In praise of libertarianism
I got a great response from libertarian readers to the Great Shave Appeal, and so the final instalment in my â€˜In Praise of ..â€™ series is addressed to them.
Although they are often at loggerheads, libertarians and social democrats share plenty of ideas, derived in large measure from common sources. Both draw heavily on the 19th century liberalism of John Stuart Mill, who managed to write effectively in support of both classical free-market economics and, later in life, a rather abstract form of socialism.
Itâ€™s not surprising then, that I broadly agree with libertarians on the classic civil liberties issues – freedom of speech, freedom from arbitrary arrest and detention, opposition to government intervention in private decisions such as sexual activity and drug use and so on.
The attacks on civil liberties since the Iraq war have made many of these issues more vitally relevant and led me and others to stress our areas of agreement with libertarian defenders of freedom such as blogger Jim Henley. They have helped to distinguish genuine libertarians from otherwise orthodox authoritarians (typically US Republicans), who happen to take a relaxed view on sex and drugs.
The war in Iraq has also led me to recognise, more than before, the merits of certain styles of argument typically associated with libertarians. The Iraq war is, after all, a paradigm case of a failed government intervention, based on fanciful blueprints that bore no relation to reality. Some who supported the war have sought to argue that it was a good idea, badly implemented, and this is an argument often brought forward in favour of other failed policies. However, it was obvious enough, even before the war, that it would only work if everything went to plan, including things where the â€˜planâ€™ was little more than wishful thinking. Different policies after the invasion (for example, not disbanding the army or sacking Baath party members en masse) might have avoided some of the disasters we saw, but perhaps different disasters might have ensued.
More generally, whereas I once used to be strongly in favour of economic planning, Iâ€™m now a lot more sceptical. Although I still see a large role for government in the financing and provision of public goods, I think itâ€™s important to maintain as much scope for individual choice as possible, and to seek to use the power of the state as lightly as possible to achieve policy goals. Particularly in relation to the environment (my main area of research) Iâ€™m a strong, though not uncritical, supporter of market-based instruments such as cost-based pricing and emissions trading schemes.
I got a specific request from Terje Petersen to write about the Australian Banknotes Act of 1910, of which I have to admit Iâ€™d never heard. A quick check suggests that itâ€™s the basis (in Australia) for the government monopoly over the issue of paper money. I havenâ€™t had time to think about this very carefully, but my preliminary view is that Terje is right. The proliferation of private near-monies, such as gift cards and similar, has not caused huge problems, except as regards their lack of convertability, which leads to a lot of them never being cashed (a form of private seignorage). As long as it is made clear that privately issued notes are not legal tender (that is, no one can be required to accept them as payment), they would represent an improvement on these near-monies.
Coming back to libertarian thinking in general, our current exercise in raising funds has been a highly successful piece of voluntary collective action. Iâ€™m very grateful that so many readers, libertarian and otherwise have pitched in to help.