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Is Libertarianism Fundamentally about Competition? Or about Property?
David Brin
Contrary Brin
Posted: Jan 30, 2012
Some folks have heard me beat this drum. But it’s a fresh-enough thought - going to fundamentals that run deep beneath normal politics - so that I am moved to raise it yet again. In part because someone recently asked me, as author of The Transparent Society:“Can transparency and libertarianism complement each other?”
Now let’s have the simple answer first. Yes. A sane, better-focused libertarianism would be utterly compatible with transparency. In fact, it should be the very top priority.
Both Adam Smith and Friedrich Hayek proclaimed that markets are healthy in direct proportion to the number of skilled and knowing player-participants. Indeed, one chief indictment against every pre-modern economic system is that nearly all of them were based on “allocation” of resources by elites. Allocators are inherently knowledge limited and likely to be delusional, precisely because they are few.
Just to be doubly clear on that: almost all previous cultures used GAR - or Guided Allocation of Resources - as their guiding economic principle. Whether the allocation was done by kings, feudal lords, priests or communist nomenklatura, it was nearly always the same: decisions over how to invest society’s surplus, which endeavors to capitalize and which products to produce were made by a small clade of delusional elites, as wrong in their models as they were sure of them.
Starting with Adam Smith - and later fervently preached by others, including Hayek - the notion of FIBM, or Faith In Blind Markets, began to compete against GAR. The core notion? That the mass wisdom of millions of buyers, sellers, voters and investors will tend to emphasize or reinforce better ideas and cancel or punish bad ones. Delusions - the greatest human tendency - will be quickly discovered because no longer will some narrow group be able to nurse them without question. Hence, getting back to the original question: the more transparency - and the greater the number of participants - the more people can come up with relatively accurate models and act upon them… or acutely criticize flaws in the models of others.
But let’s extend that thought and ask an even more general question.
Isn’t libertarianism fundamentally an appreciation of competition?
Think about all the core enlightenment processes—entrepreneurial markets, science, democracy and justice. Each of these modern systems produce the modern miracle of positive-sum games… creating win-win scenarios for everybody. The famous rising tide that lifts all boats.
Now sure, there’s a lot more involved than just competition! There are many cooperative or consensus or even moral aspects… read Adam Smith’s The Theory of Moral Sentiments, to see that “competition” does not mean “cut-throat” or the brutal image of social darwinism. Many of today’s libertarians oversimplify, especially the followers of Ayn Rand.
Nevertheless, it is wholly right and proper for a libertarian to emphasize and focus on one main feature of these positive sum processes. The fact that they all arise by harnessing and encouraging fair rivalry among human beings. So let me reiterate.
Competition is the great creative force of the universe.
That’s proved. Competition produced all of nature’s evolutionary marvels… and us. By far the most successful human enterprise - science - is an inherently competitive process and scientists tend, by personality, to be extremely assertive in going after rivals. Moreover the arts, supposedly our “highest” endeavors, are inherently - often ferociously - competitive, even when they are lecturing us about cooperation! And yes, in professing this vast generalization you can see the libertarian in me - (despite my deep disdain for Ayn Rand.)
But the sane libertarian also knows that competition - in nature and primitive human societies - contains an inherent contradiction. A runaway process of self-destruction that historically always led (and I do mean always) to calamity…
...to the winner turning around and cheating! Victors in ancient combat were never content with incremental or partial success in war. Can you picture the victorious helping their adversaries to their feet and welcoming them to come back to another equal fight the following year? It was human nature, rather, to destroy opponents. The battlefield may have made you great, but you do not want to return there again and again for an endless series of even matches!
Think. In order to have maximum creative output, competition has to go on and on, maximizing innovative aspects and minimizing blood. The clearest example of transforming destruction into endlessly vigorous competition may be the ritualized combat systems called rule-based sports.
Nor is this just about war. Adam Smith saw what had happened in markets and societies for 4000 years. Winners in capitalism tend not to be satisfied with success in the latest market battle, with a cool product or in achieving recent financial or political success. Human nature propels us to use our recent victory to ensure that competitors will fail in future struggles. To bias the next competition. Or to stomp our defeated competitors flat! To absorb their companies. Squat on patents. Create monopolies or cartels to divvy-up markets. Eliminate transparency. Spy on competitors but keep them - and consumers in the dark. Capture regulators and make them work for us. Capture politicians and make the laws favor us.
Suppose that I become rich and powerful. What will I do, if I am one of the 99% who let human nature play out? Then I’ll use wealth and power to game the system so new competitors won’t challenge me! If you deny this, you’re just being silly. It was the way of oligarchy, in 99% of human cultures. The top priority of the owner-lords in all those nations was one distilled goal - to prevent bright sons of the the peasant class from competing fairly with the children of the rich. Admit it. Go ahead, choose a random decade across the last 60 millennia, in some random locale that had metals. Tell me this wasn’t the pattern.
It worked. It’s in our blood. We’re all descended from the harems of guys who pulled off that trick.
And here is where Adam Smith came in. He looked around, saw all the cheating by owner-oligarchs destroying the creative effectiveness of markets. And - in the seminal year 1776 - he called for something new. A way to get the best, most creative-competitive juices flowing, in the largest possible variety of human beings, while preventing the old failure mode. And it turned out there was a way.
As in rule-based sports, competition can only becoming self-sustaining… continuing to deliver its positive-sum outcomes… amid a network of transparent, fine-tuned, relentlessly scrutinized—and universally enforced—rules.
The vital importance - and difficult complexity - of “fairness”
Fair competition isn’t just a matter of morality. It is also the way to maximize competitive output, by ensuring that bright people and teams get second, third chances and so on. And creating ever-flowing opportunities for new competitors to keep arising from the population of savvy, educated and empowered folk. That kind of fairness requires rules and careful tending to ensure new competitors can and will always arise to challenge last year’s winners. And that earlier winners can’t cheat. Because… we’ve seen… they will.
Let’s be plain here. The founder of both liberalism and libertarianism - Adam Smith - weighed in about both of these reasons for fairness, To him, they were equally important. All right, liberals and libertarians each emphasize different ones. Liberals talk about the moral reasons for fairness and libertarians the practical, competition-nurturing ones. They tend to forget that - as followers of Smith - they actually want the same end result!
What they share is something deeper that both movements ought to recognize. They want every child to hit age 21 ready and eager to join the rivalry of work, skill and ideas.
Liberals should recall that fair competition is the driver, the engine of our cornucopia. The source of the wealth that made social progress possible. And libertarians need to pause, amid their dogmatic, “FDR-was-Satan” incantations, and recall that the word “fair” is the only thing that can make competition last.
Ironically, government can play a role there, if carefully watched. e.g. by ensuring that all poor kids get the care and education needed to become adult competitors! By ensuring that social status - whether poor or hyper-privileged - is never the prime determinant of success or failure. In other words, a sane libertarian who loves competition does not scream “Socialism!” at every state intervention. Instead, that grownup libertarian calmly judges every intervention by one standard.
“Will this help to increase the number of skilled, vigorous competitors?”
And by that standard, suddenly, liberals and libertarians have something to discuss. Without a scintilla of doubt, measures for civil rights, sanitation and public health, infrastructure, childhood health care and… yes… the vast increases in literacy wrought by public education… vastly increased the number of citizens capable of independent engagement in markets and innovative goods and services.
Sure, we are finding flaws in our schools! But that judgment (let’s remember) is from the higher plateau of expectations and desires that public education created! It is only because we achieved 99% literacy that - suddenly - 99% literacy is no longer anywhere near enough. Is it time to bring market tools and competition into education? Sure. Probably. And I am willing to discuss the assertion that teachers’ unions have “become a cartel.” Still, when criticism turns into willful dogmatism, a failure to acknowledge the accomplishments and effectiveness of mass society - brought into effect by government, exactly as demanded by Adam Smith(!) - well that’s churlish ingratitude and hardly a basis for saying “let’s move on to something better.”
And there are things government should not do! Some well-intentioned things that stymie competitive creativity, instead of enhancing it. “Equalizing all outcomes. is socialism and I am not on that boat! But maximizing the number of skilled and ready competitors is a different goal and I am here to hold that conversation. You may be surprised how many liberals and moderates will be willing to discuss it (and occasionally vote libertarian) if you make that the issue, instead of “FDR-was-Satan!”
A Movement based on LOVE of something, not HATE…
Sorry, but this needs to be hammered home, so let me repeat it. Screeching an incantation that government inherently suppresses competition is pure religious cant, disproved by countless counter-examples, from education and public health to the vast stimulative effect of public investments in science and technology and infrastructure. Again, look at 4000 years of history. Instead of simple-minded hatred of government, be more interested in pragmatic ways to enhance creative competition. Then the movement might have the subtlety of a surgeon or mechanic, instead of the sensibility of a berserk lumberjack. Make it about love of something, not bilious blame and hate.
So… is libertarianism consistent with transparency?
By that standard, transparency is clearly one of the most vital things that libertarians could defend. Hayek himself said that markets (and democracy and science and justice) only work when all participants know as much as possible. Absence of light is death to all four positive-sum games.
Alas, today’s libertarians are (I grieve to say it) in-effect quite mad. They worship unlimited private property, even though it was precisely the failure mode that crushed freedom in 99% of human cultures. And they rage against a system that in general resulted in vastly more wealth, freedom and more libertarians than any other.
This is a quasi-religious idolatry. It makes them complicit allies of the enemies of competition. It makes them murderers of the thing that they should love.
David Brin Ph.D. is a scientist and best-selling author whose future-oriented novels include Earth, The Postman, and Hugo Award winners Startide Rising and The Uplift War. David's next novel - Existence - (http://www.davidbrin.com/existence.html) will be published in June, 2012, by Tor Books."
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COMMENTS
So, if I’m hearing you right David you are talking about appropriate government rather than minimal government? I could make a convincing argument that providing a guaranteed minimum income to all citizens will result in better competition by your definition.
A GMI will mean that all children will have access to good food. That will mean that their brain development won’t be impaired by malnutrition and thus they will learn better at school and become better competitors in the market.
A GMI will also broaden the pool of competition by increasing the dollars available to be spent on local entrepreneurs which will also increase the quality of competition.
I could make similar arguments for free health care and free tuition at universities.
Does this mean that libertarians will line up to support socialist programs?
Another separate question. You define everything in terms of competition. After all competition is the driving force of everything. What is the place of symbiosis? As an earlier article suggested we are communities. Even our cells are communities with bits and pieces that were absorbed and made use of. A very good argument could be made for the idea that progress is the result of cooperation rather than competition.
“A very good argument could be made for the idea that progress is the result of cooperation rather than competition.”
Indeed, and an even better case can be made for the idea that it’s the result of both.
Well said Mr. Brin!
@ Alex, yes indeed cooperation is also important to greater success, transparency and accountability, especially where team work is concerned. There are ways to encourage healthy competition through meritocracy and social reward, by using successes as examples to inspire young minds to excel?
Your point about GMI or UBI is also important because it also enables an equal foundation for status, self respect and belief that hard work and effort can and does reward, instead of the young giving up all hope early due to status and social inhibitions, (external and internal)?
Rocket science: polarization of ideals and politics ensures that conflicts will always endure, the wisdom is indeed to find the “middle way”, and utilise the best of both viewpoints, (where practicable) - Now who suggested that rationale?
Overcoming labels for ourselves is a beginning for success? Denounce the worst of any policy and by extension its label?
@CygnusX1 I’m not sure that “finding the middle way” is going to work in every case. The merits of competition also apply to ideals and politics: first one needs a degree of polarisation and conflict, to set up the conditions for creative competition. Ove the competition is exhausted or stale, then is the time for each side to rediscover their “sanity” and find a middle way.
“Libertarianism” and “socialism” are arguably two such opposites, each insane when taken to an extreme, but each with a perfectly sensible idea at its core. I see it as a shortcoming of the political debate in the US that “socialism” is still seen as a dirty word, such that even a writer like David denounces equalising all outcomes as “socialism”, rather than (more correctly) as “extreme socialism”. In practice, of course, some policies in some states of the US are more “socialist” than in some countries of Europe, but the label itself seems to be toxic in the US.
Perhaps this illustrates a point about labels, namely that whether they become associated with extremes, and eventually denounced, or rather nuanced and mainstreamed, is to some extent a matter of historical chance. Fascism is clearly one of those that has been denounced, but was this an inevitable consequence of the core idea or was it rather a historical accident that it came to be associated with murder, destruction and (eventually ) defeat? Is communism, by contrast, undergoing a mainstreaming process, notably in China?
I guess my main gripe with libertarianism is its anachronistic nature. In its original (Smith/Hayek) form it seems to have been so well integrated into Western society that it hardly seems still to deserve a label, while in its more modern (Ayn Rand) form it seems to have the character of a fundamentalism. But as with the European liberals (who, on the continent at least, are the “libertarians” of Europe), they have a useful role to play in drawing attention to unnecessary or unhelpful government interference. Provided that they stay sane, as David suggests?
By the way, “fundamentalism” itself tends to be a dirty word, but we should also remember that fundamentalists generally arise because they feel the movement or religion to which they adhere has lost its way. And often they have a point.
Re “Suppose that I become rich and powerful. Then I’ll use wealth and power to game the system so new competitors won’t challenge me!”
David, this is precisely the reason why I have very strong reservations on U.S. style, “savage” libertarianism. It has a built-in winner-take-all runaway process that, an the end, leaves only a few monopolies standing and kills all the competition.
But this is also true of centrally planned economies: just replace “wealth” with “insider status” in the sentence above. As soon as you have buddies in the Party/Committee/Bureaucracy, favors to claim and (especially) dirty secrets to reveal, you use power, insider status and blackmail to game the system so new competitors won’t challenge you!”
“I’m not sure that “finding the middle way” is going to work in every case.”
That is why I said, (where practicable)?
“Perhaps this illustrates a point about labels, namely that whether they become associated with extremes, and eventually denounced, or rather nuanced and mainstreamed, is to some extent a matter of historical chance.”
Maybe, but my point was that by aligning to labels, we paint ourselves with immovable political colours and support policies that may not be beneficial, and disregard policies that would be, as it would “appear” to grate against our chosen political ideals, (reinforcing David’s opinion in his article).
An end to duopoly party politics through a policy of downsizing central nation state government bureaucracy and it’s polarising, and replacing this continued stagnation with more localised and democratic process and ability for folks to vote on policies by aggregate may help to overcome this eternal struggle and pursue more efficient progress?
For example, some of the ideas and solutions that UK PM David Cameron has had I agree with, although Tory party politics, (blue’s), is not really my flavour. I think there are many who are fed up with argument and counter positioning by party politics that is not constructive?
There was a time when we just placed our X in the coloured box of choice and treated our politicians with the trust and respect to sort out all of our woes and troubles for us, venerated like physicians, we rarely questioned their expertise - now we realise that this expertise may be lacking and bravado has replaced wisdom with knee jerk solutions, and lack of long term thinking, (more than 4 year office terms)?
“Fascism is clearly one of those that has been denounced, but was this an inevitable consequence of the core idea or was it rather a historical accident that it came to be associated with murder, destruction and (eventually ) defeat?”
No, there was no historical accident in it’s associations.
I think in the past politicians were under less pressure to behave as demagogues. They were under far less public scrutiny, and while that obviously led to abuses, those who were genuinely we’ll-intentioned and clever had more freedom to just get on with their job. I don’t think anyone really wants to go back there, even of it were possible, but the current situation presents challenges.
I’m not sure about localisation and people voting directly on policy. Most people have better things to do than develop the necessary expertise to make sensible decisions about specific policies. It’s one thing to take responsibility for our own health - and look to health care providers for access and guidance, not for authority - and another thing for us to take direct, collective responsibility for individual policies. A degree of crowd-sourcing of polocy makes sense (arguably it is what “focus groups” already do, testing the temperature of public opinion on various issues), but to actually devolve decision-making…I’m struggling to see how that works. The EU’s currency union is struggling precisely because important decision-making was left in national hands. One could say that we shouldn’t have a currency union, but what if we apply that logic down to the sub national level. Should we not have national currencies either?
Some decisions can and should be devolved, but for the rest we need to find ways to make decision-making at the nation state (or larger) level work better. And I think labels canals a positive role there, despite the shortcomings you describe. Ideological labels are like other words: they allow us to manipulate concepts, with our linguistic minds, that we otherwise would struggle to grasp clearly. And it’s OK for me if such labels have their champions, as long as there are also those of us who eschew them and explore the grey areas in between.
@Peter re “The EU’s currency union is struggling precisely because important decision-making was left in national hands.”
The EU currency union is struggling because important decision-making was centralized in incompetent hands.
@Giulio
See my reply on “We are all pirates”. It’s too easy to blame incompetent centralised bureaucrats. The monetary union was created in the first place by politicians, not bureaucrats, who saw it as a way to push European integration (for better or worse: hopefully history will prove for better, but that depends on us) at a time when the fiscal union that is required to make such things work was politically impossible. Was that stupid, a reckless gamble? Perhaps. Again, history will provide the answer, and history is still ours to shape.
One thing is clear: either Europe succeeds in weathering this crisis with stronger, more flexible institutions, more responsive to the real needs of its citizens, or it will become the playground (read: dumping ground) for larger, more integrated powers such as US and China, much as Europe used the rest of the world as its dumping ground from the Age of Exploration on. Is that what you want for Europe?
@Peter, I didn’t say “bureaucrats” (not this time). Politicians can be incompetent too.
@Giulio Indeed, but when one looks at the unseemly squabbling between said politicians, “centralised” is not the expression that immediately springs to mind!
“@Giulio Indeed, but when one looks at the unseemly squabbling between said politicians, “centralised” is not the expression that immediately springs to mind!”
Well you can’t have it both ways? You espouse the European “Union” yet contradict yourself with the above?
“The EU’s currency union is struggling precisely because important decision-making was left in national hands. One could say that we shouldn’t have a currency union, but what if we apply that logic down to the sub national level. Should we not have national currencies either?”
Why stop there, why not aspire to a Globally unified economy, fixed exchange rate mechanisms, unified currency, or equivalent points based system - trade between humans will still require local exchange of monies, or jewels, or metals, or goats, or whatever, in remote regions where a direct online link to a global economy is impossible or impracticable, (yet what about future mobile phone/device connections)?
Why not aspire to a globally integrated world economy that eliminates the squabbles and political machinations of nation state governments, that aims to overcome boom and bust with the use of networked supercomputers, elimination of human interference and greed, totally transparent, and that is totally impartial to political interference?
“I’m not sure about localisation and people voting directly on policy. Most people have better things to do than develop the necessary expertise to make sensible decisions about specific policies. It’s one thing to take responsibility for our own health - and look to health care providers for access and guidance, not for authority - and another thing for us to take direct, collective responsibility for individual policies.”
I disagree, and think that more peoples would want more control over their lives and to be empowered through increased democratic process. Even Cameron wants to aspire to his social philosophy of shared responsibility and to empower peoples and the “BIG Society”, delegating central government powers for administration and budget to local authorities, communities and groups, and by reduction to individuals - However, he hasn’t so much pushed this of late as he is presently too busy imposing austerity measures directly from central government?
Most peoples would not be indisposed or too busy to vote on policies that affect them and their communities directly, and online technology has the speed and process to be used for just such process? People need not “develop the necessary expertise to make sensible decisions”, if due democratic process and voting/options are simplified for all peoples to understand, (as they should be). Referendum, and especially online community participation and voting can cater for much of the administration, budget, revenue and taxation priorities within communities, including roads, healthcare, social welfare, fines and levies, tax breaks for small business, and other social and community needs etc.
The danger as Giulio has pointed out before, is in BIG government, (including the EU), attempting to micro-manage social policy through increased laws, legislation, complexity and bureaucracy. It is not logical that some envisioned Global or unified authority, (as above) could possibly micro-manage such things efficiently, and should thus delegate, but not necessarily into the hands and the political machinations of nation state governments, comprised of politicians that are out to serve their own agendas whilst in office and power?
Let’s drive towards universal values, ethics, economic stability and union. Let’s increase democratic process and participation and transform the geometry of hierarchy of the pyramid to that of a trapezium, (now someone wrote an article about this here some place?)
@cygnusX1
If all this can be made to work then there’s a lot I find attractive about it. And yes, eventually, why not global economic stability and union, and based on something more equitable than one (dangerously indebted) country’s currency.
I espouse the European Union in the sense that, as I’ve said to Giulio on the “pirates” thread, if we don’t hang together we’ll hang separately. No single European country is big enough to compete with the likes of US and China. So when I complain of squabbling politicians I am complaining about decentralisation, or lack of centralisation, with too much power still being vested in the larger national capitals, and a similarly fragmented media that keeps democratic decision-making fragmented, leaving the door open for more shadowy, better integrated power structures to rule unopposed.
Re localisation and people voting directly on policy, I think there is some middle ground between our views that is worth exploring (a “middle way” indeed!). I certainly believe that decision-making by politicians and bureaucrats can become awfully sclerotic, with the views of citizens being dismissed as “stupid” or “ignorant” when decision-making structures that _forced_ such views to be taken more seriously would inject some much needed fresh air into the process. But it could also lead to squabbling, and very bad, ignorance-based decisions.
The challenge can perhaps be illustrated by imagining that I decide to employ an accountant to take care of my financial affairs. I do so in part because I neither have nor wish to develop the expertise to do so myself, preferring to focus on what I actually like and am good at. Ideally, this must surely also be what we want from our politicians. We don’t want to be having to continually second-guess them; if we do, better to fire them and get new ones. Just how much we wish, or should wish, to be directly involved can be discussed, but a degree of centralised (but democratically accountable) decision-making seems to be essential.
“A very good argument could be made for the idea that progress is the result of cooperation rather than competition.”
The majority of Americans would disagree; at this time only perhaps in the Vatican City (a separate nation) would the above be valid, and the Vatican City is cliquish, as every country is. All of you do what you please, I am going to fight the GOP and its ilk to the end of time if necessary.
Women and children can vacillate; men cannot.
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