis on life-saving public works such as road spending and public health? Are there any BCA comparisons of policies and programs that balance lives and injuries against cost, rather than against profit?

  14. December 18th, 2006 at 22:28 | #14

    Hello Marcella, thanks for your comments!

    I think we may have a different perception on market liberalism and I am not clear about your precise objections to the three prongs of policy that I think are important:

    1. Free trade and a range of other freedoms – speeech, association, belief etc.
    2. The rule of law (due process, property rights etc).
    3. A robust moral framework including honesty, compassion, enterprise, community service.

    As for the movements in Latin America that you mention, it remains to be seen if they put in place the kind of policies that work for the benefit of the people, or just another set of exploitive thugs.

    It seems that the debacle of socialism has become apparent to Kevin Rudd.

    It seems odd to equate socialism with citizen input because the socialist regimes that we know about have a very bad record on human rights.

  15. Katz
    December 19th, 2006 at 07:58 | #15

    Rafe:

    “1. Free trade and a range of other freedoms – speeech, association, belief etc.
    “2. The rule of law (due process, property rights etc).
    “3. A robust moral framework including honesty, compassion, enterprise, community service.”

    I don’t know whether you have accidentally listed these criteria in this way. But upon consideration I think that you will agree that No. 3 sets the necessary conditions for the other two to exist.

    Now this is no mere quibble. It would appear that the ethical framework (I prefer the word “ethical” to “moral”) that encourages respect for (private) property rights and for that entirely admirable list of enlightenment principles you refer to has historically by no means has been universal. Indeed, the invention of your enlightenment principles was one conseqences of the fratricidal Wars of Religion in Europe in the 17th century, when traditional, Christian frameworks of social ethics fell into deep disrepute.

    No other traditional framework of ethics has endured the same intensity of baleful internal scrutiny as 17th and 18th century Christianity.

    Subsequently, the ideas of the Enlightenment have been imposed on the non-Christian world, with more or less success, by the sword.

    Folks who don’t see a pressing need to change traditional ways tend to get angry at other folks who insist that new ways are best for them.

    This was the case in Europe, which experienced several White Reactions against Enlightenment thinking during the 18th, 19th and 20th centuries.

    And this is very decidedly the case in the present-day Islamic world.

    It’s a very ticklish thing to do to invade a country with the purpose of telling its inhabitants that its ethical framework is all wrong.

  16. December 19th, 2006 at 08:32 | #16

    Good points Katz, I am more than happy to put the ethical principles up front but I am not committed to any particular order, it is a bit like a three-legged stool that needs all three legs.

  17. Katz
    December 20th, 2006 at 08:55 | #17

    Rafe, no doubt a stool need three legs to stand up. (I quite like that coincidence between a physical fact and an abstract political theory.)

    But my central point is that the appropriate ethical framework necessarily precedes the other two. My point is a diachronic one, as opposed to synchronic.

  18. December 20th, 2006 at 19:12 | #18

    Katz, the people in Europe who were angry at change being thrust on them fell into a number of entirely rational categories, e.g.:-

    - People who knew that they were going to lose in any meaningful time scale, whatever the ultimate general benefit to others or even their own descendants. These included Luddites and evictees, inter alia. See John Barnes’s essay “Two Cheers for Ned Ludd”.

    - People who knew that they were having a huge risk thrust upon them, almost literally the equivalent of betting the farm. This included some of “Turnip” Townsend’s tenants who had to carry out his experiments with new crops. They were at least alive before the experiments, but they risked ruin if turnips hadn’t worked out – a much greater risk than Townsend took.

    - People who disliked being nagged; even if the changes could work out, they didn’t like being pressured to innovate by people who didn’t have a stake in it.

    This in fact connects to the Cerulo piece. By coincidence, temperate North America has for many generations been a favourable place for taking risks; it was usually possible to start over after failing, since the available natural resources did make it a land of opportunity.

    On the other hand, in other parts of the world it was only ever safe to proceed cautiously and incrementally, since for so long absolute ruin was so near at hand. The only exceptions were when you took risks at other people’s expense. Naturally, there was always suspicion of people recommending change, since there was a chance that they had a hidden interest of this sort – a bit like Damon Runyon’s “The Lemon Drop Kid”, without the trouble that that character hit.

  19. Katz
    December 20th, 2006 at 22:58 | #19

    I agree PML.

    People with power find it much easier to impose “rationality” on other people’s lives than on their own.

    Most ordinary peasants (who were the majority of the inhabitants of Europe in the 17th and 18th centuries had grievances with pre-captalist systems. But when capitalist principles ere unleashed upon them they were often very angry.

    Nevertheless, it is important to acknowledge that capitalist principles have become more thoroughly entrenched in popular ethical schemes in Europe and its settler-colonial offshoots than in any other parts of the world.

    I’d b a bit dubious of a climatological determinist explanation for this.

  20. December 21st, 2006 at 05:05 | #20

    Interesting Katz! It depends what you mean by “capitalist principles”. What is the problem with free trade under the rule of law that would make people angry (apart from monopolists or people with special privileges to exploit other people)?

  21. Katz
    December 21st, 2006 at 06:09 | #21

    “What is the problem with free trade under the rule of law that would make people angry (apart from monopolists or people with special privileges to exploit other people)?”

    To be capable of framing this question you need to be imbued thoroughly with a set of ethical principles supportive of capitalism.

    It would take an anthropologist to produce a taxonomy of world wiews that are hostile to these propositions. Suffice to say that for most of history almost every living human being has held views that were and are hostile to your principles.

    Some at more or less random:

    Australian conservative governments ramped up high tariffs against non-British imports on the proposition that this would help both British industry and Australian consumers.

    The EU Common Agricultural Policy is based on the proposition that a European farm is only incidentally an economic unit.

    US agricultural policy is also infected with this nostalgia.

    In Australia, Britain and the United States the rule of law as it has long been understood is under more determined attack from the Executive in the history of the United States and Australia and since the Star Chamber in 17th-century Britain.

    Now, I don’t mean to pick on the Anglosphere. It just happens to be what I know best. And these countries came closer to evolving an ethos supportive of capitalism than any others.

    Elsewhere, race, religion, tribe, notions of the sacred, honour, inalienability of property prohibit much free trade and virtually all notions of equal rights under the law.

  22. December 21st, 2006 at 14:28 | #22

    “What is the problem with free trade under the rule of law that would make people angry”

    It’s a good hypothetical, and for the sake of the argument, if free trade were to be established here for example, there’d be no Australian auto industry; no Australian airlines; no Australian newspapers; no Australian TV stations; no PBS or Medicare; no etc.

    It’s not difficult to then imagine the type of person (tiresomely unenlightened, admittedly) that would become unhappy.

  23. December 21st, 2006 at 20:26 | #23

    Thanks again Katz, but you have not quite answered the question which was to identify problems that would arise as a consequence of free trade, or a move towards more free trade.

    It is generally accepted that the nations of the Third World are improving their situation in proportion to the lowering of external trade barriers and internal constraints on trade.

    wbb, did we have to have our auto industry if it meant more expensive cars? more expensive air fares? And why do you think we would have no Australian newspapers or TV stations without protection?

  24. Katz
    December 21st, 2006 at 20:44 | #24

    Rafe,

    You are arguing about consequences. Whereas the argument so far, at least so far as I am concerned, is about causes.

    What you say about the benefits of liberalisation may be correct.

    However, the argument you make is at cross-purposes to the point I’m trying to make.

    It is clear that your arguments have not convinced most of the governments of most of the world. And many of those governments are anti-globalist at least to some degree with the active or passive consent of their people.

    The liberalisation that has taken place in most of the world has been the direct or indirect result of coercion at some stage in the history of those nations. Think about the Opium Wars as a infamous example.

    In other words, the mass of inhabitants of these nations have not been convinced of the benefits of liberalisation. Where it exists it has often been foisted on the people against their wishes.

  25. December 21st, 2006 at 22:42 | #25

    Katz, I wouldn’t suggest that North America enjoyed natural resource advantages from geography and/or climate, but from something else that might be confused with that.

    North America was settled from that part of Europe with sufficently similar conditions that – after some travails – European techniques could be adapted to it. These flourished better there because Europe had already committed its easiest and most cost effective resources – in that era.

    Of course, technologies changed in ways that brought other European resources on stream, ones that had not hitherto been tapped so much. But that was after the formative phase of North American culture, and was also applicable there.

  26. December 22nd, 2006 at 09:20 | #26

    It seems that Katz and I are at cross purposes and I am happy to agree that the historical record shows a lot of ups and downs in the fortunes of the liberal agenda of free trade, rule of law etc. No doubt much can be learned from the record however just at the moment I would like to focus on the policies and reforms that people of good will should support.

    It seems that Katz agrees that the liberal agenda as I have described it is a good thing. If this is indeed the case then we both need to press on and explain in the clearest possible terms why this is so with the hope that governments will be under pressure from the voters to do the right things.

  27. December 27th, 2006 at 20:24 | #27

    a lot of discussion above, with no visible concern for the interaction of big ideas with garden variety human beings.

    when free trade exported blue collar jobs, the middle class got cheap electronics and better cars. they were happier. free trade was clearly a good thing. wasn’t it? absolutely, said academics and international trading companies. a lot of middle aged blue collar workers found themselves suddenly on the dole, and unemployable. but that didn’t matter, they didn’t have access to learned journals or op-ed space and so were nearly invisible. so yes, everyone was happy. everyone that mattered.

    if you don’t have a plan to integrate all of societies people in the workforce in a way that allows all a decent life for the lowest paid, then you are designing a brutal society that must be held together by force. as more and more people are made redundant to expanding imports of goods and services, more force must be applied. the champion of this process is the united states, whose income distribution is more skewed than the south american banana dictatorships that used to excite contempt,50 years ago. it’s no accident that they spend more public money on prisons than any other country, more money on armaments than the rest of the world, combined.

    capitalism doesn’t have a plan. it’s just a label for the ‘law of the jungle’ now that the jungle of mankind’s beginning has been transmuted to human society. capitalists hire intellectuals to explain why allowing the rich to enjoy their wealth is a good thing for all. there is no shortage of intellectuals who can find these explanations. it’s not so hard, if you talk about ideas, about numbers, about plans. just don’t talk about individual, actual people.

  28. December 28th, 2006 at 07:47 | #28

    Loomis, in addition to free trade in goods you need to have free trade in labour as well to give everyone the best possible chance of getting a job. Your doom and gloom scenario on unemployment has not happened, despite the problems of adjustment which would not have been an issue if we had free trade from Federation instead of screwing up with tariffs and the centralised wage system.

    Capitalism as the law of the jungle is out of date rhetoric. Do yourself a favour and get up to date on free trade under the rule of law. That is all about individuals and their particular wants and needs, including our needs for affiliation and identity.

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