PITCHES: Ideas, Policies, Politics

We need to talk about …. ETHICS in PUBLIC LIFE?

by Professor Bob Hudson

Ever since the 2016 EU referendum it has felt to many that we are at a moral crossroad in UK public life. The event was conducted on the basis of deception – lies about the NHS; lies about Turkey’s membership of the EU; lies about immigration from Iraq and Syria, gross breaches of electoral law and much more. Moreover, it didn’t seem to matter. All the old conventions and understandings around honesty and honour no longer held and all that mattered was winning. We were in a terrifying ‘post-truth’ era. Continue reading “We need to talk about …. ETHICS in PUBLIC LIFE?”

SOCIAL VALUE: combining Public, Private, and Civic contributions?

 

by Colin Talbot

There has been an almost hegemonic view for several decades that value – wealth – is created solely by the private sector. The “wealth creators” are, allegedly, the entrepreneurs and innovators of the private corporate sector. The role of the state was, at most, to (re)distribute the wealth created.

This is, of course, nonsense. A convenient myth often used as justification for what is in reality more wealth extraction than wealth creation. In this article a very different perspective on what really constitutes Social Value is explored.

PRIVATE & PUBLIC VALUE CREATION

The main assault on this simplistic, and wrong, account of value production has come from economists re-evaluating the whole idea of ‘value’ and how we, as a society, account for and manage it. People like Dianne Coyle and Mariana Mazzucato have been fundamentally challenging how we measure economic and social progress, which devalues some contributions (Coyle), and that public activity creates value and does not just consume or redistribute it (Mazzucato).

The public sector does create, not just consume, value. Providing  education or health care is not just a consumption activity, it produces a healthy and well-educated workforce which is an essential component of production. Further the public sector creates value through activities like research and development, something Mazzucato has emphasised in her previous book on The Entrepreneurial State. Publicly provided infrastructure like roads and railways is as much part of the ‘production’ process for a company like Amazon as are its own warehouses and software. Continue reading “SOCIAL VALUE: combining Public, Private, and Civic contributions?”

Liberal solidarity and the seven dimensions of liberalism

Beyond its shared stress on liberty and rights, liberalism comes in many different forms. One of these varieties is liberal solidarity.

Geoffrey M. Hodgson

(Originally published on Geoffrey’s blog here)

All versions of liberalism stress individual liberty and universal rights, including the rights to private property and to freedom of expression. These universal rights and liberties require equality under the law, under a competent legal system that protects those rights and pursues justice.

Original conservativism differs from liberalism because it stresses established or religious authority and tradition over rights. Socialism generally differs from liberalism because it downgrades the right to private property. But there is no historical case where personal and civil liberties have existed without extensive rights of private property.

Statist socialism further differs from liberalism also because it concentrates politico-economic power in the hands of the state, thus undermining countervailing power, which is necessary to sustain democracy and individual rights. Marxism differs from liberalism to an even greater degree, because it regards all liberal rights as bourgeois: it rejects the idea of universal individual rights in favour of the class rule of the proletariat.

Liberalism was broadly defined in its struggles against despotism. But once autocracy is removed, and freedom and legal equality are established, then liberalism as a whole lacks a further common purpose, other than the preservation or consolidation of those liberal gains. At this point, the wide liberal coalition divides into multiple zones, exploring different districts of their spacious common territory, and falling on different sides of key dilemmas.

Hence the Enlightenment triumph of liberalism gave way to rival liberalisms, each stressing different priorities or visions of the future. These differences range across multiple dimensions in conceptual hyperspace.

While exploring seven dimensions of this hyperspace, I accent a particular variety of liberalism that I call liberal solidarity. 

The seven dimensions

Consider the following seven vital dilemmas:

1. Broad versus narrow conceptions of liberty.

The narrow definition of liberty, promoted by Freidrich Hayek and Milton Friedman among others, is the absence of coercion. Other liberals – including John Stuart Mill, Michael Polanyi, Isaiah Berlin and Amartya Sen – argued that this is insufficient. They asked us to consider the conditions enabling the individual to appraise his or circumstances and then to act freely, typically in cooperation with others. These conditions constitute positive or public liberty, in contrast to the negative or private liberty provided by the absence of coercion. As well as the capacities for choice and action, some writers argue that liberty is also about the opportunities for self-development and for human flourishing.

2. Degrees of commitment to representative political democracy.

Most liberals support representative political democracy, as long as it does not overturn basic human rights, including the rights of minorities. But some liberals, such as Ludwig Mises and Hayek, have regarded democracy as dispensable under specific conditions, believing that the preservation of private property and markets are more important. The counter argument is that democracy is strongly correlated with economic development, the protection of human rights, and the absence of war and famine. Hence democracy is vital for a healthy, tolerant and open society.

3. Degrees of emphasis on economic equality.

Thomas Paine was a liberal who stressed the interdependence of individuals in a free society. Hence, given our debt to others, we are obliged to pay taxes for the common good. Also John Stuart Mill argued there should be some redistribution of inherited wealth. Against libertarian individualists, many liberals defend responsible trade unions as a way of empowering working people and reducing inequality. These are cases of liberal solidarity rather than atomistic individualism.

4. Possible limits to choice and markets.

While liberals generally stress the importance of individual choice, in both trade and politics, some also stress the practical and moral boundaries to contracts and to markets. Today we condemn the holding and trading of slaves. For democracy to be uncorrupt, there should not be markets for the votes of ordinary people or politicians. Other market arrangements are challengeable, on moral or practical grounds, suggesting that contracts and markets are not the solution to every problem.

5. Grounds for state intervention and a welfare state.

Some liberals, including John A. Hobson and John Dewey, saw the provision of adequate healthcare and education as vital for individual self-determination and flourishing. Individuals should also be as free as possible from the anonymous coercions of ignorance, destitution and illness. Hence the liberals David Lloyd George and William Beveridge built the foundations of the welfare state in the UK. John Maynard Keynes pointed to the need for the state to intervene to prevent financial crashes and minimize unemployment. Many modern liberals also accept the legitimacy of judicious state action to mitigate climate change.

By the above five criteria, liberal solidarity recognizes liberty as more than the absence of coercion, defends political democracy, attempts to reduce extremes of economic inequality, and conceives of a larger role for the state than small-state versions of liberalism. It promotes a mixed economy including some public ownership and a variety of forms of private enterprise. The mixture would include worker cooperatives (which are the most viable positive legacy of small socialism).

Liberal solidarity counters the original liberal emphasis on minimal government. Some state intervention is necessitated by the limitations of markets and by growing complexity. Nevertheless, all liberals acknowledge the dangers of excessive bureaucracy and concentrations of state power, and they call for mechanisms of scrutiny and accountability, as well as for countervailing powers.

6. Self-interest versus cooperation and morality.

Several liberals have argued that social order emerges out of the interactions of self-interested, pleasure-maximizing individuals. But this is not a universal view among liberals. While recognizing the selfish aspects of human nature and the incentives they offer for trade and innovation, many liberals stress the importance of morality, justice or duty. They argue that adequate social cohesion cannot be achieved on the basis of selfishness alone. Adam Smith expressed this view: he was not an unalloyed advocate of individual selfishness. Charles Darwin – who politically was a liberal – explained how, alongside a measure of self-interest, morality and cooperation were products of human evolution, and thus part of our nature. Hobson took up this Darwinian view, also underlining the importance of moral motivation. Relatedly, Keynes saw the Benthamite utilitarian calculus of pleasure-seeking, as “the worm which has been gnawing the insides of modern civilisation and is responsible for the present moral decay.” The motivational bases of liberal solidarity are morality, sympathy and justice, and not simply personal satisfaction or self-interest.

7. Nationalism versus internationalism and openness.

Like socialism and conservativism, liberalism has been divided on questions of foreign policy. Socialists, conservatives and liberals have argued for and against specific wars, for or against imperialism or colonialism, for or against the idea of exporting favoured institutions by invading other countries with armed force. They have also been internally divided on immigration policy, advocating different degrees of restriction or free movement.

Addressing dimension six, liberal solidarity emphasises our potential for cooperation and moral judgment, rather than focusing on self-interest alone. In regard to dimension seven, liberal solidarity opposes imperialism and colonialism. It stresses the importance of social inclusion and the benefits of free movement.

Liberals, Conservatives and Republicans

From the beginning of the twentieth century, in the UK and the US, liberalism became more interventionist. Versions of liberalism prominent in the UK and US are closer to liberal solidarity than some variants in Continental Europe.

When unfettered-market, minimal-state versions of liberalism re-emerged in the UK and US, and became more prominent in the 1970s, they had to find different homes. They took over the Conservative Party in the UK and the Republican Party in the US. Hence Margaret Thatcher was elected as a Conservative Prime Minister in 1979 and Ronald Reagan as a Republican President in 1980. In some their ideas they sounded like nineteenth-century liberals: Whigs became Tories.

But their adoption of unfettered-market ideology was partial, and often compromised when traditional conservative values were threatened. Supported by Thatcher, Reagan ramped up military spending. Their nationalism was heightened when it came to foreign policy and international trade. They retained restrictions on recreational drugs or prostitution. They stressed ‘family values’ as much as rampant individualism.

Like others, these two parties are coalitions, involving unfettered-marketeers, nationalists and traditional conservatives. The election of Donald Trump as US President in 2016 shows the strength of the conservative and nationalist strain among Republicans. Trump is no liberal: he advocates torture, attacks minorities, threatens the press, imposes tariffs and pursues a version of economic nationalism.

Thatcher and Reagan overlooked the absence of democracy in Augusto Pinochet’s Chile and in Apartheid South Africa, and supported stronger military and executive powers. As Andrew Gamble put it, Thatcher and Reagan promoted a ‘free economy and a strong state’.

Thatcher and Reagan were inspired by leading intellectuals such as Hayek and Friedman, who had been working for decades to restore the influence of unfettered-market liberalism. But neither Hayek nor Friedman fits exactly into the Thatcher-Reagan mould. Friedman, for example, advocated the decriminalization of drugs and opposed compulsory military service. He also opposed the Gulf War of 1990-1991 and the Iraq Invasion of 2003.

Hayek voiced partial support for a welfare state. Although he did not support redistributive taxation to reduce inequality, he advocated legislation to limit working hours, state assistance for social and health insurance, state-financed education and research, a guaranteed basic income, and other welfare measures. At least once, Hayek also accepted Keynesian-style, counter-cyclic government strategy to deal with fluctuations in economic activity. Consequently there was some significant difference between Hayek and other libertarians.

Challenges for liberal solidarity

Having set out the large, seven-dimensional hyperspace and explored a few of the important positions within it, it is clear that the depiction of liberalism as broad church is an understatement. The potential variation within liberalism is huge. That is both an asset and a problem. Each variety of liberalism faces the difficulty of distinguishing itself from others. We need to subdivide liberalism’s massive territory if we are to navigate and explore different positions. Each important position within the large space needs to be differentiated from others.

A later blog will further explore the seven-dimensional hyperspace of liberalism and develop the case in favour of liberal solidarity. I shall also show a dramatic contrast with what is often described as neoliberalism.

1 August 2018

Bibliography

Gamble, Andrew (1988) The Free Economy and the Strong State: The Politics of Thatcherism (London and New York: Palgrave Macmillan).

Hodgson, Geoffrey M. (2013) From Pleasure Machines to Moral Communities: An Evolutionary Economics without Homo Economicus (Chicago: University of Chicago Press).

Hodgson, Geoffrey M. (2015) Conceptualizing Capitalism: Institutions, Evolution, Future (Chicago: University of Chicago Press).

Hodgson, Geoffrey M. (2018) Wrong Turnings: How the Left Got Lost(Chicago: University of Chicago Press).

August 1st, 2018 by geoffhodgson1946