I’m having another go at opening comments on the Fabianism post below. I think the problem is that the ideology under discussion is objectionable to my spam filters, not for political reasons but because it contains the name of a well-known treatment for male performance problems.
Anyway, if you have comments, you should be able to post them here, but try to avoid the text string in question.
John Quiggin 
Andrew Reynolds’ faith in free markets certainly rivals Dorothy’s faith in the Wizard. One day, maybe he will arrive in Oz and discover that the Wizard is only an illusionist. One can only hope that regularly participating in this blog is part of his Yellow Brick Road.
Prof. Quiggin’s Submission to the Productivity Commission Inquiry into the Socio-economic consequences of National Competition Policy (Sept. 1998) summarises many of the reasons why it is unrealisic to believe that unrestricted competition is always and in all circumstances the best economic regime. In that Submission, Prof. Quiggin remarked: “In the standard economic framework, competitive markets are not regarded as an objective in themselves, nor is it supposed that competition promotes technical efficiency. Competitive markets are seen as desirable because, under certain ideal conditions, the price signals they generate ensure that resources are allocated to the use in which their value is greatest. However, these assumptions are not always satisfied.� Prof. Quiggin reviewed these assumptions in the submission, but I will not go into them here beyond noting that “In economic analysis, a market is competitive only if it contains a large number of firms, each of which is too small to affect the market price�. That itself doesn’t sound much like our world. A review of the further assumptions listed in the Submission removes it even further.
It is important is to note that even if the ideal conditions obtain, a purely competitive regime doesn’t necessarily promote technical efficiency, nor (though Prof. Quiggin’s Sub. doesn’t mention this point) does it necessarily promote a decent standard of living for all.
In the more familiar circumstances of markets containing only a few firms, Prof. Quiggin said: “In economic analysis of strategic interactions between small numbers of firms, there is no presumption that competition for market share will yield long term benefits to consumers. Where competition among a few firms involves a struggle to dominate strategic areas of the market, it is likely to involve a waste of resources, and the adoption of pricing policies that are not closely related to costs�.
I suppose in the present circumstances it is necessary and worthwhile to review the reasons why there is a need for Govt. regulation and sometimes ownership of economic organisations, though it still seems odd to me to have to argue so strongly for what seems a very moderate position. Times do indeed change, though it would appear that I am far from alone. Opinion polls seem to indicate that lots of people prefer Govt. provision of social services over reductions in tax, and by 2003 public confidence in corporate Australia was far lower than in the pre-microeconomic-reform era.
gordon,
You have comprehensively failed to address any of my points – relying instead on sweeping generalisations and further strawmen. Your faith in governments’ abilities to do the right thing is what comes from Oz.
Even if (a point I do not concede) there is extensive market failure the next question must be “Well, can a government fix it and what consequences will that fix have?” This boils down to “Will the purported fix be worse than the problem?”
Before you go off constructing yet another strawman, I am not, and never have been saying, that there is no role for government. There is – just as there is a role for private charity. To me, though, government action, using as it does wealth taken from people by force or its threat, should be backed up by a rigorous cost / benefit analysis. I am not confident that the bulk of current government spending would even come close to meeting such tests.
Oh, and the majority of the world’s population used to believe the world was flat. Please argue the point, rather than arguing that the conventional wisdom is X, therefore X is true. In any case, public confidence in corporate Australia should be low – we do not have to trust the people in it for the system to work. The real worry is the trust ratings for Federal and State MPs in the linked survey – given the legal powers they have the ability to trust is important. To me, that survey indicates we should be reducing the power of the politicians and increasing the power of the people. A free and open market comes closer to meeting that objective.
Dear friends and comrades,
I have decided to change my amendment to the Fabian Society ‘Statement of Purposes’ to an amendment of the motion being moved by the National Executive. While I wanted to proceed with the motion I originally listed here, I have to work today, and at short notice don’t have access to a photocopier. I have therefore organised a much shorter motion which I have been able to print on mass at home. I hope you agree that the new motion has a similar effect to that I previously suggested, with the benefit that it is much easier to understand and thus, I hope, is more likely to be passed.
It reads as follows:
Motion: To amend the motion endorsed by the National Executive to alter the Statement of Purposes to also include the following:
f) to provide a forum for the discussion of democratic socialist politics, ideas and principles, and a vehicle for agitation for these politics, ideas and principles, including the tackling of stratification, exploitation and disadvantage based on class, and advocacy for a democratic economy, including strategic socialisation of infrastructure, services and enterprises, and the promotion of mutualism, co-operativism and democratic wage-earner funds as vehicles for economic democracy.
moved: Tristan Ewins
Andrew Reynolds, who doesn’t trust Governments, thinks that “government action…should be backed up by a rigorous cost / benefit analysis”. I agree. That’s why we have Budgets and elections. I also agree that many Govts. are more or less corrupt – a possibly useful “quantitative scorecard of governance practices in each country” is offered by an outfit called Global Integrity, about which I know nothing. I think other such rankings are avaliable from other sources. So some Govts. are worse than others.
And some firms are worse than others, too. Back in Nov. 2004, Business Week editorialised as follows: “The truth is economists don’t usually compute the tax that is imposed on economic growth by corruption. They should. In the past few years, we have witnessed conflicts of interest and manipulation within the initial public offering, mutual-fund, investment banking, and insurance markets. These rigged markets stifle innovation, erode discipline in the markets, channel money into less productive activities, add expense, and undermine national competitiveness.
We know that government regulation places a heavy burden on America’s companies. We should recognize that market corruption may place an even heavier burden on the nation’s economic growth”.
I suppose we could get into an argument about whether Govt. corruption is responsible for business corruption or vice versa, but I doubt whether that would lead anywhere. It is probably more important to realise that complaining only about one sort of corruption is one-sided. Govts. are not perfect, though some are better than others. Firms and markets aren’t perfect either, and again, some are better than others. So it seems more sensible to attack corruption wherever found, rather than only in Govts. I don’t see any other way of increasing the power of the people (as Andrew Reynolds wants to do) except by living in a permanent state of Orange Revolution which, though exciting, might not be very productive.
gordon,
Do you exist in a world where speeches are the main means of communicating? Strawmen, rhetoric, third person addressing. Wonderful. I am waiting for your “I Have a Dream” moment – but I somehow doubt there will be as much real content in your next comment as in a Martin Luther King speech. I will try to find you on the next soapbox I come across.
Try addressing, well, any of my points or questions. Where did I mention corruption for example? While corruption is a problem, even without that the main problem is still there – information. Try reading a basic starter on Austrian economics, like “The Road to Serfdom” and your understanding of the problem would improve enormously.
Even if you disagree, at least you will know what I am talking about. At the moment all you are doing is writing speeches in a vacuum.
Tristan,
I’m not entirely sure why you have chosen to amend your motion but I would honestly love to see a response to my post regarding rights and some sort of explanation of what would likely happen to the three parties in the simple case study I posited.
One must wonder if that simple case study can sit on this site for a few days and be passed over for a response that only involves three entities, one must wonder at the difficulty that would translate into applying your beliefs across a whole society.
gordon,
Just to finish this off. I was reading this post on catallaxy and it pointed me to a monograph on the letter to The Times newspaper in 1981 by 364 economists about the policies of the Thatcher government. In that monograph was this passage (on page 100), which I feel is worth repeating in full.
Nothing more need be said.
Andrew Reynolds, would you please tell the audience what happened to Margaret Thatcher and her v. Hayek inspired economics?
PS: I learned from a post by Terje some months ago that Thatcher was very much influenced by those who promoted v. Hayek.
Happy to, Ernestine. The UK successfully pulled themselves out of the morass into which they were sinking. Inflation dropped, unemployment dropped (after the expected lag) and wealth has increased. Or was that not quite what you were looking for?
I should add though, that she was not strictly Austrian. A dose on Monetarism was there, mixed in with some political realism. The political realism faded towards the end.
nb: since this thread was originally about Fabianism, I thought I’d let readers know that there was some confusion. Tonight was the state AGM, but the National AGM, where the decisions will be made, is not until 5:30pm next Thursday. (a pretty bad time if you ask me – give some of us work) There’s still the possibility that someone will try and move that the changes be passed, but a motion of the State AGM recommended that the decision be put off until 2006, and only after extensive and inclusive debate. It is most likely that a decision on the inclusion of socialism, commitment to public ownership and to class politics in the Statement of Purposes will now be put off until next year. I’m hoping there will be such an upsurge of sentiment against the changes that either the changes will fail, or only pass with significant amendment.
Tristan
sorry, I mean 2007, not 2006
Tristan Ewins, you are perfectly right in objecting to deviations from the topic of the thread. I apologise.
Tristan,
Yes, when discussing Fabianism, it is important not to look at whether the positions of Fabians make any sense at all. I apologise too.
I’m not objecting to deviations in the thread – I think the discussion has been healthily wide-ranging – but I thought, given the original line of the thread, it was important to keep readers informed.
Tristan,
I agree the debate has been healthy but I was hopeful you or somebody else would step up to the plate and explain away my three person case study, who get’s what? And what injustices have been committed and by who? I’ve been asking similar questions of people of your philosophical belief structure for a good part of my life and have developed a cynical assessment of why you and others choose to opt out on answering them.
If pages and pages of dogmatic “Statements of Purpose� can be thrown together it seems a bit suspect as to why it is so difficult in applying them, especially in such a simple example.
Perhaps you’ve been somebody that has fallen blindly in love with the warm and fuzzy objectives of socialism without ever wanting to consider it can’t work.
Prove me wrong! From before:
“To bolster the case for the far reaching redistributive policies you mention such as progressive taxation, inheritance taxes and a cradle to grave welfare state you must firstly identify at what stage of human interaction the injustices occur.
Hypothetical Case Study:
Person A accumulates enough wealth and skills through hard work and honest endeavour to establish his own profitable business making widgets. Buying land and equipment at market values, widgets sold for market value. Person A earns $50K per year in profits
Person B approaches or is approached by Person A to work for an agreed rate and set of working conditions. Person A and Person B forge relationship agreeable to both parties. Person B earns $35K per year
Person C for whatever reason cannot or chooses to not to exchange his value, skills and labour with either Person A or Person B. Leaving Person C with significantly less than what either Person A or Person B have. Person C earns next to nothing.
Tristan in this example who has committed the injustices and what happens with Person C according to how you would apportion “rights� or “privileges�??�
Hank, your hypothetical case study is not interesting. For example, you don’t even exclude the case where all three of them, A, B, C, die of starvation because the highest income of $50 is not sufficiently big to sustain life (the mere mentioning of ‘market prices’ does not constitute a sufficient condition to exclude this outcome). Alternatively, if ‘next to nothing’ is big enough to survive, then all you are giving are three examples of different preferences. My usage of the word ‘sustain life’ can be interpreted in social contexts such that it is quite consistent with the notion of ‘decent living wage’. Hope this suffices in answer to your question.
Tristan, in case there is any doubt, my apology was sincere – I had overlooked the heading of the thread.
Ernestine,
Of course it does not answer the question – but I had not expected more. I would have thought that it was obvious that the income was sufficient to sustain life if person A has accumulated capital on the back of it and has employed another person. Person A would hardly do that if he or she was dying of hunger.
Arguing the trivial to try to discredit the general case is not edifying.
Andrew, I think we have both made our positions clear. I’m happy to leave it at that if you are.
Andrew Reynolds. I replied to the question as posed by Hank. If you wanted to reply to Hank, you had ample opportunity. I am not into implicit theorising or, alternatively put, the generation of ideologies.
As for your characterisation of Thatcherism, I do think you forgot to mention the ‘big bang’, the 1997 stock exchange crash, and the negative equity of people in the housing market – hardly an illustration of ‘wealth creation’ – and that Geoge Soros make 1 billion pound on financial transactions which demonstrated that he understood the logic of the system and that it doesn’t work the way some people wished it worked.
However, you are entitled to chose whatever information you wish to select to make you happy.
I am happy to leave it at that, if this is fine with you.
Ernestine,
I saw no reason to reply to the question – it was not posed to me nor did I disagree to the position from hich it was put. I did not consider what you left there to be an adequate response. Nor do I consider that you have even attempted to answer it. Perhaps it is too dificult?
The ‘big bang’ was an unqualified success, the 1987 stock exchange crash, a global event, can hardly be blamed on the policies of the UK government. Negative equity was caused by a mis-timed announcement of a tax change and the mis-information put forth by the Labour Party – sad, but hardly the fault of the correct policy.
As for George Soros – check your calendar. At what point precisely during Maggie’s time as PM did this occur? Even though the decision to go into the ERM was taken during her period as PM (1 month before it ended) this was clearly a John Major decision as he was Chancellor at the time. But yes, governments interfering to fix the exchange rate is wrong.
Perhaps you should check your own selective use of information and understand that there are things you do not know. It may reduce the appearance of arrogance that inhabits your comments.
I am happy to leave it at that if you are.
I do hope you feel better now, Andrew Reynolds.
As usual, avoid the issues. Looks like we will have to leave it there.
Well I’m not happy to leave it there but I do realise that getting any objective logic out of the left wing is like getting blood out of a stone.
Answering questions like I posed would make clear the true socialist agenda which nobody through choice is going to accept, unless they think they’ll be ones calling the shots.
Adios, until the next battle, then you can scurry for cover again just like cockroaches when the light of logic is shone upon you.
Answers: Under socialism absolute inalienable rights do not exist.
And in the my case study Persons A+B must submit their indivualism to the collective and are stripped of their earnings to the degree necessary to give Person C an equivalent outcome consistent with Marx’s creed “From each according to his abilities, to each according to his needs.”
Dear friends,
Here’s the latest draft of points for inclusion in the Fabian ‘Statement of Purposes’ that I’ve produced. Feel free to discuss if you like. I’ll be proposing these for inclusion in the Fabian constitution whenever a decision is made:
• to provide a forum for the discussion of democratic socialist politics, ideas and principles, and a vehicle for agitation for these politics, ideas and principles, including the tackling of stratification, exploitation and disadvantage based on class, and advocacy for a democratic economy, including strategic socialisation of infrastructure, services and enterprises, and the promotion of mutualism, co-operativism and democratic wage-earner funds as vehicles for economic democracy.
• To promote an open, inclusive and participatory public sphere, including a variety of participatory and alternative media, the provision of civic public space, and public meetings, conferences and forums
• To agitate and struggle for the realization of liberal rights and principles such as: equality before the law, pluralism, freedom of speech, assembly and association, equality of opportunity, and the right to collectively bargain and withdraw labour
• To promote and provide a forum for the discussion of policies favouring co-existence with and preservation of the natural environment
• To support struggles and policies which seek to overcome oppression and exploitation in its manifest forms: whether based upon class, gender, sexual orientation, race, nationality, religion or ethnicity
• To promote and discuss the establishment and sustenance of a progressive welfare state and social wage, including: the universal provision of quality services in health, education and aged care, and the funding of welfare, services and infrastructure through a comprehensive regime of progressive taxation
• To promote and discuss the aim of progressive and egalitarian labour market regulation, including a comprehensive regime of minimum wages and conditions across all occupations and industries, and occupational health and safety provisions
• To further the principles of democratic socialism, liberal democracy and social democracy, and the education of the public in these principles by the holding of meetings, lectures, discussion groups, conferences and summer schools, the promotion of research into political, economic and social problems, appropriate international exchange and co-operation with like-minded social movements globally, the publication of books, pamphlets and periodicals, and by any other appropriate means.
re: the model of three individuals and their relative wages
Firstly, you have to ask the question: WHY should the government intervene in the labour market, and in redistributing wealth through progressive taxation and provision of a social wage?
To begin with, it is a matter of compassion. No one ought go without quality aged care or health care, a minimum income, shelter and nutrition, basic necessities for social participation such as transport and telecommunications services, or should be disadvantaged in their educational prospects because of disability, lack of skills, low wages, being born into relative poverty etc. Regardless of one’s skills or bargaining power, no-one should have to live in poverty. It is a matter of a society’s basic decency and compassion that no individual lack provision of such basic services and opportunities.
Secondly, there is the question of social justice. Competing in the labour market, receiving returns in keeping with our skills or our bargaining power (including the strength of organised labour), there is no garauntee that the market will deliver a fair or just recompense. Arguably, skills and bargaining power ought not be the sole determinant of income: where many labourers work hard for relatively small returns. Also, in the public sector, the relative fiscal crisis of the state puts downward pressure on wages, with the consequence that some workers: teachers for instance, experience a relative depression of their wages. A progressive income tax system and social wage ‘irons’ out unfair inequalities that arise in the labour market as a consequence of supply and demand and unequal bargaining power: providing for the basic needs of all.
Tristan,
Why do you believe compulsion is needed to achieve this? Do you also believe that assets compulsorially acquired like this will be distributed fairly and equitably when do so by a government whose agenda may differ from these objectives?
Andrew,
You must realise that according to socialists we are all mindless beasts incapable of making “the right” choices that must be ruled by force and compulsion by people(them) that have some mystical knowledge.
Tristan,
Each of every entity that exchanges value for value have elections every day of the year and minute of the day. If they fail to produce what individual members of society want or need in the most efficient way possible then they will flounder out of existence. This is what drives humanity forward and gives everybody a wonderful standard of living. How you can possibly believe or attempt to justify that the free choices that millions of people make on a daily basis is flawed and inferior to the “antfarm” approach societal models from socialists at the Fabian Society I have no idea.
You seem to want to use compassion as justification for massive redistribution. Whose compassion? Once again socialists arrogantly believe that individuals are incapable of private charity with this mystical knowledge kicking in again removing their possesions by force.
Socialisms’ objectives certainly sound nice to some in theory but unfortunately have never been delivered in practice and never will be. Instead poverty, oppression, terror and shattered lives have followed socialism wherever it has been tried. Capitalism delivers the needs of humanity and essentially makes each of every person their own king or queen.
My advice to socialists is if you are hellbent on controlling the lives of something go get a pet dog. Drop your envy emotions and start showing some respect to your fellow man who is quiet capable of making their own decisions in life.
If this is impossible simply explain your mystical superior knowledge, move yourself to an already established socialist collective like North Korea or Cuba otherwise keep your mitts off my property and life.
Hank Reardon,
I answered your question on your hypothetical case study. I told you the reasons why your hypothetical case study is not interesting from the perspective of the theoretical framework of ‘free markets’. That is, I applied the logic of the theoretical framework of ‘free markets’ and showed that given the information you made available in your ‘hypothetical case study’ one gets two uninteresting solutions; ie the question of justice does not even arise.
Not very impressive if you don’t even know the logic of the theory of ‘free markets’.
Andrew Reynolds, you didn’t pick it either.
I should think that the examples of social democracy in Western Europe, including Denmark and Holland, as well as the experience of social democracy in Sweden, Norway and Finland – demonstrate that your caricature of socialism (in my opinion socialism and social democracy are one and the same movement) – is, to put it kindly, not borne out by the facts.
Tristan
Tristan,
Perhaps you could let us know why you believe compulsion is required.
.
Ernestine,
The day you give a straight answer to a straight question is the day I give an expression of extreme surprise. In any case, you gave one very uninteresting non-answer to the point put, you did not show “that given the information … made available in [the] ‘hypothetical case study’ one gets two uninteresting solutions”.
Andrew – do you suppose we’d be able to fund anything if tax were ‘optional’?
Andrew Reynolds, Where is the straight question to which you think there is a straight answer? You didn’t like my answer. That’s all.
Tristan Ewins is asking you a question which seems tome to be ‘straight’. I look forward to see what your ‘straight’ answer is.
Tristan,
Why do you seemingly believe that we need to fund these objectives out of compulsorially acquired funds? Why do you believe that only taxation can provide answers to the following:
You use the word “compassion” several times in there. Do you think that the only “compassion” in society consists of forcing money out of people so that the ones who forced it out of them can then waste much of it and then give the rest away? This is the Robin Hood complex, with waste thrown in.
If so, I do not concur with your dismal view of human nature.
.
Ernestine,
The straight question you avoided was Hank’s.
If you choose not to answer it, fair enough, but to just treat it the way you did either indicates outright rudeness or a desire to avoid the consequences of a straight answer.
I hope you are politer in real life than you appear to be when answering questions from those you evidently disagree with.
Andrew Reynolds (Hank)
If you wish to have only the ‘answer’, which you consider ‘straight’ or ‘not rude’, then the efficient way of achieving this is by you providing the answer together with the question.
Incidentally, Hank’s question is not ‘straight’, where ‘straight’ is defined as only one possible answer to the question. On the contrary, one of the sub-questions has an ‘or’ in it. But, I suppose, I am being rude in your eyes for stating the obvious.
Ernestine,
Your original attempt to answer the question was, as far as I can work out, was “…all you are giving are three examples of different preferences” when the question was clear “…who has committed the injustices and what happens with Person C according to how you would apportion “rightsâ€? or “privilegesâ€???â€?”
I, being a (I hope) reasonably sensible person, would expect an answer that indicates whether an injustice has been committed, what happens to person “C”, and how the “rights” and “privilegesâ€? discussed earlier were to be apportioned. You know, a straight answer. Indicating that there are three examples of differing preferences does not quite answer the question.
Tristan, care to answer the questions that were actually originally directed at you?
Ernistine,
Bad luck for you hoping that Andrew Reynolds and myself are the same person. Worse still for you there are thousands of others that share our viewpoints.
Now, I thought my questions were amazingly straight forward, you only had to break down how much money was appropriated from each of the parties and state who had committed injustices warrenting the forcible removal of their property to be given to another.
If however you are only capable of answering questions with one possible answer have a crack at these for us.
Yes/No
Do I have the right to live for my own sake?
Do you know how to spend my earnings better than me?
Does anybody have a greater right to my earnings than me?
Do individual, absolute inalienable rights exist under socialism?
Do socialists have a superior knowledge of all things justifying them to have control of peoples lives?
Have you ever taken steps towards migrating to a socialist country?
Are the majority of people mindless beasts that must be ruled by force?
Just to fair too, you can level whatever questions you want to ask my way.
Of course the above is open to all-comers, not just our good comrade Ernistine. Why don’t you have go at these ones Tristan?
Andrew Reynolds and Hank Reardon,
I think things are getting a little out of hand. You write a lot of ‘stuff’, interlaced with what seem to be your assumptions about motivations and asssumptions about assumptions and ‘stuff’ I find difficult to extract any meaning. If this is the way you like it, go for it, but leave me out of it.
To put you in the picture, I am not into politics at all. Andrew Reynolds should know this by now.
Ernestine Gross
OK, Ernestine, I will have to take a non-answer as your answer; but given your obvious intellectual talents I would have thought you could sort through it.
Ernistine,
Perhaps there is a little integrity in waving the white flag. Ernistine you’ve done better than the people that have sat back afraid to put their beliefs and thoughts onto this forum or those that started and then went into hiding.
None of my questions had little to do with politics though. They are fundamental questions about how we want to live our lives. More philosophical than political but asking them uncovers the dark and ugly side of socialism that dictates that individualism is evil and all thoughts, dreams and possessions must be given to one big collective administered by a ruler under the use of subjective force.
If I had to guess Ernistine I would think you’d be quite young that has been sold the falsehoods of socialism.
Ask yourself those questions and then go ask those questions of the person that sold you copies of Green Left Weekly.
Perhaps you can grow to embrace the notion that human happiness comes from having freedom both personal and economic and having inalienable the same as any other man.
This deceptive socialist mantra that some all knowing mystic can make better choices for everybody and we all live happily ever after is fanciful rubbish. History has proved it again and again that it always ends in poverty and pain.
What do you think Prof Quiggin, Tristan Ewins??
Andrew,
Where did they go?
Was it something I said?