How Bougie Is Democracy?

I’m quite interested in how pro-establishment, pro-status quo, economically powerful people make common cause with anti-establishment, anti-status quo, economically weak people. Maybe I can discuss it a bit this week, with a humorous nod to the word “bougie?”

In my youth, pejorative use of the word “bourgeois,” “bourgie” or “bougie” for short, was confined to fatuous, egotistical rich people looking for a snarky insult for what they saw as socially inferior middle class people, particularly if they supposed them putting on airs. So, for example, one might expect a spoiled young tycoon with inherited billions, living in a grand estate, to hear a middle class person talking about his or her job, career, retirement, modest house, whatever, and declare it bougie, that is, relatively low class, inferior. More recently, I’ve noticed economically weak, struggling people using “bougie” rather differently. They also use it to describe middle class people, maybe still with some connotation of pretentiousness, but as a criticism of a quasi-elite with a modicum of economic power.

I realized it recently when aimlessly channel surfing and encountering a young English lady giving video tours of her favorite posh stores in London, talking about what appealed to “the masses,” and declaring especially fancy, pricey items “bougie.” The usage seemed obscure. Was she saying the offending product was something only tasteless, bling-seeking plebs, “the masses,” might buy? Or was she saying it was particularly pricey, fancy, something an economically struggling person might suppose rich people would like? It seems today coddled rich tycoons and struggling poor people can make common cause lambasting middle class people and their concerns, tastes as bougie, but for entirely different reasons, masking the even greater scorn tycoons may have toward the poor and possibly vice versa.

It seemed to me a reflection of a similar thing going on with respect to anti-democracy sentiment, shared by pro-establishment, pro-status quo, economically powerful people and anti-establishment, anti-status quo, economically weak people, but often for quite different reasons. Economically powerful, egoistic, establishment types often hate democracy because they perceive it a threat to their own economic power. Economically weak, anti-establishment types often hate democracy because they suppose it captured, dominated by the economically powerful. The two groups often clearly have very different criticisms, with very different potential solutions, and would be at one another's throats if democracy were ever actually eliminated, but before then, they may act the part of good friends, united in anti-democracy zeal, anger.

It’s not always the case. Economically weak people, especially under the influence of anti-democracy bad economics in the conservative style, may genuinely desire government be more completely dominated by the economically powerful because of their ostensible merit. But it seems to me often the case they’re talking at cross purposes at some level. While some clearly suppose they’re fighting the prospect of radical change in any aspect of economic power, their allies seem to suppose they’re fighting just as enthusiastically for such change. One can imagine the economically powerful lambasting democracy for being bougie, too responsive to the hoi polloi, the mob, insufficiently controlled by economic power, and the economically weak agreeing, "Yes, bougie; so indifferent to the poor, dominated by the rich.”

One should look beyond the fact democracy doesn’t always give one what one wants when one wants it before making common cause with others on that basis. Ask what problems they perceive, how they intend addressing them, or one may just end up a useful idiot, a tool. Understand the ethos of democracy, why some suppose the views of the governed valuable, its basis in ultimately subjective and changeable secular ethics, but also its implications for stability, ability to undergo peaceful change and development, free speech and thought, etc. Think of democracy in systemic terms, to be evaluated against other potential political systems, not just on the simplistic dimension of whether it delivers what one wants the moment one wants it. I suppose no system can reliably provide that result. That’s not a real issue.

Bad Economics In the Conservative Style, Fascism, And The Welfare State

Ever think about conservative notions of “socialism” and the “welfare state” in the context of fascism or the ostensibly “utility” maximizing, social welfare optimizing free market utopianism of bad economics in the conservatives style? Let’s discuss. Fun issue.

Conservative antipathy toward “socialism” and the “welfare state” is especially evident in their peculiar take on fascism, which they view as defined by “welfare state” pretensions, not be support for anti-democracy, authoritarian government in support of conservative views on economic power. They feel they aren’t fascists by supporting anti-democracy, authoritarian government in support of conservative views on the ethics of economic power, but rather those who support democracy are fascists, if they engage in welfare state thinking, hold socialistic views. However, if one delves into conservative economic and political rhetoric and ideology, particularly anti-democracy bad economics in the conservative style, the relationship of socialistic or welfare state thinking to their own ethics of economic power may appear a bit murky.

Clearly, one may espouse conservative views on the ethics of economic power in a thoroughly egoistic or amoral way in which the well-being or welfare of others in one’s society, or some of them anyway, is meant to have no normative or ethical significance. One can see a thoroughgoing ethical egoism or amorality in some forms of anarchism (including fake anarchism / crypto-fascism), monarchism, theocratism in which there either is meant to be no “society” or the well-being of others in society is meant to be ethically irrelevant. However, that’s clearly not the case for everyone who supports conservative ethics relating to economic power, and in particular not for those who endorse or promote anti-democracy bad economics in the conservative style, loosely based on neoclassical welfare economics. At the most simplistic, popular level, one may perceive welfare state or socialist thinking in conservative rhetoric in the form of claims their ethical views on economic power, economic policies, are about what’s best for “everyone” or “America” or society. However, at that most basic level, one may suppose they have in mind simply a proposed shared satisfaction from government expressing conservative ethics on economic power rather than everyone’s welfare being accommodated in any more tangible sense, so it’s not entirely clear. Fun question: if everyone in society agrees the fate of society, the well-being or welfare of others in that society, irrelevant, and everyone is made happy or satisfied by government expressing that, is support for that creed consistent with socialistic, welfare state thinking? Seems obviously to depend what one means by “society” (a society of people who don't believe in society?), “welfare” in terms of “happiness” and “satisfaction” (the well-being that comes from the satisfaction of perceiving others indifferent to one’s well-being?). Fun with words. But it doesn’t seem all at that level of arch word play. Some conservatives seem to propose their policies will make everyone “better off," maximize “social welfare” in some more tangible sense, often involving conventional indicators of welfare, economic power, health, etc. That’s where the conservative free market utopianism associated with anti-democracy bad economics in the conservative style comes in, based on confusion generated by the peculiar definitions of “utility,” “welfare,” and related words in neoclassical welfare economics. 

The only welfare, utility, neoclassical welfare economics addresses is individuals moving up their own preference ranks; anything relating to relative welfare or well-being in terms of resolving interpersonal conflicts of preferences, allocating resources, is exogenous. If one has any notion of “welfare” or “utility” that relates to anything anyone might suppose evident, relevant in interpersonal contexts, economic power, material well-being, health, smiling faces, whatever, that’s not what we're talking about in neoclassical welfare economics. It’s meant to show how little one can say without getting into the ethics of resolving interpersonal conflicts of preferences, but aided by the sly, clever, arch, creative, rhetorical misuse of language, many come away instead with bad economics in the conservative style instead. Thus, it’s true one who merely expresses the unreal, limited conclusions of neoclassical welfare economics about individual preference ranks is not really expressing any socialistic concern for others, any “welfare state” thinking, nor expressing conventional “utilitarianism.” Ironically, however, conservatives opposed to socialistic or welfare state thinking typically misinterpret neoclassical welfare economics in the style of bad economics in the conservative style to express socialistic, welfare state, utilitarian goals. It’s really rather comical. 

And to put the cherry on top, the pretense of socialistic, welfare state sentiment on the part of the fascist Nazis, their risible claim to represent an alternative, right wing form of “socialism,” can hardly be considered a defining feature of fascism, per se. In the years after the Great Depression leading up to WWII, democratic government in the USA pursued socialistic, welfare state policy in the forms of New Deal programs meant to help economically struggling people. Communist government in the USSR proposed welfare state goals. The fact the fascist Nazis felt similarly compelled to portray an interest in the well-being of German society, the welfare of its citizens, is hardly unique, noteworthy, even interesting, although the funny way they expressed it, military spending, aggressive war, theft, may be. No, the defining feature of historical fascism such as Nazism was not the movement’s welfare state pretensions but their view undemocratic, authoritarian government was necessary to fight “leftist” ethics relating to economic power, including from voters in democracy.

When you hear an anti-democracy conservative or Republican lambasting socialistic and welfare state sentiment about the well-being of other people in one’s society, ask their own views on the significance of the well-being of other people. And just be aware conservatives lambasting socialistic, welfare state thinking who themselves propose the welfare of society matters, propose to speak for “everyone,” “America,” for a system that makes everyone better off, are speaking insincerely, playing rhetorical games.

Normative And Positive And Bad Economics, Again

I thought I might say a few more syllables about the distinction between positive neoclassical economics and normative neoclassical “welfare” economics, always a source of fun and amusement in the context of bad economics in the conservative style.

What makes pervasive confusion about positive and normative propositions so interesting in the context of economics is many methodological issues have positive and normative versions, appropriate for their respective contexts, but often muddled or conflated in funny ways. For example, I often discuss assumptions like perfect rationality, perfect information, which show up in positive neoclassical economics as false but simplifying assumptions, but in normative neoclassical welfare economies as false factual premises. Two different issues. Nothing much wrong with false but simplifying assumptions in a positive context dealing with an engineering model meant strictly for empirical prediction, although their use in a purportedly scientific theory seems a bit more questionable, dismissive of fact, reality. In contrast, trying to apply in reality a normative or ethical theory based on false factual premises is just incorrect. It doesn’t reflect reality, what it needs to reflect in order to be evaluated properly as a proposed normative proposition meant for the real world. It’s quite common to get on a funny merry-go-round in discussions of economic methods in which one might object to the use of false factual premises in normative economics only to be told they’re simply false, simplifying assumptions, so it's all good. It’s called bad philosophy.

I noted another example the other day, about trying to understand the rationale for, and implications of, redefining “utility” as preference rank for a given individual. In a positive context, one hears it related to a positivist concerns to discuss only observable phenomenon. In that context, the redefinition is about how we (ostensibly) can’t observe internal feelings or sensations of happiness or satisfaction, so if that’s what we had in mind by “utility” formerly, then we need to replace it with something that is observable as revealed preference. That’s a perfectly fine point to make as far as economics as a predictive engineering model or a dodgy simulacrum of a scientific theory, but it doesn’t really make it in the context of a normative ethical theory, which must and always goes beyond observable phenomenon. Indeed, the distinctive characteristic of a normative or ethical theory is it involves propositions that require evaluation by the subjective moral sense or sensibility. It’s not just about facts, science, logic, math, observations; it also involves ethical judgment. When one apprehends neoclassical welfare economics as a normative, evaluative, ethical theory, one has a different perspective on the rationale for, and implications of, redefining “utility,” namely, it changes the nature of the normative assumptions, conclusions.

Getting serious about normative, as opposed to positive, economics, becoming interested in how the redefinition of “utility" changes the normative assumptions, conclusions, is the gateway to more easily perceiving the rhetorical program of bad economics in the conservative style. If one has an ethical theory, even a partial and unreal ethical theory using false factual premises, addressed to maximizing “utility,” associates that with social “welfare,” the evaluation must hinge on the definition of “utility,” not simply the word, but how it’s defined. Do you know what it means to maximize “utility” defined only as the preference rank of a given individual, inappropriate or undefined when thinking of more than one individual at a time? Do you understand it’s not a typical sort of definition one finds in ethical utilitarianism? Not going over it all again here, just saying, consider if that shift in the supposed goal may, in fact, have been the point of the redefinition, and if bad economics in the conservative style expresses the implications of that redefinition accurately. Just some things to think about. Some motivation for bothering trying to make sense of some of the issues I discuss, week in and week out. Think normative, evaluative, ethics, morals, values. Set aside, save for later, positive, empirical, predictive, scientific.

To complete the set, shall we go over two other bad takes on positive and normative in economics? One is that normative ideas may affect positive science in various ways as a form of bias. Sure, but that doesn’t imply there’s no distinction between positive and normative. A normative or ethical theory about what one ought to do may have positive elements as factual premises, logic; a positive scientific theory about what is may have normative influences, motivations, biases. But normative and positive remain distinct at the propositional level. A particular form of philosophical claptrap common today seeks to obliterate the distinction between positive and normative, is and ought, science and ethics, arguing one is justified in supposing whatever one wants or prefers to be the case is, in fact, the case. One is not.

The other bad take is normative economics is just positive analysis of the logic behind a random normative, ethical theory other people, certainly not economists, propose, promote, evaluate highly, take seriously. Just trying to be helpful. Not a very sincere argument, is it? Purveyors of bad economics in the conservative style, including many economists, clearly promote their normative theory, based loosely on the ethical half-theory of neoclassical welfare economics, as a normative, evaluative, ethical scheme others should take seriously. And all ethical theories meant to be applied to the real world may be evaluated along different lines: the scientific accuracy of any proposed factual premises, the logic, but also, crucially, whether one agrees, evaluates highly the normative inputs, assumptions, conclusions. Evaluate conclusions? Yes, ethics isn’t a logic problem. One may evaluate normative conclusions as a check. Logical manipulation cannot add normative content, so acceptable normative inputs, true factual premises, sound logic, yet unacceptable results is a paradox to investigate. In some cases, the implications of seemingly innocuous, acceptable normative inputs or assumptions only become apparent in the conclusions of an ethical argument, which is perfectly fine and should lead one to re-examine or re-evaluate those inputs. That’s philosophy, ethics. Don’t fall for the rhetorical gambit I call “positive normative economics,” in which one supposes proponents of normative economics are simply logicians, mathematicians, working out the conclusions implied by normative inputs they don’t necessary accept, although others might.

The big, controversial issues in economics are mostly normative in nature, about ethics, values, philosophy. Learn about them and the appropriate methods to investigate, discuss them. Learn to distinguish them from positive, predictive issues, the philosophy of science.

What Puts The Bad In Bad Economics

I thought this week I might go over, yet again, what I suppose puts the “bad” in bad economics in the conservative style with an eye to establishing it’s not the normative content, per se, but how it’s identified, expressed, explained, discussed. Good times.

One apparently common view of how neoclassical welfare economics is meant to work is that it should accept as given existing laws relating to economic power, the definition, distribution, use of economic power to resolve interpersonal conflicts of preferences in markets. The ethical indifference to how interpersonal conflicts of preferences are resolved associated with the conceptual restrictions imposed by preference rank “utility” is interpreted in that case as accepting status quo laws, ethics relating to economic power, whatever they may be. It’s a position I often discuss under the rubric of “fake indifference” because it leads to paradoxical results if one attempts to rigorously follow through the implications of “utility,” which is another common view of what neoclassical welfare economics is meant to be about. What happens is that neoclassical welfare economics ends up seeming to offer normative advice on the optimal resolution of interpersonal conflicts of preferences when the definition of “utility” on which it is ostensibly based precludes it and was specifically designed to do so. What’s happening is support for status quo laws, values on economic power, even if one intends supporting them whatever they may happen to be, is itself an additional normative input, value proposition, that is clearly not based on “utility.” That additional value proposition, not based on “utility,” relating to economic power, resolution of interpersonal conflicts, allocation of scarce resources using markets, may, of course, be quite controversial. It requires identification, explanation, discussion, evaluation.

“Utility” was famously re-defined as individual preference ranks ostensibly to avoid controversial interpersonal ethics, particularly in a theoretical context (i.e., the Fairy Land) using false factual premises like perfect rationality, perfect information. That’s the whole point. But the point does seem sometimes lost on those accustomed to ignore the normative or ethical content of neoclassical welfare economics, who often see the redefinition of “utility” as more about positivist concerns, scientific restrictions on what we can observe. If one then tacks on an additional, unrelated value proposition supporting existing laws on economic power, markets, using those to support particular resolutions of interpersonal conflicts of preferences, that’s a big deal, it changes the entire nature of the exercise. Specifically, neoclassical welfare economics would then not be ethically uncontroversial when applied to the real world, and not just because of the false factual premises and other obvious differences between real people and theoretical ciphers such as preferences on ethics. It would also be ethically controversial because it contains pro-status quo value propositions, not based on “utility," relating to economic power, markets, the resolution of interpersonal conflicts of preferences, allocation of scarce resources, that are clearly controversial. It becomes a bait and switch in which hapless students, observers, may incorrectly suppose one can derive answers to controversial ethical issues relating to resolving interpersonal conflicts of preferences, allocating scarce resources, based on individual preference ranks alone.

And that, for me, is what puts the “bad" in bad economics. It’s not really the normative content supporting certain views on the ethics of economic power, resolution of interpersonal conflicts of preferences, but how that additional normative content is presented, or rather not. Before rushing into the substance of the controversial ethical issues involved, can we at least agree at a more general level we should discuss those issues honestly, sincerely, openly? Not try to pull a fast one on people? Not try to con them, trick them, mislead them? Because that’s really all I’m trying to do with my little campaign against bad economics in the conservative style. I’m not trying to argue how interpersonal conflicts of preferences should be resolved, where scarce resource should go. I just want people to talk about it better. Don’t get me wrong. I have thoughts on those issues, like everyone else, and I’ll be happy to tell you about them, and probably sometimes I do. We can discuss, vote. Just that’s not what I’m on about when I discuss anti-democracy bad economics in the conservative style.

The Conservative Rhetoric Of Government

Maybe this week I can lighten it up and talk a bit more about some conservative, right wing rhetoric relating to government, with an eye on fake anarchism / crypto-fascism and bad economics in the conservative style. I’ve done most of it before, but always fun.

Let’s talk first about “minimizing government.” You’ve heard that one, right? “I’m a conservative because I want to minimize government?” The minimum level of government is no government, that is to say, bloody, violent anarchism. So conservatives are anarchists? Sometimes they are, but rarely. Usually, they just mean they want to “minimize” government to doing only what they want it to do, which is basically the same thing everyone else wants, although everyone may not agree on what it should actually do, hence democracy. Why not just take up the actual point of disagreement, what different people suppose government should do and why? Why stop to argue first with all the straw men proposing we not minimize government? Why indeed. It’s called rhetoric, manipulation. 

How about “small government?” How small, you ask? As small as possible? No government at all? Anarchy? No, not that small. As small as it can be and still do the things one supposes it ought to do. Basically “big government,” at least relative to what real anarchists prefer. 

How about more violent rhetoric as when conservatives say they want to “starve the beast (government)” or “drown it (government) in a bathtub?” If government is dead, we again have bloody, violent anarchism. So they support that then? No, not typically. One supposes most conservatives make a distinction between some bit or form of government they support and some bit or form they’d prefer to dispatch by starving or drowning. One gets an indication of what that might be in conservative rhetoric relating to “activist” government.

Talk of “activist” government takes us a bit farther from fake anarchism, although it’s not uncommon to still pick up some implication “inactive” government doesn’t really count as government, per se, so an inactive government enforcing conservative views is like anarchism. More generally, given the whole point of democratic government is it can do things voters want it to do in response to changing events, voter preferences, ethical views, and so on, it can be active, we’re clearly flirting now more with some sort of authoritarian crypto-fascism. But it’s artfully ambiguous, right? Is one saying one supports democracy and is simply suggesting voters refrain from suggesting government do anything? Or is one saying one rejects democracy because it allows voters to say government should do something? It’s not entirely clear. It’s notable in that rhetorical context conservatives don’t seem to care much what form an “activist” government takes, whether it be democratic, fascist, theocratic, communist, etc. That indifference to form of government harkens back to anarchist rhetoric about “the state.”

To understand the origin and allure of this line of rhetoric, one must go back to pre-modern economics, back to Adam Smith, then forward again to the modern bad economics in the conservative style that tries to make neoclassical welfare economics appear it’s still that. Mr. Smith’s concerns were primarily religious. He wanted to show problematic self interest, greed, might paradoxically be considered part of God’s benevolent plan for mankind if mankind could just construct the proper context or system in which it could be properly utilized. That intellectual program evolved, in early classical economics, into a sort of simplistic free market utopianism, but when social conditions raised criticisms, orthodox economists famously artfully redefined “utility” to dodge them, create modern neoclassical welfare economics. Modern bad economics in the conservative style basically picks up where early classical economics left off, artfully misrepresenting the implications of the redefined “utility” to supposedly derive much the same results, leading to the confusion and conflict I routinely address.

I argue, often, that some of the normative arguments one sees in early classical economics, such as one should not “interfere” with any particular real market, “greed is good,” and so on, are not really consistent with modern neoclassical welfare economics. They’re anachronisms. I suspect it’s that ghost of early classical economics, still lurking in bad economics in the conservative style, that supports this notion there is some independent normative significance to government setting up some ostensibly perfect economic system then becoming inactive. That vision of a minimal, inactive government expressing in eternal laws carved in marble ethics relating to the definition, distribution, use of economic power, then doing nothing, ostensibly creating utopia, fulfilling the divine plan, haunts the imaginations of conservatives. Isn’t it about time economists, philosophers, historians got off their high horses, emerged from their various towers and villas, got to work addressing hoary, unhelpful, quasi-religious rhetoric and themes of folk economics, folk politics, that inform how people actually vote?

Neoclassical Welfare Ethics

I was trying to think of innovative ways to portray or explain in a non-economics context the partial nature of the ethical half-theory of neoclassical welfare economics, and I think I might have one. Want to hear? Fine, I’ll tell it.

What makes neoclassical welfare economics an ethical half-theory in realistic contexts is that while it clearly has some normative or ethical content, the resolving of interpersonal conflicts, a significant part of ethics, is meant to be exogenous to that theory. That’s because the normative content of modern neoclassical welfare economics is (ostensibly) limited to the preference rankings of individuals, rather misleading called “utility,” but a type that is undefined (or in older formulations, inaccessible) in interpersonal contexts. Imagine now a more general ethical theory, say called “neoclassical welfare ethics,” that has that same feature. Let’s think about what it says, how it relates to reality, and how it might be misinterpreted in a realistic context, used for rhetorical effect. 

Let’s take it out of the world of economics and the ethics of economic power. Say one is a guard in a Nazi murder camp thinking about normative issues like what one ought to do, or advise others to do, about another guard, who is about to follow orders and kill an inmate. Say the guard’s preference rank from lowest to highest is not kill inmate, kill inmate. The inmate’s preference rank from lowest to highest is be killed, not be killed. They may have other preferences as well, about ethics say, but let’s just concentrate on those for now. If one does nothing, or fails to advise others to do anything, such as question the orders, ask for a second opinion, intervene, hatch a plot, whatever, then things will go down on schedule and the guard will follow orders and kill the inmate.

What does our theory say? Well, first there’s no way to compare the “utility” of inmate to guard because interpersonal comparisons are undefined (or impossible), so one will be ethically indifferent on that issue. Second, the current situation is Pareto “optimal” or “efficient.” A situation is Pareto “optimal” or Pareto (or “economically,” sorry) “efficient,” if one cannot increase one person’s “utility,” that is, move up his or her preference rank, without decreasing another person’s “utility,” that is, move down his or her preference rank. That bit is easy peasy. But now for the difficult part. How does our neoclassical welfare ethics relate to ethics relevant to the real world, to real people, to oneself, to others? How should one explain to others what the theory implies in reality?

Well, one thing one can rely upon is the theory is correct in a logical sense. Also, the ethical proposition everything else equal, all questions of interpersonal ethics solved or irrelevant, it’s nice if people move up their preference ranks, seems plausible in certain cases. It’s obviously more plausible if one is contemplating people who are thinking correctly, know what they’re doing, are not addicted, under duress, deceived, manipulated, etc. But let’s not worry about that sort of thing here and focus our attention on interpersonal conflict. One may wonder already at the level of broaching (Pareto) “efficiency” if the theory is truly only about the preference ranks of individuals, because those provide no basis for opinions or concerns relating to interpersonal trade-offs. However, that depends what one does with it. Used as a decision rule, the concept conveys additional normative content implying one should stop when such trade-offs threaten to occur, so some built-in bias or preference for the status quo, despite ostensibly being indifferent to such trade-offs. True indifference would imply, well, indifference. Possibly tossing a coin, sometimes making the interpersonal trade-off, sometimes not? Certainly at least not offering any commentary or pushback if anyone else chooses to make an interpersonal tradeoff or not. The results of fake indifference, in the form of professing indifference but promoting the status quo solution, are indistinguishable from supporting the status quo solution for any explicit reason, and one supposes that the main reason one might be tempted to use it. The rhetorical advantage of fake indifference in this situation is one might use it to support the status quo solution, by not intervening or suggesting anyone else intervene, without bringing up any potentially controversial ethical rationale for doing so.

More generally, after explaining the theory’s normative indifference to the fate or welfare of the inmate, and possibly continuing on to discuss the (Pareto) “optimality” or “efficiency” of the status quo outcome, does one have any other responsibilities to oneself or others? Well, one thing that seems pretty apparent is confusion and conflict may result if one simply goes about explaining what neoclassical welfare ethics has to say about the situation without caveat because some may suppose you propose it as a guide to action. That is to say, some might suppose one is suggesting others should adopt also in reality the normative propositions applicable in that theory, that they should treat it as a full ethical theory: they should be indifferent or perhaps support the status quo by doing nothing. One might want to call using the theory in that inappropriate way “bad neoclassical ethics in the conservative style” or something like that, just to let people know one supposes there is some problem in the application, if not the internal logic of the theory itself. It’s confusing because usually when people talk about an ethical or normative theory, they have in mind a full ethical theory that purports to explain what is normatively or ethically correct in reality. They don’t have in mind an odd, random, idiosyncratic partial ethical theory. “If one considers only the welfare of my left big toe, the normatively or ethically optimal social outcome is to devote all resources to slipper construction,” is just a quite uncommon form of ethical discourse. One might want to stress, “Just about my toe. You get that, right?”

So to be intellectually responsible, one should really probably stress the partial aspect of the theory, that it's only about the preference ranks of individuals, it's not at all about interpersonal ethics, which some may reasonably suppose significant in that context. Indeed, one might suppose the interpersonal ethics of the situation is what most, including the ethicist, interlocutors, guards, even inmates would find the most significant element of the situation, and the issue of intrapersonal preference ranks a secondary consideration. Yet it’s also true if one hypothetically removes those more significant ethical considerations, one may be left with only the formerly insignificant, relatively trivial issue of individual preference ranks and the resulting ethical indifference implied by looking only at that.

One may, of course, “weight” the preference ranks of individuals using “social welfare functions” as a way to address the exogenous interpersonal ethics, leading to a distinct “general welfare ethics,” but that seems a rather confusing, inapt, way to discuss the relevant ethics. Also, weighting the preference ranks of individuals and using them in interpersonal contexts is inconsistent with those individual preference ranks as “utility” being undefined in interpersonal contexts. But maybe with the older formulation where “utility” still defined there?

So that’s basically what’s going on with the ethical half-theory of neoclassical welfare economics. A great todo is made of the ranks of certain preferences for individuals, of indifference within that theory to interpersonal conflict, but also pointing to fake indifference. And bad economics in the conservative style takes the limited yet misleading ethical content in the theory of neoclassical welfare economics and runs with it, misstating its relationship to the real world, real people, real ethics, for manipulative rhetorical effect.

Normative Roadblocks And Bad Economics

I thought this week I might revisit fake indifference and normative “roadblock” rhetoric in bad economics in the conservative style. I did a related post recently on “economic efficiency” and thought I should complete the set.

One famous conclusion of neoclassical welfare economics is that unrealistic theoretical constructs called “perfectly competitive markets” are normatively laudable with respect to individual preference rankings in the sense they exhibit “economic efficiency.” “Economic efficiency,” or “Pareto efficiency” after the Italian fascist who coined the definition, relates to individual preference rankings, there called “utility,” and means no one can move up his or her preference rank without someone else moving down his or her own rank.

Another famous conclusion of neoclassical welfare economics is the normative equivalence, within the context of that theory, of all perfectly competitive, economically efficient, market outcomes. This “distributional indifference” holds for both economist observers, who are meant to consider only individual preference rankings, and the ant-like theoretical ciphers themselves, who are presumed to have no preferences relating to interpersonal ethics, economic systems, etc. Within the theoretical, unreal world of neoclassical welfare economics, which I often call the Fairy Land of Economic Theory to distinguish it from reality, the only sensible normative advice is to try to move toward any perfectly competitive market outcome, never mind which one. That conclusion breaks down in reality when the interpersonal ethical issues excluded from the Fairy Land become relevant. Any two outcomes that differ by how interpersonal conflicts of preferences are resolved will not appear normatively equivalent to real people. That will be true not only for any two perfectly competitive, economically efficient outcomes, but even for any two outcomes where one is perfectly competitive, economically efficient and one not, but which differ by how interpersonal conflicts of preferences are resolved. In the real world, those willingly constraining themselves to the (now) ethical half-theory of neoclassical welfare economics are meant to be indifferent to those ethics because they’re exogenous to that theory; they’re not meant to oppose those ethics as illegitimate, baseless.

The rhetorical program of anti-democracy bad economics in the conservative style is an elaborate, multi-pronged attempt to misstate the relationship of neoclassical welfare economics to reality to reproduce in reality the conditions and conclusions that apply in the Fairy Land. The most typical expression of bad economics in the conservative style is someone arguing against those promoting some economic policy or other, based on exogenous ethical considerations relating to interpersonal ethics, because it “interferes with” or “distorts” market outcomes. One supposes the reason they engage in fake indifference is they support the interpersonal ethics expressed in whatever proposed approximation of a perfectly competitive, economically efficient market they’re talking about, although some may, of course, be sincerely confused. Recall what makes bad economics bad is not the expression of interpersonal ethics but the way it’s done, the misstatement of the implications in reality of the arguments relating to perfectly competitive, economically efficient outcomes from neoclassical welfare economics.

Let’s look at two rhetorical techniques associated with bad economics in the conservative style. One is encouraging people to be more like the interpersonal ethics-free ciphers of the Fairy Land, suggesting equity, interpersonal ethics are nothing but baseless virtue signaling. Arguments in favor of strictly egoistic morality or amorality are highly controversial and inconsistent with the significance most forms of ethical philosophy assign to the issue of how one ought to resolve interpersonal conflicts of preferences, needs, wants, rights, and so on.

Another rhetorical technique is to focus on the normative significance of economic efficiency to suggest one should focus on that first, get to some approximation of a perfectly competitive, economically efficient market, then fix it by moving to another, if people so prefer. That’s an example of what I call a normative “roadblock” argument because it’s used in bad economics in the conservative style to inappropriately engage in exogenous ethics in an indirect way by throwing up impediments or roadblocks to expressing certain ethical views. One isn’t halfway to where one wants to go if one attains a perfectly competitive, economically efficient outcome one objects to on the basis of interpersonal ethics. It’s not something everyone can or will agree based on the limited normative significance of individual preference ranks. Policies meant to pursue or promote any particular real approximation of a perfectly competitive, economically efficient outcome can and typically will crowd out or at least complicate pursuing outcomes expressing the interpersonal ethics of some and is not true indifference. It’s not necessarily easier, more feasible, less costly to express interpersonal ethics one way than another, say by addressing the distribution of economic power rather than the definition of economic power (legal property rights), regulating markets, or just not using markets. Indeed, if one considers the incentive structures of labor and capital markets a component of a general perfectly competitive market, it’s not even clear it’s sensible or consistent to say one wants to maintain such a market while revising the distribution of economic power. In this context, it may also be noted the same democratic government expressing the same subjective ethics of voters is responsible for laws relating to not just the definition, distribution of economic power, but the choice to regulate or not use economic power in markets.There is no basis in neoclassical welfare economics to draw distinctions in that area. For example, it’s perfectly consistent with that theory for voters to decide to use economic power in markets to allocate most goods, but decide to allocate a vaccine by medical need instead. That result doesn’t imply all reasons to regulate, revise, not use any real market structure are normatively equivalent or that one cannot promote such actions on a misapprehension of facts, on ethical propositions voters disagree, or on an ignorance of unintended consequences.

If you hear someone opposing some policy or other because it interferes with or distorts ostensibly (economically) efficient market outcomes, put your critical faculties on high alert. That language indicates anti-democracy bad economics in the conservative style. Ask those expressing such ideas to drop the pretense of basing their thinking only on the ethical half-theory of neoclassical welfare economics and instead honestly explain and defend the interpersonal ethics involved. Don’t get played, get real.

Free Markets And Bad Economics

I thought this week I might say a few words about conservative “free market” rhetoric. It involves a sort and level of bad economics beyond even what I normally discuss, and I don’t often bother. But there’s a lot of it about, so maybe worthwhile.

Starting at the most basic level, it may be sensible to contrast the idea of a “free market” with how economists discuss market structures and attributes in real neoclassical welfare economics, where one will likely never hear that funny phrase. In real neoclassical welfare economics, a certain theoretical market structure, the so-called “perfectly competitive market,” without so called “market failures,” is presented as normatively laudable relative to the considerations in that restricted ethical half-theory. A “free market” defined as whatever real market structure happens to exist with whatever market failures happen to apply is not cast as particularly normatively laudable. So in real neoclassical welfare economics there’s nothing special about a “free market,” defined in that way. Making any given “free market” into any semblance of a theoretical “perfectly competitive market” defined using various false but simplifying assumptions like full information, full rationality, and so, may take quite a lot of regulation and is hardly “free” in that sense.

This suggests potential equivocation on the term “free” in the popular mind such as, perhaps, once the conditions of a supposedly laudable “perfectly competitive market” are implemented to whatever degree, consumers and business are “free” to act under those legal conditions. That possibility seems a good segue to the level of confusion I’m usually on about, why calling any real approximation of a “perfectly competitive market” a “free market” is rhetorically misleading, which is that all markets rest on coercive laws relating to economic power. In a democracy, the coercive laws on economic power that underlie real markets are based in the views of the voters on the ethics of the definition, distribution, use of economic power in markets to resolve particular or all interpersonal conflicts of preferences. Yes, one is then free to act under the conditions stipulated by those laws, but then one is always free to act under the conditions stipulated by laws and other external factors; there’s nothing conceptually special about doing that in a market setting.

Let’s have an example. If society decides to allocate scarce vaccines according to economic power in markets, then those with economic power, and the requisite desire, will be free to get the vaccine if they choose, never mind their medical need. However, if voters decide for ethical reasons to allocate the scare resource of the vaccine by medical need, then those with medical need, and the requisite desire, will be free to get the vaccine if they choose, never mind their economic power. Which situation is more free? It’s just one more aspect of looking at the ethics of resolving interpersonal conflicts of preferences. One person may attach great significance to the setting up of laws relating to economic power, markets, another to considerations that may apply only in particular cases. The point is the same considerations, voter ethics expressed via democratic government, operate in both cases, the setting up of laws relating to economic power and markets, and the setting up of laws relating to vaccine distribution. Proposed distinctions are awkward.

This leads some to the notion the reason laws relating to economic power are normatively significant is not because they’re from voter ethics expressed via democracy, but the essentially anti-democracy view they’re significant on some other basis, not involving voters. This, in turn, leads some to the notion people are “free” when voters cannot express their ethical values via democratic government, and thus are free under fascism, in the case of undemocratic government expressing conservative ethics on economic power. The idea “freedom” is when government expresses one’s own views on the ethics of economic power and prevents other voters getting involved can also lead to the sort of fake anarchism / crypto-fascism one finds in creeds like “libertarianism” and “Austrian” economics.

When you encounter people talking about “free markets,” please understand that phrase has the markings of anti-democracy bad economics in the conservative style all over it. Have a care. It’s not real economics but rhetoric, designed to deceive, mislead, manipulate. When people talk about “free markets,” they’re not trying to sincerely discuss any result from real neoclassical welfare economics, they’re playing insincere rhetorical word games to create confusion and conflict about economic and ethical issues.

Efficiency and Markets

I thought this week I might revisit the idea of efficiency as it relates to markets. I know I’ve done it before, many times, but I was reading a young fellow waxing eloquent on the efficiency of markets and it brought it to mind again. Sound a plan?

Efficiency must be defined relative to some goal or objective. Nothing is efficient in general, with respect to everything. Jumping off a cliff is an efficient way to get to the bottom, but not necessarily getting there alive. One must always ask, efficient with respect to what? The efficiency of markets in a welfare economics sense is typically defined with respect to individual preference rankings, there called “utility,” in the rather arcane sense no one can move up his or her preference ranking without someone else moving down his or her own. That’s called “economic efficiency” or “Pareto efficiency” after the Italian fascist who came up with it. My point here is simply it’s not necessarily efficiency with respect to what some may suppose the most normatively significant goal or objective. Let’s have an example.

To make the issues more obvious, imagine a quite unequal distribution of economic power in which most of it is in the hands of a very pampered big shot indeed, the Heiress of All. The Heiress has plenty of most things but is interested just now in very fancy jeweled eggs. A theoretical perfectly competitive market will allocate scarce resources to meet that preference set and be “economically efficient” at the same time. That’s good, right? It’s not as though there’s no sensible ethical content to “economic efficiency.” Seems a nice thing to have. 

But for some, the ethical significance of the “economic efficiency” of that market may pale in comparison to, say, efficiency with respect to improving the welfare of the starving commoners. Indeed, some may suppose the Heiress’s preferences have altogether too much significance. Frankly, some may not give a damn if the Heiress of All manages another jeweled egg or not. The “economic efficiency” of that market may be a relatively insignificant consideration for them, based on their ethical views on the definition, distribution, use of economic power. Because of the existence of other people, the scarcity of resources, the ubiquity of interpersonal conflicts of preferences over resource use and other matters, we’re never truly in a situation in the real world where only individual preference ranks matter in terms of ethics. 

Of course, if one agreed the ethics of the definition, distribution, use of economic power in markets to resolve interpersonal conflicts of preferences, supposed all more serious interpersonal ethical issues resolved, then “economic efficiency” would appear more significant. To reprise our discussion from last time, one may suppose considering those exogenous interpersonal issues fine for some but those operating within neoclassical welfare economics are meant to confine their ethical thinking to individual preference rankings, “utility,” economic efficiency. That’s fine, if presented as an ethical half-theory. However, if one tries to pass it off as an ethical full theory, propose others give more weight to “economic efficiency” in real contexts than seems ethically sensible or appropriate to them, then that’s not fine, not at all.

An advanced example is insisting economic efficiency is normatively paramount so interpersonal ethics cannot be addressed unless that condition is met, a form of fake indifference I usually describe as setting up of arbitrary roadblocks to expressing interpersonal ethics. I’ve discussed such roadblocks before and will do again. They include stratagems such as insisting the ethics of resolving interpersonal conflicts of preferences be addressed only via the distribution of economic power rather than by regulation or choice to use economic power. What one typically sees in anti-democracy bad economics in the conservative style is people arguing no one should interfere with or distort or fail to pursue or promote the “economic efficiency” of some real market, which is fake indifference of a rather more obvious sort.

Real neoclassical welfare economics, in contrast, recommends those using that ethical half-theory acknowledge the existence and significance of the ethical issues external to that theory in realistic contexts but express indifference to them, not oppose them. That is, purveyors of real neoclassical welfare economics understand ethical considerations exogenous to that theory relating to resolving interpersonal conflicts of preferences are a legitimate reason, even within the context of that theory, to depart from “economic efficiency.” The ethical half-theory of real neoclassical welfare economics does not support one using that theory to cast interpersonal ethics as illegitimate, something to oppose as baseless, etc. It recommends indifference, acknowledging those ethics as relevant but beyond one’s purview.

When one reads or hears anyone talking about efficiency and markets, one should put one’s critical faculties in high alert. It’s a concept often used in rhetorically underhanded ways to play funny word games, equivocate on terms, create unnecessary confusion and conflict.

A Tale of Two Normative Propositions

How about a bit more economics this week? I thought I might discuss two subtly different normative or ethical propositions I believe are often conflated in the context of applied economics to comical and unfortunate effect. Sound a plan? One proposition leads to viewing neoclassical welfare economics as an ethical half-theory, basing normative evaluation of policy partially on normative inputs from outside. The other leads to viewing that theory as a full ethical theory, evaluating policy on that basis alone. 

The first proposition is from real neoclassical welfare economics and says economists speaking as economists using that theory should not take up the ethics of resolving interpersonal conflicts of preferences, should restrict their discussion to “utility.” Let’s discuss briefly. The factors that play into resolving interpersonal conflicts of preferences in economics involve the ethics of the definition, distribution, use of economic power in markets to address particular conflicts, or not. Those ethics are external to neoclassical welfare economics. The “utility” I just mentioned is not just any old definition of utility one likes, and the term has a long history in philosophy and many potential definitions. It’s the particular “utility” that meets the definition and requirements of neoclassical welfare economics. The only empirical indication associated with the relevant sort of “utility” in neoclassical welfare economics is individual preference rankings, and most economists now define it simply to be that with no further content, just the ranking itself. One may also define it as an internal subjective feeling of satisfaction from individual preference fulfillment, but only if one specifies the only empirical indication of that feeling is individual preference rank. That works, but leads to some rather dodgy ethics. I discuss the dodgy ethics that follow from that older and now uncommon take on “utility” in neoclassical welfare economics in my blog and book. The point here is simply one cannot make “interpersonal utility comparisons” in modern neoclassical welfare economics. There are other sorts of economic theory that get around that restriction, confusingly often by introducing factors relevant to other sorts of utility, then “weighting” individual preference rankings, pretending to add them together, compare them, and so on. Those other sorts of economic theory fall under the rubric of “general welfare analysis,” basically rather dodgy, awkward, confused ethical philosophy that doesn’t really express the same normative inputs or generate the same conclusions as real neoclassical welfare economics. Anti-democracy bad economics in the conservative style is a misinterpretation specifically of the normative argument in real neoclassical welfare economics, not the wide ranging, anything goes discussions of “general welfare analysis.” Those operating under the influence of this first proposition understand they cannot evaluate economic policy in realistic contexts purely from within neoclassical welfare economics. It requires ethical inputs relating to the ethics of economic power external to that theory.

Returning to the main point, the second proposition is from bad economics in the conservative style and says economists speaking as economists should tell others as well to not take up the ethics of resolving interpersonal conflicts of preferences, go beyond “utility.” In direct contrast to the first proposition from real neoclassical welfare economics, which is ostensibly intended to eschew ethical controversy by limiting the scope of economic theory, rendering it an ethical half-theory, this second proposition is very ethically controversial. It’s controversial because resolving interpersonal conflicts of preferences make up the lion’s share of ethics, so it’s basically a proposition people should be amoral in the sense of being indifferent to others and to considerations of fairness, justness, equity, and so on. Indeed, one supposes the only reason that proposition from the ostensibly full ethical theory of bad economics in the conservative style is taken seriously at all involves some sort of selective perceptive involving acceptance of status quo ethics on the relevant issues. A common rhetorical conceit from bad economics in the conservative style is to cast as indifference to the ethics of resolving interpersonal conflicts of preferences indifference to the ethical basis of the status quo resolution, not indifference to that resolution. That’s not true indifference in the sense relevant to neoclassical welfare economics because it introduces an additional normative or ethical principle, that one should support the status quo regardless of its ethical basis, which cannot be justified on the basis of “utility.” Under the influence of that rhetoric from bad economics in the conservative style, the second proposition transforms into something like, no one should question the ethical basis according to which interpersonal conflicts of preferences are resolved under the status quo. This then informs the common conservative view democracy is ethically bad because it allows voters to express unjustified, false ethics relating to resolving interpersonal conflicts of preferences, allocation of scarce resources, engage in empty and unethical “virtue signaling.” Those operating under the influence of this second proposition propose they can evaluate economic policy in realistic contexts purely from within neoclassical welfare economics and they oppose ethical inputs relating to the ethics of economic power external to that theory.

The two propositions are often conflated using the idea of economists just talking as economists, but that’s ambiguous between economists as such giving an ethical half-theory, correctly expressing indifference, and economists as such giving their own full ethical theory. Any full ethical theory may always be said to be just from the point of view of adherents. Duty based theories just the views of those who support those theories, religious theories just the views of who support those theories, and so on. It’s not the point.

Real neoclassical welfare economics has certain normative inputs, applied under certain factual premises, and generates certain conclusions. Bad economics in the conservative style has different normative inputs, applied under different conditions, gives different conclusions. Conservatives have had great fun playing bait and switch between the two intellectual artifacts, misleadingly taking up criticisms of bad economics in the conservative style by referring to real neoclassical welfare economics. Know enough economics to not fall for such nonsense.

Democracy And Fascism

I thought this week I might go over the conservative, right wing rhetoric that transforms democracy into a sort of fake “fascism” and actual fascism into freedom or liberty. I’ve talked about it before, many times, but I thought a formal storm might be helpful. The keys involve playing games with the notion of “tyrannical” or “totalitarian” government and also, in my opinion, neglecting the essential features of fascism, the nature of ethics, and involving fake anarchism. Let’s go over it again in detail, shall we?

I often mention the ethics of the definition, distribution, and use of economic power in markets to resolve particular interpersonal conflicts of preferences, ethics I characterize as external or exogenous to the normative argument in neoclassical welfare economics. Those are the ethics that determine how interpersonal conflicts of preferences in economic settings are resolved, scarce resources allocated, an issue that goes beyond the “utility” in neoclassical welfare economics, which cannot support interpersonal utility comparisons. The crucial issue here is where are those ethical judgments coming from? Who makes them? In our society, they’re made by voters via democracy under the US Constitution. As such, conservatives and liberals have long argued about such issues based on their own ethical beliefs. However, some common ethical arguments in conservative ideology go beyond democracy to suggest the ethics of economic power are rooted in immutable natural or divine law or other things and should thus be protected from the ethical opinions of voters and democracy. In some cases, they argue ethical judgments relating to economic power are written into the US Constitution, a seemingly unlikely proposition. However, as the US Constitution may also be revised or amended using democratic means, albeit not easily, many reject even that. Crucially, according to these conservatives, if democratic government passes laws relating to economic power inconsistent with conservative views on the ethics on economic power, then democracy is “tyrannical” or “totalitarian.” However, conservatives apply that description to not only democracy, but undemocratic, authoritarian, right wing fascism as well as left wing communism. Thus, in conservative ideology, “fascism” is often equated with both democracy, at least of an “active” sort, and communism. Indeed, conservatives are often so concerned to establish government delivering unwelcome laws relating to economic power is tyrannical or totalitarian they veer into fake anarchist rhetoric and start talking about government or the state, in general, as invariably that. However, applying the egoism, selective perception, bias common in conservatism, they don’t see even undemocratic, authoritarian government expressing their own views on the ethics of economic power as tyrannical or totalitarian but rather as expressing freedom and liberty.

I’ve argued the core or essential feature of fascism is that it’s undemocratic, authoritarian government in defense of conservative views on the ethics of economic power specifically against “leftist” views on the ethics on economic power delivered via democracy or otherwise. That, I believe, was the motivation of the old fascist movements in Europe and the primary source of their support. One can hardly understand the deadly animosity between right wing fascism and left wing communism if one sees them simply as two examples of tyrannical government. In that context, one may say the common but simplistic notion right wing fascism was “totalitarian” may be somewhat misleading. Some now don’t seem to realize fascism defended and supported private property and business, labor and capital markets, finance, banking, and so on. It’s unfortunate the historical analysis of fascism in the USA is so muddled, one supposes to avoid implicating conservatism, ignoring fascism’s basis in opposing “leftist” ethics on economic power, preferring to dwell on its nationalism, nativism, militarism, racism, and so on. One suspects concern that if the conservative, anti-“leftist” animus of right wing authoritarian fascism, its goal of defending conservative ethics on economic power, including from democracy, were made too explicit, conservatives in the USA might find it entirely too attractive. Brings to mind that prior to European fascism’s descent into madness, it was not really considered a problem or threat by the economically powerful establishment of most nations, including the USA, who one supposes rather hoped it might be good for business, wished it well.

The result is some or many conservatives now associate democracy with “fascism,” and associate real fascism, pared to its essentials of undemocratic, authoritarian government power supporting conservative ethics on economic power, with freedom or liberty. Indeed, by extension, conservative rhetoric commonly now designates any voter who supports any law they oppose as tyrannical, totalitarian fascists, communists, Marxists, and so on, not just Democrats, liberals, but atheists, gay people, feminists, educated people, etc. It’s an incorrect conceptualization of the issue that has led to the curious modern phenomenon of conservatives fighting against democracy and the freedom and liberty it entails, and for fascism, while proposing they’re fighting against fascism and for freedom and liberty. An important element of contemporary fascist rhetoric meant to support that project is to rhetorically equate fascism with “leftism” so they can address their essential fascist concern of fighting “leftism" while presenting it as also fighting “fascism.” 

If you’ve read my posts before, you’ll know I place much of the blame for this unfortunate bit of confusion and conflict on academic economists and their often studious inability or unwillingness to aggressively confront anti-democracy bad economics in the conservative style. Anti-democracy bad economics in the conservative style, intellectually distinct from neoclassical welfare economics, obscures the role of economic power in markets, the related ethics, and thus also the important role of democracy in economic systems using markets. If you hear conservatives discussing communism or fascism, get a grip on whether they’re referring simply to authoritarian, undemocratic political arrangements, or also to those creeds’ conflicting views on economics, the ethics of economic power, etc. If you hear conservatives equating democracy with tyrannical, totalitarian, authoritarian government, fascism, communism, because democracy may enact laws they don’t personally approve, inquire into their understanding of those terms, the form of government they propose superior.

Liberalism Yet Again

I know I’ve done it before, but can we discuss the meaning of traditional American “liberalism” again this week? It's just I suspect a concerted conservative rhetorical effort to muddy the water or even remove the word from our political vocabulary entirely.

For many decades, the traditional juxtaposition in economic and social policy in the USA has been between “conservatives” and what we’ve always called “liberals.” However, these days it’s not uncommon to find people who profess to not know the difference or misstate or ignore it. Part of this seems just typical conservative wordplay designed to confuse and mislead, so equivocating on different definitions of liberalism as, for example, “classical liberalism,” or “neoliberalism,” or “liberalism” as it’s understood in the UK and elsewhere, and so on. For historical reasons, any reference to society or anything perceived as “leftist” was unacceptable in the USA, so “liberalism” was used to denote positions that might be called differently in other countries who kept older definitions like “classical liberalism” (US conservatism). Additional confusion then attends the word “neoliberal," which in the US means a departure from or rejection of “liberal” (US) economic thinking, while in other countries like the UK seems to mean a return to or resurgence of “liberal” (UK) / conservative (US) economic thinking. However, part of it seems to involve a genuine confusion relating to what traditional American “liberalism” was and is actually about, what ideas and values it represents, how it differs from what we call “conservatism,” and so on. So let’s just review, shall we?

With the rise of anti-democracy sentiment on the conservative side, be it of the fascist, theocratist, or anarchist variety, the first thing that must be noted is traditional US liberalism (hereafter just liberalism) is pro-democracy, supports the US Constitution. So that’s currently the top level distinction between conservatism and liberalism in the USA. Liberalism is invariably pro-democracy while conservatism can be, and sometimes is, pro-democracy, but is increasingly anti-democracy, authoritarian.

Formerly, when both US liberals and conservatives reliably agreed the ethos of democracy, the US Constitution, the distinction didn’t involve views on democracy, per se, but on economic policy. So at the next level one can discuss the economics of liberalism and conservatism. Economic conservatism is about distinctive normative, ethical views relating to the ethics of the definition, distribution, use of economic power, including markets. It’s closely associated with the normative program of bad economics in the conservative style and its offspring. In practice, economic conservatism is about opposing voters wanting to express via “activist” democratic government ethical views on economic power inconsistent with conservative views, which may “interfere with” or “distort” economic policies or outcomes conservatives endorse. When conservatives suppose voters are unreliable in that area, may make the “wrong” normative, ethical decision, feel it’s too important to be left to the “mob rule” of democracy, that’s when pro-democracy conservatism gives way to anti-democracy conservatism, fascism. There’s an interesting progression in conservatism involving first trying to convince voters of conservative ethics on economic power, then falsely claiming such issues are expressed in the US Constitution and cannot be revised, to finally just terminating the US Constitution.

Economic liberalism may be defined in opposition to economic conservatism. It rejects simplistic market utopianism, not only recognizing “free” markets may feature so-called “market failures” requiring regulation, but disputing conservative ethics on economic power, markets. Policies designed to augment, revise, improve market results by attending to ethical concerns like fairness, justness, equity, (real) utilitarian, welfare concerns are products of liberal economic thinking, although some conservatives accept attending to “market failure” only. Some examples: Social Security, Medicare, Medicaid, Obamacare, help for the economically weak, public education, worker and consumer protection regulations, minimum wage laws, environmental protection regulations are products of economic liberalism. A timely one I always find illustrative is that distributing a scarce vaccine by medical need rather than economic power expressed in markets is based on liberal economic reasoning. That mechanism is inconsistent with standard conservative economic thinking.

In the social realm, liberalism promotes both a realm of personal liberty and a realm of law, when the liberty of different people conflict in a significant enough way, beyond merely offending someone’s sensibilities, religious views, what have you, to make law necessary. Social conservatism is typically about reducing the realm of personal liberty beyond what liberals would support in order to enforce certain views relating to religious views, primarily. Conservative “libertarianism” is typically false, rhetorical, with unsystematic takes on law. Insincere, rhetorical, tricksy, conservative “libertarianism” can be made consistent with any proposed conservative infringement on personal liberty by artful wordplay involving whose liberty to do what and why and how others affected are meant to be considered or not. Just as liberalism goes with democracy, economic liberalism tends to go with social liberalism. However, economic conservatism has a less consistent relationship to social conservatism, sometimes linked through the proposed ethical basis of economic power, sometimes less related.

If you think democracy, the US Constitution, good ideas, think markets are sometimes, maybe even often pretty good but support policies to augment or improve them, make them more fair, just, equitable, welfare enhancing, or consider alternatives as appropriate, you’re a liberal. Liberalism was for some time, say from the 1930s to the 1960s, the dominant political view in the USA. Starting in the 1980s to present, its intellectual opponent, conservatism / “neoliberalism” has reigned. Is it time for a resurgence of traditional American liberalism? Why do conservatives in the USA try so hard to obfuscate, mislead, confuse people about liberalism? Perhaps they want voters to think there’s no real alternative to conservatism, or the only alternatives are undemocratic, authoritarian. Don’t buy it. Consider liberalism.

De Gustibus Est Disputandum

I feel lately I’ve been getting away from discussing economic theory, per se, so maybe this week we can talk about something that occurred to me the other day about the individual preference rankings that form the normative basis of neoclassical welfare economics.

I’ve discussed before how neoclassical welfare economics is based on a distinctive take on “utility” that defines it to be, or makes it equivalent in practice to, individual preference rankings. That sort of “utility” is undefined or inapplicable in interpersonal contexts. The particular issue I was thinking about the other day involves a normative proposition about individual preference rankings meant to apply to economists qua economists generally expressed rather facetiously in Latin as de gustibus non est disputandum. If your ancient languages are a bit rusty, it just means economists qua economists are not meant to dispute, evaluate, delve into the normative significance of their subjects’ individual preference rankings, second guess them, discredit them, whatever. 

Within the Fairy Land of Economic Theory, the proposition presents no particular normative difficulty or controversy. Cipher X has preference rankings A > B > C. Do you dispute it? No? Me neither. Seems fine. Whatever. Not very controversial, is it? But, of course, things get a bit more normatively, ethically complicated, controversial in the real world. Why? For one thing, real people, possibly unlike the ciphers of the Fairy Land, may be misled, confused, manipulated, tricked, and the normative significance of those preferences is unclear. I say “possibly” because the famous assumptions of perfect information, rationality applied in the Fairy Land are often introduced as requirements for the normative argument relating specifically to perfectly competitive markets, not necessarily generally to the Fairy Land. Therefore, it’s not entirely clear if the theoretical ciphers populating the Fairy Land are meant to uniformly have perfect information, be all knowing, perfectly reasonable, immune from manipulation and error, when analyzing the normative or ethical arguments presented. This is where confusion within economic theory between ethics and science or maybe engineering modeling, positive and normative, is and ought, kicks in. In a normative or ethical argument, one needs to know the factual premises meant to apply to an argument to evaluate it.

Anyway, to return to the plot, the preferences of real people, as opposed to theoretical ciphers, may clearly be affected by external forces, other people, and in real market systems vast amounts of money are spent on advertising, marketing, to dispute, indeed alter preferences. Attending to the issue I call “actors and roles” clarifies that behavior is consistent with profit maximizing behavior on the part of firms, but of course the de gustibus normative principle was never meant to apply to them as such, only to economists qua economists. As far as voters, the real subjects of economists proposing to discuss reality, voters dispute preferences indirectly by supporting laws placing boundaries on, or prohibiting, false and misleading commercial speech designed to manipulate preferences. It’s awkward because real people, voters, are the people economists qua economists are meant to be talking to (unlike the Fairy Land, where economists are meant to be talking not to the subjects, the theoretical ciphers, but an implied third party also outside the system). Of course, again, de gustibus is not a normative principle meant to apply to everyone, subjects, only to economists qua economists in the context of the ethical half-theory of neoclassical welfare economics. That’s where it’s uncontroversial, not in reality.

Why would voters care if, say, preferences were manipulated by lies, fakery? If only some individual were involved, one assumes many voters might not care. No matter how foolish the preferences, that individual is still satisfied in some way when they’re met. It’s hard to avoid the suggestion the reason voters care is again this issue of other people being involved, scarce resources going to arguably foolish, fabricated preferences based on lies, that might otherwise go to other more normatively significant preferences. Considering the interpersonal context, real people spend a great deal of time, effort, money to dispute, challenge, change other people’s preferences affecting others in any number of ways: law, ethics, religion, literature, popular culture, political debate, and so on.

Why do I bother saying all this? The normative content developed within real neoclassical welfare economics is restricted to individual preference rankings, no interpersonal conflicts can be addressed, and the preferences ranked by individuals are unevaluated. It’s a normative, ethical argument that has little relevance to the real world, where the lion’s share of ethical controversy relates to resolving interpersonal conflicts, including of preferences, as allocating scarce resources, and involving disputing preferences. Attempts to apply the normative or ethical reasoning in neoclassical welfare economics to the real world are generally expressions of bad economics in the conservative style, in which the necessary controversial ethical content is slipped in one way or another. If one wants to dispute the normative argument in neoclassical welfare economics applicable in the Fairy Land, that’s fine. If one wants to dispute the normative argument in bad economics in the conservative style applicable to reality, that’s fine. Two different things. Watch for the rhetorical game of jumping back and forth between the arbitrary, contrived conditions and ethics of the Fairy Land and reality, between the ethical half-theory of neoclassical welfare economics and more complete full ethical arguments relevant to the real world. Watch also for a rhetorical bait and switch between the normative concepts and arguments in neoclassical welfare economics, on the one hand, which relate to bad economics in the conservative style, and more open-ended “general welfare analysis” on the other.

Small Fascism

Maybe we can talk this week about what I think of as “small” or “limited” fascism and its seemingly ambiguous status in the eyes of many conservatives, Republicans, right wingers in the USA. Sound a plan? Let’s do it.

The core of fascism is that it’s undemocratic, authoritarian government to defend conservative views on the ethics of economic power against “leftist” views delivered from voters in a democracy or from authoritarian communism, which fascists tend to lump together as equivalent. It’s impossible to come to terms with the right wing movement of fascism if one doesn't understand its entire reason to exist was to fight “leftist” views on the ethics of economic power coming from liberals, progressives, democratic socialists, and also authoritarian communists.

In order to be seen as a viable contender, European fascists found it expedient to argue right wing fascism, like “The Left,” had society’s best interests at heart, believed in welfare state goals, was in fact an alternative, conservative, right wing form of “socialism.” Modern fascists in the USA have taken hold of the social welfare pretensions of the old European fascists, their claim to care about (their) society no less, if not more, than “leftist” socialists, were another form of socialism, to risibly argue fascists were “leftists.” That seems a clueless, uninformed take that misses entirely the main point of contention between authoritarian fascists, authoritarian communists, and supporters of democracy, namely, the ethics of economic power, how society is meant to address them.

The ethics of economic power concerns the issues of the definition of economic power (legal property “rights”), the distribution of economic power, and the use of economic power in markets, or not, to resolve interpersonal conflicts of preferences, allocate scarce resources. The ethics of economic power are exogenous to the normative or ethical argument in neoclassical welfare economics about markets, and people typically have very strong views on them, who should have what and why, what the economy is meant to do, and so on.

Some conservatives in the USA seem to feel if one has a “small” or “limited” undemocratic, authoritarian government devoted to expressing, preserving, protecting conservative views on the ethics of economic power, but having no welfare state pretensions, it’s not really fascism. In their view, it may even be consistent with a sort of democracy if economic issues can be cordoned off as a special area immune from so-called “activist” democratic government. An inactive democratic government that supports conservative views on economic power would be fine. If democratic government constrained to support and not challenge conservative views on the ethics of economic power is impossible, they accept undemocratic government as conservative, right wing, authoritarian government, but feel it’s not yet fascism, per se. I see it rather as “small” or “limited” fascism. Having it the other way seems to me a case of the tail wagging the dog, making the core of fascism irrelevant to the definition of fascism, and making the unnecessary, contingent, insincere periphery the basis of definition.

During the heyday of European fascism, all nations expressed welfare state ideas, promoted social programs, in response to widespread economic suffering during the Great Depression, including democratic USA, communist USSR. There was nothing specifically fascistic about it. And then of course we have the fact fascism in the USA, in fact, does not diverge in any significant way from old European fascism except in relation to the specific word “socialism.” American fascism clearly also has welfare state pretensions, talks about social welfare. Indeed, American fascists talk just as much about what society, “America” wants, what’s best for everyone (of the right sort), as the Nazis ever did in Germany. It hews quite closely as well to the original in many peripheral issues such as racism, nationalism, and other issues.

The innovation in American fascism, if any, is that its social welfare pretensions rely heavily on the market utopianism of anti-democracy bad economics in the conservative style, hardly rhetoric available to the Nazis during the economic upheavals of the Great Depression. Bad economics in the conservative style, by playing games with normative or ethical ideas like socially optimal market results, muddies the water in terms of pretended, false professions of concern for society and authentic or sincere concern. There seems little reason to suppose under the right conditions US fascists will not do exactly as the Nazis did. During times of economic distress they will likely also profess an interest in social welfare programs for some; promote racism, bigotry: resort to thievery, war. Nor is there any reason to suppose undemocratic, authoritarian government in the USA, once established, would be any more concerned about intended limits on their power than were the old Nazi elite, no reason they would choose to remain “small,” by any definition.

What’s my point? Anti-democracy conservatives and Republicans promoting “small” or “limited” wholly or partially authoritarian government confined to promoting, defending conservative views on the ethics of economic power, are fascists, small or large.

The US Civil War And Bad Economics

I thought this week I might discuss some possible connections between the rise of anti-democracy sentiment in the USA, bad economics in the conservative style, racism, bad religion, slavery, and the US Civil War. Why? Some things just never get old.

Those educated anywhere except perhaps some of the southern US states of the old CSA may understand the important role slavery played in the economy of colonial North America and the early USA. Kidnapped Africans were once a very important category of private property in the USA. Laws supporting slavery were originally created by the quasi-democratic or democratic governments of the colonial powers of old Europe, later the USA itself. They expressed the views of the voters on one aspect of the ethics of economic power: the definition of economic power. The ethics of the definition of economic power is about who should legally own what and why. It subsumes property “rights,” although that formulation is famously prone to equivocation between the notion of legal “rights” and ethical “rights,” two very different things. Many voters influenced by pseudo-scientific European racism, bad religion, and one supposes a healthy dose of greed, supported the institution of slavery for the first hundred years or so of the existence of the USA as a sovereign nation. However, in the mid-nineteenth century large numbers of voters in the USA began to turn against the ethics of economic power expressed in the institution of slavery and vote against it, leading to severe social and political tensions culminating in the US Civil War. 

One may say the US Civil War was fought largely over the ethics of economic power and, in particular, the perceived relationship between democratic government and laws generated by democratic government defining that economic power, that is, legal property “rights.” In a sense, there were (at least) two levels of intellectual controversy going on (and you know how much I love level issues): One concerned the ethics of slavery, the merits of racism, religious issues. One concerned the role of democratic government, liberty, freedom, rights. In the view of many southern slaveholders and hangers on whose fortunes or livelihoods depended on slavery, voters via democratic government had no ethical right to pass laws changing the definition of economic power, coming for what they saw as their private property. In the minds of the old Confederates, the war was about tyrannical democratic government trying to take away their liberty or freedom to own others as their slaves, trampling upon their property “rights,” stealing from them, picking their pockets, and so on. Indeed, a common take among southern conservatives even now is that the US Civil War was about “states’ rights,” in particular, states’ rights to decide the issue of slavery, rather than the federal government, as opposed to the ethical and legal issues of slavery, per se. Why states’ rights, in particular? Presumably because they felt they had the votes at the state level to get what they wanted. If not, one assumes the issue would have been local rights, and if not local then individual rights. The man issue was rights superseding democracy.

Of course, not all southern conservatives were on the same page on that. Some supposed the main issue was indeed the ethics of slavery and became vociferous proponents of racism, insisting slavery was ethically proper given the proposed differences between the “races.” Some of those racists developed a hatred for the science, education that called their racism into question, later extending it to science, education calling into question other random dodgy theories as on economics, religion, human sexuality and gender, climate change, and so on. Obviously, the supporters of “race” based slavery developed an underlying hatred for multi-“racial” democracy, which did not respect the proposed science of racism, and involved what they saw as the wrong sort of people having voting rights.

Yet other southern conservatives busied themselves with an obnoxious, ostentatious, belligerent form of Christianity meant to establish, broadcast their own supposed religious, moral superiority as an antidote to the notion support for slavery implied a deficiency in that area. The religiously oriented expressed a natural hatred for democracy as well, as voters might pass laws inconsistent with their theological findings, including about slavery, and especially for democracy espousing separation of church (religion) and state, as in the US Constitution.

The heirs to the conservatives of the old CSA found a natural home in anti-democracy bad economics in the conservative style and its sequelae, which obscure the ethics of economic power and the role of voters, democratic government, in establishing laws in that area. One can’t help but detect some geographical difference in the acceptance and promotion of bad economics in the conservative style, related fake anarchism / “libertarianism,” and even utopian real anarchism, all of which seem especially strong among southern conservatives. Similarly, one can’t help but detect a geographic difference in attitudes toward racism, religion, science, education, democracy, the US Constitution, the law, our national government, although views typical of the old CSA are now typical in rural areas, small towns throughout. It wouldn’t be unusual today to drive though a rural or country area in the northern USA, once the land of proud yankees fighting for democracy, the US Constitution, law, the USA, against slavery, only to find the stars and bars of the old CSA wafting in the wind. Thus, as others have noted, it is tempting to see the struggle against anti-democracy sentiment based in bad economics in the conservative style, bad religion that lusts after worldly power, and racism, as simply a continuation of the US Civil War by other means. The cultural themes of the old slave-based south may indeed have risen again, giving sense to the renewed quest for a “national divorce” by the likes of Rep. Greene (Republican - Georgia). One wonders, will pro-democracy culture, the old northern yankee spirit, rise as well? And how does this all too American framing of our current brush with anti-democracy sentiment align with European style fascism, so popular in so much of the USA just now? Quite well indeed, but I suppose that must be an issue for another day, quite a long post already. 

What’s my point? Other than that history is interesting, may help one understand the present? Simply, we’re dealing with serious, significant intellectual themes and conflicts just now. Complacency, indifference to the underlying issues seems singularly unwise.