Backwards Bad Economics In The Conservative Style

I was just thinking to myself how anti-democracy bad economics in the conservative style looks at real neoclassical welfare economics and manages to get the conclusions not just wrong but completely backwards. It’s a rather remarkable rhetorical accomplishment. Let’s discuss.

Neoclassical welfare economics demonstrates one cannot identify optimal economic arrangement or outcomes, nor discuss the efficiency of means to attain optimal outcomes, without taking up normative issues including importantly interpersonal ethics. One can say under false factual premises like perfect information and perfect rationality some near-enough approximation to a theoretical “perfectly competitive” market has some desirable features, but one cannot compare it to any other arrangement giving different distributional results. Nor is that only true of other “perfectly competitive” market outcomes; it’s also true of non-“perfectly competitive” market outcomes. Any change in distributional effects, who gets what, renders it impossible to compare to other results in neoclassical welfare economics. Similarly, one can’t discuss “efficiency” without specifying an objective, which requires exogenous normative inputs, as so-called “economic” or “Pareto” efficiency, which addresses doing the best one can under certain false factual premises without taking up interpersonal ethics. (The technical definition involves getting people as far up their preference rankings as possible without others moving down their preference rankings, so a status-quo preserving assessment based only on individuals’ own preference ranks and not interpersonal ethics, but it’s not important here.)

Bad economics in the conservative style takes that result and flips it on its head, arguing to achieve optimal economic results, one must eschew the interpersonal ethics that complicate the assessment of (ostensibly near-enough approximations to theoretical) perfectly competitive markets. One rhetorical approach in bad economics is to play games with normative and positive and cite theoretical ciphers in economic models having no preferences across interpersonal ethics to say no one, in fact, has interpersonal ethics. (See the so-called “methodological individualism” critique.) Another rhetorical technique used in bad economics is fake indifference, which surreptitiously introduces the exogenous normative input maintaining status quo arrangements is desirable or preferable, whatever they are, to argue neutrality is maintained by supporting status quo market outcomes. This then leads to the argument that because interpersonal ethics are exogenous to neoclassical welfare economics, economists qua economists should be neutral and advocate for any market deemed close enough approximations to the perfectly competitive model, always in reality a particular instance. The argument is false. Economists qua economists should transmit the results of neoclassical welfare economics and be indifferent to maintaining any given instance of a near-enough approximation of a perfectly competitive market or moving to any other outcome with different distributional results. Real neoclassical welfare economics does not say one should strive toward, maintain, not interfere with, not distort, any given instance of a market result, nor does it say anything about the extent of the market. All that sort of talk in indicative of bad economics in the conservative style. Real neoclassical welfare economics does not say greed is good, egoism leads to optimal results, no one should have interpersonal ethics, no one does have interpersonal ethics, interpersonal ethics are empty virtue signaling, etc. All that sort of talk is bad economics in the conservative style.

Bad economics in the conservative style supports anti-democracy fascism because rather then seeing voters providing normative inputs via democratic government as a necessary input to achieving optimal economic arrangements, it sees preventing voter input, blocking democracy, as essential. When you think about the normative theory or ethical argument of neoclassical welfare economics, think about the real theory, not the false backward one from anti-democracy bad economics in the conservative style. Think about the one that pairs with democracy, not the one that pairs with fascism.

Entitlements

I read a conservative lady proposing people with a sense of entitlement are destroying the USA and I found it ironic because, yes, entitled conservatives opposed to democracy because voters might disagree their sense of entitlement is a big issue indeed. Let’s discuss.

When talking about “entitlements,” the first step is obviously to distinguish ethical / moral / normative entitlements, which one may propose or endorse but exist really only in one’s own head, from legal entitlements, which objectively exist in law. Of course, laws must be interpreted, and our judicial system has an entire mechanism to do that. I mean merely any requisite judicial interpretation of a law is not meant to be an entirely open-ended affair, a random matter of any given individual’s moral or ethical views on the matter. 

Ethical and legal entitlements are related but indirectly. In a democracy, the views of the majority of voters are meant to be reflected in law, mostly those of past voters of course, but current voters may elect people to change existing laws they view as particularly immoral or unethical. Obviously, existing laws may not correspond entirely to the moral or ethical views of any particular voter, which is why one must make a separate ethical decision concerning one’s commitment to democracy, society, the rule of law, including any limitations or boundaries on that commitment. One wouldn’t care to set one’s commitment so strong one will accept laws one finds morally outrageous nor so weak one goes outlaw or revolutionary at the drop of a hat. The default in a democracy must be to put up with laws one disagrees with an eye to changing them in the future.

Ethical entitlements are just propositions about what one supposes one and others ought to be able to do or have. Everyone may be presumed to be operating with some such sense of ethical entitlement based in their ideas of interpersonal ethics, equity, fairness, justice. In that context, one must watch for a very typical maneuver in conservative rhetoric in which a proposition to uphold current or status quo entitlements is cast as “neutral” or showing indifference rather than being simply another take on entitlements. That’s the sense conservative rhetoricians use when they claim those who try to change status quo entitlements are uniquely expressing a sense of entitlement, while those who support status quo entitlements are devoid of any sense of entitlement.

As far as legal entitlements, the distinction being made is between something one is entitled to have or do under the law versus something that is under the discretion of some official to grant or not grant. It’s not about one’s views on moral or ethical entitlements. For example, Social Security in the USA is a legal entitlement. One needn’t go hat in hand and plead one’s case before some official to receive a check. One pays into the system according to law, and one is entitled a certain amount from the system according to law. Those who complain about legal entitlements are typically indirectly saying they disagree the ethics of the law, but they may couch their rhetoric in the fact they’re talking about legal entitlements they cannot unilaterally and arbitrarily end as they might were they discretionary.

Returning to our original argument, ethical and legal entitlements are relevant to any system of ethics, law, government as democracy. However, anti-democracy conservatives may oppose voters talking about ethical entitlements or being able to revise legal entitlements and may say so in odd ways. Conservative rhetoricians have long had great fun playing word games with “entitlements.” Don’t play their games. Everyone should have views on interpersonal ethics and thus a sense of ethical entitlement, and in a democracy should express those views by supporting particular legal entitlements. Popular discussions of “entitlements” are designed to direct people away from serious, sincere discussion of the real issues, here whether any given entitlement is ethically justified or legally valid, into word-play relating to the term itself. Watch for it.